Dynegy Inc. on Friday priced $1.45 billion of second priority senior secured notes as part of its credit refinancing plan, and has scheduled the offering to close August 11. The offering is part of the company’s refinancing overhaul that it announced in July, which would, among other things, begin to repay ChevronTexaco Corp. for a $1.5 billion loan it gave Dynegy to attempt its merger with Enron Corp. in November 2001.

The senior secured offering includes $225 million of second priority senior secured floating rate notes due in 2008; $525 million of 9.875% second priority senior secured notes due in 2010 with a yield to maturity of 10%; and $700 million of 10.125% second priority senior secured notes due in 2013 with a yield to maturity of 10.25%, all to be issued by Dynegy Holdings Inc.

The floating rate notes will be secured by most of the same collateral that secures the obligations under the company’s recently restructured credit facilities, which consist of a substantial portion of the available assets and stock of Dynegy’s direct and indirect subsidiaries, except Illinois Power, its regulated energy delivery business.

Besides the refinancing, Dynegy also has executed stock restructuring plan for its Series B Exchange Agreement with Chevron U.S.A. Inc., a subsidiary of ChevronTexaco, which is a 26.5% shareholder. The Series B exchange is subject to several conditions, including the consummation of the private offerings. A credit facility amendment requires that Dynegy raise at least $1.5 billion through the proposed private offerings before any of the proceeds are used to make a $225 million cash payment to ChevronTexaco under the stock restructuring.

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