Document:

exv10w25

 

EXHIBIT 10.25

EXECUTION COPY

CREDIT AGREEMENT

dated as of December 23, 2003

as amended and restated as of

December 24, 2004

among

NRG ENERGY, INC.,

NRG POWER MARKETING INC.,

THE LENDERS PARTY HERETO

and

CREDIT SUISSE FIRST BOSTON,

as Administrative Agent

CREDIT SUISSE FIRST BOSTON

and

GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Joint Lead Book Runners, Joint Lead Arrangers and Co-Documentation Agents

GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Syndication Agent

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	ARTICLE I.
	 	 	 	 
	 
	 	 	 	 
	Definitions
	 	 	 	 
	 
	 	 	 	 
	SECTION 1.01. Defined Terms
	 	 	2	 
	SECTION 1.02. Terms Generally
	 	 	46	 
	SECTION 1.03. Classification of Loans and Borrowings
	 	 	46	 
	SECTION 1.04. Pro Forma Calculations
	 	 	46	 
	 
	 	 	 	 
	ARTICLE II.
	 	 	 	 
	 
	 	 	 	 
	The Credits
	 	 	 	 
	 
	 	 	 	 
	SECTION 2.01. Commitments
	 	 	47	 
	SECTION 2.02. Loans
	 	 	47	 
	SECTION 2.03. Borrowing Procedure
	 	 	49	 
	SECTION 2.04. Repayment of Loans; Evidence of Debt
	 	 	50	 
	SECTION 2.05. Fees
	 	 	51	 
	SECTION 2.06. Interest on Loans
	 	 	53	 
	SECTION 2.07. Default Interest
	 	 	53	 
	SECTION 2.08. Alternate Rate of Interest
	 	 	53	 
	SECTION 2.09. Termination and Reduction of Commitments; Return,
Reduction and Conversion of Credit-Linked Deposits
	 	 	54	 
	SECTION 2.10. Conversion and Continuation of Borrowings
	 	 	55	 
	SECTION 2.11. Repayment of Term Borrowings
	 	 	56	 
	SECTION 2.12. Prepayment
	 	 	58	 
	SECTION 2.13. Mandatory Prepayments
	 	 	58	 
	SECTION 2.14. Reserve Requirements; Change in Circumstances
	 	 	60	 
	SECTION 2.15. Change in Legality
	 	 	62	 
	SECTION 2.16. Indemnity
	 	 	62	 
	SECTION 2.17. Pro Rata Treatment
	 	 	63	 
	SECTION 2.18. Sharing of Setoffs
	 	 	63	 
	SECTION 2.19. Payments
	 	 	64	 
	SECTION 2.20. Taxes
	 	 	64	 
	SECTION 2.21. Assignment of Commitments Under Certain Circumstances;
Duty to Mitigate
	 	 	66	 
	SECTION 2.22. Swingline Loans
	 	 	67	 
	SECTION 2.23. Letters of Credit
	 	 	68	 
	SECTION 2.24. Credit-Linked Deposit Account
	 	 	74	 
	 
	 	 	 	 
	ARTICLE III.
	 	 	 	 

 

 

	 	 	 	 	 
	 	 	PAGE	 
	Representations and Warranties
	 	 	 	 
	 
	 	 	 	 
	SECTION 3.01. Organization; Powers
	 	 	75	 
	SECTION 3.02. Authorization; No Conflicts
	 	 	75	 
	SECTION 3.03. Enforceability
	 	 	75	 
	SECTION 3.04. Governmental Approvals
	 	 	75	 
	SECTION 3.05. Financial Statements
	 	 	76	 
	SECTION 3.06. No Material Adverse Change
	 	 	76	 
	SECTION 3.07. Title to Properties; Possession Under Leases
	 	 	76	 
	SECTION 3.08. Subsidiaries
	 	 	77	 
	SECTION 3.09. Litigation; Compliance with Laws
	 	 	77	 
	SECTION 3.10. Agreements
	 	 	78	 
	SECTION 3.11. Federal Reserve Regulations
	 	 	78	 
	SECTION 3.12. Investment Company Act
	 	 	78	 
	SECTION 3.13. Use of Proceeds
	 	 	78	 
	SECTION 3.14. Tax Returns
	 	 	79	 
	SECTION 3.15. No Material Misstatements
	 	 	79	 
	SECTION 3.16. Employee Benefit Plans
	 	 	79	 
	SECTION 3.17. Environmental Matters
	 	 	79	 
	SECTION 3.18. Insurance
	 	 	80	 
	SECTION 3.19. Security Documents
	 	 	81	 
	SECTION 3.20. Location of Real Property
	 	 	81	 
	SECTION 3.21. Labor Matters
	 	 	82	 
	SECTION 3.22. Intellectual Property
	 	 	82	 
	SECTION 3.23. Energy Regulation
	 	 	82	 
	SECTION 3.24. Solvency
	 	 	83	 
	 
	 	 	 	 
	ARTICLE IV.
	 	 	 	 
	 
	 	 	 	 
	Conditions of Lending
	 	 	 	 
	 
	 	 	 	 
	SECTION 4.01. All Credit Events
	 	 	83	 
	SECTION 4.02. Conditions Precedent to Restatement Date
	 	 	84	 
	 
	 	 	 	 
	ARTICLE V.
	 	 	 	 
	 
	 	 	 	 
	Affirmative Covenants
	 	 	 	 
	 
	 	 	 	 
	SECTION 5.01. Corporate Existence
	 	 	88	 
	SECTION 5.02. Insurance
	 	 	88	 
	SECTION 5.03. Taxes
	 	 	88	 
	SECTION 5.04. Financial Statements, Reports, etc
	 	 	88	 
	SECTION 5.05. Litigation and Other Notices
	 	 	90	 
	SECTION 5.06. Information Regarding Collateral
	 	 	90	 

ii

 

	 	 	 	 	 
	 	 	PAGE	 
	SECTION 5.07. Maintaining Records; Access to Properties and
Inspections;
Environmental Assessments
	 	 	91	 
	SECTION 5.08. Use of Proceeds
	 	 	92	 
	SECTION 5.09. Additional Collateral, etc
	 	 	92	 
	SECTION 5.10. Further Assurances
	 	 	94	 
	 
	 	 	 	 
	ARTICLE VI.
	 	 	 	 
	 
	 	 	 	 
	Negative Covenants
	 	 	 	 
	 
	 	 	 	 
	SECTION 6.01. Indebtedness and Preferred Stock
	 	 	95	 
	SECTION 6.02. Liens
	 	 	98	 
	SECTION 6.03. Limitation on Sale and Leaseback Transactions
	 	 	98	 
	SECTION 6.04. Mergers, Consolidations and Sales of Assets
	 	 	99	 
	SECTION 6.05. Restricted Payments; Restrictive Agreements
	 	 	100	 
	SECTION 6.06. Transactions with Affiliates
	 	 	106	 
	SECTION 6.07. Business Activities
	 	 	107	 
	SECTION 6.08. Other Indebtedness and Agreements
	 	 	108	 
	SECTION 6.09. Designation of Restricted and Unrestricted Subsidiaries
	 	 	108	 
	SECTION 6.10. Consolidated Interest Coverage Ratio
	 	 	108	 
	SECTION 6.11. Consolidated Leverage Ratio
	 	 	108	 
	SECTION 6.12. Fiscal Year
	 	 	108	 
	 
	 	 	 	 
	ARTICLE VII.
	 	 	 	 
	 
	 	 	 	 
	Events of Default
	 	 	 	 
	 
	 	 	 	 
	ARTICLE VIII.
	 	 	 	 
	 
	 	 	 	 
	The Agents and the Arrangers
	 	 	 	 
	 
	 	 	 	 
	ARTICLE IX.
	 	 	 	 
	 
	 	 	 	 
	Miscellaneous
	 	 	 	 
	 
	 	 	 	 
	SECTION 9.01. Notices
	 	 	114	 
	SECTION 9.02. Survival of Agreement
	 	 	115	 
	SECTION 9.03. Binding Effect
	 	 	115	 
	SECTION 9.04. Successors and Assigns
	 	 	115	 
	SECTION 9.05. Expenses; Indemnity
	 	 	119	 
	SECTION 9.06. Right of Setoff
	 	 	121	 
	SECTION 9.07. Applicable Law
	 	 	121	 
	SECTION 9.08. Waivers; Amendment; Replacement of Non-Consenting
Lenders
	 	 	121	 
	SECTION 9.09. Interest Rate Limitation
	 	 	123	 

iii

 

	 	 	 	 	 
	SECTION 9.10. Entire Agreement
	 	 	123	 
	SECTION 9.11. WAIVER OF JURY TRIAL
	 	 	124	 
	SECTION 9.12. Severability
	 	 	124	 
	SECTION 9.13. Counterparts
	 	 	124	 
	SECTION 9.14. Headings
	 	 	124	 
	SECTION 9.15. Jurisdiction; Consent to Service of Process
	 	 	124	 
	SECTION 9.16. Confidentiality
	 	 	125	 
	SECTION 9.17. Joint and Several Liability; Postponement of Subrogation
	 	 	126	 
	SECTION 9.18. Delivery of Lender Addenda
	 	 	126	 

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 Trust Agreement
	Exhibit F

	 	Form of Guarantee and Collateral Agreement
	Exhibit G

	 	Form of Lender Addendum
	Exhibit H

	 	Form of Mortgage
	Exhibit I

	 	NRG Plan
	Exhibit J

	 	Form of Omnibus Assignment
	Exhibit K

	 	Form of Perfection Certificate
	Exhibit L

	 	Form of Revolving Note
	Exhibit M

	 	Form of Term Note
	Exhibit N

	 	Form of Opinion of Skadden, Arps, Slate, Meagher & Flom LLP
	 
	 	 
	Schedule 1.01(a)

	 	Excluded Foreign Subsidiaries
	Schedule 1.01(b)

	 	Excluded Project Subsidiaries
	Schedule 1.01(c)

	 	Existing Letters of Credit
	Schedule 1.01(d)

	 	Existing Non-Recourse Indebtedness
	Schedule 1.01(e)

	 	Immaterial Subsidiaries
	Schedule 1.01(f)

	 	Mortgaged Properties
	Schedule 1.01(g)

	 	Specified Assets Held for Sale
	Schedule 1.01(h)

	 	Subsidiary Guarantors
	Schedule 3.07

	 	Properties
	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 3.20

	 	Owned and Leased Real Property

iv

 

	 	 	 
	Schedule 5.09(b)

	 	Title Insurance and Survey Requirements
	Schedule 6.01

	 	Existing Indebtedness
	Schedule 6.02

	 	Existing Liens

v

 

     CREDIT AGREEMENT dated as of December 23, 2003, as amended and restated as of December
24, 2004 (this “Agreement”), among NRG ENERGY, INC., a Delaware corporation (the
“Company”), NRG POWER MARKETING INC., a Delaware corporation (“NRG Power
Marketing”), the LENDERS from time to time party hereto, CREDIT SUISSE FIRST BOSTON and GOLDMAN
SACHS CREDIT PARTNERS L.P., as joint lead book runners and joint lead arrangers (in such
capacities, collectively, the “Arrangers”) and as co-documentation agents (in such
capacities, collectively, the “Co-Documentation Agents”), CREDIT SUISSE FIRST BOSTON, 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 GOLDMAN SACHS CREDIT PARTNERS L.P., as syndication agent (in such
capacity, the “Syndication Agent”).

     A. On the Closing Date, the Borrowers, the Administrative Agent and certain of the Lenders
entered into the Original Credit Agreement pursuant to which certain of the Lenders agreed to
extend credit to the Borrowers on a revolving credit basis and/or to make term loans and/or
credit-linked deposits to the Term Loan Borrower.

     B. On the Restatement Date, (a) this Agreement will be amended and restated in the form hereof
and (b) all loans outstanding under the Original Credit Agreement will be assigned in their
entirety to the Lenders under this Agreement, as amended and restated, and the Commitments (as
defined in the Original Credit Agreement) of such assigning Lenders will be assigned to the Lenders
under this Agreement, as amended and restated, and thereafter continue as and be deemed to be the
Commitments hereunder.

     C. The Borrowers have requested the Lenders to continue to extend credit hereunder in the form
of (a) Term Loans to be re-evidenced on the Restatement Date in an aggregate principal amount of
$450,000,000, (b) Credit-Linked Deposits to be re-evidenced on the Restatement Date in an aggregate
principal amount of $350,000,000 and (c) Revolving Loans, Revolving Letters of Credit and Swingline
Loans to be re-evidenced, made or issued at any time and from time to time on or after the
Restatement Date and prior to the Revolving Credit Maturity Date in an aggregate principal and face
amount at any time outstanding not to exceed $150,000,000 (subject to the limitations set forth
herein).

     D. The proceeds of the Term Loans, Credit-Linked Deposits and Revolving Loans re-evidenced or
made, as the case may be, on the Restatement Date will be used to (a) repay or return, as
applicable, all amounts due or outstanding under the Original Credit Agreement on the Restatement
Date to those assigning Lenders who thereafter are not Lenders on the Restatement Date and (b) pay
fees and expenses incurred in connection therewith.

     E. The Lenders are willing to continue to extend such credit and the Issuing Bank is willing
to continue to issue Letters of Credit on the terms and subject to the conditions set forth herein.
As a result of the foregoing, the Lenders on the Restatement Date shall be the owners and holders,
by assignment or otherwise, of the loans outstanding under the Original Credit Agreement
immediately prior to the Restatement Date. Accordingly, in consideration of the mutual agreements
contained herein and other good and valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, the parties hereto agree that this Agreement shall,

 

 

upon satisfaction (or waiver in accordance with Section 9.08) of the conditions set forth in
Section 4.02, be amended and restated to read in its entirety 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 Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to
the Alternate Base Rate.

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

     “Acquired Debt” shall mean, with respect to any specified Person, (a) Indebtedness of
any other Person existing at the time such other Person is merged with or into or became a
subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection
with, or in contemplation of, such other Person merging with or into, or becoming a subsidiary of
such specified Person; and (b) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.

     “Additional Non-Recourse Indebtedness” shall mean secured Indebtedness for borrowed
money of a Subsidiary that is not a Loan Party as of the Restatement Date (so long as such
Subsidiary does not become (and remain for a period of 365 days or more) a Subsidiary Guarantor
after the Restatement Date), or a Subsidiary that becomes a Subsidiary after the Restatement Date,
that is incurred to finance the development, construction or acquisition by such Subsidiary of a
power generation facility (or a power transmission, distribution, fuel supply or fuel
transportation facility), which facility in each case either does not exist as of the Restatement
Date (and in respect of which no development or construction thereof has taken place as of the
Restatement Date) or is owned by a Person other than the Company or an Affiliate of the Company as
of the Restatement Date, and fixed or capital assets related thereto; provided that (a)
such Indebtedness is without recourse to the Company or any other Subsidiary or to any property or
assets of the Company or any other Subsidiary (other than, in each such case, another Subsidiary
(x) which is the direct parent or a direct or indirect Subsidiary of the Subsidiary that incurred
or issued such Indebtedness (other than any such Indebtedness constituting a Guarantee) or (y) that
is a Subsidiary that itself has Non-Recourse Indebtedness (other than any 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 any such Indebtedness constituting
a Guarantee)), (b) neither the Company nor any other Subsidiary (other than another Subsidiary (x)
which is the direct parent or a direct or indirect Subsidiary of the Subsidiary that incurred or
issued such Indebtedness (other than any such Indebtedness constituting a Guarantee) or (y) that is
a Subsidiary that itself has Non-Recourse Indebtedness (other than any 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 any
such Indebtedness constituting a Guarantee)) provides credit support of any kind (including any

2

 

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 to support obligations of such applicable subsidiary and (ii) any investments in
such applicable subsidiary made in accordance with Section 6.05), (c) neither the Company nor any
other Subsidiary or Affiliate of any thereof constitutes the lender of such Indebtedness, (d) 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 that is not a Loan Party)
would permit upon notice, lapse of time or both any holder of any other Indebtedness of the Company
or any other Loan Party (other than Indebtedness incurred pursuant to Section 6.01(b)(i), (ii),
(iii), (xi) and any Permitted Refinancing Indebtedness incurred to refund, refinance, replace,
defease or discharge any Indebtedness incurred pursuant to Section 6.01(b)(ii), (iii) or (xi)) 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, (e) the Liens securing such Indebtedness shall
exist only on (i) the property and assets of any Subsidiary that is not a Loan Party and (ii) the
Equity Interests in any Subsidiary that is not a Loan Party (and shall not apply to any other
property or assets of the Company or any other Subsidiary that is a Loan Party) and (f) the lenders
of such Indebtedness have been notified in writing that they will not have any recourse to the
stock or assets of the Company or any other Loan Party, except, in the case of each of clauses (a),
(b) and (f) for (x) agreements of the Company or any other Subsidiary to provide corporate or
management services or operation and maintenance services to such Subsidiary, (y) Guarantees of the
Company or any other Subsidiary 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 to make capital
contributions to such Subsidiary, in the case of each of clauses (x), (y) and (z), which are
otherwise permitted hereunder.

     “Additional Notes” shall mean additional Senior Notes (other than the first
$1,250,000,000 aggregate principal amount of Senior Notes issued under the Senior Note Documents on
December 23, 2003) issued under the Senior Note Documents in accordance with the terms thereof and
Section 6.01 hereof, as part of the same series as such Senior Notes issued on December 23, 2003.

     “Adjusted Excess Cash Flow” shall mean, for any fiscal year of the Company, Excess
Cash Flow for such fiscal year minus $25,000,000.

     “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).

3

 

     “Administrative Questionnaire” shall mean an Administrative Questionnaire in the form
of Exhibit A, or such other 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 and the definition of the term “subsidiary”, “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 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 any Loan
Party to a Person that is not a Loan Party are required to be subordinated to the Secured
Obligations hereunder pursuant to Section 6.01(b)(vi).

     “Affiliate Transaction” shall have the meaning assigned to such term in Section 6.06.

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

     “Aggregate Revolving Credit Exposure” shall mean the aggregate amount of the Lenders’
Revolving Credit Exposures.

     “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 Margin” shall mean, for any day, for each Type of Loan, the rate per annum
set forth under the relevant column heading below:

	 	 	 	 	 	 	 	 	 
	 	 	ABR Loans	 	 	Eurodollar Loans	 
	Revolving Loans and Swingline Loans
	 	 	1.50	%	 	 	2.50	%
	Term Loans
	 	 	0.875	%	 	 	1.875	%

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

4

 

     “Asset Acquisition” shall mean (a) an Investment by the Company or any Restricted
Subsidiary in any Person if, as a result of such Investment, such Person becomes a Restricted
Subsidiary, or is merged with or into the Company or any Restricted Subsidiary, or (b) the
acquisition by the Company or any Restricted Subsidiary of all or substantially all of the assets
of any other Person or any division or line of business of any other Person.

     “Asset Sale” shall mean the direct or indirect (a) sale, lease (other than an
operating lease entered into in the ordinary course of business), sale and leaseback, lease and
leaseback, assignment, conveyance, transfer or other disposition (by way of merger, consolidation,
casualty, condemnation, operation of law or otherwise (other than pursuant to a Recovery Event)) by
the Company or any of the Subsidiaries to any Person other than the Company or any Subsidiary
Guarantor of (1) any Equity Interests of any of the Subsidiaries (other than directors’ qualifying
shares or investments by foreign nationals required by applicable law) or (2) any other assets of
the Company or any of the Subsidiaries, including Equity Interests of any Person that is not the
Company or a Subsidiary or (b) issuance of Equity Interests in any of the Restricted Subsidiaries
to any Person other than the Company or any Subsidiary Guarantor; provided that (i) any
asset sale or series of related asset sales described in clause (a) or (b) above having a value not
in excess of $30,000,000 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 or other disposition by the Company or any Subsidiary of
(x) damaged, worn-out, obsolete assets and scrap, in each case in the ordinary course of business
and (y) cash or Cash Equivalents, (B) the sale by the Company or any Subsidiary of power, capacity,
fuel and other products or services, in each case in the ordinary course of business, (C) the sale,
lease, conveyance or other disposition for value by the Company or any 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) in connection with a foreclosure,
transfer or deed in lieu of foreclosure or other remedial action, (E) the sale, transfer or other
disposition by any Subsidiary that is not a Loan Party of any of its assets (other than any such
assets constituting Collateral) to any other Subsidiary that is not a Loan Party; provided
that if such transferor Subsidiary is a Domestic Subsidiary then such sale, transfer or other
disposition may only be to another Domestic Subsidiary, (F) a Restricted Payment that does not
violate Section 6.05 or a Permitted Investment, (G) the licensing of intellectual property and (H)
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.

     “Asset Sale Proceeds Account” shall mean a segregated account under the exclusive
dominion and control of the Collateral Trustee, for the benefit of the Secured Parties, which is
free from any other Liens.

     “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 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

5

 

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.”

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

     “Bankruptcy Court” shall mean the United States Bankruptcy Court for the Southern
District of New York.

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

     “Benchmark LIBO Rate” shall have the meaning assigned to such term in Section 2.24(b).

     “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 307 of ERISA, and in respect of which the Company or any ERISA Affiliate is (or, if such
plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined
in Section 3(5) of ERISA.

     “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.

     “Borrowers” shall mean the Revolving Loan Borrowers and the Term Loan Borrower.

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

     “Borrowing Request” shall mean a request by a Borrower in accordance with the terms of
Section 2.03 and substantially in the form of Exhibit D, or with such changes as may be approved by
the Administrative Agent acting reasonably.

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     “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 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 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 (a) United States dollars, Euros or, in the case of any
Foreign Subsidiary, any local currencies 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 maturities of not more than six
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; (d) repurchase obligations with a term of not more than seven 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; and (f) money market funds that invest primarily in
securities described in clauses (a) through (e) of this definition.

     “Change of Control” shall mean the occurrence of any of the following: (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 Company 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 Company 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

7

 

relating to the liquidation or dissolution of the Company; (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 50% of the Voting Stock of the
Company, measured by voting power rather than number of shares; (d) the Company consolidates with,
or merges with or into, any Person, or any Person consolidates with, or merges with or into, the
Company, in any such event pursuant to a transaction in which any of the outstanding Voting Stock
of the Company or such other Person is converted into or exchanged for cash, securities or other
property, other than any such transaction where the Voting Stock of the Company 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 Company are not Continuing Directors; (f) the Company shall at any time fail to
own directly or indirectly, beneficially and of record, 100% of each class of issued and
outstanding Capital Stock in NRG Power Marketing free and clear of all Liens (other than Liens
created by the Guarantee and Collateral Agreement); or (g) any change of control (or similar event,
however denominated) shall occur under and as defined in the Senior Note Documents.

     “Change in Law” shall mean (a) the adoption of any law, rule or regulation after the
Restatement Date, (b) any change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the Restatement Date or (c) compliance by
any Lender or the Issuing Bank (or, for purposes of Section 2.14, by any lending office of such
Lender or by such Lender’s or Issuing Bank’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 Restatement Date.

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

     “Class”, when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are Revolving Loans, Term Loans or Swingline Loans and,
when used in reference to any Commitment, refers to whether such Commitment is a Revolving Credit
Commitment, Term Loan Commitment, Swingline Commitment or Credit-Linked Deposit.

     “Closing Date” shall mean December 23, 2003.

     “Co-Documentation Agents” shall have the meaning assigned to such term in the
preamble.

     “Collateral” shall mean all property and assets of the Loan Parties, now owned or
hereafter acquired, other than the Excluded Assets.

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

     “Collateral Trust Agreement” shall mean the Collateral Trust Agreement, as amended and
restated on the Restatement Date, in the form of Exhibit E, executed and delivered by the

8

 

Company and each Subsidiary Guarantor, as the same may be amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof.

     “Collateral Trust Joinder” shall have the meaning assigned to such term in the
Collateral Trust Agreement.

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

     “Commitment” shall mean, with respect to any Lender, such Lender’s Revolving Credit
Commitment, Term Loan Commitment, Swingline Commitment and Credit-Linked Deposit.

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

     “Commitment Fee Rate” shall mean a rate per annum equal to (a) 1.00%, if the average
daily unused amount of the average Revolving Credit Commitment during the preceding fiscal quarter
(or other applicable period) shall equal 66-2/3% or more of such average Revolving Credit
Commitments, (b) 0.75%, if the average daily unused amount of the average Revolving Credit
Commitment during the preceding fiscal quarter (or other applicable period) shall be greater than
33-1/3% but less than 66-2/3% of such average Revolving Credit Commitment and (c) 0.50%, if the
average daily unused amount of the average Revolving Credit Commitment during the preceding fiscal
quarter (or other applicable period) shall be 33-1/3% or less of such average Revolving Credit
Commitment.

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

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

     “Confidential Information Memorandum” shall mean the Confidential Information
Memorandum of the Company dated November 2004.

     “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) the Fixed Charges of such Person and its Restricted Subsidiaries
for such period, to the extent that such Fixed Charges were deducted in computing such Consolidated
Net Income; plus (d) all non-recurring costs and expenses of such Person and its Restricted
Subsidiaries incurred in connection with the Reorganization Events, including but not limited to non-recurring costs and expenses incurred in the related
financing transactions and as a result of operating changes implemented within 18 months of the
completion of the Reorganization Events; plus (e) the amount of any restructuring charges
(including retention, severance, facility closure costs and benefit charges) related to the

9

 

Reorganization Events; plus (f) any professional and underwriting fees related to any equity
offering, Permitted Investment, acquisition, recapitalization or Indebtedness permitted to be
incurred under this Agreement and, in each case, deducted in such period in computing Consolidated
Net Income; plus (g) any non-cash compensation charges, including any such charges arising from
stock options, restricted stock grants or other equity-incentive programs to the extent that such
charges were deducted in computing such Consolidated Net Income; plus (h) 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 (i) 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; provided, however, that Consolidated
EBITDA of the Company will exclude the Consolidated EBITDA attributable to Excluded Subsidiaries to
the extent that the declaration or payment of dividends or similar distributions by the Excluded
Subsidiary of that Consolidated EBITDA is not, as a result of an Excluded Subsidiary Debt Default,
then permitted by operation of the terms of the relevant Excluded Subsidiary Debt Agreement;
provided that the Consolidated EBITDA of the Excluded Subsidiary will only be so excluded
for that portion of the period during which the condition described in the preceding proviso has
occurred and is continuing; provided further that for purposes of calculating
Consolidated EBITDA for any period for purposes of the covenant set forth in Section 6.11 (A) the
Consolidated EBITDA of any Person or line of business acquired by the Company or any Restricted
Subsidiary pursuant to an Asset Acquisition made in accordance with the terms of this Agreement
during such period for which the aggregate consideration paid by the Company or any Restricted
Subsidiary shall be equal to or greater than $25,000,000 shall be
included on a pro forma basis for
such period (assuming the consummation of such acquisition and the incurrence or assumption of any
Indebtedness in connection therewith occurred as of the first day of such period) and (B) the
Consolidated EBITDA of any Person or line of business sold or otherwise disposed of by the Company
or any Restricted Subsidiary during such period for which the aggregate consideration received by
the Company or any Restricted Subsidiary shall be equal to or greater than $25,000,000 shall be
excluded for such period (assuming the consummation of such sale or other disposition and the
repayment of any Indebtedness in connection therewith occurred as of the first day of such period).

     “Consolidated Interest Coverage Ratio” shall mean, on any date, the ratio of (a)
Consolidated EBITDA of the Company for the period of four consecutive fiscal quarters most recently
ended on or prior to such date, taken as one accounting period, to (b) Consolidated Interest
Expense for the period of four consecutive fiscal quarters most recently ended on or prior to such
date, taken as one accounting period.

     “Consolidated Interest Expense” shall mean, for any period, (a) the sum of, without
duplication, (i) the interest expense (including imputed interest expense in respect of Capital
Lease Obligations and Synthetic Lease Obligations) of the Company and the Restricted Subsidiaries
for such period (including all commissions, discounts and other fees and charges

10

 

owed by the
Company and the 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, plus (ii) any interest accrued during such period in respect of Indebtedness of the
Company or any Restricted Subsidiary that is required to be capitalized rather than included in
consolidated interest expense for such period in accordance with GAAP, minus (b) to the extent
included in such consolidated interest expense for such period, amounts attributable to the
amortization of financing costs and non-cash amounts attributable to the amortization of debt
discounts. For purposes of the foregoing, interest expense shall be determined after giving effect
to any net payments made or received by the Company or any Restricted Subsidiary with respect to
interest rate Hedging Agreements.

     “Consolidated Leverage Ratio” shall mean, on any date, the ratio of (a) Total Debt on
such date to (b) Consolidated EBITDA of the Company for the period of four consecutive fiscal
quarters most recently ended on or prior to such date, taken as one accounting period.

     “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) paid in cash to the specified
Person or a Restricted Subsidiary of the Person; (b) for purposes of Sections 6.05, 6.10 and 6.11
hereof only, 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; and (d) 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.

     “Continuing Directors” shall mean, as of any date of determination, any member of the
Board of Directors of the Company 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
each Loan Party and the other parties thereto, as required by the Guarantee and 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.

     “Core Collateral” shall mean all Equity Interests in, and property and assets of, NRG
Mid-Atlantic, NRG Northeast and NRG South Central and their respective subsidiaries (other than NRG
Sterlington Power LLC, Bayou Cove Peaking Power LLC and Big Cajun I Peaking

11

 

Power LLC for so long as such entities shall constitute Excluded Project Subsidiaries), whether now owned or hereafter
acquired.

     “Credit Event” shall have the meaning assigned to such term in Section 4.01.

     “Credit Facilities” shall mean one or more debt facilities (including this Agreement)
or commercial paper facilities, in each case with banks or other institutional lenders providing
for revolving credit loans, term loans, credit-linked deposits (or similar deposits), receivables
financing (including through the sale of receivables to such lenders or to special purpose entities
formed to borrow from such lenders against such receivables) or letters of credit, in each case, as
amended, restated, modified, renewed, refunded, replaced or refinanced (including by means of sales
of debt securities to institutional investors) in whole or in part from time to time.

     “Credit-Linked Deposit” shall mean, with respect to each Funded L/C Lender, the cash
deposit, if any, made by such Funded L/C Lender pursuant to Section 2.23(d), as the same may be (a)
reduced from time to time pursuant to Section 2.02(f), 2.09(b) or 2.09(d) and (b) reduced or
increased from time to time pursuant to assignments by or to such Funded L/C Lender pursuant to
Section 9.04. The amount of each Funded L/C Lender’s Credit-Linked Deposit on the Restatement Date
is set forth on the Lender Addendum delivered by such Lender.

     “Credit-Linked Deposit Account” shall mean, collectively, one or more operating and/or
investment accounts of, and established by, the Administrative Agent under its sole and exclusive
control and maintained at the office of the Administrative Agent located at Eleven Madison Avenue,
New York, New York 10010 (or such other office as the Administrative Agent shall from time to time
designate to the Company), in any such case that shall be used for the purposes set forth in
Article II.

     “Default” shall mean any event or condition which constitutes an Event of Default or
which upon notice, lapse of time 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 existing on the Closing Date.

     “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

12

 

have the right to require the Company 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 Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 6.05 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 Company 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.

     “dollars” or “$” shall mean lawful money of the United States of America.

     “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.

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

     “Engagement Letter” shall mean the Engagement Letter dated as of November 29, 2004,
among the Company, Credit Suisse First Boston and Goldman Sachs Credit Partners L.P.

     “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 exposure to, Hazardous Materials, or the generation, manufacture,
processing, distribution, use, treatment, storage, transport, recycling or handling of, or the
arrangement for such activities with respect to, Hazardous Materials.

     “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) compliance or non-compliance with any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release of any Hazardous
Materials at any location or (e) any contract, agreement or other consensual arrangement 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 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”, “Net Cash Proceeds” and
“Specified Joint Venture Sales”, any debt security that is convertible into, or exchangeable for,
Capital Stock).

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

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     “ERISA Affiliate” shall mean any trade or business (whether or not incorporated) that,
together with the Company, 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 Company or any of its ERISA Affiliates 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 Company or any of its ERISA Affiliates from any Benefit Plan or
Multiemployer Plan; (e) the receipt by the Company or any of its ERISA Affiliates from the PBGC or
a plan administrator of any notice relating to the intention to terminate any Benefit Plan or Plans
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; (g) the receipt by the Company or any of its ERISA Affiliates of any
notice, or the receipt by any Multiemployer Plan from the Company or any of its ERISA Affiliates 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; or (h) the occurrence of a material non-exempt “prohibited transaction” with
respect to which the Company or any of the Subsidiaries is a “disqualified person” (within the
meaning of Section 4975 of the Tax Code) or with respect to which the Company or any such
Subsidiary could otherwise be liable.

     “Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the 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 fiscal year of the Company, the excess of (a)
the sum, without duplication, of the cash flow from operations determined on an unconsolidated
basis in accordance with GAAP of the Company and the Subsidiaries and, to the extent of the
Company’s or any Subsidiary’s interest therein, any Person (other than a Subsidiary) in which the
Company or any Subsidiary has an interest; provided that there shall be excluded the cash
flow from operations of any Subsidiary or other Person in which the Company or any Subsidiary has
an interest to the extent that the declaration or payment of dividends or similar distributions by
such Subsidiary or such other Person of that cash flow from operations is not at the time permitted by operation of the terms of its governing documents or any agreement, instrument,
judgment, decree, statute, rule or governmental regulation applicable to such Subsidiary, over (b)
the sum, without duplication, of (i) the cash outflow from investments determined on an

14

 

unconsolidated basis in accordance with GAAP of the Company and the Subsidiaries and, to the extent
of the Company’s or any Subsidiary’s interest therein, any Person (other than a Subsidiary) in
which the Company or any Subsidiary has an interest, (ii) permanent repayments of Indebtedness
(other than mandatory prepayments of Loans under Section 2.13) made by the Company and the
Subsidiaries during such fiscal year, but only to the extent that such prepayments by their terms
cannot be reborrowed or redrawn and do not occur in connection with a refinancing of all or any
portion of such Indebtedness and (iii) to the extent reflected in cash flow from operations of the
Company and the Subsidiaries for such period, any Xcel Cash.

     “Excess Credit-Linked Deposits” shall mean, at any time, the excess, if any, of the
Total Credit-Linked Deposit over the aggregate Funded L/C Exposure at such time.

     “Excluded Assets” shall mean (i) any lease, license, contract, property right or
agreement to which any Loan Party is a party or any of such Loan Party’s rights or interests
thereunder if and only for so long as the grant of a security interest therein under the Security
Documents shall constitute or result in a breach, termination or default or invalidity under any
such lease, license, contract, property right or agreement (other than to the extent that any such
term would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC of
any relevant jurisdiction or any other applicable law or principles of equity); provided
that such lease, license, contract, property right or agreement shall be an Excluded Asset only to
the extent and for so long as the consequences specified above shall result and shall cease to be
an Excluded Asset and shall become subject to the security interest granted under the Security
Documents, immediately and automatically, at such time as such consequences shall no longer result;
(ii) any interests in real property owned or leased by any Loan Party only for so long as such
interest represents an Excluded Perfection Asset; (iii) any Equity Interests in any Excluded
Project Subsidiary the pledge of which pursuant to the Security Documents would constitute a
default under the applicable Non-Recourse Indebtedness in respect of which it is an obligor and any
voting Equity Interests in excess of 66% (or, in the case of NRG International Holdings GmbH, NRG
International Holdings (No.2) GmbH and NRGenerating International BV, 65%) of the total outstanding
voting Equity Interests in any Excluded Foreign Subsidiary; (iv) any Deposit Account, Securities
Account or Commodities Account (and all cash, cash equivalents and Commodity Contracts held
therein) if and only for so long as such Deposit Account, Securities Account or Commodities Account
is subject to a Lien permitted under clause (r) of the definition of “Permitted Liens”; (v) the
Equity Interests in, and all properties and assets of, NRG Energy Insurance Ltd. (Cayman Islands);
(vi) the Equity Interests in, and all properties and assets of, NRGenerating III (Gibraltar),
NRGenerating IV Gibraltar, NRG Pacific Corporate Services Pty Ltd., Coniti Holding BV (only for so
long as such entity shall own no assets other than the Equity Interests in Tosli (Gibraltar) BV)
and Tosli (Gibraltar) BV (only for so long as such entity shall own no assets); (vii) the Equity
Interests in, and all properties and assets of, NRG Latin America Inc., Sterling Luxembourg (No. 4)
S.a.r.l, NRGenerating Luxembourg (No. 6) S.a.r.l. and NRGenerating Holdings (No. 21) BV (only for
so long as such entity shall own no assets other than the stock of its subsidiaries owned on the
Closing Date); (viii) any Equity Interest of a Person (other than a Subsidiary) held by any Loan
Party if and for so long as the pledge thereof under the Security Documents shall constitute or
result in a breach, termination or default under any joint venture, stockholder or partnership agreement between such Loan Party and one or
more other holders of Equity Interests of such Person; provided that (A) such Loan Party
shall have used reasonable efforts to obtain the consent or waiver of such other holders of Equity

15

 

Interests of such Person to such a pledge and such consent or waiver shall not have been obtained
and (B) such Equity Interest shall be an Excluded Asset only to the extent and for so long as the
consequences specified above shall result and shall cease to be an Excluded Asset and shall become
subject to the security interest granted under the Security Documents, immediately and
automatically, at such time as such consequences shall no longer result; (ix) all properties and
assets of the Company’s resource recovery facility located at North Newport, MN and all properties
and assets of the Company’s resource recovery facility located at Elk River, MN if and for so long
as the grant of a security interest therein under the Security Documents shall constitute or result
in a breach, termination or default under any service agreement with the applicable municipalities
in which such facilities reside; provided that (A) the Company shall have used reasonable
efforts to obtain the consent or waiver of such municipalities to the grant of such security
interests and such consent or waiver shall not have been obtained and (B) such properties and
assets shall be an Excluded Asset only to the extent and for so long as the consequences specified
above shall result and shall cease to be an Excluded Asset and shall become subject to the security
interest granted under the Security Documents, immediately and automatically, at such time as such
consequences shall no longer result; (x) any Account of NRG Power Marketing solely to the extent
that (x) such Account relates to the sale by NRG Power Marketing of power or capacity that was
purchased by NRG Power Marketing from a Subsidiary that is an Excluded Project Subsidiary and (y)
the grant of a security interest in such Account under the Security Documents shall constitute or
result in a breach, termination or default under any agreement or instrument governing the
applicable Existing Non-Recourse Indebtedness of such Subsidiary (as such agreement or instrument
was in effect on the Closing Date); (xi) the Equity Interests in either of the NEO Companies to the
extent that a grant of a security interest in such Equity Interests under the Security Documents
shall constitute or result in a breach, termination or default under any agreement or instrument
governing the applicable Existing Non-Recourse Indebtedness of their subsidiaries (as such
agreement or instrument was in effect on the Closing Date); and (xii) the Deposit Account
established by the Company pursuant to the NRG Plan in respect of the Consolidated Edison dispute
and all cash held therein not to exceed (x) $11,700,000 as of the Closing Date plus (y) any amounts
required by the NRG Plan to be deposited therein in respect of invoices owing to Consolidated
Edison; provided that such Deposit Account (and all cash therein) shall automatically cease
to be an Excluded Asset from and after the date that such dispute is resolved.

     “Excluded Foreign Subsidiaries” shall mean, at any time, any Foreign Subsidiary that
is (or is treated as) for United States federal income tax purposes either (a) a corporation or (b)
a pass-through entity owned directly or indirectly by another Foreign Subsidiary that is (or is
treated as) a corporation; provided that (i) none of NRG Mid-Atlantic, NRG Northeast or NRG
South Central or any of their respective subsidiaries may at any time be an Excluded Foreign
Subsidiary and (ii) notwithstanding the foregoing, the following entities will be deemed to be
“Excluded Foreign Subsidiaries”: Sterling Luxembourg (No. 4) S.a.r.l., Tosli Acquisition BV,
NRGenerating Luxembourg (No. 6) S.a.r.l., NRGenerating Holdings (No. 4) GmbH (only for so long as
such entity shall remain a direct subsidiary of NRG International LLC and shall have no assets
other than those owned on the Closing Date), NRGenerating Holdings (No. 3) Gibraltar, NRGenerating
Holdings (No. 23) BV, NRG Pacific Corporate Services Pty Ltd., NRGenerating III (Gibraltar), NRGenerating IV (Gibraltar), Coniti Holding BV (only for so long as such
entity shall own no assets other than the Equity Interests in Tosli (Gibraltar) BV) and Tosli
(Gibraltar)

16

 

BV (only for so long as such entity shall own no assets). The Excluded Foreign
Subsidiaries on the Restatement Date are set forth on Schedule 1.01(a).

     “Excluded Perfection Assets” shall mean any property or assets (other than any Core
Collateral except (a) the lease of Dunkirk Power LLC relating to 347 Seneca Street, Buffalo, NY,
(b) the lease of Astoria Gas Turbine Power LLC relating to the Consolidated Edison site located at
31-02 20th Avenue, Astoria, NY, (c) the lease of Astoria Gas Turbine Power LLC relating
to the A-11 dock located at 31-02 20th Avenue, Astoria, NY, (d) the lease of NRG New
Roads Holding LLC relating to the turbine storage facilities located at GTS Duratek, 1790 Dock
Street, Memphis, TN, (e) the lease of NRG New Roads Holding LLC relating to the turbine storage
facilities located at Liebherr American Inc., 4100 Chestnut, Newport News, VA and (f) the lease of
NRG New Roads Holding LLC relating to the warehouse facilities for turbine storage located at
Tidewater Warehouses, Bay 3, 814 Childs Avenue, Hampton, VA) 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;
provided that such property or assets shall not have a Fair Market Value at any time
exceeding $2,000,000 (or, if such property or asset is a Deposit Account or Securities Account,
$250,000) individually or $20,000,000 in the aggregate and, to the extent that the Fair Market
Value of any such property or asset shall exceed $2,000,000 (or, if such property or asset is a
Deposit Account or Securities Account, $250,000) 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 $20,000,000 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.

     “Excluded Proceeds” shall mean any net proceeds of an Asset Sale involving the sale of
Specified Assets Held for Sale.

     “Excluded Project Subsidiaries” shall mean, at any time, (a) any Subsidiary existing
as of the Restatement Date that is an obligor with respect to Existing Non-Recourse Indebtedness
outstanding at such time and (b) any Subsidiary that is set forth on Schedule 1.01(b) as of the
Restatement Date (so long as such Subsidiary does not become (and remain for a period of 365 days
or more) a Subsidiary Guarantor after the Restatement Date) or any Subsidiary that becomes a
Subsidiary after the Restatement Date that is an obligor with respect to Additional Non-Recourse
Indebtedness outstanding at such time, in each case if and for so long as the grant of a security
interest in the property or assets of such Subsidiary or the pledge of the Equity Interests of such
Subsidiary, in each case in favor of the Collateral Trustee for the benefit of the Secured Parties,
shall constitute or result in a breach, termination or default under the agreement or instrument
governing the applicable Non-Recourse Indebtedness; provided that such Subsidiary shall be
an Excluded Project Subsidiary only to the extent that and for so long as the requirements and
consequences above shall exist; provided further that none of NRG Mid-Atlantic, NRG
Northeast or NRG South Central or any of their respective subsidiaries (other than NRG Sterlington
Power LLC, Bayou Cove Peaking Power LLC and Big Cajun I Peaking Power LLC for so long as such
entities shall constitute Excluded Project Subsidiaries) may at any time be an Excluded Project Subsidiary. The Excluded Project Subsidiaries on the
Restatement Date are set forth on Schedule 1.01(b).

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     “Excluded Subsidiary” shall mean an Excluded Foreign Subsidiary, an Excluded Project
Subsidiary and (except for purposes of Sections 5.06 and 5.09 hereof) an Immaterial Subsidiary.

     “Excluded Subsidiary Debt Agreement” shall mean the agreement or documents governing
the relevant Indebtedness referred to in the definition of “Excluded Subsidiary Debt Default.”

     “Excluded Subsidiary Debt Default” shall mean, with respect to any Excluded
Subsidiary, the failure of such Excluded Subsidiary to pay any principal or interest or other
amounts due in respect of any Indebtedness, when and as the same shall become due and payable, or
the occurrence of any other event or condition that results in any Indebtedness of such Excluded
Subsidiary becoming due prior to its scheduled maturity or that enables or permits (with or without
the giving of notice, lapse of time or both) the holder or holders of such Indebtedness or any
trustee or agent on its or their behalf to cause such Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity.

     “Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, the
Issuing Bank and any other recipient of any payment to be made by or on account of any obligation
of a Borrower hereunder, and, for purposes of Section 2.20 only, by or on account of any obligation
of the Administrative Agent pursuant to Section 2.24(b), (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 a 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 such Borrower with respect to such withholding tax pursuant to Section 2.20(a) or (b).

     “Exempt Subsidiaries” shall mean, collectively, NRG Ilion LP LLC, NRG Ilion Limited
Partnership, Meriden Gas Turbine LLC, LSP Kendall Energy LLC, LSP-Pike Energy 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, LSP Energy Limited Partnership, NRG Batesville
LLC, LSP Batesville Funding Corporation, LSP Batesville Holding LLC, LSP Energy, Inc., NRG Peaker
Finance Company LLC, Bayou Cove Peaking Power, LLC, Big Cajun I Peaking Power LLC, NRG Rockford
LLC, NRG Rockford II LLC and NRG Sterlington Power LLC.

     “Existing Indebtedness” shall mean Indebtedness of the Company and its 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.

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     “Existing Letter of Credit” shall mean each letter of credit issued or deemed to have
been issued under the Original Credit Agreement that is outstanding on the Restatement Date. The
Existing Letters of Credit are listed on Schedule 1.01(c).

     “Existing Non-Recourse Indebtedness” shall mean secured Indebtedness for borrowed
money outstanding as of the Closing Date of a Subsidiary (or of Cadillac Renewable Energy LLC)
existing as of the Closing Date and any Permitted Refinancing Indebtedness in respect of such
Indebtedness that was incurred to finance the development, construction or acquisition of or by, or
repairs, improvements or additions to, fixed or capital assets of such Subsidiary (including power
generation facilities); provided that, except as set forth on Schedule 1.01(d), (a) such
Indebtedness is without recourse to the Company or any other Subsidiary or to any property or
assets of the Company or any other Subsidiary (other than, in each such case, another Subsidiary
(x) which is the direct parent or a direct or indirect Subsidiary of the Subsidiary that incurred
or issued such Indebtedness (other than any such Indebtedness constituting a Guarantee) or (y) that
is a Subsidiary that itself has Non-Recourse Indebtedness (other than any 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 any such Indebtedness constituting
a Guarantee)), (b) neither the Company nor any other Subsidiary (other than another Subsidiary (x)
which is the direct parent or a direct or indirect Subsidiary of the Subsidiary that incurred or
issued such Indebtedness (other than any such Indebtedness constituting a Guarantee) or (y) that is
a Subsidiary that itself has Non-Recourse Indebtedness (other than any 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 any 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, Section 2.23 to support obligations of
such applicable subsidiary and (ii) any investments in such applicable subsidiary made in
accordance with Section 6.05), (c) neither the Company nor any other Subsidiary or Affiliate of any
thereof constitutes the lender of such Indebtedness, (d) 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 that is not a Loan Party) would permit upon notice, lapse
of time or both any holder of any other Indebtedness of the Company or any other Loan Party (other
than Indebtedness incurred pursuant to Section 6.01(b)(i), (ii), (iii) or (xi)) 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 (e) the Liens securing such Indebtedness shall exist only
on (i) the property and assets of any Subsidiary that is not a Loan Party and (ii) the Equity
Interests in any Subsidiary that is not a Loan Party (and shall not apply to any other property or
assets of the Company or any other Subsidiary that is a Loan Party), except, in the case of each of
clauses (a) and (b) for (x) agreements of the Company or any other Subsidiary to provide corporate
or management services or operation and maintenance services to such Subsidiary, (y) Guarantees of the Company or any other Subsidiary 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

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Company or any other Subsidiary 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 generation facility.

     “Facility Instruments” shall have the meaning set forth in (a) the Affirmation
Agreement, dated as of August 9, 1993, by and among Northern States Power Company, the Company and
Ramsey and Washington Counties and (b) the Agreement and Consent for Transfer to the Company, dated
as of August 20, 2001, between Northern States Power Company, the Company, Anoka County, Hennepin
County, Sherburne County and Tri-County Solid Waste Management Commission, as in effect on the
Closing Date.

     “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 or necessity of either party,
determined in good faith by the Board of Directors of the Company (unless otherwise provided in
this Agreement).

     “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.

     “Fees” shall mean the Commitment Fees, the Administrative Agent’s Fees, any Prepayment
Fee, the L/C Participation Fees and the Issuing Bank Fees.

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

     “Financial Institution” shall mean a bank, an investment bank or an Affiliate of a
bank or an investment bank.

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

     “Fixed Charge Coverage Ratio” shall mean with respect to any specified Person for any
period, the ratio of the Consolidated EBITDA of such Person for such period to the Fixed Charges of
such Person for such period. In the event that the specified Person or any of its Restricted
Subsidiaries incurs, assumes, Guarantees, repays, repurchases, redeems, defeases or otherwise
discharges any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases
or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge
Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the
“Calculation Date”), then the Fixed Charge Coverage Ratio will be calculated giving pro
forma effect to such incurrence, assumption, Guarantee, repayment, repurchase, redemption,
defeasance or other discharge of Indebtedness, or such issuance, repurchase or redemption of

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preferred stock, and the use of the proceeds therefrom, as if the same had occurred at the
beginning of the applicable four-quarter reference period. In addition, for purposes of
calculating the Fixed Charge Coverage Ratio (a) acquisitions that have been made by the specified
Person or any of its Restricted Subsidiaries, including through mergers or consolidations, or any
Person or any of its Restricted Subsidiaries acquired by the specified Person or any of its
Restricted Subsidiaries, and including any related financing transactions and including increases
in ownership of Restricted Subsidiaries, during the four-quarter reference period or subsequent to
such reference period and on or prior to the Calculation Date will be given pro forma effect (in
accordance with Regulation S-X under the Securities Act, but including all Pro Forma Cost Savings)
as if they had occurred on the first day of the four-quarter reference period and Consolidated
EBITDA for such reference period will be calculated on the same pro forma basis; (b) the
Consolidated EBITDA attributable to discontinued operations, as determined in accordance with GAAP,
and operations or businesses (and ownership interests therein) disposed of prior to the Calculation
Date, will be excluded; (c) the Fixed Charges attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses (and ownership interests therein)
disposed of prior to the Calculation Date, will be excluded, but only to the extent that the
obligations giving rise to such Fixed Charges will not be obligations of the specified Person or
any of its Restricted Subsidiaries following the Calculation Date; (d) any Person that is a
Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary
at all times during such four-quarter period; (e) any Person that is not a Restricted Subsidiary on
the Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during
such four-quarter period; and (f) if any Indebtedness that is being incurred on the Calculation
Date bears a floating rate of interest, the interest expense on such Indebtedness will be
calculated as if the rate in effect on the Calculation Date had been the applicable rate for the
entire period (taking into account any Hedging Obligation applicable to such Indebtedness if such
Hedging Obligation has a remaining term as at the Calculation Date in excess of 12 months).

     “Fixed Charges” shall mean, with respect to any specified Person for any period, the
sum, without duplication, of (a) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, including 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, commissions, discounts and
other fees and charges incurred in respect of letter of credit or bankers’ acceptance financings,
and net of the effect of all payments made or received pursuant to Hedging Obligations in respect
of interest rates; plus (b) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period; plus (c) 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 (d) the product of (i) all dividends,
whether paid or accrued and whether or not in cash, on any series of preferred stock of such Person
or any of its Restricted Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of the Company (other than Disqualified Stock) or to the Company or
a Restricted Subsidiary, times (ii) 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

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Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP.

     “Foreign Lender” shall mean any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrowers are 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.

     “Funded Issuing Bank Fees” shall have the meaning assigned to such term in Section
2.05(d).

     “Funded L/C Commitment” shall mean the commitment of the Issuing Bank to issue Funded
Letters of Credit pursuant to Section 2.23.

     “Funded L/C Disbursements” shall mean a payment or disbursement made by the Issuing
Bank pursuant to a Funded Letter of Credit.

     “Funded L/C Exposure” shall mean, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Funded Letters of Credit at such time and (b) the aggregate amount of all
Funded L/C Disbursements that have not yet been reimbursed at such time (or deemed to have not yet
been reimbursed at such time pursuant to Section 2.23(e)). The Funded L/C Exposure of any Funded
L/C Lender at any time shall equal its Pro Rata Percentage of the aggregate Funded L/C Exposure at
such time.

     “Funded L/C Fee Payment Date” shall have the meaning assigned to such term in Section
2.05(d).

     “Funded L/C Lender” shall mean a Lender with a Credit-Linked Deposit.

     “Funded L/C Participation Fee” shall have the meaning assigned to such term in Section
2.05(d).

     “Funded Letter of Credit Availability Period” shall mean the period from and including
the Restatement Date to but excluding the earlier of the Funded Letter of Credit Maturity Date and
the date on which all of the Credit-Linked Deposits are returned to the Funded L/C Lenders,
utilized to reimburse the Issuing Bank for Funded L/C Disbursements or converted into Term Loans.

     “Funded Letter of Credit Maturity Date” shall mean the Term Loan Maturity Date.

     “Funded Letter of Credit” shall mean, at any time, any Letter of Credit that has been
designated by the Term Loan Borrower (or deemed designated) as a Funded Letter of Credit in
accordance with the provisions of Section 2.23.

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     “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.

     “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 or
pertaining to government.

     “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).

