Energy Future Holdings Precedent Pack Volume 1 of 6

Energy Future
Holdings Corp.
Selected Chapter 11 Case
Documents & Relevant Precedent
Volume 1 of 6

Chapter11Dockets.com has collected key court filings (through May
6, 2014) in the Energy Future Holdings Chapter 11 cases as well as
precedential materials regarding motions to transfer venue of cases
before Bankruptcy Judge Christopher Sontchi, as well as plans of
reorganization proposed by selected energy industry debtors
represented by Kirkland & Ellis LLP in previous Chapter 11 cases.

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Table of Contents
Energy Future Holdings: First Day Motions & Applications (Volume 1 of 6)
Chapter 11 Voluntary Petition Filed by Energy Future Holdings Corp [Docket #1] ....... 16
Motion for Joint Administration [Docket # 17] .................................................................... 45
Motion for Entry of Interim and Final Orders Authorizing the Debtors to Pay Certain
Prepetition Taxes and Fees [Docket #23] ............................................................................ 89
Application to Appoint Claims/Noticing Agent [Docket #24] ....................................... 167
Motion for Entry of Interim and Final Orders (A) Authorizing the Debtors to (I) Pay
Certain Prepetition Compensation and Reimbursable Employee Expenses, (II) Pay
and Honor Employee and Retiree Medical and Similar Benefits, and (III) Continue
Employee and Retiree Benefit Programs, and (B) Modifying the Automatic Stay
[Docket #25] .......................................................................................................................... 207
Supplemental Declaration of Paul Keglevic, Executive Vice President, Chief Financial
Officer, and Co-Chief Restructuring Officer of Energy Future Holdings Corp., et al., in
Support of Wages and Benefits Motion [Docket #46] ..................................................... 265
Motion for Entry of Interim and Final Orders Determining Adequate Assurance of
Payment for Future Utility Services [Docket #26] .............................................................. 287
Motion for Entry of Interim and Final Orders Authorizing the Debtors to (A) Grant
Administrative Expense Priority to all Undisputed Obligations for Goods and Services
Ordered Prepetition and Delivered Postpetition and Satisfy Such Obligations in the
Ordinary Course of Business, and (B) Pay Prepetition Claims of Shippers,
Warehouseman, and Materialmen [Docket #27] ........................................................... 330
Motion for Entry of an Order Authorizing the Debtors to File a Consolidated List of
Creditors in Lieu of Submitting a Separate Mailing Matrix for Each
Debtor [Docket #28] ............................................................................................................ 360
Motion for Entry of Interim and Final Orders Authorizing the Debtors to Pay Prepetition
Critical Vendor Claims [Docket #29] ................................................................................. 373
Motion for Entry of (A) An Order Authorizing the Debtors to (I) Maintain and Administer
Customer Programs and Customer Agreements, (II) Honor Prepetition Obligations
Related Thereto, (III) Pay Certain Expenses on Behalf of Certain Organizations, (IV) Fix
the Deadline to File Proofs of Claim for Certain Customer Claims, and (V) Establish
Procedures for Notifying Customers of Commencement of the Debtors' Chapter 11
Cases, Assumption of Customer Agreement, and the Bar Date for Customer Claims
and (B) An Order Authorizing Certain of the Debtors to Assume the Customer
Agreements [Docket #31] ................................................................................................... 413

Motion Authorizing Texas Competitive Electric Holdings Company LLC and Certain of
its Debtor Affiliates to File Under Seal the Certain Fee Letter Related to Proposed
Debtor-in-Possession Financing [Docket #36]................................................................... 496
Motion for Entry of an Order (A) Authorizing the Debtors to (I) Continue Using Their
Existing Cash Management System, (II) Maintain Existing Bank Accounts and Business
Forms, and (III) Continue Using Certain Investment Accounts; (B) Authorizing
Continued Intercompany Transactions and Netting of Intercompany Claims; and (C)
Granting Postpetition Intercompany Claims Administrative Expense
Priority [Docket #37] ............................................................................................................. 513
Motion for Entry of (A) an Order Authorizing Certain of the Debtors to Pay Certain
Prepetition Transition Charges and Delivery Charges and (B) an Order Authorizing
Certain of the Debtors to Assume Transmission and Distribution Service Agreements
[Docket #38] .......................................................................................................................... 581
Motion Authorizing Energy Future Intermediate Holding Company LLC and EFIH
Finance, Inc. to File Under Seal the Certain Fee Letter Related to Proposed Debtor-in-
Possession Financing [Docket #39] .................................................................................... 620
Motion for Entry of an Order Authorizing Certain of the Debtors to Assume Standard
Form Market Participant Agreements with ERCOT [Docket #40] .................................. 638
Motion for Entry of Interim and Final Orders Authorizing the Debtors to (A) Continue
Performing Under Prepetition Hedging and Trading Arrangements, (B) Pledge
Collateral and Honor Obligations Thereunder, and (C) Enter Into and Perform Under
Trading Continuation Agreements and New Postpetition Hedging and Trading
Arrangements [Docket #41] ............................................................................................... 658
Motion of Texas Competitive Electric Holdings Company LLC and Certain of its Debtor
Affiliates for Entry of Interim and Final Orders (A) Authorizing Use of Cash Collateral, (B)
Granting Adequate Protection, (C) Modifying the Automatic Stay, and (D)
Scheduling a Final Hearing [Docket #71] ......................................................................... 726
Motion of Texas Competitive Electric Holdings Company LLC and Certain of its Debtor
Affiliates, for Entry of Interim and Final Orders (A) Approving Postpetition Financing, (B)
Granting Liens and Providing Superpriority Administrative Expense Claims, (C)
Modifying the Automatic Stay, and (D) Scheduling a Final Hearing [Docket #73] .... 832
Motion of Energy Future Intermediate Holding Company LLC and EFIH Finance, Inc.
for Entry of (I) an Interim Order (A) Approving Certain Fees Related to Postpetition
Financing and Granting Such Fees Administrative Expense Priority and (B) Scheduling
a Final Hearing; and (II) a Final Order (A) Approving Postpetition Financing, (B)
Authorizing the Use of Cash Collateral, (D) Authorizing the EFIH First Lien Refinancing,
(E) Authorizing Issuance of Roll-Up Debt to the Extent Authorized by the Settlement

Motion, (F) Determining the Value of Secured Claims, and (G) Modifying the
Automatic Stay [Docket #74] .......................................................................................... 1,123
Declaration of Paul Keglevic, Executive Vice President, Chief Financial Officer, and
Co-Chief Restructuring Officer of Energy Future Holdings Corp., et al., in Support of
First Day Motions [Docket #98] ........................................................................................ 1,219
Supplemental Declaration of Stephen Goldstein In Support of (I) the Motion of Texas
Competitive Electric Holdings Company LLC and Certain of its Debtors Affiliates for
Entry of Interim and Final Orders (A) Approving Postpetition Financing, (B) Granting
Liens and Providing Superpriority Administrative Expense Claims, (C) Modifying the
Automatic Stay, and (D) Scheduling a Final Hearing and (II) The Motion Authorizing
Texas Competitive Electric Holdings Company LLC and Certain of its Debtor Affiliates
to File Under Seal the Certain Fee Letter Related to Proposed Debtor-in-Possession
Financing [Docket #211] .................................................................................................. 1,683
Supplemental Declaration of Stephen Goldstein in Support of the Motion of Energy
Future Intermediate Holding Company LLC and EFIH Finance, Inc. for Entry of (I) an
Interim Order (A) Approving Certain Fees Related to Postpetition Financing and
Granting Such Fees Administrative Expense Priority and (B) Scheduling a Final Hearing;
and (II) a Final Order (A) Approving Postpetition Financing, (B) Granting Liens and
Providing Superpriority Administrative Expense Claims, (C) Authorizing the Use of Cash
Collateral, (D) Authorizing the EFIH First Lien Refinancing, (E) Authorizing Issuance of
Roll-Up Debt to the Extent Authorized by the Settlement Motion, (F) Determining the
Value of Secured Claims, and (G) Modifying the Automatic Stay [Docket #221] .. 1,687
Declaration of Terry L. Nutt in Support of the Motion of Energy Future Holdings Corp.,
et al., for Entry of Interim and Final Orders Authorizing the Debtors to (A) Continue
Performing Under Prepetition Hedging and Trading Arrangements, (B) Pledge
Collateral and Honor Obligations Thereunder, and (C) Enter into and Perform Under
Trading Continuation Agreements and New Postpetition Hedging and Trading
Arrangements [Docket #229] .......................................................................................... 1,695

Energy Future Holdings: Objections/Responses to First Day Pleadings (Volume 2 of 6)
Response of the Public Utility Commission of Texas in Support of Certain First Day
Pleadings [Docket #123] ....................................................................................................... 16
Preliminary Objection of EFIH 2nd Lien Notes Indenture Trustee and Certain
Noteholders to Motion for Interim Order Scheduling Final Hearing on Post-Petition
Financing [Docket #188] ....................................................................................................... 54
Preliminary Objection of the Ad Hoc Group of TCEH Unsecured Noteholders to the
Motion of the TCEH Debtors for Entry of an Order Directing Joint Administration of Their
Chapter 11 Cases With Those of the Oncor Debtors [Docket #222] .............................. 60
Emergency Motion of the Ad Hoc Group of TCEH Unsecured Noteholders for a Limited
Adjournment of the Hearing on First Day Motions [Docket #223] ................................... 98
Declaration of Jeffrey M. Schlerf, Esq. Related to Preliminary Objection of the Ad Hoc
Group of TCEH Unsecured Noteholders to the Motion of the TCEH Debtors for Entry of
an Order Directing Joint Administration of Their Chapter 11 Cases With Those of the
Oncor Debtors [Docket #227]............................................................................................. 122
Limited Preliminary Objection of the Ad Hoc Group of TCEH Unsecured Noteholders to
the Motion of Energy Future Holdings Corp., et al., for Entry of an Order (A) Authorizing
the Debtors to (I) Continue Using Their Existing Cash Management System, (II)
Maintain Existing Bank Accounts and Business Forms, and (III) Continue Using Certain
Investment Accounts; (B) Authorizing Continued Intercompany Transactions and
Netting of Intercompany Claims; and (C) Granting Postpetition Intercompany Claims
Administrative Expense Priority [Docket #230] .............................................................. 3,027
Omnibus Preliminary Objection Of The Ad Hoc Group Of TCEH Unsecured Noteholders
To (I) The Motion Of Texas Competitive Electric Holdings Company LLC And Certain
Of Its Debtor Affiliates For Entry Of Interim And Final Orders (A) Approving Postpetition
Financing, (B) Granting Liens And Providing Superpriority Administrative Expense
Claims, (C) Modifying The Automatic Stay, And (D) Scheduling A Final Hearing, And
(II) The Motion Of Texas Competitive Electric Holdings Company LLC And Certain Of
Its Debtor Affiliates For Entry Of Interim And Final Orders (A) Authorizing Use Of Cash
Collateral, (B) Granting Adequate Protection, (C) Modifying The Automatic Stay, And
(D) Scheduling A Final Hearing [Docket #231] .............................................................. 3,042
Declaration Of L. John Bird, Esq. in Support of Preliminary Objections of the Ad Hoc
Group of TCEH Unsecured Noteholders [Docket #232] ............................................... 3,075

Energy Future Holdings: First Day Orders (Volume 3 of 6)
Order (Interim) Directing Joint Administration of The Debtors' Chapter 11
Cases [Docket #287] .............................................................................................................. 16
Order (With Revisions Made By The Court) Authorizing Energy Future Intermediate
Holding Company LLC And EFIH Finance, Inc. To File Under Seal The Certain Fee Letter
Related To Proposed Debtor-In-Possession Financing [Docket #288]............................. 34
Order Approving Certain Fees Related To And Scheduling a Final Hearing On The
Proposed Postpetition Financing of Energy Future Intermediate Holding Company LLC
And EFIH Finance [Docket #289] .......................................................................................... 37
Order (With Revisions Made By The Court) Authorizing Texas Competitive Electric
Holdings Company LLC To File Under Seal The Certain Fee Letter Related To Proposed
Debtor-In-Possession Financing [Docket #290] .................................................................. 42
Order (Interim) (A) Authorizing The Debtors To (I) Continue Using Their Existing Cash
Management System, (II) Maintain Existing Bank Accounts And Business Forms, And
(III) Continue Using Certain Investment Accounts; (B) Authorizing Continued
Intercompany Transaction And Netting of Intercompany Claims; And (C) Granting
Postpetition Intercompany Claims Administrative Expense Priority [Docket #304] ....... 45
Order (Interim) Authorizing the Debtors to (A) Maintain and Administer Customer
Programs and Customer Agreements, (B) Honor Prepetition Obligations Related
Thereto, (C) Pay Certain Expenses on Behalf of Certain Organizations, (D) Fix the
Deadline to File Proofs of Claim for Certain Customer Claims, and (E) Establish
Procedures for Notifying Customers of Commencement of the Debtors' Chapter 11
Cases, Assumption of the Customer Agreements, and the Bar Date for Customer
Claims [Docket #307] ............................................................................................................. 54
Order (Interim) Authorizing The Debtors To Pay Prepetition Critical Vendor
Claims [Docket #309] ............................................................................................................. 83
Order (Interim) Authorizing the Debtors to (A) Grant Administrative Expense Priority to
all Undisputed Obligations for Goods and Services Ordered Prepetition and Delivered
Postpetition and Satisfy Such Obligations in the Ordinary Course of Business and (B)
Pay Prepetition Claims of Shippers, Warehousemen, and
Materialmen [Docket #314] .................................................................................................. 93
Order (Interim) Authorizing the Debtors to (A) Continue Performing Under Prepetition
Hedging and Trading Arrangements, (B) Pledge Collateral and Honor Obligations
Thereunder, and (C) Enter Into and Perform Under Trading Continuation Agreements
and New Postpetition Hedging and Trading Arrangements [Docket #315] ................. 98
Order (Interim) Authorizing Certain of the Debtors to Pay Certain Prepetition Transition
Charges and Delivery Charges [Docket #318] ................................................................ 114

Order (Interim) Determining Adequate Assurance of Payment For Future Utility
Services [Docket #319] ........................................................................................................ 118
Order (Interim) Authorizing the Debtors to Pay Certain Prepetition Taxes and
Fees [Docket #320] ............................................................................................................... 128
Order Approving the Retention and Appointment of Epiq Bankruptcy Solutions, LLC as
the Claims and Noticing Agent for the Debtors [Docket #321] .................................... 132
Order (Interim) (A) Authorizing the Debtors to (I) Pay Certain Prepetition
Compensation and Reimbursable Employee Expenses, (II) Pay and Honor Employee
and Retiree Medical and Similar Benefits, and (III) Continue Employee and Retiree
Benefit Programs, and (B) Modifying the Automatic Stay [Docket #322] .................... 138
Order Authorizing the Debtors to File a Consolidated List of Creditors in Lieu of
Submitting a Separate Mailing Matrix for Each Debtor [Docket #323] ........................ 143
Order (Interim) (With Revisions Made By The Court) (A)Authorizing Use of Cash
Collateral For Texas Competitive Electric Holdings Company LLC And Certain of Its
Affiliates, (B)Granting Adequate Protection, (C)Modifying The Automatic Stay, And
(D)Scheduling A Final Hearing [Docket #324] .................................................................. 146
Order (Interim) (With Revisions Made By The Court) (A)Approving Postpetition
Financing For Texas Competitive Electric Holdings Company LLC And Certain of Its
Debtor Affiliates, (B)Granting Liens And Providing Superpriority Administrative Expense
Claims, (C)Modifying The Automatic Stay, And (D)Scheduling A Final
Hearing [Docket #325] ......................................................................................................... 200

Energy Future Holdings: Venue Transfer & Related Pleadings (Volume 4 of 6)
Motion of Wilmington Savings Fund Society, FSB Pursuant to 28 U.S.C. 1408 & 1412
and Rule 1014 of the Federal Rules of Bankruptcy Procedure to Transfer Cases to the
United States District Court for the Northern District of Texas [Docket #5 (Replaced
Docket #2)] .............................................................................................................................. 16
Appendix to Motion of Wilmington Savings Fund Society, FSB Pursuant to 28 U.S.C.
1408 & 1412 and Rule 1014 of the Federal Rules of Bankruptcy Procedure to Transfer
Cases to the United States District Court for the Northern District of
Texas [Docket #3] ................................................................................................................... 56
Motion of Wilmington Savings Fund Society, FSB for Leave to Conduct Discovery
Pursuant to Rule 2004 of the Federal Rules of Bankruptcy Procedure of Energy Future
Holdings Corporation, Its Affiliates, and Certain Third Parties [Docket #6] ............... 1,013
Appendix to Motion of Wilmington Savings Fund Society, FSB for Leave to Conduct
Discovery Pursuant to Rule 2004 of the Federal Rules of Bankruptcy Procedure of
Energy Future Holdings Corporation, Its Affiliates, and Certain Third
Parties [Docket #7] ............................................................................................................ 1,093
Debtors' Response and Partial Opposition to the Motion of Wilmington Savings Fund
Society, FSB Pursuant to Rule 2002 and 9006 of the Federal Rules of Bankruptcy
Procedure and 11 U.S.C. Section 105(a) to Shorten Notice of, and Schedule Hearings
on, (I) Request to Transfer Venue; and (II) Request to Conduct Discovery Under Rule
2004 [Docket #203] ........................................................................................................... 3,189
Debtors' Motion to Quash Notice of Deposition of Paul Keglevic Filed by Energy Future
Holdings Corp. [Docket #214] .......................................................................................... 3,196
Limited Joinder of the Ad Hoc Group of TCEH Unsecured Noteholders to the Motion of
Wilmington Savings Fund Society, FSB Pursuant to 28 U.S.C. 1408 & 1412 and Rule
1014 of the Federal Rules of Bankruptcy Procedure to Transfer Cases to the United
States District Court for the Northern District of Texas [Docket #225] ......................... 3,204
Limited Joinder of the Ad Hoc Group of TCEH Unsecured Noteholders to the Motion of
Wilmington Savings Fund Society, FSB for Leave to Conduct Discovery Pursuant to Rule
2004 of the Federal Rules of Bankruptcy Procedure of Energy Future Holdings
Corporation, Its Affiliates, and Certain Third Parties [Docket #226] ........................... 3,214

Bankruptcy Judge Christopher S. Sontchi Venue Transfer Precedent (Volume 5 of 6)
ASHINC Corporation (f/k/a Allied Systems Holdings, Inc.) [Case No. 12-11564]
Motion to Change Venue/Inter-district Transfer - Bankruptcy to the United States
Bankruptcy Court for the Northern District of Georgia, Atlanta Division Filed by
Allied Systems Holdings, Inc. [Docket #29] ................................................................. 16
Objection of the Petitioning Creditors to Motion of the Alleged Debtors to
Transfer Venue of these Involuntary Cases to the United States Bankruptcy Court
for the Northern District of Georgia, Atlanta Division Filed by BDCM Opportunity
Fund II, LP, Black Diamond CLO 2005-1 Adviser L.L.C., Spectrum Investment
Partners LP [Docket #51] ............................................................................................... 29
Order Denying Motion of Alleged Debtors to Transfer Venue of These Cases to
the United States Bankruptcy Court for the Northern District of Georgia, Atlanta
Division [Docket #60] ................................................................................................... 203
Transcript regarding Hearing Held 5/31/12 Regarding the Motion to Transfer
Venue [Docket #62] .................................................................................................... 205
Cordillera Golf Club, LLC [Case No. 12-11893]
Motion of Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary
Jackson and Kevin B. Allen, Individually and as Representatives of a Certified
Class of Members, to Transfer Venue [Docket #69] ................................................ 265
Joinder of Alpine Bank to the Motion of Cheryl M. Foley, Thomas Wilner, Jane
Wilner, Charles Jackson, Mary Jackson and Kevin B. Allen, Individually and as
Members of a Certified Class of Members, to Transfer Venue [Docket #77] ...... 425
Motion of Cordillera Property Owners Association, Inc. and Cordillera
Metropolitan District to Transfer Venue to Colorado and Joinder in the Motion of
Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary Jackson and
Kevin B. Allen, Individually and as Representatives of a Certified Class of
Members, to Transfer Venue [Docket #78] ............................................................... 435
Joinder of Alpine Bank to the Motion of Cordillera Property Owners Association,
Inc. and Cordillera Metropolitan District to Transfer Venue to
Colorado [Docket #95] ............................................................................................... 478
Joinder of the Official Committee of Unsecured Creditors in: (I) Motion of Cheryl
M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary Jackson and Kevin
B. Allen, Individually and as Representatives of a Certified Class of Members, to
Transfer Venue; and (II) Motion of Cordillera Property Owners Association, Inc.
and Cordillera Metropolitan District to Transfer Venue to
Colorado [Docket #117] ............................................................................................. 480
Omnibus Objection to the Motions to Transfer Venue and/or Related Joinders
Filed By (I) Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary

Jackson and Kevin B. Allen, Individually and as Representatives of a Certified
Class of Members, (II) Alpine Bank, (III) Cordillera Property Owners Association,
Inc. and Cordillera Metropolitan District Filed by Cordillera Golf
Club, LLC [Docket #118] ............................................................................................. 490
Declaration of Daniel L. Fitchett, Jr. in Support of the Debtor's Omnibus Objection
to the Motions to Transfer Venue and/or Related Joinders Filed By (I) Cheryl M.
Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary Jackson and Kevin B.
Allen, Individually and as Representatives of a Certified Class of Members, (II)
Alpine Bank, (III) Cordillera Property Owners Association, Inc. and Cordillera
Metropolitan District Filed by Cordillera Golf Club, LLC [Docket #119] ................ 522
Joinder of Creditor Jeffrey Rush, M.D. as Trustee of the Rush Family Trust UTD May
8, 1985, to Objection of Debtor to (I) Motion of Cheryl M. Foley, Thomas Wilner,
Jane Wilner, Charles Jackson, Mary Jackson and Kevin B. Allen, Individually and
as Representatives of a Certified Class of Members, to Transfer Venue, (II) Motion
of Cordillera Property Owners Association, Inc. and Cordillera Metropolitan
District to Transfer Venue to Colorado and Joinder in the Motion of Cheryl M.
Allen, Individually and as Representatives of a Certified Class of Members, to
Transfer Venue, and (III) Joinders of Alpine Bank in Venue Transfer
Motions [Docket #120] ................................................................................................ 526
Southlight Trust I's Joinder to Objection of Debtor to the Motion of Cheryl M.
Allen, Individually and as Representatives of a Certified Class of Members, to
Transfer Venue and Related Motions and Joinders by Alpine Bank, CPOA and the
District [Docket #121] ................................................................................................... 532
Declaration of Harold Bordwin in Support of and Joinder to Objection to Motion
to Change Venue Filed by Cordillera Golf Club, LLC [Docket #122] ................... 535
Joinder of Homeowner Walter Carey to Objection of Debtor to the Motion of
Members, to Transfer Venue and Related Motions and Joinders by Alpine Bank,
CPOA and the District [Docket #123] ....................................................................... 540
Joinder of Homeowner Dan Bennett to Objection of Debtor to the Motion of
Joinder Of David A. Wilhelm To Objection Of Debtor To (I) Motion Of Cheryl M.
Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary Jackson And Kevin B.

