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EXHIBIT 1.1
EXECUTION COPY
NRG NORTHEAST GENERATING LLC
$320,000,000 8.065% Series A Senior Secured Bonds due 2004
$130,000,000 8.842% Series B Senior Secured Bonds due 2015
$300,000,000 9.292% Series C Senior Secured Bonds due 2024
PURCHASE AGREEMENT
February 15, 2000
CHASE SECURITIES INC.
SALOMON SMITH BARNEY INC.
On behalf of the Initial Purchasers
Named in Schedule 1 hereto
Ladies and Gentlemen:
NRG Northeast Generating LLC, a Delaware limited liability
company (the "Company"), proposes to issue and sell $320,000,000 aggregate
principal amount of its 8.065% Series A Senior Secured Bonds due 2004,
$130,000,000 aggregate principal amount of its 8.842% Series B Senior Secured
Bonds due 2015 and $300,000,000 aggregate principal amount of its 9.292% Series
C Senior Secured Bonds due 2024 (collectively, the "Securities"). The Securities
will be issued pursuant to an Indenture to be dated as of February 22, 2000 (the
"Indenture") among the Company, the Guarantors party thereto and The Chase
Manhattan Bank, as trustee (the "Trustee"). The Company hereby enters into this
agreement with Chase Securities Inc. ("CSI") and Salomon Smith Barney Inc.
("SSB" and together with CSI, the "Representatives") concerning the purchase of
the Securities from the Company by the several Initial Purchasers.
The Securities will be offered and sold to the Initial
Purchasers without being registered under the Securities Act of 1933, as amended
(the "Securities Act"), in reliance upon an exemption therefrom. The Company has
prepared a preliminary offering circular dated February 1, 2000 (the
"Preliminary Offering Circular") and will prepare an offering circular dated the
date hereof (the "Offering Circular") setting forth information concerning the
Company and the Securities. Copies of the Preliminary Offering Circular have
been, and copies of the Offering Circular will be, delivered by the Company to
the Initial Purchasers pursuant to the terms of this Agreement. Any references
herein to the Preliminary Offering Circular and the Offering Circular
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shall be deemed to include all amendments and supplements thereto, unless
otherwise noted. The Company hereby confirms that it has authorized the use of
the Preliminary Offering Circular and the Offering Circular in connection with
the offering and resale of the Securities by the Initial Purchasers in
accordance with Section 2.
Holders of the Securities (including the Initial Purchasers
and their direct and indirect transferees) will be entitled to the benefits of
an Exchange and Registration Rights Agreement, substantially in the form
attached hereto as Annex A (the "Registration Rights Agreement"), pursuant to
which the Company will agree to file with the Securities and Exchange Commission
(the "Commission") (i) a registration statement under the Securities Act (the
"Exchange Offer Registration Statement") registering an issue of senior bonds of
the Company (the "Exchange Securities") which are identical in all material
respects to the Securities (except that the Exchange Securities will not contain
terms with respect to transfer restrictions) and (ii) under certain
circumstances, a shelf registration statement pursuant to Rule 415 under the
Securities Act (the "Shelf Registration Statement").
The Company will use the proceeds of the Securities (i) to
repay all amounts of principal and interest outstanding under certain existing
Indebtedness of the Company, (ii) to pay costs and expenses in connection with
the offering of the Securities, and (iii) to repay NRG Energy money loaned in
connection with the acquisition of the Connecticut Facilities.
Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Offering Circular.
1. Representations, Warranties and Agreements of the Company.
The Company represents and warrants to, and agrees with, the several Initial
Purchasers on and as of the date hereof and the Closing Date (as defined in
Section 3) that:
(a) Each of the Preliminary Offering Circular and the Offering
Circular, as of its respective date, did not, and on the Closing Date
the Offering Circular will not, contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided that the Company makes no representation or warranty as to
information contained in or omitted from the Preliminary Offering
Circular or the Offering Circular in reliance upon and in conformity
with written information relating to the Initial Purchasers furnished
to the Company by or on behalf of any Initial Purchaser specifically
for use therein (the "Initial Purchasers' Information").
(b) Each of the Preliminary Offering Circular and the Offering
Circular, as of its respective date, contains all of the information
that, if requested by a prospective purchaser
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of the Securities, would be required to be provided to such prospective
purchaser pursuant to Rule 144A(d)(4) under the Securities Act.
(c) Assuming the accuracy of the representations and
warranties of the Initial Purchasers contained in Section 2 and their
compliance with the agreements set forth therein and assuming that
purchasers to whom the Initial Purchasers resell the Securities receive
a copy of the Offering Circular, it is not necessary, in connection
with the issuance and sale of the Securities to the Initial Purchasers
and the offer, resale and delivery of the Securities by the Initial
Purchasers in the manner contemplated by this Agreement and the
Offering Circular, to register the Securities under the Securities Act
or to qualify the Indenture under the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act").
(d) The Company, NRG Power Marketing and each of the
Guarantors have been duly organized and are validly existing as limited
liability companies in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do business and
are in good standing in each jurisdiction in which their respective
ownership or lease of property or the conduct of their respective
businesses requires such qualification, and have all power and
authority necessary to own or hold their respective properties and to
conduct the businesses in which they are engaged, except where the
failure to so qualify or have such power or authority could not,
singularly or in the aggregate, be reasonably expected to have a
material adverse effect on the condition (financial or otherwise),
results of operations, business or prospects of the Company and the
Guarantors taken as a whole (a "Material Adverse Effect").
(e) The Company and each of the Guarantors has outstanding
membership interests as described in the Offering Circular; all of the
outstanding membership interests in the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and
are owned solely by NRG Eastern LLC and Northeast Generation Holding
LLC; and the limited liability company agreements for the Company and
each of the Guarantors and the membership interests in the Company, to
the extent discussed therein, conform in all material respects to the
description thereof contained in the Offering Circular. All of the
outstanding membership interests of each of the Guarantors have been
duly and validly authorized and issued, are fully paid and
non-assessable and are owned directly or indirectly by the Company,
free and clear of any lien, charge, encumbrance, security interest,
restriction upon voting or transfer or any other claim of any third
party, except liens existing pursuant to the Loan Facility which will
be released or assigned to the Collateral Agent on or prior to the
Closing Date and except for such membership interests in the Guarantors
that will be transferred to the Company on or prior to the Closing
Date. The Company and each Guarantor have heretofore delivered to the
Initial Purchasers a true and complete copy of their respective limited
liability agreements.
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(f) No Guarantor is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any
other distribution in respect of such Guarantor's membership or other
ownership interests, from repaying to the Company any loans or advances
to such Guarantor from the Company or from transferring any of such
Guarantor's property or assets to the Company or any other Guarantor of
the Company, except as provided pursuant to the Loan Agreement.
(g) Each of the Company, NRG Power Marketing and each
Guarantor has full right, power and authority to execute and deliver,
to the extent a party thereto, this Agreement, the Indenture, the
Registration Rights Agreement, the Securities, the Security Agreement,
the NRG Power Marketing Security Agreement, the Collateral Agency and
Intercreditor Agreement, the Intercompany Notes and the Indemnification
Consent Agreement (collectively, the "Financing Documents") to the
extent it is a party thereto and to perform its obligations hereunder
and thereunder; and all limited liability company or other action
required to be taken for the due and proper authorization, execution
and delivery of each of the Transaction Documents (as defined in the
Indenture) to which the Company, NRG Power Marketing and each Guarantor
is a party and the consummation of the transactions contemplated
thereby have been duly and validly taken.
(h) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
agreement of the Company.
(i) The Registration Rights Agreement has been duly authorized
by the Company and each Guarantor and, when duly executed and delivered
in accordance with its terms by each of the parties thereto, will
constitute a valid and legally binding agreement of the Company and
each Guarantor enforceable against the Company and each Guarantor in
accordance with its terms, except to the extent that (x) such
enforceability may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws affecting creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at law) and
(y) the rights to indemnification and contribution thereunder may be
limited by federal and state securities laws or the public policy
underlying such laws.
