DEFA14A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant þ
Filed by a Party other than the Registrant o
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Soliciting Material Pursuant to §240.14a-12 |
NRG Energy, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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statement number, or the Form or Schedule and the date of its filing. |
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On July 16, 2009, NRG Energy, Inc. (NRG) issued the following open letter to NRG
stockholders:
NRG Energy Issues Open Letter to Stockholders
NRGs Board of Directors Consistently Has Focused on One Thing: Value Creation
PRINCETON, NJ; July 16, 2009NRG Energy Inc. (NYSE: NRG) today issued the following open letter to
stockholders:
Dear NRG Stockholders:
With our annual meeting just days away, you the NRG stockholder have an important decision to make.
Exelons offer continues to undervalue NRG and does not compensate you adequately, effectively
taking the value created by NRG from NRGs stockholders and transferring it to Exelons
stockholders. Although weve neither heard from, nor spoken to Exelon since our last meeting in
January 2009, we remain open to a discussion with them without precondition. However, for that
discussion to be constructive, Exelon must revise its current proposal to fairly address the
specific value of NRG, taking into account our numerous, value enhancing initiatives as we outlined
in our July 8th letter to Exelon.
As it stands, Exelons chosen mechanism for attempting to transfer the value of NRG from you to
Exelons stockholders is a proxy contest that culminates at our stockholder meeting this Tuesday.
Exelon seeks to elect at least four, and as many as nine, of its nominees on to the NRG Board. Why?
In their own words, Exelon would be satisfied with winning four or more seats as long as it can
influence the [NRG] board to endorse a deal.1 We understand that in recent days Exelon
has been telling NRG stockholders that in exchange for their vote for Exelons director nominees,
Exelon promises to be fair and open to sharing the value of NRG with NRGs own stockholders. After
nine months of not receiving fair value, we dont believe that they will be fair after a proxy
victory given that they have been relentlessly unwilling to offer fair value to NRG stockholders
before the proxy contest.
Indeed, after more than eight months of not increasing its bid during a period of continuous and
obvious value creation by NRG, Exelon finally raised their bid on July 2nd, just 12 days
prior to our annual meeting of stockholders. They did so, not because it is fair and equitable to
NRG stockholders, but because in the words of Exelons Chairman and CEO, ...we had to if we
wanted to win.2 Yet, even pressed against the wall, neither the size of Exelons
increase nor the absolute value of its revised offer has impressed the stockholders we have spoken
with or the independent sell-side analysts who have covered the Exelon offer.
Consider what analysts are saying:
We are raising our price target to $37 per share from $35 per share to reflect the Reliant retail
accretive acquisition and corresponding margin contribution...We are not surprised that NRG
rejected the revised EXC offer and we share NRGs view that the revised offer still undervalues
NRGs asset base, free cash flow capabilities, the accretive Reliant retail acquisition, and
inclusion of NRG nuclear project for DOE loan guarantees. This view is further supported by the
companys upward revisions to 2009 financial guidance, as well as, upsizing its share buyback
program. Based on July 8, 2009 closing prices, the offer is valued at $26.27 per share. (Brian J.
Russo, Ladenburg Thalmann, July 9, 2009)*
We are raising our price target on NRG Energy from $29 to $32...We note that our price target
assumes no transaction with Exelon, is based on our valuation of NRG Energy on a standalone basis,
and is 23% above the $26.02 implied value per NRG share of Exelons current offer based on EXCs
7/7/09 closing price and EXCs
proposed exchange ratio of 0.545 EXC common shares for each NRG common share. We also note that
based on the 7/07/09 closing prices of both NRG and EXC, NRG shares were trading at an 18% discount
to the implied $26.02 offer value. (Robert L. Chewning, Davenport & Company, July 8,
2009)*
We reiterate our Outperform rating and our target price remains US$42... we believe that the
company is currently trading at a 35% discount relative to the peer group. On this basis, the stock
is undervalued by 27%. (Angie Storozynski, Macquarie, July 13, 2009)*
TIME IS SHORT AND EVERY VOTE COUNTS.
VOTE YOUR WHITE PROXY BY PHONE, INTERNET OR PROXY EDGE TODAY!
While Exelon is pushing you to place its nominees on the NRG Board so that they can force an
unfavorable deal upon NRG stockholders, the fact is that they do not need any Board representation
to conclude a fair deal with NRG. NRGs management and Board of Directors are always receptive to
any credible offer that fairly values NRG, as we demonstrated last Septemberwell before the
threat of a proxy contest had arisenwhen we met with Exelon to discuss their suggestion of a
price per share that was materially above their current offer price for NRG. Should you vote to
return to your Board the four highly experienced and deeply knowledgeable incumbent directors who
are currently standing for election (as we would strongly encourage you to do), that willingness on
the part of NRG to have a constructive dialogue with Exelon, or any other credible prospective
buyer of NRG, will not subside.
NRGs annual meeting of stockholders is just days away and it is time for your voice to be heard.
To ensure that your shares are represented, please use ONLY the WHITE proxy card to vote
today FOR NRGs four experienced and highly qualified independent directorsJohn F. Chlebowski,
Howard E. Cosgrove, William E. Hantke and Anne C. Schaumburg; and vote AGAINST Exelons proposal to
expand your Board.
