NRG Energy, Inc. Prices Offering of $500 Million Convertible Senior Notes

PRINCETON, N.J.–(BUSINESS WIRE)–NRG Energy, Inc. (NYSE:NRG) has priced its offering of $500 million in
aggregate principal amount of its 2.75% convertible senior notes due
2048 (the ÔÇ£NotesÔÇØ). NRG has granted to the initial purchasers a 30-day
option to purchase up to an additional $75 million in aggregate
principal amount of the Notes. The Notes will be senior unsecured
obligations of NRG and will be guaranteed by certain of its subsidiaries.

The Notes will be convertible, under certain circumstances, into cash,
shares of NRGÔÇÖs common stock or a combination thereof at NRGÔÇÖs election.
The initial conversion rate will be 20.9479 shares of common stock per
$1,000 principal amount of Notes (representing an initial conversion
price of approximately $47.74 per share of common stock), subject to
customary adjustments. The initial conversion rate represents a premium
of approximately 42.50% to the last reported sale price of $33.50 per
share of NRGÔÇÖs common stock on the New York Stock Exchange on May 21,
2018. Interest on the Notes is payable semi-annually in arrears on June
1 and December 1 of each year, commencing on December 1, 2018. The Notes
will mature on June 1, 2048, unless earlier repurchased or converted in
accordance with their terms. The Notes will be convertible only upon the
occurrence of certain events and during certain periods, but will be
freely convertible at any time from, and including, December 1, 2024
until the close of business on the second scheduled trading day
immediately before June 1, 2025 and at any time from, and including,
December 1, 2047 until the close of business on the second scheduled
trading day immediately before the maturity date.

NRG will have the option to redeem the Notes, in whole or in part, at
any time, on or after June 1, 2025, at a cash redemption price equal to
the principal amount of the Notes to be redeemed, plus accrued and
unpaid interest. Unless NRG has previously called all outstanding Notes
for redemption, holders of the Notes may require NRG to repurchase their
Notes on each of September 1, 2025, June 1, 2033 and June 1, 2040, at a
cash repurchase price equal to the principal amount of the Notes to be
repurchased, plus accrued and unpaid interest. In addition, if certain
corporate events that constitute a ÔÇ£fundamental changeÔÇØ occur before the
Notes mature, then holders of the Notes may require NRG to repurchase
their Notes at a cash repurchase price equal to the principal amount of
the Notes to be repurchased, plus accrued and unpaid interest.

NRG intends to use cash on hand and the proceeds from the offering,
including any proceeds from the exercise of the 30-day option, to repay
a portion of its outstanding indebtedness and to pay fees and expenses
related to the offering and incurred in connection with its repayment of
indebtedness. As a result, the Notes offering is expected to be leverage
neutral.

In connection with the offering of the Notes, NRG intends to use cash on
hand to repurchase shares of its common stock in an aggregate amount to
complete NRGÔÇÖs previously announced $500 million share repurchase
program. The transactions are expected to be effected (i) by repurchases
from purchasers of the Notes in privately negotiated transactions (the
ÔÇ£Private RepurchasesÔÇØ) concurrently with the closing of the Notes
offering and (ii) through an accelerated share repurchase transaction
(the ÔÇ£ASRÔÇØ). NRG entered into the ASR with an affiliate of one of the
initial purchasers (the ÔÇ£ASR CounterpartyÔÇØ) concurrently with the
pricing of the Notes. The ASR is conditioned upon the closing of the
Notes offering.

In connection with the ASR, NRG has been advised that the ASR
Counterparty expects to purchase shares of NRGÔÇÖs common stock in
secondary market transactions, and may execute other transactions in
NRGÔÇÖs common stock, or in derivative transactions relating to NRGÔÇÖs
common stock, beginning on the first trading day immediately following
the pricing of the Notes and during the term of the ASR (the ÔÇ£ASR
TermÔÇØ). These activities, including the ASR and the Private Repurchases,
may increase, or prevent a decrease, in the market price of NRGÔÇÖs common
stock or the Notes, which could affect the ability of holders to convert
the Notes and, to the extent the activity occurs during any observation
period related to a conversion of Notes, it could affect the amount and
value of the consideration that holders will receive upon conversion of
the Notes.

NRG expects the purchase price per share of the common stock repurchased
from certain purchasers of Notes in privately negotiated transactions
concurrently with the closing of the offering of the Notes to equal
$33.50, which was the closing price per share of NRGÔÇÖs common stock on
the New York Stock Exchange on the date of the pricing of the offering
of the Notes. The purchase price per share of the common stock
repurchased through the ASR will generally be equal to the average
volume-weighted average price of NRGÔÇÖs common stock during the ASR Term.
The exact number of shares repurchased pursuant to the ASR will be
determined based on such purchase price.

The Notes and related guarantees are being offered only to qualified
institutional buyers in reliance on Rule 144A under the Securities Act
of 1933, as amended (the ÔÇ£Securities ActÔÇØ). The offer and sale of the
Notes, the related guarantees and any shares of common stock potentially
issuable upon conversion of the Notes have not been registered under the
Securities Act or the securities laws of any other jurisdiction, and
those securities may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements. This press release does not constitute an offer to sell
the Notes, nor a solicitation for an offer to purchase the Notes.

About NRG

At NRG, weÔÇÖre redefining power by putting customers at the center of
everything we do. We create value by generating electricity and serving
nearly 3 million residential and commercial customers through our
portfolio of retail electricity brands. A Fortune 500 company, NRG
delivers customer-focused solutions for managing electricity, while
enhancing energy choice and working towards a sustainable energy future.

Forward-Looking Statements

This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934. These statements are subject to certain
risks, uncertainties and assumptions, and typically can be identified by
the use of words such as ÔÇ£will,ÔÇØ ÔÇ£expect,ÔÇØ ÔÇ£estimate,ÔÇØ ÔÇ£anticipate,ÔÇØ
ÔÇ£forecast,ÔÇØ ÔÇ£plan,ÔÇØ ÔÇ£believeÔÇØ 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 and whether
NRG will consummate the offering, the anticipated terms of the Notes and
the anticipated use of proceeds.

NRG undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise. The foregoing review of factors that could cause NRGÔÇÖs actual
results to differ materially from those contemplated in the
forward-looking statements included in this news release should be
considered in connection with information regarding risks and
uncertainties that may affect NRGÔÇÖs future results included in NRGÔÇÖs
filings with the Securities and Exchange Commission.

Contacts

For NRG Energy, Inc.
Media:
Marijke Shugrue,
609-524-5262
or
Investors:
Kevin L. Cole, CFA,
609-524-4526
or
Lindsey Puchyr, 609-524-4527