Exhibit 10.1

 

GUARANTY

 

This Guaranty (as amended, restated, supplemented or otherwise modified from
time to time, this “Guaranty”) dated as of August 3, 2016 is made by Dynegy
Inc., a Delaware corporation (“Guarantor”) in favor of J-POWER USA Development
Co., Ltd., a Delaware corporation (“Beneficiary”)

 

WITNESSETH:

 

WHEREAS, Beneficiary and Elwood Expansion Holdings, LLC, a Delaware limited
liability company, Elwood Energy Holdings, LLC, a Delaware limited liability
company, Tomcat Power, LLC, a Delaware limited liability company and Elwood
Energy Holdings II, LLC, a Delaware limited liability company (together,
“Sellers”), are parties to that certain Membership Interest Purchase Agreement
dated as of the date hereof (the “MIPA”), for the sale by Sellers of the
Transferred Interests (as defined in the MIPA);

 

WHEREAS, Sellers are wholly-owned indirect subsidiaries of Guarantor, and
Guarantor will receive a continuing benefit from Beneficiary’s execution and
performance of the MIPA; and

 

WHEREAS, subject to the terms and conditions set forth herein, in order to
induce Beneficiary to enter into the MIPA, Guarantor desires to guarantee the
payment and performance obligations of Sellers set forth in the MIPA.

 

NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Guarantor agrees as follows:

 

ARTICLE 1
DEFINITIONS; RULES OF INTERPRETATION

 

Section 1.1                                   Definitions.  Capitalized terms
used herein and not otherwise defined shall have the meanings given in the MIPA.

 

Section 1.2                                   Rules of Interpretation.  The
rules of interpretation set forth in Section 1.02 of the MIPA shall apply,
mutatis mutandis, to this Guaranty.

 

ARTICLE 2
GUARANTY

 

Section 2.1                                   Guaranty.  For value received,
Guarantor hereby absolutely, unconditionally and irrevocably guarantees to
Beneficiary, as primary obligor and not as surety, the prompt payment and
performance of all obligations, now or hereafter existing, of Sellers
(including, without limitation, any assignee permitted thereunder) under the
MIPA, including, without limitation, the payment of any amounts due pursuant to
Section 8.01 of the MIPA to Beneficiary or other Indemnified Purchaser Entity
(together with any and all costs and expenses, including reasonable counsel fees
and expenses, incurred by Beneficiary in enforcing its rights under this
Guaranty, the “Guarantied Obligations”) whether according to the present terms
of the

 

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MIPA or pursuant to any change in the terms, covenants or conditions of the MIPA
at any time after the date hereof made or granted, including, without
limitation, pursuant to any amendments, or waivers affecting the MIPA and the
transactions contemplated by the MIPA.  In the event that Sellers fail in any
manner whatsoever to pay or perform any of the Guarantied Obligations when due,
Guarantor will itself duly and promptly pay and perform the Guarantied
Obligations, or cause the Guarantied Obligations to be duly and promptly paid
and performed, in each case as if Guarantor were itself Sellers with respect to
the Guarantied Obligations.  This Guaranty shall remain in full force and effect
from the date hereof until payment and performance in full of the Guarantied
Obligations.

 

Section 2.2                                   Nature of Guaranty.  This Guaranty
constitutes a Guaranty of payment and performance when due and not of
collection, and Guarantor specifically agrees that it shall not be necessary or
required that Beneficiary exercise any right, assert any claim or demand or
enforce any remedy whatsoever against Sellers either before or as a condition to
the obligations of Guarantor hereunder; provided, that Guarantor shall have the
benefit of and the right to assert any defenses against the claims of
Beneficiary that are available to Sellers, and that would have also been
available to Guarantor if Guarantor had been in the same contractual position as
Sellers under the MIPA other than (a) defenses arising from the insolvency,
reorganization or bankruptcy of Sellers, (b) defenses expressly waived in this
Guaranty, and (c) defenses previously asserted by Sellers against such claims to
the extent such defenses have been finally resolved in Beneficiary’s favor by a
court of last resort.  For the avoidance of doubt, payment or performance by
Guarantor under the MIPA shall be due hereunder when and if such payment or
performance is due (and in the case of a payment, payable) by Sellers (by
acceleration or otherwise) to Beneficiary or other Indemnified Purchaser Entity
under Article 8 of the MIPA.  All sums payable by Guarantor hereunder shall be
paid by wire transfer of immediately available funds to an account designated by
Beneficiary.

