--------------------------------------------------------------------------------

Exhibit 10.13
 
 
CONTRACT FOR SERVICES
 
 
This Contract for Services (“Contract”) is made between Larry F. Altenbaumer
(“Contractor”) and Illinois Power Co., an Illinois Corporation (the “Company”),
and is executed this 27 th day of January, 2004. This Contract is effective
April 1, 2004 (the “Effective Date”).
 
1.    Term of Agreement. The term of this Contract shall commence on the
Effective Date and end on March 31, 2005 (the “Termination Date”). Either party
may terminate this Contract prior to the Termination Date, subject to the
conditions specified in Section 6 below.
 
2.    Duties of Contractor. Contractor will provide consulting services to the
Company on an as-needed basis to be determined by the Company. Contractor shall
not have an office at the Company’s corporate offices in Decatur, Illinois, but
shall have access to a guest office when his presence at that location is
necessary. Contractor will report directly to R. Blake Young (“Young”),
Executive Vice President, Administration and Technology, of the Company’s
Parent, Dynegy Inc. (“Dynegy”), and will receive assignments from Young or any
employee of the Company or Dynegy designated by Young. Contractor’s primary
focus will be to actively assist Dynegy, at Dynegy’s direction and request, in
any reasonable manner possible in meeting Dynegy’s business objectives with
respect to the disposition, retention, or restructuring of the Company,
including, but not limited to, lobbying on behalf of the Company or Dynegy with
entities responsible for making public policy and advocating Dynegy’s business
objectives in the community and in the political arena. Contractor shall observe
and comply with all lawful and reasonable directions and instructions by and on
the part of Dynegy’s management, endeavor to promote the interests of Dynegy,
and do nothing that may cause or be likely to cause any loss or damage to Dynegy
in business, reputation or otherwise. When performing services under this
Contract, Contractor shall abide by all provisions of Dynegy’s Code of Business
Conduct and Ethics (the “Code”), as may be amended from time to time, which is
incorporated herein by reference and attached hereto as Exhibit A. Dynegy will
provide Contractor with any new versions of the Code that may be adopted during
the term of this Contract. Contractor’s failure to achieve any specified result
in the performance of services under this contract does not constitute a breach
of this Agreement or release the Company from its obligation to make the
payments required hereunder. In connection with the performance of services
under this Contract, Contractor shall be indemnified on the terms provided in
Section 5 of Contractor’s employment agreement with Dynegy, Inc., effective
December 20, 1999, which Section 5 is hereby incorporated by reference.
 
3.    Compensation. The Company shall pay Contractor, on March 31, 2005,
$357,500.00, for services rendered under the Contract and to assist with
outplacement after the Termination Date.

 
     

--------------------------------------------------------------------------------

 

4.    Consulting Relationship and Taxation. Contractor is an independent
contractor and, as a result, the Company will not withhold any monies from
Contractor’s compensation for the purposes of any United States’ or other
country’s federal or state taxing authority. Contractor is solely responsible
for any tax liability in whatever country or nation arising from the
compensation the Company pays Contractor under the terms of this Contract.
Contractor agrees that, in the event it is determined by some taxing authority
that the payments under this Contract are subject to any United States or
foreign tax liability, he shall be fully responsible for said liability and
hereby agrees to fully indemnify and hold the Company harmless for any amounts
determined to be due and owing by Contractor, including any fines, interest or
penalties.
 
5.    Expenses. The Company agrees to reimburse Contractor for all reasonable
and customary travel and other expenses related to the performance of his duties
under the Contract.
 
6.    Termination of the Contract. Between the Effective Date and the
Termination Date, either the Company or Contractor may terminate this Contract
with thirty (30) days written notice to the other party. If the Company
terminates the Contract under this Section 6, Contractor will be entitled to a
payment of all monies owed to Contractor as if the term of the Contract had been
completed. Such compensation will be paid to Contractor in one lump sum on the
date set forth in Section 3. If Contractor terminates the Contract under this
Section 6, Contractor will not be entitled to any further compensation except
that which was earned prior to the date of the written notice of termination.
The amount earned will be calculated by taking the amount set forth in Section
3, dividing that amount by 52 weeks, and multiplying that amount by the number
of weeks Contractor provided services under the Contract up to the date of
written notice of termination. Such compensation will be paid to Contractor in
one lump sum on the 15 th day of the month following the expiration of the
thirty (30) day notice period; provided, however, that Contractor may, by
written notice to the Company, elect to defer payment of such compensation to
March 31, 2005. In the event of Contractor’s death or disability that precludes
further performance under the Contract, this Contract shall be deemed to have
been terminated by Contractor as of the date of death or disability and governed
by the language of this Section 6.
 
