Exhibit 10.2

 

GENON ENERGY, INC.

2010 OMNIBUS INCENTIVE PLAN

 

2012 PERFORMANCE UNIT AWARD AGREEMENT

 

To:                             Edward R. Muller

 

Congratulations on your selection as a recipient of performance units
(“Performance Units”) under the GenOn Energy, Inc. (the “Company”) 2010 Omnibus
Incentive Plan (the “Plan”).  The employment agreement between you and the
Company dated April 11, 2010 (the “Employment Agreement”), this Award Agreement
(“Agreement”) and the Plan together govern your rights and set forth all of the
conditions and limitations affecting such rights.

 

Terms used in this Agreement that are defined in the Plan will have the meanings
ascribed to them in the Plan and terms used that are defined in the Employment
Agreement will have the meanings ascribed to them in the Employment Agreement.

 

1.                                      Terms.  Pursuant to the terms and
conditions of the Plan and this Agreement, you have been granted Performance
Units as outlined below:

 

Grant Date:

 

February 27, 2012

 

 

 

Number of Performance Units at Target:

 

511,681

 

Adjustment of Number of Performance Units:  See Schedule I to this Agreement for
the manner in which your target number of Performance Units will be adjusted
based on the short-term incentive (“STI”) performance factor for calendar year
2012.

 

2.                                      Vesting.  Except as provided in Section
3 below and subject to the adjustment described in Schedule 1 to this Agreement,
the Performance Units will vest as follows:

 

33 1/3% of the Performance Units will vest on the date the Committee determines
the 2012 plan year STI performance factor (“Determination Date”);

 

33 1/3 % of the Performance Units will vest on the first anniversary of the
Determination Date; and

 

the remainder of the Performance Units will vest on the second anniversary of
the Determination Date.

 

The performance factor is typically determined during the first quarter of the
fiscal year.

 

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3.                                      Impact of Change in Employment Status.

 

(i)                        Termination Without Cause or for Good Reason, Death,
Disability or Retirement.  In the event your employment with the Company is
terminated (i) by the Company without Cause, (ii) by you for Good Reason or
(iii) as a result of your death, Disability or Retirement, all Performance Units
that have not already vested, as of the date of such termination, shall vest
immediately.  In the event termination under this section occurs prior to the
determination of the performance factor for 2012, the Performance Units will
vest at target.

 

(ii)                    Termination for Cause, Voluntary Resignation Without
Good Reason.  In the event of your termination of employment with the Company
(i) by the Company for Cause or (ii) by reason of your resignation from the
Company for any reason other than for Good Reason (or other than due to your
death, Disability or Retirement), all Performance Units that have not already
vested as of the date of such termination will be forfeited.

 

(iii)                Termination in Connection with a Change in Control.  In the
event your employment with the Company is terminated in connection with a Change
in Control as provided in the Employment Agreement, all Performance Units that
have not already vested as of the date of such termination shall vest
immediately.  In the event termination under this section occurs prior to
determination of the performance factor for 2012, the Performance Units will
vest at target.

 

4.                                      Book Entry Account.  Within a reasonable
time after the date of this Agreement, the Company shall instruct its transfer
agent or stock plan administrator to establish a book entry account representing
the Performance Units in your name effective as of the Grant Date, provided that
the Company shall retain control of such account until the Performance Units
have become vested in accordance with this Agreement and shares of Common Stock
have been issued in settlement of the Performance Units.  The number of
Performance Units credited to your account shall be adjusted as provided in
Schedule I to this Agreement.

 

5.                                    Distribution of Shares.  Consistent with
the provisions of Section 3 of this Award and except as provided in the
following sentence, on the day following your termination of employment with the
Company, you (or in the event of your death or incapacity in connection with a
Disability, your executor, administrator, trustee, guardian or other duly
appointed legal representative, as the case may be) will receive one share of
the Company’s Common Stock, as provided in Section 1 above in satisfaction of
each Performance Unit credited to your account under Section 4 above and vested
either theretofore or by reason of the event resulting in such termination. 
Notwithstanding the foregoing, to the extent required to comply with Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the
applicable regulations and guidance thereunder, any distribution of shares of
Common Stock under this Award shall be delayed to the first day after the
six-month anniversary of your separation from service, as defined in Code
Section 409A and the applicable regulations and guidance thereunder.

 

6.                                      Stockholder Rights; Dividend
Equivalents.  The Performance Units do not confer on you any rights of a
stockholder of the Company unless and until shares of Common Stock are in fact
issued to you in connection with the vested Performance Units.  However, if and
when cash dividends or other cash distributions are paid or distributed with
respect to the Common Stock while the Performance Units are outstanding, the
dollar amount of such dividends or distributions with respect to the number of
shares of Common Stock then underlying the Performance Units shall be reflected
in your account.  Any such cash dividends or other cash distributions shall vest
and be paid in cash if and at such times the underlying Performance Units are
vested and paid.

