Exhibit 10.1

PURCHASE AND SALE AGREEMENT

BY AND BETWEEN

DYNEGY HOLDINGS INC.

AS SELLER

AND

ENERGYCO, LLC

AS BUYER

DATED AS OF MAY 28, 2007

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Table of Contents

 

          Page

ARTICLE 1

   DEFINITIONS    1

Section 1.1

   Definitions    1

Section 1.2

   Accounting Terms    9

ARTICLE 2

   PURCHASE AND SALE; CLOSING    9

Section 2.1

   Purchase and Sale of Membership Interests; Assumption of Assigned Contracts
   9

Section 2.2

   Purchase Price    10

Section 2.3

   Allocation of Purchase Price    11

Section 2.4

   Time and Place of Closing    12

Section 2.5

   Closing    12

ARTICLE 3

   REPRESENTATIONS AND WARRANTIES OF SELLER    14

Section 3.1

   Organization; Qualification    14

Section 3.2

   Authority Relative to This Agreement    14

Section 3.3

   No Violation; Consents and Approvals    14

Section 3.4

   Capitalization and Ownership    15

Section 3.5

   Certain Contracts and Arrangements    15

Section 3.6

   Title to Properties and Related Matters    16

Section 3.7

   Legal Proceedings    16

Section 3.8

   Permits; Compliance with Law    16

Section 3.9

   Environmental Matters    17

Section 3.10

   Taxes    18

Section 3.11

   Brokers    18

Section 3.12

   Insurance    18

Section 3.13

   Employees    18

Section 3.14

   Absence of Certain Changes    19

Section 3.15

   Liabilities    19

Section 3.16

   Balance Sheets    19

ARTICLE 4

   REPRESENTATIONS AND WARRANTIES OF BUYER    20

Section 4.1

   Organization    20

Section 4.2

   Authority Relative to This Agreement    20

Section 4.3

   Consents and Approvals; No Violation    20

Section 4.4

   Availability of Funds    21

Section 4.5

   Brokers    21

Section 4.6

   Qualified Buyer    21

Section 4.7

   Legal Proceedings    21

Section 4.8

   Acquisition as Investment    21

Section 4.9

   Opportunity for Independent Investigation    21

ARTICLE 5

   COVENANTS OF THE PARTIES    22

Section 5.1

   Conduct of Business    22

Section 5.2

   Access to Information    24

Section 5.3

   Consents and Approvals    25

Section 5.4

   Further Assurances    26

Section 5.5

   Public Statements    27

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Table of Contents

(cont.)

 

          Page

Section 5.6

   Tax Matters    27

Section 5.7

   Confidentiality    29

Section 5.8

   Compliance with Governmental Agreements    30

Section 5.9

   Counterparty Consents; Replacement Support Obligation    30

Section 5.10

   Employee Matters    30

Section 5.11

   Insurance    32

Section 5.12

   Casualty    33

Section 5.13

   Condemnation    34

Section 5.14

   Termination of Affiliate Contracts    34

Section 5.15

   Supplement to Schedules    34

Section 5.16

   Pre- and Post-Closing Cooperation    35

Section 5.17

   Buyer Letter of Credit    35

ARTICLE 6

   CONDITIONS    35

Section 6.1

   Conditions Precedent of Each Party    35

Section 6.2

   Conditions Precedent of Buyer    36

Section 6.3

   Conditions Precedent of Seller    36

Section 6.4

   Break-up Fee    37

ARTICLE 7

   INDEMNIFICATION    37

Section 7.1

   Indemnity Obligations    37

Section 7.2

   Cap Amount; Minimum Claim    39

Section 7.3

   Third Party Claims Procedures    40

ARTICLE 8

   TERMINATION    41

Section 8.1

   Termination    41

ARTICLE 9

   MISCELLANEOUS PROVISIONS    41

Section 9.1

   Expenses    41

Section 9.2

   Amendment and Modification; Extension; Waiver    42

Section 9.3

   Survival    42

Section 9.4

   Notices    42

Section 9.5

   Assignment; No Third Party Beneficiaries    43

Section 9.6

   Governing Law    43

Section 9.7

   Counterparts    43

Section 9.8

   Interpretation    44

Section 9.9

   Jurisdiction and Enforcement; Waiver of Jury Trial    44

Section 9.10

   Entire Agreement    45

Section 9.11

   Severability    45

 

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Schedules and Exhibits

 

Item

  

Description

Schedule 2.1(b)

   Assigned Contracts

Schedule 2.1(c)(iii)

   Retained Software License Agreements

Schedule 2.5(a)(iii)

   Replacement Credit Support Requirements

Schedule 3.3(a)

   No Violation

Schedule 3.3(b)

   Seller Required Regulatory Approvals

Schedule 3.4

   Capitalization

Schedule 3.5(a)

   Certain Contracts/Arrangements

Schedule 3.5(b)

   Certain Contracts/Notice of an Event of Default

Schedule 3.5(c)

   Certain Contracts/Affiliate Contracts

Schedule 3.6(a)

   Real Property Interests

Schedule 3.6(c)

   Tangible Business Assets Not Owned by the Company

Schedule 3.7

   Legal Proceedings

Schedule 3.8

   Permits; Compliance with Law

Schedule 3.9

   Environmental Matters

Schedule 3.10

   Tax Matters

Schedule 3.13(a)

   Benefit Plans

Schedule 3.13(b)

   Employees

Schedule 3.14

   Absence of Changes

Schedule 3.15

   Liabilities

Schedule 4.3(b)

   Buyer Required Regulatory Approvals

Exhibit A

   Buyer Parent Guaranty

Exhibit B

   Form of Technology Transfer Agreement

Exhibit C

   Form of Transition Services Agreement

 

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PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (including the exhibits and schedules hereto,
this “Agreement”), is dated May 28, 2007, (the “Effective Date”) by and between
DYNEGY HOLDINGS INC., a Delaware corporation (“Seller”), on the one hand, and
ENERGYCO, LLC, a Delaware limited liability company (“Buyer”), on the other
hand. Buyer and Seller are referred to herein individually as a “Party” and
collectively as the “Parties.”

WHEREAS, Seller owns, indirectly, all of the issued and outstanding shares of
capital stock of CoGen Lyondell Inc., a Texas corporation (the “Company”);

WHEREAS, in connection with the transaction contemplated herein, Seller will
convert the Company from a Texas corporation to a limited liability company and
change its name from CoGen Lyondell Inc. to CoGen Lyondell LLC;

WHEREAS, after the conversion, Seller will own, indirectly, all of the issued
and outstanding membership interests of CoGen Lyondell LLC;

WHEREAS, the Company operates a power generation facility located in
Channelview, Texas (the “Generating Facility”);

WHEREAS, Buyer desires to purchase from Seller all of the issued and outstanding
membership interests of the Company (the “Membership Interests”) and assume
certain contracts, rights and obligations relating to the Generating Facility,
and Seller desires to sell to Buyer the Membership Interests and assign said
contracts, rights and obligations to Buyer pursuant to the terms and conditions
hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements hereinafter set forth, and intending to be legally
bound hereby, the Parties agree as follows:

Article 1

Definitions

Section 1.1 Definitions. Capitalized terms used but not otherwise defined in
this Agreement shall have the respective meanings given to such terms set forth
below:

“1933 Act” shall have the meaning set forth in Section 4.8.

“Accepted Electric Practice” means any of the applicable practices, methods and
acts:

(i) required by ERCOT, or the successor of ERCOT, whether or not the Party whose
conduct is at issue is a member thereof;

(ii) required by applicable law or regulation;

(iii) required by the policies and standards of the Company or the Seller’s
Affiliates, as applicable, relating to emergency operations; or

 

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(iv) otherwise engaged in or approved by a significant portion of the electric
utility industry during the relevant time period;

which, in the exercise of reasonable judgment in light of the facts known at the
time the decision was made, could have been expected to accomplish the desired
result at a reasonable cost consistent with applicable law, regulation, good
business practices, reliability, safety, and expedition. As used herein,
“Accepted Electric Practice” is not intended to be limited to the optimum
practice, method, or act to the exclusion of all others, but rather to be
acceptable practices, methods, or acts generally accepted in the region.

“Actual Working Capital” means the sum of cash and cash equivalents, accounts
receivable, inventory, prepaids and other current assets, less non-transferable
items (including prepaid insurance and payroll accrual), accounts payable,
accrued use and ad valorem taxes, accrued liabilities and other current
liabilities, each as of the Closing Date; provided, however, that any
receivables owed by, or payables owed to, Affiliates of the Company shall be
paid as of the Closing Date.

“Affiliate” means with respect to any specified Person, a Person that directly,
or indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with, the Person specified. For purposes of this
definition, “control” (including the correlative terms “controlling,”
“controlled by” and “under common control with”) means the possession, direct or
indirect, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting equity interest,
by Contract or otherwise.

“Aggregate Deductible” shall have the meaning set forth in Section 7.2(a).

“Agreement” shall have the meaning set forth in the preamble.

“Assigned Contracts” shall have the meaning set forth in Section 2.1(b).

“Assignee” shall have the meaning set forth in Section 2.5(a)(ii).

“Assignment and Assumption Agreement” shall have the meaning set forth in
Section 2.5(a)(ii).

“Assignor” shall have the meaning set forth in Section 2.5(a)(ii).

“Balance Sheets” shall have the meaning set forth in Section 3.16.

“Benefit Plan” means each (i) employee benefit plan (as defined in Section 3(3)
of the ERISA) and (ii) incentive compensation, retention, employment, severance,
change in control, consulting or other compensation or benefit agreement, plan,
program or arrangement, in each case (a) that is sponsored or contributed to by
the Company or to which the Company is a party, (b) with respect to which the
Company has or may reasonably be expected to have any liability (either directly
or because the Company is or was treated as a single employer under
Section 414(b), (c), (m) or (o) of the Code) or (c) that is maintained by Seller
or any of its Affiliates for the benefit of any Employees.

 

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“Business” means the business of operating the Generating Facility and
generating and delivering electric energy and capacity from the Generating
Facility to its interconnection point(s) with the transmission system to which
it is interconnected. The “Business” also includes the cogeneration of steam and
optimization of steam assets in accordance with that certain Steam and Electric
Power Sales Agreement, effective as of January 2007, between the Company and
Lyondell Chemical Company. The Business does not include the marketing and sale
of electric energy and capacity or the procurement of fuel for the Generating
Facility.

“Business Day” means any day that Seller’s downtown Houston, Texas office is
open for business.

“Buyer” shall have the meaning set forth in the preamble.

“Buyer Indemnitees” shall have the meaning set forth in Section 7.1(a).

“Buyer Letter of Credit” means an irrevocable, nontransferable standby letter of
credit issued by a U.S. commercial bank or a U.S. branch of a foreign bank with
such bank having a credit rating of at least “A-” from Standard & Poor’s Rating
Group (a division of McGraw-Hill, Inc.) and “A3” from Moody’s Investor Services,
Inc. (it being agreed by Seller that Wells Fargo is an acceptable issuer) in
form and substance acceptable to Seller in its reasonable discretion, in an
amount equal to five percent (5%) of the Purchase Price, having an expiry date
no earlier than December 31, 2007, and providing that Seller may draw upon the
entire amount thereof in the event of a material breach by Buyer of its
obligations under this Agreement, which letter of credit, upon delivery to
Seller as contemplated by Section 8.1(f) hereof, shall secure all of Buyer’s
obligations to Seller under this Agreement.

“Buyer Material Adverse Effect” means any change or event that would have a
material adverse effect on the ability of Buyer to consummate the transactions
contemplated by, and discharge its obligations under, the Agreement.

“Buyer Parent Guaranty” means the Guaranty Agreement executed and delivered to
Seller by PNM Resources, Inc. on the Effective Date in the form attached hereto
as Exhibit A.

“Buyer Required Regulatory Approvals” shall have the meaning set forth in
Section 4.3(b).

“Closing” shall have the meaning set forth in Section 2.4.

“Closing Date” shall have the meaning set forth in Section 2.4.

“COBRA” shall have the meaning set forth in Section 5.10(i).

“Code” means the Internal Revenue Code of 1986, as amended.

“Company” shall have the meaning set forth in the recitals.

“Company Assets” means all of the assets of the Company.

 

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“Condemnation Value” shall have the meaning set forth in Section 5.13.

“Confidential Information” shall have the meaning set forth in Section 5.7.

“Contracts” means any contract, agreement, arrangement, commitment, letter of
intent, memorandum of understanding, promise, obligation, right, instrument,
document, or other similar understanding, whether written or oral.

“Conversion” shall have the meaning set forth in Section 5.6(d).

“Effective Date” shall have the meaning set forth in the preamble.

“Employee Transition Date” shall have the meaning set forth in Section 5.10(a).

“Employees” means those employees of Seller or its Affiliates who work at the
Generating Facility and whose principal activities relate to the Business.

“Encumbrances” means any mortgages, pledges, liens, security interests,
conditional and installment sale agreements, activity and use limitations,
exceptions, conservation easements, rights-of-way, easements, licenses, deed
covenants, deed restrictions, encumbrances and charges of any kind.

“Enforceable” means capable of being enforced against the applicable Person in
accordance with specified and certain terms as a legal, valid, and binding
obligation of such Person, except as such enforceability may be subject to the
effects of bankruptcy, insolvency, reorganization, moratorium, or other laws
relating to or affecting the rights of creditors, and general principles of
equity.

“Environmental Condition” means the presence, release or disposal of any
Hazardous Substance at, in, on or from the Generating Facility or any of the
Company Assets in violation of any Environmental Law or any violation of any
Environmental Law with respect to the Company or the Generating Facility.

“Environmental Laws” means all federal, state, local and foreign laws (including
common law), treaties, regulations, rules, ordinances, codes, decrees,
judgments, directives or orders (including consent orders) and Environmental
Permits, in each case, relating to pollution or protection of the environment or
natural resources, including laws relating to Releases or threatened Releases,
or otherwise relating to the generation, manufacture, processing, distribution,
use, treatment, storage, arrangement for disposal, transport, recycling or
handling, of Hazardous Substances.

“Environmental Liability” means all liabilities, obligations, damages, losses,
claims, actions, suits, judgments, orders, fines, penalties, fees, expenses and
costs, including: (i) remediation costs, engineering costs, environmental
consultant fees, laboratory fees, permitting fees, investigation costs and
defense costs and attorneys’ fees and expenses; (ii) any claims, demands, and
causes of action relating to or resulting from any personal or bodily injury
(including but not limited to wrongful death, pain, suffering and loss of
consortium), property damage (real or personal) (including but not limited to
nuisance, trespass and diminution of value) or natural resource damage; and
(iii) any penalties, fines or costs of any kind associated in any way with the
failure to comply with any Environmental Law in effect as of the Effective Date.

 

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“Environmental Permits” means the permits, licenses, consents, approvals, and
other governmental authorizations with respect to Environmental Laws required
for the operation of the Generating Facility.

“ERCOT” means the Electric Reliability Council of Texas and any successor
entity.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“FERC” means the Federal Energy Regulatory Commission.

“GAAP” shall have the meaning set forth in Section 1.2.

“Generating Facility” shall have the meaning set forth in the recitals.

“Governmental Authority” means any court, or administrative or regulatory agency
or commission, or other governmental entity or instrumentality, whether
domestic, foreign or supranational, or any department thereof.

