Exhibit 18
June 14, 1999
Energy Convergence Holding Company
c/o Dynegy Inc.
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger (the "Merger
Agreement") dated as of the date hereof among Illinova Corporation, an Illinois
corporation ("Illinova"), Energy Convergence Holding Company, an Illinois
corporation ("Newco"), Dynegy Acquisition Company, a Delaware corporation, and a
wholly owned subsidiary of Newco ("DAC"), Energy Convergence Acquisition
Company, an Illinois corporation, and a wholly owned subsidiary of Newco
("IAC"), and Dynegy Inc., a Delaware corporation ("Dynegy"), pursuant to which
DAC will be merged with and into Dynegy, and IAC will be merged with and into
Illinova.
Pursuant to the terms and conditions of the Merger Agreement, the
undersigned hereby agrees that it will make or cause to be made an election
pursuant to Section 4.1(d) of the Merger Agreement to receive Cash Election
Shares (as defined in the Merger Agreement) and that upon consummation of the
transactions contemplated thereby, each share of common stock, par value $.01
per share, of Dynegy owned by the undersigned as of the Effective Time (as
defined in the Merger Agreement) will be converted into and exchangeable for
cash and certain securities of Newco.
The undersigned understands that it may be deemed to be an "affiliate"
of Dynegy or Illinova for purposes of Rule 145 promulgated under the Securities
Act of 1933, as amended (the "Act"). The undersigned is delivering this letter
of undertaking and commitment pursuant to Section 8.17 of the Merger Agreement.
With respect to such securities of Newco as may be received by the
undersigned pursuant to the Merger Agreement (the "Shares"), the undersigned
represents to and agrees with Newco that:
A. The undersigned will not make any offer to sell or any sale or
other disposition of all or any part of the Shares in violation of the Act or
the rules and regulations thereunder, including Rule 145, and will hold all the
Shares subject to all applicable provisions of the Act and the rules and
regulations thereunder.
Energy Convergence Holding Company
June 14, 1999
Page 2
B. The undersigned has been advised that the offering, sale and
delivery of the Shares to the undersigned pursuant to the Merger Agreement will
be registered under the Act on a Registration Statement on Form S-4. The
undersigned has also been advised, however, that, since the undersigned may be
deemed an "affiliate" of Dynegy or Illinova, any public reoffering or resale by
the undersigned of any of the Shares will, under current law, require either (i)
the further registration under the Act of the Shares to be sold, (ii) compliance
with Rule 145 promulgated under the Act (permitting limited sales under certain
circumstances) or (iii) the availability of another exemption from registration
under the Act.
C. The undersigned also understands that, if Newco should deem it
necessary to comply with the requirements of the Act, stop transfer instructions
will be given to its transfer agents with respect to the Shares and that there
will be placed on the certificates for the Shares, or any substitutions
therefor, a legend stating in substance:
"The securities represented by this certificate were issued in a
transaction under Rule 145 promulgated under the Securities Act of
1933, as amended (the "Act"), and may be sold, transferred or
otherwise disposed of only upon receipt by the Corporation of an
opinion of counsel acceptable to it that the securities are being sold
in compliance with the limitations of Rule 145 or that some other
exemption from registration under the Act is available, or pursuant to
a registration statement under the Act."
Execution of this letter shall not be considered an admission on the
part of the undersigned that the undersigned is an "affiliate" of Dynegy or
Illinova for purposes of Rule 145 under the Act or as a waiver of any rights the
undersigned may have to any claim that the undersigned is not such an affiliate
on or after the date of this letter.
Very truly yours,
/s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx,
Senior Vice President, Legal
& General Counsel
