EX-10.2



 





EXHIBIT 10.2




EXECUTION COPY




 





CREDIT AGREEMENT




dated as of June 8, 2007




among




NRG HOLDINGS, INC.,

as Borrower,




THE LENDERS PARTY HERETO,




CREDIT SUISSE SECURITIES (USA) LLC




and




CITIGROUP GLOBAL MARKETS INC.,

as Joint Book Runners and Joint Lead Arrangers,




CREDIT SUISSE,

as Administrative Agent and Collateral Agent,




and




CITIGROUP GLOBAL MARKETS INC.,

as Syndication Agent




 






 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	PAGE
	ARTICLE I.
	 	 	 	 
	 
	 	 	 	 
	Definitions
	 	 	 	 
	 
	 	 	 	 
	SECTION 1.01. Defined Terms
	 	 	1	 
	SECTION 1.02. Terms Generally
	 	 	47	 
	SECTION 1.03. Classification of Term Loans and Borrowings
	 	 	48	 
	SECTION 1.04. Pro Forma Calculations
	 	 	48	 
	SECTION 1.05. Exchange Rates
	 	 	48	 
	 
	 	 	 	 
	ARTICLE II.
	 	 	 	 
	 
	 	 	 	 
	The Credits
	 	 	 	 
	 
	 	 	 	 
	SECTION 2.01. Commitments
	 	 	48	 
	SECTION 2.02. Term Loans
	 	 	48	 
	SECTION 2.03. Borrowing Procedure
	 	 	49	 
	SECTION 2.04. Repayment of Term Loans; Evidence of Debt
	 	 	50	 
	SECTION 2.05. Fees
	 	 	50	 
	SECTION 2.06. Interest on Term Loans
	 	 	51	 
	SECTION 2.07. Default Interest
	 	 	51	 
	SECTION 2.08. Alternate Rate of Interest
	 	 	51	 
	SECTION 2.09. Termination and Reduction of Commitments
	 	 	51	 
	SECTION 2.10. Conversion and Continuation of Borrowings
	 	 	52	 
	SECTION 2.11. Repayment of Term Borrowings
	 	 	53	 
	SECTION 2.12. Prepayment
	 	 	53	 
	SECTION 2.13. Mandatory Prepayments
	 	 	54	 
	SECTION 2.14. Reserve Requirements; Change in Circumstances
	 	 	56	 
	SECTION 2.15. Change in Legality
	 	 	57	 
	SECTION 2.16. Indemnity
	 	 	58	 
	SECTION 2.17. Pro Rata Treatment
	 	 	59	 
	SECTION 2.18. Sharing of Setoffs
	 	 	59	 
	SECTION 2.19. Payments
	 	 	59	 
	SECTION 2.20. Taxes
	 	 	60	 
	SECTION 2.21. Assignment of Commitments Under Certain Circumstances; Duty to Mitigate
	 	 	61	 
	 
	 	 	 	 
	ARTICLE III.
	 	 	 	 
	 
	 	 	 	 
	Representations and Warranties
	 	 	 	 
	 
	 	 	 	 
	SECTION 3.01. Organization; Powers
	 	 	62	 
	SECTION 3.02. Authorization; No Conflicts
	 	 	63	 






 









 






	 	 	 	 	 
	 	 	PAGE
	SECTION 3.03. Enforceability
	 	 	63	 
	SECTION 3.04. Governmental Approvals
	 	 	63	 
	SECTION 3.05. Financial Statements
	 	 	63	 
	SECTION 3.06. No Material Adverse Change
	 	 	64	 
	SECTION 3.07. Title to Properties; Possession Under Leases
	 	 	64	 
	SECTION 3.08. Subsidiaries
	 	 	64	 
	SECTION 3.09. Litigation; Compliance with Laws
	 	 	64	 
	SECTION 3.10. Agreements
	 	 	65	 
	SECTION 3.11. Federal Reserve Regulations
	 	 	65	 
	SECTION 3.12. Investment Company Act
	 	 	65	 
	SECTION 3.13. Use of Proceeds
	 	 	65	 
	SECTION 3.14. Tax Returns
	 	 	65	 
	SECTION 3.15. No Material Misstatements
	 	 	66	 
	SECTION 3.16. Employee Benefit Plans
	 	 	66	 
	SECTION 3.17. Environmental Matters
	 	 	66	 
	SECTION 3.18. Insurance
	 	 	67	 
	SECTION 3.19. Security Documents
	 	 	67	 
	SECTION 3.20. [Reserved]
	 	 	68	 
	SECTION 3.21. Labor Matters
	 	 	68	 
	SECTION 3.22. Intellectual Property
	 	 	68	 
	SECTION 3.23. Energy Regulation
	 	 	69	 
	SECTION 3.24. Solvency
	 	 	70	 
	 
	 	 	 	 
	ARTICLE IV.
	 	 	 	 
	 
	 	 	 	 
	Conditions of Lending
	 	 	 	 
	 
	 	 	 	 
	SECTION 4.01. Conditions Precedent to Closing Date
	 	 	70	 
	SECTION 4.02. Conditions Precedent to Funding Date
	 	 	72	 
	 
	 	 	 	 
	ARTICLE V.
	 	 	 	 
	 
	 	 	 	 
	Affirmative Covenants
	 	 	 	 
	 
	 	 	 	 
	SECTION 5.01. Corporate Existence
	 	 	74	 
	SECTION 5.02. Insurance
	 	 	74	 
	SECTION 5.03. Taxes
	 	 	74	 
	SECTION
5.04. Financial Statements, Reports, etc.
	 	 	74	 
	SECTION 5.05. Litigation and Other Notices
	 	 	76	 
	SECTION 5.06. Information Regarding Collateral
	 	 	76	 
	SECTION 5.07. Maintaining Records; Access to Properties and Inspections
	 	 	76	 
	SECTION 5.08. Use of Proceeds
	 	 	78	 
	SECTION
5.09. Additional Collateral, etc.
	 	 	78	 
	SECTION 5.10. Further Assurances
	 	 	79	 






ii









 






	 	 	 	 	 
	 	 	PAGE
	SECTION 5.11. Change of Control
	 	 	80	 
	 
	 	 	 	 
	ARTICLE VI.
	 	 	 	 
	 
	 	 	 	 
	Negative Covenants
	 	 	 	 
	 
	 	 	 	 
	SECTION 6.01. Indebtedness and Preferred Stock
	 	 	80	 
	SECTION 6.02. Liens
	 	 	84	 
	SECTION 6.03. Limitation on Sale and Leaseback Transactions
	 	 	84	 
	SECTION 6.04. Mergers, Consolidations and Sales of Assets
	 	 	84	 
	SECTION 6.05. Limitation on Investments
	 	 	86	 
	SECTION 6.06. Limitation on Dividends
	 	 	88	 
	SECTION 6.07. Limitations on Debt Payments; Restrictive Agreements
	 	 	89	 
	SECTION 6.08. Transactions with Affiliates
	 	 	92	 
	SECTION 6.09. Business Activities
	 	 	94	 
	SECTION 6.10. Other Indebtedness and Agreements
	 	 	94	 
	SECTION 6.11. Designation of Restricted and Unrestricted Subsidiaries and Excluded Subsidiaries
	 	 	94	 
	SECTION 6.12. [Reserved]
	 	 	95	 
	SECTION 6.13. [Reserved]
	 	 	95	 
	SECTION 6.14. [Reserved]
	 	 	95	 
	SECTION 6.15. Fiscal Year
	 	 	95	 
	 
	 	 	 	 
	ARTICLE VII.
	 	 	 	 
	 
	 	 	 	 
	Events of Default
	 	 	 	 
	 
	 	 	 	 
	ARTICLE VIII.
	 	 	 	 
	 
	 	 	 	 
	The Agents and the Arrangers
	 	 	 	 
	 
	 	 	 	 
	ARTICLE IX.
	 	 	 	 
	 
	 	 	 	 
	Miscellaneous
	 	 	 	 
	 
	 	 	 	 
	SECTION 9.01. Notices
	 	 	100	 
	SECTION 9.02. Survival of Agreement
	 	 	100	 
	SECTION 9.03. Binding Effect
	 	 	101	 
	SECTION 9.04. Successors and Assigns
	 	 	101	 
	SECTION 9.05. Expenses; Indemnity
	 	 	104	 
	SECTION 9.06. Right of Setoff
	 	 	105	 
	SECTION 9.07. Applicable Law
	 	 	105	 
	SECTION 9.08. Waivers; Amendment; Replacement of Non-Consenting Lenders
	 	 	106	 
	SECTION 9.09. Interest Rate Limitation
	 	 	107	 






iii









 






	 	 	 	 	 
	 	 	PAGE
	SECTION 9.10. Entire Agreement
	 	 	107	 
	SECTION 9.11. WAIVER OF JURY TRIAL
	 	 	107	 
	SECTION 9.12. Severability
	 	 	107	 
	SECTION 9.13. Counterparts
	 	 	108	 
	SECTION 9.14. Headings
	 	 	108	 
	SECTION 9.15. Jurisdiction; Consent to Service of Process
	 	 	108	 
	SECTION 9.16. Confidentiality
	 	 	108	 
	SECTION 9.17. Delivery of Lender Addenda
	 	 	109	 
	SECTION 9.18. Holdings Reorganization
	 	 	109	 






Exhibits and Schedules




	 	 	 
	Exhibit A

	 	Form of Administrative Questionnaire
	Exhibit B

	 	Form of Affiliate Subordination Agreement
	Exhibit C

	 	Form of Assignment and Acceptance
	Exhibit D

	 	Form of Borrowing Request
	Exhibit E

	 	Form of Collateral Agreement
	Exhibit F

	 	Form of Lender Addendum
	Exhibit G

	 	Form of Mortgage
	Exhibit H

	 	Form of Perfection Certificate
	Exhibit I

	 	Form of Non-Bank Certificate
	Exhibit J

	 	Form of Note
	 
	 	 
	Schedule 1.01(c)

	 	Existing Commodity Hedging Agreements
	Schedule 1.01(e)

	 	Existing Non-Recourse Indebtedness
	Schedule 3.08

	 	Subsidiaries
	Schedule 3.09

	 	Litigation
	Schedule 3.17

	 	Environmental Matters
	Schedule 3.18

	 	Insurance
	Schedule 3.19(a)

	 	UCC Filing Offices
	Schedule 3.19(c)

	 	Mortgage Filing Offices
	Schedule 3.23(b)

	 	Rate Proceedings
	Schedule 3.23(d)

	 	FERC Matters
	Schedule 3.23(g)

	 	Designated Facilities
	Schedule 5.09(b)

	 	Title Insurance and Survey Requirements
	Schedule 6.01

	 	Existing Indebtedness
	Schedule 6.02

	 	Existing Liens





iv









 






     CREDIT AGREEMENT dated as of June 8, 2007 (as amended, restated, supplemented or
otherwise modified from time to time, this “Agreement”), among NRG HOLDINGS, INC., a
Delaware corporation (the “Borrower”), the LENDERS from time to time party hereto, CREDIT
SUISSE SECURITIES (USA) LLC and CITIGROUP GLOBAL MARKETS INC., as joint book runners and joint lead
arrangers (in such capacities, collectively, the “Arrangers”), CREDIT SUISSE, as
administrative agent (in such capacity and together with its successors, the “Administrative
Agent”) and as collateral agent (in such capacity and together with its successors, the
“Collateral Agent”), and CITIGROUP GLOBAL MARKETS INC., as syndication agent (in such
capacity, the “Syndication Agent”).



     The parties hereto agree as follows:



ARTICLE I.




Definitions




     SECTION
1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings
specified below:



     “ABR”, when used in reference to any Term Loan or Borrowing, refers to whether such
Term Loan, or the Term Loans comprising such Borrowing, are bearing interest at a rate determined
by reference to the Alternate Base Rate.



     “Acceptable Financial Counterparty” shall mean any Person who, at the time the
applicable Eligible Commodity Hedging Agreement is entered into, (a) in the ordinary course enters
into financial derivative (including commodity hedge, swap, future or option) or commodity
transactions (including power purchase/tolling agreements) and (b) (i) has a corporate rating of A-
or higher by S&P and a corporate family rating of A3 or higher by Moody’s (or an equivalent rating
by another nationally recognized statistical rating organization of similar standing if either of
such rating agencies is not then in the business of providing such ratings), or (ii) whose
obligations are supported by collateral, guarantees or letters of credit in a manner consistent
with the then prevailing industry practice for similarly situated Persons from Persons that have
the ratings described in clause (i) above.



     “Acceptable Power Counterparty” shall mean (a) Reliant Energy Inc., TXU Corp. and each
of their respective Affiliates and (b) any Person who, at the time the applicable Eligible
Commodity Hedging Agreement is entered into, (i) in the ordinary course purchases or sells power
and (ii) (A) has a corporate rating of BBB- or higher by S&P and a corporate family rating of Baa3
or higher by Moody’s (or an equivalent rating by another nationally recognized statistical rating
organization of similar standing if either of such ratings agencies is not then in the business of
providing such ratings), or (B) whose obligations are supported by collateral, guarantees or
letters of credit in a manner consistent with the then prevailing industry practice for similarly
situated Persons from Persons that have the ratings described in clause (A) above.



     “Account” shall have the meaning assigned to such term in the UCC.



     “Additional Non-Recourse Indebtedness” shall mean secured or unsecured Indebtedness
for borrowed money of a subsidiary of the Company that is not an Opco Loan Party; provided
that




     (a) except as provided below, such Indebtedness is without recourse to the Borrower,
the Company or any other Restricted Subsidiary or to any property or assets of the Borrower,
the Company or any other Restricted Subsidiary (other than, in each such case, another
Restricted
Subsidiary (other than the Company) (x) which is the direct parent or a direct or
indirect



 









 






subsidiary of the subsidiary that directly incurred or issued such Indebtedness
(the “Issuing Subsidiary”) (except if the Issuing Subsidiary has incurred or issued
such Indebtedness in the form of a Guarantee) or (y) that is a Restricted Subsidiary that
itself has Non-Recourse Indebtedness (except if such Restricted Subsidiary has incurred or
issued such Indebtedness in the form of a Guarantee) or is the direct parent or a direct or
indirect subsidiary of an Issuing Subsidiary that itself has Non-Recourse Indebtedness
(except if such Non-Recourse Indebtedness of such Issuing Subsidiary is in the form of a
Guarantee)); provided, that a Restricted Subsidiary that is the parent of an
Excluded Project Subsidiary and owns no assets other than the Equity Interests in such
Excluded Project Subsidiary, Equity Interests in other Excluded Subsidiaries and any de
minimis assets may incur Additional Non-Recourse Indebtedness that is guaranteed by such
Excluded Project Subsidiaries and such Excluded Project Subsidiaries may incur Additional
Non-Recourse Indebtedness in the form of a Guarantee of such Restricted Subsidiary’s
Additional Non-Recourse Indebtedness,




     (b) neither the Borrower, the Company nor any other Restricted Subsidiary (other than
another Restricted Subsidiary (other than the Company) (x) which is the direct parent or a
direct or indirect subsidiary of the Issuing Subsidiary (except if the Issuing Subsidiary
has incurred or issued such Indebtedness in the form of a Guarantee) or (y) that is a
Restricted Subsidiary that itself has Non-Recourse Indebtedness (except if such Restricted
Subsidiary incurred or issued such Indebtedness in the form of a Guarantee) or is the direct
parent or a direct or indirect subsidiary of an Issuing Subsidiary that itself has
Non-Recourse Indebtedness (except if such Non-Recourse Indebtedness of such Issuing
Subsidiary is in the form of a Guarantee)) provides credit support of any kind (including
any undertaking, agreement or instrument that would constitute Indebtedness) or is directly
or indirectly liable as a guarantor or otherwise in respect of such Indebtedness or in
respect of the business or operations of the applicable subsidiary that is the obligor on
such Indebtedness or any of its subsidiaries (other than (i) any such credit support or
liability consisting of reimbursement obligations in respect of letters of credit issued
under, and subject to the terms of, Section 2.23 of the Opco Credit Agreement to support
obligations of such applicable subsidiary, (ii) any Investments in such applicable
subsidiary made in accordance with Section 6.05 and (iii) any of those items expressly
provided for in subclauses (u) through (z) of clause (e) below; provided, that a
Restricted Subsidiary that is the parent of an Excluded Project Subsidiary and owns no
assets other than the Equity Interests in such Excluded Project Subsidiary, Equity Interests
in other Excluded Subsidiaries and any de minimis assets may incur Additional Non-Recourse
Indebtedness that is guaranteed by such Excluded Project Subsidiaries and such Excluded
Project Subsidiaries may incur Additional Non-Recourse Indebtedness in the form of a
Guarantee of such Restricted Subsidiary’s Additional Non-Recourse Indebtedness,




     (c) no default with respect to such Indebtedness (including any rights that the holders
of such Indebtedness may have to take enforcement action against a subsidiary of the Company
that is not an Opco Loan Party) would permit upon notice, lapse of time or both any holder
of any other Indebtedness of the Borrower, the Company or any other Opco Loan Party (other
than Indebtedness incurred pursuant to Section 6.01(a), (b) or (c) and any Permitted
Refinancing Indebtedness incurred to refund, refinance, replace, defease or discharge any
Indebtedness incurred pursuant to Section 6.01(b) or (c) or with respect to obligations
under any Opco Specified Hedging Agreement) to declare a default on such other Indebtedness
or cause the payment of the Indebtedness to be accelerated or payable prior to its stated
maturity,




     (d) the Liens securing such Indebtedness shall exist only on (i) the property and
assets of any subsidiary of the Company that is not an Opco Loan Party (it being understood
and agreed that a Lien granted by such subsidiary on an undivided interest owned by such
subsidiary shall
not be considered a Lien on assets of any other Person for the purposes of this
definition), and (ii)



2









 






the Equity Interests in any subsidiary of the Company that is not an
Opco Loan Party (and shall not apply to any other property or assets of the Borrower, the
Company or any other subsidiary of the Company that is an Opco Loan Party), and




     (e) the lenders of such Indebtedness have been notified or have otherwise agreed in
writing that they will not have any recourse to the stock or assets of the Borrower, the
Company or any other Opco Loan Party,




     except, in the case of each of clauses (a), (b) and (d) for the following (each of
which is deemed to be non-recourse for purposes of this definition): (u) pledges by the
Company or any subsidiary of the Company of the Equity Interests of any Excluded Subsidiary
that are directly owned by the Company or any subsidiary of the Company in favor of the
agent or lenders in respect of such Excluded Subsidiary’s Additional Non-Recourse
Indebtedness, (v) obligations to pay or guarantees by the Borrower, the Company or any other
subsidiary of the Company in respect of a development fee, management fee, success fee,
royalty or other similar obligation owed to a seller or developer (or any affiliate thereof)
of a Facility in connection with the contribution or acquisition of such Facility (or of a
subsidiary of the Company holding such Facility or development rights to such Facility) or
development rights to such Facility to the extent such obligations or guarantees are treated
as an Investment under (and are permitted by) Section 6.05(l); (w) Guarantees by the
Borrower, the Company or any other subsidiary of the Company of such Indebtedness that are
incurred pursuant to Section 6.01(p), (x) agreements of the Borrower, the Company or any
other subsidiary of the Company to provide, or guarantees or other credit support (including
letters of credit) by the Borrower, the Company or any subsidiary of the Company of any
agreement of another subsidiary of the Company to provide, corporate, management,
administrative, technical, energy management or marketing, engineering, procurement,
construction, operation and/or maintenance services to such subsidiary, including in respect
of the sale or acquisition of power, emissions credits, fuel, oil, gas or other supply of
energy, (y) Guarantees of the Borrower, the Company or any other subsidiary of the Company
with respect to debt service reserves established with respect to such subsidiary to the
extent that such Guarantee shall result in the immediate payment of funds, pursuant to
dividends or otherwise, in the amount of such Guarantee to the Borrower, the Company or any
such other subsidiary and (z) contingent obligations of the Borrower, the Company or any
other subsidiary of the Company to make capital contributions to such subsidiary, in the
case of each of clauses (u) through (z), which are otherwise permitted hereunder.



     “Adjusted LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any
Interest Period, an interest rate per annum equal to the product of (a) the LIBO Rate in effect for
such Interest Period and (b) Statutory Reserves.



     “Administrative Agent” shall have the meaning assigned to such term in the preamble.



     “Administrative Agent Fees” shall have the meaning assigned to such term in Section
2.05(b).



     “Administrative Questionnaire” shall mean an Administrative Questionnaire
substantially in the form of Exhibit A, or such other similar form as may be supplied from time to
time by the Administrative Agent.



     “Affiliate” of any specified Person shall mean any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with such specified Person.
For purposes of this definition, “control,” as used with respect to any Person, means the
possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of such Person,
whether



3









 








through the ownership of voting securities, by agreement or otherwise; provided
that beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be
control. For purposes of this definition, the terms “controlling,” “controlled by” and “under
common control with” have correlative meanings.



     “Affiliate Subordination Agreement” shall mean an Affiliate Subordination Agreement in
the form of Exhibit B pursuant to which intercompany obligations and advances owed by the Borrower
to any Subsidiary are required to be subordinated to the obligations hereunder (and under the other
Loan Documents) pursuant to Section 6.01(f).



     “Affiliate Transaction” shall have the meaning assigned to such term in Section 6.08.



     “Agents” shall have the meaning assigned to such term in Article VIII.



     “Agreement” shall have the meaning assigned to such term in the preamble.



     “Alternate Base Rate” shall mean, for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on such
day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any
change in the Alternate Base Rate due to a change in the Prime Rate or the Federal Funds Effective
Rate shall be effective as of the opening of business on the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.



     “Applicable Laws” shall mean, as to any Person, any law, rule, regulation, ordinance
or treaty, or any determination, ruling or other directive by or from a court, arbitrator or other
Governmental Authority, including ERCOT, in each case applicable to or binding on such Person or
any of its property or assets or to which such Person or any of its property or assets is subject.



     “Applicable Margin” shall mean, for any day, for each Type of Term Loan, the rate per
annum set forth under the relevant column heading below based upon the Consolidated Senior Leverage
Ratio of the Borrower as of the relevant date of determination:



	 	 	 	 	 	 	 	 	 
	Consolidated Senior	 	 	 	 
	Leverage Ratio	 	Eurodollar Term Loans	 	ABR Term Loans
	Category 1
	 	 	 	 	 	 	 	 
	Greater than 3.50 to 1.00
	 	 	2.50	%	 	 	1.50	%
	 
	 	 	 	 	 	 	 	 
	Category 2
	 	 	 	 	 	 	 	 
	Less than or equal to 3.50
to 1.00
	 	 	2.25	%	 	 	1.25	%






     Each change in the Applicable Margin resulting from a change in the Consolidated Senior
Leverage Ratio of the Borrower shall be effective with respect to all Term Loans outstanding on or
after the date of delivery to the Administrative Agent of the financial statements and certificates
required by Section 5.04(a) or (b) and Section 5.04(c), respectively, indicating such change until
the date immediately preceding the next date of delivery of such financial statements and
certificates indicating another such
change. In addition, at any time during which the Borrower has failed to deliver the
financial statements



4









 







and certificates required by Section 5.04(a) or (b) and Section 5.04(c),
respectively, the Consolidated Senior Leverage Ratio of the Borrower shall be deemed to be in
Category 1 for purposes of determining the Applicable Margin. Notwithstanding any of the
foregoing, the Applicable Margin that is applicable for each Type of Term Loan at any time shall be
increased by an additional 0.25% per annum for any period on or after the Funding Date during which
the Company’s corporate family rating from Moody’s shall not be at least Ba3 or the Company’s
corporate rating from S&P shall not be at least B+ (a “Downgrade Event”); provided
that such additional 0.25% per annum increase to the Applicable Margin shall cease to apply for any
period during which a Downgrade Event shall cease to exist.



     “Arrangers” shall have the meaning assigned to such term in the preamble.



     “Asset Sale” shall mean the direct or indirect (a) sale, lease (other than an
operating lease), sale and leaseback, lease and leaseback, assignment (other than a collateral
assignment), conveyance, transfer or other disposition (by way of merger, consolidation, casualty,
condemnation, operation of law or otherwise (other than pursuant to an event that may result in a
Recovery Event)) by the Borrower or any Restricted Subsidiary to any Person other than, in the case
of assets not constituting Core Collateral, the Borrower, the Company or any other Opco Loan Party
of (1) any Equity Interests of any of the subsidiaries of the Company (other than directors’
qualifying shares or investments by foreign nationals required by Applicable Laws) or (2) any other
assets of the Borrower or any Restricted Subsidiary, including Equity Interests of any Person that
is not the Borrower or a Subsidiary of the Borrower or the Company or (b) issuance of Equity
Interests in any of the Restricted Subsidiaries to any Person other than the Borrower, the Company
or any other Opco Loan Party; provided that (i) any asset sale or series of related asset
sales described in clause (a) or (b) above of assets not constituting Core Collateral and having a
value not in excess of $60,000,000 shall be deemed not to be an “Asset Sale” for purposes of this
Agreement; and (ii) each of the following transactions shall be deemed not to be an “Asset Sale”
for purposes of this Agreement: (A) the sale, transfer, contribution or other disposition by the
Borrower or any Restricted Subsidiary of (x) damaged, worn-out, obsolete assets and scrap and (y)
cash or Cash Equivalents, (B) the sale by the Borrower or any Restricted Subsidiary of power,
capacity, energy, ancillary services, and other products or services, or the sale of any other
inventory or contracts related to any of the foregoing, (C) the sale, lease, conveyance or other
disposition for value by the Borrower or any Restricted Subsidiary of fuel or emission credits in
the ordinary course of business, (D) the sale, transfer or other disposition of any assets (other
than any such assets which are Collateral or Opco Collateral) in connection with a foreclosure,
transfer or deed in lieu of foreclosure or other remedial action, (E) the sale, transfer,
contribution or other disposition by any Restricted Subsidiary that is not an Opco Loan Party of
any of its assets (other than any such assets constituting Opco Collateral) or the issuance of
Equity Interests by any Subsidiary (that is not an Opco Loan Party) of such Restricted Subsidiary,
in each case to any other Subsidiary of the Borrower or the Company that is not an Opco Loan Party,
(F) the licensing of intellectual property, (G) the sale or discount, in each case without
recourse, of accounts receivable arising in the ordinary course of business, but only in connection
with the compromise or collection thereof, (H) the sale, transfer or other disposition of spare
parts and spare parts inventory to any other Restricted Subsidiary in the ordinary course of
business so long as such spare parts and spare parts inventory are required in the ordinary course
operation of the transferee’s business or operations at the time of such disposition, (I) the sale,
transfer, contribution, assignment, conveyance or other disposition of any assets by the Borrower
or any Restricted Subsidiary to an Excluded Subsidiary or Minority Investment to the extent such
sale, transfer or other disposition also constitutes an Investment in such Excluded Subsidiary that
is permitted by (and made in accordance with) clause (h) or (l) of Section 6.05, and (J) any
transaction described in Section 9.22 of the Opco Credit Agreement (as it exists on the date
hereof).



5









 





     “Assignment and Acceptance” shall mean an assignment and acceptance entered into by a
Lender and an assignee (with the consent of any Person whose consent is required by Section 9.04),
substantially in the form of Exhibit C or such other similar form as shall be approved by the
Administrative Agent.



     “Attributable Debt” in respect of a sale and leaseback transaction shall mean, at the
time of determination, the present value of the obligation of the lessee for net rental payments
during the remaining term of the lease included in such sale and leaseback transaction, including
any period for which such lease has been extended or may, at the option of the lessor, be extended.
Such present value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP; provided,
however, that if such sale and leaseback transaction results in a Capital Lease Obligation,
the amount of Indebtedness represented thereby will be determined in accordance with the definition
of “Capital Lease Obligation”, and shall not be deemed to be Attributable Debt.



     “Available Amount” shall mean, on any date (the “Reference Date”), an amount
equal at such time to (a) the sum of, without duplication:




     (i) $500,000,000 in the aggregate;




     (ii) the sum of (A) on and after the date on which the Company shall have provided its
calculation of the Excess Cash Flow for the fiscal year ending December 31, 2006 pursuant to
the Opco Credit Agreement, an amount equal to such Excess Cash Flow for such fiscal year
multiplied by 25% and (B) for each ECF Period for which the Company shall have
provided its calculation of Excess Cash Flow pursuant to the Opco Credit Agreement ending
after fiscal year 2006 and prior to the Reference Date, an amount equal to the sum of the
amounts calculated for each such ECF Period which is equal to (A) the Excess Cash Flow for
such ECF Period minus (B) an amount equal to the Required Prepayment Percentage for
such ECF Period multiplied by such Excess Cash Flow for such ECF Period;




     (iii) the amount of any capital contributions received in cash or the net cash proceeds
of other equity issuances made by the Company or, following the Holdings Reorganization and
the Holdings Contribution, the Borrower (other than the Holdings Contribution, any Cure
Amount (as defined in the Opco Credit Agreement on the date hereof) or any amount used to
make Dividends pursuant to Section 6.06(a)) during the period from and including the
Business Day immediately following the Opco Credit Agreement Date through and including the
Reference Date;




     (iv) the aggregate amount of all cash dividends and other cash distributions received
by the Borrower, the Company or any other Opco Loan Party from any Minority Investment or
Unrestricted Subsidiary after the Opco Credit Agreement Date and on or prior to the
Reference Date (other than the portion of any such dividends and other distributions that is
used by the Borrower, the Company or any other Opco Loan Party to pay taxes);




     (v) the aggregate amount of all cash repayments of principal and interest received by
the Borrower, the Company or any other Opco Loan Party from any Minority Investment or
Unrestricted Subsidiary after the Opco Credit Agreement Date and on or prior to the
Reference Date in respect of loans made by the Company or any other Opco Loan Party to such
Minority Investment or Unrestricted Subsidiary; and




     (vi) the aggregate amount of all Net Asset Sale Proceeds received by the Borrower, the
Company or any other Opco Loan Party in connection with the sale, transfer or other



6









 






disposition of its ownership interest in any Minority Investment or Unrestricted
Subsidiary after the Opco Credit Agreement Date and on or prior to the Reference Date,




minus (b) the sum of:




     (i) the aggregate amount of any Investments made by the Borrower or any Restricted
Subsidiary pursuant to Section 6.05(l)(ii)(A)(y) after the Closing Date and on or prior to
the Reference Date;




     (ii) the aggregate amount of any Dividends made by the Borrower pursuant to Section
6.06(c) after the Closing Date and on or prior to the Reference Date;




     (iii) the aggregate amount of prepayments, repurchases and redemptions made by the
Borrower or any Restricted Subsidiary pursuant to Section 6.07(a)(v) after the Closing Date
and on or prior to the Reference Date; and




     (iv) the aggregate amount of Capital Expenditures made by the Company or any other
Restricted Subsidiary (other than any Excluded Subsidiaries) pursuant to clause (a) of the
proviso in Section 6.12 of the Opco Credit Agreement (as such covenant shall exist as of the
date hereof) after the Closing Date and on or prior to the Reference Date.



     “Bankruptcy Code” shall mean Title 11 of United States Code, 11 U.S.C. §§ 101,
et seq., as amended from time to time.



     “Bankruptcy Law” shall mean the Bankruptcy Code or any similar federal or state or
other law for the relief of debtors.



     “Basket Assets” shall have the meaning assigned to such term in Section 6.01(p).



     “Beneficial Owner” shall have the meaning assigned to such term in Rule 13d-3 and Rule
13d-5 under the Exchange Act. The terms “Beneficially Owns” and “Beneficially Owned” have a
corresponding meaning.



     “Benefit Plan” shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Tax Code
or Section 302 of ERISA, and which is maintained, sponsored or contributed to by the Borrower or
any ERISA Affiliate or with respect to which the Borrower otherwise has any liability.



     “Board” shall mean the Board of Governors of the Federal Reserve System of the United
States of America.



     “Board of Directors” shall mean (a) with respect to a corporation, the board of
directors of the corporation or any committee thereof duly authorized to act on behalf of such
board; (b) with respect to a partnership, the Board of Directors of the general partner of the
partnership; (c) with respect to a limited liability company, the managing member or members or any
controlling committee of managing members thereof; and (d) with respect to any other Person, the
board or committee of such Person serving a similar function.



     “Borrower” shall have the meaning assigned to such term in the preamble.



7









 





     “Borrowing” shall mean Term Loans of the same Type made, converted or continued on the
same date and, in the case of Eurodollar Term Loans, as to which a single Interest Period is in
effect.



     “Borrowing Request” shall mean a request by the Borrower in accordance with the terms
of Section 2.03 and substantially in the form of Exhibit D.



     “Breakage Event” shall have the meaning assigned to such term in Section 2.16.



     “Business Day” shall mean any day other than a Saturday, Sunday or day on which
commercial banks in New York City are authorized or required by law to close; provided,
however, that when used in connection with a Eurodollar Term Loan (including with respect
to all notices and determinations in connection therewith and any payments of principal, interest
or other amounts thereon), the term “Business Day” shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank market.



     “Capital Allocation Committee” shall have the meaning assigned to such term in Section
3.02(a).



     “Capital Expenditures” shall mean, for any period, with respect to any Person, (a) the
additions to property, plant and equipment and other capital expenditures of such Person and its
consolidated subsidiaries that are (or should be) set forth in a consolidated statement of cash
flows of such Person for such period prepared in accordance with GAAP and (b) Capital Lease
Obligations incurred by such Person and its consolidated subsidiaries during such period to the
extent paid in cash; provided, however, that Capital Expenditures shall not include
(i) Environmental Capital Expenditures, (ii) Necessary Capital Expenditures, (iii) expenditures
made to restore, rebuild or replace property following any damage, loss, destruction or
condemnation of such property, to the extent such expenditure is made or financed with proceeds
received or to be received from a Recovery Event, (iv) expenditures constituting reinvestment
proceeds from the sale or other disposition of assets (including Asset Sales) otherwise permitted
herein, (v) expenditures made to acquire an Investment permitted under Section 6.05, including
pursuant to a Permitted Acquisition (it being understood and agreed, however, that an acquisition
of assets (other than an acquisition of assets comprising a division or a line of business or an
acquisition of an Excluded Subsidiary or all or substantially all of the assets of a Person by an
Excluded Subsidiary) that would otherwise constitute Capital Expenditures pursuant to the
definition hereof shall not be excluded by this clause (v)), (vi) expenditures made to the extent
reimbursed by a Person other than the Borrower and the Opco Loan Parties and their Subsidiaries or
(vii) expenditures constituting capitalized interest.



     “Capital Lease Obligation” shall mean, at the time any determination is to be made,
the amount of the liability in respect of a capital lease that would at that time be required to be
capitalized on a balance sheet in accordance with GAAP, and the Stated Maturity thereof shall be
the date of the last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be prepaid by the lessee without payment of a penalty.



     “Capital Stock” shall mean (a) in the case of a corporation, corporate stock; (b) in
the case of an association or business entity, any and all shares, interests, participations,
rights or other equivalents (however designated) of corporate stock; (c) in the case of a
partnership or limited liability company, partnership interests (whether general or limited) or
membership interests; and (d) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of assets of, the issuing
Person, but excluding from all of the foregoing any debt securities convertible into Capital Stock,
whether or not such debt securities include any right of participation with Capital Stock.



     “Cash Equivalents” shall mean



8









 





     (a) United States dollars, Euros, Australian dollars, Swiss Francs or, in the case of any
Foreign Subsidiary, any local currencies (including Australian dollars and Brazilian Reais) held by
it from time to time;



     (b) securities issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality of the United States government (provided that
the full faith and credit of the United States is pledged in support of those securities) having in
each case maturities of not more than 12 months from the date of acquisition;



     (c) certificates of deposit and eurodollar time deposits with maturities of six months or less
from the date of acquisition, bankers’ acceptances with maturities not exceeding 12 months and
overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus
in excess of $500,000,000 and a Thomson Bank Watch Rating of “B” or better or, if Thomson Bank
Watch Rating does not rate the relevant bank, an equivalent rating issued by an equivalent non-U.S.
rating agency, if any;



     (d) repurchase obligations with a term of not more than thirty days for underlying securities
of the types described in clauses (b) and (c) above entered into with any financial institution
meeting the qualifications specified in clause (c) above;



     (e) commercial paper having one of the two highest ratings obtainable from Moody’s or S&P and
in each case maturing within 12 months after the date of acquisition;



     (f) readily marketable direct obligations issued or guaranteed by any state of the United
States or any political subdivision thereof (including municipalities), in either case having one
of the two highest rating categories obtainable from any of Moody’s, S&P or Fitch;



     (g) auction rate securities having one of the two highest ratings obtainable from any of
Moody’s, S&P or Fitch and in each case maturing within 12 months after the date of acquisition;



     (h) money market funds that invest primarily in securities described in clauses (a) through
(g) of this definition; and



     (i) other short-term investments utilized by Foreign Subsidiaries of the Company in accordance
with normal investment practices for cash management in investments of a type analogous to the
foregoing.



     “Change of Control” shall mean the occurrence of any of the following, other than, in
each case, as a result of any transactions described in Section 9.22 of the Opco Credit Agreement
(as it exists on the date hereof): (a) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of the Borrower and its
Subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d) of the
Exchange Act, but excluding any employee benefit plan of the Borrower or any of its Restricted
Subsidiaries, and any Person or entity acting in its capacity as trustee, agent or other fiduciary
or administrator of such plan); (b) the adoption of a plan relating to the liquidation or
dissolution of the Borrower; (c) the consummation of any transaction (including any merger or
consolidation) the result of which is that any “person” (as defined above) becomes the Beneficial
Owner, directly or indirectly, of more than 40% of the Voting Stock of the Borrower, measured by
voting power rather than number of shares; (d) the Borrower consolidates with, or merges with or
into, any Person, or any Person consolidates with, or merges with or into, the Borrower, in any
such event pursuant to a transaction in which any of the outstanding Voting Stock of the Borrower
or such other Person is converted into or



9









 







exchanged for cash, securities or other property, other than any such transaction where the
Voting Stock of the Borrower outstanding immediately prior to such transaction is converted into or
exchanged for Voting Stock (other than Disqualified Stock) of the surviving or transferee Person
constituting a majority of the outstanding shares of such Voting Stock of such surviving or
transferee Person (immediately after giving effect to such issuance); (e) the first day on which a
majority of the members of the Board of Directors of the Borrower are not Continuing Directors; or
(f) any change of control (or similar event, however denominated) shall occur under and as defined
in the Opco Credit Agreement or the Senior Note Documents.



     “Change in Law” shall mean (a) the adoption of any law, rule or regulation after the
Closing Date, (b) any change in any law, rule or regulation or in the interpretation or application
thereof by any Governmental Authority after the Closing Date or (c) compliance by any Lender (or,
for purposes of Section 2.14, by any lending office of such Lender or by such Lender’s holding
company, if any) with any request, guideline or directive (whether or not having the force of law)
of any Governmental Authority made or issued after the Closing Date.



     “Charges” shall have the meaning assigned to such term in Section 9.09.



     “Closing Date” shall mean the date on which the conditions specified in Section 4.01
are satisfied (or waived in accordance with Section 9.08).



     “Collateral” shall mean all property and assets of the Borrower, now owned or
hereafter acquired other than the Holdings Excluded Assets (as defined in the Collateral
Agreement). “Collateral” shall include all Equity Interests of the Company and all proceeds
thereof. For the avoidance of doubt, “Collateral” shall not include any property or assets of the
Company and/or any of its subsidiaries.



     “Collateral Agent” shall have the meaning assigned to such term in the preamble.



     “Collateral Agreement” shall mean the Collateral Agreement, dated as of the Closing
Date, in substantially the form of Exhibit E, executed and delivered by the Borrower, as the same
may be amended, restated, supplemented or otherwise modified from time to time in accordance with
the terms thereof.



     “Collateral Trust Agreement” shall mean each of the NRG Collateral Trust Agreement
and/or the Texas Genco Collateral Trust Agreement, as applicable.



     “Collateral Trustee” shall mean each of the NRG Collateral Trustee and/or the Texas
Genco Collateral Trustee, as applicable.



     “Commitment Fee” shall have the meaning assigned to such term in Section 2.05(a).



     “Commitment Fee Period” shall mean the period beginning on the Closing Date and ending
on the date the Term Loan Commitments are terminated (or expire) in their entirety hereunder in
accordance with this Agreement.



     “Commitment Fee Rate” shall mean a rate per annum equal to (a) during the period from
the Closing Date to and including the 180th day following the Closing Date, 0.50% and (b)
thereafter, 0.75%.



     “Commitment Letter” shall mean that certain commitment letter, dated as of May 2,
2007, among the Company, the Administrative Agent and each of the Arrangers, as the same may be
amended, restated, supplemented or otherwise modified from time to time in accordance with the
terms thereof.



10









 





     “Commodity Contract” shall have the meaning assigned to such term in the UCC.



     “Commodity Hedging Agreements” shall mean the Existing Commodity Hedging Agreements
and any other agreement (including each confirmation entered into pursuant to any master agreement)
providing for swaps, caps, collars, puts, calls, floors, futures, options, spots, forwards, power
purchase or sale agreements, fuel purchase or sale agreements, emissions credit purchase or sales
agreements, power transmission agreements, fuel transportation agreements, fuel storage agreements,
netting agreements, commercial or trading agreements, each with respect to, or involving the
purchase, transmission, distribution, sale, lease or hedge of, any energy, generation capacity or
fuel, or any other energy related commodity or service, price or price indices for any such
commodities or services or any other similar derivative agreements, and any other similar
agreements, entered into by the Company or any Restricted Subsidiary, in each case under this
definition, in the ordinary course of business in order to manage fluctuations in the price or
availability to the Company or any Restricted Subsidiary of any commodity.



     “Commodity Hedging Obligations” shall mean, with respect to any specified Person, the
obligations of such Person under a Commodity Hedging Agreement.



     “Company” shall mean NRG Energy, Inc., a Delaware corporation that (a) prior to the
Holdings Reorganization is the parent of the Borrower and (b) from and after the Holdings
Reorganization is a direct wholly-owned subsidiary of the Borrower.



     “Concurrent Cash Distributions” has the meaning set forth in the definition of
Investments.



     “Confidential Information Memorandum” shall mean the Confidential Information
Memorandum of the Borrower dated May 2007.



