Document:

Shareholder Agreement dated as of September 14, 2006

 Exhibit 4.1 
  

 SHAREHOLDER AGREEMENT 
 among 
 DYNEGY ACQUISITION, INC. 
 and 
 LS POWER PARTNERS, L.P., 
 LS POWER ASSOCIATES, L.P., 
 LS POWER EQUITY PARTNERS, L.P., 
 LS POWER EQUITY PARTNERS PIE I, L.P. 
 and

 LSP GEN INVESTORS, L.P. 
 Dated
as of September 14, 2006 
  

 TABLE OF CONTENTS 
  

			
	 	  	Page
	ARTICLE I	  	
		
	Definitions	  	
		
	SECTION 1.01. Definitions	  	3
		
	ARTICLE II	  	
		
	Limitations on Acquisitions and Transfers	  	
		
	SECTION 2.01. Limitations on Certain Acquisitions by Shareholders	  	8
	SECTION 2.02. Transfer Restrictions	  	11
	SECTION 2.03. Time Periods	  	13
	SECTION 2.04. Shares Subject to the Agreement	  	13
	SECTION 2.05. References to Class B Shares	  	13
	SECTION 2.06. Legend and Stop Transfer Order	  	13
		
	ARTICLE III	  	
		
	Board of Directors; Major Decisions	  	
		
	SECTION 3.01. Board of Directors	  	14
	SECTION 3.02. Major Decisions	  	14
	SECTION 3.03. Committee Membership	  	14
		
	ARTICLE IV	  	
		
	Certain Agreements Relating to New Dynegy	  	
		
	SECTION 4.01. Sales of Class B Shares	  	15
	SECTION 4.02. Restraints on Shareholders Ownership	  	15
	SECTION 4.03. Board Representation of Shareholders	  	15
		
	ARTICLE V	  	
		
	Preemptive Rights	  	
		
	SECTION 5.01. Employee Benefit Plans; Certain Recapitalization Securities	  	15
	SECTION 5.02. Other Issuances	  	15
	SECTION 5.03. Intended Issuances	  	16
	SECTION 5.04. Purchase Price	  	16
	SECTION 5.05. Proportionate Share	  	16
	SECTION 5.06. Nature of Securities	  	16

			
	 SECTION 5.07. Presumption
	  	17
	 SECTION 5.08. Effectiveness of Preemptive Rights
	  	17
		
	ARTICLE VI	  	
		
	Certain Agreements Relating to the Shareholders and the Shareholder Control Group	  	
		
	 SECTION 6.01. Change of Control
	  	17
	 SECTION 6.02. Shareholder Control Group, Permitted Transferees and LS Holders Schedule
	  	17
	 SECTION 6.03. Ownership of Shares
	  	18
	 SECTION 6.04. Joinder
	  	18
		
	ARTICLE VII	  	
		
	Shareholders Representative	  	
		
	 SECTION 7.01. Authorization of Shareholders Representative
	  	18
	 SECTION 7.02. Compensation; Exculpation; Indemnity
	  	19
	 SECTION 7.03. Removal and Replacement of Shareholders Representative
	  	19
	 SECTION 7.04. Reliance; Limitations
	  	19
		
	ARTICLE VIII	  	
		
	General Provisions	  	
		
	 SECTION 8.01. Effectiveness and Term
	  	20
	 SECTION 8.02. Adjustments for Stock Splits, Etc
	  	20
	 SECTION 8.03. Intent and Interpretation
	  	20
	 SECTION 8.04. Specific Enforcement
	  	21
	 SECTION 8.05. Severability
	  	21
	 SECTION 8.06. Notices, Etc
	  	21
	 SECTION 8.07. Amendments, Waivers, Etc
	  	22
	 SECTION 8.08. Entire Agreement
	  	22
	 SECTION 8.09. Remedies Cumulative
	  	22
	 SECTION 8.10. No Waiver
	  	22
	 SECTION 8.11. No Third Party Beneficiaries
	  	22
	 SECTION 8.12. Consent to Jurisdiction
	  	23
	 SECTION 8.13. Governing Law
	  	23
	 SECTION 8.14. WAIVER OF JURY TRIAL
	  	23
	 SECTION 8.15. Name, Captions, Gender
	  	23
	 SECTION 8.16. Counterparts
	  	23
	 SECTION 8.17. Successors and Assigns
	  	23
	 SECTION 8.18. Luminus
	  	24

 SHAREHOLDER AGREEMENT, dated as of September 14, 2006 (this “Agreement”), among
DYNEGY ACQUISITION, INC., a Delaware corporation (“New Dynegy”), and LS POWER PARTNERS, L.P., LS POWER ASSOCIATES, L.P., LS POWER EQUITY PARTNERS, L.P., LS POWER EQUITY PARTNERS PIE I, L.P. and LSP GEN INVESTORS, L.P. (each, an
“Initial Shareholder” and collectively, the “Initial Shareholders”). 
 WHEREAS, the Initial Shareholders,
New Dynegy and other parties thereto have entered into a Plan of Merger, Contribution and Sale Agreement dated September 14, 2006 (the “Merger Agreement”), pursuant to which New Dynegy agreed, among other things, to acquire
(i) all of the Shareholders’ ownership interests in entities that own certain power generating facilities and (ii) 50% of the ownership interest in an entity that owns certain development projects, each as specified in the Merger
Agreement (the “Acquisition”) in exchange for, among other things, the issuance to the Shareholders of the number of Class B Shares (as defined below) specified in the Merger Agreement. 
 WHEREAS, in connection with the Merger Agreement and the Acquisition, the Shareholders and New Dynegy agreed to enter into this Agreement in order to set
forth certain agreements relating to the ownership by the Shareholders of the Class B Shares. 
 NOW, THEREFORE, in consideration of the
premises and the mutual and independent covenants hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
 ARTICLE I 
 Definitions 
 SECTION 1.01. Definitions. As used in this Agreement, each of the following capitalized terms is defined as follows: 
 “Acquisition” has the meaning specified in the recitals to this Agreement. 
 “Affiliate” means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under
common control with, another Person; provided, however, that for purposes of this Agreement (a) none of New Dynegy or any of its subsidiaries shall be deemed an Affiliate of any Shareholder, (b) none of the Class B Directors
shall be deemed an Affiliate of New Dynegy or any of its subsidiaries and (c) Luminus shall not be deemed an Affiliate of any Shareholder. For purposes of this definition “control” means, as to any Person, the sole power to
direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. The term “controlled” has a correlative meaning. 
 “Agreement” has the meaning specified in the preamble to this Agreement. 
 “Associate”, when used in connection with any Person, means (a) any corporation, partnership, unincorporated association or other
entity of which such Person is a 
  

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 director, officer or partner or is, directly or indirectly, the owner of greater than or equal to 20% of any class of
voting stock, (b) any trust or other estate in which such Person has greater than or equal to 20% of the total beneficial interest, or of which such Person serves as a trustee or in a similar fiduciary capacity, (c) any relative or spouse
of such Person, or any relative of the spouse of such Person, who has the same residence as such Person and (d) any heirs, executors, administrators, testamentary trustees, legatees or beneficiaries of such Person and any trust for the benefit
of the heirs of such Person. Notwithstanding the foregoing, Luminus shall at no time be an Associate of any Shareholder. 
 “Auction” means a sale process for 100% of the total combined voting power of the outstanding voting securities of New Dynegy conducted by an investment banking firm of national reputation selected by New Dynegy and
reasonably acceptable to the Shareholders Representative. Without limiting the generality of the foregoing, an Auction may include either (a) a broad or narrow solicitation of interest and may or may not involve multiple rounds of bidding as
determined by the Board or a committee thereof and/or (b) any recapitalization, combination, reverse merger or other similar transaction. 
 “Beneficially Own” has the meaning referred to in Rule 13d-3 of the Exchange Act as in effect on the date hereof. 
 “Board” means the board of directors of New Dynegy. 
 “Change of Control” means the LS Holders
ceasing to have direct or indirect control over holders of a majority of the Class B Shares then outstanding. For purposes of this definition “control” means, as to any Person, the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. 
 “Class A
Director” means any Director that is not a Class B Director. 
 “Class A Shares” means shares of New Dynegy’s
Class A Common Stock, par value $0.01. 
 “Class B Director” means any Director elected by a class vote of holders of
the Class B Shares pursuant to New Dynegy’s Certificate of Incorporation. 
 “Class B Shares” means shares of New
Dynegy’s Class B Common Stock, par value $0.01. 
 “Closing Date” has the meaning assigned thereto in the Merger
Agreement. 
 “Common Stock” means Class A Shares, Class B Shares and/or any other class of common stock of New Dynegy
that may be issued after the Closing Date. 
 “Controlled Affiliate” means, as to any Person (the “Controlling
Person”), (a) any Affiliate that is consolidated with the financial statements of such Controlling Person, (b) any Affiliate in which the Controlling Person holds greater than or equal to 50% of the total combined voting power of
its outstanding voting securities and (c) with respect to any specific 
  

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 matter, any Affiliate over which the Controlling Person has the power (by contract or otherwise) to prevent such entity
from pursuing such matter (except that, for purposes of Section 3.02, the Controlled Affiliates of New Dynegy shall not include any such Person over which the Shareholder Control Group also has the power (by contract or otherwise) to prevent
such entity from pursuing such matter). 
 “direct ownership” means ownership by an owner but excluding any such ownership
with or through Associates and Affiliates of such owner. The terms “directly own” and “directly owned” have correlative meanings. 
 “Director” means a member of the Board. 
 “Distribution” has the meaning
specified in Section 2.02(b). 
 “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 “Governmental Authority” means any governmental or regulatory authority or agency. 
 “Group” has the meaning specified in Section 13(d)(3) of the Exchange Act as in effect on the date hereof. 
 “Initial Shareholder” and “Initial Shareholders” have the meanings specified in the preamble to this Agreement.

 “Lock-Up Period” means the period from the Closing Date to the earliest of (a) the second anniversary of the Closing
Date, (b) the date the Shareholders cease to collectively own Class B Shares representing greater than or equal to 15% of the total combined voting power of New Dynegy’s outstanding voting securities and (c) the occurrence of a Third
Party Offer Termination Event. 
 “LS Holders” means (a) Persons holding equity interests in LS Power Development, LLC
as of the date hereof (the “Initial Persons”), (b) any Controlled Affiliate of any such Initial Person, (c) any relative or spouse of any such Initial Person or any relative of the spouse of any such Initial Person, in
each case having the same residence as such Initial Person and (d) any heirs, executors, administrators, testamentary trustees, legatees or beneficiaries of any such Initial Person and any trust for the benefit of the heirs of any such Initial
Person, and, upon the death or disability of such Initial Person, any Controlled Affiliate of any such heirs, executors, administrators, testamentary trustees, legatees or beneficiaries. 
 “LS Standstill Cap” means the percentage of New Dynegy’s total outstanding Common Stock determined by dividing (a) 340,000,000
with (b) the total number of Class A Shares and Class B Shares outstanding as of the Effective Time (as defined in the Merger Agreement); provided, however, that such percentage shall be permanently reduced following any sale
of Class B Shares that is not a Widely Dispersed Sale by a number equal to the percentage of New Dynegy’s total outstanding Common Stock that the applicable Person acquires in such sale in excess of the percentages that would have made such
sale a Widely Dispersed Sale as set forth in the definition thereof. For purposes of the foregoing proviso, Transfers to Permitted Transferees and Distributions shall be deemed Widely Dispersed Sales. 
  

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 “Luminus” means, collectively, Luminus Management, LLC, its Controlled Affiliates and
any of the assets or funds that they manage. 
 “Merger Agreement” has the meaning specified in the recitals to this
Agreement. 
 “New Dynegy” has the meaning specified in the preamble to this Agreement. 
 “owner”, with respect to any stock or other equity interest, means a Person that individually or with or through any of its Affiliates
or Associates: 
 (a) owns beneficially such stock or equity interest, whether directly or indirectly; 
 (b) has (i) the right to acquire such stock or equity interest (whether such right is exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding, or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise; provided, however, that for purposes of this clause (b)(i) a Person shall be deemed
the owner of stock or other equity interest tendered by other parties pursuant to a tender or exchange offer made by such Person or any of such Person’s Affiliates or Associates only when such tendered stock or equity interest is accepted for
purchase or exchange by such Person or such Affiliate or Associate of such Person; or (ii) the right to vote such stock or equity interest pursuant to any agreement, arrangement or understanding; provided, however, that for
purposes of this clause (b)(ii) a Person shall not be deemed the owner of any stock or equity interest if the agreement, arrangement or understanding to vote such stock or equity interest arises solely from a revocable proxy or consent given in
response to a proxy or consent solicitation made to 10 or more Persons; or 
 (c) has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting (except as pursuant to a revocable proxy or consent as described in clause (b)(ii) above), or disposing of such stock or equity interest with any other Person that owns beneficially, or whose Affiliates or
Associates own beneficially, directly or indirectly, such stock or equity interest. 
 The terms “own” and
“owned” have correlative meanings. 
 “Permitted Transferee” means any Initial Shareholder and (a) any
Affiliate (on the date hereof) of any Initial Shareholder and (b) any director, officer or employee (with a title of “manager” or higher) of any Shareholder or of any Affiliate (on the date hereof) of any Shareholder. Notwithstanding
the foregoing, at no time shall Luminus be deemed a Permitted Transferee. 
 “Person” means a natural person, a corporation,
a limited liability company, a partnership, an association, a trust or any other entity or organization, including a Governmental Authority. 
  

