Exhibit 10.1

 

EXECUTION VERSION

 

BUYER GUARANTEE

 

	
THIS GUARANTY AGREEMENT (this “Guaranty”),   dated as of August 21, 2014 is issued and delivered by DYNEGY INC., a Delaware corporation   (the “Guarantor”), for the account of DYNEGY   RESOURCE I, LLC, a Delaware limited liability company (the “Obligor”),   and for the benefit of Duke Energy SAM, LLC,   a Delaware limited liability company (“DESAM”), and Duke Energy Commercial Enterprises, Inc., an Indiana   corporation (“DECAM” and together with DESAM, the “Beneficiaries”).

 

Background Statement

 

WHEREAS,   the Beneficiaries and Obligor entered into that certain Purchase and Sale   Agreement, dated as of August 21, 2014 (the “Purchase Agreement”);

 

WHEREAS,   in accordance with the Purchase Agreement, the Beneficiaries and Obligor   intend to enter into a Transition Services Agreement upon the closing of the   transactions contemplated in the Purchase Agreement (the “Transition   Services Agreement” and together the Purchase Agreement, the “Agreements”);   and

 

WHEREAS,   Beneficiaries have required that the Guarantor deliver to the Beneficiaries   this Guaranty as an inducement to enter into the Agreements.

 

Agreement

 

NOW, THEREFORE, in consideration of the   foregoing and for good and valuable consideration, the Guarantor hereby   agrees as follows:

 

1.              Guaranty; Limitation of   Liability.  Subject   to any rights, setoffs, counterclaims and any other defenses that the   Guarantor expressly reserves to itself under this Guaranty, the Guarantor   (i) absolutely and unconditionally guarantees the timely payment of the   Obligor’s payment and performance obligations under each Agreement and   (ii) agrees to cause the Obligor to perform all of its other obligations   under each Agreement (such payment and other obligations of the Obligor, the   “Guaranteed Obligations”); provided, however, that   the Guarantor’s aggregate liability hereunder shall not exceed two billion   eight hundred million U. S. Dollars (U.S.   $2,800,000,000).

 

Subject   to the other terms of this Guaranty, the liability of the Guarantor under   this Guaranty is limited to making payments and causing performance expressly   required under the Agreements, and except as specifically provided therein,   the Guarantor shall not be liable for or required to pay any consequential or   indirect loss (including but not limited to loss of profits), exemplary   damages, punitive damages, special damages, or any other damages or costs.

 

2.              Effect of Amendments.  The Guarantor agrees that the Beneficiaries   and the Obligor may modify, amend and supplement the Agreements and that the   Beneficiaries may delay or extend the date on which any payment must be made   pursuant to either Agreement or delay
    	
 
    	
or   extend the date on which any act must be performed by the Obligor thereunder,   all without notice to or further assent by the Guarantor, who shall remain   bound by this Guaranty, notwithstanding any such act by the Beneficiaries.

 

3.                          Waiver of   Rights.  The   Guarantor expressly waives (i) protest, (ii) notice of acceptance   of this Guaranty by the Beneficiaries, and (iii) demand for payment of   any of the Guaranteed Obligations.

 

4.                          Reservation   of Defenses.  Without   limiting the Guarantor’s own defenses and rights hereunder, the Guarantor   reserves to itself all rights, setoffs, counterclaims and other defenses that   the Obligor may have to payment of all or any portion of the Guaranteed   Obligations except defenses arising from the bankruptcy, insolvency,   dissolution or liquidation of the Obligor and other defenses expressly waived   in this Guaranty.

 

5.              Settlements   Conditional.  If any   monies paid to the Beneficiaries in reduction of the indebtedness of the   Obligor under either Agreement have to be repaid by the Beneficiaries by   virtue of any provision or enactment relating to bankruptcy, insolvency or   liquidation for the time being in force, the liability of the Guarantor under   this Guaranty shall be computed as if such monies had never been paid to the   Beneficiaries.

 

6.              Notice.  The Beneficiaries will provide written   notice to the Guarantor if the Obligor defaults under either Agreement.

 

7.              Primary   Liability of the Guarantor.  The Guarantor agrees that the Beneficiaries   may enforce this Guaranty without the necessity at any time of resorting to   or exhausting any other security or collateral.  This is a continuing Guaranty of payment   and not merely of collection.

 

8.              Term of   Guaranty.  This   Guaranty shall remain in full force and effect until the earlier of (i) such   time as all the Guaranteed Obligations have been discharged, and (ii) the   date that is six (6) months after the date that the Purchase Agreement   is terminated in accordance with its terms (the “Expiration Date”); provided,   however, the Guarantor will remain liable hereunder for Guaranteed   Obligations that were outstanding prior to the Expiration Date.

 

9.              Governing Law.  This Guaranty shall be governed by and   construed in accordance with the internal laws of the State of New York,   including Section 5-1401 of the General Obligations Law of the State of   New York, but otherwise without giving effect to principles of conflicts of   law.

 

10.       Expenses.  The Guarantor agrees to pay all reasonable   out-of-pocket expenses (including the reasonable fees and expenses of the   Beneficiaries’ counsel) relating to the enforcement of the Beneficiaries’   rights hereunder in the event the Guarantor disputes its obligations under   this
    


 











 

	
Guaranty   and it is finally determined (whether through settlement, arbitration or   adjudication, including the exhaustion of all permitted appeals), that the   Beneficiaries’ are entitled to receive payment of a portion of or all of such   disputed amounts.  All payments under   this Section 10 together with any payment of the Guaranteed Obligations   shall remain subject to the aggregate amount limitations set forth in Section 1.