Allen, Individually And As Representatives Of A Certified Class Of Members, To
Transfer Venue, (II) Motion Of Cordillera Property Owners Association, Inc. And
Cordillera Metropolitan District To Transfer Venue To Colorado And Joinder In The
Motion Of Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary
Jackson And Kevin B. Allen, Individually And As Representatives Of A Certified
Class Of Members, To Transfer Venue, And (III) Joinders Of Alpine Bank In Venue
Transfer Motions [Docket #126] .................................................................................. 544
Joinder of Homeowner Joseph Perry to Objection of Debtor to the Motion of
Notice of Filing of Exhibits to (A) Declaration of Daniel L. Fitchett, Jr. in Support of
the Debtor's Omnibus Objection to the Motions to Transfer Venue and/or Related
Joinders Filed By (I) Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson,
Mary Jackson and Kevin B. Allen, Individually and as Representatives of a
Certified Class of Members, (II) Alpine Bank, (III) Cordillera Property Owners
Association, Inc. and Cordillera Metropolitan District and (B) Declaration of
Harold Bordwin in Support of and Joinder to Objection to Motion to Change
Venue [Docket #129] .................................................................................................. 548
Joinder of Homeowner Edward O'Brien to Objection of Debtor to the Motion of
Order Granting Motion To Change Venue to The United States Bankruptcy Court
for The District of Colorado [Docket #190] ............................................................... 558
Venue [Docket #195] .................................................................................................. 560
Saab Cars North America, Inc. [Case No. 12-10344]
Motion to Change Venue/Inter-district Transfer - Bankruptcy Filed by Saab Cars
North America, Inc. [Docket #16] .............................................................................. 768
Response of Caterpillar Logistics Services, LLC in Support of Motion of Saab Cars
North America to Transfer Venue of Case to Eastern District of
Michigan [Docket #34] ................................................................................................ 831
Opposition of the Dealer Franchisees to the Motion of the Alleged Debtor to
Transfer Venue to Michigan [Docket #35] ................................................................ 836

Reply in Support of Motion of Saab Cars North America, Inc. for Order Transferring
Venue of Case to Bankruptcy Court for the Eastern District of Michigan Filed by
Saab Cars North America, Inc. [Docket #38] .......................................................... 917
Exhibit A to Reply in Support of Motion of Saab Cars North America, Inc. for Order
Transferring Venue of Case to Bankruptcy Court for the Eastern District of
Michigan [Docket #40] ................................................................................................ 926
Order Denying Motion to Change Venue/Inter-district Transfer [Docket #44] ... 929
Venue [Docket #89] .................................................................................................... 930

Selected Kirkland & Ellis LLP Energy Industry Debtor Representation
Precedent (Volume 6 of 6)
Calpine Corp. [Bankr. S.D.N.Y. Case No. 05-60200]
Debtors' Sixth Amended Joint Plan of Reorganization Pursuant to Chapter 11 of
the United States Bankruptcy Code [Docket #7237] ................................................ 16
Findings of Fact, Conclusions of Law, and Order signed on 12/19/2007 Confirming
Sixth Amended Joint Plan of Reorganization Pursuant to Chapter 11 of the
Bankruptcy Code [Docket #7256] ............................................................................. 110
Edison Mission Energy [Bankr. N.D. Ill. Case No. 12-49219]
Order Confirming Joint Chapter 11 Plan of Reorganization (Confirmed Third
Amended Joint Chapter 11 Plan of Reorganization (with Technical Modifications)
Attached as Exhibit A) [Docket #2206] ..................................................................... 152
Longview Power, LLC [Bankr. D. Del. Case No. 13-12211]
First Amended Joint Plan of Reorganization Pursuant to Chapter 11 of the
Bankruptcy Code [Docket #1139] ............................................................................. 252
North American Petroleum Corporation USA [Bankr. D. Del. Case No. 10-11707]
First Amended Joint Chapter 11 Plan [Docket No. 970] ......................................... 376
Findings of Fact, Conclusions of Law and Order Confirming the First Amended
Joint Chapter 11 Plan [Docket No. 1056] .................................................................. 418

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Case 14-10979 Doc 1 Filed 04/29/14 Page 1 of 29
Case 14-10979-CSS Doc 17 Filed 04/29/14 Page 1 of 44
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
)
In re: ) Chapter 11
)
ENERGY FUTURE HOLDINGS CORP., et al.,
1
)
)
Case No. 14-_______ (___)
Debtors. ) (J oint Administration Requested)
)

APPLICATION OF ENERGY FUTURE HOLDINGS
CORP., ET AL., FOR ENTRY OF AN ORDER APPROVING
THE RETENTION AND APPOINTMENT OF EPIQ BANKRUPTCY
SOLUTIONS, LLC AS THE CLAIMS AND NOTICING AGENT FOR THE DEBTORS

The above-captioned debtors and debtors in possession (collectively, the Debtors) file
this application (this Application) for the entry of an order (the Order), substantially in the
form attached hereto as Exhibit A, authorizing the Debtors to employ and retain Epiq
Bankruptcy Solutions, LLC (Epiq) as their claims and noticing agent (Claims and Noticing
Agent). In support of this Application, the Debtors submit the Declaration of James
Katchadurian, Executive Vice President, at Epiq Bankruptcy Solutions, LLC
(the Katchadurian Declaration), attached hereto as Exhibit B. In further support of this
Application, the Debtors respectfully state as follows.
2

1 The last four digits of Energy Future Holdings Corp.s tax identification number are 8810. The location of the
debtors service address is 1601 Bryan Street, Dallas, Texas 75201. Due to the large number of debtors in these
chapter 11 cases, for which the debtors have requested joint administration, a complete list of the debtors and
the last four digits of their federal tax identification numbers is not provided herein. A complete list of such
information may be obtained on the website of the debtors proposed claims and noticing agent at
http://www.efhcaseinfo.com.
2
The facts and circumstances with respect to these chapter 11 cases and in support of this Application are set
forth in the Declaration of Paul M. Keglevic, Executive Vice President, Chief Financial Officer, and Co-Chief
Restructuring Officer of Energy Future Holdings Corp., et al., In Support of First Day Motions (the First Day
Declaration), filed contemporaneously herewith.
2
Jurisdiction and Venue
1. The United States Bankruptcy Court for the District of Delaware (the Court)
has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended
Standing Order of Reference from the United States District Court for the District of Delaware,
dated February 29, 2012. This matter is a core proceeding within the meaning of 28 U.S.C.
157(b)(2), and the Debtors consent pursuant to rule 9013-1(f) of the Local Rules of Bankruptcy
Practice and Procedure of the United States Bankruptcy Court for the District of Delaware
(the Local Bankruptcy Rules) to the entry of a final order by the Court in connection with this
Application to the extent that it is later determined that the Court, absent consent of the parties,
cannot enter final orders or judgments in connection herewith consistent with Article III of the
United States Constitution.
2. Venue is proper pursuant to 28 U.S.C. 1408 and 1409.
3. The bases for the relief requested in this Application are section 156(c) of title 28
of the United States Code (the J udicial Code), sections 105(a) and 363 of title 11 of the United
States Code (the Bankruptcy Code), Local Bankruptcy Rule 2002-1(f), and the Courts
Protocol for the Employment of Claims and Noticing Agents under 28 U.S.C. 156(c), instituted
by the Clerk on February 1, 2012 (the Claims Agent Protocol).
Relief Requested
4. By this Application, the Debtors seek entry of an Order authorizing the
employment and retention of Epiq as the Debtors Claims and Noticing Agent, in lieu of the
Clerk of the Court (the Clerk), in accordance with the terms and conditions set forth in that
certain engagement letter dated as of March 20, 2013, as amended by that certain amendment
dated as of J anuary 7, 2014, between Energy Future Holdings Corp. (EFH Corp.), Energy
Future Intermediate Holding Company LLC (EFIH), Energy Future Competitive Holdings
3
Company (EFCH), Texas Competitive Electric Holdings Company LLC (TCEH LLC and
collectively with EFH Corp., EFCH, and EFIH, the Company Parties), attached hereto as
Exhibit C and incorporated herein by reference (the Engagement Letter).
Services to Be Provided
5. This Application pertains only to the work to be performed by Epiq under the
Clerks delegation of duties permitted by section 156(c) of the J udicial Code, Local Bankruptcy
Rule 2002-1(f), and the Claims Agent Protocol, and any work to be performed by Epiq outside of
this scope is not covered by this Application or by any order granting approval thereof.
3

Specifically, Epiq will perform, to the extent the Debtors request, the following services in its
role as Claims and Noticing Agent (the Claims and Noticing Services), as well as all quality
control relating thereto:
(a) preparing and serving required notices and documents in the cases in
accordance with the Bankruptcy Code and the Bankruptcy Rules in the form
and manner directed by the Debtors and/or the Court, including, if applicable
(i) notice of the commencement of the cases and the initial meeting of
creditors under Bankruptcy Code 341(a); (ii) notices of any claims bar date;
(iii) notices of transfers of claims; (iv) notices of objections to claims and
objections to transfers of claims; (v) notices of any hearings on a disclosure
statement and confirmation of a plan of reorganization, including under
Bankruptcy Rule 3017(d); (vi) notice of the effective date of any plan; and
(vii) all other notices, orders, pleadings, publications, and other documents as
the Debtors and/or the Court may deem necessary or appropriate for an
orderly administration of the chapter 11 cases;
(b) maintaining an official copy of the Debtors schedules of assets and liabilities
and statement of financial affairs (collectively, the Schedules), listing the
Debtors known creditors and the amounts owed thereto;
(c) maintaining (i) a list of all potential creditors, equity holders and other parties-
in-interest; and (ii) a core mailing list consisting of all parties described in

3
Contemporaneously with the filing of this Application, the Debtors have filed theApplication of Energy Future
Holdings Corp., et al., for Entry of an Order Approving the Employment and Retention of Epiq Bankruptcy
Solutions, LLC as the Administrative Advisor for the Debtors, Effective Nunc Pro Tunc to the Petition Date,
whereby they seek to employ Epiq to provide certain bankruptcy administrative services to the Debtors during
these chapter 11 cases.
4
sections 2002(i), (j) and (k) and those parties that have filed a notice of
appearance pursuant to Bankruptcy Rule 9010; update said lists and make said
lists available upon request by a party-in-interest or the Clerk;
(d) furnishing a notice to all potential creditors of the last date for the filing of
proofs of claim and a form for the filing of a proof of claim, after such notice
and form are approved by the Court, and notify said potential creditors of the
existence, amount, and classification of their respective claims as set forth in
the Schedules, which may be affected by inclusion of such information (or
lack thereof, in cases where the Schedules indicate no debt due to the subject
party) on a customized proof of claim form provided to potential creditors;
(e) maintaining a post office box or address for the purpose of receiving claims
and returned mail, and processing all mail received;
(f) for all notices, motions, orders or other pleadings or documents served,
preparing and filing or causing to be filed with the Clerk an affidavit or
certificate of service within seven (7) business days of service which includes
(i) either a copy of the notice served or the docket numbers(s) and title(s) of
the pleading(s) served, (ii) a list of persons to whom it was mailed (in
alphabetical order) with their addresses, (iii) the manner of service, and
(iv) the date served;
(g) processing all proofs of claim received, including those received by the
Clerks office, and checking said processing for accuracy, and maintaining the
original proofs of claim in a secure area;
(h) maintaining the official claims register for each Debtor (the Claims
Registers) on behalf of the Clerk and upon the Clerks request, providing the
Clerk with certified, duplicate unofficial Claims Registers; and specifying in
the Claims Registers the following information for each claim docketed:
(i) the claim number assigned; (ii) the date received; (iii) the name and
address of the claimant and agent, if applicable, who filed the claim, (iv) the
amount asserted; (v) the asserted classification(s) of the claim (e.g., secured,
unsecured, priority, etc.); (vi) the applicable Debtor; and (vii) any disposition
of the claim;
(i) implementing necessary security measures to ensure the completeness and
integrity of the Claims Registers and the safekeeping of the original claims;
(j) recording all transfers of claims and providing any notices of such transfers as
required by Bankruptcy Rule 3001(e);
(k) relocating, by messenger or overnight delivery, all of the court-filed proofs of
claim to the offices of Epiq, not less than weekly;
5
(l) upon completion of the docketing process for all claims received to date for
each case, turning over to the Clerk copies of the Claims Registers for the
Clerks review (upon the Clerks request);
(m) monitoring the Courts docket for all notices of appearance, address changes,
and claims-related pleadings and orders filed, and making necessary notations
on and/or changes to the Claims Registers;
(n) assisting in the dissemination of information to the public and responding to
requests for administrative information regarding the cases, as directed by the
Debtors and/or the Court, including through the use of a case website and/or
call center;
(o) if the case is converted to chapter 7, contact the Clerks Office within three
days notice to Epiq of entry of the order converting the case;
(p) thirty days prior to the close of these cases, to the extent practicable,
requesting that the Debtors submit to the Court a proposed order dismissing
Epiq and terminating Epiqs services upon completion of its duties and
responsibilities and upon the closing of these cases;
(q) within seven days notice to Epiq of entry of an order closing the chapter 11
cases, providing to the Court the final version of the Claims Registers as of
the date immediately before the close of the cases; and
(r) at the close of these cases, boxing and transporting all original documents, in
proper format, as provided by the Clerks office, to (i) the Federal Archives
Record Administration, located at Central Plains Region, 200 Space Center
Drive, Lees Summit, Missouri 64064; or (ii) any other location requested by
the Clerks Office.
6. The Claims Registers shall be open to the public for examination without charge
during regular business hours and on a case-specific website maintained by Epiq. For the
avoidance of doubt, pursuant to the Engagement Letter, Epiq will perform the Claims and
Noticing Services for Energy Future Holdings Corp. and its direct and indirect subsidiaries, other
than Oncor Holdings LLC and its subsidiaries.
Epiqs Qualifications
7. Epiq is one of the countrys leading chapter 11 administrators, with significant
experience in noticing, claims administration, solicitation, balloting, and facilitating other
6
administrative aspects of chapter 11 cases. Epiq has substantial experience providing services,
including claims and noticing services, in matters comparable in size and complexity to this
matter.
8. Since its inception in 1988, Epiq has provided claims and noticing services in
numerous large cases in this district, including most recently: In re F & H Acquisition Corp.,
No. 13-13220 (Bankr. D. Del. Dec. 17, 2013); In re EWGS Intermediary, LLC, No. 13-12876
(Bankr. D. Del. Nov. 5, 2013); In re Furniture Brands Intl, Inc., No. 13-12329 (Bankr. D. Del.
Sept. 9, 2013); In re The SCOOTER Store Holdings, Inc., No. 13-10904 (PJ W) (Bankr. D. Del.
Apr. 15, 2013); In re Rotech Healthcare Inc., Case No. 13-10741 (PJ W) (Bankr. D. Del. Apr. 8,
2013); In re Dex One Corp., No. 13-10533 (Bankr. D. Del. Mar. 19, 2013); In re SuperMedia
Inc., No. 13-10545 (Bankr. D. Del. Apr. 10, 2013); In re Prince Sports, Inc., No. 12-11439
(Bankr. D. Del. May 2, 2012); In re Bicent Holdings LLC, Case No. 12-11304 (KG) (Bankr. D.
Del. Apr. 24, 2012); In re LAD, LLC, No. 11-12010 (KG) (Bankr. D. Del. J une 27, 2011); In re
Allen Family Foods, Inc., No. 11-11764 (KJ C) (Bankr. D. Del. J une 9, 2011); In re Signature
Styles, LLC, No. 11-11733 (KG) (Bankr. D. Del. J une 6, 2011); In re Indianapolis Downs, LLC,
No. 11-11046 (BLS) (Bankr. D. Del. Apr. 7, 2011); In re Anchor Blue Holding Corp.,
No. 11-10110 (PJ W) (Bankr. D. Del. J an. 11, 2011); In re Consol. Horticulture Grp. LLC, No.
10-13308 (J CB) (Bankr. D. Del. Oct. 12, 2010); In re Trico Marine Servs., Inc., No. 10-12653
(BLS) (Bankr. D. Del. Aug. 25, 2010).
4

9. By appointing Epiq as the Claims and Noticing Agent in these cases, the
distribution of notices and the processing of claims will be expedited, and the Clerks office will
be relieved of the administrative burden of processing such claims.