     “Guarantee and Collateral Agreement” shall mean the Guarantee and Collateral
Agreement, as amended and restated on the Restatement Date, in the form of Exhibit F, executed and
delivered by the Company and each Subsidiary Guarantor, as the same may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the terms thereof.

     “Hazardous Materials” shall mean (a) any petroleum products or byproducts and all
other hydrocarbons, coal ash, coal combustion by-products or waste, boiler slag, scrubber residue,
flue desulfurization material, radon gas, asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls, 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 Agreement” shall mean any agreement of the type described in clauses (a), (b)
or (c) of the definition of “Hedging Obligations”.

     “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 or commodity prices.

     “Immaterial Subsidiary” shall mean, at any time, any Restricted Subsidiary that is
designated by the Company as an “Immaterial Subsidiary” if and for so long as such Restricted
Subsidiary, together with all other Immaterial Subsidiaries, has (a) total assets at such time not
exceeding 5% of the Company’s consolidated assets as of the most recent fiscal quarter for

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which balance sheet information is available and (b) total revenues and operating income for the most
recent 12-month period for which income statement information is available not exceeding 5% of the
Company’s consolidated revenues and operating income, respectively; provided that (i) such
Restricted Subsidiary shall be an Immaterial Subsidiary only to the extent that and for so long as
all of the above requirements are satisfied and (ii) none of NRG Mid-Atlantic or its subsidiaries,
NRG Northeast or its subsidiaries or NRG South Central or its subsidiaries may at any time be an
Immaterial Subsidiary hereunder. The Immaterial Subsidiaries on the Restatement Date are set forth
on Schedule 1.01(e).

     “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), 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 the net amount owing under any 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.

     “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.

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

     “Intellectual Property Security Agreement” shall mean all Intellectual Property
Security Agreements, as amended and restated on the Restatement Date, executed and delivered by the
Loan Parties, each substantially in the applicable form required by the Guarantee and 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 Loan (other than a
Swingline Loan), the last Business Day of each March, June, September
and December (beginning with March 31, 2005), (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such 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’

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duration been applicable to such Borrowing, and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.

     “Interest Period” shall mean (a) with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending 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 applicable Borrower may elect and (b) with respect to the
Credit-Linked Deposits, each period commencing on the date the Credit-Linked Deposits are initially
funded or on the last day of the preceding Interest Period applicable thereto, as the case may be,
and ending (x) in the case of the first Interest Period in respect of the Credit-Linked Deposits,
on March 31, 2005 and (y) in the case of each Interest Period in respect of the Credit-Linked
Deposits thereafter, on the numerically corresponding date in the calendar month that is 3 months
thereafter; provided, however, that (i) a single Interest Period shall at all times
apply to all Credit-Linked Deposits, (ii) 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 (iii) any Interest Period 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.

     “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 (excluding commission, travel
and similar advances to officers and employees made in the ordinary course of business), 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 Company or any Subsidiary 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 Company 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
Company’s Investments in such Subsidiary that were not sold or disposed of in an amount determined
as provided in the final paragraph of Section 6.05 hereof. The acquisition by the Company, or by
any Subsidiary, of a Person that holds an Investment in a third Person will be deemed to be an
Investment by 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 in an amount
determined as provided in the final paragraph of Section 6.05(b) hereof. 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.

25

 

     “Issuing Bank” shall mean, as the context may require, (a) Credit Suisse First Boston
in its capacity as the issuer of Letters of Credit hereunder and (b) any other Lender that may
become an Issuing Bank pursuant to Section 2.23(i) or 2.23(k), with respect to Letters of Credit
issued by such Lender and (c) in respect of each Existing Letter of Credit, the issuer thereof.
The Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by
Affiliates of the Issuing Bank or other financial institutions, in which case the term “Issuing
Bank” shall include any such Affiliate or other financial institution with respect to Letters of
Credit issued by such Affiliate or other financial institution.

     “Issuing Bank Fees” shall mean Revolving Issuing Bank Fees and Funded Issuing Bank
Fees.

     “L/C Commitment” shall mean a Revolving L/C Commitment or a Funded L/C Commitment.

     “L/C Disbursement” shall mean a Revolving L/C Disbursement or a Funded L/C
Disbursement.

     “L/C Exposure” shall mean, at any time, the Revolving L/C Exposure and the Funded L/C
Exposure at such time.

     “L/C Exposure Cap” shall mean $125,000,000.

     “Lender Addendum” shall mean, with respect to any initial Lender, a Lender Addendum in
the form of Exhibit G, or such other form as may be supplied by the Administrative Agent, to be
executed and delivered by such Lender on the Restatement 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. Unless the
context otherwise requires, the term “Lenders” shall include the Swingline Lender.

     “Letter of Credit” shall mean a Revolving Letter of Credit or a Funded Letter of
Credit or an Existing Letter of Credit.

     “LIBO Rate” shall mean, with respect to any Eurodollar Borrowing or Credit-Linked
Deposit 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

26

 

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.

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

     “Loan Parties” shall mean the Company and each Subsidiary Guarantor.

     “Loans” shall mean the Revolving Loans, the Term Loans and the Swingline Loans.

     “Majority Lenders” shall mean, at any time, Lenders having Loans (excluding Swingline
Loans), Revolving L/C Exposure, Funded L/C Exposure, Swingline Exposure, unused Revolving Credit
Commitments and Term Loan Commitments and Excess Credit-Linked Deposits representing at least a
majority of the sum of all Loans outstanding (excluding Swingline Loans), Revolving L/C Exposure,
Funded L/C Exposure, Swingline Exposure, unused Revolving Credit Commitments and Term Loan
Commitments and Excess Credit-Linked Deposits at such time.

     “Majority Revolving Credit Lenders” shall mean, at any time, Revolving Credit Lenders
having Revolving Loans (excluding Swingline Loans), Revolving L/C Exposure, Swingline Exposure and
unused Revolving Credit Commitments representing at least a majority of the sum of all Revolving
Loans outstanding (excluding Swingline Loans), Revolving L/C Exposure, Swingline Exposure and
unused Revolving Credit Commitments at such time.

     “Majority Term Lenders” shall mean, at any time, Term Lenders and Funded L/C Lenders
having Term Loans, Funded L/C Exposure, unused Term Loan Commitments and Excess Credit-Linked
Deposits representing at least a majority of the sum of all Term Loans outstanding, Funded L/C
Exposure, unused Term Loan Commitments and Excess Credit-Linked Deposits at such time.

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

     “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, liabilities or
prospects of the Company and the Subsidiaries, taken as a whole, or (b) the validity or
enforceability of any of the Loan Documents or the rights and remedies of the Arrangers, the
Administrative Agent, the Collateral Agent, the Collateral Trustee or the Secured Parties
thereunder.

27

 

     “Material Contract” shall have the meaning assigned to such term in the Guarantee and
Collateral Agreement.

     “Material Indebtedness” shall mean Indebtedness for money borrowed (other than the
Loans and Letters of Credit) of any one or more of the Company or any of the Subsidiaries in an
aggregate principal amount exceeding $50,000,000.

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

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

     “Mortgaged Properties” shall mean, initially, each parcel of real property and the
improvements located thereon and appurtenants thereto owned or leased by a Loan Party and specified
on Schedule 1.01(f), and shall include each other parcel of real property and improvements located
thereon with respect to which a Mortgage is granted pursuant to Section 5.09 or 5.10.

     “Mortgages” shall mean (a) the amended and restated mortgages, deeds of trust,
leasehold mortgages, assignments of leases and rents, modifications and other security documents
granting a Lien on any Mortgaged Property to secure the Secured Obligations, each in the form of
Exhibit H with such changes as are reasonably satisfactory to the Company (which shall be evidenced
by the signature thereof by the applicable Loan Party), the Collateral Agent and the Collateral
Trustee and/or (b) reaffirmations of, and/or modifications to, the Mortgages (as defined under the
Original Credit Agreement), in each case, 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.

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

     “Net Cash Proceeds” shall mean, with respect to any Asset Sale or Recovery Event, the
proceeds thereof in the form of cash and Cash Equivalents (including any such proceeds subsequently
received (as and when received) in respect of noncash consideration initially received), net of (i)
expenses related to such Asset Sale or Recovery Event (including legal, accounting and investment
banking fees, broker’s fees and sales commissions, relocation fees, and taxes paid or payable by
the Company and the Subsidiaries in connection therewith and the Company’s good faith estimate of
any other taxes to be paid or payable in connection with such Asset Sale or 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 Company
and the Subsidiaries by the applicable Governmental Authority in connection with such Recovery
Event), (ii) amounts remitted in an escrow or provided as a reserve, in accordance with GAAP,
against any liabilities under any indemnification obligations or purchase price adjustment
associated with such asset or Asset Sale (provided that, to the extent and at the time any
such amounts are released from such reserve or escrow to the benefit of the Company or any
Subsidiary, such amounts shall constitute Net Cash

28

 

Proceeds) 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) which is secured by the asset transferred, taken or sold in such Asset Sale or
Recovery Event and which is required to be repaid with such proceeds (such proceeds with respect to
any Asset Sale (other than Excluded Proceeds), “Net Asset Sale Proceeds”);
provided, however, that, during each fiscal year of the Company the initial
$25,000,000 of Net Asset Sale Proceeds that is received during such fiscal year shall not be
subject to the mandatory prepayment provisions of Section 2.13(b) even if the terms of the
following proviso are not complied with in respect of such $25,000,000 of Net Asset Sale Proceeds,
but shall be subject to and included in the amounts and limitations set forth in the last sentence
of this definition; provided further, however, that, subject to the last
sentence of this definition, if (v) the Company shall deliver a certificate of a Financial Officer
to the Administrative Agent at the time of receipt thereof setting forth the Company’s intent to
reinvest such proceeds in an acquisition 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
Company and the Subsidiaries within 365 days of receipt of such proceeds, (w) pending such use of
such proceeds such proceeds are held in an Asset Sale Proceeds Account or are temporarily used to
prepay Revolving Credit Borrowings hereunder pending such permitted reinvestment, (x) no Default or
Event of Default shall have occurred and shall be continuing at the time of such certificate or at
the proposed time of the application of such proceeds (both before and after giving effect to such
application), (y) if such proceeds (1) result from the sale of the Equity Interests in any Person
that is incorporated, formed or organized under the laws of the United Sates of America, any State
thereof or the District of Columbia (a “U.S. Person”) or any other assets located in the
United States, such proceeds shall only be 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) result from the sale of the Equity Interests in
any Person other than a U.S. Person, such proceeds shall only be 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 and (z) if such proceeds
result from the sale of any Equity Interests in any Subsidiary Guarantor or any other assets that
constitute Collateral, such proceeds shall only be used to make an acquisition of a Person that
will, following the consummation of such acquisition, be a Subsidiary Guarantor or an acquisition
of other assets that will constitute Collateral, then such proceeds shall not be subject to the
mandatory prepayment provisions of Section 2.13(b) (but shall be subject to and included in the
amounts and limitations set forth in the last sentence of this definition) except to the extent not
so used at the end of such 365-day period, at which time such proceeds shall be subject to the
mandatory prepayment provisions of Section 2.13(b); provided further,
however, that, subject to the last sentence of this definition, if (A) such proceeds shall
result from an Asset Sale or Recovery Event to the extent involving assets, rights or other
property of a Subsidiary that is not a Loan Party, (B) the terms of any Indebtedness of such
Subsidiary require that such proceeds be applied to repay such Indebtedness, (C) the Company shall
deli
ver a certificate of a Financial Officer to the Administrative Agent at the time of receipt
thereof setting forth the Company’s intent to use such proceeds to repay such Indebtedness of such
Subsidiary solely to the extent required thereby and, if such Indebtedness to be repaid is
revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto, within
365 days of receipt of such proceeds and (D) no Default or Event of Default shall have occurred and
shall be continuing at

29

 

the time of such certificate or at the proposed time of the application of such proceeds, then
such proceeds shall not be subject to the mandatory prepayment provisions of Section 2.13(b) (but
shall be subject to and included in the amounts and limitations set forth in the last sentence of
this definition) except to the extent not so used at the end of such 365-day period, at which time
such proceeds shall be subject to the mandatory prepayment provisions of Section 2.13(b).
Notwithstanding the foregoing, (a) all Net Asset Sale Proceeds received in any fiscal year in
excess of $100,000,000 (excluding any Excluded Proceeds) and (b) all Net Asset Sale Proceeds
received at any time after the aggregate amount of Net Asset Sale Proceeds that are deemed to not
constitute Net Cash Proceeds as a result of the reinvestment rights and repayment rights set forth
in the immediately preceding sentence shall exceed $500,000,000 (excluding any amounts that are
used to repay Term Loans pursuant to Section 2.13(b) as a result of the failure to reinvest such
amounts within 365 days of receipt thereof as provided above) shall in each case immediately
constitute Net Cash Proceeds for purposes of Section 2.13(b) and all other purposes hereunder and
the provisions set forth in the immediately preceding sentence shall not apply thereto.

     “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 existing as of the Restatement Date and (b) Additional Non-Recourse Indebtedness of any
Subsidiary that is not a Loan Party as of the Restatement Date (so long as such Subsidiary does not
become (and remain for a period of 365 days or more) a Subsidiary Guarantor after the Restatement
Date) or any Subsidiary that becomes a Subsidiary after the Restatement Date.

     “NRG Mid-Atlantic” shall mean NRG Mid-Atlantic Generating LLC, a Delaware limited
liability company that is a wholly owned Subsidiary.

     “NRG Northeast” shall mean NRG Northeast Generating LLC, a Delaware limited liability
company that is a wholly owned Subsidiary.

     “NRG Plan” shall mean the plan of reorganization filed by the Company and certain of
its Affiliates, including NRG Power Marketing, under Chapter 11 of the Bankruptcy Code, as the same
was modified and confirmed by the Bankruptcy Court in an order dated November 24, 2003, a copy of
which is attached hereto as Exhibit I, which, among other things, provides for the Refinancing
Transactions.

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     “NRG Power Marketing” shall have the meaning assigned to such term in the preamble.

     “NRG South Central” shall mean NRG South Central Generating LLC, a Delaware limited
liability company that is a wholly owned Subsidiary.

     “Obligations” shall have the meaning assigned to such term in the Collateral Trust
Agreement.

     “Omnibus Assignment” shall mean Omnibus Assignment, in the form of Exhibit J, executed
and delivered by the administrative agent under the Original Credit Agreement, on behalf of the
lenders under the Original Credit Agreement, to the Administrative Agent, on behalf of the Lenders.

     “Original Credit Agreement” shall mean this Agreement, including all amendments hereto
and waivers hereof effective prior to the Restatement Date, as in effect immediately prior to the
Restatement Date.

     “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 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 Debt Representative” shall have the meaning assigned to such term in the
Collateral Trust Agreement.

     “Parity Lien Debt” shall mean (a) the Senior Notes; and (b) any other Indebtedness
(including Additional Notes) that is permitted to be incurred under Section 6.01 (i) the net
proceeds of which are used to refund, refinance, replace, defease or discharge Indebtedness of an
Excluded Subsidiary outstanding as of the Closing Date or other Parity Lien Debt if such
Indebtedness constitutes Permitted Refinancing Indebtedness; or (ii) on the date of incurrence of
such Indebtedness, after giving pro forma effect to the incurrence thereof and the application of
the proceeds therefrom, the Secured Leverage Ratio would not be greater than 2.75:1.0,
provided, in the case of each issue or series of Indebtedness referred to in this clause
(b), that (x) on or before the date on which such Indebtedness was incurred by the Company such
Indebtedness is designated by the Company, in an officers’ certificate delivered to each Parity
Debt Representative, the Administrative Agent and the Collateral Trustee on or before such date, as
Parity Lien Debt for the purposes of this Agreement and the Collateral Trust Agreement, (y) such
Indebtedness is governed by an indenture or other agreement that includes a Sharing Confirmation
and (z) 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 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 (z) 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, together with an opinion of counsel stating that

31

 

such officers’ certificate has been duly authorized by the Board of Directors of the Company
and has been duly executed and delivered, and the holders of such Indebtedness and Obligations in
respect thereof will be entitled to rely conclusively thereon).

     “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.

     “Peakers Entities” shall mean LSP Energy Limited Partnership, NRG Batesville LLC, LSP
Batesville Funding Corporation, LSP Batesville Holding LLC, LSP Energy, Inc., 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 Capital II LLC and NRG Sterlington Power LLC.

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

     “Permitted Business” shall mean the business of acquiring, constructing, managing,
developing, improving, owning and operating Facilities, as well as any other activities reasonably
related to the foregoing activities (including acquiring and holding reserves), including investing
in Facilities.

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

     “Permitted Investments” shall mean (a) any Investment in the Company or in a
Restricted Subsidiary that is a Subsidiary Guarantor; (b) any Investment in an Immaterial
Subsidiary; (c) any Investment in an Excluded Foreign Subsidiary for so long as the Excluded
Foreign Subsidiaries do not collectively own more than 20% of the consolidated assets of the
Company as of the most recent fiscal quarter end for which financial statements are publicly
available; (d) any issuance of letters of credit in an aggregate amount not to exceed $125,000,000
solely for working capital requirements and general corporate purposes of any of the Excluded
Subsidiaries; (e) any Investment in Cash Equivalents (and, in the case of Excluded Subsidiaries
only, Cash Equivalents or other liquid investments permitted under any other Credit Facility to
which it is a party); (f) any Investment by the Company or any Restricted Subsidiary in a Person,
if as a result of such Investment (i) such Person becomes a Restricted Subsidiary and a Subsidiary
Guarantor or an Immaterial Subsidiary; or (ii) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially all of its assets to, or is liquidated into,
the Company or a Restricted Subsidiary that is a Subsidiary Guarantor; (g) any Investment made as a
result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Section 6.04 hereof; (h) Investments made solely in exchange for the issuance of
Equity Interests (other than Disqualified Stock) of the Company; (i) any Investments received in
compromise or resolution of (i) obligations of trade creditors or customers that were incurred in
the ordinary course of business of the Company or any of its Restricted Subsidiaries, including
pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of
any trade creditor or customer; or (ii) litigation, arbitration

32

 

or other disputes with Persons who are not Affiliates; (j) Investments represented by Hedging
Obligations; (k) loans or advances to employees made in the ordinary course of business in an
aggregate principal amount not to exceed $1,000,000 at any one time outstanding; (l) purchase of
Indebtedness the payment or other acquisition of which is otherwise permitted by the terms of
clauses (v), (w), (x), (y) or (z) of Section 6.05(a)(iii), (m) any Investment in securities of
trade creditors or customers received in compromise of obligations of those Persons incurred in the
ordinary course of business, including pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of such trade creditors or customers; (n) negotiable
instruments held for deposit or collection in the ordinary course of business; (o) receivables
owing to the Company or any Restricted Subsidiary created or acquired in the ordinary course of
business and payable or dischargeable in accordance with customary trade terms; provided,
however, that such trade terms may include such concessionary trade terms as the Company of
any such Restricted Subsidiary deems reasonable under the circumstances; (p) payroll, travel and
similar advances to cover matters that are expected at the time of such advances ultimately to be
treated as expenses for accounting purposes and that are made in the ordinary course of business;
(q) Investments resulting from the acquisition of a Person that at the time of such acquisition
held instruments constituting Investments that were not acquired in contemplation of the
acquisition of such Person; (r) any Investment made since the Closing Date in Persons engaged
primarily in Permitted Businesses, if after giving effect to such Investment, such Person is or
will become a Restricted Subsidiary; provided that the aggregate Fair Market Value of
Investments made pursuant to this clause (r) (measured on the date each such Investment was made
and without giving effect to subsequent changes in value), when taken together with all other
Investments made pursuant to this clause (r) that are at the time outstanding, does not exceed 10%
of the consolidated assets of the Company as of the most recent fiscal quarter end for which
financial statements are publicly available; and (s) other Investments made since the Closing Date
in any Person having an aggregate Fair Market Value (measured on the date each such Investment was
made and without giving effect to subsequent changes in value), when taken together with all other
Investments made pursuant to this clause (s) that are at the time outstanding not to exceed
$200,000,000; provided, however, that if any Investment pursuant to this clause (s)
is made in any Person that is not a Restricted Subsidiary and a Subsidiary Guarantor at the date of
the making of the Investment and such Person becomes a Restricted Subsidiary and a Subsidiary
Guarantor after such date, such Investment shall thereafter be deemed to have been made pursuant to
clause (a) above, and shall cease to have been made pursuant to this clause (s).

     “Permitted Liens” shall mean (a) Liens held by the Collateral Trustee on assets of the
Company or any Subsidiary Guarantor securing (i) Secured Obligations of the Company or such
Subsidiary Guarantor relating to Indebtedness and Letters of Credit under this Agreement and (ii)
secured obligations or the Company or such Subsidiary Guarantor relating to Revolver Refinancing
Indebtedness permitted by Section 6.01(b)(i); (b) Liens held by the Collateral Trustee Equally and
Ratably securing the Senior Notes issued prior to the Restatement Date and all future Parity Lien
Debt and other Parity Lien Obligations; (c) Liens on assets of Excluded Subsidiaries securing
Indebtedness of Excluded Subsidiaries that was permitted by the terms of this Agreement to be
incurred; (d) Liens (i) in favor of the Company or any of the Subsidiary Guarantors, (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

33

 

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(b)(iv) 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 appropriate provision as is required in conformity with
GAAP has been made therefor; (i) Liens imposed by law, such as carriers’, warehousemen’s,
landlords’ and mechanics’ Liens, in each case, incurred in the ordinary course of business; (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 (i) the new 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) and (ii) the Indebtedness secured by the new Lien is
not increased to any amount greater than the sum of (x) the outstanding principal amount or, if
greater, committed amount, of the Permitted Refinancing Indebtedness and (y) an amount necessary to
pay any fees and expenses, including premiums, related to such refinancing, refunding, extension,
renewal or replacement; (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 Company 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 Company and its Restricted
Subsidiaries; (o) inchoate statutory Liens arising under ERISA incurred in the ordinary course of
business; (p) Liens on property of a Person existing at the time such Person is merged with or into
or consolidated with the Company or any Subsidiary, provided that such Liens were in
existence prior to the contemplation of such merger or consolidation and do not extend to any
assets other than those of the Person merged into or consolidated with the Company or the
Subsidiary; (q) Liens on property (including Capital Stock) existing at the time of acquisition of
the property by the Company or any Subsidiary, provided that such Liens were in existence
prior to, such acquisition, and not incurred in contemplation of, such acquisition; (r) Liens to
secure obligations with respect to (i) contracts (other than for Indebtedness) for commercial and
trading activities in the ordinary course of business for the purchase, transmission, distribution,
sale, lease or hedge of any energy related commodity or service, (ii) agreements relating to
Hedging Obligations or netting agreements representing commodity price contracts or derivatives or
(iii) Specified Hedging Agreements; (s) Liens arising from UCC financing sta
tements 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 that is an Excluded Subsidiary as of the Closing Date; (u) Liens granted
in favor of Xcel Energy, Inc. pursuant to the Xcel Settlement Agreement as in effect on the Closing
Date on the Company’s interest in all revenues received

34

 

by the Company pursuant to the Facility Instruments; and (v) Liens incurred in the ordinary
course of business of the Company or any Subsidiary with respect to obligations that do not exceed
$25,000,000 at any one time outstanding.

     “Permitted Refinancing Indebtedness” shall mean any Indebtedness of the Company 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 Company 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 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; (c) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Secured Obligations
hereunder, such Permitted Refinancing Indebtedness is subordinated in right of payment to the
Secured 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 Company (and may be
guaranteed by any Subsidiary Guarantor) 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 Second Priority Secured Indebtedness” shall mean Indebtedness of the
Company that is secured by Liens on the Collateral granted in favor of the Collateral Trustee;
provided that such Liens are subordinate to the Liens securing the Secured Obligations
hereunder in the manner set forth in, and are otherwise subject to, the Collateral Trust Agreement.

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

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

     “Predecessor Security Documents” shall mean the “Security Documents” as such term is
defined herein immediately prior to the amendment and restatement hereof on the Restatement Date.

     “Preferred Stock” shall mean the 4% Convertible Perpetual Preferred Stock, par value
$0.01 per share, of the Company issued prior to the Restatement Date.

35

 

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

     “Prime Rate” shall mean the rate of interest per annum publicly announced from time to
time by Credit Suisse First Boston as its prime rate in effect at its principal office in New York
City; 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.

     “Pro Forma Cost Savings” shall mean, with respect to any period, reductions in costs
and related adjustments that occurred during the four-quarter reference period or after the end of
the four-quarter reference period and on or prior to the transaction date that were (a) directly
attributable to an Asset Acquisition or Asset Sale and calculated on a basis that is consistent
with Article 11 of Regulation S-X under the Securities Act or (b) actually implemented by the
Company or the business that was the subject of such Asset Acquisition or Asset Sale within six
months of the date of the Asset Acquisition or Asset Sale and that are supportable and quantifiable
by the underlying accounting records of such business, as if, in the case of each of clauses (a)
and (b), all such reductions in costs and related adjustments had been effected as of the beginning
of such period.

     “Pro Rata Percentage” of (a) any Revolving Credit Lender at any time shall mean the
percentage of the Total Revolving Credit Commitment represented by such Lender’s Revolving Credit
Commitment and (b) any Funded L/C Lender at any time shall mean the percentage of the Total
Credit-Linked Deposit represented by such Lender’s Credit-Linked Deposit. In the event the
Revolving Credit Commitments shall have expired or been terminated, the Pro Rata Percentages of any
Revolving Credit Lender shall be determined on the basis of the Revolving Credit Commitments most
recently in effect prior thereto. In the event the Credit-Linked Deposits shall have been applied
in full to reimburse Funded L/C Disbursements or shall be returned, the Pro Rata Percentage of any
Funded L/C Lender shall be determined on the basis of the Credit-Linked Deposits most recently in
effect prior thereto.

     “PUHCA” shall mean the Public Utility Holding Company Act of 1935 and the rules and
regulations promulgated thereunder, as amended from time to time.

     “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, with respect to any Specified Hedging Agreement,
any counterparty thereto that, at the time such Specified Hedging Agreement was entered into, was a
Lender, an Agent or the Syndication Agent or an Affiliate of a Lender, an Agent or the Syndication
Agent.

     “Recovery Event” shall mean the receipt of cash proceeds 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 Company or any Subsidiary; provided that any such recovery event
or

36

 

series of related recovery events having a value not in excess of $25,000,000 shall not be
deemed to be a “Recovery Event” for purposes of Section 2.13(b).

     “Refinancing Transactions” shall mean (a) the issuance of the Senior Notes, (b) the
entering into of the Original Credit Agreement and (c) the application of the proceeds from the
issuance of the Senior Notes on December 23, 2003, the initial borrowing of term loans under the
Original Credit Agreement and cash on hand to (i) repay certain notes (including accrued interest)
issued by NRG Northeast, (ii) repay certain notes (including accrued interest) issued by NRG South
Central, (iii) repay certain indebtedness (including accrued interest) of NRG Mid-Atlantic, (iv)
pay a settlement amount associated with the repayment of the notes described in clauses (i) and
(ii), (v) make a $500,000,000 distribution to certain of the Company’s unsecured creditors pursuant
to the NRG Plan, (vi) pre-fund the $250,000,000 credit-linked deposits under the Original Credit
Agreement and (v) pay fees and expenses relating to the offering of the Senior Notes and the
entering into of the Original Credit Agreement.

     “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.

     “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.

     “Reorganization Events” shall mean (a) the effectiveness of the NRG Plan; (b) the
following actions pursuant to the NRG Plan: (i) the cancellation of all of the Company’s existing
Capital Stock and the distribution to unsecured creditors of a combination of new common stock of
the Company and up to $1,040,000,000 in cash, (ii) the issuance of the Xcel Note, (iii) the making
of adjustments to the Company’s consolidated financial statements for “fresh-start” reporting under
GAAP; (c) the settlement with Xcel Energy Inc. pursuant to the Xcel Settlement Agreement under
which the Company is expected to receive $640,000,000 from Xcel Energy Inc. in cash (and, under
certain circumstances, its common stock) to be paid in three separate installments; (d) the
distribution of $515,000,000 of cash received by the Company from Xcel

37

 

Energy Inc. to the Company’s creditors; (e) as a result of the Company achieving certain
liquidity measures in September 2004, the distribution of an additional $25,000,000 of the amount
described in clause (c) to the Company’s creditors; and (f) the use by the Company of $100,000,000
of the amount described in clause (c) for any purpose, subject to the restrictions contained in
this Agreement and the Senior Note Documents.

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

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

     “Required Lenders” shall mean, at any time, the Majority Revolving Credit Lenders and
the Majority Term Lenders, each voting as a separate class.

     “Required Prepayment Percentage” shall mean (a) in the case of any Asset Sale or
Recovery Event, 100%; and (b) in the case of any Adjusted Excess Cash Flow, if on the date of the
applicable prepayment, the Company’s issuer credit rating (in the case of S&P) or long term senior
implied rating (in the case of Moody’s) is (i) BB or lower from S&P or Ba2 or lower from Moody’s,
50%, (ii) BB+ or higher from S&P and Ba1 or higher from Moody’s (but not meeting the ratings
described in clause (iii)), 25% or (iii) BBB- or higher from S&P and Baa3 or higher from Moody’s,
0%.

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

     “Restricted Investment” shall mean an Investment other than a Permitted Investment.

     “Restricted Payment” shall have the meaning assigned to such term in Section 6.05.

     “Restricted Subsidiary” of a specified Person shall mean, with respect to such Person,
(a) any corporation, association or other business entity of which more than 50% of the total
voting power of shares of Capital Stock entitled (without regard to the occurrence of any
contingency and after giving effect to any voting agreement or stockholders’ agreement that
effectively transfers voting power) to vote in the election of directors, managers or trustees of
the corporation, association or other business entity is at the time owned or controlled, directly
or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and (b) any partnership (i) the sole general partner or the managing general
partner of which is such Person or a Subsidiary of such Person or (ii) the only general partners of
which are that Person or one or more Subsidiaries of that Person (or any combination thereof), in
the case of each of clauses (a) and (b), that is not an Unrestricted Subsidiary. Unless otherwise
indicated, any reference to a “Restricted Subsidiary” shall be deemed to be a reference to a
Restricted Subsidiary of the Company. On the Restatement Date, all the Subsidiaries of the Company
are Restricted Subsidiaries of the Company.

     “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 the Revolving Credit Commitments hereunder; provided that (a) the available
commitments under such New Revolver shall not exceed $150,000,000, (b) the Revolving Loan

38

 

Borrowers shall be the only borrowers under such New Revolver and the 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, 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 substantially the same as the covenants contained herein,
(d) the Indebtedness under such New Revolver, if secured, is secured only by Liens on the
Collateral granted in favor of the Collateral Trustee that are subject to the terms of the
Collateral Trust Agreement, (e) if such New Revolver is secured, the administrative agent in
respect of such New Revolver executes and delivers a Collateral Trust Joinder as required by the
Collateral Trust Agreement and (f) if such New Revolver is secured, the secured parties with
respect to such New Revolver agree in writing for the enforceable benefit of all Secured Parties
hereunder that such secured parties are bound by the provisions set forth in the Collateral Trust
Agreement relating to the order of application of proceeds from the enforcement of Liens upon the
Collateral to the same extent that the Secured Parties are bound by such provisions as of the
Restatement Date.

     “Revolving Credit Borrowing” shall mean a Borrowing comprised of Revolving Loans.

     “Revolving Credit Commitment” shall mean, with respect to each Lender, the commitment,
if any, of such Lender to make Revolving Loans (and to acquire participations in Revolving Letters
of Credit and Swingline 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 Revolving
Credit 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 in accordance with Section 9.04.

     “Revolving Credit Exposure” shall mean, with respect to any Lender at any time, the
aggregate principal amount at such time of all outstanding Revolving Loans of such Lender, plus the
aggregate amount at such time of such Lender’s Revolving L/C Exposure, plus the aggregate amount at
such time of such Lender’s Swingline Exposure.

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

     “Revolving Credit Maturity Date” shall mean December 24, 2007.

     “Revolving Issuing Bank Fees” shall have the meaning assigned to such term in Section
2.05(c).

     “Revolving L/C Commitment” shall mean the commitment of the Issuing Bank to issue
Revolving Letters of Credit pursuant to Section 2.23.

     “Revolving L/C Disbursement” shall mean a payment or disbursement made by the Issuing
Bank pursuant to a Revolving Letter of Credit.

     “Revolving L/C Exposure” shall mean, at any time, the sum of (a) the aggregate undrawn
amount of all Revolving Letters of Credit at such time and (b) the aggregate amount of all
Revolving L/C Disbursements that have not been reimbursed at such time. The Revolving L/C

39

 

Exposure of any Revolving Credit Lender at any time shall equal its Pro Rata Percentage of the
aggregate Revolving L/C Exposure at such time.

     “Revolving L/C Fee Payment Date” shall have the meaning assigned to such term in
Section 2.05(c).

     “Revolving L/C Participation Fee” shall have the meaning assigned to such term in
Section 2.05(c).

     “Revolving Letter of Credit” shall mean, at any time, any Letter of Credit that has
been designated by a Revolving Loan Borrower (or deemed designated) as a Revolving Letter of Credit
in accordance with the provisions of Section 2.23.

     “Revolving Loan Borrowers” means the Company and NRG Power Marketing.

     “Revolving Loans” shall mean the revolving loans made by the Lenders to the Revolving
Loan Borrowers pursuant to clause (b) of Section 2.01.

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

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

     “Secured Debt” shall have the meaning assigned to such term in the Collateral Trust
Agreement.

     “Secured Leverage Ratio” shall mean, on any date, the ratio of (a) the aggregate
principal amount of Secured Debt outstanding on such date plus all Indebtedness of Restricted
Subsidiaries outstanding on such date including Non-Recourse Indebtedness (and, for this purpose,
letters of credit will be deemed to have a principal amount equal to the maximum potential
liability of the Company and its Restricted Subsidiaries thereunder) to (b) the aggregate amount of
the Company’s Consolidated EBITDA for the most recent four-quarter period for which financial
information is available. In addition, for purposes of calculating the Secured Leverage Ratio (i)
acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries,
including through mergers or consolidations or acquisitions of assets, or any Person or any of its
Restricted Subsidiaries acquired by merger, consolidation or the acquisition of all or
substantially all of its assets by the specified Person or any of its Restricted Subsidiaries, and
including any related financing transactions and including increases in ownership of Restricted
Subsidiaries, during the four-quarter reference period or subsequent to such reference period and
on or prior to the date on which the event for which the calculation of the Secured Leverage Ratio
is made (the “Leverage Calculation Date”) will be given pro forma effect in accordance with
Regulation S-X under the Securities Act) as if they had occurred on the first day of the
four-quarter reference period; (ii) the Consolidated EBITDA attributable to discontinued
operations, as determined in accordance with GAAP, and operations or businesses (and ownership
interests therein) disposed of prior to the Leverage Calculation Date, will be excluded; (iii) any
Person that is a Restricted Subsidiary on the Leverage Calculation Date will be deemed to have been
a Restricted Subsidiary at all times during such four-quarter period; (iv) any Person that is not
a Restricted Subsidiary on the Leverage Calculation Date will be deemed

40

 

not to have been a Restricted Subsidiary at any time during such four-quarter period; and (v)
if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness
will be calculated as if the rate in effect on the Leverage Calculation Date had been the
applicable rate for the entire period (taking into account any Hedging Obligation applicable to
such Indebtedness if such Hedging Obligation has a remaining term as at the Leverage Calculation
Date in excess of 12 months).

     “Secured Obligations” shall have the meaning assigned to such term in the Guarantee
and Collateral Agreement.

     “Secured Parties” shall mean the Administrative Agent, the Collateral Agent, the
Syndication Agent, the Co-Documentation Agents, 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 Guarantee and 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 any Subsidiary
Guarantor under the Guarantee and Collateral Agreement or the Collateral Trust Agreement.

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

     “Security Documents” shall mean the Guarantee and Collateral Agreement, the Mortgages,
the Control Agreements, the Intellectual Property Security Agreements, the Collateral Trust
Agreement 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.

     “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 the Company’s 8% Second Priority Senior Secured Notes due
2013, in an aggregate principal amount of $1,725,000,000, including any notes issued by the Company
in full exchange for, and as contemplated by, the Senior Notes with substantially identical terms
as the Senior Notes.

     “Sharing Confirmation” shall have the meaning assigned to such term in the 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 Restatement Date.

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

     “Specified Assets Held for Sale” shall mean the assets set forth on Schedule 1.01(g)
(which shall describe such assets and indicate their anticipated date of sale).

41

 

     “Specified Hedging Agreement” shall mean any interest rate or foreign exchange Hedging
Agreement entered into by a Borrower or any Subsidiary Guarantor and any Qualified Counterparty.

     “Specified Joint Venture Sale” shall mean the sale after the Closing Date by the
Company or a Subsidiary of its Equity Interest in Enfield Energy Centre Limited or TermoRio S.A. to
one or more holders of the remaining Equity Interests therein pursuant to the terms of the joint
venture agreements relating thereto.

     “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 Loan) is subject for eurocurrency funding (currently referred
to as “Eurocurrency Liabilities” in Regulation D of the Board). Eurodollar 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 (a) 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, or (b) that
is, at the time any determination is made, otherwise controlled 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 of the Company.

     “Subsidiary Guarantor” shall mean, initially, each Subsidiary specified on Schedule
1.01(h) and, at any time thereafter, shall include each other Subsidiary that is not (a) an
Excluded Foreign Subsidiary or (b) an Excluded Project Subsidiary at such time.

     “Swingline Commitment” shall mean the commitment of the Swingline Lender to make loans
pursuant to Section 2.22, as the same may be reduced from time to time pursuant to Section 2.09 .

     “Swingline Exposure” shall mean, at any time, the aggregate principal amount at such
time of all outstanding Swingline Loans. The Swingline Exposure of any Revolving Credit

42

 

Lender at any time shall equal its Pro Rata Percentage of the aggregate Swingline Exposure at
such time.

     “Swingline Lender” shall mean Credit Suisse First Boston in its capacity as lender of
Swingline Loans hereunder.

     “Swingline Loan” shall mean any loan made by the Swingline Lender pursuant to Section
2.22.

     “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 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 (including any Term Loan extended pursuant to Section 2.02(f) or resulting from a conversion
pursuant to Section 2.09(d)).

     “Term Loan Borrower” shall mean the Company.

     “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
Restatement Date is $450,000,000.

     “Term Loan Maturity Date” shall mean December 24, 2011.

     “Term Loans” shall mean the term loans made by the Lenders to the Term Loan Borrower
pursuant to Section 2.01(a), the term loans extended pursuant to Section 2.02(f) and the term loans
resulting from a conversion pursuant to Section 2.09(d).

     “Total Credit-Linked Deposit” shall mean, at any time, the sum of all Credit-Linked
Deposits at such time, as the same may be reduced from time to time pursuant to Section

43

 

2.02(f), 2.09(b) or 2.09(d). The initial amount of the Total Credit-Linked Deposit on the
Restatement Date is $350,000,000.

     “Total Debt” shall mean, at any time, the aggregate amount of Indebtedness of the
Company and the 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.

     “Total Revolving Credit Commitment” shall mean, at any time, the aggregate amount of
the Revolving Credit Commitments, as in effect at such time. The initial Total Revolving Credit
Commitment on the Restatement Date is $150,000,000.

     “Transactions” shall mean, collectively, (a) the execution, delivery and performance
by the Loan Parties of the Loan Documents to which they are a party, (b) the borrowings hereunder,
the issuance of Letters of Credit and the use of proceeds of each of the foregoing, (c) the
granting of Liens pursuant to the Security Documents and (d) any other transactions entered into in
connection with any of the foregoing.

     “Type”, when used in respect of any Loan or Borrowing, shall refer to the Rate by
reference to which interest on such Loan or on the Loans comprising such 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 (other than NRG Power Marketing)
that is designated by the Board of Directors of the Company as an Unrestricted Subsidiary pursuant
to a board resolution, but only to the extent that such Subsidiary (a) has no Indebtedness other
than Non-Recourse Indebtedness; (b) except as permitted by Section 6.06 hereof, is not party to any
agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary
unless the terms of any such agreement, contract, arrangement or understanding are no less
favorable to the Company or such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of the Company; (c) is a Person with respect to which
neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation
(i) to subscribe for additional Equity Interests or (ii) 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 Company or any of its Restricted
Subsidiaries except as otherwise permitted by this Agreement. Notwithstanding anything else in
this Agreement to the contrary, NRG Power Marketing shall not be an Unrestricted Subsidiary under
this Agreement at any time. Any designation of a Subsidiary as an Unrestricted Subsidiary will be
evidenced to the Administrative Agent by filing with the Administrative Agent a certified copy of
the board resolution giving effect to such designation and an officers’ certificate certifying that
such designation complied with the conditions set forth in Section 6.09 and was permitted by
Section 6.05. If, at any time, any

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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 will be deemed to be incurred by a 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
Company will be in default of such covenant. The Board of Directors of the Company 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.

     “U.S. Person” shall have the meaning assigned to such term in the definition of “Net
Cash Proceeds.”

     “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.

     “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 Company.

     “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 Cash” shall mean all amounts paid in cash by Xcel Energy Inc. to the Company or
any of the Subsidiaries after the Closing Date in connection with the Xcel Settlement Agreement.

     “Xcel Note” shall mean the unsecured promissory note made by the Company in favor of
Xcel Energy Inc. in a principal amount of $10,000,000 pursuant to the NRG Plan.

     “Xcel Settlement Agreement” shall mean the Settlement Agreement delivered as of the
effective date of the NRG Plan by and among Xcel Energy Inc., the Company and each of the
Subsidiaries party thereto, which was approved by the Bankruptcy Court on November 24, 2003.

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     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 Trustee’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 Company notifies the Administrative Agent
that the Company wishes to amend any covenant in Article VI or any related definition to eliminate
the effect of any change in GAAP occurring after the Restatement Date on the operation of such
covenant (or if the Administrative Agent notifies the Company that the Required Lenders wish to
amend Article VI or any related definition for such purpose), then the Company’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 Company and the Required Lenders.

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

     SECTION 1.04.   Pro Forma Calculations. All pro forma calculations
permitted or required to be made by the Company or any Subsidiary pursuant to this Agreement shall
(a) include only those adjustments that (i) would be permitted or required by Regulation S-X under
the Securities Act of 1933, as amended, or (ii) were actually implemented by the Company or the
business that was the subject of an Asset
Acquisition or Asset Sale within six months of the date of the Asset Acquisition or Asset Sale
and that are supportable and quantifiable by the underlying accounting records of such business and
(b) be certified to by a Financial Officer of the Company as having been prepared in good faith
based upon reasonable assumptions.

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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, (a) each Term Lender agrees,
severally and not jointly, to re-evidence and/or fund a Term Loan to the Term Loan Borrower on the
Restatement Date in a principal amount not to exceed its Term Loan Commitment, and all Term Loans
under the Original Credit Agreement and outstanding on the Restatement Date shall be re-evidenced
as Term Loans hereunder, (b) each Revolving Credit Lender agrees, severally and not jointly, to
re-evidence and/or fund Revolving Loans to the Revolving Loan Borrowers, at any time and from time
to time after the Restatement Date and until the earlier of the Revolving Credit Maturity Date and
the termination of the Revolving Credit Commitment of such Revolving Credit Lender in accordance
with the terms hereof, in an aggregate principal amount at any time outstanding that will not
result in such Revolving Credit Lender’s Revolving Credit Exposure exceeding such Revolving Credit
Lender’s Revolving Credit Commitment, and all Revolving Loans and Revolving Credit Commitments
under the Original Credit Agreement outstanding on the Restatement Date shall be re-evidenced as
Revolving Loans and Revolving Credit Commitments hereunder, and (c) each Funded L/C Lender agrees,
severally and not jointly, to re-evidence and/or fund its Credit-Linked Deposit with the
Administrative Agent on the Restatement Date in accordance with Section 2.24, and all Credit-Linked
Deposits under the Original Credit Agreement and outstanding on the Restatement Date shall be
re-evidenced as Credit-Linked Deposits hereunder. Within the limits set forth in clause (b) of the
preceding sentence and subject to the terms, conditions and limitations set forth herein, the
Revolving Loan Borrowers may borrow, pay or prepay and reborrow Revolving Loans. Amounts paid or
prepaid in respect of Term Loans may not be reborrowed.

     SECTION 2.02.   Loans . (a) Each Loan (other than Swingline
Loans) shall be made as part of a Borrowing consisting of Loans of the same Class and Type made by
the Lenders ratably in accordance with their respective Commitments of the applicable Class;
provided, however, that the failure of any Lender to make any 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 Loan required to be made by such other Lender). Except for Loans deemed made pursuant
to Section 2.02(f) and subject to Section 2.22 relating to Swingline Loans, the Loans comprising
any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of
$1,000,000 and not less than $5,000,000 or (ii) equal to the remaining available balance of the
applicable Commitments.

     (b)   Subject to Sections 2.08 and 2.15, each Borrowing shall be comprised entirely
of ABR Loans or Eurodollar Loans as the applicable Borrower may request pursuant to Section 2.03;
provided that no Borrowings may be converted into or continued as a Eurodollar Borrowing
having an Interest Period in excess of one month prior to the date which is 30 days after the
Restatement Date. Each Lender may at its option make any Eurodollar Loan by causing any domestic
or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise
of such option shall not affect the obligation of the applicable Borrower to repay such Loan in
accordance with the terms of this Agreement. Borrowings of more than one Type may be outstanding
at the same time; provided, however, that the Borrowers shall not be entitled to

47

 

request any Borrowing that, if made, would result in more than ten 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)   Except with respect to Loans made pursuant to Section 2.02(f) or Section
2.09(d) and subject to Section 2.22 relating to Swingline Loans, each Lender shall make each 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 applicable 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 applicable 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 applicable
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 applicable Borrower to but excluding the date such amount is repaid to the
Administrative Agent at (i) in the case of the applicable Borrower, the interest rate applicable at
the time to the 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 manifest error). If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount shall constitute such Lender’s Loan as
part of such Borrowing for purposes of this Agreement.

     (e)   Notwithstanding any other provision of this Agreement, the Borrowers shall not
be entitled to request any Revolving Credit Borrowing which is a Eurodollar Borrowing if the
Interest Period requested with respect thereto would end after the Revolving Credit Maturity
Date.

     (f)   If the Issuing Bank shall not have received from the applicable Borrower the
payment required to be made by Section 2.23(e) with respect to a Revolving Letter of Credit within
the time specified in such Section, the Issuing Bank will promptly notify the Administrative Agent
of the Revolving L/C Disbursement and the Administrative Agent will promptly notify each Revolving
Credit Lender of such Revolving L/C Disbursement and its Pro Rata Percentage thereof. Each
Revolving Credit Lender shall pay by wire transfer of immediately available funds to the
Administrative Agent not later than 2:00 p.m., New York

48

 

City time, on such date (or, if such
Revolving Credit Lender shall have received such notice later than 12:00 (noon), New York City
time, on any day, not later than 10:00 a.m., New York City time, on the immediately following
Business Day), an amount equal to such Lender’s Pro Rata Percentage of such Revolving L/C
Disbursement (it being understood that such amount shall be deemed to constitute an ABR Revolving
Loan of such Lender and such payment shall be deemed to have reduced the Revolving L/C Exposure),
and the Administrative Agent will promptly pay to the Issuing Bank amounts so received by it from
the Revolving Credit Lenders. The Administrative Agent will promptly pay to the Issuing Bank any
amounts received by it from the applicable Borrower pursuant to Section 2.23(e) prior to the time
that any Revolving Credit Lender makes any payment pursuant to this paragraph; any such amounts
received by the Administrative Agent thereafter will be promptly remitted by the Administrative
Agent to the Revolving Credit Lenders that shall have made such payments and to the Issuing Bank,
as their interests may appear. If any Revolving Credit Lender shall not have made its Pro Rata
Percentage of such Revolving L/C Disbursement available to the Administrative Agent as provided
above, such Lender and the applicable Borrower severally agree to pay interest on such amount, for
each day from and including the date such amount is required to be paid in accordance with this
paragraph to but excluding the date such amount is paid, to the Administrative Agent for the
account of the Issuing Bank at (i) in the case of the applicable Borrower, a rate per annum equal
to the interest rate applicable to Revolving Loans pursuant to Section 2.06(a) (in lieu of interest
which would otherwise become due to such Lender pursuant to Section 2.06), and (ii) in the case of
such Lender, for the first such day, the Federal Funds Effective Rate, and for each day thereafter,
the Alternate Base Rate.

     If the Issuing Bank shall not have received from the Term Loan Borrower the payment that it
may make pursuant to Section 2.23(e) with respect to a Funded Letter of Credit within the time
specified in such Section, the Issuing Bank will promptly notify the Administrative Agent of the
Funded L/C Disbursement and the Administrative Agent will promptly notify each Funded L/C Lender of
such Funded L/C Disbursement and its Pro Rata Percentage thereof, and the Administrative Agent
shall promptly pay to the Issuing Bank each Funded L/C Lender’s Pro Rata Percentage of such Funded
L/C Disbursement from such Funded L/C Lender’s Credit-Linked Deposit. Upon the payment made from
the Credit-Linked Deposit Account, or from funds of the Administrative Agent, pursuant to this
paragraph to reimburse the Issuing Bank for any Funded L/C Disbursement, the Term Loan Borrower
shall be deemed to have reimbursed the Issuing Bank as of such date and the Funded L/C Lenders
shall be deemed to have extended, and the Term Loan Borrower shall be deemed to have accepted, a
Term Loan in the aggregate principal amount of such payment without further action on the part of
any party, and the Total Credit-Linked Deposit shall be permanently reduced by such amount; any
amount so paid
pursuant to this paragraph shall, on and after the payment date thereof, be deemed to be Term
Loans for all purposes hereunder.

     SECTION 2.03.   Borrowing Procedure. In order to request a Borrowing (other
than a Swingline Loan or a deemed Borrowing pursuant to Section 2.02(f), as to which this Section
2.03 shall not apply), the applicable 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

49

 

Day before a proposed
Borrowing. Each Borrowing Request shall be irrevocable, shall be signed by or on behalf of the
applicable Borrower and shall specify the following information: (i) whether the Borrowing then
being requested is to be a Term Borrowing or a Revolving Credit Borrowing, and whether such
Borrowing is to be a Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing
(which shall be a Business Day); (iii) the number and location of the account to which funds are to
be disbursed (which shall be an account that complies with the requirements of Section 2.02(c));
(iv) the amount of such Borrowing; 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
applicable Borrower shall be deemed to have selected an Interest Period of one month’s duration.
The Administrative Agent shall 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 Loans; Evidence of Debt . (a)
Each Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of
each Lender (i) the principal amount of each Term Loan of such Lender made to such Borrower as
provided in Section 2.11 and (ii) the then unpaid principal amount of each Revolving Loan of such
Lender made to such Borrower on the Revolving Credit Maturity Date. Each Revolving Loan Borrower
hereby unconditionally promises to pay to the Swingline Lender the then unpaid principal amount of
each Swingline Loan made to such Revolving Loan Borrower on the earlier of the Revolving Credit
Maturity Date and the first date after such Swingline Loan is made that is the 15th day or the last
day of a calendar month and is at least three Business Days after such Swingline Loan is made.

     (b)   Each Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of the applicable Borrower to such Lender resulting from each
Loan made by such Lender to such Borrower from time to time, 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 Company upon its reasonable request (at the Company’s sole cost and
expense).

     (c)   The Administrative Agent shall maintain accounts in which it will record (i)
the amount of each 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 applicable Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder from any Borrower or any Subsidiary Guarantor and each Lender’s
share thereof, and shall provide copies of such accounts to the Company upon its reasonable request
(at the Company’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 manifest 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

50

 

affect the obligations of each Borrower to repay the Loans made to such Borrower in
accordance with the terms of this Agreement.

     (e)   Any Lender may request that Loans made by it hereunder be evidenced by a
promissory note. In such event, the applicable Borrower shall execute and deliver to such Lender a
promissory note payable to such Lender and its registered assigns (i) in the form of Exhibit L, if
such promissory note relates to Revolving Credit Borrowings or (ii) in the form of Exhibit M, if
such promissory note relates to Term Borrowings, or, in any such case, 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 Company agrees to pay to
each Lender, through the Administrative Agent, on the last Business Day of March, June, September
and December in each year (beginning with March 31, 2005) and on each date on which any Commitment
of such Lender shall expire or be terminated as provided herein, a commitment fee (a
“Commitment Fee”) equal to the applicable Commitment Fee Rate in effect from time to time
on the average daily unused amount of the Commitments of such Lender (other than the Swingline
Commitment) during the preceding quarter (or shorter or longer period commencing with the
Restatement Date or ending with the Revolving Credit Maturity Date or the date on which the
Commitments of such Lender shall expire or be terminated). All Commitment Fees shall be computed
on the basis of the actual number of days elapsed in a year of 360 days. The Commitment Fee due to
each Lender shall commence to accrue on the Restatement Date and shall cease to accrue on the date
on which the Commitment of such Lender shall expire or be terminated as provided herein. For
purposes of calculating Commitment Fees with respect to Revolving Credit Commitments only, no
portion of the Revolving Credit Commitments shall be deemed utilized under Section 2.17 as a result
of outstanding Swingline Loans.

     (b)   The Company 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 Company and
the Administrative Agent, including pursuant to the Engagement Letter (the “Administrative
Agent Fees”).

