GENERAL ELECTRIC RAILCAR SERVICES CORPORATION
February 18, 2005
Mr. Dirk Cook
Subject: NRG Power Marketing Inc.
The purpose of this letter is to convey a commitment on the part of General Electric Railcar Services Corporation (“GE Railcar”), to (a) acquire approximately 1,500 newly manufactured aluminum coal gondola cars (the “Equipment”) through the assignment by NRG Power Marketing Inc. (“NRG”) of its right to take delivery of the Equipment under the Johnstown American Corporation Proposal Number 04087, Revision 3, dated August 19, 2004 and accepted by NRG August 23, 2004 (the “Purchase Agreement”) between NRG and Johnstown America Corporation (“Seller”) and (b) to lease the Equipment to NRG pursuant to (i) the Railroad Car Full Service Master Leasing Agreement (the “Master Lease”) dated as of February 18, 2005 between GE Railcar and NRG and (ii) one or more Initial Riders between GE Railcar and NRG, each to be executed as to the Equipment specified therein with payment pursuant to the Purchase Agreement to be made as provided for therein (such date of payment is hereinafter referred to as a “Funding Date”). The lease of the Equipment shall be on the terms set forth in the form of Initial Rider (attached hereto as Exhibit A). Capitalized terms used herein without definition have the meanings described to them in the Master Lease.
This commitment is subject to (a) the execution and delivery of the Master Lease, and (b) satisfaction of the conditions precedent set forth in the Master Lease on the date hereof. In addition to the conditions set forth in the Lease Documents, the commitment to enter into each Initial Rider is subject to the conditions set forth in the form of Initial Rider attached hereto as Exhibit A. The Master Lease, the Guaranty, the Purchase Agreement Assignment, and each Initial Rider executed and delivered by the parties are collectively referred to as the “Lease Documents.” In addition to the conditions set forth in the Lease Documents, the commitment to make the payment due on any Funding Date is subject to the delivery and acceptance of the related Equipment on or prior to September 30, 2005.
GE Railcar’s commitment is based upon the foregoing and the terms and conditions set forth in the Master Lease and the form of Initial Rider. By execution and delivery of this letter to GE Railcar, NRG commits to lease the Equipment from GE Railcar upon the terms, and subject to
the conditions, set forth in the Lease Documents. If this agreement is acceptable, please indicate your acceptance by signing in the space below and returning one originally executed commitment to the undersigned. This agreement shall be governed by and construed in accordance with the laws of the State of Illinois without regard to its conflicts of laws.
General Electric Railcar Services Corporation
If this agreement is acceptable, please indicate your acceptance by signing in the space below and returning one originally executed commitment to the undersigned
If this agreement is acceptable, please indicate your acceptance by signing in the space below and returning one originally executed commitment to the undersigned.
Accepted & Agreed:
NRG Power Marketing Inc.
EXHIBIT A TO COMMITMENT LETTER
General Electric Railcar Services
Pursuant to the terms of that certain Purchase Agreement Assignment, Lessor has agreed to purchase and lease to Lessee up to 1500 Cars for an aggregate Capitalized Lessor’s Cost of up to $94,447,276 pursuant to one or more Riders (collectively, the “Initial Riders”). The Delivery Dates for such Initial Riders shall occur on the dates as the parties may agree, but unless otherwise agreed by the parties (i) each Rider shall relate to one Train Set, (ii) the last Delivery Date shall occur no later than September 30, 2005 and (iii) the monthly rental is to be $465.00 per Car, subject to a one-time adjustment pursuant to Section 4.B of the Master Lease. In no event shall the aggregate Capitalized Lessor’s Cost with respect to all of the Cars to be leased under the Initial Riders exceed the amount of $94,447,276.
Capitalized Lessor’s Cost : [ ] [to include applicable sales tax amounts].
Past Due Rate : The rate equal to the lower of (i) the Deutsche Bank Prime Rate plus 2.0% and (ii) the maximum rate permitted under applicable law.
Stipulated Loss Value : As set forth in Schedule I to this Rider.
Lease Term Commencement Date : October 1, 2005
Lease Term Expiration Date : September 30, 2015.
The lease of the Cars pursuant to this Rider shall commence on the date of this Rider upon satisfaction of the conditions set forth in Section 15B of the Master Lease.
Lessee’s obligation to pay rent under this Rider with respect to each of the Cars will be deemed to have terminated on the later of the expiration date of this Rider or the day after the respective Car arrives at a location within 100 miles of the BNSF route running from the Powder River Basin to Chicago, Illinois or St. Louis, Missouri or as otherwise agreed between Lessor and Lessee. For the avoidance of doubt, all Cars leased pursuant to this Rider will be returned to a single location.