425
Filed by NRG Energy, Inc. pursuant to
Rule 425 of the Securities Act of 1933
Subject Company: NRG Energy, Inc.
Commission File No.: 001-15891
On July 14, 2009, NRG Energy, Inc. (NRG) issued the following press release:
NRG Energy Urges Stockholders to Vote for NRGs Experienced and
Highly Qualified Directors
PRINCETON, NJ; July 14, 2009NRG Energy Inc. (NYSE: NRG) is mailing a letter to NRG stockholders
recommending that they vote today for the NRG Boards four experienced and highly qualified
independent directorsJohn F. Chlebowski, Howard E. Cosgrove, William E. Hantke and Anne C.
Schaumburg.
The full text of the letter follows:
July 14, 2009
Dear NRG Stockholders:
By now, having been bombarded with multiple mailings from NRG and from Exelon, you may be yearning
for some incontestably impartial advice regarding next weeks proxy contest. You should know that
such advice is now available from proxy advisory companies that conduct independent research and
analysis and ultimately, recommend how to vote in proxy contests.
EXELON ISNT PAYING NRG STOCKHOLDERS ENOUGH:
ALL FOUR LEADING PROXY ADVISORY FIRMS RECOMMEND
STOCKHOLDERS VOTE FOR RE-ELECTION OF NRG DIRECTORS AND AGAINST BOARD
EXPANSION VOTE TODAY
The four leading proxy advisory firms, RiskMetrics Group, along with PROXY Governance, Glass Lewis,
and Egan-Jones Proxy Services, announced support for NRG and have recommended that NRG stockholders
vote FOR the re-election of NRGs four highly qualified and experienced directors and against
Exelons board expansion proposal.
RiskMetrics (RMG), in its July 13 report, cited the following*:
Given RMGs conclusion that Exelons current bid is not compelling enough to support
splitting the board with nine dissident nominees, RMG recommends that shareholders vote on
the Management Proxy (White Card), and support the re-election of all the incumbent
nominees.
PROXY Governance, in its July 9 report, commented*:
...We believe shareholders will be best served by re-electing the incumbent nominees...Far
from being entrenched, the companys management and board are open to strategic discussions
which might maximize shareholder value...In NRGs strategies over the past five years one
sees an acute awareness of opportunity, and a deep understanding of how and where to hedge
various risks.
In its July 9 report, Glass Lewis stated*:
...We find no reason to recommend for the election of the Dissident [Exelon] nominees to the
NRG board of directors. In our opinion, the board and its advisors have given Exelons
proposals
and Offer reasonable consideration... we do not believe shareholders should support this
expansion in the Companys board.
Egan-Jones, in its July 9 report, stated*:
We believe, as reportedly so do several significant shareholders of the Company, that
Exelons revised offer of July 2 continues to undervalue the Company, thereby making
furtherance of its proxy contest undesirable at this time.
While we believe the unanimous support weve received from the proxy advisory firms is an important
consideration, we very much recognize and appreciate that you, our stockholders, will be making
your own decisions based on a variety of issues and opinions regarding NRGs appropriate value.
Consider the following important key value factors:
NRGS GROWTH AND VALUE CREATION ARE NOT ACCIDENTAL;
THEY ARE PART OF NRGS DNA
NRGs current directors have overseen a five-year period of growth and value creation at NRG based
on an unmatched record of financial, operational and transactional execution. NRG continues to
believe that Exelons hostile proposal is inadequate, highly conditional, and does not compensate
NRG stockholders for the value our company has created. Regardless of the outcome with Exelon, the
NRG Board and management team will remain committed, as always, to driving value for our
stockholders and remaining open to offers at the right price and on the right terms.
In accordance with recommendations from RiskMetrics Group, PROXY Governance, Glass Lewis and
Egan-Jones, we strongly urge all NRG stockholders to vote FOR our director nominees on the WHITE
proxy card and AGAINST Exelons proposal to expand the Companys Board.
NRGS WELL-EXECUTED STRATEGY
CONTINUES TO LEAD THE WAY TO FURTHER GROWTH AND SUCCESS
Your Board has been focused, is focused and will remain focused on creating value for you, NRGs
stockholders. To this end, your Board has overseen the development and effective execution of a
distinctive strategy that has significantly increased the value of NRG even in the midst of the
current economic down cycle.