     (c)   Each Revolving Loan Borrower agrees to pay (i) to each Revolving Credit
Lender, through the Administrative Agent, on the last Business Day of March, June, September and
December of each year (beginning with March 31, 2005) and on the date on which the Revolving Credit
Commitment of such Lender shall be terminated as provided herein (each, a “Revolving L/C Fee
Payment Date”) a fee (a “Revolving L/C Participation Fee”) calculated on such Lender’s
Pro Rata Percentage of the daily aggregate Revolving L/C Exposure (excluding the portion thereof
attributable to unreimbursed Revolving L/C Disbursements which are earning interim interest
pursuant to Section 2.23(h)) during the preceding quarter (or shorter or longer period commencing
with the Restatement Date or ending with the Revolving Credit Maturity Date or the date on which
all Revolving Letters of Credit have been canceled or have expired and the Revolving Credit
Commitments of all Lenders shall have been terminated) at a rate per annum equal to the Applicable
Margin used to determine the interest rate on Revolving Credit

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Borrowings comprised of Eurodollar
Loans pursuant to Section 2.06, and (ii) to the Issuing Bank with respect to each outstanding
Revolving Letter of Credit issued for the account of (or at the request of) such Borrower a
fronting fee, which shall accrue at the rate of 1/4 of 1% per annum or such other lower rate as shall
be separately agreed upon between such Borrower and the Issuing Bank, on the drawable amount of
such Revolving Letter of Credit, payable quarterly in arrears on each Revolving L/C Fee Payment
Date after the issuance date of such Revolving Letter of Credit, as well as the Issuing Bank’s
standard and reasonable fees with respect to the issuance, amendment, renewal or extension of any
Revolving Letter of Credit issued for the account of (or at the request of) such Borrower or
processing of drawings thereunder (the fees in this clause (ii), collectively, the “Revolving
Issuing Bank Fees”). All Revolving L/C Participation Fees and Revolving Issuing Bank Fees
shall be computed on the basis of the actual number of days elapsed in a year of 360 days.

     (d)   Subject to the provisions of Section 2.07, the Term Loan Borrower agrees to
pay (i) to each Funded L/C Lender, through the Administrative Agent, on the last Business Day of
March, June, September and December of each year (beginning with March 31, 2005) and on the date on
which the Credit-Linked Deposits are returned to the Funded L/C Lenders (each, a “Funded L/C
Fee Payment Date”) a fee (a “Funded L/C Participation Fee”) calculated on such Lender’s
Pro Rata Percentage of the daily amount of the Total Credit-Linked Deposit (excluding the portion
thereof attributable to unreimbursed Funded L/C Disbursements which are earning interim interest
pursuant to Section 2.23(h)) during the preceding quarter (or shorter or longer period commencing
with the Restatement Date or ending with the Funded Letter of Credit Maturity Date or the date on
which the entire amount of such Lender’s Credit-Linked Deposit is returned to it) at a rate per
annum equal to the Applicable Margin used to determine the interest rate on Term Borrowings
comprised of Eurodollar Loans pursuant to Section 2.06, (ii) to each Funded L/C Lender, through the
Administrative Agent, the fees referred to in the last sentence of Section 2.24(b) and (iii) to the
Issuing Bank with respect to each outstanding Funded Letter of Credit (including each Existing
Letter of Credit) issued for the account of (or at the request of) such Borrower a fronting fee,
which shall accrue at the rate of 1/4 of 1% per annum or such other lower rate as shall be separately
agreed upon between such Borrower and the Issuing Bank, on the drawable amount of such Funded
Letter of Credit, payable quarterly in arrears on each Funded L/C Fee Payment Date after the
issuance date of such Funded Letter of Credit, as well as
the Issuing Bank’s standard and reasonable fees with respect to the issuance, amendment,
renewal or extension of any Funded Letter of Credit issued for the account of (or at the request
of) such Borrower or processing of drawings thereunder (the fees in this clause (ii), collectively,
the “Funded Issuing Bank Fees”). All Funded L/C Participation Fees and Funded Issuing Bank
Fees shall be computed on the basis of the actual number of days elapsed in a year of 360 days.

     (e)   All optional prepayments of Term Loans and all optional reductions of the
Total Credit-Linked Deposit shall be accompanied by the payment of a prepayment fee (each, a
“Prepayment Fee”) equal to 1.0% of the aggregate amount of such prepayment or reduction, as
the case be, if such prepayment or reduction, as the case may be, is made during the period
beginning on the Restatement Date and ending on the date that is six months thereafter.

     (f)   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, except that
the

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Issuing Bank Fees shall be paid directly to the Issuing Bank. Once paid, none of the Fees
shall be refundable under any circumstances.

     SECTION 2.06.   Interest on Loans . (a) Subject to the
provisions of Section 2.07, the Loans comprising each ABR Borrowing, including each Swingline Loan,
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 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 Loan shall be payable on the Interest Payment Dates
applicable to such 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 be conclusive
absent manifest error.

     SECTION 2.07.   Default Interest. If a Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount becoming due and payable
hereunder or under any other Loan Document, by acceleration or otherwise, such 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 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 Revolving 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 or the
determination of the Benchmark LIBO Rate on any day (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 the Benchmark LIBO Rate for such day or (b) the Administrative Agent is
advised by the Majority Revolving Credit Lenders or the Majority Term Lenders in good faith that
the Adjusted LIBO Rate for such Interest Period or the Benchmark LIBO Rate for such day will not
adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans
included in such Borrowing or such Credit-Linked Deposit, as applicable, for such Interest Period
the Administrative Agent shall, as soon as practicable thereafter, give written or fax notice of
such determination to the applicable Borrower and the Lenders. In the event of any such notice,
until the Administrative Agent shall have advised the applicable Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any request by a Borrower for a
Eurodollar Borrowing pursuant to Section 2.03 or 2.10 shall be deemed to be a request for an ABR
Borrowing, (ii) any Interest Period election that requests the conversion of

53

 

any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and (iii) the
Credit-Linked Deposits shall be invested so as to earn a return equal to the greater of the Federal
Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation. Each determination by the Administrative Agent under
this Section 2.08 shall be conclusive absent manifest error.

     SECTION 2.09.   Termination and Reduction of Commitments; Return, Reduction and
Conversion of Credit-Linked Deposits . (a) Unless previously terminated in
accordance with the terms hereof, (i) the Term Loan Commitments shall automatically terminate at
5:00 p.m., New York City time, on the Restatement Date and (ii) the Revolving Credit Commitments,
the Swingline Commitment and the Revolving L/C Commitment shall automatically terminate on the
Revolving Credit Maturity Date. If any Funded Letter of Credit remains outstanding on the Funded
Letter of Credit Maturity Date, the Term Loan Borrower shall deposit with the Administrative Agent
an amount in cash equal to 100% of the aggregate undrawn amount of such Letter of Credit to secure
the full obligations with respect to any drawings that may occur thereunder. Subject only to the
Borrowers’ compliance with their obligations under the immediately preceding sentence, any amount
of the Credit-Linked Deposits held in the Credit-Linked Deposit Account will be returned to the
Funded L/C Lenders on the Funded Letter of Credit Maturity Date pursuant to Section 2.11(b).
Notwithstanding the foregoing, all the Commitments shall automatically terminate at 5:00 p.m., New
York City time, on December 24, 2004, if the initial Credit Event shall not have occurred by such
time.

     (b)   Upon at least three Business Days’ prior irrevocable written or fax notice to
the Administrative Agent, the Company may at any time in whole permanently terminate, or from time
to time in part permanently reduce, in each case without premium or penalty, the Revolving Credit
Commitments or the Swingline Commitment; provided, however, that (i) each partial
reduction of the Revolving Credit Commitments or the Swingline Commitment shall be in an integral
multiple of $1,000,000 and in a minimum amount of $5,000,000 and (ii) the Total
Revolving Credit Commitment shall not be reduced to an amount that is less than the Aggregate
Revolving Credit Exposure then in effect. Upon at least three Business Days’ prior irrevocable
written or fax notice to the Administrative Agent, the Company may at any time in whole permanently
terminate, or from time to time permanently reduce, the Total Credit-Linked Deposit;
provided, however, that (i) each partial reduction of the Total Credit-Linked
Deposit shall be in an integral multiple of $1,000,000 and in a minimum amount of $5,000,000 and
(ii) the Total Credit-Linked Deposit shall not be reduced to an amount that would result in the
aggregate Funded L/C Exposure exceeding the Total Credit-Linked Deposit (as so reduced). In the
event the Credit-Linked Deposits shall be reduced as provided in the immediately preceding
sentence, the Administrative Agent shall return all amounts in the Credit-Linked Deposit Account in
excess of the reduced Total Credit-Linked Deposit to the Funded L/C Lenders ratably in accordance
with their Pro Rata Percentages of the Total Credit-Linked Deposit (as determined immediately prior
to such reduction).

     (c)   Each reduction in the Revolving Credit Commitments or Swingline Commitment, or
reduction of the Total Credit-Linked Deposit, hereunder shall be made ratably among the applicable
Lenders in accordance with their Pro Rata Percentages. The Company shall pay to the Administrative
Agent for the account of the applicable Lenders, on the date of each termination

54

 

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.

     (d)   In addition to the foregoing and subject to the terms hereof, so long as no
Default or Event of Default shall have occurred and be continuing, upon at least three Business
Days’ prior irrevocable written or fax notice to the Administrative Agent, the Term Loan Borrower
may, at any time and from time to time, request that any unused portion of the Total Credit-Linked
Deposit in an amount not greater than the excess of the Total Credit-Linked Deposit over the
aggregate Funded L/C Exposure be permanently converted into Term Loans, in whole or in part,
without premium or penalty; provided, however, that (i) each partial conversion
shall be an integral multiple of $1,000,000 and in a minimum amount of $5,000,000 and (ii) the
Total Credit-Linked Deposit shall not be reduced to an amount that would result in the aggregate
Funded L/C Exposure exceeding the Total Credit-Linked Deposit (as so reduced). Any such notice of
conversion shall include the date and amount of such conversion. If any such notice of conversion
is properly given, the Administrative Agent shall irrevocably and permanently fund the requested
amount in the Credit-Linked Deposit Account to the Term Loan Borrower as proceeds of Term Loans
made on such date by the Funded L/C Lenders ratably in accordance with their Pro Rata Percentages
of the Total Credit-Linked Deposit, and the amount so funded shall permanently reduce the Total
Credit-Linked Deposit; any amount so funded pursuant to this paragraph shall, on and after the
funding date thereof, be deemed to be Term Loans for all purposes hereunder.

     SECTION 2.10.   Conversion and Continuation of Borrowings. Each 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 such 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 such Borrower into a Eurodollar
Borrowing or to continue any Eurodollar Borrowing of such 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 such 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 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(a) and 2.02(b) 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 Loan of such Lender resulting from
such conversion and reducing the Loan (or portion thereof) of such Lender being converted by
an equivalent principal amount; accrued and unpaid interest on any

55

 

Eurodollar Loan (or
portion thereof) being converted shall be paid by the applicable 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 applicable 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;

          (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 Loan may be converted into, or continued as, a Eurodollar 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 applicable 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 applicable 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 applicable 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) On the
dates set forth below, or if any such date is not a Business Day, on the next preceding Business
Day (each such date being called a “Repayment Date”), the Term Loan 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

56

 

time pursuant to Sections 2.11(b), 2.12 and 2.13(e)) in an aggregate
amount equal to the sum of the principal amount of Term Loans made on the Restatement Date,
multiplied, in each case, by the percentage set forth below for such 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:

	 	 	 
	Repayment Date	 	Percentage
	March 31, 2005
	 	0.25%
	June 30, 2005
	 	0.25%
	September 30, 2005
	 	0.25%
	December 31, 2005
	 	0.25%
	March 31, 2006
	 	0.25%
	June 30, 2006
	 	0.25%
	September 30, 2006
	 	0.25%
	December 31, 2006
	 	0.25%
	March 31, 2007
	 	0.25%
	June 30, 2007
	 	0.25%
	September 30, 2007
	 	0.25%
	December 31, 2007
	 	0.25%
	March 31, 2008
	 	0.25%
	June 30, 2008
	 	0.25%
	September 30, 2008
	 	0.25%
	December 31, 2008
	 	0.25%
	March 31, 2009
	 	0.25%
	June 30, 2009
	 	0.25%
	September 30, 2009
	 	0.25%
	December 31, 2009
	 	0.25%
	March 31, 2010
	 	0.25%
	June 30, 2010
	 	0.25%
	September 30, 2010
	 	0.25%
	December 31, 2010
	 	0.25%
	March 31, 2011
	 	0.25%
	June 30, 2011
	 	0.25%
	September 30, 2011
	 	0.25%
	Term Loan Maturity Date
	 	93.25% or Remainder

     (b)   In the event and on each occasion that any Term Loan Commitments shall be
reduced or shall expire or terminate other than as a result of the making of a Term Loan, the
installments payable on each Repayment Date shall be reduced pro rata by an aggregate amount equal
to the amount of such reduction, expiration or termination.

     (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. To the extent not previously returned, all
Credit-Linked Deposits shall be returned to the Funded L/C Lenders on the Funded Letter of Credit
Maturity Date, together with accrued and unpaid fees and other amounts due hereunder.

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     (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) Each Borrower shall have
the right at any time and from time to time to prepay any Borrowing of such Borrower, in whole or
in part, 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 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 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.

     (b)   Optional prepayments of Term Loans shall be applied pro rata against the
remaining scheduled installments of principal due in respect of the Term Loans.

     (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 applicable Borrower to prepay such Borrowing by the amount stated therein on the date stated
therein. All prepayments under this Section 2.12 shall be subject to Sections 2.05(e) and 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.

     SECTION 2.13.   Mandatory Prepayments . (a) In the event of
any termination of all the Revolving Credit Commitments, each Revolving Loan Borrower shall, on the
date of such termination, repay or prepay all its outstanding Revolving Credit Borrowings and all
its outstanding Swingline Loans and replace all its outstanding Revolving Letters of Credit and/or
deposit an amount equal to the Revolving L/C Exposure in cash in a cash collateral account
established with the Collateral Agent for the benefit of the Revolving Credit Lenders. If as a
result of any partial reduction of the Revolving Credit Commitments the Aggregate Revolving Credit
Exposure would exceed the Total Revolving Credit Commitment after giving effect thereto, then the
Revolving Loan Borrowers shall, on the date of such reduction, repay or prepay Revolving Credit
Borrowings or Swingline Loans (or a combination thereof) and/or cash collateralize Revolving
Letters of Credit in an amount sufficient to eliminate such excess.

     (b)   Not later than the tenth Business Day following receipt of Net Cash Proceeds
from the completion of any Asset Sale (other than Excluded Proceeds) or the occurrence of any
Recovery Event, the Term Loan Borrower shall apply the Required Prepayment Percentage of the Net
Cash Proceeds received with respect thereto to prepay outstanding Term Loans and, thereafter, to
permanently reduce the Total Credit-Linked Deposit, such prepayment and reduction to be made in
accordance with Section 2.13(d).

     (c)   No later than the earlier of (i) 90 days after the end of each fiscal year of
the Term Loan Borrower, commencing with the fiscal year ending on December 31, 2005, and (ii) the
date on which the financial statements with respect to such period are delivered pursuant to
Section 5.04(a), the Term Loan Borrower shall prepay outstanding Term Loans and, thereafter,
permanently reduce the Total Credit-Linked Deposit, such prepayment and reduction to be made

58

 

in
accordance with Section 2.13(d), in an aggregate principal amount equal to the Required Prepayment
Percentage of Adjusted Excess Cash Flow for the fiscal year then ended.

     (d)   Notwithstanding any provision in this Agreement to the contrary, but subject
to the right of each Term Lender and each Funded L/C Lender to elect to decline all or any portion
of any prepayment or return pursuant to this Section 2.13 as described below, the amount to be
prepaid or returned on any date pursuant to this Section 2.13 shall be applied first to the
prepayment (to the extent required to be so applied) of all Term Loans outstanding on such date and
thereafter (to the extent of any residual) to the permanent return of Credit-Linked Deposits
outstanding on such date (or to be deposited in an account with the Administrative Agent if
required under the circumstances described in paragraph (e) below). No later than 5:00 p.m., New
York City time, one Business Day prior to the applicable prepayment or return date, each Term
Lender and each Funded L/C Lender may provide written notice to the Administrative Agent either (i)
setting forth the maximum amount of the aggregate amount of its Term Loans and/or Credit-Linked
Deposits that it wishes to have prepaid or returned on such date pursuant to this Section (the
“Requested Prepayment Amount”) or (ii) declining in its entirety any prepayment or return
on such date pursuant to this Section. In the event that any Term Lender or any Funded L/C Lender
shall fail to provide such written notice to the Administrative Agent within the time period
specified above, (i) 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) and (ii)
such Funded L/C Lender shall be deemed to have elected a Requested Prepayment Amount equal to
its ratable share of such mandatory return (determined based on the percentage of the aggregate
amount of the Total Credit-Linked Deposit represented by such Funded L/C Lender’s Credit-Linked
Deposits as determined immediately prior to such return and without taking into account any
Requested Prepayment Amount of any other Lender). In the event that the amount of any mandatory
prepayment or return 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, and any residual amount of any mandatory prepayment or return remaining after such
application shall be applied to the return of the Credit-Linked Deposits of the Funded L/C Lenders
as follows: (i) in the event that any such residual amount shall be equal to or exceed the
aggregate amount of all Requested Prepayment Amounts of all Funded L/C Lenders electing (or deemed
to be electing) such a return, each Funded L/C Lender electing (or deemed to be electing) such a
return shall have an amount of its Credit-Linked Deposits returned that is equal to such Funded L/C
Lender’s Requested Prepayment Amount or (ii) in the event that any such residual amount shall be
less than the aggregate amount of all Requested Prepayment Amounts of all Funded L/C Lenders
electing (or deemed to be electing) such a return, each Funded L/C Lender electing (or deemed to be
electing) such a return shall have its Credit-Linked Deposits returned in an amount equal to the
product of (A) the amount of such residual and (B) the percentage of the aggregate Requested
Prepayment Amounts of all Funded L/C Lenders electing (or deemed to be electing) such a return
represented by such Funded L/C 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

59

 

amount of all Requested Prepayment Amounts of all Term Lenders electing (or deemed to be electing)
such a prepayment, (i) 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 and (ii) no amount shall be returned in respect of the Credit-Linked Deposits.
Mandatory prepayments of outstanding Term Loans under this Agreement shall be applied pro rata
against the remaining scheduled installments due in respect of the Term Loans under Section 2.11.

     (e)   Notwithstanding any provision in this Agreement to the contrary, in the event
that any permanent reduction of the Total Credit-Linked Deposit pursuant to this Section would
result in the Funded L/C Exposure exceeding the Total Credit-Linked Deposit, the Term Loan Borrower
shall deposit cash in a cash collateral account established with the Administrative Agent pursuant
to Section 2.23(j) in the amount of such excess.

     (f)   The Term Loan Borrower shall deliver to the Administrative Agent, at the time
of each prepayment or reduction required under this Section 2.13, (i) a certificate signed by a
Financial Officer of the Term Loan Borrower setting forth in reasonable detail the calculation of
the amount of such prepayment or reduction and (ii) to the extent practicable, at least ten days
prior written notice of such prepayment or reduction (and the Administrative Agent shall promptly
provide the same to each Term Lender and Funded L/C Lender). Each notice of prepayment or
reduction shall specify the prepayment or reduction date, the Type of each Loan
being prepaid and the principal amount of each Loan (or portion thereof) to be prepaid and the
amount of any reduction of the Total Credit-Linked Deposit. All prepayments of Borrowings or
reductions of the Total Credit-Linked Deposit pursuant to this Section 2.13 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:

          (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, the Administrative Agent or the Issuing Bank (except any such reserve
requirement which is reflected in the Adjusted LIBO Rate) or

          (ii) impose on any Lender, the Administrative Agent or the Issuing Bank or
the London interbank market any other condition affecting this Agreement or Eurodollar Loans
made by such Lender or any Letter of Credit or participation therein or any Credit-Linked
Deposit,

and the result of any of the foregoing shall be to increase the cost to such Lender or the Issuing
Bank of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any
such Loan) or to increase the cost to any Lender, the Administrative Agent or the Issuing Bank of
issuing or maintaining any Letter of Credit or any Credit-Linked Deposit or purchasing or
maintaining a participation therein or to reduce the amount of any sum received or receivable by
such Lender or the Issuing Bank hereunder (whether of principal, interest or otherwise) by an

60

 

amount reasonably deemed by such Lender, the Administrative Agent or the Issuing Bank to be
material, then the Borrowers will pay to such Lender, the Administrative Agent or the Issuing Bank,
as the case may be, upon demand such additional amount or amounts as will compensate such Lender or
the Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.

     (b)   If any Lender, the Administrative Agent or the Issuing Bank 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, the Administrative Agent’s or the Issuing Bank’s
capital or on the capital of such Lender’s, the Administrative Agent’s or the Issuing Bank’s
holding company, if any, as a consequence of this Agreement or the Loans made by, or participations
in Letters of Credit purchased by, such Lender or the Letters of Credit issued by the Issuing Bank
to a level below that which such Lender, the Administrative Agent or the Issuing Bank or such
Lender’s, the Administrative Agent’s or the Issuing Bank’s holding company could have achieved but
for such Change in Law (taking into consideration such Lender’s, the Administrative Agent’s or the
Issuing Bank’s policies and the policies of such Lender’s, the Administrative Agent’s or the
Issuing Bank’s holding company with respect to capital adequacy) by an amount reasonably deemed by
such Lender, the Administrative Agent or the Issuing Bank to be material, then from time to time
the Borrowers shall pay to such Lender, the Administrative Agent or the Issuing Bank, as the case
may be, such additional amount or amounts as will compensate such Lender, the Administrative Agent
or the Issuing Bank or such
Lender’s, the Administrative Agent’s or the Issuing Bank’s holding company for any such
reduction suffered.

     (c)   A certificate of a Lender, the Administrative Agent or the Issuing Bank
setting forth the amount or amounts reasonably determined by such Person to be necessary to
compensate such Lender, the Administrative Agent or the Issuing Bank or its holding company, as
applicable, as specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrowers and shall be conclusive absent manifest error. The Borrowers shall pay such Lender, the
Administrative Agent or the Issuing Bank, 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, the Administrative Agent or the
Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such
Lender’s, the Administrative Agent’s or the Issuing Bank’s right to demand such compensation;
provided that the Borrowers shall not be under any obligation to compensate any Lender, the
Administrative Agent or the Issuing Bank 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 if
such Lender, the Administrative Agent or the Issuing Bank knew or could reasonably have been
expected to know of the circumstances giving rise to such increased costs or reductions and of the
fact that such circumstances would result in a claim for increased compensation by reason of such
increased costs or reductions; 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, the Administrative Agent and the Issuing Bank regardless of any possible contention of the
invalidity or inapplicability of the Change in Law that shall have occurred or been imposed.

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     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 Eurodollar Loan or to give effect to its obligations as contemplated hereby
with respect to any Eurodollar Loan, then, by written notice to the Borrowers and to the
Administrative Agent:

          (i) such Lender may declare that Eurodollar 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 Loans will not thereafter (for such duration) be
converted into Eurodollar 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
Loan (or a request to continue an ABR Loan as such for an additional Interest Period or to
convert a Eurodollar Loan into an ABR Loan, as the case may be), unless such declaration
shall be subsequently withdrawn; and

          (ii) such Lender may require that all outstanding Eurodollar Loans made by it
be converted to ABR Loans, in which event all such Eurodollar Loans shall be
automatically converted to ABR 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 Loans that
would have been made by such Lender or the converted Eurodollar Loans of such Lender shall instead
be applied to repay the ABR Loans made by such Lender in lieu of, or resulting from the conversion
of, such Eurodollar Loans. Any such conversion of a Eurodollar Loan under (i) above shall be
subject to Section 2.16.

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

     SECTION 2.16.   Indemnity. The Borrowers 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 Loan prior to the end of the Interest Period in effect therefor, (ii)
the conversion of any Eurodollar Loan to an ABR Loan, or the conversion of the Interest Period with
respect to any Eurodollar Loan, in each case other than on the last day of the Interest Period in
effect therefor, (iii) any Eurodollar Loan to be made by such Lender (including any Eurodollar Loan
to be made pursuant to a conversion or continuation under Section 2.10) not being made after notice
of such Loan shall have been given by the applicable Borrower hereunder, (iv) the default by the
Term Loan Borrower in making any reduction or conversion of any Credit-Linked Deposits after notice
thereof shall have been given by the Term Loan Borrower hereunder or (v) the reduction or
conversion of any Credit-Linked Deposits on a day which is not the last day of the Interest Period
with respect thereto (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

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required to be made
hereunder. In the case of any Breakage Event, such loss shall include an amount equal to the
excess, as reasonably determined by such Lender, of (i) its cost of obtaining funds for the
Eurodollar Loan or Credit-Linked Deposit 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 Loan or Credit-Linked Deposit, as the case may be, 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 is entitled to receive pursuant to this Section 2.16
shall be delivered to the Borrowers and shall be conclusive absent manifest error.

     SECTION 2.17.   Pro Rata Treatment. Except as provided below in this
Section 2.17 with respect to Swingline Loans and 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 Loans, each payment of the
Commitment Fees, each reduction of the Term Loan Commitments or the Revolving Credit
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 Commitments (or, if such Commitments shall have expired or been terminated, in
accordance with the respective principal amounts of their outstanding Loans). For purposes of
determining the available Revolving Credit Commitments of the Lenders at any time, each outstanding
Swingline Loan shall be deemed to have utilized the Revolving Credit Commitments of the Lenders
(including those Lenders which shall not have made Swingline Loans) pro rata in accordance with
such respective Revolving Credit Commitments. 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 any Borrower or
any other Loan Party, 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 Loan or Loans or L/C
Disbursement as a result of which the unpaid principal portion of its Loans and participations in
L/C Disbursements shall be proportionately less than the unpaid principal portion of the Loans and
participations in L/C Disbursements 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 Loans and L/C Exposure of such other Lender, so that the
aggregate unpaid principal amount of the Loans and L/C Exposure and participations in Loans and L/C
Exposure held by each Lender shall be in the same proportion to the aggregate unpaid principal
amount of all Loans and L/C Exposure then outstanding as the principal amount of its Loans and L/C
Exposure prior to such exercise of banker’s lien, setoff or counterclaim or other event was to the
principal amount of all Loans and L/C Exposure 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

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purchase price or prices or adjustment restored without interest. Each
Borrower expressly consents to the foregoing arrangements and agrees that any Lender holding a
participation in a Loan or L/C Disbursement 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
such Borrower to such Lender by reason thereof as fully as if such Lender had made a Loan directly
to such Borrower in the amount of such participation.

     SECTION 2.19.   Payments . (a) Each Borrower shall make
each payment (including principal of or interest on any Borrowing or any L/C Disbursement 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 (i) Issuing Bank Fees, which shall be paid directly to the Issuing Bank,
and (ii) principal of and interest on Swingline Loans, which shall be paid directly to the
Swingline Lender except as otherwise provided in Section 2.22(e)) 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 Company and the Administrative
Agent). 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 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 any Borrower or any other Loan
Party hereunder or under any other Loan Document shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that if any Borrower or any other Loan
Party shall be required to deduct 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
(including deductions 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 been made, (ii) such Borrower or such other Loan Party shall make
(or cause to be made) such deductions and (iii) such Borrower or such other Loan Party shall pay
(or cause to be paid) the full amount deducted to the relevant Governmental Authority in accordance
with applicable law. In addition, any Borrower or any other Loan Party 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)   Any and all payments by or on account of any obligation of the Administrative
Agent pursuant to Section 2.24(b) hereunder shall be made free and clear of and without deduction
for any Indemnified Taxes or Other Taxes; provided that if the Administrative Agent shall
be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the
Administrative Agent shall so notify the Company and advise it of the additional amount required to
be paid so that the sum payable by the Administrative Agent pursuant to Section

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2.24(b) after
making all required deductions (including deductions applicable to additional sums payable under
this Section) to the Funded L/C Lenders is an amount from the Administrative Agent equal to the sum
they would have received from the Administrative Agent had no deductions been made, (ii) the
Borrowers shall pay such additional amount to the Administrative Agent, (iii) the Administrative
Agent shall make all required deductions, (iv) the Administrative Agent shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable law and (v) the
Borrowers shall jointly and severally indemnify, within 10 days after written demand therefor, the
Administrative Agent with respect to any payments made on account of any obligation of the
Administrative Agent pursuant to Section 2.24(b).

     (c)   Each Borrower shall jointly and severally 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 any Borrower or any Loan Party 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. A certificate as to the amount of such payment or liability shall be
delivered to any 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 Borrowers 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 no Borrower shall 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 certificate as to the amount of an indemnifiable liability within 180 days of such
party’s determination of an indemnifiable event.

     (d)   As soon as practicable after any payment of Indemnified Taxes or Other Taxes
by any Borrower or any other Loan Party to a Governmental Authority, such 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 any Borrower is located, or any treaty
to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver
to such Borrower (with a copy to the Administrative Agent), at the reasonable written request of
such Borrower, such properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without 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 reasonable judgment such completion, execution or delivery would not materially
prejudice the legal position of such Lender.

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     SECTION 2.21.   Assignment of Commitments Under Certain Circumstances; Duty to
Mitigate . (a) In the event (i) any Lender or the Issuing Bank delivers a
certificate requesting compensation pursuant to Section 2.14, (ii) any Lender or the Issuing Bank
delivers a notice described in Section 2.15 or (iii) any Borrower is required to pay any additional
amount to any Lender or the Issuing Bank or any Governmental Authority on account of any Lender or
the Issuing Bank pursuant to Section 2.20, the Borrowers may, at their 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 or the Issuing Bank and the Administrative Agent, require such Lender or
the Issuing Bank 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 Borrowers shall have received the prior written consent of the
Administrative Agent (and, if a Revolving Credit Commitment is being assigned, of the Issuing Bank
and the Swingline Lender), which consent shall not unreasonably be withheld, and (z) the Borrowers
or such assignee shall have paid to the affected Lender or the Issuing Bank 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 Loans or L/C Disbursements of such Lender or the Issuing Bank,
respectively, plus all Fees and other amounts accrued for the account of such Lender or the Issuing
Bank 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 or the Issuing Bank’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 or the Issuing Bank 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 or the Issuing Bank pursuant to paragraph
(b) below), or if such Lender or the Issuing Bank 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 or the Issuing Bank
shall not thereafter be required to make any such transfer and assignment hereunder.

     (b)   If (i) any Lender or the Issuing Bank shall request compensation under Section
2.14, (ii) any Lender or the Issuing Bank delivers a notice described in Section 2.15 or (iii) any
Borrower is required to pay any additional amount to any Lender or the Issuing Bank or any
Governmental Authority on account of any Lender or the Issuing Bank, pursuant to Section 2.20, then
such Lender or the Issuing Bank shall use reasonable efforts (which shall not require such Lender
or the Issuing Bank 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 deemed by it to be significant) (x) to file any certificate or document
reasonably requested in writing by the Borrowers 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 its claims for compensation under Section 2.14 or enable it to
withdraw its notice pursuant to Section 2.15 or would reduce

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amounts payable pursuant to Section
2.20, as the case may be, in the future. Each Borrower hereby agrees to pay all reasonable costs
and expenses incurred by any Lender or the Issuing Bank in connection with any such filing or
assignment, delegation and transfer.

     SECTION 2.22.   Swingline Loans . (a) Swingline
Commitment. Subject to the terms and conditions hereof and relying upon the representations
and warranties set forth herein, the Swingline Lender agrees to make loans to the Revolving Loan
Borrowers, at any time and from time to time after the Restatement Date, and until the earlier of
the Revolving Credit Maturity Date and the termination of the Revolving Credit Commitments in
accordance with the terms hereof, in an aggregate principal amount at any time outstanding that
will not result in (i) the aggregate principal amount of all Swingline Loans exceeding $30,000,000
in the aggregate or (ii) the Aggregate Revolving Credit Exposure, after giving effect to any
Swingline Loan, exceeding the Total Revolving Credit Commitment. Each Swingline Loan shall be in a
principal amount that is an integral multiple of $500,000. The Swingline Commitment may be
terminated or reduced from time to time as provided herein. Within the foregoing limits, the
Revolving Loan Borrowers may borrow, pay or prepay, without premium or penalty, and reborrow
Swingline Loans hereunder, subject to the terms, conditions and limitations set forth herein.

     (b)   Swingline Loans. Each Revolving Loan Borrower shall notify the
Administrative Agent by fax, or by telephone (confirmed by fax), not later than 10:00 a.m., New
York City time, on the day of a proposed Swingline Loan to be made to it. Such notice shall be
delivered on a Business Day, shall be irrevocable and shall refer to this Agreement and shall
specify the requested date (which shall be a Business Day) and amount of such Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any notice received from a
Revolving Loan Borrower pursuant to this paragraph (b). The Swingline Lender shall make each
Swingline Loan available to the applicable Revolving Loan Borrower by means of a credit to the
general deposit account of such Revolving Loan Borrower with the Swingline Lender by 3:00 p.m. on
the date such Swingline Loan is so requested.

     (c)   Prepayment. The Revolving Loan Borrowers shall have the right at any
time and from time to time to prepay any Swingline Loan, in whole or in part, upon giving written
or fax notice (or telephone notice promptly confirmed by written or fax notice) to the Swingline
Lender and to the Administrative Agent before 12:00 (noon), New York City time, on the date of
prepayment at the Swingline Lender’s address for notices specified in the Lender Addendum delivered
by the Swingline Lender. All principal payments of Swingline Loans shall be accompanied by accrued
interest on the principal amount being repaid to the date of payment.

     (d)   Interest. Each Swingline Loan shall be an ABR Loan and, subject to the
provisions of Section 2.07, shall bear interest as provided in Section 2.06(a).

     (e)   Participations. The Swingline Lender may by written notice given to
the Administrative Agent not later than 10:00 a.m., New York City time, on any Business Day require
the Revolving Credit Lenders to acquire participations on such Business Day in all or a portion of
the Swingline Loans outstanding. Such notice shall specify the aggregate amount of Swingline Loans
in which Revolving Credit Lenders will participate. The Administrative Agent will, promptly upon
receipt of such notice, give notice to each Revolving Credit Lender, specifying in such notice such
Lender’s Pro Rata Percentage of such Swingline Loan or Loans.

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In furtherance of the foregoing,
each Revolving Credit Lender hereby absolutely and unconditionally agrees, upon receipt of notice
as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender,
such Revolving Credit Lender’s Pro Rata Percentage of such Swingline Loan or Loans. Each Revolving
Credit Lender acknowledges and
agrees that its obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or an Event of Default, and that each such
payment shall be made without any offset, abatement, withholding or reduction whatsoever. Each
Revolving Credit Lender shall comply with its obligation under this paragraph by wire transfer of
immediately available funds, in the same manner as provided in Section 2.02(c) with respect to
Loans made by such Lender (and Section 2.02(c) shall apply, mutatis mutandis, to the
payment obligations of the Lenders under this Section) and the Administrative Agent shall promptly
pay to the Swingline Lender the amounts so received by it from the Lenders. The Administrative
Agent shall notify the Revolving Loan Borrowers of any participations in any Swingline Loan
acquired pursuant to this paragraph and thereafter payments in respect of such Swingline Loan shall
be made to the Administrative Agent and not to the Swingline Lender. Any amounts received by the
Swingline Lender from the Revolving Loan Borrowers (or other party on behalf of the Revolving Loan
Borrowers) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of
a sale of participations therein shall be promptly remitted to the Administrative Agent; any such
amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent
to the Lenders that shall have made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear. The purchase of participations in a Swingline Loan pursuant
to this paragraph shall not relieve any Revolving Loan Borrower (or other party liable for
obligations of any Revolving Loan Borrower) of any default in the payment thereof.

     SECTION 2.23.   Letters of Credit. (a) General.
On the Restatement Date, the Existing Letters of Credit will automatically, without any action on
the part of any Person, be deemed to be Funded Letters of Credit issued hereunder for the account
of the Term Loan Borrower for all purposes of this Agreement and the other Loan Documents. Subject
to the terms and conditions hereof, (i) each Revolving Loan Borrower may request the issuance of a
Revolving Letter of Credit at any time and from time to time while the Revolving Credit Commitments
remain in effect, and (ii) the Term Loan Borrower may request the issuance of a Funded Letter of
Credit at any time and from time to time during the Funded Letter of Credit Availability Period, in
the case of each of clauses (i) and (ii), for its own account or for the account of any of the
Subsidiary Guarantors or for the account of any other Subsidiary provided that the L/C Exposure
with respect to all such Letters of Credit for the account of Subsidiaries that are not Subsidiary
Guarantors shall not exceed the L/C Exposure Cap (and, if for the account of a Subsidiary Guarantor
or other Subsidiary, such Borrower and such Subsidiary Guarantor or such other Subsidiary, as the
case may be, shall be co-applicants with respect to such Letter of Credit), in a form reasonably
acceptable to the Administrative Agent and the Issuing Bank. This Section shall not be construed
to impose an obligation upon the Issuing Bank to issue any Letter of Credit that is inconsistent
with the terms and conditions of this Agreement.

     (b)   Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.
In order to request the issuance of a Letter of Credit (or to amend, renew or extend an existing
Letter of Credit), the applicable Borrower shall hand deliver or fax to the Issuing Bank and the

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Administrative Agent (no less than three Business Days (or such shorter period of time acceptable
to the Issuing Bank) in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit, or identifying
the Letter of Credit to be amended, renewed or extended, whether such Letter of Credit shall be a
Funded Letter of Credit or a Revolving Letter of Credit, the date of issuance, amendment, renewal
or extension, the date on which such Letter of Credit is to expire (which shall comply with
paragraph (c) below), the amount of such Letter of Credit, the name and address of the beneficiary
thereof and such other information as shall be necessary to prepare such Letter of Credit. The
Issuing Bank shall promptly (i) notify the Administrative Agent in writing of the amount and expiry
date of each Letter of Credit issued by it and (ii) provide a copy of such Letter of Credit (and
any amendments, renewals or extensions thereof) to the Administrative Agent. A Funded Letter of
Credit shall be issued, amended, renewed or extended only if, and upon issuance, amendment, renewal
or extension of each such Funded Letter of Credit the Term Loan Borrower shall be deemed to
represent and warrant that, after giving effect to such issuance, amendment, renewal or extension
the Funded L/C Exposure shall not exceed the Total Credit-Linked Deposit at such time. A Revolving
Letter of Credit shall be issued, amended, renewed or extended only if, and upon issuance,
amendment, renewal or extension of each such Revolving Letter of Credit the applicable Revolving
Loan Borrower shall be deemed to represent and warrant that, after giving effect to such issuance,
amendment, renewal or extension, the Aggregate Revolving Credit Exposure shall not exceed the Total
Revolving Credit Commitment. If the applicable Borrower shall fail to specify whether any
requested Letter of Credit is to be a Funded Letter of Credit or a Revolving Letter of Credit, then
the requested Letter of Credit shall be deemed to be a Funded Letter of Credit unless the issuance
thereof would result in the Funded L/C Exposure exceeding the Total Credit-Linked Deposit at such
time, in which case it shall be deemed to be a Revolving Letter of Credit, but only if the issuance
of a Revolving Letter of Credit is permissible at such time as described above. Notwithstanding
the foregoing, the issuance of Funded Letters of Credit shall also be subject to the limitations
set forth in Section 2.23(e) below.

     (c)   Expiration Date. Each Letter of Credit shall expire at the close of
business on the earlier of (i) the date one year after the date of the issuance of such Letter of
Credit and (ii)(A) in the case of any Revolving Letter of Credit, the date that is five Business
Days prior to the Revolving Credit Maturity Date and (B) in the case of any Funded Letter of
Credit, the date that is five Business Days prior to the Funded Letter of Credit Maturity Date,
unless such Letter of Credit expires by its terms on an earlier date; provided,
however, that a Letter of Credit may, upon the request of the applicable Borrower, include
a provision whereby such Letter of Credit shall be renewed automatically for additional consecutive
periods of 12 months or less (but not beyond the date that is five Business Days prior to, in the
case of any Revolving Letter of Credit, the Revolving Credit Maturity Date or, in the case of any
Funded Letter of Credit, the Funded Letter of Credit Maturity Date) unless the Issuing Bank
notifies the beneficiary thereof at least 30 days prior to the then-applicable expiration date that
such Letter of Credit will not be renewed.

     (d)   Participations. By the issuance of a Revolving Letter of Credit and
without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby
grants to each Revolving Credit Lender, and each such Lender hereby acquires from the Issuing Bank,
a participation in such Letter of Credit equal to such Lender’s Pro Rata Percentage of the

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aggregate amount available to be drawn under such Letter of Credit, effective upon the issuance of
such Letter of Credit. In consideration and in furtherance of the foregoing, each Revolving
Credit Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the Issuing Bank, such Lender’s Pro Rata Percentage of each Revolving L/C
Disbursement made by the Issuing Bank and not reimbursed by any Borrower (or, if applicable,
another party pursuant to its obligations under any other Loan Document) forthwith on the date due
as provided in Section 2.02(f). Each Revolving Credit Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of Revolving Letters of
Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or an Event of Default, and that each such
payment shall be made without any offset, abatement, withholding or reduction whatsoever.

     On the Restatement Date, without any further action on the part of the Issuing Bank or the
Lenders, the Issuing Bank hereby grants to each Funded L/C Lender, and each such Lender hereby
acquires from the Issuing Bank, a participation in each Funded Letter of Credit (including each
Existing Letter of Credit) equal to such Lender’s Pro Rata Percentage of the aggregate amount
available to be drawn under such Letter of Credit. The aggregate purchase price for the
participations of each Funded L/C Lender in Funded Letters of Credit shall equal the amount of the
Credit-Linked Deposit of such Lender. Each Funded L/C Lender shall pay to the Administrative Agent
its Credit-Linked Deposit in full on the Restatement Date. Each Funded L/C Lender hereby
absolutely and unconditionally agrees that if the Issuing Bank makes a Funded L/C Disbursement
which is not reimbursed by the Term Loan Borrower pursuant to Section 2.23(e), the Administrative
Agent shall reimburse the Issuing Bank for the amount of such Funded L/C Disbursement, ratably as
among the Funded L/C Lenders in accordance with their Pro Rata Percentages of the Total
Credit-Linked Deposit, from such Funded L/C Lender’s Credit-Linked Deposit on deposit in the
Credit-Linked Deposit Account. Each Funded L/C Lender acknowledges and agrees that its obligation
to acquire and fund participations in respect of Funded Letters of Credit pursuant to this
paragraph is unconditional and irrevocable and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or an Event of Default or the
return of the Credit-Linked Deposits, and that such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Without limiting the foregoing, each Funded L/C
Lender irrevocably authorizes the Administrative Agent to apply amounts of its Credit-Linked
Deposit as provided in this paragraph.

     (e)   Reimbursement. If the Issuing Bank shall make any Revolving L/C
Disbursement in respect of a Revolving Letter of Credit, the applicable Revolving Loan Borrower
shall pay or cause to be paid to the Administrative Agent an amount equal to such Revolving L/C
Disbursement not later than two hours after such Revolving Loan Borrower shall have received notice
from the Issuing Bank that payment of such draft will be made, or, if such Revolving Loan Borrower
shall have received such notice later than 10:00 a.m., New York City time, on any Business Day, not
later than 12:00 (noon), New York City time, on the immediately following Business Day.

     If the Issuing Bank shall make any Funded L/C Disbursement in respect of a Funded Letter of
Credit, the Term Loan Borrower shall have the right (but not the obligation) to pay or

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cause to be
paid to the Administrative Agent an amount equal to the entire amount of such Funded L/C
Disbursement not later than two hours after the Term Loan Borrower shall have
received notice from the Issuing Bank that payment of such draft will be made or, if the Term
Loan Borrower shall have received such notice later than 10:00 a.m., New York City time, on any
Business Day, not later than 12:00 (noon), New York City time, on the immediately following
Business Day. If the Term Loan Borrower does not so elect to reimburse the Issuing Bank for such
Funded L/C Disbursement, reimbursement of the Issuing Bank shall be made in accordance with the
provisions of Section 2.02(f). In the event that the Term Loan Borrower elects to reimburse the
Issuing Bank for any Funded L/C Disbursement, for a period of 91 days following such reimbursement
payment by the Term Loan Borrower, the Funded L/C Exposure shall be deemed to include for all
purposes hereunder (including for purposes of the issuance of any new Funded Letter of Credit
during such period) the amount of such reimbursement payment until the end of such 91-day period.

     (f)   Obligations Absolute. Each Borrower’s obligations to reimburse L/C
Disbursements as provided in paragraph (e) above shall be absolute, unconditional and irrevocable,
and shall be performed strictly in accordance with the terms of this Agreement, under any and all
circumstances whatsoever, and irrespective of:

          (i) any lack of validity or enforceability of any Letter of Credit or any
Loan Document, or any term or provision therein;

          (ii) any amendment or waiver of, or any consent to departure from, all or any
of the provisions of any Letter of Credit or any Loan Document;

          (iii) the existence of any claim, setoff, defense or other right that the
applicable Borrower, any other party guaranteeing, or otherwise obligated with, such
Borrower, any subsidiary or other Affiliate thereof or any other Person may at any time have
against the beneficiary under any Letter of Credit, the Issuing Bank, the Administrative
Agent or any Lender or any other Person, whether in connection with this Agreement, any
other Loan Document or any other related or unrelated agreement or transaction;

          (iv) any draft or other document presented under a Letter of Credit proving
to be forged, fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect;

          (v) payment by the Issuing Bank under a Letter of Credit against presentation
of a draft or other document that does not comply with the terms of such Letter of Credit;
and

          (vi) any other act or omission to act or delay of any kind of the Issuing
Bank, any Lender, the Administrative Agent or any other Person or any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of the applicable
Borrower’s obligations hereunder.

     Without limiting the generality of the foregoing, it is expressly understood and agreed that
the absolute and unconditional obligation of each Borrower hereunder to reimburse L/C

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Disbursements
will not be excused by the gross negligence or willful misconduct of the Issuing Bank. However,
the foregoing shall not be construed to excuse the Issuing Bank from liability to
any Borrower to the extent of any direct damages (as opposed to consequential damages, claims
in respect of which are hereby waived by each Borrower to the extent permitted by applicable law)
suffered by such Borrower that are caused by the Issuing Bank’s gross negligence or willful
misconduct in determining whether drafts and other documents presented under a Letter of Credit
comply with the terms thereof; it is understood that the Issuing Bank may accept documents that
appear on their face to be in order, without responsibility for further investigation, regardless
of any notice or information to the contrary and, in making any payment under any Letter of Credit
(i) the Issuing Bank’s exclusive reliance on the documents presented to it under such Letter of
Credit as to any and all matters set forth therein, including reliance on the amount of any draft
presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder
equals the amount of such draft and whether or not any document presented pursuant to such Letter
of Credit proves to be insufficient in any respect, if such document on its face appears to be in
order, and whether or not any other statement or any other document presented pursuant to such
Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or
untrue in any respect whatsoever and (ii) any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall, in each case, be
deemed not to constitute willful misconduct or gross negligence of the Issuing Bank.

     (g)   Disbursement Procedures. The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for payment under a
Letter of Credit. The Issuing Bank shall as promptly as possible give telephonic notification,
confirmed by fax, to the Administrative Agent and the applicable Borrower of such demand for
payment and whether the Issuing Bank has made or will make an L/C Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not relieve the
applicable Borrower of its obligation to reimburse the Issuing Bank and the applicable Lenders with
respect to any such L/C Disbursement. The Administrative Agent shall promptly give each Revolving
Credit Lender or each Funded L/C Lender, as the case may be, notice thereof.

     (h)   Interim Interest. If the Issuing Bank shall make any L/C Disbursement
in respect of a Letter of Credit, then, (i) in the case of any Revolving L/C Disbursement, unless
the applicable Borrower shall reimburse such Revolving L/C Disbursement in full on such date or
(ii) in the case of any Funded L/C Disbursement, unless either the Term Loan Borrower shall
reimburse such Funded L/C Disbursement in full within the time period specified in Section 2.23(e)
or the Administrative Agent shall reimburse such Funded L/C Disbursement with funds held in the
Credit-Linked Deposit Account in full on such date, in each case the unpaid amount thereof shall
bear interest for the account of the Issuing Bank, for each day from and including the date of such
L/C Disbursement to but excluding the earlier of the date of payment by the applicable Borrower or
the date on which interest shall commence to accrue thereon as provided in Section 2.02(f), at (A)
in the case of a Revolving L/C Disbursement, the rate per annum that would apply to such amount if
such amount were an ABR Revolving Loan and (B) in the case of a Funded L/C Disbursement, the rate
per annum that would apply to such amount if such amount were an ABR Term Loan.

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     (i)   Resignation or Removal of the Issuing Bank. The Issuing Bank may
resign at any time by giving 30 days’ prior written notice to the Administrative Agent, the Lenders
and the Borrowers, and may be removed at any time by the Company by notice to the Issuing Bank, the
Administrative Agent and the Lenders. Subject to the next succeeding paragraph, upon the
acceptance of any appointment as the Issuing Bank hereunder by a Lender that shall agree to serve
as successor Issuing Bank, such successor shall succeed to and become vested with all the
interests, rights and obligations of the retiring Issuing Bank and the retiring Issuing Bank shall
be discharged from its obligations to issue additional Letters of Credit hereunder without
affecting its rights and obligations with respect to Letters of Credit previously issued by it. At
the time such removal or resignation shall become effective, the Borrowers shall pay all accrued
and unpaid fees pursuant to Section 2.05(c)(ii). The acceptance of any appointment as the Issuing
Bank hereunder by a successor Lender shall be evidenced by an agreement entered into by such
successor, in a form satisfactory to the Borrowers and the Administrative Agent, and, from and
after the effective date of such agreement, (i) such successor Lender shall have all the rights and
obligations of the previous Issuing Bank under this Agreement and the other Loan Documents and (ii)
references herein and in the other Loan Documents to the term “Issuing Bank” shall be deemed to
refer to such successor or to any previous Issuing Bank, or to such successor and all previous
Issuing Banks, as the context shall require. After the resignation or removal of the Issuing Bank
hereunder, the retiring Issuing Bank shall remain a party hereto and shall continue to have all the
rights and obligations of an Issuing Bank under this Agreement and the other Loan Documents with
respect to Letters of Credit issued by it prior to such resignation or removal, but shall not be
required to issue additional Letters of Credit.

     (j)   Cash Collateralization. If any Event of Default shall occur and be
continuing, the Borrowers shall, on the Business Day they receive notice from the Administrative
Agent or the Majority Lenders (or, if the maturity of the Loans has been accelerated, Revolving
Credit Lenders and Funded L/C Lenders with L/C Exposure representing greater than 50% of the total
L/C Exposure) thereof and of the amount to be deposited, deposit in an account with the Collateral
Agent, for the ratable benefit of the Lenders with L/C Exposure, an amount in cash equal to the L/C
Exposure as of such date. Such deposit shall be held by the Collateral Agent as collateral for the
payment and performance of the obligations of the Borrowers under this Agreement. The Collateral
Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over
such account. Other than any interest earned on the investment of such deposits in Cash
Equivalents, which investments shall be made at the option and sole discretion of the Collateral
Agent, such deposits shall not bear interest. Interest or profits, if any, on such investments
shall accumulate in such account. Moneys in such account shall (i) automatically be applied by the
Administrative Agent to reimburse the Issuing Bank for L/C Disbursements for which it has not been
reimbursed, (ii) be held for the satisfaction of the reimbursement obligations of the Borrowers for
the L/C Exposure at such time and (iii) if the maturity of the Loans has been accelerated (but
subject to the consent of Revolving Credit Lenders and Funded L/C Lenders with L/C Exposure
representing greater than 50% of the total L/C Exposure), be applied to satisfy the Secured
Obligations hereunder. If the Borrowers are required to provide an amount of cash collateral
hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not
applied as aforesaid) shall be returned to the Borrowers within three Business Days after all
Events of Default have been cured or waived.

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     (k)   Additional Issuing Banks. The Borrowers may, at any time and from
time to time with the consent of the Administrative Agent (which consent shall not be unreasonably
withheld) and such Lender, designate one or more additional Lenders to act as an issuing bank under
the terms of the Agreement. Any Lender designated as an issuing bank pursuant to this paragraph
shall be deemed to be an “Issuing Bank” (in addition to being a Lender) in respect of Letters
of Credit issued or to be issued by such Lender, and, with respect to such Letters of Credit, such
term shall thereafter apply to the other Issuing Bank and such Lender.

     SECTION 2.24.   Credit-Linked Deposit Account . (a) The
Credit-Linked Deposits shall be held by the Administrative Agent in the Credit-Linked Deposit
Account, and no party other than the Administrative Agent shall have a right of withdrawal from the
Credit-Linked Deposit Account or any other right or power with respect to the Credit-Linked
Deposits, except as expressly set forth in Section 2.02(f), 2.09(b) or 2.09(d). Notwithstanding
any provision in this Agreement to the contrary, the sole funding obligation of each Funded L/C
Lender in respect of its participation in Funded Letters of Credit shall be satisfied in full upon
the funding of its Credit-Linked Deposit on the Restatement Date.

     (b)   Each of the Borrowers, the Administrative Agent, the Issuing Bank and each
Funded L/C Lender hereby acknowledges and agrees that each Funded L/C Lender is funding its
Credit-Linked Deposit to the Administrative Agent for application in the manner contemplated by
Section 2.02(f) and that the Administrative Agent has agreed to invest the Credit-Linked Deposits
so as to earn a return (subject to Section 2.08) for the Funded L/C Lenders equal to (i) the LIBO
Rate (without giving effect to the last proviso in the definition thereof) for the Interest Period
in effect for the Credit-Linked Deposits at such time (the “Benchmark LIBO Rate”)
minus (ii) 0.10%. Such interest will be paid to the Funded L/C Lenders by the
Administrative Agent quarterly in arrears when Letter of Credit fees are payable pursuant to
Section 2.05(d). In addition to the foregoing payments by the Administrative Agent, the Borrowers
agree to make payments to the Funded L/C Lenders quarterly in arrears when Letter of Credit fees
are payable pursuant to Section 2.05(d) (and together with the payment of such fees) in an amount
equal to 0.10% on the average daily amount of the Credit-Linked Deposit during the applicable
Interest Period.