(j) The Indenture has been duly authorized by the Company and
each Guarantor and, when duly executed and delivered in accordance with
its terms by each of the parties thereto, will constitute a valid and
legally binding agreement of the Company and each Guarantor enforceable
against the Company and each Guarantor in accordance with its terms,
except to the extent that such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law). On the Closing Date,
the Indenture will conform in all
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material respects to the requirements of the Trust Indenture Act and
the rules and regulations of the Commission applicable to an indenture
which is qualified thereunder.
(k) The Securities have been duly authorized by the Company
and, when duly executed, authenticated, issued and delivered as
provided in the Indenture and paid for as provided herein, will be duly
and validly issued and outstanding and will constitute valid and
legally binding obligations of the Company entitled to the benefits of
the Indenture and enforceable against the Company in accordance with
their terms, except to the extent that such enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors'
rights generally and by general equitable principles (whether
considered in a proceeding in equity or at law).
(l) Each of the Security Agreement, the NRG Power Marketing
Security Agreement, the Collateral Agency and Intercreditor Agreement,
the Indemnification Consent Agreement and the Intercompany Notes has
been duly authorized, executed and delivered by the Company, NRG Power
Marketing and the Guarantors, to the extent a party thereto, and
constitutes a valid and legally binding agreement of the Company, NRG
Power Marketing and the Guarantors enforceable against the Company, NRG
Power Marketing and the Guarantors in accordance with its terms, except
to the extent that such enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws affecting creditors' rights generally
and by general equitable principles (whether considered in a proceeding
in equity or at law).
(m) Each Transaction Document conforms in all material
respects to the description thereof contained in the Offering Circular
to the extent described therein.
(n) The execution, delivery and performance by the Company and
each Guarantor of each of the Transaction Documents to which it is a
party, the issuance, authentication, sale and delivery of the
Securities and compliance by the Company with the terms thereof and the
consummation of the transactions contemplated by the Transaction
Documents will not conflict with or (except for the Security Agreement,
the NRG Power Marketing Security Agreement and the Collateral Agency
and Intercreditor Agreement) result in a breach or violation of any of
the terms or provisions of, or constitute a default under, or result in
the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Guarantor pursuant to, any
material indenture, mortgage, deed of trust, loan agreement or other
material agreement or instrument to which the Company or any Guarantor
is a party or by which the Company or any Guarantor is bound or to
which any of the property or assets of the Company or any Guarantor is
subject, except such conflicts, breaches, violations, defaults, liens
charges or encumbrances as could not reasonably be expected to have a
Material Adverse Effect, nor will such actions result in any violation
of
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the provisions of the charter or by-laws of the Company or any
Guarantor or any statute or any judgment, order, decree, rule or
regulation of any court or arbitrator or governmental agency or body
having jurisdiction over the Company or any Guarantor or any of their
properties or assets, except such violation as could not reasonably be
expected to have a Material Adverse Effect and except for blue sky laws
and federal securities laws; and no consent, approval, authorization or
order of, or filing or registration with, any such court or arbitrator
or governmental agency or body under any such statute, judgment, order,
decree, rule or regulation is required for the execution, delivery and
performance by the Company or any Guarantor of each of the Transaction
Documents, the issuance, authentication, sale and delivery of the
Securities and compliance by the Company and each Guarantor with the
terms thereof and the consummation of the transactions contemplated by
the Transaction Documents, except for such consents, approvals,
authorizations, filings, registrations or qualifications (i) which
shall have been obtained or made prior to the Closing Date and (ii) as
may be required to be obtained or made under the Securities Act and
applicable state securities laws as provided in the Registration Rights
Agreement.
(o) PricewaterhouseCoopers LLP are independent certified
public accountants with respect to the Company and the Guarantors
within the meaning of Rule 101 of the Code of Professional Conduct of
the American Institute of Certified Public Accountants ("AICPA") and
its interpretations and rulings thereunder. The historical financial
statements (including the related notes) contained in the Offering
Circular comply in all material respects with the requirements
applicable to a registration statement on Form S-1 under the Securities
Act (except that certain supporting schedules are omitted, the notes to
the financial statements comply as to GAAP but not the requirements of
Form S-1, an audited balance sheet of the Company is omitted and
financial statements for each of the Guarantors are omitted); such
financial statements have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the
periods covered thereby, except as may be set forth in such financial
statements, and fairly present the financial position of the entities
purported to be covered thereby at the respective dates or respective
periods indicated and the results of their operations and their cash
flows for the respective periods indicated; and the financial
information contained in the Offering Circular under the headings
"Selected Financial Data", "Capitalization" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" are derived from the accounting records of the Company and
the Guarantors and fairly present the information purported to be shown
thereby. The other historical financial information and data included
in the Offering Circular are, in all material respects, fairly
presented.
(p) Except as disclosed in the Offering Circular, there are no
legal or governmental proceedings pending to which the Company or any
Guarantor is a party or of which any property or assets of the Company
or any Guarantor is the subject which could reasonably be expected to
have a Material Adverse Effect; and to the best knowledge of the
Company,
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no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(q) No action, suit or proceeding is pending against or, to
the best knowledge of the Company, threatened against or affecting the
Company or any Guarantor before any court or arbitrator or any
governmental agency, body or official, domestic or foreign, which could
reasonably be expected to interfere with or adversely affect the
issuance of the Securities or in any manner draw into question the
validity or enforceability of any of the Transaction Documents or any
action taken or to be taken pursuant thereto; and the Company has
complied with any and all requests to the Company by any securities
authority in any jurisdiction for additional information to be included
in the Preliminary Offering Circular and the Offering Circular.
(r) Neither the Company, NRG Power Marketing nor any Guarantor
is (i) in violation of its organizational documents, (ii) in default in
any respect, and no event has occurred which, with notice or lapse of
time the making of any determination or any combination thereof, would
constitute such a default, in the due performance or observance of any
term, covenant or condition contained in any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the
Company or any Guarantor is a party or by which the Company or any
Guarantor is bound or to which any of their respective properties or
assets is subject or (iii) in violation of any law, ordinance,
governmental rule, regulation or court decree to which it or its
property or assets may be subject, except in the case of clause (i),
(ii) or (iii) as could not reasonably be expected to have a Material
Adverse Effect.
(s) The Company, NRG Power Marketing and each Guarantor
possess all material licenses, certificates, authorizations and permits
issued by, and have made all filings with, the appropriate federal,
state or foreign regulatory agencies or bodies which are necessary for
the ownership of their respective properties or the conduct of their
respective businesses as described in the Offering Circular, except
where the failure to possess or make the same could not reasonably be
expected to have a Material Adverse Effect, and neither the Company nor
any Guarantor has received notification of any revocation or
modification of any such license, certificate, authorization or permit
or has any reason to believe that any such license, certificate,
authorization or permit will not be renewed in the ordinary course,
except where such revocation, modification or non-renewal could not
reasonably be expected to have a Material Adverse Effect.
(t) The Company and each Guarantor have filed all federal,
state, local and foreign income and franchise tax returns required to
be filed through the date hereof and have paid all taxes due thereon,
and no tax deficiency has been determined adversely to the Company or
any Guarantor which has had (nor does the Company or any Guarantor have
any
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knowledge of any tax deficiency which, if determined adversely to the
Company or any Guarantor, could reasonably be expected to have) a
Material Adverse Effect, except where such tax is being contested in
good faith and where adequate reserves are maintained in accordance
with generally accepted accounting principles.
(u) Neither the Company nor any of the Guarantors is required
to be registered or regulated as an "investment company" or a company
"controlled by" an investment company within the meaning of the
Investment Company Act of 1940, as amended (the "Investment Company
Act"), and the rules and regulations of the Commission thereunder.