“Hazardous Substances” means (i) any petrochemical or petroleum products, crude
oil or any fraction thereof, ash, radioactive materials, radon gas, asbestos in
any form or concentration, urea formaldehyde foam insulation, or polychlorinated
biphenyls in any concentration, (ii) any chemicals, materials, substances or
wastes defined as, included in, or alleged or determined by any Person or
Governmental Authority to be included in the definition of “hazardous
substances,” “hazardous wastes,” “hazardous materials,” “restricted hazardous
materials,” “extremely hazardous substances,” “toxic substances,” “PCBs,”
“contaminants,” “asbestos” or “pollutants” or similar term in any Environmental
Law, (iii) any other chemical, material, substance or waste that is prohibited,
limited or regulated by any Environmental Law, or (iv) any noise,
electromagnetic radiation, and any other substance or energy that causes or is
alleged to cause any Environmental Liability.

“Hired Employees” shall have the meaning set forth in Section 5.10(a).

“HSR Act” means the Hart Scott Rodino Antitrust Improvements Act of 1976, as
amended.

“Income Tax” means any federal, state, local or foreign Tax or surtax (i) based
upon, measured by or calculated with respect to gross or net income, profits or
receipts, any and all municipal gross receipt Taxes, capital gains Taxes and
minimum Taxes, or (ii) based upon, measured by or calculated with respect to
multiple bases (including corporate franchise Taxes if resulting in a larger tax
liability than the non-income component of the corporate franchise Tax) if one
or more of the bases on which such Tax may be based, measured by or calculated
with respect to, is described in clause (i).

“Indemnifiable Loss” shall have the meaning set forth in Section 7.1(a).

 

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“Indemnification Cap” shall have the meaning set forth in Section 7.2(b).

“Indemnifying Party” shall have the meaning set forth in Section 7.1(c).

“Indemnitee” shall have the meaning set forth in Section 7.1(c).

“IRS” means the United States Internal Revenue Service.

“Knowledge” means (i) with respect to Seller, the actual knowledge (without
independent inquiry) of the following individuals: Randy Cormier, Mike Grady,
Jim Tharp, Paul Czervinske, Barb Irwin and Amy Jolley, and (ii) with respect to
Buyer, the actual knowledge (without independent inquiry) of Mark Kubow.

“Lyondell Consents” means any consent of Lyondell Chemical Company that may be
required due to the Conversion or change in control of the Company or change in
the operator of the Generating Facility under that certain Steam and Electric
Power Sales Agreement effective January 1, 2007, by and between the Company and
Lyondell Chemical Company and, if applicable, the waiver by Lyondell Chemical
Company of its “last right of refusal” thereunder with respect to the
transaction contemplated by this Agreement.

“Material Adverse Effect” means any change or effect on the operation of the
Business that is materially adverse to the Business taken as a whole, other than
(i) any change or effect resulting from changes in the international, national,
regional or local wholesale or retail energy, capacity or ancillary services
electric power markets, (ii) any change or effect resulting from changes in the
international, national, regional or local markets for fuel, (iii) any change or
effect resulting from changes in the national, regional or local electric
transmission systems, (iv) any change or effect resulting from any bid cap,
price limitation, market power mitigation measure, or other regulatory or
legislative measure in respect of transmission services, rights or access or the
wholesale or retail energy, capacity or ancillary services markets adopted or
approved (or failed to be adopted or approved) by the PUC (or FERC, if
applicable) or any other Governmental Authority or proposed (or failed to be
adopted or proposed) by any Person, (v) any change or effect resulting from any
regulation, rule, procedure or order adopted or proposed by or with respect to,
or related to, any regional transmission operator or independent system
operator, (vi) any change or effect resulting from any action or measure taken
or adopted, or proposed to be taken or adopted, by any local, state, regional,
national or international reliability organization, (vii) any change resulting
from the termination or modification of any Contract by Buyer following the
Closing as permitted by this Agreement, (viii) any changes in law, or any
judgments, orders or decrees that apply generally to similarly situated Persons,
(ix) the commencement or escalation of a war, armed hostility, or any other
national or international crisis or other national or international calamity,
including acts of terrorism, directly or indirectly affecting the United States,
(x) changes in GAAP, (xi) any materially adverse change in or effect on the
Business that is cured before the Closing Date (which cure for purposes hereof
shall include any reduction in the Purchase Price substantially equal to the
reduction in value of the Business resulting from such change or effect), and
(xii) any change or effect relating to a casualty or condemnation event for
which a remedy is provided in Sections 5.12 or 5.13.

“Membership Interests” shall have the meaning set forth in the recitals.

 

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“Neutral Auditors” shall have the meaning set forth in Section 2.2(b).

“Notice of Disagreement” shall have the meaning set forth in Section 2.2(b).

“Operating Records” means all data, information, books, operating records,
operating, safety and maintenance manuals, engineering and design plans,
blueprints and as-built plans, specifications, drawings, reports, procedures,
facility compliance plans, test records and results, other records and filings
made with regulatory agencies regarding operations at the Generating Facility,
environmental procedures and similar records of Seller or its Affiliates
necessary for the operation of the Business of the Company, to the extent in the
possession of Seller or its Affiliate, other than the accounting books and
records of Seller, or its Affiliates and such items proprietary to third parties
or that relate to Employees; provided, however, that Seller shall be permitted
to retain copies, or originals to the extent it provides Buyer with copies of
same, of all Operating Records.

“Organizational Documents” means (i) with respect to a corporation or company,
the articles or certificate of incorporation or association and bylaws, or
similar operational documents, (ii) with respect to a limited partnership, the
certificate of limited partnership (or equivalent document) and partnership
agreement or similar operational agreement, and (iii) with respect to a limited
liability company, the articles of organization (or equivalent document) and
regulations, limited liability company agreement, or other operational
agreement.

“Owner Affiliates” means Dynegy Power Holdings Inc. and DPC II, Inc.

“Party” shall have the meaning set forth in the preamble.

“Per Claim Deductible” shall have the meaning set forth in Section 7.2(a).

“Permits” means the permits, licenses, consents, approvals and other
governmental authorizations (other than with respect to Environmental Laws) of
the Company relating to the ownership or operation of the Generating Facility
and the Business.

“Permitted Exceptions” means (i) all exceptions, restrictions, easements,
charges, rights-of-way and monetary and non-monetary encumbrances set forth in
any Permits or Environmental Permits, (ii) statutory liens for current Taxes or
assessments not yet due or delinquent or the validity of which is being
contested in good faith by appropriate proceedings, (iii) mechanics’, carriers’,
workers’, repairers’ and other similar liens arising or incurred in the ordinary
course of business relating to obligations as to which there is no default on
the part of the Company or the validity of which are being contested in good
faith by appropriate proceedings, (iv) purchase money security interests in
respect of personal property arising or incurred in the ordinary course of
business, (v) zoning, entitlement, conservation restriction and other land use
and environmental regulations by Governmental Authorities, (vi) Encumbrances of
record (other than Encumbrances securing indebtedness for borrowed money other
than those covered by clause (viii) below) or Encumbrances otherwise disclosed
to Buyer in the Agreement with respect thereto, (vii) restrictions and
regulations imposed by any regional transmission operator or independent system
operator, any Governmental Authority or any local, state, regional, national or
international reliability council, (viii) any Encumbrances released or otherwise
terminated at or prior to Closing, and (ix) such other Encumbrances or
imperfections in or failure of title that would not, individually or in the
aggregate, materially and adversely affect the conduct of the Business.

 

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“Person” means any individual, partnership, limited liability company, joint
venture, corporation, trust, unincorporated organization, or Governmental
Authority.

“PUC” means the Texas Public Utilities Commission.

“Purchase Price” shall have the meaning set forth in Section 2.2.

“Release” means any release, spill, emission, emanation, leaking, dumping,
injection, pouring, deposit, disposal, discharge, dispersal, leaching or
migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.

“Required Regulatory Approvals” means with respect to a Party, any consent or
approval of, filing with, or notice to, any Governmental Authority that is
necessary for the execution and delivery of the Agreement by such Party or the
consummation thereby of the transactions contemplated hereby.

“Restoration Cost” shall have the meaning set forth in Section 5.12(a).

“Restraints” shall have the meaning set forth in Section 6.1(c).

“Retained Affiliate” means any Affiliate of Seller except for the Company.

“Retained Software License Agreements and Hardware” shall have the meaning set
forth in Section 2.1(c)(iii).

“Seller” shall have the meaning set forth in the preamble.

“Seller Indemnitees” shall have the meaning set forth in Section 7.1(b).

“Seller Required Regulatory Approvals” shall have the meaning set forth in
Section 3.3(b).

“Seller’s Policies” shall have the meaning set forth in Section 5.12(b).

“Tax Return” means any return, report, information return or other document
(including any related or supporting information) required to be supplied to any
authority with respect to Taxes, including amendments thereto.

“Taxes” means all taxes, surtaxes, charges, fees, levies, penalties or other
assessments imposed by any United States Federal, state or local or foreign
taxing authority, including Income Taxes, excise, property, sales, transfer,
franchise, special franchise, payroll, recording, withholding, social security
or other taxes, or any liability for taxes incurred by reason of joining in the
filing of any consolidated, combined or unitary Tax Returns or any amounts paid
to a governmental authority that are in lieu of or based upon any taxes, in each
case including any interest, penalties or additions attributable thereto;
provided, however, that “Taxes” shall not include sewer rents or charges for
water.

 

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“Technology Transfer Agreement” means the Technology Transfer Agreement to be
executed at Closing by Dynegy Operating Company in the form of Exhibit B
attached hereto.

“Termination Date” shall have the meaning set forth in Section 8.1(b).

“Third Party Claim” shall have the meaning set forth in Section 7.3(a).

“Transfer Taxes” shall have the meaning set forth in Section 5.6(a).

“Transition Services Agreement” means the Transition Services Agreement to be
executed at Closing by Dynegy Power Marketing Inc. and Dynegy Marketing and
Trade (a Colorado general partnership), on the one hand, and Buyer and the
Company, on the other hand, in the form of Exhibit C attached hereto.

“Wells Fargo” means Wells Fargo Bank, National Association.

“Working Capital Adjustment” shall have the meaning set forth in Section 2.2(b).

“Working Capital Statement” shall have the meaning set forth in Section 2.2(b).

Section 1.2 Accounting Terms. Any accounting terms used in this Agreement shall,
unless otherwise specifically provided, have the meanings customarily given them
in accordance with United States generally accepted accounting principles
(“GAAP”) and all financial computations hereunder or thereunder shall, unless
otherwise specifically provided, be computed in accordance with GAAP
consistently applied.

Article 2

Purchase and Sale; Closing

Section 2.1 Purchase and Sale of Membership Interests; Assumption of Assigned
Contracts.

(a) At the Closing, upon the terms and subject to the conditions set forth in
this Agreement, Seller shall cause the Owner Affiliates to sell, transfer,
convey, assign and deliver to Buyer or its designated Affiliate, and Buyer or
its designated Affiliate shall acquire and purchase from Seller and the Owner
Affiliates, all of the issued and outstanding Membership Interests of the
Company; provided, however, that, if applicable, the designation by Buyer of an
Affiliate to acquire such Membership Interest shall not invalidate or be
inconsistent with the terms of the Lyondell Consents.

(b) At the Closing, Buyer agrees to cause the Company or an Affiliate of the
Company designated by Buyer to assume or accept the novation of the contracts
set forth on Schedule 2.1(b) (the “Assigned Contracts”) from the Retained
Affiliate that is a party to the Assigned Contract, and Seller agrees to cause
each Retained Affiliate to transfer all of its rights and obligations under the
Assigned Contracts by assignment or novation relating to the period from and
after Closing Date to the Company or an Affiliate of the Company designated by
the Buyer.

 

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(c) Notwithstanding anything to the contrary contained herein or otherwise, the
following items shall be retained by, or transferred to Seller or its designated
Retained Affiliate at or prior to Closing:

(i) any insurance policies, insurance proceeds, insurance refunds and prepaid
insurance premiums relating to the period prior to the Closing;

(ii) any of Seller’s employee personnel files;

(iii) the hardware and enterprise software set forth on Schedule 2.1(c)(iii)
(the “Retained Software License Agreements and Hardware”); and

(iv) all rights and obligations under the Assigned Contracts relating to periods
prior to the Closing Date.

Section 2.2 Purchase Price.

(a) The purchase price for the Membership Interests of the Company shall be Four
Hundred Sixty-Seven Million Five Hundred Thousand Dollars ($467,500,000)
(subject to adjustments, if any, expressly provided hereunder, the “Purchase
Price”). At the Closing, Buyer will pay or cause to be paid to Seller, by wire
transfer of immediately available funds to an account or accounts previously
designated in writing by Seller, an amount in United States dollars equal to the
Purchase Price.

(b) As promptly as practicable, but in no event later than ninety (90) days
after the Closing, Seller shall cause to be prepared and delivered to Buyer
(i) a written calculation of Actual Working Capital of the Company, which shall
be prepared in accordance with GAAP consistently applied (the “Working Capital
Statement”), and (ii) a calculation of the adjustment to the Purchase Price (the
“Working Capital Adjustment”), as determined in accordance with this
Section 2.2(b). Buyer shall provide Seller and its agents and representatives
any information reasonably requested and, upon reasonable notice, full access at
all reasonable times to the properties, books, records, and other materials of
the Company as Seller may reasonably request in connection with its preparation
of the Working Capital Statement and Working Capital Adjustment. The Purchase
Price shall be adjusted (x) downward by the amount by which the Actual Working
Capital of the Company is less than $0.00, in which case Seller shall pay the
shortfall amount to Buyer, or (y) upward by the amount by which the Actual
Working Capital of the Company is greater than $0.00, in which case Buyer shall
pay the excess amount to Seller. The Buyer shall have ten (10) days following
receipt of the Working Capital Statement and the Working Capital Adjustment to
notify Seller in writing (the “Notice of Disagreement”) of any dispute relating
to the preparation of the Working Capital Statement or the calculation of Actual
Working Capital and the Working Capital Adjustment. The Notice of Disagreement
shall set forth with specificity the nature and extent of the Buyer’s dispute.
Thereafter, Buyer and Seller shall attempt in good faith to resolve the disputed
items and finally determine the Actual Working Capital and the Working Capital
Adjustment. If Buyer and Seller are unable to resolve the disagreement within
twenty (20) days after delivery of the Notice of

 

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Disagreement, then such amounts remaining in dispute shall be submitted to an
independent nationally-recognized accounting firm, mutually agreeable to Buyer
and Seller (the “Neutral Auditors”). The Neutral Auditors shall act as an
arbitrator to determine, based solely on the provisions of this Section 2.2(b)
and the presentations by the Buyer and the Seller, and not by independent
review, only those issues still in dispute. The Neutral Auditors’ determination
shall be made within twenty (20) days of the dispute being submitted for their
determination, shall be set forth in a written statement delivered to the Buyer
and Seller and shall be final, non-appealable and binding on the parties hereto,
absent manifest error or fraud. A judgment of a court of competent jurisdiction
may be entered upon the Neutral Auditors’ determination. The fees, costs and
expenses of the Neutral Auditors shall be borne equally by the Buyer, on the one
hand, and by the Seller, on the other hand. The Working Capital Adjustment shall
become final as of the date of the notice of determination delivered by the
Neutral Auditors, absent manifest error or fraud. Any payment to be made
pursuant to this Section 2.2(b) shall be made within three (3) Business Days
following the date the Working Capital Adjustment becomes final in immediately
available funds by wire transfer to such bank account as Seller or Buyer will
specify, as applicable.