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 “Public Sale” means (a) an underwritten public offering of Class B Shares (or other
securities of New Dynegy into which such Class B Shares may convert) pursuant to an effective registration statement under the Securities Act or (b) a bona fide public sale of Class B Shares (or other securities of New Dynegy into which such
Class B Shares may convert) in an open market transaction through a broker, dealer or market maker under Rule 144 (or any successor rule thereto) of the Securities Act. 
 “Qualified Offer” means a written offer to New Dynegy, by the Shareholders Representative on behalf of the Shareholders, to acquire all, but not less than all, the outstanding voting securities of New
Dynegy for consideration consisting solely of cash or freely tradable securities listed on a national securities exchange or the Nasdaq Stock Market (or successors thereto), which offer is accompanied by a fairness opinion relating to such offer
from an investment banking firm of national reputation. 
 “SEC” means the Securities and Exchange Commission or any
successor organization. 
 “Securities Act” means the Securities Act of 1933, as amended. 
 “Shareholder” means each Initial Shareholder and (a) each Shareholder Control Group member that becomes party to this Agreement
pursuant to Section 6.04 and (b) each Permitted Transferee that becomes party to this Agreement pursuant to Section 8.17. 
 “Shareholder Control Group” means, at any time, (a) any Person, combination of Persons or Group that owns Class B Shares representing greater than or equal to 10% of New Dynegy’s total outstanding Common Stock at
such time, together with all of the Affiliates and Associates of such Person or of any member of any such combination or Group, and (b) any Permitted Transferee; provided, however, that notwithstanding the foregoing, Luminus shall
at no time be a member of the Shareholder Control Group. 
 “Shareholders Representative” has the meaning specified in
Section 7.01(a). 
 “Significant Transaction” means any sale, merger, share exchange, acquisition (including by way of
tender offer or exchange offer), consolidation, dissolution, recapitalization or other business combination involving New Dynegy or any of its subsidiaries pursuant to which more than 25% of the voting securities of New Dynegy or more than 25% of
the consolidated total assets of New Dynegy would be acquired or received by any Person (other than New Dynegy or its subsidiaries). 
 “Third Party Offer Termination Event” means (a) the Board recommends (over the objection of all Class B Directors present at the meeting during which such Significant Transaction is being voted on) a Significant
Transaction by, or a Significant Transaction is consummated with, a Person other than a member of the Shareholder Control Group, Luminus or any Person acting on behalf of or in concert with any member of the Shareholder Control Group or Luminus, or
(b) a Person (other than a member of the Shareholder Control Group, acting in compliance with this Agreement) makes a bona fide public offer to enter into a Significant Transaction and (i) such offer is recommended by the Board over the
objection of all Class B Directors present at the meeting during which such offer is being voted on, (ii) such offer is not 
  

 7 

 rejected by the Board within 10 business days of public disclosure thereof or (iii) such Person commences a tender
offer for more than 25% of the voting securities of New Dynegy, where (A) the Shareholders Representative, on behalf of the Shareholders, has publicly stated that no Class B Shares will be tendered in connection with such tender offer,
(B) such offer is not conditioned upon an event or state of facts within the control of the Shareholder Control Group or Luminus and (C) such offer has not been terminated or withdrawn within 15 business days of commencement. 

“Total Standstill Cap” means LS Standstill Cap plus 1%. 
 “Transfer” means (a) when used as a noun, any direct or indirect transfer, sale, assignment, conveyance, pledge, hypothecation,
encumbrance or other disposition; and (b) when used as a verb, to directly or indirectly transfer, sell, assign, convey, pledge, hypothecate, encumber or otherwise dispose of. The term “Transferable” and
“Transferee” have correlative meanings. 
 “Widely Dispersed Sale” means (a) any Transfer of Common
Stock (i) in which no Person, together with its Affiliates, acquires Class B Shares representing greater than 3% of New Dynegy’s total outstanding Common Stock at such time and (ii) immediately following which no Person, together with
its Affiliates, would Beneficially Own more than 5% of New Dynegy’s total outstanding Common Stock after giving effect to such Transfer (in the case of a Transfer made through the New York Stock Exchange, as determined by reference to the
relevant Schedule 13D and/or 13G filings publicly available with the SEC as of the date of such Transfer), or (b) any Public Sale. 
 ARTICLE II 
 Limitations on Acquisitions and Transfers 
 SECTION 2.01. Limitations on Certain Acquisitions by Shareholders. (a) Except as otherwise expressly provided for in this Section 2.01 or
Article V, the Shareholders shall not, shall cause Luminus to not, and shall use their reasonable best efforts to cause the members of the Shareholder Control Group to not, acquire by purchase or otherwise, or solicit the acquisition of, any equity
securities of New Dynegy, without the prior consent of the Board; provided, however, that (i) a member of the Shareholder Control Group may acquire equity securities of New Dynegy if, after giving effect to such acquisition,
(A) members of the Shareholder Control Group do not collectively own Common Stock (excluding Common Stock received by members of the Shareholder Control Group pursuant to director or employee compensation plans) representing greater than the LS
Standstill Cap and (B) members of the Shareholder Control Group, together with Luminus, do not collectively own Common Stock (excluding Common Stock received by members of the Shareholder Control Group pursuant to director or employee
compensation plans) representing greater than the Total Standstill Cap and (ii) subject to the provisions of clause (i) above, (A) at any time when members of the Shareholder Control Group collectively own Class B Shares (excluding
Class B Shares received by members of the Shareholder Control Group pursuant to director or employee compensation plans) representing greater than or equal to 30% of New Dynegy’s outstanding Common Stock, Luminus may acquire equity securities
of New Dynegy if, after giving effect to such 
  

 8 

 acquisition, Luminus does not own Common Stock of New Dynegy that represents in the aggregate more than 1% of New
Dynegy’s total outstanding Common Stock at such time and (B) at any time when members of the Shareholder Control Group collectively own Class B Shares (excluding Class B Shares received by members of the Shareholder Control Group pursuant
to director or employee compensation plans) representing less than 30%, but greater than or equal to 10%, of New Dynegy’s total outstanding Common Stock, Luminus may acquire equity securities of New Dynegy if, after giving effect to such
acquisition, Luminus does not own Common Stock of New Dynegy that represents in the aggregate more than 5% of New Dynegy’s outstanding Common Stock at such time. 
 (b) (i) Following the expiration of the Lock-Up Period, the Shareholders Representative, on behalf of the Shareholders, shall have the right to make one or more Qualified Offers in accordance with the terms of
this Agreement. In connection with a Qualified Offer, New Dynegy shall accept or reject such Qualified Offer in writing as promptly as practicable after receipt thereof. If New Dynegy does not accept such Qualified Offer in writing within 30 days
after receipt thereof, such Qualified Offer shall be deemed rejected. If a Qualified Offer is rejected, New Dynegy shall, upon the request of the Shareholders Representative, on behalf of the Shareholders, made within five business days following
such rejection, (A) conduct an Auction in which the Shareholders may participate, but shall have no special priority or other rights vis-à-vis other bidders, (B) conduct an Auction in which no member of the Shareholder Control Group
or Luminus or the Controlled Affiliates of any such Person may participate, but at the successful conclusion of which the Shareholders shall have the right to acquire all, but not less than all, the outstanding voting securities of New Dynegy at a
cash purchase price per share equal to 105% of the purchase price per share set forth in the bid selected by the Board, or (C) continue in its ordinary course of business without giving effect to the rejected Qualified Offer. Any Auction
conducted pursuant to this Section 2.01(b) shall be completed within 120 days after New Dynegy receives the relevant Qualified Offer, and the corresponding sale shall close within 60 days after the completion of such Auction. 
 (ii) New Dynegy shall immediately notify the Shareholders Representative in writing, upon the conclusion of an Auction conducted pursuant to
Section 2.01(b)(i)(B), which notice shall include the identity of the winning bidder and the purchase price per share set forth in the winning bid. If the Shareholders Representative, on behalf of the Shareholders, elects to acquire all, but
not less than all, the outstanding voting securities of New Dynegy following the successful conclusion of an Auction conducted pursuant to Section 2.01(b)(i)(B), the Shareholders Representative shall deliver a written notice of such election
for such acquisition to New Dynegy within 10 days of the conclusion of the relevant Auction. The Board shall promptly approve such acquisition by the Shareholders and, within 10 days of the date of the written notice from the Shareholders
Representative, New Dynegy shall execute and enter into a definitive agreement with the Shareholders with respect to such acquisition. Such definitive agreement shall include customary terms and conditions, including (A) a termination fee
payable upon termination of such definitive agreement (or customary “tail” provision) equal to 5% of the aggregate value of New Dynegy, based on the per share value payable by the Shareholders under such agreement multiplied by the number
of shares of Common Stock outstanding at such time and (B) the right of New Dynegy to terminate the transaction and pay such termination fee to the Shareholders if the Board determines that it is necessary for New Dynegy to terminate the
transaction in order for the Board to properly discharge its fiduciary duties. Failure to deliver the 
  

 9 

 notice referred to in the second sentence of this clause (ii) shall be deemed to be an election by the Shareholder
Representative, on behalf of the Shareholders, to not acquire all, and not less than all, the outstanding voting securities of New Dynegy. 
 (iii) If the Shareholders are not the winning bidder in an Auction conducted pursuant to Section 2.01(b)(i)(A) and that is successfully concluded, or do not provide notice of their election to purchase all, but not less than all, the
outstanding voting securities of New Dynegy at the successful conclusion of an Auction conducted pursuant to Section 2.01(b)(i)(B), the Shareholders agree that, except as set forth in Section 2.01(b)(v), they shall vote their Class B
Shares in favor of the successful bidder’s transaction and not exercise dissenter’s rights, shall tender their shares (in the event of a tender offer), and shall otherwise reasonably cooperate in consummating the transaction. 

(iv) If the Shareholders Representative, on behalf of the Shareholders, elects to proceed with an Auction under Section 2.01(b)(i)(A) or
2.01(b)(i)(B), and the Auction is not successfully concluded within 120 days after New Dynegy receives the relevant Qualified Offer, the Shareholders may either (A) proceed with their Qualified Offer (which may take the form of a tender offer
or exchange offer) and close such transaction within 60 days thereafter or (B) reinitiate the Auction process by submitting a new Qualified Offer. 
 (v) If (A) following the successful conclusion of an Auction the corresponding sale does not close within 60 days thereafter, (B) New Dynegy fails to enter into a definitive agreement with the Shareholders
for the acquisition of all the outstanding voting securities of New Dynegy in accordance with Section 2.01(b)(ii), or (C) New Dynegy terminates any definitive agreement entered into with the Shareholders pursuant to
Section 2.01(b)(ii) as a result of a Board determination that it is necessary for New Dynegy to terminate the transaction in order for the Board to properly discharge its fiduciary duties, the Shareholders shall have no obligation to vote in
favor of any other transaction or tender their shares to any other third party, and may, in their discretion, proceed with a tender or exchange offer for all, but not less than all, the outstanding voting securities of New Dynegy not directly owned
by the Shareholders, at such price as the Shareholders shall choose irrespective of any other provisions of this Agreement. The Shareholders shall in addition be free to pursue any other rights and remedies which they may then have against New
Dynegy. 
 (vi) New Dynegy and each of the Shareholders agree that the purchase price set forth in any Qualified Offer is highly confidential
and, as such, New Dynegy and each of the Shareholders shall not (and New Dynegy shall cause each of New Dynegy’s Controlled Affiliates to not, and the Shareholders shall cause each member of the Shareholder Control Group and its Controlled
Affiliates and Luminus to not), to the extent legally permissible, disclose such purchase price to any Person without the prior written consent of the other parties. 
 (vii) To the extent that a successful bidder in an Auction proposes a purchase price that is not solely for cash, the stock component of such bid shall not be greater in value (on a per share basis at the time of
execution) than the cash component of such bid, and the bid shall provide for sufficient cash (or be on such other terms) such that the Shareholders shall have the right and the ability to receive solely cash for their Class B Shares. In such a
case, if the Shareholders elect to acquire all, but not less than all, the outstanding voting securities of New Dynegy following such Auction, the purchase price per share set forth in the successful bid shall be the average value per share at the
time of execution in such bid. 
  

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 (viii) For purposes of this Section 2.01(b), an Auction shall be deemed not to have been
successfully concluded unless the bid selected by the Board, other than a bid by the Shareholders, is for all the outstanding voting securities of New Dynegy or all or substantially all of New Dynegy’s assets. 
 (ix) To the extent that the Shareholders elect under this Section 2.01(b) to acquire all, but not less than all, the outstanding voting securities
of New Dynegy not directly owned by the Shareholders through a tender offer, the Shareholders agree to not complete such tender offer unless and until holders of a majority of the Class A Shares then outstanding have tendered their Class A
Shares to the Shareholders pursuant to the terms of such tender offer. 
 (x) If, during any 18-month period, the Class B Directors, pursuant
to their rights under Article III, Section 7(B)(b)(1) and (2) of New Dynegy’s Bylaws, vote in such a way on at least two separate occasions (each with a different counterparty and pursuant to different terms) that it prevents the
sale, merger or consolidation of New Dynegy or the sale of all or substantially all of New Dynegy’s assets, and within 45 days after the second such vote the majority of the Class A Directors elect to pursue a sale, merger or consolidation
of New Dynegy or the sale of all or substantially all of New Dynegy’s assets that is distinct from (with a different counterparty and pursuant to different terms than) such transactions prevented by the Class B Directors: 
 (A) the Shareholders shall be deemed to have made a Qualified Offer, with such Qualified Offer being deemed rejected by New Dynegy and the
Shareholders being deemed to have collectively elected for New Dynegy to conduct an Auction in accordance with Section 2.01(b)(i)(A) or, if the Shareholders Representative elects, Section 2.01(b)(i)(B) (except that the Shareholders shall
not be entitled to the rights granted them under Section 2.01(b)(iv)); and 
 (B) the Class B Directors shall not be
entitled to their rights under Article III, Section 7(B) of New Dynegy’s Bylaws with respect to any transaction resulting from such Auction other than as members of the whole Board. 
 SECTION 2.02. Transfer Restrictions. Until the expiration of the Lock-Up Period, the Shareholders shall not Transfer any Class B Shares except in
a transaction pursuant to Article II or any rule, regulation, order, writ or decree of any Governmental Authority; provided, however, that: 
 (a) During the period beginning from the date that is 180 days after the Closing Date to the date that is 360 days after the Closing Date, 21,250,000 Class B Shares shall become Transferable by the Shareholders
pursuant to one or more Widely Dispersed Sales, with an additional 21,250,000 Class B Shares becoming Transferable by the Shareholders pursuant to one or more Widely Dispersed Sales on and after the first day of each succeeding 180-day period
thereafter; provided, however, that if the Shareholders Transfer collectively fewer than the amount of Class B Shares permitted to be Transferred during any such 180-day period pursuant 
  

