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Exhibit
10.1
November 28,
2007
Mr. Bruce A.
Williamson
79 Wincrest Falls
Cypress, Texas 77429
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Re: |
Termination of Employment Agreement and Supplemental Benefits
Agreement |
Dear Bruce:
This letter is written to
document certain agreements between Dynegy Inc.
(“Dynegy”) and you regarding your employment agreement
with Dynegy, dated October 18, 2002, and as subsequently
amended (the “Employment Agreement”), and your
eligibility to receive certain benefits, as discussed
below.
I. Employment
Agreement
Both Dynegy and you have
determined that continued maintenance of your Employment Agreement
after the expiration of its current Term (as defined in the
Employment Agreement) on December 31, 2007, is no longer
required with respect to your employment with Dynegy or one of its
subsidiaries or affiliates (collectively, the
“Company”). Accordingly, this letter serves as formal
written notice by Dynegy and you, pursuant to Paragraph 2(a) of the
Employment Agreement, that both parties have hereby elected to not
extend the Term of the Employment Agreement. As a result, the
Employment Agreement will terminate effective December 31,
2007.
II. Supplemental
Benefits
In addition to the other
Company benefits that are otherwise available for officers of the
Company, effective January 1, 2008, you will be eligible to
receive the following benefits in accordance with the terms and
conditions of this agreement or the particular plan or policy, as
applicable:
A. Change in Control Severance
Benefits
For the period of time that
the Second Supplement to the Dynegy Inc. Executive Severance Pay
Plan, as currently amended and as the same may be further amended
or supplemented from time to time (the “Second
Supplement”), remains in effect, and assuming your continued
employment with the Company, you will be eligible to receive,
pursuant to this agreement, the severance benefits of a Level One
Covered Individual (as defined in the Second Supplement) under the
Second Supplement in accordance with the terms and conditions of
the Second Supplement, which are incorporated herein by reference
except as such terms and conditions are otherwise modified herein,
provided you agree to all such terms and conditions. (In the event
the Second Supplement is replaced by a successor change in control
severance plan, you will be eligible to participate in such
successor plan.)
Mr. Bruce A. Williamson
November 28, 2007
Page 2
You hereby agree to all terms
and conditions of the Second Supplement, including but not limited
to, the provisions of Section 1 3.5
(Confidentiality/Noncompete/Nonsolicitation), with the following
modifications for purposes of this agreement:
1. Section 2.1(c)(2) is
hereby modified to require a material diminution in your annual
base salary from the annual base salary provided to you immediately
prior to the date on which a Change in Control (as defined in the
Second Supplement) occurs;
2. By your execution of this
agreement, you are eligible to receive the same severance benefits
hereunder as a Level One Covered Individual under the Second
Supplement who signed the letter described in Section 2.1(h)
on or before April 1, 2007;
3. Upon your entitlement to
receive severance benefits hereunder, the lump sum payments
described in Subsections 3.1(a) and (b) shall be paid to you
in accordance with the terms and conditions hereof no later than
March 15th of the calendar year following the year in which
your Involuntary Termination (as defined in the Second Supplement)
occurs;
4. Outplacement services and
benefits under Section 3.1(e) will be provided in accordance
with Internal Revenue Code Section 409A and the regulations
and guidance issued thereunder (“Code
Section 409A”); and
5. You are not entitled to
receive a Gross-up Payment (as defined in the Second Supplement)
under Section 3.4 (you will be covered under a separate excise
tax reimbursement policy of the Company).
Each of the payments of
severance, continued medical and outplacement benefits provided
herein are designated as separate payments for purposes of the
short-term deferral rules under Treasury Regulation
Section 1.409A-1(b)(4)(i)(F), the exemption for involuntary
terminations under separation pay plans under Treasury Regulation
Section 1.409A-1(b)(9)(iii), the exemption for
medical
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