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NRG has increased its guidance for full-year 2009, raising its adjusted EBITDA by $325
million to $2.5 billion, and its cash from operations by $200 million to $1.675 billion. |
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NRGs strong cash position, the sale of the MIBRAG asset, and the net proceeds of the
recent bond offering have resulted in liquidity in excess of $4.0 billion as of June 30, 2009. |
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NRGs Board of Directors has authorized an increase in the Companys share buyback program
to $500 million, continuing NRGs long history of returning capital to stockholders. The
Company intends to resume its common share repurchases later this year and will seek to
complete the $500 million in buybacks by the end of 2009. |
The primary components of NRGs continued growth strategy include opportunities like:
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NRGs recent acquisition of Reliant Energys retail assets that, thanks to its
countercyclical nature, is well on its way to paying for itselfcontributing $200 million to
NRGs adjusted EBITDA in the first two months since the transaction closed. By the end of
2009, we expect the total contribution to our adjusted EBITDA to be more than $400 million. |
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NRGs leading position in the coming U.S. nuclear renaissance, with its plans to develop
two additional nuclear units South Texas Project 3&4 was chosen as one of only four
nuclear development projects advanced by the Department of Energy in its nuclear loan
guarantee program. |
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NRGs organic growth prospects are driven by FORNRG, a Companywide, multi-year initiative
to increase the return on invested capital (ROIC) through operational performance
improvements, which through 2008 contributed over $150 million in free cash flow and is
expected to result in an additional $150 million recurring free cash flow improvement per year
by 2012. |
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RepoweringNRG advances NRGs low to no carbon technology initiatives, thereby reducing the
Companys carbon intensity while adding significant value for NRG stockholders. |
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NRG is focused on value maximization while minimizing capital risk. NRGs Board has
overseen the Companys value-enhancing actions and we believe NRG has an innovative and
promising strategy to deliver value to stockholders now and in the future. As outlined above,
with a free cash flow yield exceeding 22% and $4 billion of liquidity, a standalone NRG is far
better positioned to realize stockholder value above and beyond Exelons inadequate revised
offer. |
EXELONS OFFER HAS NEGATIVELY AFFECTED NRGS STOCK PRICE
We believe that Exelons inadequate and highly conditional offer continues to constrain NRGs stock
performance and has for some time. Despite Exelons claims regarding NRGs trading history as
compared to its peers, NRG has a long history of substantially outperforming its independent power
producers peer group. In fact, looking at the five-year period prior to Exelons hostile offer,
NRGs stock not only outperformed its peers, but also outperformed all relevant indices as well as
the competitive power industry as a whole, including Exelon.
Since Exelon announced its offer, the stocks of competitive power generators have recovered and,
over the last four months, risen on average by approximately 97%. During this same period, however,
NRG has only risen by approximately 36%, underscoring our belief that Exelons offer has negatively
affected our stock price.
As an NRG stockholder, you should vote to tell Exelon to increase its exchange offer and improve
its terms substantially or else go away. If they increase substantially, you benefit. If they
decline to increase and Exelon walks away, you will be unleashing the power of NRG. Either way, you
the stockholder of NRG, win.
VOTE ONLY THE WHITE PROXY CARD TODAY ELECT THE NRG DIRECTORS
WHO HAVE LOOKED OUT, AND WILL CONTINUE TO LOOK OUT,
FOR YOUR BEST INTERESTS.
Your vote is extremely important. We urge you to use ONLY the WHITE proxy card, not the Blue card,
to:
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Vote FOR NRGs four experienced and highly qualified INDEPENDENT directors John F.
Chlebowski, Howard E. Cosgrove, William E. Hantke and Anne C. Schaumburg; and |
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Vote AGAINST Exelons proposal to expand your Board. |
Please sign, date and return the enclosed WHITE proxy card promptly after you receive it. You may
also vote by phone or Internet by following the instructions on your WHITE proxy card. DO NOTE VOTE
Exelons BLUE proxy card as it can nullify your vote for NRGs WHITE proxy card.
Your vote is important, no matter how many or how few shares you own. If you have any questions or
need any assistance voting your shares, please contact MacKenzie Partners, Inc., which is assisting
NRG in this matter, at 800.322.2885.
On behalf of NRGs Board of Directors, we thank you for your continued support.
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Sincerely,
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David Crane
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Howard Cosgrove |
President and Chief Executive Officer
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Chairman of the Board |
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 |