     “Consolidated EBITDA” shall mean, with respect to any specified Person for any period,
the Consolidated Net Income of such Person for such period plus, without duplication




     (a) an amount equal to any extraordinary loss (including any loss on the extinguishment
or conversion of Indebtedness) plus any net loss realized by such Person or any of
its Restricted Subsidiaries in connection with an Asset Sale (without giving effect of the
threshold provided in the definition thereof), to the extent such losses were deducted in
computing such Consolidated Net Income; plus




     (b) provision for taxes based on income or profits of such Person and its Restricted
Subsidiaries for such period, to the extent that such provision for taxes was deducted in
computing such Consolidated Net Income; plus




     (c) to the extent deducted in computing such Consolidated Net Income, (i) the
consolidated interest expense of such Person and its Restricted Subsidiaries for such
period, whether paid or accrued, including, without limitation, amortization of debt
issuance costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, imputed interest with respect to Attributable
Debt, and net of the effect of all payments made or received pursuant to Hedging Obligations
in respect of interest rates; plus (ii) the consolidated interest of such Person and
its Restricted Subsidiaries that was capitalized during such period; plus (iii) any
interest accruing on Indebtedness of another Person that is Guaranteed by such Person or one
of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its
Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon; plus
(iv) the product of (A) all dividends, whether paid or accrued and whether or not in



11









 






cash, on any series of preferred stock of such Person or any of its Restricted
Subsidiaries, other than dividends on Equity Interests payable in Equity Interests of the
Borrower (other than Disqualified Stock) or to the Borrower or a Restricted Subsidiary of
the Borrower, times (B) a fraction, the numerator of which is one and the
denominator of which is one minus the then current combined federal, state and local
statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated
basis and in accordance with GAAP; minus (v) interest income for such period;
plus




     (d) any expenses or charges related to any equity offering, Investment, acquisition,
disposition, recapitalization or Indebtedness permitted to be incurred under this Agreement
including a refinancing thereof (whether or not successful), including such fees, expenses
or charges related to the Acquisition Transactions (as defined in the Opco Credit Agreement
on the date hereof), the offering of the Senior Notes, the transactions described in Section
9.22 of the Opco Credit Agreement (as it exists on the date hereof), the Opco Credit
Agreement and this Agreement, and, in each case, deducted in computing such Consolidated Net
Income; plus




     (e) any professional and underwriting fees related to any equity offering, Investment,
acquisition, recapitalization or Indebtedness permitted to be incurred under this Agreement
(including the transactions described in Section 9.22 of the Opco Credit Agreement (as it
exists on the date hereof)) and, in each case, deducted in such period in computing
Consolidated Net Income; plus




     (f) the amount of any minority interest expense deducted in calculating Consolidated
Net Income (less the amount of any cash dividends paid to the holders of such minority
interests); plus




     (g) any non cash gain or loss attributable to Mark-to-Market Adjustments in connection
with Hedging Obligations; plus




     (h) without duplication, any writeoffs, writedowns or other non-cash charges reducing
Consolidated Net Income for such period, excluding any such charge that represents an
accrual or reserve for a cash expenditure for a future period; plus




     (i) all items classified as extraordinary, unusual or nonrecurring non-cash losses or
charges (including severance, relocation and other restructuring costs), and related tax
effects according to GAAP to the extent such non-cash charges or losses were deducted in
computing such Consolidated Net Income; plus




     (j) depreciation, depletion, amortization (including amortization of intangibles but
excluding amortization of prepaid cash expenses that were paid in a prior period) and other
non-cash charges and expenses (excluding any such non-cash expense to the extent that it
represents an accrual of or reserve for cash expenses in any future period or amortization
of a prepaid cash expense that was paid in a prior period) of such Person and its Restricted
Subsidiaries for such period to the extent that such depreciation, depletion, amortization
and other non-cash expenses were deducted in computing such Consolidated Net Income;
minus




     (k) non-cash items increasing such Consolidated Net Income for such period, other than
the accrual of revenue in the ordinary course of business; in each case, on a consolidated
basis and determined in accordance with GAAP (including any increase in amortization or
depreciation or other non-cash charges resulting from the application of purchase accounting
in relation to the



12









 






Acquisition Transactions (as defined in the Opco Credit Agreement on the date hereof)
or any acquisition that is consummated after the Closing Date);



     provided, however, that Consolidated EBITDA of the Borrower or the Company
will exclude the Consolidated EBITDA attributable to Excluded Subsidiaries unless (and solely to
the extent) actually distributed in cash to the Borrower or any Opco Loan Party.



     “Consolidated Interest Coverage Ratio” shall mean, with respect to any specified
Person on any date, the ratio of (a) Consolidated EBITDA of such Person for the period of four
consecutive fiscal quarters most recently ended on or prior to such date to (b) Consolidated
Interest Expense of such Person for the period of four consecutive fiscal quarters most recently
ended on or prior to such date.



     “Consolidated Interest Expense” shall mean, with respect to any specified Person for
any period, (a) the cash interest expense (including imputed cash interest expense in respect of
Capital Lease Obligations and Synthetic Lease Obligations) of such Person and its Restricted
Subsidiaries for such period (including all commissions, discounts and other fees and charges owed
by such Person and its Restricted Subsidiaries with respect to letters of credit and bankers’
acceptance financing), net of interest income, in each case determined on a consolidated basis in
accordance with GAAP, minus (b) to the extent included in such consolidated cash interest
expense for such period, amounts attributable to the amortization of financing costs and non-cash
amounts attributable to the amortization of debt discounts and other debt issuance costs, fees and
expenses; provided, however, that Consolidated Interest Expense of the Borrower or
the Company will exclude cash interest expense attributable to Non-Recourse Indebtedness and all
other cash interest expense of Excluded Subsidiaries. For purposes of the foregoing, interest
expense shall be determined after giving effect to any net payments made or received by such Person
or any of its Restricted Subsidiary with respect to Interest Rate/Currency Hedging Agreements
relating to interest rate hedging activities (other than any such Interest Rate/Currency Hedging
Agreements in respect of Non-Recourse Indebtedness of Excluded Subsidiaries).



     “Consolidated Leverage Ratio” shall mean, with respect to any specified Person on any
date, the ratio of (a) Total Debt of such Person on such date to (b) Consolidated EBITDA of such
Person for the period of four consecutive fiscal quarters most recently ended on or prior to such
date.



     “Consolidated Net Income” shall mean, with respect to any specified Person for any
period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such
period, on a consolidated basis, determined in accordance with GAAP; provided that




     (a) the Net Income of any Person that is not a Restricted Subsidiary or that is
accounted for by the equity method of accounting will be included only to the extent of the
amount of dividends or similar distributions (including pursuant to other intercompany
payments but excluding Concurrent Cash Distributions) paid in cash to the specified Person
or a Restricted Subsidiary of the specified Person;




     (b) the Net Income of any Restricted Subsidiary will be excluded to the extent that the
declaration or payment of dividends or similar distributions by that Restricted Subsidiary
of that Net Income is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or indirectly, by operation
of the terms of its charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to that Restricted Subsidiary or its
stockholders;




     (c) the cumulative effect of a change in accounting principles will be excluded;



13









 






     (d) any net after-tax non-recurring or unusual gains, losses (less all fees and
expenses relating thereto) or other charges or revenue or expenses (including relating to
severance, relocation, one-time compensation charges and the Acquisition Transactions (as
defined in the Opco Credit Agreement on the date hereof)) shall be excluded;




     (e) any non-cash compensation expense recorded from grants of stock appreciation or
similar rights, stock options, restricted stock or other rights to officers, directors or
employees shall be excluded, whether under Financial Accounting Standards Board Statement
No. 123R, “Accounting for Stock-Based Compensation” or otherwise;




     (f) any net after-tax income (loss) from disposed or discontinued operations and any
net after-tax gains or losses on disposal of disposed or discontinued operations shall be
excluded;




     (g) any gains or losses (less all fees and expenses relating thereto) attributable to
asset dispositions shall be excluded;




     (h) any impairment charge or asset write-off pursuant to Financial Accounting Statement
No. 142 and No. 144 or any successor pronouncement shall be excluded;




     (i) any accruals or reserves or other charges related to the Transactions (as defined
in the Opco Credit Agreement on the date hereof) and incurred on or before January 1, 2007
shall be excluded; and




     (j) notwithstanding clause (a) above, the Net Income of any Unrestricted Subsidiary
will be excluded, whether or not distributed to the specified Person or one of its
Subsidiaries.



     “Consolidated Senior Leverage Ratio” shall mean, with respect to any specified Person
on any date, the ratio of (a) Senior Debt of such Person on such date to (b) Consolidated EBITDA of
such Person for the period of four consecutive fiscal quarters most recently ended on or prior to
such date.



     “Consolidated Working Capital” shall mean, at any date, the excess of (a) the sum of
all amounts (other than cash, cash equivalents and bank overdrafts) that would, in conformity with
GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a
consolidated balance sheet of the Company and its Restricted Subsidiaries at such date over (b) the
sum of all amounts that would, in conformity with GAAP, be set forth opposite the caption “total
current liabilities” (or any like caption) on a consolidated balance sheet of the Company and its
Restricted Subsidiaries on such date, but excluding (i) the current portion of any long-term
Indebtedness, (ii) without duplication of clause (i) above, all Indebtedness consisting of Loans
and L/C Exposure (each as defined in the Opco Credit Agreement on the date hereof) to the extent
otherwise included therein and (iii) the current portion of deferred income taxes.



     “Continuing Directors” shall mean, as of any date of determination, any member of the
Board of Directors of the Borrower who (a) was a member of such Board of Directors on the Closing
Date; or (b) was nominated for election or elected to such Board of Directors with the approval of
a majority of the Continuing Directors who were members of such Board of Directors at the time of
such nomination or election.



     “Control Agreement” shall mean each Control Agreement to be executed and delivered by
the Borrower and the other parties thereto, as required by the applicable Loan Documents as the
same may be amended, restated, supplemented or otherwise modified from time to time in accordance
with the terms hereof and thereof.



14









 





     “Core Collateral” shall mean all Equity Interests in, and property and assets of, any
Core Collateral Subsidiary, in each case whether now owned or hereafter acquired; provided,
however, that in the case of Louisiana Generating LLC, NRG Texas LP and NRG South Texas LP
only the following property and assets of such Subsidiaries shall be considered Core Collateral
hereunder: (a) Louisiana Generating LLC’s 100% Project Interest in Units 1 and 2 and 58% Project
Interest in Unit 3 of the Big Cajun II Facility, (b) NRG Texas LP Project Interest in the Parish
and Limestone Facilities, (c) NRG South Texas LP’s 44% Project Interest in the South Texas Project
Facility and (d) in each case any assets related primarily to any of the Facilities described in
clause (a), (b) or (c); provided further, that “Core Collateral” shall not include
any South Central Securitization Assets that are sold to a Securitization Vehicle in a South
Central Securitization in accordance with the provisions of this Agreement; and provided, further,
however, that at any time and from time to time, the Borrower may deliver to the Administrative
Agent an officer’s certificate designating Core Collateral having an aggregate Fair Market Value
not in excess of $900,000,000 in the aggregate, valued at the Fair Market Value of such Core
Collateral at the time such designation is made, as no longer being Core Collateral, and
thereafter, such Equity Interests or property or assets shall no longer be considered Core
Collateral for any purpose hereunder.



     “Core Collateral Subsidiary” shall mean each of Louisiana Generating LLC, Huntley
Power LLC, Dunkirk Power LLC, Indian River Power LLC, Oswego Harbor Power LLC, Astoria Gas Turbine
LLC, Arthur Kill Power LLC, NRG Texas LP, NRG South Texas LP and NRG Power Marketing.



     “Default” shall mean any event or condition which upon notice, lapse of time (pursuant
to Article VII) or both would constitute an Event of Default.



     “Deposit Account” shall have the meaning assigned to such term in the UCC.



     “Designated Country” shall mean Australia, Austria, Belgium, Canada, Denmark, Finland,
France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, New Zealand, Norway,
Portugal, Spain, Sweden, Switzerland, the United Kingdom, the United States and any other country
that shall at any time after the Closing Date become a member state of the European Union.



     “Designated Non-Recourse Indebtedness” shall mean the Non-Recourse Indebtedness of NRG
Peaker Finance Co. LLC, as amended from time to time (provided that such amendments do not result
in the incurrence of additional Indebtedness for borrowed money (on account of principal) in excess
of the principal amounts of such Indebtedness outstanding as of the Closing Date and are otherwise
in compliance with the terms hereof).



     “Disqualified Stock” shall mean any Capital Stock that, by its terms (or by the terms
of any security into which it is convertible, or for which it is exchangeable, in each case at the
option of the holder of the Capital Stock), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the
option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91
days after the Term Loan Maturity Date. Notwithstanding the preceding sentence, any Capital Stock
that would constitute Disqualified Stock solely because the holders of the Capital Stock have the
right to require the Borrower to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock
provide that the Borrower may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 6.06 hereof. The amount of
Disqualified Stock deemed to be outstanding at any time for purposes of this Agreement will be the
maximum amount that the Borrower and its Restricted Subsidiaries may become obligated to pay upon
the maturity of, or pursuant to any mandatory redemption provisions of, such Disqualified Stock,
exclusive of accrued dividends.



15









 





     “Dividends” shall have the meaning provided in Section 6.06.



     “dollars” or “$” shall mean lawful money of the United States of America,
except when expressly used in reference to the lawful money of another country.



     “Domestic Subsidiaries” shall mean all Subsidiaries incorporated, formed or organized
under the laws of the United States of America, any State thereof or the District of Columbia.



     “Downgrade Event” shall have the meaning assigned to such term in the definition of
“Applicable Margin”.



     “ECF Period” shall mean (a) in the event that the Borrower shall exercise its option
under (and in accordance with) Section 2.13(d) to calculate Excess Cash Flow (and make the required
prepayment and prepayment offer) for any fiscal period other than a fiscal year, (i) each such
fiscal period and (ii) each fiscal period during the applicable fiscal year that is not a fiscal
period described in the preceding clause (i) and (b) in the event that the Borrower shall not
exercise such option during any fiscal year, a fiscal year. For purposes of this definition,
“fiscal period” shall mean a period of one or more consecutive fiscal quarters.



     “Easement” shall have the meaning assigned to such term in Section 3.07.



     “Eligible Commodity Hedging Agreement” shall mean any Commodity Hedging Agreement
entered into by any Opco Loan Party with an Eligible Commodity Hedging Counterparty from time to
time in order to manage fluctuations in the price or availability to the Borrower or any Restricted
Subsidiary of any commodity, which, individually or together with other Commodity Hedging
Agreements (other than Commodity Hedging Agreements that are either unsecured, are supported by
letters of credit or Guarantees (but not secured by all or substantially all of the assets of any
Opco Loan Party) or constitute Parity Lien Obligations) entered into or being entered into with
such counterparty or its affiliates, is structured such that the net mark-to-market credit exposure
of (a) the counterparties to such Commodity Hedging Agreements (taken as a whole) to (b) the
Company or any other Opco Loan Party, is positively correlated with the price of the relevant
commodity or positively correlated with changes in the relevant spark spread.



     “Eligible Commodity Hedging Counterparty” shall mean a counterparty to an Eligible
Commodity Hedging Agreement that, at the time the relevant Eligible Commodity Hedging Agreement is
entered into, is either an Acceptable Power Counterparty or an Acceptable Financial Counterparty.



     “Eligible Commodity Hedging Obligations” shall mean, with respect to any specified
Person, the obligations of such Person under an Eligible Commodity Hedging Agreement.



     “Environmental CapEx Debt” shall mean Indebtedness of the Borrower or the Restricted
Subsidiaries incurred for the purpose of financing Environmental Capital Expenditures.



     “Environmental Capital Expenditures” shall mean capital expenditures to the extent
deemed reasonably necessary, as determined by the Borrower or the Restricted Subsidiaries, as
applicable, in good faith and pursuant to prudent judgment, to comply with applicable Environmental
Laws.



     “Environmental Laws” shall mean all former, current and future Federal, state, local
and foreign laws (including common law), treaties, regulations, rules, ordinances and codes, and
legally binding decrees, judgments, directives and orders (including consent orders), in each case,
relating to protection of the environment, natural resources, occupational health and safety or the
presence, Release of, or



16









 







exposure to, hazardous materials, substances or wastes, or the generation, manufacture,
processing, distribution, use, treatment, storage, disposal, transport, recycling or handling of,
or the arrangement for such activities with respect to, hazardous materials, substances or wastes.



     “Environmental Liability” shall mean all liabilities, obligations, damages, losses,
claims, actions, suits, judgments, orders, fines, penalties, fees, expenses and costs (including
administrative oversight costs, natural resource damages and remediation costs), whether contingent
or otherwise, arising out of or relating to (a) non-compliance with any Environmental Law, (b) the
generation, manufacture, processing, distribution, recycling, use, handling, transportation,
storage, treatment or disposal of, or the arrangement of such activities with respect to, any
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release of any Hazardous
Materials at or from any location or (e) any contract or agreement pursuant to which liability is
assumed, imposed or covered by an indemnity with respect to any of the foregoing.



     “Equally and Ratably” shall have the meaning assigned to such term in the applicable
Collateral Trust Agreement.



     “Equity Interests” shall mean Capital Stock and all warrants, options or other rights
to acquire Capital Stock (but excluding, except for purposes of the definitions of “Additional
Non-Recourse Indebtedness”, “Existing Non-Recourse Indebtedness” and “Net Cash Proceeds”, any debt
security that is convertible into, or exchangeable for, Capital Stock).



     “ERCOT” shall mean the Electric Reliability Council of Texas or any other entity
succeeding thereto.



     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended
from time to time.



     “ERISA Affiliate” shall mean any trade or business (whether or not incorporated) that,
together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Tax
Code, or solely for purposes of Section 302 of ERISA and Section 412 of the Tax Code, is treated as
a single employer under Section 414 of the Tax Code.



     “ERISA Event” shall mean (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder, with respect to a Benefit Plan (other than an event for
which the 30-day notice period is waived); (b) the existence with respect to any Benefit Plan of an
“accumulated funding deficiency” (as defined in Section 412 of the Tax Code or Section 302 of
ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Tax Code or Section
303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any
Benefit Plan; (d) the incurrence by the Borrower or any ERISA Affiliate of any liability under
Title IV of ERISA with respect to the termination of any Benefit Plan or the withdrawal or partial
withdrawal of the Borrower or any ERISA Affiliate from any Benefit Plan or Multiemployer Plan; (e)
the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to the intention to terminate any Benefit Plan or to appoint a trustee to
administer any Benefit Plan; (f) the adoption of any amendment to a Benefit Plan that would require
the provision of security pursuant to Section 401(a)(29) of the Tax Code or Section 307 of ERISA;
or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the
imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected
to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.



17









 





     “Eurodollar”, when used in reference to any Term Loan or Borrowing, refers to whether
such Term Loan, or the Term Loans comprising such Borrowing, are bearing interest at a rate
determined by reference to the Adjusted LIBO Rate.



     “Event of Default” shall have the meaning assigned to such term in Article VII.



     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.



     “Excess Cash Flow” shall mean, for any period, an amount equal to the excess of (a)
the sum, without duplication, of:




     (i) Consolidated Net Income of the Company for such period;




     (ii) an amount equal to the amount of all non-cash charges to the extent deducted in
arriving at such Consolidated Net Income;




     (iii) decreases in Consolidated Working Capital for such period;




     (iv) an amount equal to the aggregate net non-cash loss on the sale, lease, transfer or
other disposition of assets by the Company and its Restricted Subsidiaries during such
period (other than sales in the ordinary course of business) to the extent deducted in
arriving at such Consolidated Net Income;




     (v) to the extent not included in the determination of Consolidated Net Income, any
termination payments or similar payments received by the Company or any of its Restricted
Subsidiaries during such period in connection with the termination, partial termination or
other reduction of any Commodity Hedging Agreement; and




     (vi) any cash and Cash Equivalents that is returned to the Company and its Restricted
Subsidiaries during such period that was, immediately prior to such return, pledged or
deposited as collateral to a contract counterparty, issuer of surety bonds or issuer of
letters of credit by the Company or any of its Restricted Subsidiaries, in each case to
secure obligations with respect to (A) contracts for commercial and trading activities and
contracts (including physical delivery, option (whether cash or financial), exchange, swap
and futures contracts) for the purchase, transmission, transportation, distribution, sale,
lease or hedge of any fuel-related or power-related commodity or service or (B) Commodity
Hedging Agreements;




over (b) the sum, without duplication, of:




     (i) an amount equal to the amount of all non-cash credits included in arriving at such
Consolidated Net Income;




     (ii) the aggregate amount actually paid by the Company and its Restricted Subsidiaries
in cash during such period on account of Capital Expenditures (to the extent financed with
cash flow internally generated within such period by the Company and its Restricted
Subsidiaries), and including Necessary Capital Expenditures and Environmental Capital
Expenditures;




     (iii) the aggregate amount of all prepayments of Revolving Loans and Swingline Loans
(each as defined in the Opco Credit Agreement on the date hereof) made during such period to
the extent accompanying reductions of the Total Revolving Credit Commitment (as



18









 






defined in the Opco Credit Agreement on the date hereof) except to the extent financed
with the proceeds of other Indebtedness of the Company or its Restricted Subsidiaries;




     (iv) (A) the aggregate amount of all principal payments of Indebtedness of the Company
or its Restricted Subsidiaries (including any Term Loans (as defined in the Opco Credit
Agreement on the date hereof) and the principal component of payments in respect of Capital
Lease Obligations but excluding Revolving Loans (as defined in the Opco Credit Agreement on
the date hereof), Swingline Loans (as defined in the Opco Credit Agreement on the date
hereof), voluntary prepayments of Term Loans pursuant to Section 2.12 of the Opco Credit
Agreement and mandatory prepayments of Term Loans pursuant to Section 2.13 of the Opco
Credit Agreement) made during such period (other than in respect of any revolving credit
facility to the extent there is not an equivalent permanent reduction in commitments
thereunder), except to the extent financed with the proceeds of other Indebtedness of the
Company or its Restricted Subsidiaries;




     (v) an amount equal to the aggregate net non-cash gain on the sale, lease, transfer or
other disposition of assets by the Company and its Restricted Subsidiaries during such
period (other than sales in the ordinary course of business) to the extent included in
arriving at such Consolidated Net Income;




     (vi) increases in Consolidated Working Capital for such period;




     (vii) payments by the Company and its Restricted Subsidiaries during such period in
respect of long-term liabilities of the Company and its Restricted Subsidiaries other than
Indebtedness;




     (viii) the amount of Investments made during such period pursuant to Section 6.05 to
the extent that such Investments were financed with cash flow internally generated within
such period by the Company and its Restricted Subsidiaries;




     (ix) the aggregate amount of expenditures actually made by the Company and its
Restricted Subsidiaries in cash during such period (including expenditures for the payment
of financing fees) to the extent that such expenditures are not expensed during such period;




     (x) the aggregate amount of any premium, make-whole or penalty payments actually paid
in cash by the Company and its Restricted Subsidiaries during such period that are required
to be made in connection with any prepayment of Indebtedness and that are accounted for as
extraordinary items;




     (xi) to the extent not included in the determination of Consolidated Net Income, any
termination payments or similar payments made by the Company or any of its Restricted
Subsidiaries during such period in connection with the termination, partial termination or
other reduction of any Commodity Hedging Agreement (but in any case for purposes of
calculating Excess Cash Flow for the fiscal year ending on December 31, 2006, excluding any
such payments made in connection with the Transactions (as defined in the Opco Credit
Agreement on the date hereof) described in clause (b)(iv) of the definition of
“Transactions” (as defined in the Opco Credit Agreement on the date hereof));




     (xii) to the extent not included in the determination of Consolidated Net Income, the
aggregate amount of pension plan contributions required by law and actually made in cash by
the



19









 






Company or any of its Restricted Subsidiaries during such period in connection with the
Texas Genco Retirement Plan;




     (xiii) to the extent not included in the determination of Consolidated Net Income, the
aggregate amount of expenditures actually made by the Company and its Restricted
Subsidiaries relating to the acquisition of nuclear fuel;




     (xiv) to the extent not included in the determination of Consolidated Net Income, any
fees, costs and expenses incurred in connection with the transactions permitted by Section
9.22 of the Opco Credit Agreement (as it exists on the date hereof); and




     (xv) any cash and Cash Equivalents pledged or deposited the Company and its Restricted
Subsidiaries during such period as collateral to a contract counterparty, issuer of surety
bonds or issuer of letters of credit, in each case to secure obligations with respect to (A)
contracts for commercial and trading activities and contracts (including physical delivery,
option (whether cash or financial), exchange, swap and futures contracts) for the purchase,
transmission, transportation, distribution, sale, lease or hedge of any fuel-related or
power-related commodity or service or (B) Commodity Hedging Agreements.



     “Excluded Assets” shall, at any time, have the meaning given to such term in the Opco
Credit Agreement at such time, and, if at any time the Indebtedness (other than contingent
obligations not then due and payable) under the Opco Credit Agreement shall cease to be
outstanding, shall have the meaning given to such term in the Opco Credit Agreement immediately
prior to the termination thereof (which definition shall be incorporated herein by reference).



     “Excluded Foreign Subsidiaries” shall mean (a) at any time that any Indebtedness
(other than contingent obligations not then due and payable) under the Opco Credit Agreement shall
be outstanding, those subsidiaries of the Company that shall be designated as “Excluded Foreign
Subsidiaries” under (and in accordance with) the Opco Credit Agreement at such time (for so long as
such designation is effective pursuant to the Opco Credit Agreement) and (b) at any time that the
Indebtedness (other than contingent obligations not then due and payable) under the Opco Credit
Agreement shall cease to be outstanding, those subsidiaries of the Company that were most recently
designated as “Excluded Foreign Subsidiaries” under (and in accordance with) the Opco Credit
Agreement immediately prior to the termination thereof.



     “Excluded Perfection Assets” shall mean any property or assets (i) that do not have a
Fair Market Value at any time exceeding $10,000,000 (or, if such property or asset is a Deposit
Account or Securities Account, $3,000,000) individually or $50,000,000 in the aggregate in which a
security interest cannot be perfected by the filing of a financing statement under the UCC of the
relevant jurisdiction or, in the case of Equity Interests, either the filing of a financing
statement under the UCC of the relevant jurisdiction or the possession of certificates representing
such Equity Interests, (ii) that constitute leasehold interests of the Borrower in real property
(other than any real property constituting a Facility) or (iii) that constitute any Deposit Account
that is a “zero-balance” account (as long as (x) the balance in such “zero-balance” account does
not exceed at any time the applicable threshold described in clause (i) above for a period of 24
consecutive hours or more and (y) all amounts in such “zero-balance” account shall either be swept
on a daily basis into another Deposit Account that does not constitute an Excluded Perfection Asset
or used for third party payments in the ordinary course of business). To the extent that the Fair
Market Value of any such property or asset exceeds $10,000,000 (or, if such property or asset is a
Deposit Account or Securities Account, $3,000,000) individually, such property or asset shall cease
to be an Excluded Perfection Asset and, to the extent that the Fair Market Value of such property
or assets shall exceed $50,000,000 in the aggregate at any time, such property or assets shall
cease to be Excluded Perfection Assets to the extent of such excess Fair Market Value.



20









 





     “Excluded Project Subsidiaries” shall mean (a) at any time that any Indebtedness
(other than contingent obligations not then due and payable) under the Opco Credit Agreement shall
be outstanding, those subsidiaries of the Company that shall be designated as “Excluded Project
Subsidiaries” under (and in accordance with) the Opco Credit Agreement at such time (for so long as
such designation is effective pursuant to the Opco Credit Agreement) and (b) at any time that the
Indebtedness (other than contingent obligations not then due and payable) under the Opco Credit
Agreement shall cease to be outstanding, those subsidiaries of the Company that were most recently
designated as “Excluded Project Subsidiaries” under (and in accordance with) the Opco Credit
Agreement immediately prior to the termination thereof; provided that the Company may
continue to designate (and re-designate) any such subsidiaries of the Company as an “Excluded
Project Subsidiary” in accordance with (and subject to) Section 6.11 of the Opco Credit Agreement
as it existed immediately prior to the termination thereof (the provisions of which shall be
incorporated herein by reference).



     “Excluded Subsidiary” shall mean (a) at any time that any Indebtedness (other than
contingent obligations not then due and payable) under the Opco Credit Agreement shall be
outstanding, those subsidiaries of the Company that shall be designated as “Excluded Subsidiaries”
under (and in accordance with) the Opco Credit Agreement at such time (for so long as such
designation is effective pursuant to the Opco Credit Agreement) and (b) at any time that the
Indebtedness (other than contingent obligations not then due and payable) under the Opco Credit
Agreement shall cease to be outstanding, those subsidiaries of the Company that were most recently
designated as “Excluded Subsidiaries” under (and in accordance with) the Opco Credit Agreement
immediately prior to the termination thereof; provided that the Company may continue to
designate (and re-designate) any such subsidiaries of the Company as an Excluded Subsidiary in
accordance with (and subject to) Section 6.11 of the Opco Credit Agreement as it existed
immediately prior to the termination thereof (the provisions of which shall be incorporated herein
by reference).



     “Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender and
any other recipient of any payment to be made by or on account of any obligation of the Borrower
hereunder, (a) income or franchise taxes imposed on (or measured in whole or in part by) each such
Person’s net income by the United States of America (or any political subdivision thereof), or as a
result of a present or former connection between such recipient and the jurisdiction imposing such
tax (or any political subdivision thereof), other than any such connection arising solely from such
recipient having executed, delivered or performed its obligations or received a payment under, or
enforced, this Agreement or any other Loan Document and (b) in the case of a Foreign Lender (other
than an assignee pursuant to a request by the Borrower under Section 2.21(a)), any United States
withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender’s failure to comply with Section 2.20(e), except to the extent that such
Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending
office (or assignment), to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 2.20(a) or (b) (it being understood and agreed, for the
avoidance of doubt, that any withholding tax imposed on a Foreign Lender as a result of a Change in
Law or regulation or interpretation thereof occurring after the time such Foreign Lender became a
party to this Agreement shall not be an Excluded Tax).



     “Exempt Subsidiaries” shall mean, collectively, NRG Ilion LP LLC, NRG Ilion Limited
Partnership, Meriden Gas Turbine LLC, LSP-Nelson Energy LLC, NRG Nelson Turbines LLC, NRG Jackson
Valley Energy I, Inc., NRG McClain LLC, NRG Audrain Holding LLC, NRG Audrain Generating LLC, NRG
Peaker Finance Company LLC, Bayou Cove Peaking Power, LLC, Big Cajun I Peaking Power LLC, NRG
Rockford LLC, NRG Rockford II LLC, NRG Rockford Equipment II LLC, NRG Sterlington Power LLC and NRG
Rockford Acquisition LLC, and shall not, in any event, include any Core Collateral Subsidiary.



21









 





     “Existing Commodity Hedging Agreements” shall mean (i) the Master Power Purchase and
Sale Agreement and Cover Sheet dated as of July 21, 2004, the Confirmation thereunder dated as of
July 21, 2004 and the Confirmation thereunder dated as of November 30, 2004, each between J. Aron &
Company and NRG Texas LP (as successor by merger), and any additional confirmations thereunder, as
the same may be amended, supplemented, replaced or otherwise modified from time to time in
accordance with the terms hereof and thereof, (ii) the Master Power Purchase and Sale Agreement and
Cover Sheet dated as of December 1, 2004 and the Confirmation thereunder dated as of December 2,
2004, each between Morgan Stanley Capital Group Inc. and NRG Texas LP (as successor by merger), and
any confirmation of any relevant transaction thereunder, as the same may be amended, supplemented,
replaced or otherwise modified from time to time in accordance with the terms hereof and thereof
and (iii) any other master agreement listed on Schedule 1.01(c), and any confirmations thereunder,
as the same may be amended, supplemented or otherwise modified from time to time in accordance with
the terms hereof and thereof.



     “Existing Indebtedness” shall mean Indebtedness of the Borrower, the Company and/or
any of their respective subsidiaries (other than Indebtedness under the Senior Note Documents) in
existence on the Closing Date and set forth on Schedule 6.01, until such amounts are repaid, or are
refunded, refinanced, replaced, defeased or discharged pursuant to Section 6.01(e) hereof.



     “Existing Non-Recourse Indebtedness” shall mean secured or unsecured Indebtedness for
borrowed money outstanding as of the Closing Date of a subsidiary of the Company that is not an
Opco Loan Party existing as of the Closing Date and any Permitted Refinancing Indebtedness in
respect of such Indebtedness; provided that, except as set forth on Schedule 1.01(e),




     (a) such Indebtedness is without recourse to the Borrower, the Company or any other
Restricted Subsidiary or to any property or assets of the Borrower, the Company or any other
Restricted Subsidiary (other than, in each such case, another Restricted Subsidiary (other
than the Company) (x) which is the direct parent or a direct or indirect Subsidiary of the
Subsidiary that incurred or issued such Indebtedness (other than such Indebtedness
constituting a Guarantee) or (y) that is a Subsidiary that itself has Non-Recourse
Indebtedness (other than such Indebtedness constituting a Guarantee) or is the direct parent
or a direct or indirect Subsidiary of a Subsidiary that itself has Non-Recourse Indebtedness
(other than such Indebtedness constituting a Guarantee)),




     (b) neither the Borrower, the Company nor any other Restricted Subsidiary (other than
another Restricted Subsidiary (other than the Company) (x) which is the direct parent or a
direct or indirect subsidiary of the Subsidiary that incurred or issued such Indebtedness
(other than such Indebtedness constituting a Guarantee) or (y) that is a subsidiary that
itself has Non-Recourse Indebtedness (other than such Indebtedness constituting a Guarantee)
or is the direct parent or a direct or indirect subsidiary of a Subsidiary that itself has
Non-Recourse Indebtedness (other than such Indebtedness constituting a Guarantee) provides
credit support of any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness) or is directly or indirectly liable as a guarantor or otherwise in
respect of such Indebtedness or in respect of the business or operations of the applicable
Subsidiary that is the obligor on such Indebtedness or any of its subsidiaries (other than
(i) any such credit support or liability consisting of reimbursement obligations in respect
of letters of credit issued under, and subject to the terms of, the Opco Credit Agreement to
support obligations of such applicable subsidiary and (ii) any Investments in such
applicable subsidiary made in accordance with Section 6.05),




     (c) no default with respect to such Indebtedness (including any rights that the holders
of such Indebtedness may have to take enforcement action against a subsidiary of the Company
that is not an Opco Loan Party) would permit upon notice, lapse of time or both any holder
of any



22









 






other Indebtedness of the Borrower, the Company or any other Opco Loan Party (other
than Indebtedness incurred pursuant to Section 6.01(a), (b), (c) or (k)) to declare a
default on such other Indebtedness or cause the payment of the Indebtedness to be
accelerated or payable prior to its stated maturity and




     (d) the Liens securing such Indebtedness shall exist only on (i) the property and
assets of any subsidiary of the Company that is not an Opco Loan Party and (ii) the Equity
Interests in any subsidiary of the Company that is not an Opco Loan Party (and shall not
apply to any other property or assets of the Borrower, the Company or any other Subsidiary
of the Company that is an Opco Loan Party), except, in the case of each of clauses (a) and
(b) for the following (each of which is deemed to be non-recourse for purposes of this
definition): (w) Guarantees by the Company or any other Subsidiary of the Company of such
Indebtedness that are incurred pursuant to Section 6.01(p), (x) agreements of the Company or
any other Subsidiary of the Company to provide corporate or management services or operation
and maintenance services to such Subsidiary, including in respect of the acquisition of
fuel, oil, gas or other supply of energy, (y) Guarantees of the Company or any other
Subsidiary of the Company with respect to debt service reserves established with respect to
such Subsidiary to the extent that such Guarantee shall result in the immediate payment of
funds, pursuant to dividends or otherwise, in the amount of such Guarantee to the Company or
such other Subsidiary and (z) contingent obligations of the Company or any other Subsidiary
of the Company to make capital contributions to such Subsidiary, in the case of each of
clauses (x), (y) and (z), which are otherwise permitted hereunder.



     “Facility” shall mean a power or energy related facility.



     “Fair Market Value” shall mean the value that would be paid by a willing buyer to an
unaffiliated willing seller in a transaction not involving distress of either party, determined in
good faith by (i) the Board of Directors of the Borrower (or any committee thereof expressly
authorized by the Board of Directors) with respect to assets and Investments having a Fair Market
Value of $100,000,000 or more and (ii) the Chief Financial Officer of the Borrower with respect to
assets and Investments having a Fair Market Value less than $100,000,000.



     “Federal Funds Effective Rate” shall mean, for any day, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that is a Business Day, the
average of the quotations for the day for such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by it.



     “Fee Letter” shall mean that certain amended and restated fee letter, dated as of June
7, 2007, among the Company, the Administrative Agent and each of the Arrangers, as the same may be
amended, restated, supplemented or otherwise modified from time to time in accordance with the
terms thereof.



     “Fees” shall mean the Commitment Fees, the Administrative Agent’s Fees and any fees
payable pursuant to Section 2.12(d).



     “FERC” shall mean the Federal Energy Regulatory Commission or its successor.



     “Financial Officer” of any Person shall mean any of the chief executive officer, chief
financial officer or treasurer (or if no individual shall have such designation, the Person charged
by the Board of



23









 







Directors of such Person with such powers and duties as are customarily bestowed upon the
individual with such designation) or the audit or finance committee of the Board of Directors of
such Person.



     “Fitch” shall mean Fitch Ratings, Ltd. or any successor entity.



     “Foreign Lender” shall mean any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is incorporated or organized. For purposes of
this definition, the United States of America, each State thereof and the District of Columbia
shall be deemed to constitute a single jurisdiction.



     “Foreign Subsidiary” shall mean any Subsidiary that is not a Domestic Subsidiary.



     “FPA” shall mean the Federal Power Act and the rules and regulations promulgated
thereunder, as amended from time to time.



     “Funding Date” shall mean the date on which the conditions specified in Section 4.02
are satisfied (or waived in accordance with Section 9.08) and the initial Term Borrowing hereunder
shall occur.



     “Funding Date Material Adverse Effect” shall mean a material adverse change in or
material adverse effect on (a) the condition (financial or otherwise), results of operations,
assets or liabilities of the Borrower and the Subsidiaries, taken as a whole, or (b) the validity
or enforceability of any Loan Document, which if such Loan Document is a Security Document, relates
to Collateral having an aggregate Fair Market Value of $50,000,000 or more in the aggregate, or the
material rights and remedies of the Arrangers, the Administrative Agent, the Collateral Agent or
the Secured Parties thereunder; provided, however, that any adverse change or
adverse effect attributable to (i) any adoption, implementation, promulgation, repeal,
modification, reinterpretation or proposal of any rule, regulation, ordinance, order, protocol or
any other law of or by any Governmental Authority (including, for the avoidance of doubt, the ERCOT
market), (ii) changes or developments in national, regional, state or local wholesale or retail
markets for power or fuel, including changes in commodity prices, related products, or availability
or costs of transportation, (iii) changes or developments in national, regional, state or local
wholesale or retail electric power prices, (iv) system-wide changes or developments in national,
regional or state electric transmission or distribution systems, other than changes or developments
involving physical damage or destruction thereto and (v) changes or developments in financial or
securities markets or the economy in general, shall, in each case, be excluded from such
determination to the extent, in the case of clauses (i) through (v), any such laws, changes and
developments do not have a disproportionate adverse effect on the Borrower and the Subsidiaries,
taken as a whole, as compared to other entities engaged in the power generation business in any of
the relevant geographic areas with respect to such laws, changes or developments, as applicable.
In addition to the foregoing, it is understood and agreed that the occurrence of any downgrade of
any ratings of any indebtedness or any securities of the Borrower and/or the Company (or the
inclusion of the Borrower and/or the Company on any “negative watch” or “negative outlook” list)
shall not, in and of themselves, constitute a Funding Date Material Adverse Effect,
provided that the facts underlying such actions may be taken into account in determining
whether a Funding Date Material Adverse Effect has occurred or not.



     “GAAP” shall mean generally accepted accounting principles set forth in the opinions
and pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as have been approved by a significant segment of the
accounting profession, which are in effect from time to time.



24









 





     “Governmental Authority” shall mean the government of the United States of America or
any other nation, any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of
government or any governmental or non-governmental authority regulating the generation and/or
transmission of energy, including ERCOT.



     “Granting Lender” shall have the meaning assigned to such term in Section 9.04(i).



     “Guarantee” shall mean a guarantee, other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or indirect, in any manner,
including by way of a pledge of assets or through letters of credit or reimbursement agreements in
respect thereof, of all or any part of any Indebtedness (whether arising by virtue of partnership
arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to
take or pay or to maintain financial statement conditions or otherwise); provided that
standard contractual indemnities which do not relate to Indebtedness shall not be considered a
Guarantee.



     “Hazardous Materials” shall mean (a) any petroleum products or byproducts, coal ash,
coal combustion by-products or waste, boiler slag, scrubber residue, flue desulfurization material,
radon gas, asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, radioactive
materials, waste or byproducts, chlorofluorocarbons and all other ozone-depleting substances and
(b) any chemical, material, substance or waste that is prohibited, limited or regulated by or
pursuant to any Environmental Law.



     “Hedging Obligations” shall mean, with respect to any specified Person, the
obligations of such Person under (a) interest rate swap agreements (whether from fixed to floating
or from floating to fixed), interest rate cap agreements and interest rate collar agreements, (b)
other agreements or arrangements designed to manage interest rates or interest rate risk, (c) other
agreements or arrangements designed to protect such Person against fluctuations in currency
exchange rates and (d) agreements (including each confirmation entered into pursuant to any master
agreement) providing for swaps, caps, collars, puts, calls, floors, futures, options, spots,
forwards, power purchase or sale agreements, fuel purchase or sale agreements, emissions credit
purchase or sales agreements, power transmission agreements, fuel transportation agreements, fuel
storage agreements, netting agreements, commercial or trading agreements, each with respect to, or
involving the purchase, transmission, distribution, sale, lease or hedge of, any energy, generation
capacity or fuel, or any other energy related commodity or service, price or price indices for any
such commodities or services or any other similar derivative agreements, and any other similar
agreements, in each case under clause (a), (b), (c) and (d), entered into by such Person, including
Commodity Hedging Obligations, Eligible Commodity Hedging Obligations and Interest Rate/Currency
Hedging Obligations.



     “Holdings Asset Sale” shall mean the direct or indirect (a) sale, lease (other than an
operating lease), sale and leaseback, lease and leaseback, assignment (other than a collateral
assignment), conveyance, transfer or other disposition (by way of merger, consolidation, casualty,
condemnation, operation of law or otherwise (other than pursuant to an event that may result in a
Recovery Event)) by the Borrower to any Person of any assets of the Borrower (including Equity
Interests); provided that (i) any asset sale or series of related asset sales described
above of assets having a value not in excess of $50,000,000 shall be deemed not to be a “Holdings
Asset Sale” for purposes of this Agreement; and (ii) each of the following transactions shall be
deemed not to be a “Holdings Asset Sale” for purposes of this Agreement: (A) the sale, transfer,
contribution or other disposition by the Borrower of (x) damaged, worn-out, obsolete assets and
scrap and (y) cash or Cash Equivalents, (B) the sale by the Borrower of power, capacity, energy,
ancillary services, and other products or services, or the sale of any other inventory or contracts
related to any of the foregoing, (C) the sale, lease, conveyance or other disposition for value by
the Borrower of fuel or emission credits in the ordinary course of business, (D) the sale,



25









 







transfer or other disposition of any assets (other than any such assets which are Collateral)
in connection with a foreclosure, transfer or deed in lieu of foreclosure or other remedial action,
(E) the licensing of intellectual property and (F) the sale or discount, in each case without
recourse, of accounts receivable arising in the ordinary course of business, but only in connection
with the compromise or collection thereof.



     “Holdings Contribution” shall mean the contribution by the Borrower of $1,000,000,000
(net of reasonable fees and expenses and any original issue discount incurred in connection with
the Borrowing hereunder) to the Company which shall be used for the prepayment of Term Loans under
and as defined in the Opco Credit Agreement.



     “Holdings Recovery Event” shall mean the receipt of cash proceeds by the Borrower with
respect to any settlement of or payment in respect of (a) any property or casualty insurance claim
or (b) any taking under power of eminent domain or by condemnation or similar proceeding of or
relating to any property or asset of the Borrower; provided that any such recovery event or
series of related recovery events having a value not in excess of $50,000,000 shall not be deemed
to be a “Holdings Recovery Event” for purposes of Section 2.13(b).



     “Holdings Reorganization” shall mean the creation by the Borrower of a wholly-owned
Subsidiary (“MergerCo”) and the merger of MergerCo with and into the Company with the
Company as the surviving corporation, such that after giving effect to such transactions, the
Borrower shall be the direct parent of, and shall directly own 100% of the issued and outstanding
Capital Stock of, the Company and the ownership of the Borrower shall be the same as the ownership
of the Company immediately prior to giving effect to the Holdings Reorganization.



     “incur” shall have the meaning assigned to such term in Section 6.01.