     (c)   Subject to Section 2.09(d), the Borrowers shall have no right, title or
interest in or to the Credit-Linked Deposits and no obligations with respect thereto, it being
acknowledged and agreed by the parties hereto that the making of the Credit-Linked Deposits by the
Funded L/C Lenders, the provisions of this Section 2.24 and the application of the Credit-Linked
Deposits in the manner contemplated by Section 2.02(f) constitute agreements among the
Administrative Agent, the Issuing Bank and each Funded L/C Lender with respect to the funding
obligations of each Funded L/C Lender in respect of its participation in Funded Letters of Credit
and do not constitute any loan or extension of credit to the Borrowers, subject to the provisions
of Section 2.02(f).

     (d)   Subject to the Borrowers’ compliance with the cash-collateralization
requirements set forth in Section 2.09, the Administrative Agent shall return any remaining
Credit-Linked Deposits to the Funded L/C Lenders following the occurrence of the Funded Letter of
Credit Maturity Date.

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ARTICLE III.

Representations and Warranties

     Each Borrower jointly and severally represents and warrants to the Arrangers, the
Administrative Agent, the Collateral Agent, the Issuing Bank and each of the Lenders that:

     SECTION 3.01.   Organization; Powers. The Company and each of the
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 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
Borrowers, to borrow hereunder, in the case of each Loan Party, to grant the Liens contemplated to
be granted by it under the Security Documents and, in the case of each Subsidiary Guarantor, to
Guarantee the Secured Obligations hereunder as contemplated by the Guarantee and Collateral
Agreement.

     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 and (b) will not (i) violate (A) any provision of
law, statute, rule or regulation, or of the certificate or articles of incorporation or other
constitutive documents or by-laws of the Company or any Subsidiary, (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 Company or any Subsidiary 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 Company or any other Loan Party (other than Liens created under
the Security Documents).

     SECTION 3.03.   Enforceability. This Agreement has been duly executed and
delivered by each Borrower and constitutes, and each other Loan Document when executed and
delivered by each Loan Party party thereto will constitute, a legal, valid and binding obligation
of such Loan Party enforceable against such Loan Party in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’
rights generally and
subject to general principles of equity, regardless of whether considered in a proceeding in
equity or at law.

     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

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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 and (c) such as have been made or obtained and
are in full force and effect.

     SECTION 3.05.   Financial Statements . (a) The Company has,
on or prior to the Restatement Date, furnished to the Lenders its consolidated balance sheets and
statements of income and stockholder’s equity (i) as of and for the fiscal years ended December 31,
2003, December 31, 2002 and December 31, 2001, audited by and accompanied by the opinion of
PricewaterhouseCoopers LLP, independent public accountants, and (ii) as of and for the fiscal
quarter and the portion of the fiscal year ended September 30, 2004, certified by a Financial
Officer of the Company and reviewed by KPMG LLP, independent public accountants, as provided in
Statement on Auditing Standards No. 100. 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, subject to normal year-end audit adjustments
and the absence of footnotes in the case of the financial statements referred to in clause (ii)
above. 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 (except,
with respect to such financial statements referred to in clause (ii) above, for the absence of
footnotes and normal year-end adjustments).

     (b)   The Company has heretofore delivered to the Lenders its unaudited pro forma
consolidated balance sheet and statements of income, stockholder’s equity and cash flows as of
September 30, 2004, prepared giving effect to the Transactions as if they had occurred, with
respect to such balance sheet, on such date and, with respect to such other financial statements,
on the first day of each of the 9-month period and 12-month period ending on such date. Such pro
forma financial statements (i) have been prepared in good faith by the Company, based on the
assumptions used to prepare the pro forma financial information contained in the Confidential
Information Memorandum (which assumptions are believed by the Company on the Restatement Date to be
reasonable) and (ii) present fairly in all material respects on a pro forma basis the estimated
consolidated financial position of the Company and its consolidated Subsidiaries as of such date
and for such period, assuming that the Transactions had actually occurred at such date or at the
beginning of such period, as the case may be (it being understood that estimates, by their nature,
are inherently uncertain and that no assurances are being made that such results will be achieved).

     SECTION 3.06.   No Material Adverse Change. No event, change or condition has occurred that has had, or could reasonably be expected to
have, a Material Adverse Effect, since December 31, 2003.

     SECTION 3.07.   Title to Properties; Possession Under Leases . (a) Each of the Company and the other Loan Parties has good and marketable title to, or
valid leasehold interests in, all its material properties and material assets that are included in
the Collateral (including all Mortgaged Property) and including valid rights, title and interests
in or rights to control or occupy easements or rights of way used in connection with such
properties and assets (“Easements”), free and clear of all Liens or other exceptions to
title other than Permitted Liens.

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     (b)   Each of the Company and the Subsidiaries has complied with all material
obligations under all material leases to which it is a party and all such material leases are in
full force and effect. Each of the Company and the Subsidiaries enjoys peaceful and undisturbed
possession under all such material leases.

     (c)   None of the Company or any of the other Loan Parties has received any notice
of, nor has any knowledge of, any pending or contemplated condemnation proceeding affecting the
Mortgaged Properties or any sale or disposition thereof in lieu of condemnation (i) as of the
Restatement Date or (ii) at any time thereafter, which in the case of clause (ii) has had, or could
reasonably be expected to have, a Material Adverse Effect.

     (d)   Except as set forth on Schedule 3.07, none of the Company or any of the
Subsidiaries is obligated under any right of first refusal, option or other contractual right to
sell, assign or otherwise dispose of any Mortgaged Property or any interest therein.

     SECTION 3.08.   Subsidiaries. Schedule 3.08 sets forth as of the
Restatement 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 Company (direct or indirect) therein, and identifies each Subsidiary that is a Loan Party. The
shares of capital stock or other Equity Interests so indicated on Schedule 3.08 are owned by the
Company, 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), Liens
expressly permitted hereunder) and all such shares of capital stock are fully paid and
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
any Borrower, threatened against the Company or any Subsidiary or any business, property or rights
of the Company or any Subsidiary (i) that involve any Loan Document or the Transactions 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 a Material
Adverse Effect.

     (b)   Except as set forth on Schedule 3.09, none of the Company or any of the
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, but not including any Environmental Law which is the subject of Section 3.17) or any
restrictions of record or agreements affecting the Mortgaged Property, 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 a Material Adverse Effect.

     (c)   Certificates of occupancy and permits are in effect for each Mortgaged
Property as currently constructed.

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     SECTION 3.10.   Agreements . (a) None of the Company or any
of the Subsidiaries is a party to any agreement or instrument, or subject to any corporate
restriction, that, individually or in the aggregate, has resulted or could reasonably be expected
to result in a Material Adverse Effect.

     (b)   None of the Company or any of the Subsidiaries is in default in any manner
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 Company or any of the Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.

     (b)   No part of the proceeds of any Loan or any Letter of Credit 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 any 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 Loans or Letters of Credit was or will be incurred for the purpose of
purchasing or carrying any Margin Stock. Following the application of the proceeds of the Loans
and the Letters of Credit, Margin Stock will not constitute more than 25% of the value of the
assets of the Company 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,
each 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. None of the Company or any of the Subsidiaries is an “investment company” as defined in, or
subject to regulation under, the Investment Company Act of 1940, as amended from time to time.

     SECTION 3.13.   Use of Proceeds. The Borrowers will use the proceeds of the
Term Loans and Revolving Loans made on the Restatement Date solely in connection with the
assignment of the Term Loans, Credit-Linked Deposits, Revolving Loans and Revolving Credit
Commitments existing on the Restatement Date, and to re-evidence and/or to pay amounts outstanding
under the Original Credit Agreement and fees and expenses incurred in connection therewith. The
Revolving Loan Borrowers will use the proceeds of the Revolving Loans and the Swingline Loans made
after the Restatement Date solely for the working capital requirements and general corporate
purposes of the Company and the Subsidiary Guarantors. The Revolving Loan Borrowers and the Term
Loan Borrower, as the case may be, will request the issuance of Letters of Credit solely for the
working capital requirements and general corporate purposes of (i) the Company and the Subsidiary
Guarantors or (ii) any other Subsidiary, provided that the L/C Exposure with respect thereto shall
not exceed the L/C Exposure Cap. The Term Loan Borrower will use the proceeds of the Term Loans
that may be made, or deemed to be made,

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from the requested conversion of Credit-Linked Deposits
into Term Loans solely for the working capital requirements and general corporate purposes of the
Company and the Subsidiary Guarantors.

     SECTION 3.14.   Tax Returns. Each of the Company and each of the
Subsidiaries has filed or caused to be filed all 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. Each of the Company and each of the Subsidiaries has paid or caused to be
paid all 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 Company or such
Subsidiary, as applicable, shall have set aside on its books adequate reserves. 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 Company and each of the Subsidiaries, no
claim is being asserted, with respect to any Tax. Neither the Company nor any of the Subsidiaries
(a) intends to treat the 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. The Borrowers
have disclosed to the Arrangers, the Administrative Agent and the Lenders all agreements,
instruments and corporate or other restrictions to which the Company or any of the Subsidiaries is
subject, and all other matters known to any of them, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. None of (i) the Confidential
Information Memorandum or (ii) any other information, report, financial statement, exhibit or
schedule furnished by or on behalf of the Company or any Subsidiary 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 Restatement 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 information, report, financial statement, exhibit or
schedule was based upon or constitutes a forecast or projection, each Borrower represents only that
it acted in good faith and utilized reasonable assumptions and due care in the preparation of such
information, report, financial statement, exhibit or schedule.

     SECTION 3.16.   Employee Benefit Plans. Each of the Company and each of its
ERISA Affiliates is in compliance in all material respects 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 material liability of the Company or any of its ERISA Affiliates.

     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 a Material Adverse Effect, none of the
Company or any of the Subsidiaries:

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          (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 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 may result in the
termination, revocation or modification of any permit, license or other approval required
under Environmental Law;

          (iii) has become subject to any Environmental Liability or possesses
knowledge that any Mortgaged Property (A) is subject to any Lien imposed pursuant to
Environmental Law or (B) contains Hazardous Materials of a form 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 are reasonably
likely to result in any Environmental Liability or could materially interfere with or
prevent continued material compliance with Environmental Laws in effect as of the
Restatement Date and the date of each Credit Event by the Company or the Subsidiaries.

     (b)   Since the Restatement 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
materially increased the likelihood of, a Material Adverse Effect.

     The representations and warranties in this Section 3.17 are the sole representations and
warranties herein with respect to Environmental Law.

     SECTION 3.18.   Insurance. Schedule 3.18 sets forth a true, complete and
correct description of all insurance maintained by or on behalf of the Company and the Subsidiaries
as of the Restatement Date. As of the Restatement Date, such insurance is in full force and effect
and all premiums that are due and owed have been duly paid. The Company and the Subsidiaries are
insured by financially sound and responsible 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. None of the
Company or any of the Subsidiaries (a) has received notice from any insurer under any such
insurance (or any agent thereof) that substantial capital improvements or other substantial
expenditures will have to be made in order to continue such insurance (i) as of the Restatement
Date or (ii) at any time thereafter, which in the case of clause (ii) has had, or could reasonably
be expected to have, a Material Adverse Effect or (b) has any reason to believe that it will not be
able to renew its existing coverage as and when such coverage expires or to obtain similar coverage
from similar insurers at a substantially similar cost as available to companies of a similar size
operating in the same or similar businesses.

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     SECTION
3.19.   Security Documents. (a) The Guarantee and
Collateral Agreement is effective to create in favor of the Collateral Trustee, for the ratable
benefit of the Secured Parties, a legal, valid, binding and enforceable security interest in the
Collateral described therein and proceeds thereof and (i) in the case of the Pledged Securities,
upon the earlier of (A) when such Pledged Securities are delivered to the Collateral Trustee and
(B) when financing statements in appropriate form are filed in the offices specified on Schedule
3.19(a) and (ii) in the case of all other Collateral described therein (other than Intellectual
Property Collateral), when financing statements in appropriate form are filed in the offices
specified on Schedule 3.19(a), the Guarantee and Collateral Agreement shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of the Secured Parties
in such Collateral and proceeds thereof, as security for the Secured 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 Liens expressly permitted by Section 6.02).

     (b)   Each Intellectual Property Security Agreement is effective to create in favor
of the Collateral Trustee, 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. When each Intellectual Property Security Agreement 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),
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 and proceeds thereof, as security for the Secured Obligations hereunder, in
each case prior and superior in right to any other Person (except with respect to Liens expressly
permitted by Section 6.02) (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 and copyrights acquired by the grantors after
the Restatement Date).

     (c)   Each of the Mortgages is effective to create in favor of the Collateral
Trustee, for the ratable benefit of the Secured Parties, a legal, valid, binding, subsisting and
enforceable Lien on, and security interest in, all of the Loan Parties’ right, title and interest
in and to the Mortgaged Property thereunder and proceeds thereof, and when the Mortgages are filed
in the offices specified on Schedule 3.19(c), 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 Secured 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), (p) or
(q)), (n), (p) or (q) of the definition of “Permitted Liens”).

     SECTION 3.20.   Location of Real Property. Schedule 3.20 lists completely
and correctly as of the Restatement Date all real property owned or leased by the Company and the
other Loan Parties and all real property to which the Company and the
other Loan Parties have an interest via easement, license or permit and, in each case, the addresses thereof, indicating for
each parcel whether it is owned or leased. As of the Restatement Date, the Company and the other

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Loan Parties own in fee or have valid leasehold or easement interests in, as the case may be, all
the real property set forth on Schedule 3.20.

     SECTION 3.21.   Labor Matters. As of the Restatement Date, there are no
strikes, lockouts or slowdowns against the Company or any Subsidiary pending or, to the knowledge
of any Borrower, threatened. The hours worked by and payments made to employees of the Company and
the Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters. All payments due from the Company
or any Subsidiary, or for which any claim may be made against the Company or any Subsidiary, 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 Company or such Subsidiary. 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 Company or any Subsidiary is
bound.

     SECTION 3.22.   Intellectual Property. Each of the Company and each of the
Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the Company and the
Subsidiaries does not infringe upon the rights of any other Person, except for any such
infringements that, individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.

     SECTION 3.23.   Energy Regulation. (a) Neither the Company
nor any “subsidiary company” of the Company is, or by virtue of the Transactions, will become,
subject to regulation as (i) a “holding company” or a “public utility company” or, to the best of
the knowledge of the Company after due inquiry, (ii) a “subsidiary company” of a “holding
company,” in each case as such terms are defined in PUHCA. To the best of the knowledge of the
Company after due inquiry, as of the Restatement Date, none of the Company or any “subsidiary
company” of the Company shall be a “subsidiary company” of a “holding company,” in each case as
such terms are defined in PUHCA.

     (b) None of the Company or any of the Subsidiaries is subject to regulation as a “public
utility” as such term is defined in the FPA, other than entities that have market-based rate
authority under Section 205 of the FPA. Each Subsidiary that is subject to regulation as a “public
utility” as such term is defined in the FPA has validly issued orders from the FERC that, to the
best of the knowledge of the Company after due inquiry, are not subject to any pending challenge,
investigation or proceeding (other than the FERC’s generic proceeding initiated in Docket No.
EL01-118-000) (x) authorizing such Subsidiary 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 assume liabilities pursuant to Section 204 of the FPA. Devon Power LLC, Middleton Power LLC and
Montville Power LLC also have “reliability must run” agreements with ISO New England, which impose
certain limitations on these companies in exchange for a guarantee of fixed cost recovery. The FERC
has issued an order stating that it grants to the Company authority to issue certain securities
under Section 204 of the FPA, but it has not issued an order stating that it grants to the Company
blanket authorizations to issue securities and

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assume liabilities pursuant to Section 204 of the
FPA. With respect to each Person described in the preceding sentence, FERC has not imposed any
rate caps or mitigation measures other than 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 Person conducts its
business.

     (c) None of the Company or any of the Subsidiaries is subject to any state laws or regulations
respecting rates or the financial or organizational regulation of utilities, other than, with
respect to those Subsidiaries that are QF’s, such state regulations contemplated by 18 C.F.R.
Section 292.602(c), “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 the assertion of jurisdiction by the State of California over maintenance and
operating standards of all generating facilities pursuant to SB 39XX.

     SECTION 3.24.   Solvency. Immediately after the consummation of the
Transactions to occur on the Restatement Date and immediately following the making of each Loan (or
other extension of credit hereunder) and after giving effect to the application of the proceeds of
each Loan (or other extension of credit hereunder), (a) the fair value of the assets of each Loan
Party, at a fair valuation, will exceed its debts and liabilities, subordinated, contingent or
otherwise; (b) the present fair saleable value of the property of each Loan Party will be greater
than the amount that will be required to pay the probable liability of its debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become
absolute and matured; (c) each Loan Party will be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured;
and (d) no Loan Party will have unreasonably small capital with which to conduct the business in
which it is engaged as such business is now conducted and is proposed to be conducted following the
Restatement Date.

ARTICLE IV.

Conditions of Lending

     Without affecting the rights of any Loan Party hereunder at all times prior to the Restatement
Date, the amendment and restatement of the Original Credit Agreement in the form hereof and the
obligations of the Lenders to make Loans, the obligations of the Issuing Bank to issue Letters of
Credit and the obligations of the Funded L/C Lenders to fund their Credit-Linked Deposits hereunder
are subject to the satisfaction (or waiver in accordance with Section 9.08) of the following
conditions:

     SECTION 4.01.   All Credit Events. On the date of each Borrowing on or
after the Restatement Date, including each Borrowing of a Swingline Loan, and on the date of each
issuance, amendment, extension or renewal of a Letter of Credit on or after the Restatement Date
(each such event being called a “Credit Event”):

     (a)   The Administrative Agent shall have received a notice of such Borrowing
as required by Section 2.03 (or such notice shall have been deemed given in accordance with
Section 2.03) or, in the case of the issuance, amendment, extension or renewal of a

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Letter
of Credit, the Issuing Bank and the Administrative Agent shall have received a notice
requesting the issuance, amendment, extension or renewal of such Letter of Credit as
required by Section 2.23(b) or, in the case of the Borrowing of a Swingline Loan, the
Swingline Lender and the Administrative Agent shall have received a notice requesting such
Swingline Loan as required by Section 2.22(b).

     (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 date of such Credit
Event 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)   Each Borrower and each other Loan Party shall be in compliance with all
the terms and provisions set forth in each Loan Document on its part to be observed or
performed, and, at the time of and immediately after such Credit Event, no Event of Default
or Default shall have occurred and be continuing.

     (d)   After giving effect to such Credit Event, the Aggregate Revolving
Credit Exposure shall not exceed the Total Revolving Credit Commitment.

     Each Credit Event shall be deemed to constitute a joint and several representation and
warranty by the Borrowers on the date of such Credit Event as to the matters specified in
paragraphs (b), (c) and (d) of this Section 4.01.

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

     (a)   The Administrative Agent shall have received, on behalf of itself, the
Lenders and the Issuing Bank, a favorable written opinion of (i) Skadden, Arps, Slate,
Meagher & Flom LLP, counsel for the Borrowers and the Subsidiaries, substantially to the
effect set forth in Exhibit N, and (ii) each special and local counsel to the Borrowers and
the Subsidiaries (including special regulatory counsel) as the Arrangers may reasonably
request, in each case (A) dated the Restatement Date, (B) addressed to the Administrative
Agent, the Issuing Bank 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, and the Borrowers and the
Subsidiaries hereby request such counsel to deliver such opinions.

     (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 each Loan Party, 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 of each
Loan Party as of a recent date, from such Secretary of State; (ii) a certificate of the
Secretary or Assistant Secretary of each Loan Party dated the Restatement Date and
certifying (A) that attached thereto is a true and complete copy of the by-laws of such Loan
Party as in effect on the Restatement Date and at all times since a date prior to the date
of the resolutions described in clause (B) below, (B) that attached thereto is a true and
complete copy of

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resolutions duly adopted by the Board of Directors of such Loan Party
authorizing the execution, delivery and performance of the Loan Documents to which such
Person is a party, and in the case of the Borrowers, 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 such
Loan Party have 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) 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 such Loan Party; (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) such other
documents as the Administrative Agent, the Arrangers, the Issuing Bank or the Lenders may
reasonably request (including, 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 Patriot Act).

     (c)   The Administrative Agent shall have received a certificate, dated the
Restatement Date and signed by a Financial Officer of the Company, confirming compliance
with the conditions precedent set forth in paragraphs (b), (c) and (d) of Section 4.01.

     (d)   The Administrative Agent shall have received (i) this Agreement,
executed and delivered by a duly authorized officer of each Borrower, (ii) the Guarantee and
Collateral Agreement, executed and delivered by a duly authorized officer of the Company and
each Subsidiary Guarantor, (iii) a Mortgage covering each of the Mortgaged Properties,
executed and delivered by a duly authorized officer of each Loan Party thereto, (iv) the
Control Agreements, executed and delivered by a duly authorized officer of each Loan Party
thereto, (v) the Intellectual Property Security Agreements, executed and delivered by a duly
authorized officer of each Loan Party thereto, (vi) the Collateral Trust Agreement, executed
and delivered by a duly authorized officer of the Company and each Subsidiary Guarantor,
(vii) the Omnibus Assignment, executed and delivered by a duly authorized officer of each
party thereto, (viii) 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 each Borrower and (ix) a Lender Addendum executed and delivered by
each Lender and accepted by the Borrowers.

     (e)   There shall not exist (on a pro forma basis after giving effect to the
Transactions) any Default or Event of Default hereunder or any default or event of default
under the Senior Note Documents or related documents or under any other material
indebtedness or agreement of the Company or any Significant Subsidiary, or group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary (excluding in
each case the Peakers Entities).

     (f)   The capital structure (including outstanding Indebtedness) of the
Company and the Subsidiaries after the Transactions and the sources and uses of funds in
connection with the Transactions shall be reasonably satisfactory to the Arrangers.

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     (g)   The Company shall have complied with all of its obligations under and
agreements in the Engagement Letter relating to the payment in full of all fees and
reimbursable expenses payable thereunder on or prior to the Restatement Date pursuant to the
terms and conditions of the Engagement Letter, and complied with all other obligations in
the Engagement Letter in all material respects.

     (h)   The Collateral Trustee, for the ratable benefit of the Secured Parties,
shall have been granted on each of the Closing Date and the Restatement Date first priority
perfected Liens on the Collateral (other than any Excluded Perfection Assets) (subject, in
the case of all Collateral other than Pledged Securities, only to Liens expressly permitted
by Section 6.02) and customary Guarantees from the Subsidiary Guarantors and shall have
received such other reports, documents and agreements as the Collateral Trustee or the
Collateral Agent shall reasonably request and which are customarily delivered in connection
with security interests in real property assets, including title insurance that is
consistent with the title insurance that was obtained on the Closing Date. The Pledged
Securities shall have been duly and validly pledged under the Guarantee and Collateral
Agreement to the Collateral Trustee, 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
Trustee.

     (i)   Each of the facilities contemplated by this Agreement shall have
received a rating by S&P and by Moody’s.

     (j)   All material governmental and third party approvals (including
landlords’ and other consents) and consents, including approvals of FERC under the FPA and
consents and approvals of the Securities and Exchange Commission under PUHCA, and other
regulatory approvals necessary in connection with the Transactions and the continuing
operations of the Company and the Subsidiaries, taken as a whole, shall have been obtained
and be in full force and effect, and all applicable waiting periods shall have expired
without any action being taken or threatened by any competent authority that would restrain,
prevent or otherwise impose material adverse conditions on the Transactions.

     (k)   The Arrangers shall have received the financial statements and other
information required on or prior to the Restatement Date pursuant to Section 3.05 all in
form and substance satisfactory to the Arrangers.

     (l)   The Collateral Trustee and the Collateral Agent shall have received a
duly executed Perfection Certificate dated on or prior to the Restatement Date. The
Arrangers shall have received the results of a recent Lien and judgment search in each
relevant jurisdiction with respect to the Company and those of the Subsidiaries that shall
be Subsidiary Guarantors or shall otherwise have assets that are included in the Collateral,
and such search shall reveal no Liens on any of the assets of the Company or any of such
Subsidiaries except, in the case of Collateral other than Pledged Securities, for Liens
expressly permitted by Section 6.02 and except for Liens to be discharged on or prior to the
Restatement Date pursuant to documentation reasonably satisfactory to the Arrangers.

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     (m)   The Arrangers shall have received and be reasonably satisfied with (i)
an updated appraisal from BearingPoint, Inc. of certain material assets to be specified by
the Arrangers in consultation with the Company and that are to be included in the
Collateral, (ii) an updated report from Black & Veatch Corporation on certain environmental,
engineering and related matters with respect to material real property owned or leased by,
or principal facilities owned by, the Company and the Subsidiaries, as the case may be,
in each case to be specified by the Arrangers in consultation with the Company and (iii) an
updated insurance report from Marsh USA Inc. with respect to material assets to be included
in the Collateral.

     (n)   The Arrangers shall have received a solvency certificate from either
the chief financial officer or both the chief accountant and treasurer of the Company, which
certificate shall confirm the solvency of the Company and each of the Subsidiary Guarantors
after giving effect to the Transactions, all in form and substance reasonably satisfactory
to the Arrangers.

     (o)   The Arrangers shall have received evidence reasonably satisfactory to
them that the Lenders shall have assigned (or be simultaneously assigning) all loans and the
Borrower shall have repaid (or be simultaneously repaying) all other amounts outstanding
under the Original Credit Agreement on the Restatement Date (other than Existing Letters of
Credit), and that any breakage or indemnity payments in connection with such assignment or
repayment, to the extent invoiced pursuant to the terms of the Original Credit Agreement,
shall have been (or are simultaneously being) paid.

     The obligations of the Lenders to make Loans and of the Issuing Bank to issue Letters of
Credit hereunder shall not become effective unless each of the foregoing conditions is satisfied
(or waived pursuant to Section 9.08). It is understood and agreed that no term of the amendment
and restatement contemplated hereby shall be effective until the Restatement Date occurs, and that
this Agreement and the Predecessor Security Documents shall continue in full force and effect in
the form applicable prior to the amendment and restatement contemplated hereby until the
Restatement Date.

ARTICLE V.

Affirmative Covenants

     Each Borrower covenants and agrees with each Lender that so long as this Agreement shall
remain in effect and until the Commitments have been terminated and the principal of and interest
on each 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 and all Letters of Credit have been canceled or have expired and all amounts
drawn thereunder have been reimbursed in full and all Credit-Linked Deposits have been returned to
the Funded L/C Lenders (or used to reimburse Funded L/C Disbursements or converted to Term Loans),
each Borrower will, and will cause each of the Subsidiaries to:

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     SECTION 5.01.   Corporate Existence. Subject to Section 6.04 hereof, 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 each of its subsidiaries,
in accordance with the respective organizational documents (as the same may be amended from time to
time) of such Borrower or any such subsidiary; and (b) the rights (charter and statutory), licenses and franchises of such
Borrower and its subsidiaries; provided, however, that the Borrowers shall not be
required to preserve any such right, license or franchise, or the corporate, partnership or other
existence of any of its subsidiaries, if the Board of Directors of the Company shall determine that
the preservation thereof is no longer desirable in the conduct of the business of the Company and
its subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material
respect to the Lenders.

     SECTION 5.02.   Insurance. Keep its properties that are of
an insurable character adequately insured at all times by financially sound and responsible
insurers, which, in the case of any insurance on any Mortgaged Property, are licensed to do
business in the States where the applicable Mortgaged Property is located; maintain such other
insurance, to such extent and against such risks (and with such deductibles, retentions and
exclusions), including fire and other risks insured against by extended coverage and coverage for
acts of terrorism, in each case as is customary with companies of a similar size operating in the
same or similar businesses, including public liability insurance against claims for personal injury
or death or property damage; maintain such other insurance as may be required by law; and maintain
such other insurance as otherwise required by the Security Documents (and comply with all covenants
in the Security Documents with respect thereto).

     SECTION 5.03.   Taxes. Pay, and cause each of its 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 or where the failure to effect such payment
is not adverse in any material respect to the Lenders.

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

     (a)   within 90 days after the end of each fiscal year, its consolidated
balance sheet and related statements of income, stockholders’ equity and cash flows showing
the financial condition of the Company and its consolidated Subsidiaries as of the close of
such fiscal year 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 (or, in the case of the fiscal year ending December 31, 2005, the comparable period of
more than twelve months ending December 31, 2004), all audited by PricewaterhouseCoopers LLP
or 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 financial condition and results of
operations of the Company and its

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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 of the Company
and its consolidated Subsidiaries as of the close of such fiscal quarter 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 Company all adjustments necessary to present fairly in all
material respects the financial condition and results of operations of the Company 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;

     (c)   (i) concurrently with any delivery of financial statements under
paragraph (a) above, 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
Company (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 and (B) setting forth
computations in reasonable detail satisfactory to the Administrative Agent demonstrating
compliance with the covenants contained in Sections 6.10 and 6.11 and, in the case of a
certificate delivered with the financial statements required by paragraph (a) above, setting
forth the Company’s calculation of Excess Cash Flow, Adjusted Excess Cash Flow and
Consolidated EBITDA;

     (d)   at least 30 days following the commencement of each fiscal year of the
Company, a detailed consolidated budget for such fiscal year (including a 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) and, promptly when available, any significant revisions of such
budget;

     (e)   promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the Company or any
Subsidiary 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;

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

     (g)   promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of the Company or any Subsidiary, 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 Company 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
Company or any Subsidiary that could reasonably be expected to result in a Material Adverse
Effect;

     (c)   the occurrence of any ERISA Event; 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, and will cause each Loan Party to furnish, to each of the Administrative Agent, the
Collateral Agent and the Collateral Trustee prompt written notice of (i) any change (A) in any Loan
Party’s corporate name or in any trade name used to identify it in the conduct of its business or
in the ownership of its properties, (B) in the location of any Loan Party’s chief executive office,
its principal place of business, any office in which it maintains books or records relating to
Collateral owned by it or any office or facility at which Collateral owned by it is located
(including the establishment of any such new office or facility), (C) in any Loan Party’s identity
or corporate structure or (D) in any Loan Party’s Federal Taxpayer Identification Number; (ii) any
formation or acquisition after the Restatement Date of any Subsidiary; (iii) any sale, transfer,
lease, issuance or other disposition (by way of merger, consolidation, operation of law or
otherwise) after the Restatement Date of any Equity Interests of any Subsidiary to any Person other
than the Company or another Subsidiary; (iv) any liquidation or dissolution after the Restatement
Date of any Subsidiary; and (v) any Subsidiary that is an Excluded Subsidiary as of the Restatement
Date or at any time thereafter ceasing to be an Excluded Subsidiary. Each 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 10 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
Trustee to continue at all times following such change to have a valid, legal and perfected
security interest in all the Collateral (other than any Excluded Perfection Assets). Each Borrower also agrees promptly to notify each of the
Administrative Agent, the Collateral Agent and the Collateral Trustee if any material portion of
the Collateral is damaged or destroyed.

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     (b)   In the case of the Company, 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 Company setting forth 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 Restatement Date or the date of the most recent certificate delivered pursuant to this Section.

     SECTION 5.07.   Maintaining Records; Access to Properties and Inspections;
Environmental Assessments. (a) Keep, and cause each Subsidiary to keep,
proper books of record and account in which full, true and correct entries in conformity with GAAP
and all requirements of law are made of all financial operations. Each Borrower will, and will
cause each of its subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender to visit and inspect the financial records and the properties of such Borrower
or any of its subsidiaries at reasonable times and as often 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 such
Borrower or any of its subsidiaries with the officers thereof and independent accountants therefor.

     (b)   At its election, the Administrative Agent may retain an independent engineer
or environmental consultant to conduct an environmental assessment of any Mortgaged Property or
facility of the Company or any Subsidiary. Any such environmental assessments conducted pursuant
to this paragraph (b) shall be at the Company’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 Company or any Subsidiary;
provided that the Company 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
Company or any Subsidiary 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 Company or any Subsidiary. The
Company shall, and shall cause each of the 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 Company 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 Company or facility personnel, and review of applicable records and
documents pertaining to the property or facility.

     (c)   In the event that the Administrative Agent shall have reason to believe that
Hazardous Materials have been Released or are threatened to be Released on any Mortgaged

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Property
or other facility of the Company or any Subsidiary 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 Company or any of the Subsidiaries, the
Administrative Agent may, at its election and after reasonable notice to the Company, retain an
independent engineer or other qualified environmental consultant to evaluate whether Hazardous
Materials are present in the soil, groundwater, or surface water at such Mortgaged Property or
facility in violation of Environmental Law or in excess of applicable remedial action standards or
whether the facilities or properties are being operated and maintained in material compliance with
applicable Environmental Laws. 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 as are
reasonable and necessary to assess the subject matter of the Release, threatened Release or
non-compliance. The scope of any such environmental assessments under this paragraph shall be
determined in the reasonable discretion of the Administrative Agent, but shall be limited to that
reasonably necessary to assess the subject matter of the Release, threatened Release or
non-compliance. The Company shall, and shall cause each of the 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 Company of the plans to conduct
such an environmental assessment. All environmental assessments conducted pursuant to this
paragraph (c) shall be at the Company’s sole cost and expense.

     SECTION 5.08.   Use of Proceeds. Use the proceeds of the Loans and request
the issuance of Letters of Credit 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 Restatement Date or with respect to any property or
asset which becomes Collateral pursuant to the definition thereof after the Restatement Date or, in
the case of inventory or equipment, any material Collateral moved after the Restatement Date by the
Company or any other Loan Party (other than any Collateral described in paragraphs (b), (c) or (d)
of this Section) as to which the Collateral Trustee, for the benefit of the Secured Parties, does
not have a perfected security interest, promptly (and, in any event, within 20 days following the
date of such acquisition or designation) (i) execute and deliver to the Administrative Agent, the
Collateral Agent and the Collateral Trustee such amendments to the Guarantee and Collateral
Agreement or such other Security Documents as the Collateral Agent or the Collateral Trustee, as
the case may be, deems necessary or advisable to
grant to the Collateral Trustee, for the benefit of the Secured Parties, a security interest
in such Collateral and (ii) take all actions necessary or advisable to grant, to the Collateral
Trustee, for the benefit of the Secured Parties, a perfected first priority security interest in
such Collateral (other than any Excluded Perfection Assets), including the filing of UCC financing
statements in such jurisdictions as may be required by the Guarantee and Collateral Agreement or by
law or as may be requested by the Administrative Agent, the Collateral Agent or the Collateral
Trustee.

     (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 Restatement
Date by

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the Company or any other Loan Party or which becomes Collateral pursuant to the definition
thereof, 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 Trustee, for the benefit
of the Secured Parties, covering such real property and complying with the provisions herein and in
the Security Documents, (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,
the Collateral Agent or the Collateral Trustee, 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, the Collateral Agent or the Collateral Trustee and are obtainable in the
State in which such Mortgaged 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, the Collateral
Agent or the Collateral Trustee in connection with such Mortgage, each of the foregoing in form and
substance reasonably satisfactory to the Administrative Agent, the Collateral Agent and the
Collateral Trustee, (iii) deliver to the Administrative Agent, the Collateral Agent and the
Collateral Trustee 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, the
Collateral Agent and the Collateral Trustee and (iv) deliver to the Administrative Agent a notice
identifying the consultant’s reports, environmental site assessments or other documents relied upon
by the Company or any other Loan Party 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 reasonably be expected to result in a material Environmental Liability.

     (c)   With respect to any new Subsidiary (other than an Excluded Foreign Subsidiary
or an Excluded Project Subsidiary, except for an Excluded Project Subsidiary the pledge of whose
Equity Interests pursuant to the Security Documents would not cause a default under the applicable
Non-Recourse Indebtedness in respect of which it is an obligor) created or acquired after the
Restatement Date (which, for the purposes of this paragraph, shall include any existing Subsidiary
that ceases to be an Excluded Foreign Subsidiary or an Excluded Project Subsidiary and any Equity
Interests in an Excluded Project Subsidiary the pledge of which would no longer cause a default
under the applicable Non-Recourse Indebtedness in respect of which it is an obligor) by the Company
or any of the Subsidiaries, promptly (and, in any event, within 10 days following such creation or
the date of such acquisition), (i) execute and deliver to the Administrative Agent, the Collateral
Agent and the Collateral Trustee such amendments to the Guarantee and Collateral Agreement as the
Administrative Agent, the Collateral Agent or the
Collateral Trustee deems necessary or advisable to grant to the Collateral Trustee, 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 Company or any of the Subsidiaries, (ii)
deliver to the Collateral Trustee the certificates, if any, representing such Equity Interests,
together with undated stock powers, in blank, executed and delivered by a duly authorized officer
of the Company or such Subsidiary, as the case may be, (iii) cause such new Subsidiary that is not
an Excluded Subsidiary (A) to become a party to the Guarantee and Collateral Agreement (and provide
Guarantees of the Secured Obligations hereunder), the Collateral Trust Agreement and the
Intellectual Property Security Agreements and (B) to take such actions necessary or advisable

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to grant to the Collateral Trustee, for the benefit of the Secured Parties, a perfected first priority
security interest in the Collateral described in the Guarantee and Collateral Agreement and the
Intellectual Property Security Agreement with respect to such new Subsidiary that is not an
Excluded Subsidiary, including the recording of instruments in the United States Patent and
Trademark Office and the United States Copyright Office, the execution and delivery by all
necessary Persons of Control Agreements and the filing of UCC financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement, the Intellectual
Property Security Agreement or by law or as may be requested by the Administrative Agent, the
Collateral Agent or the Collateral Trustee and (iv) deliver to the Administrative Agent, the
Collateral Agent and the Collateral Trustee, if 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, the Collateral Agent and the Collateral Trustee.

     (d)   With respect to any new Excluded Foreign Subsidiary created or acquired after
the Restatement Date by the Company or any of its Subsidiaries, promptly (and, in any event, within
10 days following such creation or the date of such acquisition) (i) execute and deliver to the
Administrative Agent, the Collateral Agent and the Collateral Trustee such amendments to the
Guarantee and Collateral Agreement as the Administrative Agent, the Collateral Agent or the
Collateral Trustee deems necessary or advisable in order to grant to the Collateral Trustee, for
the benefit of the Secured Parties, a perfected first priority security interest in the Equity
Interests in such new Excluded Foreign Subsidiary that is owned by the Company or any of its
Domestic Subsidiaries (provided that in no event shall more than 66% of the total outstanding
voting Equity Interests in any such new Excluded Foreign Subsidiary be required to be so pledged),
(ii) deliver to the Collateral Trustee the certificates representing such Equity Interests,
together with undated stock powers, in blank, executed and delivered by a duly authorized officer
of the Company or such Domestic Subsidiary, as the case may be, and take such other action as may
be necessary or, in the opinion of the Administrative Agent, the Collateral Agent or the Collateral
Trustee, desirable to perfect the security interest of the Collateral Trustee thereon and (iii)
deliver to the Administrative Agent, the Collateral Agent and the Collateral Trustee, if 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, the Collateral
Agent and the Collateral Trustee.

     SECTION 5.10.   Further Assurances. 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, the Collateral Agent or the Collateral Trustee may
reasonably request, for the purposes of implementing or effectuating the provisions of this
Agreement and the other Loan Documents, or of more fully perfecting or renewing the rights of the
Administrative Agent, the Collateral Agent, the Collateral Trustee 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 Company
or any Subsidiary which may be deemed to be part of the Collateral) pursuant hereto or thereto.
Upon the exercise by the Administrative Agent, the Collateral Agent, the Collateral Trustee 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 Borrowers will

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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, the Collateral Trustee or such Lender may be required
to obtain from the Company or any of the Subsidiaries for such governmental consent, approval,
recording, qualification or authorization.

ARTICLE VI.

Negative Covenants

     Each Borrower covenants and agrees with each Lender that, so long as this Agreement shall
remain in effect and until the Commitments have been terminated and the principal of and interest
on each 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 and all Letters of Credit have been cancelled or have expired and all
amounts drawn thereunder have been reimbursed in full and all Credit-Linked Deposits have been
returned to the Funded L/C Lenders (or used to reimburse Funded L/C Disbursements or converted to
Term Loans), no Borrower will, nor will it cause or permit any of its Restricted Subsidiaries to:

     SECTION 6.01.   Indebtedness and Preferred Stock.

     (a)   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 (including Acquired Debt), and the Company will not issue any
Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of
preferred stock; provided, however, that the Company may incur Indebtedness
(including Acquired Debt) or issue Disqualified Stock, and the Subsidiary Guarantors may incur
Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company’s most
recently ended four full fiscal quarters for which financial statements are publicly available
immediately preceding the date on which such additional Indebtedness is incurred or such
Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1.0, determined on
a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the
additional Indebtedness had been incurred or Disqualified Stock or the preferred stock had been
issued, as the case may be, at the beginning of such four-quarter period.

     (b)   The provisions of Section 6.01(a) will not prohibit the incurrence of any of
the following items of Indebtedness (collectively, “Permitted Debt”):

          (i) the incurrence by the Borrowers (and the Guarantee thereof by the Subsidiary Guarantors)
of the Indebtedness created (and the reimbursement obligations with respect to Letters of Credit
issued) hereunder and any Revolver Refinancing Indebtedness;

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

          (iii) the incurrence by the Company and the Subsidiary Guarantors of Indebtedness represented
by the Senior Notes and the related Guarantees thereof, in each case, issued on or prior to the
Restatement Date;

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          (iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness
represented by 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 Company or any of its Restricted Subsidiaries, 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 (iv),
not to exceed $150,000,000 at any time outstanding;

          (v) the incurrence by the Company 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 Section 6.01(a) or clauses (ii), (iii), (iv),
(v), (xi), (xiii) or (xvi) of this Section 6.01(b);

          (vi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany
Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided,
however, that (A) if the Company or any Subsidiary Guarantor is the obligor on such
Indebtedness and the payee is not the Company or a Subsidiary Guarantor, such Indebtedness must be
expressly subordinated to the prior payment in full in cash of all Secured 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, 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 Company or a Restricted Subsidiary and (y) any sale or other transfer of any such
Indebtedness to a Person that is not either the Company or a Restricted Subsidiary will be deemed,
in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted
Subsidiary, as the case may be, that was not permitted by this clause (vi);

          (vii) the issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of
its Restricted Subsidiaries of shares of preferred stock; provided, however,
that (A) 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 a Restricted Subsidiary and (B) any sale or
other transfer of any such preferred stock to a Person that is not either the Company or a
Restricted Subsidiary 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 (vii);

          (viii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging
Obligations in the ordinary course of business and not for speculative purposes;

          (ix) the Guarantee by (A) the Company or any of the Subsidiary Guarantors of Indebtedness of
the Company or a Restricted Subsidiary that was permitted to be incurred by another provision of
this covenant; (B) any of the Excluded Project Subsidiaries of Indebtedness of any other Excluded
Project Subsidiary; and (C) any of the Excluded Foreign Subsidiaries of Indebtedness of any other
Excluded Foreign Subsidiary; provided that, in each such case, if the

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Indebtedness being guaranteed is subordinated to the Secured Obligations hereunder, then the guarantee shall be
subordinated to the same extent as the Indebtedness guaranteed;

          (x) the incurrence by the Company or any of its 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 in the ordinary course of business, so long as such Indebtedness is covered within five
Business Days;

          (xi) the Xcel Note;

          (xii) the incurrence by the Company 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 Company or a Restricted Subsidiary in the ordinary
course of business;

          (xiii) the incurrence of Additional Non-Recourse Indebtedness by any Excluded Subsidiary if,
immediately after giving effect to the incurrence of such Additional Non-Recourse Indebtedness and
the application of the proceeds therefrom, the Company’s pro forma Secured Leverage Ratio would not
exceed 2.75 to 1.0;

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

          (xv) the incurrence by the Company or any Restricted Subsidiary of Indebtedness represented by
letters of credit, guarantees of Indebtedness or other similar instruments to the extent (A) such
instruments are cash collateralized and (B) the Company or such Restricted Subsidiary would have
been permitted to expend the funds used to cash collateralize such instrument directly under the
terms of this Agreement;

          (xvi) the incurrence by the Company and/or any of its Restricted Subsidiaries of 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 (xvi), not to
exceed $250,000,000; and

          (xvii) the incurrence by the Company and/or any of its Restricted Subsidiaries of unsecured
Indebtedness or Permitted Second Priority Secured Indebtedness in each case (A) 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 provision requiring redemption or repurchase only if
and to the extent permitted by this Agreement) prior to the date that is six months after the Term
Loan Maturity Date, (B) that is not exchangeable or convertible into Indebtedness of the Company
(other than other Indebtedness permitted by this clause) or any Restricted Subsidiary or any
preferred stock or other Equity Interest and (C) solely to the extent

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the Net Cash Proceeds thereof are used to refinance Term Loans or refinance and permanently reduce commitments in respect of
Revolving Loans or Credit-Linked Deposits.

     The Company will not incur, and will not permit any Subsidiary Guarantor to incur, any
Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to
any other Indebtedness of the Company or such Subsidiary Guarantor unless such Indebtedness is also
contractually subordinated in right of payment to the Secured Obligations hereunder and the
applicable guarantees thereof on substantially identical terms; provided, however,
that no Indebtedness will be deemed to be contractually subordinated in right of payment to any
other Indebtedness of the Company solely by virtue of being unsecured or by virtue of being secured
on a first or junior Lien basis. For purposes of determining compliance with this Section 6.01, in
the event that an item of proposed Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xvi) above, or is entitled to be
incurred pursuant to Section 6.01(a), the Company will be permitted to classify such item of
Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of
Indebtedness, in any manner that complies with this Section 6.01. The accrual of interest, the
accretion or amortization of original issue discount, the payment of interest on any Indebtedness
in the form of additional Indebtedness with the same terms, and the payment of dividends on
Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will
not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes
of this Section 6.01; provided, in each such case, that the amount thereof is included in
Fixed Charges of the Company as accrued. For purposes of determining compliance with any U.S.
dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent
principal amount of Indebtedness denominated in a foreign currency will be calculated based on the
relevant currency exchange rate in effect on the date such Indebtedness was incurred;
provided that if such Indebtedness is incurred to refinance other Indebtedness denominated
in a foreign currency, and such refinancing would cause the applicable U.S. dollar-dominated
restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the
date of such refinancing, such U.S. dollar-dominated restriction shall be deemed not to have been
exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the
principal amount of the Indebtedness being refinanced. 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; provided that any changes in any of the above shall not give rise to a
default under this Section 6.01.

     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, except Permitted
Liens.

     SECTION 6.03.   Limitation on Sale and Leaseback Transactions. Enter into any sale and leaseback transaction; provided that the Company or any
Subsidiary Guarantor may enter into a sale and leaseback transaction if (a) the Company or that
Subsidiary Guarantor, as applicable, could have (i) incurred Indebtedness in an amount equal to the
Attributable Debt relating to such sale and leaseback transaction under the Fixed Charge Coverage
Ratio test in Section 6.01(a)

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hereof and (ii) incurred a Lien to secure such Indebtedness 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, as determined in good faith by the Board of Directors of the
Company; and (c) if 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 the Company applies
the proceeds of such transaction in compliance with Section 2.13.

     SECTION
6.04.   Mergers, Consolidations and Sales of Assets.
(a) 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 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 any Borrower, 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 may merge into the Company in a transaction in which the
Company is the surviving corporation, (ii) any Restricted Subsidiary may merge into or consolidate
with any other Restricted Subsidiary in a transaction in which the surviving entity is a Restricted
Subsidiary and no Person other than the Company or a Restricted Subsidiary receives any
consideration (provided that if any party to any such transaction is (A) a Loan Party, the
surviving entity of such transaction shall be a Loan Party and (B) a Domestic Subsidiary, the
surviving entity of such transaction shall be a Domestic Subsidiary) and (iii) any Restricted
Subsidiary may liquidate or dissolve if the Company determines in good faith that such liquidation
or dissolution is in the best interests of the Borrowers and is not materially disadvantageous to
the Lenders.

     (b)   Liquidate, dissolve, sell, transfer, lease, issue or otherwise dispose of (in
one transaction or in a series of transactions and whether by merger or consolidation or otherwise)
any of the Equity Interests of NRG Mid-Atlantic, NRG Northeast or NRG South Central or all or any
significant portion of the assets, including assets consisting of Equity Interests (whether now
owned or hereafter acquired), of NRG Mid-Atlantic and its subsidiaries as of the Restatement
Date, taken as a whole, NRG Northeast and its subsidiaries as of the Restatement Date, taken as a
whole, or NRG South Central and its subsidiaries as of the Restatement Date (other than NRG
Sterlington Power LLC, Bayou Cove Peaking Power LLC and Big Cajun I Peaking Power LLC for so long
as such entities shall constitute Excluded Project Subsidiaries), taken as a whole, except that the
foregoing restrictions shall not apply to (i) any such sale, transfer, lease, issuance or other
disposition to any Loan Party or Loan Parties (including any transfer to a Loan Party or Loan
Parties as a result of a liquidation or dissolution of any Subsidiary holding the Equity Interests
of NRG Mid-Atlantic, NRG Northeast or NRG South Central) or (ii) any liquidation or dissolution of
any of NRG Mid-Atlantic, NRG Northeast or NRG South Central so long as, in the case of each of
clause (i) and (ii), (A) immediately following such liquidation, dissolution, sale, transfer,
lease, issuance or other disposition, all of the subsidiaries of NRG Mid-Atlantic, NRG Northeast
and NRG South Central shall continue to be Restricted Subsidiaries, (B) the Company’s direct or
indirect ownership in such subsidiaries shall be at least equal to that which was outstanding
immediately prior to such liquidation, dissolution, sale, transfer, lease, issuance or other
disposition and (C) all subsidiaries of NRG Mid-Atlantic, NRG Northeast or NRG South Central that
were Subsidiary Guarantors immediately prior to such liquidation, dissolution sale, transfer,
lease, issuance or other disposition shall continue to be Subsidiary Guarantors

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immediately following such liquidation, dissolution, sale, transfer, lease, issuance or other disposition.

     (c)   Engage in any Asset Sale (notwithstanding that it may be otherwise permitted
under clause (iii) of paragraph (a) above) (including a Sale of Collateral) unless (i) the Company
(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 or, in the case of Specified Joint Venture Sales, receives consideration at
least equal to the value prescribed by the agreements relating to such specified joint ventures as
in effect on the Closing Date; (ii) at least 75% of the consideration received in the Asset Sale by
the Company or such Restricted Subsidiary is in the form of cash (for purposes of this provision,
each of the following will be deemed to be cash: (A) any liabilities, as shown on the Company’s
most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms subordinated to the Secured
Obligations hereunder) that are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Company or such Restricted Subsidiary from further
liability; (B) any securities, notes or other obligations received by the Company or any such
Restricted Subsidiary from such transferee that are converted by the Company 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; and (C) except in the case of a Sale of
Collateral, (x) any assets of, or any Capital Stock of, another Person engaged primarily in a
Permitted Business, if, after giving effect to any such acquisition of Capital Stock, such Person
is or becomes a wholly owned Subsidiary and (y) any other assets that are not classified as current
assets under GAAP and that are used or useful in a Permitted Business); and (iii) in the case of a
Sale of Collateral, the Company (or the Restricted Subsidiary, as the case may be) will (x) deposit
the Net Cash Proceeds (other than Excluded Proceeds) as cash collateral in a segregated account
held by the Collateral Trustee or its agent to secure the Secured Obligations hereunder or (y)
apply such Net Cash Proceeds (other than Excluded Proceeds) in accordance with Section 2.13.