4
Because of the voluminous nature of the orders cited herein, such orders are not attached to this Application.
Copies of these orders are available upon request of the Debtors counsel.
7
Compensation and Representation of Disinterestedness
10. The Debtors respectfully request that the undisputed fees and expenses incurred
by Epiq in the performance of the above services be treated as administrative expenses of the
Debtors estates pursuant to section 503(b)(1)(A) of the Bankruptcy Code and be paid in the
ordinary course of business without further application to or order of the Court. Epiq agrees to
maintain records of all services showing dates, categories of services, fees charged, and expenses
incurred, and to serve monthly invoices on the Debtors, the Office of the United States Trustee,
counsel for the Debtors, counsel for any official committee, if any, monitoring the expenses of
the Debtors, and any party in interest who specifically requests service of the monthly invoices.
If any dispute arises relating to the Engagement Letter or monthly invoices, the parties shall meet
and confer in an attempt to resolve the dispute. If resolution is not achieved, the parties may
seek resolution of the matter from the Court.
11. Prior to the Petition Date, the Debtors provided Epiq a retainer in the amount of
$100,000. Epiq seeks to hold the retainer under the Engagement Letter during these chapter 11
cases as security for the payment of fees and expenses incurred under the Engagement Letter.
12. In connection with its retention as the Claims and Noticing Agent, Epiq represents
in the Katchadurian Declaration, among other things, that:
(a) Epiq will not consider itself employed by the United States government and
shall not seek any compensation from the United States government in its
capacity as the Claims and Noticing Agent in the cases;
(b) by accepting employment in the cases, Epiq waives any rights to receive
compensation from the United States government in connection with the
Debtors cases;
(c) in its capacity as the Claims and Noticing Agent in the cases, Epiq will not be
an agent of the United States and will not act on behalf of the United States;
and
8
(d) it is a disinterested person as that term is defined in section 101(14) of the
Bankruptcy Code with respect to the matters upon which it is to be engaged.
13. To the extent that there is any inconsistency between this Application, the Order,
and the Engagement Letter, the Debtors respectfully submit that the Order shall govern.
Compliance with the Claims Agent Protocol
14. The Debtors represent that this Application complies with the Claims Agent
Protocol and conforms to the standard section 156(c) application used in this district.
Basis for Relief
15. This Application is made pursuant to section 156(c) of the J udicial Code,
section 105(a) of the Bankruptcy Code, Local Bankruptcy Rule 2002-1(f), and the Claims Agent
Protocol for an Order appointing Epiq as the Claims and Noticing Agent in order to assume full
responsibility for the distribution of notices and the maintenance, processing, and docketing of
proofs of claim filed in the Debtors cases.
16. Section 156 of the J udicial Code, in relevant part, provides:
Any court may utilize facilities or services, either on or off the
courts premises, which pertain to the provision of notices,
dockets, calendars, and other administrative information to parties
in cases filed under the provisions of title 11, United States Code,
where the costs of such facilities or services are paid for out of the
assets of the estate and are not charged to the United States. The
utilization of such facilities or services shall be subject to such
conditions and limitations as the pertinent circuit council may
prescribe.
28 U.S.C. 156(c).
17. Section 105 of the Bankruptcy Code, in relevant part, provides:
The court may issue any order, process, or judgment that is
necessary or appropriate to carry out the provisions of this title. No
provision of this title providing for the raising of an issue by a
party in interest shall be construed to preclude the court from, sua
sponte, taking any action or making any determination necessary
9
or appropriate to enforce or implement court orders or rules, or to
prevent an abuse of process.
11 U.S.C. 105(a).
18. Local Bankruptcy Rule 2002-1(f) provides:
Upon motion of the debtor or trustee, at any time without notice or
hearing, the Court may authorize the retention of a notice and/or
claims clerk under 28 U.S.C. 156(c). In all cases with more than
200 creditors or parties in interest listed on the creditor matrix,
unless the Court orders otherwise, the debtor shall file such motion
on the first day of the case or within seven (7) days thereafter. The
notice and/or claims clerk shall comply with the Protocol for the
Employment of Claims and Noticing Agents under 28 U.S.C.
156(c) (which can be found on the Courts website) and shall
perform the [Claims and Noticing Services].
Del. Bankr. L.R. 2002-1(f).
19. In accordance with the Claims Agent Protocol, before the selection of Epiq, the
Debtors reviewed and compared engagement proposals from three court-approved claims and
noticing agents, including Epiq, to ensure selection through a competitive process. The Debtors
submit, based on the engagement proposals obtained and reviewed, that Epiqs rates are
competitive and reasonable given Epiqs quality of services and expertise. The terms of Epiqs
retention are set forth in the Engagement Letter; provided, however, that Epiq is seeking by this
Application approval solely of the terms and provisions as set forth in this Application and the
Order as set forth in Exhibit A.
20. The Debtors anticipate that there will be more than 200 entities to be noticed. In
light of the number of anticipated claimants and the complexity of the Debtors businesses, the
Debtors submit that the appointment of Epiq as the Claims and Noticing Agent is both necessary
and in the best interests of the Debtors estates and their creditors because the Debtors will be
relieved of the burdens associated with the Claims and Noticing Services. Accordingly, the
10
Debtors will be able to devote their full attention and resources to the restructuring efforts
described above.
Notice
21. The Debtors shall provide notice of this Motion on the date hereof via facsimile,
overnight delivery, and/or hand delivery to: (a) the Office of the U.S. Trustee for the District of
Delaware; (b) the entities listed on the Consolidated List of Creditors Holding the 50 Largest
Unsecured Claims filed pursuant to Bankruptcy Rule 1007(d); (c) Citibank, N.A., in its capacity
as administrative agent under the TCEH first lien credit agreement and collateral agent under the
TCEH intercreditor agreements and counsel thereto; (d) Bank of New York Mellon Trust
Company, N.A., in its capacity as indenture trustee under: (i) the TCEH unsecured pollution
control revenue bonds; and (ii) the EFCH 2037 Notes due 2037, and counsel thereto;
(e) American Stock Transfer & Trust Company, LLC, in its capacity as indenture trustee under:
(i) the 9.75% EFH senior unsecured notes due 2019; (ii) the 10.0% EFH senior unsecured notes
due 2020; (iii) the 10.875% EFH LBO senior unsecured notes due 2017; (iv) the 11.25%/12.0%
EFH LBO toggle notes due 2017; (v) the 5.55% EFH legacy notes (series P) due 2014; (vi) the
6.50% EFH legacy notes (series Q) due 2024; and (vii) the 6.55% EFH legacy notes (series R)
due 2034, and counsel thereto; (f) Computershare Trust Company, N.A. and Computershare
Trust Company of Canada, in their capacities as indenture trustee under: (i) the 11.0% EFIH
senior secured second lien notes due 2021; and (ii) the 11.75% EFIH senior secured second lien
notes due 2022, and counsel thereto; (g) UMB Bank, N.A. in its capacity as indenture trustee
under: (i) the 9.75% EFIH senior unsecured notes due 2019; and (ii) the 11.25%/12.25% EFIH
senior toggle notes due 2018, and counsel thereto; (h) BOKF, NA, dba Bank of Arizona, in its
capacity as indenture trustee under 11.50% TCEH senior secured notes due 2020, and counsel
11
thereto; (i) CSC Trust Company of Delaware in its capacity as indenture trustee under: (i) the
6.875% EFIH senior secured notes due 2017; and (ii) the 10.0% EFIH senior secured notes due
2020, and counsel thereto; (j) Law Debenture Trust Company of New York in its capacity as
indenture trustee under: (i) the 10.25% TCEH senior unsecured notes due 2015; and (ii) the
10.50%/11.25% TCEH senior toggle notes due 2016, and counsel thereto; (k) Wilmington
Savings Fund Society, FSB in its capacity as indenture trustee under the 15.0% TCEH senior
secured second lien notes due 2021, and counsel thereto; (l) counsel to certain holders of claims
against the Debtors regarding each of the foregoing described in clauses (c) through (k); (m) the
agent for the TCEH debtor-in-possession financing facility and counsel thereto; (n) the agent for
the EFIH debtor-in-possession financing facility and counsel thereto; (o) counsel to certain
holders of equity in Texas Energy Future Holdings Limited Partnership; (p) counsel to Oncor;
(q) the SEC; (r) the Internal Revenue Service; (s) the Office of the United States Attorney for the
District of Delaware; (t) the Office of the Texas Attorney General on behalf of the PUC; and
(u) counsel to ERCOT. As this Motion is seeking first day relief, within forty eight hours of
the entry of the Interim Order, the Debtors will serve copies of this Motion and the order
respecting this Motion as required by Local Bankruptcy Rule 9013-1(m). The Debtors submit
that, in light of the nature of the relief requested, no other or further notice need be given.
No Prior Request
22. No prior request for the relief sought in this Application has been made to this or
any other court.
[Remainder of page intentionally left blank.]

April 29, 2014

EXHIBIT A
Proposed Order

Case 14-10979-CSS Doc 24-1 Filed 04/29/14 Page 1 of 6

)
In re: ) Chapter 11
)
1
)
)
Case No. 14-_______ (___)
)

ORDER APPROVING THE RETENTION AND
APPOINTMENT OF EPIQ BANKRUPTCY SOLUTIONS, LLC
AS THE CLAIMS AND NOTICING AGENT FOR THE DEBTORS

Upon the application (the Application)
2
of the above-captioned debtors and debtors in
possession (collectively, the Debtors), for entry of an order (this Order) authorizing the
Debtors to retain and employ Epiq Bankruptcy Solutions, LLC (Epiq) as the Claims and
Noticing Agent to the Debtors; all as more fully set forth in the Application, and upon the First
Day Declaration, and upon the Katchadurian Declaration; and the Court having found that it has
jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334; and the Court having found
that this is a core proceeding pursuant to 28 U.S.C. 157(b)(2); and the Court having found that
venue of this proceeding and the Application in this district is proper pursuant to 28 U.S.C.
1408 and 1409; and the Court having found that the relief requested in the Application is in
the best interests of the Debtors estates, their creditors, and other parties in interest; and the
Court having found that the Debtors provided appropriate notice of the Application and

1 The last four digits of Energy Future Holdings Corp.s tax identification number are 8810. The location of the
2
Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the
Application.

2
opportunity for a hearing on the Application under the circumstances; and the Court having
reviewed the Application and having heard the statements in support of the relief requested
therein at a hearing before the Court (the Hearing); and the Court having determined that the
legal and factual bases set forth in the Application and at the Hearing establish just cause for the
relief granted herein; and upon all of the proceedings had before the Court; and after due
deliberation and sufficient cause appearing therefor, it is HEREBY ORDERED THAT:
1. The Application is granted to the extent provided herein.
2. Notwithstanding the terms of the Engagement Letter attached to the Application,
the Application is approved solely as set forth in this Order.
3. The Debtors are authorized pursuant to section 156(c) of the J udicial Code,
sections 363 and 105(a) of the Bankruptcy Code, Local Bankruptcy Rule 2002-1(f), and the
Claims Agent Protocol to retain Epiq as Claims and Noticing Agent to the Debtors in accordance
with the terms of the Engagement Letter attached to the Application as Exhibit C, and Epiq is
authorized and directed to perform noticing services, and to receive, maintain, record, and
otherwise administer the proofs of claim filed in these cases, and all related tasks, all as
described in the Application (the Claims and Noticing Services).
4. Epiq shall serve as the custodian of court records and shall be designated as the
authorized repository for all proofs of claim filed in these cases and is authorized and directed to
maintain official claims registers for each of the Debtors and to provide the Clerk with a certified
duplicate thereof upon the request of the Clerk.
5. Epiq is authorized and directed to obtain a post office box or address for the
receipt of proofs of claim.

3
6. Epiq is authorized to take such other action to comply with all duties set forth in
the Application.
7. The Debtors are authorized to compensate Epiq in accordance with the terms of
the Engagement Letter upon the receipt of reasonably detailed invoices setting forth the services
provided by Epiq and the rates charged for each, and to reimburse Epiq for all reasonable and
necessary expenses it may incur, upon the presentation of appropriate documentation, without
the need for Epiq to file fee applications or otherwise seek Court approval for the compensation
of its services and reimbursement of its expenses.
8. Epiq shall maintain records of all services showing dates, categories of services,
fees charged, and expenses incurred, and shall serve monthly invoices on the Debtors, the Office
of the United States Trustee, counsel for the Debtors, counsel for an official committee, if any,
monitoring the expenses of the Debtors, and any party in interest who specifically requests
service of the monthly invoices.
9. The parties shall meet and confer in an attempt to resolve any dispute which may
arise relating to the Engagement Letter or monthly invoices, and the parties may seek resolution
of the matter from the Court if resolution is not achieved.
10. Notwithstanding paragraph 10.3 in the Engagement Letter, any controversy or
claim arising out of or relating to the Engagement Letter shall first be submitted to the Court for
resolution and, if the Court permits, to arbitration in accordance with the terms of Engagement
Letter.
11. Pursuant to section 503(b)(1)(A) of the Bankruptcy Code, the fees and expenses
of Epiq under this Order shall be an administrative expense of the Debtors estates.

4
12. Epiq may hold its retainer under the Engagement Letter during the chapter 11
cases as security for the payment of fees and expenses incurred under the Engagement Letter.
13. The indemnification provisions in the Engagement Letter are approved, subject to
the following modifications, applicable during the pendency of these cases:
(a) Epiq shall not be entitled to indemnification, contribution, or reimbursement
pursuant to the Engagement Letter for services other than those described in
the Engagement Letter, unless such services and indemnification therefor are
approved by the Bankruptcy Court;
(b) Notwithstanding anything to the contrary in the Engagement Letter, the
Debtors shall have no obligation to indemnify Epiq, or provide contribution or
reimbursement to Epiq, for any claim or expense that is either: (i) judicially
determined (the determination having become final) to have arisen from
Epiqs gross negligence, willful misconduct or fraud; (ii) for a contractual
dispute in which the Debtors allege the breach of Epiqs contractual
obligations if the Court determines that indemnification, contribution or
reimbursement would not be permissible pursuant to In re United Artists
Theatre Co., et al., 315 F.3d 217 (3d Cir. 2003) or (iii) settled prior to a
judicial determination under (i) or (ii), but determined by this Court, after
notice and a hearing, to be a claim or expense for which Epiq should not
receive indemnity, contribution or reimbursement under the terms of the
Engagement Letter as modified by this Order; and
(c) if, before the earlier of (i) the entry of an order confirming a chapter 11 plan in
these cases (that order having become a final order no longer subject to
appeal), and (ii) the entry of an order closing these chapter 11 cases, Epiq
believes that it is entitled to the payment of any amounts by the Debtors on
account of the Companys indemnification, contribution and/or
reimbursement obligations under the Engagement Letter (as modified by this
Order), including without limitation the advancement of defense costs, Epiq
must file an application therefor in this Court, and the Debtors may not pay
any such amounts to Epiq before the entry of an order by this Court approving
the payment. This subparagraph (c) is intended only to specify the period of
time under which the Court shall have jurisdiction over any request for fees
and expenses by Epiq for indemnification, contribution or reimbursement, and
not a provision limiting the duration of the Companys obligation to
indemnify Epiq. All Parties-In-Interest shall retain the right to object to any
demand by Epiq for indemnification, contribution or reimbursement.
14. In the event Epiq is unable to provide the services set out in this Order, Epiq will
immediately notify the Clerk and Debtors counsel and cause to have all original proofs of claim

5
and computer information turned over to another claims and noticing agent with the advice and
consent of the Clerk and the Debtors counsel.
15. Epiq shall not cease providing the Claims and Noticing Services during these
cases for any reason without prior order of the Court authorizing Epiq to do so; provided,
however, that Epiq may seek such an order on expedited notice by filing a request with the Court
with notice of such request to be served on the Debtors, the Office of the United States Trustee,
and any official committee of creditors appointed, if any, in these cases by facsimile or overnight
delivery; provided further, that except as expressly provided herein, the Debtors and Epiq may
otherwise terminate or suspend other services as provided under the Engagement Letter.
16. After entry of an order terminating Epiqs services as the Notice and Claims
Agent, upon the closing of these cases, or for any other reason, Epiq shall be responsible for
archiving all proofs of claim with the Federal Archives Record Administration, if applicable.
17. The Debtors and Epiq are authorized to take all actions necessary to effectuate the
relief granted pursuant to this Order in accordance with the Application and Engagement Letter.
18. Epiq shall not cease providing the Claims and Noticing Services during the cases
for any reason, including nonpayment, without an order of the Court.
19. In the event of any inconsistency between the Engagement Letter, the
Application, and this Order, this Order shall govern.
20. The Court retains exclusive jurisdiction with respect to all matters arising from or
related to the implementation of this Order.
Wilmington, Delaware
Dated: ____________, 2014

UNITED STATES BANKRUPTCY J UDGE


EXHIBIT B
Katchadurian Declaration

)
In re: ) Chapter 11
)
1
)
)
Case No. 14-_______ (___)
)

DECLARATION OF JAMES KATCHADURIAN IN SUPPORT
OF THE APPLICATION OF THE DEBTORS FOR ENTRY OF AN
ORDER APPROVING THE RETENTION AND APPOINTMENT OF EPIQ
BANKRUPTCY SOLUTIONS, LLC AS THE CLAIMS AND NOTICING AGENT
FOR THE DEBTORS, EFFECTIVE NUNC PRO TUNC TO THE PETITION DATE

I, J ames Katchadurian, hereby declare, under penalty of perjury, as follows:
1. I am the Executive Vice President, Director of Restructuring of Epiq Bankruptcy
Solutions, LLC (Epiq), and I am authorized to make and submit this declaration on behalf of
Epiq. This declaration is submitted in support of the Application of Energy Future Holdings
Corp., et al., for Entry of an Order Approving the Employment and Retention of Epiq Bankruptcy
Solutions, LLC as the Claims and Noticing Agent to the Debtors, Effective Nunc Pro Tunc to the
Petition Date (the Application) to which this declaration is attached. The statements contained
herein are based upon personal knowledge.
2. As agent and custodian of the Court records pursuant to 28 U.S.C. 156(c), Epiq
will perform at the request of the Clerk
2
the noticing and claims services specified in the

1
The last four digits of Energy Future Holdings Corp.s tax identification number are 8810. The location of the
2
Capitalized terms used but not otherwise defined herein have the meanings ascribed to them in the Application.

2
Application and the Engagement Letter. In addition, at the Debtors request, Epiq will perform
such other claims and noticing services as specified in the Application. For the avoidance of
doubt, pursuant to the Engagement Letter, Epiq will perform the Claims and Noticing Services
for Energy Future Holdings Corp. and its direct and indirect subsidiaries, other than Oncor
Holdings LLC and its subsidiaries
3. Epiq represents, among other things, the following:
a. Epiq neither holds nor represents any interest adverse to the Debtors
estates in connection with any matters for which Epiq will be employed;
b. I am not related or connected to and, to the best of my knowledge, no
other professional of Epiq is related to or connected to any United States
Bankruptcy J udge for the District of Delaware or the United States
Trustee or to any employee in the offices thereof;
c. Epiq will not consider itself employed by the United States government
and shall not seek any compensation from the United States government
in its capacity as the Claims and Noticing Agent in these
chapter 11 cases;
d. by accepting employment in these chapter 11 cases, Epiq waives any
rights to receive compensation from the United States government;
e. in its capacity as the Claims and Noticing Agent in these
chapter 11 cases, Epiq will not be an agent of the United States and will
not act on behalf of the United States;
f. Epiq will not employ any past or present employees of the Debtors in
connection with its work as the Claims and Noticing Agent in these
chapter 11 cases;
g. in its capacity as the Claims and Noticing Agent in these chapter 11
cases, Epiq will not intentionally misrepresent any fact to any person;
h. Epiq shall be under the supervision and control of the Clerks office with
respect to the receipt and recordation of claims and claim transfers; and
i. none of the services provided by Epiq as the Claims and Noticing Agent
shall be at the expense of the Clerks office.
4. In connection with the preparation of this Declaration, I caused to be submitted
for review by our conflicts system the names of all known potential parties in interest

3
(the Parties-in-Interest) in these cases. The list of Parties-in-Interest was provided by the
Debtors and included the Debtors, the Debtors current and former directors and officers,
significant stockholders, secured creditors, top 30 unsecured creditors, and other parties. The
results of the conflicts check were compiled and reviewed by employees of Epiq, under my
supervision. At this time, Epiq is not aware of any relationship which would present a
disqualifying conflict of interest. Upon Epiqs review of a list of Parties-in-Interest, it appears
that the following entities may be a party in interest or vendor of the Debtors and are entities for
which Epiq is acting as a claims agent in a neutral capacity: Lehman Brothers Holdings,
Lehman Brothers, Inc., and / or Stone and Webster, Inc.
5. Epiq currently serves, or in the past may have served, in a neutral capacity as
claims, noticing, balloting and/or solicitation agent for these parties or related parties. However,
given Epiqs neutral position as claims and noticing agent or administrative advisor in the listed-
parties cases, or any other cases, Epiq does not view such relationships as real or potential
conflicts. Further, to the best of my knowledge, any such relationship, is completely unrelated to
these chapter 11 cases. Further, to the best of my knowledge, any such relationship is
completely unrelated to these chapter 11 cases. Accordingly, to the best of my knowledge, Epiq
and each of its employees are disinterested persons, as that term is defined in section 101(14)
of the Bankruptcy Code, and neither Epiq nor any of its employees hold or represent an interest
adverse to the Debtors estates related to any matter for which Epiq will be employed.
6. To the best of my knowledge, neither Epiq nor any of its personnel have any
relationship with the Debtors that would impair Epiqs ability to serve as Claims and Noticing
Agent. Epiq may have relationships with certain of the Debtors creditors as vendors or in
connection with cases in which Epiq serves or has served in a neutral capacity as claims and

4
noticing agent for another chapter 11 debtor. To the best of my knowledge, such relationships
are completely unrelated to these chapter 11 cases. Epiqs personnel may have relationships
with some of the Debtors creditors or other parties in interest. To the best of my knowledge,
however, such relationships, to the extent they exist, are of a personal financial nature and
completely unrelated to these chapter 11 cases. Epiq has, and will continue to represent clients
in matters unrelated to these chapter 11 cases. In addition, Epiq has had, and will continue to
have, relationships in the ordinary course of its business with certain vendors, professionals,
and other parties in interest that may be involved in the Debtors cases in matters unrelated to
these cases.
7. Epiq shares a corporate parent with certain companies that provide integrated
technology products and services to the legal profession for electronic discovery, class action
settlements, financial transactions, chapter 7 and 13 bankruptcy, litigation, and regulatory
compliance. Given the legal and operational separateness of Epiq from its affiliates and the
administrative nature of the services performed by such companies, Epiq does not believe that
a conflict would arise solely from any relationship or claim of an Epiq affiliate or its corporate
parent.
8. If any new facts or relationships are discovered, Epiq will supplement its
disclosure to the Court.
9. In performing the services of the Claims and Noticing Agent, Epiq will charge
the Debtors the rates set forth in the Engagement Letter.
10. Prior to the Petition Date, the Debtors provided Epiq a retainer in the amount of
$100,000. Epiq seeks to hold the retainer under the Engagement Letter during the cases as
security for the payment of fees and expenses incurred under the Engagement Letter.

