Dynegy (DYN)

Customer Risk Management Business

          EBITDA for the Customer Risk Management segment totaled $29 million in 2007, compared to EBITDA of $34 million in 2006. 2007 results included a $31 million gain associated with the acquisition of the Kendall facility. Upon the completion of the LS Power merger, the Kendall facility’s power tolling contract with the company’s CRM segment became an intercompany agreement.

          Results for 2007 and 2006 also included income from discontinued operations of $15 million and $23 million, respectively, primarily related to the favorable settlement of a legacy receivable, offset by legal and settlement charges of approximately $15 million and $53 million, respectively.

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Customer Risk Management Business

EBITDA for the Customer Risk Management (CRM) business totaled $34 million during 2006, compared to a $640 million loss before interest, taxes and depreciation and amortization in 2005. 2006 results primarily benefited from mark-to-market gains on legacy trading positions and earnings related to the release of a bad debt reserve against a receivable that was previously assessed as uncollectible. This income was partially offset by $53 million of pre-tax legal and settlement charges, which are reflected in consolidated general and administrative expenses for 2006.

The 2005 loss included pre-tax charges of $364 million and $169 million, respectively, related to agreements to terminate the Sterlington power tolling obligation and the Independence toll restructuring associated with the Sithe Energies acquisition. 2005 results also included legal and settlement charges of $38 million, which are reflected in consolidated general and administrative expenses for 2005. Additionally, the

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2005 loss includes payments in excess of realized margins under the Sterlington and Gregory tolling arrangements, which are no longer operative, and mark-to-market losses.