     “Indebtedness” shall mean, with respect to any specified Person, any indebtedness of
such Person (excluding accrued expenses and trade payables except as provided in clause (e) below),
whether or not contingent (a) in respect of borrowed money; (b) evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement agreements in respect
thereof); (c) in respect of banker’s acceptances; (d) representing Capital Lease Obligations or
Attributable Debt in respect of sale and leaseback transactions; (e) representing the balance
deferred and unpaid of the purchase price of any property (including trade payables) or services
due more than six months after such property is acquired or such services are completed; or (f)
representing Hedging Obligations, if and to the extent any of the preceding items (other than
letters of credit, Attributable Debt and Hedging Obligations) would appear as a liability upon a
balance sheet of the specified Person prepared in accordance with GAAP. In addition, the term
“Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified
Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not
otherwise included, the Guarantee by the specified Person of any Indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date will be (a) the accreted value of the
Indebtedness, in the case of any Indebtedness issued with original issue discount; (b) the
principal amount of the Indebtedness, in the case of any other Indebtedness; and (c) in respect of
Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser
of (i) the Fair Market Value of such asset at the date of determination, and (ii) the amount of the
Indebtedness of the other Person.



     “Indemnified Taxes” shall mean Taxes other than Excluded Taxes and Other Taxes.



     “Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).



     “Information” shall have the meaning assigned to such term in Section 9.16.



26









 





     “Intellectual Property Collateral” shall have the meaning assigned to such term in the
Collateral Agreement.



     “Intellectual Property Security Agreement” shall mean the Intellectual Property
Security Agreements executed and delivered by the Borrower, substantially in the applicable form
required by the Collateral Agreement, as the same may be amended, restated, supplemented or
otherwise modified from time to time in accordance with the terms hereof and thereof.



     “Interest Payment Date” shall mean (a) with respect to any ABR Term Loan, the last
Business Day of each March, June, September and December, and (b) with respect to any Eurodollar
Term Loan, the last day of the Interest Period applicable to the Borrowing of which such Term Loan
is a part and, in the case of a Eurodollar Borrowing with an Interest Period of more than three
months’ duration, each day that would have been an Interest Payment Date had successive Interest
Periods of three months’ duration been applicable to such Borrowing.



     “Interest Period” shall mean with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending seven days thereafter or on the numerically
corresponding day in the calendar month that is 1, 2, 3 or 6 months thereafter (or 9 or 12 months
thereafter if, at the time of the relevant Borrowing, an interest period of such duration is
available to all Lenders participating therein), as the Borrower may elect; provided,
however, that (i) if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless such next succeeding
Business Day would fall in the next calendar month, in which case such Interest Period shall end on
the next preceding Business Day and (ii) any Interest Period (other than an Interest Period of
seven days) that commences on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the last calendar month of such Interest Period) shall
end on the last Business Day of the last calendar month of such Interest Period. Interest shall
accrue from and including the first day of an Interest Period to but excluding the last day of such
Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.



     “Interest Rate/Currency Hedging Agreement” shall mean any agreement of the type
described in clauses (a), (b) or (c) of the definition of “Interest Rate/Currency Hedging
Obligations”.



     “Interest Rate/Currency Hedging Obligations” shall mean, with respect to any specified
Person, the obligations of such Person under (a) interest rate swap agreements (whether from fixed
to floating or from floating to fixed), interest rate cap agreements and interest rate collar
agreements, (b) other agreements or arrangements designed to manage interest rates or interest rate
risk and (c) other agreements or arrangements designed to protect such Person against fluctuations
in currency exchange rates, in each case under clause (a), (b) and (c), entered into by such Person
in the ordinary course of business and not for speculative purposes.



     “Investments” shall mean, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms of loans (including
Guarantees or other obligations), advances or capital contributions, purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with
all items that are or would be classified as investments on a balance sheet prepared in accordance
with GAAP. If the Borrower, the Company or any subsidiary of the Company sells or otherwise
disposes of any Equity Interests of any direct or indirect subsidiary such that, after giving
effect to any such sale or disposition, such Person is no longer a subsidiary, the Borrower or the
Company, as applicable, will be deemed to have made an Investment on the date of any such sale or
disposition equal to the Fair Market Value of the Borrower’s or the Company’s Investments in such
subsidiary that were not sold or disposed of. The acquisition by the



27









 







Borrower, the Company, or by any subsidiary of the Company, of a Person that holds an
Investment in a third Person will be deemed to be an Investment by the Borrower, the Company or
such subsidiary in such third Person in an amount equal to the Fair Market Value of the Investments
held by the acquired Person in such third Person. Except as otherwise provided in this Agreement,
the amount of an Investment will be determined at the time the Investment is made and without
giving effect to subsequent changes in value.



     Notwithstanding anything to the contrary herein, in the case of any Investment made by the
Borrower, the Company or any other Restricted Subsidiary in a Person substantially concurrently
with a cash distribution by such Person to the Borrower, the Company or any other Restricted
Subsidiary (a “Concurrent Cash Distribution”), then:



     (a) (x) if such Concurrent Cash Distribution is received by the Borrower, such Concurrent Cash
Distribution shall be deemed to be Net Cash Proceeds received in connection with a Holdings Asset
Sale and applied as described in Section 2.13 or (y) if such Concurrent Cash Distribution is
received by the Company or any of its Restricted Subsidiaries, such Concurrent Cash Distribution
shall be deemed to be Net Cash Proceeds received in connection with an Asset Sale (each as defined
in the Opco Credit Agreement) and applied as described in Section 2.13 of the Opco Credit Agreement
(if the Opco Credit Agreement shall be outstanding) if and to the extent required thereby; and



     (b) the amount of such Investment shall be deemed to be the Fair Market Value of the
Investment, less the amount of the Concurrent Cash Distribution.



     “Issuing Subsidiary” shall have the meaning assigned to such term in the definition of
“Additional Non-Recourse Indebtedness”.



     “Itiquira” shall mean Itiquira Energetica S.A.



     “Itiquira Acquisition Sub” shall have the meaning assigned to such term in the
definition of “Itiquira Refinancing”.



     “Itiquira Refinancing” shall mean the transaction or series of related transactions
pursuant to which (a) any or all of the outstanding preferred stock of Itiquira directly or
indirectly held by Eletrobrás is acquired by Itiquira or a subsidiary of Tosli Acquisition BV
(“Itiquira Acquisition Sub”) for aggregate consideration not to exceed $70,000,000, and,
following such acquisition, such preferred stock is redeemed, repaid or otherwise retired or held
as treasury stock or otherwise so treated in accordance with the requirements of Brazilian law, and
(b) pursuant to which Itiquira or the Itiquira Acquisition Sub may incur up to $70,000,000 in
aggregate principal amount of Indebtedness secured by Liens on the assets of Itiquira and the
Itiquira Acquisition Sub (“Permitted Itiquira Indebtedness”), in each case on terms and
conditions (which may include terms and conditions other than those set forth in this definition)
reasonably satisfactory to the Administrative Agent.



     “Lender Addendum” shall mean, with respect to any initial Lender, a Lender Addendum in
the form of Exhibit F, or such other form as may be supplied by the Administrative Agent, executed
and delivered by such Lender on the Closing Date.



     “Lenders” shall mean (a) the Persons that deliver a Lender Addendum (other than any
such Person that has ceased to be a party hereto pursuant to an Assignment and Acceptance) and (b)
any Person that has become a party hereto pursuant to an Assignment and Acceptance (other than any
such Person that has ceased to be a party hereto pursuant to an Assignment and Acceptance).



28









 





     “LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any Interest
Period, the rate per annum determined by the Administrative Agent at approximately 11:00 a.m.,
London time, on the date that is two Business Days prior to the commencement of such Interest
Period by reference to the British Bankers’ Association Interest Settlement Rates for deposits in
dollars (as set forth by the Bloomberg Information Service or any successor thereto or any other
service selected by the Administrative Agent which has been nominated by the British Bankers’
Association as an authorized information vendor for the purpose of displaying such rates) for a
period equal to such Interest Period; provided that, to the extent that an interest rate is
not ascertainable pursuant to the foregoing provisions of this definition, the “LIBO Rate” shall be
the interest rate per annum determined by the Administrative Agent to be the average of the rates
per annum at which deposits in dollars are offered for such relevant Interest Period to major banks
in the London interbank market in London, England by the Administrative Agent at approximately
11:00 a.m. (London time) on the date that is two Business Days prior to the beginning of such
Interest Period.



     “Lien” shall mean, with respect to any asset (a) any mortgage, deed of trust, deed to
secure debt, lien (statutory or otherwise), pledge, hypothecation, encumbrance, restriction,
collateral assignment, charge or security interest in, on or of such asset; (b) the interest of a
vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement
(or any financing lease having substantially the same economic effect as any of the foregoing)
relating to such asset; and (c) in the case of Equity Interests or debt securities, any purchase
option, call or similar right of a third party with respect to such Equity Interests or debt
securities. For the avoidance of doubt, “Lien” shall not be deemed to include licenses of
intellectual property.



     “Loan Documents” shall mean this Agreement, any promissory note delivered pursuant to
Section 2.04(e), the Security Documents and any Affiliate Subordination Agreement.



     “Mandatory Convertible Preferred Stock” shall mean the 2,000,000 shares of 5.750%
mandatory convertible preferred stock, liquidation value $250 per share, of the Company (or,
following the Holdings Reorganization, the Borrower) issued on the Closing Date to fund a portion
of the Acquisition Consideration (as defined in the Opco Credit Agreement on the date hereof).



     “Margin Stock” shall have the meaning assigned to such term in Regulation U.



     “Mark-to-Market Adjustments” means: (a) any non-cash loss attributable to the
mark-to-market movement in the valuation of Hedging Obligations (to the extent the cash impact
resulting from such loss has not been realized) or other derivative instruments pursuant to
Financial Accounting Standards Board Statement No. 133, “Accounting for Derivative Instruments and
Hedging Activities;” plus (b) any loss relating to amounts paid in cash prior to the stated
settlement date of any Hedging Obligation that has been reflected in Consolidated Net Income in the
current period; plus (c) any gain relating to Hedging Obligations associated with
transactions recorded in the current period that has been reflected in Consolidated Net Income in
prior periods and excluded from Consolidated EBITDA pursuant to clauses (e) and (f) below;
minus (d) any non-cash gain attributable to the mark-to-market movement in the valuation of
Hedging Obligations (to the extent the cash impact resulting from such gain has not been realized)
or other derivative instruments pursuant to Financial Accounting Standards Board Statement No. 133,
“Accounting for Derivative Instruments and Hedging Activities;” minus (e) any gain relating
to amounts received in cash prior to the stated settlement date of any Hedging Obligation that has
been reflected in Consolidated Net Income in the current period; minus (f) any loss
relating to Hedging Obligations associated with transactions recorded in the current period that
has been reflected in Consolidated Net Income in prior periods and excluded from Consolidated
EBITDA pursuant to clauses (b) and (c) above.



29









 





     “Material Adverse Effect” shall mean a material adverse change in or material adverse
effect on (a) the condition (financial or otherwise), results of operations, assets or liabilities
of the Borrower and the Subsidiaries, taken as a whole, or (b) the validity or enforceability of
any Loan Document, which if such Loan Document is a Security Document, relates to Collateral having
an aggregate Fair Market Value of $50,000,000 or more in the aggregate, or the material rights and
remedies of the Arrangers, the Administrative Agent, the Collateral Agent or the Secured Parties.



     “Material Indebtedness” shall mean Indebtedness for money borrowed (other than the
Term Loans) and Hedging Obligations of any one or more of the Borrower or any of the Subsidiaries
in an aggregate principal amount or mark-to-market adjustment value exceeding $90,000,000.



     “Maximum Rate” shall have the meaning assigned to such term in Section 9.09.



     “MergerCo” shall have the meaning assigned to such term in the definition of “Holdings
Reorganization”.



     “Minority Investment” shall mean any Person (other than a Subsidiary) in which the
Borrower, the Company or any other Restricted Subsidiary owns Capital Stock.



     “Moody’s” shall mean Moody’s Investors Service, Inc. or any successor entity.



     “Mortgaged Properties” shall mean each parcel of real property and improvements
located thereon (if any) with respect to which a Mortgage is granted pursuant to Section 5.09 or
5.10.



     “Mortgages” shall mean the mortgages, deeds of trust, leasehold mortgages, assignments
of leases and rents, modifications, amendments and restatements of the foregoing and other security
documents granting a Lien on any Mortgaged Property (if any) to secure the obligations under this
Agreement, each in the form of Exhibit G with such changes as are reasonably satisfactory to the
Borrower (which shall be evidenced by the signature thereof by the Borrower) and the Collateral
Agent, as the same may be amended, restated, supplemented or otherwise modified from time to time
in accordance with the terms thereof.



     “Multiemployer Plan” shall mean a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.



     “Necessary CapEx Debt” shall mean Indebtedness of the Borrower or the Restricted
Subsidiaries incurred for the purpose of financing Necessary Capital Expenditures.



     “Necessary Capital Expenditures” shall mean capital expenditures (other than
Environmental Capital Expenditures) that are required by Applicable Law or are undertaken for
health and safety reasons. The term “Necessary Capital Expenditures” does not include any capital
expenditure undertaken primarily to increase the efficiency of, expand or re-power any power
generation facility.



     “Net Asset Sale Proceeds” shall have the meaning assigned to such term in the
definition of Net Cash Proceeds.



     “Net Cash Proceeds” shall mean




     (a) with respect to any Holdings Asset Sale or Holdings Recovery Event, the proceeds
thereof in the form of cash as and when received (including any such cash proceeds
subsequently received (as and when received) in respect of noncash consideration initially
received), net of



30









 






(i) all expenses related to such Holdings Asset Sale or Holdings Recovery Event
(including legal, accounting and investment banking fees, broker’s fees and sales
commissions, relocation fees and expenses paid or reasonably estimated by the Borrower to be
payable, and taxes paid or payable by the Borrower in connection therewith, and the
Borrower’s good faith estimate of any other taxes to be paid or payable in connection with
such Holdings Asset Sale or Holdings Recovery Event, after taking into account any available
tax credits or deductions and any tax sharing arrangements, and any out-of-pocket costs of
remediation, repair or closure required to be incurred by the Borrower by the applicable
Governmental Authority in connection with such Holdings Recovery Event), (ii) amounts
remitted in an escrow or provided as a reserve, in accordance with GAAP or the corresponding
transaction agreements or otherwise reasonably estimated to be payable to third parties and
attributable to such Holdings Asset Sale, against any liabilities under any indemnification
obligations or purchase price adjustment or otherwise associated with such asset or Holdings
Asset Sale, including pension and post-employment benefit liabilities and liabilities
related to Environmental Laws or against any other indemnification obligations related to
such transaction (provided that, to the extent and at the time any such amounts are
released from such reserve or escrow to the benefit of the Borrower, such amounts shall
constitute Net Cash Proceeds if otherwise described as such in this definition) and (iii)
the principal amount, premium or penalty, if any, interest and other amounts on any
Indebtedness (other than any such Indebtedness hereunder or assumed by the purchaser of such
asset or any Affiliate thereof) which is secured by the asset transferred, taken or sold in
such Holdings Asset Sale or Holdings Recovery Event and which is required to be repaid with
such proceeds (such proceeds with respect to any Holdings Asset Sale, “Net Asset Sale
Proceeds”);




     provided, however, that if (x) the Borrower reinvests an amount equal
to such proceeds in an acquisition by the Borrower of a Person or line of business in
accordance with the terms of this Agreement or productive assets of a kind then used or
usable in the business of the Borrower and the Restricted Subsidiaries within 365 days of
receipt of such proceeds (such period, the “Reinvestment Period”) (provided
that (i) in the event approval of any Governmental Authority is required to be procured in
connection with the reinvestment of such proceeds, the Reinvestment Period shall be extended
for an additional period not to exceed 180 days as necessary to obtain such approval and
(ii) in the event the Borrower enters into a legally binding commitment to reinvest such
proceeds within such 365-day period, the Reinvestment Period shall be extended for an
additional period not to exceed 365 days) and (y) no Event of Default has occurred and is
continuing at the time of the application of such proceeds (both immediately before and
immediately after giving effect to such application) and (z) such proceeds (1) resulting
from the sale of the Equity Interests in any Person that is incorporated, formed or
organized under the laws of the United States of America, any State thereof or the District
of Columbia (other than a Foreign Subsidiary Holding Company) (a “U.S. Person”) or any other
assets located in the United States are only used to make an acquisition of a Person that
will, following the consummation of such acquisition, be a Domestic Subsidiary or an
acquisition of other assets that are located in the United States or (2) resulting from the
sale of the Equity Interests in any Person other than a U.S. Person are only used to make an
acquisition of a Person that is incorporated, formed or organized under the laws of a
Designated Country or an acquisition of other assets that are located in a Designated
Country, then such proceeds shall not be deemed Net Cash Proceeds that are subject to the
mandatory prepayment provisions of Section 2.13 except to the extent not so used at the end
of the Reinvestment Period, at which time such proceeds shall be deemed Net Cash Proceeds
that are subject to the mandatory prepayment provisions of Section 2.13; and




     provided further, however, that if (A) such proceeds result from a Holdings Asset Sale
or Holdings Recovery Event to the extent involving assets, rights or other property of a
Restricted Subsidiary that is not an Opco Loan Party, (B) the terms of any Indebtedness of
such Restricted



31









 






Subsidiary require that an amount equal to the amount of such proceeds be applied to
repay such Indebtedness, (C) the Borrower uses an amount equal to the amount of such
proceeds to repay such Indebtedness of such Restricted Subsidiary solely to the extent
required thereby and, if such repaid Indebtedness is revolving credit Indebtedness, to
correspondingly reduce commitments with respect thereto, within 365 days of receipt of such
proceeds and (D) no Event of Default has occurred and is continuing at the time of the
application of an amount equal to such proceeds, then such amount of proceeds shall not be
deemed Net Cash Proceeds that are subject to the mandatory prepayment provisions of Section
2.13(b) except to the extent not so used at the end of such 365-day period, at which time an
amount equal to such proceeds shall be deemed Net Cash Proceeds that are subject to the
mandatory prepayment provisions of Section 2.13(b). In addition, notwithstanding the
foregoing, if the Net Asset Sale Proceeds result from one or more Holdings Asset Sales of
Equity Interests of an Excluded Project Subsidiary that does not own (directly or indirectly
through its ownership interest in any other Excluded Project Subsidiary) a Facility (other
than the Facility that is being developed, constructed or acquired with such Net Asset Sale
Proceeds), then such Net Asset Sale Proceeds shall be deemed not to be Net Cash Proceeds
that are subject to the mandatory prepayment provisions of Section 2.13(b) to the extent
that such Net Asset Sale Proceeds are used to finance the development, repowering,
construction or acquisition of such Excluded Project Subsidiary’s Facility; and




     (b) with respect to any issuance or incurrence of Indebtedness, the cash proceeds
thereof, net of any and all taxes and fees, commissions, costs and other expenses incurred
by the Borrower in connection therewith.



     “Net Income” shall mean, with respect to any specified Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in respect of preferred
stock dividends or accretion, excluding, however, (a) any gain or loss, together with any related
provision for taxes on such gain or loss, realized in connection with (i) any Asset Sale (without
giving effect to the threshold provided for in the definition thereof) or (ii) the disposition of
any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any
Indebtedness of such Person or any of its Restricted Subsidiaries; and (b) any extraordinary gain
(but not loss), together with any related provision for taxes on such extraordinary gain (but not
loss).



     “Non-Consenting Lender” shall have the meaning assigned to such term in Section
9.08(c).



     “Non-Recourse Indebtedness” shall mean (a) Existing Non-Recourse Indebtedness of any
subsidiary of the Company existing as of the Closing Date and (b) Additional Non-Recourse
Indebtedness of any subsidiary of the Company that is not an Opco Loan Party.



     “NRG Collateral Trust Agreement” shall mean the Collateral Trust Agreement dated as of
the Closing Date (as defined in the Opco Credit Agreement), executed and delivered by the Company
and each other Opco Loan Party, as the same may be amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof.



     “NRG Collateral Trustee” shall mean Deutsche Bank Trust Company Americas, acting as
collateral trustee under the NRG Collateral Trust Agreement, or its successors appointed in
accordance with the terms thereof.



     “NRG Power Marketing” shall mean NRG Power Marketing Inc., a Delaware corporation that
is a wholly owned subsidiary of the Company.



     “NYPSC” shall have the meaning assigned to such term in Section 3.23(f).



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     “NYPSC Subject Company” shall have the meaning assigned to such term in Section
3.23(f).



     “Opco Collateral” shall mean all assets of the Opco Loan Parties, now owned or
hereafter acquired, upon which a Lien is purported to be created by any Opco Loan Document from
time to time.



     “Opco Credit Agreement” shall mean the Second Amended and Restated Credit Agreement
dated as of June 8, 2007, among the Company, the lenders party thereto, Citigroup Global Markets
Inc. and Credit Suisse Securities (USA) LLC, as joint book runners and joint lead arrangers,
Citicorp North America Inc., as administrative agent and as collateral agent, and Credit Suisse, as
syndication agent, as it shall be amended, restated, supplemented, waived or otherwise modified
from time to time.



     “Opco Credit Agreement Date” shall mean November 21, 2006.



     “Opco Lenders” shall mean the “Lenders” from time to time under (and as defined in)
the Opco Credit Agreement.



     “Opco Loan Documents” shall mean the “Loan Documents” as defined in the Opco Credit
Agreement.



     “Opco Loan Party” shall mean (a) at any time that any Indebtedness (other than
contingent obligations not then due and payable) under the Opco Credit Agreement shall be
outstanding, any “Loan Party” under and as defined in the Opco Credit Agreement from time to time
and (b) at any time that any Indebtedness (other than contingent obligations not then due and
payable) under the Opco Credit Agreement shall cease to be outstanding, the Company and each of its
subsidiaries that most recently were “Loan Parties” under the Opco Credit Agreement as it existed
immediately prior to the termination thereof; provided that the Company may continue to
designate any such Opco Loan Party as an “Excluded Subsidiary” or an “Unrestricted Subsidiary” in
accordance with (and subject to) the provisions of this Agreement in which case it shall from and
after such time cease to be an Opco Loan Party.



     “Opco Restricted Subsidiary” shall mean any subsidiary of the Company that shall be
designated as a “Restricted Subsidiary” under (and in accordance with the provisions of) the Opco
Credit Agreement from time to time.



     “Opco Specified Hedging Agreement” shall mean a “Specified Hedging Agreement” under
and as defined in the Opco Credit Agreement.



     “Opco Subsidiary Guarantor” shall mean any Opco Loan Party other than the Company.



     “Opco Unrestricted Subsidiary” shall mean any subsidiary of the Company that shall be
designated as an “Unrestricted Subsidiary” under (and in accordance with the provisions of) the
Opco Credit Agreement from time to time.



     “Other Taxes” shall mean any and all present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies (including interest, fines, penalties
and additions to tax) arising from any payment made under any Loan Document or from the execution,
delivery or enforcement of, or otherwise with respect to, any Loan Document.



     “Parity Lien Debt” shall mean (a) the Existing Commodity Hedging Agreements; (b) any
other Indebtedness consisting of Commodity Hedging Obligations that is permitted to be incurred
under Section 6.01 and secured by a second priority Lien permitted under Section 6.02; and (c) any
secured Indebtedness that is permitted to be incurred under Section 6.01(p) and secured by a second
priority Lien



33









 







permitted under Section 6.02; provided, in the case of Indebtedness referred to in
clauses (b) and (c), that (i) such Indebtedness is governed by an agreement that includes a Sharing
Confirmation and (ii) all requirements set forth in the Collateral Trust Agreement as to the
confirmation, grant or perfection of the Liens granted to the Collateral Trustee, for the benefit
of the applicable secured parties, to secure such Indebtedness or obligations in respect thereof
are satisfied (and the satisfaction of such requirements and the other provisions of this clause
(ii) shall be conclusively established, for purposes of entitling the holders of such Indebtedness
to share Equally and Ratably with the other holders of Parity Lien Debt in the benefits and
proceeds of the Collateral Trustee’s Liens on the Collateral, if the Company delivers to the
Collateral Trustee an officers’ certificate stating that such requirements and other provisions
have been satisfied and that such Indebtedness is Parity Lien Debt and/or Second Lien Debt, as
applicable).



     “Parity Lien Obligations” shall mean Parity Lien Debt and all other obligations in
respect thereof.



     “PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.



     “Perfection Certificate” shall mean the Pre-Closing UCC Diligence Certificate in
respect of the Borrower substantially in the form of Exhibit H or any other form reasonably
approved by the Collateral Agent.



     “Permitted Acquisition” shall mean any acquisition, by merger or otherwise, by the
Borrower, the Company or any other Restricted Subsidiary of assets or Capital Stock after the
Closing Date, so long as, (a) such acquisition and all transactions related thereto shall be
consummated in accordance with all Applicable Laws; (b) such acquisition shall result in the issuer
of such Capital Stock becoming a Restricted Subsidiary that is not an Excluded Subsidiary; (c)
after giving effect to such acquisition, no Default or Event of Default shall have occurred and be
continuing; and (d) each of the Consolidated Leverage Ratio of the Borrower and the Consolidated
Interest Coverage Ratio of the Borrower for the Borrower’s most recently ended Test Period for
which financial statements are publicly available immediately preceding the date of such
acquisition would have been no more than 6.50 to 1.00 and no less than 1.50 to 1.00, respectively,
determined on a pro forma basis as if such acquisition (and any Indebtedness incurred in connection
therewith or from the end of such Test Period through the date on which such calculation is made)
had occurred on the first day of the applicable Test Period and was outstanding on such calculation
date.



     “Permitted Asset Swap” shall mean any transfer of Equity Interests or properties or
other assets (other than any such Equity Interests, properties or other assets constituting Core
Collateral) by the Borrower or any of the Restricted Subsidiaries in which at least 75% of the
consideration received by the transferor or any of its Affiliates (provided that such Affiliate
shall be (x) a Restricted Subsidiary and (y) if the applicable transferor is an Opco Loan Party, an
Opco Loan Party) consists of Equity Interests or properties or other assets (other than cash or
Cash Equivalents) useful in the Permitted Business; provided that the aggregate Fair Market
Value of the Equity Interests or property or other assets being transferred by the Borrower or such
Restricted Subsidiary is not greater than the aggregate Fair Market Value of the Equity Interests
or properties or other assets received by the Borrower or such Restricted Subsidiary in such
transfer.



     “Permitted Business” shall mean the business of holding, acquiring, constructing,
managing, developing, improving, maintaining, leasing, owning and operating Facilities, together
with any related assets or facilities, and any other business conducted by the Borrower and its
Restricted Subsidiaries on the Closing Date, as well as any other activities reasonably related,
ancillary, incidental or complementary to any of the foregoing activities (including acquiring and
holding reserves), including investing in Facilities.



34









 





     “Permitted Environmental Control Lease” shall mean a lease and leaseback or sale and
leaseback transaction undertaken in connection with the issuance of pollution or waste control
systems bonds the proceeds of which shall be used by the Borrower or a Restricted Subsidiary to
finance the purchase, construction and/or installation of emissions control equipment for the
assets so leased and leased-back (or sold and leased-back, as applicable) in which such assets are
leased or sold to any Governmental Authority issuing such bonds (or its designee) by the Borrower
or such Restricted Subsidiary and simultaneously leased-back to the Borrower or such Restricted
Subsidiary (as the case may be); provided that (a) any pre-existing Liens on such assets shall not
be extinguished as a result of such lease and leaseback (or sale and leaseback, as applicable)
transaction, (b) the Governmental Authority issuing such bonds (or its designee) shall take an
interest in the relevant property, subject to such pre-existing Liens, and (c) the terms and
conditions of such transaction and all related transactions shall be reasonably satisfactory to the
Administrative Agent.



     “Permitted Itiquira Indebtedness” shall have the meaning assigned to such term in the
definition of “Itiquira Refinancing”.



     “Permitted Liens” shall mean



     (a) Liens held by the applicable Collateral Trustee on assets of the Company or any other Opco
Loan Party securing (i) obligations of the Company or such other Opco Loan Party under the Opco
Credit Agreement or the other Opco Loan Documents or relating to obligations under any Opco
Specified Hedging Agreements and (ii) secured obligations of the Company or such other Opco Loan
Party relating to Revolver Refinancing Indebtedness permitted by Section 6.01(a);



     (b) second priority Liens on assets of the Company or any other Opco Loan Party held by the
applicable Collateral Trustee Equally and Ratably securing Parity Lien Debt and other Parity Lien
Obligations;



     (c) Liens on Equity Interests or assets of Excluded Subsidiaries securing Indebtedness and
other obligations of Excluded Subsidiaries that was permitted by the terms of this Agreement to be
incurred;



     (d) Liens (i) in favor of the Borrower, the Company or any of the other Opco Loan
Parties, (ii) incurred by Excluded Project Subsidiaries in favor of any other Excluded Project
Subsidiary and (iii) incurred by Excluded Foreign Subsidiaries in favor of any other Excluded
Foreign Subsidiary;



     (e) Liens to secure the performance of statutory obligations, surety or appeal bonds,
performance bonds or other obligations of a like nature incurred in the ordinary course of
business;



     (f) Liens to secure Indebtedness (including Capital Lease Obligations) permitted by Section
6.01(d) hereof covering only the assets acquired with or financed by such Indebtedness;



     (g) Liens existing on the Closing Date and set forth on Schedule 6.02;



     (h) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent
or that are being contested in good faith by appropriate proceedings promptly instituted and
diligently concluded; provided that any reserve or other provision as is required in
conformity with GAAP has been made therefor;



     (i) Liens imposed by law (other than those described in clause (h) above), such as carriers’,
warehousemen’s, landlords’ and mechanics’ Liens;



35









 





     (j) survey exceptions, easements or reservations of, or rights of others for, licenses,
rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or
zoning or other restrictions as to the use of real property that were not incurred in connection
with Indebtedness and that do not in the aggregate materially adversely affect the value of said
properties or materially impair their use in the operation of the business of such Person;



     (k) Liens to secure any Permitted Refinancing Indebtedness permitted to be incurred under this
Agreement; provided, however, that such Lien shall be limited to all or part of the
same property and assets that secured or, under the written agreements pursuant to which the
original Lien arose, could secure the original Lien (plus improvements and accessions to
such property or proceeds or distributions thereof);



     (l) Liens incurred or deposits made in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social security;



     (m) Liens encumbering deposits made to secure obligations arising from statutory, regulatory,
contractual or warranty requirements of the Borrower or any of its Restricted Subsidiaries,
including rights of offset and set-off;



     (n) leases or subleases granted to others that do not materially interfere with the ordinary
course of business of the Borrower and its Restricted Subsidiaries, taken as a whole;



     (o) inchoate statutory Liens arising under ERISA incurred in the ordinary course of business;



     (p) Liens existing on the assets of any Person that becomes a Restricted Subsidiary, or
existing on assets acquired, pursuant to a Permitted Acquisition to the extent the Liens on such
assets secure Indebtedness permitted by Section 6.01(q); provided that such Liens attach at
all times only to the same assets that such Liens attached to, and secure only the same
Indebtedness that such Liens secured, immediately prior to such Permitted Acquisition;



     (q)(i) Liens placed upon the Capital Stock of any Restricted Subsidiary of the Borrower
acquired pursuant to a Permitted Acquisition to secure Indebtedness of the Borrower or any other
Restricted Subsidiary incurred pursuant to Section 6.01(r) in connection with such Permitted
Acquisition and (ii) Liens placed upon the assets of such Restricted Subsidiary to secure a
guarantee by such Restricted Subsidiary of any such Indebtedness of the Borrower or any other
Restricted Subsidiary;



     (r) Liens on cash and Cash Equivalents (i) deposited by the Company or any of its Restricted
Subsidiaries in margin accounts with or on behalf of futures contract brokers or paid over to other
counterparties or (ii) pledged or deposited as collateral to a contract counterparty or issuer of
surety bonds or issuer of letters of credit by the Company or any of its Restricted Subsidiaries,
in each case to secure obligations with respect to (A) contracts for commercial and trading
activities in the ordinary course of business and contracts (including physical delivery, option
(whether cash or financial), exchange, swap and futures contracts) for the purchase, transmission,
transportation, distribution, sale, lease or hedge of any fuel-related or power-related commodity
or service or (B) Commodity Hedging Agreements;



     (s) Liens arising from UCC financing statements filed on a precautionary basis in respect of
operating leases intended by the parties to be true leases (other than any such leases entered into
in violation of this Agreement);



     (t) Liens on assets and Equity Interests of a subsidiary of the Company that is an Excluded
Subsidiary as of the Closing Date;



36









 





     (u) Liens granted in favor of Xcel Energy, Inc. pursuant to the Xcel Indemnification
Agreements as in effect on the Closing Date on the Collateral (as defined in the Xcel
Indemnification Agreements) held by Xcel thereunder;



     (v) first priority Liens held by the applicable Collateral Trustee (and subject to the terms
of the applicable Collateral Trust Agreement) to secure Indebtedness incurred pursuant to Section
6.01(p) that, together with (i) any additional loans or commitments incurred under Section 2.25 of
the Opco Credit Agreement (or any other similar Section of the Opco Credit Agreement in which
pre-approved and/or incremental commitments and loans which were not committed or made as of the
Closing Date are committed or made by lenders thereunder after the Closing Date) and (ii) any
Parity Lien Debt incurred under Section 6.01(p) and secured by a Lien permitted under clause (b) of
this definition, does not exceed at any one time outstanding the greater of (1) $720,000,000 and
(2) an amount equal to the Consolidated EBITDA of the Company for the period of four consecutive
fiscal quarters most recently ended on or prior to the date on which such Indebtedness is incurred
multiplied by 30%;



     (w) Liens on cash deposits and other funds maintained with a depositary institution, in each
case arising in the ordinary course of business by virtue of any statutory or common law provision
relating to banker’s liens, including Section 4-210 of the UCC;



     (x) any restrictions on any Equity Interest or Project Interest of a Person providing for a
breach, termination or default under any owners, participation, shared facility, joint venture,
stockholder, membership, limited liability company or partnership agreement between such Person and
one or more other holders of Equity Interests or Project Interests of such Person, if a security
interest or other Lien is created on such Equity Interest or Project Interest as a result thereof
and other similar Liens and restrictions described in Section 6.07(b)(ix) and 6.07(c)(I);



     (y) any Liens on Excluded Assets described in clause (xiii) of the definition thereof set
forth in the Opco Credit Agreement;



     (z) Liens to secure Environmental CapEx Debt or Necessary CapEx Debt permitted by Section
6.01(v) that encumber only the assets purchased, installed or otherwise acquired with the proceeds
of such Environmental CapEx Debt or Necessary CapEx Debt;



     (aa) Liens on assets or securities granted or deemed to arise in connection with and solely as
a result of the execution, delivery or performance of contracts to purchase or sell such assets or
securities if such purchase or sale is otherwise permitted hereunder;



     (bb) Liens on assets of the Company or any other Restricted Subsidiary with respect to
obligations (other than in respect of Indebtedness) that do not exceed $60,000,000 at any one time
outstanding;



     (cc) Liens on assets of the Borrower that do not exceed $60,000,000 at any one time
outstanding;



     (dd) Liens and options to acquire the “Switchyard Area” of the Webster Plant owned by NRG
Texas LLC;



     (ee) Liens in favor of any Securitization Vehicle or its assignee or agent (including any
lenders to such Securitization Vehicle) on South Central Securitization Assets transferred or
purported to be transferred to such Securitization Vehicle in connection with a South Central
Securitization permitted by Section 6.04;



37









 





     (ff) those Liens or other exceptions to title, in either case on or in respect of any facility
of the Borrower or any Subsidiary, arising as a result of any shared facility agreement entered
into with respect to such facility, except to the extent that any such Liens or exceptions,
individually or in the aggregate, materially adversely affect the value of the relevant property or
materially impair the use of the relevant property in the operation of the business of the Borrower
or such Subsidiary;



     (gg) Liens securing Eligible Commodity Hedging Agreements that are pari passu with the Liens
securing the Priority Lien Obligations (as defined in the NRG Collateral Trust Agreement) under the
Opco Loan Documents so long as (x) any counterparty thereto joins the Collateral Trust Agreements
pursuant to the terms thereof or in a manner reasonably satisfactory to the Administrative Agent
and (y) such Lien is granted in compliance with the terms and provisions of the Collateral Trust
Agreements, including Section 3.8(c) of the NRG Collateral Trust Agreement; and



     (hh) Liens created pursuant to the Security Documents.



     “Permitted Refinancing Indebtedness” shall mean any Indebtedness of the Borrower or
any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to
refund, refinance, replace, defease or discharge, other Indebtedness of the Borrower or any of its
Restricted Subsidiaries (other than intercompany Indebtedness); provided that (a) the
principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does
not exceed the principal amount (or accreted value, if applicable) of the Indebtedness extended,
refinanced, renewed, replaced, defeased or refunded (plus all accrued and unpaid interest
on such Indebtedness and the amount of all expenses and premiums incurred in connection therewith);
(b) such Permitted Refinancing Indebtedness has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded (provided that amortization payments of up to 1%
per annum shall be excluded for purposes of calculating the Weighted Average Life to Maturity of
any such Permitted Refinancing Indebtedness); (c) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of payment to the obligations
hereunder, such Permitted Refinancing Indebtedness is subordinated in right of payment to the
obligations hereunder on terms at least as favorable to the Lenders as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; (d) such Indebtedness is incurred either by the Borrower (and may be guaranteed by any
subsidiary of the Borrower to the extent permitted by Section 6.01(i)) or by the Restricted
Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (e)(i) if the Stated Maturity of the Indebtedness being refinanced is
earlier than the Term Loan Maturity Date, the Permitted Refinancing Indebtedness has a Stated
Maturity no earlier than the Stated Maturity of the Indebtedness being refinanced or (ii) if the
Stated Maturity of the Indebtedness being refinanced is later than the Term Loan Maturity Date, the
Permitted Refinancing Indebtedness has a Stated Maturity at least 91 days later than the Term Loan
Maturity Date.



     “Permitted Tax Lease” shall mean a lease and leaseback or sale and leaseback
transaction undertaken by the Borrower or a Restricted Subsidiary in connection with a PILOT
Agreement, which will yield tax savings to the Borrower or such Restricted Subsidiary during the
term of the Term Loans; provided that (a) no Indebtedness for borrowed money shall be incurred in
connection with such transaction, (b) any pre-existing Liens on the property subject to the
transaction shall not be extinguished as a result of such lease and leaseback (or sale and
leaseback, as applicable) transaction, (c) the Governmental Authority party to such lease and
leaseback or sale and leaseback transactions (or its designee) shall take an interest in the
relevant property subject to such pre-existing Liens, and (d) the terms and conditions of such
transaction and all related transactions shall be reasonably satisfactory to the Administrative
Agent.



38









 





     “Person” shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited liability company or
government or other entity.



     “PILOT Agreement” shall mean a payment-in-lieu of tax agreement entered into between
the Borrower or a Restricted Subsidiary and a Governmental Authority.



     “Pledged Securities” shall have the meaning assigned to such term in the Collateral
Agreement.



     “Preferred Stock” shall mean (i) the 4% Convertible Perpetual Preferred Stock, par
value $0.01 per share, of the Company (or, following the Holdings Reorganization, the Borrower),
(ii) the 3.625% Convertible Perpetual Preferred Stock, par value $0.01 per share, of the Company
(or, following the Holdings Reorganization, the Borrower) and (iii) the Mandatory Convertible
Preferred Stock, in each case issued on or prior to the Closing Date.



     “Prime Rate” shall mean the rate of interest per annum publicly announced from time to
time by The Wall Street Journal as the “base rate on corporate loans posted by at least 75% of the
nation’s 30 largest banks” (or, if The Wall Street Journal ceases quoting a base rate of the type
described, the highest per annum rate of interest published by the Federal Reserve Board in Federal
Reserve statistical release H.15 (519) entitled “Selected Interest Rates” as the Bank prime loan
rate or its equivalent); each change in the Prime Rate shall be effective as of the opening of
business on the date such change is publicly announced as being effective. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate actually available.



     “Project Interest” shall mean any undivided interest in a Facility.



     “Pro Rata ECF Percentage” shall mean the percentage that the outstanding principal
amount of Term Loans constitutes of the aggregate outstanding principal amount of Term Loans and
outstanding Term Loans (under and as defined in the Opco Credit Agreement).



     “Prudent Industry Practice” shall mean those practices and methods as are commonly
used or adopted by Persons in the Permitted Business in the United States in connection with the
conduct of the business of such industry, in each case as such practices or methods may evolve from
time to time, consistent with all Requirements of Law.



     “PUCT” shall mean the Public Utility Commission of Texas.



     “PUHCA” shall mean the Public Utility Holding Company Act of 2005 and the rules and
regulations promulgated thereunder, effective February 8, 2006.



     “PURPA” shall mean the Public Utility Regulatory Policies Act of 1978 and the rules
and regulations promulgated thereunder, as amended from time to time.



     “QF” shall mean a “qualifying facility” under PURPA.



     “Qualified Counterparty” shall mean, (a) with regard to any Specified Hedging
Agreement in existence on the Closing Date, any counterparty thereto that, as of the Closing Date,
was a Lender, an Agent, CGMI, an Arranger or the Syndication Agent or an Affiliate of a Lender, an
Agent, CGMI, an Arranger or the Syndication Agent and (b) with respect to any Specified Hedging
Agreement entered into on or after the Closing Date, any counterparty thereto that, at the time
such Specified Hedging Agreement



39









 







was entered into, was a Lender, an Agent, CGMI, an Arranger or the Syndication Agent or an
Affiliate of a Lender, an Agent, CGMI, an Arranger or the Syndication Agent.



     “Rate” shall have the meaning set forth in the definition of Type.



     “Recovery Event” shall mean the receipt of cash proceeds by the Borrower or any
Restricted Subsidiary with respect to any settlement of or payment in respect of (a) any property
or casualty insurance claim or (b) any taking under power of eminent domain or by condemnation or
similar proceeding of or relating to any property or asset of the Borrower or any Restricted
Subsidiary.



     “Reference Date” shall have the meaning set forth in the definition of Available
Amount.



     “Register” shall have the meaning assigned to such term in Section 9.04(d).



     “Regulation T” shall mean Regulation T of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof.



     “Regulation U” shall mean Regulation U of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof.



     “Regulation X” shall mean Regulation X of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof.



     “Reinvestment Period” shall have the meaning assigned to such term in the definition
of “Net Cash Proceeds”.



     “Related Fund” shall mean, with respect to any Lender that is a fund that invests in
bank loans, any other fund that invests in bank loans and is advised or managed by such Lender, an
Affiliate of such Lender, the same investment advisor as such Lender or by an Affiliate of such
investment advisor.



     “Related Parties” shall mean, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, trustees, employees, agents and advisors of such
Person and such Person’s Affiliates.



     “Release” shall mean any release, spill, emission, leaking, pumping, injection,
pouring, emptying, deposit, disposal, discharge, dispersal, dumping, escaping, leaching or
migration into or through the environment or within or upon any building, structure, facility or
fixture.



     “Repayment Date” shall have the meaning assigned to such term in Section 2.11(a).



     “Requested Prepayment Amount” shall have the meaning assigned to such term in Section
2.13(e).



     “Required Lenders” shall mean, at any time, Lenders having Term Loans and unused Term
Loan Commitments representing at least a majority of the sum of all Term Loans outstanding and
unused Term Loan Commitments at such time.



     “Required Prepayment Percentage” shall mean (a) in the case of any Holdings Asset Sale
or Holdings Recovery Event, 100%; (b) in the case of any issuance or other incurrence of
Indebtedness (except for Indebtedness permitted to be issued or incurred pursuant to Section 6.01),
100%; and (c) in the case of any Excess Cash Flow, 75% or, if on the date of the applicable
prepayment, the Consolidated




40









 




Leverage Ratio of the Borrower is less than or equal to 4.25 to 1.00 but greater
than 3.00 to 1.00, 50%, or, if on the date of the applicable prepayment, the Consolidated Leverage
Ratio of the Borrower is less than or equal to 3.00 to 1.00 but greater than 2.50 to 1.00, 25%, or,
if on the date of the applicable prepayment, the Consolidated Leverage Ratio of the Borrower is
less than or equal to 2.50 to 1.00, 0%.