5
11. Epiq will comply with all requests of the Clerks office, including the Claims
Agent Protocol and the guidelines promulgated by the J udicial Conference of the United States
for the implementation of 28 U.S.C. 156(c).
12. The services provided by Epiq will be administrative in nature, and Epiq will not
provide services in the nature of legal representation and/or advice to the Debtors.
Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the foregoing is
true and correct to the best of my knowledge, information and belief.
Executed on April 21, 2014
/s/ J ames Katchadurian
J ames Katchadurian
Executive Vice President
Epiq Bankruptcy Solutions, LLC


EXHIBIT C

Engagement Letter

Execution Version
Confidential

AMENDMENT TO ENGAGEMENT LETTER

THIS AMENDMENT TO ENGAGEMENT LETTER is made as of January 7,
2014, by and among Epiq Bankruptcy Solutions, LLC (Epiq), on the one hand, and
Energy Future Holdings Corp. (EFH), Energy Future Intermediate Holding Company
LLC (EFIH), Energy Future Competitive Holdings Company LLC (EFCH), and
Texas Competitive Electric Holdings Company LLC (TCEH) (collectively, the
Company Parties), on the other hand and amends that certain engagement letter entered
into by and between EFCH and TCEH, on the one hand, and Epiq, on the other hand,
dated as of March 20, 2013 (the Engagement Letter). Capitalized terms used but not
otherwise defined herein have the meanings ascribed to such terms in the Engagement
Letter.

WHEREAS, Epiq and the Company Parties desire to amend the Engagement
Letter as set forth in this letter agreement.

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

1. Amendment to the Engagement Letter. Paragraph 1 of the Engagement Letter is
hereby amended to include the following addition:

Pursuant to the terms herein, Epiq will provide services to Energy Future
Holdings Corp. and its direct and indirect subsidiaries, other than Oncor Holdings
LLC and its subsidiaries (collectively, Oncor).

2. Ratification. Except as specifically provided for in this letter agreement, no
changes, amendments, or other modifications have been made on or prior to the date
hereof or are being made to the terms of the Engagement Letter or the rights and
obligations of the parties thereunder, all of which are hereby ratified and confirmed and
remain in full force and effect.

3. Effect of Amendment. This letter agreement shall be effective as of January 7,
2014. Following the effective date, whenever the Engagement Letter is referred to in any
agreements, documents, correspondence, and instruments, such reference shall be
deemed to be in the Engagement Letter as amended by this letter agreement.

[Signature pages follow.]



)
In re: ) Chapter 11
)
1
) Case No. 14-_______ (___)
)
Debtors. ) (Joint Administration Requested)
)

SUPPLEMENTAL DECLARATION OF PAUL KEGLEVIC, EXECUTIVE VICE
PRESIDENT, CHIEF FINANCIAL OFFICER, AND CO-CHIEF RESTRUCTURING
OFFICER OF ENERGY FUTURE HOLDINGS CORP., ET AL., IN SUPPORT OF
WAGES AND BENEFITS MOTION

1

Pursuant to 28 U.S.C. 1746, I, Paul Keglevic, hereby declare as follows under penalty
of perjury:
1. I am the Executive Vice President, Chief Financial Officer, and Co-Chief
Restructuring Officer of Energy Future Holdings Corp. (EFH Corp.) a corporation organized
under the laws of the state of Texas; its direct subsidiary, Energy Future Competitive Holdings
Company LLC (EFCH), a limited liability company organized under the laws of the state of
Delaware; EFCHs direct subsidiary, Texas Competitive Electric Holdings Company LLC
(TCEH LLC and, together with EFCH and TCEH LLCs direct and indirect subsidiaries,
TCEH, and the entities composing TCEH that are debtors in these chapter 11 cases, the
TCEH Debtors), a limited liability company organized under the laws of the state of Delaware;
and EFH Corp.s direct subsidiary, Energy Future Intermediate Holding Company LLC
(EFIH), a limited liability company organized under the laws of the state of Delaware. EFH
Corp., various other direct and indirect subsidiaries of EFH Corp. that are debtors in these
chapter 11 cases, the TCEH Debtors, and EFIH are collectively referred to as the Debtors in
this declaration.
2. I have worked for the Debtors since 2008. I am generally familiar with the
Debtors businesses, day-to-day operations, financial matters, results of operations, cash flows,
and underlying books and records. All facts set forth in this declaration are based upon my
personal knowledge of the Debtors businesses, operations, and related financial information
gathered from my review of their books and records, relevant documents, and information
supplied to me by members of the Debtors management team and advisors. I am over the age of
18 and duly authorized to execute this Declaration on behalf of the Debtors in support of the
Motion of Energy Future Holdings Corp., et al. , for Entry of Interim and

2

Final Orders (a) Authorizing the Debtors to (i) Pay Certain Prepetition Compensation and
Reimbursable Employee Expenses, (ii) Pay and Honor Employee and Retiree Medical and
Similar Benefits, and (iii) Continue Employee and Retiree Benefit Programs, and (b) Modifying
the Automatic Stay (the Wages and Benefits Motion).
3. This Declaration addresses the non-Insider status of employees who are eligible to
participate (Eligible Employees) in TXU Energys Sales Incentive Plan and Luminants Retail
Gas Sales Incentive Plan (the Plans).
A. TXU Energy Sales Incentive Plan
4. The Debtors have historically offered a sales incentive plan to approximately 200,
non-insider, full-time Employees at TXU Energy based on their performance in sales
management, direct sales, or sales support positions in TXU Energys retail business. The
Debtors seek to continue making payments under this plan in the ordinary course in the Wages
and Benefits motion. Under the plan, specified senior management set certain performance goals
for eligible Employees based on the detailed business plan approved by the TXU Energy
executive leadership team. TXU Energy undertakes a rigorous review process for payments
under the program, including review by the vice presidents of the relevant business units and
approval by a dedicated award committee. As of the Petition Date, approximately $900,000 is
due and outstanding on account of the TXU Energy Sales Incentive Plan, approximately
$800,000 of which will become due and payable during the Interim Period (approximately
$4,000 per eligible Employee).
5. This program encourages employee performance and drives sales revenue at TXU
Energy by providing supplemental compensation tied directly to performance and sales metrics.
While individuals in the Sales Incentive Plan do not generally receive large, individual cash
awards, the participants depend on this supplemental income, which is a significant percentage

3

of their total compensation. As shown in the attached spreadsheet, the potential bonuses account
for, on average, 31% of eligible employees total compensation; for some, bonus payments can
range up to 75% of total compensation. Eligible employees are thus highly incentivized to work
to achieve the various performance metrics on which the awards are based.
6. The employees eligible to participate in the TXU Sales Incentive Plan interact
with TXU Energys diverse customer base and know a significant amount about the Debtors and
the Debtors industry. Replacing these employees would be highly disruptive to the business and
directly affect the Debtors relationship with their customers. In addition, TXU Energys sales
force is highly marketable in the competitive Texas retail electric market. Uncertainty related to
the Sales Incentive Plan would undoubtedly result in increased attrition and directly impact TXU
Energys business.
B. Luminant Retail Gas Sales Incentive Plan
7. In addition, the Debtors have historically offered a sales incentive plan to
approximately four non-Insider, full-time gas sales employees at Luminant based on financial
EBIT targets for each year. Eligible employees sell gas to large commercial and industrial
customers on behalf of Luminant.
8. The Debtors seek to continue making payments under this plan in the ordinary
course in the Wages and Benefits motion. Under the plan, Luminant undertakes a rigorous
approval process similar to the process described above with respect to the TXU Sales Incentive
Plan before making bonus payments. As of the Petition Date, approximately $50,000 is due and
outstanding on account of the Luminant Retail Gas Sales Incentive Plan, all of which will
become due and payable during the Interim Period.
9. Like the Sales Incentive Plan at TXU Energy, this program encourages employee
performance and drives EBIT at Luminant by providing supplemental compensation tied directly

4

to performance and sales metrics. While individuals in the Sales Incentive Plan do not generally
receive large, individual cash awards, the participants depend on this supplemental income,
which is a significant percentage of their total compensationranging from 9 to 35% of total
compensation for these four individuals. Participants in the plan thus work hard to achieve the
various performance metrics on which the awards are based.
10. Like the TXU Energy plan, the employees eligible to participate in the Luminant
Retail Gas Sales Incentive Plan know a significant amount about the Debtors and the Debtors
industry. Replacing these employees would be highly disruptive to the business and directly
affect the Debtors relationship with their customers.
C. None of the Eligible Employees Are Insiders.
11. None of the participants in the TXU Energy Sales Incentive Plan or Luminant
Retail Gas Sales Incentive Plan are directors or officers of any of the debtors or persons in
control of the debtors. As reflected in the attached chartswhich include the titles and business
unit channel of eligible employeesthese programs include only rank-and-file employees.
The TXU Energy Sales Incentive Plan includes members of the sales teami.e., account
managers, sales persons for large commercial and industrial customers, door-to-door sales
people, telemarketers, and other employees in the TXU Energy sales department. The Luminant
Retail Gas Sales Incentive Plan includes similar rank-and-file sales staff at that business unit.
Indeed, the employees who are eligible to participate in the TXU Energy Sales Incentive Plan
and Luminant Retail Gas Sales Incentive Plan are all at least three levels removed from reporting
to a single member of the Debtors executive management team, and in many cases, are up to six
levels removed from the executive management team.
12. The Eligible Employees Are Not Directors. I understand that the term
director generally means an individual who sits on the board of directors of a corporation.

5

None of the employees who are eligible for the Sales Incentive Plans at TXU Energy or
Luminant sit on the Debtors boards of directors, partake in Board meetings, implement
corporate policy, or engage in corporate governance.
13. The Eligible Employees Are Not Officers. I understand that the term officer
generally means a person elected or appointed by the board of directors to manage the daily
operations of a company. None of the eligible employees have been elected or appointed by any
of the Debtors boards, and none manage the daily operations of any of the Debtors either.
14. The Eligible Employees Are Not Persons In Control of the Debtors. Nor are
the eligible employees persons in control of the Debtors. None have sufficient authority to
dictate corporate policy or dispose of corporate assets. None oversee the Debtors strategic plan
or determine the disposition of corporate funds with respect to strategic investing or financing
activities. Nor do the eligible employees report to the Board or the Debtors executive
management team. And they are not granted decision-making authority akin to an executive
either.
D. Conclusion
15. I believe that there would be a detrimental impact to the value of the Debtors
businesses if these Sales Incentive Plans did not exist. It would adversely affect the Debtors
day-to-day, rank-and-file sales force and unnecessarily compromise sales operations during a
critical time for the Debtors. I accordingly believe that paying prepetition amounts owed under
these plans and continuing the plans on a postpetition basis is in the best interests of the Debtors
and all parties in interest.

[Remainder of the page left intentionally blank.]
Page 1 of 5
TXU Energy Sales Incentive Plan: Eligible Employees
Department and Titles of Eligible Employees
Dept Name Title
LCI Sr Director of LCI Sales
LCI Dir-Product Mgmt (Interim
LCI Dir, Key Nat'l Accts
LCI Dir North Texas
LCI Dir South Texas
LCI Manager III, Sales
LCI Sales Exec IV
LCI Sales Exec IV
LCI Sales Exec IV
LCI Sales Exec IV
LCI Sr Sales Exec-Major Accts
LCI Sales Exec IV
LCI Sales Exec IV
LCI Sales Exec IV
LCI Sales Exec III
LCI Sales Exec IV
LCI Sales Exec II
LCI Sales Exec IV
LCI Sales Exec IV
LCI Sales Exec II
LCI Sales Exec III
LCI Sales Exec III
LCI Sales Exec IV
LCI Sales Exec III
LCI Sales Exec III
LCI Sales Exec II - Lg Commer
LCI Sales Exec III
LCI Sales Exec III
LCI Sales Coordinator II
LCI Channel Account Mgr
AM Account Manager III
AM Account Manager II
AM Sales Coordinator III
AM Account Manager I
AM Sales Coord I
AM Manager I, Sales
AM Manager I, Sales
* Some employees are eligible for additional incentive-based compensation under the Annual Incentive Plan, which program will
be addressed in a separate motion.
Page 2 of 5
Dept Name Title
AM Manager II,Sales
AM Manager III, Sales
Structured Transaction Dir Product Dev & Structu
Structured Transaction Analyst III
Structured Transaction Analyst III
Structured Transaction Specialist I
Business Solutions Manager II, Sales
Business Solutions Supervisor I
Business Solutions Supvervisor I, Cust Ops
Business Solutions Manager I, Sales
Business Solutions Sr Dir Bus Mass Mkts
Business Solutions Sales Specialist Lead
Business Solutions Bus Markets Sales Spec I
Business Solutions Bus Sales Spec
Business Solutions Business Sales Associate
Business Solutions Sales Specialist Associat
Business Solutions Bus Sol Sales Spec II
Business Solutions Bus Solutions Sales Spec
Business Solutions Business Sales Associate,
Business Solutions Bus Mkts Sales Assoc
Business Solutions Bus Sales Assoc
Page 3 of 5
Dept Name Title
Business Solutions Bus Sales Assoc
Builder/Multi-Family Sales Exec III
Builder/Multi-Family Sales Exec II
Builder/Multi-Family Sales Exec I
Builder/Multi-Family Sales Exec III
Builder/Multi-Family Sales Exec I
Builder/Multi-Family D2D Bus Sales Specialist
Builder/Multi-Family Bus Markets Sales Spec I
Builder/Multi-Family Bus Markets Sales Spec I
Builder/Multi-Family Manager I, Sales
Builder/Multi-Family Manager III
Res D2D Support Manager III
Res D2D Support Manager III,Sales
Res D2D Support Supervisor III
Res D2D Support Analyst II, Vendor Mgmt.
Res D2D Support Analyst II, Vendor Mgmt.
Res D2D Support Director, Direct Sales
Res D2D Sales D2D Res Sales Rep 1
Res D2D Sales Integration: default posi
Res D2D Sales D2D Res Sales Supv I
Res D2D Sales Assoc Admin Coord
Res D2D Sales Supv I, D2D Res Sales
Res D2D Sales Integration: default posi
Res D2D Sales D2D Res Sales Rep II
Res D2D Sales Supv I, D2D Res Sales
Res D2D Sales Assoc Admin Coord
Res D2D Sales D2D Res Sales Rep I
Res D2D Sales D2D Res Sales Rep II
Res D2D Sales D2D Res Sales Rep III
Telesales Sales Specialist II
Telesales Sales Specialist Associat
Page 4 of 5
Dept Name Title
Telesales Sales Exec II
Telesales Business Sales Assoc. Tel
Telesales Sales Specialist Associat
Telesales Supervisor II, Cust Ops
Telesales Supervisor II, Businesss
Telemarketing Director Telemarket Chann
Telemarketing Supervisor III
Telemarketing Account Mgr II-Telemarket
Telemarketing Manager I, Sales
Telemarketing Manager I, Sales
Telemarketing Supervisor II
Telemarketing Supervisor I
Telemarketing Business Sales Associate
Telemarketing Sales Specialist Associat
COF Director Residential Sale
COF Analyst III, Sales OBTM
COF Manager II, Sales Acquisi
COF Specialist I
COF Partner Relationship Mgr
COF Supervisor II, Cust Ops
4Change Indirect Sales Executive
Page 1 of 1
Aggregate SIP Target 4,880,633 $
Aggregate Total Compensation for Eligible Employees 15,972,072 $
Average SIP Target 25,823 $
Average Total Comp for Eligible Employees 84,508 $
Average SIP as a % of Total Comp 30.6%
Range of Average SIP Target as a % of Total Comp 4 to 76%
* Some employees are eligible for additional incentive-based compensation under the Annual Incentive Plan, which program
will be addressed in a separate motion.
Luminant Retail Gas Sales Incentive Plan:
Titles & Departments of Eligible Employees
Dept Name Title
Texas Gas Mgr Texas Gas
Retail_Gas_Sales Sales Executive Sr
Retail_Gas_Sales Mgr Texas Gas Sales
Retail_Gas_Sales Sales Executive Sr
Page 1 of 2
Luminant Retail Gas Sales Incentive Plan: Compensation
Aggregate SIP Target 162,000 $
Aggregate Total Compensation for Eligible Employees 654,562 $
Average SIP Target 40,500 $
Average Total Comp for Eligible Employees 163,641 $
Average SIP as a % of Total Comp 24.7%
Range of Average SIP Target as a % of Total Comp 9 to 35%
Page 1 of 1

#4821-7663-6950

SENIOR SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION CREDIT AGREEMENT
Dated as of [______], 2014
among
ENERGY FUTURE COMPETITIVE HOLDINGS COMPANY LLC,
as Parent Guarantor,
TEXAS COMPETITIVE ELECTRIC HOLDINGS COMPANY LLC,
as the Borrower,
The Several Lenders
from Time to Time Parties Hereto,
CITIBANK, N.A.,
as Administrative Agent and Collateral Agent,
DEUTSCHE BANK AG NEW YORK BRANCH,
BANK OF AMERICA, N.A. AND
MORGAN STANLEY SENIOR FUNDING, INC.,
as Co-Syndication Agents,
BARCLAYS BANK PLC,
ROYAL BANK OF CANADA AND
UNION BANK, N.A.,
as Co-Documentation Agents,
and
CITIGROUP GLOBAL MARKETS INC.,
DEUTSCHE BANK SECURITIES INC.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
MORGAN STANLEY SENIOR FUNDING, INC.,
BARCLAYS BANK PLC,
RBC CAPITAL MARKETS
1
AND
UNION BANK, N.A.
as J oint Lead Arrangers and J oint Bookrunners

1
RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its affiliates.

-i-
#4821-7663-6950
TABLE OF CONTENTS
Page

SECTION 1. Definitions. ............................................................................................................. 2
1.1. Defined Terms ........................................................................................................ 2
1.2. Other Interpretive Provisions ............................................................................... 60
1.3. Accounting Terms ................................................................................................ 61
1.4. Rounding .............................................................................................................. 61
1.5. References to Agreements, Laws, Etc. ................................................................. 61
1.6. Times of Day ........................................................................................................ 61
1.7. Timing of Payment of Performance ..................................................................... 61
1.8. Currency Equivalents Generally .......................................................................... 61
1.9. Classification of Loans and Borrowings .............................................................. 62
1.10. Hedging Agreements ............................................................................................ 62
SECTION 2. Amount and Terms of Credit ................................................................................ 62
2.1. Commitments ....................................................................................................... 62
2.2. Minimum Amount of Each Borrowing; Maximum Number of
Borrowings ........................................................................................................... 64
2.3. Notice of Borrowing; Determination of Class of Loans....................................... 64
2.4. Disbursement of Funds ......................................................................................... 65
2.5. Repayment of Loans; Evidence of Debt ............................................................... 66
2.6. Conversions and Continuations ............................................................................ 66
2.7. Pro RataBorrowings ............................................................................................ 67
2.8. Interest .................................................................................................................. 67
2.9. Interest Periods ..................................................................................................... 68
2.10. Increased Costs, Illegality, Etc. ............................................................................ 69
2.11. Compensation ....................................................................................................... 70
2.12. Change of Lending Office .................................................................................... 71
2.13. Notice of Certain Costs ........................................................................................ 71
2.14. Incremental Facilities ........................................................................................... 71
2.15. [Reserved] ............................................................................................................ 73
2.16. Defaulting Lenders ............................................................................................... 73
SECTION 3. Letters of Credit ................................................................................................... 74
3.1. Issuance of Letters of Credit ................................................................................ 74
3.2. Letter of Credit Requests ...................................................................................... 75
3.3. [Reserved]. ........................................................................................................... 76
3.4. Agreement to Repay Letter of Credit Drawings ................................................... 76
3.5. Increased Costs ..................................................................................................... 77
3.6. New or Successor Letter of Credit Issuer ............................................................. 77
3.7. Role of Letter of Credit Issuer .............................................................................. 78
3.8. General L/C Collateral Account ........................................................................... 79
3.9. RCT L/C Collateral Account ................................................................................ 80
Page