7.    Contractor’s Confidentiality Agreement. Contractor acknowledges that the
Company has established a valuable and extensive trade in the services it
provides, which has been developed at considerable expense to the Company.
Contractor agrees that, by virtue of this Contract, Contractor will have access
to certain information and knowledge of the business and operations of the
Company and Dynegy that are confidential and proprietary in nature.
 
Contractor agrees that he will not at any time during the term of the Contract,
or thereafter, disclose to others, use, copy or permit to be copied any secret
or confidential information of the Company (whether or not developed by
Contractor) without the prior written consent of Young. The term “secret or
confidential information of the Company” (sometimes referred to herein as
“Confidential Information”) shall include, without limitation, the Company’s
(and Dynegy’s) plans; strategies; potential acquisitions; costs; prices; systems
for buying, selling, and/or trading natural gas, natural gas liquids, crude

Page 2
     

--------------------------------------------------------------------------------

 

oil, coal, electricity, bandwidth and communications services; client lists;
pricing policies; financial information; the names of and pertinent information
regarding suppliers; computer programs; policy or procedure manuals; training
and recruiting procedures; accounting procedures; the status and content of the
Company’s contracts with its suppliers or clients; or servicing methods and
techniques at any time used, developed, or investigated by the Company or
Dynegy; before or during the term of the Contract, to the extent any of the
foregoing are (i) not generally available to the public and (ii) maintained as
confidential by the Company or Dynegy. Contractor further agrees to maintain in
confidence any confidential information of third parties received as a result of
this Contract.
 
Contractor further agrees that any materials and/or information developed by him
for the Company’s or Dynegy’s use during the term of this Contract are the sole
and exclusive property of the Company or Dynegy. Any materials or information
that are the property of the Company or Dynegy shall be returned to the Company
or Dynegy immediately upon termination of this Contract or upon oral or written
request. Contractor further agrees that any use of said materials or information
subsequent to termination of this Contract or a request of return shall
constitute a violation of this Contract. Contractor agrees that, upon
termination of this Contract, he shall promptly return any and all documents
containing the above information, knowledge or data, or relating thereto, to the
Company. Contractor acknowledges that the Confidential Information is created at
substantial cost and expense to the Company and Dynegy and that unauthorized use
or disclosure would cause irreparable injury to the Company and Dynegy.
 
8.    Agreement Not to Compete or Seek Conflicting Employment. During the term
of this Contract, Contractor shall not provide his services, whether by
employment or consulting arrangement, to any federal, state or local
governmental entity, or any utility, natural gas provider, or electric
generation company doing business in the State of Illinois, without the prior
written permission of Young. Should Contractor fail to seek and obtain such
permission prior to the commencement of such services, then, notwithstanding
Section 6 of this Contract, this Contract shall be immediately terminated and
all compensation set forth in Section 3 of this Contract shall be forfeited.
Should such permission be granted, Contractor shall be deemed to have terminated
the Contract pursuant to Section 6 of this Contract as of the date permission is
granted, which date shall serve as the date of written notice of termination.
 
9.    Agreement Not to Solicit or Recruit Employees of the Company. During the
term of this Contract and for 12 months thereafter, Contractor agrees to refrain
from soliciting, recruiting, encouraging, or initiating contact with any of the
Company’s employees in any way for the purpose of offering them employment,
either as an employee or as a contractor or adviser, with Contractor, directly
or indirectly, for himself or with or for others. During the term of this
Contract and for 12 months thereafter, Contractor further agrees to refrain from
authorizing, directing, or advising any third persons or entities to solicit,
recruit, encourage, or initiate contact with any of the Company’s employees in
any way for the purpose of offering them employment, either as an employee or as
a contractor or adviser, with Contractor, directly or indirectly, for himself or
with or for others.

Page 3
     

--------------------------------------------------------------------------------

 

10.    Cessation of Business. Notwithstanding any provisions in this Contract to
the contrary, in the event that the Company shall cease operating its business,
then this Contract shall terminate as of the last day of the month in which the
Company ceases operations, with the same force and effect as if such last day of
the month originally was set as the Termination Date. A merger, acquisition,
sale, or similar corporate restructuring under which the principal business of
the Company is continued shall not be considered cessation of the business of
the Company.
 