     “Restricted Subsidiary” of a specified Person shall mean, with respect to such Person,
any subsidiary of that Person that is not an Unrestricted Subsidiary from time to time. Unless
otherwise indicated, any reference to a “Restricted Subsidiary” shall be deemed to be a reference
to a Restricted Subsidiary of the Borrower. Notwithstanding anything in this Agreement to the
contrary, (a) after the Holdings Reorganization, the Company shall be a Restricted Subsidiary of
the Borrower at all times and (b) the Company and all of the Opco Restricted Subsidiaries shall be
(or, prior to the Holdings Reorganization, shall be deemed to be) Restricted Subsidiaries of the
Borrower at any time that any Indebtedness (other than contingent obligations not then due and
payable) under the Opco Credit Agreement shall be outstanding.



     “Retained Prepayment Amount” shall mean, on any date, an amount equal at such time to
(a) the sum of (1) on and after the Company shall have provided its calculation of the Excess Cash
Flow for the fiscal year ending December 31, 2006 pursuant to Section 5.04(c) of the Opco Credit
Agreement, an amount equal to such Excess Cash Flow for such fiscal year multiplied by 75%
and (2) without duplication of the amount described in clause (1), all amounts that are offered to
the Term Lenders and/or the Opco Lenders and retained by the Borrower and/or Company after all
mandatory prepayments, returns, reductions and cash collateralizations are made pursuant to
Sections 2.13(d), 2.13(e) and 2.13(f) of the Opco Credit Agreement or Sections 2.13(d) and 2.13(e)
of this Agreement after the “Closing Date” (as defined in the Opco Credit Agreement as of the date
hereof) and on or prior to such date (other than any amounts that are offered to the Term Lenders
and/or the Opco Lenders and retained by the Borrower and/or Company in connection with any required
prepayment offer made under Section 2.13(d) of the Opco Credit Agreement or Section 2.13(d) of this
Agreement with respect to any fiscal period that does not end on the last day of any fiscal year)
minus (b) the sum of (i) the aggregate amount of any Investments made by the Borrower or
any Restricted Subsidiary pursuant to Section 6.05(h) after the Closing Date and on or prior to
such date, (ii) the aggregate amount of any Dividends made by the Borrower or any Restricted
Subsidiary pursuant to Section 6.06(d)(iii) after the Closing Date and on or prior to such date and
(iii) the aggregate amount of any prepayments, repurchases and redemptions made by the Borrower or
any Restricted Subsidiary pursuant to Section 6.07(a)(vi) after the Closing Date and on or prior
such date.



     “Revolver Refinancing Indebtedness” shall mean Indebtedness issued or incurred under a
new revolving credit facility (a “New Revolver”) that refinances, refunds, extends, renews
or replaces Revolving Credit Commitments under and as defined in the Opco Credit Agreement;
provided that (a) the available commitments under such New Revolver shall not exceed
$1,200,000,000, (b) the Company shall be the only borrower under such New Revolver and the Opco
Subsidiary Guarantors shall be the only guarantors, if any, with respect thereto, (c) unless such
New Revolver shall be incurred within six months of the Revolving Credit Maturity Date under and as
defined in the Opco Credit Agreement, such New Revolver contains covenants and events of default
which, taken as a whole, are determined in good faith by a Financial Officer of the Company to be
the same in all material respects as (or less restrictive than) the covenants and events of default
contained in the Opco Credit Agreement and (d) the Indebtedness under such New Revolver, if
secured, is secured only by Liens on the Opco Collateral granted in favor of the Collateral Trustee
that are subject to the terms of the Collateral Trust Agreement.



     “Sale of Core Collateral” shall mean any Asset Sale involving a sale or other
disposition of Core Collateral.



41









 





     “S&P” shall mean Standard & Poor’s Ratings Group, Inc. or any successor entity.



     “Second Lien Debt” shall have the meaning assigned to such term in the Texas Genco
Collateral Trust Agreement.



     “Secured Parties” shall mean the Administrative Agent, the Collateral Agent, the
Syndication Agent, the Lenders and, with respect to any Specified Hedging Agreement, any Qualified
Counterparty that has agreed to be bound by the provisions of Article VIII hereof and Section 7.2
of the Collateral Agreement as if it were a party hereto or thereto; provided that no
Qualified Counterparty shall have any rights in connection with the management or release of any
Collateral or the obligations of the Borrower under the Collateral Agreement.



     “Securities Account” shall have the meaning assigned to such term in the UCC.



     “Securitization Vehicle” shall mean a Person that is a direct wholly owned Subsidiary
of the Company or of any other Restricted Subsidiary (a) formed for the purpose of effecting a
South Central Securitization, (b) to which the Company and/or any other Restricted Subsidiary
transfers South Central Securitization Assets and (c) which, in connection therewith, issues Third
Party Securities; provided that (i) such Securitization Vehicle shall engage in no business other
than the purchase of South Central Securitization Assets pursuant to the South Central
Securitization permitted by Section 6.04, the issuance of Third Party Securities or other funding
of such South Central Securitization and any activities reasonably related thereto and (ii) such
Securitization Vehicle shall be an Unrestricted Subsidiary under this Agreement and an
“Unrestricted Subsidiary” under each of the Opco Credit Agreement and each Senior Note Document.



     “Security Documents” shall mean the Collateral Agreement, the Mortgages, the Control
Agreements, the Intellectual Property Security Agreements, and each of the other security
agreements, pledges, mortgages, assignments (collateral or otherwise), consents and other
instruments and documents executed and delivered pursuant to any of the foregoing or pursuant to
Section 5.09 or 5.10.



     “Sellers’ Retained Interests” means the debt and/or equity interests (including any
intercompany notes) held by the Company or any other Restricted Subsidiary in a Securitization
Vehicle to which South Central Securitization Assets have been transferred in a South Central
Securitization permitted by Section 6.04, including any such debt or equity received as
consideration for, or as a portion of, the purchase price for the South Central Securitization
Assets transferred, and any other instrument through which the Company or any Restricted Subsidiary
has rights to or receives distributions in respect of any residual or excess interest in the South
Central Securitization Assets.



     “Senior Debt” shall mean, with respect to any specified Person, all Total Debt of such
Person that is not subordinated in right of payment to the obligations under this Agreement or
under the Opco Credit Agreement.



     “Senior Note Documents” shall mean the indenture under which the Senior Notes are
issued and all other instruments, agreements and other documents evidencing or governing the Senior
Notes or providing for any Guarantee or other right in respect thereof, in each case as the same
may be amended or supplemented from time to time in accordance with the terms hereof and thereof.



     “Senior Notes” shall mean each of (i) the Company’s 7.375% Senior Notes due 2016 (ii)
the Company’s 7.250% Senior Notes due 2014 and (iii) the Company’s 7.375% Senior Notes due 2017, in
each case including any notes issued by the Company in full exchange for, and as contemplated by,
such



42









 







Senior Notes with substantially identical terms as such Senior Notes in an aggregate amount
not to exceed $4,700,000,000.



     “Sharing Confirmation” shall mean, as applicable, (i) a “Sharing Confirmation” as
defined in the NRG Collateral Trust Agreement and/or (ii) a “Lien Sharing and Priority
Confirmation” as defined in the Texas Genco Collateral Trust Agreement.



     “Significant Subsidiary” shall mean any Subsidiary that would be a “significant
subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the
Securities Act, as such Regulation is in effect on the Closing Date and shall in any event include
the Core Collateral Subsidiaries.



     “South Central Securitization” shall mean any transaction or series of transactions
entered into by the Company or any other Restricted Subsidiary pursuant to which the Company or
such Restricted Subsidiary, as the case may be, sells, conveys, assigns, grants an interest in or
otherwise transfers, from time to time, to one or more Securitization Vehicles the South Central
Securitization Assets (and/or grants a security interest in such South Central Securitization
Assets transferred or purported to be transferred to such Securitization Vehicle), and which
Securitization Vehicle finances the acquisition of such South Central Securitization Assets (i)
with proceeds from the issuance of Third Party Securities, (ii) with the issuance to the Company or
such Restricted Subsidiary of Sellers’ Retained Interests or an increase in such Seller’s Retained
Interests or (iii) with proceeds from the sale or collection of South Central Securitization
Assets.



     “South Central Securitization Assets” shall mean any accounts receivable originated or
expected to be originated by (and owed to) the Company or any other Restricted Subsidiary (in each
case whether now existing or arising or acquired in the future) arising from the installation of
pollution control equipment for the removal or reduction of mercury, SO2,
NOx  and/or other pollutants in the Company’s Big Cajun facilities in
Louisiana and any ancillary assets (including contract rights) which are of the type customarily
conveyed with, or in respect of which security interests are customarily granted in connection
with, such accounts receivable in a securitization transaction and which are sold, transferred or
otherwise conveyed by the Company or any other Restricted Subsidiary to a Securitization
Vehicle. 



     “SPC” shall have the meaning assigned to such term in Section 9.04(i).



     “Specified Facility” means each of the following Facilities, or any part thereof: (a)
the Facilities held on the “Closing Date” (as defined in the Opco Credit Agreement as of the date
hereof) by Vienna Power LLC, Meriden Gas Turbine LLC, Norwalk Power LLC, Connecticut Jet Power LLC
(excluding the assets located at the Cos Cob site), Devon Power LLC, Montville Power LLC (including
the Capital Stock of the entities owning such Facilities provided that such entities do not hold
material assets other than the Facilities held on the “Closing Date” (as defined in the Opco Credit
Agreement as of the date hereof)); (b) the following Facilities, or any part thereof: P.H.
Robinson, H.O. Clarke, Webster, Unit 3 at Cedar Bayou, Unit 2 at T.H. Wharton; and (c) the Capital
Stock of the following subsidiaries of the Company if such subsidiary holds no assets other than
the Capital Stock of a Foreign Subsidiary of the Company: NRG Latin America, Inc., NRG
International LLC, NRG Insurance Ltd. (Cayman Islands), NRG Asia Pacific, Ltd., NRG International
II Inc. and NRG International III Inc.



     “Specified Hedging Agreement” shall mean any Interest Rate/Currency Hedging Agreement
of the type described in clause (a) or (b) of the definition thereof entered into by the Borrower
and any Qualified Counterparty.



43









 





     “Sponsor Preferred Stock” shall mean the shares of the Company’s (or, following the
Holdings Reorganization, the Borrower’s) preferred stock issued pursuant to the terms of the
Purchase Agreement (as defined in the Opco Credit Agreement on the date hereof).



     “Stated Maturity” shall mean, with respect to any installment of interest or principal
on any series of Indebtedness, the date on which the payment of interest or principal was scheduled
to be paid in the documentation governing such Indebtedness as of the Closing Date, and will not
include any contingent obligations to repay, redeem or repurchase any such interest or principal
prior to the date originally scheduled for the payment thereof.



     “Statutory Reserves” shall mean a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus the aggregate
of the maximum reserve percentages (including any marginal, special, emergency or supplemental
reserves) expressed as a decimal established by the Board and any other banking authority, domestic
or foreign, to which the Administrative Agent or any Lender (including any branch, Affiliate or
other fronting office making or holding a Term Loan) is subject for eurocurrency funding (currently
referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Eurodollar Term Loans
shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be available from time
to time to any Lender under such Regulation D or any comparable regulation. Statutory Reserves
shall be adjusted automatically on and as of the effective date of any change in any reserve
percentage.



     “subsidiary” shall mean, with respect to any Person (herein referred to as the
“parent”), any corporation, partnership, limited liability company, association or other
entity of which securities or other ownership interests representing more than 50% of the equity or
more than 50% of the ordinary voting power or more than 50% of the general partnership interests
are, at the time any determination is being made, owned, controlled or held by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.



     “Subsidiary” shall mean any subsidiary (direct or indirect) of the Borrower.



     “Syndication Agent” shall have the meaning assigned to such term in the preamble.



     “Synthetic Lease Obligations” shall mean all monetary obligations of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease or (b) an agreement for the use
or possession of any property (whether real, personal or mixed) creating obligations which do not
appear on the balance sheet of such Person, but which, upon the insolvency or bankruptcy of such
Person, would be characterized as Indebtedness of such Person (without regard to accounting
treatment).



     “Tax Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.



     “Taxes” shall mean any and all present or future taxes, levies, imposts, duties,
deductions, charges, liabilities or withholdings (including interest, fines, penalties or additions
to tax) imposed by any Governmental Authority.



     “Term Borrowing” shall mean a Borrowing comprised of Term Loans.



     “Term Lender” shall mean a Lender with a Term Loan Commitment or an outstanding Term
Loan.



44









 





     “Term Loan Commitment” shall mean, with respect to each Lender, the commitment, if
any, of such Lender to make Term Loans hereunder as set forth on the Lender Addendum delivered by
such Lender, or in the Assignment and Acceptance pursuant to which such Lender assumed its Term
Loan Commitment, as applicable, as the same may be (a) reduced from time to time pursuant to
Section 2.09 and (b) reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial aggregate amount of all Term Loan Commitments on the
Closing Date is $1,000,000,000.



     “Term Loan Commitment Termination Date” shall mean December 28, 2007.



     “Term Loan Maturity Date” shall mean the seventh anniversary of the Funding Date.



     “Term Loans” shall mean the term loans made by the Lenders to the Borrower pursuant to
Section 2.01(a).



     “Test Period” shall mean, for any determination under this Agreement, the four
consecutive fiscal quarters of the Borrower or the Company, as applicable, then last ended.



     “Texas Genco Collateral Trust Agreement” shall mean the Collateral Trust Agreement
dated as of the Closing Date (as defined in the Opco Credit Agreement), as the same may be amended,
restated, supplemented, replaced or otherwise modified from time to time in accordance with the
terms thereof.



     “Texas Genco Collateral Trustee” shall mean Wachovia Bank, National Association,
acting as collateral trustee under the Texas Genco Collateral Trust Agreement, or its successors
appointed in accordance with the terms thereof.



     “Third Party Securities” shall mean, with respect to any South Central Securitization,
notes, bonds or other debt instruments, beneficial interests in a trust, undivided ownership
interests in receivables or other securities issued for cash consideration by the relevant
Securitization Vehicle to banks, financing conduits, investors or other financing sources (other
than the Company or any subsidiary of the Company except in respect of the Seller’s Retained
Interest) the proceeds of which are used to finance, in whole or in part, the purchase by such
Securitization Vehicle of South Central Securitization Assets in a South Central Securitization.
The amount of any Third Party Securities shall be deemed to equal the aggregate principal, stated
or invested amount of such Third Party Securities which are outstanding at such time.



     “Total Debt” shall mean, with respect to any specified Person at any time, the
aggregate amount of Indebtedness of such Person and its Restricted Subsidiaries outstanding at such
time, in the amount that would be reflected on a balance sheet prepared at such time on a
consolidated basis in accordance with GAAP; provided, however, that (i) Total Debt
will exclude all Indebtedness of Excluded Subsidiaries (but, for the avoidance of doubt, not
Guarantees of such Indebtedness by the Borrower, the Company or the other Opco Loan Parties), (ii)
with respect to Hedging Obligations of the Borrower or any Restricted Subsidiary, Total Debt will
include only the amount of payments that any such Person is required to make, on the date Total
Debt is being determined, as a result of an early termination or similar event in respect of
outstanding Hedging Obligations of such Person and (iii) for the avoidance of doubt, the undrawn
amount of all outstanding letters of credit (including Funded Letters of Credit and Revolving
Letters of Credit (each as defined in the Opco Credit Agreement)) shall not be included in Total
Debt.



     “Transactions” shall mean, collectively, (a) the execution, delivery and performance
by the Borrower of the Loan Documents, (b) the borrowings hereunder and the use of proceeds of each
of the foregoing, (c) the granting of Liens pursuant to the Security Documents, (d) the Holdings
Reorganization



45









 







and the Holdings Contribution and (e) any other transactions related to or entered into in
connection with any of the foregoing.



     “Type”, when used in respect of any Term Loan or Term Borrowing, shall refer to the
Rate by reference to which interest on such Term Loan or on the Term Loans comprising such Term
Borrowing is determined. For purposes hereof, the term “Rate” shall include the Adjusted
LIBO Rate and the Alternate Base Rate.



     “UCC” shall mean the Uniform Commercial Code as in effect in the State of New York or
any other applicable jurisdiction.



     “Uniform Customs” shall have the meaning assigned to such term in Section 9.07.



     “Unrestricted Subsidiary” shall mean any subsidiary of the Borrower (other than any
subsidiary of the Company that constitutes or owns Core Collateral) that is designated by the Board
of Directors (or any committee thereof) of the Borrower as an Unrestricted Subsidiary pursuant to a
board or committee resolution, but only to the extent that such subsidiary (a) has no Indebtedness
other than Non-Recourse Indebtedness (it being understood that for purposes of this definition,
Indebtedness permitted under Section 6.01(x) shall not disqualify Indebtedness of a Securitization
Vehicle from being “Non-Recourse Indebtedness”); (b) except as permitted by Section 6.08 hereof, is
not party to any agreement, contract, arrangement or understanding with the Borrower or any
Restricted Subsidiary unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to the Borrower or such Restricted Subsidiary than those that
might be obtained at the time from Persons who are not Affiliates of the Borrower; (c) is a Person
with respect to which neither the Borrower nor any of the Restricted Subsidiaries has any direct or
indirect obligation to maintain or preserve such Person’s financial condition or to cause such
Person to achieve any specified levels of operating results except as otherwise permitted by this
Agreement; and (d) has not guaranteed or otherwise directly or indirectly provided credit support
for any Indebtedness of the Borrower or any of the Restricted Subsidiaries except as otherwise
permitted by this Agreement. Any designation of a subsidiary of the Borrower as an Unrestricted
Subsidiary will be evidenced to the Administrative Agent by filing with the Administrative Agent a
certified copy of the board or committee resolution giving effect to such designation and an
officers’ certificate certifying that such designation complied with the conditions set forth in
Section 6.11 and was permitted by Section 6.05. If, at any time, any Unrestricted Subsidiary fails
to meet the requirements as an Unrestricted Subsidiary, it will thereafter cease to be an
Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such subsidiary of
the Borrower will be deemed to be incurred by an Restricted Subsidiary as of such date and, if such
Indebtedness is not permitted to be incurred as of such date by Section 6.01, the Borrower will be
in default of such covenant. The Board of Directors (or any committee thereof) of the Borrower may
at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary
of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation will only be
permitted if (A) such Indebtedness is permitted by Section 6.01, calculated on a pro forma basis as
if such designation had occurred at the beginning of the four-quarter reference period; and (B) no
Default or Event of Default would be in existence following such designation. Notwithstanding
anything in this Agreement to the contrary, (x) the Company may not be an Unrestricted Subsidiary
of the Borrower and (y) all of the Opco Unrestricted Subsidiaries from time to time shall be (or
shall be deemed to be) Unrestricted Subsidiaries of the Borrower at any time that any Indebtedness
(other than contingent obligations not then due and payable) under the Opco Credit Agreement shall
be outstanding.



     “Voting Stock” of any Person as of any date shall mean the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of Directors of such
Person.



46









 





     “Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness at
any date, the number of years obtained by dividing (a) the sum of the products obtained by
multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or
other required payments of principal, including payment at final maturity, in respect of the
Indebtedness, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment; by (b) the then outstanding principal amount of
such Indebtedness.



     “wholly owned subsidiary” of any specified Person shall mean a subsidiary of such
Person of which securities (except for directors’ qualifying shares or securities held by foreign
nationals as required by applicable law) or other ownership interests representing 100% of the
Equity Interests are, at the time any determination is being made, owned, controlled or held by
such Person or one or more wholly owned subsidiaries of such Person or by such Person and one or
more wholly owned subsidiaries of such Person; a “wholly owned Subsidiary” shall mean any
wholly owned subsidiary of the Borrower.



     “Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of
Subtitle E of Title IV of ERISA.



     “Xcel Indemnification Agreements” shall mean the Indemnification Agreements each dated
as of December 5, 2003, by and among Xcel Energy Inc., Northern States Power Company and the
Company, which was approved by the U.S. Bankruptcy Court for the Southern District of New York on
November 24, 2003, each as amended on November 8, 2006.



     SECTION 1.02. Terms Generally. The definitions in Section 1.01 shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words “include”,
“includes” and “including”, and words of similar import, shall not be limiting and shall be deemed
to be followed by the phrase “without limitation”. The word “will” shall be construed to have the
same meaning and effect as the word “shall”. The words “asset” and “property” shall be construed
as having the same meaning and effect and to refer to any and all rights and interests in tangible
and intangible assets and properties of any kind whatsoever, whether real, personal or mixed,
including cash, securities, Equity Interests, accounts and contract rights. The word “control”,
when used in connection with the Collateral Agent’s rights with respect to, or security interest
in, any Collateral, shall have the meaning specified in the UCC with respect to that type of
Collateral. The words “herein”, “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular provision of this
Agreement unless the context shall otherwise require. All references herein to Articles, Sections,
Exhibits and Schedules shall be deemed references to Articles and Sections of, and Exhibits and
Schedules to, this Agreement unless the context shall otherwise require. Except as otherwise
expressly provided herein, (a) any definition of, or reference to, any Loan Document or any other
agreement, instrument or document in this Agreement shall mean such Loan Document or other
agreement, instrument or document as amended, restated, supplemented or otherwise modified from
time to time (subject to any restrictions on such amendments, restatements, supplements or
modifications set forth herein) and (b) all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided,
however, that if the Borrower notifies the Administrative Agent that the Borrower wishes to
amend any covenant in Article VI or any related definition to eliminate the effect of any change in
GAAP occurring after the Closing Date on the operation of such covenant (or if the Administrative
Agent notifies the Borrower that the Required Lenders wish to amend Article VI or any related
definition for such purpose), then the Borrower’s compliance with such covenant shall be determined
on the basis of GAAP in effect immediately before the relevant change in GAAP became effective,
until either such
notice is withdrawn or such covenant is amended in a manner satisfactory to the Borrower and
the Required Lenders.



47









 





     SECTION 1.03. Classification of Term Loans and Borrowings. For purposes of this Agreement, Term
Loans may be classified and referred to by Type (e.g., a “Eurodollar Term Loan”). Borrowings also
may be classified and referred to by Type (e.g., a “Eurodollar Borrowing”).



     SECTION 1.04. Pro Forma Calculations. All pro forma calculations permitted or required to be made
by the Borrower, the Company or any of their Subsidiaries pursuant to this Agreement shall (a)
include only (i) those adjustments that would be permitted or required by Regulation S-X under the
Securities Act of 1933, as amended, or (ii) reductions in costs and related adjustments that have
been actually realized or are projected by the Borrower’s Chief Financial Officer in good faith to
result from reasonably identifiable and factually supportable actions or events, but only if such
reductions in costs and related adjustments are so projected by the Borrower to be realized during
the consecutive four-quarter period commencing after the transaction giving rise to such
calculation and (b) be certified to by a Financial Officer of the Borrower as having been prepared
in good faith based upon assumptions believed by the Borrower to be reasonable at the time made in
light of circumstances at the time made.



     SECTION 1.04. Exchange Rates. For purposes of determining compliance under Article VI with respect
to any amount in a foreign currency, the U.S. dollar-equivalent amount thereof will be calculated
based on the relevant currency exchange rate in effect at the time of such incurrence. The maximum
amount of Indebtedness, Liens, Investments and other basket amounts that the Borrower, the Company
and their Subsidiaries may incur under Article VI shall not be deemed to be exceeded, with respect
to any outstanding Indebtedness, Liens, Investments and other basket amounts, solely as a result of
fluctuations in the exchange rate of currencies, if as of the initial date of calculation the
Borrower determined that each such maximum amount had not been exceeded. When calculating capacity
for the incurrence of additional Indebtedness, Liens, Investments and other basket amounts by the
Borrower, the Company and their Subsidiaries under Article VI the exchange rate of currencies shall
be measured as of the date of calculation.



ARTICLE II.




The Credits




     SECTION 2.01. Commitments. Subject to the terms and conditions hereof and relying upon the
representations and warranties set forth herein, each Term Lender agrees, severally and not
jointly, to fund a Term Loan to the Borrower on the Funding Date in a principal amount equal to its
Term Loan Commitment (or such lower amount requested by the Borrower in accordance with Section
2.03 below); provided that, there shall only be a single Funding Date and such Funding Date
shall be required to occur on or prior to the Term Loan Commitment Termination Date. Amounts paid
or prepaid in respect of Term Loans may not be reborrowed.



     SECTION 2.01. Term Loans. (a) Each Term Loan shall be made as part of a Borrowing consisting of Term Loans of
the same Type made by the Lenders ratably in accordance with their respective Term Loan
Commitments; provided, however, that the failure of any Lender to make any Term
Loan required to be made by it shall not in itself relieve any other Lender of its obligation to
lend hereunder (it being understood, however, that no Lender shall be responsible for the failure
of any other Lender to make any Term Loan required to be made by such other Lender).



     (b) Subject to Sections 2.08 and 2.15, each Borrowing shall be comprised entirely of ABR Term
Loans or Eurodollar Term Loans as the Borrower may request pursuant to Section 2.03. Each Lender
may at its option make any Eurodollar Term Loan by causing any domestic or foreign branch or
Affiliate of such Lender to make such Term Loan; provided that any exercise of such option
shall (i) not affect the obligation of the Borrower to repay such Term Loan in accordance with the
terms of this



48









 




Agreement, (ii) not result in increased costs for the Borrower pursuant to Sections
2.14, 2.15, 2.16 or 2.20 and (iii) take into account the obligations of each Lender to mitigate
increased costs pursuant to Section 2.21 hereof. Borrowings of more than one Type may be
outstanding at the same time; provided, however, that the Borrower shall not be
entitled to request any Borrowing that, if made, would result in more than 5 Eurodollar Borrowings
outstanding hereunder at any time. For purposes of the foregoing, Borrowings having different
Interest Periods, regardless of whether they commence on the same date, shall be considered
separate Borrowings.




     (c) Each Lender shall make each Term Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds to such account in New York City as the
Administrative Agent may designate not later than 11:00 a.m., New York City time, and the
Administrative Agent shall promptly credit the amounts so received to an account designated by the
Borrower in the applicable Borrowing Request or, if a Borrowing shall not occur on such date
because any condition precedent herein specified shall not have been met, return the amounts so
received to the respective Lenders.



     (d) Unless the Administrative Agent shall have received notice from a Lender prior to the date
of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s
portion of such Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in accordance with
paragraph (c) of this Section and the Administrative Agent may, in reliance upon such assumption,
make available to the Borrower on such date a corresponding amount. If the Administrative Agent
shall have so made funds available then, to the extent that such Lender shall not have made such
portion available to the Administrative Agent, such Lender and the Borrower severally agree to
repay to the Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to the Borrower to but
excluding the date such amount is repaid to the Administrative Agent at (i) in the case of the
Borrower, the interest rate applicable at the time to the Term Loans comprising such Borrowing (in
lieu of interest which would otherwise become due to such Lender pursuant to Section 2.06) or (ii)
in the case of such Lender, a rate determined by the Administrative Agent to represent its cost of
overnight or short-term funds (which determination shall be conclusive absent clearly demonstrable
error). If such Lender shall repay to the Administrative Agent such corresponding amount, such
amount shall constitute such Lender’s Term Loan as part of such Borrowing for purposes of this
Agreement.



     SECTION 2.03. Borrowing Procedure. In order to request a Borrowing, the Borrower shall notify the
Administrative Agent by telephone (promptly confirmed by fax) or shall hand deliver or fax to the
Administrative Agent a duly completed Borrowing Request (a) in the case of a Eurodollar Borrowing,
not later than 12:00 (noon), New
York City time, three Business Days before a proposed Borrowing and (b) in the case of an ABR
Borrowing, not later than 12:00 (noon), New York City time, one Business Day before a proposed
Borrowing. Each Borrowing Request shall be irrevocable, shall be signed by or on behalf of the
Borrower and shall specify the following information: (i) whether the Borrowing then being
requested is to be a Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing
(which shall be a Business Day that shall occur on or prior to the Term Loan Commitment Termination
Date); (iii) the number and location of the account to which funds are to be disbursed; (iv) the
amount of such Borrowing which shall be in integral multiples of $1,000,000; and (v) if such
Borrowing is to be a Eurodollar Borrowing, the initial Interest Period with respect thereto;
provided, however, that, notwithstanding any contrary specification in any
Borrowing Request, each requested Borrowing shall comply with the requirements set forth in Section
2.02. If no election as to the Type of Borrowing is specified in any such notice, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period with respect to any
Eurodollar Borrowing is specified in any such notice, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration. The Administrative Agent shall



49









 




promptly
advise the applicable Lenders of any notice given in accordance with this Section 2.03 (and the
contents thereof), and of each Lender’s portion of the requested Borrowing.




     SECTION 2.04. Repayment of Term Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of each Lender the
principal amount of each Term Loan of such Lender made to the Borrower as provided in Section 2.11.



     (b) Each Lender shall maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower to such Lender resulting from each Term Loan made by
such Lender to the Borrower, including the amounts of principal and interest payable and paid to
such Lender from time to time under this Agreement, and shall provide copies of such accounts to
the Borrower upon its reasonable request (at the Borrower’s sole cost and expense).



     (c) The Administrative Agent shall maintain accounts in which it will record (i) the amount of
each Term Loan made hereunder, the Type thereof and the Interest Period applicable thereto, (ii)
the amount of any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender’s share thereof, and shall provide copies of such
accounts to the Borrower upon its reasonable request (at the Borrower’s sole cost and expense).



     (d) The entries made in the accounts maintained pursuant to paragraphs (b) and (c) of this
Section shall be conclusive evidence of the existence and amounts of the obligations therein
recorded absent clearly demonstrable error; provided, however, that the failure of
any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in
any manner affect the obligations of the Borrower to repay the Term Loans in accordance with the
terms of this Agreement.



     (e) Any Lender may request that Term Loans made by it hereunder be evidenced by a promissory
note. In such event, the Borrower shall execute and deliver to such Lender a promissory note
payable to such Lender and its registered assigns in the form of Exhibit J, or any other form
reasonably acceptable to the Administrative Agent. Notwithstanding any other provision of this
Agreement, in the event any Lender shall request and receive such a promissory note, the interests
represented by such note shall at all times (including after any assignment of all or part of such
interests pursuant to Section 9.04) be represented by one or more promissory notes payable to the
payee named therein or its registered assigns.



     SECTION 2.05. Fees. (a) The Borrower agrees to pay to each Lender, through the Administrative
Agent, on the last day of the Commitment Fee Period, a commitment fee (a “Commitment Fee”)
equal to the Commitment Fee Rate on the average daily unused amount of the Term Loan Commitments of
such Lender during the Commitment Fee Period; provided that, the Commitment Fee shall only
accrue during the Commitment Fee Period. All Commitment Fees shall be computed on the basis of the
actual number of days elapsed in a year of 360 days.



     (b) The Borrower agrees to pay to the Administrative Agent, for its own account, the fees in
the amounts and at the times from time to time agreed to in writing by the Borrower and the
Administrative Agent, including pursuant to the Fee Letter (the “Administrative Agent
Fees”).



     (c) [Reserved].



     (d) [Reserved].



50









 





     (e) All Fees shall be paid on the dates due, in immediately available funds, to the
Administrative Agent for distribution, if and as appropriate, among the Lenders. Once paid, none
of the Fees actually owed and due shall be refundable under any circumstances.



     SECTION 2.06. Interest on Term Loans. (a) Subject to the provisions of Section 2.07, the
outstanding Term Loans comprising each ABR Borrowing shall bear interest (computed on the basis of
the actual number of days elapsed over a year of 365 or 366 days, as the case may be, when the
Alternate Base Rate is determined by reference to the Prime Rate and over a year of 360 days at all
other times) at a rate per annum equal to the Alternate Base Rate plus the Applicable
Margin.



     (b) Subject to the provisions of Section 2.07, the Term Loans comprising each Eurodollar
Borrowing shall bear interest (computed on the basis of the actual number of days elapsed over a
year of 360 days) at a rate per annum equal to the Adjusted LIBO Rate for the Interest Period in
effect for such Borrowing plus the Applicable Margin.



     (c) Interest on each Term Loan shall be payable on the Interest Payment Dates applicable to
such Term Loan except as otherwise provided in this Agreement. Subject to Section 2.08, the
applicable Alternate Base Rate or Adjusted LIBO Rate for each Interest Period, as the case may be,
shall be determined by the Administrative Agent, and such determination shall, absent clearly
demonstrable error, be final and conclusive and binding on all parties hereto.



     SECTION 2.07. Default Interest. If the Borrower shall default in the payment of the principal of or
interest on any Term Loan or any other amount becoming due and payable hereunder or under any other
Loan Document, by acceleration or otherwise, the Borrower shall on demand from time to time pay
interest, to the extent permitted by law, on such defaulted amount to but excluding the date of
actual payment (after as well as before judgment) (a) in the case of overdue principal, at the rate
otherwise applicable to such Term Loan pursuant to Section 2.06 plus 2.00% per annum and
(b) in all other cases, at a rate per annum (computed on the basis of the actual number of days
elapsed over a year of 365 or 366 days, as the case may be, when determined by reference to the
Prime Rate and over a year of 360 days at all other times) equal to the rate that would be
applicable to an ABR Term Loan plus 2.00%.



     SECTION 2.08. Alternate Rate of Interest. In the event, and on each occasion, that prior to the
commencement of any Interest Period for a Eurodollar Borrowing (a) the Administrative Agent shall
have determined that adequate and reasonable means do not exist for determining the Adjusted LIBO
Rate for such Interest Period or (b) the Administrative Agent is advised by the Required Lenders
reasonably and in good faith that the Adjusted LIBO Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or maintaining their Term Loans
included in such Borrowing for such Interest Period, then the Administrative Agent shall, as soon
as practicable thereafter, give written or fax notice of such determination to the Borrower and the
Lenders. In the event of any such notice, until the Administrative Agent shall have advised the
Borrower and the Lenders that the circumstances giving rise to such written or fax notice no longer
exist, (i) any request by the Borrower for a Eurodollar Borrowing pursuant to Section 2.03 or 2.10
shall be deemed to be a request for an ABR Borrowing and (ii) any Interest Period election that
requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar
Borrowing shall be ineffective. Each determination by the Administrative Agent under this Section
2.08 shall, absent clearly demonstrable error, be final and conclusive and binding on all parties
hereto.



     SECTION 2.09. Termination and Reduction of Commitments. (a) Unless previously terminated in
accordance with the terms hereof, (i) the Term Loan Commitments shall automatically terminate upon
the funding of any Term Loans on the Funding Date or (ii) if not terminated earlier, the



51









 




Term Loan
Commitments shall automatically terminate at 5:00 p.m., New York City time, on the Term Loan
Commitment Termination Date.




     (b) Upon at least three Business Days’ prior irrevocable written or fax notice to the
Administrative Agent, the Borrower may at any time in whole permanently terminate, or from time to
time permanently reduce, in each case without premium or penalty, the Term Loan Commitments;
provided that, each partial reduction in the Term Loan Commitments shall be in an integral
multiple of $1,000,000 and in a minimum amount of $5,000,000.



     (c) Each reduction in the Term Loan Commitments hereunder shall be made ratably among the
applicable Lenders in accordance with their Pro Rata Percentage. The Borrower shall pay to the
Administrative Agent for the account of the applicable Lender, on the date of each termination or
reduction, the Commitment Fees on the amount of the Commitments so terminated or reduced accrued to
but excluding the date of such termination or reduction in accordance with the terms hereof.



     SECTION 2.10. Conversion and Continuation of Borrowings. The Borrower shall have the right at any
time upon prior irrevocable notice to the Administrative Agent (a) not later than 12:00 (noon), New
York City time, one Business Day prior to conversion, to convert any Eurodollar Borrowing of the
Borrower into an ABR Borrowing, (b) not later than 12:00 (noon), New York City time, three Business
Days prior to conversion or continuation, to convert any ABR Borrowing of the Borrower into a
Eurodollar Borrowing or to continue any Eurodollar Borrowing of the Borrower as a Eurodollar
Borrowing for an additional Interest Period and (c) not later than 12:00 (noon), New York City
time, three Business Days prior to conversion, to convert the Interest Period with respect to any
Eurodollar Borrowing of the Borrower to another permissible Interest Period, subject in each case
to the following:




     (i) each conversion or continuation shall be made pro rata among the Lenders in
accordance with the respective principal amounts of the Term Loans comprising the converted
or continued Borrowing;




     (ii) if less than all the outstanding principal amount of any Borrowing shall be
converted or continued, then each resulting Borrowing shall satisfy the limitations
specified in Sections 2.02(b) and 2.03 regarding the principal amount and maximum number of
Borrowings of the relevant Type;




     (iii) each conversion shall be effected by each Lender and the Administrative Agent by
recording for the account of such Lender the new Term Loan of such Lender resulting from
such conversion and reducing the Term Loan (or portion thereof) of such Lender being
converted by an equivalent principal amount; accrued and unpaid interest on any Eurodollar
Term Loan (or portion thereof) being converted shall be paid by the Borrower at the time of
conversion;




     (iv) if any Eurodollar Borrowing is converted at a time other than the end of the
Interest Period applicable thereto, the Borrower shall pay, upon demand, any amounts due to
the Lenders pursuant to Section 2.16;




     (v) any portion of a Borrowing maturing or required to be repaid in less than one month
may not be converted into or continued as a Eurodollar Borrowing;




     (vi) any portion of a Eurodollar Borrowing that cannot be converted into or continued
as a Eurodollar Borrowing by reason of the immediately preceding clause shall be
automatically converted at the end of the Interest Period in effect for such Borrowing into
an ABR Borrowing;



52









 






     (vii) no Interest Period may be selected for any Eurodollar Term Borrowing that would
end later than a Repayment Date occurring on or after the first day of such Interest Period
if, after giving effect to such selection, the aggregate outstanding amount of the sum of
(A) the Eurodollar Term Borrowings with Interest Periods ending on or prior to such
Repayment Date and (B) the ABR Term Borrowings would not be at least equal to the principal
amount of Term Borrowings to be paid on such Repayment Date; and




     (viii) after the occurrence and during the continuance of an Event of Default, no
outstanding Term Loan may be converted into, or continued as, a Eurodollar Term Loan.



     Each notice pursuant to this Section 2.10 shall be irrevocable and shall refer to this
Agreement and specify (i) the identity and amount of the Borrowing that the Borrower requests be
converted or continued, (ii) whether such Borrowing is to be converted to or continued as a
Eurodollar Borrowing or an ABR Borrowing, (iii) if such notice requests a conversion, the date of
such conversion (which shall be a Business Day) and (iv) if such Borrowing is to be converted to or
continued as a Eurodollar Borrowing, the Interest Period with respect thereto. If no Interest
Period is specified in any such notice with respect to any conversion to or continuation as a
Eurodollar Borrowing, the Borrower shall be deemed to have selected an Interest Period of one
month’s duration. The Administrative Agent shall advise the Lenders of any notice given pursuant
to this Section 2.10 and of each Lender’s portion of any converted or continued Borrowing. If the
Borrower shall not have given notice in accordance with this Section 2.10 to continue any Borrowing
into a subsequent Interest Period (and shall not otherwise have given notice in accordance with
this Section 2.10 to convert such Borrowing), such Borrowing shall, at the end of the Interest
Period applicable thereto (unless repaid pursuant to the terms hereof), automatically be converted
or continued into an ABR Borrowing.



     SECTION 2.11. Repayment of Term Borrowings. (a) The Borrower shall pay to the Administrative
Agent, for the account of the Term Lenders, a principal amount of the Term Loans (as adjusted from
time to time pursuant to Sections 2.12 and 2.13(e)) in an aggregate amount equal to the sum of the
principal amount of Term Loans made on the Funding Date multiplied by 0.25% on each full fiscal
quarter ending after the Funding Date and prior to the Term Loan Maturity Date (each, a
“Repayment Date”) with the remainder to be payable on the Term Loan Maturity Date, together
in each case with accrued and unpaid interest and Fees on the amount to be paid to but excluding
the date of such payment.



     (b) [Reserved].



     (c) To the extent not previously paid, all Term Loans shall be due and payable on the Term
Loan Maturity Date, together with accrued and unpaid interest on the principal amount to be paid to
but excluding the date of payment.



     (d) All repayments pursuant to this Section 2.11 shall be subject to Section 2.16, but shall
otherwise be without premium or penalty.



     SECTION 2.12. Prepayment. (a) The Borrower shall have the right at any time and from time to
time to prepay any Borrowing, in whole or in part, subject to the provisions of paragraph (d)
below, upon at least three Business Days’ prior written or fax notice (or telephone notice promptly
confirmed by written or fax notice) in the case of Eurodollar Term Loans, or written or fax notice
(or telephone notice promptly confirmed by written or fax notice) at least one Business Day prior
to the date of prepayment in the case of ABR Term Loans, to the Administrative Agent before 11:00
a.m., New York City time; provided, however, that each partial prepayment shall be
in an amount that is an integral multiple of $1,000,000 and not less than $5,000,000.



53









 





     (b) Optional prepayments of Term Loans shall be applied against the remaining scheduled
installments of principal due in respect of the Term Loans as directed by the Borrower.



     (c) Each notice of prepayment shall specify the prepayment date and the principal amount of
each Borrowing (or portion thereof) to be prepaid, shall be irrevocable and shall commit the
Borrower to prepay such Borrowing by the amount stated therein on the date stated therein;
provided that a notice of prepayment may state that such prepayment is conditioned upon the
effectiveness of other credit facilities or any other event, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified
prepayment date) if such condition is not satisfied. All prepayments and failures to prepay under
this Section 2.12 shall be subject to Section 2.16. All prepayments under this Section 2.12 shall
be accompanied by accrued and unpaid interest on the principal amount to be prepaid to but
excluding the date of payment.



     (d) Any (i) amendment, amendment and restatement or other modification of this Agreement
consummated after the Funding Date but on or prior to the first anniversary of the Funding Date or
(ii) voluntary prepayment of all but not less than all of the Term Loans consummated after the
Funding Date but on or prior to the first anniversary of the Funding Date with the proceeds of a
substantially concurrent issuance or incurrence of new bank loans (which voluntary prepayment shall
be deemed to have occurred even if a portion of the Term Loans are replaced, converted or
re-evidenced with, into or by such new loans so long as all but not less than all of the Term Loans
are so prepaid) the effect of which, in the case of either clause (i) or clause (ii), is to
decrease the Applicable Margin with respect to the Term Loans,
shall be accompanied by a fee payable to the Term Lenders (which shall include any
Non-Consenting Lender that is repaid in connection with any such amendment or amendment and
restatement) in an amount equal to 1.0% of the aggregate principal amount of the Term Loans then
outstanding only if such amendment, prepayment, replacement, conversion or re-evidencing is not
otherwise undertaken in connection with another material transaction or series of related material
transactions.



     SECTION 2.13. Mandatory Prepayments. (a) [Reserved].



     (b) Not later than the tenth Business Day following receipt of Net Cash Proceeds from (A) the
completion of any Holdings Asset Sale, or (B) the occurrence of any Holdings Recovery Event, the
Borrower shall offer to prepay outstanding Term Loans in an amount equal to the Required Prepayment
Percentage multiplied by the amount of such Net Cash Proceeds that is received, such prepayment to
be made in accordance with Section 2.13(e). Notwithstanding the foregoing, if the amount of Net
Cash Proceeds from the completion of any such Holdings Asset Sale or the occurrence of any such
Holdings Recovery Event required to be used to offer to prepay outstanding Term Loans pursuant to
this clause (b) is less than $10,000,000, such application of such Net Cash Proceeds may be
deferred until such time as the amount of such Net Cash Proceeds plus the aggregate amount
of all Net Cash Proceeds received thereafter from the completion of any such Holdings Asset Sale or
the occurrence of any such Holdings Recovery Event required to be so applied under this clause (b)
aggregates at least $10,000,000, at which time the Borrower shall apply the aggregate amount of all
such deferred Net Cash Proceeds to prepay outstanding Term Loans, such offer to prepay to be made
in accordance with Section 2.13(e).



