Exxibit 10.31
PREFERRED INTEREST AMENDMENT AGREEMENT
     This Preferred Interest Amendment Agreement (this “Amendment”) is made as
of this 19th day of December, 2008 among NRG Common Stock Finance I LLC, a
Delaware limited liability company (“Issuer”), Credit Suisse Capital LLC
(together with its successor and assigns, “Purchaser”) and Credit Suisse
Securities (USA) LLC (“Agent”), solely in its capacity as agent for Purchaser
and Issuer (Issuer, Purchaser and Agent, collectively, the “Parties”).
W I T N E S S E T H
     WHEREAS, the Parties have heretofore entered into a Preferred Interest
Purchase Agreement dated August 4, 2006 (the “Preferred Interest Purchase
Agreement”), whereby Issuer issued to Purchaser Issuer’s Series 1 Limited
Liability Company Preferred Interests (the “Preferred Interests”) on the terms
and conditions set forth therein;
     WHEREAS, the Parties have heretofore entered into an Amendment Agreement
dated as of February 27, 2008 relating to the Preferred Interest Purchase
Agreement (the “First Amendment Agreement”) and a Preferred Interest Amendment
Agreement dated as of August 8, 2008 relating to the Preferred Interest Purchase
Agreement (the “Second Amendment Agreement”) (and, for the avoidance of doubt,
references to the Preferred Interest Purchase Agreement herein shall mean the
Preferred Interest Purchase Agreement as modified or amended by such First
Amendment Agreement and such Second Amendment Agreement);
     WHEREAS, the Preferred Interests originally had the terms and provisions
contained in a Certificate of Designations dated as of August 4, 2006 (the
“Certificate of Designations”);
     WHEREAS, the terms and provisions of the Preferred Interests have
heretofore been modified or amended in a First Certificate of Amendment relating
to the Certificate of Designations executed on the Effective Date as defined in
the First Amendment Agreement (the “First Certificate of Amendment”) and a
Second Certificate of Amendment relating to the Certificate of Designations
executed on the Effective Date as defined in the Second Amendment Agreement (the
“Second Certificate of Amendment”) (and, for the avoidance of doubt, references
to the Certificate of Designations herein shall mean the Certificate of
Designations as modified or amended by such First Certificate of Amendment and
such Second Certificate of Amendment);
     WHEREAS, the Parties hereto desire to further amend the terms and
provisions of the Preferred Interests as set forth herein;

 

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     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 . Defined Terms; References. Unless otherwise specifically
defined herein, each capitalized term used herein and not otherwise defined
herein has the meaning assigned to such term in the Preferred Interest Purchase
Agreement. Each reference to “hereof”, “hereunder”, “herein” and “hereby” and
each other similar reference and each reference to “this Preferred Interest
Purchase Agreement” and each other similar reference contained in the Preferred
Interest Purchase Agreement shall, after this Amendment becomes effective, refer
to the Preferred Interest Purchase Agreement as amended hereby.
     SECTION 2 . Amendments. The Preferred Interests are hereby amended as set
forth in Exhibit B hereto, with such amendments taking effect as of the date
hereof and subject to the further conditions that (1) as of such date Purchaser
shall have received an opinion (in form and substance satisfactory to Purchaser
and its counsel), dated as of the date hereof, of Kirkland & Ellis LLP, counsel
for Issuer, substantially in the form attached hereto as Exhibit A and (2) the
Agreement with respect to the Preferred Interest Purchase Agreement among
Issuer, Purchaser, Agent and the Company of even date herewith has been executed
by the parties thereto. The Issuer shall execute on the date hereof an amendment
to the Certificate of Designations substantially in the form of Exhibit B
hereto.
     SECTION 3 . Representations, Warranties and Agreements.
     (a) Issuer and Purchaser each represents and warrants to the other that its
representations and warranties contained in Sections 4 and 5, respectively, of
the Preferred Interest Purchase Agreement are true and correct on the date
hereof as if made on the date hereof.
     (b) Issuer represents and warrants to and for the benefit of, and agrees
with, Purchaser as follows:
     (i) it has the power to execute this Amendment, to deliver this Amendment
and to perform its obligations under this Amendment and has taken all necessary
action to authorize such execution, delivery and performance;
     (ii) such execution, delivery and performance do not violate or conflict
with any law applicable to it, any provision of its constitutional documents,
any order or judgment of any court or other agency of government applicable to
it or any of its assets or any contractual restriction binding on or affecting
it or any of its assets;
     (iii) all governmental and other consents that are required to have been
obtained by it with respect to the execution and delivery of and

