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                                                                    EXHIBIT 10.1

                                  DYNEGY INC.

               DEFERRED COMPENSATION PLAN FOR CERTAIN DIRECTORS

     1. Participants.  Any director of the Company, other than a director who is
also a salaried officer or employee of the Company or any of its subsidiaries,
may elect to become a participant ("Participant") under this Plan by written
notice to the Company.

     2. Deferred Retainer and Fees. Any Participant may defer all or any portion
of his or her retainer and fees as a director which are earned for the ensuing
years of every service after the date of said election as he or she may specify
in said written notice to the Company, and such compensation so deferred shall
be paid only as hereinafter provided.  Any Participant may suspend future
deferments with respect to fees and retainers earned for ensuing years of
service after the date of suspension as he or she may specify by written notice
to the Company.  Following any such suspension, a director may make a new
election to again become a Participant.  No Participant may make such a change
more than once in any twelve-month period or again become a Participant within
twelve months after the date of suspension.  The election to defer for any year
shall be irrevocable and the retainer and fees for all of such year shall be
deferred until distribution in accordance with the terms of the Plan.  For
purposes of this Plan, a year of service shall begin on the date of an election
of a director and on the date immediately before the next annual meeting of
shareholders of the Company.

     3. Method of Deferral and Distribution.

        (a)    For each Participant electing to participate in the Plan, the
            Company shall maintain a deferred money account ("Deferred Money
            Account") which shall periodically be converted into a stock unit
            account ("Stock Unit Account") for each such Participant. Each
            Participant will be furnished annually with a statement of his
            account.

        (b)    Deferred retainers and fees of each Participant shall be credited
            as a dollar amount to the Participant's Deferred Money Account on
            the date they otherwise would be payable and converted into stock
            units quarterly at March 31, June 30, September 30 and December 31
            in each year by dividing the dollar balance of such Deferred Money
            Account as of the end of each such quarter by the last reported
            sales price per share of the Company's Class A Common Stock ("Common
            Stock") on the New York Stock Exchange Composite Tape on the last
            day upon which such stock was traded during each such quarter. The
            number of stock units for full shares so determined shall be
            credited to the Participant's Stock Unit Account and the aggregate
            value thereof at said closing price shall be charged to the
            Participant's Deferred Money Account. Any cash balance remaining in
            the Participant's Deferred Money Account after such charge shall be
            used together with other subsequent credits thereto at the next
            stock conversion period.



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         (c)    Additional credits will be made to each Participant's Deferred
             Money Account in dollar amounts equal to the cash dividends (or the
             fair market value of dividends paid in property). In the case of a
             stock dividend or stock split, additional credits will be made to
             each Participant's Stock Unit Account of the number of stock units
             equal to the number of full shares of the Company's Common Stock
             that such Participant would have received from the time to time he
             or she had been the owner on the record dates with respect thereto
             of the number of shares of the Company's Common Stock equal to the
             number of stock units in his or her Stock Unit Account in such
             dates.

     3.  Distribution.

         (a)    Upon termination of a Participant's services as a director;

             (i)     payment of the balance in his or her Deferred Money
                  Account, if any, remaining either after the conversion dates
                  occurring in the calendar year of his or her termination but
                  after his or her date of termination shall be made to the
                  Participant in cash, and;
             (ii)    payment of the balance in his or her Stock Unit Account
                  shall be made to the Participant in shares of Common Stock of
                  the Company;

in such number of annual installments as shall be determined by the Company in
its sole discretion, subject to the additional credits provided in paragraph
4(b). The Company may counsel with Participant's prior to such determination.
Each annual distribution shall be made as of January 31, beginning the January
31, following the termination of Participant's services as a director.

         (a)    The Stock Unit Account of a terminated Participant in this Plan,
             until complete distribution of such Account in whole shares of
             Common Stock of the Company shall be credited with additional
             credits in accordance with paragraph 3(c) above which such
             additional credits to the extent of the equivalent of whole shares
             of Common Stock of the Company shall be distributed in shares in
             the next annual installment. Any dollar amounts remaining which do
             not equal a whole share of Common Stock at the time of the last
             distribution installment of Common Stock shall be paid in cash to
             the Participant at the time of such distribution.

         (b)    If such Participant shall cease to be a director by reason of
             his or her death or if he or she shall die after he or she shall be
             entitled to distributions hereunder out prior to receipt of all
             distributions hereunder,
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            all cash or Common Stock then distributable hereunder shall be
            distributed to such beneficiary as such Participant shall designate
            by an instrument in writing filed with the Company, or in the
            absence of such designation, to his or her personal representative,
            or if none is appointed within six months of his or her death to his
            or her spouse, or if not then living, to his or her then living
            descendants, per stirpes, in the same manner and at the same
            intervals as they would have been made to such Participant had he or
            she continued to live.

     5. Participant's Rights Unsecured. The right of any Participant to receive
a distribution hereunder in Common Stock of the Company or in cash shall be an
unsecured claim against the general assets of the Company. The deferred
retainers and fees may not be encumbered or assigned by the Participant. The
Company may, but shall not be obligated, to acquire shares of its outstanding
Common Stock from time to time in anticipation of its obligation to make such
distributions under the Plan, but no Participant shall have any rights in or
against any shares of Common Stock so acquired or in any cash held in his or her
Deferred Money Account. All such Common Stock and cash shall constitute general
assets for the Company and may be disposed of by the Company at such time and
for such purposes as it may deem appropriate.

     6. Amendments to the Plan. The Board of Directors of the Company may amend
the Plan at any time, without the consent of the Participant or other
beneficiaries, provided, however, that no amendment shall divest any Participant
or beneficiary of rights to which he or she would have been entitled if the Plan
had been terminated on the effective date of such amendment.

     7. Termination of the Plan. The Board of Directors of the Company may
terminate the Plan at any time. Upon termination of the Plan, distributions in
respect of credits to a Participant's Account as of the date of the date of
termination shall be made in the manner and at the time heretofore prescribed.

     8. Expenses. Costs of administration of the Plan will be paid by the
Company.