(c) The Parties have been unable to agree as to the value attributable to the
2008 Vintage NOx Allowances that will be allocated to the Generating Facility,
and as a result have agreed to implement the following adjustment to the
Purchase Price. No later than fifteen days following the Company’s submission to
the TCEQ of its report under the Mass Emission Cap and Trade Program detailing
the aggregate NOx emissions of the Generating Facility for the 2007 Control
Period, Buyer shall cause the Company to transfer to Seller an amount of 2008
Vintage NOx Allowances equal to the positive difference, if any, of (i) the
aggregate 2008 Vintage NOx Allowances allocated to the Generating Facility
(currently expected to be 631.7 tons of NOx allowances), less (ii) an amount
equal to 102% of the aggregate tons of NOx emitted by the Generating Facility
during the 2007 Control Period, as reported to the TCEQ by the Company. For
purposes of this Section 2.2(c), (i) “TCEQ” means the Texas Commission on
Environmental Quality, (ii) “2008 Vintage NOx Allowances” means NOx allowances
allocated to the Generating Facility by the TCEQ in respect of the 2008 Control
Period, (iii) “2007 Control Period” means the 2007 calendar year and (iv) “2008
Control Period” means the period established by the TCEQ for 2008 in respect of
which the Generating Facility must monitor its emissions of NOx under the Mass
Emission Cap and Trade Program administered by the TCEQ with respect to the
Houston/Galveston nonattainment area (currently expected to be the 2008 calendar
year). Seller and Buyer agree to treat the transfer contemplated by this
Section 2.2(c) as an adjustment to the Purchase Price.

Section 2.3 Allocation of Purchase Price. The Purchase Price shall be allocated
among the Company Assets as of the Closing in accordance with a schedule to be
prepared by Buyer, using the allocation method provided by Section 1060 of the
Code and the regulations thereunder and the Parties shall cooperate to comply
with all substantive and procedural requirements of Section 1060 of the Code and
the regulations thereunder. In that regard, Buyer shall provide Seller with
Buyer’s proposed allocation of the Purchase Price among the Company Assets as
soon as practicable after, and in no event later than sixty (60) days after, the
Closing. Seller shall then consult with Buyer regarding such allocation and
propose any adjustments within a reasonable time thereafter. If Buyer and Seller
are unable to agree on such allocation, Buyer and Seller may allocate the
Purchase Price as each Party determines using the allocation method provided by
Section 1060 of the Code and the regulations thereunder.

 

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Section 2.4 Time and Place of Closing. Upon the terms and subject to the
satisfaction of the conditions contained in Article 6, the closing of the
purchase and sale of the Membership Interests (the “Closing”) shall take place
on such date as the Parties may agree, which date shall be as soon as
practicable, but no later than ten (10) Business Days following the date on
which all of the conditions set forth in Article 6 have been satisfied or
waived, at 10:00 a.m., local time, at Seller’s offices at 1000 Louisiana, Suite
5800, Houston, Texas 77002, or at such other place or time as the Parties may
agree. The date on which the Closing actually occurs is hereinafter referred to
as (the “Closing Date”); provided, however, that if the Closing occurs and
Buyer’s payments made pursuant to Section 2.2 hereof are not received on such
date prior to 4:00 p.m., local time, in the accounts designated by Seller
pursuant to Section 2.2, then the Closing Date shall be the immediately
following Business Day. The time at which the Closing shall be deemed effective
shall be midnight on the Closing Date. For the avoidance of doubt, “midnight”
means the end of the day on the Closing Date.

Section 2.5 Closing

(a) At the Closing, Buyer shall execute (as applicable) and deliver the
following items to Seller:

(i) the Purchase Price by wire transfer in immediately available funds as set
forth in Section 2.2 above;

(ii) an executed counterpart of one or more assignment and assumption or
novation agreements, providing for the effective assignment or novation of each
Assigned Contract from the Retained Affiliate that is a party thereto (the
“Assignor”) to the Company or an Affiliate of the Company designated by Buyer
(as applicable, the “Assignee”), and Assignee’s assumption (by novation or
otherwise) of Assignor’s obligations relating to the period from and after the
Closing Date under such Assigned Contract (each an “Assignment and Assumption
Agreement”);

(iii) replacement letters of credit or other credit support arrangements
necessary for Seller and its Affiliates to be released from and to receive a
return of those letters of credit or other credit support arrangements set forth
on Schedule 2.5(a)(iii);

(iv) an executed counterpart of the Transition Services Agreement;

(v) a Certificate of Good Standing or equivalent with respect to Buyer, as of a
recent date, issued by the Secretary of State of the State of Buyer’s formation;

(vi) copies, certified by an officer of Buyer or other authorized person, of
resolutions of Buyer’s Board of Directors authorizing the execution and delivery
of this Agreement and all other agreements and instruments, in each case, to be
executed and delivered by Buyer in connection herewith;

 

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(vii) a certificate of an officer of Buyer or other authorized representative
identifying the name and title and bearing the signatures of Buyer’s officers
authorized to execute and deliver this Agreement and all other agreements and
instruments contemplated hereby; and

(viii) a certificate addressed to Seller dated the Closing Date executed by
Buyer’s duly authorized officer or other authorized representative the effect
that Buyer has satisfied the conditions set forth in Section 6.3(a) and (b).

(b) At the Closing, Seller shall execute and deliver, and will cause each of its
applicable Affiliates to execute (as applicable) and deliver, the following
items to Buyer:

(i) an assignment of the Membership Interests Company in form sufficient to
transfer all rights, title and interest in and to the Membership Interests to
Buyer;

(ii) counterparts executed by each Assignor to each Assignment and Assumption
Agreement referenced in Section 2.5(a)(ii);

(iii) the Technology Transfer Agreement executed by Dynegy Operating Company and
the Company;

(iv) a counterpart of the Transition Services Agreement executed by Dynegy Power
Marketing, Inc. and Dynegy Marketing and Trade;

(v) the Buyer Letter of Credit;

(vi) certificates of existence and good standing with respect to Seller and the
Company, and the Retained Affiliates identified on Schedule 3.4, as of a recent
date, issued by the Secretary of State of their respective states of
organization;

(vii) copies, certified by Seller’s Secretary or Assistant Secretary, of
resolutions of Seller’s Board of Directors authorizing the execution and
delivery of this Agreement and all other agreements and instruments, in each
case, to be executed and delivered by Seller in connection herewith;

(viii) a certificate addressed to Buyer dated the Closing Date executed by
Seller’s duly authorized officers to the effect that Seller has satisfied the
conditions set forth in Section 6.2(a) and (b);

(ix) a duly executed certificate of Seller’s non-foreign status pursuant to
Section 1445 of the Code and Sections 1.1445-2(b) and (c) of the Treasury
Regulations thereunder, executed by Seller or its tax parent Affiliate, as
applicable;

(x) evidence reasonably satisfactory to Buyer of the occurrence of the
Conversion, including canceled stock certificates with respect to CoGen Lyondell
Inc.;

 

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(xi) to the extent title is not then held in the name of the Company, as
applicable, such assignment or title transfer documentation as may be necessary
to transfer to Buyer or to the Company or other designee of Buyer, the vehicles
and other tangible assets, if any, described on Schedule 3.6(c).

Article 3

Representations and Warranties of Seller

Except as specifically set forth in Seller’s Disclosure Schedule attached
hereto, Seller hereby represents and warrants to Buyer that all of the
statements contained in this Article 3 with respect to it and the Company are
true and correct as of the date hereof. Each exception and other response to
this Agreement set forth in Seller’s Disclosure Schedule refers to, or is
grouped under a heading referring to, the specific section or subsection of this
Agreement to which it relates and to any other representation or warranty as to
which it specifically referenced or it is reasonably apparent that such
disclosure is also being made for purposes of such other representation or
warranty.

Section 3.1 Organization; Qualification. Each of Seller, the Owner Affiliates
and the Company is duly organized, validly existing, and in good standing under
the laws of the state of its formation and has all requisite power and authority
to own, lease and operate all of its properties and assets and to carry on its
business as currently conducted. Each of Seller, the Owner Affiliates and the
Company is qualified to do business and is in good standing in the states
required for it (i) in the case of Seller and the Owner Affiliates, to perform
its obligations hereunder and, (ii) in the case of the Company, to operate the
Business.

Section 3.2 Authority Relative to This Agreement. Seller has all necessary power
and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. Seller’s execution and delivery of this
Agreement and Seller’s consummation of the transactions contemplated hereby have
been duly and validly authorized by all necessary action. This Agreement has
been duly and validly executed and delivered by Seller and, assuming that this
Agreement constitutes a valid and binding agreement of Buyer, subject to the
receipt of the Seller Required Regulatory Approvals and the Buyer Required
Regulatory Approvals, this Agreement constitutes the valid and binding agreement
of Seller, enforceable against Seller in accordance with its respective terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditor’s rights and remedies and general principles of
equity.

Section 3.3 No Violation; Consents and Approvals.

(a) Except as set forth on Schedule 3.3(a) and except for the Lyondell Consents,
subject to obtaining the Seller Required Regulatory Approvals and the Buyer
Required Regulatory Approvals, neither the execution and delivery by Seller of
this Agreement nor the consummation by Seller of any of the transactions
contemplated hereby will (i) conflict with or result in a breach of any
provision of the Organizational Documents of Seller, the Company or the Owner
Affiliates, (ii) result in a default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, license, agreement, lease or other
instrument or obligation to which either Seller or the

 

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Company is a party, except (x) for such defaults (or rights of termination,
cancellation or acceleration) as to which requisite waivers or consents have
been obtained or that would not, individually or in the aggregate, reasonably be
expected to create a Material Adverse Effect or (y) for those requirements that
become applicable to Seller or the Company as the result of a specific
regulatory status of Buyer (or any of its Affiliates) or as a result of any
other facts that specifically relate to the business or activities in which
Buyer (or any of its Affiliates) is or proposes to be engaged, or (iii) violate
any order, writ, injunction, decree, law, statute, rule or regulation applicable
to Seller or the Company, except for such violations that would not,
individually or in the aggregate, reasonably be expected to create a Material
Adverse Effect.

(b) Except for (i) the filings by Seller and Buyer required by the HSR Act and
the expiration or earlier termination of all waiting periods under the HSR Act,
and (ii) the Required Regulatory Approvals set forth on Schedule 3.3(b) attached
hereto (collectively, the “Seller Required Regulatory Approvals”), no
declaration, filing or registration with, notice to, or authorization, consent,
or approval of, any Governmental Authority is necessary for the consummation by
Seller or the Company of the transactions contemplated hereby, other than such
declarations, filings, registrations, notices, authorizations, consents, or
approvals that, if not obtained or made, would not, individually or in the
aggregate, reasonably be expected to create a Material Adverse Effect.

Section 3.4 Capitalization and Ownership.

(a) Schedule 3.4 sets forth all of the issued and outstanding equity interests
of the Company as of the Effective Date and all of the issued and outstanding
equity interests of the Company that will be outstanding upon consummation of
the Conversion. Upon the consummation of the Conversion, all Membership
Interests of the Company will be duly authorized, validly issued, fully paid and
nonassessable. The consummation of the purchase and sale transaction
contemplated by this Agreement will convey to Buyer good and valid title to all
of the Membership Interests, free and clear of all Encumbrances, other than
Encumbrances arising by, through or under Buyer, and restrictions under
applicable securities laws. Neither Seller nor any Owner Affiliate has granted
to any Person any option, right or privilege for the purchase, subscription,
allotment or issue of any unissued interests, units or other securities
(including convertible securities, warrants or convertible obligations of any
nature) of the Company other than Buyer’s rights under this Agreement.

(b) The Company has no subsidiaries and does not own equity interests in any
Person.

Section 3.5 Certain Contracts and Arrangements.

(a) Except for (i) Contracts listed on Schedule 3.5(a), (ii) Contracts that will
expire or be discharged prior to or as of the Closing Date, and (iii) Contracts
that are permitted to be entered into under this Agreement, none of Seller, the
Company or their respective Affiliates are parties to any contract that is
material to the operation of the Business of the Company (including as to any
Tax matters). Each Contract listed on Schedule 3.5(a) (i) constitutes a valid
and binding obligation of the Company and, to the Knowledge of Seller, of the
other parties thereto, and (ii) to the Knowledge of Seller, is in full force and
effect.

 

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(b) The Company is not in material breach of or material default under any
Contract listed on Schedule 3.5(a) and, to the Knowledge of Seller, no other
party to the Contracts listed on Schedule 3.5(a) is in material breach or
material default thereunder. Except as set forth on Schedule 3.5(b), neither
Seller, nor any of its Affiliates, nor the Company has received any written
notices purporting to assert a default, event of default or right to terminate
under any Contract that is material to the operation of the Business of the
Company.

(c) Except as set forth on Schedule 3.5(c), there are no Contracts to which the
Company, on the one hand, and Seller or any of its Retained Affiliates, on the
other hand, are parties.

Section 3.6 Title to Properties and Related Matters.

(a) The Company does not own any fee interests in real property. Schedule 3.6(a)
sets forth all leaseholds or other material interests in real property or other
land use rights owned by the Company.

(b) The Company has good title to, or rights by license, lease or other
agreement to use, all personal properties and assets (or rights thereto)
necessary to permit it to conduct its Business as currently conducted, except as
would not, individually or in the aggregate, reasonably be expected to create a
Material Adverse Effect.

(c) The Business of the Company is the only business operation carried on by the
Company. Except for any tangible assets described in Section 2.1(c) or on
Schedule 3.6(c), the Company Assets owned, leased, licensed or contracted by the
Company constitute all of the tangible assets that are sufficient to operate
(without regard to the condition of the buildings, equipment, any other fixed
assets, or tangible personal property) its Business as currently operated,
except for tangible assets the omission of which would not, in the aggregate,
reasonably be expected to create a Material Adverse Effect.

Section 3.7 Legal Proceedings. Except as set forth on Schedule 3.7, (a) there
are no claims, actions, proceedings or investigations (including condemnation
proceedings) pending or, to the Knowledge of Seller, threatened against the
Company or before any Governmental Authority that would, individually or in the
aggregate, reasonably be expected to create a Material Adverse Effect and
(b) neither Seller nor the Company is, subject to any outstanding judgment,
order, writ, injunction or decree of any Governmental Authority that would
reasonably be expected to create a Material Adverse Effect. The representations
and warranties of Seller set forth in this Section 3.7 shall not apply to, and
do not cover, any environmental matters, which representations and warranties of
Seller are exclusively governed by Section 3.9.

Section 3.8 Permits; Compliance with Law. Except as set forth on Schedule 3.8:

(a) The Company holds, and is in compliance with, all Permits necessary to
conduct the Business of the Company as currently conducted, and, to the
Knowledge of Seller, the Company is otherwise in compliance with all laws,
statutes, orders, rules, regulations, ordinances or judgments of any
Governmental Authority applicable to the operation of the Business of the
Company, except for such failures to comply with such Permits, or such failures
to be in compliance with such laws, statutes, orders, rules, regulations,
ordinances or judgments, that would not, individually or in the aggregate,
reasonably be expected to create a Material Adverse Effect.