 11 

 to this Section 2.02(a), an unused amount of up to 21,250,000 Class B Shares may be carried over to the next
succeeding 180-day period. For the avoidance of doubt, in no event may the Shareholders Transfer more than 42,500,000 Class B Shares during any such 180-day period. In connection with the foregoing, if any Shareholder Transfers any Class B Shares
under this Section 2.02(a) pursuant to a Widely Dispersed Sale that is not a Public Sale, such Shareholder shall obtain in the relevant purchase agreement a representation from each Transferee of such Class B Shares that (i) such
Transferee shall not have acquired pursuant to such Transfer Class B Shares representing greater than 3% of New Dynegy’s total outstanding Common Stock at such time and (ii) immediately following such Transfer, such Transferee, together
with its Affiliates, would not Beneficially Own more than 5% of New Dynegy’s total outstanding Common Stock after giving effect to such Transfer. 
 (b) Notwithstanding any other provisions of this Agreement, (i) each Shareholder may tender all or a part of the Class B Shares directly owned by it to a third party at any time pursuant to a tender offer of
Common Stock of New Dynegy approved by the Board and (ii) each Shareholder (A) on and after the Closing Date may Transfer all or a part of the Class B Shares directly owned by it to any Permitted Transferee (provided that such Transfer
shall only be valid if the Permitted Transferee complies with Section 8.17) and (B) on and after the date that is 180 days after the Closing Date may, in a transaction or series of related transactions, distribute all or a part of the
Class B Shares or other New Dynegy securities directly owned by it to any of its direct or indirect owners (such distribution by a Shareholder being referred to herein as a “Distribution”); provided, however, that in
the case of this clause (B) the Shareholder making such Distribution shall notify New Dynegy, no later than five business days prior to the date of such Distribution, that it intends to make such Distribution. Upon receipt of the notice from
such Shareholder, New Dynegy may, by notifying such Shareholder prior to such Distribution, block such Distribution by such Shareholder for a period of up to 60 days in connection with any proposed underwritten public offering by New Dynegy of its
securities; provided, however, that New Dynegy may exercise the foregoing blocking right with respect to all Distributions no more than once during any calendar year. No Class B Shares may be Transferred to a member of the Shareholder
Control Group or Permitted Transferee pursuant to a Distribution unless such Transferee executes a joinder as contemplated by Section 6.04 or Section 8.17, respectively. 
 (c) Following the expiration of the Lock-Up Period, members of the Shareholder Control Group may freely Transfer their Class B Shares in accordance
with law, except that the Shareholders shall not, without the prior consent of the Board, Transfer any Class B Shares to any Person (other than as contemplated under Section 2.02(b)) if, after giving effect to such Transfer, such Person and its
Affiliates would collectively own 15% or more of New Dynegy’s total outstanding Common Stock at such time (in the case of a Transfer made through the New York Stock Exchange, as determined by reference to the relevant Schedule 13D and/or 13G
filings publicly available with the SEC as of the date of such Transfer). 
 (d) Upon any Transfer or Distribution of Class B Shares to any
Person that is not a member of the Shareholder Control Group, such Transferee’s Class B Shares shall automatically be converted into Class A Shares pursuant to provisions set forth in New Dynegy’s Certificate of Incorporation. This
Agreement shall not affect the Transferability of any Class A Shares. 
  

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 (e) The Shareholders Representative shall notify New Dynegy, no later than 60 days prior to the date
thereof, of any Transfer that will result in New Dynegy ceasing to be a “Designated Affiliate” as defined in and under (i) the First Lien Credit Agreement dated as of May 4, 2006 (the “First Lien Credit
Agreement”), among LSP GEN Finance Co, LLC, as Borrower, the Guarantors named therein, the Initial Lenders, Initial Issuing Bank and Initial Swing Line Bank named therein and Credit Suisse, as Administrative Agent and First Lien Collateral
Agent or (ii) the Second Lien Credit Agreement dated as of May 4, 2006 (together with the First Lien Credit Agreement, the “Credit Agreements”), among LSP GEN Finance Co, LLC, as Borrower, the Guarantors named therein, the
Initial Lenders named therein and Credit Suisse, as Administrative Agent and Second Lien Collateral Agent. The obligations of the Shareholders Representative under this Section 2.02(e) shall terminate upon New Dynegy becoming a “Permitted
Holder” as defined in and under each of the Credit Agreements. 
 SECTION 2.03. Time Periods. Whenever a provision of Article II
or Article III provides that an action is to be taken within a specified period of time, such period shall be increased to the extent reasonable to accommodate obtaining any required approvals from any Governmental Authorities. 
 SECTION 2.04. Shares Subject to the Agreement. Except as otherwise provided for herein, all Class B Shares now or hereafter owned by a Shareholder
or member of the Shareholder Control Group shall be subject to the terms of this Agreement. 
 SECTION 2.05. References to Class B
Shares. With respect to any Transfer, a reference to Class B Shares herein shall be deemed to include the Class A Shares or other securities issuable upon conversion of the Class B Shares in accordance with New Dynegy’s Certificate of
Incorporation. 
 SECTION 2.06. Legend and Stop Transfer Order. To assist in effectuating the provisions of this Agreement, the
Shareholders hereby consent: 
 (a)to the placement of the following legend on all certificates certifying ownership of the Class B Shares
until such Class B Shares have been sold, transferred or disposed of pursuant to the requirements of Article II hereof: 
 “THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES OR BLUE SKY LAWS. THESE SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT OR APPLICABLE STATE SECURITIES OR BLUE SKY LAWS. Additionally, the securities represented by this certificate are subject to the provisions of a Shareholder Agreement dated as of
September 14, 2006 by and among Dynegy Acquisition, Inc. and the shareholders party thereto and may not be sold, transferred, pledged, hypothecated or otherwise disposed of except in accordance therewith. A copy of said agreement is on file at
the office of the Secretary of Dynegy Acquisition, Inc.”; and 
  

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 (b)to the entry of a stop transfer order with the transfer agent or agents of New Dynegy securities
against the transfer of Class B Shares except in compliance with the requirements of this Agreement, or, if New Dynegy is its own transfer agent with respect to any Class B Shares, to the refusal by New Dynegy to transfer any such securities except
in compliance with the requirements of this Agreement. 
 ARTICLE III 
 Board of Directors; Major Decisions 
 SECTION 3.01. Board of Directors.
Immediately after the Closing (as defined in the Merger Agreement) the Board shall consist of 11 Directors, three of which shall have been nominated by the Shareholders and eight of which shall have been members of the board of directors of Dynegy
Inc., an Illinois corporation, immediately prior to the Closing Date. At any time after the Closing Date the composition of the Board and the election of Directors shall be in accordance with New Dynegy’s Certificate of Incorporation.

 SECTION 3.02. Major Decisions. At any time when the Shareholders collectively directly own Class B Shares representing greater
than or equal to 15% of the total combined voting power of New Dynegy’s outstanding voting securities, New Dynegy shall not, and shall not permit any of its subsidiaries or Controlled Affiliates to, and no officer, employee or agent of New
Dynegy or any subsidiary or Controlled Affiliate thereof shall, take any “Major Decision”, as defined in Article III, Section 7(B) of New Dynegy’s Bylaws, if all of the Class B Directors present at the meeting where such Major
Decision is considered vote against such Major Decision. For informational purposes only, a copy of Article III, Section 7(B) of New Dynegy’s Bylaws is included in Schedule I hereto. 
 SECTION 3.03. Committee Membership. Subject to applicable law, at any time when holders of Class B Shares have the right to elect Class B
Directors pursuant to New Dynegy’s Certificate of Incorporation, at least one of the members of each committee of the Board (other than any committee the mandate of which is limited solely to (i) considerations of matters relating to New
Dynegy’s relationship with the Shareholders and their Affiliates or (ii) nominations of candidates for Class A Directors) shall be a Class B Director, provided, however, that the requirement of this Section 3.03
shall not apply with respect to a committee of the Board at any time (a) when none of the Class B Directors satisfies the independence requirements of the New York Stock Exchange and/or the SEC, as applicable, for eligibility to serve as a
member of such committee of the Board, (b) when all Class B Directors decline to serve on such committee or (c) when the Shareholders decline to elect any Class B Director. 
  

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 ARTICLE IV 
 Certain Agreements Relating to New Dynegy 
 SECTION 4.01. Sales of Class B Shares. New Dynegy
shall not issue or agree to issue to any Person other than the Shareholders any Class B Shares (or any security convertible or exchangeable into such Class B Shares or any option, warrant or other right to acquire such Class B Shares) without the
prior written consent of the Shareholders Representative. 
 SECTION 4.02. Restraints on Shareholders Ownership. New Dynegy shall not
adopt a shareholder rights plan, “poison pill” or similar device that prevents the Shareholders from exercising their rights under this Agreement, New Dynegy’s Certificate of Incorporation or New Dynegy’s Bylaws. 
 SECTION 4.03. Board Representation of Shareholders. Other than with respect to Class B Directors, the Shareholders shall not, and shall cause
members of the Shareholder Control Group and Luminus to not, directly or indirectly, place representatives on New Dynegy’s Board or seek the removal of any Director, except in accordance with their rights as holders of the Class B Shares as set
forth in New Dynegy’s Certificate of Incorporation. 
 ARTICLE V 
 Preemptive Rights 
 SECTION 5.01. Employee Benefit Plans; Certain
Recapitalization Securities. (a) If New Dynegy issues any Common Stock or other equity securities pursuant to stock option, restricted stock or other employee benefit plans, within 30 days following the end of each fiscal quarter New Dynegy
shall notify the Shareholders Representative in writing of all such issuances. Within 30 days after the receipt of such notification, the Shareholders Representatives, on behalf of the Shareholders, may notify New Dynegy of the Shareholders’
intent to purchase their “proportionate share” or less of such Common Stock or such other equity securities, in which event New Dynegy shall issue such Common Stock or such other equity securities to the Shareholders in exchange for the
purchase price. 
 (b) Notwithstanding the foregoing, if New Dynegy is subject to a stock split or reverse split, or declares dividends or
makes other distributions in the form of securities and/or other properties, the Shareholders shall receive the kind and amount of securities and/or other properties they are entitled to receive upon such transaction as a holder of equity securities
of New Dynegy (including, but not limited to, securities and/or other properties that they would have been entitled to receive had they converted their Class B Shares into Class A Shares immediately prior to such transaction). In no event shall
the Shareholders’ proportionate interest in the equity securities of New Dynegy be affected by any such transaction. 
 SECTION 5.02.
Other Issuances. If New Dynegy issues any equity securities other than as described in Section 5.01, promptly, but in all events within 30 days following each such issuance, New Dynegy shall notify the Shareholders Representative in
writing of 
  

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 such issuance. Within 30 days after the receipt of such notification, the Shareholders Representative, on behalf of the
Shareholders, may notify New Dynegy in writing of the Shareholders’ intent to purchase their proportionate share or less of such equity securities, in which event New Dynegy shall issue such equity securities to the Shareholders in exchange for
the purchase price. 
 SECTION 5.03. Intended Issuances. Notwithstanding the provisions of Section 5.02, to enable New Dynegy to
efficiently structure financings and other securities issuances, if New Dynegy notifies the Shareholders Representative in writing of the material terms of an intended issuance of any equity securities, as promptly as practicable thereafter the
Shareholders Representative, on behalf of the Shareholders, shall notify New Dynegy in writing of the Shareholders’ election to purchase their proportionate share or less of such equity securities, in which case New Dynegy shall issue such
equity securities to the Shareholders in exchange for the purchase price at the time of the issuance to others. If the material terms of the intended issuance change prior to issuance, New Dynegy shall promptly give the Shareholders Representative
written notice thereof, and as promptly as practicable thereafter the Shareholders Representative, on behalf of the Shareholders, shall reconfirm (or reverse) the prior election of the Shareholders in writing. 
 SECTION 5.04. Purchase Price. The purchase price for Common Stock or such other equity securities issued pursuant to Section 5.01 or 5.02
shall equal: (a) if the securities are issued in an arms’ length transaction based upon the market price of New Dynegy’s securities, at the price of such issuance less any issuance discount or underwriting or similar fees, (b) if
clause (a) does not apply, at the mean closing price on the New York Stock Exchange (or other primary market for the relevant securities) over the 20 trading days most immediately preceding the issuance, (c) if neither clause
(a) or (b) applies, at the fair market value thereof as determined for purposes of complying with the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, if a notification is required pursuant to such Act, and
(d) otherwise at the fair market value thereof, in cash, as determined in good faith by the Board. 
 SECTION 5.05. Proportionate
Share. For purposes of the issuance of securities to the Shareholders pursuant to this Article V, a Shareholder’s “proportionate share” shall be that number of shares of Common Stock or other equity securities that preserves such
Shareholder’s proportionate interest in the Common Stock of New Dynegy on a fully-diluted basis (in the case of Common Stock or other equity securities that are convertible into, exercisable for or exchangeable for Common Stock) or in the
relevant class of equity securities (in the case of equity securities that are not convertible into, exercisable for or exchangeable for Common Stock) at the same level as prior to the issuance that triggered such Shareholder’s rights. If, in
connection with an issuance of securities, a Shareholder does not purchase all securities available to be purchased by such Shareholder as a result of the grant of the preemptive rights under this Article V, such Shareholder shall be deemed to have
forfeited its rights to purchase the securities in connection with such issuance. 
 SECTION 5.06. Nature of Securities. (a) To
the extent that the Shareholders are entitled to purchase or receive Class A Shares pursuant to this Article V or Section 2.01, such Class A Shares shall instead be issued as Class B Shares to the Shareholders on a one-for-one basis.

  

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 (b) To the extent that the Shareholders are entitled to purchase or receive any other voting securities
pursuant to this Article V or Section 2.01, New Dynegy and the Shareholders shall negotiate in good faith and agree upon the nature of the securities and, if applicable, the restrictions on or privileges of, such securities so that the purposes
of this Agreement are effected. 
 (c) The Shareholders shall have no preemptive rights with respect to securities that do not, and do not
convert into other securities that may, participate in the earnings of New Dynegy or, absent a payment or other default, in the election of Directors. 
 SECTION 5.07. Presumption. To facilitate future reviews of the books and records of New Dynegy, there shall be an irrefutable presumption that this Article V has been fully complied with by New Dynegy:
(a) with respect to all issuances during any fiscal year, absent a filing by a Shareholder with the SEC (for instance, on a Schedule 13D) within 180 days following the end of such fiscal year of a document stating its belief that it was not
issued the securities that it was entitled to during such fiscal year, and (b) with respect to all issuances, absent the institution of litigation against New Dynegy by a Shareholder prior thereto, 180 days following the last date on which
there have been any Class B Shares outstanding. 
 SECTION 5.08. Effectiveness of Preemptive Rights. New Dynegy shall use its best
efforts to cause the rights of the Shareholders under this Article V to remain effective under the applicable rules and regulations of any national securities exchange on which any securities of New Dynegy are listed. Such best efforts shall include
(i) submitting the provisions of this Article V for reapproval by holders of New Dynegy’s voting securities as necessary and (ii) retaining a proxy solicitation firm to solicit proxies in favor of such approving such matter.