 

11.       Waiver of   Jury Trial.  The   Guarantor and the Beneficiaries, through acceptance of this Guaranty, waive   all rights to trial by jury in any action, proceeding or counterclaim arising   or relating to this Guaranty.

 

12.       Entire   Agreement; Amendments.    This Guaranty integrates all of the terms and conditions mentioned   herein or incidental hereto and supersedes all oral negotiations and prior   writings in respect to the subject matter hereof.  This Guaranty may only be amended or   modified by an instrument in writing signed by each of the Guarantor and the   Beneficiaries.

 

13.       Headings.  The headings of the various Sections of   this Guaranty are for convenience of reference only and shall not modify,   define or limit any of the terms or provisions hereof.

 

14.       No   Third-Party Beneficiary.    This Guaranty is given by the Guarantor solely for the benefit of the   Beneficiaries, and is not to be relied upon by any other person or entity.

 

15.       Assignment.  Neither the Guarantor nor the Beneficiaries   may assign its rights or obligations under this Guaranty without the prior   written consent of the other, which consent may not be unreasonably withheld   or delayed, except that:

 

(i)             the Guarantor may make   such an assignment without such consent if (a) in conjunction with the   assignment by the Obligor of all of its rights and obligations under either   Agreement and the assignee’s long-term senior unsecured debt has an   investment grade rating by Standard and Poor’s (“S&P”) or Moody’s   Investor Services, Inc. (“Moody’s”), or if the assignee does not   have a long-term senior unsecured debt rating, then the rating assigned to   such entity as its Corporate Credit Rating by S&P or Issuer Rating by   Moody’s shall be investment grade; (b) the Obligor ceases to be a person   or entity controlled by, controlling or under common control with the Guarantor   and the assignee’s long-term senior unsecured debt has an investment grade   rating by S&P or Moody’s, or if the assignee does not have a long-term   senior unsecured debt rating, then the rating assigned to such entity as its   Corporate Credit Rating by S&P or Issuer Rating by Moody’s shall be   investment grade or (c) to an entity whose long-term senior unsecured   debt has an investment grade rating by S&P or Moody’s, or if the assignee   does not have a long-term senior unsecured debt rating, then the rating   assigned to such entity as its Corporate Credit Rating by S&P or Issuer   Rating by Moody’s shall be investment grade; provided that the   Guarantor’s obligations hereunder must be expressly assumed in writing, in a   form reasonably
    	
 
    	
acceptable   to the Beneficiaries; provided further that such assumption shall be   deemed to release the Guarantor from all of its obligations under this   Guaranty automatically and without further action by the Guarantor or the   Beneficiaries, and

 

(ii)          the Beneficiaries may,   upon 30 days prior written notice, make such an assignment without such   consent if in conjunction with any assignment of either Agreement by the   Beneficiaries permitted under the Agreements.

 

Any   purported assignment in violation of this Section 15 shall be void and   without effect.

 

16.       Notices.  Any communication, demand or notice to be   given hereunder will be duly given when delivered in writing or sent by   facsimile to the Guarantor or to the Beneficiaries, as applicable, at its   address as indicated below:

 

If   to the Guarantor, at:

 

Dynegy Inc.

601   Travis Street, Suite 1400

Houston,   Texas 77002

Attention:   Catherine Callaway, Esq. Executive Vice President and General Counsel

Facsimile:   (713) 507-6808

 

With   a copy to:

 

White & Case LLP

1155   Avenue of the Americas

New   York, NY 10036

Attention:   Michael S. Shenberg, Esq.

Facsimile:   (212) 354-8113

 

If   to the Beneficiaries, at:

 

Duke Energy SAM, LLC

Duke Energy Commercial Enterprises, Inc.

c/o Duke Energy Corporation

550 South Tryon Street

DEC 40A

Charlotte, North Carolina 28201

Attention: Assistant Treasurer

Facsimile: (704) 382-1124

 

With   a copy to:

 

Duke Energy Corporation

550   South Tryon Street

DEC   45A

Charlotte,   North Carolina 28202

Attention:   Greer Mendelow, Deputy General Counsel

Facsimile:   (980) 373-9962

 

or such other address as   the Guarantor or the Beneficiaries shall from time to time specify.  Notice shall be deemed given (a) when   received, as evidenced by signed receipt, if sent by hand delivery, overnight   courier or registered mail or (b) when received, as evidenced by   transmission confirmation report, if sent by facsimile and received on or   before 4 pm local time of recipient, or (c) the next business day, as   evidenced by
    


 











 

	
transmission confirmation   report, if sent by facsimile and received after 4 pm local time of recipient.

 

[Signature Page Follows]
    	
 
    	
 
    


 











 

	
IN WITNESS WHEREOF, the Guarantor has executed   this Guaranty as of the day and year first above written.
    	
 
    	
 
    


 

	
DYNEGY INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Robert C. Flexon
    	
 
    
	
Name:
    	
Robert   C. Flexon
    	
 
    
	
Title:
    	
President   and Chief Executive Officer