AGREEMENT
WITH RESPECT TO
THE NOTE PURCHASE AGREEMENT
This
Agreement with respect to the Note Purchase Agreement (this “
Agreement ”) is made as of this 19th day of December,
2008 among NRG Common Stock Finance I LLC, a Delaware limited
liability company (“ Issuer ”), NRG Energy,
Inc., a Delaware corporation (the “ Company ”),
Credit Suisse International (together with its successor and
assigns, “ Purchaser ”) and Credit Suisse
Securities (USA) LLC (“ Agent ”), solely in
its capacity as agent for Purchaser and Issuer.
WHEREAS,
Issuer, Purchaser and Agent are party to the Note Purchase
Agreement dated August 4, 2006 (the “ Note Purchase
Agreement ”), whereby Issuer agreed to sell and Purchaser
agreed to purchase Issuer’s promissory notes on the terms and
conditions set forth therein;
WHEREAS,
Issuer, Purchaser and Agent have heretofore entered into an
Agreement with respect to the Note Purchase Agreement dated as of
September 8, 2006, an Amendment Agreement dated as of
February 27, 2008 relating to the Note Purchase Agreement (the
“ First Amendment Agreement ”), a Note Purchase
Amendment Agreement dated as of August 8, 2008 relating to the
Note Purchase Agreement (the “ Second Amendment
Agreement ”) and a Note Purchase Amendment Agreement
dated as of December 19, 2008 relating to the Note Purchase
Agreement (the “ Third Amendment Agreement ”)
(and, for the avoidance of doubt, references to the Note Purchase
Agreement herein shall mean the Note Purchase Agreement as modified
or amended by such Agreement with respect to the Note Purchase
Agreement, such First Amendment Agreement, such Second Amendment
Agreement and such Third Amendment Agreement);
WHEREAS,
Issuer and Purchaser wish to effect certain transactions in
connection with the Note Purchase Agreement on the terms and
conditions set forth herein;
NOW,
THEREFORE, in consideration of their mutual covenants herein
contained, the parties hereto, intending to be legally bound,
hereby mutually covenant and agree as follows:
SECTION
1 . Definitions. As used herein, capitalized terms not
defined herein shall have the meaning ascribed to them in, or as
provided in, the Note Purchase Agreement.
SECTION
2. Notice of Increased Costs . (a) Purchaser shall
provide notice (an “ Increased Costs Notice ”)
to Issuer following the end of each calendar month during which an
Increased Cost of Stock Borrow, Increased Cost or Other Increased
Cost of Hedging in respect of the Notes occurred or was continuing
of
the
amount in U.S. dollars of each such Increased Cost of Stock Borrow,
Increased Cost and/or Other Increased Cost of Hedging for such
month. Such Increased Costs Notice shall specify the nature
and amount of the Increased Cost of Stock Borrow, Increased Cost
and/or Other Increased Cost of Hedging and shall provide a
reasonably detailed basis for the determination thereof. In
addition, in respect of any Increased Cost of Stock Borrow
specified in such Increased Costs Notice, Purchaser shall provide
notice of (i) the increase to the Accretion Rate for any Note
that the Calculation Agent would apply pursuant to Section 15
of the Note Purchase Agreement to account for such Increased Cost
of Stock Borrow (the “ Accretion Rate Adjustment
”) and (ii) an amount of cash in U.S. dollars (the
“ Increased Cost of Stock Borrow Amount ”)
relating to such Increased Cost of Stock Borrow that Issuer may
elect to pay in lieu of such Accretion Rate Adjustment.
Purchaser shall respond in good faith to good faith inquiries or
disputes from Issuer regarding the Increased Cost of Stock Borrow,
Accretion Rate Adjustment, Increased Cost and/or Other Increased
Cost of Hedging set forth in an Increased Costs Notice.
Notwithstanding the foregoing, Issuer may, in its reasonable
judgment, designate as an Increased Cost of Stock Borrow or an
Other Increased Cost of Hedging, as the case may be, any amount or
portion thereof specified by Purchaser as an Other Increased Cost
of Hedging or an Increased Cost of Stock Borrow in such Increased
Costs Notice that Issuer reasonably believes should more properly
have been characterized as an Increased Cost of Stock Borrow or an
Other Increased Cost of Hedging, as the case may be, by providing
notice to Purchaser of such designation by 5:00 PM, New York City
time, on the second Business Day immediately following the date of
the relevant Increased Costs Notice (such time on such Business
Day, the “ Notice Deadline ”), in which case
such Other Increased Cost of Hedging or Increased Cost of Stock
Borrow shall be considered an Increased Cost of Stock Borrow or an
Other Increased Cost of Hedging, as the case may be, for purposes
of this Agreement.
(b) By
5:00 PM, New York City time, on the third Business Day immediately
following the date of each Increased Costs Notice, Issuer shall
(i) if Issuer so elects pursuant to Section 2(a), pay the
Increased Cost of Stock Borrow Amount in immediately available
funds by wire transfer to an account designated by Purchaser and
(ii) either (A) pay the aggregate amount of any Increased
Cost and/or Other Increased Cost of Hedging specified in such
Increased Costs Notice (such amount, the “ Other Increased
Cost Amount ”) in immediately available funds by wire
transfer to an account designated by Purchaser or (B) subject
to satisfaction of the conditions set forth in Section 3, in
lieu of paying the Other Increased Cost Amount in cash, deliver
shares of NRG Common Stock (“ Delivered Shares
”) to Purchaser pursuant to Section 3. For the
avoidance of doubt, if Issuer pays the Increased Cost of Stock
Borrow Amount as set forth in this Section 2(b), then the
Accretion Rate Adjustment described in such Increased Costs Notice
shall not take effect, and if Issuer does not make such payment by
the time required, then such Accretion Rate Adjustment shall be
effective on the terms set forth in such Increased Costs
Notice. The parties also acknowledge, for the avoidance of
doubt, that the terms of the Notes do not provide for
any
2
adjustment
to the Accretion Rate in respect of an Increased Cost or an Other
Increased Cost of Hedging.
SECTION
3 . Delivery of Shares . If Issuer elects in connection with
any Increased Costs Notice to deliver Delivered Shares in lieu of
paying the Other Increased Cost Amount in cash, then the following
provisions apply.
(a) Issuer
may elect to deliver Delivered Shares in lieu of paying the Other
Increased Cost Amount in cash only if Issuer notifies Purchaser of
its irrevocable election to do so by the Notice Deadline and all
Delivered Shares are, at the time of such delivery, covered by an
effective registration statement of the Company for immediate
resale by Purchaser (such registration statement, including the
related prospectus, the “ Registration Statement
”) in form and content commercially reasonably satisfactory
to Purchaser, and:
(i)
Purchaser (or an affiliate of Purchaser designated by Purchaser)
shall have been afforded a reasonable opportunity to conduct a due
diligence investigation with respect to the Company that is
customary in scope for underwritten offerings of equity securities
and that yields results that are commercially reasonably
satisfactory to Purchaser or such affiliate, as the case may be, in
its discretion; and
(ii)
Purchaser (or an affiliate o
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