 ARTICLE VI 
 Certain
Agreements Relating to 
 the Shareholders and the 
 Shareholder Control Group 
 SECTION 6.01. Change of Control. Upon the occurrence of a Change
of Control, the provisions of Section 2.01(b), Section 3.02 and Article V shall cease to be in effect; provided, however, that the foregoing shall in no way affect the rights of holders of Class B Shares under New
Dynegy’s Certificate of Incorporation. 
 SECTION 6.02. Shareholder Control Group, Permitted Transferees and LS Holders Schedule.
The Shareholders have provided New Dynegy, as of the date hereof, an accurate and complete list of all members of the Shareholder Control Group, all Permitted Transferees and all Persons holding equity interests in LS Power Development, LLC. On the
Closing Date, and on June 30 and December 15 of each year, the Shareholders Representative shall submit a true and correct schedule naming all Persons who are members of the Shareholder Control Group or Permitted Transferees on such date;
provided, however, that the Shareholders Representative may update such schedule at any time to reflect the members of the Shareholder Control Group and/or Permitted Transferees as of the time of such update. 
  

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 SECTION 6.03. Ownership of Shares. As of the date hereof, no Initial Shareholder owns, and
immediately prior to the Closing (as defined in the Merger Agreement), no Initial Shareholder shall own, any share of Common Stock or any share of common stock of Dynegy Inc., an Illinois corporation. 
 SECTION 6.04. Joinder. If a member of the Shareholder Control Group becomes a direct owner of any voting securities of New Dynegy, the
Shareholders Representative shall, upon obtaining actual knowledge of such direct ownership, use its reasonable best efforts to cause such Person to execute a joinder agreement to this Agreement and become a Shareholder hereunder. Any Shareholder
obtaining actual knowledge of any member of the Shareholder Control Group acquiring Common Stock shall inform New Dynegy of such fact as soon as practicable. If such member of the Shareholder Control Group does not execute a joinder agreement to
this Agreement and become a Shareholder hereunder, the Class B Shares of such Person shall not be deemed to be outstanding for purposes of Section 3.01, Section 3.02 and Article V. 
 ARTICLE VII 
 Shareholders Representative 
 SECTION 7.01. Authorization of Shareholders Representative. (a) LS Power Development, LLC is hereby appointed, authorized and empowered as
the representative of each Shareholder (in such capacity, the “Shareholders Representative”) to act on behalf of each Shareholder in connection with the enforcement of the rights of, and the performance of the obligations of, the
Shareholders under this Agreement, including: 
 (i) to execute and deliver such amendments, waivers and consents in
connection with this Agreement as the Shareholders Representative, in its reasonable discretion, may deem necessary or desirable to give effect to the provisions of this Agreement; 
 (ii) to enforce (or refrain from enforcing) and protect the Shareholders’ rights and interests arising out of, or under or in any
manner relating to, this Agreement; and 
 (iii) to execute, acknowledge and deliver all such other contracts, agreements,
schedules, orders, receipts, endorsements, notices, requests, instructions, certificates, stock powers, letters and other writings and to perform any and all actions that the Shareholders Representative, in its reasonable discretion, may deem
necessary in connection with or to carry out the activities described in this Section 7.01(a). 
 (b) The Shareholders
Representative’s authority under this Section 7.01 (i) is coupled with an interest and is being granted, in part, as an inducement to the Shareholders and New Dynegy to enter into this Agreement, (ii) shall be irrevocable and
survive the death, incompetence, bankruptcy or liquidation of any Shareholder and shall be binding on any successor thereto and (iii) may be exercised, subject to Section 7.03, by the Shareholders Representative by signing in its capacity
as the Shareholders Representative on behalf of any Shareholder. 
  

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 SECTION 7.02. Compensation; Exculpation; Indemnity. (a) The Shareholders Representative is
not entitled to any fee, commission or other compensation for the performance of its service hereunder. 
 (b) In dealing with this Agreement
and any instruments, agreements or documents relating thereto, and in exercising or failing to exercise all or any of the powers conferred upon the Shareholders Representative hereunder or thereunder, (i) the Shareholders Representative shall
not assume any, and shall not incur any, liability whatsoever to any Shareholder because of any error in judgment or other act or omission performed or omitted hereunder or in connection with this Agreement, including such errors, acts or omissions
attributable to the Shareholders Representative’s own negligence and (ii) the Shareholders Representative shall be entitled to rely on the advice of counsel, public accountants or other independent experts experienced in the matter at
issue, and any error in judgment or other act or omission of the Shareholders Representative pursuant to such advice shall not subject the Shareholders Representative to liability to any Shareholder. 
 SECTION 7.03. Removal and Replacement of Shareholders Representative. (a) If the Shareholders Representative or its successor, heir or
representative, as the case may be, notifies the Shareholders that the Shareholders Representative is unable to perform its duties hereunder, within 10 business days of such notice, the Shareholders holding a majority of the Class B Shares then held
by all Shareholders at such time shall appoint a successor Shareholders Representative. 
 (b)Any Shareholders Representative may be removed
at any time by a written notice from the Shareholders holding a majority of the Class B Shares then held by all Shareholders at such time, which written notice shall be delivered to (i) the Shareholders Representative being replaced,
(ii) all Shareholders and (iii) New Dynegy; provided, however, that such Shareholders Representative shall continue to serve in its capacity as Shareholders Representative until such time that the Shareholders delivering such written
notice of removal appoint a successor Shareholders Representative. 
 (c)If any successor Shareholders Representative is appointed under this
Section 7.03, such appointment shall be effective upon delivery of written notice thereof executed by the applicable Shareholders to each of (i) the Shareholders Representative being replaced, (ii) all Shareholders and (iii) New
Dynegy. Any successor Shareholders Representative shall have all of the authorities and responsibilities conferred upon, or delegated to, a Shareholders Representative pursuant to this Agreement. 
 SECTION 7.04. Reliance; Limitations. (a) New Dynegy may rely, without inquiry, and until the receipt of written notice of a change in the
Shareholders Representative under Section 7.03, may continue to rely, without inquiry, upon the action of the Shareholders Representative as the action of each Shareholder in all matters referred to in this Article VII; provided,
however, that if New Dynegy is given written notice of the appointment of a successor Shareholders Representative under Section 7.03, New Dynegy shall recognize, and shall only be able to rely upon the action of, such successor
Shareholders Representative as the Shareholders Representative for all purposes under this Agreement. 
  

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 (b)Except as set forth in this Section 7.04, this Article VII creates no binding obligations between
New Dynegy, on the one hand, and the Shareholders, on the other hand. 
 ARTICLE VIII 
 General Provisions 
 SECTION 8.01. Effectiveness and Term. (a) This
Agreement shall be effective as of, and on the date of, the Closing Date; provided, however, that the provisions of Section 6.02 and Section 6.03 shall be effective as of the date hereof. If the Merger Agreement is terminated
prior to the Closing Date, this Agreement shall terminate and all rights and obligations of the parties hereunder shall terminate without any liability of any party to any other party. 
 (b)(i) The provisions of Section 2.01(b) and 3.02 shall cease to be in effect on and after the date that the Shareholders collectively directly own
Class B Shares representing less than 15% of the total combined voting power of all outstanding voting securities of New Dynegy at such time and (ii) the remaining provisions of this Agreement (other than the provisions of this Article VIII)
shall cease to be in effect on and after the date that no Class B Shares remain outstanding. 
 SECTION 8.02. Adjustments for Stock
Splits, Etc. Wherever in this Agreement there is a reference to a specific number of shares of New Dynegy’s Common Stock, then, upon the occurrence of any split, subdivision, combination or stock dividend of such class or series of stock,
the specific number of shares so referenced in this Agreement will automatically be proportionally adjusted to reflect the effect of such subdivision, combination or stock dividend on the outstanding shares of such class or series of Common Stock.

 SECTION 8.03. Intent and Interpretation. Each of parties hereto stipulates and acknowledges that New Dynegy has made, prior to the
date hereof, a careful evaluation of the Initial Shareholders, their investment objectives with regard to the Class B Shares and their lack of intent to obtain control of New Dynegy by its acquisition thereof, and the compatibility of such
objectives with the objectives of New Dynegy; that such factors were critical to New Dynegy in the decision to consummate the Acquisition and thereby issue a large block of voting securities to the Initial Shareholders; that, absent the restrictions
in this Agreement, ownership of the Class B Shares would present an unusual opportunity for the Shareholders to gain effective control of New Dynegy; that New Dynegy might have reached a different decision with regard to the Acquisition and the
resulting issuance of the Class B Shares to a group of related Persons had such Persons been other than the Initial Shareholders; therefore, that the restrictions set forth in this Agreement are a material part of the consideration received by New
Dynegy for the issuance of the Class B Shares in the Acquisition, and that the primary intent of such restrictions is to ensure that such block of securities does not come to rest in the hands or under the control of any single holder or group of
holders other than the Shareholders and that the size of such block of securities is not, except as otherwise herein provided, increased over a prescribed amount, without the consent of New Dynegy. The Initial Shareholders acknowledge and agree that
such purpose and intent are reasonable and that the restrictions set forth in this Agreement are reasonable in view of such purpose and intent. Further, the Shareholders and 
  

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 New Dynegy agree that, should any disagreement arise in the interpretation of any such restrictions as applied to any set
of facts, such disagreement shall be resolved by interpreting and applying each restriction in the manner that will most nearly effectuate the purpose and intent of such restrictions as herein stated. 
 SECTION 8.04. Specific Enforcement. Each of the parties hereto acknowledges and agrees that the other parties hereto would be irreparably damaged
and that money damages are not an adequate remedy if any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached because, among other reasons, each such provision relates to potential
control of New Dynegy. It is accordingly agreed that each party hereto shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to specifically enforce this Agreement and the terms and provisions hereof in any
court of the United States or any state thereof, in addition to any other remedy to which such party may be entitled, at law or in equity. It is further agreed that none of the parties hereto shall raise the defense that there is an adequate remedy
at law. 
 SECTION 8.05. Severability. If any term of this Agreement or the application thereof to any party or circumstance shall be
held invalid or unenforceable to any extent, the remainder of this Agreement and the application of such term to the other parties or circumstances shall not be affected thereby and shall be enforced to the greatest extent permitted by applicable
law, and in such event the parties shall negotiate in good faith in an attempt to agree to another provision (in lieu of the term or application held to be invalid or unenforceable) that will be valid and enforceable and will carry out the
parties’ intentions hereunder. 
 SECTION 8.06. Notices, Etc. All notices, requests, demands or other communications required by
or otherwise with respect to this Agreement shall be in writing and shall be deemed given (i) when made, if made by hand delivery, and upon confirmation of receipt, if made by facsimile, (ii) one business day after being deposited with a
next-day courier, postage prepaid, or (iii) three business days after being sent certified or registered mail, return receipt requested, postage prepaid, in each case to the applicable addresses set forth below (or to such other address as such
party may designate in writing from time to time): 
 If to New Dynegy: 
 c/o Dynegy Inc. 
 1000 Louisiana, Suite 5800 
 Houston, TX 77002 
 Attention: General Counsel 
 Telecopy: (713) 507-6808 
 with copies (which shall not constitute notice) to:

 Akin Gump Strauss Hauer & Feld, LLP 
 1111 Louisiana St. 
 44th Floor 
 Houston, TX 77002 
 Attention: Julien R. Smythe, Esq. 
 Telecopy: (713) 236-0822 
  

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 If to a Shareholder: 
 c/o LS Power Development, LLC 
 1700 Broadway 
 35th Floor 
 New York, NY 10019 
 Attention: Senior Counsel 
 Telecopy: (212) 615-3440 
 with copies (which shall not constitute notice) to: 
 Cravath, Swaine & Moore LLP 
 825 Eighth Avenue 
 New York, NY 10019 
 Attention: Ronald Cami, Esq. 
 Telecopy: (212) 474-3700 
 or to such other address as such party shall have designated by notice so given to each
other party. 
 SECTION 8.07. Amendments, Waivers, Etc. This Agreement may not be amended, changed, supplemented, waived or otherwise
modified or terminated except by an instrument in writing signed by all of the parties hereto (or their successors). 
 SECTION 8.08.
Entire Agreement. This Agreement embodies the entire agreement and understanding among the parties relating to the subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter. 
 SECTION 8.09. Remedies Cumulative. All rights, powers and remedies provided under this Agreement or otherwise available in respect hereof at law
or in equity shall be cumulative and not alternative, and the exercise or beginning of the exercise of any thereof by any party shall not preclude the simultaneous or later exercise of any other such right, power or remedy by such party. 

SECTION 8.10. No Waiver. The failure of any party hereto to exercise any right, power or remedy provided under this Agreement or otherwise
available in respect hereof at law or in equity, or to insist upon compliance by any other party hereto with its obligations hereunder, and any custom or practice of the parties at variance with the terms hereof shall not constitute a waiver by such
party of his or her right to exercise any such or other right, power or remedy or to demand such compliance. 
 SECTION 8.11. No Third
Party Beneficiaries. This Agreement is not intended to be for the benefit of and shall not be enforceable by any Person who or which is not a party hereto. 
  