(v) Neither the Company nor any of the Guarantors, nor any of
the members of the Company or any operator of any facility owned by the
Company or the Guarantors is a "public utility company", an "electric
utility company" or a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended ("PUHCA"), nor
subject to regulation under PUHCA except pursuant to Section 9(a)(2) or
Section 32 thereof.
(w) Each Guarantor is an "exempt wholesale generator" under
Section 32(a) of PUHCA and none of the subsidiaries, nor any of the
Trustee, the Collateral Agent or any holder of Securities is or will
be, solely as a result of the participation by such parties
individually or as a group in the ownership of the Company or the
Company's and its subsidiaries' use or operation of each facility and
sale of power generated by any such facility, subject to regulation as
a "public-utility company," an "electric utility company," a "holding
company" or a "subsidiary company" or "affiliate" of any of the
foregoing, under PUHCA.
(x) So long as each Guarantor is an "exempt wholesale
generator" under Section 32(a) of PUHCA, none of the Trustee, the
Collateral Agent or any holder of Securities will solely by reason of
the exercise of remedies under the Security Agreements be subject to
regulation as a "public-utility company," an "electric utility
company," or a "holding company," or a "subsidiary company" or
"affiliate" of any of the foregoing, under PUHCA; provided that (i)
each Guarantor remains the sole owner of each facility, within the
meaning of Section 2(a)(3) of PUHCA and maintains its "exempt wholesale
generator" status, or (ii) the Trustee, the Collateral Agent or holder
of Securities assumes ownership or operation of a facility through a
special purpose subsidiary that obtains a determination of "exempt
wholesale generator" status.
(y) The Company and each of the Guarantors maintain a system
of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
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conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(z) The Company and each Guarantor have insurance covering
their respective properties, operations, personnel and businesses,
which insurance is substantially in amounts and against such insurable
risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations and
against risks and substantially in amounts customarily insured against
by other enterprises with similar capital structures and owning and
operating facilities of like size and type as that of the Facilities in
accordance with Prudent Industry Practice (as defined in the
Indenture). Neither the Company nor any Guarantor has received notice
from any insurer or agent of such insurer that capital improvements or
other expenditures are required or necessary to be made in order to
continue such insurance.
(aa) The Company and each Guarantor own or possess adequate
rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service mark
registrations, copyrights, licenses and know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) necessary for the
conduct of their respective businesses, except where the failure to own
or possess could not reasonably be expected to have a Material Adverse
Effect; and the conduct of their respective businesses will not
conflict in any material respect with and the Company and the
Guarantors have not received any notice of any claim of conflict with,
any such rights of others which could reasonably be expected to have a
Material Adverse Effect.
(bb) The Company and each Guarantor have good and marketable
title in fee simple to, or have valid rights to lease or otherwise use,
all items of real and personal property which are material to the
business of the Company and the Guarantors, in each case free and clear
of all liens, encumbrances, claims and defects and imperfections of
title except such as (i) do not materially interfere with the use made
and proposed to be made of such property by the Company and the
Guarantors, (ii) could not reasonably be expected to have a Material
Adverse Effect or (iii) are created or permitted by the Financing
Documents.
(cc) No labor disturbance by or dispute with the employees of
the Company or any Guarantor exists or, to the best knowledge of the
Company, is contemplated or threatened.
(dd) No "prohibited transaction" (as defined in Section 406 of
the Employee Retirement Income Security Act of 1974, as amended,
including the regulations and
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published interpretations thereunder ("ERISA"), or Section 4975 of the
Internal Revenue Code of 1986, as amended (the "Code")) or "accumulated
funding deficiency" (as defined in Section 302 of ERISA) or any of the
events set forth in Section 4043(b) of ERISA (other than events with
respect to which the 30-day notice requirement under Section 4043 of
ERISA has been waived) has occurred with respect to any employee
benefit plan of the Company or any Guarantor which could reasonably be
expected to have a Material Adverse Effect; each such employee benefit
plan is in compliance in all material respects with applicable law,
including ERISA and the Code; the Company and each Guarantor have not
incurred and do not expect to incur liability under Title IV of ERISA
with respect to the termination of, or withdrawal from, any pension
plan for which the Company or any Guarantor would have any liability;
and each such pension plan that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which
could reasonably be expected to cause the loss of such qualification.
(ee) There has been no storage, generation, transportation,
handling, treatment, disposal, discharge, emission or other release of
any kind of toxic or other wastes or other hazardous substances by, due
to or caused by the Company or any Guarantor (or, to the best knowledge
of the Company, any other entity (including any predecessor) for whose
acts or omissions the Company or any Guarantor is or could reasonably
be expected to be liable) upon any of the property now or previously
owned or leased by the Company or any Guarantor, or upon any other
property, in violation of any statute or any ordinance, rule,
regulation, order, judgment, decree or permit, in each case, now in
effect or which would, under any statute or any ordinance, rule
(including rule of common law), regulation, order, judgment, decree or
permit, give rise to any liability of the Company or any Guarantor,
except for any violation or liability which could not reasonably be
expected to have, singularly or in the aggregate with all such
violations and liabilities, a Material Adverse Effect; and there has
been no disposal, discharge, emission or other release of any kind onto
such property or into the environment surrounding such property of any
toxic or other wastes or other hazardous substances with respect to
which the Company has knowledge, except for any such disposal,
discharge, emission or other release of any kind which could not
reasonably be expected to have a Material Adverse Effect.
(ff) Neither the Company nor, to the best knowledge of the
Company, any director, officer, agent, employee or other person
associated with or acting on behalf of the Company has (i) used any
corporate funds for any unlawful contribution, gift, entertainment or
other unlawful expense relating to political activity; (ii) made any
direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; (iii) violated or
is in violation of any provision of the Foreign Corrupt Practices Act
of 1977; or (iv) made any unlawful bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.
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(gg) On and immediately after the Closing Date, the Company
taken as a whole and each of the Guarantors individually (after giving
effect to the issuance of the Securities and to the other transactions
related thereto as described in the Offering Circular) will be Solvent.
As used in this paragraph, the term "Solvent" means, with respect to a
particular date, that on such date (i) the present fair market value
(or present fair saleable value) of the assets of the Company or any
Guarantor is not less than the total amount required to pay the
probable liabilities of the Company or such Guarantor, as the case may
be, on its total existing debts and liabilities (including contingent
liabilities) as they become absolute and matured, (ii) the Company or
any Guarantor, as the case may be, is able to realize upon its assets
and pay its debts and other liabilities, contingent obligations and
commitments as they mature and become due in the normal course of
business, (iii) assuming the sale of the Securities as contemplated by
this Agreement and the Offering Circular, neither the Company nor any
Guarantor is incurring debts or liabilities beyond its ability to pay
as such debts and liabilities mature and (iv) neither the Company nor
any Guarantor is engaged in any business or transaction, and is not
about to engage in any business or transaction, for which its property
would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in which the
Company or such Guarantor is engaged. In computing the amount of such
contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount that, in the light of all
the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured
liability.
(hh) Except as described in the Offering Circular, there are
no outstanding subscriptions, rights, warrants, calls or options to
acquire, or instruments convertible into or exchangeable for, or
agreements or understandings with respect to the sale or issuance of,
any shares of membership of or other equity or ownership interests in
the Company or any Guarantor.
(ii) Neither the Company nor any of the Guarantors has taken
or will take any action that would cause this Agreement or the sale of
the Securities to violate Regulation T, U or X of the Federal Reserve
Board.
(jj) Except as provided in this Agreement, neither the Company
nor any of the Guarantors is a party to any contract, agreement or
understanding with any person that would give rise to a valid claim
against the Company or the Initial Purchasers for a brokerage
commission, finder's fee or like payment in connection with the
offering and sale of the Securities.
(kk) The Securities satisfy the eligibility requirements of
Rule 144A(d)(3) under the Securities Act.