     (c) In the event that the Borrower shall receive Net Cash Proceeds from the issuance or other
incurrence of Indebtedness of the Borrower (other than Indebtedness permitted pursuant to Section
6.01), the Borrower shall, substantially simultaneously with (and in any event not later than the
tenth Business Day next following) the receipt of such Net Cash Proceeds by the Borrower, apply an
amount equal to the Required Prepayment Percentage of such Net Cash Proceeds to offer to prepay
outstanding Term Loans, such offer to prepay to be made in accordance with Section 2.13(e).



54









 





     (d) No later than ten days following the earlier of (i) 90 days after the end of each fiscal
year, commencing with the fiscal year ending on December 31, 2008, and (ii) the date on which the
financial statements with respect to such period are delivered pursuant to Section 5.04(a)
(commencing with the fiscal year ending on December 31, 2008), the Borrower shall offer to prepay
(and prepay) outstanding Term Loans, such offer to prepay (and prepayment) to be made in accordance
with Section 2.13(e), in an aggregate principal amount equal to (x) the Required Prepayment
Percentage of Excess Cash Flow for the fiscal year then ended (the “Base Annual ECF Sweep
Amount”) minus (y) the aggregate amount of any voluntary prepayments of Term Loans
(under and as defined in the Opco Credit Agreement) made pursuant to Section 2.12 of the Opco
Credit Agreement during such fiscal year. Notwithstanding the foregoing, the Borrower shall have
the option to calculate Excess Cash Flow for one or more fiscal quarters of any fiscal year (with
respect to such fiscal quarter or any other immediately preceding fiscal quarter or fiscal quarters
during such fiscal year for which Excess Cash Flow had not previously been so calculated and the
prepayment offer in accordance with Section 2.13(d) and Section 2.13(e) below had not previously
been made); provided that in the event that the Borrower shall exercise such option, (i) no
later than ten days following the earlier of (A) 45 days after the end of the applicable fiscal
quarter and (B) the date on which financial statements with respect to such applicable fiscal
quarter are delivered pursuant Section 5.04(b), the Borrower shall offer to prepay outstanding Term
Loans, such offer of prepayment to be made in accordance with Section 2.13(e), in an aggregate
principal amount equal to (x) the Required Prepayment Percentage of Excess Cash Flow for the
applicable fiscal period then ended minus (y) the aggregate amount of any voluntary
prepayments of Term Loans (under and as defined in the
Opco Credit Agreement) made pursuant to Section 2.12 of the Opco Credit Agreement during such
applicable fiscal period and (ii) the Borrower shall continue to be required to make the offer to
prepay (and prepayment) described in the first sentence of this paragraph (d) following the end of
the applicable fiscal year in accordance with the provisions described above (provided that
the amount of Term Loans that the Borrower shall be required to prepay and offer to prepay with
respect to the Excess Cash Flow in respect of such fiscal year shall be governed by the proviso in
the first sentence of Section 2.13(e)). The Borrower shall provide the Administrative Agent with
written notice of any election described in the immediately preceding sentence to calculate Excess
Cash Flow (and make the required prepayment and prepayment offer) as of the end of any fiscal
quarter of any fiscal year no later than the earlier of (i) 45 days after the end of the applicable
fiscal quarter and (ii) the date on which financial statements with respect to such applicable
fiscal period are delivered pursuant to Section 5.04(b). For purposes of this Section 2.13(d), the
term “fiscal period” shall mean a period of one or more consecutive fiscal quarters.



     (e) Notwithstanding any provision in this Agreement to the contrary, but subject to the right
of each Term Lender to elect to decline all or any portion of any prepayment pursuant to Section
2.13(b), 2.13(c) or Section 2.13(d) as described below, the amount to be prepaid on any date
pursuant to Section 2.13(b), 2.13(c) or 2.13(d) shall be applied to the prepayment (to the extent
required to be so applied) of all Term Loans outstanding on such date; provided that,
notwithstanding anything in this Agreement to the contrary, in the case of any prepayment pursuant
to Section 2.13(d) in respect of a fiscal year (as opposed to any other fiscal period), on the date
of any prepayment offer that is required to be made pursuant to such Section in respect of a fiscal
year ended, (a) the Company shall be required to prepay outstanding Term Loans (under and as
defined in the Opco Credit Agreement) by an amount equal to, if positive, (i)(A) 50% of the Base
Annual ECF Sweep Amount for such fiscal year minus (B) the aggregate amount of any
voluntary prepayment of Term Loans (under and as defined in the Opco Credit Agreement) made
pursuant to Section 2.12 of the Opco Credit Agreement during such applicable fiscal year
(“Mandatory ECF Payment”) minus (ii) any amount that had been offered to, accepted
by and prepaid to the Term Lenders (under and as defined in the Opco Credit Agreement) at any time
during such fiscal year pursuant to clause (i) of the second sentence of Section 2.13(d) of the
Opco Credit Agreement (such amount set forth in the preceding clause (ii) in respect of such fiscal
year, the “Early Paid Amount”), and the Term Lenders (under and as defined in the Opco
Credit Agreement) shall have no right to decline all or any portion of such required prepayment
amount determined by such subtraction



55









 




and (b) the Borrower shall be required to offer to the Term
Lenders, and the Term Lenders shall have the right to decline all or any portion of such offered
amount, an amount equal to, (x) (A) if the outstanding principal amount of Term Loans is greater
than or equal to $500,000,000 as of the end of such fiscal year, the Pro Rata ECF Percentage of the
Base Annual ECF Sweep Amount for such fiscal year and (B) if the outstanding principal amount of
Term Loans is less than $500,000,000, 0% of the Base Annual ECF Sweep Amount for such fiscal year
minus in each case (y) if the Early Paid Amount for such fiscal year was more than the
Mandatory ECF Payment for such fiscal year, the amount by which such Early Paid Amount exceeded the
Mandatory ECF Payment.



No later than 5:00 p.m., New York City time, within the earlier of three Business Days (A) prior to
the applicable prepayment date or (B) after the Borrower has offered prepayment of the Term Loans
hereunder, each Term Lender may provide written notice to the Administrative Agent either (i)
setting forth the maximum amount of the aggregate amount of its Term Loans that it wishes to have
prepaid on such date pursuant to this Section (the “Requested Prepayment Amount”) or (ii)
declining in its entirety any prepayment on such date pursuant to this Section. In the event that
any Term Lender shall fail to provide such written notice to the Administrative Agent within the
time period specified above, such Term Lender shall be deemed to have elected a Requested
Prepayment Amount equal to its ratable share of such mandatory prepayment (determined based on the
percentage of the aggregate amount of all Term Loans represented by such Term Lender’s Term Loans
as determined immediately prior to such prepayment and without taking into account any Requested
Prepayment Amount of any other Lender). In
the event that the amount of any mandatory prepayment to be made pursuant to this Section shall be
equal to or exceed the aggregate amount of all Requested Prepayment Amounts of all Term Lenders
electing (or deemed to be electing) such a prepayment, each Term Lender electing (or deemed to be
electing) such a prepayment shall have an amount of its Term Loans prepaid that is equal to such
Term Lender’s Requested Prepayment Amount. In the event that the amount of any mandatory
prepayment to be made pursuant to this Section shall be less than the aggregate amount of all
Requested Prepayment Amounts of all Term Lenders electing (or deemed to be electing) such a
prepayment, each Term Lender electing (or deemed to be electing) such a prepayment shall have its
Term Loans prepaid in an amount equal to the product of (A) the amount of such mandatory prepayment
and (B) the percentage of the aggregate Requested Prepayment Amounts of all Term Lenders electing
(or deemed to be electing) such a prepayment represented by such Term Lender’s Requested Prepayment
Amount. Any residual amounts after any mandatory prepayments are made pursuant to this Section
2.13(e) shall be retained by the Borrower. Mandatory prepayments of outstanding Term Loans under
this Agreement shall be applied against the remaining scheduled installments due in respect of the
Term Loans under Section 2.11 as directed by the Borrower.




     (f) [Reserved].



     (g) The Borrower shall deliver to the Administrative Agent, at the time of each prepayment
required under this Section 2.13, (i) a certificate signed by a Financial Officer of the Borrower
setting forth in reasonable detail the calculation of the amount of such prepayment and (ii) to the
extent practicable, at least ten days prior written notice of such prepayment, (and the
Administrative Agent shall promptly provide the same to each Lender. Each notice of prepayment
shall specify the prepayment date, the Type of each Term Loan being prepaid and the principal
amount of each Term Loan (or portion thereof) to be prepaid. All prepayments of Borrowings
pursuant to this Section 2.13 shall be accompanied by accrued and unpaid interest on the principal
amount to be paid to but excluding the date of payment and shall be subject to Section 2.16, but
shall otherwise be without premium or penalty.



     SECTION 2.14. Reserve Requirements; Change in Circumstances. (a) Notwithstanding any other
provision of this Agreement, if any Change in Law shall:



56









 






     (i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit extended by,
any Lender or the Administrative Agent, or




     (ii) impose on any Lender or the Administrative Agent or the London interbank market
any other condition affecting this Agreement or Eurodollar Term Loans made by such Lender
(except any such reserve requirement which is reflected in the Adjusted LIBO Rate),


and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any Eurodollar Term Loan (or of maintaining its obligation to make any such Term Loan)
or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of
principal, interest or otherwise) by an amount reasonably deemed by such Lender or the
Administrative Agent to be material, then the Borrower will pay to such Lender or the
Administrative Agent, as the case may be, promptly upon demand such additional amount or amounts as
will compensate such Lender, as the case may be, for such additional costs incurred or reduction
suffered.




     (b) If any Lender or the Administrative Agent shall have determined that any Change in Law
regarding capital adequacy has or would have the effect of reducing the rate of return on such
Lender’s or
the Administrative Agent’s capital or on the capital of such Lender’s or the Administrative
Agent’s holding company, if any, as a consequence of this Agreement or the Terms Loans made by such
Lender to a level below that which such Lender or the Administrative Agent or such Lender’s or the
Administrative Agent’s holding company could have achieved but for such Change in Law (taking into
consideration such Lender’s or the Administrative Agent’s policies and the policies of such
Lender’s or the Administrative Agent’s holding company with respect to capital adequacy) by an
amount reasonably deemed by such Lender or the Administrative Agent to be material, then from time
to time the Borrower shall pay to such Lender or the Administrative Agent as the case may be, such
additional amount or amounts as will compensate such Lender or the Administrative Agent or such
Lender’s or the Administrative Agent’s holding company for any such reduction suffered.



     (c) A certificate of a Lender or the Administrative Agent setting forth the amount or amounts
reasonably determined by such Person to be necessary to compensate such Lender or the
Administrative Agent or its holding company, as applicable, as specified in paragraph (a) or (b) of
this Section, the calculations and criteria applied to determine such amount or amounts, and other
documentation or information reasonably supporting the conclusions in such certificate, shall be
delivered to the Borrower and shall, absent clearly demonstrable error, be final and conclusive and
binding. The Borrower shall pay such Lender or the Administrative Agent, as the case may be, the
amount or amounts shown as due on any such certificate delivered by it within 10 days after its
receipt of the same.



     (d) Failure or delay on the part of any Lender or the Administrative Agent to demand
compensation pursuant to this Section shall not constitute a waiver of such Lender’s or the
Administrative Agent’s right to demand such compensation; provided that the Borrower shall
not be under any obligation to compensate any Lender or the Administrative Agent under paragraph
(a) or (b) above for increased costs or reductions with respect to any period prior to the date
that is 270 days prior to such request; provided further that the foregoing
limitation shall not apply to any increased costs or reductions arising out of the retroactive
application of any Change in Law within such 270-day period. The protection of this Section shall
be available to each Lender and the Administrative Agent regardless of any possible contention of
the invalidity or inapplicability of the Change in Law that shall have occurred or been imposed.



     SECTION 2.15. Change in Legality. (a) Notwithstanding any other provision of this Agreement,
if any Change in Law shall make it unlawful for any Lender to make or maintain any



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Eurodollar Term
Loan or to give effect to its obligations as contemplated hereby with respect to any Eurodollar
Term Loan, then, by written notice to the Borrower (which notice shall include documentation or
information in reasonable detail supporting the conclusions in such notice) and to the
Administrative Agent:





     (i) such Lender may declare that Eurodollar Term Loans will not thereafter (for the
duration of such unlawfulness) be made by such Lender hereunder (or be continued for
additional Interest Periods and ABR Term Loans will not thereafter (for such duration) be
converted into Eurodollar Term Loans), whereupon any request for a Eurodollar Borrowing (or
to convert an ABR Borrowing to a Eurodollar Borrowing or to continue a Eurodollar Borrowing
for an additional Interest Period) shall, as to such Lender only, be deemed a request for an
ABR Term Loan (or a request to continue an ABR Term Loan as such for an additional Interest
Period or to convert a Eurodollar Term Loan into an ABR Term Loan, as the case may be),
unless such declaration shall be subsequently withdrawn; and




     (ii) such Lender may require that all outstanding Eurodollar Term Loans made by it be
converted to ABR Term Loans, in which event all such Eurodollar Term Loans shall be
automatically converted to ABR Term Loans as of the effective date of such notice as
provided in paragraph (b) below.


In the event any Lender shall exercise its rights under (i) or (ii) above, all payments and
prepayments of principal that would otherwise have been applied to repay the Eurodollar Term Loans
that would have been made by such Lender or the converted Eurodollar Term Loans of such Lender
shall instead be applied to repay the ABR Term Loans made by such Lender in lieu of, or resulting
from the conversion of, such Eurodollar Term Loans. Any such conversion of a Eurodollar Term Loan
under (i) above shall be subject to Section 2.16.




     (b) For purposes of this Section 2.15, a notice to the Borrower by any Lender shall be
effective as to each Eurodollar Term Loan made by such Lender, if lawful, on the last day of the
Interest Period then applicable to such Eurodollar Term Loan; in all other cases such notice shall
be effective on the date of receipt by the Borrower.



     SECTION 2.16. Indemnity. The Borrower shall indemnify each Lender against any loss or expense that
such Lender may sustain or incur as a consequence of (a) any event, other than a default by such
Lender in the performance of its obligations hereunder, which results in (i) such Lender receiving
or being deemed to receive any amount on account of the principal of any Eurodollar Term Loan prior
to the end of the Interest Period in effect therefor, (ii) the conversion of any Eurodollar Term
Loan to an ABR Term Loan, or the conversion of the Interest Period with respect to any Eurodollar
Term Loan, in each case other than on the last day of the Interest Period in effect therefor or
(iii) any Eurodollar Term Loan to be made by such Lender (including any Eurodollar Term Loan to be
made pursuant to a conversion or continuation under Section 2.10) not being made after notice of
such Term Loan shall have been given by the Borrower hereunder, (any of the events referred to in
this clause (a) being called a “Breakage Event”) or (b) any default in the making of any
payment or prepayment required to be made hereunder. In the case of any Breakage Event, such loss
shall include, in the case of a Lender, an amount equal to the excess, as reasonably determined by
such Lender, of (i) its cost of obtaining funds for the Eurodollar Term Loan that is the subject of
such Breakage Event for the period from the date of such Breakage Event to the last day of the
Interest Period in effect (or that would have been in effect) for such Term Loan over (ii) the
amount of interest likely to be realized by such Lender in redeploying the funds released or not
utilized by reason of such Breakage Event for such period. A certificate of any Lender setting
forth any amount or amounts which such Lender believes it is entitled to receive pursuant to this
Section 2.16, including the calculations and criteria applied to determine such amount or amounts,
and other



58









 




documentation or information reasonably supporting the conclusions in such certificate,
shall be delivered to the Borrower and shall, absent clearly demonstrable error, be final and
conclusive and binding.




     SECTION 2.17. Pro Rata Treatment. Except as required under Section 2.13, 2.14, 2.15 or 2.20, each
Borrowing, each payment or prepayment of principal of any Borrowing, each payment of interest on
the Term Loans, each payment of the Commitment Fees, each reduction of the Term Loan Commitments
and each conversion of any Borrowing to or continuation of any Borrowing as a Borrowing of any Type
shall be allocated pro rata among the Lenders in accordance with their respective applicable Term
Loan Commitments (or, if such Term Loan Commitments shall have expired or been terminated, in
accordance with the respective principal amounts of their outstanding Term Loans). Each Lender
agrees that in computing such Lender’s portion of any Borrowing to be made hereunder, the
Administrative Agent may, in its discretion, round each Lender’s percentage of such Borrowing to
the next higher or lower whole dollar amount.



     SECTION 2.18. Sharing of Setoffs. Each Lender agrees that if it shall, through the exercise of a
right of banker’s lien, setoff or counterclaim against the Borrower, or pursuant to a secured claim
under Section 506 of Title 11 of the United States Code or other security or interest arising from,
or in lieu of, such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means, obtain payment (voluntary or
involuntary) in respect of any Term Loan as a result of which the unpaid principal portion of its
Term Loans shall be proportionately less than the unpaid principal portion of the Term Loans of any
other Lender, it shall be deemed simultaneously to have purchased from such other Lender at face
value, and shall promptly pay to such other Lender the purchase price for, a participation in the
Term Loans of such other Lender, so that the aggregate unpaid principal amount of the Term Loans
and participations in Term Loans held by each Lender shall be in the same proportion to the
aggregate unpaid principal amount of all Term Loans then outstanding as the principal amount of its
Term Loans prior to such exercise of banker’s lien, setoff or counterclaim or other event was to
the principal amount of all Term Loans outstanding prior to such exercise of banker’s lien, setoff
or counterclaim or other event; provided, however, that if any such purchase or purchases
or adjustments shall be made pursuant to this Section 2.18 and the payment giving rise thereto
shall thereafter be recovered, such purchase or purchases or adjustments shall be rescinded to the
extent of such recovery and the purchase price or prices or adjustment restored without interest.
The Borrower expressly consents to the foregoing arrangements and agrees that any Lender holding a
participation in a Term Loan deemed to have been so purchased may exercise any and all rights of
banker’s lien, setoff or counterclaim with respect to any and all moneys owing by the Borrower to
such Lender by reason thereof as fully as if such Lender had made a Term Loan directly to the
Borrower in the amount of such participation.



     SECTION 2.19. Payments. (a) The Borrower shall make each payment (including principal of or
interest on any Borrowing or any Fees or other amounts) hereunder and under any other Loan Document
not later than 12:00 (noon), New York City time, on the date when due in immediately available
dollars, without setoff, defense or counterclaim. Each such payment (other than payments pursuant
to Sections 2.14, 2.16 or 2.20, which at the election of the Borrower may be made directly to the
Lender claiming the benefit of any such Sections) shall be made to the Administrative Agent at its
offices at Eleven Madison Avenue, New York, NY 10010 by wire transfer of immediately available
funds (or as otherwise agreed by the Borrower and the Administrative Agent). The
Administrative Agent shall pay to each Lender any payment received on such Lender’s behalf promptly
after the Administrative Agent’s receipt of such payment. All payments hereunder and under each
other Loan Document shall be made in dollars .



     (b) Except as otherwise expressly provided herein, whenever any payment (including principal
of or interest on any Borrowing or any Fees or other amounts) hereunder or under any other



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Loan
Document shall become due, or otherwise would occur, on a day that is not a Business Day, such
payment may be made on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of interest or Fees, if applicable.




     SECTION 2.20. Taxes. (a) Except as otherwise provided herein, any and all payments by or on
account of any obligation of the Borrower hereunder or under any other Loan Document shall be made
free and clear of and without deduction or withholding for any Indemnified Taxes or Other Taxes;
provided that if the Borrower shall be required to deduct or withhold any Indemnified Taxes
or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that
after making all required
deductions and withholdings (including deductions and withholdings applicable to additional
sums payable under this Section) the Administrative Agent or such Lender (as the case may be)
receives an amount equal to the sum it would have received had no such deductions and withholdings
been made, (ii) the Borrower shall make (or cause to be made) such deductions and withholdings and
(iii) the Borrower shall pay (or cause to be paid) the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law. In addition, the Borrower
hereunder shall pay (or cause to be paid) any Other Taxes imposed other than by deduction or
withholding to the relevant Governmental Authority in accordance with applicable law.



     (b) [Reserved].



     (c) The Borrower shall indemnify the Administrative Agent, and each Lender, within 10 days
after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent, or such Lender, as the case may be, or any of their respective
Affiliates, on or with respect to any payment by or on account of any obligation of the Borrower
hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) and any penalties, interest and
reasonable expenses arising therefrom or with respect thereto whether or not such Indemnified Taxes
or Other Taxes were correctly or legally imposed or asserted by the relevant Government Authority.
A certificate as to the amount of such payment or liability shall be delivered to the Borrower by a
Lender, or by the Administrative Agent on its behalf or on behalf of a Lender, promptly upon such
party’s determination of an indemnifiable event and such certificate shall be conclusive absent
clearly demonstrable error; provided that the failure to deliver such certificate shall not
affect the obligations of the Borrower under this Section 2.20(c) except to the extent the Borrower
is actually prejudiced thereby. Payment under this Section 2.20(c) shall be made within 15 days
from the date of delivery of such certificate; provided that the Borrower shall not be
obligated to make any such payment to the Administrative Agent, or the Lender (as the case may be)
in respect of penalties, interest and other liabilities attributable to any Indemnified Taxes or
Other Taxes if and to the extent that such penalties, interest and other liabilities are
attributable to the gross negligence or willful misconduct of the Administrative Agent, or such
Lender or to the failure of the Administrative Agent, or a Lender to deliver a timely certificate
as to the amount of an indemnifiable liability.



     (d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the
Borrower to a Governmental Authority, and in any event within 60 days of such payment being due,
the Borrower shall deliver to the Administrative Agent, the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory to the
Administrative Agent.



     (e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax
under the law of the jurisdiction in which the Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the reasonable written request of the
Borrower, such properly completed and executed documentation prescribed by applicable law as will
permit such payments to be made without



60









 




withholding or at a reduced rate; provided that
such Lender is legally entitled to complete, execute and deliver such documentation and in such
Lender’s judgment such completion, execution or delivery would not materially prejudice the legal
position of such Lender.




     In addition, each Foreign Lender shall (i) furnish on or before it becomes a party to this
Agreement either (a) two accurate and complete originally executed U.S. Internal Revenue Service
Form W-8BEN and/or Form W-8IMY, as applicable (or successor form) or (b) an accurate and complete
U.S. Internal Revenue Service Form W-8ECI (or successor form), certifying, in either case, to such
Foreign Lender’s legal entitlement to an exemption or reduction from U.S. federal withholding tax
with respect to
all interest payments hereunder, and (ii) provide a new Form W-8BEN and/or Form W-8IMY, as
applicable (or successor form) or Form W-8ECI (or successor form) upon the expiration or
obsolescence of any previously delivered form to reconfirm any complete exemption from, or any
entitlement to a reduction in, U.S. federal withholding tax with respect to any interest payment
hereunder; provided that any Foreign Lender that is not a “bank” within the meaning of Section
881(c)(3)(A) of the Code and is relying on the so-called “portfolio interest exemption” shall also
furnish a “Non-Bank Certificate” in the form of Exhibit I together with a Form W-8BEN (or successor
form). Notwithstanding any other provision of this paragraph, a Foreign Lender shall not be
required to deliver any form pursuant to this paragraph that such Foreign Lender is not legally
able to deliver.



     (f) Any Lender that is a United States person, as defined in Section 7701(a)(30) of the
Internal Revenue Code, and is not an exempt recipient within the meaning of Treasury Regulations
Section 1.6049-4(c) shall deliver to the Borrower (with a copy to the Administrative Agent) two
accurate and complete original signed copies of Internal Revenue Service Form W-9, or any successor
form that such person is entitled to provide at such time in order to comply with United States
back-up withholding requirements.



     (g) For purposes of this Section 2.20, in the case of any Lender that is treated as a
partnership for U.S. federal income tax purposes, any Taxes required to be deducted and withheld by
such Lender with respect to payments made by the Borrower under any Loan Document shall be treated
as Taxes required to be deducted by the Borrower, but only to the extent such Taxes would have been
required to be deducted and withheld by the Lender if it were treated as a corporation for U.S.
federal income tax purposes making such payments under the Loan Documents on behalf of the Borrower
and Excluded Taxes were defined by reference to the partner (treating the partner as a Foreign
Lender) to whom payments are made.



     (h) Without prejudice to the survival of any other agreement of the Borrower hereunder, the
agreements and obligations of the Borrower contained in this Section 2.20 shall survive the payment
in full of all amounts due hereunder.



     SECTION 2.21. Assignment of Commitments Under Certain Circumstances; Duty to Mitigate. (a) In
the event (i) any Lender delivers a certificate requesting compensation pursuant to Section 2.14,
(ii) any Lender delivers a notice described in Section 2.15 or (iii) the Borrower is required to
pay any additional amount to any Lender or any Governmental Authority on account of any Lender
pursuant to Section 2.20, the Borrower may, at its sole expense and effort (including with respect
to the processing and recordation fee referred to in Section 9.04(b)), upon notice to such Lender
and the Administrative Agent, require such Lender to transfer and assign, without recourse (in
accordance with and subject to the restrictions contained in Section 9.04), all of its interests,
rights and obligations under this Agreement to an assignee that shall assume such assigned
obligations (which assignee may be another Lender, if a Lender accepts such assignment);
provided that (x) such assignment shall not conflict with any law, rule or regulation or
order of any court or other Governmental Authority having jurisdiction, (y) the Borrower shall have
received the prior written consent of the Administrative Agent, which consent shall not



61









 




unreasonably be withheld or delayed, and (z) the Borrower or such assignee shall have paid to the
affected Lender in immediately available funds an amount equal to the sum of the principal of and
interest accrued to the date of such payment on the outstanding Term Loans of such Lender,
plus all Fees and other amounts accrued for the account of such Lender hereunder (including
any amounts under Section 2.14 and Section 2.16); provided further that, if prior
to any such transfer and assignment the circumstances or event that resulted in such Lender’s claim
for compensation under Section 2.14 or notice under Section 2.15 or the amounts paid pursuant to
Section 2.20, as the case may be, cease to cause such Lender to suffer increased costs or
reductions in amounts received or receivable or
reduction in return on capital, or cease to have the consequences specified in Section 2.15,
or cease to result in amounts being payable under Section 2.20, as the case may be (including as a
result of any action taken by such Lender pursuant to paragraph (b) below), or if such Lender shall
waive its right to claim further compensation under Section 2.14 in respect of such circumstances
or event or shall withdraw its notice under Section 2.15 or shall waive its right to further
payments under Section 2.20 in respect of such circumstances or event, as the case may be, then
such Lender shall not thereafter be required to make any such transfer and assignment hereunder.




     (b) If (i) any Lender, shall request compensation under Section 2.14, (ii) any Lender delivers
a notice described in Section 2.15 or (iii) the Borrower is required to pay any additional amount
to any Lender or any Governmental Authority on account of any Lender pursuant to Section 2.20, then
such Lender shall use reasonable efforts (which shall not require such Lender to incur an
unreimbursed loss or unreimbursed cost or expense or otherwise take any action inconsistent with
its internal policies or legal or regulatory restrictions or suffer any disadvantage or burden
reasonably deemed by it to be significant) (x) to file any certificate or document reasonably
requested in writing by the Borrower or (y) to assign its rights and delegate and transfer its
obligations hereunder to another of its offices, branches or affiliates, if such filing or
assignment would reduce or eliminate its claims for compensation under Section 2.14 or enable it to
withdraw its notice pursuant to Section 2.15 or would reduce or eliminate amounts payable pursuant
to Section 2.20, as the case may be, in the future. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such filing or
assignment, delegation and transfer.



ARTICLE III.




Representations and Warranties




     The Borrower represents and warrants to the Arrangers, the Administrative Agent, the
Collateral Agent and each of the Lenders that:



     SECTION 3.01. Organization; Powers. The Borrower, the Company and each of their Subsidiaries (a) is
duly organized or formed, validly existing and in good standing under the laws of the jurisdiction
of its organization or formation, (b) has all requisite power and authority, and the legal right,
to own and operate its property and assets, to lease the property it operates as lessee and to
carry on its business as now conducted and, except to the extent the failure to do so could not
reasonably be expected to result in a Material Adverse Effect, as proposed to be conducted, (c) is
qualified to do business in, and is in good standing in, every jurisdiction where such
qualification is required, except where the failure so to qualify, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect and (d) has the
power and authority, and the legal right, to execute, deliver and perform its obligations under
this Agreement, each of the other Loan Documents, and each other agreement or instrument
contemplated hereby or thereby to which it is or will be a party, including, in the case of the
Borrower, to borrow hereunder and to grant the Liens contemplated to be granted by it under the
Security Documents.



62









 





     SECTION 3.02. Authorization; No Conflicts. The Transactions (a) have been duly authorized by all
requisite corporate, partnership or limited liability company and, if required, stockholder,
partner or member action (assuming that prior to the Funding Date, the Transactions to occur on the
Funding Date have been authorized by the Capital Allocation Committee created by the Board of
Directors of the Company pursuant to resolutions delivered to the administrative agent under the
Opco Credit Agreement on the date hereof (the “Capital Allocation Committee”)), and (b) assuming at any time prior to the Funding Date that the consents
and approvals described in clause (c), (d) and (e) of Section 3.04 have been obtained, will not (i)
violate (A) any applicable provision of any material law, statute, rule or regulation, or of the
certificate or articles of incorporation or other constitutive documents or by-laws of the
Borrower, the Company or any of their Subsidiaries, (B) any order of any Governmental Authority or
arbitrator or (C) any provision of any indenture or any material agreement or other material
instrument to which the Borrower, the Company or any of their Subsidiaries is a party or by which
any of them or any of their property is or may be bound, (ii) be in conflict with, result in a
breach of or constitute (alone or with notice or lapse of time or both) a default under, or give
rise to any right to accelerate or to require the prepayment, repurchase or redemption of any
obligation under any such indenture or material agreement or other material instrument or (iii)
result in the creation or imposition of any Lien upon or with respect to any property or assets now
owned or hereafter acquired by the Borrower (other than Liens created under the Security
Documents).



     SECTION 3.03. Enforceability. This Agreement has been duly executed and delivered by the Borrower
and constitutes, and each other Loan Document when executed and delivered by the Borrower will
constitute, a legal, valid and binding obligation of the Borrower enforceable against the Borrower
in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other laws now or hereafter in effect relating to creditors’
rights generally and (including with respect to specific performance) subject to general principles
of equity, regardless of whether considered in a proceeding in equity or at law, and to the
discretion of the court before which any proceeding therefor may be brought.



     SECTION 3.04. Governmental Approvals. No action, consent or approval of, registration or filing
with, notice to, or any other action by, any Governmental Authority is or will be required in
connection with the Transactions, except for (a) the filing of UCC financing statements and filings
with the United States Patent and Trademark Office and the United States Copyright Office, (b)
recordation of the Mortgages if any, (c) such other actions specifically described in Section 3.19,
(d) prior to the Funding Date, such approval of FERC under Section 203 of the Federal Power Act as
may be required for the Transactions, (e) prior to the Funding Date, such approval of, or finding
that no approval is required by, the NYPSC as may be required for the Transactions, (f) prior to
the Funding Date, such consent of the Nuclear Regulatory Commission pursuant to Section 184 of the
Atomic Energy Act of 1954 and 10 C.F.R. § 50.80 in connection with the Transactions, (f) any
immaterial actions, consents, approvals, registrations or filings or (h) such as have been made or
obtained and are in full force and effect.



     SECTION 3.05. Financial Statements. (a) The Borrower has, on or prior to the Closing Date,
furnished to the Lenders (i) the Company’s consolidated balance sheets and statements of income and
stockholder’s equity as of and for the fiscal years ended December 31, 2006, December 31, 2005 and
December 31, 2004, in each case, audited by and accompanied by the opinion of KPMG LLP, independent
public accountants. Such financial statements present fairly in all material respects the
financial condition and results of operations of the Company and its consolidated subsidiaries as
of such dates and for such periods. Such balance sheets and the notes thereto disclose all
material liabilities, direct or contingent, of the Company and its consolidated subsidiaries as of
the dates thereof. Such financial statements were prepared in accordance with GAAP applied on a
consistent basis.



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     (b) The Borrower has heretofore delivered to the Lenders the Company’s unaudited pro forma
consolidated capitalization as of March 31, 2007, prepared giving effect to the Transactions as if
they had occurred on such date. Such pro forma capitalization statement (i) has been prepared in
good faith by the Borrower, based on the assumptions used to prepare the pro forma financial
information contained in the Confidential Information Memorandum (which assumptions are believed by
the Borrower on the Closing Date to be reasonable in all material respects) and (ii) presents
fairly in all material respects on a pro forma basis the estimated capitalization of the Company
and its consolidated Subsidiaries as of such date, assuming that the Transactions had actually
occurred at such date (it being understood that estimates (including pro forma financial
statements), by their nature, are inherently uncertain and that no assurances are being given that
such results will be achieved).



     SECTION 3.06. No Material Adverse Change. As of the Closing Date, no event, change or condition has
occurred that has had, or could reasonably be expected to have, a Material Adverse Effect since
December 31, 2006. After the Closing Date, no event, change or condition has occurred that has
had, or could reasonably be expected to have, a Funding Date Material Adverse Effect since the
Closing Date.



     SECTION 3.07. Title to Properties; Possession Under Leases. (a) The Borrower has good and
marketable title to, valid leasehold interests in, or a license or other right to use, all its
material properties and material assets that are included in the Collateral, free and clear of all
Liens or other exceptions to title other than Permitted Liens and minor defects in title that, in
the aggregate, are not substantial in amount and do not materially detract from the value of the
property subject thereto or interfere with its ability to conduct its business as currently
conducted or to utilize such properties and assets for their intended purposes.



     SECTION 3.08. Subsidiaries. Schedule 3.08 sets forth as of the Closing Date (but giving effect to
the Transactions as if consummated on such date) a list of all Subsidiaries, including each
Subsidiary’s exact legal name (as reflected in such Subsidiary’s certificate or articles of
incorporation or other constitutive documents) and jurisdiction of incorporation or formation and
the percentage ownership interest of the Borrower (direct or indirect) therein, and identifies each
Subsidiary that is an Opco Loan Party as of the Closing Date. As of the Closing Date (but giving
effect to the Transactions as if consummated on such date), the shares of capital stock or other
Equity Interests so indicated on Schedule 3.08 are owned by the Borrower, directly or indirectly,
free and clear of all Liens (other than Liens created under the Security Documents and, in the case
of Equity Interests (other than Pledged Securities), Permitted Liens, and in respect of Pledged
Securities, the Permitted Liens set forth in clause (h) of the definition thereof) and all such
shares of capital stock are fully paid, and to the extent issued by a corporation, non-assessable.



     SECTION 3.09. Litigation; Compliance with Laws. (a) Except as set forth on Schedule 3.09,
there are no actions, suits or proceedings at law or in equity or by or before any arbitrator or
Governmental Authority now pending or, to the knowledge of the Borrower, threatened against the
Borrower, the Company or any of their Subsidiaries or any business, property or material rights of
the Borrower, the Company or any of their Subsidiaries (i) that, as of the Closing Date, involve
any Loan Document or the Transactions or, at any time thereafter, involve any Loan Document or the
Transactions and which could reasonably be expected to be material and adverse to the interests of
the Borrower, the Company and their Subsidiaries, taken as a whole, or the Lenders, or (ii) as to
which there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the aggregate, to
result in, as of the Closing Date, a Material Adverse Effect or, after the Closing Date, a Funding
Date Material Adverse Effect.



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     (b) Except as set forth on Schedule 3.09, none of the Borrower, the Company or any of their
Subsidiaries or any of their respective material properties or assets is in violation of any law,
rule or regulation (including any zoning, building, ordinance, code or approval or any building
permits), or is in default with respect to any judgment, writ, injunction, decree or order of any
Governmental Authority, where such violation or default, individually or in the aggregate, could
reasonably be expected to result in as of the Closing Date, a Material Adverse Effect or, after the
Closing Date, a Funding Date Material Adverse Effect (but not including, in each case, any
Environmental Law which is the subject of Section 3.17 or any energy regulation matter which is the
subject of Section 3.23).



     SECTION 3.10. Agreements. None of the Borrower, the Company or any of their Subsidiaries is in
default under any provision of any indenture or other agreement or instrument evidencing
Indebtedness, or any other material agreement or instrument to which it is a party or by which it
or any of its properties or assets are or may be bound, where such default, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.



     SECTION 3.11. Federal Reserve Regulations. (a) None of the Borrower, the Company or any of
their Subsidiaries is engaged principally, or as one of its material activities, in the business of
extending credit for the purpose of buying or carrying Margin Stock.



     (b) No part of the proceeds of any Term Loan will be used, whether directly or indirectly, and
whether immediately, incidentally or ultimately, for purchasing or carrying Margin Stock or for the
purpose of purchasing, carrying or trading in any securities under such circumstances as to involve
the Borrower in a violation of Regulation X or to involve any broker or dealer in a violation of
Regulation T. No Indebtedness being reduced or retired out of the proceeds of any Term Loans was
or will be incurred for the purpose of purchasing or carrying any Margin Stock. Following the
application of the proceeds of the Term Loans, Margin Stock will not constitute more than 25% of
the value of the assets of the Borrower and the Subsidiaries. None of the transactions
contemplated by this Agreement will violate or result in the violation of any of the provisions of
the Regulations of the Board, including Regulation T, U or X. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form G-3 or FR Form U-1
referred to in Regulation U.



     SECTION 3.12. Investment Company Act. Neither the Borrower nor the Company is an “investment
company” as defined in, and subject to registration under, the Investment Company Act of 1940, as
amended from time to time.



     SECTION 3.13. Use of Proceeds. The Borrower will use the proceeds of the Term Loans made on the
Funding Date solely to make the Holdings Contribution and the Company will, in turn, use the
proceeds received therefrom to repay Term Loans under and as defined in the Opco Credit Agreement
and the Borrower and/or the
Company may pay fees, costs and expenses incurred in connection therewith and with the other
Transactions.



     SECTION 3.14. Tax Returns. The Borrower, the Company and each of their Subsidiaries has timely
filed or timely caused to be filed all material Federal, state, local and foreign tax returns or
materials required to have been filed by it and all such tax returns are correct and complete in
all material respects. The Borrower, the Company and each of their Subsidiaries has timely paid or
caused to be timely paid all material Taxes due and payable by it and all assessments received by
it, except Taxes that are being contested in good faith by appropriate proceedings and for which
the Borrower, the Company or such Subsidiary, as applicable, shall have set aside on its books
adequate reserves in accordance with GAAP or except where the failure to do so could not reasonably
be expected to result in a Material Adverse Effect. The Borrower or the Company, as applicable,
has made adequate provision in



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accordance with GAAP for all Taxes accrued and not yet due and
payable. Except as permitted in clause (bb) of the definition of “Permitted Liens”, no Lien for
Taxes has been filed (except for Taxes not yet delinquent that are being contested in good faith by
appropriate proceedings), and to the knowledge of the Borrower, the Company and each of their
Subsidiaries, based on the receipt of written notice, no claim is being asserted, with respect to
any Tax. Neither the Borrower, the Company nor any of their Subsidiaries (a) intends to treat the
Term Loans or any of the transactions contemplated by any Loan Document as being a “reportable
transaction” (within the meaning of Treasury Regulation Section 1.6011-4) or (b) is aware of any
facts or events that would result in such treatment.




     SECTION 3.15. No Material Misstatements. None of (a) the Confidential Information Memorandum or (b)
any other written information, report, financial statement, exhibit or schedule furnished by or on
behalf of the Borrower, the Company or any of their Subsidiaries (other than information of a
general economic or industry nature) to the Arrangers, the Administrative Agent or any Lender for
use in connection with the transactions contemplated by the Loan Documents or in connection with
the negotiation of any Loan Document or included therein or delivered pursuant thereto contained,
contains or will contain (as of the date of its delivery to the Arrangers, the Administrative Agent
or any Lender or, as modified or supplemented, as of the Closing Date) any material misstatement of
fact or omitted, omits or will omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were, are or will be made, not
misleading; provided that to the extent any such written information, report, financial
statement, exhibit or schedule was based upon or constitutes a forecast or projection (including
pro forma financial statements), the Borrower represents only that it acted in good faith and upon
assumptions believed to be reasonable at the time, it being understood that projections are subject
to significant uncertainties and contingencies, many of which are beyond the control of the
Borrower, the Company and their Subsidiaries, and that no assurance can be given that such
projections will be realized.



     SECTION 3.16. Employee Benefit Plans. Except as could not reasonably be expected to result in a
Material Adverse Effect, the Borrower and each ERISA Affiliate is in compliance with the applicable
provisions of ERISA and, in respect of the Benefit Plans and Multiemployer Plans, the Tax Code and
the regulations and published interpretations thereunder. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA Events, could
reasonably be expected to result in a Material Adverse Effect.



     SECTION 3.17. Environmental Matters
.. (a) Except as set forth in Schedule 3.17 or except with respect to any matters that,
individually or in the aggregate, could not reasonably be expected to result in as of the Closing
Date, a Material Adverse Effect or, after the Closing Date, a Funding Date Material Adverse Effect,
none of the Borrower, the Company or any of their Subsidiaries:




     (i) has failed to comply with any Environmental Law or to take all actions necessary to
obtain, maintain, renew and comply with any permit, license, registration or other approval
required under Environmental Law;




     (ii) has become a party to any administrative or judicial proceeding, or possesses
knowledge of any such proceeding that has been threatened, that could result in the
termination, revocation or modification of any permit, license, registration or other
approval required under Environmental Law;




     (iii) possesses knowledge that the Borrower, the Company or any of their Subsidiaries
has become subject to any Environmental Liability on any Mortgaged Property (A) is subject
to any Lien imposed pursuant to Environmental Law or (B) contains Hazardous Materials of a
form



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or type or in a quantity or location that could reasonably be expected to result in any
Environmental Liability;




     (iv) has received written notice of any claim or threatened claim, with respect to any
Environmental Liability other than those which have been fully and finally resolved and for
which no obligations remain outstanding; or




     (v) possesses knowledge of any facts or circumstances that could reasonably be expected
to result in any Environmental Liability or could reasonably be expected to materially
interfere with or prevent continued material compliance with Environmental Laws in effect as
of the Closing Date and the Funding Date by the Borrower or the Subsidiaries.



     (b) Since the Closing Date, there has been no change in the status of the matters disclosed on
Schedule 3.17 that, individually or in the aggregate, has resulted in, or could reasonably be
expected to result in, a Funding Date Material Adverse Effect.



     The representations and warranties in this Section 3.17 are the sole representations and
warranties in any Loan Document with respect to environmental matters, including without
limitation, those relating to Environmental Law or Hazardous Materials.



     SECTION 3.18. Insurance. Schedule 3.18 sets forth a true, complete and correct description of all
material insurance coverage maintained by or on behalf of the Borrower, the Company and their
Subsidiaries as of the Closing Date. As of the Closing Date, such insurance is in full force and
effect and all premiums that are due and owed have been duly paid. The Borrower, the Company and
their Subsidiaries are insured by financially sound insurers and such insurance is in such amounts
and covering such risks and liabilities (and with such deductibles, retentions and exclusions) as
are maintained by companies of a similar size operating in the same or similar businesses.