     SECTION 6.05.   Restricted Payments; Restrictive Agreements.
(a) Directly or indirectly (i) declare or pay any dividend or make any other payment or
distribution on account of the Company’s or any of its Restricted Subsidiaries’ Equity Interests
(including any payment in connection with any merger or consolidation involving the Company or any
of its Restricted Subsidiaries) or to the direct or indirect holders of the Company’s or any of its
Restricted Subsidiaries’ Equity Interests in their capacity as such (other than dividends or
distributions payable in Equity Interests (other than Disqualified Stock) of the Company or to the
Company or a Restricted Subsidiary); (ii) purchase, redeem or otherwise acquire or retire for value
(including in connection with any merger or consolidation involving the Company) any Equity
Interests of the Company or any direct or indirect parent of the Company (other than any such
Equity Interests owned by the Company or any Restricted Subsidiary); (iii) make any payment on or
with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any
Indebtedness of the Company or any Subsidiary Guarantor (excluding any intercompany Indebtedness
between or among the Company and any of its Restricted Subsidiaries), except (v) a payment,
purchase, redemption, defeasance, acquisition or retirement of any subordinated Indebtedness
(excluding the Senior Notes, any Additional Notes and any Permitted Second Priority Secured
Indebtedness) in anticipation of satisfying a sinking fund obligation, principal

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installment or payment at final maturity, in each case due within one year of the date of payment, purchase,
redemption, defeasance, acquisition or retirement, (w) a payment of interest, fees or principal at
the Stated Maturity thereof, (x) a payment of the Indebtedness created hereunder, (y) refinancings
of Indebtedness permitted by Section 6.01 and (z) 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; or (iv) make any Restricted Investment (all such
payments and other actions set forth in these clauses (i) through (iv) above being collectively
referred to as “Restricted Payments”), unless, at the time of and after giving effect to
such Restricted Payment (A) no Default or Event of Default has occurred and is continuing or would
occur as a consequence of such Restricted Payment; and (B) the Company would, at the time of such
Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been permitted to incur at least
$1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in
Section 6.01(a); and (C) such Restricted Payment, together with the aggregate amount of all other
Restricted Payments made by the Company and its Restricted Subsidiaries since the Closing Date
(excluding (1) Restricted Payments permitted by clauses (ii), (iii), (iv), (vi), (vii), (viii),
(ix) and (x) of paragraph (b) below and (2) the repurchase or redemption of Senior Notes in an
amount not to exceed $375,000,000 with the proceeds of the issuance of the Preferred Stock), is
less than the sum, without duplication, of (w) 50% of the Consolidated Net Income of the Company
for the period (taken as one accounting period) from the beginning of the first fiscal quarter
commencing after the Closing Date to the end of the Company’s most recently ended fiscal quarter
for which financial statements are publicly available at the time of such Restricted Payment (or,
if such Consolidated Net Income for such period is a deficit, less 100% of such deficit), plus (x)
100% of the aggregate net cash proceeds received by the Company since the Closing Date as a
contribution to its common equity capital or from the issue or sale of Equity Interests of the
Company (other than Disqualified Stock) or from the issue or sale of convertible or exchangeable
Disqualified Stock or convertible or exchangeable debt securities of the Company that have been
converted into or exchanged for such Equity Interests (other than
Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary),
plus (y) 100% of the aggregate net cash proceeds received upon the sale or other
disposition of any Investment (other than a Permitted Investment) made since the Closing Date; plus
the net reduction in Investments (other than Permitted Investments) in any Person resulting from
dividends, repayments of loans or advances or other transfers of assets subsequent to the Closing
Date, in each case to the Company or any Restricted Subsidiary from such Person; plus to the extent
that the ability to make Restricted Payments was reduced as the result of the designation of an
Unrestricted Subsidiary, the portion (proportionate to the Company’s Equity Interest in such
Subsidiary) of the Fair Market Value of the net assets of such Unrestricted Subsidiary at the time
such Unrestricted Subsidiary is redesignated, or liquidated or merged into, a Restricted
Subsidiary; provided, in each case under this clause (y), that the foregoing may not
exceed, in the aggregate, the amount of all Investments which previously reduced the ability to
make Restricted Payments, plus (z) 50% of any dividends received by the C
ompany or a
Restricted Subsidiary that is a Subsidiary Guarantor after the Closing Date from an Unrestricted
Subsidiary, to the extent that such dividends were not otherwise included in Consolidated Net
Income of the Company for such period.

     (b)   The provisions of Section 6.05(a) will not prohibit:

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          (i) the payment of any dividend within 60 days after the date of declaration of the dividend,
if at the date of declaration the dividend payment would have complied with the provisions of this
Agreement;

          (ii) so long as no Default has occurred and is continuing or would be caused thereby, the
making of any Restricted Payment in exchange for, or out of the net cash proceeds of the
substantially concurrent sale (other than to a Subsidiary) of, Equity Interests of the Company
(other than Disqualified Stock) or from the contribution of common equity capital to the Company;
provided that the amount of any such net cash proceeds that are utilized for any such
Restricted Payment will be excluded from clause (C) (x) of Section 6.05(a);

          (iii) so long as no Default has occurred and is continuing or would be caused thereby, the
defeasance, redemption, repurchase or other acquisition of Indebtedness of the Company or any
Subsidiary Guarantor with the net cash proceeds from a substantially concurrent incurrence of
Permitted Refinancing Indebtedness;

          (iv) the payment of any dividend (or, in the case of any partnership or limited liability
company, any similar distribution) by a Restricted Subsidiary to the holders of its Equity
Interests on a pro rata basis;

          (v) so long as no Default has occurred and is continuing or would be caused thereby, (A) the
repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the
Company or any Restricted Subsidiary held by any current or former officer, director or employee of
the Company or any of its Restricted Subsidiaries pursuant to any equity subscription agreement,
stock option agreement, severance agreement, shareholders’ agreement or similar agreement, employee
benefit plan or (B) the cancellation of Indebtedness owing to the Company or any of its Restricted
Subsidiaries from any current or former officer, director or employee of the Company or any of its
Restricted Subsidiaries in connection with a repurchase
of Equity Interests of the Company or any of its Restricted Subsidiaries; provided that the
aggregate price paid for the actions in clause (A) may not exceed $1,000,000 in any twelve-month
period and $5,000,000 in the aggregate since the Closing Date; provided, further
that (x) such amount in any calendar year may be increased by the cash proceeds of “key man” life
insurance policies received by the Company and its Restricted Subsidiaries after the Closing Date
less any amount previously applied to the making of Restricted Payments pursuant to this clause (v)
and (y) cancellation of the Indebtedness owing to the Company from employees, officers, directors
and consultants of the Company or any of its Restricted Subsidiaries in connection with a
repurchase of Equity Interests of the Company from such Persons shall be permitted under this
clause (v) as if it were a repurchase, redemption, acquisition or retirement for value subject
hereto;

          (vi) the repurchase of Equity Interests in connection with the exercise of stock options to
the extent such Equity Interests represent a portion of the exercise price of those stock options;

          (vii) so long as no Default has occurred and is continuing or would be caused thereby, the
declaration and payment of regularly scheduled or accrued dividends to holders of

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any class or series of Disqualified Stock of the Company or any Restricted Subsidiary issued on or after the
Closing Date in accordance with the terms of this Agreement;

          (viii) payments, not to exceed $2,000,000 in the aggregate since the Closing Date, to holders
of the Company’s Capital Stock in lieu of the issuance of fractional shares of its Capital Stock;

          (ix) the consummation of the Refinancing Transactions and the transactions specifically
provided for in the NRG Plan as in effect on the Closing Date;

          (x) 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 pursuant
to any shareholders’ rights plan adopted for the purpose of protecting shareholders from unfair
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); and

          (xi) so long as no Default has occurred and is continuing or would be caused thereby, other
Restricted Payments in an aggregate amount not to exceed $50,000,000 since the Closing Date.

          The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the
date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued
by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment. The Fair Market Value of any assets or securities that are required to be valued by this
Section 6.05 will be determined by the Board of Directors of the Company whose resolution with
respect thereto shall be delivered to the Administrative Agent. The Board of Directors’
determination must be based upon an opinion or appraisal issued by an accounting,
appraisal or investment banking firm of national standing if the Fair Market Value exceeds
$35,000,000.

     (c)   Enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon the ability of the Company or any Restricted
Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets;
provided that the foregoing shall not apply to (i) restrictions and conditions imposed by
law or by any Loan Document, (ii) restrictions or conditions imposed by (A) the Senior Note
Documents as in effect on the Closing Date and (B) the loan documentation with respect to any
Revolver Refinancing Indebtedness (provided that such restrictions and conditions are substantially
the same as those contained herein), (iii) customary restrictions and conditions contained in
agreements relating to the sale of a Restricted Subsidiary or asset pending such sale,
provided such restrictions and conditions apply only to the Restricted Subsidiary or asset
that is to be sold and such sale is permitted hereunder, (iv) restrictions and conditions imposed
on any Restricted Subsidiary that is not a Loan Party by the terms of any Indebtedness of such
Restricted Subsidiary permitted to be incurred hereunder, (v) 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,
(vi) restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted
by this

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Agreement if such restrictions or conditions apply only to the property or assets securing
such Indebtedness, (vii) restrictions or conditions imposed by any agreement relating to any
Indebtedness incurred by a Restricted Subsidiary prior to the date on which such Restricted
Subsidiary was acquired by the Company or another Restricted Subsidiary (provided that such
restriction or condition is not created in contemplation of or in connection with such Person
becoming a Restricted Subsidiary), 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,
(viii) customary provisions in joint venture, stockholder or partnership agreements or
organizational documents relating to joint ventures or partnerships (provided that such
restrictions shall not apply to any assets that are, or but for such restrictions would be,
Collateral) and (ix) customary provisions in leases and other contracts (other than any such lease
or contract that is a Material Contract) restricting the assignment thereof (whether for collateral
purposes or otherwise).

     (d)   Directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (i) pay
dividends or make any other distributions on its Capital Stock to the Company or any of its
Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by,
its profits, or pay any Indebtedness owed to the Company or any of its Restricted Subsidiaries;
(ii) make loans or advances to the Company or any of its Restricted Subsidiaries; or (iii) transfer
any of its properties or assets to the Company or any of its Restricted Subsidiaries. The
restrictions in this Section 6.05(d) 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,
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 and the loan documentation with respect to any Revolver Refinancing
Indebtedness (provided that such restrictions and conditions are substantially the same as those
contained herein);

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

          (D) customary non-assignment provisions in contracts, agreements, leases, permits and licenses
entered into in the ordinary course of business;

          (E) purchase money obligations for property acquired in the ordinary course of business and
Capital Lease Obligations that impose restrictions on the property purchased or leased of the
nature described in clause (iii) of this Section 6.05(d) above;

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

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          (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, asset sale agreements, sale-leaseback agreements, stock sale agreements and other
similar agreements entered into with the approval of the Company’s Board of Directors, 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 imposed by customers under contracts
entered into in the ordinary course of business;

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

          (L) any instrument governing Indebtedness or Capital Stock of a Person acquired by the Company
or any of its 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;

          (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 Company;

          (N) with respect to clause (iii) of this Section 6.05(d) above only, restrictions encumbering
property at the time such property was acquired by the Company or any of its 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 restrictions of the type referred to in clauses (i), (ii) and (iii) of
this Section 6.05(d) above 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 6.05(d); provided that
such amendments, modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, in the good faith judgment of the Company’s

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Board of Directors, 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, renewals, increase, supplement, refunding, replacement or refinancing.

     SECTION 6.06.   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 Company (each, an “Affiliate Transaction”), unless (i) the Affiliate Transaction is on
terms that are no less favorable to the Company (as reasonably determined by the Company) or the
relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction
by the Company or such Restricted Subsidiary with an unrelated Person; and (ii) the Company
delivers to the Administrative Agent (A) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in excess of $10,000,000, a
resolution of the Board of Directors of the Company set forth in 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; and (B) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $35,000,000, an opinion as to the
fairness to the Company or such Restricted Subsidiary of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or investment banking firm of national
standing.

     (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
Company or any of its Restricted Subsidiaries in the ordinary course of business or approved by the
Board of Directors of the Company in good faith;

          (ii) transactions between or among the Company and/or its Restricted Subsidiaries;

          (iii) transactions with a Person (other than an Unrestricted Subsidiary) that is an Affiliate
of the Company solely because the Company owns, directly or through a Restricted Subsidiary, an
Equity Interest in, or controls, such Person;

          (iv) payment of reasonable directors’ fees to Persons who are not otherwise Affiliates of the
Company;

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

          (vi) Restricted Payments that do not violate Section 6.05(a) or (b) 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

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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 Company in good faith;

          (ix) the existence of, or the performance by the Company or any of its 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 or any of its 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 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 Company and its Restricted Subsidiaries, in the reasonable determination of the Board
of Directors of the Company 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 held by
employees of the Company or any of its Subsidiaries at a price not in excess of the Fair Market
Value thereof and, if greater than $1,000,000, approved by the Board of Directors of the Company;

          (xiii) loans or advances to employees or consultants in the ordinary course of business not to
exceed $2,000,000 in the aggregate at any one time outstanding;

          (xiv) the Reorganization Events and the Refinancing Transactions and the payment of all fees
and expenses related thereto; and

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

     SECTION 6.07.   Business Activities. (a) Engage in any
business other than Permitted Businesses, except to such extent as would not be material to the
Company and its Restricted Subsidiaries taken as a whole.

     (b)   Enter into any forward purchase or sale (or other forward acquisition or
disposition) of energy, fuel or transmission rights, or any energy tolling transaction, as a seller
of tolling services, in each case other than purchase, sale or other transactions entered into (i)
in the

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ordinary course of business and reasonable extensions thereof or (ii) in the ordinary course
of the merchant power industry.

     SECTION 6.08.   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 Company or any of the
Subsidiaries (other than in respect of any Specified Hedging Agreement) 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 Company and the Subsidiaries, taken as a whole,
or the Lenders.

     SECTION 6.09.   Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors of the Company may designate any Restricted Subsidiary (other than NRG Power
Marketing) to be an Unrestricted Subsidiary if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate Fair Market Value
of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the
Subsidiary 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 Restricted Payments under
Section 6.05(a) or under one or more clauses of the definition of Permitted Investments, as
determined by the Company. That 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 Company may
redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if that redesignation would
not cause a Default.

     SECTION 6.10.   Consolidated Interest Coverage Ratio. Permit the
Consolidated Interest Coverage Ratio at any time on or after December 31, 2004 to be less than 1.40
to 1.00.

     SECTION 6.11.   Consolidated Leverage Ratio. Permit the Consolidated
Leverage Ratio at any time on or after December 31, 2004 to be greater than 8.50 to 1:00.

     SECTION 6.12.   Fiscal Year. With respect to 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 or the Borrowings or issuances of Letters of Credit 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, shall
prove to have been false or misleading in any material respect when so made, deemed made or
furnished;

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     (b)   default shall be made in the payment of any principal of any Loan or the
reimbursement with respect to any L/C Disbursement 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 Loan or L/C
Disbursement 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 Company or
any Subsidiary of any covenant, condition or agreement contained in Section 5.01(a), 5.05 or 5.08
or in Article VI;

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

     (f)   The Company 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 (excluding any amounts paid out of the claims reserve established
pursuant to the NRG Plan), 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 this clause (ii) shall not apply to (A) secured
Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness, (B) Designated Non-Recourse Indebtedness and (C) any other
Non-Recourse Indebtedness of the Company and the Restricted Subsidiaries (except to the extent that
the Company or any of the 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 for borrowed money thereunder and such liability, individually or
in the aggregate, exceeds $50,000,000 (excluding any amounts paid out of the claims reserve
established pursuant to the NRG Plan));

     (g)   a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that (i) is for relief against the Company or any of its 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 Company or any of
its Restricted Subsidiaries (other than the Exempt Subsidiaries) that is a

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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
Company or any of its 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 Company or any of its 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 Company or any of its 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 $50,000,000 (excluding therefrom any amount covered by insurance as to which the insurer
has acknowledged in writing its coverage obligation) or other judgments that, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse Effect shall be
rendered against the Company or any Restricted Subsidiary or any combination thereof and the same
shall remain undischarged for a period of 30 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 Company or any of its Restricted Subsidiaries to enforce any such judgment;

     (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 Company and its ERISA
Affiliates in an aggregate amount exceeding $50,000,000;

     (k)   except as permitted by this Agreement or as a result of the discharge of such
Subsidiary Guarantor in accordance with the terms of the Loan Documents, any Guarantee under the
Guarantee and Collateral Agreement shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or any Subsidiary Guarantor
(or any group of Subsidiary Guarantors) that constitutes a Significant Subsidiary, or any Person
acting on behalf of any Subsidiary Guarantor (or any group of Subsidiary Guarantors) that
constitutes a Significant Subsidiary, shall deny or disaffirm its or their obligations under its or
their Guarantee(s) under the Guarantee and Collateral Agreement;

     (l)   material breach by the Company or any of its Restricted Subsidiaries of any
material representation or warranty or agreement in the Security Documents, the repudiation by the
Company or any of its Restricted Subsidiaries of any of its material obligations under any of the
Security Documents or the unenforceability of any of the Security Documents against the Company or
any of its Restricted Subsidiaries for any reason with respect to Collateral having an aggregate
Fair Market Value of $25,000,000 or more; or

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

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then, and in every such event (other than an event with respect to any of the Borrowers 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: (i) the Administrative Agent may with the
consent of the Majority Revolving Credit Lenders, and at the request of the Majority Revolving
Credit Lenders shall, by notice to the Company, terminate forthwith the Revolving Credit
Commitments and the Swingline Commitment and (ii) the Administrative Agent may with the consent of
the Majority Lenders, and at the request of the Majority Lenders shall, by notice to the Company,
declare the Loans then outstanding to be forthwith due and payable in whole or in part, whereupon
the principal of the Loans so declared to be due and payable, together with accrued interest
thereon and any unpaid accrued Fees and all other liabilities of the Borrowers 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
Borrowers, 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 any of the Borrowers described in paragraph (g) or (h) above, the Revolving Credit
Commitments and the Swingline Commitment shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of the Borrowers 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 Borrowers, 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.

     Without limitation of, and after giving effect to, Section 6.7 of the Guarantee and Collateral
Agreement and Section 3.4 of the Collateral Trust Agreement, all proceeds received by the
Administrative Agent or the Collateral Agent, as the case may be, either from the Collateral
Trustee or any other 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 Secured Obligations hereunder
then due and owing in the following order of priority: first, to the ratable payment of
(a) all costs and expenses of such sale, collection or other realization, including compensation to
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, 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, (b) any principal and interest owed to the Administrative Agent in respect of
outstanding Revolving Loans advanced on behalf of any Lender by the Administrative Agent for which
the Administrative Agent has not then been reimbursed by such Lender or the Company, (c) any
principal and interest owed to the Swingline Lender in respect of outstanding Swingline Loans that
have not been repaid and (d) any amounts owed to any Issuing Bank under a Letter of Credit issued
by it for which it has not then been reimbursed by any Lender or the

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Company; second, to the extent of any excess proceeds, to the payment of all other Secured Obligations hereunder 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 applicable Loan Party 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 and the Issuing Bank 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 Collateral Trust Agreement) with respect to the Collateral
and the rights of the Secured Parties with respect thereto, and to appoint the Collateral Trustee
as their agent in respect of the Collateral Trust Agreement and the other Security Documents, in
each case as contemplated by and in accordance with the provisions of this Agreement and the
Security Documents. The Collateral Trustee is hereby expressly authorized and directed by the
Lenders to execute the Collateral Trust Agreement and the other Security Documents (and any other
documents contemplated thereby), in each case, on the Restatement Date. Each of the Lenders and
the Issuing Bank hereby agrees to be bound by the priority of the security interests and allocation
of the benefits of the Collateral and proceeds thereof set forth in the Security Documents. In
addition, each of the Lenders acknowledges the Credit Agreement Parallel Debt (as defined in the
Collateral Trust Agreement) that has been created in the Collateral Trust Agreement in favor of the
Collateral Trustee.

     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 Company 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 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 Company 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

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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 Agent
shall be deemed to have knowledge of any Default unless and until written notice thereof is given
to such Agent by the Company 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 any 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, the Issuing Bank and the Company. 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 Company’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 and the Issuing Bank, 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 Borrowers to a successor Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrowers and such successor. After an Agent’s
resignation hereunder, the provisions of this Article and

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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, each Co-Documentation 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. It is understood and agreed that, as of the Restatement
Date, (a) General Electric Capital Corporation’s role as Revolver Agent under the Original Credit
Agreement shall be terminated and (b) General Electric Capital Corporation shall no longer have any
duties (or liabilities) as an agent under this Agreement.

     Each Lender acknowledges that it has, independently and without reliance upon the Agents, the
Arrangers, the Syndication Agent, the Co-Documentation Agents 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, the Co-Documentation Agents or any other Lender and based on such documents and
information as it 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 a Borrower, to it at NRG Energy, Inc., 211 Carnegie Center,
Princeton, NJ 08540, Attention of Treasurer, Chief Financial Officer and General Counsel
(Fax No. (609) 524-4501);

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     (b)   if to the Administrative Agent or the Collateral Agent, to Credit
Suisse First Boston, Eleven Madison Avenue, New York, NY 10010, Attention of Julia Kingsbury
(Fax No. (212) 325-8304); 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 Borrowers 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 the Issuing Bank and shall survive the making by the Lenders of the Loans and the
Credit-Linked Deposits and the issuance of Letters of Credit by the Issuing Bank, regardless of any
investigation made by the Lenders or the Issuing Bank or on their behalf, and shall continue in
full force and effect as long as the principal of or any accrued interest on any 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 outstanding and unpaid or
any Letter of Credit or Credit-Linked Deposit is outstanding and so long as the Commitments have
not been terminated. The provisions of Sections 2.14, 2.16, 2.20 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 Loans, the
expiration of the Commitments, the expiration of any Letter of Credit, the return, application or
conversion of the Credit-Linked Deposits, 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, any Lender or the Issuing Bank.

     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 each Borrower, the Administrative Agent, the Collateral Agent, the Issuing Bank or
the Lenders that are contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.

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     (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
Commitment and the Loans or Credit-Linked Deposits at the time owing to it); provided,
however, that (i) (x) except in the case of an assignment of a Term Loan or a Credit-Linked
Deposit to an Affiliate or Related Fund of a Lender, the Administrative Agent (and, in the case of
any assignment of a Revolving Credit Commitment, the Issuing Bank and the Swingline Lender) must
give its prior written consent to such assignment (which consent shall not be unreasonably withheld
or delayed) 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 Commitment 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, if less, the entire
remaining amount of such Lender’s Commitment), (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 with a processing and recordation fee of $3,500 paid by the assignor or assignee) 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 Commitment and the Loans or Credit-Linked Deposits 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 of Sections 2.14, 2.16, 2.20 and 9.05, as well as to any
Fees accrued for its account and not yet paid). Without the consent of the Company (which consent
shall not be unreasonably withheld) and the Administrative Agent, the Credit-Linked Deposit of any
Funded L/C Lender shall not be released in connection with any assignment by such Funded L/C
Lender, but shall instead be purchased by the relevant assignee and continue to be held for
application (to the extent not already applied) in accordance with Section 2.23(d) to satisfy such
assignee’s obligations in respect of Funded L/C Disbursements. 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 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 Borrowers 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.

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     (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 Revolving Credit Commitment, and the outstanding
balances of its Term Loans and Revolving Loans and Credit-Linked Deposits and participations in
Funded Letters of Credit, in each case 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 any Borrower or
any Subsidiary or the performance or observance by any Borrower or any Subsidiary 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 Arrangers, the Syndication Agent, either
Co-Documentation Agent, 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 each
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 Loans owing to, each
Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the
Register shall be conclusive and each Borrower, the Administrative Agent, the Issuing Bank, 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 each
Borrower, the Issuing Bank, 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.

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     (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 Swingline Lender, the Issuing Bank and the 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,
the Issuing Bank, the Swingline Lender and the Company. 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 Borrowers 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 any Borrower, the Swingline Lender, the
Issuing Bank 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 Commitment and the Loans and Credit-Linked Deposits and participations in Funded Letters of
Credit 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 contained in
Sections 2.14, 2.16 and 2.20 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) each Borrower, the Administrative Agent, the Issuing Bank 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 each Borrower relating to the Loans or L/C Disbursements 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 Loans, extending any scheduled principal payment date or
date fixed for the payment of interest on the Loans or the Credit-Linked Deposits, increasing or
extending the Commitments or releasing any Subsidiary Guarantor or all or any substantial part 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 any Borrower furnished to such Lender by or on behalf of the Borrowers;
provided that, prior to any such disclosure of information designated by any 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.

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     (h)   Any Lender may 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 Company, the option to provide to any Borrower all or any part of any Loan that such
Granting Lender would otherwise be obligated to make to such Borrower pursuant to this Agreement;
provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan
and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part
of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms
hereof. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting
Lender to the same extent, and as if, such 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 Company and the Administrative Agent and without paying any processing fee
therefor, assign all or a portion of its interests in any Loans to the Granting Lender or to any
financial institutions (consented to by the Company and Administrative Agent) providing liquidity
and/or credit support to or for the account of such SPC to support the funding or maintenance of
Loans and (ii) disclose on a confidential basis any non-public information relating to its 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, the Issuing Bank and each Lender,
and any attempted assignment without such consent shall be null and void.

     SECTION 9.05.   Expenses; Indemnity. (a) The Borrowers
agree, jointly and severally, to pay all reasonable out-of-pocket expenses incurred by the
Administrative Agent, the Collateral Agent, the Syndication Agent, the Co-Documentation Agents, the
Arrangers, the Issuing Bank and the Swingline Lender, 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

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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
Borrowers shall not be responsible for the reasonable fees, charges and disbursements of more than
one separate law firm (in addition to local or special counsel, including special workout counsel)
pursuant to its obligations under this sentence only. The Borrowers also agree, jointly and
severally, to pay all out-of-pocket expenses incurred by the Administrative Agent, the Collateral
Agent, the Syndication Agent, the Co-Documentation Agents, the Arrangers, the Issuing Bank 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 Loans or Credit-Linked Deposits
made or Letters of Credit issued 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, the Issuing Bank
or any Lender.

     (b)   The Borrowers agree, jointly and severally, to indemnify the Administrative
Agent, the Collateral Agent, the Syndication Agent, the Co-Documentation Agents, the Arrangers,
each Lender, the Issuing Bank 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 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 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 Loans or
Credit-Linked Deposits or issuance of Letters of Credit, (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 on any property owned or
operated by the Company or any of the Subsidiaries, or any Environmental Liability related in any
way to the Company 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.

     (c)   To the extent that the Borrowers fail to pay any amount required to be paid by
them to the Administrative Agent, the Collateral Agent, the Syndication Agent, the Co-Documentation
Agents, the Arrangers, the Issuing Bank or the Swingline Lender under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent, the Collateral Agent, the
Syndication Agent, the Co-Documentation Agents, the Arrangers, the Issuing Bank or the Swingline
Lender, 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, the Co-Documentation Agents, the Arrangers, the
Issuing Bank or the Swingline Lender in its capacity

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as such. For purposes hereof, a Lender’s “pro rata share” shall be determined based upon its share of the sum of the Aggregate Revolving Credit
Exposure, outstanding Term Loans and Credit-Linked Deposits and unused Commitments at the time.

     (d)   To the extent permitted by applicable law, no Borrower shall assert, and each
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 Loan, Credit-Linked Deposit or Letter of Credit 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 Loans, the return, application or
conversion of any of the Credit-Linked Deposits, the expiration of the Commitments, the expiration
of any Letter of Credit, 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 Co-Documentation Agents, the
Arrangers, any Lender or the Issuing Bank. All amounts due under this Section 9.05 shall be
payable on 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 any Borrower against any of and all the obligations
of any 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
(OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER LOAN DOCUMENTS) SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. EACH LETTER OF
CREDIT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES
DESIGNATED IN SUCH LETTER OF CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM
CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS MOST RECENTLY PUBLISHED AND IN EFFECT, ON THE DATE
SUCH LETTER OF CREDIT WAS ISSUED, BY THE INTERNATIONAL CHAMBER OF COMMERCE (THE “UNIFORM
CUSTOMS”) AND, AS TO MATTERS NOT GOVERNED BY THE UNIFORM CUSTOMS, THE LAWS OF THE STATE OF NEW
YORK.

     SECTION 9.08.   Waivers; Amendment; Replacement of Non-Consenting
Lenders . (a) No failure or delay of the Administrative Agent, the Collateral
Agent, any Lender or the

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Issuing Bank 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, the Issuing Bank 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 any 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 any Borrower in any case shall entitle such
Borrower to any other or further notice or demand in similar or other circumstances.

     (b)   Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into by each Borrower and
the Required Lenders; provided, however, that no such agreement shall (i) decrease
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 Loan or any date for reimbursement of an L/C Disbursement or
extend the date on which the Credit-Linked Deposits are required to be returned in full, or waive
or excuse any such payment or any part thereof, or decrease the rate of interest on any Loan,
Credit-Linked Deposit or L/C Disbursement, without the prior written consent of each Lender
affected thereby, (ii) increase or extend the 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 Section 9.04(j), the provisions of
this Section or the definition of the term “Required Lenders” or “Majority Lenders,” or release
any Subsidiary Guarantor, without the prior written consent of each Lender, (iv) amend or modify
the definition of the term “Majority Term Lenders” without the prior written consent of each Term
Lender and Funded L/C Lender, (v) amend or modify the definition of the term “Majority Revolving
Credit Lenders” without the prior written consent of each Revolving Credit Lender, (vi) release all
or any substantial part of the Collateral without the prior written consent of each Lender, (vii)
change the provisions of any Loan Document in a manner that by its terms adversely affects the
rights in respect of payments due to Lenders holding Loans of one Class differently from the rights
of Lenders holding Loans of any other Class without the prior written consent of Lenders holding a
majority in interest of the outstanding Loans and unused Commitments of each adversely affected
Class or (viii) 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, the
Collateral Agent, the Issuing Bank or the Swingline Lender hereunder or under any other Loan
Document without the prior written consent of the Administrative Agent, the Collateral Agent, the
Issuing Bank or the Swingline Lender, as applicable.

     (c)   Each Lender grants (i) to the Administrative Agent the right (with the prior
written consent of the Borrower) to purchase all (but not less than all) of such Lender’s
Commitments and 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 Term Loan

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Borrower the right to cause an assignment of all (but not less than all) of such Lender’s Commitments and 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 Term Loan 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 (A) payment equal to the aggregate amount of
outstanding Loans owed to such Lender, together with all accrued and unpaid interest, fees and
other amounts (other than indemnities and other contingent amounts not then due) owed to such
Lender under the Loan Documents at such time and (B) from the Term Loan Borrower, any Prepayment
Fee that would be payable to such Non-Consenting Lender if such assignment were deemed to be a
voluntary prepayment of the Term Loans or an optional reduction of the Credit-Linked Deposit of
such Lender for purposes of Section 2.05(e). Each Lender agrees that if the Administrative Agent
or the Term Loan 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 Term Loan 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 Term Loan
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 Loan or Credit-Linked Deposit
or participation in any L/C Disbursement, together with all fees, charges and other amounts which
are treated as interest on such Loan or participation in such L/C Disbursement 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 Loan or participation in accordance with applicable law, the rate of interest payable in
respect of such Loan or participation 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 Loan or participation 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 Loans or participations 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 Engagement 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
(including any Affiliate of the Issuing Bank that issues any Letter of Credit) and, to the extent
expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the
Collateral Agent, the Syndication Agent, the Co-Documentation

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Agents, the Arrangers, the Issuing Bank 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 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) Each 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

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manner provided by law. Nothing in this Agreement shall affect any right
that the Administrative Agent, the Collateral Agent, the Syndication Agent, the Co-Documentation
Agents, the Arrangers, the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or the other Loan Documents against any Borrower or its
properties in the courts of any jurisdiction.

     (b)   Each 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, the Issuing Bank 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
regulations 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 or (ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Company or any Subsidiary or any of their respective
obligations, (f) with the consent of the Company 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 Company or its Subsidiaries and related to the
Company 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, the Issuing Bank or any Lender on a nonconfidential basis prior to its disclosure by the
Company; provided that, in the case of Information received from the Company after the
Restatement 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

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permitted to disclose to any Persons, without limitation, the tax treatment and tax
structure of the 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 Loans or the transactions contemplated by the Loan Documents.

     SECTION 9.17.   Joint and Several Liability; Postponement of Subrogation.
(a) The obligations of the Revolving Loan Borrowers hereunder and under the other Loan Documents
shall be joint and several and, as such, each Revolving Loan Borrower shall be liable for all of
the Secured Obligations of the other Revolving Loan Borrower under this Agreement and the other
Loan Documents. The liability of each Revolving Loan Borrower for the Secured Obligations of the
other Revolving Loan Borrower under this Agreement and the other Loan Documents shall be absolute,
unconditional and irrevocable, without regard to (a) the validity or enforceability of this
Agreement or any other Loan Document, any of the Secured Obligations or any other collateral
security therefor or guarantee or right of offset with respect thereto at any time or from time to
time held by any Secured Party, (b) any defense, set-off or counterclaim (other than a defense of
payment or performance hereunder) which may at any time be available to or be asserted by such
other Revolving Loan Borrower or any other Person against any Secured Party or (c) any other
circumstance whatsoever (with or without notice to or knowledge of such other Revolving Loan
Borrower or such Revolving Loan Borrower) which constitutes, or might be construed to constitute,
an equitable or legal discharge of such other Revolving Loan Borrower for the Secured Obligations,
or of such Revolving Loan Borrower under this Section, in bankruptcy or in any other instance.

     (b) Each Revolving Loan Borrower agrees that it will not exercise any rights which it may
acquire by way of rights of subrogation under this Agreement, by any payments made hereunder or
otherwise, until the prior payment in full in cash of all of the Secured Obligations, the
termination or expiration of all Revolving Letters of Credit and the permanent termination of all
Revolving Credit Commitments. Any amount paid to any Revolving Loan Borrower on account of any
such subrogation rights prior to the payment in full in cash of all of the Secured Obligations, the
termination or expiration of all Revolving Letters of Credit and the permanent termination of all
Revolving Credit Commitments shall be held in trust for the benefit of the Secured Parties and
shall immediately be paid to the Administrative Agent for the benefit of the Secured Parties and
credited and applied against the Secured Obligations of the Revolving Loan Borrowers, whether
matured or unmatured, in such order as the Administrative Agent shall elect. In furtherance of the
foregoing, for so long as any Secured Obligations, Revolving Letters of Credit or Revolving Credit
Commitments remain outstanding, each Revolving Loan Borrower shall refrain from taking any action
or commencing any proceeding against the other Revolving Loan Borrower (or any of its successors or
assigns, whether in connection with a bankruptcy
proceeding or otherwise) to recover any amounts in respect of payments made in respect of the
Secured Obligations of the other Revolving Loan Borrower to any Secured Party.

     SECTION 9.18.   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 Borrowers and the Administrative Agent.

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     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 ENERGY, INC.

 	 
	 	By:  	/s/ David W. Crane
 	 
	 	 	Name:  	David W. Crane 	 
	 	 	Title:  	Chief Executive Officer 	 
	 

	 	 	 	 	 
	 	NRG POWER MARKETING INC.

 	 
	 	By:  	/s/ George Schaefer
 	 
	 	 	Name:  	George Schaefer 	 
	 	 	Title:  	Treasurer 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	 	CREDIT SUISSE FIRST BOSTON, acting through its
	 	 	Cayman Islands Branch, as Administrative Agent,
	 	 	Collateral Agent, Swingline Lender, Issuing Bank,
	 	 	Co-Documentation Agent and Arranger,
	 
	 	 	 	 
	

	 	By:
	 	 /s Jay Chall                                                                                               
	

	 	 	 	Name: Jay Chall
	

	 	 	 	Title: Director
	 
	 	 	 	 
	

	 	By:
	 	 /s/ Denise L. Alvarez                                                                                
	

	 	 	 	Name: Denise L. Alvarez
	

	 	 	 	Title: Associate

 

 

	 	 	 	 	 
	 	 	GOLDMAN SACHS CREDIT PARTNERS L.P., as Syndication
	 	 	Agent, Co-Documentation Agent and Arranger,
	 
	 	 	 	 
	

	 	By:
	 	 /s/ William W. Archer
	

	 	 	 	Name: William W. Archer
	

	 	 	 	Title: Managing Directorexv10w26

 

EXHIBIT 10.26

EXECUTION COPY

 

 

GUARANTEE AND COLLATERAL AGREEMENT

dated as of December 23, 2003

as amended and restated as of December 24, 2004

made by

NRG ENERGY, INC.,

NRG POWER MARKETING INC.

and certain of the Subsidiaries of NRG Energy, Inc.

in favor of

DEUTSCHE BANK TRUST COMPANY AMERICAS,

as Priority Collateral Trustee, Parity Collateral Trustee

and Account Collateral Trustee

CREDIT SUISSE FIRST BOSTON,

as Administrative Agent

and

LAW DEBENTURE TRUST COMPANY OF NEW YORK,

as Trustee

 

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	SECTION 1.	 	DEFINED TERMS	 	 	2	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	1.1.	 	 	Definitions
	 	 	2	 
	

	 	 	1.2.	 	 	Other Definitional Provisions
	 	 	19	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 2.	 	GUARANTEE	 	 	19	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	2.1.	 	 	Guarantee
	 	 	19	 
	

	 	 	2.2.	 	 	Rights of Reimbursement, Contribution and Subrogation
	 	 	21	 
	

	 	 	2.3.	 	 	Amendments, etc. with respect to the Borrower Obligations
	 	 	23	 
	

	 	 	2.4.	 	 	Guarantee Absolute and Unconditional
	 	 	23	 
	

	 	 	2.5.	 	 	Reinstatement
	 	 	24	 
	

	 	 	2.6.	 	 	Payments
	 	 	25	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 3.	 	GRANT OF SECURITY INTEREST; CONTINUING LIABILITY UNDER COLLATERAL	 	 	25	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 4.	 	REPRESENTATIONS AND WARRANTIES	 	 	28	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	4.1.	 	 	Representations in Secured Debt Documents
	 	 	28	 
	

	 	 	4.2.	 	 	Title; No Other Liens
	 	 	28	 
	

	 	 	4.3.	 	 	Perfected First Priority Liens
	 	 	28	 
	

	 	 	4.4.	 	 	Name; Jurisdiction of Organization, etc.
	 	 	29	 
	

	 	 	4.5.	 	 	Inventory and Equipment
	 	 	29	 
	

	 	 	4.6.	 	 	Condition and Maintenance of Equipment
	 	 	30	 
	

	 	 	4.7.	 	 	Farm Products
	 	 	30	 
	

	 	 	4.8.	 	 	Investment Property
	 	 	30	 
	

	 	 	4.9.	 	 	Receivables
	 	 	31	 
	

	 	 	4.10.	 	 	Contracts
	 	 	31	 
	

	 	 	4.11.	 	 	Intellectual Property
	 	 	32	 
	

	 	 	4.12.	 	 	Letters of Credit and Letter of Credit Rights
	 	 	34	 
	

	 	 	4.13.	 	 	Commercial Tort Claims
	 	 	35	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 5.	 	COVENANTS	 	 	35	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	5.1.	 	 	Covenants in Secured Debt Documents
	 	 	35	 
	

	 	 	5.2.	 	 	Delivery and Control of Instruments, Certificated
Securities, Chattel Paper, Negotiable Documents, Investment Property
and Letter of Credit Rights
	 	 	37	 
	

	 	 	5.3.	 	 	Maintenance of Insurance
	 	 	37	 
	

	 	 	5.4.	 	 	Payment of Secured Obligations
	 	 	38	 
	

	 	 	5.5.	 	 	Maintenance of Perfected Security Interest; Further Documentation
	 	 	38	 
	

	 	 	5.6.	 	 	Changes in Location, Name, Jurisdiction of Incorporation, etc
	 	 	39	 
	

	 	 	5.7.	 	 	Notices.
	 	 	39	 
	

	 	 	5.8.	 	 	Investment Property
	 	 	39	 
	

	 	 	5.9.	 	 	Receivables
	 	 	41	 
	

	 	 	5.10.	 	 	Contracts
	 	 	42	 

i

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	

	 	 	5.11.	 	 	Intellectual Property
	 	 	43	 
	

	 	 	5.12.	 	 	Commercial Tort Claims
	 	 	45	 
	

	 	 	5.13.	 	 	Deposit and Securities Accounts
	 	 	45	 
	

	 	 	5.14.	 	 	Collections
	 	 	46	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 6.	 	REMEDIAL PROVISIONS	 	 	46	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	6.1.	 	 	Certain Matters Relating to Receivables
	 	 	46	 
	

	 	 	6.2.	 	 	Communications with Obligors; Grantors Remain Liable
	 	 	47	 
	

	 	 	6.3.	 	 	Pledged Securities
	 	 	48	 
	

	 	 	6.4.	 	 	Intellectual Property; Grant of License
	 	 	49	 
	

	 	 	6.5.	 	 	Intellectual Property Litigation and Protection
	 	 	49	 
	

	 	 	6.6.	 	 	Proceeds to be Turned Over To Collateral Trustee
	 	 	50	 
	

	 	 	6.7.	 	 	Application of Proceeds
	 	 	50	 
	

	 	 	6.8.	 	 	Code and Other Remedies.
	 	 	50	 
	

	 	 	6.9.	 	 	Registration Rights
	 	 	52	 
	

	 	 	6.10.	 	 	Deficiency
	 	 	53	 
	

	 	 	6.11.	 	 	Separate Liens
	 	 	53	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 7.	 	THE COLLATERAL TRUSTEE	 	 	53	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	7.1.	 	 	Collateral Trustee’s Appointment as Attorney-in-Fact, etc.
	 	 	53	 
	

	 	 	7.2.	 	 	Duty of Collateral Trustee
	 	 	54	 
	

	 	 	7.3.	 	 	Execution of Financing Statements
	 	 	55	 
	

	 	 	7.4.	 	 	Authority of Collateral Trustee
	 	 	55	 
	

	 	 	7.5.	 	 	Access to Collateral, Books and Records; Other Information
	 	 	56	 
	

	 	 	7.6.	 	 	Appointment of Co-Collateral Agents
	 	 	56	 
	 
	 	 	 	 	 	 	 	 	 	 
	SECTION 8.	 	MISCELLANEOUS	 	 	56	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	8.1.	 	 	Amendments in Writing
	 	 	56	 
	

	 	 	8.2.	 	 	Notices
	 	 	57	 
	

	 	 	8.3.	 	 	No Waiver by Course of Conduct; Cumulative Remedies
	 	 	57	 
	

	 	 	8.4.	 	 	Enforcement Expenses; Indemnification
	 	 	57	 
	

	 	 	8.5.	 	 	Successors and Assigns
	 	 	58	 
	

	 	 	8.6.	 	 	Set-Off
	 	 	58	 
	

	 	 	8.7.	 	 	Counterparts
	 	 	58	 
	

	 	 	8.8.	 	 	Severability
	 	 	58	 
	

	 	 	8.9.	 	 	Section Headings
	 	 	58	 
	

	 	 	8.10.	 	 	Integration
	 	 	59	 
	

	 	 	8.11.	 	 	APPLICABLE LAW
	 	 	59	 
	

	 	 	8.12.	 	 	Submission to Jurisdiction; Waivers
	 	 	59	 
	

	 	 	8.13.	 	 	Acknowledgments
	 	 	59	 
	

	 	 	8.14.	 	 	Additional Grantors
	 	 	60	 
	

	 	 	8.15.	 	 	Releases
	 	 	60	 
	

	 	 	8.16.	 	 	Conflicts
	 	 	60	 
	

	 	 	8.17.	 	 	WAIVER OF JURY TRIAL
	 	 	60	 
	

	 	 	8.18.	 	 	Additional Guaranteed Secured Debt Representatives
	 	 	60	 
	

	 	 	8.19.	 	 	Rights and Immunities of Secured Debt Representatives
	 	 	60	 

ii

 

	 	 	 	 	 
	Exhibits:	 	 
	 
	 	 	 	 
	

	 	Exhibit A
	 	Form of Pledged Deposit Account Control Agreement
	

	 	Exhibit B
	 	Form of Pledged Securities Account Control Agreement
	

	 	Exhibit C
	 	Form of Commodity Account Control Agreement
	

	 	Exhibit D
	 	Form of Acknowledgment and Consent
	

	 	Exhibit E
	 	Form of Intellectual Property Security Agreement
	

	 	Exhibit F
	 	Form of After-Acquired Intellectual Property Security Agreement
	 
	 	 	 	 
	Annex:	 	 
	 
	 	 	 	 
	

	 	Annex 1
	 	Assumption Agreement

	 	 	 	 	 
	Schedules:	 	 
	 	 	 
	

	 	Schedule 1.1(a)
	 	Excluded Foreign Subsidiaries
	

	 	Schedule 1.1(b)
	 	Excluded Project Subsidiaries
	

	 	Schedule 1.1(c)
	 	Immaterial Subsidiaries
	

	 	Schedule 4.3(a)
	 	Filings and Other Actions Required to Perfect Security Interests
	

	 	Schedule 4.4
	 	Organizational Information
	

	 	Schedule 4.5(a)
	 	Location of Inventory and Equipment
	

	 	Schedule 4.5(b)
	 	Bailees and Warehousemen
	

	 	Schedule 4.8(a)
	 	Description of Equity Instruments
	

	 	Schedule 4.8(b)
	 	Description of Pledged Debt Instruments
	

	 	Schedule 4.8(c)
	 	Description of Pledged Accounts
	

	 	Schedule 4.10(a)
	 	Material Contracts
	

	 	Schedule 4.10(b)
	 	Non-Assignable Contracts
	

	 	Schedule 4.11(a)
	 	Intellectual Property
	

	 	Schedule 4.11(c)
	 	Licenses, etc.
	

	 	Schedule 4.11(e)
	 	Releases, etc.
	

	 	Schedule 4.12
	 	Letter of Credit Rights
	

	 	Schedule 4.13
	 	Commercial Tort Claims
	

	 	Schedule 8.2
	 	Notice Addresses of Guarantors

i

 

          GUARANTEE AND COLLATERAL AGREEMENT, dated as of December 23, 2003, as amended and restated as
of December 24, 2004, made by each of the signatories hereto, in favor of Deutsche Bank Trust
Company Americas, (i) in its capacity as Priority Collateral Trustee for Credit Suisse First
Boston, 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 for the banks and other financial institutions or
entities (the “Lenders”) from time to time parties to the Credit Agreement dated as of
December 23, 2003, as amended and restated on December 24, 2004 (as amended, restated, supplemented
or otherwise modified from time to time, the “Credit Agreement”), among NRG Energy, Inc., a
Delaware corporation (the “Company”), NRG Power Marketing Inc., a Delaware corporation
(“NRG Power Marketing” and, together with the Company, the “Credit Agreement
Borrowers”), the Lenders, Credit Suisse First Boston, and Goldman Sachs Credit Partners L.P.,
as joint lead book runners and joint lead arrangers (in such capacity, the “Arrangers”) and
as co-documentation agents, Goldman Sachs Credit Partners L.P., as syndication agent (in such
capacity, the “Syndication Agent”) and the other Priority Lien Secured Parties thereunder,
(ii) in its capacity as Parity Collateral Trustee for Law Debenture Trust Company of New York, as
trustee (in such capacity and together with its successors, the “Trustee”) under the
Indenture, dated as of December 23, 2003 (as amended, restated, supplemented, or otherwise modified
from time to time, the “Indenture”), among the Company, certain of its subsidiaries, the
Trustee and the other Parity Lien Secured Parties thereunder, (iii) in its capacity as Account
Collateral Trustee, for the Priority Lien Secured Parties and the Parity Lien Secured Parties and
(iv) in its capacity as Priority Collateral Trustee, Parity Collateral Trustee and/or Account
Collateral Trustee, as applicable, for any other Secured Parties (as hereinafter defined) from time
to time entitled to the benefits of the Collateral Trust Agreement, dated as of December 23, 2003,
as amended and restated as of December 24, 2004 (as the same may be amended, restated, supplemented
or otherwise modified from time to time, the “Collateral Trust Agreement”), among the
Company, the other Grantors, the Administrative Agent, the Trustee, the Collateral Trustee and the
other parties from time to time party thereto; and, for purposes of Section 2, in favor of the
Administrative Agent and the Trustee and any other future Guaranteed Secured Debt Representative
(as hereinafter defined) with respect to any Series of Guaranteed Secured Debt (as hereinafter
defined) that becomes entitled to the benefits of the Collateral Trust Agreement.

WITNESSETH:

          WHEREAS, on the Closing Date, the parties thereto entered into the Original Guarantee and
Collateral Agreement and on the Restatement Date, this Agreement will be amended and restated in
the form hereof;

          WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to make
extensions of credit to the Credit Agreement Borrowers upon the terms and subject to the conditions
set forth therein, and, pursuant to the Indenture, the Company has issued $1,725,000,000 in
aggregate principal amount of Second Priority Senior Secured Notes due 2013 (the “Notes”);

          WHEREAS, the Credit Agreement Borrowers are members of an affiliated group of companies that
includes each other Grantor;

 

 

          WHEREAS, the proceeds of the extensions of credit under the Credit Agreement will be used, and
the proceeds of the offering of the Notes have been used, in part to enable the Credit Agreement
Borrowers or the Company, as the case may be, to make valuable transfers to one or more of the
other Grantors in connection with the operation of their respective businesses;

          WHEREAS, the Credit Agreement Borrowers and the other Grantors are engaged in related
businesses, and each Grantor will derive (or has derived) substantial direct and indirect benefit
from the making of the extensions of credit under the Credit Agreement and the offering of the
Notes;

          WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respective
extensions of credit to the Credit Agreement Borrowers under the Credit Agreement and it was a
condition precedent to the obligation of the initial purchasers to purchase the Notes that the
Grantors shall have executed and delivered, with respect to the Credit Agreement, this Agreement,
and the Notes, the Original Guarantee and Collateral Agreement to the Collateral Trustee for the
benefit of the applicable Secured Parties; and

          WHEREAS, the Credit Agreement Borrowers and the other Grantors have entered into the
Collateral Trust Agreement which sets forth the terms on which each Secured Party has appointed the
Collateral Trustee as trustee for the present and future holders of the Secured Obligations (as
hereinafter defined) to receive, hold, maintain, administer and distribute the Collateral at any
time delivered to the Collateral Trustee and to enforce the Security Documents, including this
Agreement, and all interests, rights, powers and remedies of the Collateral Trustee in respect
thereto or thereunder and the proceeds thereof;

          NOW, THEREFORE, in consideration of the premises and to induce the Secured Parties to enter
into the Secured Debt Documents and to induce such Secured Parties to make their respective
extensions of credit to the applicable Grantors thereunder, each Grantor hereby agrees with the
Collateral Trustee, for the benefit of the applicable Secured Parties, as follows:

SECTION 1. DEFINED TERMS

          1.1. Definitions. (a) Unless otherwise defined herein, terms defined in the
Collateral Trust Agreement and used herein shall have the meanings given to them in the Collateral
Trust Agreement, and the following terms are used herein as defined in the New York UCC (and if
defined in more than one Article of the New York UCC shall have the meanings given in Article 9
thereof): Accounts, Account Debtor, Certificated Security, Chattel Paper, Commercial Tort Claim,
Commodity Account, Commodity Contract, Commodity Intermediary, Documents, Electronic Chattel Paper,
Equipment, Farm Products, Financial Asset, Fixtures, General Intangibles, Goods, Instruments,
Inventory, Letter of Credit, Letter of Credit Rights, Money, Payment Intangibles, Securities
Account, Securities Intermediary, Security, Security Entitlement, Supporting Obligations, Tangible
Chattel Paper and Uncertificated Security.

          (b) The following terms shall have the following meanings:

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

2

 

     “After-Acquired Intellectual Property” shall have the meaning assigned to such
term in Section 5.11(k).

     “Agreement” shall mean this Guarantee and Collateral Agreement, as the same may
be amended, supplemented, replaced or otherwise modified from time to time.

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

     “Borrower” shall mean (i) in the case of the Revolving Loans, Revolving Credit
Commitments and Revolving Letters of Credit (each as defined in the Credit Agreement) and
all related obligations under the Credit Agreement, the Credit Agreement Borrowers, (ii) in
the case of the Term Loans, Credit-Linked Deposits, Term Loan Commitments and Funded Letters
of Credit (as defined in the Credit Agreement) and all related obligations under the Credit
Agreement, the Company, (iii) in the case of the Notes issued under the Indenture and all
related obligations under the Indenture, the Company and (iv) in the case of the obligations
in respect of any future Series of Guaranteed Secured Debt, the Company and any other
applicable Grantor who shall act as the borrower or issuer under the applicable Secured Debt
Documents with respect to such Series of Guaranteed Secured Debt.

     “Borrower Obligations” shall mean, without duplication, the collective
reference to the unpaid principal of and interest on the loans (or other extensions of
credit), notes (or other debt securities), credit-linked deposits (or other similar

deposits) and all other obligations and liabilities of any Borrower in each case with
respect to any Series of Guaranteed Secured Debt (including interest accruing at the then
applicable rate provided in any applicable Secured Debt Document after the maturity of such
loans (or other extensions of credit), notes (or other debt securities) or credit-linked
deposits (or other similar deposits) and interest accruing at the then applicable rate
provided in any applicable Secured Debt Document after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like proceeding,
relating to the applicable Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) to any applicable Secured Party (including, in the
case of any Specified Hedging Agreement, any Lender, the Administrative Agent, the
Collateral Agent, any Arranger or the Syndication Agent or, in each case, any Affiliate
thereof, regardless of whether or not such Lender thereafter continues to be a Lender or
such Person continues to have such capacity with respect to the Credit Agreement), whether
direct or indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with this Agreement, the
Credit Agreement (if applicable), the Indenture (or the Notes) (if applicable) or any other
applicable Secured Debt Documents (including any letters of credit, any Specified Hedging
Agreement or any other document made, delivered or given in connection with any of the
foregoing), in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including all
fees and disbursements of counsel to the Secured Parties that are required to be paid
by the applicable Borrower pursuant to the terms of any of the foregoing agreements).

3

 

     “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.

          “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.

     “ Closing Date” shall mean December 23, 2003.

     “Collateral” shall mean have the meaning assigned to such term in Section 3.

     “Collateral Account” shall mean any collateral account established by the
Collateral Trustee as provided in Section 6.1 or 6.6.

     “Collateral Account Funds” shall mean, collectively, the following from time to
time on deposit in a Collateral Account: all funds (including all trust monies),
investments (including all cash equivalents) credited to, or purchased with funds from, any
Collateral Account and all certificates and instruments from time to time representing or
evidencing such investments; all notes, certificates of deposit, checks and other
instruments from time to time hereafter delivered to or otherwise possessed by the
Collateral Trustee for or on behalf of any Grantor in substitution for, or in addition to,
any or all of the Collateral; and all interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the items constituting Collateral.

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

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

     “Contracts” shall mean all contracts and agreements (in each case, whether
written or oral, or third party or intercompany) between any Grantor and other Person, as
the same may be amended, assigned, extended, restated, supplemented, replaced or otherwise
modified from time to time, including (i) all rights of any Grantor to receive moneys due
and to become due to it thereunder or in connection therewith, (ii) all rights of any
Grantor to receive proceeds of any insurance, indemnity, warranty or guaranty with respect
thereto, (iii) all rights of any Grantor to damages arising thereunder and (iv) all rights
of any Grantor to terminate, and to perform and compel performance of, such Contracts and to
exercise all remedies thereunder.