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(ll) None of the Company, any of its affiliates or any person
acting on its or their has engaged or will engage in any directed
selling efforts with respect to the Securities (as such term is defined
in Regulation S under the Securities Act ("Regulation S")), and all
such persons have complied and the Company and the Guarantors or any
person acting on its or their behalf (other the Initial Purchasers as
to which the Company makes no representation) will comply with the
offering restrictions requirement of Regulation S to the extent
applicable.
(mm) Neither the Company nor the Guarantors, nor, to the best
of the Company's knowledge, any of their affiliates has, directly or
through any agent (other than the Initial Purchasers as to which the
Company makes no representation), sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
such term is defined in the Securities Act), which is or will be
integrated with the sale of the Securities in a manner that would
require registration of the Securities under the Securities Act.
(nn) None of the Company, any Guarantor or any of their
affiliates or any other person acting on its or their behalf (other
than the Initial Purchasers as to which the Company makes no
representation) has engaged, in connection with the offering of the
Securities, in any form of general solicitation or general advertising
within the meaning of Rule 502(c) under the Securities Act.
(oo) There are no securities of the Company or any Guarantor
registered under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or listed on a national securities exchange or quoted
in a U.S. automated inter-dealer quotation system.
(pp) Neither the Company nor any of its affiliates has taken,
directly or indirectly, any action designed to cause or which has
constituted or which might reasonably be expected to cause or result,
under the Exchange Act or otherwise, in the stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(qq) No forward-looking statement (within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act)
contained in the Preliminary Offering Circular or the Offering Circular
has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.
(rr) There are no stamp or other issuance or transfer taxes or
duties or other similar fees or charges under Federal law or the laws
of any state, or any political subdivision thereof, required to be paid
in connection with the execution and delivery of
NRG Northeast Purchase Agreement
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this Agreement or the issuance or sale by the Company of the Securities
to the Initial Purchasers.
(ss) Since the date as of which information is given in the
Offering Circular, except as otherwise stated therein, (i) there has
been no material adverse change or any development involving a
prospective material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs, management or business
prospects of the Company, whether or not arising in the ordinary course
of business, (ii) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings, business
affairs, management or business prospects of NRG Operations or NRG
Power Marketing that has had a Material Adverse Effect, (iii) neither
the Company nor any Guarantor has incurred any material liability or
obligation, direct or contingent, other than in the ordinary course of
business, (iv) neither the Company nor any Guarantor has entered into
any material transaction other than in the ordinary course of business
and (v) there has not been any change in the ownership or long-term
debt of the Company or the Guarantors, or any dividend or distribution
of any kind declared, paid or made by the Company or the Guarantors on
any class of its membership interests.
(tt) Any certificate signed by any officer of the Company or
any Guarantor and delivered to the Initial Purchasers in connection
with the offering of the Securities shall be deemed a representation
and warranty by the Company, as to matters covered thereby, to each
Initial Purchaser.
2. Purchase and Resale of the Securities. (a) On the basis of
the representations, warranties and agreements contained herein, and subject to
the terms and conditions set forth herein, the Company agrees to issue and sell
to each Initial Purchaser, severally and not jointly, and each Initial
Purchaser, severally and not jointly, agrees to purchase from the Company, the
principal amount of Securities set forth opposite the name of such Initial
Purchaser on Schedule 1 hereto at a purchase price equal to 99.125% of the
principal amount thereof. The Company shall not be obligated to deliver any of
the Securities except upon payment for all of the Securities to be purchased as
provided herein.
(b) The Initial Purchasers agree with the Company that they
will offer the Securities for resale upon the terms and subject to the
conditions set forth herein and in the Offering Circular. Each Initial
Purchaser, severally and not jointly, represents and warrants to, and agrees
with, the Company that (i) it is purchasing the Securities pursuant to a private
sale exempt from registration under the Securities Act, (ii) it has not
solicited offers for, or offered or sold, and will not solicit offers for, or
offer or sell, the Securities by means of any form of general solicitation or
general advertising within the meaning of Rule 502(c) of Regulation D under the
Securities Act ("Regulation D") or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act, (iii) it has solicited
and will solicit offers for the Securities in the United States
NRG Northeast Purchase Agreement
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only from, and has offered or sold and will offer, sell or deliver the
Securities, as part of its initial offering in the United States, only to
persons whom it reasonably believes to be qualified institutional buyers
("Qualified Institutional Buyers") as defined in Rule 144A under the Securities
Act, or if any such person is buying for one or more institutional accounts for
which such person is acting as fiduciary or agent, only when such person has
represented to it that each such account is a Qualified Institutional Buyer to
whom notice has been given that such sale or delivery is being made in reliance
on Rule 144A and in each case, in transactions in accordance with Rule 144A or
from Institutional Accredited Investors within the meaning of Rule 501(a)(1),
(2), (3) or (7) under the Securities Act in minimum denominations of $250,000
and (iv) they will make offers and sales to Non-U.S. Persons in reliance on
Regulation S only in accordance with the restrictions set forth in Exhibit A
hereto. Each Initial Purchaser, severally and not jointly, agrees that, prior to
or simultaneously with the confirmation of sale by such Initial Purchaser to any
purchaser of any of the Securities purchased by such Initial Purchaser from the
Company pursuant hereto, such Initial Purchaser shall furnish to that purchaser
a copy of the Offering Circular (and any amendment or supplement thereto that
the Company shall have furnished to such Initial Purchaser prior to the date of
such confirmation of sale). In addition to the foregoing, each Initial Purchaser
acknowledges and agrees that the Company and, for purposes of the opinions to be
delivered to the Initial Purchasers pursuant to Sections 5(d) and (e), counsel
for the Company and for the Initial Purchasers, respectively, may rely upon the
accuracy of the representations and warranties of the Initial Purchasers and
their compliance with their agreements contained in this Section 2, and each
Initial Purchaser hereby consents to such reliance.
(c) The Company acknowledges and agrees that the Initial
Purchasers may sell Securities to any affiliate of an Initial Purchaser and that
any such affiliate may sell Securities purchased by it to an Initial Purchaser;
provided that such sale is in compliance with clause (b) of this Section 2 and
such affiliate complies with clause (b).
3. Delivery of and Payment for the Securities. (a) Delivery of
and payment for the Securities shall be made at the offices of Milbank, Tweed,
Hadley & McCloy LLP, New York, New York, or at such other place as shall be
agreed upon by the Representatives and the Company, at 10:00 A.M., New York City
time, on February 22, 2000, or at such other time or date, not later than seven
full business days thereafter, as shall be agreed upon by the Initial Purchasers
and the Company (such date and time of payment and delivery being referred to
herein as the "Closing Date").
(b) On the Closing Date, payment of the purchase price for the
Securities shall be made to the Company by wire or book-entry transfer of
same-day funds to such account or accounts as the Company shall specify prior to
the Closing Date or by such other means as the parties hereto shall agree prior
to the Closing Date against delivery to the Initial Purchasers of the
certificates evidencing the Securities. Time shall be of the essence, and
delivery at the time and place specified pursuant to this Agreement is a further
condition of the obligations of the Initial Purchasers
NRG Northeast Purchase Agreement
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hereunder. Upon delivery, the Securities shall be in global form, registered in
such names and in such denominations as the Representatives shall have requested
in writing not less than two full business days prior to the Closing Date. The
Company agrees to make one or more global certificates evidencing the Securities
available for inspection by the Representatives in New York, New York at least
24 hours prior to the Closing Date.