 

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(b) None of Seller or the Company has received any written notification that it
is in violation of any of such Permits or laws, statutes, orders, regulations,
ordinances or judgments, except for notifications of violations that would not,
individually or in the aggregate, reasonably be expected to create a Material
Adverse Effect. The representations and warranties of Seller set forth in this
Section 3.8 shall not apply to, and do not cover, any environmental matters
that, with respect to any representations and warranties of Seller are
exclusively governed by Section 3.9 herein.

Section 3.9 Environmental Matters. Except as set forth on Schedule 3.9:

(a) The Company holds, and is in compliance with, the Environmental Permits
required for the Company to conduct its Business as currently conducted under
applicable Environmental Laws, and, to the Knowledge of Seller, the Company is
otherwise in compliance with applicable Environmental Laws on the date hereof
with respect to the operation of its Business, except for such failures to hold
or comply with such Environmental Permits, or such failures to be in compliance
with such applicable Environmental Laws on the date hereof, that would not,
individually or in the aggregate, reasonably be expected to create a Material
Adverse Effect.

(b) Neither Seller nor the Company has received any written notice of a
violation, proceeding or investigation of any Environmental Law, or been
notified that it is a potentially responsible party under the Federal
Comprehensive Environmental Response, Compensation, and Liability Act or any
similar state law with respect to any real property of the Company, except for
such matters under such Environmental Laws as would not, individually or in the
aggregate, reasonably be expected to create a Material Adverse Effect.

(c) The Company is not subject to any outstanding judgment, decree or judicial
order relating to compliance with any Environmental Law or to investigation or
cleanup of Hazardous Substances under any applicable Environmental Law, except
for any such judgments, decrees or judicial orders that would not, individually
or in the aggregate, reasonably be expected to create a Material Adverse Effect.

(d) Neither Seller nor the Company has received written notice of claims,
actions, proceedings or investigations, nor to the Knowledge of Seller, are any
claims, actions, proceedings or investigations threatened against or relating to
the operation of the Business of the Company with respect to the exposure of any
Person to Hazardous Substances by the Company, except for any such claims,
actions, proceedings or investigations that, if adversely determined, would not,
individually or in the aggregate, reasonably be expected to create a Material
Adverse Effect.

(e) There are no Environmental Conditions that would, individually or in the
aggregate, reasonably be expected to create a Material Adverse Effect.

The representations and warranties made in this Section 3.9 are the exclusive
representations and warranties of Seller relating to environmental matters.

 

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Section 3.10 Taxes.

(a) To the best of Seller’s Knowledge, (i) all Tax Returns required to be filed
have been timely filed or caused to be timely filed by the Company, (ii) all
Taxes shown to be due on such Tax Returns and all Taxes otherwise owed have been
paid in full, and (iii) such Tax Returns are correct as to all material matters.
No written notice of deficiency or assessment or threatening an audit relating
to Taxes has been received by the Company from any taxing authority with respect
to liabilities for Taxes of such Company that have not been fully paid or
finally settled or that are not being contested through appropriate proceedings.
Except as set forth on part (a) of Schedule 3.10, there are no outstanding
agreements or waivers extending the applicable statutory periods of limitation
relating to Taxes of the Company for any period.

(b) Except as set forth on part (b) of Schedule 3.10, the Company is not liable
for any Taxes of another person as a successor, transferee, by indemnity, by
contract or otherwise (except for any liability pursuant to Treas. Reg. 1.1502-6
or any similar provision of state or local Tax law for a member of an Affiliated
Group the common parent of which is Dynegy Inc.).

(c) As of the Closing Date, the Company will be taxed and characterized for U.S.
federal income tax purposes as a partnership.

Section 3.11 Brokers. No broker, finder or other Person is entitled to any
brokerage fees, commissions, or finder’s fees in connection with the transaction
contemplated hereby by reason of any action taken by Seller or its Affiliates,
except that Seller has employed J.P. Morgan Securities Inc. as its financial
advisors pursuant to engagement letters with Seller and Seller shall be liable
for all amounts payable to J.P. Morgan pursuant to such engagement letters.

Section 3.12 Insurance. All material policies of fire, liability and other forms
of insurance purchased or held by, for the benefit of, and insuring the Company
or their respective assets, businesses, operations, or employees are valid,
enforceable, in full force and effect, all premiums with respect thereto
covering all periods up to and including the date hereof have been paid, and no
notice of termination, non-renewal, or denial has been received with respect to
any such policy that was not replaced on substantially similar terms prior to
the date of such cancellation.

Section 3.13 Employees.

(a) The Company does not have any employees and does not have any liability with
respect to a “multiemployer plan” (as such term is defined in Section 3(37) of
ERISA). Seller has listed on Schedule 3.13(a), and made available to Buyer
copies of, each Benefit Plan (including each employment, retention, severance,
change in control or similar agreement or plan) and has identified on Schedule
3.13(a) each such Benefit Plan with respect to which the Company or Buyer could
have any liability after the Closing Date. Each Benefit Plan with respect to
which the Company or Buyer could have any liability after the Closing Date is in
substantial compliance with all applicable laws and has been administered and
operated in all material respects in accordance with its terms. All
contributions or other amounts the Company was required to make under the terms
of the Benefit Plans have been paid in a timely manner in

 

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accordance with applicable law. None of the Company, Buyer or any Affiliate of
Buyer will have any liability under Title IV of ERISA with respect to any
Benefit Plan after the Closing Date. The transactions contemplated by this
Agreement will not increase any compensation or benefits of any Employees under
any Benefit Plan or increase or otherwise result in any liability of the Company
or Buyer with respect to any Benefit Plan (including under any employment,
retention, severance, change in control or similar agreement or plan).

(b) Schedule 3.13(b) sets forth the names and positions of all Employees as of
the Effective Date and identifies whether such Employees are actively employed
or on leave and whether any such Employees are subject to any employment
agreements. Seller has provided to Buyer a spreadsheet dated May 25, 2007 that
sets forth the salary, bonuses, base hours, service date and vacation benefits
levels for all such Employees as of the Effective Date. To the Knowledge of
Seller, none of the Employees are subject to any non-competition or similar
covenants or other arrangements or restrictions that would prohibit the Employee
from working for the Company, Buyer or any of their Affiliates after the Closing
Date. Nothing in this Section 3.13 or this Agreement shall require Seller, its
Affiliates or the Company to provide Buyer or its Affiliates copies of or access
to information contained in any of Seller’s or its Affiliates’ employee records
or personnel files.

(c) To Seller’s Knowledge, none of Seller, the Company or any Retained
Affiliate: (i) is a party to or bound by any collective bargaining agreements or
other similar labor contracts affecting the Employees, (ii) has any active union
organizing activity with respect to the Business, or (iii) has any actually
pending labor strike, walk-out, dispute, work-stoppage, lockout, arbitration or
grievance proceeding relating to the Employees or to the Business, in each case,
which would reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect.

Section 3.14 Absence of Certain Changes. Except as set forth on Schedule 3.14,
since December 31, 2006, the Company has operated in the ordinary course of
business, consistent with past practices. Since December 31, 2006, there has not
been any (a) Material Adverse Effect or (b) event or condition that would
reasonably be expected to create a Material Adverse Effect or prevent or delay
Seller from consummating the transactions contemplated by this Agreement.

Section 3.15 Liabilities. Except for (a) liabilities of the Company to Seller or
Retained Affiliates that will be satisfied in full prior to or concurrently with
the Closing, and (b) as set forth on Schedule 3.15, the Company does not have
any liability in excess of $500,000.00 individually, or $5,000,000.00 in the
aggregate, that would be required to be reflected on an unaudited balance sheet
of the Company prepared in accordance with GAAP, other than current liabilities
incurred in the ordinary course of business.

Section 3.16 Balance Sheets. Seller has delivered to Buyer true and complete
copies of the unaudited balance sheet of the Company as of December 31, 2006 and
the quarter ending March 31, 2007 (the “Balance Sheets”). Such balance sheets
were prepared in accordance with GAAP using the same accounting principles,
policies and methods as have been historically used in connection with the
calculation of the items reflected thereon and fairly present in all material
respects the financial condition of the Company as of the respective dates
thereof and for the respective periods covered thereby, subject to normal
year-end adjustments and the absence of footnote disclosure.

 

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Article 4

Representations and Warranties of Buyer

Buyer represents and warrants to Seller as follows:

Section 4.1 Organization. Buyer is a limited liability company duly organized,
validly existing and in good standing under the laws of the state of its
formation and has all requisite organizational power and authority to own, lease
and operate its properties and to carry on its business as is now being
conducted. If applicable, any Affiliate of Buyer designated by Buyer pursuant to
Section 2.2(a) will, as of the Closing Date, be duly organized, validly existing
and in good standing under the laws of the state of its formation and have all
requisite organizational power and authority to own, lease and operate its
properties and to carry on its business as conducted as of the Closing Date. To
the extent it is required to do so under applicable law, as of the Closing Date
Buyer, or its designated Affiliate pursuant to Section 2.2(a) if applicable,
will be duly qualified or licensed to do business, and be in good standing in,
the State of Texas.

Section 4.2 Authority Relative to This Agreement. Buyer has all necessary
organizational power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery by
Buyer of this Agreement and the consummation by Buyer of the transactions
contemplated hereby have been duly and validly authorized by the Board of
Directors of Buyer and no other limited liability company proceedings on the
part of Buyer are necessary to authorize this Agreement or the consummation of
the transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Buyer and, assuming that this Agreement constitutes a
valid and binding agreement of Seller, or the counterparty thereto if not
Seller, subject to the receipt of the Buyer Required Regulatory Approvals and
the Seller Required Regulatory Approvals, this Agreement constitutes the valid
and binding agreement of Buyer, enforceable against Buyer in accordance with its
respective terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditor’s rights and remedies and general
principles of equity.

Section 4.3 Consents and Approvals; No Violation.

(a) Subject to obtaining the Buyer Required Regulatory Approvals and the Seller
Required Regulatory Approvals, neither the execution and delivery by Buyer of
this Agreement, nor the consummation by Buyer of any of the transactions
contemplated hereby will:

(i) conflict with or result in any breach of any provision of the Organizational
Documents of Buyer;

(ii) result in a default (or give rise to any right of termination, cancellation
or acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, agreement, lease or other instrument or
obligation to which Buyer or any of its Affiliates is a party or by which any of
their respective assets may be bound; or

 

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(iii) violate any order, writ, injunction, decree, statute, rule or regulation
applicable to Buyer, or any of its assets;

except, in the case of clauses (ii) and (iii) of this Section 4.3(a), for such
failures to obtain a necessary consent, defaults and violations that would not,
individually or in the aggregate, reasonably be expected to create a Buyer
Material Adverse Effect.

(b) Except for (i) the filings by Buyer and Seller required by the HSR Act and
the expiration or earlier termination of all waiting periods under the HSR Act,
and (ii) the Required Regulatory Approvals set forth on Schedule 4.3(b) attached
hereto (collectively, the “Buyer Required Regulatory Approvals”), no
declaration, filing or registration with, notice to, or authorization, consent,
or approval of, any Governmental Authority is necessary for the consummation by
Buyer of the transactions contemplated hereby.

Section 4.4 Availability of Funds. Buyer will have cash available at the Closing
to effect the purchase of the Membership Interests on the terms hereof.

Section 4.5 Brokers. No broker, finder or other Person is entitled to any
brokerage fees, commissions, or finder’s fees in connection with the transaction
contemplated hereby by reason of any action taken by Buyer or its Affiliates.

Section 4.6 Qualified Buyer. Without limiting the foregoing, to the Knowledge of
Buyer, there is no reason or circumstance that would prevent Buyer from
procuring the Buyer Required Regulatory Approvals.

Section 4.7 Legal Proceedings. There are no claims, actions, proceedings or
investigations pending or, to the Knowledge of Buyer, threatened, against or
relating to Buyer before any Governmental Authority that would, individually or
in the aggregate, reasonably be expected to create a Buyer Material Adverse
Effect. Buyer is not subject to any outstanding judgment, rule, order, writ,
injunction or decree of any Governmental Authority that would reasonably be
expected to create a Buyer Material Adverse Effect.

Section 4.8 Acquisition as Investment. Buyer is acquiring the Membership
Interests for its own account as an investment without the present intent to
sell, transfer or otherwise distribute the same to any other Person. Buyer
acknowledges that the Membership Interests are not registered pursuant to the
Securities Act of 1933 (the “1933 Act”) and that none of the Membership
Interests may be transferred, except pursuant to an applicable exception under
the 1933 Act. Buyer is an “accredited investor” as defined under Rule 501
promulgated under the 1933 Act.

Section 4.9 Opportunity for Independent Investigation. Prior to its execution of
this Agreement, Buyer has conducted to its satisfaction an independent
investigation and verification of the current condition and affairs of the
Company, the Business of the Company, and the Assigned Contracts. Buyer
acknowledges and affirms that is has had full access to the extent it deems
necessary to all information and materials made available by Seller, the

 

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Company and their respective Affiliates or representatives, during the course of
Buyer’s due diligence investigation of the Membership Interests and Assigned
Contracts. In making its decision to execute this Agreement, to purchase the
Membership Interests, and to assume the Assigned Contracts, Buyer has relied and
will rely solely upon the results of such independent investigation and
verification and the terms and conditions of this Agreement. As of Closing,
Buyer will have completed its investigation, verification, analysis, review and
evaluation of this Agreement, the Membership Interests, the Business, and the
Assigned Contracts as Buyer has deemed necessary or appropriate.

Article 5

Covenants of the Parties

Section 5.1 Conduct of Business.

(a) Except with the prior written consent of Buyer (such consent not to be
unreasonably withheld), as required to effect the purchase and sale of the
Membership Interests and related transactions contemplated by this Agreement or
as otherwise required by law (including Environmental Laws), during the period
from the date of this Agreement to the Closing Date, Seller will cause the
Company to operate its Business in the usual, regular and ordinary course and in
accordance with Accepted Electric Practice, and use commercially reasonable
efforts to maintain their tangible properties and facilities in good working
order, ordinary wear and tear excepted.