     SECTION 3.19. Security Documents. (a) The Collateral Agreement is effective to create in favor
of the Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid, binding
and enforceable security interest in the
Collateral described therein and proceeds thereof, subject to applicable insolvency,
bankruptcy, reorganization, moratorium, fraudulent transfer and other laws now or hereafter in
effect generally affecting rights of creditors and (including with respect to specific performance)
principles of equity, whether considered in a proceeding in equity or in law and to the discretion
of the court before which any proceeding therefor may be brought, and (i) in the case of the
Pledged Securities, upon the earlier of (A) when such Pledged Securities are delivered to the
Collateral Agent and (B) when financing statements in appropriate form are filed in the offices
specified on Schedule 3.19(a), (ii) in the case of Deposit Accounts not constituting Excluded
Perfection Assets, by the execution and delivery of control agreements providing for “control” as
described in Section 9-104 of the UCC, (iii) in the case of Securities Accounts not constituting
Excluded Perfection Assets, upon the earlier of (A) the filing of financing statements in the
offices specified on Schedule 3.19(a) and (B) the execution and delivery of control agreements
providing for “control” as described in Section 9-106 of the UCC and (iv) in the case of all other
Collateral described therein (other than Excluded Perfection Assets, Intellectual Property
Collateral, money not credited to a Deposit Account or letter of credit rights not constituting
supporting obligations), when financing statements in appropriate form are filed in the offices
specified on Schedule 3.19(a), the Collateral Agreement shall constitute a fully perfected Lien on,
all right, title and interest of the Borrower in such Collateral and proceeds thereof, as security
for the obligations hereunder, in each case prior and superior to the rights of any other Person
(except, in the case of all Collateral other than Pledged Securities, with respect to Permitted
Liens, and in respect of Pledged Securities, the Permitted Liens set forth in clause (h) of the
definition thereof).



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     (b) Each Intellectual Property Security Agreement is effective to create in favor of the
applicable Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid,
binding and enforceable security interest in the Intellectual Property Collateral described therein
and proceeds thereof, subject to applicable insolvency, bankruptcy, reorganization, moratorium,
fraudulent transfer and other laws now or hereafter in effect generally affecting rights of
creditors and (including with respect to specific performance) principles of equity, whether
considered in a proceeding in equity or in law and to the discretion of the court before which any
proceeding therefor may be brought. When each Intellectual Property Security Agreement (if any) is
filed in the United States Patent and Trademark Office and the United States Copyright Office,
respectively, together with financing statements in appropriate form filed in the offices specified
in Schedule 3.19(a), in each case within the time period prescribed by applicable law, such
Intellectual Property Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the grantors thereunder in the Intellectual Property
Collateral, as security for the obligations hereunder, in each case prior and superior in right to
any other Person (except with respect to Permitted Liens) (it being understood that subsequent
recordings in the United States Patent and Trademark Office and the United States Copyright Office
may be necessary to perfect a Lien on registered trademarks, trademark applications, patents,
patent applications and copyrights acquired by the grantors after the Closing Date).



     (c) Each of the Mortgages (if any) is effective to create in favor of the applicable
Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid, binding,
subsisting and enforceable Lien on, and security interest in, all of the Borrower’s right, title
and interest in and to the Mortgaged Property thereunder and proceeds thereof, subject to
applicable insolvency, bankruptcy, reorganization, moratorium, fraudulent transfer and other laws
now or hereafter in effect generally affecting rights of creditors and (including with respect to
specific performance) principles of equity, whether considered in a proceeding in equity or in law,
and to the discretion of the court before which any proceeding therefor may be brought, and when
the Mortgages are filed in the offices specified on Schedule 3.19(c) (or such offices as are
otherwise agreed between the Borrower and the Collateral Agent), each such Mortgage shall
constitute a fully perfected Lien on, and security interest in, all right, title and interest of
the grantors thereof in such Mortgaged Property and proceeds thereof, as security for the
obligations hereunder, in each case prior and superior in right to any other Person (except Liens
expressly permitted by clauses (f),
(h), (i), (j), (k) (solely to the extent that such Lien relating to such Permitted Refinancing
Indebtedness was permitted prior to such refinancing by clause (f), (h), (i), (j), (n) or (p)),
(n), (p), (q)(ii), (dd) and (ff) of the definition of “Permitted Liens”).



     SECTION 3.20. [Reserved].



     SECTION 3.21. Labor Matters. As of the Closing Date, there are no strikes, lockouts or slowdowns
against the Borrower, the Company or any of their Subsidiaries pending or, to the knowledge of the
Borrower, threatened. All payments due from the Borrower, the Company or any of their
Subsidiaries, or for which any claim may be made against the Borrower, the Company or any of their
Subsidiaries, on account of wages and employee health and welfare insurance and other benefits,
have been paid or accrued as a liability on the books of the Borrower, the Company or such
Subsidiary, except as could not reasonably be expected to have a Material Adverse Effect. The
consummation of the Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement to which the
Borrower, the Company or any of their Subsidiaries is bound.



     SECTION 3.22. Intellectual Property. Except as could not reasonably be expected to result in a
Material Adverse Effect, the Borrower, the Company and each of their Subsidiaries owns, or is
licensed or otherwise has the right to use, all trademarks, tradenames, copyrights, patents and
other intellectual



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property material to its business, and the use thereof by the Borrower, the
Company and their Subsidiaries does not infringe upon the rights of any other Person.




     SECTION 3.23. Energy Regulation. (a) The Borrower, the Company and any Opco Subsidiary
Guarantor that is a holding company as such term is defined in PUHCA is exempt in accordance with
18 CFR § 366.3 from the accounting, record-retention and reporting requirements of PUHCA.



     (b) The Borrower and the Company are not subject to regulation as a “public utility” as such
term is defined in the FPA. Each Opco Subsidiary Guarantor that is subject to regulation as a
“public utility” as such term is defined in the FPA and that makes sales of energy or capacity that
are not pursuant to a state regulatory authority’s implementation of PURPA has an order from the
FERC, which order is not subject to any pending challenge, investigation, complaint, or other
proceeding, except as could not reasonably be expected to result in as of the Closing Date, a
Material Adverse Effect or, after the Closing Date, a Funding Date Material Adverse Effect and
other than generic proceedings generally applicable in the industry, (x) authorizing such Opco
Subsidiary Guarantor to engage in wholesale sales of electricity and, to the extent permitted under
its market-based rate tariff, other transactions at market-based rates and (y) granting such
waivers and blanket authorizations as are customarily granted to entities with market-based rate
authority, including blanket authorizations to issue securities and to assume liabilities pursuant
to Section 204 of the FPA. With respect to each Opco Subsidiary Guarantor described in the
preceding sentence, except as could not reasonably be expected to result in as of the Closing Date,
a Material Adverse Effect or, after the Closing Date, a Funding Date Material Adverse Effect and
except as set forth on Schedule 3.23(b), the FERC has not imposed any rate caps, mitigation
measures, or other limits on market-based sales of power by that Opco Subsidiary Guarantor, other
than (i) rate caps and mitigation measures generally applicable to similarly situated marketers or
generators selling electricity, ancillary
services or other services at wholesale at market-based rates in the geographic market where
such Opco Subsidiary Guarantor conducts its business, and (ii) the restrictions imposed on Cabrillo
Power I LLC, Cabrillo Power II LLC, Devon Power LLC, Middletown Power LLC, Montville Power LLC,
Norwalk Power LLC, and Connecticut Jet Power LLC pursuant to those entities’ “reliability must run”
agreements and/or other agreements /arrangements with the independent system operators, or other
similar arrangements.



     (c) Each Opco Subsidiary Guarantor participating in the wholesale power market in ERCOT
has registered with the PUCT to sell electricity at wholesale at market-based rates, and, except as
could not reasonably be expected to result in            as of the Closing Date, a Material Adverse
Effect or, after the Closing Date, a Funding Date Material Adverse Effect, the PUCT has not
imposed any specific rate cap or mitigation measure (other than generic proceedings generally
applicable in the industry). To its knowledge, as of the Closing Date, the rates charged by each
such Opco Subsidiary Guarantor are not subject to any pending challenge or investigation .



     (d) Except as could not reasonably be expected to result in as of the Closing Date, a Material
Adverse Effect or, after the Closing Date, a Funding Date Material Adverse Effect and except as set
forth on Schedule 3.23(d), there are no complaint proceedings pending with the FERC or the PUCT
seeking abrogation or modification, or otherwise investigating the terms, of a contract for the
sale of power by the Borrower, the Company or the Opco Subsidiary Guarantors.



     (e) Except as could not reasonably be expected to result in as of the Closing Date, a Material
Adverse Effect or, after the Closing Date, a Funding Date Material Adverse Effect, each of the
Borrower, the Company and each of the Opco Subsidiary Guarantors, as applicable, has filed or
caused to be filed with the applicable state or local utility commission or regulatory bodies,
ERCOT and the FERC all forms, applications, notices, statements, reports and documents (including
all exhibits and amendments



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thereto) required to be filed by it under all Applicable Laws,
including PUHCA, the FPA and state utility laws and the respective rules thereunder, all of which
complied with the applicable requirements of the appropriate act and rules, regulations and orders
thereunder in effect on the date each was filed.




     (f) None of the Borrower, the Company or any of the Opco Subsidiary Guarantors is subject to
any material state laws or material regulations respecting rates or the financial or organizational
regulation of utilities, other than (i) with respect to those Opco Subsidiary Guarantors that are
QFs, such state regulations contemplated by 18 C.F.R. Section 292.602(c), (ii) “lightened
regulation” by the New York State Public Service Commission (the “NYPSC”) of the type
described in the NYPSC’s order issued on September 23, 2004 in Case 04-E-0884 and (iii) the
assertion of jurisdiction by the State of California over maintenance and operating standards of
all generating facilities pursuant to SB 39XX.



     (g) As of the date of this Agreement, each Facility identified as a “QF” in Schedule 3.23(g)
is a QF under PURPA and the current rules and regulations promulgated thereunder. As of the date
of this Agreement, each person identified as an “EWG” in Schedule 3.23(g) is an “exempt wholesale
generator” within the meaning of PUHCA and the Energy Policy Act of 2005, as amended. As of the
date of this Agreement, each person identified as a FUCO in Schedule 3.23(g) is a “foreign utility
company” within the meaning of PUHCA.



     SECTION 3.24. Solvency. As of the Funding Date, and immediately following the making of the Term
Loans on the Funding Date and after giving effect to the application of the proceeds of the Term
Loans, (a) the fair value of the assets of the Borrower, the Company and their Subsidiaries, taken
as a whole, at a fair
valuation, taking into account the effect of any indemnities, contribution or subrogation
rights, will exceed their debts and liabilities, subordinated, contingent or otherwise; (b) the
present fair saleable value of the property of the Borrower, the Company and their Subsidiaries,
taken as a whole, taking into account the effect of any indemnities, contribution or subrogation
rights, will be greater than the amount that will be required to pay the probable liability of
their debts and other liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (c) the Borrower, the Company and their Subsidiaries,
taken as a whole, will be able to pay their debts and liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured; and (d) the Borrower, the
Company and their Subsidiaries, taken as a whole, will not have unreasonably small capital with
which to conduct the business in which they are engaged as such business is now conducted and is
proposed to be conducted following the Funding Date.



ARTICLE IV.




Conditions of Lending




     The obligations of the Lenders to make Term Loans hereunder are subject to the satisfaction
(or waiver in accordance with Section 9.08) of the following conditions:



     SECTION 4.01. Conditions Precedent to Closing Date. On the Closing Date:




     (a) The Administrative Agent shall have received, on behalf of itself and the Lenders a
favorable written opinion of (i) Kirkland & Ellis LLP, counsel for the Borrower and the
Subsidiaries, in form and substance reasonably satisfactory to the Arrangers and their
counsel and (ii) each special and local counsel to the Borrower and the Subsidiaries as the
Arrangers may reasonably request, in each case (A) dated the Closing Date, (B) addressed to
the Arrangers, the Administrative Agent, the Collateral Agent, and the Lenders and (C)
covering such matters relating to the Loan Documents and the Transactions as the Arrangers
shall reasonably request and which are customary for transactions of the type contemplated
herein.



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     (b) The Administrative Agent shall have received (i) a copy of the certificate or
articles of incorporation or other formation documents, including all amendments thereto, of
the Borrower, certified as of a recent date by the Secretary of State of the state of its
organization, and a certificate as to the good standing as of a recent date, from such
Secretary of State; (ii) a certificate of the Secretary or Assistant Secretary of the
Borrower dated the Closing Date and certifying (A) that attached thereto is a true and
complete copy of the by-laws of the Borrower as in effect on the Closing Date and at all
times since a date prior to the date of the resolutions described in clause (B) below, (B)
with respect to the Borrower, that attached thereto is a true and complete copy of
resolutions duly adopted by the Board of Directors of the Borrower authorizing the
execution, delivery and performance of the Loan Documents to which the Borrower is a party
and the borrowings hereunder, and that such resolutions have not been modified, rescinded or
amended and are in full force and effect, (C) that the certificate or articles of
incorporation or other formation documents of the Borrower has not been amended since the
date of the last amendment thereto shown on the certificate of good standing furnished
pursuant to clause (i) above and (D) with respect to the Borrower, as to the incumbency and
specimen signature of each officer executing any Loan Document or any other document
delivered in connection herewith on behalf of the Borrower; (iii) a certificate of another
officer as to the incumbency and specimen signature of the Secretary or Assistant Secretary
executing the certificate pursuant to (ii) above; and (iv) if requested, documentation and
other information required by bank regulatory
authorities under applicable “know your customer” and anti-money laundering rules and
regulations, including the USA Patriot Act (title III of Pub. L. 107-56 (signed into law
October 26, 2001)).



     (c) The Administrative Agent shall have received (i) this Agreement, executed and
delivered by a duly authorized officer of the Borrower, (ii) if requested by any Lender
pursuant to Section 2.04, a promissory note or notes conforming to the requirements of such
Section and executed and delivered by a duly authorized officer of the Borrower, and (iii) a
Lender Addendum executed and delivered by each Lender and accepted by the Borrower.



     (d) The Borrower shall have paid all fees and reasonable, documented out-of-pocket
costs and expenses (including reasonable legal fees and expenses of Latham & Watkins LLP,
counsel to the Arrangers, and any special regulatory counsel) and their technical and other
non-financial advisors, title premiums, survey charges and recording taxes and fees) and
other compensation accrued and payable as of such date to the Arrangers, the Administrative
Agent or the Lenders as separately agreed by the Borrower and the Arrangers.



     (e) The Arrangers shall have received the financial statements required on or prior to
the Closing Date pursuant to Section 3.05 all in form and substance reasonably satisfactory
to the Arrangers.



     (f) The Arrangers shall have received the results of a recent Lien and judgment search
in each relevant jurisdiction with respect to the Borrower and such search shall reveal no
Liens on any of the assets of the Borrower except, in the case of Collateral other than
Pledged Securities, for Permitted Liens, and in respect of Pledged Securities, the Permitted
Liens in clause (h) of the definition thereof and except for Liens to be discharged on or
prior to the Closing Date pursuant to documentation reasonably satisfactory to the Arrangers
or such other Liens that are not discharged with the consent of the Administrative Agent, as
such consent may be provided in the Administrative Agent’s reasonable judgment.



     (g) The Borrower shall have furnished to the Administrative Agent, for distribution to
each Lender, a detailed consolidated budget for each fiscal year through 2012 (including a



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projected consolidated balance sheet and related statements of projected operations and cash
flows as of the end of and for such fiscal year and setting forth the assumptions used for
purposes of preparing such budget).



     SECTION 4.02. Conditions Precedent to Funding Date. On the Funding Date:




     (a) The Administrative Agent shall have received a notice of such Borrowing as required
by Section 2.03.




     (b) The representations and warranties set forth in each Loan Document shall be true
and correct in all material respects on and as of the Funding Date with the same effect as
though made on and as of such date, except to the extent such representations and warranties
expressly relate to an earlier date, in which case such representations and warranties shall
be true and correct in all material respects on and as of such earlier date.




     (c) At the time of and immediately after the Funding Date, no Event of Default or
Default shall have occurred and be continuing.




     (d) The Arrangers shall have received a solvency certificate from a Financial Officer
of the Borrower, in form and substance reasonably satisfactory to each Arranger, supporting
the conclusions that after giving effect to the Transactions, the Borrower and the
Subsidiaries, taken as a whole, will not be insolvent or be rendered insolvent by the
Indebtedness incurred in connection therewith, or be left with unreasonably small capital
with which to engage in its businesses, or have incurred debts beyond its ability to pay
such debts as they mature.




     (e) The Administrative Agent shall have received a certificate, dated the Funding Date
and signed by a Financial Officer of the Borrower, confirming compliance with the conditions
precedent set forth in paragraphs (b) and (c) of this Section.




     (f) The Administrative Agent shall have received a true and complete copy of
resolutions duly adopted by the Capital Allocation Committee authorizing the execution,
delivery and performance of the Loan Documents to which the Borrower is a party and the
borrowings hereunder.




     (g) The Administrative Agent shall have received, on behalf of itself and the Lenders a
favorable written opinion of (i) Kirkland & Ellis LLP, counsel for the Borrower and the
Subsidiaries, in form and substance reasonably satisfactory to the Arrangers and their
counsel and (ii) each special and local counsel to the Borrower and the Subsidiaries
(including special regulatory counsel) as the Arrangers may reasonably request, in each case
(A) dated as of the Funding Date, (B) addressed to the Arrangers, the Administrative Agent,
the Collateral Agent, and the Lenders and (C) covering such matters relating to the Loan
Documents and the Transactions as the Arrangers shall reasonably request and which are
customary for transactions of the type contemplated herein.




     (h) The Administrative Agent shall have received the Collateral Agreement, executed and
delivered by a duly authorized officer of the Borrower.




     (i) The Holdings Reorganization shall have been consummated, or shall be consummated
concurrently with the funding of the Term Loans, pursuant to the terms of the documentation
relating thereto which shall be in form and substance reasonably satisfactory to the
Administrative Agent.



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     (j) The Borrower shall have paid all fees and reasonable, documented out-of-pocket
costs and expenses (including reasonable legal fees and expenses of Latham & Watkins LLP,
counsel to the Arrangers, and one local counsel to the Arrangers per relevant jurisdiction
(it being understood that such limitation does not apply to special regulatory counsel) and
their technical and other non-financial advisors, title premiums, survey charges and
recording taxes and fees (if any)) and other compensation accrued and payable as of such
date to the Arrangers, the Administrative Agent or the Lenders as separately agreed by the
Borrower and the Arrangers.




     (k) The Collateral Agent, for the ratable benefit of the Secured Parties, shall have
been granted on the Funding Date, to the extent described in Section 3.19, first priority
perfected (subject to the limitations set forth in Section 3.19) Liens on the Collateral
(subject, in the case of all Collateral other than Pledged Securities, only to Permitted
Liens and in the case of Pledged Securities, the Permitted Liens in clause (h) of the
definition thereof) and shall have received such other reports, documents and agreements as
the Collateral Agent shall reasonably request. The Pledged Securities shall have been duly
and validly pledged under the Collateral Agreement to the Collateral Agent, for the ratable
benefit of the Secured Parties, and certificates representing
such Pledged Securities, accompanied by instruments of transfer and stock powers
endorsed in blank, shall be in the actual possession of the Collateral Agent.




     (l) All material governmental, shareholder and third-party approvals and all material
consents necessary for the Transactions (including (i) the approval of FERC under Section
203 of the Federal Power Act as may be required for the Holdings Reorganization, (ii) the
approval of, or finding that no approval is required by, the NYPSC, as may be required for
the Transactions, and (iii) the consent of the Nuclear Regulatory Commission pursuant to
Section 184 of the Atomic Energy Act of 1954 and 10 C.F.R. § 50.80 in connection with the
Transactions) shall have been received and shall be in full force and effect, and all
applicable waiting periods shall have expired without any materially adverse action being
taken by any applicable authority.




     (m) The Arrangers shall have received the results of a bring-down Lien and judgment
search in each relevant jurisdiction with respect to the Borrower and such search shall
reveal no Liens on any of the Collateral except, in the case of Collateral other than
Pledged Securities, for Permitted Liens and in the case of Pledged Securities, the Permitted
Liens in clause (h) of the definition thereof.




     (n) The Collateral Agent shall have received a duly executed Perfection Certificate
dated on prior to the Funding Date.



     The obligations of the Lenders to make Term Loans hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived pursuant to Section 9.08). For the
avoidance of doubt, the Borrower shall be under no obligation to draw Term Loans on any date,
including the Funding Date (if any).



ARTICLE V.




Affirmative Covenants




     The Borrower covenants and agrees with each Lender that so long as this Agreement shall remain
in effect and until the Term Loan Commitments have been terminated and the principal of and
interest on each Term Loan, all Fees and all other expenses or amounts payable under any Loan
Document (other than indemnification and other contingent obligations in each case not then due and
payable) shall have



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been paid in full, the Borrower will, and will cause the Company each of its
and the Company’s Subsidiaries to:




     SECTION 5.01. Corporate Existence. Subject to Section 6.04 hereof, and only with respect to the
Borrower, the Company and the other Restricted Subsidiaries, do or cause to be done all things
necessary to preserve and keep in full force and effect (a) its corporate existence, and the
corporate, partnership or other existence of the Company each of their subsidiaries, in accordance
with the respective organizational documents (as the same may be amended from time to time) of the
Borrower, the Company or any such subsidiary; and (b) the rights (charter and statutory), licenses
and franchises of the Borrower, the Company and their Subsidiaries, except where the failure to so
preserve and keep could not reasonably be expected to result in a Material Adverse Effect;
provided, however, that neither the Borrower, the Company nor any other Restricted
Subsidiary shall be required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any of its subsidiaries, if the Borrower, the Company or such
other Restricted Subsidiary shall determine that the preservation thereof is no longer desirable in
the conduct of the
business of the Borrower, the Company and their Subsidiaries, taken as a whole, and that the
loss thereof could not reasonably be expected to result in a Material Adverse Effect.



     SECTION 5.02. Insurance. Except to the extent any such insurance is not generally available in
the marketplace from commercial insurers, keep its properties that are of an insurable character
adequately insured in accordance with industry standards at all times by financially sound insurers
(provided, however, that there shall be no breach of this Section 5.02 if any such
insurer becomes financially unsound and the Borrower, the Company or any of their Subsidiaries
obtains reasonably promptly insurance coverage from a different financially sound insurer);
maintain such other insurance, to such extent and against such risks (and with such deductibles,
retentions and exclusions), in each case as is customary with companies of a similar size operating
in the same or similar businesses; maintain such other insurance as may be required by law; and
maintain such other insurance as otherwise required by the Security Documents.



     SECTION 5.03. Taxes. Pay, and cause each of the Company and the Borrower’s and the Company’s
Subsidiaries to pay, prior to delinquency, all material Taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings and where the Borrower or
the Company or the relevant Subsidiary shall have set aside on its books adequate reserves with
respect thereto in accordance with GAAP and such contest operates to suspend collection of the
contested obligation, tax, assessment or charge and enforcement of a Lien.



     SECTION 5.04. Financial Statements, Reports, etc. In the case of the Borrower, furnish to the
Administrative Agent for distribution to each Lender:




     (a) within 90 days after the end of each fiscal year (beginning within 90 days after
the end of fiscal year 2007), its consolidated balance sheet and related statements of
income, stockholders’ equity and cash flows showing the financial condition as of the close
of such fiscal year of the Borrower and its consolidated Subsidiaries at such time and the
results of its operations and the operations of such Subsidiaries during such year, together
with comparative figures for the immediately preceding fiscal year, all audited by KPMG LLP
or other independent public accountants of recognized national standing and accompanied by
an opinion of such accountants reasonably satisfactory to the Administrative Agent (which
shall not be qualified in any material respect, except for qualifications relating to
accounting changes (with which such independent public accountants shall concur) in response
to FASB releases or other authoritative pronouncements) to the effect that such consolidated
financial statements fairly present the



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financial condition and results of operations of the
Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied;




     (b) within 45 days after the end of each of the first three fiscal quarters of each
fiscal year, its unaudited consolidated balance sheet and related statements of income,
stockholders’ equity and cash flows showing the financial condition as of the close of such
fiscal quarter of the Borrower and its consolidated Subsidiaries at such time and the
results of its operations and the operations of such Subsidiaries during such fiscal quarter
and the then elapsed portion of the fiscal year, and comparative figures for the same
periods in the immediately preceding fiscal year, all certified by one of its Financial
Officers to the effect that such financial statements, while not examined by independent
public accountants, reflect in the opinion of the Borrower all adjustments necessary to
present fairly in all material respects the financial condition and results
of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis
as of the end of and for such periods in accordance with GAAP consistently applied, subject
to normal year-end audit adjustments and the absence of footnotes (it being understood that
prior to the Funding Date the requirements under this paragraph (b) shall be satisfied if
the Borrower delivers the financial statements required to be delivered by Section 5.04(b)
of the Opco Credit Agreement);



     (c) concurrently with any delivery of financial statements under paragraph (a) above
for the year ended December 31, 2007 and each year thereafter, a letter from the accounting
firm rendering the opinion on such statements (which letter may be limited to accounting
matters and disclaim responsibility for legal interpretations) stating whether, in
connection with their audit examination, anything has come to their attention which would
cause them to believe that any Default or Event of Default existed on the date of such
financial statements and if such a condition or event has come to their attention and (ii)
concurrently with any delivery of financial statements under paragraph (a) or (b) above, a
certificate of a Financial Officer of the Borrower (A) certifying that no Event of Default
or Default has occurred or, if such an Event of Default or Default has occurred, specifying
the nature and extent thereof and any corrective action taken or proposed to be taken with
respect thereto, (B) in the case of a certificate delivered with the financial statements
required by paragraph (a) above, setting forth the Borrower’s calculation of Excess Cash
Flow for the applicable fiscal year and the Available Amount as at the end of the applicable
fiscal year and (C) disclosing any Holdings Asset Sale or Holdings Recovery Event (other
than any Holdings Asset Sale or Holdings Recovery Event not subject to the mandatory
prepayment provisions set forth in Section 2.13(b) pursuant to the first proviso of the
definition of Net Cash Proceeds) that was consummated in the preceding fiscal quarter and
specifying the nature thereof and the use of proceeds with respect thereto;



     (d) promptly after the same become publicly available, copies of all periodic and other
reports, proxy statements and other materials filed by the Borrower, the Company or any of
their Subsidiaries with the Securities and Exchange Commission, or any Governmental
Authority succeeding to any or all of the functions of said Commission, or with any domestic
national securities exchange, or distributed to its shareholders generally, as the case may
be;



     (e) promptly after the receipt thereof by the Borrower, the Company or any of their
Subsidiaries, a copy of any “management letter” received by any such Person from its
certified public accountants and the management’s response thereto; and



     (f) promptly, from time to time, such other information regarding the operations,
business affairs and financial condition of the Borrower, the Company or any of their



75









 






Subsidiaries, or compliance with the terms of any Loan Document, as the Administrative Agent
or any Lender (acting through the Administrative Agent) may reasonably request.



     SECTION 5.05. Litigation and Other Notices. Furnish to the Administrative Agent written notice of
the following promptly after the Borrower obtains knowledge thereof:




     (a) any Event of Default or Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;




     (b) the filing or commencement of any action, suit or proceeding, whether at law or in
equity or by or before any arbitrator or Governmental Authority, against the Borrower, the
Company or any of their Subsidiaries that could reasonably be expected to result in a
Material Adverse Effect;




     (c) the occurrence of any ERISA Event that could reasonably be expected to result in a
Material Adverse Effect; and




     (d) any development that has resulted in, or could reasonably be expected to result in,
a Material Adverse Effect.



     SECTION 5.06. Information Regarding Collateral. (a) Furnish to each of the Administrative
Agent and the Collateral Agent prompt written notice of (i) any change (A) in the Borrower’s
corporate name as set forth in its certificate of incorporation, certificate of formation or other
relevant organizational documents, (B) any office or facility (other than any location within the
control of the Administrative Agent or the Collateral Agent) at which material portions of
Collateral owned by it is located (including the establishment of any such new office or facility),
(C) in the Borrower’s corporate structure or (D) in the Borrower’s Federal Taxpayer Identification
Number; (ii) any formation or acquisition after the Closing Date of any Subsidiary of the Borrower
or the Company that is not an Excluded Subsidiary; and (iii) any sale, transfer, lease, issuance or
other disposition (by way of merger, consolidation, operation of law or otherwise) after the
Closing Date of any Equity Interests of any Subsidiary of the Borrower or the Company that is not
an Excluded Subsidiary to any Person other than the Borrower or another Subsidiary of the Borrower
or the Company. The Borrower agrees not to effect or permit any change referred to in the
preceding sentence unless a reasonable period has been provided (such period to be at least 3
Business Days) for making all filings under the UCC or otherwise and taking all other actions, in
each case that are required in order for the Collateral Agent to continue at all times following
such change to have a valid, legal and perfected (subject to the limitations set forth in Section
3.19) security interest in all the Collateral (other than any Excluded Perfection Assets). The
Borrower also agrees promptly to notify each of the Administrative Agent and the Collateral Agent
if any material portion of the Collateral is damaged or destroyed.



     (b) In the case of the Borrower, each year, at the time of delivery of the annual financial
statements with respect to the preceding fiscal year pursuant to Section 5.04(a), deliver to the
Administrative Agent a certificate of a Financial Officer of the Borrower setting forth (i) the
information required pursuant to Section I of the Perfection Certificate or confirming that there
has been no change in such information since the date of the Perfection Certificate delivered on
the Funding Date or the date of the most recent certificate delivered pursuant to this Section and
(ii) any liquidation or dissolution during such preceding fiscal year of any Subsidiary of the
Borrower or the Company that is not an Excluded Subsidiary.



     SECTION 5.07. Maintaining Records; Access to Properties and Inspections. (a) Keep, and cause
the Company and each Subsidiary of the Borrower and the Company to keep, proper books of



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record and
account in which full, true and correct entries in conformity with GAAP and all applicable
requirements of law are made of all financial operations. No more than once in any fiscal year
(except if an Event of Default has occurred and is continuing) the Borrower will, and will cause
the Company and each of the Borrower’s and the Company’s Subsidiaries to, permit, if requested by
the Administrative Agent, any representatives designated by the Administrative Agent or any Lender
to visit and inspect the financial records and the properties of the Borrower, the Company or any
of their Subsidiaries at reasonable times and as reasonably requested and to make extracts from and
copies of such financial records, and permit any representatives designated by the Administrative
Agent
or any Lender to discuss the affairs, finances and condition of the Borrower, the Company or
any of their Subsidiaries with the officers thereof and independent accountants therefor.




     (b) At its election, the Administrative Agent may retain, or require the Borrower to retain,
an independent engineer or environmental consultant to conduct an environmental assessment of any
Mortgaged Property or facility of the Borrower, the Company or any of their Subsidiaries. Any such
environmental assessments conducted pursuant to this paragraph (b) shall be at the Borrower’s sole
cost and expense only if conducted following the occurrence of (i) an Event of Default or (ii) any
event, circumstance or condition that could reasonably be expected to result in an Event of
Default, in the case of each of clause (i) and (ii) that concerns or relates to any Environmental
Liabilities of the Borrower, the Company or any of their Subsidiaries; provided that the
Borrower shall only be responsible for such costs and expenses to the extent that such
environmental assessment is limited to that which is reasonably necessary to assess the subject
matter of such Event of Default or such event, circumstance or condition that could reasonably be
expected to result in an Event of Default. In addition, environmental assessments conducted
pursuant to this paragraph (b) shall not be conducted more than once every twelve months with
respect to any parcel of Mortgaged Property or any single facility of the Borrower, the Company or
any of their Subsidiaries unless such environmental assessments are conducted following the
occurrence of (i) an Event of Default or (ii) any event, circumstance or condition that could
reasonably be expected to result in an Event of Default, in the case of each of clause (i) and (ii)
that concerns or relates to any Environmental Liabilities of the Borrower, the Company or any of
their Subsidiaries. The Borrower shall, and shall cause the Company and each of the Borrower’s and
the Company’s Subsidiaries to, reasonably cooperate in the performance of any such environmental
assessment and permit any such engineer or consultant designated by the Administrative Agent to
have reasonable access to each property or facility at reasonable times and after reasonable notice
to the Borrower of the plans to conduct such an environmental assessment. Environmental
assessments conducted under this paragraph (b) shall be limited to visual inspections of the
Mortgaged Property or facility, interviews with representatives of the Borrower or facility
personnel, and review of applicable records and documents pertaining to the property or facility.



     (c) In the event that the Administrative Agent reasonably believes that Hazardous Materials
have been Released or are threatened to be Released on any Mortgaged Property or other facility of
the Borrower, the Company or any of their Subsidiaries or that any such property or facility is not
being operated in compliance with applicable Environmental Law, in each case where the Release,
threatened Release or failure to comply has resulted in, or could reasonably be expected to result
in, a material Environmental Liability of the Borrower, the Company or any of their Subsidiaries,
the Administrative Agent may, at its election and after reasonable notice to the Borrower, retain,
or require the Borrower to retain, an independent engineer or other qualified environmental
consultant to reasonably assess the subject matter of such Release, threatened Release or failure
to comply with applicable Environmental Law. Such environmental assessments may include detailed
visual inspections of the Mortgaged Property or facility, including any and all storage areas,
storage tanks, drains, dry wells and leaching areas, and the taking of soil samples, surface water
samples and groundwater samples as well as such other reasonable investigations or analyses in each
case as are reasonable and necessary to assess the subject matter of the Release, threatened
Release or failure to comply. The Borrower shall, and shall cause the Company and



77









 




each of the
Borrower’s and the Company’s Subsidiaries to, reasonably cooperate in the performance of any such
environmental assessment and permit any such engineer or consultant designated by the
Administrative Agent to have reasonable access to each property or facility at reasonable times and
after reasonable notice to the Borrower of the plans to conduct such an environmental assessment.
All environmental assessments conducted pursuant to this paragraph (c) shall be at the Borrower’s
sole cost and expense.




     SECTION 5.08. Use of Proceeds. Use the proceeds of the Term Loans only for the purposes set forth in Section 3.13.



     SECTION 5.09. Additional Collateral, etc. (a) With respect to any Collateral acquired after
the Funding Date or, in the case of inventory or equipment that is part of the Collateral, any
material Collateral (other than Collateral in possession of the Administrative Agent or the
Collateral Agent) moved after the Closing Date by the Borrower (other than any Collateral described
in paragraphs (b), (c) or (d) of this Section) as to which the Collateral Agent, for the benefit of
the Secured Parties, does not have a perfected security interest, promptly (and, in any event,
within 20 Business Days following the date of such acquisition or designation) (i) execute and
deliver to the Administrative Agent, and the Collateral Agent such amendments to the Collateral
Agreement or such other Security Documents as the Collateral Agent deems necessary or reasonably
advisable to grant to such Collateral Agent, for the benefit of the Secured Parties, a security
interest in such Collateral and (ii) take all actions necessary or reasonably requested by the
Administrative Agent to grant to the Collateral Agent, for the benefit of the Secured Parties, a
perfected (subject to the limitations set forth in Section 3.19) first priority security interest
in such Collateral (other than any Excluded Perfection Assets and, except with respect to Pledged
Securities, subject to Permitted Liens, and in respect of Pledged Securities, the Permitted Liens
set forth in clause (h) of the definition thereof), including the filing of UCC financing
statements in such jurisdictions as may be required by the Collateral Agreement or by law or as may
be reasonably requested by the Administrative Agent or the Collateral Agent.



     (b) With respect to any fee interest in any Collateral consisting of real property or any
lease of Collateral consisting of real property acquired or leased after the Funding Date by the
Borrower (other than any Excluded Perfection Assets), promptly (and, in any event, within 60 days
following the date of such acquisition) (i) execute and deliver a first priority Mortgage in favor
of the Collateral Agent, for the benefit of the Secured Parties, covering such real property and in
form and substance reasonably satisfactory to the Collateral Agent, (ii) provide the Secured
Parties with (A) title and extended coverage insurance covering such real property in an amount at
least equal to the purchase price of such real property (or such other amount as shall be
reasonably specified by the Administrative Agent or the Collateral Agent, which may be the value of
the generation assets, if applicable, situated thereon), together with such endorsements as are
reasonably required by the Administrative Agent or the Collateral Agent and are obtainable in the
State in which such real property is located, as well as a current ALTA survey thereof complying
with the requirements set forth in Schedule 5.09(b) and all of the other provisions herein and in
the Security Documents, together with a surveyor’s certificate and (B) any consents or estoppels
reasonably deemed necessary or advisable by the Administrative Agent or the Collateral Agent in
connection with such Mortgage, each of the foregoing in form and substance reasonably satisfactory
to the Administrative Agent and the Collateral Agent, (iii) if reasonably requested by the
Administrative Agent, deliver to the Administrative Agent and the Collateral Agent legal opinions
relating to the matters described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent and the Collateral Agent and (iv)
deliver to the Administrative Agent a notice identifying the consultant’s reports, environmental
site assessments or other documents relied upon by the Borrower to determine that any such real
property included in such Collateral does not contain Hazardous Materials of a form or type or in a
quantity or location that could, or to determine that the operations on any such real property
included in such Collateral is in compliance



78









 




with Environmental Law except to the extent any
non-compliance could not, reasonably be expected to result in a material Environmental Liability.




     (c) With respect to any new Subsidiary (other than an Unrestricted Subsidiary or a subsidiary
of the Company) created or acquired after the Funding Date by (and directly owned by) the Borrower,
promptly (and, in any event, within 20 days following such creation or the date of such
acquisition), (i)
execute and deliver to the Administrative Agent and the Collateral Agent such amendments to
the Collateral Agreement as the Administrative Agent or the Collateral Agent deems necessary or
reasonably advisable to grant to the Collateral Agent, for the benefit of the Secured Parties, a
valid, perfected first priority security interest in the Equity Interests in such new Subsidiary
that are owned by the Borrower, (ii) deliver to the Collateral Agent the certificates, if any,
representing such Equity Interests, together with undated instruments of transfer or stock powers,
in blank, executed and delivered by a duly authorized officer of the Borrower, and (iii) deliver to
the Administrative Agent and the Collateral Agent, if reasonably requested, legal opinions relating
to the matters described above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent and the Collateral Agent.



     (d) With respect to any new Foreign Subsidiary (other than an Unrestricted Subsidiary or a
subsidiary of the Company) created or acquired after the Funding Date by (and directly owned by)
the Borrower, promptly (and, in any event, within 25 days following such creation or the date of
such acquisition), (i) execute and deliver to the Administrative Agent and the Collateral Agent
such amendments to the Collateral Agreement as the Administrative Agent or the Collateral Agent
deems necessary or advisable in order to grant to the Collateral Agent, for the benefit of the
Secured Parties, a perfected first priority security interest in the Equity Interests in such new
Foreign Subsidiary that is directly owned by the Borrower (provided that in no event shall
more than 66% of the total outstanding voting first-tier Equity Interests in any such new Foreign
Subsidiary be required to be so pledged), (ii) deliver to the Collateral Agent the certificates
representing such Equity Interests, together with undated instruments of transfer or stock powers,
in blank, executed and delivered by a duly authorized officer of the Borrower and take such other
action as may be necessary or, in the reasonable opinion of the Administrative Agent or the
Collateral Agent, desirable to perfect the security interest of the Collateral Agent thereon and
(iii) deliver to the Administrative Agent and the Collateral Agent, if reasonably requested, legal
opinions (which may be delivered by in-house counsel if admitted in the relevant jurisdiction)
relating to the matters described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent and the Collateral Agent.



     SECTION 5.10. Further Assurances. (a) From time to time duly authorize, execute and deliver,
or cause to be duly authorized, executed and delivered, such additional instruments, certificates,
financing statements, agreements or documents, and take all such actions (including filing UCC and
other financing statements), as the Administrative Agent and the Collateral Agent may reasonably
request, for the purposes of implementing or effectuating the provisions of this Agreement and the
other Loan Documents, or perfecting or renewing the rights of the Administrative Agent, the
Collateral Agent and the Secured Parties with respect to the Collateral (or with respect to any
additions thereto or replacements or proceeds or products thereof or with respect to any other
property or assets hereafter acquired by the Borrower which assets or property may be deemed to be
part of the Collateral) pursuant hereto or thereto. Upon the exercise by the Administrative Agent,
the Collateral Agent or any Lender of any power, right, privilege or remedy pursuant to this
Agreement or the other Loan Documents which requires any consent, approval, recording,
qualification or authorization of any Governmental Authority, the Borrower will execute and
deliver, or will cause the execution and delivery of, all applications, certifications, instruments
and other documents and papers that the Administrative Agent, the Collateral Agent or such



79









 




Lender
may be required to obtain from the Borrower for such governmental consent, approval, recording,
qualification or authorization.




     SECTION 5.11. Change of Control. At any time after the Holdings Reorganization shall have occurred, the Borrower shall
at all times be the Beneficial Owner of all of the Capital Stock of the Company.



ARTICLE VI.