4. Further Agreements of the Company. The Company agrees with
each of the several Initial Purchasers:
(a) at any time prior to the completion of the initial resale
of the Securities by the Initial Purchasers, (i) to advise the Initial
Purchasers promptly and, if requested, confirm such advice in writing,
of the happening of any event which makes any statement of a material
fact made in the Offering Circular, in light of the circumstances under
which such statement was made, untrue or which requires the making of
any additions to or changes in the Offering Circular (as amended or
supplemented from time to time) in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; (ii) to advise the Initial Purchasers promptly of any
order preventing or suspending the use of the Preliminary Offering
Circular or the Offering Circular, of any suspension of the
qualification of the Securities for offering or sale in any
jurisdiction and of the initiation or threatening of any proceeding for
any such purpose; and to use its reasonable best efforts to prevent the
issuance of any such order preventing or suspending the use of the
Preliminary Offering Circular or the Offering Circular or suspending
any such qualification and, if any such suspension is issued, to use
its reasonable best efforts to obtain the lifting thereof as soon as
practicable;
(b) to furnish promptly to each Initial Purchaser and counsel
for the Initial Purchasers, without charge, prior to the completion of
the initial resale of the Securities by the Initial Purchasers or the
date which is six months following the Closing Date, whichever is
earlier, as many copies of the Preliminary Offering Circular and the
Offering Circular (and any amendments or supplements thereto) as may be
reasonably requested;
(c) prior to making any amendment or supplement to the
Offering Circular, to furnish a copy thereof to each of the Initial
Purchasers and counsel for the Initial Purchasers and not to effect any
such amendment or supplement to which the Initial Purchasers shall
reasonably object by notice to the Company after a reasonable period to
review;
(d) if, at any time prior to completion of the resale of the
Securities by the Initial Purchasers, any event shall occur or
condition exist as a result of which it is necessary, in the opinion of
counsel for the Initial Purchasers or counsel for the Company, to amend
or supplement the Offering Circular in order that the Offering Circular
will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make
NRG Northeast Purchase Agreement
16
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the statements therein, in the light of the circumstances existing at
the time it is delivered to a transferee of any Initial Purchaser, not
misleading, or if it is necessary to amend or supplement the Offering
Circular to comply with applicable law, to promptly prepare such
amendment or supplement as may be necessary to correct such untrue
statement or omission or so that the Offering Circular, as so amended
or supplemented, will comply with applicable law;
(e) for so long as the Securities are outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, to furnish to holders of the Securities and prospective
purchasers of the Securities designated by such holders, upon request
of such holders or such prospective purchasers, the information
required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act, unless the Company is then subject to, and has filed
all reports required pursuant to, Section 13 or 15(d) of the Exchange
Act (the foregoing agreement being for the benefit of the holders from
time to time of the Securities and prospective purchasers of the
Securities designated by such holders);
(f) for so long as the Securities are outstanding, after the
effectiveness of any exchange offer registration statement or shelf
registration statement as contemplated under the Registration Rights
Agreement, to furnish to the Initial Purchasers copies of any annual
reports, quarterly reports and current reports filed by the Company
with the Commission on Forms 10-K, 10-Q and 8-K, or, prior to the
effectiveness of any exchange offer registration statement or shelf
registration statement as contemplated under the Registration Rights
Agreement, such other similar forms as may be designated by the
Commission, and such other documents, reports and information as shall
be furnished by the Company to the Trustee or to the holders of the
Securities pursuant to the Indenture or the Exchange Act or any rule or
regulation of the Commission thereunder;
(g) to promptly use its reasonable best efforts to take from
time to time such actions as the Initial Purchasers may reasonably
request to qualify the Securities for offering and sale under the
securities or Blue Sky laws of such jurisdictions as the Initial
Purchasers may reasonably designate and to continue such qualifications
in effect for so long as required for the resale of the Securities by
the Initial Purchasers; and to arrange for the determination of the
eligibility for investment of the Securities under the laws of such
jurisdictions as the Initial Purchasers may reasonably request;
provided that the Company and its subsidiaries shall not be obligated
to qualify as foreign corporations or as a dealer in securities in any
jurisdiction in which they are not so qualified or to file a general
consent to service of process in any jurisdiction or take any other
action that will subject the Company to any tax it would otherwise not
be subject to;
(h) to assist the Initial Purchasers in arranging for the
Securities to be eligible for clearance and settlement through The
Depository Trust Company ("DTC");
NRG Northeast Purchase Agreement
17
- 17 -
(i) except following the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement, not to, and
to cause its affiliates not to, sell, offer for sale or solicit offers
to buy or otherwise negotiate in respect of any security (as such term
is defined in the Securities Act) which could be integrated with the
sale of the Securities in a manner which would require registration of
the Securities under the Securities Act;
(j) except following the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement, as the case
may be, not to, and to cause its affiliates not to, and not to
authorize or knowingly permit any person acting on their behalf to,
solicit any offer to buy or offer to sell the Securities by means of
any form of general solicitation or general advertising within the
meaning of Regulation D or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act; not to offer,
sell, contract to sell or otherwise dispose of, directly or indirectly,
any securities under circumstances where such offer, sale, contract or
disposition would cause the exemption afforded by Section 4(2) of the
Securities Act to cease to be applicable to the offering and sale of
the Securities as contemplated by this Agreement and the Offering
Circular; not to, and to cause its subsidiaries not to, and not to
authorize any person acting on its or its subsidiaries' behalf to
engage in any directed selling efforts (within the meaning of
Regulation S) with respect to the Securities; and to comply and to
cause each of its subsidiaries to comply with the offering restrictions
requirement of Regulation S;
(k) except as required by the Registration Rights Agreements
for a period of 90 days from the date of the Offering Circular, not to
offer for sale, sell, contract to sell or otherwise dispose of,
directly or indirectly, or file a registration statement for, or
announce any offer, sale, contract for sale of or other disposition of
any debt securities issued or guaranteed by the Company or any of its
subsidiaries (other than the Securities) without the prior written
consent of the Initial Purchasers;
(l) during the period from the Closing Date until two years
after the Closing Date, without the prior written consent of the
Initial Purchasers, not to, and not permit any of its affiliates (as
defined in Rule 144 under the Securities Act) to, resell any of the
Securities that have been reacquired by them, except for Securities
purchased by the Company or any of its affiliates and resold in a
transaction registered under the Securities Act;
(m) in connection with the offering of the Securities, until
either Representative on behalf of the Initial Purchasers shall have
notified the Company of the completion of the resale of the Securities,
not to, and not to instruct its affiliated purchasers (as defined in
Regulation M under the Exchange Act) to, either alone or with one or
more other persons, bid for or purchase, for any account in which it or
any of its affiliated purchasers has a beneficial interest, any
Securities, or attempt to induce any person to purchase any
NRG Northeast Purchase Agreement
18
- 18 -
Securities; and not to, and not to instruct its affiliated purchasers
to, make bids or purchase for the purpose of creating actual, or
apparent, active trading in or of raising the price of the Securities;
(n) in connection with the offering of the Securities, to make
its officers, employees, independent accountants and legal counsel
reasonably available upon request by the Initial Purchasers;
(o) to do and perform all things required to be done and
performed by it under this Agreement that are within its control prior
to or after the Closing Date, and to use its best efforts to satisfy
all conditions precedent on its part to the delivery of the Securities;
(p) except for actions described in the Offering Circular, to
not take any action prior to the execution and delivery of the
Indenture which, if taken after such execution and delivery, would have
violated any of the covenants contained in the Indenture;
(q) prior to the Closing Date, not to issue any press release
or other communication directly or indirectly or hold any press
conference with respect to the Company, its condition, financial or
otherwise, or earnings, business affairs or business prospects (except
for routine oral marketing communications in the ordinary course of
business and consistent with the past practices of the Company and of
which the Initial Purchasers are notified), without the prior written
consent of the Initial Purchasers, unless in the judgment of the
Company and its counsel, and after notification to the Initial
Purchasers, such press release or communication is required by law or
would not cause the Securities to be required to be registered under
the Securities Act; and
(r) to apply the net proceeds from the sale of the Securities
as set forth in the Offering Circular under the heading "Use of
Proceeds".