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 SECTION 8.12. Consent to Jurisdiction. Each of the parties hereto irrevocably submits to the
exclusive jurisdiction of (a) the Court of Chancery of the State of Delaware, and (b) the United States District Court for the District of Delaware, for the purposes of any suit, action or other proceeding arising out of this Agreement or
any transaction contemplated hereby. Each of the parties hereto agrees to commence any such action, suit or proceeding either in the United States District Court for the District of Delaware, or if such suit, action or other proceeding may not be
brought in such court for jurisdictional reasons, in the Court of Chancery of the State of Delaware. Each of the parties hereto further agrees that service of any process, summons, notice or document by U.S. registered mail to such party’s
respective address set forth above shall be effective service of process for any action, suit or proceeding in Delaware with respect to any matters to which it has submitted to jurisdiction in this Section 8.12. Each of the parties hereto
irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement and the other transactions contemplated hereby in (i) the Court of Chancery in the State of Delaware, or
(ii) the United States District Court for the District of Delaware, and hereby and thereby 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 8.13. Governing Law. This Agreement shall be construed, interpreted,
and governed in accordance with the laws of the State of Delaware, without giving effect to its rules on conflicts of law. 
 SECTION 8.14.
WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 
 SECTION 8.15. Name, Captions, Gender. The name assigned this Agreement and the section captions used herein are for convenience of reference only
and shall not affect the interpretation or construction hereof. Whenever the context may require, any pronoun used herein shall include the corresponding masculine, feminine or neuter forms. 
 SECTION 8.16. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute one instrument. Each counterpart may consist of a number of copies each signed by less than all, but together signed by all, of the parties hereto. 
 SECTION 8.17. Successors and Assigns. The Shareholders shall not assign this Agreement without the written consent of New Dynegy, except to
Permitted Transferee to whom Class B Shares are transferred as contemplated herein. The Shareholder that is Transferring Class B Shares to such Permitted Transferee shall cause such Permitted Transferee to execute a joinder agreement to this
Agreement as a condition to such Transfer, the failure of which shall render such Transfer null and void. New Dynegy may assign this Agreement only to any successor to substantially all of its business as a result of a merger, consolidation or sale
by New Dynegy. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of and be enforceable by the successors and assigns of the parties hereto. 
  

 23 

 SECTION 8.18. Luminus. To the extent that Luminus is required to perform certain obligations, or
is entitled to certain rights or benefits, under this Agreement, the Shareholders Representative shall cause Luminus to perform such obligations, and shall be entitled to enforce such rights or benefits on behalf of Luminus. 
  

 24 

 IN WITNESS WHEREOF, the parties hereto have duly and validly executed this Shareholder Agreement as of
the day and year first above written. 
  

			
	DYNEGY ACQUISITION, INC.,
		
	By:	 	 /s/ LYNN A. LEDNICKY

	Name:	 	Lynn A. Lednicky
	Title:	 	Executive Vice President

  

			
	LS POWER PARTNERS, L.P.,
	
	 By: LS Power Development, LLC, its General
 Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

			
	LS POWER ASSOCIATES, L.P.,
	
	 By: LS Power Development, LLC, its General
 Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

			
	LS POWER EQUITY PARTNERS, L.P.,
	
	By: LS Power Partners, L.P., its General Partner
		
		 	 By: LS Power Development, LLC, its
 General
Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

			
	LSP POWER EQUITY PARTNERS PIE I, L.P.,
	
	By: LS Power Partners, L.P., its General Partner
		
		 	 By: LS Power Development, LLC, its
 General
Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

 25 

			
	LSP GEN INVESTORS, L.P.,
	
	By: LS Power Partners, L.P., its General Partner
		
		 	 By: LS Power Development, LLC, its
 General
Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

 26 

 SCHEDULE I to 
 Shareholder Agreement 
 Certain of the provisions to be included in the Bylaws: 

At any time when holders of the Class B common stock collectively directly own Class B common stock representing greater than or equal to 15% of the total combined
voting power of the corporation’s outstanding voting securities, the corporation shall not, and shall not permit any of its subsidiaries or Controlled Affiliates to, and no officer, employee or agent of the corporation or any subsidiary or
Controlled Affiliate thereof shall, take any of the following actions (each, a “Major Decision”), if all of the Class B Directors present at the meeting where such action is considered vote against such action: 
 (a) any amendment of the Certificate of Incorporation or Bylaws of the corporation, or adoption of any provision of the Certificate of Incorporation or
Bylaws of the corporation, after the date of the initial adoption of the Bylaws of the corporation; 
 (b) (1) any merger or
consolidation of the corporation, (2) any disposition of assets or businesses of the corporation or any of its subsidiaries or Controlled Affiliates, whether by merger or otherwise, where such sale has an aggregate fair market value in excess
of $350,000,000, (3) any acquisition, binding capital commitment, guarantee or investment (other than guarantees of obligations or investments in, wholly-owned subsidiaries) by the corporation and its subsidiaries and Controlled Affiliates,
whether by merger or otherwise, the aggregate amount, asset value or consideration for which is in excess of $350,000,000, or (4) any joint venture involving the corporation or any of its subsidiaries or Controlled Affiliates where the assets
to be contributed by the corporation and/or its subsidiaries, at the time of the binding commitment to contribute or form such joint venture is entered into, have a fair market value in excess of $350,000,000; 
 (c) payment of dividends or similar distributions by the corporation or any change in policies regarding dividends or similar distributions, other than
dividends or distributions made in the form of: 
 (1) cash; provided that at the time of declaration of such
dividend, the corporation has received an indicative rating that, after giving effect to such dividend, its senior unsecured credit ratings would be BB- (with stable outlook) or better from S&P and Ba3 (with stable outlook) or better from
Moody’s, or 
 (2) Common Stock; 
 (d) engagement of the corporation or its subsidiaries or Controlled Affiliates in any business other than its existing lines of business as of the date hereof and lines of business reasonably related thereto;

 (e) any liquidation or dissolution of the corporation, or the approval of a Company Bankruptcy Event with respect to the corporation or
any of its subsidiaries or Controlled Affiliates (other than any such event involving a subsidiary having an asset value of less than $50,000,000); 
  

 27 

 (f) issuance of (1) any Class A common stock (including options, warrants, convertible
securities and other rights to subscribe for any Class A common stock) in any transaction the aggregate consideration for which is in excess of $500,000,000 or (2) any Class B common stock or any new series of common stock or preferred
stock of the corporation (including options, warrants, convertible securities and other rights to subscribe for any Class B common stock or any such new series of common stock or preferred stock); 
 (g) incurrence of any Indebtedness by the corporation or any of its subsidiaries or Controlled Affiliates (other than any Indebtedness that refinances
any existing Indebtedness of the corporation or any of its subsidiaries on terms that are substantially similar to, or more favorable to the corporation and any of its subsidiaries than, those of the Indebtedness being refinanced) that exceeds
$500,000,000 in the aggregate; 
 (h) hiring, or terminating the employment of, the Chief Executive Officer (other than Bruce A. Williamson);

 (i) other than any joint venture arrangements with a holder of Class B common stock or an affiliate thereof, entering into any agreement
or other action which purports to or in fact limits the activities which may be conducted by any holder of Class B common stock or any of its affiliates; and 
 (j) any other transaction (or series of related transactions) that would result in the payment or receipt of consideration (including the incurrence or assumption of indebtedness and liabilities) by the corporation
and its subsidiaries or Controlled Affiliates having a fair market value in excess of $350,000,000. For purposes of this clause (j) fair market value for any hedging or similar transactions shall be based on the net exposure to the corporation
or its subsidiaries or Controlled Affiliates as a result thereof. 
 “Company Bankruptcy Event” means (a) the voluntary commencement by
a person of any proceeding or the voluntary filing of any petition seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended, or any other Federal, state or foreign bankruptcy, insolvency, receivership or
similar law, (b) the consent by a person to the institution of, or causing such person to fail to contest in a timely and appropriate manner, any involuntary proceeding or any involuntary filing of any petition of the type described in clause
(a) above, (c) the application for or consent by a person to the appointment of a receiver, trustee, custodian, sequestrator, conserver or similar official for such person or for a substantial part of such person’s property or assets,
(d) the filing of an answer by a person admitting the material allegations of the petition filed against such person or, if applicable, any of its such person’s subsidiaries in any proceeding described in (a) above, (e) the
consent by a person to any order for relief issued with respect to any proceeding described in (a) above, (f) the making of a general assignment for the benefit of creditors by a person, (g) a person admitting in writing the inability
of the such person or any of its subsidiaries or causing a person or any of its subsidiaries to fail generally to pay its debts as they become due or (h) the taking of any action by a person for the purpose of effecting any of the foregoing.
For purposes of this definition, Allegheny Hydro No. 
  

 28 

 1, Allegheny Hydro No. 2, Allegheny Hydro No. 8, L.P., Allegheny Hydro Partners, Ltd., Allegheny Hydro
No. 9, L.P. and Allegheny Number 6 Hydro Partners shall not be deemed subsidiaries of the corporation. 
 “Controlled Affiliate” means
(a) any entity that is consolidated with the corporation on the corporation’s consolidated financial statements, (b) any entity in which the corporation holds greater than or equal to 50% of the total combined voting power of such
entity’s outstanding voting securities and (c) with respect to any specific matter, any entity over which the corporation has the power (by contract or otherwise) to prevent such entity from pursuing such matter, other than any such entity
over which the Class B Control Group (as defined in the certificate of incorporation) also has the power (by contract or otherwise) to prevent such entity from pursuing such matter. 
 “Indebtedness” of any person means, without duplication, (a) all obligations of such person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of
such person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such person upon which interest charges are customarily paid, (d) all obligations of such person in respect of the deferred purchase price of
property or services (excluding current accounts payable incurred in the ordinary course of business), and (e) all capital lease obligations of such person. The Indebtedness of any person shall include (1) the Indebtedness of any other
entity to the extent such person is liable therefor as a result of such person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such person is not liable therefor,
(2) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any lien on property owned or acquired by such person, whether or not the Indebtedness
secured thereby has been assumed and (3) all guarantees by such person of Indebtedness of others. 
  

 29Registration Rights Agreement dated as of September 14, 2006

 Exhibit 4.2 
  

 REGISTRATION RIGHTS AGREEMENT 
 among 
 DYNEGY ACQUISITION, INC. 
 AND 
 THE SHAREHOLDERS LISTED ON THE SIGNATURE
PAGE HERETO 
 Dated as of September 14, 2006 
  

 REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of September 14,
2006, among DYNEGY ACQUISITION, INC., a Delaware corporation (the “Company”), and the other parties listed on the signature page hereto (each an “Initial Shareholder”, and collectively the “Initial
Shareholders”). 
 WHEREAS, pursuant to a Plan of Merger, Contribution and Sale Agreement (the “Merger Agreement”)
dated the date hereof among the Company, the Initial Shareholders and the other parties thereto, the Initial Shareholders will receive at or immediately after the Effective Time (as such term is defined in the Merger Agreement), shares of Class B
common stock, par value $.01 per share (the “Class B Common Stock”), of the Company; 
 WHEREAS, the Company and the Initial
Shareholders have entered into a Shareholder Agreement dated the date hereof (the “Shareholder Agreement”); and 
 WHEREAS,
in connection with the Merger Agreement and the Shareholder Agreement, the Company has agreed to grant to the Initial Shareholders certain registration rights set forth below. 
 NOW, THEREFORE, in consideration of the recitals, the mutual covenants and agreements herein contained, and other valuable consideration, the receipt,
adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, do hereby covenant and agree as follows: 
 SECTION 1. Definitions 
 The following capitalized terms shall have the meanings ascribed to them in
this Section 1: 
 “Affiliate” shall mean a Person that directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, another Person; provided, however, that for purposes of this Agreement (a) none of the Company or any of its subsidiaries shall be deemed an Affiliate of any
Shareholder and (b) none of the Class B Directors shall be deemed an Affiliate of the Company or any of its subsidiaries. For purposes of this definition “control” means, as to any Person, the sole power to direct or cause the
direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. The term “controlled” has a correlative meaning. 
 “Agreement” shall have the meaning set forth in the preamble hereto. 
 “Alternative Registration Statements” shall have the meaning set forth in Section 2(c). 
 “Class A Common Stock” shall mean the Class A common stock of the Company, par value $.01 per share. 

 “Class B Common Stock” shall have the meaning set forth in the recitals hereto.

 “Class B Director” shall mean any member of the board of directors of the Company elected by a class vote of holders of
the Class B Common Stock pursuant to the Company’s Certificate of Incorporation. 
 “Commission” shall mean the United
States Securities and Exchange Commission. 
 “Company” shall have the meaning set forth in the preamble hereto. 

“Deferral Period” shall have the meaning set forth in Section 4(b). 
 “Deferral Right” shall have the meaning set forth in Section 4(b). 
 “Effective Time” shall have the meaning set forth in the Merger Agreement. 
 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
 “Governmental Authority” shall mean any governmental or regulatory authority or agency. 
 “Holder” shall mean the Initial Shareholders, the Limited Distributees and each Permitted Transferee (and subsequent Permitted
Transferees thereof) of Registrable Common Stock under this Agreement to whom the rights under this Agreement has been expressly assigned in writing from a Holder. 
 “Initial Shareholder” shall have the meaning set forth in the preamble. 
 “Limited
Distributee Shelf Registration” shall have the meaning set forth in Section 2(b). 
 “Limited Distributee Shelf
Registration Period” shall have the meaning set forth in Section 2(e). 
 “Limited Distributee Shelf Registration
Statement” shall have the meaning set forth in Section 2(b). 
 “Limited Distributees” shall mean the holders
of Registrable Common Stock following a LP Stock Distribution. 
 “Limited Partners” shall mean the limited partners of, or
investor in, the Shareholder Control Group to which a distribution of Class B Common Stock is made pursuant to Section 2.02(b)(ii)(B) of the Shareholder Agreement. Only Persons who are not members of the Shareholder Control Group may be Limited
Partners. 
  

 2 

 “LP Stock Distribution” shall mean the distribution of Class B Common Stock by a
Shareholder to the Limited Partners under Section 2.02(b)(ii) of the Shareholder Agreement. 
 “LS Holders” shall mean
Holders who are members of the Shareholder Control Group. 
 “LS Power Shelf Registration” shall have the meaning set forth
in Section 2(a). 
 “LS Power Shelf Registration Period” shall have the meaning set forth in Section 2(e).