(b) Notwithstanding the foregoing, except as contemplated in this Agreement,
prior to the Closing Date, Seller shall not and shall not allow the Owner
Affiliates or the Company, without the prior written consent of Buyer (such
consent not to be unreasonably withheld or delayed), to:

(i) amend the organizational documents of the Company that would adversely
affect the transactions contemplated by this Agreement;

(ii) liquidate, dissolve, recapitalize, reorganize or otherwise wind up the
business or operations of the Company;

(iii) issue any new membership interests in the Company or grant any option,
right or privilege to acquire such interests, including any securities
convertible into such interests;

(iv) except for Permitted Exceptions, grant or suffer to exist any material
Encumbrance on the assets of the Company securing any indebtedness for borrowed
money or guarantee or other material liability for the obligations of any
Person;

(v) incur any material indebtedness for borrowed money which will not be
discharged on or before the Closing or enter into any guarantee of the
obligations of another Person which will be binding upon the Company after the
Closing;

 

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(vi) make any material change in the levels of supplies, materials and spare
parts inventory customarily maintained by the Company, other than consistent
with past practice;

(vii) sell, lease (as lessor), transfer or otherwise dispose of, any of its
material assets, other than assets that become obsolete or assets used, consumed
or replaced in the ordinary course of business consistent with past practice;

(viii) terminate, materially extend or otherwise materially amend any of the
Assigned Contracts or material Contracts described on Schedule 3.5(a) or waive
any default by, or release, settle or compromise any material claim against, any
other party thereto, other than in the ordinary course of business consistent
with past practices or as required by applicable law;

(ix) terminate or materially amend any Permit;

(x) enter into any material Contract for the purchase, sale or storage of fuel
(whether commodity or transportation) that would be binding upon the Company
after the Closing;

(xi) settle, compromise or enter into any agreement with respect to an audit,
investigation, assessment, reassessment, inquiry or other Tax controversy that
would reasonably be expected to materially and adversely affect the Company or
Buyer in a Tax period ending after the Closing Date;

(xii) make or commit to make any capital expenditures, except those capital
expenditures that (A) are made or committed to be made in the ordinary course of
the Company’s Business consistent with past practice, (B) consistent in all
material respects with the current budget for the Generating Facility as
previously disclosed to Buyer, (C) are approved by Buyer, or (D) are mandated by
a law or regulation of a Governmental Authority; provided, however, that, in the
case of clause (D), the Company will not make any such mandated capital
expenditures (unless their failure to do so would have an adverse impact on the
operation of the Business) if (x) such mandated capital expenditures are not
required to be made by the Company prior to the Closing Date, and (y) Buyer
assumes responsibility, at its sole cost, to make such mandated capital
expenditures after the Closing;

(xiii) enter into any material Contract with Affiliates of Seller that would be
binding on the Company after Closing;

(xiv) enter into any material Contract with respect to the assets of the Company
relating to any of the transactions prohibited by the foregoing clauses
(i) through (x);

(xv) except to the extent applicable generally to all employees of Seller and
its Affiliates, adopt, enter into, amend or terminate any Benefit Plan that is
or would be sponsored or contributed to by the Company or to which the Company
is or would be a party (including any employment, retention, change in control,
severance or similar agreement) after Closing;

 

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(xvi) increase or agree to increase the compensation or benefits (including
retirement, deferred compensation, incentive compensation, retention, severance,
change in control or other compensation or benefits) of any Employee other than
in the ordinary course of business and with the amount, timing and type of such
compensation and/or benefits being consistent with past practice, or hire any
individual who would be an Employee other than in the ordinary course of
business and with the amount and type of such individual’s compensation and
benefits being consistent with past practice; or

(xvii) enter into a collective bargaining agreement or similar labor agreement
with respect to Employees.

(c) Notwithstanding the foregoing, nothing in this Agreement shall prevent:
(i) Seller or the Company from taking commercially reasonable actions with
respect to emergency situations and regulatory requirements or other
requirements of applicable law so long as Seller shall, upon receipt of notice
of any such actions, promptly inform Buyer of any such actions taken outside the
ordinary course of business; (ii) Seller or the Company from taking actions as
are reasonably necessary to allow the Company to operate their Business (as
currently conducted and after taking into account the transactions contemplated
by this Agreement) on a stand-alone basis separate from Seller and the Retained
Affiliates, including terminating Contracts between the Company and Retained
Affiliates; and (iii) Seller or any Retained Affiliate from managing and
administering Employee relationships, including, without limitation, hiring new
Employees, transferring personnel to make them Employees, terminating,
suspending, transferring, promoting, or demoting Employees or adjusting Employee
compensation provided any such compensation adjustments are made in the ordinary
course of business consistent with past practices or as required by applicable
law.

Section 5.2 Access to Information.

(a) Between the date of this Agreement and the Closing Date, Seller and the
Company will, subject to the terms of Section 5.7 hereof, during ordinary
business hours and upon reasonable notice (i) give Buyer and its representatives
reasonable access to all books, records, plants, offices and other facilities
and properties of the Company, (ii) permit Buyer to make such reasonable
inspections thereof as Buyer may reasonably request, (iii) furnish Buyer with
such financial and operating data and other information of the Company as Buyer
may from time to time reasonably request, (iv) furnish Buyer upon request a copy
of each material report, schedule or other document with respect to the Company
filed by Seller or the Company with, or received from, any Governmental
Authority, and (v) furnish Buyer with a copy of each notice of violation or
similar correspondence from any Governmental Authority or any notice of an event
of default by the Company or the applicable counterparty with respect to any of
the Contracts listed in Schedule 3.5(a) (with all such notices and
correspondence being deemed to be Confidential Information for purposes of
Section 5.7 hereof); provided, however, that (A) any such activities shall be
conducted in such a manner as not to interfere unreasonably with the operation
of the Business, (B) Seller, the Company and their Affiliates shall not be
required to

 

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take any action that would constitute a waiver of any legal privilege, including
the attorney-client privilege or the work product doctrine and (C) Seller and
the Company need not supply Buyer with (1) any information or access that Seller
or the Company is under a legal obligation to keep confidential or (2) any
information that Seller or the Company have previously supplied to Buyer.
Notwithstanding anything in this Section 5.2 to the contrary, (i) Seller shall
not be required to provide such access to any employee records of Seller or,
subject to Section 3.13(a), any information contained therein, and (ii) Buyer
shall not have the right to perform or conduct any environmental sampling or
testing at, in, on, around or underneath the assets or operations of the
Company.

(b) Buyer agrees to indemnify and hold harmless Seller, the Company, and their
respective Affiliates and representatives for any and all liabilities, losses,
costs or expenses incurred by them or their representatives arising out of the
access rights under this Section 5.2, including any claims by any of Buyer’s
representatives for any injuries or property damage while present on the
facilities or property of any of the Company.

(c) Following the Closing Date and for a period of five (5) years thereafter,
Buyer shall retain all Operating Records (whether in electronic form or
otherwise) of the Company on or prior to the Closing Date. Buyer also agrees
that, following the Closing Date and for a period of five (5) years thereafter,
Seller and its Affiliates shall have the right, upon reasonable request to
Buyer, to have access to, or receive from Buyer copies of, any Operating Records
or other information in Buyer’s possession relating to the Business on or prior
to the Closing Date. Seller or its Affiliates, as applicable, shall reimburse
Buyer for its reasonable costs and expenses incurred in connection with the
foregoing sentence. If Buyer shall desire to dispose of any Operating Records or
other information contemplated above, Buyer shall, prior to such disposition,
give Seller and its Affiliates a reasonable opportunity to segregate and remove
such records and information as it may select.

Section 5.3 Consents and Approvals.

(a) Each Party shall provide reasonable cooperation to the other Party in
obtaining consents, approvals or actions of, making all filings with and giving
all notices to Governmental Authorities or other Persons required of the other
Party in connection with obtaining any required consents to lawfully complete
the transactions contemplated by this Agreement, including the following:

(i) As promptly as practicable and, in any event, within thirty (30) days of the
Effective Date, Buyer and Seller shall each file, with the appropriate
Governmental Authority, such filings as are required by the HSR Act and shall
take all actions reasonably necessary to cause early termination of the
applicable waiting period under the HSR Act.

(ii) As promptly as practicable, Buyer and Seller shall jointly file, with Buyer
having primary responsibility therefor, with the applicable Governmental
Authority, all documents reasonably required to obtain the approvals or make the
notice filings described in Schedule 3.3(b) and Schedule 4.3(b) (other than the
approvals described in Section 5.3(a)(iii) and (iv)) and Buyer and Seller shall
use their

 

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commercially reasonable efforts to cause all such approvals to be issued and
notice filings to be made as soon as practicable after the Effective Date or as
and when required by such Governmental Authority. The Parties shall consult on
and coordinate all filings submitted by Buyer and Seller to such Governmental
Authorities.

(iii) As promptly as practicable and, in any event, within thirty (30) days of
the Effective Date, Buyer and Seller shall jointly file, with Buyer having
primary responsibility therefor, with the PUC all documents reasonably required
to obtain the approval of the transaction contemplated herein pursuant to
Section 39.158(a) of the Texas Public Utility Regulatory Act, and Buyer and
Seller shall use their commercially reasonable efforts to cause the approval of
the PUC to be issued as soon as practicable after the Effective Date. The
Parties shall consult on and coordinate all principal filings submitted by Buyer
and Seller to the PUC in connection with the approval of the PUC described
above.

(iv) Approval of the Federal Communications Commission for the Conversion and
change in control of the Company with respect to the radio licenses and
point-to-point private microwave licenses held by the Company.

(v) Notices required under (i) the Securities Exchange Act of 1934, (ii) the
1933 Act, or (iii) the rules promulgated by the New York Stock Exchange or any
other applicable securities exchange or quotation system on which the Parties or
their Affiliates may be listed.

(b) The Parties shall furnish to each other’s counsel such necessary information
and assistance as the other Party may request in connection with its preparation
of any such filing or submission that is necessary to obtain the foregoing
consents, approvals or actions. Buyer shall provide copies of all documents
submitted pursuant to this Section 5.3 to Seller and its advisors prior to
filing and, if requested, accept all reasonable additions, deletions or changes
suggested in connection therewith. The Parties shall consult with each other as
to the appropriate time of making such filings and submissions and shall make
such filings and submissions at the agreed upon time. The Parties shall keep
each other apprised of the status of any communications with and any inquiries
or requests for additional or supplemental information from applicable
Governmental Authorities, shall provide any such additional or supplemental
information that may be reasonably requested in connection with any such filings
or submissions. Buyer and Seller shall bear the costs and expenses of their
respective filings; provided that Buyer shall pay the filing fee in connection
with any such filings.

(c) Buyer shall use commercially reasonable efforts to contest and resist any
action, including administrative or judicial action, and to have vacated,
lifted, reversed or overturned, any order (whether temporary, preliminary or
permanent) of any court or other Governmental Authority that is in effect and
that restricts, prevents or prohibits the consummation of the transactions
contemplated by this Agreement, including the pursuit of all available avenues
of administrative and judicial appeal.

Section 5.4 Further Assurances. Subject to the terms and conditions of this
Agreement, each of the Parties will use its commercially reasonable efforts to
take, or cause to be

 

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taken, as soon as possible, all action, and to do, or cause to be done all
things necessary, proper or advisable under applicable laws and regulations to
consummate all of the transactions contemplated by this Agreement, including,
without limitation, the sale of the Membership Interests of the Company and the
assignment and assumption of the Assigned Contracts, including using its
commercially reasonable efforts to ensure satisfaction of the conditions
precedent to each Party’s obligations hereunder. Prior to submission by any
Party of any application with a Governmental Authority for a regulatory
approval, such Party shall submit such application to the other Party for review
and comment and shall incorporate into such application any revisions reasonably
requested by the other Party. None of the Parties will, without prior written
consent of the other Party, take or fail to take, or permit their respective
Affiliates to take or fail to take, any action, that would reasonably be
expected to prevent or materially impede, interfere with or delay the
consummation, as soon as possible, of the transactions contemplated by this
Agreement. Notwithstanding anything to the contrary in this Section 5.4 or this
Agreement, Seller shall not be required to take, or to cause to be taken, any
action altering or restricting in any way Seller’s business or commercial
practices (including, for the avoidance of doubt, divesting or holding separate
any of its assets or portion of its business) or the business or commercial
practices of any of its Affiliates.

Section 5.5 Public Statements. The Parties will not issue or make any press
releases or similar public announcements concerning this Agreement or the
transactions contemplated hereby without the consent of the other Party hereto,
which consent shall not be unreasonably withheld. If either Party is unable to
obtain the approval of its press release or similar public statement from the
other Party and such press release or similar public statement is, in the
opinion of legal counsel to such Party, required by applicable law in order to
discharge such Party’s disclosure obligations, then such Party may make or issue
the legally required press release or similar public statement and promptly
furnish the other Party with a copy thereof. Each Party will also obtain the
other Party’s prior approval, which approval shall not be unreasonably withheld,
of any press release to be issued immediately following the execution of this
Agreement or the Closing announcing the execution of this Agreement or the
consummation of the transactions contemplated hereby.

Section 5.6 Tax Matters.

(a) All excise, sales, use, transaction, conveyance, stock transfer, value
added, transfer (including real property transfer or gains), stamp, documentary,
filing, recordation and other similar Taxes, levies or assessments (“Transfer
Taxes”), together with any interest, additions or penalties with respect thereto
and any interest in respect of such additions or penalties, resulting directly
from the sale and transfer by Seller and/or by its Affiliates to Buyer of the
Membership Interests as contemplated by this Agreement, shall be borne by Buyer.
Buyer and Seller shall each prepare and file in a timely manner any and all Tax
Returns or other documentation relating to such Transfer Taxes which such
Parties are required to file pursuant to applicable law; provided, however,
that, to the extent required by applicable law, Seller, the Company and their
respective Affiliates will join in the execution of any such Tax Returns for
such Transfer Taxes or other documentation relating to any such Transfer Taxes.
The party filing any Tax Return described above shall provide to the other
party, and the Company copies of each Tax Return described in the proviso in the
preceding sentence for such Transfer Taxes at least thirty (30) days prior to
the date such Tax Return is required to be filed. Neither Seller nor

 

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the Company (and their Affiliates) shall file any refund request, protest, or
petition for reassessment, or take any similar action with respect to property
Taxes imposed on any of the property of the Company without the consent of
Buyer.

(b) Seller, at its cost and in accordance with past practices, shall prepare and
file, or cause to be prepared and filed, any Tax Returns of the Company for any
taxable period ending on or before the Closing Date. Buyer shall prepare and
file, or cause to be prepared and filed, any Tax Return of the Company for any
taxable period ending after the Closing Date. Each Party shall provide the other
Party with such assistance as may reasonably be requested by the other Party in
connection with the preparation of any Tax Return, any audit or other
examination by any taxing authority, or any judicial or administrative
proceedings relating to liability for Taxes, and each Party shall retain and
provide the other Party with any records or information that may be relevant to
any such return, audit, examination or proceedings and each shall provide the
other Party with any final determination of any such audit or examination,
proceeding or determination that affects any amount required to be shown on any
return of the other Party for any period. Any information obtained pursuant to
this Section 5.6(b) or pursuant to any other Section hereof providing for the
sharing of information or review of any Tax Return or other instrument relating
to Taxes shall be kept confidential by the Parties as provided in Section 5.7
hereof.

(c) In the event Buyer receives notice of any examination, claim, adjustment or
other proceeding relating to the liability for Taxes of or with respect to the
Company for any period prior to the Closing Date, Buyer shall notify Seller in
writing as soon as possible but in no event later than thirty (30) days of
receiving notice thereof. As to any such Taxes for which Seller is or may be
liable, Seller shall at Seller’s expense control or settle the contest of such
examination, claim, adjustment or other proceeding. In the event Seller receives
notice of any examination, claim, adjustment or other proceeding relating to the
liability for Taxes of or with respect to the Company that may have any effect
for any period after the Closing Date, Seller shall notify Buyer in writing as
soon as possible but in no event later than thirty (30) days of receiving notice
thereof. As to any such Taxes for which Buyer is or may be liable, Buyer shall
at Buyer’s expense control or settle the contest of such examination, claim,
adjustment or other proceeding. The Parties shall cooperate with each other and
with their respective Affiliates in the negotiations and settlement of any
proceeding described in this Section 5.6.