 

Section 2.3                                   Unconditional Obligations.  The
obligations of Guarantor under this Guaranty are independent of the Guarantied
Obligations and any obligations of Sellers under the MIPA, and an action may be
brought and prosecuted against Guarantor to enforce this Guaranty, irrespective
of whether any action is brought against Sellers, or whether Sellers are joined
in any such action or actions.  The liability of Guarantor under this Guaranty
shall be irrevocable, absolute and unconditional irrespective of, and Guarantor
hereby irrevocably waives, any circumstance that constitutes a legal or
equitable discharge under applicable Law of a guarantor or surety other than
satisfaction in full of the Guarantied Obligations including, for the avoidance
of doubt, (i) the validity, legality or enforceability of the MIPA or any
agreement or document in connection with the MIPA, any of the Guarantied
Obligations or any collateral security therefor or guarantee or right of offset
with respect thereto at any time or from time to time held by Sellers, (ii) any
claim, set-off, counterclaim or other right which may at any time be available
to or be asserted by Sellers or Guarantor against Beneficiary or any of its
Affiliates in connection with the Guarantied Obligations or otherwise, (iii) any
requirement that Beneficiary exhaust any right to take any action against
Sellers or any other Person prior to or contemporaneously with proceeding to
exercise any right against Guarantor under this Guaranty, (iv) any change in the
applicable Law of any jurisdiction, or (v) any present or future action of any
Governmental Entity amending, varying, reducing or otherwise affecting or
purporting to amend, vary, reduce or otherwise affect, any of the obligations of
Sellers under the MIPA or of Guarantor under this

 

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Guaranty, and Guarantor hereby waives any defense based on or arising out of any
of the foregoing clauses (i) through (v).

 

Without limiting the generality of the foregoing, Guarantor hereby agrees,
acknowledges and represents and warrants to Beneficiary as follows:

 

(a)         Guarantor hereby waives any defense arising by reason of, and any
and all right to assert against Beneficiary any claim or defense based on, an
election of remedies by Beneficiary which in any manner impairs, affects,
reduces, releases, destroys and/or extinguishes Guarantor’s rights to proceed
against Sellers or any other guarantor for reimbursement, indemnification or
contribution, and/or any other rights of Guarantor to proceed against Sellers,
any other guarantor, or any other Person or security.

 

(b)         Guarantor has independently reviewed the MIPA and has made an
independent determination as to the validity and enforceability thereof, and in
executing and delivering this Guaranty to Beneficiary, Guarantor is not in any
manner relying upon the validity, and/or enforceability, and/or attachment,
and/or perfection of any Liens of any kind or nature granted by Sellers to
Beneficiary, now or at any time and from time to time in the future.

 

Section 2.4                                   Waiver.  Guarantor hereby
unconditionally waives promptness, presentment, demand of payment, protest for
nonpayment or dishonor, diligence, notice of acceptance and any other notice
with respect to any of the Guarantied Obligations by Beneficiary, and all
defenses not otherwise available to Sellers under the MIPA which may be
available to Guarantor by virtue of any valuation, stay, moratorium law or other
similar law now or hereafter in effect and any right to require the marshalling
of assets of Sellers or any other Person interested in the transactions
contemplated by the MIPA.  The Guarantied Obligations, and any of them, shall
conclusively be deemed to have been created, contracted or incurred in reliance
upon this Guaranty and all dealings between Sellers or Guarantor, on the one
hand, and Beneficiary, on the other hand, shall likewise be conclusively
presumed to have been had or consummated in reliance upon this Guaranty. 
Guarantor hereby waives any defense based on (a) lack of authority of Sellers to
enter into the MIPA or perform their obligations thereunder, (b) the failure of
Sellers or any of their Affiliates to assert any claim or demand or to enforce
any right or remedy under the provisions of the MIPA or any agreement or other
document in connection with the MIPA or the transactions contemplated thereby,
(c) any rescission, waiver, amendment or modification of any of the terms or
provisions of the MIPA or any agreement or other document in connection with the
MIPA (including, without limitation, any change in the time, place or manner of
payment or performance of the Guarantied Obligations), (d) any insolvency,
bankruptcy, reorganization, assignment for the benefit of creditors,
liquidation, dissolution, or similar proceedings with respect to Sellers,
(e) the release of, or any impairment of or failure to protect, secure, perfect
or insure any Lien at any time held by Sellers at any time for the payment of
the Guarantied Obligations, (f) any default, failure or delay, willful or
otherwise, in the performance of the Guarantied Obligations, (g) the sale,
exchange, waiver, surrender, substitution or release of any collateral security,
guarantee or right of offset at any time held by Sellers for the payment of the
Guarantied Obligations, (h) the adequacy of any other means Beneficiary may have
of obtaining payment and performance of the Guarantied Obligations, (i) change
of name, purpose, structure, organizational documents or ownership of Sellers
and (j) any