5. Conditions of Initial Purchasers' Obligations. The
respective obligations of the several Initial Purchasers hereunder are subject
to the accuracy, on and as of the date hereof and the Closing Date, of the
representations and warranties of the Company contained herein, to the accuracy
of the statements of the Company and its officers made in any certificates
delivered pursuant hereto, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Offering Circular (and any amendments or supplements
thereto) shall have been printed and copies thereof distributed to the
Initial Purchasers as promptly as practicable on or following the date
of this Agreement or at such other date and time as to which the
Initial Purchasers may agree; and no stop order suspending the sale of
the Securi-
NRG Northeast Purchase Agreement
19
- 19 -
ties in any jurisdiction shall have been issued and no proceeding for
that purpose shall have been commenced or shall be pending or
threatened.
(b) None of the Initial Purchasers shall have discovered and
disclosed to the Company on or prior to the Closing Date that the
Offering Circular or any amendment or supplement thereto contains an
untrue statement of a fact which, in the reasonable opinion of counsel
for the Initial Purchasers, is material or omits to state any fact
which, in the reasonable opinion of such counsel, is material and is
required to be stated therein or is necessary to make the statements
therein not misleading.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of each of the Transaction
Documents and the Offering Circular, and all other legal matters
relating to the Transaction Documents and the transactions contemplated
thereby, shall be satisfactory in all material respects to the Initial
Purchasers, and the Company and the Guarantors shall have furnished to
the Initial Purchasers all documents and information that they or their
counsel may reasonably request to enable them to pass upon such
matters.
(d) Skadden, Arps, Slate, Meagher & Flom LLP shall have
furnished to the Initial Purchasers their written opinion, as counsel
to the Company, addressed to the Initial Purchasers and dated the
Closing Date, in form and substance reasonably satisfactory to the
Initial Purchasers.
(e) The Initial Purchasers shall have received from Milbank,
Tweed, Hadley & McCloy LLP, counsel for the Initial Purchasers, such
opinion or opinions, dated the Closing Date, with respect to such
matters as the Initial Purchasers may reasonably require, and the
Company and the Guarantors shall have furnished to such counsel such
documents and information as they reasonably request for the purpose of
enabling them to pass upon such matters.
(f) The Company shall have furnished to the Initial Purchasers
a letter (the "Initial Letter") of PricewaterhouseCoopers LLP,
addressed to the Representatives and dated the date hereof, in form and
substance satisfactory to the Initial Purchasers, substantially to the
effect set forth in Annex B hereto.
(g) The Company shall have furnished to the Initial Purchasers
a letter (the "Bring-Down Letter") of PricewaterhouseCoopers LLP,
addressed to the Representatives and dated the Closing Date (i)
confirming that they are independent public accountants with respect to
the Company and its subsidiaries within the meaning of Rule 101 of the
Code of Professional Conduct of the AICPA and its interpretations and
rulings thereunder, (ii) stating, as of the date of the Bring-Down
Letter (or, with respect to matters involving
NRG Northeast Purchase Agreement
20
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changes or developments since the respective dates as of which
specified financial information is given in the Offering Circular, as
of a date not more than three business days prior to the date of the
Bring-Down Letter), that the conclusions and findings of such
accountants with respect to the financial information and other matters
covered by the Initial Letter are accurate and (iii) confirming in all
material respects the conclusions and findings set forth in the Initial
Letter.
(h) The Company shall have furnished to the Initial Purchasers
a certificate, dated the Closing Date, of its president and its
treasurer stating that (A) such officers have carefully examined the
Offering Circular, (B) in their opinion, the Offering Circular, as of
its date, did not include any untrue statement of a material fact and
did not omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and since the
date of the Offering Circular, no event has occurred which should have
been set forth in a supplement or amendment to the Offering Circular so
that the Offering Circular (as so amended or supplemented) would not
include any untrue statement of a material fact and would not omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading and (C) as of the Closing
Date, the representations and warranties of the Company in this
Agreement are true and correct in all material respects, the Company
has complied in all material respects with all agreements and satisfied
in all material respects all conditions on its part to be performed or
satisfied hereunder on or prior to the Closing Date, and subsequent to
the date of the most recent financial statements contained in the
Offering Circular, there has been no material adverse change in the
financial position or results of operation of the Company and the
Guarantors taken as a whole, or any change, or any development
including a prospective change, in or affecting the condition
(financial or otherwise), results of operations, business or prospects
of the Company and the Guarantors taken as a whole, except as set forth
in the Offering Circular.
(i) The Initial Purchasers shall have received a counterpart
of the Registration Rights Agreement which shall have been executed and
delivered by a duly authorized officer of the Company and each
Guarantor.
(j) The Indenture shall have been duly executed and delivered
by the Company, each Guarantor and the Trustee, and the Securities
shall have been duly executed and delivered by the Company and duly
authenticated by the Trustee.
(k) If any event shall have occurred that requires the Company
under Section 4(d) to prepare an amendment or supplement to the
Offering Circular, such amendment or supplement shall have been
prepared, the Initial Purchasers shall have been given a
NRG Northeast Purchase Agreement
21
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reasonable opportunity to comment thereon, and copies thereof shall
have been delivered to the Initial Purchasers reasonably in advance of
the Closing Date.
(l) There shall not have occurred any invalidation of Rule
144A under the Securities Act by any court or any withdrawal or
proposed withdrawal of any rule or regulation under the Securities Act
or the Exchange Act by the Commission or any amendment or proposed
amendment thereof by the Commission which in the reasonable judgment of
the Initial Purchasers would materially impair the ability of the
Initial Purchasers to purchase, hold or effect resales of the
Securities as contemplated hereby.
(m) Except as contemplated in the Offering Circular or any
Financing Document, subsequent to the execution and delivery of this
Agreement or, if earlier, the dates as of which information is given in
the Offering Circular (exclusive of any amendment or supplement
thereto), there shall not have been any change in the ownership of the
membership or other interests in the Company or any Guarantor or the
Company's or any Guarantor's long-term debt or any change, or any
development involving a prospective change, in or affecting the
condition (financial or otherwise), results of operations, business or
prospects of the Company and the Guarantors taken as a whole, the
effect of which, in any such case described above, is, in the
reasonable judgment of the Initial Purchasers, so material and adverse
as to make it impracticable or inadvisable to proceed with the sale or
delivery of the Securities on the terms and in the manner contemplated
by this Agreement and the Offering Circular (exclusive of any amendment
or supplement thereto).
(n) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency or body which would, as of the Closing Date,
prevent the issuance or sale of the Securities; and no injunction,
restraining order or order of any other nature by any federal or state
court of competent jurisdiction shall have been issued as of the
Closing Date which would prevent the issuance or sale of the
Securities.
(o) Moody's Investors Service Inc. ("Moody's") and Standard &
Poors Ratings Services Inc. ("S&P") shall have rated the Securities at
least Baa3 and BBB-, respectively. Subsequent to the execution and
delivery of this Agreement (i) no downgrading shall have occurred in
the rating accorded the Securities by Moody's, S&P or any other
"nationally recognized statistical rating organization", as such term
is defined by the Commission for purposes of Rule 436(g)(2) of the
rules and regulations of the Commission under the Securities Act and
(ii) no such organization shall have publicly announced that it has
under surveillance or review (other than an announcement with positive
implications of a possible upgrading), its rating of the Securities.
