* Waiver preserves Icahn's rights under Delaware law
* Icahn can buy up to 19.99999 pct
NEW YORK, March 9 Billionaire investor Carl
Icahn on Wednesday said he signed an agreement with power
company Dynegy Inc (DYN.N) that would allow him to buy up to
19.99999 percent of the company while retaining his voting
Dynegy's shareholders recently rejected a $665 million
buyout deal floated by Icahn. That $5.50-a-share bid came under
fire from hedge fund Seneca Inc, Dynegy's second-largest
shareholder, which believes the company has more value.
According to a filing with the Securities and Exchange
Commission, Icahn and Dynegy agreed to a waiver of section 203
of Delaware's corporate law, which would otherwise prevent
Icahn from voting his shares in favor of any new deal he puts
together for Dynegy for a three year period.
Icahn has suggested he is willing to provide the company
with debt or equity financing.
Dynegy shares fell 3 percent on Wednesday as investors
shrugged off a warning that the power company could seek
bankruptcy protection if it is unable to amend or replace its
existing loan facility. [ID:nN09264105]
(Reporting by Michael Erman; Editing by Bernard Orr)