(d) Prior to the Closing Date, Seller shall cause the Company to be converted,
merged or liquidated into a Delaware (or such other jurisdiction in the United
States of America as Buyer may reasonably request) limited liability company
that is treated as a partnership for U.S. federal income tax purposes pursuant
to Treas. Reg. section 301.7701-3 (collectively, the “Conversion”).

(e) All ad valorem Taxes, both real and personal, or similar taxes, levied upon
the Company or the Business, shall be prorated between Buyer and Seller for that
portion of the applicable Tax period prior to and after the Closing Date.

(f) Seller shall indemnify, defend and hold harmless the Buyer Indemnitees from
and against any and all claims, demands or suits by any Person, and all losses,
liabilities, damages, obligations, payments, costs and expenses (including
reasonable legal fees and

 

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expenses and including costs and expenses incurred in connection with
investigations and settlement proceedings) relating to the following Taxes:
(i) all Taxes imposed on Seller or any Affiliate thereof (other than the
Company), (ii) Taxes of or relating to the Company for, or allocable to, Tax
periods (or portions thereof) beginning before and ending on or before the
Closing Date, and (iii) Income Taxes imposed on or payable by the Company solely
by reason of being severally liable for the Income Tax of any other person
pursuant to Treasury Regulation Section 1.1502-6 or any analogous state or local
Tax Law.

Section 5.7 Confidentiality.

(a) Each Party agrees that it shall not use any Confidential Information of any
other Party, the Company or any of their respective Affiliates for any purpose
other than in connection with the consummation of the transactions contemplated
by this Agreement. Each Party further agrees that it shall not divulge any such
Confidential Information to any Person (i) except to its employees, agents,
representatives, lenders, financial and other advisors and representatives to
the extent required in connection with the transactions contemplated by this
Agreement, (ii) except as required to comply with applicable laws, ordinances,
decrees or judicial or administrative orders (and then only that portion of the
Confidential Information that is legally required to be disclosed), and
(iii) except as otherwise agreed to by the Parties in writing. Each Party shall
inform its employees, agents, lenders, financial and other advisors and
representatives of the confidential nature of such information and the
obligation to keep such information confidential, and shall take such other
action as shall be reasonably required to cause such information to be kept
confidential.

(b) For purposes of this Agreement, “Confidential Information” shall mean any
confidential or proprietary information including any information relating to
any Party or its Affiliates’ properties or operations which has been disclosed
by such Party to another Party in connection with the transactions contemplated
hereby (it being agreed that effective upon the occurrence of the Closing any
Confidential Information with respect to the Company or the Generating Facility
disclosed by Seller to Buyer shall also be treated as Confidential Information
of Buyer disclosed to Seller); provided, however, that Confidential Information
shall not include any information if:

(i) the receiving Party shall have had knowledge of such information prior to
the date on which such Party received it from the other Party, and such
information was free from any limitation on disclosure;

(ii) such information shall have entered the public domain through no fault of
the receiving Party; or

(iii) such information shall have been independently developed by the receiving
Party.

(c) In the event that this Agreement is terminated for any reason, the covenants
under this Section 5.7 shall survive the termination of this Agreement. At the
time of such termination, if requested by any Party, the other Party shall use
its reasonable efforts to return to the other Party, or destroy, all documents
in its possession that contain Confidential Information of the other Party.

 

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Section 5.8 Compliance with Governmental Agreements. Following the Closing Date,
Buyer agrees that it will abide by, and comply with, all existing permit
conditions, provisions in existing rulings and regulations, and any other
existing agreements or arrangements among the Company and the State of Texas (or
any political subdivision thereof), including provisions or agreements relating
to environmental compliance and mitigation, in each case to the extent any such
condition, provision, agreement or arrangement relates to the operation of the
Business of the Company, unless and to the extent Buyer is exempt by law,
regulation or order from compliance with any such condition, provision,
agreement or arrangement.

Section 5.9 Counterparty Consents; Replacement Support Obligation.

(a) From and after the date hereof, Buyer and Seller shall use commercially
reasonable efforts to obtain the written consent from each party to each
Assigned Contract (other than Seller and its Affiliates) to Assignor’s
assignment and Assignee’s assumption or novation of such Assigned Contract and
to obtain the Lyondell Consents. With respect to any Assigned Contract that
cannot be assigned or novated as contemplated hereby:

(i) Seller and Buyer shall, to the extent permissible under applicable laws and
under the terms of such Assigned Contract, cause the respective Assignor and
Assignee to enter into arrangements intended to put such Assignor and Assignee
in substantially the same economic position as if such Assigned Contract were
assigned and assumed or novated from the Closing Date until such Assigned
Contract expires by its terms; and

(ii) if such arrangements are not entered into, Buyer shall indemnify Seller
against all losses and liabilities arising out of the failure of any such
Assigned Contract to be assigned and assumed or novated or the failure of such
arrangements to be entered into.

(b) On the Closing Date, Buyer shall provide replacement letters of credit or
other credit support arrangements in form and substance satisfactory to the
counterparties to the Assigned Contracts and the Contracts described on Schedule
3.5(a) as may be required to effectuate the release and return to Seller or its
Retained Affiliates of any and all letters of credit or other credit support
arrangements associated therewith including, without limitation, the letters of
credit and guarantees described on Schedule 2.5(a)(iii).

Section 5.10 Employee Matters.

(a) Buyer agrees to provide, or to cause an Affiliate to provide, written offers
of employment to all then current Employees who are not on leave (excluding any
vacation or short-term disability leave) on the date of such offer at least
fifteen (15) days prior to the Employee Transition Date (defined below) and to
hire the Employees who wish to accept such offers of employment (the “Hired
Employees”). The offers shall provide Employees not less than five (5) days to
accept or reject such offers in writing and provided that the fifth (5th) day of
such five (5) day period shall occur prior to the Closing Date. Except as
provided in Section

 

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5.10(c), the effective date of such employment (the “Employee Transition Date”)
shall be 12:01 a.m. of the day immediately following the day of Closing.
Notwithstanding anything contained herein to the contrary, Buyer shall have no
obligations to provide an offer of employment to, or hire, any Employee who does
not satisfy Buyer’s generally applicable employment conditions.

(b) Buyer shall provide to Seller copies of any written offers of employment
made to the Employees within five (5) days of providing such written offers to
the Employees. At least seven (7) days prior to the Employee Transition Date,
Buyer shall notify Seller in writing of the Employees who have accepted offers
of employment with Buyer.

(c) In the case of an Employee who is on leave as of the Closing Date, such
Employee’s employment with Buyer shall be subject to the Employee becoming able
to return to active service, and shall be effective upon the Employee’s
acceptance of such offer and actual return to active service, within six
(6) months of the Closing Date, or later if so required under applicable law.
References in this Section 5.10 to “Employee Transition Date” shall mean, with
respect to Employees on leave as of the Closing Date, the effective date of such
Employees’ employment with Buyer pursuant to this Section 5.10(c).

(d) Buyer agrees to employ the Hired Employees on terms that are (i) generally
comparable in the aggregate to such Employees’ current employment terms with
respect to salary, bonuses and base hours (as set forth in the letter provided
to Buyer pursuant to Section 3.13(b)) and (ii) generally comparable in the
aggregate with respect to benefits (including, without limitation, medical,
retirement, severance benefits and vacation) provided to similarly situated
employees of Buyer and its Affiliates (with credit for any existing payments
toward deductibles). Buyer agrees to provide such benefits to Hired Employees
for a period of one (1) year following the Employee Transition Date, provided
the particular Hired Employee remains employed by Buyer or one of its Affiliates
during such period.

(e) Effective immediately preceding the Employee Transition Date and except as
otherwise provided herein, the Hired Employees’ employment with Seller or
Seller’s Affiliate shall terminate and the Hired Employees shall no longer
participate in any Benefit Plan.

(f) Effective immediately upon the Employee Transition Date and except as
otherwise provided herein, the Hired Employees’ employment with Buyer shall
commence and the Hired Employees shall be immediately eligible to participate in
Buyer’s employee benefit plans, programs, practices and arrangements subject to
generally applicable eligibility provisions contained therein.

(g) In the event that any Hired Employee is terminated (other than for cause)
within the twelve-month period beginning on the Closing Date, Buyer shall
provide such terminated Hired Employee with severance payments and benefits at
least equal to the severance payments and benefits that would have been provided
as of the Closing Date under the Dynegy Inc. Severance Pay Plan or the Dynegy
Inc. Executive Severance Pay Plan, as applicable, but calculated pursuant to the
terms of such plans as in effect on the Effective Date, based on such Hired
Employee’s title immediately prior to the Employee Transition Date.

 

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(h) Buyer shall not assume any of the Benefit Plans and shall have no
obligations and shall have no liabilities with respect to the Benefit Plans.
Claims for workers’ compensation or long-term disability benefits arising out of
occurrences prior to the Employee Transition Date shall be the responsibility of
Seller and its applicable Affiliates. Claims for workers’ compensation or
long-term disability benefits for Hired Employees arising out of occurrences on
or subsequent to the Employee Transition Date shall be the responsibility of
Buyer. Nothing herein shall be deemed or construed to (i) give rise to any
rights, claims, benefits, or causes of action to any Employee or (ii) prevent,
restrict, or limit Buyer or Seller or their Affiliates following the Employee
Transition Date from terminating the employment of any Employee or modifying or
terminating its pension or other benefit plans, programs or policies from time
to time as they may deem appropriate.

(i) Hired Employees shall be credited with the same number of years of service,
including partial years of service, as they are credited by Seller, or an
Affiliate of Seller, under the applicable Benefit Plan, for severance,
eligibility, vesting purposes and benefit accrual except (i) for benefit accrual
under a defined benefit pension plan, (ii) to the extent such credit would
result in a duplication of benefits, or (iii) to the extent such crediting of
service would exceed the years of credited service recognized under the
applicable Buyer or Affiliate benefit plan for other similarly situated plan
participants. Hired Employees shall (if permitted by Buyer’s plan) be permitted
to roll-over any Code Section 401(k) account balances and associated loans (if
permitted by Buyer’s plan) they may have in the Benefit Plans as of the Employee
Transition Date into plans sponsored by Buyer. The Parties shall cooperate in
good faith to permit the transition of Hired Employees from flexible spending
accounts maintained by Seller and its Affiliates to similar accounts maintained
by Buyer and Buyer’s Affiliates in a manner that is fair to the Hired Employees.

(j) Seller and its applicable Affiliates shall be responsible for compliance
with and liability under Section 4980B of the Code and Sections 601 through 608
of Title I of the Employee Retirement Income Security Act of 1974, as amended
(“COBRA”) with respect to any COBRA-qualifying events that occur on or prior to
the Closing Date to the extent mandated by COBRA with respect to the Employees,
Seller or Seller’s Affiliates’ former employees, and the spouses and dependents
of both of the foregoing. Buyer shall be responsible for compliance with and
liability under COBRA with respect to any COBRA-qualifying events that occur
after the Closing Date with respect to Hired Employees, and with respect to the
spouses and dependents of such Hired Employees.

Section 5.11 Insurance. Seller shall maintain or cause to be maintained in full
force and effect the insurance coverage described in Section 3.12 until the
Closing. All such insurance coverage shall be terminated as of the Closing.
Buyer acknowledges and agrees that it shall not have any right or interest in
and to any insurance awards or proceeds payable under Seller’s insurance
coverage relating to any damage, destruction or casualty loss of any of the
Company Assets on or prior to the Closing Date and shall not claim any interest
therein. Buyer shall be solely responsible for providing insurance with respect
to the Company and its assets and properties for any event or occurrence of any
kind whatsoever after the Closing Date.

 

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Section 5.12 Casualty.

(a) If, prior to Closing, a casualty event causes damage to any of the Company
Assets resulting in a material impairment to the value of the Membership
Interests, then Seller shall promptly employ a qualified firm reasonably
acceptable to Buyer to estimate (1) the reasonable cost of restoring the damaged
or destroyed assets to a condition reasonably comparable to their prior
condition, and (2) the profit, if any, that with reasonable certainty would have
been realized by the Company during the period after Closing if the casualty
event had not caused damage to or destroyed the assets, as adjusted to account
for any tax or other benefit associated with such damage or estimated loss,
respectively (together, the restoration costs and lost profits are referred to
herein as the “Restoration Cost”).

(i) If the Restoration Cost is $500,000.00 or less, then (i) neither Buyer nor
Seller shall have the right or option to terminate this Agreement, and
(ii) there shall be no reduction in the amount of the Purchase Price.

(ii) If the Restoration Cost is greater than $500,000.00 but less than ten
percent (10%) of the Purchase Price, then, at Seller’s election, either (i)(A)
the Purchase Price shall be reduced by the Restoration Cost, and (B) such
casualty loss shall not affect the Closing, or (ii) Seller may terminate this
Agreement by written notice thereof to Buyer; provided, however, that if Seller
does not provide written notice of its election of the foregoing to Buyer within
45 days after the date of delivery of the Restoration Cost estimate to the
Parties, then Buyer may elect to terminate this Agreement within ten
(10) Business Days following the end of such 45-day period.

(iii) If the Restoration Cost exceeds ten percent (10%) of the Purchase Price,
then Buyer or Seller may terminate this Agreement by written notice to the other
party.

(b) If this Agreement is not terminated pursuant to the provisions of
Section 5.12(a), Buyer agrees that:

(i) Buyer shall, at its sole cost and risk, undertake the restoration of such
Company Assets to a condition reasonably comparable to their prior condition,
including assumption of risk of loss or damage to any undamaged Company Assets
resulting from such restoration, and any activities by or on behalf of Buyer
prior to Closing associated with such restoration will be subject to Seller’s
reasonable insurance and other requirements.

(ii) Buyer shall fully cooperate with Seller and its Affiliates with respect to
any claims Seller or its Affiliates may make under their insurance policies
(“Seller’s Policies”), and provide any assistance requested by Seller or its
Affiliates to assist Seller or its Affiliates in making and/or pursing any such
claims.

(iii) To the extent that Buyer’s actions or inactions reduce the amount of any
recovery by Seller under Seller’s Policies, Buyer shall reimburse the amount of
such reduction to Seller with 30 days of Buyer’s receipt of Seller’s invoice for
same.

 

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Section 5.13 Condemnation. If, prior to Closing, any Company Assets are taken by
condemnation, causing a material impairment to the value of the Membership
Interests, then Seller shall promptly determine (1) the condemnation value of
such condemned assets, and (2) the estimated profit, if any, that with
reasonable certainty would have been realized by the Company during the period
after Closing if the assets had not been taken by condemnation, as adjusted to
account for any tax benefit associated with such condemnation or estimated loss,
respectively (together, the condemnation value and estimated lost profits are
referred to herein as the “Condemnation Value”).

(a) If the Condemnation Value is $500,000.00 or less, then (i) neither Buyer nor
Seller shall have the right or option to terminate this Agreement, and
(ii) there shall be no reduction in the amount of the Purchase Price.

(b) If the Condemnation Value is greater than $500,000.00 but less than ten
percent (10%) of the Purchase Price, then, at Seller’s election, either (i)(A)
the Purchase Price shall be reduced by the Condemnation Value, and (B) such
condemnation shall not affect the Closing, or (ii) Seller may terminate this
Agreement by written notice thereof to Buyer; provided, however, that if Seller
does not provide written notice of its election of the foregoing to Buyer within
45 days after the date of the condemnation, then Buyer may elect to terminate
this Agreement within ten (10) Business Days following the end of such 45-day
period.