NRG Northeast Purchase Agreement
22
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(p) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or the over-the-counter market shall have been suspended or
materially limited, or minimum prices shall have been established on
any such exchange or market by the Commission, by any such exchange or
by any other regulatory body or governmental authority having
jurisdiction, or trading in any securities of the Company on any
exchange or in the over-the-counter market shall have been suspended or
(ii) any general moratorium on commercial banking activities shall have
been declared by federal or New York state authorities or (iii) an
outbreak or escalation of hostilities or a declaration by the United
States of a national emergency or war or (iv) a material adverse change
in general economic, political or financial conditions (or the effect
of international conditions on the financial markets in the United
States shall be such) the effect of which, in the case of this clause
(iv) or, in the case of any outbreak or escalation of hostilities not
involving the United States referred to in clause (iii), is, in the
reasonable judgment of the Initial Purchasers, so material and adverse
as to make it impracticable or inadvisable to proceed with the sale or
the delivery of the Securities on the terms and in the manner
contemplated by this Agreement and in the Offering Circular (exclusive
of any amendment or supplement thereto).
(q) Stone & Webster shall have (i) delivered its final report
to the Initial Purchasers in form and substance reasonably satisfactory
in all respects to the Initial Purchasers favorably reviewing (among
other matters) the technical feasibility of all engineering, design,
capacity and operating specifications and arrangements and capital
expenditure and operating cost estimates relating to the Facilities and
environmental matters relating to the Facilities, (ii) consented to the
inclusion of its report in the Preliminary Offering Circular, the
Offering Circular and any registration statement filed in accordance
with the Registration Rights Agreement and (iii) provided a letter,
dated the Closing Date, confirming its report and the conclusions
therein as of the Closing Date.
(r) PHB Hagler Bailly shall have (i) delivered its final
report to the Initial Purchasers in form and substance reasonably
satisfactory in all respects to the Initial Purchasers, (ii) consented
to the inclusion of its report in the Preliminary Offering Circular,
the Offering Circular and any registration statement filed in
accordance with the Registration Rights Agreement and (iii) provided a
letter, dated the Closing Date, confirming its report and the
conclusions therein as of the Closing Date.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Initial Purchasers.
NRG Northeast Purchase Agreement
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6. Termination. The obligations of the Initial Purchasers
hereunder may be terminated by the Initial Purchasers, in their absolute
discretion, by notice given to and received by the Company prior to delivery of
and payment for the Securities if, prior to that time, any of the events
described in Section 5(l), (m), (n), the second sentence of Section (o) or
Section (p) shall have occurred and be continuing.
7. Defaulting Initial Purchasers. (a) If, on the Closing Date,
any Initial Purchaser defaults in the performance of its obligations under this
Agreement, the non-defaulting Initial Purchasers shall make arrangements for the
purchase of the Securities which such defaulting Initial Purchaser agreed but
failed to purchase; provided, however, that in the event the aggregate principal
amount of Securities which the defaulting Initial Purchaser or Initial
Purchasers agreed but failed to purchase shall exceed one-eleventh of the
aggregate principal amount of securities set forth on Schedule 1 hereto, the
non-defaulting Initial Purchasers shall have the right to purchase all, but
shall not be under any obligation to purchase any, of the Securities. If such
non-defaulting Initial Purchasers do not purchase all of the Securities, this
Agreement shall terminate without liability on the part of the non-defaulting
Initial Purchasers or the Company, except that the Company will continue to be
liable for the payment of expenses to the non-defaulting Initial Purchasers to
the extent set forth in Sections 8 and 12 and except that the provisions of
Sections 9 and 10 shall not terminate and shall remain in effect. As used in
this Agreement, the term "Initial Purchasers" includes, for all purposes of this
Agreement unless the context otherwise requires, any party not listed in
Schedule 1 hereto that, pursuant to this Section 7, purchases Securities which a
defaulting Initial Purchaser agreed but failed to purchase.
(b) Nothing contained herein shall relieve a defaulting
Initial Purchaser of any liability it may have to the Company or any
non-defaulting Initial Purchaser for damages caused by its default. If other
persons are obligated or agree to purchase the Securities of a defaulting
Initial Purchaser, either the non-defaulting Initial Purchasers or the Company
may postpone the Closing Date for up to seven full business days in order to
effect any changes that in the opinion of counsel for the Company or counsel for
the Initial Purchasers may be necessary in the Offering Circular or in any other
document or arrangement, and the Company agrees to promptly prepare any
amendment or supplement to the Offering Circular that effects any such changes.
8. Reimbursement of Initial Purchasers' Expenses. If (a) this
Agreement shall have been terminated pursuant to Section 6 or 7, (b) the Company
shall fail to tender the Securities for delivery to the Initial Purchasers for
any reason permitted under this Agreement or (c) the Initial Purchasers shall
decline to purchase the Securities for any reason permitted under this
Agreement, the Company shall reimburse the Initial Purchasers for such
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
as shall have been reasonably incurred by the Initial Purchasers in connection
with this Agreement and the proposed purchase and resale of the Securities. If
this Agreement is terminated pursuant to Section 7 by reason of the default of
one or
NRG Northeast Purchase Agreement
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more of the Initial Purchasers, the Company shall not be obligated to reimburse
any defaulting Initial Purchaser on account of such expenses.
9. Indemnification. (a) The Company shall indemnify and hold
harmless each Initial Purchaser, its affiliates, their respective officers,
directors, employees, representatives and agents, and each person, if any, who
controls any Initial Purchaser within the meaning of the Securities Act or the
Exchange Act (collectively referred to for purposes of this Section 9(a) and
Section 10 as an Initial Purchaser), from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including,
without limitation, any loss, claim, damage, liability or action relating to
purchases and sales of the Securities), to which that Initial Purchaser may
become subject, whether commenced or threatened, under the Securities Act, the
Exchange Act, any other federal or state statutory law or regulation, at common
law or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Offering Circular or
the Offering Circular or in any amendment or supplement thereto or (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, and shall
reimburse each Initial Purchaser promptly upon demand for any legal or other
expenses reasonably incurred by that Initial Purchaser in connection with
investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the Company
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, an untrue statement
or alleged untrue statement in or omission or alleged omission from any of such
documents in reliance upon and in conformity with any Initial Purchasers'
Information; and provided, further, that with respect to any such untrue
statement in or omission from the Preliminary Offering Circular or the Offering
Circular, the indemnity agreement contained in this Section 9(a) shall not inure
to the benefit of any such Initial Purchaser to the extent that any such loss,
claim, damage, liability or action of or with respect to such Initial Purchaser
results from the fact that both (A) a copy of the Offering Circular or any
amendment or supplement to the Offering Circular was not sent or given to such
person at or prior to the written confirmation of the sale of such Securities to
such person and (B) the untrue statement in or omission from the Preliminary
Offering Circular was corrected in the Offering Circular or any such amendment
or supplement unless, in either case, such failure to deliver the Offering
Circular was a result of non-compliance by the Company with Section 4(b).
(b) Each Initial Purchaser, severally and not jointly, shall
indemnify and hold harmless the Company, its affiliates, their respective
officers, directors, employees, representatives and agents, and each person, if
any, who controls the Company within the meaning of the Securities Act or the
Exchange Act (collectively referred to for purposes of this Section 9(b) and
Section 10 as the Company), from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company may become subject, whether commenced or threatened,
NRG Northeast Purchase Agreement
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under the Securities Act, the Exchange Act, any other federal or state statutory
law or regulation, at common law or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Circular or the Offering Circular or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with any Initial Purchasers' Information, and
shall reimburse the Company promptly upon demand for any legal or other expenses
reasonably incurred by the Company in connection with investigating or defending
or preparing to defend against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action as such
expenses are incurred.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 9(a) or 9(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 9 except to the extent
that it has been materially prejudiced (through the forfeiture of substantive
rights or defenses) by such failure; and, provided, further, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section 9. If any
such claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that an
indemnified party shall have the right to employ its own counsel in any such
action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based upon advice of counsel to the indemnified party) that there may
be legal defenses available to it or other indemnified parties that are
different from or in addition to those available to the indemnifying party, (3)
a conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (4) the indemnifying party
has not in fact employed counsel reasonably satisfactory to the indemnified
party to assume the defense of such action within a reasonable time after
receiving notice of the commencement of the action, in
NRG Northeast Purchase Agreement
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each of which cases the reasonable fees, disbursements and other charges of
counsel will be at the expense of the indemnifying party or parties. It is
understood that the indemnifying party or parties shall not, in connection with
any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees, disbursements and other charges of more than one separate
firm of attorneys (in addition to any local counsel) at any one time for all
such indemnified party or parties. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 9(a) and 9(b), shall use all
reasonable efforts to cooperate with the indemnifying party in the defense of
any such action or claim. No indemnifying party shall be liable for any
settlement of any such action effected without its written consent, but if
settled with its written consent or if there be a final judgment for the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment. No indemnifying party shall, without the
prior written consent of the indemnified party (which consent shall not be
unreasonably withheld), effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
The obligations of the Company and the Initial Purchasers in
this Section 9 and in Section 10 are in addition to any other liability that the
Company or the Initial Purchasers, as the case may be, may otherwise have,
including in respect of any breaches of representations, warranties and
agreements made herein by any such party.