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the performance of its obligations under this Amendment have been obtained and
are in full force and effect and all conditions of any such consents have been
complied with;
     (iv) its obligations under this Amendment constitute its legal, valid and
binding obligations, enforceable in accordance with their respective terms,
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors’ rights generally and to general equitable principles;
     (v) no Early Redemption Event with respect to it has occurred and is
continuing and no such event or circumstance would reasonably be expected to
occur as a result of its entering into or performing its obligations under this
Amendment;
     (vi) there is not pending or, to its knowledge, threatened against it or
any of its affiliates any action, suit or proceeding at law or in equity or
before any court, tribunal, governmental body, agency or official or any
arbitrator that is likely to affect the legality, validity or enforceability
against it of this Amendment or its ability to perform its obligations under
this Amendment;
     (vii) it is acting for its own account, and has made its own independent
decision to enter into this Amendment and as to whether this Amendment is
appropriate or proper for it based upon its own judgment and upon advice of such
advisors as it deems necessary; Issuer acknowledges and agrees that it is not
relying, and has not relied, upon any communication (written or oral) of
Purchaser or any Affiliate of Purchaser with respect to the legal, accounting,
tax or other implications of this Amendment and that it has conducted its own
analyses of the legal, accounting, tax and other implications hereof (it being
understood that information and explanations related to the terms and conditions
of this Amendment shall not be considered investment advice or a recommendation
to enter into this Amendment); it further acknowledges and confirms that it has
taken independent tax advice with respect to this Amendment;
     (viii) it is entering into this Amendment with a full understanding of all
of the terms and risks hereof (economic and otherwise) and is capable of
evaluating and understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms, conditions and
risks; it is also capable of assuming (financially and otherwise), and assumes,
those risks;
     (ix) it acknowledges that neither Purchaser nor any Affiliate of Purchaser
is acting as a fiduciary for or an advisor to Issuer in respect of this
Amendment;

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     (x) it is not entering into this Amendment to create actual or apparent
trading activity in the NRG Common Stock (or any security convertible into or
exchangeable for NRG Common Stock) or to manipulate the price of the NRG Common
Stock (or any security convertible into or exchangeable for NRG Common Stock) or
otherwise in violation of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”);
     (xi) without limiting the generality of Section 3(b)(ii), this Amendment
will not violate Rule 13e-1 or Rule 13e-4 under the Exchange Act; and
     (xii) it is not, and after giving effect to the transactions contemplated
hereby will not be, required to register as an “investment company” as such term
is defined in the Investment Company Act of 1940, as amended.
     (c) Purchaser represents and warrants to and for the benefit of, and agrees
with, Issuer as follows:
     (i) it has the power to execute this Amendment, to deliver this Amendment
and to perform its obligations under this Amendment and has taken all necessary
action to authorize such execution, delivery and performance;
     (ii) such execution, delivery and performance do not violate or conflict
with any law applicable to it, any provision of its constitutional documents,
any order or judgment of any court or other agency of government applicable to
it or any of its assets or any contractual restriction binding on or affecting
it or any of its assets;
     (iii) all governmental and other consents that are required to have been
obtained by it with respect to this Amendment have been obtained and are in full
force and effect and all conditions of any such consents have been complied
with; and
     (iv) its obligations under this Amendment constitute its legal, valid and
binding obligations, enforceable in accordance with their respective terms,
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors’ rights generally and to general equitable principles.
     SECTION 4 . Counterparts. This Amendment may be signed in counterparts,
each of which shall be an original and all of which together shall constitute
one and the same instrument.

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     SECTION 5 . Governing Law; Jurisdiction. THIS AMENDMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
     SECTION 6 . Preferred Interest Purchase Agreement. Except as otherwise
specified in this Amendment, the Preferred Interest Purchase Agreement shall
remain in full force and effect.

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     IN WITNESS WHEREOF, this Amendment has been executed as of the date first
written above.

                  ISSUER:    
 
                NRG COMMON STOCK FINANCE I LLC      
 
  By:
Name:   /s/ Christopher Sotos
 
Christopher Sotos    
 
  Title:   Vice President and Treasurer    
 
                PURCHASER:    
 
                CREDIT SUISSE CAPITAL LLC    
 
           
 
  By:
Name:   /s/ Barry Dixon
 
Barry Dixon    
 
  Title:   Authorized Signatory    
 
           
 
  By:
Name:   /s/ Shui Wong
 
Shui Wong    
 
  Title:   Authorized Signatory    
 
                AGENT:    
 
                CREDIT SUISSE SECURITIES (USA) LLC    
 
           
 
  By:
Name:   /s/ Barry Dixon
 
Barry Dixon    
 
  Title:   Authorized Signatory    

 

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Exhibit A
Form of Opinion

A-1

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Exhibit B
NRG COMMON STOCK FINANCE I LLC
THIRD CERTIFICATE OF AMENDMENT
to
CERTIFICATE OF DESIGNATIONS
establishing the
Voting Powers, Designations, Preferences, Limitations,
Restrictions, and Relative Rights of
Series 1 Limited Liability Company Preferred Interests
 