     “control” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise, and the terms
“controlling” and

4

 

“controlled” shall have meanings correlative thereto;
provided that when used in connection with the Collateral Trustee’s rights with
respect to, or security interest in, any Collateral, “control” shall have the meaning
specified in the UCC with respect to that type of Collateral.

     “Control Agreement (Deposit and Securities Accounts)” shall mean a Control
Agreement in the form of Exhibit A, to be executed and delivered by the applicable Grantor
and the other party or parties thereto with respect to each Deposit Account or Securities
Account of such Grantor except to the extent that the same constitutes an Excluded
Perfection Asset at any time.

     “Control Agreement (Commodities Contracts)” shall mean a Control Agreement in
the form of Exhibit B, to be executed and delivered by the applicable Grantor and the other
party or parties thereto with respect to each Commodity Contract of such Grantor as required
by Section 5.2(e).

     “Copyright Licenses” shall mean any agreement, whether written or oral, naming
any Grantor as licensor or licensee (including those listed in Schedule 4.11 (as such

schedule may be amended or supplemented from time to time)), granting any right in, to or
under any Copyright, including the grant of rights to manufacture, distribute, exploit and
sell materials derived from any Copyright.

     “ Copyrights” shall mean (i) all copyrights arising under the laws of
the United States, any other country, or union of countries, or any political subdivision of
any of the foregoing, whether registered or unregistered and whether published or
unpublished (including those listed in Schedule 4.11 (as such schedule may be amended or
supplemented from time to time)), all registrations and recordings thereof, and all
applications in connection therewith and rights corresponding thereto throughout the world,
including all registrations, recordings and applications in the United States Copyright
Office, (ii) the right to, and to obtain, all extensions and renewals thereof, and the right
to sue for past, present and future infringements of any of the foregoing, (iii) all
proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages,
and proceeds of suit and (v) all other rights of any kind whatsoever accruing thereunder or
pertaining thereto.

     “ Core Collateral” shall mean all Equity Interests in, and property
and assets of, NRG Mid-Atlantic, NRG Northeast and NRG South Central and their respective
subsidiaries (other than NRG Sterlington Power LLC, Bayou Cove Peaking Power LLC and Big
Cajun I Peaking Power LLC for so long as such entities shall constitute Excluded Project
Subsidiaries), whether now owned or hereafter acquired.

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

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

5

 

     “Credit Agreement Guarantors” shall mean the Revolving Loan Guarantors and the
Term Loan Guarantors.

     “Deposit Account” shall mean (i) all “deposit accounts” as defined in Article 9
of the New York UCC, (ii) all other accounts maintained with any financial institution
(other than Securities Accounts or Commodity Accounts) and (iii) shall include all of the
accounts listed on Schedule 4.8(c) under the heading “Deposit Accounts” (as such schedule
may be amended or supplemented from time to time) together, in each case, with all funds
held therein and all certificates or instruments representing any of the foregoing.

     “Depositary Bank” shall mean a financial institution that has delivered to the
Collateral Trustee an executed Control Agreement (Deposit and Securities Accounts).

     “ 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.

     “dollars” or “$” shall mean lawful money of the United States of
America.

     “Equity Interests” shall mean Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is convertible into,
or exchangeable for, Capital Stock).

     “Excluded Assets” shall mean (i) any lease, license, contract, property right
or agreement to which any Grantor is a party or any of such Grantor’s rights or interests
thereunder if and only for so long as the grant of a security interest therein under the
Security Documents shall constitute or result in a breach, termination or default or
invalidity under any such lease, license, contract, property right or agreement (other than
to the extent that any such term would be rendered ineffective pursuant to Sections 9-406,
9-407, 9-408 or 9-409 of the UCC of any relevant jurisdiction or any other applicable law or
principles of equity); provided that such lease, license, contract, property right
or agreement shall be an Excluded Asset only to the extent and for so long as the
consequences specified above shall result and shall cease to be an Excluded Asset and shall
become subject to the security interest granted under the Security Documents, immediately
and automatically, at such time as such consequences shall no longer result; (ii) any
interests in real property owned or leased by any Grantor only for so long as such interest
represents an Excluded Perfection Asset; (iii) any Equity Interests in any Excluded Project
Subsidiary the pledge of which pursuant to the Security Documents would constitute a default
under the applicable Non-Recourse Indebtedness in respect of which it is an obligor and any
voting Equity Interests in excess of 66% (or, in the case of NRG International Holdings
GmbH, NRG International Holdings (No.2) GmbH and NRGenerating International BV, 65%) of the
total outstanding voting Equity Interests in any Excluded Foreign Subsidiary; (iv) any
Deposit Account, Securities Account or
Commodities Account (and all cash, cash equivalents permitted by the terms of the
Secured Debt Documents and Commodity Contracts held therein) if and only for so long as such
Deposit Account, Securities Account or Commodities Account is subject to a

6

 

Lien under clause
(r) of the definition of “Permitted Liens” set forth in the Credit Agreement and the other
parallel exceptions provided for in the Secured Debt Documents; (v) the Equity Interests in,
and all properties and assets of, NRG Energy Insurance Ltd. (Cayman Islands); (vi) the
Equity Interests in, and all properties and assets of, NRGenerating III (Gibraltar),
NRGenerating IV Gibraltar, NRG Pacific Corporate Services Pty Ltd., Coniti Holding BV (only
for so long as such entity shall own no assets other than the Equity Interests in Tosli
(Gibraltar) BV) and Tosli (Gibraltar) BV (only for so long as such entity shall own no
assets); (vii) the Equity Interests in, and all properties and assets of, NRG Latin America
Inc., Sterling Luxembourg (No. 4) S.a.r.l, NRGenerating Luxembourg (No. 6) and S.a.r.l.,
NRGenerating Holdings (No. 21) BV (only for so long as such entity shall own no assets other
than the stock of its subsidiaries owned on the Closing Date); (viii) any Equity Interest of
a Person (other than a Subsidiary) held by any Grantor if and for so long as the pledge
thereof under the Security Documents shall constitute or result in a breach, termination or
default under any joint venture, stockholder or partnership agreement between such Grantor
and one or more other holders of Equity Interests of such Person; provided that (A)
such Grantor shall have used reasonable efforts to obtain the consent or waiver of such
other holders of Equity Interests of such Person to such a pledge and such consent or waiver
shall not have been obtained and (B) such Equity Interest shall be an Excluded Asset only to
the extent and for so long as the consequences specified above shall result and shall cease
to be an Excluded Asset and shall become subject to the security interest granted under the
Security Documents, immediately and automatically, at such time as such consequences shall
no longer result; (ix) all properties and assets of the Company’s resource recovery facility
located at North Newport, MN and all properties and assets of the Company’s resource
recovery facility located at Elk River, MN if and for so long as the grant of a security
interest therein under the Security Documents shall constitute or result in a breach,
termination or default under any service agreement with the applicable municipalities in
which such facilities reside; provided that (A) the Company shall have used
reasonable efforts to obtain the consent or waiver of such municipalities to the grant of
such security interests and such consent or waiver shall not have been obtained and (B) such
properties and assets shall be an Excluded Asset only to the extent and for so long as the
consequences specified above shall result and shall cease to be an Excluded Asset and shall
become subject to the security interest granted under the Security Documents, immediately
and automatically, at such time as such consequences shall no longer result; (x) any Account
of NRG Power Marketing solely to the extent that (x) such Account relates to the sale by NRG
Power Marketing of power or capacity that was purchased by NRG Power Marketing from a
Subsidiary that is an Excluded Project Subsidiary and (y) the grant of a security interest
in such Account under the Security Documents shall constitute or result in a breach,
termination or default under any agreement or instrument governing the applicable Existing
Non-Recourse Indebtedness of such Subsidiary (as such agreement or instrument was in effect
on the Closing Date); (xi) the Equity Interests in either of the NEO Companies to the extent
that a grant of a security interest in such Equity Interests under the Security Documents
shall constitute or result in a breach,
termination or default under any agreement or instrument governing the applicable
Existing Non-Recourse Indebtedness of their subsidiaries (as such agreement or instrument
was in effect on the Closing Date); and (xii) the Deposit Account established

7

 

by the Company
pursuant to the NRG Plan in respect of the Consolidated Edison dispute and all cash held
therein not to exceed (x) $11,700,000 as of the Closing Date plus (y) any amounts required
by the NRG Plan to be deposited therein in respect of invoices owing to Consolidated Edison;
provided that such Deposit Account (and all cash therein) shall automatically cease
to be an Excluded Asset from and after the date that such dispute is resolved.

     “Excluded Foreign Subsidiaries” shall mean, at any time, any Foreign Subsidiary
that is (or is treated as) for United States federal income tax purposes either (a) a
corporation or (b) a pass-through entity owned directly or indirectly by another Foreign
Subsidiary that is (or is treated as) a corporation; provided that (i) none of NRG
Mid-Atlantic, NRG Northeast or NRG South Central or any of their respective subsidiaries may
at any time be an Excluded Foreign Subsidiary and (ii) notwithstanding the foregoing, the
following entities will be deemed to be “Excluded Foreign Subsidiaries”: Sterling
Luxembourg (No. 4) S.a.r.l., Tosli Acquisition BV, NRGenerating Luxembourg (No. 6) S.a.r.l.,
NRGenerating Holdings (No. 4) GmbH (only for so long as such entity shall remain a direct
subsidiary of NRG International LLC and shall have no assets other than those owned on the
Closing Date), NRGenerating Holdings (No. 3) Gibraltar, NRGenerating Holdings (No. 23) BV,
NRG Pacific Corporate Services Pty Ltd., NRGenerating III (Gibraltar), NRGenerating IV
(Gibraltar), Coniti Holding BV (only for so long as such entity shall own no assets other
than the Equity Interests in Tosli (Gibraltar) BV) and Tosli (Gibraltar) BV (only for so
long as such entity shall own no assets). The Excluded Foreign Subsidiaries on the
Restatement Date are set forth on Schedule 1.1(a).

     “Excluded Foreign Subsidiary Voting Stock” shall mean the voting Equity
Interests in any Excluded Foreign Subsidiary.

     “Excluded Neo Companies” shall mean any of the Neo Companies to the extent that
the guarantee of the Note Borrower Obligations by such company would constitute or result in
a breach, termination or default under any agreement or instrument governing the applicable
Existing Non-Recourse Indebtedness of such Neo Company (as such agreement or instrument is
in effect on the Closing Date); provided that such company shall cease to be an
Excluded Neo Company and shall automatically be subject to the guarantee in Section 2 to the
extent that such guarantee shall not constitute or result in such a breach, termination or
default.

     “Excluded Perfection Assets” shall mean any property or assets (other than any
Core Collateral except (a) the lease of Dunkirk Power LLC relating to 347 Seneca Street,
Buffalo, NY, (b) the lease of Astoria Gas Turbine Power LLC relating to the Consolidated
Edison site located at 31-02 20th Avenue, Astoria, NY, (c) the lease of Astoria Gas Turbine
Power LLC relating to the A-11 dock located at 31-02 20th Avenue, Astoria, NY, (d) the lease
of NRG New Roads Holding LLC relating to the turbine storage facilities located at GTS
Duratek, 1790 Dock Street, Memphis, TN, (e) the lease
of NRG New Roads Holding LLC relating to the turbine storage facilities located at
Liebherr American Inc., 4100 Chestnut, Newport News, VA and (f) the lease of NRG New Roads
Holding LLC relating to the warehouse facilities for turbine storage located

8

 

at Tidewater
Warehouses, Bay 3, 814 Childs Avenue, Hampton, VA) 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; provided that such property or assets shall not have a fair market value
at any time exceeding $2,000,000 (or, if such property or asset is a Deposit Account or
Securities Account, $250,000) individually or $20,000,000 in the aggregate and, to the
extent that the fair market value of any such property or asset shall exceed $2,000,000 (or,
if such property or asset is a Deposit Account or Securities Account, $250,000)
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 $20,000,000 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.

     “Excluded Project Subsidiaries” shall mean, at any time, (a) any Subsidiary
existing as of the Restatement Date that is an obligor with respect to Existing Non-Recourse
Indebtedness outstanding at such time and (b) any Subsidiary that is set forth on Schedule
1.1(b) as of the Restatement Date (so long as such Subsidiary does not become (and remain
for a period of 365 days or more) a Guarantor after the Restatement Date) or any Subsidiary
that becomes a Subsidiary after the Restatement Date that is an obligor with respect to
Additional Non-Recourse Indebtedness outstanding at such time, in each case if and for so
long as the grant of a security interest in the property or assets of such Subsidiary or the
pledge of the Equity Interests of such Subsidiary, in each case in favor of the Collateral
Trustee for the benefit of the Secured Parties, shall constitute or result in a breach,
termination or default under the agreement or instrument governing the applicable
Non-Recourse Indebtedness; provided that such Subsidiary shall be an Excluded
Project Subsidiary only to the extent that and for so long as the requirements and
consequences above shall exist; provided further that none of NRG
Mid-Atlantic, NRG Northeast or NRG South Central or any of their respective subsidiaries
(other than NRG Sterlington Power LLC, Bayou Cove Peaking Power LLC and Big Cajun I Peaking
Power LLC for so long as such entities shall constitute Excluded Project Subsidiaries) may
at any time be an Excluded Project Subsidiary. The Excluded Project Subsidiaries on the
Restatement Date are set forth on Schedule 1.1(b).

     “Excluded Project Subsidiary Stock” shall mean the Equity Interests in any
Excluded Project Subsidiary.

     “Existing Non-Recourse Indebtedness” shall mean secured indebtedness for
borrowed money outstanding as of the Closing Date of a Subsidiary (or of Cadillac Renewable
Energy LLC) existing as of the Closing Date and any refinancing indebtedness in respect of
such indebtedness that is permitted by each of the Secured Debt Documents that was incurred
to finance the development, construction or acquisition of or by, or repairs, improvements
or additions to, fixed or capital assets of such Subsidiary (including power generation
facilities); provided that, except as set forth
on Schedule 1.01(d) to the Credit Agreement, (a) such indebtedness is without recourse
to the Company or any other Subsidiary or to any property or assets of the Company or any
other Subsidiary (other than, in each such case, another Subsidiary (x) which is the

9

 

direct
parent or a direct or indirect Subsidiary of the Subsidiary that incurred or issued such
indebtedness (other than any such indebtedness constituting a guarantee) or (y) that is a
Subsidiary that itself has Non-Recourse Indebtedness (as defined in the Credit Agreement)
(other than any 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 (as
defined in the Credit Agreement) (other than any such indebtedness constituting a
guarantee)), (b) neither the Company nor any other Subsidiary (other than another Subsidiary
(x) which is the direct parent or a direct or indirect Subsidiary of the Subsidiary that
incurred or issued such indebtedness (other than any such indebtedness constituting a
guarantee) or (y) that is a Subsidiary that itself has Non-Recourse Indebtedness (as defined
in the Credit Agreement) (other than any 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 (as defined in the Credit Agreement) (other than any 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 Credit Agreement to support obligations of such applicable
subsidiary and (ii) any investments in such applicable subsidiary made in accordance with
each of the Secured Debt Documents), (c) neither the Company nor any other Subsidiary or
Affiliate of any thereof constitutes the lender of such indebtedness, (d) 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 that is not a Credit Agreement
Guarantor) would permit upon notice, lapse of time or both any holder of any other
Indebtedness of the Company or any Credit Agreement Guarantor (other than indebtedness
permitted pursuant to Section 6.01(b)(i), (ii), (iii) or (xi) of the Credit 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 and (e) the Liens securing such
indebtedness shall exist only on (i) the property and assets of any Subsidiary that is not a
Credit Agreement Guarantor and (ii) the Equity Interests in any Subsidiary that is not a
Credit Agreement Guarantor (and shall not apply to any other property or assets of the
Company or any other Subsidiary that is a Credit Agreement Guarantor), except, in the case
of each of clauses (a) and (b) for (x) agreements of the Company or any other Subsidiary to
provide corporate or management services or operation and maintenance services to such
Subsidiary, (y) guarantees of the Company or any other Subsidiary 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 to make capital contributions
to such Subsidiary, in the case of each
of clauses (x), (y) and (z), which are otherwise permitted under each of the Secured
Debt Documents.

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

10

 

     “Future Debt Borrower Obligations” shall mean the Borrower Obligations of the
applicable Borrower under, and in respect of, the applicable Secured Debt Documents
governing such future Series of Guaranteed Secured Debt.

     “Future Debt Guarantors” shall mean the collective reference to each Subsidiary
that is or becomes a party hereto as provided herein, except to the extent that any such
Subsidiary is not required to guarantee the Future Debt Borrower Obligations under such
future Series of Guaranteed Secured Debt pursuant to the terms of the Secured Debt Documents
that govern such Series of Guaranteed Secured Debt.

     “Good Utility Practices” shall mean any of those practices, methods, standards
and acts (including the practices, methods, standards and acts engaged in or approved by a
significant portion of the electric power generation industry in the United States) that, at
a particular time, in the exercise of reasonable judgment in light of the facts known or
that should have reasonably been expected to have been known at the time a decision was
made, could have reasonably been expected to accomplish the desired result consistent with
good business practices, reliability, economy, safety and expedition, and which practices,
methods, standards and acts conform in all material respects to applicable law, permits and
other governmental approvals.

     “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 or pertaining to government.

     “Grantors” shall mean (i) in the case of the Secured Obligations under, or in
respect of, the Credit Agreement, any Specified Hedging Agreement permitted thereunder and
the other Secured Debt Documents relating thereto, the Company and the Credit Agreement
Guarantors, (ii) in the case of the Secured Obligations under, or in respect of, the
Indenture and the Notes and the other Secured Debt Documents relating thereto, the Company
and the Note Guarantors and (iii) in the case of the Secured Obligations under, or in
respect of, the Secured Debt Documents governing any future Series of Guaranteed Secured
Debt, the Company and the applicable Future Debt Guarantors.

     “Guaranteed Secured Debt Representative” shall mean each Secured Debt
Representative with respect to each Series of Guaranteed Secured Debt.

     “Guaranteed Secured Parties” shall mean any Secured Party who is holding a
Secured Obligation with respect to a Series of Guaranteed Secured Debt (including any
Guaranteed Secured Debt Representative and the Collateral Trustee), at any time.

     “Guarantor Obligations” shall mean with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in connection with
this Agreement (including Section 2) or any other Secured Debt Document to which such
Guarantor is a party, in each case whether on account of guarantee obligations,

11

 

reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including all
fees and disbursements of counsel to any Secured Party that are required to be paid by such
Guarantor pursuant to the terms of this Agreement or any other Secured Debt Document).

     “Guarantors” shall mean, as applicable, the Future Debt Guarantors, the Note

Guarantors, the Revolving Loan Guarantors and the Term Loan Guarantors.

     “Immaterial Subsidiary” shall mean, at any time, any Restricted Subsidiary that
is designated by the Company as an “Immaterial Subsidiary” if and for so long as such
Restricted Subsidiary, together with all other Immaterial Subsidiaries, has (a) total assets
at such time not exceeding 5% of the Company’s consolidated assets as of the most recent
fiscal quarter for which balance sheet information is available and (b) total revenues and
operating income for the most recent 12-month period for which income statement information
is available not exceeding 5% of the Company’s consolidated revenues and operating income,
respectively; provided that (i) such Restricted Subsidiary shall be an Immaterial
Subsidiary only to the extent that and for so long as all of the above requirements are
satisfied and (ii) none of NRG Mid-Atlantic or its subsidiaries, NRG Northeast or its
subsidiaries or NRG South Central or its subsidiaries may at any time be an Immaterial
Subsidiary hereunder. The Immaterial Subsidiaries on the Restatement Date are set forth on
Schedule 1.1(c).

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

     “Intellectual Property” shall mean the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including the Copyrights, the Copyright
Licenses, the Patents, the Patent Licenses, the Trademarks, the Trademark Licenses, the
Trade Secrets and the Trade Secret Licenses, and all rights to sue at law or in equity for
any infringement or other impairment thereof, including the right to receive all proceeds
and damages therefrom.

     “Intercompany Note” shall mean any promissory note evidencing loans made by any
Grantor to the Company or any of the Subsidiaries.

     “Insurance” shall mean (i) all insurance policies covering any or all of the
Collateral (regardless of whether the Collateral Trustee is the loss payee thereof) and (ii)
any key man life insurance policies.

     “Investment Property” shall mean the collective reference to (i) all
“investment property” as such term is defined in Section 9-102(a)(49) of the New York UCC
(other than any Excluded Foreign Subsidiary Voting Stock and any Excluded Project Subsidiary
Stock, in each case excluded from the definition of “Pledged Equity Interests”) including
all Certificated Securities and Uncertificated Securities, all Security Entitlements,
all Securities Accounts, all Commodity Contracts and all Commodity Accounts, (ii) security
entitlements, in the case of any United States Treasury book-entry securities, as defined in
31 C.F.R. section 357.2, or, in the case of any United States federal agency book-entry

12

 

securities, as defined in the corresponding United States federal regulations governing such
book-entry securities and (iii) whether or not otherwise constituting “investment property”,
all Pledged Notes, all Pledged Equity Interests, all Pledged Security Entitlements and all
Pledged Commodity Contracts.

     “Issuers” shall mean the collective reference to each issuer of a Pledged
Security.

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

     “Licensed Intellectual Property” shall have the meaning assigned to such term
in Section 4.11.

     “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,
liabilities or prospects of the Company and the Subsidiaries, taken as a whole, or (b) the
validity or enforceability of any of the Secured Debt Documents or the rights and remedies
of the Collateral Trustee or any of the other Secured Parties thereunder.

     “ Material Contract” shall mean any agreement, contract or license or
other arrangement (other than an agreement, contract or arrangement representing
indebtedness for borrowed money) to which any Grantor is a party that is material to the
Grantors and their subsidiaries, taken as a whole, and for which breach, nonperformance,
cancellation or failure to renew could reasonably be expected to have a Material Adverse
Effect.

     “Material Intellectual Property” shall have the meaning assigned to such term
in Section 4.11.

     “Neo Companies” shall mean NEO Hackensack, LLC and NEO Prima Deshecha LLC.

     “New York UCC” shall mean the Uniform Commercial Code as from time to time in
effect in the State of New York.

     “Non-Assignable Contract” shall mean any Contract that by its terms purports to
restrict or prevent the assignment thereof or granting of a security interest therein
(either by its terms or by any federal or state statutory prohibition or otherwise,
irrespective of whether such prohibition or restriction is enforceable under Sections 9-407
through 409 of the New York UCC).

     “Note Borrower Obligations” shall mean the Borrower Obligations of the Company
under, or in respect of, the Notes and the Indenture, any Specified Hedging Agreements
permitted thereunder and each other Secured Debt Document relating thereto or in respect
thereof.

     “Note Guarantors” shall mean the collective reference to each Subsidiary (other
than the Immaterial Subsidiaries and the Excluded Neo Companies) that is or becomes a party
hereto as provided herein.

13

 

     “Notes” shall have the meaning assigned to such term in the recitals.

     “NRG Mid-Atlantic” shall mean NRG Mid-Atlantic Generating LLC, a Delaware
limited liability company that is a wholly owned Subsidiary.

     “NRG Northeast” shall mean NRG Northeast Generating LLC, a Delaware limited
liability company that is a wholly owned Subsidiary.

     “NRG Power Marketing” shall have the meaning assigned to such term in the
preamble.

     “NRG South Central” shall mean NRG South Central Generating LLC, a Delaware
limited liability company that is a wholly owned Subsidiary.

          “Original Credit Agreement” shall mean the Credit Agreement, including all amendments
thereto and waivers thereof effective prior to the Restatement Date.

          “Original Guarantee and Collateral Agreement” shall mean this Agreement as in effect
immediately prior to the Restatement Date.

     “Owned Intellectual Property” shall have the meaning assigned to such term in Section
4.11.

     “Patent License” shall mean all agreements, whether written or oral, providing
for the grant by or to any Grantor of any right to manufacture, use or sell any invention
covered in whole or in part by a Patent, including any of the foregoing listed in Schedule
4.11 (as such schedule may be amended or supplemented from time to time).

     “Patents” shall mean (i) all letters patent of the United States, any other
country, union of countries or any political subdivision of any of the foregoing, all
reissues and extensions thereof and all goodwill associated therewith, including any of the
foregoing listed in Schedule 4.11 (as such schedule may be amended or supplemented from time
to time), (ii) all applications for letters patent of the United States or any other country
or union of countries or any political subdivision of any of the foregoing and all
divisions, continuations and continuations-in-part thereof, including any of the foregoing
listed in Schedule 4.11 (as such schedule may be amended or supplemented from time to time),
(iii) all rights to, and to obtain, any reissues or extensions of the foregoing and (iv) all
proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages
and proceeds of suit.

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

     “Pledged Accounts” shall have the meaning assigned to such term in Section
5.13.

     “Pledged Alternative Equity Interests” shall mean all interests of any Grantor
in participation or other interests in any equity or profits of any business entity and the

14

 

certificates, if any, representing such interests and all dividends, distributions, cash,
warrants, rights, options, instruments, securities and other property or proceeds from time
to time received, receivable or otherwise distributed in respect of or in exchange for any
or all of such interests and any other warrant, right or option to acquire any of the
foregoing; provided, however, that Pledged Alternative Equity Interests
shall not include any Pledged Stock, Pledged Partnership Interests, Pledged LLC Interests or
Pledged Trust Interests.

     “Pledged Commodity Contracts” shall mean all commodity contracts listed on
Schedule 4.8(c) (as such schedule may be amended or supplemented from time to time) and all
other commodity contracts to which any Grantor is party from time to time.

     “Pledged Debt Securities” shall mean all debt securities now owned or hereafter
acquired by any Grantor, including the debt securities listed on Schedule 4.8(b) (as such
schedule may be amended or supplemented from time to time), together with any other
certificates, options, rights or security entitlements of any nature whatsoever in respect
of the debt securities of any Person that may be issued or granted to, or held by, any
Grantor while this Agreement is in effect.

     “Pledged Equity Interests” shall mean all Pledged Stock, Pledged LLC Interests,
Pledged Partnership Interests, Pledged Trust Interests and Pledged Alternative Equity
Interests.

     “Pledged LLC Interests” shall mean all interests of any Grantor now owned or
hereafter acquired in any limited liability company (other than those interests described in
clauses (iii), (v), (vi), (vii), (viii) and (ix) of the definition of “Excluded Assets”),
including all limited liability company interests listed on Schedule 4.8(a) under the
heading “Pledged LLC Interests” (as such schedule may be amended or supplemented from time
to time) and the certificates, if any, representing such limited liability company interests
and any interest of such Grantor on the books and records of such limited liability company
and all dividends, distributions, cash, warrants, rights, options, instruments, securities
and other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such limited liability company
interests and any other warrant, right or option to acquire any of the foregoing.

     “Pledged NEO Notes” shall mean the promissory notes listed under subsection VI
of Schedule 4.8(b) hereto as in effect on the Closing Date.

     “Pledged Notes” shall mean all promissory notes now owned or hereafter acquired
by any Grantor including those listed on Schedule 4.8(b) (as such schedule may be amended or
supplemented from time to time) and all Intercompany Notes at any time issued to or held by
any Grantor (other than promissory notes in an aggregate principal
amount not to exceed $250,000 at any time outstanding issued in connection with
extensions of trade credit by any Grantor in the ordinary course of business).

15

 

     “Pledged Partnership Interests” shall mean all interests of any Grantor now
owned or hereafter acquired in any general partnership, limited partnership, limited
liability partnership or other partnership (other than those interests described in clauses
(iii), (v), (vi), (vii), (viii) and (ix) of the definition of “Excluded Assets”), including
all partnership interests listed on Schedule 4.8(a) under the heading “Pledged Partnership
Interests” (as such schedule may be amended or supplemented from time to time) and the
certificates, if any, representing such partnership interests and any interest of such
Grantor on the books and records of such partnership and all dividends, distributions, cash,
warrants, rights, options, instruments, securities and other property or proceeds from time
to time received, receivable or otherwise distributed in respect of or in exchange for any
or all of such partnership interests and any other warrant, right or option to acquire any
of the foregoing.

     “Pledged Securities” shall mean the collective reference to the Pledged Debt
Securities, the Pledged Notes and the Pledged Equity Interests.

     “Pledged Security Entitlements” shall mean all security entitlements with
respect to the financial assets listed on Schedule 4.8(c) (as such schedule may be amended
or supplemented from time to time) and all other security entitlements of any Grantor.

     “Pledged Stock” shall mean all shares of capital stock now owned or hereafter
acquired by any Grantor (other than those shares of capital stock described in clauses
(iii), (v), (vi), (vii), (viii) and (ix) of the definition of “Excluded Assets”), including
all shares of capital stock listed on Schedule 4.8(a) under the heading “Pledged Stock” (as
such schedule may be amended or supplemented from time to time) and the certificates, if
any, representing such shares and any interest of such Grantor in the entries on the books
of the issuer of such shares and all dividends, distributions, cash, warrants, rights,
options, instruments, securities and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all of such
shares and any other warrant, right or option to acquire any of the foregoing;
provided, however, that in no event shall more than 66% of the total
outstanding Excluded Foreign Subsidiary Voting Stock or any Excluded Project Subsidiary
Stock be required to be pledged hereunder.

     “Pledged Trust Interests” shall mean all interests of any Grantor now owned or
hereafter acquired in a Delaware business trust or other trust (other than those interests
described in clauses (iii), (v), (vi), (vii), (viii) and (ix) of the definition of “Excluded
Assets”), including all trust interests listed on Schedule 4.8(a) under the heading “Pledged
Trust Interests” (as such schedule may be amended or supplemented from time to time) and the
certificates, if any, representing such trust interests and any interest of such Grantor on
the books and records of such trust or on the books and records of any securities
intermediary pertaining to such interest and all dividends, distributions, cash, warrants,
rights, options, instruments, securities and other property or proceeds from time to time
received, receivable or otherwise distributed in respect of or in exchange for any
or all of such trust interests and any other warrant, right or option to acquire any of
the foregoing.

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     “Proceeds” shall mean all “proceeds” as such term is defined in Section
9-102(a)(64) of the New York UCC and, in any event, shall include all dividends or other
income from the Investment Property, collections thereon or distributions or payments with
respect thereto.

     “Receivable” shall mean all Accounts and any other any right to payment for
goods or other property sold, leased, licensed or otherwise disposed of or for services
rendered, whether or not such right is evidenced by an Instrument or Chattel Paper or
classified as a Payment Intangible and whether or not it has been earned by performance.
References herein to Receivables shall include any Supporting Obligation or collateral
securing such Receivable.

     “Requirement of Law” shall mean as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such Person and
any law, treaty, rule or regulation or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject, or which pertains to or
governs the legality, validity, perfection, performance or enforcement of the Secured Debt
Documents or the Liens thereunder.

     “Restatement Date” shall mean December 24, 2004.

     “Revolving Loan Borrower Obligations” shall mean the Borrower Obligations of
the Credit Agreement Borrowers under, or in respect of, the Credit Agreement, any Specified
Hedging Agreements permitted thereunder and each other Secured Debt Document relating
thereto, including in respect of the Revolving Loans, Revolving Credit Commitments and
Revolving Letters of Credit (each as defined in the Credit Agreement).

     “Revolving Loan Guarantors” shall mean the collective reference to each
Subsidiary (other than NRG Power Marketing) that is or becomes a party hereto as provided
herein.

     “Secured Obligations” shall mean (i) in the case of any Borrower, the
applicable Borrower Obligations and (ii) in the case of each Guarantor, the applicable
Borrower Obligations and its Guarantor Obligations.

     “Secured Parties” shall mean any Person who is holding a Secured Obligation
(including any Secured Debt Representative and the Collateral Trustee) at any time.

     “Securities Act” shall mean the Securities Act of 1933, as amended.

     “Series of Guaranteed Secured Debt” shall mean each Series of Secured Debt that
pursuant to the terms of the Secured Debt Documents governing such Series of Secured Debt is
guaranteed by the Guarantors pursuant to Section 2 hereof and shall include, in the case of
the Credit Agreement and any other Credit Facility the Indebtedness under
which constitutes Priority Lien Debt, any obligations in respect of Specified Hedging
Agreements that are permitted by the terms of the Priority Lien Documents relating to the

17

 

Credit Agreement or such other Credit Facilities to be secured equally and ratably with the
Priority Lien Obligations thereunder.

     “Specified Hedging Agreement” shall have the meaning assigned to such term in
the Credit Agreement.

     “Subsidiary” shall mean any subsidiary of the Company.

     “subsidiary” shall mean, with respect to any Person (herein referred to as the
“parent”), any corporation, partnership, limited liability company, association or
other entity (a) 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, or (b) that is, at the time any determination is made, otherwise controlled by the
parent or one or more subsidiaries of the parent or by the parent and one or more
subsidiaries of the parent.

     “Term Loan Borrower Obligations” shall mean the Borrower Obligations of the
Company under, or in respect of, the Credit Agreement, and Specified Hedging Agreements
permitted thereunder and each other Secured Debt Document relating thereto, including in
respect of the Term Loans, Credit-Linked Deposits, Term Loan Commitments and Funded Letters
of Credit (each as defined in the Credit Agreement).

     “Term Loan Guarantors” shall mean the collective reference to each Subsidiary
that is or becomes a party hereto as provided herein.

     “Trademark License” shall mean any agreement, whether written or oral,
providing for the grant by or to any Grantor of any right in, to or under any Trademark,
including any of the foregoing listed in Schedule 4.11 (as such schedule may be amended or
supplemented from time to time).

     “Trademarks” shall mean (i) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles, service marks, logos
and other source or business identifiers, and all goodwill associated therewith, now
existing or hereafter adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States Patent and Trademark
Office or in any similar office or agency of the United States, any State thereof or any
other country, union of countries, or any political subdivision of any of the foregoing, or
otherwise, and all common-law rights related thereto, including any of the foregoing listed
in Schedule 4.11 (as such schedule may be amended or supplemented from time to time), (ii)
the right to, and to obtain, all renewals thereof, (iii) the goodwill of the business
symbolized by the foregoing, (iv) other source or business identifiers, designs and general
intangibles of a like nature and (v) the right to sue for past, present and future
infringements or dilution of any of the foregoing or for any injury to goodwill, and all
proceeds of the foregoing, including royalties, income, payments, claims, damages and
proceeds of suit.

 
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     “Trade Secret License” shall mean any agreement, whether written or oral,
providing for the grant by or to any Grantor of any right in, to or under any Trade Secret,
including any of the foregoing listed in Schedule 4.11 (as such schedule may be amended or
supplemented from time to time).

     “Trade Secrets” shall mean all trade secrets and all other confidential or
proprietary information and know-how (all of the foregoing being collectively called a
“Trade Secret”), whether or not reduced to a writing or other tangible form,
including all documents and things embodying, incorporating, or describing such Trade
Secret, the right to sue for past, present and future infringements of any Trade Secret and
all proceeds of the foregoing, including royalties, income, payments, claims, damages and
proceeds of suit.

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

          1.2. Other Definitional Provisions. (a) The words “hereof”, “herein”, “hereto” and
“hereunder” and words of similar import when used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement, and Section and Schedule
references are to the specific provisions of this Agreement unless otherwise specified.

          (b) The meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

          (c) Where the context requires, terms relating to the Collateral or any part thereof, when
used in relation to a Grantor, shall refer to the property or assets such Grantor has granted as
Collateral or the relevant part thereof.

          (d) 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”.

          (e) All references to the Lenders herein shall, where appropriate, include any Lender, the
Administrative Agent, the Collateral Agent, any Arranger or the Syndication Agent or, in each case,
any Affiliate thereof that is party to a Specified Hedging Agreement.

SECTION 2. GUARANTEE

          2.1. Guarantee.

          (a) Each of the Revolving Loan Guarantors, jointly and severally, unconditionally and
irrevocably, affirms that it has guaranteed with respect to the Original Credit Agreement, and
hereby guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties
identified (and defined in) in the Credit Agreement and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by each Credit Agreement
Borrower when due (whether at the stated maturity, by acceleration or otherwise) of the Revolving
Loan Borrower Obligations. Each of the Term Loan Guarantors, jointly and severally,
unconditionally and irrevocably, affirms that it has guaranteed

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with respect to the Original Credit Agreement, and
hereby guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties
identified (and defined in) in the Credit Agreement and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by each Credit Agreement
Borrower when due (whether at the stated maturity, by acceleration or otherwise) of the Revolving
Loan Borrower Obligations. Each of the Term Loan Guarantors, jointly and severally,
unconditionally and irrevocably, affirms that it has guaranteed with respect to the Original Credit
Agreement, and hereby guarantees to the Administrative Agent, for the ratable benefit of the
Secured Parties identified (and defined in) in the Credit Agreement and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment and performance by
the Company when due (whether at the stated maturity, by acceleration or otherwise) of the Term
Loan Borrower Obligations. Each of the Note Guarantors, jointly and severally, unconditionally and
irrevocably, affirms that it has guaranteed with respect to the Notes, and hereby guarantees to the
Trustee, for the ratable benefit of each holder of Notes (and the Trustee) and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment and performance by
the Company when due (whether at the stated maturity, by acceleration or otherwise) of the Note
Borrower Obligations. Each of the Future Debt Guarantors hereby, jointly and severally,
unconditionally and irrevocably, guarantees to the applicable future Guaranteed Secured Debt
Representative, for the ratable benefit of the holders of the applicable obligations (and the
applicable future Guaranteed Secured Debt Representatives) thereunder and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment and performance by
the applicable Borrower when due (whether at the stated maturity, by acceleration or otherwise) of
the applicable Future Debt Borrower Obligations. Notwithstanding anything to the contrary
contained herein, the guarantee by any of the Neo Companies of the Revolving Loan Borrower
Obligations and the Term Loan Borrower Obligations and, if applicable, any Future Debt Borrower
Obligations shall be limited to the extent that such guarantee does not constitute or result in a
breach, termination or default under any agreement or instrument governing the applicable Existing
Non-Recourse Indebtedness of such Neo Company (as such agreement or instrument is in effect on the
Closing Date).

          (b) If and to the extent required in order for the Guarantor Obligations of any Guarantor to
be enforceable under applicable federal, state and other laws relating to the insolvency of
debtors, the maximum liability of such Guarantor hereunder shall be limited to the greatest amount
which can lawfully be guaranteed by such Guarantor under such laws, after giving effect to any
rights of contribution, reimbursement and subrogation arising under Section 2.2. Each Guarantor
acknowledges and agrees that, to the extent not prohibited by applicable law, (i) such Guarantor
(as opposed to its creditors, representatives of creditors or bankruptcy trustee, including such
Guarantor in its capacity as debtor in possession exercising any powers of a bankruptcy trustee)
has no personal right under such laws to reduce, or request any judicial
relief that has the effect of reducing, the amount of its liability under this Agreement, (ii)
such Guarantor (as opposed to its creditors, representatives of creditors or bankruptcy trustee,
including such Guarantor in its capacity as debtor in possession exercising any powers of a
bankruptcy trustee) has no personal right to enforce the limitation set forth in this Section
2.1(b) or to reduce, or request judicial relief reducing, the amount of its liability under this
Agreement and (iii) the limitation set forth in this Section 2.1(b) may be enforced only to the
extent required under such laws in order for the obligations of such Guarantor under this Agreement
to be enforceable under such laws and only by or for the benefit of a creditor, representative of
creditors or bankruptcy trustee of such Guarantor or other Person entitled, under such laws, to
enforce the provisions thereof.

          (c) Each Guarantor agrees that the applicable Borrower Obligations may at any time and from
time to time be incurred or permitted in an amount exceeding the maximum

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liability of such
Guarantor under Section 2.1(b) without impairing the guarantee contained in this Section 2 or
affecting the rights and remedies of any Secured Party hereunder.

          (d) The guarantee contained in this Section 2 shall remain in full force and effect until all
the Borrower Obligations and the obligations of each Guarantor under the guarantee contained in
this Section 2 shall have been satisfied by payment in full in cash (other than indemnification and
other contingent obligations not then due and payable), no letter of credit shall be outstanding
and all commitments to extend credit under any Secured Debt Documents shall have been terminated or
expired, notwithstanding that from time to time during the term of the Secured Debt Documents any
Borrower may be free from any or all of its Borrower Obligations.

          (e) No payment made by any applicable Borrower, any of the Guarantors, any other guarantor or
any other Person or received or collected by any Secured Party from any applicable Borrower, any of
the Guarantors, any other guarantor or any other Person by virtue of any action or proceeding or
any set-off or appropriation or application at any time or from time to time in reduction of or in
payment of the Borrower Obligations shall be deemed to modify, reduce, release or otherwise affect
the liability of any Guarantor hereunder which shall, notwithstanding any such payment (other than
any payment made by such Guarantor in respect of the Borrower Obligations or any payment received
or collected from such Guarantor in respect of the Borrower Obligations), remain liable for the
Borrower Obligations up to the maximum liability of such Guarantor hereunder until the Borrower
Obligations are paid in full (other than indemnification and other contingent obligations not then
due and payable), no letter of credit shall be outstanding and all commitments to extend credit
under any Secured Debt Documents shall have been terminated or expired.

          2.2. Rights of Reimbursement, Contribution and Subrogation. In case any payment is
made on account of the Secured Obligations by any Grantor or is received or collected on account of
the Secured Obligations from any Grantor or its property:

          (a) If such payment is made by the applicable Borrower or from its respective property, then,
if and to the extent such payment is made on account of Secured Obligations
arising from or relating to a loan or other extension of credit made to such Borrower or a
letter of credit issued for the account of such Borrower, such Borrower shall not be entitled (i)
to demand or enforce reimbursement or contribution in respect of such payment from any other
Grantor or (ii) to be subrogated to any claim, interest, right or remedy of any Secured Party
against any other Person, including any other Grantor or its property; and

          (b) If such payment is made by a Guarantor or from its property, such Guarantor shall be
entitled, subject to and upon payment in full of the Secured Obligations (other than
indemnification and other contingent obligations not then due and payable), (i) to demand and
enforce reimbursement for the full amount of such payment from the applicable Borrower and (ii) to
demand and enforce contribution in respect of such payment from each other applicable Guarantor
that has not paid its fair share of such payment, as necessary to ensure that (after giving effect
to any enforcement of reimbursement rights provided hereby) each applicable Guarantor pays its fair
share of the unreimbursed portion of such payment. For this purpose, the fair share of each
Guarantor as to any unreimbursed payment shall be determined based on an

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equitable apportionment of
such unreimbursed payment among all applicable Guarantors based on the relative value of their
assets and any other equitable considerations deemed appropriate by a court of competent
jurisdiction.

          (c) If and whenever (after payment in full of the Secured Obligations (other than
indemnification and other contingent obligations not then due and payable) and delivery of
notification thereof to the Collateral Trustee in accordance with Article 4 of the Collateral Trust
Agreement) any right of reimbursement or contribution becomes enforceable by any Grantor against
any other Grantor under Sections 2.2(a) or 2.2(b), such Grantor shall be entitled, subject to and
upon payment in full of the Secured Obligations (other than indemnification and other contingent
obligations not then due and payable), to be subrogated (equally and ratably with all other
Grantors entitled to reimbursement or contribution from any other Grantor as set forth in this
Section 2.2) to any security interest that may then be held by the Collateral Trustee upon any
Collateral granted to it in this Agreement. Such right of subrogation shall be enforceable solely
against the Grantors, and not against the Collateral Trustee or any other Secured Party, and
neither the Collateral Trustee nor any other Secured Party shall have any duty whatsoever to
warrant, ensure or protect any such right of subrogation or to obtain, perfect, maintain, hold,
enforce or retain any Collateral for any purpose related to any such right of subrogation. If
subrogation is demanded by any Grantor, then (after payment in full in cash of the Secured
Obligations and, if applicable, the termination of all commitments to extend credit thereunder, the
discharge or cash collateralization (at 100% of the aggregate undrawn amount) of all outstanding
letters of credit issued thereunder and the return of any Credit-Linked Deposit (or similar
deposit) made thereunder) the Collateral Trustee shall deliver to the Grantors making such demand,
or to a representative of such Grantors or of the Grantors generally, an instrument reasonably
satisfactory to the Collateral Trustee transferring, on a quitclaim basis without any recourse,
representation, warranty or obligation whatsoever, whatever security interest the Collateral
Trustee then may hold in whatever Collateral may then exist that was not previously released or
disposed of by the Collateral Trustee (provided that such Grantors shall prepare and
deliver the initial draft of such instrument to the Collateral Trustee).

          (d) All rights and claims arising under this Section 2.2 or based upon or relating to any
other right of reimbursement, indemnification, contribution or subrogation that
may at any time arise or exist in favor of any Grantor as to any payment on account of the
Secured Obligations made by it or received or collected from its property shall be fully
subordinated in all respects to the prior payment in full in cash of all of the Secured Obligations
(other than indemnification and other contingent obligations not then due and payable) and, if
applicable, the termination of all commitments to extend credit thereunder, the discharge or cash
collateralization (at 100% of the aggregate undrawn amount) of all outstanding letters of credit
issued thereunder and the return of any Credit-Linked Deposit (or similar deposit) made thereunder.
Until payment in full in cash of the Secured Obligations and, if applicable, the termination of
all commitments to extend credit thereunder, the discharge or cash collateralization (at 100% of
the aggregate undrawn amount) of all outstanding letters of credit issued thereunder and the return
of any Credit-Linked Deposit (or similar deposit) made thereunder, no Grantor shall demand or
receive any collateral security, payment or distribution whatsoever (whether in cash, property or
securities or otherwise) on account of any such right or claim. If any such payment or
distribution is made or becomes available to any Grantor in any bankruptcy case or receivership,
insolvency or liquidation proceeding, such payment or

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distribution shall be delivered by the Person
making such payment or distribution directly to the applicable Guaranteed Secured Debt
Representative, for application to the payment of the Secured Obligations. If any such payment or
distribution is received by any Grantor, it shall be held by such Grantor in trust, as trustee of
an express trust for the benefit of the Guaranteed Secured Parties, and shall forthwith be
transferred and delivered by such Grantor to the Collateral Trustee, in the exact form received
and, if necessary, duly endorsed.

          (e) The obligations of the Grantors under the Secured Debt Documents, including their
liability for the Secured Obligations and the enforceability of the security interests granted
thereby, are not contingent upon the validity, legality, enforceability, collectibility or
sufficiency of any right of reimbursement, contribution or subrogation arising under this Section
2.2. The invalidity, insufficiency, unenforceability or uncollectibility of any such right shall
not in any respect diminish, affect or impair any such obligation or any other claim, interest,
right or remedy at any time held by the Collateral Trustee or any other Secured Party against any
Grantor or its property. The Secured Parties make no representations or warranties in respect of
any such right and shall have no duty to assure, protect, enforce or ensure any such right or
otherwise relating to any such right.

          (f) Each Grantor reserves any and all other rights of reimbursement, contribution or
subrogation at any time available to it as against any other Grantor, but (i) the exercise and
enforcement of such rights shall be subject to Section 2.2(d) and (ii) neither the Collateral
Trustee nor any other Secured Party shall ever have any duty or liability whatsoever in respect of
any such right, except as provided in Section 2.2(c).

          2.3. Amendments, etc. with respect to the Borrower Obligations. Each Guarantor shall
remain obligated hereunder notwithstanding that, without any reservation of rights against any
Guarantor and without notice to or further assent by any Guarantor, any demand for payment of any
of the Borrower Obligations made by any Guaranteed Secured Debt Representative or any other
Guaranteed Secured Party may be rescinded by such Guaranteed Secured Debt Representative or such
other Guaranteed Secured Party and any of the Borrower Obligations continued, and the Borrower
Obligations, or the
liability of any other Person upon or for any part thereof, or any collateral security or
guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, increased, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by any Guaranteed Secured Debt Representative or any other Guaranteed
Secured Party, and the other Secured Debt Documents and any other documents executed and delivered
in connection therewith may be amended, modified, supplemented or terminated, in whole or in part,
as the requisite parties thereto may deem advisable from time to time, and any collateral security,
guarantee or right of offset at any time held by any Secured Party for the payment of the Borrower
Obligations may be sold, exchanged, waived, surrendered or released. No Guaranteed Secured Debt
Representative or any other Guaranteed Secured Party shall have any obligation to protect, secure,
perfect or insure any Lien at any time held by it as security for the Borrower Obligations or for
the guarantee contained in this Section 2 or any property subject thereto.

          2.4. Guarantee Absolute and Unconditional. Each Guarantor waives any and all notice
of the creation, renewal, extension or accrual of any of the Borrower Obligations and

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notice of or
proof of reliance by any Guaranteed Secured Debt Representative or any other Guaranteed Secured
Party upon the guarantee contained in this Section 2 or acceptance of the guarantee contained in
this Section 2; the Borrower Obligations, and any of them, shall conclusively be deemed to have
been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the
guarantee contained in this Section 2; and all dealings between the applicable Borrower and any of
the Guarantors, on the one hand, and the Guaranteed Secured Debt Representative and the other
Guaranteed Secured Parties, on the other hand, likewise shall be conclusively presumed to have been
had or consummated in reliance upon the guarantee contained in this Section 2. Each Guarantor
waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to
or upon the applicable Borrower or any of the Guarantors with respect to the Borrower Obligations.
Each Guarantor understands and agrees that the guarantee contained in this Section 2 shall be
construed as a continuing, absolute and unconditional guarantee of payment and performance without
regard to (a) the validity or enforceability of any Secured Debt Document, any of the Borrower
Obligations or any other collateral security therefor or guarantee or right of offset with respect
thereto at any time or from time to time held by any Guaranteed Secured Debt Representative or any
other Guaranteed Secured Party, (b) any defense, set-off or counterclaim (other than a defense of
payment or performance hereunder) which may at any time be available to or be asserted by the
applicable Borrower or any other Person against any Guaranteed Secured Debt Representative or any
other Guaranteed Secured Party, or (c) any other circumstance whatsoever (with or without notice to
or knowledge of the applicable Borrower or such Guarantor) which constitutes, or might be construed
to constitute, an equitable or legal discharge of the applicable Borrower for the Borrower
Obligations, or of such Guarantor under the guarantee contained in this Section 2, in bankruptcy or
in any other instance. When making any demand hereunder or otherwise pursuing its rights and
remedies hereunder against any Guarantor, any Guaranteed Secured Debt Representative or any other
Guaranteed Secured Party may, but shall be under no obligation to, make a similar demand on or
otherwise pursue such rights and remedies as it may have against the applicable Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee for the
Borrower Obligations or any right of offset with respect thereto, and any failure by any
Guaranteed Secured Party to make any such demand, to pursue such other rights or remedies or to
collect any payments from the applicable Borrower, any other Guarantor or any other Person or to
realize upon any such collateral security or guarantee or to exercise any such right of offset, or
any release of the applicable Borrower, any other Guarantor or any other Person or any such
collateral security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of any Guaranteed Secured Debt Representative or
any other Guaranteed Secured Party against any Guarantor. For the purposes hereof “demand” shall
include the commencement and continuance of any legal proceedings.

          2.5. Reinstatement. The guarantee contained in this Section 2 shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Borrower Obligations is rescinded or must otherwise be restored or returned by any
Guaranteed Secured Debt Representative or any other Guaranteed Secured Party upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the applicable Borrower or any Guarantor,
or upon or as a result of the appointment of a receiver, intervenor or conservator

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of, or trustee
or similar officer for, the applicable Borrower or any Guarantor or any substantial part of its
property, or otherwise, all as though such payments had not been made.

          2.6. Payments. Each Guarantor hereby guarantees that payments hereunder will be paid
to each Guaranteed Secured Debt Representative without set-off or counterclaim in dollars in
immediately available funds at the office of such Guaranteed Secured Debt Representative specified
in the applicable Secured Debt Documents as the office for payments thereunder.