Negative Covenants




     The Borrower covenants and agrees with each Lender that, so long as this Agreement shall
remain in effect and until the Term Loan Commitments have been terminated and the principal of and
interest on each Term Loan, all Fees and all other expenses or amounts payable under any Loan
Document (other than indemnification and other contingent obligations in each case not then due and
payable) shall have been paid in full, the Borrower will not, nor will it cause or permit the
Company or any of the other Restricted Subsidiaries to:



     SECTION 6.01. Indebtedness and Preferred Stock. Directly or indirectly, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, “incur”) any Indebtedness, and the Borrower will not issue
any Disqualified Stock and will not permit the Company or the other Restricted Subsidiaries to
issue any shares of preferred stock except for:



     (a) (i) the incurrence by the Borrower of the Indebtedness created under the Loan Documents
and (ii) the incurrence by the Company (and the Guarantee thereof by the Opco Subsidiary
Guarantors) of the Indebtedness created (and the reimbursement obligations with respect to letters
of credit issued) under the Opco Credit Agreement and the other Opco Loan Documents and any
Revolver Refinancing Indebtedness; provided that the net cash proceeds of any Indebtedness incurred
under clause (a)(ii) in excess of $6,000,000,000 shall be distributed by the Company to the
Borrower and used by the Borrower to repay Term Loans hereunder, in each case, no later than the
fifth Business Day following the receipt thereof;



     (b) the incurrence by the Company and its Restricted Subsidiaries of the Existing
Indebtedness;



     (c) the incurrence by any Opco Loan Party of Indebtedness represented by the Senior Notes
issued on or prior to the Closing Date and the related Guarantees of the Opco Subsidiary Guarantors
thereof, and at the sole discretion of the Borrower, the Guarantee by the Borrower of any such
Indebtedness;



     (d) the incurrence by the Borrower or any of its Restricted Subsidiaries of Indebtedness
represented by Attributable Debt, Capital Lease Obligations, mortgage financings or purchase money
obligations, in each case, incurred for the purpose of financing all or any part of the purchase
price or cost of design, construction, installation or improvement or lease of property (real or
personal), plant or equipment used in the business of the Borrower or any of its Restricted
Subsidiaries or incurred within 270 days after any of the foregoing, in an aggregate principal
amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance, replace,
defease or discharge any Indebtedness incurred pursuant to this clause (d), not to exceed
$475,000,000 at any time outstanding;



80









 





     (e) the incurrence by the Borrower or any of its Restricted Subsidiaries of Permitted
Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund,
refinance, replace, defease or discharge Indebtedness (other than intercompany Indebtedness) that
was permitted by
this Agreement to be incurred under clauses (b), (c), (d), (e), (m), clause (B) of clause (p),
(q), (r) or (s) of this Section 6.01;



     (f) the incurrence by the Borrower and the Restricted Subsidiaries of unsecured intercompany
Indebtedness; provided, however, that (A) if the Borrower is the obligor on such
Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash
of all obligations hereunder (which subordination may be pursuant to an Affiliate Subordination
Agreement or any other agreement containing terms with respect to the subordination of the
obligations thereunder that are substantially the same as the Affiliate Subordination Agreement or
are otherwise reasonably acceptable to the Administrative Agent, in each case, executed and
delivered by both the applicable borrower and lender); and (B)(x) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness being held by a Person other
than the Borrower or a Restricted Subsidiary and (y) any sale or other transfer of any such
Indebtedness to a Person that is not either the Borrower or a Restricted Subsidiary will be deemed,
in each case, to constitute an incurrence of such Indebtedness by the Borrower or such Restricted
Subsidiary, as the case may be, that was not permitted by this clause (f);



     (g) the issuance by any Opco Restricted Subsidiary to the Company or to any of its other Opco
Restricted Subsidiaries, or to the Borrower of shares of preferred stock; provided,
however, that (i) any subsequent issuance or transfer of Equity Interests that results in
any such preferred stock being held by a Person other than the Company or an Opco Restricted
Subsidiary or the Borrower and (ii) any sale or other transfer of any such preferred stock to a
Person that is not either the Company or an Opco Restricted Subsidiary or the Borrower will be
deemed, in each case, to constitute an issuance of such preferred stock by such Restricted
Subsidiary that was not permitted by this clause (g);



     (h) the incurrence by the Company or any of its Restricted Subsidiaries of Commodity Hedging
Obligations, Eligible Commodity Hedging Obligations and Interest Rate/Currency Hedging Obligations,
and the incurrence by the Borrower of Interest Rate/Currency Hedging Obligations of the type
described in clause (a) or (b) of the definition thereof;



     (i) the Guarantee by (i) any Opco Loan Party of Indebtedness of the Company or any of its
Restricted Subsidiaries that was permitted to be incurred by another provision of this Section 6.01
(other than clause (m) and (w)); (ii) any of the Excluded Project Subsidiaries of Indebtedness of
any other Excluded Project Subsidiary; (iii) any of the Excluded Foreign Subsidiaries of
Indebtedness of any other Excluded Foreign Subsidiary; and (iv) the Company of Permitted Itiquira
Indebtedness; provided that such Guarantee of Permitted Itiquira Indebtedness matures or
otherwise terminates within one year of the incurrence thereof;



     (j) the incurrence by the Borrower or any of the Restricted Subsidiaries of Indebtedness
arising from the honoring by a bank or other financial institution of a check, draft or similar
instrument (except in the case of daylight overdrafts) inadvertently drawn against insufficient
funds, so long as such Indebtedness is covered within five Business Days;



     (k) [Reserved];



     (l) the incurrence by the Borrower or any of its Restricted Subsidiaries of Indebtedness in
respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptance and
performance and surety bonds provided by the Borrower or such Restricted Subsidiary in the ordinary
course of business;



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     (m) the incurrence of Additional Non-Recourse Indebtedness by any Excluded Project Subsidiary;



     (n) the incurrence of Indebtedness that may be deemed to arise as a result of agreements of
the Borrower or any Restricted Subsidiary providing for indemnification, adjustment of purchase
price or any similar obligations, in each case, incurred in connection with the acquisition or
disposition of any business, assets or Equity Interests of any Subsidiary or any business, assets
or Equity Interests acquired by the Borrower or any Restricted Subsidiary; provided that in
the case of any such disposition the aggregate maximum liability associated with such provisions
may not exceed the gross proceeds (including non-cash proceeds) of such disposition;



     (o) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness
represented by letters of credit, guarantees of Indebtedness or other similar instruments to the
extent (A) such instruments, including instruments supporting Commodity Hedging Obligations or
Interest Rate/Currency Hedging Obligations, are cash collateralized and (B) the Company or such
Restricted Subsidiary would not have been prohibited from expending the funds used to cash
collateralize such instrument directly under the terms of this Agreement;



     (p) the incurrence by the Company and/or any of its Restricted Subsidiaries of (A) additional
Indebtedness if (1) such Indebtedness does not mature, and is not subject to mandatory repurchase,
redemption or amortization (other than pursuant to customary asset sale or change of control
provisions requiring redemption or repurchase only if and to the extent permitted by this Agreement
and other than amortization payments of up to 1% of the initial principal amount per annum) prior
to the date that is six months after the Term Loan Maturity Date, provided, however, that the
restrictions in this Section 6.01(p)(A)(1) shall not apply to any Indebtedness in the form of
letters of credit and any Indebtedness that is secured by any assets of the Company or any of its
Restricted Subsidiaries, (2) no Default or Event of Default exists immediately prior to, or would
exist immediately after giving effect to, the incurrence of such Indebtedness, (3) the Consolidated
Leverage Ratio for the Company’s most recently ended Test Period for which financial statements are
publicly available immediately preceding the date on which such additional Indebtedness is incurred
would have been no more than 6.50 to 1.00 (or, at any time after December 31, 2007, 6.25 to 1.00),
determined on a pro forma basis (including a pro forma application of the net proceeds therefrom),
as if such additional Indebtedness (and any other Indebtedness incurred during such Test Period or
from the end of such Test Period through the date on which such calculation is made) had been
incurred at the beginning of the applicable Test Period and was outstanding on such calculation
date and (4) the Consolidated Interest Coverage Ratio of the Company for the Company’s most
recently ended Test Period for which financial statements are publicly available immediately
preceding the date on which such additional Indebtedness is incurred would have been at least 1.75
to 1.0, determined on a pro forma basis (including a pro forma application of the net proceeds
therefrom), as if such additional Indebtedness (and any other Indebtedness incurred during such
Test Period or from the end of such Test Period through the date on which such calculation is made)
had been incurred at the beginning of the applicable Test Period and (B) additional Indebtedness in
an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including
all Permitted Refinancing Indebtedness incurred to refund, refinance, replace, defease or discharge
any Indebtedness incurred pursuant to this clause (p)(B), not to exceed $300,000,000;
provided that in the case of any incurrence of any Indebtedness pursuant to this clause
(p), (x) the Company shall be in compliance as of the date of such incurrence, on a pro forma basis
after giving effect to the incurrence of such Indebtedness, with the covenants set forth in
Sections 6.13 and 6.14 of the Opco Credit Agreement (as such covenants shall exist on the date
hereof, but for the avoidance of doubt based on the applicable ratio set forth in such covenants on
the date hereof that shall apply at such time), as if such Indebtedness (and any other Indebtedness
incurred during such Test Period or from the end of such Test Period through the date such
calculation is made) had been incurred on the first day of the applicable Test Period; and (y) no
more than the greater of



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(1) $720,000,000 and (2) an amount equal to the Consolidated EBITDA of the
Company for the period of four consecutive fiscal quarters most recently ended on or prior to the
date on which such Indebtedness is incurred multiplied by 30% (less, in the case of each of clause
(1) and clause (2), the aggregate principal
amount of any additional loans or commitments obtained pursuant to Section 2.25 of the Opco
Credit Agreement or any similar section of the Opco Credit Agreement in which pre-approved and/or
incremental commitments and loans which were not committed or made on the Closing Date are
committed or made by lenders thereunder after the Closing Date) in aggregate principal amount of
Indebtedness incurred pursuant to this clause (p) may be secured by first priority and/or second
priority Liens on the Opco Collateral, and any such Liens must be granted in favor of the
Collateral Trustee in the manner set forth in, and be otherwise subject to (and in compliance
with), the Collateral Trust Agreement;




     (q) the incurrence of Indebtedness of a Person or Indebtedness attaching to assets of a Person
that, in either case, becomes a Restricted Subsidiary or Indebtedness attaching to assets that are
acquired by the Borrower or any of its Restricted Subsidiaries, in each case after the Closing Date
as the result of a Permitted Acquisition; provided that (i) such Indebtedness existed at
the time such Person became a Restricted Subsidiary or at the time such assets were acquired and,
in each case, was not created in anticipation thereof, (ii) such Indebtedness is not guaranteed in
any respect by the Borrower, the Company or any other Restricted Subsidiary (other than any such
Person that so becomes a Restricted Subsidiary) except to the extent that such Guarantee is
permitted to be incurred (and is so incurred) pursuant to clause (p) of this Section 6.01 and (iii)
if such Person is acquired by the Borrower, the Equity Interests of such Person are pledged to the
Collateral Agent to the extent required under Section 5.09;



     (r) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness to
finance a Permitted Acquisition; provided that (i) such Indebtedness is not guaranteed in
any respect by any such Restricted Subsidiary (other than any Person acquired (the “acquired
Person”) as a result of such Permitted Acquisition) or by the Borrower or the Company except to
the extent that such Guarantee is permitted to be incurred (and is so incurred) pursuant to clause
(p) of this Section 6.01, and (ii) if such Person is acquired by the Borrower, the Borrower pledges
the Equity Interests of such acquired Person to the Collateral Agent to the extent required under
Section 5.09;



     (s) the incurrence by the Borrower and/or any of its Restricted Subsidiaries of unsecured
Indebtedness, in each case, (i) that does not mature, and is not subject to mandatory repurchase,
redemption or amortization (other than pursuant to customary asset sale or change of control
provisions requiring redemption or repurchase only if and to the extent permitted by this
Agreement) prior to the date that is (x) in the case of Indebtedness incurred by the Borrower, six
months after the Term Loan Maturity Date and (y) in the case of Indebtedness incurred by the
Company or any other Restricted Subsidiary, six months after the Term Loan Maturity Date (as
defined in the Opco Credit Agreement), (ii) that is not exchangeable or convertible into
Indebtedness of the Borrower, the Company (other than other Indebtedness permitted by this clause
(s)) or any other Restricted Subsidiary or any preferred stock or other Equity Interest and (iii)
solely to the extent the Net Cash Proceeds thereof are used to prepay (x) in the case of
Indebtedness incurred by the Borrower, Term Loans hereunder and (y) in the case of Indebtedness
incurred by the Company or any other Restricted Subsidiary, Term Loans under and as defined in the
Opco Credit Agreement pursuant to and to the extent required by the Opco Credit Agreement;



     (t) the incurrence by the Borrower or any of its Restricted Subsidiaries of Indebtedness
consisting of (i) obligations to pay insurance premiums or (ii) take-or-pay obligations contained
in supply agreements, in each case arising in the ordinary course of business and not in connection
with the borrowing of money or Hedging Agreements;



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     (u) the issuance by any of the Excluded Subsidiaries of shares of preferred stock the proceeds
of which are used solely to finance the development, construction or acquisition by such Subsidiary
of fixed or capital assets useful in the conduct of the Permitted Business;



     (v) the incurrence by the Borrower or any of its Restricted Subsidiary of Environmental CapEx
Debt or Necessary CapEx Debt, in an aggregate principal amount not to exceed $250,000,000 at any
time outstanding; provided that, prior to the incurrence of any such Environmental CapEx
Debt or Necessary CapEx Debt, the Borrower or the Company shall deliver to the Administrative Agent
an officers’ certificate designating such Indebtedness as Environmental CapEx Debt or Necessary
CapEx Debt, as applicable;



     (w) the incurrence of Permitted Itiquira Indebtedness; and




     (x) Indebtedness consisting of representations, warranties, covenants and indemnities made by,
and repurchase, payment and other obligations of, the Company or any of its Restricted Subsidiaries
in connection with a South Central Securitization permitted by Section 6.04; provided that such
representations, warranties, covenants, indemnities and repurchase, payment and other obligations
are of the type customarily included in securitizations of accounts receivable intended to
constitute true sales of such accounts receivable to a securitization vehicle.



     SECTION 6.02. Liens. Directly or indirectly, create, incur, assume or suffer to exist any Lien of
any kind on any asset now owned or hereafter acquired by it, except Permitted Liens.



     SECTION 6.03. Limitation on Sale and Leaseback Transactions. Enter into any sale and leaseback
transaction; provided that the Borrower or any of its Restricted Subsidiaries may enter
into a sale and leaseback transaction if (a) the Borrower or that Restricted Subsidiary, as
applicable, could have (i) incurred Indebtedness in an amount equal to the Attributable Debt (if
any) relating to such sale and leaseback transaction under Section 6.01(d) hereof and (ii) incurred
a Lien to secure such Indebtedness (if any) or other obligations associated with such transaction
pursuant to the provisions of Section 6.02 hereof; (b) the gross cash proceeds of that sale and
leaseback transaction are at least equal to the Fair Market Value of the property that is subject
of that sale and leaseback transaction (unless such transaction is a Permitted Tax Lease or a
Permitted Environmental Control Lease); and (c) in the event that such sale and leaseback
transaction constitutes an Asset Sale, the transfer of assets in that sale and leaseback
transaction is permitted by Section 6.04, and (x) if such transaction constitutes a Holdings Asset
Sale, the Borrower applies the proceeds of such transaction if and to the extent required by
Section 2.13 hereof or (y) if such transaction constitutes an Asset Sale that is not a Holdings
Asset Sale, the Company applies the proceeds of such transaction in compliance with the Opco Credit
Agreement, if and to the extent required thereby.



     SECTION 6.04. Mergers, Consolidations and Sales of Assets. (a)(x) Merge into or consolidate
with any other Person, or permit any other Person to merge into or consolidate with it, or
liquidate or dissolve, or (y) sell, transfer, lease, issue or otherwise dispose of (in one
transaction or in a series of transactions) all or substantially all of the assets (whether now
owned or hereafter acquired) of the Borrower or the Company, except that if at the time thereof and
immediately after giving effect thereto no Event of Default or Default shall have occurred and be
continuing (i) any Restricted Subsidiary (other than the Company) and/or MergerCo (whether a
Restricted Subsidiary or not) may merge into the Borrower or the Company in a transaction in which
the Borrower or the Company, as the case may be, is the surviving corporation, (ii) any Restricted
Subsidiary (other than the Company) may merge into or consolidate with any other Restricted
Subsidiary (other than the Company) in a transaction in which the surviving entity is a Restricted
Subsidiary and no Person other than the Borrower or a Restricted Subsidiary receives any
consideration (provided that if any party to any
such transaction is (A) an Opco



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Loan Party, the surviving entity of such transaction shall be
an Opco Loan Party, (B) a Domestic Subsidiary, the surviving entity of such transaction shall be a
Domestic Subsidiary and (C) a Core Collateral Subsidiary, the surviving entity shall be a Core
Collateral Subsidiary), (iii) any merger or consolidation of a Restricted Subsidiary (other than
the Company) will be permitted in connection with an Investment permitted by Section 6.05(g),
6.05(j) or 6.05(l) and (iv) any Restricted Subsidiary (other than the Company or a Core Collateral
Subsidiary) may liquidate or dissolve or, solely for purposes of reincorporating in a different
jurisdiction, merge if the Borrower and the Company determine in good faith that such liquidation
or dissolution or merger is in the best interests of the Borrower and the Company and could not
reasonably be expected to result in a Material Adverse Effect.




     (b) Consummate any Asset Sale (notwithstanding that it may be otherwise permitted under
paragraph (a) above) (including a Sale of Core Collateral) (other than in respect of a sale of the
South Central Securitization Assets which shall be permitted regardless of whether the requirements
of this Section 6.04(b) are satisfied so long as the requirements of clause (d) of this Section
6.04 shall be satisfied) unless (i) other than in the case of a Permitted Tax Lease or a Permitted
Environmental Control Lease, the Borrower (or the Restricted Subsidiary, as the case may be)
receives consideration at the time of the Asset Sale at least equal to the Fair Market Value of the
assets or Equity Interests issued or sold or otherwise disposed of; (ii) other than in the case of
a Permitted Tax Lease, a Permitted Environmental Control Lease, a Permitted Asset Swap or the sale
of equity interests of an Excluded Project Subsidiary that is made in connection with the
conversion of a convertible note of such Excluded Project Subsidiary (or portion thereof) into such
equity interest (provided that the consideration received at the time of such note was issued shall
have satisfied the requirements of this clause (ii)), at least 75% of the consideration received in
the Asset Sale by the Borrower or such Restricted Subsidiary is in the form of cash (for purposes
of this provision, any securities, notes or other obligations received by the Borrower or any such
Restricted Subsidiary from such transferee that are converted by the Borrower or such Restricted
Subsidiary into cash within 180 days of the receipt of such securities, notes or other obligations,
to the extent of the cash received in that conversion will be deemed to be cash); (iii) if such
Asset Sale is a Holdings Asset Sale, the Borrower shall apply the Net Cash Proceeds received
therefrom in accordance with Section 2.13(b) to the extent required thereby; (iv) any consideration
in excess of $15,000,000 received by the Borrower in connection with such Asset Sale pursuant to
this paragraph (b) that is in the form of Indebtedness shall be pledged to the Collateral Agent
pursuant to Section 5.09; (v) with respect to any such Asset Sale (or series of related Asset
Sales) in an aggregate amount in excess of $60,000,000, the Company shall be in compliance, on a
pro forma basis after giving effect to such Asset Sale, with the covenants set forth in Sections
6.13 and 6.14 of the Opco Credit Agreement (as such covenants exist on the date hereof), as if such
Asset Sale had occurred on the first day of the applicable Test Period; and (vi) after giving
effect to any such Asset Sale, no Default or Event of Default shall have occurred and be
continuing.



     (c) In the case of the Company, at any time own, either directly or indirectly or through one
or more Opco Loan Parties, beneficially and of record, less than all of the Equity Interests in any
Core Collateral Subsidiary.



     (d) The Company or any of its Restricted Subsidiaries may sell South Central Securitization
Assets to a Securitization Vehicle in a South Central Securitization; provided that (i) each such
South Central Securitization is effected on market terms, (ii) the aggregate amount of the Sellers’
Retained Interests in such South Central Securitization does not exceed an amount at any time
outstanding that is customary for similar transactions and (iii) the proceeds to each such
Securitization Vehicle from the issuance of Third Party Securities are applied by such
Securitization Vehicle substantially simultaneously with receipt thereof to the purchase from the
Company or such Restricted Subsidiaries of South Central Securitization Assets.



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     SECTION 6.05. Limitation on Investments. Make any Investment except for:



     (a) extensions of trade credit, asset purchases (including purchases of inventory, supplies
and materials) and the licensing or contribution of intellectual property pursuant to joint
marketing arrangements with other Persons;



     (b) Cash Equivalents;




     (c) loans and advances to officers, directors and employees of the Borrower or the Company or
any of the other Restricted Subsidiaries (i) to finance the purchase of Capital Stock of the
Borrower or the Company (provided that the amount of such loans and advances used to
acquire such Capital Stock shall be contributed to the Company in cash as common equity), (ii) for
reasonable and customary business related travel expenses, moving expenses and similar expenses,
and (iii) for additional purposes not contemplated by subclause (i) or (ii) above in an aggregate
principal amount at any time outstanding with respect to this clause (iii) not exceeding $5,000,000
in any fiscal year (with unused amounts in any such period being carried-forward to any succeeding
fiscal year);



     (d) Investments existing on the Closing Date (as defined in the Opco Credit Agreement) and any
extensions, renewals or reinvestments thereof, so long as the aggregate amount of all Investments
pursuant to this clause (d) is not increased at any time above the amount of such Investments
existing on the Closing Date;



     (e) Investments in Hedging Obligations to the extent not prohibited by Section 6.01;



     (f) Investments received in connection with the bankruptcy or reorganization of trade
creditors, trade counterparties, suppliers or customers and in settlement of delinquent obligations
of, and other disputes with, customers;



     (g) Investments to the extent that payment for such Investments is made with Capital Stock of
(x) if the Holdings Reorganization does not occur, the Company, and (y) in the event the Holdings
Reorganization does occur, the Borrower;



     (h) Investments in any Subsidiary, as valued at the Fair Market Value of such Investment at
the time each such Investment is made, in an aggregate amount that, at the time such Investment is
made, would not exceed the Retained Prepayment Amount at such time;



     (i) Investments (including in the form of loans) in the Borrower or any Opco Loan Party;



     (j) Investments constituting Permitted Acquisitions;



     (k) Investments made to repurchase or retire common stock of the Borrower or the Company owned
by any employee stock ownership plan or key employee, directors and officers, or other stock
ownership plans of the Borrower or the Company, as applicable;



     (l) (i) additional Investments (including Investments in Excluded Subsidiaries, Minority
Investments and Unrestricted Subsidiaries) and (ii) Investments in joint ventures or similar
entities that do not constitute Restricted Subsidiaries, in each case as valued at the Fair Market
Value of such Investment at the time each such Investment is made, (A) in an aggregate amount that,
at the time such Investment is made, would not exceed the sum of (x) $600,000,000 plus (y)
the Available Amount at such time plus (z)
to the extent such amounts do not increase the Available Amount, an amount equal to any
repayments, interest, returns, profits, distributions, income and similar amounts actually received
in cash in respect of



86









 




any such Investment (which amount shall not exceed the amount of such
Investment valued at the Fair Market Value of such Investment at the time such Investment was made)
and an amount equal to any letters of credit, guarantees and other contingent credit support that
constitute Investments that were made pursuant to this clause (l) to the extent such letters of
credit, guarantees or other contingent credit support are cancelled, expire or are otherwise
terminated without any payment being required thereon, and/or (B) in the case of Investments
described in clause (ii) above only that are made by the Company or any of its Restricted
Subsidiaries (other than any Excluded Subsidiary), in an aggregate amount that, at the time such
Investment is made, would be permitted to be expended as a Capital Expenditure under Section 6.12
of the Opco Credit Agreement (as such Section exists on the date hereof but for purposes of this
clause the reference to $450,000,000 therein shall be deemed to be a reference to $540,000,000), to
the extent that (x) the applicable joint venture owns an interest in assets the addition of which
would have been a Capital Expenditure if acquired or constructed, and owned, directly by the
Company or any of its Restricted Subsidiaries (other than any Excluded Subsidiary) and (y) the
ability of the Company and/or one or more of its Restricted Subsidiaries to receive cash flows
attributable to its interest therein is not restricted by contract, Applicable Law or otherwise;
provided, however, that in determining whether any Investments in joint ventures or
similar entities that do not constitute Restricted Subsidiaries made in cash or Cash Equivalents
would be permitted under Section 6.05(l)(ii), the maximum aggregate amount of such Investments made
in cash or Cash Equivalents to be allocated to clause (ii)(A)(x) above only shall not exceed
$360,000,000;




     (m) Investments in any Excluded Subsidiary by another Excluded Subsidiary, other than any such
Investments made with the proceeds of Non-Recourse Indebtedness; provided, however,
that (i) Investments in an Excluded Subsidiary with the proceeds of Non-Recourse Indebtedness by
another Excluded Subsidiary that is a direct or indirect parent of such Excluded Subsidiary shall
be permitted and (ii) Investments in an Excluded Subsidiary with the proceeds of Non-Recourse
Indebtedness by another Excluded Subsidiary that is formed solely for the purposes of incurring
such Non-Recourse Indebtedness, that has no other assets other than de minimis assets and that has
the same direct parent as such Excluded Subsidiary shall be permitted;



     (n) [Reserved];



     (o) the contribution of any one or more of the Specified Facilities to a Restricted Subsidiary
that is not an Opco Loan Party;



     (p) Investments that are received in consideration of the contribution by the Borrower, the
Company or any of its Restricted Subsidiaries of assets (other than cash, Cash Equivalents or Core
Collateral), valued at the Fair Market Value of such Investment at the time such Investment is
made, in an aggregate amount that, at the time such Investment is made, would not exceed the Fair
Market Value of the sum of (i) all Capital Stock of the Borrower and/or the Company (as applicable)
paid as consideration in connection with a Permitted Acquisition (valued at the time of
consummation of such Permitted Acquisition) consummated after the Closing Date and on or prior to
the date of such Investment so long as all Equity Interests and other assets that were acquired by
the Borrower, the Company or any of their Restricted Subsidiaries through such Permitted
Acquisition have been pledged, if acquired by the Borrower, to the Collateral Agent to the extent
required under Section 5.09 or, if acquired by the Company or any other Restricted Subsidiary, to
the Collateral Agent under and as defined in the Opco Credit Agreement to the extent required by
the Opco Credit Agreement (provided that such acquired assets shall not become Excluded
Assets pursuant to clauses (viii) or (xiii) of the definition thereof as set forth in the Opco
Credit Agreement on the date hereof) and (ii) all assets that (A) were contributed, without
consideration, by an Excluded Subsidiary to the Borrower, the Company or an Opco Subsidiary
Guarantor after the Closing Date (valued at the time of such contribution) or (B) were owned
at the time by an Excluded Subsidiary that became an Opco Subsidiary Guarantor after the Closing
Date and that



87









 




have been pledged to the Collateral Agent under and as defined in the Opco Credit
Agreement (valued at the time of such guarantee); provided that any amounts specified to in
clauses (i) and (ii) above shall not be used to increase any amounts set forth in the other clauses
of this Section 6.05;




     (q) (i) Investments permitted under Section 6.06 and (ii) Guarantees permitted under Section
6.01;



     (r) Investments consisting of Seller’s Retained Interests in a South Central Securitization
permitted by Section 6.04 and any servicing fees and other similar rights related to the South
Central Securitization permitted by Section 6.04;



     (s) Investments pursuant to transactions described Section 6.08(b)(xix); and



     (t) Investments existing on the Closing Date that were made after the “Closing Date” (as
defined in the Opco Credit Agreement), but only to the extent such Investments reduced the
Available Amount (as defined in the Opco Credit Agreement) at the time made.



     SECTION 6.06. Limitation on Dividends. Declare or pay any dividends (other than dividends payable
solely in its Capital Stock) or return any capital to its shareholders or make any other
distribution, payment or delivery of property or cash to its shareholders as such, or redeem,
retire, purchase or otherwise acquire, directly or indirectly, for consideration, any shares of any
class of its Capital Stock or the Capital Stock of any direct or indirect parent of the Borrower
now or hereafter outstanding (or any options or warrants or stock appreciation rights issued with
respect to any of its Capital Stock), or permit any of the Restricted Subsidiaries to purchase or
otherwise acquire for consideration (other than in connection with an Investment permitted by
Section 6.05 (except for any such Investment involving the purchase of Capital Stock of the Company
or, following the Holdings Reorganization and the Holdings Contribution, the Borrower from
shareholders of the Company or the Borrower, as the case may be) any shares of any class of the
Capital Stock of the Borrower, now or hereafter outstanding (or any options or warrants or stock
appreciation rights issued with respect to any of its Capital Stock) (all of the foregoing
“Dividends”); provided that so long as no Default or Event of Default exists or
would exist after giving effect thereto:



     (a) the Company or, following the Holdings Reorganization and the Holdings Contribution, the
Borrower may redeem in whole or in part any of its Capital Stock for another class of Capital Stock
or rights to acquire its Capital Stock or with proceeds from substantially concurrent equity
contributions or issuances of new shares of its Capital Stock; provided that such other
class of Capital Stock contains terms and provisions at least as advantageous to the Lenders in all
material respects as those contained in the Capital Stock redeemed thereby;



     (b) the Company or, following the Holdings Reorganization and the Holdings Contribution, the
Borrower may repurchase shares of its Capital Stock (or any options or warrants or stock
appreciation rights issued with respect to any of its Capital Stock) held by current or former
officers, directors and employees of the Company or the Borrower, as the case may be, and its
applicable subsidiaries in an aggregate amount not to exceed (i) $12,000,000 in any fiscal year and
(ii) $60,000,000 in the aggregate from and after the Closing Date, so long as such repurchase is
pursuant to, and in accordance with the terms of, management and/or employee stock plans, stock
subscription agreements, employment agreements or shareholder agreements or termination agreements;



     (c) in addition to clause (d) below, the Borrower or any Restricted Subsidiary (and prior to
the Holdings Reorganization, the Company) may declare and make distributions on its Capital Stock
at any time or pay other Dividends; provided that the aggregate amount of such
distributions or Dividends



88









 




paid by the Borrower and any such Restricted Subsidiary (and prior to
the Holdings Reorganization, the Company) pursuant to this clause (c) shall not exceed the
Available Amount at the time of such distribution or Dividend;




     (d) in addition to clause (c) above, the Company or, at any time after the Holdings
Reorganization and the Holdings Contribution, the Borrower (i) may declare and make distributions
on its Preferred Stock pursuant to the terms of such Preferred Stock (as in effect on the Closing
Date, it being understood that upon the consummation of the Holdings Reorganization the Borrower
may become the issuer of such Preferred Stock), (ii) may redeem in whole or in part any of its
Preferred Stock with proceeds from substantially concurrent equity contributions or issuances of
new shares of its Capital Stock (other than Disqualified Stock) and (iii) may redeem in whole or in
part any of its Sponsor Preferred Stock with the net cash proceeds from Asset Sales but only to the
extent such net cash proceeds were first offered to and declined by Term Lenders under (and in
accordance with) the Opco Credit Agreement and not otherwise used for purposes set forth in the
definition of “Retained Prepayment Amount”;



     (e) the Company or any other Restricted Subsidiary may pay any Dividend (or, in the case of
any partnership or limited liability company, any similar distribution) to (i) the Borrower or any
Opco Loan Party or (ii) the holders of its Equity Interests on a pro rata basis (it being
understood and agreed that any such Dividend under this clause (ii) by the Company shall only be
allowed following the Holdings Reorganization and the Holdings Contribution);



     (f) the Company or, following the Holdings Reorganization and the Holdings Contribution, the
Borrower may make payments to holders of the Company’s or the Borrower’s, as the case may be,
Capital Stock in lieu of the issuance of fractional shares of its Capital Stock;



     (g) the Company or, following the Holdings Reorganization and the Holdings Contribution, the
Borrower may enter into transactions for the purchase, redemption, acquisition, cancellation or
other retirement for a nominal value per right of any rights granted to all the holders of Capital
Stock of the Company or the Borrower, as the case may be, pursuant to any shareholders’ rights plan
adopted for the purpose of protecting shareholders from takeover tactics; provided that any
such purchase, redemption, acquisition, cancellation or other retirement of such rights is not for
the purpose of evading the limitations of this covenant (all as determined in good faith by the
Board of Directors of the Company or the Borrower, as the case may be);



     (h) the Borrower, the Company and/or any of their Subsidiaries may enter into transactions for
the purchase, redemption, acquisition, cancellation or other retirement of preferred stock of
Itiquira to effectuate the Itiquira Refinancing; and



     (i) in addition to the foregoing clauses, the Company or, following the Holdings
Reorganization and the Holdings Contribution, the Borrower may pay Dividends, return capital to its
shareholders or make any other distribution of property or cash to its shareholders in an aggregate
amount of up to $150,000,000 in any fiscal year.



     SECTION 6.07. Limitations on Debt Payments; Restrictive Agreements. (a) Make any distribution,
whether in cash, property, securities or a combination thereof, other than regularly scheduled
payments of principal, fees and interest as and when due (to the
extent not prohibited by applicable subordination provisions and whether or not such regularly
scheduled payments may at the obligor’s option be paid in kind or in other securities), in respect
of, or pay, or offer or commit to pay, or directly or indirectly redeem, repurchase, retire or
otherwise acquire for consideration, any Indebtedness (other than intercompany Indebtedness of the
Borrower, the Company and their Subsidiaries), except (i) the payment



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of the Indebtedness created
hereunder and Indebtedness under the Opco Credit Agreement, (ii) the incurrence of Indebtedness
under Section 6.01 which refinances other Indebtedness that was incurred under Section 6.01 (and in
connection with such refinancing the payment of any interest, fees and premiums payable in respect
of the principal being refinanced), (iii) the payment of secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of, or a Recovery Event with respect to, the property or
assets securing such Indebtedness, (iv) the payment of Non-Recourse Indebtedness or Indebtedness
permitted by Section 6.01(p) of an Excluded Subsidiary with internally generated cash flow of such
Excluded Subsidiary, (v) any such payment or distribution in an aggregate amount not in excess of
the Available Amount at the time of such payment or distribution, (vi) any such payment or
distribution in an aggregate amount not in excess of the Retained Prepayment Amount at the time of
such payment or distribution and (vii) the payment of Non-Recourse Indebtedness of any Restricted
Subsidiary if the Lien on such property or assets of such Restricted Subsidiary securing such
Non-Recourse Indebtedness shall be released and such property or assets shall become Opco
Collateral and shall be pledged to the Collateral Agent under and as defined in the Opco Credit
Agreement.




     (b) Enter into, incur or permit to exist any agreement or other arrangement that prohibits,
restricts or imposes any condition upon the ability of the Borrower to create, incur or permit to
exist any Lien upon any of its property or assets in favor of the Secured Parties securing the
obligations under this Agreement (it being understood that any agreement that contains general
prohibitions or restrictions on the existence of Liens but expressly permits Liens in favor of the
Secured Parties securing the obligations under this Agreement shall not be prohibited or otherwise
limited by the covenant contained in this Section 6.07(b)); provided that the foregoing
shall not apply to (i) restrictions and conditions imposed by law, (ii) customary restrictions and
conditions contained in agreements relating to the purchase or sale of an asset pending such
purchase or sale; provided such restrictions and conditions apply only to the asset that is
to be purchased or sold and such purchase or sale is permitted hereunder, (iii) restrictions and
conditions on property and assets that constitute Excluded Assets or Holdings Excluded Assets (as
defined in the Collateral Agreement), (iv) restrictions or conditions existing on the Closing Date,
but shall apply to any extension or renewal of, or any amendment or modification expanding the
scope of, any such restriction or condition in any material respect, (v) restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such
restrictions or conditions apply only to the property or assets securing such Indebtedness, (vi)
restrictions in connection with sale and leaseback transactions permitted by Section 6.03, but only
with respect to the assets subject to such transactions, (vii) customary provisions in joint
venture, stockholder, membership, limited liability company or partnership agreements or
organizational documents relating to joint ventures or partnerships or owners , participation,
shared facility or other similar agreements relating to Project Interests and (viii) customary
provisions (including negative pledges) in leases, licenses, permits and other contracts
restricting the assignment thereof (whether for collateral purposes or otherwise) or otherwise
restricting or affecting the property subject thereto.



     (c) Directly or indirectly, create or permit to exist or become effective any consensual
encumbrance or restriction on the ability of any Restricted Subsidiary (other than an Excluded
Subsidiary) to (i) pay dividends or make any other distributions on its Capital Stock to the
Borrower, the Company or any of the other Restricted Subsidiaries, or with respect to any other
interest or participation in, or measured by, its profits, or pay any Indebtedness owed to the
Borrower, the Company or any of the other Restricted Subsidiaries; (ii) make loans or advances to
the Borrower, the Company or any of the other Restricted Subsidiaries; or (iii) transfer any of
its properties or assets to the Borrower, Company or any of
the other Restricted Subsidiaries. The restrictions in this Section 6.07(c) will not apply to
encumbrances or restrictions existing under or by reason of:



          (A) agreements governing Existing Indebtedness and the Senior Notes as in effect on the
Closing Date and any amendments, modifications, restatements, renewals, increases, supplements,




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refundings, replacements or refinancings of those agreements; provided that such
amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements
or refinancings are no more restrictive, taken as a whole, with respect to such dividend and other
payment restrictions than those contained in those agreements on the Closing Date;




          (B) any Loan Document, any Opco Loan Document and the loan documentation with respect to any
Revolver Refinancing Indebtedness (provided that such restrictions and conditions, when
taken as a whole, are the same in all material respects as (or less restrictive than) those
contained herein);




          (C) applicable law, rule, regulation or order;




          (D) customary non-assignment provisions in contracts, agreements, leases, permits and
licenses;




          (E) purchase money obligations for property acquired and Capital Lease Obligations that impose
restrictions on the property purchased or leased of the nature described in clause (iii) of this
Section 6.07(c);




          (F) any agreement for the sale or other disposition of the stock or assets of a Restricted
Subsidiary that restricts distributions by that Restricted Subsidiary pending the sale or other
disposition;




          (G) Permitted Refinancing Indebtedness; provided that the restrictions contained in
the agreements governing such Permitted Refinancing Indebtedness are not materially more
restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness
being refinanced;




          (H) Liens permitted to be incurred under the provisions of Section 6.02 that limit the right
of the debtor to dispose of the assets subject to such Liens;




          (I) provisions limiting the disposition or distribution of assets or property in joint venture
agreements, ownership, participation, shareholders, partnership or limited liability company
agreements relating to Project Interests, asset sale agreements, sale-leaseback agreements, stock
sale agreements, agreements governing Non-Recourse Indebtedness and other similar agreements, which
limitation is applicable only to the assets that are the subject of such agreements;




          (J) restrictions on cash or other deposits or net worth or other similar requirements imposed
by customers under contracts entered into in connection with a Permitted Business;




          (K) restrictions or conditions contained in any trading, netting, operating, construction,
service, supply, purchase, sale or similar agreement to which the Borrower or any of its Restricted
Subsidiaries is a party entered into in connection with a Permitted Business; provided that
such agreement prohibits the encumbrance of solely the property or assets of the Borrower or the
Restricted Subsidiaries that are the subject of that agreement, the payment rights arising
thereunder and/or the proceeds thereof and not of any other asset or property of the Borrower or
such Restricted Subsidiaries or the assets or property of any other Restricted Subsidiary;




          (L) any instrument governing Indebtedness or Capital Stock of a Person acquired by the
Borrower or any of the Restricted Subsidiaries as in effect at the time of such acquisition (except
to the extent such Indebtedness or Capital Stock was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person, or the property or assets
of the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness
was permitted by the terms of this Agreement to be incurred;





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          (M) Indebtedness of a Restricted Subsidiary existing at the time it became a Restricted
Subsidiary if such restriction was not created in connection with or in anticipation of the
transaction or series of transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was acquired by the Borrower or another Restricted Subsidiary;




          (N) with respect to clause (iii) of this Section 6.07(c) only, restrictions encumbering
property at the time such property was acquired by the Borrower or any of the Restricted
Subsidiaries, so long as such restriction relates solely to the property so acquired and was not
created in connection with or in anticipation of such acquisition; and




          (O) any encumbrance or restriction of the type referred to in clauses (i), (ii) or (iii) of
this Section 6.07(c) (except to the extent that any of clauses (A) through (N) of this Section
6.07(c) refers or applies only to certain of such clauses (i), (ii) or (iii), and, in such case,
only to such applicable clause), imposed by any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings of the contracts, instruments or
obligations referred to in clauses (A) through (N) of this Section 6.07(c); provided that
such amendments, modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, when taken as a whole, in the good faith judgment of the Chief
Financial Officer of the Borrower or the Company, no more restrictive with respect to such dividend
and other payment restrictions than those contained in the dividend or other payment restrictions
prior to such amendment, modification, restatement, renewal, increase, supplement, refunding,
replacement or refinancing.




     SECTION 6.08. Transactions with Affiliates. (a) Make any payment to, or sell, lease, transfer
or otherwise dispose of any of its properties or assets to, or purchase any property or assets
from, or enter into or make or amend any transaction, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate of the Borrower (each, an
“Affiliate Transaction”), unless (i) the Affiliate Transaction is on terms that are no less
favorable to the Borrower (as reasonably determined by the Borrower) or the relevant Restricted
Subsidiary than those that would have been obtained in a comparable transaction by the Borrower or
such Restricted Subsidiary with an unrelated Person; and (ii) the Borrower delivers to the
Administrative Agent with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $50,000,000, a resolution of the Board
of Directors of the Borrower attached to an officers’ certificate certifying that such Affiliate
Transaction complies with clause (i) of this Section and that such Affiliate Transaction has been
approved by a majority of the disinterested members of such Board of Directors.



     (b) The following items will not be deemed to be Affiliate Transactions and, therefore, will
not be subject to the provisions of this Section:



          (i) any employment agreement or director’s engagement agreement, employee benefit plan,
officer and director indemnification agreement or any similar arrangement entered into by the
Borrower or any of its Restricted Subsidiaries in the ordinary course of business or approved by
the Board of Directors of the Borrower in good faith;




          (ii) transactions between or among the Company and the other Opco Loan Parties and any
transactions pursuant to Section 9.22 of the Opco Credit Agreement (as it exists on the date
hereof);




          (iii) transactions between or among Excluded Subsidiaries, and any Guarantee, guarantee and/or
other credit support provided by the Company and/or any other Restricted Subsidiary in respect of
any Subsidiary or any Minority Investment so long as all holders of Equity Interests in such
Minority Investment (including the Company or other Restricted Subsidiary, as applicable) shall
participate directly or indirectly in such applicable Guarantee, guarantee and/or other credit
support or shall provide a




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commitment in respect of any related obligation, in each case, on a pro
rata basis relative to their Equity Interests in such Minority Investment; provided that
any such transaction shall be fair and reasonable and beneficial to the Company and its Restricted
Subsidiaries (taken as a whole) and consistent with Prudent Industry Practice;




          (iv) payment of reasonable fees and other compensation to directors who are not otherwise
Affiliates of the Borrower;




          (v) any issuance of Equity Interests (other than Disqualified Stock) of the Borrower or the
Restricted Subsidiaries to Affiliates of the Borrower;




          (vi) Investments or Dividends that do not violate Section 6.05 or 6.06 hereof;




          (vii) any agreement in effect as of the Closing Date or any amendment thereto or replacement
thereof and any transaction contemplated thereby or permitted thereunder, so long as any such
amendment or replacement agreement taken as a whole is not more disadvantageous to the Lenders than
the original agreement as in effect on the Closing Date;




          (viii) payments or advances to employees or consultants that are incurred in the ordinary
course of business or that are approved by the Board of Directors of the Borrower in good faith;




          (ix) the existence of, or the performance by the Borrower, the Company or any of the other
Restricted Subsidiaries of its obligations under the terms of, any stockholders agreement
(including any registration rights agreement or purchase agreement related thereto) to which it is
a party as of the Closing Date and any similar agreements which it may enter into thereafter;
provided, however, that the existence of, or the performance by the Company, the
Borrower or any of the other Restricted Subsidiaries of obligations under, any future amendment to
any such existing agreement or under any similar agreement entered into after the Closing Date
shall only be permitted by this clause (ix) to the extent that the terms of any such amendment or
new agreement are not otherwise more disadvantageous to the Lenders than such existing agreement in
any material respect;




          (x) transactions permitted by, and complying with, the provisions of Section 6.04(a);




          (xi) transactions with customers, clients, suppliers, joint venture partners or purchasers or
sellers of goods or services, in each case, in the ordinary course of business (including pursuant
to joint venture agreements) and otherwise in compliance with the terms of this Agreement that are
fair to the Borrower and the Restricted Subsidiaries, in the reasonable determination of the Board
of Directors of the Borrower or the senior management thereof, or are on terms not materially less
favorable taken as a whole as might reasonably have been obtained at such time from an unaffiliated
party;




          (xii) any repurchase, redemption or other retirement of Capital Stock of the Company or,
following the Holdings Reorganization and the Holdings Contribution, the Borrower held by employees
of the Company or the Borrower, as the case may be, or any of its applicable subsidiaries at a
price not in excess of the Fair Market Value thereof;




          (xiii) [Reserved];




          (xiv) back-to-back transactions, O&M agreements and construction management agreements,
technical and other service agreements, in each case between or among Restricted Subsidiaries
entered into in the ordinary course of business and otherwise in compliance with the terms of this
Agreement that are on terms no less favorable to the relevant Restricted Subsidiary (as reasonably





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determined by it) than those that would have been obtained in a comparable transaction by such
Restricted Subsidiary with an unrelated Person;




          (xv) transactions relating to management, administrative or technical services between the
Borrower and its Restricted Subsidiaries or between Restricted Subsidiaries;




          (xvi) the Guarantee of Permitted Itiquira Indebtedness to the extent permitted by Section
6.01(i);




          (xvii) the issuance of letters of credit under the Opco Credit Agreement, or letters of credit
pursuant to other financing facilities, to support the obligations of any Excluded Subsidiary;




          (xviii) any South Central Securitization permitted by Section 6.04;




          (xix) back-to-back transactions, energy management or energy marketing services agreements and
agency agreements in each case between NRG Power Marketing and any Restricted Subsidiary entered
into in the ordinary course of business and otherwise in compliance with the terms of this
Agreement that are on terms no less favorable to NRG Power Marketing (as reasonably determined by
it) than those that would have been obtained in a comparable transaction by NRG Power Marketing
with an unrelated person;




          (xx) any tax sharing agreement between or among the Borrower, the Company and their
Subsidiaries so long as such tax sharing agreement is on fair and reasonable terms with respect to
each participant therein; and




          (xxi) any agreement to do any of the foregoing.




     SECTION 6.09. Business Activities. Fundamentally and substantively alter the character of the
business of the Borrower, the Company and their Subsidiaries, taken as a whole, from the Permitted
Business.