Pursuant to Section 18-215 of the
Limited Liability Company Act of the State of Delaware

 

 

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     NRG COMMON STOCK FINANCE I LLC, a limited liability company organized and
existing under the Limited Liability Company Act of the State of Delaware
(“Issuer”), does hereby certify as follows:
     1. That the Certificate of Designations establishing the voting powers,
designations, preferences, limitations, restrictions, and relative rights of the
Series 1 Limited Liability Company Preferred Interests, as amended by the Third
Certificate of Amendment (as defined below) (as so amended, the “Certificate of
Designations”), shall be further amended as follows:
     (a) Section 4.5 of the Certificate of Designations shall be deleted in its
entirety and replaced with the following new Section 4.5:
     Increased Cost of Stock Borrow.  The Calculation Agent may increase the
Accretion Rate for any Preferred Interest to account for any period in which it
reasonably determines that an Increased Cost of Stock Borrow exists in respect
of such Preferred Interest.
     (b) Section 10.29 of the Certificate of Designations shall be amended by
deleting the phrase “or an Increased Cost of Hedging” in item (i) of the
definition of “Extraordinary Event” and replacing it with “or an Increased Cost
of Stock Borrow.”
     (c) Section 10 of the Certificate of Designations shall be amended by the
addition of Section 10.38(A) as follows:
     “Increased Cost of Stock Borrow” means, in respect of any Preferred
Interest, an Increased Cost of Hedging (or portion thereof) resulting from the
rate that the Holder of such Preferred Interest or its affiliate would incur to
borrow NRG Common Stock.
     (d) Section 10 of the Certificate of Designations shall be amended by the
addition of Section 10.60(A) as follows:
     “Other Increased Cost of Hedging” means any Increased Cost of Hedging (or
portion thereof) that is not an Increased Cost of Stock Borrow.
     (e) Section 10 of the Certificate of Designations shall be amended by the
addition of Section 10.79(A) as follows:
     “Third Certificate of Amendment” means the NRG Common Stock Finance I LLC
Third Certificate of Amendment to Certificate of Designations establishing the
Voting Powers, Designations, Preferences, Limitations, Restrictions and Relative
Rights of Series 1 Limited Liability Company Preferred Interests executed as of
December 19, 2008.

B-1

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     “Third Note Purchase Amendment Agreement” means the Note Purchase Amendment
Agreement dated as of December 19, 2008 among Issuer, Credit Suisse
International and Credit Suisse Securities (USA) LLC, as agent.
     “Third Preferred Interest Amendment Agreement” means the Preferred Interest
Amendment Agreement dated as of December 19, 2008 among Issuer, Credit Suisse
Capital LLC and Credit Suisse Securities (USA) LLC, as agent.
     (f) Section 10.82(B) of the Certificate of Designations shall be deleted in
its entirety replaced with the following new Section 10.82(B):
     “Transaction Amendment Documents” means (i) the Preferred Interest
Amendment Agreement, (ii) the Note Purchase Amendment Agreement, (iii) the First
Certificate of Amendment, (iv) Underwriting Agreement No. 2, (v) the Amendment
Fee Agreement, (vi) the Second Preferred Interest Amendment Agreement, (vii) the
Second Note Purchase Amendment Agreement, (viii) the Second Certificate of
Amendment, (ix) the Third Preferred Interest Amendment Agreement, (x) the Third
Note Purchase Amendment Agreement and (xi) the Third Certificate of Amendment.
     (g) Section 10.83 of the Certificate of Designations shall be amended by
deleting “and” in subclause (xiii) thereof and deleting the phrase “as each
document or agreement in subclauses (i) through (xiv) of this Section 10.83 may
be amended from time to time” in the last line thereof after the word
“Agreement” and adding the phrase “; and (xv) the Agreement with respect to the
Preferred Interest Purchase Agreement dated as of December 19, 2008 among
Issuer, Credit Suisse Capital LLC as Purchaser, Credit Suisse Securities
(USA) LLC as Agent and the Company, as each document or agreement in subclauses
(i) through (xv) of this Section 10.83 may be amended from time to time” in the
last line thereof after the word “Agreement.”
     2. Except as otherwise specified in this Third Certificate of Amendment to
the Certificate of Designations, the Certificate of Designations shall remain in
full force and effect.

B-2

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     IN WITNESS WHEREOF, NRG Common Stock Finance I LLC caused this Third
Certificate of Amendment of the Certificate of Designation to be signed this day
of December, 2008.

            NRG COMMON STOCK FINANCE I LLC
      By:           Name:   Christopher Sotos        Title:   Vice President and
Treasurer