SECTION 3. GRANT OF SECURITY INTEREST;

CONTINUING LIABILITY UNDER COLLATERAL

          (a) (x) Each Grantor hereby (i) affirms that is has assigned and transferred to the Priority
Collateral Trustee, and has granted to the Priority Collateral Trustee, for the ratable benefit of
the Priority Lien Secured Parties, a lien on and, except as set forth in Section 4.2 or 4.3, a
first priority security interest in all of the personal property of such Grantor, including, in any
event, the property described in items (i) through (xxi) below, in each case, wherever located and
now owned or at any time hereafter acquired by such Grantor or in which such Grantor now has or at
any time in the future may acquire any right, title or interest (collectively, the
“Collateral”), as collateral security for the prompt and complete payment and performance
when due (whether at the stated maturity, by acceleration or otherwise) of the Priority Lien
Obligations and (ii) affirms that it has assigned and transferred to the Parity Collateral Trustee,
and has granted to the Parity Collateral Trustee, for the ratable benefit of the Parity Lien
Secured Parties, a lien on and, except as set forth in Section 4.2 or 4.3, a second priority
security interest in all of the Collateral, as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of
the Parity Lien Obligations, and (y) each Grantor hereby (i) assigns and transfers to the Priority
Collateral Trustee, and
hereby grants to the Priority Collateral Trustee, for the equal and ratable benefit of the
Priority Lien Secured Parties, a lien on and, except as set forth in Section 4.2 or 4.3, a first
priority security interest in all of the Collateral, as collateral security for the prompt and
complete payment and performance when due (whether at stated maturity, by acceleration or
otherwise) of the Priority Lien Obligations, (ii) assigns and transfers to the Parity Collateral
Trustee, and hereby grants to the Parity Collateral Trustee, for the equal and ratable benefit of
the Parity Lien Secured Parties, a lien on and, except as set forth in Section 4.2 or 4.3, a second
priority security interest in all of the Collateral, as collateral security for the prompt and
complete payment and performance when due (whether at the stated maturity, by acceleration or
otherwise) of the Parity Lien Obligations, and (iii) assigns and transfers to the Account
Collateral Trustee and hereby grants to the Account Collateral Trustee, for the benefit of the
Priority Lien Secured Parties and the Parity Lien Secured Parties, a lien on and security interest
in all Deposit Accounts and Securities Accounts, in each case as collateral security for the prompt
and complete payment and performance when due (whether at the stated maturity, by acceleration or
otherwise) of the Priority Lien Obligations and the Parity Lien Obligations, respectively (it being
understood that the grants of security interest under the foregoing clause (y)(i), clause (y)(ii)
and clause (y)(iii) constitute three separate and distinct grants of security and Liens, one in
favor of the Priority Collateral Trustee in its capacity as collateral agent for the equal and
ratable benefit of the Priority Lien Secured Parties to secure the Priority Lien Obligations and
the second in favor of the Parity Collateral Trustee in its capacity as collateral agent for the
equal and ratable benefit of

25

 

the Parity Lien Secured Parties to secure the Parity Lien Obligations)
and the third in favor of the Account Collateral Trustee for the benefit of
the Priority Lien
Secured Parties and the Parity Lien Secured Parties to secure the Priority Lien Obligations and the
Parity Lien Obligations, respectively:

               (i) all Accounts;

               (ii) all Chattel Paper;

               (iii) all Collateral Accounts and all Collateral Account Funds;

               (iv) all Commercial Tort Claims from time to time specifically described on Schedule
4.13;

               (v) all Contracts;

               (vi) all Deposit Accounts;

               (vii) all Documents;

               (viii) all Equipment;

               (ix) all Fixtures;

               (x) all General Intangibles;

               (xi) all Goods;

               (xii) all Instruments;

               (xiii) all Insurance;

               (xiv) all Intellectual Property;

               (xv) all Inventory;

               (xvi) all Investment Property;

               (xvii) all Letters of Credit and Letter of Credit Rights;

               (xviii) all Money;

               (xix) all Securities Accounts;

               (xx) all books, records, ledger cards, files, correspondence, customer lists,
blueprints, technical specifications, manuals, computer software, computer printouts, tapes,
disks and other electronic storage media and related data processing software and similar
items that at any time pertain to or evidence or contain information

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relating to any of the
Collateral or are otherwise necessary or helpful in the collection thereof or realization
thereupon; and

               (xxi) to the extent not otherwise included, all other property, whether tangible or
intangible, of the Grantor and all Proceeds and products accessions, rents and profits of
any and all of the foregoing and all collateral security, Supporting Obligations and
guarantees given by any Person with respect to any of the foregoing;

provided, however, that notwithstanding any of the other provisions set forth in
this Section 3, this Agreement shall not, at any time, constitute a grant of a security interest in
any property that is, at such time, an Excluded Asset. The Grantor, the Priority Collateral
Trustee, Parity Collateral Trustee and Account Collateral Trustee hereby acknowledge and agree that
the security interest created hereby in the Collateral is not, in and of itself, to be construed as
a grant of a fee interest in (as opposed to a security interest in) any Copyright, Trademark,
Patent, Copyright License, Patent License, Trademark License, Trade Secret or Trade Secret License.

          This Agreement, and the security interests and Liens granted and created herein, secures the
payment and performance of all Secured Obligations now or hereafter in effect, whether direct or
indirect, absolute or contingent, and whether for principal, reimbursement obligations, interest
(including any interest accruing at the then applicable rate provided in any applicable Secured
Debt Document after the maturity of the Indebtedness thereunder and reimbursement obligations
therein and interest accruing at the then applicable rate provided in any applicable Secured Debt
Document after the filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding relating to any Grantor, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding), fees, premiums, penalties,
indemnifications, expenses or otherwise, and including all amounts that constitute part of the
Secured Obligations and would be owed by any Grantor but for the fact that they are unenforceable
or not allowed due to a pending Bankruptcy Case or Insolvency
Proceeding. Without limiting the generality of the foregoing, it is the intent of the parties
that (i) the Liens securing the Parity Lien Obligations are subject and subordinate to the Liens
securing the Priority Lien Obligations and (ii) this Agreement creates two separate and distinct
Liens: the first priority Lien securing the payment and performance of the Priority Lien
Obligations and the second priority Lien securing the payment and performance of the Parity Lien
Obligations, in each case as may be more particularly set forth in the Collateral Trust Agreement.
For purposes of perfecting the security interests hereunder, all property in the possession or
control of the Collateral Trustee will be held by the Collateral Trustee in its capacity as
Priority Collateral Trustee for the benefit of the Priority Lien Secured Parties and in its
capacity as Parity Collateral Trustee for the benefit of the Parity Lien Secured Parties, and in
its capacity as Account Collateral Trustee for the benefit of the Priority Lien Secured Parties and
the Parity Lien Secured Parties, in each case subject to the terms of the Collateral Trust
Agreement.

          (b) Notwithstanding anything herein to the contrary, (i) each Grantor shall remain liable for
all obligations under and in respect of the Collateral and nothing contained herein is intended or
shall be a delegation of duties to the Collateral Trustee or any other Secured Party, (ii) each
Grantor shall remain liable under each of the agreements included in the Collateral, including any
Receivables, any Contracts and any agreements relating to Pledged Partnership Interests or Pledged
LLC Interests, to perform all of the obligations undertaken by it

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thereunder all in accordance with
and pursuant to the terms and provisions thereof and neither the Collateral Trustee nor any other
Secured Party shall have any obligation or liability under any of such agreements by reason of or
arising out of this Agreement or any other document related hereto nor shall the Collateral Trustee
nor any other Secured Party have any obligation to make any inquiry as to the nature or sufficiency
of any payment received by it or have any obligation to take any action to collect or enforce any
rights under any agreement included in the Collateral, including any agreements relating to any
Receivables, any Contracts, or any agreements relating to Pledged Partnership Interests or Pledged
LLC Interests and (iii) the exercise by the Collateral Trustee of any of its rights hereunder shall
not release any Grantor from any of its duties or obligations under the contracts and agreements
included in the Collateral, including any agreements relating to any Receivables, any Contracts and
any agreements relating to Pledged Partnership Interests or Pledged LLC Interests.

SECTION 4. REPRESENTATIONS AND WARRANTIES

          To induce the applicable Secured Parties to enter into the Secured Debt Documents and to
induce the applicable Secured Parties to make their respective extensions of credit to the
applicable Grantor or Grantors thereunder, each Grantor hereby represents and warrants to the
Collateral Trustee and each other applicable Secured Party that:

          4.1. Representations in Secured Debt Documents. In the case of each Grantor, the
representations and warranties set forth in each credit agreement and indenture constituting a
Secured Debt Document as they relate to such Grantor or to the Secured Debt Documents to which such
Grantor is a party, each of which is hereby incorporated herein by reference, are true and correct
in all material respects, except for representations and warranties expressly stated to relate to a
specific earlier date, in which case such representations and warranties shall be true and correct
in all material respects as of such
earlier date, and the Collateral Trustee and the other Secured Parties shall be entitled to
rely on each of them as if they were fully set forth herein (to the extent that such Secured
Parties are parties to or have the benefit of the Secured Debt Document in which such
representatives and warranties are contained); provided that each reference in each such
representation and warranty to a Person’s knowledge shall, for the purposes of this Section 4.l, be
deemed to be a reference to such Grantor’s knowledge.

          4.2. Title; No Other Liens. Such Grantor owns each item of the Collateral in which it
purports to grant a Lien hereunder free and clear of any and all Liens or claims, including Liens
arising as a result of such Grantor becoming bound (as a result of merger or otherwise) as grantor
under a security agreement entered into by another Person, except for Liens expressly permitted to
exist on the Collateral by each of the Secured Debt Documents. No financing statement, mortgage or
other public notice with respect to all or any part of the Collateral is on file or of record in
any public office, except such as have been filed in favor of the Collateral Trustee, for the
benefit of the Secured Parties, pursuant to this Agreement or as are expressly permitted by each of
the Secured Debt Documents.

          4.3. Perfected First Priority Liens. The security interests granted pursuant to this
Agreement (a) upon completion of the filings and other actions specified on Schedule 4.3(a) (all of
which, in the case of all filings and other documents listed on such schedule, have been delivered
to the Collateral Trustee in duly completed and duly executed form, as applicable, and

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may be filed
by or on behalf of the Collateral Trustee at any time) and payment of all filing fees, will
constitute valid, fully-perfected security interests in all of the Collateral (other than the
Excluded Perfection Assets) in favor of the Collateral Trustee, for the benefit of the Secured
Parties, as collateral security for such Grantor’s Secured Obligations, enforceable in accordance
with the terms hereof and of the Collateral Trust Agreement, (b) are, to the extent that such Liens
have been granted to the Collateral Trustee for the benefit of the Priority Lien Secured Parties,
prior to all other Liens on the Collateral except for Liens expressly permitted by each of the
Secured Debt Documents and (c) are, to the extent that such Liens have been granted to the
Collateral Trustee for the benefit of the Parity Lien Secured Parties, prior to all other Liens on
the Collateral except for the prior Liens for the benefit of the Priority Lien Secured Parties and
for Liens expressly permitted by each of the Secured Debt Documents. Without limiting the
foregoing, each Grantor has taken all actions necessary or desirable, including those specified in
Section 5.2, to: (i) establish the Collateral Trustee’s “control” (within the meanings of Sections
8-106 and 9-106 of the New York UCC) over any portion of the Investment Property constituting
Certificated Securities, Uncertificated Securities, Securities Accounts, Securities Entitlements or
Commodity Accounts, (ii) establish the Collateral Trustee’s “control” (within the meaning of
Section 9-104 of the New York UCC) over all Deposit Accounts, (iii) establish the Collateral
Trustee’s “control” (within the meaning of Section 9-107 of the New York UCC) over all Letter of
Credit Rights, (iv) establish the Collateral Trustee’s control (within the meaning of Section 9-105
of the New York UCC) over all Electronic Chattel Paper and (v) establish the Collateral Agent’s
“control” (within the meaning of Section 16 of the Uniform Electronic Transaction Act as in effect
in the applicable jurisdiction (the “UETA”)) over all “transferable records” (as defined in
UETA).

          4.4. Name; Jurisdiction of Organization, etc. On the date hereof, such Grantor’s
exact legal name (as indicated on the public record of such Grantor’s jurisdiction of formation or
organization), jurisdiction of organization, organizational identification number, if any, and the
location of such Grantor’s chief executive office or sole place of business are specified on
Schedule 4.4. Each Grantor is organized solely under the law of the jurisdiction so specified and
has not filed any certificates of domestication, transfer or continuance in any other jurisdiction.
Except as specified on Schedule 4.4, (i) no such Grantor has changed its name, jurisdiction of
organization, chief executive office or sole place of business within the past five years, (ii) no
such Grantor has within the last five years become bound (whether as a result of merger or
otherwise) as a grantor under a security agreement entered into by another Person which has not
heretofore been terminated and (iii) no such Grantor has changed its corporate structure in any way
(e.g. by merger, consolidation, change in corporate form or otherwise) within the past two years.

          4.5. Inventory and Equipment. (a) On the date hereof, the Inventory and the
Equipment (other than mobile goods) that is included in the Collateral are kept at the locations
listed on Schedule 4.5(a). Within the two years preceding execution of this agreement, such
Grantor has not changed the location of a material portion of its Equipment and Inventory that is
included in the Collateral except as otherwise disclosed on Schedule 4.5(a).

          (b) None of the Inventory or Equipment that is included in the Collateral having a book value
(net of depreciation) in excess of $250,000 is in the possession of an issuer

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of a negotiable
document (as defined in Section 7-104 of the New York UCC) therefor or, except as set forth on
Schedule 4.5(b), is otherwise in the possession of any bailee or warehouseman.

          4.6. Condition and Maintenance of Equipment. The Equipment of such Grantor that is
included in the Collateral is in good repair, working order and condition, reasonable wear and tear
excepted. Each Grantor shall cause its Equipment that is included in the Collateral to be
maintained and preserved in good repair, working order and condition, reasonable wear and tear
excepted, and shall as quickly as commercially practicable make or cause to be made all repairs,
replacements and other improvements which are necessary or appropriate in the conduct of such
Grantor’s business in its prudent business judgment.

          4.7. Farm Products. None of the Collateral constitutes, or is the Proceeds of, Farm
Products.

          4.8. Investment Property. (a) Schedule 4.8(a) (as such schedule may be amended
or supplemented from time to time) sets forth under the headings “Pledged Stock,” “Pledged LLC
Interests,”
“Pledged Partnership Interests” and “Pledged Trust Interests,” respectively, all of the
Pledged Stock, Pledged LLC Interests, Pledged Partnership Interests and Pledged Trust Interests
owned by any Grantor and such Pledged Equity Interests constitute the percentage of issued and
outstanding shares of stock, percentage of membership interests, percentage of partnership
interests or percentage of beneficial interest of the respective issuers thereof indicated on such
Schedule. Schedule 4.8(b) (as such schedule may be amended or supplemented from time to time) sets
forth under the heading “Pledged Debt Securities” or “Pledged Notes” all of the Pledged Debt
Securities and Pledged Notes (if any) owned by any Grantor and each of such Pledged Debt Securities
and Pledged Notes (if any) has been duly authorized, authenticated or issued and delivered and is
the legal, valid and binding obligation of the issuers thereof enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principals of equity, regardless of
whether considered in a proceeding in equity or at law, and is not in default and constitutes all
of the issued and outstanding inter-company indebtedness evidenced by an instrument or certificated
security of the respective issuers thereof owing to such Grantor. Schedule 4.8(c) (as such
schedule may be amended or supplemented from time to time) sets forth under the headings
“Securities Accounts,” “Commodities Accounts,” and “Deposit Accounts” respectively, all of the
Securities Accounts, Commodities Accounts and Deposit Accounts in which each Grantor has an
interest that are included in the Collateral. Each Grantor is the sole entitlement holder or
customer of each such account set forth opposite its name on such schedule, and such Grantor has
not consented to, and is not otherwise aware of, any Person (other than the Collateral Trustee
pursuant hereto) having “control” (within the meanings of Sections 8-106, 9-106 and 9-104 of the
New York UCC) over, or any other interest in, any such Securities Account, Commodity Account or
Deposit Account or any securities, commodities or other property credited thereto, except for any
such account that constitutes an Excluded Asset.

          (b) The shares of Pledged Equity Interests pledged by such Grantor hereunder constitute all of
the issued and outstanding shares of all classes of the Capital Stock of each Issuer owned by such
Grantor or, in the case of Excluded Foreign Subsidiary Voting Stock, if less, 66% of the
outstanding Excluded Foreign Subsidiary Voting Stock of each relevant Issuer.

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          (c) The Pledged Equity Interests have been duly and validly issued and all the shares of the
Pledged Stock are fully paid and nonassessable.

          (d) As of the Restatement Date, the terms of any uncertificated Pledged LLC Interests and
Pledged Partnership Interests do not provide that they are securities governed by Article 8 of the
Uniform Commercial Code in effect from time to time in the “issuer’s jurisdiction” of each Issuer
thereof (as such term is defined in the Uniform Commercial Code in effect in such jurisdiction).

          (e) There shall be no certificated Pledged LLC Interests or Pledged Partnership Interests
which expressly provide that they are securities governed by Article 8 of the Uniform Commercial
Code in effect from time to time in the “issuer’s jurisdiction” of each Issuer thereof, except if
such certificate has been delivered to the Collateral Trustee pursuant to the terms hereof.

          (f) Such Grantor is the record and beneficial owner of, and has good and marketable title to,
the Investment Property and Deposit Accounts pledged by it hereunder, free of any and all Liens or
options in favor of, or claims of, any other Person, except Liens expressly permitted to exist
thereon by each of the Secured Debt Documents, and there are no outstanding warrants, options or
other rights to purchase, or shareholder, voting trust or similar agreements outstanding with
respect to, or property that is convertible into, or that requires the issuance or sale of, any
Pledged Equity Interests.

          (g) Each Issuer that is not a Grantor hereunder has executed and delivered to the Collateral
Trustee an Acknowledgment and Consent, in substantially the form of Exhibit C, to the pledge of the
Pledged Securities pursuant to this Agreement.

          4.9. Receivables. (a) No amount payable to such Grantor under or in connection with
any Receivable that is included in the Collateral is evidenced by any Instrument or Tangible
Chattel Paper which has not been delivered to the Collateral Trustee or constitutes Electronic
Chattel Paper that has not been subjected to the control (within the meaning of Section 9-105 of
the New York UCC) of the Collateral Trustee.

          (b) None of the obligors (other than “independent system operators”) on any Receivable that is
included in the Collateral in excess of $500,000 individually or $1,000,000 in the aggregate is a
Governmental Authority.

          (c) Each Receivable that is included in the Collateral (i) is and will be the legal, valid and
binding obligation of the Account Debtor in respect thereof, representing an unsatisfied obligation
of such Account Debtor, (ii) is and will be enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’
rights generally and subject to general principles of equity, regardless of whether considered in a
proceeding in equity or at law, (iii) is not and will not be subject to any defenses or taxes and
(iv) is and will be in compliance with all applicable laws and regulations.

          4.10. Contracts.

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          (a) Schedule 4.10(a) (as such schedule may be amended or supplemented form time to time) sets
forth all of the Material Contracts in which such Grantor has any right or interest.

          (b) Except as set forth on Schedule 4.10(b), no Material Contract prohibits assignment or
encumbrance by such Grantor or requires or purports to require consent of, or notice to, any party
(other than such Grantor) to any Material Contract in connection with the execution, delivery and
performance of this Agreement, including the exercise of remedies by
the Collateral Trustee with respect to such Material Contract, except for such consents that
have been obtained and such notices that have been given.

          (c) Each Material Contract is in full force and effect and constitutes a valid and legally
enforceable obligation of the Grantor party thereto and (to the best of such Grantor’s knowledge)
each other party thereto, subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.

          (d) The right, title and interest of such Grantor in, to and under the Material Contracts are
not subject to any defenses, rights of recoupment or claims.

          (e) Neither such Grantor nor (to the best of such Grantor’s knowledge) any of the other
parties to the Material Contracts is in default in the performance or observance of any of the
terms thereof.

          (f) The right, title and interest of such Grantor in, to and under the Material Contracts are
not subject to any defenses or claims.

          (g) Such Grantor has delivered to the Collateral Trustee a complete and correct copy of each
Material Contract, including all amendments, supplements and other modifications thereto.

          (h) No amount payable to such Grantor under or in connection with any Contract which has a
value in excess of $500,000 individually or $1,000,000 in the aggregate is evidenced by any
Instrument or Tangible Chattel Paper which has not been delivered to the Collateral Trustee or
constitutes Electronic Chattel Paper that is not under the control (within the meaning of Section
9-105 of the New York UCC) of the Collateral Trustee.

          (i) None of the parties to any Contract (other than “independent system operators”) which has
a value in excess of $500,000 individually or $1,000,000 in the aggregate is a Governmental
Authority.

          4.11. Intellectual Property. (a) Schedule 4.11(a) lists all Intellectual
Property which is registered with a Governmental Authority or is the subject of an application for
registration and all material unregistered Intellectual Property forming part of the Core
Collateral, in each case which is owned by such Grantor in its own name on the date hereof
(collectively, the “Owned Intellectual Property”). Except as set forth in Schedule 4.11,
such Grantor is the exclusive owner of the entire and unencumbered right, title and interest in and
to

32

 

all Owned Intellectual Property and is otherwise entitled to use, and grant to others the right
to use, all Owned Intellectual Property, subject only to the license terms of the licensing or
franchise agreements referred to in paragraph (c) below. Such Grantor has a valid and enforceable
right to use all Intellectual Property which it uses in its business, but does not own
(collectively, the “Licensed Intellectual Property”).

          (b) On the date hereof, all Owned Intellectual Property and, to such Grantor’s knowledge, all
Licensed Intellectual Property, in each case, which is material to such Grantor’s business
(collectively, and subject to the foregoing knowledge qualifier in the case of Licensed
Intellectual Property, the “Material Intellectual Property”), is valid, subsisting,
unexpired and enforceable, has not been abandoned. Neither the operation of such Grantor’s
business as currently conducted or as contemplated to be conducted nor the use of the Intellectual
Property in connection therewith conflicts with, infringes, misappropriates, dilutes, misuses or
otherwise violates the intellectual property rights of any other Person, in each case, which
conflict, infringement, misappropriation, dilution, misuse or violation could reasonably be
expected to have a Material Adverse Effect, and no claim has been so asserted by any other Person.

          (c) Except as set forth in Schedule 4.11(c), on the date hereof (i) none of the Material
Intellectual Property is the subject of any licensing or franchise agreement pursuant to which such
Grantor is the licensor or franchisor and (ii) there are no other agreements, obligations, orders
or judgments which affect the use of any Material Intellectual Property.

          (d) To such Grantor’s knowledge, no holding, decision or judgment has been rendered by any
Governmental Authority or arbitrator in the United States or outside the United States which would
limit, cancel or question the validity or enforceability of, or such Grantor’s rights in, any
Material Intellectual Property. Such Grantor is not aware of any uses of any item of Material
Intellectual Property that could reasonably be expected to lead to such item becoming invalid or
unenforceable, including unauthorized uses by third parties and uses which were not supported by
the goodwill of the business connected with Trademarks and Trademark Licenses.

          (e) No action or proceeding is pending, or, to such Grantor’s knowledge, threatened, on the
date hereof (i) seeking to limit, cancel or question the validity of any Owned Intellectual
Property, (ii) alleging that any services provided by, processes used by, or products manufactured
or sold by such Grantor infringe any patent, trademark, copyright, or any other right of any other
Person, (iii) alleging that any Material Intellectual Property is being licensed, sublicensed or
used in violation of any intellectual property or any other right of any other Person or (iv)
which, if adversely determined, would have a material adverse effect on the value of any Material
Intellectual Property. To such Grantor’s knowledge, no Person is engaging in any activity that
infringes upon, or is otherwise an unauthorized use of, any Material Intellectual Property or upon
the rights of such Grantor therein. Except as set forth in Schedule 4.11(e), such Grantor has not
granted any license, release, covenant not to sue, non-assertion assurance, or other right to any
Person with respect to any part of the Material Intellectual Property. The consummation of the
transactions contemplated by this Agreement (including the enforcement of remedies) will not result
in the termination or impairment of any of the Material Intellectual Property.

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          (f) With respect to each Copyright License, Trademark License, Trade Secret Licenses and
Patent License which relates to Material Intellectual Property or the loss of which could otherwise
have a Material Adverse Effect: (i) such license is valid and binding and in full force and effect
and represents the entire agreement between the respective licensor and licensee with respect to
the subject matter of such license; (ii) such license will not cease to be valid and binding and in
full force and effect on terms identical to those currently in effect as a result of the rights and
interests granted herein, nor will the grant of such rights and interests constitute a
breach or default under such license or otherwise give the licensor or licensee a right to
terminate such license; (iii) such Grantor has not received any notice of termination or
cancellation under such license; (iv) such Grantor has not received any notice of a breach or
default under such license, which breach or default has not been cured; (v) such Grantor has not
granted to any other Person any rights, adverse or otherwise, under such license; and (vi) such
Grantor is not in breach or default in any material respect, and no event has occurred that, with
notice and/or lapse of time, would constitute such a breach or default or permit termination,
modification or acceleration under such license.

          (g) Except as set forth in Schedule 4.11, such Grantor has performed all acts and has paid all
required fees and taxes to maintain each and every item of registered owned Intellectual Property
that is material to its business in full force and effect and to protect and maintain its interest
therein. Such Grantor has used proper statutory notice in connection with its use of each Patent,
Trademark and Copyright that is material to its business included in the Intellectual Property.

          (h) (i) None of the Trade Secrets of such Grantor that are material to its business has been
used, divulged, disclosed or appropriated to the detriment of such Grantor for the benefit of any
other Person; (ii) no employee, independent contractor or agent of such Grantor has misappropriated
any trade secrets of any other Person in the course of the performance of his or her duties as an
employee, independent contractor or agent of such Grantor; and (iii) no employee, independent
contractor or agent of such Grantor is in default or breach of any term of any employment
agreement, non-disclosure agreement, assignment of inventions agreement or similar agreement or
contract relating in any way to the protection, ownership, development, use or transfer of such
Grantor’s Intellectual Property.

          (i) Such Grantor has taken all commercially reasonable steps to use consistent standards of
quality in the manufacture, distribution and sale of all products sold and provision of all
services provided under or in connection with any item of Intellectual Property and has taken all
steps to ensure that all licensed users of any kind of Intellectual Property use such consistent
standards of quality.

          4.12. Letters of Credit and Letter of Credit Rights. No Grantor is a beneficiary or
assignee under any Letter of Credit other than the Letters of Credit described on Schedule 4.12 (as
such schedule may be amended or supplemented from time to time). With respect to any Letters of
Credit that are by their terms transferable, each Grantor has caused (or, in the case of the
Letters of Credit that are specified on Schedule 4.12 on the date hereof, will use commercially
reasonable efforts to cause) all issuers and nominated persons under Letters of Credit in which the
Grantor is the beneficiary or assignee to consent to the assignment of such Letter of Credit to the
Collateral Trustee and has agreed that upon the occurrence of a Secured

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Debt Default it shall cause
all payments thereunder to be made to the Collateral Account. With respect to any Letters of
Credit that are not transferable, each Grantor shall obtain (or, in the case of the Letters of
Credit that are specified on Schedule 4.12 on the date hereof, use commercially reasonable efforts
to obtain) the consent of the issuer thereof and any nominated Person thereon to the assignment of
the proceeds of the
released Letter of Credit to the Collateral Trustee in accordance with Section 5-114(c) of the
New York UCC.

          4.13. Commercial Tort Claims. No Grantor has any Commercial Tort Claims as of the
date hereof individually or in the aggregate in excess of $500,000 and, except as specifically
described on Schedule 4.13 (as such schedule may be amended or supplemented from time to time), no
Grantor has any Commercial Tort Claims after the date hereof individually or in the aggregate in
excess of $500,000.

SECTION 5. COVENANTS

          Each Grantor covenants and agrees with the Collateral Trustee and the other Secured Parties
that, from and after the date of this Agreement, until the Secured Obligations (other than Secured
Obligations in respect of any Specified Hedging Agreement and indemnification and other contingent
obligations not then due and payable) shall have been paid in full in cash, no letter of credit
issued under any Secured Debt Document shall be outstanding, any Credit-Linked Deposits (or similar
deposits) shall have been returned and all commitments to extend credit under all Secured Debt
Documents shall have expired or been terminated:

          5.1. Covenants in Secured Debt Documents. Each Grantor shall take, or shall refrain
from taking, as the case may be, each action that is necessary to be taken or not taken, as the
case may be, so that no Secured Debt Default under any Secured Debt Document is caused by the
failure to take such action or to refrain from taking such action by such Grantor.

          5.2. Delivery and Control of Instruments, Certificated Securities, Chattel Paper,
Negotiable Documents, Investment Property and Letter of Credit Rights. (a) If any of the
Collateral is or shall become evidenced or represented by any Instrument, Certificated Security,
Negotiable Document or Tangible Chattel Paper, such Instrument (other than checks received in the
ordinary course of business), Certificated Security, Negotiable Documents or Tangible Chattel Paper
shall promptly be delivered to (or, in the case of the Pledged NEO Notes, the Company or such other
applicable Grantor shall use commercially reasonable efforts to cause such Pledged NEO Notes to be
delivered to) the Collateral Trustee, duly endorsed in a manner reasonably satisfactory to the
Collateral Trustee, to be held as Collateral pursuant to this Agreement, and all of such property
owned by any Grantor as of the Restatement Date shall be delivered on the Restatement Date.

          (b) If any of the Collateral is or shall become “Electronic Chattel Paper” such Grantor shall
ensure that (i) a single authoritative copy exists which is unique, identifiable, unalterable
(except as provided in clauses (iii), (iv) and (v) of this paragraph), (ii) such authoritative copy
identifies the Collateral Trustee as the assignee and is communicated to and maintained by the
Collateral Trustee or its designee, (iii) copies or revisions that add or change the assignee of
the authoritative copy can only be made with the participation of the Collateral Trustee, (iv) each
copy of the authoritative copy and any copy of a copy is readily identifiable as

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a copy and not the authoritative copy and (v) any revision of the authoritative copy is
readily identifiable as an authorized or unauthorized revision.

          (c) If any of the Collateral is or shall become evidenced or represented by an Uncertificated
Security, such Grantor shall cause the Issuer thereof either (i) to register the Collateral Trustee
as the registered owner of such Uncertificated Security, upon original issue or registration of
transfer or (ii) to agree in writing with such Grantor and the Collateral Trustee that such Issuer
will comply with instructions with respect to such Uncertificated Security originated by the
Collateral Trustee without further consent of such Grantor, such agreement to be in substantially
the form of Exhibit C, and such action shall be taken on or prior to the Restatement Date with
respect to any Uncertificated Securities owned as of the Restatement Date by any Grantor.

          (d) Each Grantor shall maintain Securities Entitlements, Securities Accounts and Deposit
Accounts (other than any which constitute Excluded Perfection Assets) only with financial
institutions that have agreed, pursuant to Control Agreements (Deposit and Securities Accounts), to
comply with entitlement orders and instructions issued or originated by the Collateral Trustee
without further consent of such Grantor.

          (e) If any of the Collateral is or shall become evidenced or represented by a Commodity
Contract, such Grantor shall cause the Commodity Intermediary with respect to such Commodity
Contract to agree in writing with such Grantor and the Collateral Trustee, pursuant to a Control
Agreement (Commodity Contracts), that such Commodity Intermediary will apply any value distributed
on account of such Commodity Contract as directed by the Collateral Trustee without further consent
of such Grantor.

          (f) In addition to and not in lieu of the foregoing, if any Issuer of any Investment Property
is organized under the law of, or has its chief executive office in, a jurisdiction outside of the
United States, each Grantor shall take such additional actions, including causing the issuer to
register the pledge on its books and records, as may be necessary or advisable or as may be
reasonably requested by the Collateral Trustee, under the laws of such jurisdiction to insure the
validity, perfection and priority of the security interest of the Collateral Trustee.

          (g) In the case of any transferable Letters of Credit in excess of $250,000 individually or in
the aggregate, each Grantor shall use commercially reasonable efforts to obtain the consent of any
issuer thereof to the transfer of such Letter of Credit to the Collateral Trustee. In the case of
any other Letter-of-Credit Rights in excess of $250,000 individually or in the aggregate each
Grantor shall use commercially reasonable efforts to obtain the consent of the issuer thereof and
any nominated Person thereon to the assignment of the proceeds of the related Letter of Credit in
accordance with Section 5-114(c) of the New York UCC.

          (h) Each Grantor agrees (i) to cause (or, in the case of any Pledged LLC Interest that have
been issued by an Issuer that is not a Subsidiary, to use commercially reasonable efforts to cause)
each Pledged LLC Interest and Pledged Partnership Interest to be represented by a certificate
delivered to the Collateral Trustee pursuant to the terms hereof and (ii) to cause (or, in the case
of any Pledged LLC Interest that have been issued by an Issuer that

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is not a Subsidiary, to use
commercially reasonable efforts to cause) the terms thereof to
expressly provide that each such Pledged LLC Interest and Pledged Partnership Interest is a
security governed by Article 8 of the New York UCC, in each case no later than 60 days following
the date hereof and for all times thereafter during the term of this Agreement.

          5.3. Maintenance of Insurance. (a) Such Grantor shall keep its properties that are
of an insurable character adequately insured at all times by financially sound and responsible
insurers, which, in the case of any insurance on any property with respect to which a mortgage has
been granted pursuant to the terms of any Security Documents, are licensed to do business in the
States where the applicable property is located; maintain such other insurance, to such extent and
against such risks (and with such deductibles, retentions and exclusions), including fire and other
risks insured against by extended coverage and coverage for acts of terrorism, in each case as is
customary with companies of a similar size operating in the same or similar businesses, including
public liability insurance against claims for personal injury or death or property damage; and
maintain such other insurance as may be required by law; provided that in any event such
Grantor shall maintain, to the extent obtainable on commercially reasonable terms, (i) property and
machinery breakage insurance on all real and personal property on an all risks basis (including the
perils of flood and quake and loss by fire, explosion and theft), covering the repair or
replacement cost of all such property (with the exception of losses from terrorism, earthquake and
flood which may be subject to the highest amount commercially and reasonably available), (ii)
consequential loss coverage for business interruption and extra expense (which shall include
construction expenses and such other business interruption expenses as are otherwise generally
available to similar businesses) in an amount of not less than 12 months gross revenues and (iii)
public liability insurance providing limits of $150,000,000 per occurrence and in the aggregate for
bodily injury and property damage to third parties resulting from such Grantor’s operations; which
public liability insurance shall be written to include worldwide risks on a commercial general
liability form. All such insurance with respect to such Grantor shall be provided by insurers or
reinsurers which have an A.M. Best policyholders rating of not less than A- or a Standard & Poor
rating of not less than BBB, or, if the relevant insurance is not available from such insurers,
such other insurers as the Collateral Trustee may approve in writing, acting reasonably. All
insurance shall (i) provide that no cancellation, material reduction in amount or material change
in coverage thereof shall be effective until at least 30 days (or, in the case of non-payment of
premium, 10 days) after receipt by the Collateral Trustee of written notice thereof, (ii) if
reasonably requested by the Collateral Trustee, include a breach of warranty clause and (iii) be
reasonably satisfactory in all other respects to the Collateral Trustee.

          (b) The Company shall deliver to the Collateral Trustee on behalf of the Secured Parties, (i)
on the Restatement Date, a certificate dated such date showing the amount and types of insurance
coverage as of such date, (ii) upon request of any Secured Debt Representative or the Collateral
Trustee from time to time, full information as to the insurance carried, (iii) promptly following
receipt of notice from any insurer, a copy of any notice of
cancellation of any material coverage or material change in coverage from that existing on the
Restatement Date, (iv) forthwith, notice of any cancellation or nonrenewal of material coverage by
any Grantor and (v) promptly after such information is available to the Company, full information
as to any claim for an amount in excess of $5,000,000 with respect to any property or machinery
breakage insurance policy maintained by such Grantor. The Collateral Trustee shall be named as
additional insured on all such liability insurance policies of such Grantor and

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the Collateral
Trustee shall be named as loss payee on all property and machinery breakage insurance policies of
each Grantor.

          (c) Upon the request of any Secured Debt Representative or the Collateral Trustee, the Company
shall deliver to such Secured Debt Representative and/or the Collateral Trustee a report of a
reputable insurance broker with respect to such insurance and such supplemental reports with
respect thereto as the Collateral Trustee or any Secured Debt Representative may from time to time
reasonably request but, unless a Secured Debt Default shall have occurred and be continuing, not
more than once per fiscal year.

          5.4. Payment of Secured Obligations. Such Grantor shall pay and discharge or
otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all
taxes, assessments and governmental charges or levies imposed upon the Collateral or in respect of
income or profits therefrom, as well as all claims of any kind (including claims for labor,
materials and supplies) against or with respect to the Collateral, except that no such charge need
be paid if the amount or validity thereof is currently being contested in good faith by appropriate
proceedings, reserves in conformity with GAAP with respect thereto have been provided on the books
of such Grantor and such proceedings could not reasonably be expected to result in the sale,
forfeiture or loss of any material portion of the Collateral or any interest therein.

          5.5. Maintenance of Perfected Security Interest; Further Documentation. (a) Such
Grantor shall maintain each of the security interests created by this Agreement as a perfected
security interest having at least the priority described in Section 4.3 and shall defend such
security interest against the claims and demands of all persons whomsoever (other than the Secured
Parties), subject to the rights of such Grantor under the Secured Debt Documents to dispose of the
Collateral and subject to the provisions relating to the release of the Liens in the Secured Debt
Documents and the Collateral Trust Agreement.

          (b) Such Grantor shall furnish to the Collateral Trustee from time to time statements and
schedules further identifying and describing the Collateral and such other reports in connection
with the assets and property of such Grantor as the Collateral Trustee may reasonably request, all
in reasonable detail.

          (c) At any time and from time to time, upon the written request of the Collateral Trustee, and
at the sole expense of such Grantor, such Grantor shall promptly and duly authorize, execute and
deliver, and have recorded, such further instruments and documents and take such further actions as
the Collateral Trustee may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein
granted, including (i) the filing of any financing or continuation statements under the
Uniform Commercial Code (or other similar laws) in effect in any jurisdiction with respect to the
security interests created hereby and (ii) in the case of Investment Property, Deposit Accounts and
any other relevant Collateral, taking any actions necessary to enable the Collateral Trustee to
obtain “control” (within the meaning of the applicable Uniform Commercial Code) with respect
thereto, including executing and delivering and causing the relevant depositary bank or securities
intermediary to execute and deliver a Control Agreement (Deposit and Securities Accounts).

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          5.6. Changes in Location, Name, Jurisdiction of Incorporation, etc. Such Grantor
shall not, except upon 15 days’ prior written notice to the Collateral Trustee and delivery to the
Collateral Trustee of duly authorized and, where required, executed copies of (a) all additional
financing statements and other documents reasonably requested by the Collateral Trustee to maintain
the validity, perfection and priority of the security interests provided for herein and (b) if
applicable, a written supplement to Schedule 4.5 showing any additional location at which Inventory
or Equipment (other than mobile goods) with a value in excess of $250,000 shall be kept:

          (i) permit any of the Inventory or Equipment (other than mobile goods) with a value in
excess of $250,000 to be kept at a location other than those listed on Schedule 4.5;

          (ii) change its legal name, jurisdiction of organization or the location of its chief
executive office or sole place of business from that referred to in Section 4.4; or

          (iii) change its legal name, identity or structure to such an extent that any financing
statement filed by the Collateral Trustee in connection with this Agreement would become
misleading.

          5.7. Notices. Such Grantor shall advise the Collateral Trustee promptly, in
reasonable detail, of:

          (a) any Lien (other than any Lien expressly permitted under the Secured Debt Documents) on any
of the Collateral which would adversely affect the ability of the Collateral Trustee to exercise
any of its remedies hereunder; and

          (b) the occurrence of any other event which could reasonably be expected to have a material
adverse effect on the aggregate value of the Collateral or on the security interests created
hereby.

          5.8. Investment Property.
(a) If such Grantor shall become entitled to receive or shall receive any stock or other
ownership certificate (including any certificate representing a stock dividend or a distribution in
connection with any reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the Equity Interests of any
Issuer, whether in addition to, in substitution of, as a conversion of, or in exchange for, any
shares of or other ownership interests in the Pledged Securities, or otherwise in respect thereof,
such Grantor shall accept the same as the agent of the
Parties, hold the same in trust for
the Secured Parties and deliver the same forthwith to the Collateral Trustee in the exact form
received, duly endorsed by such Grantor to the Collateral Trustee, if required, together with an
undated stock power or similar instrument of transfer covering such certificate duly executed in
blank by such Grantor and with, if the Collateral Trustee so requests, signature guaranteed, to be
held by the Collateral Trustee, subject to the terms hereof, as additional collateral security for
the Secured
Obligations. Upon the occurrence and during the continuance of a Secured Debt Default,
any sums paid upon or in respect of the Pledged Securities upon the liquidation or dissolution of
any Issuer shall be paid over to the Collateral Trustee to be held by it hereunder as additional
collateral security for the Secured

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Obligations, and in case any distribution of capital shall be
made on or in respect of the Pledged Securities or any property shall be distributed upon or with
respect to the Pledged Securities pursuant to the recapitalization or reclassification of the
capital of any Issuer or pursuant to the reorganization thereof, the property so distributed shall,
unless otherwise subject to a perfected security interest in favor of the Collateral Trustee, be
delivered to the Collateral Trustee to be held by it hereunder as additional collateral security
for the Secured Obligations. If any sums of money or property so paid or distributed in respect of
the Pledged Securities shall be received by such Grantor, such Grantor shall, until such money or
property is paid or delivered to the Collateral Trustee, hold such money or property in trust for
the Secured Parties, segregated from other funds of such Grantor, as additional collateral security
for the Secured Obligations.

          (b) Without the prior written consent of the Collateral Trustee, such Grantor shall not (i)
vote to enable, or take any other action to permit, any Issuer to issue any stock, partnership
interests, limited liability company interests or other equity securities of any nature or to issue
any other securities convertible into or granting the right to purchase or exchange for any stock,
partnership interests, limited liability company interests or other equity securities of any nature
of any Issuer, except to the extent expressly permitted under the Secured Debt Documents, (ii)
sell, assign, transfer, exchange, or otherwise dispose of, or grant any option with respect to, any
of the Investment Property or Proceeds thereof or any interest therein (except, in each case,
pursuant to a transaction expressly permitted by the provisions of the Secured Debt Documents),
(iii) create, incur or permit to exist any Lien or option in favor of, or any claim of any Person
with respect to, any of the Investment Property or Proceeds thereof, or any interest therein,
except for the security interests created by this Agreement or any other security interests
permitted by the Secured Debt Documents, (iv) enter into any agreement or undertaking restricting
the right or ability of such Grantor or the Collateral Trustee to sell, assign or transfer any of
the Investment Property or Proceeds thereof or any interest therein or (v) without the prior
written consent of the Collateral Trustee, cause or permit any Issuer of any Pledged Partnership
Interests or Pledged LLC Interests which are not securities (for purposes of the New York UCC) on
the date hereof to elect or otherwise take any action to cause such Pledged Partnership Interests
or Pledged LLC Interests to be treated as securities for purposes of the New York UCC;
provided, however, notwithstanding the foregoing, if any issuer of any Pledged
Partnership Interests or Pledged LLC Interests takes any such action in violation of the provisions
in this
clause (v), such Grantor shall promptly notify the Collateral Trustee in writing of any such
election or action and, in such event, shall take all steps necessary or advisable to establish the
Collateral Trustee’s “control” thereof.

          (c) In the case of each Grantor which is an Issuer, such Issuer agrees that (i) it shall be
bound by the terms of this Agreement relating to the Pledged Securities issued by it and shall
comply with such terms insofar as such terms are applicable to it, (ii) it shall notify the
Collateral Trustee promptly in writing of the occurrence of any of the events described in Section
5.8(a) with respect to the Pledged Securities issued by it and (iii) the terms of Sections 6.3(c)
and 6.7 shall apply to it, mutatis mutandis, with respect to all actions that may
be required of it pursuant to Section 6.3(c) or 6.7 with respect to the Pledged Securities issued
by it. In addition, each Grantor which is either an Issuer or an owner of any Pledged Security
hereby consents to the grant by each other Grantor of the security interest hereunder in favor of
the Collateral Trustee and to the transfer of any Pledged Security to the Collateral Trustee or its
nominee

40

 

following a Secured Debt Default and to the substitution of the Collateral Trustee or its
nominee as a partner, member or shareholder of the Issuer of the related Pledged Security.

          5.9. Receivables. (a) Other than in the ordinary course of business consistent with
its past practice, such Grantor shall not (i) grant any extension of the time of payment of any
Receivable that is included in the Collateral, (ii) compromise or settle any Receivable for less
than the full amount thereof, (iii) release, wholly or partially, any Person liable for the payment
of any Receivable, (iv) allow any credit or discount whatsoever on any Receivable that is included
in the Collateral or (v) amend, supplement or modify any Receivable that is included in the
Collateral in any manner that could adversely affect the value thereof.

          (b) Such Grantor shall deliver to the Collateral Trustee a copy of each material demand,
notice or document received by it that questions or calls into doubt the validity or enforceability
of more than 7.5% of the aggregate amount of the then outstanding Receivables that are included in
the Collateral.

          (c) Each Grantor shall perform and comply in all material respects with all of its obligations
with respect to the Receivables that are included in the Collateral.

          (d) Each Grantor shall keep and maintain at its own cost and expense complete records of each
Receivable that is included in the Collateral, in a manner consistent with prudent business
practice, including records of all payments received, credits granted thereon, advances paid,
advances recouped, advances not recouped and all other documentation relating thereto.

          (e) Each Grantor shall legend, at the request of the Collateral Trustee made at any time after
the occurrence of any Secured Debt Default under any Secured Debt Document and in form and manner
reasonably satisfactory to the Collateral Trustee, the Receivables that
are included in the Collateral and the other books, records and documents of such Grantor
evidencing or pertaining to the Receivables that are included in the Collateral with an appropriate
reference to the fact that the Receivables that are included in the Collateral have been assigned
to the Collateral Trustee for the benefit of the Secured Parties and that the Collateral Trustee
has a security interest therein for the benefit of the Secured Parties.

          (f) No Grantor shall rescind or cancel any indebtedness evidenced by any Receivable that is
included in the Collateral or modify any term thereof or make any adjustment with respect thereto
except in the ordinary course of business consistent with prudent business practice, or extend or
renew any such indebtedness except in the ordinary course of business consistent with prudent
business practice or compromise or settle any dispute, claim, suit or legal proceeding relating
thereto or sell any Receivable that is included in the Collateral or interest therein except in the
ordinary course of business consistent with prudent business practice without the prior written
consent of the Collateral Trustee. Each Grantor shall timely fulfill all obligations on its part
to be fulfilled under or in connection with the Receivables that are included in the Collateral in
a manner consistent with Good Utility Practices.

          (g) Each Grantor shall cause to be collected from the account debtor of each of the
Receivables that are included in the Collateral, as and when due in the ordinary course of

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business
consistent with prudent business practice (including Receivables that are delinquent, such
Receivables that are included in the Collateral to be collected in accordance with generally
accepted commercial collection procedures), any and all amounts owing under or on account of such
Receivable that is included in the Collateral, and apply forthwith upon receipt thereof all such
amounts as are so collected to the outstanding balance of such Receivable, except that any Grantor
may, with respect to any Receivable that is included in the Collateral, allow in the ordinary
course of business such extensions of time to pay amounts due in respect of Receivables that are
included in the Collateral and such other modifications of payment terms or settlements in respect
of Receivables as shall be commercially reasonable under the circumstances, all in accordance with
such Grantor’s ordinary course of business consistent with its collection practices as in effect
from time to time. The costs and expenses (including attorneys’ fees) of collection, in any case,
whether incurred by any Grantor, the Collateral Trustee or any other Secured Party, shall be paid
by the Grantors.

          5.10. Contracts. (a) Such Grantor shall perform and comply in all material respects
with all its obligations under the Contracts.

          (b) Such Grantor shall not amend, modify, terminate, waive or fail to enforce any provision of
any Contract in any manner which could reasonably be expected to materially adversely affect the
value of the Collateral or otherwise have a Material Adverse Effect.

          (c) Such Grantor shall exercise promptly and diligently each and every material right which it
may have under each Material Contract (other than any right of termination).

          (d) Such Grantor shall deliver to the Collateral Trustee a copy of each material demand,
notice or document received by it relating in any way to any Material Contract and shall also
deliver to the Collateral Trustee a copy of all new Material Contracts entered into after the date
hereof.

          (e) With respect to any Non-Assignable Contract that is a Material Contract as of the date
hereof, each Grantor shall, within thirty days of the date hereof, request in writing the consent
of the counterparty or counterparties to such Non-Assignable Contract pursuant to the terms of such
Non-Assignable Contract or applicable law to the assignment or granting of a security interest in
such Non-Assignable Contract to the Collateral Trustee for the benefit of the Secured Parties and
use its commercially reasonable efforts to obtain such consent as soon as practicable thereafter.
No Grantor shall after the Restatement Date enter into any Non-Assignable Contract that is a
Material Contract unless, within 30 days, counterparties to such Non-Assignable Contract consent in
writing pursuant to the terms of such Non-Assignable Contract to the assignment and granting of a
security interest in such Non-Assignable Contract to the Collateral Trustee for the benefit of the
Secured Parties.

          (f) Such Grantor shall not permit to become effective in any document creating, governing or
providing for any permit, lease, license or Material Contract, a provision that would prohibit the
creation or perfection of, or exercise of remedies in connection with, a Lien on such permit,
lease, license or Material Contract in favor of the Collateral Trustee unless

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such Grantor
believes, in its reasonable judgment, that such prohibition is usual and customary in transactions
of such type.

          5.11. Intellectual Property. (a) Such Grantor (either itself or through licensees)
shall (i) continue to use each Trademark material to its business in order to maintain such
Trademark in full force free from any claim of abandonment for non-use, (ii) maintain as in the
past the quality of products and services offered under such Trademark and take all necessary steps
to ensure that all licensed users of such Trademark maintain as in the past such quality, (iii) use
such Trademark with the appropriate notice of registration and all other notices and legends
required by applicable Requirements of Law and (iv) not (and not permit any licensee or sublicensee
thereof to) do any act or knowingly omit to do any act whereby such Trademark may become
invalidated or impaired in any way.

          (b) Such Grantor (either itself or through licensees) shall not do any act, or omit to do any
act, whereby any Patent owned by such Grantor material to its business may become forfeited,
abandoned or dedicated to the public.

          (c) Such Grantor (either itself or through licensees) (i) shall employ each Copyright material
to its business and (ii) shall not (and shall not permit any licensee or sublicensee thereof to) do
any act or knowingly omit to do any act whereby any material portion of such Copyrights may become
invalidated or otherwise impaired. Such Grantor shall not (either itself or through licensees)
knowingly do any act whereby any material portion of such Copyrights may fall into the public
domain.

          (d) Such Grantor (either itself or through licensees) shall not do any act that uses any
Material Intellectual Property to infringe, misappropriate or violate the intellectual property
rights of any other Person.

          (e) Such Grantor (either itself or through licensees) shall use proper statutory notice in
connection with the use of the Material Intellectual Property.

          (f) Such Grantor shall notify the Collateral Trustee promptly if it knows, or has reason to
know, that any application or registration relating to any Material Intellectual Property may
become forfeited, abandoned or dedicated to the public, or of any adverse determination or
development (including the institution of, or any such determination or development in, any
proceeding in the United States Patent and Trademark Office, the United States Copyright Office or
any court or tribunal in any country) regarding such Grantor’s ownership of, or the validity of,
any Material Intellectual Property or such Grantor’s right to register the same or to own and
maintain the same in the case of Owned Intellectual Property.

          (g) Promptly upon such Grantor’s acquisition or creation of any invention, trademark or other
similar property that is material to the business of such Grantor, apply for registration thereof
with the United States Patent and Trademark Office and any other appropriate office. Whenever such
Grantor (either by itself or through any agent, employee, licensee or designee) shall file an
application for the registration of any Intellectual Property that is material to the business of
such Grantor with the United States Patent and Trademark Office or any similar office or agency in
any other country or any political subdivision thereof, such

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Grantor shall report such filing to
the Collateral Trustee within five Business Days after the last day of the fiscal quarter in which
such filing occurs. Upon request of the Collateral Trustee, such Grantor shall execute and
deliver, and have recorded, any and all agreements, instruments, documents, and papers as the
Collateral Trustee may request to evidence the Secured Parties’ security interest in any Patent,
Trademark or other Intellectual Property of such Grantor and the goodwill and general intangibles
of such Grantor relating thereto or represented thereby. Notwithstanding the foregoing, such
Grantor shall register with the U.S. Copyright Office copyrightable works only (i) if reasonably
requested by the Collateral Trustee or (ii) if the Collateral Trustee has been given at least 45
days prior notice and the opportunity to record with the U.S. Copyright Office an instrument
evidencing the Collateral Trustee’s security interest in such copyrighted works.

          (h) Such Grantor shall take all reasonable and necessary steps, including in any proceeding
before the United States Patent and Trademark Office, subject to the last sentence of the preceding
paragraph, the United States Copyright Office or any similar office or agency in any other country
or any political subdivision thereof, to maintain and pursue each application (and to obtain the
relevant registration) and to maintain each registration of
Intellectual Property material to its business, including the payment of required fees and
taxes, the filing of responses to office actions issued by the United States Patent and Trademark
Office and the United States Copyright Office, the filing of applications for renewal or extension,
the filing of affidavits of use and affidavits of incontestability, the filing of divisional,
continuation, continuation-in-part, reissue, and renewal applications or extensions, the payment of
maintenance fees, and the participation in interference, reexamination, opposition, cancellation,
infringement and misappropriation proceedings.

          (i) Such Grantor (either itself or through licensees) shall not, without the prior written
consent of the Collateral Trustee, discontinue use of or otherwise abandon any of its Intellectual
Property, or abandon any application or any right to file an application for letters patent,
trademark, or copyright, unless such Grantor shall have previously determined that such use or the
pursuit or maintenance of such Intellectual Property is no longer desirable in the conduct of such
Grantor’s business and that the loss thereof could not reasonably be expected to have a Material
Adverse Effect and, in which case, such Grantor shall give prompt notice of any such abandonment to
the Collateral Trustee in accordance herewith.

          (j) In the event that any Owned Intellectual Property material to its business is infringed,
misappropriated or diluted by a third party, such Grantor shall (i) take such actions as such
Grantor shall reasonably deem appropriate under the circumstances to protect such Intellectual
Property and (ii) if such Intellectual Property is of material economic value, promptly notify the
Collateral Trustee after it learns thereof and sue for infringement, misappropriation or dilution,
to seek injunctive relief where appropriate and to recover any and all damages for such
infringement, misappropriation or dilution.

          (k) Such Grantor agrees that, should it obtain an ownership interest in any item of
intellectual property which is not, as of the Restatement Date, a part of the Intellectual Property
Collateral (the “After-Acquired Intellectual Property”), (i) the provisions of Section 3
shall automatically apply thereto, (ii) any such After-Acquired Intellectual Property, and in the
case of trademarks, the goodwill of the business connected therewith or symbolized thereby,

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shall
automatically become part of the Intellectual Property Collateral, (iii) it shall give prompt (and,
in any event within five Business Days after the last day of the fiscal quarter in which such
Grantor acquires such ownership interest) written notice thereof to the Collateral Trustee in
accordance herewith and (iv) it shall provide the Collateral Trustee promptly (and, in any event
within five Business Days after the last day of the fiscal quarter in which such Grantor acquires
such ownership interest) with an amended Schedule 4.11 and take the actions specified in Section
5.11(m).