Our Board and management have been, and remain, committed to creating value for NRG stockholders
that far surpasses Exelons offer, and we urge you to act today to protect and enhance your
investment in NRG. You have the opportunity to send Exelon a clear message that its offer needs to
compensate you for the current value of your investment in NRG, or the potential value of NRG in
the future.
On behalf of NRGs Board of Directors, we thank you for your continued support.
Sincerely,
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/s/ David Crane
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/s/ Howard Cosgrove
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David Crane
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Howard Cosgrove |
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President and Chief Executive Officer
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Chairman of the Board |
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About NRG
NRG Energy, Inc., a Fortune 500 company, owns and operates one of the countrys largest and most
diverse power generation portfolios. Headquartered in Princeton, NJ, the Companys power plants
provide more than 24,000 megawatts of generation capacityenough to supply more than 20 million
homes. NRGs retail business, Reliant Energy, serves more than 1.7 million residential, business,
commercial and industrial customers in Texas. A past recipient of the energy industrys highest
honorsPlatts Industry Leadership and Energy Company of the Year awards, NRG is a member of the
U.S. Climate Action Partnership (USCAP), a group of business and environmental organizations
calling for mandatory legislation to reduce greenhouse gas emissions. More information is available
at www.nrgenergy.com.
Important Information
In connection with its 2009 Annual Meeting of Stockholders (the 2009 Annual Meeting), NRG Energy,
Inc. (NRG) has filed a definitive proxy statement on Schedule 14A with the Securities and
Exchange Commission (the SEC). INVESTORS AND STOCKHOLDERS OF NRG ARE URGED TO READ THE PROXY
STATEMENT FOR THE 2009 ANNUAL
MEETING IN ITS ENTIRETY BECAUSE IT CONTAINS IMPORTANT INFORMATION. In response to the exchange
offer proposed by Exelon Corporation referred to in this communication, NRG has filed with the SEC
a Solicitation/Recommendation Statement on Schedule 14D-9. STOCKHOLDERS OF NRG ARE ADVISED TO READ
NRGS SOLICITATION/ RECOMMENDATION STATEMENT ON SCHEDULE 14D-9 IN ITS ENTIRETY BECAUSE IT CONTAINS
IMPORTANT INFORMATION. This communication does not constitute an offer to sell or the solicitation
of an offer to buy any securities of NRG.
Investors and stockholders will be able to obtain free copies of NRGs definitive proxy statement,
the Solicitation/Recommendation Statement on Schedule 14D-9, any amendments or supplements to the
proxy statement and/or the Schedule 14D-9, any other documents filed by NRG in connection with the
2009 Annual Meeting and/or the exchange offer by Exelon Corporation, and other documents filed with
the SEC by NRG at the SECs website at www.sec.gov. Free copies of the definitive proxy statement,
the Solicitation/ Recommendation Statement on Schedule 14D-9, and any amendments and supplements to
these documents can also be obtained by directing a request to Investor Relations Department, NRG
Energy, Inc., 211 Carnegie Center, Princeton, New Jersey 08540.
NRG and its directors and executive officers will be deemed to be participants in the solicitation
of proxies in connection with its 2009 Annual Meeting. Detailed information regarding the names,
affiliations and interests of NRGs directors and executive officers is available in the definitive
proxy statement for the 2009 Annual Meeting, which was filed with the SEC on June 16, 2009.
Forward-Looking Statements
This communication contains forward-looking statements that may state NRGs or its managements
intentions, hopes, beliefs, expectations or predictions for the future. Such forward-looking
statements are subject to certain risks, uncertainties and assumptions, and typically can be
identified by the use of words such as will, expect, estimate, anticipate, forecast,
plan, believe and similar terms. Although NRG believes that its expectations are reasonable, it
can give no assurance that these expectations will prove to have been correct, and actual results
may vary materially. Factors that could cause actual results to differ materially from those
contemplated above include, among others, risks and uncertainties related to the capital markets
generally.
The foregoing review of factors that could cause NRGs actual results to differ materially from
those contemplated in the forward-looking statements included herein should be considered in
connection with information regarding risks and uncertainties that may affect NRGs future results
included in NRGs filings with the SEC at www.sec.gov. Statements made in connection with the
exchange offer are not subject to the safe harbor protections provided to forward-looking
statements under the Private Securities Litigation Reform Act of 1995.
Your vote is important, no matter how many or how few shares you own!
If you have any questions, require assistance with voting your WHITE proxy card,
or need additional copies of the NRG proxy materials, please contact:
proxy@mackenziepartners.com
(212) 929-5500 (Call Collect) or (800) 322-2885
To vote your shares, please sign, date and return the enclosed WHITE proxy card by mailing it in
the enclosed preaddressed, stamped envelope. Or you may vote the WHITE proxy card via
phone or Internet by following the instructions on the card.
We encourage you to disregard and not return any blue proxy cards that you receive from Exelon.
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Contacts:
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Investors: |
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Media: |
Nahla Azmy |
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Meredith Moore |
609.524.4526 |
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609.524.4522 |
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David Klein |
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Lori Neuman |
609.524.4527 |
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609.524.4525 |
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Erin Gilli |
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David Knox |
609.524.4528 |
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713.795.6106 |