Liquidating Asset Management Agreement

LIQUIDATING ASSET MANAGEMENT AGREEMENT


This Liquidating Asset Management Agreement, dated as of April 30, 1996 (the "Agreement"), is entered into by and between NRG Generating ~.S.) Inc., a Delaware corporation (the "Company") and Wexford Management LLC., a Connecticut limited liability company ("Wexford").


WITNESSETH:


WHEREAS, the Company is a Delaware corporation formerly known as O'Brien Environmental Energy, Inc. formed pursuant to the Plan of Reorganization for O'Brien Environmental Energy, Inc. dated January 31, 1996, as amended and confirmed by order of the United States Bankruptcy Court for the District of New Jersey (the "Composite Fourth Amended and Restated Plan of Reorganization for O'Brien Environmental Energy, Inc.").


WHEREAS, Wexford and the Company desire to enter into an arrangement under which Wexford will manage the liquidation of the Liquidating Assets (as defined below) and provide related management services to the Company, upon the terms and conditions hereinafter set forth.


NOW, THEREFORE, in consideration of the premises and mutual covenants hereinafter contained, as well as other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:


ARTICLE I
Definitions


1.1 Definitions. Capitalized terms used herein that are not defined below and are defined in the Plan shall have the meanings assigned to such terms in the Plan. When used herein the following terms shall have the meanings indicated below:


"Affiliate" shall mean, as to any Person, any other Person having control of, controlled by, or under common control with, such first Person. For purposes of this definition, "control" shall mean power to direct, or cause the direction of, the management or policies of any Person, whether through ownership of securities, by contract or otherwise.


"Asset Liquidation Fee" shall mean a fee equal to a market rate liquidation services fee calculated as a percentage (not to exceed 10%) of the Net Sales Price of any Liquidating Asset sold by Wexford during the term of this Agreement, as defined in the good faith judgment of the Board of Directors.


"Bankruptcy Court" shall mean the United States Bankruptcy Court for the District of New Jersey.


"Board of Directors" shall mean the Board of Directors of the Company.


"Business Day" shall mean any day excluding Saturday, Sunday and any day which is a legal holiday under the laws of the State of New York or is a day on which banning institutions located in such state are authorized or required by law or other government action to close.


"Cause" shall mean (i) fraud, theft of Company property, or malfeasance committed by Wexford in connection with the performance of Wexford's duties hereunder, (ii) the willful misconduct or negligence of Wexford in performing its duties hereunder this Agreement, or (iii) a Section 2.9 Default.


"GAAP" shall mean generally accepted accounting principles in the United States of America as in effect from time to time.


"Joint Determination" shall mean a determination made upon the mutual agreement of the Board of Directors and Wexford, as provided in Article 6.8 hereof.


"Liquidating Assets" shall mean all of the Company's right, title and interest in and to (i) all of the outstanding common stock of Philadelphia Cogen and any management contracts relating to the Philadelphia Water Department Project to which the Company or any Affiliate thereto (other than Philadelphia Cogen) is a party; (ii) all of the equity interest in Philadelphia Biogas Supply, Inc., O'Brien Energy Services, Puma Power Plant, Ltd. and American Hydrotherm Corp.; and (iii) the Equipment Held for Sale.


"Management Duties" shall have the meaning set forth in Article 2.2.


"Net Sales Price" shall mean the gross sales price of any Liquidating Asset minus commissions, sales and other taxes, legal and accounting fees and other costs relating directly to the sales transaction, provided, however, that such costs shall not include any indebtedness directly associated with such Liquidating Asset, which indebtedness is assumed or, to the extent necessary, paid in full by the Company upon the sale of such Liquidating Asset.


"Person" shall mean an individual, corporation, business trust, joint stock company, trust, unincorporated association, joint venture, governmental authority or other entity of whatever nature.


"Petition Date" shall have the meaning assigned to such term in the Plan.


"Plan" shall have the meaning assigned to such term in the Plan.


"Section 2.9 Default" shall have the meaning set forth in Section 2.9.


"Termination Date" shall mean the effective date of termination of this Agreement for any reason permitted under Article Iv hereof


"Termination for Cause" shall have the meaning assigned to such term in Section 4.2 hereof.


2


ARTICLE II


Management Matter


2.1 Retention of Wexford. The Company hereby retains Wexford and Wexford hereby agrees to serve as the exclusive manager, operator and liquidator of the Liquidating Assets of the Company, on the terms and conditions hereinafter set forth.


2.2 Services to be Provided. Wexford shall have the responsibility, subject to the direction and control of the Board of Directors and any officer of the Company to whom the Board may delegate authority from time to time, to (i) manage the liquidation of the Liquidating Assets, (ii) to the extent requested by the Company from time to time, manage the operation of the Liquidating Assets on behalf of the Company as set forth below, and (iii) do anything necessary or incidental to the foregoing (all of such actions collectively, the "Management Duties"), subject to the limitations set forth below. Consistent with the foregoing, Wexford shall provide management services to the Company and shall use its best efforts consistent with sound commercial practice and shall render services and perform duties as follows:


(a) market and sell, on terms designed to maximize the sale proceeds that will be realized by the Company, all of the Liquidating Assets and in that connection prepare appropriate sales memoranda and other marketing material and assist in the negotiation and preparation of appropriate sales agreements and related documentation;


(b) supervise, hire, fire and set compensation for the personnel necessary to perform the Management Duties (all of which personnel shall be employed by Wexford as set forth in Section 2.5 hereof);


(c) supervise the collection of all judgments, settlements, fees, charges or other sums due to the Company relating to the Liquidating Assets, the rendering of bills for the same, and, from the proceeds of such collections or from other capital available to the Company, cause the Company to pay all costs, expenses and fees incurred or payable by the Company relating to the Liquidating Assets;


(d) prepare and deliver, or cause to be prepared and delivered, to the Board of Directors (i) no later than fifteen (15) days after the end of each month, a monthly report of all fees and expenses incurred by Wexford on behalf of the Company; and (ii) all such other information as the Board of Directors may reasonably request from time to time;


(e) prepare or cause to be prepared all financial statements and data required pursuant to any document, agreement or other instrument to which the Company is a party or by which it is bound relating to the Liquidating Assets;


(f) deposit Company funds relating to the disposition of the Liquidating Assets in such Company accounts as may be specified by the Company;


(g) assist in the preparation and timely filing of all returns relating to the Liquidating Asset ...