 “LS Power Shelf Registration Statement” shall have the meaning set forth in Section 2(a). 
 “Merger Agreement” shall have the meaning set forth in the recitals hereto. 
 “NASD” shall mean the National Association of Securities Dealers, Inc. 
 “Other Registration Rights Agreements” shall have the meaning given such term in Section 6(c). 
 “Person” means a natural person, a corporation, a limited liability company, a partnership, an association, a trust or any other entity
or organization, including a Governmental Authority. 
 “Permitted Transferee” shall have the meaning set forth in the
Shareholder Agreement. 
 “Prospectus” shall have the meaning set forth in Section 2(e). 
 “register” “registered” and “registration” and words of similar import refer to a registration
effected by preparing and filing with the Commission a registration statement in compliance with the Securities Act, and the declaration and ordering by the Commission of effectiveness of such registration statement or document. 
 “Registrable Common Stock” shall mean any Class A Common Stock, issuable upon conversion of Class B Common Stock, held or acquired
(as a result of owning Class B Common Stock) by the Initial Shareholders as of the Effective Time, and any securities issued or issuable in respect of any such Registrable Common Stock by way of any stock split or stock dividend or in connection
with any combination of shares, recapitalization, merger, consolidation, reorganization or otherwise. 
 “Rules” shall have
the meaning set forth in Section 3(o). 
 “Securities Act” shall mean the Securities Act of 1933, as amended.

  

 3 

 “Shareholder” shall mean any Initial Shareholder and any Permitted Transferee thereof
(as defined in the Shareholder Agreement). 
 “Shareholder Agreement” shall have the meaning set forth in the preamble
hereto. 
 “Shareholder Control Group” shall have the meaning set forth in the Shareholder Agreement. 
 “Shareholders’ Representative” shall have the meaning set forth in Section 11(a). 
 “Shelf Registration Statements” shall have the meaning set forth in Section 2(b). 
 “Shelf Registrations” shall have the meaning set forth in Section 2(b) 
 “Underwritten Offering” means a firmly underwritten offering of Registrable Common Stock, with respect to which there is a “road
show” or a “lock-up” agreement with the underwriter(s). 
 “Underwritten Offering Notice” shall have the
meaning set forth in Section 4(b). 
 SECTION 2. Registration. (a) The Company shall, at its cost, prepare and, promptly
after the Effective Time file with the Commission and thereafter use its best efforts to cause to be declared effective (unless it becomes effective automatically upon filing) a registration statement (the “LS Power Shelf Registration
Statement”) on Form S-3, which if the Company is then eligible shall be an automatic shelf registration statement, relating to the offer and sale of the Registrable Common Stock by the LS Holders from time to time in accordance with
the methods of distribution set forth in the LS Power Shelf Registration Statement and Rule 415 under the Securities Act (hereinafter, the “LS Power Shelf Registration”). 
 (b) Additionally, the Company shall, at its cost, prepare and, promptly after the Effective Time, file with the Commission and thereafter use its best
efforts to cause to be declared effective (unless it becomes effective automatically upon filing) a registration statement (the “Limited Distributee Shelf Registration Statement”, and together with the LS Power Shelf Registration
Statement, the “Shelf Registration Statements”) on Form S-3, which if the Company is then eligible shall be an automatic shelf registration statement, relating to the offer and sale of the Registrable Common Stock by Limited
Distributees from time to time in accordance with the methods of distribution set forth in the Limited Distributee Shelf Registration Statement and Rule 415 under the Securities Act (the “Limited Distributee Shelf Registration”
and together with the LS Power Shelf Registration, the “Shelf Registrations”). 
 (c) In the event that Form S-3 is not
available for the registration of the resale of Registrable Common Stock hereunder, the Company shall (i) register the resale 
  

 4 

 of the Registrable Common Stock on another appropriate form reasonably acceptable to the Shareholders’
Representative (such registration statements, “Alternative Registration Statements”) and (ii) use its best efforts (including, if reasonably requested by the Shareholders’ Representative, seeking a no-action letter from
the Commission) to register the Registrable Common Stock on Form S-3 as soon as such form is available and the Company shall maintain the effectiveness of the Alternative Registration Statements then in effect until such time as the Shelf
Registration Statements on Form S-3 covering the Registrable Common Stock has been declared effective by the Commission. During such time that Form S-3 is unavailable to the Company, all references to “Shelf Registration
Statements” shall be deemed to include references to the Alternative Registration Statements for purposes of this Agreement. 
 (d) The
Company shall, at its cost, prepare and file amendments to the Shelf Registration Statements to cover the offer and sale of any Registrable Common Stock acquired by the Shareholders after the Effective Time in accordance with the terms of the
Shareholder Agreement (to the extent each Shelf Registration Statement does not register a sufficient number of Registrable Common Stock to cover all of the Registrable Common Stock held by the Shareholders at such time) promptly after receiving
written notice from the Shareholders of such purchase, and thereafter use its best efforts to cause such amendments to the Shelf Registration Statements to be declared effective (unless they become effective automatically upon filing). 

(e) The Company shall use its commercially reasonable efforts to keep the Shelf Registration Statements continuously effective in order to permit the
applicable prospectus included therein (each, a “Prospectus”) to be lawfully delivered as to Holders of the relevant Registrable Common Stock, (x) in the case of the Limited Distributee Shelf Registration Statement, for a
period of two years from the last date on which any Shareholder acquires Registrable Common Stock or such shorter period that will terminate when all the Registrable Common Stock covered by the Limited Distributee Shelf Registration Statement
(i) have been sold pursuant thereto or (ii) are no longer restricted securities (as defined in Rule 144(k) under the Securities Act, or any successor rule thereof) (in any such case, such period being called, the “Limited
Distributee Shelf Registration Period”) and (y) in the case of the LS Power Shelf Registration Statement, until all the Registrable Common Stock covered by the LS Power Shelf Registration Statement either (i) has been sold
pursuant thereto or (ii) is no longer restricted (as defined in Rule 144(k) under the Securities Act, or any successor rule thereof), (such period being called, the “LS Power Shelf Registration Period”). All references in
this Agreement to “Prospectus” shall, except when the context requires, include with respect to the applicable Registration Statement any prospectus (or amendment or supplement thereto) filed with the Commission pursuant to Section 3
of this Agreement, including any “free writing prospectus” issued pursuant to Section 3(d). 
 (f) Notwithstanding any other
provisions of this Agreement to the contrary, the Company shall cause the Shelf Registration Statements and each Prospectus and any amendment or supplement thereto, as of each effective date of the applicable Shelf Registration Statement, amendment
or supplement, (i) to comply in all material respects with the applicable requirements of the Securities Act and the rules and 
  

 5 

 regulations of the Commission and (ii) not to contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. 
 SECTION 3. Registration Procedures. In connection with the Shelf Registrations contemplated by Section 2 hereof, the following provisions
shall apply: 
 (a) The Company shall (i) furnish to the Shareholders’ Representative, prior to the filing thereof with the
Commission, a copy of each Shelf Registration Statement and each amendment thereof and each supplement, if any, to the Prospectus included therein and, shall use its best efforts to reflect in each such document, when so filed with the Commission,
such comments as the Shareholders’ Representative reasonably may propose in writing; and (ii) include in the applicable Prospectus included in the relevant Shelf Registration Statement (or, if permitted by Commission Rule 430B(b), in
a prospectus supplement that becomes a part thereof pursuant to Commission Rule 430B(f)) that is delivered to any Holder pursuant to Section 3(d) and (e) the names of the Holders who propose to sell Registrable Common Stock pursuant
to the applicable Shelf Registration Statement as selling securityholders. 
 (b) The Company shall give written notice to the
Shareholders’ Representative, as applicable (which notice pursuant to clauses (ii)-(v) hereof shall also be given to the Holders and which shall be accompanied by an instruction to suspend the use of the applicable Prospectus until the
requisite changes have been made): 
 (i) when a Shelf Registration Statement or any amendment thereto has been filed with
the Commission and when a Shelf Registration Statement or any post-effective amendment thereto has become effective; 
 (ii)
of any request by the Commission for amendments or supplements to a Shelf Registration Statement or the applicable Prospectus included therein or for additional information if in the reasonable judgment of the Company such actions would make it
advisable to cease sales under the applicable Prospectus; 
 (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of a Shelf Registration Statement or the initiation of any proceedings for that purpose, or the issuance by the Commission of a notification of objection to the use of the form on which a Shelf Registration Statement has
been filed, and of the happening of any event that causes the Company to become an “ineligible issuer,” as defined in Rule 405 under the Securities Act; 
 (iv) of the receipt by the Company or its legal counsel of any notification with respect to the suspension of the qualification of the
Registrable Common Stock for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and 
  

 6 

 (v) of the happening of any event that requires the Company to make changes in a Shelf
Registration Statements or the applicable Prospectus in order that such Shelf Registration Statements or Prospectus do not contain an untrue statement of a material fact nor omit to state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the applicable Prospectus, in light of the circumstances under which they were made) not misleading. 
 (c) The Company shall use its best efforts to prevent the issuance of any stop order or other suspension of effectiveness of any Shelf Registration Statement, or the suspension of the qualification of any of the Registrable Common Stock for
sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal or lifting at the earliest possible time, of any order suspending the effectiveness of the applicable Shelf Registration Statements. 
 (d) The Company shall furnish to each Holder of Registrable Common Stock included within the coverage of a Shelf Registration, without charge, at least
one copy of the applicable Shelf Registration Statement and any post-effective amendment or supplement thereto (other than filings on Form 10-K, 10-Q, 8-K or Schedule 14A), including financial statements and schedules, and, if the Holder so requests
in writing, all exhibits thereto (including those, if any, incorporated by reference). The Company shall not, without the prior consent of the Shareholders’ Representative, make any offer relating to the Registrable Common Stock that would
constitute a “free writing prospectus,” as defined in Rule 405 under the Securities Act. 
 (e) The Company shall, during the
Shelf Registration Periods, as applicable, deliver to each Holder of Registrable Common Stock included within the coverage of a Shelf Registration, without charge, a copy of the applicable Prospectus (including each preliminary prospectus) included
in the applicable Shelf Registration Statement and any amendment or supplement thereto (other than filings on Form 10-K, 10-Q, 8-K or Schedule 14A) as such Person may reasonably request. The Company consents, subject to the provisions of this
Agreement, to the use of the applicable Prospectus or any amendment or supplement thereto by each of the selling Holders of the Registrable Common Stock in connection with the offering and sale of the Registrable Common Stock covered by such
Prospectus, or any amendment or supplement thereto, included in the Shelf Registration Statement. 
 (f) Prior to any public offering of the
Registrable Common Stock pursuant to a Shelf Registration Statement, the Company shall register or qualify or cooperate with the Holders of the Registrable Common Stock included therein and their respective counsel in connection with the
registration or qualification of such Registrable Common Stock for offer and sale under the securities or “blue sky” laws of such states of the United States as any Holder of the Registrable Common Stock reasonably requests in 

 

 7 

 writing and do any and all other acts or things necessary or advisable to enable the offer and sale in such jurisdictions
of the Registrable Common Stock covered by such Shelf Registration Statement; provided, however, that the Company shall not be required to (i) qualify generally to do business in any jurisdiction where it is not then so qualified
or (ii) take any action which would subject it to general service of process or to taxation in any jurisdiction where it is not then so subject. 
 (g) The Company shall cooperate with the Holders to facilitate the timely preparation and delivery of certificates representing the Registrable Common Stock to be sold pursuant to any Shelf Registration Statement free
of any restrictive legends and in such denominations and registered in such names as the Holders may request a reasonable period of time prior to sales of the Registrable Common Stock pursuant to the applicable Shelf Registration Statement.

 (h) Upon the occurrence of any event contemplated by paragraphs (ii) through (v) of Section 3(b) above during the Shelf
Registration Periods, as applicable, the Company shall use its commercially reasonable efforts to prepare and file a post-effective amendment to the applicable Shelf Registration Statement or an amendment or supplement to the applicable Prospectus
and any other required document so that, as thereafter delivered to Holders or purchasers of the Registrable Common Stock, the applicable Prospectus will not contain an untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Company notifies the Holders in accordance with paragraphs (ii) through (v) of
Section 3(b) above to suspend the use of the applicable Prospectus until the requisite changes to such Prospectus have been made, then the Holders shall suspend use of such Prospectus. During the Shelf Registration Periods, the Company will
prior to the expiration of each Shelf Registration Statement file, and use its best efforts to cause to be declared effective (unless it becomes effective automatically upon filing) within a period that avoids any interruption in the ability of
Holders of the Registrable Common Stock covered by the expiring Shelf Registration Statement to make registered dispositions, a new registration statement relating to the Registrable Common Stock, which shall be deemed the “Shelf Registration
Statements” for purposes of this Agreement. 
 (i) The Company will comply with all rules and regulations of the Commission to the
extent and so long as they are applicable to the Shelf Registrations and will make generally available to its security holders (or otherwise provide in accordance with Section 11(a) of the Securities Act) an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act, no later than 45 days after the end of a 12-month period (or 90 days, if such period is a fiscal year) beginning with the first month of the Company’s first fiscal quarter
commencing after the effective date of the Shelf Registration Statements, which statement shall cover such 12-month period. 
 (j) The
Company may require each Holder of Registrable Common Stock to be sold pursuant to a Shelf Registration Statement to furnish to the Company such information regarding the Holder and the distribution of the Registrable Common Stock as may from time
to time be required for inclusion in the Shelf Registration Statement by 
  