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#4821-7663-6950
3.10. Drawings from General L/C Collateral Accounts and RCT L/C
Collateral Account ................................................................................................ 81
3.11. Applicability of ISP and UCP .............................................................................. 81
3.12. Conflict with Issuer Documents ........................................................................... 81
3.13. Letters of Credit Issued for Others ....................................................................... 82
SECTION 4. Fees; Commitments .............................................................................................. 82
4.1. Fees....................................................................................................................... 82
4.2. Voluntary Reduction of Revolving Credit Commitments and
Delayed-Draw Term Loan Commitments ............................................................ 83
4.3. Mandatory Termination of Commitments ............................................................ 84
4.4. RCT Carve Out Support Rejection Notice. .......................................................... 84
SECTION 5. Payments .............................................................................................................. 84
5.1. Voluntary Prepayments ........................................................................................ 84
5.2. Mandatory Prepayments ....................................................................................... 85
5.3. Method and Place of Payment .............................................................................. 86
5.4. Net Payments ........................................................................................................ 87
5.5. Computations of Interest and Fees ....................................................................... 90
5.6. Limit on Rate of Interest ...................................................................................... 90
SECTION 6. Conditions Precedent to Initial Borrowing ........................................................... 91
6.1. Credit Documents ................................................................................................. 91
6.2. Collateral .............................................................................................................. 91
6.3. Legal Opinions ..................................................................................................... 91
6.4. Initial Budget ........................................................................................................ 92
6.5. [Reserved]. ........................................................................................................... 92
6.6. Closing Certificates .............................................................................................. 92
6.7. Authorization of Proceedings of Each Credit Party ............................................. 92
6.8. Fees....................................................................................................................... 92
6.9. Representations and Warranties ........................................................................... 92
6.10. Interim Order ........................................................................................................ 92
6.11. First Day Orders ................................................................................................... 92
6.12. Trustees and Examiners ........................................................................................ 93
6.13. Projections ............................................................................................................ 93
6.14. Patriot Act ............................................................................................................ 93
6.15. Petition Date ......................................................................................................... 93
6.16. Restructuring Support Agreement ........................................................................ 93
6.17. Restructuring Documents ..................................................................................... 93
SECTION 7. Conditions Precedent to All Credit Events ........................................................... 93
7.1. No Default; Representations and Warranties ....................................................... 94
7.2. Notice of Borrowing ............................................................................................. 94
7.3. Full Availability ................................................................................................... 94
Page

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#4821-7663-6950
7.4. Availability of Delayed-Draw Term Loans and RCT Letters of
Credit .................................................................................................................... 95
SECTION 8. Representations, Warranties and Agreements ...................................................... 95
8.1. Corporate Status; Compliance with Laws ............................................................ 95
8.2. Corporate Power and Authority ........................................................................... 96
8.3. No Violation ......................................................................................................... 96
8.4. Litigation .............................................................................................................. 96
8.5. Margin Regulations .............................................................................................. 96
8.6. Governmental Approvals ..................................................................................... 96
8.7. Investment Company Act ..................................................................................... 97
8.8. True and Complete Disclosure ............................................................................. 97
8.9. Financial Condition; Projections; Material Adverse Effect ................................. 97
8.10. Tax Matters .......................................................................................................... 97
8.11. Compliance with ERISA ...................................................................................... 98
8.12. Subsidiaries .......................................................................................................... 98
8.13. Intellectual Property ............................................................................................. 98
8.14. Environmental Laws............................................................................................. 99
8.15. Properties .............................................................................................................. 99
8.16. Orders ................................................................................................................... 99
8.17. Status of Obligations; Perfection and Priority of Security
Interests ................................................................................................................ 99
8.18. Insurance ............................................................................................................ 100
8.19. Labor Matters ..................................................................................................... 100
8.20. Sanctioned Persons; Anti-Corruption Laws; Patriot Act .................................... 100
SECTION 9. Affirmative Covenants ....................................................................................... 100
9.1. Information Covenants ....................................................................................... 101
9.2. Books, Records and Inspections ......................................................................... 104
9.3. Maintenance of Insurance .................................................................................. 105
9.4. Payment of Taxes ............................................................................................... 105
9.5. Consolidated Corporate Franchises .................................................................... 106
9.6. Compliance with Statutes, Regulations, Etc. ...................................................... 106
9.7. ERISA ................................................................................................................ 106
9.8. Maintenance of Properties .................................................................................. 107
9.9. Transactions with Affiliates ............................................................................... 107
9.10. End of Fiscal Years; Fiscal Quarters .................................................................. 108
9.11. Additional Guarantors and Grantors .................................................................. 108
9.12. Pledge of Additional Stock and Evidence of Indebtedness ................................ 109
9.13. [Reserved] .......................................................................................................... 109
9.14. Further Assurances ............................................................................................. 109
9.15. Bankruptcy Matters ............................................................................................ 110
9.16. Ratings ................................................................................................................ 110
9.17. Use of Proceeds .................................................................................................. 110
SECTION 10. Negative Covenants ............................................................................................ 111
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10.1. Limitation on Indebtedness ................................................................................ 111
10.2. Limitation on Liens ............................................................................................ 115
10.3. Limitation on Fundamental Changes ................................................................. 119
10.4. Limitation on Sale of Assets .............................................................................. 120
10.5. Limitation on Investments .................................................................................. 123
10.6. Limitation on Dividends ..................................................................................... 127
10.7. Limitation on Prepaying Indebtedness ............................................................... 131
10.8. Limitations on Sale Leasebacks ......................................................................... 131
10.9. Consolidated Superpriority Secured Net Debt to Consolidated
EBITDA Ratio .................................................................................................... 131
10.10. Changes in Business ........................................................................................... 131
10.11. Bankruptcy Provisions. ...................................................................................... 131
10.12. Affiliate Value Transfers .................................................................................... 132
SECTION 11. Events of Default ................................................................................................ 132
11.1. Payments ............................................................................................................ 132
11.2. Representations, Etc. .......................................................................................... 132
11.3. Covenants ........................................................................................................... 132
11.4. Default Under Other Agreements ....................................................................... 132
11.5. [Reserved] .......................................................................................................... 133
11.6. ERISA ................................................................................................................ 133
11.7. Credit Documents ............................................................................................... 133
11.8. [Reserved] .......................................................................................................... 133
11.9. [Reserved] .......................................................................................................... 133
11.10. [Reserved] .......................................................................................................... 133
11.11. J udgments ........................................................................................................... 133
11.12. Hedging Agreements .......................................................................................... 133
11.13. Change of Control .............................................................................................. 134
11.14. Final Order ......................................................................................................... 134
11.15. Matters Related to the Cases .............................................................................. 134
11.16. Automatic Stay ................................................................................................... 135
11.17. Status of Orders .................................................................................................. 135
11.18. Confirmation of Plan .......................................................................................... 135
11.19. Application of Proceeds ..................................................................................... 135
SECTION 12. The Agents ......................................................................................................... 138
12.1. Appointment ....................................................................................................... 138
12.2. Delegation of Duties ........................................................................................... 138
12.3. Exculpatory Provisions....................................................................................... 138
12.4. Reliance by Agents ............................................................................................. 140
12.5. Notice of Default ................................................................................................ 140
12.6. Non-Reliance on Administrative Agent, Collateral Agent and
Other Lenders ..................................................................................................... 140
12.7. Indemnification .................................................................................................. 141
12.8. Agents in its Individual Capacities ..................................................................... 142
12.9. Successor Agents ................................................................................................ 142
12.10. Withholding Tax ................................................................................................ 143
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12.11. Trust Indenture Act ............................................................................................ 143
12.12. [Reserved]. ......................................................................................................... 143
12.13. Security Documents and Guarantee ................................................................... 143
SECTION 13. Miscellaneous ..................................................................................................... 144
13.1. Amendments, Waivers and Releases .................................................................. 144
13.2. Notices ................................................................................................................ 148
13.3. No Waiver; Cumulative Remedies ..................................................................... 148
13.4. Survival of Representations and Warranties ...................................................... 148
13.5. Payment of Expenses; Indemnification .............................................................. 148
13.6. Successors and Assigns; Participations and Assignments .................................. 150
13.7. Replacements of Lenders under Certain Circumstances .................................... 154
13.8. Adjustments; Set-off .......................................................................................... 155
13.9. Counterparts ....................................................................................................... 155
13.10. Severability ......................................................................................................... 155
13.11. INTEGRATION ................................................................................................. 155
13.12. GOVERNING LAW .......................................................................................... 156
13.13. Submission to J urisdiction; Waivers .................................................................. 156
13.14. Acknowledgments .............................................................................................. 156
13.15. WAIVERS OF J URY TRIAL ............................................................................ 157
13.16. Confidentiality .................................................................................................... 157
13.17. Direct Website Communications ........................................................................ 158
13.18. USA PATRIOT Act ........................................................................................... 160
13.19. Payments Set Aside ............................................................................................ 160
13.20. Separateness ....................................................................................................... 160
13.21. Keepwell ............................................................................................................. 160
SECTION 14. Security; Secured Commodity Hedging Agreements ......................................... 161
14.1. Security ............................................................................................................... 161
14.2. Secured Commodity Hedging Agreements ........................................................ 163
14.3. Permitted Property Interests ............................................................................... 164


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SCHEDULES
Schedule 1.1(a) Commitments
Schedule 1.1(b) Excluded Subsidiaries
Schedule 1.1(c) Unrestricted Subsidiaries
Schedule 1.1(d) First Day Motions
Schedule 8.4 Litigation
Schedule 8.12 Subsidiaries
Schedule 8.15 Property
Schedule 9.9 Closing Date Affiliate Transactions
Schedule 10.1 Closing Date Indebtedness
Schedule 10.2 Closing Date Liens
Schedule 10.4 Scheduled Dispositions
Schedule 10.5 Closing Date Investments
Schedule 13.2 Notice Addresses

EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Guarantee
Exhibit C Form of Budget Notice
Exhibit D [Reserved]
Exhibit E [Reserved]
Exhibit F Form of Security Agreement
Exhibit G Form of Letter of Credit Request
Exhibit H Form of Credit Party Closing Certificate
Exhibit I Form of Assignment and Acceptance
Exhibit J -1 Form of Promissory Note (Revolving Credit Loans)
Exhibit J -2 Form of Promissory Note (Term Loans)
Exhibit J -3 Form of Promissory Note (Delayed-Draw Term Loans)
Exhibit K Form of Incremental Amendment
Exhibit L Form of Non-U.S. Lender Certification
Exhibit M Initial Budget
Exhibit N Form of Interim Order

#4821-7663-6950

SENIOR SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION CREDIT
AGREEMENT, dated as of [_____], 2014, among ENERGY FUTURE COMPETITIVE HOLDINGS
COMPANY LLC, a Delaware limited liability company and a debtor and debtor-in-possession (Parent
Guarantor), TEXAS COMPETITIVE ELECTRIC HOLDINGS COMPANY LLC, a Delaware limited
liability company and a debtor and debtor-in-possession (TCEH or theBorrower) in a case pending
under chapter 11 of the Bankruptcy Code (Chapter 11), the lending institutions from time to time
parties hereto (each, a Lender and, collectively, the Lenders), CITIBANK, N.A., as Administrative
Agent and Collateral Agent and CITIGROUP GLOBAL MARKETS INC., DEUTSCHE BANK
SECURITIES INC., MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, MORGAN
STANLEY SENIOR FUNDING, INC., BARCLAYS BANK PLC, RBC CAPITAL MARKETS and
UNION BANK, N.A., as J oint Lead Arrangers and J oint Bookrunners.
RECITALS:
WHEREAS, capitalized terms used and not defined in the preamble and these recitals
shall have the respective meanings set forth for such terms in Section 1.1 hereof;
WHEREAS, on [____], 2014 (the Petition Date), the Borrower, Parent Guarantor and
each of the other Guarantors (collectively, the TCEH Debtors) filed voluntary petitions for relief under
Chapter 11 in the United States Bankruptcy Court for the District of Delaware (such court, together with
any other court having exclusive jurisdiction over any Case from time to time and any Federal appellate
court thereof, the Bankruptcy Court) and commenced cases numbered [______] respectively (each, a
Case and, collectively, the Cases), and have continued in the possession and operation of their assets
and in the management of their businesses pursuant to sections 1107 and 1108 of the Bankruptcy Code;
WHEREAS, in connection with the foregoing, the Borrower has requested that the
Lenders and Letter of Credit Issuers extend credit to the Borrower in the form of (a) $1,425,000,000 in
aggregate principal amount of Term Loans, (b) $1,950,000,000 in aggregate principal amount of
Revolving Credit Commitments to be made available to the Borrower at any time and from time to time
prior to the Revolving Credit Termination Date, (c) up to $1,100,000,000 in aggregate principal amount
of Delayed-Draw Term Loan Commitments to be made available to the Borrower at any time and from
time to time prior to the Delayed-Draw Termination Date, (d) $1,100,000,000 in RCT Letter of Credit
Commitments for the issuance of RCT Letters of Credit to be made available to the Borrower from time
to time prior to the RCT L/C Termination Date and (e) $800,000,000 in General Letter of Credit
Commitments for the issuance of General Letters of Credit to be made available to the Borrower from
time to time prior to the General L/C Termination Date, in each case subject to the terms and conditions
set forth herein; and
WHEREAS, the Lenders and Letter of Credit Issuers are willing to make available to the
Borrower such loans and facilities upon the terms and subject to the conditions set forth herein;
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and the covenants and agreements
contained herein, the parties hereto hereby agree as follows:

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SECTION 1. Definitions.
1.1. Defined Terms.
(a) As used herein, the following terms shall have the meanings specified in this
Section 1.1 unless the context otherwise requires:
ABR shall mean for any day a fluctuating rate per annum equal to the greatest of
(a) the Federal Funds Effective Rate plus 1/2 of 1%, (b) the rate of interest in effect for such day as
publicly announced from time to time by the Administrative Agent as its prime rate and (c) the LIBOR
Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately
preceding Business Day) plus 1.00%; provided that, for the avoidance of doubt, for purposes of
calculating the LIBOR Rate pursuant to clause (c), the LIBOR Rate for any day shall be based on the rate
per annum determined by the Administrative Agent at approximately 11:00 a.m. (London time) on such
day by reference to the ICE Benchmark Administration (or any successor organization) LIBOR Rate (the
Relevant LIBOR Rate) for deposits in Dollars (as published by Reuters or any other commonly
available source providing quotations of the Relevant LIBOR Rate as designated by the Administrative
Agent) for a period equal to one month. The prime rate is a rate set by the Administrative Agent based
upon various factors including the Administrative Agents costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some loans, which may be priced
at, above, or below such announced rate. If the Administrative Agent is unable to ascertain the Federal
Funds Effective Rate due to its inability to obtain sufficient quotations in accordance with the definition
thereof, after notice is provided to the Borrower, the ABR shall be determined without regard to clause (a)
above until the circumstances giving rise to such inability no longer exist. Any change in the ABR due to
a change in such rate announced by the Administrative Agent or in the Federal Funds Effective Rate shall
take effect at the opening of business on the day specified in the public announcement of such change or
on the effective date of such change in the Federal Funds Effective Rate or the Relevant LIBOR Rate, as
applicable.
ABR Loan shall mean each Loan bearing interest based on the ABR.
Acceptable Reinvestment Commitment shall mean a binding commitment of the
Borrower or any Restricted Subsidiary entered into at any time prior to the end of the Reinvestment
Period to reinvest the proceeds of a Prepayment Event.
Acceptable Reorganization Plan shall mean a Reorganization Plan that is in form and
substance consistent in all material respects with, and as it may be amended in accordance with the terms
of, the Restructuring Support Agreement and the Restructuring Term Sheet, and is in form and substance
reasonably satisfactory to the Administrative Agent (provided, however, that with respect to provisions of
the plan that relate to the payment of the Credit Facilities, such provisions must be in form and substance
satisfactory to the Administrative Agent) and provides for, among other things, the termination of the
Revolving Credit Commitments and the payment in full in cash of the Obligations outstanding under the
Credit Documents (other than Contingent Obligations) and, with respect to any Letter of Credit that does
not become a letter of credit under the Exit Facilities, cash collateralization of such Letter of Credit, in
each case, on or prior to the earlier of the Plan Effective Date or substantial consummation of such
Reorganization Plan.
Accession Agreement shall mean an accession agreement substantially in the form
attached to the Security Agreement as Exhibit B thereto.

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#4821-7663-6950
Acquired EBITDA shall mean, with respect to any Acquired Entity or Business or any
Converted Restricted Subsidiary (any of the foregoing, a Pro Forma Entity) for any period, the
amount for such period of Consolidated EBITDA of such Pro Forma Entity (determined using such
definitions as if references to the Borrower and the Restricted Subsidiaries therein were to such Pro
Forma Entity and its Restricted Subsidiaries), all as determined on a consolidated basis for such Pro
Forma Entity in a manner not inconsistent with GAAP.
Acquired Entity or Business shall have the meaning provided in the definition of the
term Consolidated EBITDA.
Additional Lender shall mean, at any time, any Person (other than any such Person
that is a Lender at such time) that agrees to provide any portion of an Incremental Term Loan, or
Incremental Revolving Commitment Increase pursuant to an Incremental Amendment in accordance with
Section 2.14(h).
Adequate Protection Payments shall have the meaning ascribed thereto in the Interim
Cash Collateral Order.
Adjusted Available Delayed-Draw Term Loan Commitment shall mean at any time
the Available Delayed-Draw Term Loan Commitment less the Available Delayed-Draw Term Loan
Commitments of all Defaulting Lenders.
Adjusted Total Revolving Credit Commitment shall mean at any time the Total
Revolving Credit Commitment less the aggregate Revolving Credit Commitments of all Defaulting
Lenders.
Administrative Agent shall mean Citibank, N.A., as the administrative agent for the
Lenders under this Agreement and the other Credit Documents, or any successor administrative agent
pursuant to Section 12.
Administrative Agents Office shall mean the Administrative Agents address and, as
appropriate, account as set forth on Schedule 13.2, or such other address or account as the Administrative
Agent may from time to time notify to the Borrower and the Lenders.
Administrative Questionnaire shall have the meaning provided in
Section 13.6(b)(ii)(D).
Advisors shall mean legal counsel, financial advisors and third-party appraisers and
consultants advising the Agents, the Letter of Credit Issuers, the Lenders and their Related Parties in
connection with their participation in the Cases, limited in the case of legal counsel to one primary
counsel for the Agents (as of the Closing Date, Milbank, Tweed, Hadley & McCloy LLP) and, if
necessary, one firm of regulatory counsel and/or one firm of local counsel in each appropriate jurisdiction
(and, in the case of an actual or perceived conflict of interest where the Person affected by such conflict
informs the Borrower of such conflict and thereafter, after receipt of the consent of the Borrower (which
consent shall not be unreasonably withheld or delayed), retains its own counsel, of another firm of
counsel for such affected Person).
Affiliate shall mean, with respect to any Person, any other Person directly or indirectly
controlling, controlled by, or under direct or indirect common control with such Person. A Person shall
be deemed to control another Person if such Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such other Person, whether through the ownership

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#4821-7663-6950
of voting securities, by contract or otherwise. The terms controlling and controlled shall have
meanings correlative thereto.
Affiliate Value Transfer shall mean any Investment made in reliance on Section
10.5(c), (g), (h), (i), (k), (l), (m), (p), (q), (t), (u), (v), (aa), (cc), (dd), (ee) or (ff) (including the issuance of
Letters of Credit for the direct or indirect benefit of the Ultimate Parent and its Subsidiaries (other than
the Borrower and the Restricted Subsidiaries)), any Disposition made in reliance on Section 10.4(b), (g)
or (m) or any distribution made in reliance on Section 10.6(u), in each case made by the Borrower or any
Restricted Subsidiary to an Affiliate thereof (other than the Borrower and the Restricted Subsidiaries),
excluding payments, transfers or Dispositions to such Affiliates (including the issuance of Letters of
Credit for the benefit of Ultimate Parent and its Subsidiaries) pursuant to the Shared Services Agreement
or the Tax Sharing Agreement.
Agent Parties shall have the meaning provided in Section 13.17(d).
Agents shall mean the Administrative Agent, the Collateral Agent, the Co-Syndication
Agents, each J oint Lead Arranger and the Co-Documentation Agents.
Aggregate Revolving Credit Outstandings shall have the meaning provided in
Section 5.2(b).
Agreement shall mean this Senior Secured Superpriority Debtor-in-Possession Credit
Agreement.
Annual Operating Forecast shall have the meaning provided in Section 9.1(d). For
the avoidance of doubt, no Annual Operating Forecast shall constitute a cap or limitation on the amount
of Allowed Professional Fees (as defined in the Orders) payable by the TCEH Debtors.
Anti-Corruption Laws shall have the meaning provided in Section 8.20.
Applicable ABR Margin shall mean at any date:
(a) with respect to each ABR Loan that is a Term Loan, 1.75% per annum, (b) with
respect to each ABR Loan that is a Delayed-Draw Term Loan, 1.75% per annum and (c) with respect to
each ABR Loan that is a Revolving Credit Loan, 1.50% per annum.
Applicable Amount shall mean, at any time (the Applicable Amount Reference
Time), an amount (which amount may not in any event be less than zero (0)) equal to the sum, without
duplication, of:
(i) 50% of Cumulative Consolidated Net Income of the Borrower and the Restricted
Subsidiaries for the period from the first day of the first fiscal quarter commencing after the
Closing Date until the last day of the then most recent fiscal quarter or fiscal year, as applicable,
for which Section 9.1 Financials have been delivered;
(ii) to the extent not (A) already included in the calculation of Consolidated Net
Income of the Borrower and the Restricted Subsidiaries or (B) already reflected as a return of
capital or deemed reduction in the amount of such Investment, the aggregate J V Distribution
Amount received by the Borrower or any Restricted Subsidiary during the period from and
including the Business Day immediately following the Closing Date through and including the
Applicable Amount Reference Time;