 

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change in the financial condition of Guarantor or Sellers.  Without limitation,
Beneficiary may at any time and from time to time without notice to or consent
of Guarantor and without impeding or releasing the obligations of Guarantor
hereunder: (i) make any change to the terms of the Guarantied Obligations,
including granting extensions, renewals, release or discharges of Sellers;
(ii) take or fail to take any action of any kind in respect of any security for
the Guarantied Obligations; (iii) exercise or refrain from exercising any rights
against Sellers in respect of the Guarantied Obligations; (iv) compromise or
subordinate the Guarantied Obligations, including any security therefore or
accept settlement from Sellers; or (v) apply any sums received to any
indebtedness for which Sellers are liable, whether or not such indebtedness is a
Guarantied Obligation.

 

Section 2.5                                   No Subrogation.  Notwithstanding
any payment or payments made by Guarantor under this Guaranty or any set-off or
application of funds of Guarantor by Beneficiary, Guarantor shall not be
entitled to be subrogated to any of the rights of Beneficiary against Sellers or
any collateral security or Guaranty or right of offset held by Beneficiary for
the payment of the Guarantied Obligations, nor shall Guarantor seek or be
entitled to seek any contribution or reimbursement from Beneficiary in respect
of payments made by Guarantor under this Guaranty.

 

Section 2.6                                   Representations and Warranties. 
Guarantor hereby represents and warrants that:

 

(a)                                 it is a corporation duly organized and
validly existing under the laws of Delaware;

 

(b)                                 the execution, delivery and performance by
it of this Guaranty are within its corporate powers, have been duly authorized
by all necessary corporate action, and do not contravene (i) its articles of
incorporation  and any other organizational documents, (ii) any contractual
restriction binding on or affecting it or its assets or (iii) applicable Law;

 

(c)                                  no consent of any Person is required for
the due execution, delivery and performance by it of this Guaranty;

 

(d)                                 this Guaranty has been duly executed and
delivered by Guarantor and is the legal, valid and binding obligation of
Guarantor enforceable against Guarantor in accordance with its terms, except to
the extent that enforceability may be limited by bankruptcy, insolvency or other
laws affecting creditors’ rights generally;

 

(e)                                  there is no claim now pending or, to the
best of its knowledge, threatened against it before any Governmental Entity or
arbitral tribunal that is reasonably likely to have a material adverse effect on
its ability to perform its obligations under this Guaranty; and

 

(f)                                   no bankruptcy, reorganization or
insolvency proceedings are pending by or against Guarantor, as debtor.

 

Section 2.7                                   Termination.  If the MIPA is
terminated prior to the Closing, this Guaranty shall terminate and be of no
further force or effect.  Subject to Section 2.3, this Guaranty shall terminate
and be of no further force or effect with respect to the Guarantied Obligations
on the

 

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date that is two (2) years following the Tier One Closing Date; provided,
however, that, subject to the terms and conditions of this Guaranty, any such
termination shall not prejudice any outstanding claim validly made by
Beneficiary against Guarantor hereunder prior to such termination date.

 

ARTICLE 3
MISCELLANEOUS

 

Section 3.1                                   Governing Law.  This Guaranty
shall be governed by and interpreted in all respects in accordance with the laws
of the State of New York without reference to conflicts of laws.

 

Section 3.2                                   Consent to Jurisdiction. 
Guarantor, and, by acceptance hereof, Beneficiary hereby irrevocably and
unconditionally (a) submits to the non-exclusive jurisdiction of any New York
state or federal court sitting in Manhattan in any action or proceeding arising
out of or relating to this Guaranty, or for recognition or enforcement of any
judgment, (b) agrees that all claims in respect of any such action or proceeding
may be heard and determined in any such court, (c) agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
Law, and (d) waives, to the fullest extent permitted by Law, any objection that
it may now or hereafter have to the laying of venue of any action or proceeding
arising out of this Guaranty and any claim that any such action or proceeding
has been brought in an inconvenient forum.  Guarantor irrevocably appoints its
registered agent as its agent to receive service of process or other legal
summons for purposes of any such action or proceeding.  Nothing herein shall
affect the right of Beneficiary to serve process in any other manner permitted
by Law or to commence legal proceedings or otherwise proceed against Guarantor
in any other jurisdiction.  Guarantor agrees that service of process, summons,
notice or other documents in the manner set forth in Section 3.5 to its
registered agent at the address set forth in Section 3.5 will be effective
service or process for any action, suit, or proceeding brought against it in any
New York state or federal court sitting in Manhattan, 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.