     SECTION 6.10.
Other Indebtedness and Agreements. Permit any waiver, supplement, modification,
amendment, termination or release of any indenture, instrument or agreement pursuant to which any
Material Indebtedness of the Borrower, the Company or any of their Subsidiaries (other than in
respect of any Specified Hedging Agreement or any Opco Specified Hedging Agreement and Material
Indebtedness between the Borrower, the Company and their Subsidiaries or between Subsidiaries or
the Borrower or the Company) is outstanding if the effect of such waiver, supplement, modification,
amendment, termination or release would materially increase the obligations of the obligor or
confer additional material rights on the holder of such Indebtedness in a
manner materially adverse to the Borrower, the Company and their Subsidiaries, taken as a
whole, or the Lenders.



     SECTION
6.11. Designation of Restricted and Unrestricted Subsidiaries and Excluded Subsidiaries. (a) The Board of Directors of the Borrower (or any committee expressly authorized by the Board of
Directors of the Borrower) may designate any Restricted Subsidiary (other than, if such Restricted
Subsidiary is a subsidiary of the Company, a subsidiary constituting or owning Core Collateral) to
be an Unrestricted Subsidiary if that designation would not cause a Default or Event of Default;
provided that, notwithstanding anything in this Agreement to the contrary, at all times
that any Indebtedness (other than contingent obligations not then due and payable) under the Opco
Credit Agreement shall be outstanding the Company and the Opco Restricted Subsidiaries shall be (or
shall be deemed to be) Restricted Subsidiaries of the Borrower hereunder. If a Restricted
Subsidiary (other than an Excluded Subsidiary that becomes an Excluded Subsidiary after the Closing
Date) is designated as an



94









 




Unrestricted Subsidiary, the aggregate Fair Market Value of all
outstanding Investments owned by the Borrower and its Restricted Subsidiaries in the Subsidiary of
the Borrower designated as an Unrestricted Subsidiary will be deemed to be an Investment made as of
the time of the designation and will reduce the amount available for Investments under Sections
6.05(h) (if applicable), 6.05(l) or 6.05(p) (it being understood and agreed that (i) at all times
that any Indebtedness (other than contingent obligations not then due and payable) under the Opco
Credit Agreement shall be outstanding any such designation pursuant to this sentence may only be
made if (and shall be made at each time that) such a designation is also made to designate such
applicable Subsidiary as an Opco Unrestricted Subsidiary under the Opco Credit Agreement and (ii)
the Company may not be designated as an Unrestricted Subsidiary at any time). Such designation
will only be permitted if the Investment would be permitted at that time and if the Restricted
Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Board of Directors of
the Borrower may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if that
redesignation would not cause a Default or Event of Default (it being understood and agreed that at
all times that any Indebtedness (other than contingent obligations not then due and payable) under
the Opco Credit Agreement shall be outstanding any such a redesignation pursuant to this sentence
may only be made if (and shall be made at each time that) such a redesignation is also made to
redesignate such applicable Subsidiary as an Opco Restricted Subsidiary under the Opco Credit
Agreement).




     SECTION 6.12. [Reserved].



     SECTION 6.13. [Reserved].



     SECTION 6.14. [Reserved].



     SECTION 6.15. Fiscal Year. With respect to the Borrower or the Company, change its fiscal year-end
to a date other than December 31.



ARTICLE VII.




Events of Default




     In case of the happening of any of the following events (“Events of Default”):



     (a) any representation or warranty made or deemed made in or in connection with any Loan
Document (other than those specified in clause (l) below) or the Borrowings hereunder, or any
representation, warranty, statement or information contained in any report, certificate, financial
statement or other instrument furnished in connection with or pursuant to any Loan Document by the
Borrower, shall prove to have been false or misleading in any material respect when so made, deemed
made or furnished;



     (b) default shall be made in the payment of any principal of any Term Loan when and as the
same shall become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise;



     (c) default shall be made in the payment of any interest on any Term Loan or any Fee or any
other amount (other than an amount referred to in (b) above) due under any Loan Document, when and
as the same shall become due and payable, and such default shall continue unremedied for a period
of five Business Days;



     (d) default shall be made in the due observance or performance by the Borrower of any
covenant, condition or agreement contained in Section 5.01(a), 5.05, 5.08 or 5.11 or in Article VI;



95









 





     (e) default shall be made in the due observance or performance by the Borrower of any
covenant, condition or agreement contained in any Loan Document (other than those specified in
clauses (b), (c) or (d) above or clause (l) below) and such default shall continue unremedied for a
period of 45 days after notice thereof from the Administrative Agent, the Collateral Agent or any
Lender to the Borrower;



     (f) the Borrower or any Restricted Subsidiary shall (i) fail to pay any principal or interest,
regardless of amount, due in respect of any Material Indebtedness, when and as the same shall
become due and payable, or (ii) any other event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or
without the giving of notice, the lapse of time or both) the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to
become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to
its scheduled maturity; provided that clause (ii) shall not apply to secured Indebtedness
that becomes due as a result of the voluntary sale or transfer of the property or assets securing
such Indebtedness; provided, further that clause (i) and (ii) shall not apply to
(A) Designated Non-Recourse Indebtedness and (B) any other Non-Recourse Indebtedness of the
Borrower, the Company and the other Restricted Subsidiaries (except to the extent that the
Borrower, the Company or any of the other Restricted Subsidiaries that are not parties to such
Non-Recourse Indebtedness becomes directly or indirectly liable, including pursuant to any
contingent obligation, for any Indebtedness thereunder and such liability, individually or in the
aggregate, exceeds $125,000,000);



     (g) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that
(i) is for relief against the Borrower, the Company or any of the other Restricted Subsidiaries
(other than the Exempt Subsidiaries) that is a Significant Subsidiary or any group of Restricted
Subsidiaries (other than the Exempt Subsidiaries) that, taken together, would constitute a
Significant Subsidiary in an involuntary case; (ii) appoints a custodian of the Borrower, the
Company or any of the other Restricted
Subsidiaries (other than the Exempt Subsidiaries) that is a Significant Subsidiary or any
group of Restricted Subsidiaries (other than the Exempt Subsidiaries) that, taken together, would
constitute a Significant Subsidiary or for all or substantially all of the property of the
Borrower, the Company or any of the other Restricted Subsidiaries (other than the Exempt
Subsidiaries) that is a Significant Subsidiary or any group of Restricted Subsidiaries (other than
the Exempt Subsidiaries) that, taken together, would constitute a Significant Subsidiary; or (iii)
orders the liquidation of the Borrower, the Company or any of the other Restricted Subsidiaries
(other than the Exempt Subsidiaries) that is a Significant Subsidiary or any group of Restricted
Subsidiaries (other than the Exempt Subsidiaries) that, taken together, would constitute a
Significant Subsidiary; and, in each of clauses (i), (ii) or (iii), the order or decree remains
unstayed and in effect for 60 consecutive days;



     (h) the Borrower, the Company or any of the other Restricted Subsidiaries (other than the
Exempt Subsidiaries) that is a Significant Subsidiary or any group of Restricted Subsidiaries
(other than the Exempt Subsidiaries) that, taken together, would constitute a Significant
Subsidiary, pursuant to or within the meaning of Bankruptcy Law (i) commences a voluntary case;
(ii) consents to the entry of an order for relief against it in an involuntary case; (iii) consents
to the appointment of a custodian of it or for all or substantially all of its property; (iv) makes
a general assignment for the benefit of its creditors; or (v) generally is not paying its debts as
they become due;



     (i) one or more judgments for the payment of money in an aggregate amount in excess of
$100,000,000 (excluding therefrom any amount covered by insurance) shall be rendered against the
Borrower, the Company or any other Restricted Subsidiary or any combination thereof and the same
shall remain undischarged for a period of 60 consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment creditor to levy upon assets
or properties of the Borrower, the Company or any of the other Restricted Subsidiaries to enforce
any such judgment;



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provided that this clause (i) shall not apply to (A) Designated Non-Recourse
Indebtedness and (B) any other Non-Recourse Indebtedness of the Borrower, the Company and the other
Restricted Subsidiaries (except to the extent that the Borrower, the Company or any of the other
Restricted Subsidiaries that are not parties to such Non-Recourse Indebtedness becomes directly or
indirectly liable, including pursuant to any contingent obligation, for any Indebtedness thereunder
and such liability, individually or in the aggregate, exceeds $125,000,000;




     (j) an ERISA Event shall have occurred that, when taken together with all other such ERISA
Events, could reasonably be expected to result in liability of the Borrower and its ERISA
Affiliates in an aggregate amount exceeding $100,000,000; provided, however, that
the parties acknowledge and agree that that certain Irrevocable Standby Letter of Credit (or any
renewal, extension or replacement thereof that does not increase the face amount thereof) issued by
the Sumitomo Mitsui Banking Corporation in favor of the Benefits Committee of the Texas Genco
Retirement Plan, dated as of June 28, 2005, for an amount not exceeding $54,900,000, shall not be
deemed to be a liability for purposes of determining whether the $100,000,000 threshold set in this
clause (j) of Article VII is exceeded (but that any other letter of credit or other security
provided pursuant to Section 401(a)(29) of the Tax Code that constitutes an ERISA Event shall be
deemed to be a liability for purposes of this Article VII);



     (k) [Reserved];



     (l) material breach by the Borrower of any material representation or warranty or covenant,
condition or agreement in the Security Documents, the repudiation by the Borrower of any of its
material obligations under any of the Security Documents or the unenforceability of any of the
Security Documents against the Borrower for any reason with respect to Collateral having an
aggregate Fair Market Value of $50,000,000 or more in the aggregate; or



     (m) there shall have occurred a Change in Control;


then, and in every such event (other than an event with respect to the Borrower described in
paragraph (g) or (h) above), and at any time thereafter during the continuance of such event either
or both of the following actions may be taken: the Administrative Agent may with the consent of the
Required Lenders, and at the request of the Required Lenders shall, by notice to the Borrower,
terminate forthwith the Term Loan Commitments, declare the Term Loans then outstanding to be
forthwith due and payable in whole or in part, whereupon the principal of the Term Loans so
declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees
and all other liabilities of the Borrower accrued hereunder and under any other Loan Document,
shall become forthwith due and payable, without presentment, demand, protest or any other notice of
any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in
any other Loan Document to the contrary notwithstanding, and the Administrative Agent and the
Collateral Agent shall have the right to take all or any actions and exercise any remedies
available to a secured party under the Security Documents or applicable law or in equity; and in
any event with respect to an event in respect of the Borrower described in paragraph (g) or (h)
above, the Term Loan Commitments shall automatically terminate and the principal of the Term Loans
then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of the Borrower accrued hereunder and under any other Loan Document, shall
automatically become due and payable, without presentment, demand, protest or any other notice of
any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in
any other Loan Document to the contrary notwithstanding, and the Administrative Agent and the
Collateral Agent shall have the right to take all or any actions and exercise any remedies
available to a secured party under the Security Documents or applicable law or in equity.




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     Without limitation of, and after giving effect to, Section 6.7 of the Collateral Agreement,
all proceeds received by the Administrative Agent or the Collateral Agent, as the case may be, from
any Person in respect of any sale of, collection from, or other realization upon all or any part of
the Collateral under any Security Document shall be held by the Administrative Agent or the
Collateral Agent as Collateral for, and applied in full or in part by the Administrative Agent or
the Collateral Agent against, the applicable obligations hereunder then due and owing in the
following order of priority: first, to the ratable payment of all costs and expenses of
such sale, collection or other realization, including reasonable and documented fees, costs and
expenses of the Agents and their agents and counsel, and all other expenses, liabilities and
advances made or incurred by the Agents in connection therewith, and all amounts in each case for
which such Agents are entitled to payment, reimbursement or indemnification under the Loan
Documents (in their capacity as such), and to the payment of all costs and expenses paid or
incurred by the Agents in connection with the exercise of any right or remedy under the Loan
Documents, all in accordance with the terms of the Loan Documents second, to the extent of
any excess proceeds, to the payment of all other obligations hereunder and under the other Loan
Documents for the ratable benefit of the holders thereof; and third, to the extent of any
excess proceeds, to the payment to or upon the order of the Borrower or to whosoever may be
lawfully entitled to receive the same or as a court of competent jurisdiction may direct.



ARTICLE VIII.




The Agents and the Arrangers




     Each of the Lenders hereby irrevocably appoints each of the Administrative Agent and the
Collateral Agent (for purposes of this Article VIII, the Administrative Agent and the Collateral
Agent are referred to collectively as the “Agents”) its agent and authorizes the Agents to
take such actions on its behalf and to exercise such powers as are delegated to such Agent by the
terms of the Loan Documents, together with such actions and powers as are reasonably incidental
thereto. Without limiting the
generality of the foregoing, the Agents are hereby expressly authorized by the Lenders to
execute any and all documents (including releases and the Security Documents) with respect to the
Collateral and the rights of the Secured Parties with respect thereto, as contemplated by and in
accordance with the provisions of this Agreement and the Security Documents.



     Each bank serving as an Agent hereunder shall have the same rights and powers in its capacity
as a Lender as any other Lender and may exercise the same as though it were not an Agent, and such
bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of
business with the Borrower or any Subsidiary or any Affiliate thereof as if it were not an Agent
hereunder.



     No Agent shall have any duties or obligations except those expressly set forth in the Loan
Documents. Without limiting the generality of the foregoing, (a) no Agent shall be subject to any
fiduciary or other implied duties, regardless of whether a Default or an Event of Default has
occurred and is continuing, (b) no Agent shall have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers expressly contemplated
hereby that the Administrative Agent or the Collateral Agent is required to exercise as directed in
writing by the Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 9.08), and (c) except as expressly
set forth in the Loan Documents, no Agent shall have any duty to disclose, nor shall it be liable
for the failure to disclose, any information relating to the Borrower or any of the Subsidiaries
that is communicated to or obtained by the bank serving as any Agent or any of its Affiliates in
any capacity. The Administrative Agent and the Collateral Agent shall not be liable for any action
taken or not taken by it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the circumstances as provided in
Section 9.08), in each case, in the absence of its own gross negligence or willful misconduct. No



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Agent shall be deemed to have knowledge of any Default or Event of Default unless and until written
notice thereof is given to such Agent by the Borrower or a Lender, and no Agent shall be
responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with any Loan Document, (ii) the contents of any
certificate, report or other document delivered thereunder or in connection therewith, (iii) the
performance or observance of any of the covenants, agreements or other terms or conditions set
forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any
Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt
of items expressly required to be delivered to such Agent.




     Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or other writing
believed by it to be genuine and to have been signed or sent by the proper Person. Each Agent may
also rely upon any statement made to it orally or by telephone and believed by it to have been made
by the proper Person, and shall not incur any liability for relying thereon. Each Agent may
consult with legal counsel (who may be counsel for the Borrower), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.



     Each Agent may perform any and all of its duties and exercise its rights and powers by or
through any one or more sub-agents appointed by it. Each Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their respective Related
Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent
and to the Related Parties of each Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit facilities provided for
herein as well as activities as Agent.



     Subject to the appointment and acceptance of a successor Agent as provided below, each Agent
may resign at any time by notifying the Lenders and the Borrower. Upon any such resignation of the
Administrative Agent or the Collateral Agent, the Required Lenders shall have the right to appoint
a successor, subject to the Borrower’s approval (not to be unreasonably withheld or delayed) so
long as no Default or Event of Default shall have occurred and be continuing. If no successor
shall have been so appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation, then the retiring Agent
may, on behalf of the Lenders, appoint a successor Agent which shall be a bank with an office in
New York, New York, or an Affiliate of any such bank. Upon the acceptance of its appointment as
Agent hereunder by a successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the Borrower to a
successor Agent shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After an Agent’s resignation hereunder, the provisions of
this Article and Section 9.05 shall continue in effect for the benefit of such retiring Agent, its
sub-agents and their respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while acting as Agent.



     Each of the Syndication Agent and each Arranger, in its capacity as such, shall have no duties
or responsibilities, and shall incur no liability, under this Agreement or any other Loan Document.



     Each Lender acknowledges that it has, independently and without reliance upon the Agents, the
Arrangers, the Syndication Agent or any other Lender and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.
Each Lender also acknowledges that it will, independently and without reliance upon the Agents, the
Arrangers, the Syndication Agent or any other Lender and based on such documents and information as
it



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shall from time to time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement or any other Loan Document, any related agreement
or any document furnished hereunder or thereunder.




     To the extent required by any applicable law, the Administrative Agent may withhold from any
interest payment to any Lender an amount equivalent to any applicable withholding tax. If the
Internal Revenue Service or any other Governmental Authority asserts a claim that the
Administrative Agent did not properly withhold tax from amounts paid to or for the account of any
Lender because the appropriate form was not delivered or was not properly executed or because such
Lender failed to notify the Administrative Agent of a change in circumstance which rendered the
exemption from, or reduction of, withholding tax ineffective or for any other reason, such Lender
shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the
Administrative Agent as tax or otherwise, including any penalties or interest and together with all
expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred.



ARTICLE IX.




Miscellaneous




     SECTION 9.01. Notices. Notices and other communications provided for herein shall be in writing and
shall be delivered by hand or overnight courier service, mailed by certified or registered mail or
sent by fax, as follows:




     (a) if to the Borrower, to it at NRG Holdings, Inc. c/o NRG Energy, Inc., 211 Carnegie
Center, Princeton, NJ 08540, Attention of Treasurer, Chief Financial Officer and General
Counsel (Fax No. (609) 524-4501);




     (b) if to the Administrative Agent or the Collateral Agent, to Credit Suisse, 7200 Kit
Creek Road – Building 11, Raleigh, North Carolina 27709, Attention of Sean L. Portrait (Fax
No. (919) 994-6369; Email: sean.portrait@credit-suisse.com); and




     (c) if to a Lender, to it at its address (or fax number) set forth in the Lender
Addendum or the Assignment and Acceptance pursuant to which such Lender shall have become a
party hereto.


All notices and other communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the date of receipt if delivered by hand or
overnight courier service or sent by fax or on the date five Business Days after dispatch by
certified or registered mail if mailed, in each case delivered, sent or mailed (properly addressed)
to such party as provided in this Section 9.01 or in accordance with the latest unrevoked direction
from such party given in accordance with this Section 9.01.




     SECTION 9.02. Survival of Agreement. All covenants, agreements, representations and warranties made
by the Borrower herein and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the making by the Lenders of the Term Loans,
regardless of any investigation made by the Lenders or on their behalf, and shall continue in full
force and effect (but such representations and warranties shall be deemed made by the Borrower only
at such times and as of such dates as set forth in Section 4.01(b)) as long as the principal of or
any accrued interest on any Term Loan or any Fee or any other amount payable (other than
indemnification and other contingent obligations that are not then due and payable) under this
Agreement or any other Loan Document is



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outstanding and unpaid and so long as the Term Loan
Commitments have not been terminated. The provisions of Sections 2.14, 2.16, 2.20, 2.21 and 9.05
shall remain operative and in full force and effect regardless of the expiration of the term of
this Agreement, the consummation of the transactions contemplated hereby, the repayment of any of
the Term Loans, the expiration of the Term Loan Commitments, the invalidity or unenforceability of
any term or provision of this Agreement or any other Loan Document, or any investigation made by or
on behalf of the Administrative Agent, the Collateral Agent or any Lender.




     SECTION 9.03. Binding Effect. This Agreement shall become effective when it shall have been
executed by each of the parties hereto and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of the other parties
hereto.



     SECTION 9.04. Successors and Assigns. (a) Whenever in this Agreement any of the parties hereto
is referred to, such reference shall be deemed to include the permitted successors and assigns of
such party; and all covenants, promises and agreements by or on behalf of the Borrower, the
Administrative Agent, the Collateral Agent or the Lenders that are contained in this Agreement
shall bind and inure to the benefit of their respective successors and assigns.



     (b) Each Lender may assign to one or more assignees all or a portion of its interests, rights
and obligations under this Agreement (including all or a portion of its Term Loan Commitment and
the Term Loans at the time owing to it); provided, however, that (i)(x) except in
the case of an assignment of a Term Loan to a Lender or an Affiliate or Related Fund of a Lender,
each of the Administrative Agent and the Borrower must give its prior written consent to such
assignment (which consent in each case shall not be unreasonably withheld or delayed);
provided that the consent of the Borrower shall not be required for any assignment (1)
during the continuance of any Event of Default, (2) during the initial syndication of the Term
Loans and the Term Loan Commitments or (3) in the case of any assignment that is made after the
Funding Date and (y) except in the case of an assignment to a Lender or an Affiliate or Related
Fund of a Lender, the amount of the Term Loan Commitment or Term Loan of the assigning Lender
subject to each such assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall not be less than
$1,000,000 (or the entire remaining amount of such Lender’s Term Loan Commitment or Term Loans, as
the case may be and Related Funds shall be aggregated for this purpose), (ii) the parties to each
such assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance
(such Assignment and Acceptance to be (x) electronically executed and delivered to the
Administrative Agent via an electronic settlement system then acceptable to the Administrative
Agent, which shall initially be the settlement system of ClearPar, LLC, or (y) manually executed
and delivered) and (iii) the assignee, if it shall not be a Lender immediately prior to the
assignment, shall deliver to the Administrative Agent an Administrative Questionnaire. No Lender
is permitted to assign all or any portion of its interests, rights or obligations under this
Agreement (including all or a portion of its Term Loan Commitment and the Term Loans at any time
owing to it) except as specifically set forth in the immediately preceding sentence and any
purported assignment not in conformity therewith shall be null and void. Upon acceptance and
recording pursuant to paragraph (e) of this Section 9.04, from and after the effective date
specified in each Assignment and Acceptance, (A) the assignee thereunder shall be a party hereto
and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement and (B) the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the benefits and obligations
of Sections 2.14, 2.16, 2.20, 2.21 and 9.05, as well as to any Fees accrued for its account and not
yet paid). Notwithstanding the foregoing, an assignment by a Lender to one of its Affiliates or
Related Funds will be effective, valid, legal and binding without regard to



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whether the assignor
has delivered an Assignment and Acceptance or Administrative Questionnaire to the Administrative
Agent (and the acceptance and recordation thereof under paragraph (e) of this Section shall not be
required); provided that the Administrative Agent and the Borrower shall be entitled to
deal solely with the assignor unless and until the date that an Assignment and Acceptance and
Administrative Questionnaire have been delivered to the Administrative Agent with respect to the
applicable assignee.




     (c) By executing and delivering (to the Administrative Agent or the assigning Lender in the
case of an assignment by a Lender to one of its Affiliates or Related Funds pursuant to the last
sentence of paragraph (b) of this Section) an Assignment and Acceptance, the assigning Lender
thereunder and the assignee thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender warrants that it is the legal and
beneficial owner of the interest being assigned thereby free and clear of any adverse claim and
that its Term Loan Commitment, and the outstanding balances of its Term Loans without giving effect
to assignments thereof which have not become effective, are as set forth in such Assignment and
Acceptance, (ii) except as set forth in (i) above, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, any other Loan Document or any
other instrument or document furnished pursuant hereto, or the financial condition
of the Borrower or any Subsidiary or the performance or observance by the Borrower of any of
its obligations under this Agreement, any other Loan Document or any other instrument or document
furnished pursuant hereto; (iii) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; (iv) such assignee confirms that it has
received a copy of this Agreement, together with copies of the most recent financial statements
referred to in Section 3.05(a) or delivered pursuant to Section 5.04 and such other documents and
information as it has deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (v) such assignee will independently and without reliance upon the
Administrative Agent, the Collateral Agent, the Syndication Agent, the Arrangers such assigning
Lender or any other Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking action under this
Agreement; (vi) such assignee appoints and authorizes the Administrative Agent and the Collateral
Agent to take such action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to the Administrative Agent and the Collateral Agent, respectively, by the terms
hereof, together with such powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all the obligations which by the terms
of this Agreement are required to be performed by it as a Lender.



     (d) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices in the City of New York a copy of each Assignment and Acceptance
delivered to it and one or more registers for the recordation of the names and addresses of the
Lenders, and the Commitment of, and principal amount of the Term Loans owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in the
Register shall be conclusive absent manifest error and the Borrower, the Administrative Agent, the
Collateral Agent and the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for inspection by the
Borrower, the Collateral Agent and any Lender, at any reasonable time and from time to time upon
reasonable prior notice. In the case of any assignment made in accordance with the last sentence
of paragraph (b) of this Section that is not reflected in the Register, the assigning Lender shall
maintain a comparable register reflecting such assignment.



     (e) Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning
Lender and an assignee, an Administrative Questionnaire completed in respect of the assignee
(unless the assignee shall already be a Lender hereunder) and, if required, the written consent of
the



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Administrative Agent to such assignment, the Administrative Agent shall (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii)
give prompt notice thereof to the Lenders and the Borrower. No assignment shall be effective
unless it has been recorded in the Register as provided in this paragraph (e). Notwithstanding the
foregoing, an assignment by a Lender to an Affiliate or Related Fund pursuant to the last sentence
of paragraph (b) of this Section shall not be required to be recorded in the Register to be
effective; provided that (i) such assignment is recorded in a comparable register
maintained by the assignor as provided in paragraph (b) of this Section and (ii) the Administrative
Agent and the Borrower shall be entitled to deal solely and directly with the assignor unless and
until the date that an Assignment and Acceptance and Administrative Questionnaire have been
delivered to the Administrative Agent with respect to the applicable assignee.




     (f) Each Lender may without the consent of the Borrower or the Administrative Agent sell
participations to one or more banks or other entities in all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Term Loan Commitment and the
Term Loans owing to it); provided, however, that (i) such Lender’s obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to
the other parties hereto for the performance of such obligations, (iii) the participating banks or
other entities shall be entitled to the benefit of the cost protection provisions and related
obligations contained in Sections 2.14, 2.16, 2.20 and 2.21 to the same
extent as if they were Lenders (but, with respect to any particular participant, to no greater
extent than the Lender that sold the participation to such participant) and (iv) the Borrower, the
Administrative Agent and the Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Borrower relating to the Term Loans and to
approve any amendment, modification or waiver of any provision of this Agreement (other than
amendments, modifications or waivers decreasing any fees payable hereunder or the amount of
principal of or the rate at which interest is payable on the Term Loans, extending any scheduled
principal payment date or date fixed for the payment of interest on the Term Loans, increasing or
extending the Term Loan Commitments or releasing all or substantially all of the Collateral).



     (g) Any Lender or participant may, in connection with any assignment, pledge or participation
or proposed assignment, pledge or participation pursuant to this Section 9.04, disclose to the
assignee or participant or proposed assignee or participant any information relating to the
Borrower furnished to such Lender by or on behalf of the Borrower; provided that, prior to
any such disclosure of information designated by the Borrower as confidential, each such assignee
or participant or proposed assignee or participant shall execute an agreement whereby such assignee
or participant shall agree (subject to customary exceptions) to preserve the confidentiality of
such confidential information on terms no less restrictive than those applicable to the Lenders
pursuant to Section 9.16.



     (h) Any Lender may, without the consent of the Borrower or the Administrative Agent, at any
time assign all or any portion of its rights under this Agreement to secure extensions of credit to
such Lender or in support of obligations owed by such Lender, and, in the case of any Lender that
is a fund that invests in bank loans, such Lender may collaterally assign all or any portion of its
rights under this Agreement to any holder of, trustee for, or other representative of any holders
of, obligations owed or securities issued by such fund as security for such obligations or
securities; provided that no such assignment described in this clause (h) shall release a
Lender from any of its obligations hereunder or substitute any such assignee for such Lender as a
party hereto.



     (i) Notwithstanding anything to the contrary contained herein, any Lender (a “Granting
Lender”) may grant to a special purpose funding vehicle (an “SPC”), identified as such
in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower,
the option to provide to the Borrower all or any part of any Term Loan that such Granting Lender
would otherwise be obligated



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to make to the Borrower pursuant to this Agreement; provided
that (i) nothing herein shall constitute a commitment by any SPC to make any Term Loan and (ii) if
an SPC elects not to exercise such option or otherwise fails to provide all or any part of such
Term Loan, the Granting Lender shall be obligated to make such Term Loan pursuant to the terms
hereof. The making of a Term Loan by an SPC hereunder shall utilize the Term Loan Commitment of
the Granting Lender to the same extent, and as if, such Term Loan were made by such Granting
Lender. Each party hereto hereby agrees that no SPC shall be liable for any indemnity or similar
payment obligation under this Agreement (all liability for which shall remain with the Granting
Lender). In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall
survive the termination of this Agreement) that, prior to the date that is one year and one day
after the payment in full of all outstanding commercial paper or other senior indebtedness of any
SPC, it will not institute against, or join any other Person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of
the United States or any State thereof. In addition, notwithstanding anything to the contrary
contained in this Section 9.04, any SPC may (i) with notice to, but without the prior written
consent of, the Borrower and the Administrative Agent and without paying any processing fee
therefor, assign all or a portion of its interests in any Term Loans to the Granting Lender or to
any financial institutions (consented to by the Borrower and Administrative Agent) providing
liquidity and/or credit support to or for the account of such SPC to support the funding or
maintenance of Term Loans and (ii) disclose on a confidential basis
any non-public information relating to its Term Loans to any rating agency, commercial paper
dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC.




     (j) No Borrower shall assign or delegate any of its rights or duties hereunder without the
prior written consent of the Administrative Agent and each Lender, and any attempted assignment
without such consent shall be null and void.



     SECTION 9.05. Expenses; Indemnity. (a) The Borrower agrees to pay all reasonable and
documented out-of-pocket expenses incurred by the Administrative Agent, the Collateral Agent, the
Syndication Agent and the Arrangers, including the reasonable fees, charges and disbursements of
Latham & Watkins LLP, counsel for the Administrative Agent and the Collateral Agent, in connection
with the syndication of the credit facilities provided for herein and the preparation and
administration of this Agreement and the other Loan Documents or in connection with any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the transactions
hereby or thereby contemplated shall be consummated); provided that the Borrower shall not
be responsible for the reasonable fees, charges and disbursements of more than one separate law
firm (in addition to one local counsel per relevant jurisdiction or special counsel, including
special workout or regulatory counsel) pursuant to its obligations under this sentence only. The
Borrower also agrees to pay all documented out-of-pocket expenses incurred by the Administrative
Agent, the Collateral Agent, the Syndication Agent, the Arrangers or any Lender in connection with
the enforcement or protection of its rights in connection with this Agreement and the other Loan
Documents or in connection with the Term Loans made hereunder, including the fees, charges and
disbursements of Latham & Watkins LLP, counsel for the Administrative Agent and the Collateral
Agent, and, in connection with any such enforcement or protection, the fees, charges and
disbursements of any other counsel (including special workout counsel) for the Administrative
Agent, the Collateral Agent, the Syndication Agent, the Arrangers or any Lender.



     (b) The Borrower agrees to indemnify the Administrative Agent, the Collateral Agent, the
Syndication Agent, the Arrangers, each Lender and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and to hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses,
including reasonable and documented counsel fees, charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in any way connected with, or as a result of (i)
the execution or delivery of this Agreement or any other Loan Document or any agreement or
instrument contemplated thereby, the performance by the parties



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thereto of their respective
obligations thereunder or the consummation of the Transactions and the other transactions
contemplated thereby, (ii) the use of the proceeds of the Term Loans, (iii) any claim, litigation,
investigation or proceeding relating to any of the foregoing, whether or not any Indemnitee is a
party thereto, or (iv) any actual or alleged presence or Release of Hazardous Materials, or any
non-compliance with Environmental Law, on any property owned or operated by the Borrower or any of
the Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of the
Subsidiaries; provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee, or except to the extent such dispute is
between Indemnitees (other than any dispute between an Indemnitee in its capacity as an Arranger or
Agent and other Indemnitee as a Lender).




     (c) To the extent that the Borrower fails to pay any amount required to be paid by them to the
Administrative Agent, the Collateral Agent, the Syndication Agent or the Arrangers under paragraph
(a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent, the
Collateral
Agent, the Syndication Agent or the Arrangers, as the case may be, such Lender’s pro rata
share (determined as of the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent, the Collateral Agent, the Syndication Agent or the Arrangers in
its capacity as such. For purposes hereof, a Lender’s “pro rata share” shall be determined based
upon its share of the sum of the outstanding Term Loans and unused Term Loan Commitments at the
time.



     (d) To the extent permitted by applicable law, the Borrower shall not assert, and it hereby
waives, any claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Term Loan or the use of the proceeds thereof.



     (e) The provisions of this Section 9.05 shall remain operative and in full force and effect
regardless of the expiration of the term of this Agreement, the consummation of the transactions
contemplated hereby, the repayment of any of the Term Loans, the expiration of the Term Loan
Commitments, the invalidity or unenforceability of any term or provision of this Agreement or any
other Loan Document, or any investigation made by or on behalf of the Administrative Agent, the
Collateral Agent, the Syndication Agent, the Arrangers or any Lender. All amounts due under this
Section 9.05 shall be payable promptly upon written demand therefor.



     SECTION 9.06. Right of Setoff. If an Event of Default shall have occurred and be continuing, each
Lender is hereby authorized at any time and from time to time, except to the extent prohibited by
law, to set off and apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by such Lender to or for the
credit or the account of the Borrower against any of and all the obligations of the Borrower now or
hereafter existing under this Agreement and other Loan Documents held by such Lender, irrespective
of whether or not such Lender shall have made any demand under this Agreement or such other Loan
Document and although such obligations may be unmatured. The rights of each Lender under this
Section 9.06 are in addition to other rights and remedies (including other rights of setoff) which
such Lender may have.



     SECTION 9.07. Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.



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     SECTION 9.08. Waivers; Amendment; Replacement of Non-Consenting Lenders. (a) No failure or
delay of the Administrative Agent, the Collateral Agent or any Lender in exercising any power or
right hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Administrative Agent, the
Collateral Agent and the Lenders hereunder and under the other Loan Documents are cumulative and
are not exclusive of any rights or remedies that they would otherwise have. No waiver of any
provision of this Agreement or any other Loan Document or consent to any departure by the Borrower
or any other Loan Party therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the
specific instance and for the purpose
for which given. No notice or demand on the Borrower in any case shall entitle the Borrower
to any other or further notice or demand in similar or other circumstances.



     (b) Neither this Agreement nor any other Loan Document nor any provision thereof may be
waived, amended or modified except pursuant to an agreement or agreements in writing entered into
by the Borrower and the Required Lenders; provided, however, that (A)
notwithstanding the foregoing, the Administrative Agent, acting in its sole discretion, and the
Borrower may (without the consent of any Lender) amend or supplement this Agreement and the other
Loan Documents to cure any ambiguity, defect or inconsistency or to make a modification of a minor
or technical nature or to correct a manifest error and (B) no such agreement described above in
this paragraph (b) shall (i) decrease or forgive the principal amount of, or extend the maturity of
or any scheduled principal payment date or date for the payment of any interest on any Term Loan,
or waive or excuse any such payment or any part thereof, or decrease the rate of interest on any
Term Loan, without the prior written consent of each Lender directly affected thereby, (ii)
increase or extend the Term Loan Commitment or decrease or extend the date for payment of any Fees
of any Lender without the prior written consent of such Lender, (iii) amend or modify the pro rata
requirements of Section 2.17, the provisions of Sections 2.02, 2.09 and 2.18 requiring ratable
distribution or sharing or ratable funding, the provisions of Section 9.04(j), the provisions of
this Section or the definition of the term “Required Lenders” without the prior written consent of
each Lender, (iv) except upon payment in full of the obligations hereunder (except for contingent
obligations or indemnities not yet accrued as of such time), release all or substantially all of
the Collateral, except in connection with a disposition expressly permitted under the Loan
Documents, without the prior written consent of each Lender or (v) modify the protections afforded
to an SPC pursuant to the provisions of Section 9.04(i) without the written consent of such SPC;
provided further that no such agreement shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent or the Collateral Agent hereunder or under any other
Loan Document without the prior written consent of the Administrative Agent or the Collateral
Agent, as applicable.



     (c) Each Lender grants (i) to the Administrative Agent the right (with the prior written
consent of the Borrower) to purchase all of such Lender’s Term Loan Commitments and Term Loans
owing to it and any related promissory notes held by it and all its rights and obligations
hereunder and under the other Loan Documents and (ii) to the Borrower the right to cause an
assignment of all of such Lender’s Term Loan Commitments and Term Loans owing to it and any related
promissory notes held by it and all its rights and obligations hereunder and under the other Loan
Documents to one or more eligible assignees pursuant to Section 9.04, which right may be exercised
by the Administrative Agent or the Borrower, as the case may be, if such Lender (a
“Non-Consenting Lender”) refuses to execute any amendment, modification, termination,
waiver or consent which requires the written consent of Lenders other than the Required Lenders and
to which the Required Lenders and the Borrower have otherwise agreed; provided that such
Non-Consenting Lender shall receive in connection with such purchase or assignment, payment equal
to the aggregate amount of outstanding Term Loans owed to such Lender, together with all accrued
and unpaid interest, fees and other amounts (other than indemnification and



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other contingent
obligations not yet due and payable) owed to such Lender under the Loan Documents at such time; and
provided, further, that any such assignee shall agree to such amendment,
modification, termination, waiver or consent. Each Lender agrees that if the Administrative Agent
or the Borrower, as the case may be, exercises its option under this paragraph it shall promptly
execute and deliver all agreements and documentation necessary to effectuate such assignment as set
forth in Section 9.04. The Borrower shall be entitled (but not obligated) to execute and deliver
such agreements and documentation on behalf of such Non-Consenting Lender and any such agreements
or documentation so executed by the Borrower shall be effective for all purposes of documenting an
assignment pursuant to Section 9.04.




     SECTION 9.09. Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate
applicable to any Term Loan, together with all fees, charges and other amounts which are treated as
interest on such Term Loan under applicable law (collectively the “Charges”), shall exceed
the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Term Loan in accordance with applicable law, the
rate of interest payable in respect of such Term Loan hereunder, together with all Charges payable
in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Term Loan but were not payable as a
result of the operation of this Section 9.09 shall be cumulated and the interest and Charges
payable to such Lender in respect of other Term Loans or periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the
Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.



     SECTION 9.10. Entire Agreement. This Agreement, the Commitment Letter, the Fee Letter and the other
Loan Documents constitute the entire contract between the parties relative to the subject matter
hereof. Any other previous agreement among the parties with respect to the subject matter hereof
is superseded by this Agreement and the other Loan Documents. Nothing in this Agreement or in the
other Loan Documents, expressed or implied, is intended to confer upon any Person (other than the
parties hereto and thereto, their respective successors and assigns permitted hereunder and, to the
extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the
Collateral Agent, the Syndication Agent, the Arrangers and the Lenders) any rights, remedies,
obligations or liabilities under or by reason of this Agreement or the other Loan Documents.



     SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE
OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS,
AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.



     SECTION 9.12. Severability. In the event any one or more of the provisions contained in this
Agreement or in any other Loan Document should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions contained herein and
therein shall not in any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect
the validity of such provision in any other jurisdiction). The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or



107









 




unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that of the invalid, illegal
or unenforceable provisions.




     SECTION 9.13. Counterparts. This Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original but all of which when taken
together shall constitute a single contract, and shall become effective as provided in Section
9.03. Delivery of an executed signature page to this Agreement or of a Lender Addendum by
facsimile transmission shall be as effective as delivery of a manually signed counterpart of this
Agreement.



     SECTION 9.14. Headings. Article and Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Agreement and are not to affect the
construction of, or to be taken into consideration in interpreting, this Agreement.



     SECTION 9.15. Jurisdiction; Consent to Service of Process. (a) The Borrower hereby irrevocably
and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any
New York State court or Federal court of the United States of America sitting in New York City, and
any appellate court from any thereof, in any action or proceeding arising out of or relating to
this Agreement or the other Loan Documents, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect
of any such action or proceeding may be heard and determined in such New York State or, to the
extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that the Administrative Agent, the Collateral Agent, the
Syndication Agent, the Arrangers or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or the other Loan Documents against the Borrower or its properties in
the courts of any jurisdiction.



     (b) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have to the laying of
venue of any suit, action or proceeding arising out of or relating to this Agreement or the other
Loan Documents in any New York State or Federal court. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance of such action or proceeding in any such court.



     (c) Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 9.01. Nothing in this Agreement will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.



     SECTION 9.16. Confidentiality. Each of the Administrative Agent, the Collateral Agent and the
Lenders agrees to maintain the confidentiality of the Information, except that Information may be
disclosed (a) to its and its Affiliates’ officers, directors, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such Information and instructed
to keep such Information confidential), (b) to the extent requested by any regulatory authority or
quasi-regulatory authority (such as the National Association of Insurance Commissioners), (c) to
the extent required by Applicable Laws or by any subpoena or similar legal process, (d) in
connection with the exercise of any remedies hereunder or under the other Loan Documents or any
suit, action or proceeding relating to the enforcement of its rights hereunder or thereunder, (e)
subject to an agreement containing provisions substantially the same as those of this
Section 9.16, to (i) any actual or prospective assignee of or participant in any of its rights
or obligations under this Agreement and the other Loan Documents, (ii) any pledgee referred to in
Section



108









 




9.04(g) or (iii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrower or any Subsidiary or any of their respective
obligations, (f) with the consent of the Borrower or (g) to the extent such Information becomes
publicly available other than as a result of a breach of this Section 9.16. For the purposes of
this Section, “Information” shall mean all financial statements, certificates, reports,
agreements and other information received from the Borrower or its Subsidiaries and related to the
Borrower or its business, other than any such financial statements, certificates, reports,
agreements and other information that was available to the Administrative Agent, the Collateral
Agent or any Lender on a nonconfidential basis prior to its disclosure by the Borrower;
provided that, in the case of Information received from the Borrower after the Closing
Date, such information is clearly identified at the time of delivery as confidential. Any Person
required to maintain the confidentiality of Information as provided in this Section 9.16 shall be
considered to have complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such Person would accord its
own confidential information. Notwithstanding any other express or implied agreement, arrangement
or understanding to the contrary, each of the parties hereto agrees that each other party hereto
(and each of its employees, representatives or agents) are permitted to disclose to any Persons,
without limitation, the tax treatment and tax structure of the Term Loans and the other
transactions contemplated by the Loan Documents and all materials of any kind (including opinions
and tax analyses) that are provided to the Loan Parties, the Lenders, the Arrangers or any Agent
related to such tax treatment and tax aspects. To the extent not inconsistent with the immediately
preceding sentence, this authorization does not extend to disclosure of any other information or
any other term or detail not related to the tax treatment or tax aspects of the Term Loans or the
transactions contemplated by the Loan Documents.




     SECTION 9.17. Delivery of Lender Addenda. Each initial Lender shall become a party to this Agreement by
delivering to the Administrative Agent a Lender Addendum duly executed by such Lender, the Borrower
and the Administrative Agent.



     SECTION 9.18. Holdings Reorganization. The Lenders hereby further agree that nothing in this Agreement
or the other Loan Documents shall prohibit or restrict (including as a result of a Change of
Control) the Borrower or any of its Subsidiaries from entering into and consummating the Holdings
Reorganization and the Holdings Contribution.



109









 





     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by
their respective authorized officers as of the day and year first above written.



	 	 	 	 	 
	 	NRG HOLDINGS, INC.

 	 
	 	By:  	/s/ Clint Freeland
 	 
	 	 	Name:  	Clint Freeland 	 
	 	 	Title:  	Treasurer 	 
	 














 





	 	 	 	 	 
	 	CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as

Administrative Agent and Collateral Agent

 	 
	 	By:  	/s/ James Moran
 	 
	 	 	Name:  	James Moran 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                                /s/ Nupur Kumar
 	 
	 	 	Name:  	Nupur Kumar 	 
	 	 	Title:  	Associate 	 
	 














 





	 	 	 	 	 
	 	CITIGROUP GLOBAL MARKETS INC., as 

Joint Book Runner
and Joint Lead Arranger
 	 
	 	By:  	/s/ Dave R. Goncher
 	 
	 	 	Name:  	Dave R. Goncher 	 
	 	 	Title:  	Director 	 
	 



	 	 	 	 	 
	 	CITICORP NORTH AMERICA INC., as 

Syndication Agent
 	 
	 	By:  	/s/ Dave R. Goncher
 	 
	 	 	Name:  	Dave R. Goncher 	 
	 	 	Title:  	Director