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     Subject to and in furtherance of the foregoing, the Guarantor acknowledges that the GuaranteedParty may, in its sole discretion, bring and prosecute a separate action or actions against theGuarantor for the full amount of the Obligations then due and owing pursuant to the terms hereof,regardless of whether any action is brought against Acquisition Sub or whether Acquisition Sub isjoined in any such action or actions.     **2. ****NATURE OF GUARANTEE****.**The Guarantor’s liability hereunder is absolute,unconditional, irrevocable and continuing irrespective, without limitation, of (a) any lack ofvalidity or enforceability of any Guaranteed Agreement or (b) any modification, amendment or waiverof, or any consent to departure from, any Guaranteed Agreement that may be agreed to by AcquisitionSub (even if the Obligations are expanded or extended thereby). Without limiting the foregoing,the Guaranteed Party shall not be obligated to file any claim relating to the Obligations in theevent that Acquisition Sub becomes subject to a bankruptcy, reorganization or similar proceeding,and the failure of the Guaranteed Party to so file shall not affect the Guarantor’s obligationshereunder. In the event that any payment to the Guaranteed Party in respect of the Obligations isrescinded or must otherwise be returned for any reason whatsoever, the Guarantor shall remainliable hereunder with respect to such Obligations as if such payment had not been made. ThisGuarantee is an unconditional and continuing guarantee of payment and performance of theObligations and not of collection of the Obligations.     **3. ****CHANGES IN OBLIGATIONS, CERTAIN WAIVERS****.**          (a) The Guarantor agrees that the Guaranteed Party may at any time and from time to time,without notice to or further consent of the Guarantor, extend the time of payment or performance ofany of the Obligations (provided that any amendment to any Guaranteed Agreement shall be subject tothe written consent of Acquisition Sub), and may also make any agreement with Acquisition Sub forthe extension, renewal, payment, compromise, discharge or release thereof, in whole or in part,without in any way impairing or affecting such Guarantor’s obligations under this Guarantee. TheGuarantor agrees that the obligations of the Guarantor hereunder shall not be released ordischarged, in whole or in part, or otherwise affected by (i) the failure or delay on the part ofthe Guaranteed Party to assert any claim or demand or to enforce any right or remedy againstAcquisition Sub; (ii) any change in the time, place or manner of payment of any of the Obligationsor any rescission, waiver, compromise, consolidation or other amendment or modification of any ofthe terms or provisions of any Guaranteed Agreement that may be agreed to by Acquisition Sub or anyagreement evidencing, securing or otherwise executed in connection with any of the Obligations(even if the Obligations are expanded or extended thereby); (iii) any change in the time, place ormanner of payment of any of the Obligations or any rescission, waiver, compromise, consolidation,forbearance or other similar modification of any of the terms or provisions of any GuaranteedAgreement that may be granted by the Guaranteed Party (even if the Obligations are extendedthereby); (iv) the addition, substitution or release of any entity or other Person interested inthe transactions contemplated by any Guaranteed Agreement; (v) any change in the corporateexistence, structure or ownership of Acquisition Sub or any other Person interested in thetransactions contemplated by any Guaranteed Agreement; (vi) any insolvency, bankruptcy,reorganization or other similar proceeding affecting Acquisition Sub or any other Person interestedin the transactions
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contemplated by any Guaranteed Agreement; (vii) the existence of any claim, set-off or otherright which the Guarantor may have at any time against Acquisition Sub or the Guaranteed Party,whether in connection with the Obligations or otherwise (other than defenses to the payment of theObligations that are available to Acquisition Sub) under any Guaranteed Agreement); (viii) theadequacy of any means the Guaranteed Party may have of obtaining payment or performance related tothe Obligations; (ix) any termination of or change in any relationship between the Guarantor andthe Acquisition Sub, including any such termination or change resulting from a change in theownership of the Guarantor or the Acquisition Sub, or from the cessation of any commercial or legalrelationship between the Guarantor and the Acquisition Sub; (x) any failure to notify the Guarantorof any events or circumstances relating to or arising from the Guaranteed Agreements or (xi) anyother defense relating to the obligations of a surety or guarantor. To the fullest extentpermitted by Law the Guarantor hereby expressly waives any and all rights or defenses arising byreason of any Law which would otherwise require any election of remedies by the Guaranteed Party.The Guarantor waives promptness, diligence, notice of the acceptance of this Guarantee and of theObligations, presentment, demand for payment, notice of non-performance, default, dishonor andprotest, notice of any Obligations incurred and all other notices of any kind (other than noticesexpressly required to be provided to Acquisition Sub pursuant to any Guaranteed Agreement), alldefenses which may be available by virtue of any valuation, stay, moratorium Law or other similarLaw now or hereafter in effect, any right to require the marshalling of assets of Acquisition Subor any other Person interested in the transactions contemplated by any Guaranteed Agreement, andall suretyship defenses generally (other than defenses to the payment of the Obligations that areavailable to Parent or Acquisition Sub under any Guaranteed Agreement). The Guarantor acknowledgesand agrees that it is in a position to monitor the Acquisition Sub’s satisfaction of theObligations, and requires no notification by the Guaranteed Party of any events or circumstancesrelating thereto or arising therefrom. The Guarantor acknowledges that it will receive substantialdirect and indirect benefits from the transactions contemplated by the Guaranteed Agreements andthat the waivers set forth in this Guarantee are knowingly made in contemplation of such benefits.          (b) The Guarantor hereby unconditionally and irrevocably waives any rights that it may nowhave or hereafter acquire against Acquisition Sub that arise from the existence, payment,performance, or enforcement of the Guarantor’s obligations under or in respect of this Guarantee,including, without limitation, any right of subrogation, reimbursement, exoneration, contributionor indemnification and any right to participate in any claim or remedy of the Guaranteed Partyagainst Acquisition Sub or such other Person, whether or not such claim, remedy or right arises inequity or under contract, statute or common Law, including, without limitation, the right to takeor receive from Acquisition Sub or such other Person, directly or indirectly, in cash or otherproperty or by set-off or in any other manner, payment or security on account of such claim, remedyor right, and the Guarantor shall not exercise any such rights unless and until all of theObligations under this Guarantee shall have been paid in full (other than indemnities andcontingent obligations not then due and payable). If any amount shall be paid to the Guarantor inviolation of the immediately preceding sentence at any time prior to the payment in full (otherthan indemnities and contingent obligations not then due and payable) of the Obligations, suchamount shall be received and held in trust for the benefit of the Guaranteed Party, shall besegregated from other property and funds of the Guarantor and shall promptly be
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paid or delivered to the Guaranteed Party to be credited and applied to the Obligations thendue and owing, in accordance with the terms of any Guaranteed Agreement. Notwithstanding anythingto the contrary contained in this Guarantee, the Guaranteed Party hereby agrees that to the extentAcquisition Sub is relieved of all or any portion of its payment obligations under any GuaranteedAgreement by virtue of the payment or satisfaction of such obligations, the Guarantor shall besimilarly relieved of its corresponding Obligations under this Guarantee.     **4. ****NO WAIVER; CUMULATIVE RIGHTS****.**No failure on the part of the Guaranteed Party toexercise, and no delay in exercising, any right, remedy or power hereunder shall operate as awaiver thereof, nor shall any single or partial exercise by the Guaranteed Party of any right,remedy or power hereunder preclude any other or future exercise of any right, remedy or powerhereunder. Each and every right, remedy and power hereby granted to the Guaranteed Party orallowed it by Law or other agreement shall be cumulative and not exclusive of any other, and may beexercised by the Guaranteed Party at any time or from time to time. The Guaranteed Party shall nothave any obligation to proceed at any time or in any manner against, or exhaust any or all of theGuaranteed Party’s rights against Acquisition Sub or any other Person liable for any Obligationsprior to proceeding against the Guarantor hereunder.     **5. ****REPRESENTATIONS AND WARRANTIES****.**The Guarantor hereby represents and warrants that:          (a) the Guarantor has all requisite corporate power and authority to enter into this Guaranteeand to perform its obligations hereunder;          (b) the execution, delivery and performance of this Guarantee by the Guarantor does not, andwill not, violate or result in a breach of any provision of, constitute a default (with or withoutnotice or lapse of time or both) under, result in the termination or modification of, result in aright of termination, cancellation or acceleration of any material obligation or the loss of amaterial benefit under, or result in the creation of any lien or encumbrance upon any of thematerial properties or assets of the Guarantor pursuant to any provisions of (i) the certificate ofincorporation, by-laws or similar governing documents of the Guarantor, (ii) any Law, judgment,decree, order, injunction, writ, permit or license of any Governmental Authority applicable to theGuarantor or any of the Guarantor ‘s Subsidiaries or any of their respective properties or assets,or (iii) any material note, bond, mortgage, indenture, deed of trust, license, franchise, permit,concession, contract, lease or other instrument, obligation or agreement of any kind to which theGuarantor is a party or by which it or any of its properties or assets may be bound, except aswould not reasonably be expected to have a material adverse effect on the enforceability of thisGuarantee;          (c) all consents, approvals, authorizations, permits of, filings with and notifications to,any Governmental Authority or third party necessary for the due execution, delivery and performanceof this Guarantee by the Guarantor have been obtained or made and all conditions thereof have beenduly complied with, and no other action by, and no notice to or filing with, any GovernmentalAuthority or third party is required in connection with the execution, delivery or performance ofthis Guarantee; and
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          (d) this Guarantee has been duly executed and delivered by the Guarantor and constitutes alegal, valid and binding obligation of the Guarantor enforceable against the Guarantor inaccordance with its terms, subject to (i) the effects of bankruptcy, insolvency, fraudulentconveyance, reorganization, moratorium or other similar laws affecting creditors’ rights generally,(ii) general equitable principles (whether considered in a proceeding in equity or at law) and(iii) the discretion of the court in which any matter relevant hereto is litigated.     **6. ****NO ASSIGNMENT****.**Neither the Guarantor nor the Guaranteed Party may assign ordelegate their respective rights, interests or obligations hereunder to any other Person (except byoperation of Law) without the prior written consent of the Guaranteed Party or the Guarantor, asthe case may be; provided, however, that the Guaranteed Party may assign, transfer or pledge itsrights hereunder to any Person for financing purposes.     **7. ****NOTICES****.**All notices, requests, claims, demands and other communications hereundershall be given and shall be deemed to have been duly received (a) upon receipt by hand delivery,(b) upon receipt after dispatch by registered or certified mail, postage prepaid, (c) on the nextBusiness Day if transmitted by national overnight courier with confirmation of delivery, or (d)upon confirmation of delivery if transmitted by facsimile, as follows:          if to the Guarantor:NRG Energy, Inc.