11.    Dispute Resolution. Contractor hereby agrees that any dispute relating to
this Contract or to the breach of this Contract arising between Contractor and
the Company shall be first submitted to mediation before a mediator mutually
selected and agreed upon by the parties. The mediation shall take place in
Decatur, Illinois. Any settlement resolving such a dispute, at mediation or
otherwise, shall be final and binding upon the parties. Should a dispute related
to the Contract fail to resolve at mediation, the parties will submit the matter
to arbitration in accordance with the arbitration rules of the American
Arbitration Association. The arbitration proceeding, including the rendering of
an award, shall take place in Decatur, Illinois. All fees and expenses
associated with the arbitration shall be allocated by the arbitrator(s). The
award of the arbitrator shall be final and binding upon the parties without
appeal or review except as permitted by the Federal Arbitration Act.
 
12.    Waiver of Breach of Agreement. If either party waives a breach of this
Contract by the other party, that waiver will not operate or be construed as a
waiver of any other or subsequent breaches.
 
13.    Waiver of Implied Warranties and Representations. The terms, conditions,
representations, warranties, covenants and provisions applicable to this
Contract are set forth expressly and completely in this Contract. The parties
hereby waive, disclaim and negate for all purposes (i) any other term,
condition, representation, warranty, covenant and/or provision of any kind
hereunder , whether implied, statutory, or other; and (ii) any right of quantum
meruit in connection with any work or service provided hereunder or contemplated
hereby.
 
14.    Notice. Any notice given by the Company to Contractor under this Contract
shall be sufficient if in writing and either (1) hand delivered to Contractor,
or (2) mailed, return receipt requested, to Contractor’s last address on the
records of the Company. Any notice given by Contractor to the Company under this
Contract shall be sufficient if in writing and either (1) hand delivered to
Young, or (2) mailed, return receipt requested, to Young as follows:

R. Blake Young
Executive Vice President,
Administration and Technology,
Dynegy Inc.
1000 Louisiana, Suite 5800
Houston, TX 77002

Page 4
     

--------------------------------------------------------------------------------

 

15.    Assignment. This Contract is assignable by either party only with the
express written consent of the other party.
 
16.    Severability. Any provisions of this Contract prohibited by or
unenforceable under any applicable law of any jurisdiction shall as to such
jurisdiction be deemed ineffective and deleted from this Contract without
affecting any other provision of this Contract or the effectiveness of such
provision in any jurisdiction in which it is not prohibited or unenforceable. It
is the desire of the parties hereto that this Contract be enforced to the
maximum extent permitted by law, and should any provision contained herein be
held unenforceable, the parties hereby agree and consent that such provision
shall be reformed to make it a valid and enforceable provision to the maximum
extent permitted by applicable law.
 
17.    Survival of Provisions. The provisions of Sections 7, and 11 through 19,
inclusive, of this Contract shall survive termination of this agreement and
shall be enforceable by the Company and the Contractor for a period of two years
after such termination, regardless of the circumstances of such termination,
except that the provisions of Section 7 shall survive forever and the provisions
of Section 9 shall survive according to Section 9’s terms.
 
18.    Choice of Law and Forum. This Contract shall be construed and governed by
the laws of the State of Illinois. Any and all matters of dispute arising out
of, or in any way connected with, this Contract or the relationship between
Contractor and the Company, except arbitration matters governed by Section 11
above, shall be subject to determination only by the Courts of and for Decatur,
Illinois. Contractor and the Company hereby consent and submit to the exclusive
jurisdiction of the Courts of and for Decatur, Illinois.
 
19.    Entire Agreement and Amendment. This Contract supersedes any and all
other agreements, either oral or in writing, between the parties hereto with
respect to the Company’s retention of Contractor. This Contract contains the
entire agreement of the parties with respect to the subject matter covered
hereby and may be amended, waived or terminated only by an instrument in writing
executed by both parties hereto.
 
20.    Binding on Successors and Assigns. This Contract is binding on the
Company and its successors and assigns.

Contractor
 

/s/ Larry F. Altenbaumer
January 27, 2004
Larry F. Altenbaumer
 

* * *

 Page 5

     

--------------------------------------------------------------------------------

 

Illinois Power Company

/s/ Bruce A. Williamson
January ____, 2004
By: Bruce A. Williamson
 

Page 6
     

--------------------------------------------------------------------------------