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#4821-7663-6950
(iii) to the extent not (A) already included in the calculation of Consolidated Net
Income or (B) already reflected as a return of capital or deemed reduction in the amount of any
such Investment, the aggregate amount of all cash repayments of principal received by the
Borrower or any Restricted Subsidiary from any Minority Investments or Unrestricted
Subsidiaries during the period from and including the Business Day immediately following the
Closing Date through and including the Applicable Amount Reference Time in respect of loans
made by the Borrower or any Restricted Subsidiary to such Minority Investments or Unrestricted
Subsidiaries; and
(iv) to the extent not (A) already included in the calculation of Consolidated Net
Income of the Borrower and the Restricted Subsidiaries, (B) already reflected as a return of
capital or deemed reduction in the amount of such Investment or (C) applied to prepay the Term
Loans and Delayed-Draw Term Loans in accordance with Section 5.2(a), the aggregate amount of
all Net Cash Proceeds received by the Borrower or any Restricted Subsidiary in connection with
the sale, transfer or other disposition of its ownership interest in any Minority Investments or in
any Unrestricted Subsidiary during the period from and including the Business Day immediately
following the Closing Date through and including the Applicable Amount Reference Time;
minus (b) the sum, without duplication of:
(i) the aggregate amount of Investments made pursuant to Section 10.5(g)(ii)(y),
10.5(h)(iii), 10.5(i)(y) or 10.5(v)(y) following the Closing Date and prior to the Applicable
Amount Reference Time; and
(ii) the aggregate amount of prepayments pursuant to Section 10.7(ii) following the
Closing Date and prior to the Applicable Amount Reference Time.
Notwithstanding the foregoing, in making any calculation or other determination under
this Agreement involving the Applicable Amount, if the Applicable Amount at such time is less than
zero, then the Applicable Amount shall be deemed to be zero for purposes of such calculation or
determination.
Applicable Equity Amount shall mean, at any time (the Applicable Equity Amount
Reference Time), an amount equal to, without duplication, (a) the amount of any capital contributions
made in cash to, or any proceeds of an equity issuance received by the Borrower during the period from
and including the Business Day immediately following the Closing Date through and including the
Applicable Equity Amount Reference Time, including proceeds from the issuance of Stock or Stock
Equivalents of Parent Guarantor or any direct or indirect parent of Parent Guarantor (to the extent the
proceeds of any such issuance are contributed to the Borrower), but excluding all proceeds from the
issuance of Disqualified Stock
minus (b) the sum, without duplication, of:
(i) the aggregate amount of Investments made pursuant to Section 10.5(g)(ii)(x),
10.5(h)(ii), 10.5(i)(x) or 10.5(v)(x) following the Closing Date and prior to the Applicable Equity
Amount Reference Time; and
(ii) the aggregate amount of dividends pursuant to Section 10.6(c)(y) following the
Closing Date and prior to the Applicable Equity Amount Reference Time.

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#4821-7663-6950
Applicable Laws shall mean, as to any Person, any law (including common law),
statute, regulation, ordinance, rule, order, decree, judgment, consent decree, writ, injunction, settlement
agreement or governmental requirement enacted, promulgated or imposed or entered into or agreed by
any Governmental Authority (including the PUCT and ERCOT), in each case applicable to or binding on
such Person or any of its property or assets or to which such Person or any of its property or assets is
subject.
Applicable LIBOR Margin shall mean at any date:
(a) with respect to each LIBOR Loan that is a Term Loan, 2.75% per annum, (b)
with respect to each LIBOR Loan that is a Delayed-Draw Term Loan, 2.75% per annum and (c) with
respect to each LIBOR Loan that is a Revolving Credit Loan, 2.50% per annum.
Approved Fund shall mean any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.
Asset Sale Prepayment Event shall mean any Disposition of any business units, assets
or other property of the Borrower and the Restricted Subsidiaries not in the ordinary course of business
(including any Disposition of any Stock or Stock Equivalents of any Subsidiary of the Borrower owned
by the Borrower or any Restricted Subsidiary). Notwithstanding the foregoing, the term Asset Sale
Prepayment Event shall not include any transaction permitted by Section 10.4 (other than transactions
permitted by Section 10.4(b), Section 10.4(g), the first proviso to Section 10.4(i), Section 10.4(j),
Section 10.4(m), Section 10.4(q), Section 10.4(r), Section 10.4(s) and Section 10.4(t), which shall
constitute Asset Sale Prepayment Events).
Assignment and Acceptance shall mean an assignment and acceptance substantially
in the form of Exhibit I, or such other form as may be approved by the Administrative Agent.
Authorized Officer shall mean the President, the Chief Executive Officer, the Chief
Financial Officer, the Chief Operating Officer, the Treasurer, the Assistant Treasurer, the Controller, any
Senior Vice President, with respect to certain limited liability companies or partnerships that do not have
officers, any manager, managing member or general partner thereof, any other senior officer of Parent
Guarantor, the Borrower or any other Credit Party designated as such in writing to the Administrative
Agent by Parent Guarantor, the Borrower or any other Credit Party, as applicable, and, with respect to any
document (other than the solvency certificate) delivered on the Closing Date, the Secretary or the
Assistant Secretary of any Credit Party. Any document delivered hereunder that is signed by an
Authorized Officer shall be conclusively presumed to have been authorized by all necessary corporate,
limited liability company, partnership and/or other action on the part of Parent Guarantor, the Borrower or
any other Credit Party and such Authorized Officer shall be conclusively presumed to have acted on
behalf of such Person.
Auto-Extension Letter of Credit shall have the meaning provided in Section 3.2(b).
Available Delayed-Draw Term Loan Commitment shall mean, as of any date, an
amount equal to the excess, if any, of (a) the amount of the Total Delayed Draw Term Loan Commitment
over (b) the sum of the aggregate principal amount of all Delayed Draw Term Loans made hereunder
prior to such date.

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Available Revolving Commitment shall mean, as of any date, an amount equal to the
excess, if any, of (a) the amount of the Total Revolving Credit Commitment over (b) the aggregate
principal amount of all Revolving Credit Loans then-outstanding at such time.
Available Term Loan Commitment shall mean, (a) as of the Closing Date, the
Interim Availability Amount and (b) as of the Full Availability Date, an amount equal to the excess, if
any, of (i) the amount of the Total Term Loan Commitment over (ii) the sum of the aggregate principal
amount of all Term Loans made hereunder prior to such date.
Avoidance Actions shall mean the Credit Parties claims and causes of action under
chapter 5 of the Bankruptcy Code or any other avoidance actions under the Bankruptcy Code (but
excluding causes of action arising under section 549 of the Bankruptcy Code and any related action under
section 550 of the Bankruptcy Code).
Bankruptcy Code shall mean The Bankruptcy Reform Act of 1978, as heretofore and
hereafter amended, and codified as 11 U.S.C. 101-1532.
Bankruptcy Court shall have the meaning assigned in the Recitals hereto.
Baseload Assets shall mean (a) any Baseload Generation Assets and (b) any other
assets comprising an electric generating facility or unit acquired, constructed or redesignated as such, in
each such case after the Closing Date that is certified by an Authorized Officer of the Borrower to be a
baseload asset.
Baseload Generation Assets shall mean the assets comprising the following
generation facilities, each owned by the Borrower and its Restricted Subsidiaries on the Closing Date:
Comanche Peak Unit 1 shall mean the approximately 1,150 megawatt (net load) nuclear
fueled power generation facility known as Comanche Peak Unit 1 being operated and
owned by Luminant Generation Company LLC in Somervell County and Hood County,
Texas;
Comanche Peak Unit 2 shall mean the approximately 1,150 megawatt (net load) nuclear
fueled power generation facility known as Comanche Peak Unit 2 being operated and
owned by Luminant Generation Company LLC in Somervell County and Hood County,
Texas;
Big Brown Unit 1 shall mean the approximately 575 megawatt (net load) lignite/coal
fired power generation facility, excluding mining properties, known as Big Brown Unit
1 being operated and owned by Big Brown Power Company LLC in Freestone County,
Texas;
Big Brown Unit 2 shall mean the approximately 575 megawatt (net load) lignite/coal
fired power generation facility, excluding mining properties, known as Big Brown Unit
2 being operated and owned by Big Brown Power Company LLC in Freestone County,
Texas;
Monticello Unit 1 shall mean the approximately 565 megawatt (net load) lignite/coal
fired power generation facility, excluding mining properties, known as Monticello Unit
1 being operated and owned by Luminant Generation Company LLC in Titus County,
Franklin County and Hopkins County, Texas;

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#4821-7663-6950
Martin Lake Unit 1 shall mean the approximately 750 megawatt (net load) lignite/coal
fired power generation facility, excluding mining properties, known as Martin Lake
Unit 1 being operated and owned by Luminant Generation Company LLC in Panola
County and Rusk County, Texas;
Oak Grove Unit 1 shall mean the approximately 800 megawatt (net load), lignite coal-
fired, power generation facility, excluding mining properties, known as Oak Grove Unit
1, being operated and owned by Oak Grove Management Company LLC in Robertson
County, Texas;
Oak Grove Unit 2 shall mean the approximately 800 megawatt (net load), lignite coal-
fired, power generation facility, excluding mining properties, known as Oak Grove Unit
2, being operated and owned by Oak Grove Management Company LLC in Robertson
County, Texas;
Sandow Unit 4; and
Sandow Unit 5 shall mean the approximately 580 megawatt (net load), lignite coal fired,
circulating fluidized bed power generation facility, excluding mining properties, known
as Sandow Unit 5 being operated and owned by Sandow Power Company LLC in
Milam County, Texas.

Benefited Lender shall have the meaning provided in Section 13.8(a).
Board shall mean the Board of Governors of the Federal Reserve System of the United
States (or any successor).
Borrower shall have the meaning provided in the preamble to this Agreement.
Borrowing shall mean and include (a) the incurrence of one Class and Type of Loan
on a given date having a single Maturity Date and in the case of LIBOR Loans, the same Interest Period
(provided that ABR Loans incurred pursuant to Section 2.10(b) shall be considered part of any related
Borrowing of LIBOR Loans).
Budget shall mean the Borrower and the Guarantors consolidated budget attached
hereto as Exhibit M (the Initial Budget) setting forth a statement of cash sources and uses of all free
cash flow for the next full 3 calendar months of the TCEH Debtors following the Interim Order Entry
Date, broken down month by month, including the anticipated uses of the Credit Facilities in such detail
as provided therein, and after such initial 3 calendar month period, at the end of each fiscal quarter (or, at
the election of the Borrower, at the end of each calendar month or such other earlier period as may be
agreed), an updated 3 month statement of the matters set forth above for the subsequent 3 month period in

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similar detail, in each case certified as to its reasonableness when made by an Authorized Officer of the
Borrower in the form of Exhibit C.
For the avoidance of doubt, no Budget shall constitute a cap or limitation on the amount
of Allowed Professional Fees (as defined in the Orders) payable by the TCEH Debtors.
Bundled Payment shall mean an amount paid or payable by an obligor to a Credit
Party pursuant to a bundled bill, which amount includes both (a) Excluded Property under clauses (a) or
(c) (or both such clauses) of the definition of such term, and (b) other amounts.
Bundled Payment Amount shall mean amounts paid or payable to any Credit Party
and described in clause (b) of the definition of Bundled Payment.
Business Day shall mean any day excluding Saturday, Sunday and any other day on
which banking institutions in New York City are authorized by law or other governmental actions to
close, and, if such day relates to (a) any interest rate settings as to a LIBOR Loan, (b) any fundings,
disbursements, settlements and payments in respect of any such LIBOR Loan, or (c) any other dealings
pursuant to this Agreement in respect of any such LIBOR Loan, such day shall be a day on which
dealings in deposits in Dollars are conducted by and between banks in the London interbank eurodollar
market.
Capital Expenditures shall mean, for any period, the aggregate of all expenditures
(whether paid in cash or accrued as liabilities and including in all events all amounts expended or
capitalized under Capital Leases) by the Borrower and the Restricted Subsidiaries during such period that,
in conformity with GAAP, are or are required to be included as capital expenditures on a consolidated
statement of cash flows of the Borrower.
Capital Lease shall mean, as applied to the Borrower and the Restricted Subsidiaries,
any lease of any property (whether real, personal or mixed) by the Borrower or any Restricted Subsidiary
as lessee that, in conformity with GAAP, is, or is required to be, accounted for as a capital lease on the
balance sheet of the Borrower; provided, however, that, notwithstanding anything to the contrary in this
Agreement or in any other Credit Document, any leases that were not capital leases when entered into but
are recharacterized as capital leases due to a change in accounting rules after the Closing Date shall for all
purposes of this agreement not be treated as Capital Leases.
Capitalized Lease Obligations shall mean, as applied to the Borrower and the
Restricted Subsidiaries at the time any determination is to be made, the amount of the liability in respect
of a Capital Lease that would at such time be required to be capitalized and reflected as a liability on the
balance sheet (excluding the footnotes thereto) of the Borrower in accordance with GAAP, and the Stated
Maturity thereof shall be the date of the last payment of rent or any other amount due under such Capital
Lease prior to the first date upon which such Capital Lease may be prepaid by the lessee without payment
of a penalty; provided, however, that, notwithstanding anything to the contrary in this Agreement or in
any other Credit Document, any obligations that were not required to be included on the balance sheet of
the Borrower as capital lease obligations when incurred but are recharacterized as capital lease obligations
due to a change in accounting rules after the Closing Date shall for all purposes of this Agreement not be
treated as Capitalized Lease Obligations.
Capitalized Software Expenditures shall mean, for any period, the aggregate of all
expenditures (whether paid in cash or accrued as liabilities) by the Borrower and the Restricted
Subsidiaries during such period in respect of purchased software or internally developed software and

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software enhancements that, in conformity with GAAP are or are required to be reflected as capitalized
costs on the consolidated balance sheet of the Borrower.
Carve Out shall have the meaning assigned to such term in the Orders (and shall
exclude, for the avoidance of doubt, cash or other amounts of cash equivalents on deposit to cash
collateralize Letters of Credit (including cash in the RCT L/C Collateral Accounts or General L/C
Collateral Accounts)).
Case and Cases shall each have the meaning assigned in the Recitals hereto.
Cash Collateral Account shall mean a blocked deposit account under the sole
dominion and control of the Collateral Agent, and otherwise established in a manner reasonably
satisfactory to the Collateral Agent.
Cash Management Agreement shall mean any agreement or arrangement to provide
Cash Management Services.
Cash Management Bank shall mean any Person that either (x) at the time it enters
into a Cash Management Agreement or provides Cash Management Services or (y) on the Closing Date,
is a Lender or an Affiliate of a Lender, in its capacity as a party to such Cash Management Agreement or
a provider of such Cash Management Services.
Cash Management Obligations shall mean obligations owed by the Borrower or any
Restricted Subsidiary to any Cash Management Bank in connection with, or in respect of, any Cash
Management Services or under any Cash Management Agreement.
Cash Management Order shall mean that certain Order (A) Authorizing the Debtors
To (I) Continue Using Their Existing Cash Management System, (II) Maintain Existing Bank Accounts
and Business Forms, and (III) Continue Using Certain Overnight Investment Accounts, (B) Authorizing
Continued Intercompany Transactions and Netting of Intercompany Claims, and (C) Granting
Postpetition Intercompany Claims Administrative Expense Priority [Docket No. __].
Cash Management Services shall mean treasury, depository, overdraft, credit or debit
card, purchase card, electronic funds transfer (including automated clearing house fund transfer services)
and other cash management services.
Change in Law shall mean (a) the adoption of any Applicable Law after the Closing
Date, (b) any change in any Applicable Law or in the interpretation or application thereof by any
Governmental Authority after the Closing Date or (c) compliance by any party with any guideline,
request, directive or order issued or made after the Closing Date by any central bank or other
governmental or quasi-governmental authority (whether or not having the force of law); provided, that
notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection
therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the
United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be
deemed to be a Change in Law, regardless of the date enacted, adopted or issued.
Change of Control shall mean and be deemed to have occurred if, at any time, Parent
Guarantor shall cease to own directly 100% of the Stock and Stock Equivalents of the Borrower.

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Chapter 11 shall have the meaning provided in the preamble to this Agreement.
Citi shall mean Citigroup Global Markets Inc.
Class, when used in reference to any Loan or Borrowing, shall refer to whether such
Loan, or the Loans comprising such Borrowing, is a Revolving Credit Loan, a Term Loan, a Delayed-
Draw Term Loan or an Incremental Term Loan and, when used in reference to any Commitment, refers to
whether such Commitment is a Term Loan Commitment, a Delayed-Draw Term Loan Commitment, a
Revolving Credit Commitment or an Incremental Term Loan Commitment.
Closing Date shall mean the first date following the Interim Order Entry Date on
which the conditions precedent set forth in Section 6 and in Sections 7.1 and 7.2 shall have been satisfied
or waived in accordance with Section 13.1 hereof (which in no event shall be more than five (5) Business
Days following the Interim Order Entry Date (or such later date as the Administrative Agent and the
Required Lenders may agree in their sole discretion)).
Code shall mean the Internal Revenue Code of 1986, as amended from time to time.
Section references to the Code are to the Code, as in effect on the Closing Date, and any subsequent
provisions of the Code, amendatory thereof, supplemental thereto or substituted therefor.
Co-Documentation Agents shall mean Barclays Bank PLC, Royal Bank of Canada
and Union Bank, N.A., as documentation agents for the Lenders under this Agreement and the other
Credit Documents.
Collateral shall mean all property pledged, mortgaged or purported to be pledged or
mortgaged pursuant to the Security Documents.
Collateral Agent shall mean, Citibank, N.A., in its capacity as collateral agent for the
Secured Parties under this Agreement and the Security Documents, or any successor collateral agent
appointed pursuant hereto.
Commitment Letter shall mean the commitment letter, dated April 28, 2014, among
the Borrower and the J oint Lead Arrangers.
Commitments shall mean, with respect to each Lender (to the extent applicable), such
Lenders Revolving Credit Commitment, New Revolving Credit Commitment, Incremental Term Loan
Commitment, Term Loan Commitment or Delayed-Draw Term Loan Commitment, and with respect to
each Letter of Credit Issuer, such Letter of Credit Issuers General Letter of Credit Commitment or RCT
Letter of Credit Commitment.
Commodity Exchange Act shall mean the Commodity Exchange Act (7 U.S.C. 1 et
seq.), as amended from time to time, and any successor statute.
Commodity Hedging Agreement shall mean any agreement (including each
confirmation pursuant to any Master Agreement) or transaction providing for one or more swaps, caps,
collars, floors, futures, options, spots, forwards, derivative, any physical or financial commodity contracts
or agreements, power purchase or sale agreements, fuel purchase or sale agreements, environmental credit
purchase or sale agreements, power transmission agreements, ancillary service agreements, commodity
transportation agreements, fuel storage agreements, weather derivatives, netting agreements (including
Netting Agreements), capacity agreements or commercial or trading agreements, each with respect to the
purchase, sale or exchange of (or the option to purchase, sell or exchange), transmission, transportation,

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storage, distribution, processing, lease or hedge of, any Covered Commodity, price or price indices for
any such Covered Commodity or services or any other similar derivative agreements, and any other
similar agreements.
Communications shall have the meaning provided in Section 13.17(a).
Confidential Information shall have the meaning provided in Section 13.16.
Consolidated Depreciation and Amortization Expense shall mean, with respect to
the Borrower and the Restricted Subsidiaries for any period, the total amount of depreciation and
amortization expense, including the amortization of deferred financing fees, nuclear fuel costs, depletion
of coal or lignite reserves, debt issuance costs, commissions, fees and expenses and Capitalized Software
Expenditures, of the Borrower and the Restricted Subsidiaries for such period on a consolidated basis and
otherwise determined in accordance with GAAP.
Consolidated EBITDA shall mean, for any period, Consolidated Net Income for such
period, plus:
(a) without duplication and to the extent deducted (and not added back) in arriving at
such Consolidated Net Income, the sum of the following amounts for the Borrower and the
Restricted Subsidiaries for such period:
(i) Consolidated Interest Expense (including (x) net losses on Hedging
Obligations or other derivative instruments entered into for the purpose of hedging
interest rate risk and (y) costs of surety bonds in connection with financing activities in
each case to the extent included in Consolidated Interest Expense), together with items
excluded from Consolidated Interest Expense pursuant to clause (1)(u), (v), (w), (x), (y)
and (z) of the definition thereof,
(ii) provision for taxes based on income or profits or capital gains, including
federal, foreign, state, franchise, excise, value-added and similar taxes and foreign
withholding taxes (including penalties and interest related to such taxes or arising from
tax examinations) paid or accrued during such period,
(iii) Consolidated Depreciation and Amortization Expense for such period,
(iv) any fees, expenses or charges (other than depreciation or amortization
expense) related to any offering of Stock or Stock Equivalents (including any Equity
Offering), Investment, acquisition (including any Permitted Acquisition), Disposition,
recapitalization or the issuance or incurrence of Indebtedness permitted to be incurred by
the Borrower and the Restricted Subsidiaries pursuant hereto (including any refinancing
transaction or amendment or other modification of any debt instrument), including (A)
such fees, expenses or charges related to the negotiation, execution and delivery and
other transactions contemplated by this Agreement, the other Credit Documents and any
Permitted Receivables Financing, (B) any amendment or other modification of this
Agreement and the other Credit Documents, (C) any such transaction consummated prior
to the Closing Date and any such transaction undertaken but not completed and (D) any
charges or non-recurring merger costs as a result of any such transaction;