 

Section 3.3                                   Waiver of Jury Trial.  GUARANTOR,
AND, BY ACCEPTANCE HEREOF, BENEFICIARY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
IRREVOCABLY WAIVES ANY RIGHT IT MAY NOW OR HEREAFTER HAVE TO A TRIAL BY JURY IN
ANY LITIGATION BASED HEREIN, OR ARISING OUT OF, UNDER, OR IN RESPECT OF THIS
GUARANTY, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF BENEFICIARY OR GUARANTOR.

 

Section 3.4                                   Amendments, Etc.  No amendment or
waiver of any provision of this Guaranty, and no consent to any departure by
Guarantor or Beneficiary herefrom, shall in any event be effective unless the
same shall be in writing and signed by Beneficiary and Guarantor, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given.

 

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Section 3.5                                   Notices.  Unless otherwise
expressly specified or permitted hereunder, all notices, approvals, consents,
waivers and other communications provided for herein between Guarantor and
Beneficiary shall be in writing or shall be produced by a telecommunications
device capable of creating a written record, and any such communication shall
become effective (a) upon personal delivery thereof, including by overnight mail
or next Business Day or courier service, (b) in the case of notice by U.S. mail,
certified or registered, postage prepaid, return receipt requested, upon receipt
thereof, or (c) in the case of notice by a telecommunications device, upon
transmission thereof; provided, that such transmission is promptly confirmed, in
each case addressed as provided in this Section 3.5, or to such other address as
the relevant Person may designate by notice to:

 

If to Guarantor, to:

 

with a copy to:

 

 

 

Dynegy Inc.

 

Skadden, Arps, Slate, Meagher & Flom LLP

601 Travis Street

 

1440 New York Avenue, N.W.

Houston, TX 77002

 

Washington, D.C. 20005

Attn: Catherine James, Esq., Executive Vice President and General Counsel

 

Attention: Michael P. Rogan

 

Facsimile No.: (202) 661-8200

Facsimile No.: (713) 507-6808

 

Email: michael.rogan@skadden.com

Email: catherine.james@dynegy.com

 

 

 

 

 

If to Beneficiary, to:

 

with a copy to:

 

 

 

J-POWER USA Development Co., Ltd.

 

James P. O’Brien

1900 East Golf Road, Suite 1030

 

Baker & McKenzie LLP

Schaumburg, Illinois 60173

 

300 E. Randolph Drive, Suite 5000

Phone: (847) 908-2800

 

Chicago, IL 60601

Fax: (847) 908-2888

 

Facsimile No.: (312) 698-2324

 

 

Email: james.p.o’brien@bakermckenzie.com

 

Section 3.6                                   No Waiver; Remedies.  No failure
on the part of Beneficiary or Guarantor to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right.  The remedies herein provided are
cumulative and not exclusive of any remedies provided by Law.

 

Section 3.7                                   Severability.  In case any one or
more of the provisions contained in this Guaranty should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impeded thereby.

 

Section 3.8                                   Entire Agreement.  This Guaranty
and any agreement, document or instrument referred to herein integrate all the
terms and conditions mentioned herein or incidental hereto and supersede all
oral negotiations and prior writings in respect of the subject matter hereof.

 

Section 3.9                                   Continuing Guaranty.  This
Guaranty is a continuing Guaranty and shall (a) remain in full force and effect
until payment and performance in full of the Guarantied

 

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Obligations, (b) be binding upon Guarantor and its successors and assigns and
(c) inure to the benefit of and be enforceable by Beneficiary and its successors
and assigns.  Notwithstanding the foregoing, neither of Guarantor nor
Beneficiary may assign its rights or obligations hereunder in whole or in part
to any other Person, and no assignment shall relieve Guarantor of its
obligations hereunder; provided that Beneficiary shall have the right to assign
this Guaranty to an assignee of the MIPA under Section 10.11 of the MIPA.

 

Section 3.10                            Financial Condition of Sellers. 
Guarantor is familiar with the financial conditions of Sellers, and has executed
and delivered this Guaranty based on Guarantor’s own judgment and not in
reliance upon any statement or representation of Beneficiary. Beneficiary shall
have no obligation to provide Guarantor with any advice or to inform Guarantor
at any time of Beneficiary’s actions, evaluations or conclusions on the
financial condition or any other matter concerning Sellers.

 

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IN WITNESS WHEREOF, Guarantor, intending to be legally bound, has caused this
Guaranty to be executed by its duly authorized representative as of the date
first written above.

 

 

 

DYNEGY INC.

 

 

 

 

 

By:

/s/ Mathew J. Parker

 

Name: Mathew J. Parker

 

Title: VP and Chief Risk Officer

 

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