 8 

 the Securities Act or the rules and regulations of the Commission, and the Company may exclude from such registration the
Registrable Common Stock of any Holder that unreasonably fails to furnish such information within a reasonable time after receiving such request. 
 (k) The Company shall use its best efforts to have the shares of Registrable Common Stock listed on any domestic and foreign securities exchanges on which the Class A Common Stock is then listed; 
 (l) The Company shall enter into any such agreements (including with respect to Underwritten Offerings an underwriting agreement) and take all such other
actions in connection therewith in order to expedite or facilitate the disposition of such Registrable Common Stock pursuant to the Shelf Registration Statements contemplated by this Agreement. 
 (m) The Company shall (i) make reasonably available for inspection by the Holders, any underwriter participating in any disposition pursuant to a
Shelf Registration Statement and any attorney, accountant or other agent retained by the Holders (up to one attorney, accountant or other agent) or any such underwriter, all relevant financial and other records, pertinent corporate documents and
properties of the Company and (ii) cause the Company’s officers, directors, employees, accountants and auditors to supply all relevant information reasonably requested by the Holders or any such underwriter, attorney, accountant or agent
in connection with a Shelf Registration Statement, in each case, as shall be reasonably necessary to enable such Persons, to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act. 
 (n) The Company, if requested by Holders of a majority of the Registrable Common Stock covered by a Shelf Registration Statement in connection with an
Underwritten Offering, shall (i) cause its counsel to deliver an opinion and updates thereof relating to the Registrable Common Stock in customary form addressed to such requesting Holders and underwriters, if any, thereof (ii) cause its
officers to execute and deliver all customary documents and certificates and updates thereof requested by any underwriters of the Registrable Common Stock and (iii) subject to the execution by the applicable Holders and underwriter of any
undertakings required by AU Section 634, use its best efforts to cause its independent public accountants and the independent public accountants with respect to any other entity for which financial information is provided in the Shelf
Registration Statement to provide to the selling Holders of the applicable Registrable Common Stock and any underwriters in any Underwritten Offering a comfort letter in customary form and covering matters of the type customarily covered in comfort
letters in connection with primary underwritten offerings. 
 (o) In the event that any broker-dealer registered under the Exchange Act shall
underwrite any Registrable Common Stock or participate as a member of an underwriting syndicate or selling group or “assist in the distribution” (within the meaning of the Conduct Rules (the “Rules”) of the NASD) thereof,
whether as a Holder of such Registrable Common Stock or as an underwriter, a placement or sales agent or a broker 
  

 9 

 or dealer in respect thereof, or otherwise, the Company will assist such broker-dealer in complying with the requirements
of such Rules, including, without limitation, by (i) if such Rules, including Rule 2720, shall so require, engaging (at the Holder’s expense) a “qualified independent underwriter” (as defined in Rule 2720) to
participate in the preparation of the applicable Shelf Registration Statement relating to such Registrable Common Stock, to exercise usual standards of due diligence with respect thereto and, if any portion of the offering contemplated by such Shelf
Registration Statement is an underwritten offering or is made through a placement or sales agent, to recommend the price of such Registrable Common Stock, (ii) indemnifying any such qualified independent underwriter to the extent of the
indemnification of underwriters provided in Section 6 hereof and (iii) providing such information to such broker-dealer as may be required in order for such broker-dealer to comply with the requirements of the Rules. 
 (p) The Company shall use its best efforts to take all other steps necessary to effect the registration of the Registrable Common Stock covered by a
Shelf Registration Statement contemplated hereby. 
 (q) If requested by the Shareholders’ Representative in connection with an
Underwritten Offering, the Company shall make appropriate officers of the Company available for meetings with prospective purchasers of the Registrable Common Stock and prepare and present to potential investors “road show” material in a
manner consistent with other offerings of equity securities, provided, however, in no event shall any officers of the Company be required to participate in a number of “road shows” during any period that exceeds the number of
Underwritten Offerings permitted during such period pursuant to Section 4(a). 
 SECTION 4. Underwritten Offerings.
(a) Subject to the terms and conditions herein, the number of Underwritten Offerings for the benefit of the LS Holders that may be effected hereunder is as follows: 
 (i) up to two during the first 24 months after the Effective Time; provided, however, that in no event shall more than one
Underwritten Offerings be consummated during the first and second twelve month periods, respectively; and 
 (ii) up to two
during each 12 month period following the first 24 months after the Effective Time. 
 The aggregate proceeds to be received by the LS Holders (or, in the
case of any offering including shares sold by the LS Holders and Chevron U.S.A., Inc., by all selling stockholders in such offering) in any such Underwritten Offering shall be not less than $100,000,000. No Underwritten Offerings shall be required
to be made for the benefits of the Limited Distributees. 
 (b) The Shareholders’ Representative shall provide written notice to the
Company of the LS Holders’ intent to effect an Underwritten Offering (the “Underwritten Offering Notice”). In the event at the time the Underwritten Offering Notice is given the 
  

 10 

 Company is conducting or about to conduct a firmly underwritten offering of Class A Common Stock (or securities
convertible into Class A Common Stock) with aggregate proceeds to the Company in excess of $100,000,000, the Company may, by providing written notice to the Shareholders’ Representative within five business days of receipt of the
Underwritten Offering Notice, defer (the “Deferral Right”) the commencement of an Underwritten Offering for a period of up to 60 days (the “Deferral Period”) (and in such case may exercise its rights under
Section 6(a)); provided, however, that the Company may not exercise its Deferral Right more than once during any calendar year. If the Company does not give timely notice to the Shareholders’ Representative of its exercise of
its Deferral Right with respect to any Underwritten Offering hereunder, such Deferral Right shall be deemed not to have been exercised. After the Company has exercised its Deferral Right for a calendar year, the Shareholders’ Representative
shall not be required to deliver Underwritten Offering Notices thereafter in that calendar year. 
 SECTION 5. Registration Expenses.
(a) All expenses incident to the Company’s performance of and compliance with this Agreement will be borne by the Company, regardless of whether a Shelf Registration Statement is ever filed or becomes effective, including without
limitation: 
 (i) all registration and filing fees and expenses; 
 (ii) all fees and expenses of compliance with federal securities and state “blue sky” or securities laws; 
 (iii) all expenses of printing (including printing certificates for the Registrable Common Stock to be issued and printing of Prospectuses), messenger
and delivery services and telephone; 
 (iv) all fees and disbursements of counsel for the Company; 
 (v) all application and filing fees in connection with listing the Registrable Common Stock on a national securities exchange or automated quotation
system pursuant to the requirements hereof; and 
 (vi) all fees and disbursements of independent certified public accountants of the Company
(including the expenses of any special audit and comfort letters required by or incident to such performance). 
 (b) The Company will bear
its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company. 
 (c) In connection with the Shelf Registration Statements and each Underwritten Offering contemplated by
this Agreement, the Company will reimburse the LS Holders for the reasonable fees and disbursements of one legal counsel. 
  

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 SECTION 6. Lock-ups; Blackouts. 
 (a) Shareholder Lock-ups. Each Shareholder agrees that, if required in connection with a public offering by the managing underwriter, it shall be
bound by the terms of the “lock-up” agreement between the Company and any underwriter of Class A Common Stock (or other equity securities of the Company) or debt securities of the Company that are convertible into equity securities of
the Company which may be entered into in connection with an underwritten public offering of such securities by the Company for its own account (except as a part of such offering, if permitted, or pursuant to one or more registration statements
relating to any employee benefit plan on Form S-8 (or any substitute form that may be adopted by the Commission)); provided, that (i) such “lock-up” period shall (i) commence on the day following the pricing of
such offering and (ii) shall expire upon the earlier of (x) the first date any comparable “lock-up” with respect to the Company, any member of the Company’s board of directors, the Company’s management or any other
shareholder of the Company (in each case, in connection with the applicable public offering) expires or is waived (and the Company hereby agrees to give the Shareholders’ Representative prompt written notice of any such expiration or waiver)
and (y) 60 days following such commencement; provided, further, that, no Shareholders shall be obligated to enter into a “lock-up” pursuant to this Section 6(a) more than once during any calendar year.

 (b) Company Lock-ups. To the extent timely requested by an underwriter or broker-dealer in an offering pursuant to an Underwritten
Offering under an LS Power Shelf Registration, the Company agrees not to effect any offer, sale or other distribution of any of its capital stock for its own account, including any private placement, or to pledge, contract or otherwise obligate
itself to do so, during the period beginning on the day following the pricing of the applicable offering and ending the number of days after as reasonably requested by such underwriter or broker-dealer (but not to exceed the earlier of (x) the
date the comparable “lock-up” on the applicable LS Holder terminates and (y) 60 days after such offering). Such “lock-up” shall not be applicable to one or more registration statements relating to any employee benefit
plan on Form S-8 (or any substitute form that may be adopted by the Commission)). 
 (c) Other Registration Rights Agreements.
(i)The Company agrees that any agreement entered into after the Effective Time to which the Company grants registration rights with respect to the Company’s equity securities (collectively, “Other Registration Rights
Agreements”) shall contain a provision under which each party (other than the Company) to each such agreement (the “Other Holders”) agrees, to the extent requested by an underwriter or broker-dealer in an offering pursuant
to a Shelf Registration, not to effect any public offer, sale or distribution of any such securities during the period beginning on the day following the pricing of the applicable offering and ending the number of days reasonably requested by such
underwriter or broker-dealer (but not to exceed the earlier of (x) the date the comparable “lock-up” on the applicable Shareholder terminates and (y) 60 days) after such offering; provided, that, the Other
Holders shall not be obligated to enter into a number of “lock-up” agreements pursuant to this Section 6(c) in any period that exceeds the number of Underwritten Offerings that LS Holders are entitled to make during such period
pursuant to Section 4(a). 
  

 12 

 (ii) The Company shall not agree to any amendment, modification or waiver of its registration rights
agreement with Chevron U.S.A., Inc. dated the date hereof, or of any Other Registration Rights Agreement, if such amendment, modification or waiver is materially disadvantageous to any party to this Agreement (other than the Company). 
 (d) Blackouts. During any calendar year, the Company shall be entitled to suspend sales under the Shelf Registration Statements for a reasonable
period of time, but not in excess of 45 days in the aggregate of which no more than 30 days may be consecutive, if the Company notifies the Holders, within the latter of five business days (or if impracticable, as soon as practicable) in advance of
such suspension that, in the opinion of its counsel, the Company would be required to disclose in the Shelf Registration Statements information not otherwise then required by law to be publicly disclosed and, in the good faith judgment of the board
of directors of the Company, such disclosure is reasonably likely to adversely affect any material business transaction or negotiation in which the Company is then engaged. 
 SECTION 7. Indemnification. (a) The Company agrees to indemnify and hold harmless each Holder whose Registrable Common Stock are included in
a Shelf Registration Statement, each officer, director and Affiliate of each such Holder and each Person, if any, who controls such Holder within the meaning of the Securities Act from and against any losses, claims, damages or liabilities, joint or
several, or any actions in respect thereof (including, but not limited to, any losses, claims, damages, liabilities or actions relating to purchases and sales of the Registrable Common Stock) to which such Holder, director, officer, Affiliate or
controlling Person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in a Shelf Registration Statement or Prospectus, including any document incorporated by reference therein, or in any amendment or supplement thereto or in any preliminary prospectus or “issuer free writing
prospectus,” as defined in Rule 433 under the Securities Act (“Issuer FWP”), relating to a Shelf Registration, or arise out of, or are based upon, the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading, and shall reimburse, as incurred, the Indemnified Parties for any legal or other expenses reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action in respect thereof; provided, however, that the Company shall not be liable in any such case to the extent that such loss, claim, damage or liability arises directly out of or is based upon
any untrue statement or alleged untrue statement made in, or omission or alleged omission from, a Shelf Registration Statement or Prospectus or in any amendment or supplement thereto or in any preliminary prospectus or Issuer FWP relating to a Shelf
Registration in strict conformity with written information pertaining to such Holder and furnished to the Company by or on behalf of such Holder specifically for inclusion therein; provided further, however, that the indemnity
provisions of this Section 7 will be in addition to any liability which the Company may otherwise have to such Holder, director, officer, Affiliate or controlling Person. If applicable, the Company shall also indemnify underwriters, their
officers and directors and each Person who controls such underwriters 
  

 13 

 within the meaning of the Securities Act or the Exchange Act to the same extent as provided above with respect to the
indemnification of the Holders of the Registrable Common Stock if requested by such Holders. 
 (b) Each Holder, severally and not jointly,
agree to indemnify and hold harmless the Company, its officers and directors and each Person, if any, who controls the Company within the meaning of the Securities Act from and against any losses, claims, damages or liabilities or any actions in
respect thereof (including, but not limited to, any losses, claims, damages, liabilities or actions relating to purchases and sales of the Registrable Common Stock), to which the Company or any such controlling Person may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in a Shelf Registration
Statement or Prospectus, including any document incorporated by reference therein, or in any amendment or supplement thereto or in any preliminary prospectus or Issuer FWP relating to a Shelf Registration, or arise out of, or are based upon, the
omission or alleged omission to state therein a material fact necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or omission or alleged untrue statement or omission was made in
strict conformity with written information pertaining to such Holder and furnished to the Company by or on behalf of such Holder specifically for inclusion therein; and, subject to the limitation set forth immediately preceding this clause, shall
reimburse, as incurred, the Company for any legal or other expenses reasonably incurred by the Company or any such controlling Person in connection with investigating or defending any loss, claim, damage, liability or action in respect thereof. The
indemnity provisions of this Section 7 will be in addition to any liability which such Holder may otherwise have to the Company or any of its controlling Persons. 
 (c) Promptly after receipt by an indemnified party under this Section 7 of notice of the commencement of any action or proceeding (including a governmental investigation), such indemnified party will, if a claim
in respect thereof is to be made against the indemnifying party under this Section 7, notify the indemnifying party of the commencement thereof; but the failure to notify the indemnifying party shall not relieve it from any liability that it
may have under Section 7(a) or (b) above except to the extent that it has been materially prejudiced by such failure; and provided further that the failure to notify the indemnifying party shall not relieve it from any liability that it
may have to an indemnified party otherwise than under Section 7(a) or (b) above. In case any such action is brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party
will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with
the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof the indemnifying party will not be liable to such
indemnified party under this Section 7 for any legal or other expenses, other than reasonable costs of investigation, subsequently incurred by such indemnified 
  

 14 

 party in connection with the defense thereof. No indemnifying party shall, without the prior written consent of the
indemnified party which shall not be unreasonable withheld, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such
indemnified party unless such settlement (i) includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action, and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any indemnified party. 
 (d) If the indemnification provided for in
this Section 7 is unavailable or insufficient to hold harmless an indemnified party under Section 7(a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of
the losses, claims, damages or liabilities (or actions in respect thereof) referred to in Section 7(a) or (b) above in such proportion as is appropriate to reflect the relative fault of the indemnifying party or parties on the one hand and
the indemnified party on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof) as well as any other relevant equitable considerations. The relative fault
of the parties shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on
the one hand or such Holder or such other indemnified party, as the case may be, on the other, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid
by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this Section 7(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any action or claim which is the subject of this Section 7(d). Notwithstanding any other provision of this Section 7(d), the Holders shall not be required to contribute any amount in excess of the
amount by which the net proceeds received by such Holders from the sale of the Registrable Common Stock pursuant to the applicable Shelf Registration Statement exceeds the amount of damages which such Holders have otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to indemnification or contribution
from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 7(d), each Person, if any, who controls such indemnified party within the meaning of the Securities Act or the Exchange Act shall have the
same rights to contribution as such indemnified party and each Person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as the Company. 
 (e) The agreements contained in this Section 7 shall survive the sale of the Registrable Common Stock pursuant to the Shelf Registration Statements
and shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation made by or on behalf of any indemnified party. 
  