 

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7.                                      Transferability.  No rights granted
under this Agreement can be assigned or transferred, whether voluntarily or
involuntarily, by operation of law or otherwise, except by will or the laws of
descent and distribution.  In the event of any transfer or assignment of rights
granted under this Agreement in accordance with this Section 7, the person or
persons, if any, to whom such rights are transferred by will or by the laws of
descent and distribution shall be treated after your death the same as you under
this Agreement.  Any attempted transfer or assignment of rights under this
Agreement prohibited under this Section 7 shall be null and void.

 

8.                                      Withholding; Code Section 409A.  The
Company has the right to deduct applicable taxes from any payment under this
Agreement and withhold, at the time the tax and withholding obligation arises,
an appropriate number of shares of Common Stock for payment of required
withholding taxes or to take such other action as may be necessary in the
opinion of the Company to satisfy all obligations for withholding of such taxes.
The Fair Market Value of the shares of Common Stock withheld for payment of
required withholding taxes must equal no more than the required minimum
withholding taxes.  The Performance Units granted under this Agreement are
intended to comply with or be exempt from Code Section 409A, and ambiguous
provisions of this Agreement, if any, shall be construed and interpreted in a
manner consistent with such intent.

 

9.                                      Employment Agreement and Plan
Provisions.  In addition to the terms and conditions set forth herein, this
Award is subject to and governed by the terms and conditions set forth in the
Employment Agreement and in the Plan, which are incorporated herein by
reference.  In the event of any conflict between the provisions of this Award or
the Plan and the Employment Agreement, the Employment Agreement shall control.

 

10.                               Notice.  Any written notice required or
permitted by this Agreement shall be mailed, certified mail (return receipt
requested) or hand-delivered.  Notice to the Company shall be addressed to the
Company’s General Counsel at 1000 Main St., Houston, TX 77002.  Notice to you
shall be addressed to you at your most recent home address on record with the
Company.  Notices are effective upon receipt.

 

11.                               Requirements of Law.  The granting of
Performance Units and the issuance of shares of Common Stock under the Plan will
be subject to all applicable laws, rules, and regulations, and to such approvals
by any governmental agencies or national securities exchanges as may be
required.

 

12.                               Miscellaneous.

 

a.                                      Limitation of Rights.  The granting of
this Award shall not give you any rights to similar grants in future years or
any right to be retained in the employ or service of the Company or its
Subsidiaries or interfere in any way with the right of the Company or any such
Subsidiary to terminate your services at any time, or your right to terminate
your services at any time.

 

b.                                      Severability.  If any term, provision,
covenant or restriction contained in this Agreement is held by a court or a
federal regulatory agency of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions contained in this Agreement shall remain in full force and effect,
and shall in no way be affected, impaired or invalidated.

 

c.                                       Governing Law.  All issues and
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by, and construed in accordance with, the
laws of the State of Delaware.

 

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13.                               Acceptance of Award.  You are deemed to accept
this Award and to agree that it is subject to the terms and conditions set forth
in this Agreement and the Plan unless you provide the Company written
notification not later than 30 days after the Grant Date of your rejection of
this Award (in which case your Award will be forfeited and you shall have no
further right or interest therein as of the Grant Date).

 

 

GENON ENERGY, INC.

 

 

 

 

 

 /s/ Karen D. Taylor

 

Karen D. Taylor

 

Senior Vice President, Human Resources and Administration

 

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SCHEDULE I

 

GENON ENERGY, INC.
2010 OMNIBUS INCENTIVE PLAN

 

2012 PERFORMANCE UNIT AWARD AGREEMENT

 

The Performance Units are adjusted based on the 2012 short-term incentive
(“STI”) performance factor approved by the Compensation Committee. The STI
performance factor as determined for 2012 establishes the multiplier applied to
the total Performance Unit grant.  Payouts may range from 0 to 200 percent of
your target Performance Unit Award.

 

Example:  1000 Performance Units are granted in 2012.  STI performance factor as
determined during the first quarter of 2013 is 120%.

 

1000 Performance Units x 120% = 1,200 units

 

  400 Performance Units vest on the Determination Date in 2013

 

  400 Performance Units vest on the first anniversary of the Determination Date
in 2014

 

  400 Performance Units vest on the second anniversary of the Determination Date
in 2015

 

Vested Performance Units will settle in Company stock.

 

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