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(v) the amount of any restructuring charge or reserve (including any costs
incurred in connection with acquisitions after the Closing Date and costs related to the
closure and/or consolidation of facilities),
(vi) any other non-cash charges, including any write-offs or write-downs for
such period (provided that if any such non-cash charges represent an accrual or reserve
for potential cash items in any future period, the cash payment in respect thereof in such
future period shall be subtracted from Consolidated EBITDA to such extent, and
excluding amortization of a prepaid cash item that was paid in a prior period),
(vii) the amount of any minority interest expense consisting of Subsidiary
income attributable to minority equity interests of third parties in any non-Wholly Owned
Subsidiary,
(viii) the amount of management, monitoring, consulting and advisory fees
and related indemnities and expenses paid in such period to (or on behalf of) the
Management Investors to the extent otherwise permitted pursuant to Section 9.9,
(ix) the amount of net cost savings projected by the Borrower in good faith to
be realized as a result of specified actions taken or to be taken prior to or during such
period (which cost savings shall be added to Consolidated EBITDA until fully realized,
shall be subject to certification by management of the Borrower and shall be calculated
on a Pro Forma Basis as though such cost savings had been realized on the first day of
such period), net of the amount of actual benefits realized during such period from such
actions; provided that (A) such cost savings are reasonably identifiable and factually
supportable, (B) such actions have been taken or are to be taken within 12 months after
the date of determination to take such action and some portion of the benefit is expected
to be realized within 12 months of taking such action, (C) no cost savings shall be added
pursuant to this clause (ix) to the extent duplicative of any expenses or charges relating to
such cost savings that are included in clause (v) above with respect to such period and
(D) the aggregate amount of cost savings added pursuant to this clause (ix) shall not
exceed $150,000,000 for any Test Period (which adjustments may be incremental to any
Pro Forma Adjustments),
(x) the amount of losses on Dispositions of receivables and related assets in
connection with any Permitted Receivables Financing and any losses, costs, fees and
expenses in connection with the early repayment, accelerated amortization, repayment,
termination or other payoff (including as a result of the exercise of remedies) of any
Permitted Receivables Financing,
(xi) any costs or expenses incurred pursuant to any management equity plan
or stock option plan or any other management or employee benefit plan or agreement or
any stock subscription or shareholder agreement, to the extent that such costs or expenses
are funded with cash proceeds contributed to the capital of the Borrower or net cash
proceeds of an issuance of Stock or Stock Equivalents (other than Disqualified Stock) of
the Borrower (or any direct or indirect parent thereof) solely to the extent that such net
cash proceeds are excluded from the calculation of the Applicable Equity Amount,
(xii) Expenses Relating to a Unit Outage (if positive); provided that the only
Expenses Relating to a Unit Outage that may be included as Consolidated EBITDA shall
be, without duplication, (A) up to $250,000,000 per fiscal year of Expenses Relating to a

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Unit Outage incurred within the first 12 months of any planned or unplanned outage of
any Unit by reason of any action by any regulatory body or other Governmental
Authority or to comply with any Applicable Law, (B) up to $100,000,000 per fiscal year
of Expenses Relating to a Unit Outage incurred within the first 12 months of any planned
outage of any Unit for purposes of expanding or upgrading such Unit and (C) solely for
the purposes of calculating Consolidated EBITDA for purposes of Section 10.9, all
Expenses Relating to a Unit Outage incurred within the first 12 months of any unplanned
outage of any Unit,
(xiii) solely for the purposes of calculating Consolidated EBITDA for
purposes of Section 10.9, the proceeds of any business interruption insurance and,
without duplication of such amounts, all EBITDA Lost as a Result of a Unit Outage and
all EBITDA Lost as a Result of a Grid Outage less, in all such cases, the absolute value
of Expenses Relating to a Unit Outage (if negative); provided that the amount calculated
pursuant to this clause (xiii) shall not be less than zero,
(xiv) restructuring-related or other similar charges, fees, costs, commissions
and expenses or other charges incurred during such period in connection with this
Agreement, the other Credit Documents, the Credit Facilities, the Cases, any
reorganization plan in connection with the Cases, any Exit Credit Agreements and Exit
Facilities, and any and all transactions contemplated by the foregoing, including the
write-off of any receivables, the termination or settlement of executory contracts,
professional and accounting costs fees and expenses, management incentive, employee
retention or similar plans (in each case to the extent such plan is approved by the
Bankruptcy Court to the extent required), litigation costs and settlements, asset write-
downs, income and gains recorded in connection with the corporate reorganization of the
TCEH Debtors,
(xv) unusual or non-recurring charges (including unusual or non-recurring
expenses), severance, relocation costs, consolidation and closing costs, business
optimization costs, transition costs, restructuring costs, signing, retention or completion
bonuses, and curtailments or modifications to pension and post-retirement employee
benefit plans for such period,
(xvi) any impairment charge or asset write-off or write-down including
impairment charges or asset write-offs or write-downs related to intangible assets, long-
lived assets and Investments in debt and equity securities, in each case pursuant to
GAAP, and the amortization of intangibles arising pursuant to GAAP,
(xvii) cash receipts (or any netting arrangements resulting in increased cash
receipts) not added in arriving at Consolidated EBITDA or Consolidated Net Income in
any period to the extent the non-cash gains relating to such receipts were deducted in the
calculation of Consolidated EBITDA pursuant to paragraph (b) below for any previous
period and not added, and
(xviii) to the extent covered by insurance and actually reimbursed, or, so long as
the Borrower has made a determination that there exists reasonable evidence that such
amount will in fact be reimbursed by the insurer and only to the extent that such amount
is (i) not denied by the applicable carrier in writing within 180 days and (ii) in fact
reimbursed within 365 days of the date of such evidence (with a deduction for any

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amount so added back to the extent not so reimbursed within 365 days), expenses with
respect to liability or casualty events or business interruption, less
(b) without duplication and to the extent included in arriving at such Consolidated
Net Income for the Borrower and the Restricted Subsidiaries, the sum of the following amounts
for such period:
(i) non-cash gains increasing Consolidated Net Income for such period
(excluding any non-cash gain to the extent it represents the reversal of an accrual or
reserve for a potential cash item that reduced Consolidated Net Income or Consolidated
EBITDA in any prior period),
(ii) unusual or non-recurring gains,
(iii) cash expenditures (or any netting arrangements resulting in increased
cash expenditures) not deducted in arriving at Consolidated EBITDA or Consolidated
Net Income in any period to the extent non-cash losses relating to such expenditures were
added in the calculation of Consolidated EBITDA pursuant to paragraph (a) above for
any previous period and not deducted, and
(iv) the amount of any minority interest income consisting of Subsidiary
losses attributable to minority equity interests of third parties in any non-Wholly Owned
Subsidiary,
in each case, as determined on a consolidated basis for the Borrower and the Restricted Subsidiaries in
accordance with GAAP; provided that
(i) to the extent included in Consolidated Net Income, there shall be excluded in
determining Consolidated EBITDA any gain or loss resulting in such period from currency
translation gains and losses related to currency remeasurements of Indebtedness or intercompany
balances (including the net loss or gain resulting from Hedging Obligations for currency
exchange risk),
(ii) there shall be included in determining Consolidated EBITDA for any period,
without duplication, (A) the Acquired EBITDA of any Person or business, or attributable to any
property or asset, acquired by the Borrower or any Restricted Subsidiary during such period (but
not the Acquired EBITDA of any related Person or business or any Acquired EBITDA
attributable to any assets or property, in each case to the extent not so acquired) to the extent not
subsequently sold, transferred, abandoned or otherwise disposed by the Borrower or such
Restricted Subsidiary (each such Person, business, property or asset acquired (including pursuant
to the Transactions) and not subsequently so disposed of, an Acquired Entity or Business) and
the Acquired EBITDA of any Unrestricted Subsidiary that is converted into a Restricted
Subsidiary during such period (each, a Converted Restricted Subsidiary), in each case based
on the actual Acquired EBITDA of such Pro Forma Entity for such period (including the portion
thereof occurring prior to such acquisition or conversion) and (B) an adjustment in respect of
each Pro Forma Entity equal to the amount of the Pro Forma Adjustment with respect to such Pro
Forma Entity for such period (including the portion thereof occurring prior to such acquisition) as
specified in a Pro Forma Adjustment Certificate and delivered to the Administrative Agent (for
further delivery to the Lenders),
(iii) [Reserved],

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(iv) to the extent included in Consolidated Net Income, there shall be excluded in
determining Consolidated EBITDA for any period the Disposed EBITDA of any Person,
property, business or asset (other than an Unrestricted Subsidiary) sold, transferred, abandoned or
otherwise disposed of, closed or classified as discontinued operations by the Borrower or any
Restricted Subsidiary during such period (each such Person, property, business or asset so sold,
transferred, abandoned or otherwise disposed of, or closed or so classified, a Sold Entity or
Business), and the Disposed EBITDA of any Restricted Subsidiary that is converted into an
Unrestricted Subsidiary during such period (each, a Converted Unrestricted Subsidiary), in
each case based on the actual Disposed EBITDA of such Sold Entity or Business or Converted
Unrestricted Subsidiary for such period (including the portion thereof occurring prior to such sale,
transfer or disposition, closure, classification or conversion).
Notwithstanding anything to the contrary contained herein, for purposes of determining
Consolidated EBITDA under this Agreement (i) for any period that includes any of the fiscal
quarters ended September 30, 2013, December 31, 2013, or March 31, 2014, Consolidated
EBITDA for such quarter, shall be $500,000,000, $300,000,000 and $350,000,000, respectively
and (ii) for any period that includes any fiscal month ended April 30, 2014, Consolidated
EBITDA for such month shall be $10,000,000.
Consolidated Interest Expense shall mean, with respect to any period, without
duplication, the sum of:
(1) consolidated interest expense of the Borrower and the Restricted Subsidiaries for
such period, to the extent such expense was deducted (and not added back) in computing
Consolidated Net Income (including (a) amortization of original issue discount resulting from the
issuance of Indebtedness at less than par, (b) all commissions, discounts and other fees and
charges owed with respect to letters of credit, bankers acceptances or collateral posting facilities,
(c) non-cash interest payments (but excluding any non-cash interest expense attributable to the
movement in the mark to market valuation of Hedging Obligations or other derivative
instruments pursuant to GAAP), (d) the interest component of Capitalized Lease Obligations and
(e) net payments, if any, pursuant to interest rate Hedging Obligations with respect to
Indebtedness, and excluding (u) accretion of asset retirement obligations and accretion or accrual
of discounted liabilities not constituting Indebtedness, (v) any expense resulting from the
discounting of any Indebtedness in connection with the application of purchase accounting,
(w) [reserved], (x) amortization of reacquired Indebtedness, deferred financing fees, debt issuance
costs, commissions, fees and expenses, (y) any expensing of bridge, commitment and other
financing fees and (z) commissions, discounts, yield and other fees and charges (including any
interest expense) related to any Permitted Receivables Financing); plus
(2) consolidated capitalized interest of (A) the Borrower and the Restricted
Subsidiaries, in each case for such period, whether paid or accrued; less
(3) interest income for such period; plus
(4) all cash dividends or other distributions paid (excluding items eliminated in
consolidation) on any series of Preferred Stock during such period; plus
(5) all cash dividends or other distributions paid (excluding items eliminated in
consolidation) on any series of Disqualified Stock during such period.

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For purposes of this definition, interest on a Capitalized Lease Obligation shall be deemed to accrue at an
interest rate reasonably determined by such Person to be the rate of interest implicit in such Capitalized
Lease Obligation in accordance with GAAP.
Consolidated Net Income shall mean, for any period, the net income (loss) of the
Borrower and the Restricted Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, excluding, without duplication,
(a) any after-tax effect of extraordinary losses and gains for such period,
(b) Transaction Expenses,
(c) the cumulative effect of a change in accounting principles during such period,
(d) any after-tax effect of income (or loss) from disposed, abandoned or discontinued
operations and any net after-tax gains or losses on disposal of disposed, abandoned, transferred,
closed or discontinued operations,
(e) any after-tax effect of gains or losses (less all fees and expenses relating thereto)
attributable to asset dispositions or abandonments other than in the ordinary course of business, as
determined in good faith by the Borrower,
(f) any income (or loss) during such period of any Person that is an Unrestricted
Subsidiary, and any income (or loss) during such period of any Person that is not a Subsidiary or
that is accounted for by the equity method of accounting; provided that the Consolidated Net
Income of the Borrower and the Restricted Subsidiaries shall be increased by the amount of
dividends or distributions or other payments that are actually paid in cash (or to the extent
converted into cash) to the Borrower or any Restricted Subsidiary during such period,
(g) solely for the purpose of determining the Applicable Amount, any income (or
loss) during such period of any Restricted Subsidiary (other than any Credit Party) to the extent
that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary
of its net income is not at the date of determination wholly permitted without any prior
governmental approval or an order of the Bankruptcy Court (which has not been obtained) or,
directly or indirectly, by the operation of the terms of its Organizational Documents or any
agreement, instrument or Applicable Law applicable to that Restricted Subsidiary or its
stockholders, unless such restriction with respect to the payment of dividends or similar
distributions has been legally waived (in each case, other than restrictions pursuant to this
Agreement); provided that Consolidated Net Income of the Borrower and the Restricted
Subsidiaries will be increased by the amount of dividends or other distributions or other payments
actually paid in cash (or to the extent converted into cash) to the Borrower or any Restricted
Subsidiary during such period, to the extent not already included therein,
(h) effects of all adjustments (including the effects of such adjustments pushed down
to the Borrower and the Restricted Subsidiaries) in the Borrowers consolidated financial
statements pursuant to GAAP resulting from the application of purchase accounting in relation to
the Transactions or any consummated acquisition whether consummated before or after the
Closing Date or the amortization or write-off of any amounts thereof, net of taxes,

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(i) any net after-tax effect of income (or loss) for such period attributable to the
early extinguishment of Indebtedness (other than Hedging Obligations, but including, for the
avoidance of doubt, debt exchange transactions),
(j) any net after-tax effect of any unrealized income (or loss) for such period
attributable to Hedging Obligations or other derivative instruments,
(k) any impairment charge or asset write-off or write-down including impairment
charges or asset write-offs or write-downs related to intangible assets, long-lived assets and
investments in debt and equity securities to the extent relating to changes in commodity prices, in
each case pursuant to GAAP to the extent offset by gains from Hedging Obligations,
(l) any non-cash compensation expense recorded from grants of stock appreciation
or similar rights, stock options, restricted stock or other rights, and any cash charges associated
with the rollover, acceleration or payout of Stock or Stock Equivalents by management of the
Borrower or any of its direct or indirect parent companies in connection with the Transactions,
and
(m) accruals and reserves established or adjusted within twelve months after the
Closing Date that are so required to be established as a result of the Transactions in accordance
with GAAP or changes as a result of adoption of or modification of accounting policies during
such period.
Consolidated Superpriority Secured Net Debt shall mean, as of any date of
determination as determined in respect of the Borrower and its Restricted Subsidiaries for such period on
a consolidated basis in a balance sheet in accordance with GAAP, (a) all Indebtedness of the types
described in clause (a), clause (b), clause (d) (but, in the case of clause (d), only to the extent of any
unreimbursed drawings under any RCT Letter of Credit or General Letter of Credit) and clause (f) of the
definition thereof, in each case, solely to the extent consisting of the outstanding Term Loans, Delayed-
Draw Term Loans and the Revolving Credit Exposure (determined for this purpose as if the Revolving
Credit Commitment of each Lender outstanding from time to time has been fully drawn), minus (b) the
aggregate amount of all Unrestricted Cash.
Consolidated Superpriority Secured Net Debt to Consolidated EBITDA Ratio
shall mean, as of any date of determination, the ratio of (a) Consolidated Superpriority Secured Net Debt
as of such date of determination to (b) Consolidated EBITDA for such Test Period.
Consolidated Total Assets shall mean, as of any date of determination, the amount
that would, in conformity with GAAP, be set forth opposite the caption total assets (or any like
caption), after intercompany eliminations, on a consolidated balance sheet of the Borrower and the
Restricted Subsidiaries at such date.
Contingent Obligation shall mean indemnification Obligations and other similar
contingent Obligations for which no claim has been made in writing (but excluding, for the avoidance of
doubt, amounts available to be drawn under Letters of Credit).
Continuing Director shall mean, at any date, an individual (a) who is a member of the
board of directors of the Borrower on the Closing Date, (b) who, as of the date of determination, has been
a member of such board of directors for at least the twelve preceding months, (c) who has been nominated
to be a member of such board of directors, directly or indirectly, by a Permitted Holder or Persons

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nominated by a Permitted Holder or (d) who has been nominated to be a member of such board of
directors by a majority of the other Continuing Directors then in office.
Contractual Requirement shall have the meaning provided in Section 8.3.
Converted Restricted Subsidiary shall have the meaning provided in the definition of
the term Consolidated EBITDA.
Converted Unrestricted Subsidiary shall have the meaning provided in the definition
of the term Consolidated EBITDA.
Co-Syndication Agents shall mean Deutsche Bank AG New York Branch, Bank of
America, N.A. and Morgan Stanley Senior Funding, Inc., as syndication agents for the Lenders under this
Agreement and the other Credit Documents.
Covered Commodity shall mean any energy, electricity, generation capacity, power,
heat rate, congestion, natural gas, nuclear fuel (including enrichment and conversion), diesel fuel, fuel oil,
other petroleum-based liquids, coal, lignite, weather, emissions and other environmental credits, waste
by-products, renewable energy credit, or any other energy related commodity or service (including
ancillary services and related risks (such as location basis)).
Credit Documents shall mean this Agreement, the Guarantee, the Security
Documents, each Letter of Credit and any promissory notes issued by the Borrower hereunder.
Credit Event shall mean and include the making (but not the conversion or
continuation) of a Loan and the issuance of a Letter of Credit.
Credit Facility shall mean any of the Term Loan Facility, the Delayed-Draw Term
Facility, any Incremental Term Loan Facility and the Revolving Credit Facility.
Credit Party shall mean each of Parent Guarantor, the Borrower, each of the
Subsidiary Guarantors and each other Subsidiary of the Borrower that is a party to a Credit Document.
CT Lease Indebtedness shall mean obligations owing by Parent Guarantor (or certain
trusts directly or indirectly beneficially owned by Parent Guarantor) under Indebtedness issued by such
trusts and secured by the combustion turbines owned by such trusts that are subject to the CT Leases.
CT Leases shall mean (a) the leveraged lease with respect to combustion turbines at
the Permian Basin and DeCordova facilities (with approximately $35,000,000 of 7.48% trust issued debt
outstanding as of March 31, 2014) and (b) the leveraged lease with respect to combustion turbines at the
Morgan Creek and Permian Basin facilities (with approximately $4,000,000 of 7.46% trust issued debt
outstanding as of March 31, 2014).
Cumulative Consolidated Net Income shall mean, for any period, Consolidated Net
Income for such period, taken as a single accounting period. Cumulative Consolidated Net Income may
be a positive or negative amount.
DBSI shall mean Deutsche Bank Securities Inc.
Debtor Relief Laws shall mean the Bankruptcy Code and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement,

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receivership, insolvency, reorganization, or similar debtor relief Applicable Laws of the United States or
other applicable jurisdictions from time to time in effect.
Deemed Cash shall have the meaning provided in Section 10.4(b).
Default shall mean any event, act or condition that with notice or lapse of time, or
both, would constitute an Event of Default.
Default Rate shall have the meaning provided in Section 2.8(d).
Defaulting Lender shall mean any Lender with respect to which a Lender Default is in
effect.
Deferred Net Cash Proceeds shall have the meaning provided such term in the
definition of Net Cash Proceeds.
Deferred Net Cash Proceeds Payment Date shall have the meaning provided such
term in the definition of Net Cash Proceeds.
Delayed-Draw Term Facility shall mean the facility providing for the Delayed-Draw
Term Loans.
Delayed-Draw Term Facility Reduction Amount shall mean the sum of (1) the
aggregate amount of voluntary reductions to the Delayed-Draw Term Loan Commitment made pursuant
to Sections 4.2 or 4.3 and (2) the amount of Available Delayed-Draw Term Loan Commitments
permanently terminated on the Delayed-Draw Termination Date.
Delayed-Draw Term Loan Commitment shall mean, (a) in the case of each Lender
that is a Lender on the date hereof, the amount set forth opposite such Lenders name on Schedule 1.1(a)
as such Lenders Delayed-Draw Term Loan Commitment and (b) in the case of any Lender that
becomes a Lender after the date hereof, the amount specified as such Lenders Delayed Draw Term
Loan Commitment in the Assignment and Acceptance pursuant to which such Lender assumed a portion
of the Total Delayed-Draw Term Loan Commitment, in each case as the same may be changed from time
to time pursuant to the terms hereof. The aggregate amount of Delayed-Draw Term Loan Commitments
outstanding as of the Closing Date is $1,100,000,000.
Delayed-Draw Term Loan Lender shall mean each Lender holding a Delayed-Draw
Term Loan.
Delayed-Draw Term Loans shall have the meaning provided in Section 2.1(b). As set
forth in Section 2.1(b)(ii), immediately after any Delayed-Draw Term Loans are funded pursuant to
Section 2.1(b), such Loans will automatically be deemed to constitute Term Loans, and to not constitute
Delayed-Draw Term Loans, for all purposes of this Credit Agreement and the other Credit Documents
(except for purposes of the definitions of Available Delayed-Draw Term Loan Commitment and
Available Term Loan Commitment).
Delayed-Draw Termination Date shall mean the date that is 90 days after the Closing
Date.
Delayed-Draw Ticking Fee shall have the meaning provided in Section 4.1(e).