          (l) Such Grantor agrees to execute an Intellectual Property Security Agreement with respect to
its Intellectual Property in substantially the form of Exhibit D in order to record the security
interest granted herein to the Collateral Trustee for the benefit of the Secured Parties with the
United States Patent and Trademark Office, the United States Copyright Office and any other
applicable Governmental Authority.

          (m) Such Grantor agrees to execute an After-Acquired Intellectual Property Security Agreement
with respect to its After-Acquired Intellectual Property in substantially the form of Exhibit E in
order to record the security interest granted herein to the Collateral Trustee,
for the benefit of Secured Parties, with the United States Patent and Trademark Office, the
United States Copyright Office and any other applicable Governmental Authority.

          (n) Such Grantor shall take all steps reasonably necessary to protect the secrecy of all Trade
Secrets material to its business, including entering into confidentiality agreements with employees
and labeling and restricting access to secret information and documents.

          5.12. Commercial Tort Claims. Such Grantor shall advise the Collateral Trustee
promptly of any Commercial Tort Claim held by such Grantor individually or in the aggregate in
excess of $100,000 and shall promptly execute a supplement to this Agreement in form and substance
reasonably satisfactory to the Collateral Trustee to grant a security interest in such Commercial
Tort Claim to the Collateral Trustee for the benefit of the Secured Parties.

          5.13. Deposit and Securities Accounts. (a) On or prior to the Restatement Date, each
Grantor shall deliver to the Collateral Trustee one or more Control Agreements (Deposit and
Securities Accounts), executed by all parties thereto, for each Deposit Account and each Securities
Account that is included in the Collateral in which such Grantor has an interest as of the date
hereof (collectively, the “Pledged Accounts”); provided that no Grantor shall be
required at any time to enter into Control Agreements (Deposit and Securities Accounts) with
respect to any Deposit Account or Securities Account solely to the extent that the same constitutes
an Excluded Perfection Asset at such time. After the Restatement Date, each Grantor shall deliver
to the Collateral Trustee a Control Agreement (Deposit and Securities Accounts) for each Deposit
Account and each Securities Account in which such Grantor has an interest after the Restatement
Date; provided that no Grantor shall be required at any time to enter into a Control
Agreement with respect to any Deposit Account or Securities Account solely to the extent that the
same constitutes an Excluded Perfection Asset at such time. Each Grantor agrees that it shall have
no Deposit Account or Securities Accounts other than (i) Deposit Accounts and Securities Accounts
with respect to which Control Agreements (Deposit and Securities Accounts) have

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been delivered,
(ii) Deposit Accounts and Securities Accounts that constitute Excluded Perfection Interests and
(iii) Deposit Accounts that constitute Excluded Assets.

          (b) Each Grantor irrevocably authorizes the Collateral Trustee to notify each Depositary Bank
of the occurrence of an Actionable Default. Following the occurrence of an Actionable Default, the
Collateral Trustee may instruct each Depositary Bank to transfer immediately all funds and
investments held in each Deposit Account or Securities Account to an account designated by the
Collateral Trustee; provided, however, that the Collateral Trustee agrees that it
shall deliver such instruction only during the continuation of an Actionable Default. Each Grantor
hereby agrees to irrevocably direct each Depositary Bank to comply with the instructions of the
Collateral Trustee with respect to the applicable Deposit Account or Securities
Account held by such Depositary Bank without further consent from the Grantor or any other
Person.

          5.14. Collections. (a) Each Grantor agrees (i) to notify and direct promptly each
Account Debtor and every other Person obligated to make payments on Accounts that are included in
the Collateral or in respect of any Inventory that is included in the Collateral to make all such
payments directly to the Pledged Accounts established in accordance with Section 5.13, (ii) to use
all reasonable efforts to cause each Account Debtor and every other Person identified in clause (i)
above to make all payments with respect to Accounts that are included in the Collateral and
Inventory that is included in the Collateral directly to the Pledged Accounts and (iii) promptly to
deposit all payments received by it on account of Accounts that are included in the Collateral and
Inventory that is included in the Collateral, whether in the form of cash, checks, notes, drafts,
bills of exchange, money orders or otherwise, in the Pledged Accounts in precisely the form in
which received (but with any endorsements of such Grantor necessary for deposit or collection), and
until they are so deposited such payments shall be held in trust by such Grantor for the benefit
and as the property of the Secured Parties.

          (b) Without the prior written consent of the Collateral Trustee, no Grantor shall, in a manner
adverse to the Secured Parties, change the general instructions given to Account Debtors in respect
of payment on Accounts to be deposited in the Pledged Accounts. Until the Collateral Trustee shall
have advised the Grantors to the contrary, each Grantor shall, and the Collateral Trustee hereby
authorizes each Grantor to, enforce and collect all amounts owing on the Inventory and Accounts,
for the benefit and on behalf of the Collateral Trustee and the other Secured Parties;
provided, however, that such privilege may at the option of the Collateral Trustee
be terminated upon the occurrence and during the continuance of any Actionable Default.

SECTION 6. REMEDIAL PROVISIONS

          6.1. Certain Matters Relating to Receivables.

          (a) At any time after the occurrence and during the continuance of an Actionable Default, the
Collateral Trustee shall have the right, but shall in no way be obligated to make test
verifications of the Receivables that are included in the Collateral in any manner and through any
medium that it reasonably considers advisable, and each Grantor shall furnish all such assistance
and information as the Collateral Trustee may require in connection with such test verifications.

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At any time and from time to time after the occurrence and during the continuance of an Actionable
Default, upon the Collateral Trustee’s request and at the expense of the relevant Grantor, such
Grantor shall cause independent public accountants or others satisfactory to the Collateral Trustee
or the Administrative Agent, as agent for the Collateral Trustee, to furnish to
the Collateral Trustee or the Administrative Agent, as agent for the Collateral Trustee, as
the case may be, reports showing reconciliations, aging and test verifications of, and trial
balances for, the Receivables that are included in the Collateral.

          (b) Each Grantor may collect such Grantor’s Receivables that are included in the Collateral,
subject to the Collateral Trustee’s direction and control as defined in Section 5.13, and each
Grantor hereby agrees to continue to collect all amounts due or to become due to such Grantor under
the Receivables and any Supporting Obligation, in each case, that are included in the Collateral
and diligently exercise each material right it may have under any Receivable and any Supporting
Obligation, in each case, that are included in the Collateral at its own expense; provided,
however, that the Collateral Trustee may curtail or terminate said authority at any time
after the occurrence and during the continuance of an Actionable Default as provided in Section
5.13. If required by the Collateral Trustee at any time after the occurrence and during the
continuance of an Actionable Default, any payments of Receivables that are included in the
Collateral, when collected by any Grantor, (i) shall be forthwith (and, in any event, within two
Business Days) deposited by such Grantor in the exact form received, duly endorsed by such Grantor
to the Collateral Trustee for the benefit of the Secured Parties if required, in a Collateral
Account maintained under the sole dominion and control of the Collateral Trustee, subject to
withdrawal by the Collateral Trustee for the account of the Secured Parties only as provided in
Section 6.7, and (ii) until so turned over, shall be held by such Grantor in trust for the Secured
Parties, segregated from other funds of such Grantor. Each such deposit of Proceeds of Receivables
that are included in the Collateral shall be accompanied by a report identifying in reasonable
detail the nature and source of the payments included in the deposit.

          (c) At any time after the occurrence and during the continuance of an Actionable Default, at
the Collateral Trustee’s request, each Grantor shall deliver to the Collateral Trustee all original
and other documents evidencing, and relating to, the agreements and transactions which gave rise to
the Receivables that are included in the Collateral, including all original orders, invoices and
shipping receipts.

          6.2. Communications with Obligors; Grantors Remain Liable. (a) At any time after the
occurrence and during the continuance of an Actionable Default, the Collateral Trustee in its own
name or in the name of others may at any time communicate with obligors under the Receivables that
are included in the Collateral and parties to the Contracts to verify with them to the Collateral
Trustee’s reasonable satisfaction the existence, amount and terms of any Receivables or Contracts,
in each case, that are included in the Collateral.

          (b) The Collateral Trustee may at any time notify, or require any Grantor to so notify, the
Account Debtor or counterparty on any Receivable or Contract that is included in the Collateral of
the security interest of the Collateral Trustee therein. In addition, after the occurrence and
during the continuance of an Actionable Default, the Collateral Trustee may upon written notice to
the applicable Grantor, notify, or require any Grantor to notify, the

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Account Debtor or counterparty to make all payments under the Receivables and/or Contracts
that are included in the Collateral directly to the Collateral Trustee.

          (c) Anything herein to the contrary notwithstanding, each Grantor shall remain liable under
each of the Receivables and Contracts that are included in the Collateral to observe and perform
all the conditions and obligations to be observed and performed by it thereunder, all in accordance
with the terms of any agreement giving rise thereto. No Secured Party shall have any obligation or
liability under any Receivable (or any agreement giving rise thereto) or Contract that is included
in the Collateral by reason of or arising out of this Agreement or the receipt by any Secured Party
of any payment relating thereto, nor shall any Secured Party be obligated in any manner to perform
any of the obligations of any Grantor under or pursuant to any Receivable (or any agreement giving
rise thereto) or Contract that is included in the Collateral, to make any payment, to make any
inquiry as to the nature or the sufficiency of any payment received by it or as to the sufficiency
of any performance by any party thereunder, to present or file any claim, to take any action to
enforce any performance or to collect the payment of any amounts which may have been assigned to it
or to which it may be entitled at any time or times.

          6.3. Pledged Securities. (a) Unless an Actionable Default shall have occurred and be
continuing and the Collateral Trustee (subject to the terms of the Collateral Trust Agreement)
shall have given notice to the relevant Grantor of the Collateral Trustee’s intent to exercise its
rights pursuant to Section 6.3(b), each Grantor shall be permitted to receive all cash dividends
paid in respect of the Pledged Equity Interests and all payments made in respect of the Pledged
Notes, in each case paid in the normal course of business of the relevant Issuer and consistent
with past practice, to the extent permitted in each credit agreement, indenture or comparable
document constituting a Secured Debt Document, and to exercise all voting and corporate rights with
respect to the Pledged Securities; provided, however, that no vote shall be cast or
corporate or other ownership right exercised or other action taken which, in the Collateral
Trustee’s reasonable judgment, would materially impair the Collateral or which would be
inconsistent with or result in any violation of any provision of this Agreement or any Secured Debt
Document.

          (b) Each Grantor hereby authorizes and instructs each Issuer of any Investment Property
pledged by such Grantor hereunder to (i) comply with any instruction received by it from the
Collateral Trustee in writing that (x) states that an Actionable Default has occurred and is
continuing and (y) is otherwise in accordance with the terms of this Agreement and the Collateral
Trust Agreement, without any other or further instructions from such Grantor, and each Grantor
agrees that each Issuer shall be fully protected in so complying and (ii) upon delivery of any
notice to such effect pursuant to Section 6.3(a), pay any dividends or other payments with respect
to the Investment Property directly to the Collateral Trustee. In order to permit the Collateral
Trustee to exercise the voting and other consensual rights which it may be entitled to exercise
pursuant hereto and to receive all dividends and other distributions which it
may be entitled to receive hereunder each Grantor shall promptly execute and deliver (or cause
to be executed and delivered) to the Collateral Trustee all proxies, dividend payment orders and
other instruments as the Collateral Trustee may from time to time reasonably request and each
Grantor acknowledges that the Collateral Trustee may utilize the power of attorney set forth
herein.

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          (c) Each Grantor hereby authorizes and instructs each Issuer of any Pledged Securities pledged
by such Grantor hereunder to (i) comply with any instruction received by it from the Collateral
Trustee in writing that (x) states that an Actionable Default has occurred and is continuing and
(y) is otherwise in accordance with the terms of this Agreement and the Collateral Trust Agreement,
without any other or further instructions from such Grantor, and each Grantor agrees that each
Issuer shall be fully protected in so complying, and (ii) upon any such instruction following the
occurrence of an Actionable Default, pay any dividends or other payments with respect to the
Investment Property, including the Pledged Securities, directly to the Collateral Trustee.

          6.4. Intellectual Property; Grant of License. For the purpose of enabling the
Collateral Trustee, after the occurrence and during the continuance of an Actionable Default, to
exercise rights and remedies under this Section 6 at such time as the Collateral Trustee shall be
lawfully entitled to exercise such rights and remedies, and for no other purpose, each Grantor
hereby grants to the Collateral Trustee an irrevocable, non-exclusive license (exercisable without
payment of royalty or other compensation to such Grantor) to use, exploit, assign or license, after
the occurrence and during the continuance of an Actionable Default, any of the Intellectual
Property now owned or hereafter acquired by such Grantor, wherever the same may be located, through
any and all media, whether now existing or hereafter developed, throughout the world, including in
such license access to all media in which any of the licensed items may be recorded or stored and
to all computer programs used for the compilation or printout hereof.

          6.5. Intellectual Property Litigation and Protection.

          (a) Upon the occurrence and during the continuance of any Actionable Default (and subject to
the terms of the Collateral Trust Agreement), the Collateral Trustee shall have the right but shall
in no way be obligated to file applications for protection of the Intellectual Property and/or
bring suit in the name of any Grantor, the Collateral Trustee or the Secured Parties to protect or
enforce the Intellectual Property and any Intellectual Property License. In the event of such
suit, each Grantor shall, at the reasonable request of the Collateral Trustee, do any and all
lawful acts and execute any and all documents reasonably requested by the Collateral Trustee in aid
of such enforcement and the Grantors shall promptly reimburse and indemnify the Collateral Trustee
for all costs and expenses incurred by the Collateral Trustee in the exercise of its rights under
this Section 6.5 in accordance with Section 8.4 hereof. In the event that the Collateral Trustee
shall elect not to bring suit to enforce the Intellectual Property, each Grantor agrees, at the
reasonable request of the Collateral Trustee, to take all commercially reasonable actions
necessary, whether by suit, proceeding or other action, to prevent the
infringement, misappropriation, counterfeiting, unfair competition, dilution, diminution in
value of or other damage to any of the material Intellectual Property owned by such Grantor by
others and for that purpose agrees to diligently maintain any suit, proceeding or other action
against any Person so infringing necessary to prevent such infringement.

          (b) If an Actionable Default shall occur and be continuing, upon written demand from the
Collateral Trustee (subject to the terms of the Collateral Trust Agreement), each Grantor shall
grant, assign, convey or otherwise transfer to the Collateral Trustee or such Collateral Trustee’s
designee all of such Grantor’s right, title and interest in and to the

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Intellectual Property and
shall execute and deliver to the Collateral Trustee such documents as are necessary or appropriate
to carry out the intent and purposes of this Agreement.

          6.6. Proceeds to be Turned Over To Collateral Trustee. In addition to the rights of
the Secured Parties specified in Section 6.1 with respect to payments of Receivables that are
included in the Collateral, if an Actionable Default shall occur and be continuing, all Proceeds
received by any Grantor consisting of cash, cash equivalents, checks and other near-cash items
shall be held by such Grantor in trust for the Secured Parties, segregated from other funds of such
Grantor, and shall, forthwith upon receipt by such Grantor, be turned over to the Collateral
Trustee in the exact form received by such Grantor (duly endorsed by such Grantor to the Collateral
Trustee, if required by the Collateral Trustee). All Proceeds received by the Collateral Trustee
hereunder shall be held by the Collateral Trustee in a Collateral Account maintained under its sole
dominion and control. All Proceeds while held by the Collateral Trustee in a Collateral Account
(or by such Grantor in trust for the Secured Parties) shall continue to be held as collateral
security for all the Secured Obligations and shall not constitute payment thereof until applied as
provided in Section 6.7.

          6.7. Application of Proceeds. At such intervals as may be agreed upon by each
Borrower and the Collateral Trustee, or, if an Actionable Default shall have occurred and be
continuing, at any time at the Collateral Trustee’s election, the Collateral Trustee may apply all
or any part of Proceeds constituting Collateral realized through the exercise by the Collateral
Trustee of its remedies hereunder, whether or not held in any Collateral Account, in payment of the
Secured Obligations in accordance with the provisions of the Collateral Trust Agreement.

          6.8. Code and Other Remedies. (a) If an Actionable Default shall occur and be
continuing, the Collateral Trustee, on behalf of the Secured Parties, may exercise, in addition to
all other rights and remedies granted to them in this Agreement and in any other instrument or
agreement securing, evidencing or relating to the Secured Obligations, all rights and remedies of a
secured party under the New York UCC (whether or not the New York UCC applies to the affected
Collateral) or its rights under any other applicable law or in equity in each case subject to the
terms of the Collateral Trust Agreement. Without limiting the generality of the foregoing and in
each case subject to the terms of the Collateral Trust Agreement, the Collateral Trustee, without
demand of performance
or other demand, presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Grantor or any other Person (all and each of
which demands, defenses, advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof,
and/or may forthwith sell, lease, license, assign, give option or options to purchase, or otherwise
dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing),
in one or more parcels at public or private sale or sales, at any exchange, broker’s board or
office of the Collateral Trustee or any other Secured Party or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit
or for future delivery without assumption of any credit risk. The Collateral Trustee and each
other Secured Party shall have the right upon any such public sale or sales, and, to the extent
permitted by law, upon any such private sale or sales, to purchase the whole or any part of the
Collateral so sold, free of any right or equity of redemption in any Grantor, which right or equity
is hereby waived and released. Each purchaser at any such sale shall hold the property sold
absolutely free from any claim or right on the part of any Grantor,

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and each Grantor hereby waives
(to the extent permitted by applicable law) all rights of redemption, stay and/or appraisal which
it now has or may at any time in the future have under any rule of law or statute now existing or
hereafter enacted. Each Grantor agrees that, to the extent notice of sale shall be required by
law, at least ten days notice to such Grantor of the time and place of any public sale or the time
after which any private sale is to be made shall constitute reasonable notification. The
Collateral Trustee shall not be obligated to make any sale of Collateral regardless of notice of
sale having been given. The Collateral Trustee may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may, without further
notice, be made at the time and place to which it was so adjourned. In connection with any such
sale, the Collateral Trustee may sell the Collateral without giving any warranties as to the
Collateral. The Collateral Trustee may specifically disclaim or modify any warranties of title or
the like. This procedure will not be considered to adversely effect the commercial reasonableness
of any sale of the Collateral. In the exercise of its remedies, each Grantor agrees that it would
not be commercially unreasonable for the Collateral Trustee to dispose of the Collateral or any
portion thereof by using Internet sites that provide for the auction of assets of the types
included in the Collateral or that have the reasonable capability of doing so, or that match buyers
and sellers of assets. Each Grantor hereby waives any claims against the Collateral Trustee
arising by reason of the fact that the price at which any Collateral may have been sold at such a
private sale was less than the price which might have been obtained at a public sale, even if the
Collateral Trustee accepts the first offer received and does not offer such Collateral to more than
one offeree. Each Grantor further agrees, at the Collateral Trustee’s request, to assemble the
Collateral and make it available to the Collateral Trustee at places which the Collateral Trustee
shall reasonably select, whether at such Grantor’s premises or elsewhere. In the exercise of its
remedies, the Collateral Trustee shall have the right to enter onto the property where any
Collateral is located and take possession thereof with or without judicial process.

          (b) The Collateral Trustee shall apply the net proceeds of any action taken by it pursuant to
this Section 6.8, after deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any of the Collateral or in any
way relating to the Collateral or the rights of the Secured Parties hereunder, including reasonable
attorneys’ fees and disbursements, to the payment in whole or in part of the Secured Obligations in
accordance with the Collateral Trust Agreement. If the Collateral Trustee sells
any of the Collateral upon credit, the Grantor will be credited only with payments actually
made by purchaser and received by the Collateral Trustee and applied to indebtedness of the
purchaser. In the event the purchaser fails to pay for the Collateral, the Collateral Trustee may
resell the Collateral and the Grantor shall be credited with proceeds of the sale. To the extent
permitted by applicable law, each Grantor waives all claims, damages and demands it may acquire
against the Collateral Trustee or the other Secured Parties arising out of the exercise by them of
any rights hereunder.

          (c) In the event of any disposition of any of the Intellectual Property, the goodwill of the
business connected with and symbolized by any Trademarks subject to such disposition shall be
included, and the applicable Grantor shall supply the Collateral Trustee or its designee with such
Grantor’s know-how and expertise, and with documents and things embodying the same, relating to the
manufacture, distribution, advertising and sale of products or the provision of services relating
to any Intellectual Property subject to such disposition, and

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such Grantor’s customer lists and
other records and documents relating to such Intellectual Property and to the manufacture,
distribution, advertising and sale of such products and services.

          6.9. Registration Rights. (a) If the Collateral Trustee is directed to exercise its
right to sell any or all of the Pledged Equity Interests or the Pledged Debt Securities pursuant to
Section 6.8, and if the Collateral Trustee is so directed to have the Pledged Equity Interests or
the Pledged Debt Securities, or that portion thereof to be sold, registered under the provisions of
the Securities Act, the relevant Grantor shall cause the Issuer thereof to (i) execute and deliver,
and cause the directors and officers of such Issuer to execute and deliver, all such instruments
and documents, and do or cause to be done all such other acts as the Collateral Trustee determines
to be reasonably necessary or advisable to register the Pledged Equity Interests or the Pledged
Debt Securities, or that portion thereof to be sold, under the provisions of the Securities Act,
(ii) use its commercially reasonable efforts to cause the registration statement relating thereto
to become effective and to remain effective for a period of one year from the date of the first
public offering of the Pledged Equity Interests or the Pledged Debt Securities, or that portion
thereof to be sold and (iii) make all amendments thereto and/or to the related prospectus which, in
the opinion of the Collateral Trustee, are reasonably necessary or advisable, all in conformity
with the requirements of the Securities Act and the rules and regulations of the Securities and
Exchange Commission applicable thereto. Each Grantor agrees to use commercially reasonable efforts
to cause such Issuer to comply with the provisions of the securities or “Blue Sky” laws of any and
all jurisdictions which the Collateral Trustee shall designate and to make available to its
security holders, as soon as practicable, an earnings statement (which need not be audited) which
will satisfy the provisions of Section 11(a) of the Securities Act.

          (b) Each Grantor recognizes that the Collateral Trustee may be unable to effect a public sale
of any or all the Pledged Equity Interests or the Pledged Debt Securities, by reason of certain
prohibitions contained in the Securities Act and applicable state securities laws
or otherwise, and may be compelled to resort to one or more private sales thereof to a
restricted group of purchasers which will be obliged to agree, among other things, to acquire such
securities for their own account for investment and not with a view to the distribution or resale
thereof. Each Grantor acknowledges and agrees that any such private sale may result in prices and
other terms less favorable than if such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been made in a
commercially reasonable manner. The Collateral Trustee shall be under no obligation to delay a
sale of any of the Pledged Equity Interests or the Pledged Debt Securities for the period of time
necessary to permit the Issuer thereof to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if such Issuer would agree to do
so.

          (c) Each Grantor agrees to use its best efforts to do or cause to be done all such other acts
as may be necessary to make such sale or sales of all or any portion of the Pledged Equity
Interests or the Pledged Debt Securities pursuant to this Section 6.9 valid and binding and in
compliance with any and all other applicable Requirements of Law. Each Grantor further agrees that
a breach of any of the covenants contained in this Section 6.9 will cause irreparable injury to the
Secured Parties, that the Secured Parties have no adequate remedy at law in respect of such breach
and, as a consequence, that each and every covenant contained in this Section 6.9 shall be
specifically enforceable against such Grantor, and such Grantor hereby

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waives and agrees not to
assert any defenses against an action for specific performance of such covenants except for a
defense that no Actionable Default has occurred.

          6.10. Deficiency. Each Grantor shall remain liable for any deficiency if the proceeds
of any sale or other disposition of the Collateral are insufficient to pay its Obligations and the
fees and disbursements of any attorneys employed by any Secured Party to collect such deficiency.

          6.11. Separate Liens. The Collateral Trustee may exercise any or all of the rights
and remedies set forth in this Section 6 separately with respect to each security interest granted
hereunder or jointly, as directed by the relevant Secured Parties in accordance with the Collateral
Trust Agreement.

SECTION 7. THE COLLATERAL TRUSTEE

          7.1. Collateral Trustee’s Appointment as Attorney-in-Fact, etc. (a) Each Grantor
hereby irrevocably constitutes and appoints the Collateral Trustee and any officer or agent
thereof, with full power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of such Grantor and in the name of such
Grantor or in its own name, for the purpose of carrying out the terms of this Agreement, to take
any and all appropriate action and to execute any and all documents and instruments
which may be necessary or desirable to accomplish the purposes of this Agreement, and, without
limiting the generality of the foregoing, each Grantor hereby gives the Collateral Trustee the
power and right, on behalf of such Grantor, without notice to or assent by such Grantor, to do any
or all of the following:

               (i) in the name of such Grantor or its own name, or otherwise, take possession of and
endorse and collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due under any Receivable or Contract or with respect to any other
Collateral and file any claim or take any other action or proceeding in any court of law or
equity or otherwise deemed appropriate by the Collateral Trustee for the purpose of
collecting any and all such moneys due under any Receivable or Contract or with respect to
any other Collateral whenever payable;

               (ii) in the case of any Intellectual Property, execute and deliver, and have recorded,
any and all agreements, instruments, documents and papers as the Collateral Trustee may
request to evidence the Collateral Trustee’s security interest in such Intellectual Property
and the goodwill and general intangibles of such Grantor relating thereto or represented
thereby;

               (iii) pay or discharge taxes and Liens levied or placed on or threatened against the
Collateral, effect any repairs or any insurance called for by the terms of this Agreement
and pay all or any part of the premiums therefor and the costs thereof;

               (iv) execute, in connection with any sale provided for in Section 6.8 or 6.9, any
endorsements, assignments or other instruments of conveyance or transfer with respect to the
Collateral; and

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               (v) (1) direct any party liable for any payment under any of the Collateral to make
payment of any and all moneys due or to become due thereunder directly to the Collateral
Trustee or as the Collateral Trustee shall direct; (2) ask or demand for, collect, and
receive payment of and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral; (3) sign and endorse
any invoices, freight or express bills, bills of lading, storage or warehouse receipts,
drafts against debtors, assignments, verifications, notices and other documents in
connection with any of the Collateral; (4) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect of any
Collateral; (5) defend any suit, action or proceeding brought against such Grantor with
respect to any Collateral; (6) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, give such discharges or releases as the Collateral
Trustee may deem appropriate; (7) assign any Copyright, Patent or Trademark (along with the
goodwill of the business to which any such Copyright, Patent or Trademark pertains),
throughout the world for such term or terms, on such conditions, and in such manner, as the
Collateral Trustee shall determine; and (8) generally, sell, transfer, pledge and make any
agreement with respect to or otherwise deal with any of the Collateral as fully and
completely as though the Collateral Trustee were the absolute owner thereof for all
purposes, and do, at the Collateral Trustee’s option and such
Grantor’s expense, at any time, or from time to time, all acts and things which the
Collateral Trustee deems necessary to protect, preserve or realize upon the Collateral and
the Collateral Trustee’s security interests therein and to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.

          Anything in this Section 7.1(a) to the contrary notwithstanding, the Collateral Trustee agrees
that it will not exercise any rights under the power of attorney provided for in this Section
7.1(a) unless an Actionable Default shall have occurred and be continuing, and in accordance with
the Collateral Trust Agreement.

          (b) If any Grantor fails to perform or comply with any of its agreements contained herein, the
Collateral Trustee, at its option, but without any obligation so to do, may perform or comply, or
otherwise cause performance or compliance, with such agreement.

          (c) The expenses of the Collateral Trustee incurred in connection with actions undertaken as
provided in this Section 7.1, together with interest thereon at the rate applicable under Section
2.06 of the Credit Agreement, from the date of payment by the Collateral Trustee to the date
reimbursed by the relevant Grantor, shall be payable by such Grantor to the Collateral Trustee on
demand.

          (d) Each Grantor hereby ratifies all that said attorneys set forth in this Section 7.1 shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.

          7.2. Duty of Collateral Trustee. The Collateral Trustee’s sole duty with respect to
the custody, safekeeping and physical preservation of the Collateral in its possession, under

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Section 9-207 of the New York UCC or otherwise, shall be to deal with it in the same
manner as the Collateral Trustee deals with similar property for its own account. Neither the
Collateral Trustee, nor any other Secured Party nor any of their respective officers, directors,
partners, employees, agents, attorneys and other advisors, attorneys-in-fact or Affiliates shall be
liable for failure to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the
request of any Grantor or any other Person or to take any other action whatsoever with regard to
the Collateral or any part thereof. The powers conferred on the Collateral Trustee and the other
Secured Parties hereunder are solely to protect the Secured Parties’ interests in the Collateral
and shall not impose any duty upon any Secured Party to exercise any such powers. The Secured
Parties shall be accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors, partners,
employees, agents, attorneys and other advisors, attorneys-in-fact or Affiliates shall be
responsible to any Grantor for any act or failure to act hereunder, except to the extent that any
such act or failure to act is found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from their own gross negligence or willful misconduct.

          Notwithstanding anything to the contrary contained in this Agreement, the rights, privileges,
powers, benefits and immunities of the Collateral Trustee hereunder are subject to the terms,
conditions and limitations set forth in the Collateral Trust Agreement, reference to which is made
for all purposes; provided, however, that any forbearance by the Collateral Trustee
in exercising any right or remedy available to it under the Collateral Trust Agreement shall not
give rise to a defense on the part of the Grantors with respect to the Collateral Trustee’s
exercise of any right or remedy pursuant to this Agreement or as otherwise afforded by applicable
law.

          7.3. Execution of Financing Statements. Each Grantor acknowledges that pursuant to
Section 9-509(b) of the New York UCC and any other applicable law, each Grantor authorizes the
Collateral Trustee to file or record financing or continuation statements, and amendments thereto,
and other filing or recording documents or instruments with respect to the Collateral, without the
signature of such Grantor, in such form and in such offices as the Collateral Trustee reasonably
determines appropriate to perfect or maintain the perfection of the security interests of the
Collateral Trustee under this Agreement. Each Grantor agrees that such financing statements may
describe the collateral in the same manner as described in the Security Documents or as “all
assets” or “all personal property”, wherever located and whether now owned or hereafter existing or
acquired or such other description as the Collateral Trustee, in its sole judgment, determines is
necessary or advisable. A photographic or other reproduction of this Agreement shall be sufficient
as a financing statement or other filing or recording document or instrument for filing or
recording in any jurisdiction. Each Grantor hereby ratifies and authorizes the filing by or on
behalf of the Collateral Trustee of any financing statement with respect to the Collateral made
prior to the date hereof.

          7.4. Authority of Collateral Trustee. Each Grantor acknowledges that the rights and
responsibilities of the Collateral Trustee under this Agreement with respect to any action taken by
the Collateral Trustee or the exercise or non-exercise by the Collateral Trustee of any option,
voting right, request, judgment or other right or remedy provided for herein or resulting or
arising out of this Agreement shall, as between the Collateral Trustee and the other Secured
Parties, be governed by the Collateral Trust Agreement and by such other agreements

55

 

with respect thereto as may exist from time to time among them, but, as between the Collateral
Trustee and the Grantors, the Collateral Trustee shall be conclusively presumed to be acting as
agent for the Secured Parties, in its capacities as further described in the Collateral Trust
Agreement, and with full and valid authority so to act or refrain from acting, and no Grantor shall
be under any obligation, or entitlement, to make any inquiry respecting such authority.
Notwithstanding anything to the contrary contained herein, in taking any action hereunder the
Collateral Trustee shall not be required to act except to the extent that it shall have been
directed in writing to so act by a Secured Debt Representative; provided that all actions
of the Collateral Trustee hereunder shall be taken pursuant to the terms of the Collateral Trust
Agreement and the Collateral Trustee shall act to the extent directed pursuant to the terms thereof
with respect to those matters specified therein.

          7.5. Access to Collateral, Books and Records; Other Information. Upon reasonable
request to any Grantor, representatives of the Collateral Trustee or any other Secured Party
(acting through the applicable Secured Debt Representative) shall have full and free access to
visit and inspect, as applicable, during normal business hours all of the Collateral of such
Grantor, including all of the books, correspondence and records of such Grantor relating thereto;
provided that no Grantor shall be required to provide such access more than two times in
any fiscal year, unless an Actionable Default shall have occurred and be continuing. The
Collateral Trustee and its representatives may examine the same, take extracts therefrom and make
photocopies thereof, and such Grantor agrees to render to the Collateral Trustee, at such Grantor’s
cost and expense, such clerical and other assistance as may be reasonably requested by the
Collateral Trustee with regard thereto. Such Grantor shall, at any and all times, within a
reasonable time after written request by the Collateral Trustee, furnish or cause to be furnished
to the Collateral Trustee, in such manner and in such detail as may be reasonably requested by the
Collateral Trustee, additional information with respect to the Collateral.

          7.6. Appointment of Co-Collateral Agents. At any time or from time to time, in order
to comply with any Requirement of Law, the Collateral Trustee may appoint another bank or trust
company or one of more other persons, either to act as co-agent or agents on behalf of the Secured
Parties with such power and authority as may be necessary for the effectual operation of the
provisions hereof and which may be specified in the instrument of appointment. Each separate
trustee or co-trustee, upon its acceptance of the trusts conferred, shall be vested with the
estates or property specified in its instrument of appointment, either jointly with the Collateral
Trustee or separately, as may be provided therein, subject to all the provisions of the Collateral
Trust Agreement and the other Security Documents, specifically including every provision of such
agreements relating to the conduct of, affecting the liability of, or affording protection to, the
Collateral Trustee. A copy of every such instrument shall be sent to the Collateral Trustee.

SECTION 8. MISCELLANEOUS

          8.1. Amendments in Writing. None of the terms or provisions of this Agreement may be
waived, amended, supplemented or otherwise modified except in accordance with Section 7.1 of the
Collateral Trust Agreement.

56

 

          8.2. Notices. All notices, requests and demands to or upon the Collateral Trustee or
any Grantor hereunder shall be effected in the manner provided for in Section 7.5 of the Collateral
Trust Agreement; provided that any such notice, request or demand to or upon any Guarantor
shall be addressed to such Guarantor at its notice address set forth on Schedule 8.2 or such other
address specified in writing to the Collateral Trustee in accordance with such Section. Each
Grantor agrees to provide a copy of each notice provided by it hereunder to the Collateral Trustee
to each Secured Debt Representative in the manner provided for in Section 7.1 of the Collateral
Trust Agreement.

          8.3. No Waiver by Course of Conduct; Cumulative Remedies. Neither the Collateral
Trustee nor any other Secured Party shall by any act (except by a written instrument pursuant to
Section 8.1), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any Secured Debt Default under any Secured Debt Document. No
failure to exercise, nor any delay in exercising, on the part of the Collateral Trustee or any
other Secured Party, any right, power or privilege hereunder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege. A waiver by the
Collateral Trustee or any other Secured Party of any right or remedy hereunder on any one occasion
shall not be construed as a bar to any right or remedy which such Secured Party would otherwise
have on any future occasion. The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or remedies provided by
law.

          8.4. Enforcement Expenses; Indemnification. (a) Each Grantor agrees to pay or
reimburse the Collateral Trustee and each Secured Party for all its costs and expenses incurred in
collecting against such Grantor under the guarantee contained in Section 2 or otherwise enforcing
or preserving any rights under this Agreement and the Secured Debt Documents to which such Grantor
is a party, including the fees and disbursements of counsel to the Collateral Trustee and each
Secured Party.

          (b) Each Grantor agrees to pay, and to save the Collateral Trustee and the other Secured
Parties harmless from, any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect
to, or resulting from any delay in paying, any and all stamp, excise, sales or other taxes which
may be payable or determined to be payable with respect to any of the Collateral or in connection
with any of the transactions contemplated by this Agreement.

          (c) Each Grantor agrees to pay, and to save the Collateral Trustee and the other Secured
Parties harmless from, any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to
the execution, delivery, enforcement, performance and administration of this Agreement to the
extent each Credit Agreement Borrower would be required to do so pursuant to Section 9.05 of the
Credit Agreement (whether or not then in effect), if the Collateral Trustee were acting as the
Administrative Agent under the Credit Agreement.

          (d) The agreements in this Section shall survive repayment of the Secured Obligations and all
other amounts payable under the Secured Debt Documents.

57

 

          8.5. Successors and Assigns. This Agreement shall be binding upon the successors and
assigns of each Grantor and shall inure to the benefit of the Collateral Trustee and the other
Secured Parties and their successors and assigns; provided that no Grantor may assign,
transfer or delegate any of its rights or obligations under this Agreement without the prior
written consent of the Collateral Trustee, and any attempted assignment without such consent shall
be null and void.

          8.6. Set-Off. Each Grantor hereby irrevocably authorizes each Secured Party at any
time and from time to time, without notice to such Grantor or any other Grantor, any such notice
being expressly waived by each Grantor, to set-off and appropriate and apply any and all deposits
(general or special, time or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by each Secured Party to or for the
credit or the account of such Grantor, or any part thereof in such amounts as each Secured Party
may elect, against and on account of the obligations and liabilities of such Grantor to each
Secured Party hereunder and claims of every nature and description of each Secured Party against
such Grantor, in any currency, whether arising hereunder, under any other Secured Debt Document or
otherwise, as each Secured Party may elect, whether or not each Secured Party has made any demand
for payment and although such obligations, liabilities and claims may be contingent or unmatured,
provided that each such set-off and appropriation by any Secured Party shall be held by it
and applied in accordance with the terms of the Collateral Trust Agreement. The applicable Secured
Party shall notify such Grantor promptly of any such set-off and the application made by each
Secured Party of the proceeds thereof, provided that the failure to give such notice shall
not affect the validity of such set-off and application. The rights of each Secured Party under
this Section are in addition to other rights and remedies (including other rights of set-off) which
each Secured Party may have.

          8.7. Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts (including by facsimile), and all of said
counterparts taken together shall be deemed to constitute one and the same instrument.

          8.8. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

          8.9. Section Headings. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.

          8.10. Integration. This Agreement and each of the other Secured Debt Documents
represent the agreement of the Grantors, the Collateral Trustee and the other Secured Parties with
respect to the subject matter hereof and thereof, and there are no promises, undertakings,
representations or warranties by any Secured Party relative to subject matter hereof and thereof
not expressly set forth or referred to herein or in any of the other Secured Debt Documents.

58

 

          8.11. APPLICABLE LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

          8.12. Submission to Jurisdiction; Waivers. Each Grantor hereby irrevocably and
unconditionally:

     (a) submits for itself and its property in any legal action or proceeding relating to
this Agreement and the other Secured Debt Documents to which it is a party, or for
recognition and enforcement of any judgment in respect thereof, to the non-exclusive general
jurisdiction of the Courts of the State of New York, the courts of the United States of
America for the Southern District of New York, and appellate courts from any thereof;

     (b) consents that any such action or proceeding may be brought in such courts and
waives any objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;

     (c) agrees that service of process in any such action or proceeding may be effected by
mailing a copy thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to such Grantor at its address referred to in Section 8.2 or at such
other address of which the Collateral Trustee and the Secured Debt Representatives shall
have been notified pursuant thereto;

     (d) agrees that nothing herein shall affect the right to effect service of process in
any other manner permitted by law or shall limit the right to sue in any other jurisdiction;
and

     (e) waives, to the maximum extent not prohibited by law, any right it may have to claim
or recover in any legal action or proceeding referred to in this Section any special,
exemplary, punitive or consequential damages.

          8.13. Acknowledgments. Each Grantor hereby acknowledges that:

          (a) it has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Secured Debt Documents to which it is a party;

          (b) no Secured Party has any fiduciary relationship with or duty to any Grantor arising out of
or in connection with this Agreement or any of the other Secured Debt Documents, and the
relationship between the Grantors, on the one hand, and the Collateral Trustee and the other
Secured Parties, on the other hand, in connection herewith or therewith is solely that of debtor
and creditor; and

          (c) no joint venture is created hereby or by the Secured Debt Documents or otherwise exists by
virtue of the transactions contemplated hereby among the Secured Parties or among the Grantors and
the Secured Parties.

59

 

          8.14. Additional Grantors. Each Subsidiary of the Company that is required to become
a party to this Agreement pursuant to any Secured Debt Document shall become a Grantor and a
Guarantor for all purposes of this Agreement upon execution and delivery by such Subsidiary of an
Assumption Agreement in the form of Annex 1.

          8.15. Releases. (a) All or any portion of the Collateral shall be released from the
Liens created hereby, and the Guarantee of any Guarantor under this Agreement shall terminate, in
each case as provided in Section 4.1 of the Collateral Trust Agreement.

          (b) In the event of any sale or other disposition of all of the Equity Interests in any
Guarantor to a Person that is not (either before or after giving effect to such transactions) the
Company or a Subsidiary, then such Guarantor will be released and relieved of any obligations under
its Guarantee; provided that the proceeds of such sale or other disposition are applied in
accordance with the applicable provisions of all applicable Secured Debt Documents. Upon delivery
by the Company to each applicable Guaranteed Secured Debt Representative of an officer’s
certificate and an opinion of counsel to the effect that such sale or other disposition was made by
the Company or any applicable Subsidiary in accordance with the provisions of all of the applicable
Secured Debt Documents, such Guaranteed Secured Debt Representative will execute any documents
reasonably required in order to evidence the release of any Guarantor from its obligations under
its Guarantee.

          (c) In addition to the foregoing, the Guarantee of any Guarantor under this Agreement with
respect to any Series of Guaranteed Secured Debt shall terminate to the extent such termination is
provided for in the applicable Secured Debt Documents governing such Series of Guaranteed Secured
Debt.

          8.16. Conflicts. In the case of any conflicts between this Agreement and the
Collateral Trust Agreement, the provisions of the Collateral Trust Agreement shall govern and
control.

          8.17. WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
SECURED DEBT DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

          8.18. Additional Guaranteed Secured Debt Representatives. Each Guaranteed Secured
Debt Representative that becomes entitled to the benefits of the Collateral Trust Agreement after
the date hereof in accordance with the terms thereof shall become a party to this Agreement for
purposes of Section 2.

          8.19. Rights and Immunities of Secured Debt Representatives. The Administrative Agent
shall be entitled to all of the rights, protections, immunities and indemnities set forth in the
Credit Agreement, the Trustee shall be entitled to all of the rights, protections, immunities and
indemnities set forth in the Indenture and any future Secured Debt Representative shall be entitled
to all of the rights, protections, immunities and indemnities set forth in the credit agreement,
indenture or other agreement governing the applicable Secured Debt with respect to which such
Person shall act as representative, in each case as if specifically

60

 

set forth herein. In no event shall any Secured Debt Representative be liable for any act or
omission on the part of the Grantors or the Collateral Trustee hereunder.

[Remainder of page intentionally left blank]

61

 

          IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee and Collateral Agreement
to be duly executed and delivered as of the date first above written.

	 	 	 	 	 
	 	 	NRG ENERGY, INC.
	 
	 	 	 	 
	

	 	By:
	 	/s/ George P. Schaefer
	

	 	 	 	 
	

	 	 	 	Name: George P. Schaefer
	

	 	 	 	Title: Treasurer
	 
	 	 	 	 
	 	 	NRG POWER MARKETING INC.
	 
	 	 	 	 
	

	 	By:
	 	/s/ George P. Schaefer
	

	 	 	 	 
	

	 	 	 	Name: George P. Schaefer
	

	 	 	 	Title: Treasurer

(signatures continue on next page)

62

 

	 	 	 
	

	 	The Guarantors:
	 
	 	 
	

	 	ARTHUR KILL POWER LLC
	

	 	ASTORIA GAS TURBINE POWER LLC
	

	 	BERRIANS I GAS TURBINE POWER LLC
	

	 	BIG CAJUN II UNIT 4 LLC
	

	 	CAMAS POWER BOILER, INC.
	

	 	CAPISTRANO COGENERATION COMPANY
	

	 	CHICKAHOMINY RIVER ENERGY CORP.
	

	 	COMMONWEALTH ATLANTIC POWER LLC
	

	 	CONEMAUGH POWER LLC
	

	 	CONNECTICUT JET POWER LLC
	

	 	DEVON POWER LLC
	

	 	DUNKIRK POWER LLC
	

	 	EASTERN SIERRA ENERGY COMPANY
	

	 	EL SEGUNDO POWER II LLC
	

	 	ENERGY NATIONAL, INC.
	

	 	ENIFUND, INC.

	

	 	
ENIGEN, INC.
	

	 	ESOCO MOLOKAI, INC.
	

	 	ESOCO, INC.
	

	 	GRANITE II HOLDING, LLC
	

	 	HANOVER ENERGY COMPANY
	

	 	HUNTLEY POWER LLC
	

	 	INDIAN RIVER ROPERATIONS INC.
	

	 	INDIAN RIVER POWER LLC
	

	 	JAMES RIVER POWER LLC
	

	 	KEYSTONE POWER LLC
	

	 	LOUISIANA GENERATING LLC
	

	 	LS POWER MANAGEMENT LLC
	

	 	MERIDEN GAS TURBINES LLC
	

	 	MIDATLANTIC GENERATION HOLDING LLC
	

	 	MIDDLETOWN POWER LLC
	

	 	MONTVILLE POWER LLC
	 
	 	 
	

	 	Executing this Agreement on behalf of and so as to
bind each of the persons named above under the
caption “The Guarantors”

	 	 	 	 	 	 	 
	

	 	By:
	 	     /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer	 	 
	

	 	 	 	Title: Treasurer	 	 

(signatures continue on next page)

63

 

	 	 	 
	

	 	The Guarantors:
	 
	 	 
	

	 	NEO CALIFORNIA POWER LLC
	

	 	NEO CHESTER-GEN LLC
	

	 	NEO CORPORATION
	

	 	NEO FREEHOLD-GEN LLC
	

	 	NEO LANDFILL GAS HOLDINGS INC.
	

	 	NEO POWER SERVICES, INC.
	

	 	NEO-MONTAUK GENCO MANAGEMENT LLC
	

	 	NORTHEAST GENERATION HOLDINGS LLC
	

	 	NORWALK POWER LLC
	

	 	NRG AFFILIATE SERVICES INC.
	

	 	NRG ARTHUR KILL OPERATIONS, INC.
	

	 	NRG ASIA-PACIFIC, LTD.
	

	 	NRG ASTORIA GAS TURBINE OPERATIONS INC.
	

	 	NRG BAYOU COVE LLC
	

	 	NRG BRAZOS VALLEY GP LLC
	

	 	NRG BRAZOS VALLEY LP LLC
	

	 	NRG BOURBONNAISE EQUIPMENT LLC
	

	 	NRG BOURBONAISE LLC
	

	 	NRG CALIFORNIA PEAKER OPERATIONS LLC
	

	 	NRG CABRILLO POWER OPERATIONS INC.
	

	 	NRG CADILLAC OPERATIONS INC.
	

	 	NRG CENTRAL U.S. LLC
	

	 	NRG COMLEASE LLC
	

	 	NRG CONNECTICUT AFFILIATE SERVICES INC.
	 
	 	 
	

	 	Executing this Agreement on behalf of and so as to
bind each of the persons named above under the
caption “The Guarantors”

	 	 	 	 	 	 	 
	

	 	By:
	 	     /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer	 	 
	

	 	 	 	Title: Treasurer	 	 

(signatures continue on next page)

64

 

	 	 	 
	

	 	The Guarantors:
	 
	 	 
	

	 	NRG DEVELOPMENT COMPANY INC.
	

	 	NRG DEVON OPERATIONS INC.
	

	 	NRG DUNKIRK OPERATIONS INC.
	

	 	NRG EASTERN LLC
	

	 	NRG EL SEGUNDO OPERATIONS INC.
	

	 	NRG ENERGY JACKSON VALLEY I, INC.
	

	 	NRG ENERGY JACKSON VALLEY II, INC.
	

	 	NRG GRANITE ACQUISITIONS LLC
	

	 	NRG HUNTLEY OPERATIONS INC.
	

	 	NRG ILION LP LLC
	

	 	NRG INTERNATIONAL LLC
	

	 	NRG INTERNATIONAL III, INC.
	

	 	NRG KAUFMAN LLC
	

	 	NRG LATIN AMERICA INC.
	

	 	NRG MARKETING SERVICES LLC
	

	 	NRG MESQUITE LLC
	

	 	NRG MEXTRANS INC.
	

	 	NRG MIDATLANTIC AFFILIATE SERVICES INC.
	

	 	NRG MIDATLANTIC GENERATING LLC
	

	 	NRG MIDATLANTIC LLC
	

	 	NRG MIDDLETOWN OPERATIONS INC.
	

	 	NRG MONTVILLE OPERATIONS INC.
	

	 	NRG NEW JERSEY ENERGY SALES LLC
	

	 	NRG NEW ROADS HOLDINGS LLC
	

	 	NRG NORTH CENTRAL OPERATIONS INC.
	

	 	NRG NORTHEAST AFFILIATE SERVICES, INC.
	

	 	NRG NORTHEAST GENERATING LLC
	

	 	NRG NORWALK HARBOR OPERATIONS INC.
	

	 	NRG OPERATING SERVICES, INC.
	

	 	NRG OSWEGO HARBOR POWER OPERATIONS INC.
	

	 	NRG PACGEN INC.
	

	 	NRG PROCESSING SOLUTIONS LLC.
	 
	 	 
	

	 	Executing this Agreement on behalf of and so as to
bind each of the persons named above under the
caption “The Guarantors”

	 	 	 	 	 	 	 
	

	 	By:
	 	     /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer	 	 
	

	 	 	 	Title: Treasurer	 	 

(signatures continue on next page)

65

 

	 	 	 
	

	 	The Guarantors:
	 
	 	 
	

	 	NRG ROCKFORD ACQUISITION LLC
	

	 	NRG ROCKFORD EQUIPMENT LLC
	

	 	NRG ROCKY ROAD LLC
	

	 	NRG SAGUARO OPERATIONS INC.
	

	 	NRG SERVICES CORPORATION
	

	 	NRG SOUTH CENTRAL AFFILIATE SERVICES INC.
	

	 	NRG SOUTH CENTRAL GENERATING LLC
	

	 	NRG SOUTH CENTRAL OPERATIONS INC.
	

	 	NRG TELOGIA POWER LLC
	

	 	NRG WEST COAST LLC
	

	 	NRG WESTERN AFFILIATE SERVICES INC.
	

	 	O’BRIEN COGENERATION, INC.II
	

	 	ONSITE ENERGY, INC.
	

	 	OSWEGO HARBOR POWER LLC
	

	 	PACIFIC CROCKETT HOLDINGS, INC.
	

	 	PACIFIC GENERATION COMPANY
	

	 	PACIFIC GENERATION HOLDINGS COMPANY
	

	 	PACIFIC-MT. POSO CORPORATION
	

	 	SAGUARO POWER LLC
	

	 	SAN JOAQUIN VALLEY ENERGY I, INC.
	

	 	SAN JOAQUIN VALLEY ENERGY IV, INC.
	

	 	SOMERSET OPERATIONS INC.
	

	 	SOMERSET POWER LLC
	

	 	SOUTH CENTRAL GENERATION HOLDING LLC
	

	 	TACOMA ENERGY RECOVERY COMPANY
	

	 	TELOGIA POWER INC.
	

	 	VIENNA OPERATIONS INC.
	

	 	VIENNA POWER LLC.
	 
	 	 
	

	 	Executing this Agreement on behalf of and so as to
bind each of the persons named above under the
caption “The Guarantors”

	 	 	 	 	 	 	 
	

	 	By:
	 	     /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer	 	 
	

	 	 	 	Title: Treasurer	 	 

(signatures continue on next page)

66

 

	 	 	 	 	 	 	 
	 	 	GRANITE POWER PARTNERS II, L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: NRG Granite Acquisition LLC	 	 
	 	 	Its: General Partner	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	       /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer

Title: Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	KAUFMAN COGEN LP	 	 
	 
	 	 	 	 	 	 
	 	 	By: NRG Kaufman LLC	 	 
	 	 	Its: General Partner	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	       /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer	 	 
	

	 	 	 	Title: Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	NRG ILION LIMITED PARTNERSHIP	 	 
	 
	 	 	 	 	 	 
	 	 	By: NRG Rockford Acquisition LLC	 	 
	 	 	Its: General Partner	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	       /s/ George Schaefer	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: George Schaefer	 	 
	

	 	 	 	Title: Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	NRGENERATING HOLDINGS (NO. 21) B.V.	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	       /s/ Robert Henry	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: Robert Henry	 	 
	

	 	 	 	Title: Director	 	 

(signatures continue on next page)

67

 

	 	 	 	 	 	 	 
	 	 	DEUTSCHE BANK TRUST COMPANY
	 	 	AMERICAS, as Priority Collateral Trustee and
	 	 	Parity Collateral Trustee
	 
	 	 	 	 	 	 
	

	 	By:
	 	      /s/ Richard L. Buckwalter	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: Richard L. Buckwalter	 	 
	

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	     /s/ Irina Golovashchuk	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: Irina Golovashchuk	 	 
	

	 	 	 	Title: Associate	 	 

(signatures continue on next page)

68

 

	 	 	 	 	 	 	 
	 	 	CREDIT SUISSE FIRST BOSTON,
	 	 	acting through its Cayman Islands Branch, as the
	 	 	Administrative Agent
	 
	 	 	 	 	 	 
	

	 	By:
	 	     /s/ Jay Chall	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: Jay Chall	 	 
	

	 	 	 	Title: Director	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	     /s/ Denise L. Alvarez	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: Denise L. Alvarez	 	 
	

	 	 	 	Title: Associate	 	 

69

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