(c) If the Condemnation Value exceeds ten percent (10%) of the Purchase Price,
then Buyer or Seller may terminate this Agreement by written notice to the other
party.

Section 5.14 Termination of Affiliate Contracts. Prior to Closing, Seller shall
terminate any and all Contracts between Seller or its Affiliates, on the one
hand, and the Company, on the other hand.

Section 5.15 Supplement to Schedules.

(a) If, prior to the Closing Date, Buyer obtains actual knowledge of a breach of
any of Seller’s representations, warranties or covenants contained in this
Agreement, Buyer shall promptly notify Seller in writing of such information so
that Seller may have an opportunity to cure such breach prior to the Closing
Date and, if so cured, then such breach shall be considered not to have occurred
for all purposes of this Agreement.

(b) Seller shall have the right, from time to time prior to the Closing, by
written notice to Buyer, to supplement or amend Seller’s Disclosure Schedules
with respect to any matter hereafter arising or discovered which if existing or
Known at the Effective Date would have been required to be set forth or
described in such Seller’s Disclosure Schedules. Any such supplemental or
amended disclosure shall not be deemed to have been disclosed for purposes of
determining whether or not the conditions to Closing set forth in Section 6.2
have been satisfied but, if the Closing occurs, such update shall be deemed to
have cured any breach of representation, warranty, covenant or agreement
relating to the matter set forth in such update for purposes of indemnification
pursuant to Article 7.

 

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Section 5.16 Pre- and Post-Closing Cooperation.

(a) For a reasonable period not to exceed ten (10) Business Days preceding the
Closing Date, Seller shall, and shall cause its and its Affiliates’ personnel,
to reasonably cooperate with Buyer and Buyer’s or Buyer’s Affiliates’ personnel
in the interest of planning and facilitating an orderly transition of the
management and administration of the Company, the Generating Facility and the
Business, including permitting Buyer and Buyer’s or Buyer’s Affiliates’
personnel reasonable access to the Generating Facility to set up hardware and
software systems to replace the Retained Software License Agreements and
Hardware located at the Generating Facility; provided that in no event shall
Buyer or Buyer’s or Buyer’s Affiliates’ personnel have the right to disable the
Retained Software License Agreements and Hardware located at the Generating
Facility until after Closing. For a reasonable period not to exceed ten
(10) Business Days following the Closing Date, personnel of Seller or its
Affiliates shall have the right to access the Generating Facility for the
limited purpose of removing from the Generating Facility the Retained Software
License Agreements and Hardware located at the Generating Facility.

(b) Seller shall use commercially reasonable efforts to cooperate with and
provide such assistance and information to the Company’s independent auditors as
may be reasonably requested by the Company in connection with the preparation of
audited financial statements of the Company on a stand-alone basis as of
December 31, 2007 and the issuance of the related auditor’s report thereon,
excluding, however, information related to Affiliates of Seller not related to
the Company.

Section 5.17 Buyer Letter of Credit. To secure Buyer’s obligations under this
Agreement, on or before June 15, 2007, Buyer shall deliver the Buyer Letter of
Credit to Seller. Within two (2) Business Days after Seller’s receipt of the
Buyer Letter of Credit, Seller shall return the Buyer Parent Guaranty to Buyer.
Seller shall return the Buyer Letter of Credit to Buyer at the Closing.

Article 6

Conditions

Section 6.1 Conditions Precedent of Each Party. The respective obligations of
each Party to effect the purchase and sale of the Membership Interests of the
Company and assignment of the Assigned Contracts shall be subject to such
Party’s satisfaction or waiver of the following conditions on or prior to the
Closing Date:

(a) the Seller Required Regulatory Approvals and the Buyer Required Regulatory
Approvals shall have been obtained and all conditions to effectiveness
prescribed therein or otherwise by law, regulation or order shall have been
satisfied.

(b) the waiting period under the HSR Act applicable to the consummation of the
sale and purchase of the Membership Interests contemplated hereby shall have
expired or been terminated.

(c) there shall be no: (i) preliminary or permanent injunction or other order or
decree by any federal or state court of competent jurisdiction, or (ii) statute
or regulation enacted by any Governmental Authority prohibiting the consummation
of the purchase and sale of the Membership Interests (clauses (i) and (ii),
collectively, the “Restraints”).

 

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(d) the Parties shall have received the Lyondell Consents.

Section 6.2 Conditions Precedent of Buyer. The obligation of Buyer to effect the
purchase and sale of the Membership Interests of the Company and assume the
Assigned Contracts as contemplated by this Agreement shall be subject to Seller
and the Company, as applicable, satisfying the following additional conditions
on or prior to the Closing Date or waiver by Buyer:

(a) Seller and the Company, as applicable, shall have performed in all material
respects the covenants and agreements contained in this Agreement that are
required to be performed by them on or prior to the Closing Date;

(b) the representations and warranties of Seller set forth in this Agreement
that are qualified as to materiality shall be true and correct as of the date of
this Agreement and as of the Closing Date, as if made at and as of such time
(except to the extent expressly made as of an earlier date, in which case as of
such date) and the representations and warranties of Seller set forth in this
Agreement that are not qualified as to materiality shall be true and correct in
all material respects as of the date of this Agreement and as of the Closing
Date, as if made at and as of such time (except to the extent expressly made as
of an earlier date, in which case as of such date);

(c) Buyer shall have received a certificate from an authorized officer or
representative of Seller, dated the Closing Date, to the effect that, to the
best of such officer’s knowledge, the conditions set forth in Section 6.2(a) and
(b) have been satisfied;

(d) Seller shall have furnished Buyer with evidence reasonably satisfactory to
Buyer that the Conversion has occurred in accordance with Section 5.6(d) of this
Agreement and in compliance with all applicable laws; and

(e) Seller, the Company and their respective Affiliates, as applicable, shall
have delivered to Buyer (i) all such instruments required to be delivered under
Section 2.5(b), or (ii) otherwise required to consummate the transactions
contemplated by this Agreement.

Section 6.3 Conditions Precedent of Seller. The obligation of Seller to effect
the purchase and the sale of the Membership Interests and assignment of the
Assigned Contracts contemplated by this Agreement shall be subject to Buyer’s
satisfaction of the following additional conditions on or prior to the Closing
Date or waiver by Seller:

(a) Buyer shall have performed in all material respects the covenants and
agreements contained in this Agreement that are required to be performed on or
prior to the Closing Date;

(b) the representations and warranties of Buyer set forth in this Agreement that
are qualified as to materiality shall be true and correct as of the date of this
Agreement and as of the Closing Date, as if made at and as of such time (except
to the extent expressly made as

 

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of an earlier date, in which case as of such date) and the representations and
warranties of Buyer set forth in this Agreement that are not qualified as to
materiality shall be true and correct in all material respects as of the date of
this Agreement and as of the Closing Date, as if made at and as of such time
(except to the extent expressly made as of an earlier date, in which case as of
such date);

(c) Seller shall have received a certificate from an authorized officer of
Buyer, dated the Closing Date, to the effect that, to the best of such officer’s
knowledge, the conditions set forth in Section 6.3(a) and (b) have been
satisfied; and

(d) Buyer shall have delivered to Seller all such instruments required to be
delivered pursuant to Section 2.5(a); and

(e) Buyer shall have delivered to Seller, or to the Company, all such other
instruments that, in the reasonable opinion of Seller and its counsel, are
(i) necessary for Seller and its Affiliates to be released with respect to any
and all contractual obligations to third parties with respect to the operation
of the Company’s Business, or (ii) otherwise required to consummate the
transactions contemplated by this Agreement.

Section 6.4 Break-up Fee.

(a) If this Agreement is terminated by Seller pursuant to Section 8.1(f), then
in lieu of all other claims and remedies that may otherwise be available to
Seller with respect thereto, Buyer shall pay to Seller, by wire transfer of
immediately available funds within three (3) Business Days following the date of
termination, a break-up fee in an amount equal to ten percent (10%) of the
Purchase Price.

(b) The provision for payment of a break-up fee in Section 6.4(a) is an integral
part of this Agreement. Buyer acknowledges that Seller would not enter into this
Agreement with Buyer in the absence of such provision and that Buyer has
specifically agreed to such provision as a material inducement for Seller to
enter into this Agreement.

Article 7

Indemnification

Section 7.1 Indemnity Obligations. Subject to the limitations and conditions set
forth in this Article 7:

(a) Seller shall indemnify, defend and hold harmless Buyer and its Affiliates
and their respective directors, officers, employees and agents (collectively
with Buyer and its Affiliates, the “Buyer Indemnitees”) from and against any and
all claims, demands or suits by any Person, and all losses, liabilities,
damages, obligations, payments, costs and expenses (including reasonable legal
fees and expenses and including costs and expenses incurred in connection with
investigations and settlement proceedings) (each, an “Indemnifiable Loss”), as
incurred, asserted against or suffered by any Buyer Indemnitee relating to,
resulting from or arising out of (i) any breach by Seller of any representation,
warranty, covenant or agreement of Seller contained in this Agreement or
(ii) any Assigned Contract with respect to any period prior to Closing.

 

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(b) Buyer will indemnify, defend and hold harmless Seller and its Affiliates and
their respective directors, officers, trustees, employees and agents (the
“Seller Indemnitees”) from and against any and all Indemnifiable Losses, as
incurred, asserted against or suffered by any Seller Indemnitee relating to,
resulting from or arising out of (i) any breach by Buyer of any representation,
warranty, covenant or agreement of Buyer contained in this Agreement, (ii) any
Assigned Contract with respect to any period from and after Closing; or
(iii) any Transfer Tax obligations imposed on Seller, the Company or their
respective Affiliates for which Buyer is responsible under the terms of this
Agreement.

(c) Any Person entitled to receive indemnification under this Agreement having a
claim under these indemnification provisions shall make a good faith effort to
recover any Indemnifiable Loss from insurers of such Indemnitee under applicable
insurance policies so as to reduce the amount of any Indemnifiable Loss
hereunder. The amount of any Indemnifiable Loss shall be reduced to the extent
that the relevant Buyer Indemnitee or Seller Indemnitee (each, an “Indemnitee”)
receives any insurance proceeds with respect to an Indemnifiable Loss. If the
amount of any Indemnifiable Loss, at any time subsequent to the making of an
indemnity payment in respect thereof, is reduced by recovery, settlement or
otherwise under or pursuant to any insurance coverage, or pursuant to any claim,
recovery, settlement or payment by or against any other Person, the amount of
such reduction, less any costs, expenses or premiums incurred in connection
therewith, will promptly be repaid by the Indemnitee to the Party required to
provide indemnification hereunder (the “Indemnifying Party”) with respect to
such Indemnifiable Loss.

(d) To the fullest extent permitted by law, no Party nor any Buyer Indemnitee or
any Seller Indemnitee shall be liable to any other Party or any other Buyer
Indemnitee or Seller Indemnitee for any claims, demands or suits for
consequential, incidental, special, exemplary, punitive, indirect or multiple
damages connected with or resulting from any breach of this Agreement (other
than breach of this Article 7), or any actions undertaken in connection with or
related hereto or thereto, including any such damages based upon breach of
contract, tort (including negligence and misrepresentation), breach of warranty,
strict liability, statute, operation of law or any other theory of recovery.

(e) The rights and remedies of Seller and its Affiliates and Buyer under
Section 5.6(f) and this Article 7 are, solely as between Seller and its
Affiliates and Buyer, exclusive and in lieu of any and all other rights and
remedies that Seller and its Affiliates and Buyer may have under this Agreement
or otherwise for monetary relief with respect to (i) any breach of, or failure
to perform, any covenant or agreement set forth in this Agreement by Seller, the
Company or their respective Affiliates or Buyer, as applicable, and (ii) any
breach of any representation or warranty by Seller or the Company or Buyer. Each
Party agrees that the previous sentence shall not limit or otherwise affect any
nonmonetary right or remedy that a Party may have under this Agreement or
otherwise limit or affect any Party’s right to seek equitable relief, including
the remedy of specific performance. EXCEPT FOR THE REPRESENTATIONS AND
WARRANTIES EXPRESSLY SET FORTH IN ARTICLE 3, BUYER ACKNOWLEDGES AND AGREES THAT
NONE OF SELLER, THE COMPANY, AND THEIR RESPECTIVE AFFILIATES, ARE MAKING ANY
REPRESENTATIONS OR WARRANTIES, WHETHER WRITTEN, ORAL, STATUTORY, EXPRESS, OR
IMPLIED, CONCERNING THE OPERATION OF THE BUSINESS (INCLUDING ANY RELATING TO
LIABILITIES, OPERATIONS OF THE GENERATING FACILITIES, CONDITION, VALUE

 

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OR QUALITY OF THE BUSINESS OR THEIR PROSPECTS (FINANCIAL OR OTHERWISE), RISKS OR
OTHER INCIDENTS OF THE BUSINESS) OR WITH RESPECT TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. BUYER ACKNOWLEDGES AND AGREES THAT EACH OF
SELLER AND THE COMPANY SPECIFICALLY DISCLAIM ANY REPRESENTATION OR WARRANTY OF
MERCHANTABILITY, USAGE, SUITABILITY, OR FITNESS FOR A PARTICULAR PURPOSE WITH
RESPECT TO THE ASSETS OF THE COMPANY OR ANY PART THEREOF, AS TO THE WORKMANSHIP
THEREOF, THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR PATENT,
COMPLIANCE WITH ENVIRONMENTAL REQUIREMENTS, THE APPLICABILITY OF ANY
GOVERNMENTAL REQUIREMENTS, INCLUDING BUT NOT LIMITED TO ANY FORMER, CURRENT OR
FUTURE ENVIRONMENTAL LAWS, OR WHETHER THE COMPANY POSSESSES SUFFICIENT REAL OR
PERSONAL PROPERTY TO OPERATE THE BUSINESS, EXCEPT AS EXPRESSLY SET FORTH IN
ARTICLE 3. BUYER ACKNOWLEDGES AND AGREES THAT EACH OF SELLER AND THE COMPANY
FURTHER SPECIFICALLY DISCLAIM ANY REPRESENTATION OR WARRANTY REGARDING THE
ABSENCE OF HAZARDOUS SUBSTANCES OR LIABILITY OR POTENTIAL LIABILITY ARISING
UNDER FORMER, CURRENT OR FUTURE ENVIRONMENTAL LAWS, WITH RESPECT TO THE
OPERATION OF THE BUSINESS, ALL OF WHICH ARE HEREBY EXPRESSLY WAIVED BY BUYER,
UNLESS EXPRESSLY PROVIDED IN SECTION 3.9.

(f) Buyer and Seller agree that, notwithstanding Section 7.1(e), each Party
shall retain, subject to the other provisions of this Agreement, including
Sections 7.1(d) and 9.3, all remedies at law or in equity with respect to
(i) fraud or willful or intentional breaches of this Agreement and (ii) gross
negligence or willful or wanton acts or omissions to act of any Indemnitee (or
any contractor or subcontractor thereof) after the Closing Date.

Section 7.2 Cap Amount; Minimum Claim.