10. Contribution. If the indemnification provided for in
Section 9 is unavailable or insufficient to hold harmless an indemnified party
under Section 9(a) or 9(b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company on the one hand and the
Initial Purchasers on the other from the offering of the Securities or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and the Initial Purchasers on the other with respect to the
statements or omissions that resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Initial Purchasers on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Securities purchased under this Agreement (before deducting expenses)
received by or on behalf of the Company, on the one hand, and the total
discounts and commissions received by the Initial Purchasers with respect to the
Securities purchased under this Agreement, on the other, bear to the total gross
proceeds from the sale of the Securities under this Agreement. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged
NRG Northeast Purchase Agreement
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untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to the Company or information supplied by the Company on
the one hand or to any Initial Purchasers' Information on the other, the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The Company
and the Initial Purchasers agree that it would not be just and equitable if
contributions pursuant to this Section 10 were to be determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for such
purpose) or by any other method of allocation that does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 10 shall be deemed
to include, for purposes of this Section 10, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending or preparing to defend any
such action or claim. Notwithstanding the provisions of this Section 10, no
Initial Purchaser shall be required to contribute any amount in excess of the
amount by which the total discounts and commissions received by such Initial
Purchaser with respect to the Securities purchased by it under this Agreement
exceeds the amount of any damages which such Initial Purchaser has otherwise
paid or become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers' obligations to contribute
as provided in this Section 10 are several in proportion to their respective
purchase obligations and not joint.
11. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Initial Purchasers, the
Company and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except as
provided in Sections 9 and 10 with respect to affiliates, officers, directors,
employees, representatives, agents and controlling persons of the Company and
the Initial Purchasers and in Section 4(e) with respect to holders and
prospective purchasers of the Securities. Nothing in this Agreement is intended
or shall be construed to give any person, other than the persons referred to in
this Section 11, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein.
12. Expenses. The Company agrees with the Initial Purchasers
to pay (a) the costs incident to the authorization, issuance, sale, preparation
and delivery of the Securities to the Initial Purchasers and any taxes payable
in that connection; (b) the costs incident to the preparation, printing and
distribution of the Preliminary Offering Circular, the Offering Circular and any
amendments or supplements thereto; (c) the costs incident to the preparation,
printing and delivery of the certificates evidencing the Securities, including
stamp duties and transfer taxes, if any, payable upon issuance of the Securities
to the Initial Purchasers; (d) the reasonable fees and expenses of the Company's
counsel and independent accountants and counsel to the Initial Purchasers; (e)
the fees and expenses of qualifying the Securities under the securities laws of
the
NRG Northeast Purchase Agreement
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several jurisdictions as provided in Section 4(h) and of preparing, printing and
distributing Blue Sky Memoranda (including reasonable related fees and expenses
of counsel for the Initial Purchasers); (f) any fees charged by rating agencies
for rating the Securities; (g) the fees and expenses of the Trustee and any
paying agent and of the Collateral Agent (including reasonable related fees and
expenses of any counsel to such parties); (h) all expenses and application fees
incurred in connection with the application for the inclusion of the Securities
on the PORTAL Market and the approval of the Securities for book-entry transfer
by DTC; (j) the fees and expenses of Stone and Webster and PHB Hagler Bailly;
and (i) all other costs and expenses incident to the performance of the
obligations of the Company under this Agreement which are not otherwise
specifically provided for in this Section 12.
13. Survival. The respective indemnities, rights of
contribution, representations, warranties and agreements of the Company and the
Initial Purchasers contained in this Agreement or made by or on behalf of the
Company or the Initial Purchasers pursuant to this Agreement or any certificate
delivered pursuant hereto shall survive the delivery of and payment for the
Securities and shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement or any investigation made by or on
behalf of any of them or any of their respective affiliates, officers,
directors, employees, representatives, agents or controlling persons.
14. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Initial Purchasers, shall be delivered or sent
by mail or telecopy transmission to Chase Securities Inc., 270 Park
Avenue, New York, New York 10017, Attention: General Counsel
(telecopier no.: (212) 270-0994) and to Salomon Smith Barney General
Counsel (fax no.: (212) 816-7912) and confirmed to the General Counsel,
Salomon Smith Barney at 388 Greenwich Street, New York, New York 10013
Attention: General Counsel; or
(b) if to the Company, shall be delivered or sent by mail or
telecopy transmission to the address of the Company set forth in the
Offering Circular, Attention: General Counsel (telecopier no.:
(612) 373-5392);
provided that any notice to an Initial Purchaser pursuant to Section 9(c) shall
also be delivered or sent by mail to such Initial Purchaser at its address set
forth on the signature page hereof. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Initial Purchasers by the Representatives.
15. Definition of Terms. For purposes of this Agreement, (a)
the term "business day" means any day on which the New York Stock Exchange, Inc.
is open for trading, (b) the term
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"subsidiary" has the meaning set forth in Rule 405 under the Securities Act
provided that each Guarantor shall be a subsidiary and (c) except where
otherwise expressly provided, the term "affiliate" has the meaning set forth in
Rule 405 under the Securities Act.
16. Initial Purchasers' Information. The parties hereto
acknowledge and agree that, for all purposes of this Agreement, the Initial
Purchasers' Information consists solely of the following information in the
Preliminary Offering Circular and the Offering Circular: (i) the last paragraph
on the front cover page concerning the terms of the offering by the Initial
Purchasers; (ii) the paragraph under the heading "Plan of Distribution"
concerning over-allotment and trading activities by the Initial Purchasers; and
(iii) the statements concerning the Initial Purchasers contained in the first
four and last four paragraphs under the heading "Plan of Distribution".
17. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW RULES THEREOF TO THE EXTENT THE APPLICATION OF
SUCH PRINCIPLES WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY OTHER
JURISDICTION.
18. Counterparts. This Agreement may be executed in one or
more counterparts (which may include counterparts delivered by telecopier) and,
if executed in more than one counterpart, the executed counterparts shall each
be deemed to be an original, but all such counterparts shall together constitute
one and the same instrument.
19. Amendments. No amendment or waiver of any provision of
this Agreement, nor any consent or approval to any departure therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
parties hereto.
20. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
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If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement between the Company and the several
Initial Purchasers in accordance with its terms.
Very truly yours,
NRG NORTHEAST GENERATING LLC
By /s/ Brian B. Bird
------------------------------
Name: Brian B. Bird
Title: Treasurer
Accepted:
CHASE SECURITIES INC.
By /s/ William Dexter Rogers
----------------------------
Authorized Signatory
Address for notices pursuant to Section 9(c):
1 Chase Plaza, 25th floor
New York, New York 10081
Attention: Legal Department
SALOMON SMITH BARNEY INC.
By /s/ Barry Gold
----------------------------
Authorized Signatory
Address for notices pursuant to Section 9(c):
388 Greenwich Street
New York, NY 10013
Attention: General Counsel's Office
NRG Northeast Purchase Agreement