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 SECTION 8. Rules 144 and 144A. The Company shall use its best efforts to file the reports
required to be filed by it under the Securities Act and the Exchange Act in a timely manner and, if at any time the Company is not required to file such reports, it will, upon the request of any Holder, make publicly available other information so
long as necessary to permit sales of their Registrable Common Stock pursuant to Rules 144 and 144A. The Company covenants that it will take such further action as any Holder may reasonably request, all to the extent required from time to time
to enable such Holder to sell Registrable Common Stock without registration under the Securities Act within the limitation of the exemptions provided by Rules 144 and 144A (including the requirements of Rule 144A(d)(4)). 
 SECTION 9. Assignment by Shareholders. 
 (a) Assignment of Rights. Subject to Section 9(b), the rights of the Shareholders under this Agreement with respect to any Registrable Common Stock owned by a Shareholder may be assigned to any Permitted Transferee (as defined
in the Shareholder Agreement) who acquires Registrable Common Stock from such Shareholder except that any Permitted Transferee who (i) is not an affiliate of the Company and (ii) acquires such Registrable Common Stock (x) pursuant to
a public offering registered under the Securities Act, or (y) pursuant to a transfer made in accordance with Rule 144 under the Securities Act (or any similar successor provision) may not assign rights hereunder with respect to such Registrable
Common Stock. No assignment of rights hereunder is permitted if it is made to a Permitted Transferee (as defined in the Shareholder Agreement) who, after such transfer, would individually, or with a “group” (as defined under the Exchange
Act), “beneficially own” (as defined under the Exchange Act) less than 1% of the Company’s outstanding common stock. Any assignment of rights pursuant to this Section 9(a) shall be effective upon receipt by the Company of written
notice from the applicable Shareholder (i) stating the name and address of any assignee, (ii) describing the manner in which the assignee acquired Registrable Common Stock from Shareholder and (iii) identifying the Registrable Common
Stock with respect to which the rights under this Agreement are being assigned. Notwithstanding the foregoing, Limited Partners may not assign their rights hereunder. 
 (b) Scope of Assignment. The rights of an assignee under Section 9(a) shall be the same rights granted to a Shareholder under this Agreement, except that in no event shall the Company’s obligations
hereunder be increased due to any such assignment. After any such assignment, the applicable Shareholder shall retain its rights under this Agreement with respect to all other Registrable Common Stock owned by such Shareholder. 
 SECTION 10. Termination. This Agreement shall terminate upon the later to occur of expiration of (i) the Limited Distributee Shelf
Registration Period and (ii) LS Power Shelf Registration Period. 
  

 16 

 SECTION 11. (a) Authorization of the Shareholders’ Representative. 
 (i) LS Power Development, LLC (and each successor appointed in accordance with Section 11(c), the “Shareholders’
Representative”) hereby is appointed, authorized and empowered to act, on behalf of each Shareholder, and after a LP Stock Distribution, each Limited Distributees in connection with the activities to be performed on the Shareholders’
and the Limited Distributees’, if any, behalf under this Agreement, for the purposes and with the powers and authority set forth in this Section 11, which will include the power and authority: 
 (A) to execute and deliver such amendments, waivers and consents in connection with this Agreement as the Shareholders’
Representative, in its reasonable discretion, may deem necessary or desirable to give effect to the intentions of this Agreement; 
 (B) as the Shareholders’ Representative of the Shareholders and the Limited Distributees, if any, to enforce and protect the Shareholders’ and Limited Distributees’, if any, rights and interests and to enforce and protect the
Shareholders’ and Limited Distributees’, if any, rights and interests arising out of or under or in any manner relating to this Agreement; 
 (C) to refrain from enforcing any right of any Shareholder, Limited Distributee and/or of the Shareholders’ Representative arising out of or under or in any manner relating to this Agreement; and 
 (D) to make, execute, acknowledge and deliver all such other contracts, agreements, orders, receipts, endorsements, notices, requests,
instructions, certificates, stock powers, letters and other writings and, in general, to do any and all things and to take any and all action that the Shareholders’ Representative, in its sole and absolute discretion, may consider necessary or
proper or convenient in connection with or to carry out the activities described in Sections 11(i)(A) through (D). 
 (ii) The grant of
authority provided for in this Section 11(a): (i) is coupled with an interest and is being granted, in part, as an inducement to the Shareholders and the Company to enter into this Agreement and will be irrevocable and survive the death,
incompetence, bankruptcy or liquidation of any Shareholder and will be binding on any successor thereto and (ii), subject to Section 11(c), may be exercised by the Shareholders’ Representative acting by signing as Shareholders’
Representative of any Shareholder or Limited Distributee, if any. 
 (b) Compensation; Exculpation; Indemnity. 
 (i) The Shareholders’ Representative will not be entitled to any fee, commission or other compensation for the performance of its service hereunder.

 (ii) In dealing with this Agreement and any instruments, agreements or documents relating thereto, and in exercising or failing to
exercise all or any of the powers conferred 
  

 17 

 upon the Shareholders’ Representative hereunder or thereunder, (x) the Shareholders’ Representative will
not assume any, and will incur no, liability whatsoever to any Shareholder or Limited Distributee, if any, because of any error in judgment or other act or omission performed or omitted hereunder or in connection with this Agreement including
because of the Shareholders’ Representative’s own negligence; and (y) the Shareholders’ Representative will be entitled to rely on the advice of counsel, public accountants or other independent experts experienced in the matter
at issue, and any error in judgment or other act or omission of the Shareholders’ Representative pursuant to such advice will not subject the Shareholders’ Representative to liability to any Shareholder, or Limited Distribute, if any.

 (c) Removal and Replacement of Shareholders’ Representative; Successor Shareholders’ Representative. 

(i) If the Shareholders’ Representative or his heir or personal representative, as the case may be, advise the Shareholders and the Limited
Distributees, if any, that the Shareholders’ Representative is unavailable to perform its duties hereunder, within ten business days of notice of such advice, a Shareholders’ Representative, who must be a Shareholder will be appointed by
the Shareholders who hold (or held, as applicable) a majority of the Registrable Common Stock then held by such parties. 
 (ii) Any
Shareholders’ Representative may be removed at any time by a written notice delivered by the Shareholders who hold (or held, as applicable) a majority of the Registrable Common Stock then held by the Shareholders to the Shareholders’
Representative, the other Shareholders and the Company. No Shareholders’ Representative may be removed until Shareholders who hold (or held, as applicable) a majority of the Registrable Common Stock then held by the Shareholders have replaced
such Shareholders’ Representative by written notice delivered to the Shareholders and the Company. 
 (iii) If any successor
Shareholders’ Representative is appointed under Sections 11(c)(ii) or 11(c)(iii), such appointment will be effective upon delivery of written notice thereof executed by the Shareholders who hold (or held, as applicable) a majority of the
Registrable Common Stock then held by the Shareholders to each of the Shareholders’ Representative, the other Shareholders, Limited Distributees, and the Company. Any successor Shareholders’ Representative will have all of the authority
and responsibilities conferred upon or delegated to a Shareholders’ Representative pursuant to this Section 10(c). 
 (d)
Reliance; Limitations. 
 (i) The Company may conclusively and absolutely rely, without inquiry, and until the receipt of
written notice of a change of the Shareholders’ Representative under Section 11(c), may continue to rely, without inquiry, upon the action of the Shareholders’ Representative as the action of each Shareholder or Limited Distributee,
if any, in all matters referred to in this Section 11; provided, however, that if the Company is given written notice of the appointment of a successor Shareholders’ Representative under 
  

 18 

 Section 11(c), the Company will be obligated to recognize, and will only be able to so rely upon the action of, such
successor Shareholders’ Representative as the Shareholders’ Representative for all purposes under this Agreement. 
 SECTION 12.
Miscellaneous. 
 (a) Favored Nations. Except as herein provided, for a period of five years from the Effective Time, the
Company shall not provide registration rights to any other party which, taken as a whole, are more favorable than those provided to the LS Holders hereunder, without also offering to the LS Holders such more favorable rights. The Company shall give
the Shareholders’ Representative notice within 15 days after the execution of any agreement (including the terms thereof) between the Company and a third party which triggers a right of the LS Holders to invoke the favored nations provision of
this Section 11(a). 
 (b) Confidentiality. The Holders acknowledge that any confidential information transmitted to them in
connection with the performance of this Agreement (including a notice of an event under Sections 3(b)(ii)-(v) and Section 6(d)) may be material non-public information as contemplated by Regulation D under the Exchange Act and
agrees to keep such information confidential until such time as the Company has publicly disclosed the subject matter thereof. The Shareholders’ Representative shall advise the Limited Distributees of this provision upon a distribution thereto
and each Limited Distributee shall be deemed to have agreed to this provision if it provides information regarding its identity for inclusion in the Limited Distributee Registration Statement. 
 (c) Remedies. The Company acknowledges and agrees that any failure by the Company to comply with its obligations hereunder may result in material
irreparable injury to the Holders for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely and that, in the event of any such failure, any Holder may obtain such relief as may be
required to specifically enforce the Company’s obligations hereunder. The Company further agrees to waive the defense in any action for specific performance that a remedy at law would be adequate. 
 (d) No Inconsistent Agreements. The Company represents and warrants that the rights granted to the Holders hereunder do not in any way conflict
with and are not inconsistent with the rights granted to the holders of the Company’s securities under any agreement in effect on the date hereof other than rights granted to Chevron U.S.A., Inc. under a registration rights agreement dated the
date hereof. 
 (e) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers
or consents to departures from the provisions hereof may not be given, except by the Company and the Shareholders, or with respect to the rights of Limited Distributees after a LP Stock Distribution with the written consent of Limited Distributees
holding a majority of the aggregate value of the Registrable Common Stock affected by such amendment, modification, supplement, waiver or consent. 
  

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 (f) Notices. All notices and other communications provided for or permitted hereunder shall be
made in writing by hand delivery, first-class mail, facsimile transmission, or air courier which guarantees overnight delivery: 
 (1) if to
Holders (other than the Shareholders), at the most current address given by such Person to the Company. 
 (2) if to a Shareholder;

 c/o LS Power Development, LLC 
 1700 Broadway 
 35th Floor 
 New York, NY 10009 
 Fax No.: (212) 615-3440 
 Attention: Senior Counsel 
 with a copy (which shall not constitute notice) to: 
 Cravath, Swaine & Moore LLP 
 Worldwide Plaza 
 825 Eighth Avenue 
 New York, NY 10019-7475 
 Fax No.: (212) 474-3700 
 Attention: Ronald Cami, Esq. 
 (3) if to the
Company, at its address as follows: 
 Dynegy Inc. 
 1000 Lousiana, Suite 5800 
 Houston, TX 77002 
 Fax No.: (713) 507-6808 
 Attention:
General Counsel 
 with a copy (which shall not constitute notice) to: 
 Akin Gump Strauss Hauer & Feld LLP 
 111 Louisiana St. 
 44th Floor 
 Houston, TX 77002 
 Fax No.: (713) 236-0822 
 Attention: Julien R. Smythe 
 All such
notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; three business days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged by
recipient’s facsimile machine operator, if sent by facsimile transmission; and on the day delivered, if sent by overnight air courier guaranteeing next day delivery. 
  

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 (g) Third Party Beneficiaries. The Limited Distributees shall be third party beneficiaries to the
agreements made hereunder between the Company, on the one hand, and the Shareholders, on the other hand, and shall have the right to enforce such agreements directly to the extent they may deem such enforcement necessary or advisable to protect
their rights or the rights of Limited Distributees hereunder. The Limited Distributees shall not be entitled to indemnification under Article 7 with respect to sales on the Limited Distributee Shelf Registration Statement during periods in
which they have been notified hereunder that they may not make sales on such Limited Distributee Shelf Registration Statement. 
 (h)
Successors and Assigns. This Agreement shall be binding upon the Company and its successors and assigns. 
 (i) Counterparts.
This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same
agreement. 
 (j) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise
affect the meaning hereof. 
 (k) Governing Law; Submission to Jurisdiction; Waiver of Jury Trial. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ITS RULES ON CONFLICTS OF LAW. EACH PARTY HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 
 (l) Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be
affected or impaired thereby. 
 (m) Entire Agreement. This Agreement constitutes the entire agreement, and supersede all prior
agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof. 
 (n) Registrable
Common Stock Held by the Company. Whenever the consent or approval of Holders of a specified percentage of the aggregate value of Registrable Common Stock is required hereunder, Registrable Common Stock held by the Company or its affiliates
(other than subsequent Holders of Registrable Common Stock if such subsequent Holders are deemed to be affiliates solely by reason of their holdings of such Registrable Common Stock) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage. 
  

 21 

 IN WITNESS WHEREOF, the Company and the Initial Shareholders have caused this Agreement to be duly
executed as of the date first above written. 
  

			
	DYNEGY ACQUISITION, INC.,
		
	By:	 	 /s/ LYNN A. LEDNICKY

	Name:	 	Lynn A. Lednicky
	Title:	 	Executive Vice President

  

			
	 LS POWER PARTNERS, L.P.,
  
 By: LS Power Development, LLC, its
 General Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

			
	 LS POWER ASSOCIATES, L.P.,
  
 By: LS Power Development, LLC, its
 General Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

			
	 LS POWER EQUITY PARTNERS, L.P.,
  
 By: LS Power Partners, L.P., its
 General Partner
  

		 	 By: LS Power Development, LLC,
 its General
Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

 22 

			
	 LS POWER EQUITY PARTNERS PIE I,
 L.P.,
  
 By: LS Power Partners, L.P., its General
 Partner
  

		 	 By: LS Power Development, LLC,
 its General
Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

			
	 LSP GEN INVESTORS, L.P.,
  
 By: LS Power Partners, L.P., its General
 Partner
  

		 	 By: LS Power Development, LLC,
 its General
Partner

		
	By:	 	 /s/ FRANK HARDENBERGH

	Name:	 	Frank Hardenbergh
	Title:	 	Authorized Signatory

  

 23

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