(a) Notwithstanding anything to the contrary in this Agreement or otherwise, and
subject to the limitations in this Section 7.2, no Buyer Indemnitee shall
recover for any Indemnifiable Loss (other than any breach of a representation or
warranty contained in Section 3.1, 3.2, 3.4, 3.10, 3.11, 3.13 or 5.6 or a matter
covered by Section 5.6(f)) unless and until the amount of Indemnifiable Loss
exceeds (i) an amount equal to $500,000.00 for any single event or occurrence or
any aggregated claims arising out of the same or similar facts, events or
circumstances (the “Per Claim Deductible”), and (ii) an amount equal to two
percent (2%) of the Purchase Price (the “Aggregate Deductible”), after which
Seller shall have the obligation to indemnify for the full amount of any such
Indemnifiable Loss that exceeds the Per Claim Deductible to the extent the
aggregate of all such Indemnifiable Losses exceed the Aggregate Deductible,
subject, however, to the Indemnification Cap.

(b) The maximum aggregate amount of Indemnifiable Losses that may be recovered
under this Agreement shall not exceed five percent (5%) of the Purchase Price
(the “Indemnification Cap”), except for Indemnifiable Losses caused by a breach
of a representation or warranty contained in Section 3.1, 3.2, 3.4, 3.10, 3.11,
3.13, 5.6 or a matter covered by Section 5.6(f) which Indemnifiable Losses,
together with any aggregate liability pursuant to 7.2(a), shall not exceed
one-hundred percent (100%) of the Purchase Price.

 

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Section 7.3 Third Party Claims Procedures.

(a) If any Indemnitee receives notice of the assertion of any claim or of the
commencement of any claim, action, or proceeding made or brought by any Person
who is not a Party or an Affiliate of a Party (a “Third Party Claim”) with
respect to which indemnification is to be sought from an Indemnifying Party, the
Indemnitee will give such Indemnifying Party reasonably prompt written notice
thereof, but in any event not later than ten (10) Business Days after the
Indemnitee’s receipt of notice of such Third Party Claim; provided, however,
that a failure to give timely notice will not affect the rights or obligations
of any Indemnitee except if, and only to the extent that, as a result of such
failure, the Indemnifying Party was actually prejudiced. Such notice shall
describe the nature of the Third Party Claim in reasonable detail and will
indicate the estimated amount, if practicable, of the Indemnifiable Loss that
has been or may be sustained by the Indemnitee.

(b) If a Third Party Claim is made against an Indemnitee, the Indemnifying Party
will be entitled to participate in the defense thereof and, if it so chooses, to
assume the defense thereof with counsel selected by the Indemnifying Party;
provided, however, that such counsel is not reasonably objected to by the
Indemnitee; and provided further that the Indemnifying Party first admits in
writing its liability to the Indemnitee with respect to all material elements of
such claim. Should the Indemnifying Party so elect to assume the defense of a
Third Party Claim, the Indemnifying Party will not be liable to the Indemnitee
for any legal expenses subsequently incurred by the Indemnitee in connection
with the defense thereof. If the Indemnifying Party elects to assume the defense
of a Third Party Claim, the Indemnitee will (i) cooperate in all reasonable
respects with the Indemnifying Party in connection with such defense, (ii) not
admit any liability with respect to, or settle, compromise or discharge, any
Third Party Claim without the Indemnifying Party’s prior written consent and
(iii) agree to any settlement, compromise or discharge of a Third Party Claim
that the Indemnifying Party may recommend and that by its terms obligates the
Indemnifying Party to pay the full amount of the liability in connection with
such Third Party Claim and releases the Indemnitee completely in connection with
such Third Party Claim. In the event the Indemnifying Party shall assume the
defense of any Third Party Claim, the Indemnitee shall be entitled to
participate in (but not control) such defense with its own counsel at its own
expense. If the Indemnifying Party does not assume the defense of any such Third
Party Claim, the Indemnitee may defend the same in such manner as it may deem
appropriate, including settling such claim or litigation after giving notice to
the Indemnifying Party of the terms of the proposed settlement and the
Indemnifying Party will promptly reimburse the Indemnitee upon written request.
Anything contained in this Agreement to the contrary notwithstanding, no
Indemnifying Party shall be entitled to assume the defense of any Third Party
Claim if such Third Party Claim seeks an order, injunction or other equitable
relief or relief for other than monetary damages against the Indemnitee that, if
successful, would materially and adversely affect the business of the
Indemnitee.

 

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Article 8

Termination

Section 8.1 Termination.

(a) This Agreement may be terminated at any time prior to the Closing by an
instrument in writing signed on behalf of each of the Parties.

(b) This Agreement may be terminated by Seller or Buyer if the Closing shall not
have occurred on or before November 1, 2007 (the “Termination Date”); provided,
however, that the right to terminate this Agreement pursuant to this
Section 8.1(b) shall not be available to any Party whose failure to fulfill any
obligation under this Agreement has been the cause of, or resulted in, the
failure of the Closing to occur on or before such date.

(c) This Agreement may be terminated by any Party if any Restraint having any of
the effects set forth in Section 6.1(c) shall be in effect and shall have become
final and nonappealable; provided, however, that the Party seeking to terminate
this Agreement pursuant to this Section 8.1(c) shall have used its commercially
reasonable efforts to remove or prevent the entry of such Restraint.

(d) This Agreement may be terminated by any Party if there has been a material
breach by the other Party of any representation, warranty, covenant or agreement
contained in this Agreement if the defaulting Party fails to cure such breach
within thirty (30) days of notice by the non-defaulting Party.

(e) This Agreement may be terminated as provided in Section 5.12 or 5.13.

(f) This Agreement may be terminated by Seller if Buyer fails to deliver to
Seller, on or before June 15, 2007, (i) the Buyer Letter of Credit and
(ii) evidence reasonably acceptable to Seller that Buyer has or will have cash
available to effect, at the Closing, the purchase of the Membership Interests
pursuant to this Agreement. Seller agrees that Buyer’s provision of a
certificate from a duly authorized officer or other authorized representative of
Buyer to the effect that the closing of the financing transaction contemplated
with Wells Fargo, as previously discussed with Seller (meaning the loan
documents and related agreements pertaining to said financing transaction are
executed by Buyer and Wells Fargo and any other lenders participating in the
transaction; and all of the conditions to the initial borrowings or advances are
satisfied or waived in accordance with the terms of the applicable financing
documents) shall be sufficient to satisfy Buyer’s obligations under clause
(ii) above.

Article 9

Miscellaneous Provisions

Section 9.1 Expenses. Except to the extent specifically provided herein or by
agreement between Seller and Buyer with respect to the costs and expenses of
Seller, all costs and expenses incurred in connection with this Agreement and
the transactions contemplated hereby shall be borne by the Party incurring such
costs and expenses, whether or not the transactions contemplated hereby are
consummated; provided, however, Buyer shall pay for all costs in connection with
the HSR Act filing.

 

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Section 9.2 Amendment and Modification; Extension; Waiver. This Agreement may be
amended, modified or supplemented only by an instrument in writing signed on
behalf of each of the Parties. The Parties may (a) extend the time for the
performance of any of the obligations or other acts of a Party, (b) waive any
inaccuracies in the representations and warranties of a Party contained in this
Agreement or (c) waive compliance by a Party with any of the agreements or
conditions contained in this Agreement. Any agreement on the part of the Parties
to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of all Parties. The failure of a Party to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of such rights.

Section 9.3 Survival. Each and every representation and warranty contained in
this Agreement shall survive the Closing Date for a period of twelve (12) months
after the Closing Date and shall thereafter terminate and be of no further force
or effect, except that (i) the representations and warranties contained in
Sections 3.1, 3.2, 3.4, and 3.11 and Sections 4.1, 4.2, 4.3 and 4.5 shall
survive for thirty-six (36) months from the Closing Date, and (ii) the
representations and warranties contained in Sections 3.10 and 3.13 shall survive
the Closing for the period of thirty (30) days past the applicable statute of
limitation plus any extensions or waivers thereof. From and after the
termination of each such representation and warranty, none of Seller, Buyer or
any officer, director, trustee or Affiliate of any of them shall have any
liability whatsoever with respect to any such representation or warranty.
Notwithstanding the immediately preceding sentence, any representation or
warranty in respect of which indemnity may be sought under this Agreement will
survive the time at which it would otherwise terminate pursuant to the
immediately preceding sentence if written notice of the alleged claim for
indemnification, is submitted in good faith together with an estimate of the
amount in question, to the Indemnifying Party; provided, further, that the
applicable representation or warranty will survive only with respect to the
particular inaccuracy or breach specified in such written notice. If after the
expiration of one hundred eighty (180) days from the date the representation or
warranty would have otherwise expired, the controversy is not fully and finally
resolved and/or a lawsuit has not been filed and service effected by the
Indemnified Party in a court of competent jurisdiction, the representation or
warranty in question shall expire. All agreements and covenants of the Parties
herein shall survive the Closing.

Section 9.4 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given as of the time of delivery or, in the case of
a facsimile communication, of confirmation, if delivered personally, by
facsimile (which is confirmed), or by overnight courier (providing proof of
delivery), to the Parties at the following addresses (or at such other address
for a Party as shall be specified by like notice):

 

If to Seller to:

   Dynegy Holdings Inc.             1000 Louisiana, Suite 5800            
Houston, Texas 77002             Attention: Executive Vice President            
Fax Number: (713) 767-5181         

 

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With copy to:

   Dynegy Holdings Inc.             1000 Louisiana, Suite 5800            
Houston, Texas 77002             Attention: General Counsel             Fax
Number: (713) 356-2185         

If to Buyer to:

   EnergyCo, LLC             4100 International Plaza             MS-FW93      
      Ft. Worth, TX 76109             Attention: President             Fax
Number: (817) 762-7928         

With copy to:

   LeBoeuf, Lamb, Greene & MacRae LLP             1000 Main Street, Suite 2550
            Houston, Texas 77002-5009             Attention: Thomas J. Moore   
         Fax Number: (713) 445-2166         

Section 9.5 Assignment; No Third Party Beneficiaries.

(a) This Agreement and all of the provisions hereof shall be binding upon and
inure to the benefit of the Parties and their respective successors and
permitted assigns, but neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by either Party, including by
operation of law, without the prior written consent of the other Parties.

(b) Other than as provided in Article 7, nothing in this Agreement is intended
to confer upon any other Person except the Parties any rights or remedies
hereunder or shall create any third party beneficiary rights in any Person.

Section 9.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas (regardless of the laws that
might otherwise govern under applicable principles of conflicts of law).

Section 9.7 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement and any
amendments hereto, to the extent signed and delivered by means of a facsimile
machine or e-mail of a PDF file containing a copy of an executed agreement (or
signature page thereto), shall be treated in all manner and respects and for all
purposes as an original agreement or instrument and shall be considered to have
the same binding legal effect as if it were the original signed version thereof
delivered in Person. At the request of any Party hereto, the other Party hereto
shall re-execute original forms thereof and deliver them to the requesting
Party. No Party hereto shall raise the use of a facsimile machine to deliver a
signature or the fact that any signature or agreement or instrument was
transmitted or communicated through the use of a facsimile machine or e-mail of
a PDF file containing a copy of an executed agreement (or signature page
thereto) as a defense to the formation or enforceability of this Agreement, and
each such Party forever waives any such defense.

 

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Section 9.8 Interpretation. When a reference is made in this Agreement to an
article, section, schedule or exhibit, such reference shall be to an article or
section of, or schedule or exhibit to, this Agreement unless otherwise
indicated. The table of contents and headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words “include,” “includes,” or
“including” are used in this Agreement, they shall be deemed to be followed by
the words “without limitation” or equivalent words. The words “hereof,” “herein”
and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement. All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
or thereto unless otherwise defined therein. The definitions contained in this
Agreement are applicable to the singular as well as the plural forms of such
terms and to the masculine as well as to the feminine and neuter genders of such
term. Any agreement, instrument, statute, regulation, rule or order defined or
referred to herein or in any agreement or instrument that is referred to herein
means such agreement, instrument, statute, regulation, rule or order as from
time to time amended, modified or supplemented, including (in the case of
agreements or instruments) by waiver or consent and (in the case of statutes,
regulations, rules or orders) by succession of comparable successor statutes,
regulations, rules or orders and references to all attachments thereto and
instruments incorporated therein. References to a Person are also to its
permitted successors and assigns. Each Party acknowledges that it has been
represented by counsel in connection with the review and execution of this
Agreement and, accordingly, there shall be no presumption that this Agreement or
any provision hereof be construed against the Party that drafted this Agreement.

Section 9.9 Jurisdiction and Enforcement; Waiver of Jury Trial.

(a) Each of the Parties irrevocably submits to the exclusive jurisdiction of
(i) any court of the State of Texas sitting in Harris County and (ii) the United
States District Court for the Southern District of Texas, for the purposes of
any suit, action or other proceeding arising out of this Agreement or any
transaction contemplated hereby. Each of the Parties agrees to commence any
action, suit or proceeding relating hereto in the United States District Court
for the Southern District of Texas or, if such suit, action or proceeding may
not be brought in such court for jurisdictional reasons, in any court of the
State of Texas sitting in Harris County. Each of the Parties further agrees that
service of process, summons, notice or document by hand delivery or U.S.
registered mail at the address specified for such Party in Section 9.4 (or such
other address specified by such Party from time to time pursuant to Section 9.4)
shall be effective service of process for any action, suit or proceeding brought
against such Party in any such court. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) any court of the State of Texas sitting in Harris County and
(ii) the United States District Court for the Southern District of Texas, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, EACH OF THE

 

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PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY
ACTION, PROCEEDING, OR COUNTERCLAIM RELATING TO, ARISING OUT OF, OR IN
CONNECTION WITH, THIS AGREEMENT, OR ANY MATTER ARISING HEREUNDER OR THEREUNDER.

(b) The Parties agree that irreparable damage would occur in the event that any
of the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
Parties shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement and to enforce specifically the terms and provision of this
Agreement, this being in addition to any other remedy to which they are entitled
at law or in equity.

Section 9.10 Entire Agreement. This Agreement including the exhibits, schedules,
documents, certificates and instruments referred to herein or therein, including
the Buyer Parent Guaranty, the Buyer Letter of Credit, the Technology Transfer
Agreement, the Transition Services Agreement and other Contracts, agreements and
instruments contemplated hereby or thereby, embody the entire agreement and
understanding of Seller and Buyer in respect of the transactions contemplated by
this Agreement. There are no restrictions, promises, representations,
warranties, covenants or undertakings other than those expressly set forth or
referred to herein or therein. This Agreement supersedes all prior agreements
and understandings among Seller, the Company and their respective Affiliates, as
applicable, and Buyer with respect to the transactions contemplated by this
Agreement.

Section 9.11 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the Parties as closely as possible to the fullest extent permitted by
applicable law in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the extent possible.

[The remainder of this page intentionally left blank]

 

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IN WITNESS WHEREOF, the Parties have caused this Purchase and Sale Agreement to
be signed by their respective duly authorized officers as of the date first
above written.

 

SELLER: DYNEGY HOLDINGS INC. By:  

/s/ Jason Hochberg

Name:   Jason Hochberg Title:   Executive Vice President BUYER: ENERGYCO, LLC
By:  

/s/ Mark Kubow

Name:   Mark Kubow Title:   President Generation and Development

 

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