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Designated Non-Cash Consideration shall mean the fair market value of non-cash
consideration received by the Borrower or any Restricted Subsidiary in connection with a Disposition
pursuant to Section 10.4(b) or Section 10.4(m) that is designated as Designated Non-Cash Consideration
pursuant to a certificate of an Authorized Officer of the Borrower, setting forth the basis of such valuation
(which amount will be reduced by the fair market value of the portion of the non-cash consideration
converted to cash within 180 days following the consummation of the applicable Disposition).
Disclosure Statement shall mean a Disclosure Statement that is [in form and substance
consistent in all material respects with, and as it may be amended in accordance with the terms of, the
Restructuring Support Agreement and the Restructuring Term Sheet, and is] in form and substance
reasonably satisfactory to the Administrative Agent (provided, however, that with respect to provisions of
the Disclosure Statement that relate to the payment of the Credit Facilities, such provisions must be in
form and substance satisfactory to the Administrative Agent).
Disposed EBITDA shall mean, with respect to any Sold Entity or Business or any
Converted Unrestricted Subsidiary for any period, the amount for such period of Consolidated EBITDA
of such Sold Entity or Business or Converted Unrestricted Subsidiary (determined as if references to the
Borrower and the Restricted Subsidiaries in the definition of Consolidated EBITDA were references to
such Sold Entity or Business or Converted Unrestricted Subsidiary and its respective Subsidiaries), all as
determined on a consolidated basis for such Sold Entity or Business or Converted Unrestricted
Subsidiary, as the case may be.
Disposition shall have the meaning provided in Section 10.4.
Disqualified Institutions shall mean (a) any company engaged principally in the
business of energy or power generation and/or transmission and identified in writing to the
Administrative Agent by the Borrower from time to time, (b) any company whose principal business is
that of an energy or power merchant and identified in writing to the Administrative Agent by the
Borrower from time to time, (c) any Person identified in writing to the Administrative Agent by the
Borrower on or prior to April 28, 2014 (including any such Persons affiliates that are clearly identifiable
on the basis of such affiliates names) and (d) any Defaulting Lender. The list of all Disqualified
Institutions shall be made available to all Lenders by posting such list to the Platform. Upon the
identification in writing by the Borrower to the Administrative Agent of any additional Disqualified
Institutions pursuant to clause (a) or (b) above, the Administrative Agent shall promptly post such
addition to the list to the Platform; provided that any additional Person so identified shall not be deemed a
Disqualified Institution until such time as such addition to the list is posted to the Platform.
Disqualified Stock shall mean, with respect to any Person, any Stock or Stock
Equivalents of such Person which, by its terms, or by the terms of any security into which it is convertible
or for which it is putable or exchangeable, or upon the happening of any event, matures or is mandatorily
redeemable (other than solely for Stock or Stock Equivalents that is not Disqualified Stock), other than as
a result of a change of control, asset sale or similar event so long as any rights of the holders thereof upon
the occurrence of such change of control, asset sale or similar event shall be subject to the prior
repayment in full of the Loans and all other Obligations (other than Hedging Obligations under Secured
Hedging Agreements and/or Secured Commodity Hedging Agreements, Cash Management Obligations
under Secured Cash Management Agreements or Contingent Obligations and the termination of the
Commitments), pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the
holder thereof (other than as a result of a change of control, asset sale or similar event so long as any
rights of the holders thereof upon the occurrence of such change of control, asset sale or similar event
shall be subject to the prior repayment in full of the Loans and all other Obligations (other than Hedging
Obligations under Secured Hedging Agreements and/or Secured Commodity Hedging Agreements, Cash

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Management Obligations under Secured Cash Management Agreements or Contingent Obligations and
the termination of the Commitments), in whole or in part, in each case prior to the date that is ninety-one
(91) days after the Latest Maturity Date; provided that if such Stock or Stock Equivalents are issued to
any plan for the benefit of employees of the Borrower or any of its Subsidiaries or by any such plan to
such employees, such Stock or Stock Equivalents shall not constitute Disqualified Stock solely because it
may be required to be repurchased by the Borrower (or any direct or indirect parent company thereof) or
any of its Subsidiaries in order to satisfy applicable statutory or regulatory obligations; provided, further,
that any Stock or Stock Equivalents held by any present or former employee, officer, director, manager or
consultant, of the Borrower, any of its Subsidiaries or any of its direct or indirect parent companies or any
other entity in which the Borrower or any Restricted Subsidiary has an Investment and is designated in
good faith as an affiliate by the Board of Directors of the Borrower, in each case pursuant to any
stockholders agreement, management equity plan or stock incentive plan or any other management or
employee benefit plan or agreement shall not constitute Disqualified Stock solely because it may be
required to be repurchased by the Borrower or any of its Subsidiaries.
dividends shall have the meaning provided in Section 10.6.
Dollars and $ shall mean dollars in lawful currency of the United States of America.
Domestic Subsidiary shall mean each Subsidiary of the Borrower that is organized
under the laws of the United States or any state thereof, or the District of Columbia.
Drawing shall have the meaning provided in Section 3.4(b).
EBITDA Lost as a Result of a Grid Outage shall mean, to the extent that any
transmission or distribution lines go out of service, the revenue not actually earned by the Borrower and
its Restricted Subsidiaries that would otherwise have been earned with respect to any Unit within the first
12 month period that such transmission or distribution lines were out of service had such transmission or
distribution lines not been out of service during such period.
EBITDA Lost as a Result of a Unit Outage shall mean, to the extent that any Unit is
out of service as a result of any unplanned outage or shut down, the revenue not actually earned by the
Borrower and its Restricted Subsidiaries that would otherwise have been earned with respect to any such
Unit during the first 12 month period of any such outage or shut down had such Unit not been out of
service during such period.
EFIH shall mean Energy Future Intermediate Holding Company LLC, a Delaware
limited liability company.
Employee Benefit Plan shall mean an employee benefit plan (as defined in Section
3(3) of ERISA), other than a Foreign Plan, that is maintained or contributed to by the Ultimate Parent,
Parent Guarantor, Borrower or any Subsidiary (or, with respect to an employee benefit plan subject to
Title IV of ERISA, any ERISA Affiliate).
Environmental CapEx shall mean Capital Expenditures deemed reasonably necessary
by the Borrower or any Restricted Subsidiary or otherwise undertaken voluntarily by the Borrower or any
Restricted Subsidiary, to comply with, or in anticipation of having to comply with, applicable
Environmental Laws or Capital Expenditures otherwise undertaken voluntarily by the Borrower or any
Restricted Subsidiary in connection with environmental matters.

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Environmental Claims shall mean any and all actions, suits, proceedings, orders,
decrees, demands, demand letters, claims, liens, notices of noncompliance, violation or potential
responsibility or investigation (other than reports prepared by or on behalf of the Ultimate Parent, Parent
Guarantor, the Borrower or any other Subsidiary of the Ultimate Parent (a) in the ordinary course of such
Persons business or (b) as required in connection with a financing transaction or an acquisition or
disposition of Real Estate) or proceedings relating in any way to any Environmental Law or any permit
issued, or any approval given, under any such Environmental Law (hereinafter, Claims), including
(i) any and all Claims by Governmental Authorities for enforcement, cleanup, removal, response,
remedial or other actions or damages pursuant to any applicable Environmental Law and (ii) any and all
Claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief relating to the presence, release or threatened release into the environment of Hazardous
Materials or arising from alleged injury or threat of injury to human health or safety (to the extent relating
to human exposure to Hazardous Materials), or to the environment, including ambient air, indoor air,
surface water, groundwater, land surface and subsurface strata and natural resources such as wetlands.
Environmental Law shall mean any applicable Federal, state, foreign or local statute,
law, rule, regulation, ordinance, code and rule of common law now or, with respect to any post-Closing
Date requirements of the Credit Documents, hereafter in effect and in each case as amended, and any
binding judicial or administrative interpretation thereof, including any binding judicial or administrative
order, consent decree or judgment, relating to the protection of the environment, including ambient air,
indoor air, surface water, groundwater, land surface and subsurface strata and natural resources such as
wetlands, or to human health or safety (to the extent relating to human exposure to Hazardous Materials),
or Hazardous Materials.
Equity Offering shall mean any public or private sale of common stock or Preferred
Stock of the Borrower or any of its direct or indirect parent companies (excluding Disqualified Stock),
other than: (a) public offerings with respect to the Borrowers or any direct or indirect parent companys
common stock registered on Form S-8, and (b) issuances to any Subsidiary of the Borrower or any such
parent.
ERCOT shall mean the Electric Reliability Council of Texas or any other entity
succeeding thereto.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time. Section references to ERISA are to ERISA as in effect on the Closing Date
and any subsequent provisions of ERISA amendatory thereof, supplemental thereto or substituted
therefor.
ERISA Affiliate shall mean each person (as defined in Section 3(9) of ERISA) that
together with the Borrower or any Subsidiary of the Borrower would be deemed to be a single
employer within the meaning of Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
Event of Default shall have the meaning provided in Section 11.
Exchange Act shall mean the Securities Exchange Act of 1934, as amended, and rules
and regulations promulgated thereunder.
Exchange Rate shall mean on any day, with respect to any currency, the rate at which
such currency may be exchanged into another currency, which shall be the Historical Exchange Rate on
the immediately prior day as determined by OANDA Corporation and made available on its website at

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http://www.oanda.com/convert/fxhistory; provided, that the Administrative Agent may obtain such spot
rate from another financial institution designated by the Administrative Agent if at the time of any such
determination, for any reason, no such rate is being quoted.
Excluded Collateral shall mean (a) Excluded Stock and Stock Equivalents, (b)
Excluded Subsidiaries, (c) Excluded Property and (d) (i) property or assets subject to capital leases,
purchase money obligations and other arrangements described in Section 10.1(f) to the extent subject to a
Lien, in each case permitted by this Agreement, and the terms of the Indebtedness secured by such Lien
prohibit assignment of, or granting of a security interest in, the applicable Credit Partys rights and
interests therein (other than to the extent that any such prohibition would be rendered ineffective pursuant
to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any
relevant jurisdiction or any other Applicable Law), provided, that immediately upon the repayment of all
Indebtedness secured by such Lien, such property shall no longer constitute Excluded Collateral and
such Credit Party shall be deemed to have granted a security interest in all the rights and interests with
respect to such property or assets pursuant to the applicable Credit Documents, (ii) any assets as to which
the Collateral Agent and the Borrower have reasonably determined (after giving effect to the effectiveness
of the Orders) that the costs or other consequences (including adverse tax consequences) of providing a
security interest in such assets is excessive in view of the benefits to be gained thereby by the Lenders,
(iii) any property that would otherwise constitute Collateral to the extent (and only to the extent) that the
grant of a security interest therein or perfection of a Lien thereon pursuant to the applicable Credit
Documents would violate any Applicable Law or regulation (including regulations adopted by Federal
Energy Regulatory Commission and/or the Nuclear Regulatory Commission) applicable to such property
and (iv) the Borrowers Avoidance Actions (other than, upon entry of the Final Order, proceeds or
property recovered, unencumbered, or otherwise the subject of successful Avoidance Actions, whether by
judgment, settlement or otherwise).
Excluded Property shall mean (a) Receivables Facility Assets purported to be sold,
contributed or pledged by any Credit Party that is or becomes a participant in a Permitted Receivables
Financing pursuant to a Permitted Receivables Financing, (b) collections or proceeds of Receivables
Facility Assets repurchased by any Credit Party that is or becomes a participant in a Permitted
Receivables Financing pursuant to the provisions of a Permitted Receivables Financing, while such
collections or proceeds are in a lockbox, collateral account or similar account established pursuant to such
Permitted Receivables Financing to receive collections of Receivables Facility Assets or are in an account
subject to an intercreditor agreement related to Transition Charges or Transition Property, (c) amounts
payable to any Credit Party that such Credit Party is collecting on behalf of Persons that are not Credit
Parties, including Transition Property and Transition Charges, and any customer deposits related to the
foregoing, and (d) any Bundled Payment Amounts, while such Bundled Payment Amounts are in a
lockbox, collateral account or similar account established pursuant to a Permitted Receivables Financing
to receive collections of Receivables Facility Assets or are in an account subject to an intercreditor
agreement related to Transition Charges or Transition Property.
Excluded Stock and Stock Equivalents shall mean (i) any Stock or Stock Equivalents
with respect to which, in the reasonable judgment of the Collateral Agent (confirmed in writing by notice
to the Borrower and the Administrative Agent), the cost or other consequences (including any adverse tax
or accounting consequences) of pledging such Stock or Stock Equivalents in favor of the Secured Parties
under the Security Documents shall be excessive in view of the benefits to be obtained by the Secured
Parties therefrom, (ii) solely in the case of any pledge of Voting Stock of any Foreign Subsidiary or
Foreign Subsidiary Holding Company to secure the Obligations, any Stock or Stock Equivalents of any
class of such Foreign Subsidiary or Foreign Subsidiary Holding Company in excess of 65% of the
outstanding Voting Stock of such class (such percentage to be adjusted upon any Change in Law as may
be required to avoid adverse U.S. federal income tax consequences to Parent Guarantor, the Borrower or

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any Subsidiary of the Borrower), (iii) any Stock or Stock Equivalents to the extent the pledge thereof
would violate any Applicable Law, (iv) in the case of any Stock or Stock Equivalents of any Subsidiary of
the Borrower that is not Wholly Owned by the Borrower or any Subsidiary Guarantor at the time such
Subsidiary becomes a Subsidiary, any Stock or Stock Equivalents of each such Subsidiary to the extent
(A) that a pledge thereof to secure the Obligations is prohibited by any applicable Contractual
Requirement (other than customary non-assignment provisions which are ineffective under the Uniform
Commercial Code or other Applicable Law or any Organizational Document), (B) any Contractual
Requirement prohibits such a pledge without the consent of any other party; provided that this clause (B)
shall not apply if (x) such other party is a Credit Party or Wholly Owned Subsidiary or (y) consent has
been obtained to consummate such pledge (it being understood that the foregoing shall not be deemed to
obligate the Borrower or any Subsidiary of the Borrower to obtain any such consent)) and for so long as
such Contractual Requirement or replacement or renewal thereof is in effect, or (C) a pledge thereof to
secure the Obligations would give any other party (other than a Credit Party or Wholly Owned
Subsidiary) to any contract, agreement, instrument or indenture governing such Stock or Stock
Equivalents the right to terminate its obligations thereunder (other than customary non-assignment
provisions which are ineffective under the Uniform Commercial Code or other applicable law), (v) the
Stock or Stock Equivalents of any Subsidiary of a Foreign Subsidiary, (vi) any Stock or Stock
Equivalents of any Subsidiary to the extent that (A) the pledge of such Stock or Stock Equivalents would
result in adverse tax or accounting consequences to the Borrower or any Subsidiary as reasonably
determined by the Borrower and (B) such Stock or Stock Equivalents have been identified in writing to
the Collateral Agent by an Authorized Officer of the Borrower, (vii) the Stock or Stock Equivalents of
any Unrestricted Subsidiary or Immaterial Subsidiary and (viii) the Stock or Stock Equivalents of any
Receivables Entity if, after using commercially reasonable efforts, the Borrower is unable to obtain the
consent of the funding sources under the applicable Permitted Receivables Financing to the pledge of
such Stock or Stock Equivalents. Notwithstanding the foregoing, the term Excluded Stock and Stock
Equivalents shall not in any event include the Stock or Stock Equivalents of any Subsidiary that is a
debtor and debtor-in-possession in the Cases.
Excluded Subsidiary shall mean (a) each Domestic Subsidiary listed on
Schedule 1.1(b) hereto and each future Domestic Subsidiary, in each case, for so long as any such
Subsidiary does not constitute a Material Subsidiary, (b) each Domestic Subsidiary that is not a Wholly
Owned Subsidiary on any date such Subsidiary would otherwise be required to become a Subsidiary
Guarantor pursuant to the requirements of Section 9.11 (for so long as such Subsidiary remains a non-
Wholly Owned Restricted Subsidiary), (c) any Foreign Subsidiary Holding Company, (d) each Domestic
Subsidiary that is prohibited by any applicable Contractual Requirement, Applicable Law or
Organizational Document from guaranteeing or granting Liens to secure the Obligations at the time such
Subsidiary becomes a Restricted Subsidiary (and for so long as such restriction or any replacement or
renewal thereof is in effect), (e) each Domestic Subsidiary that is a Subsidiary of a Foreign Subsidiary,
(f) any other Domestic Subsidiary with respect to which, in the reasonable judgment of the Administrative
Agent (confirmed in writing by notice to the Borrower), the cost or other consequences (including any
adverse tax or accounting consequences) of guaranteeing the Obligations shall be excessive in view of the
benefits to be obtained by the Secured Parties therefrom, (g) each Unrestricted Subsidiary, (h) any
Foreign Subsidiary, (i) any Receivables Entity and (j) any Subsidiary to the extent that (A) the guarantee
of the Obligations by would result in adverse tax or accounting consequences and (B) such Subsidiaries
have been identified in writing to the Collateral Agent by an Authorized Officer of the Borrower.
Notwithstanding the foregoing, the term Excluded Subsidiary shall not in any event include any
Subsidiary that is a debtor and debtor-in-possession in the Cases.
Excluded Swap Obligation shall mean, with respect to any Guarantor, any Swap
Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by
such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or

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becomes illegal or unlawful under the Commodity Exchange Act or any rule, regulation or order of the
Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by
virtue of such Guarantors failure for any reason to constitute an eligible contract participant as defined
in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee of such
Guarantor or the grant of such security interest would otherwise have become effective with respect to
such Swap Obligation but for such Guarantors failure to constitute an eligible contract participant at
such time.
Excluded Taxes shall mean, with respect to any Agent or any Lender, (a) net income
taxes and franchise and excise taxes (imposed in lieu of net income taxes) imposed on such Agent or
Lender, (b) any Taxes imposed on any Agent or any Lender as a result of any current or former
connection between such Agent or Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political subdivision or taxing authority thereof or therein (other than any such connection
arising from such Agent or Lender having executed, delivered or performed its obligations or received a
payment under, or having been a party to or having enforced, this Agreement or any other Credit
Document), (c) any U.S. federal withholding tax that is imposed on amounts payable to any Lender under
the law in effect at the time such Lender becomes a party to this Agreement (or designates a new lending
office other than a new lending office designated at request of the Borrower); provided that this subclause
(c) shall not apply to the extent that (x) the indemnity payments or additional amounts any Lender would
be entitled to receive (without regard to this subclause (c)) do not exceed the indemnity payment or
additional amounts that the person making the assignment, participation or transfer to such Lender (or
designation of a new lending office by such Lender) would have been entitled to receive in the absence of
such assignment or (y) any Tax is imposed on a Lender in connection with an interest in any Loan or
other obligation that such Lender was required to acquire pursuant to Section 13.8(a) or that such Lender
acquired pursuant to Section 13.7 (it being understood and agreed, for the avoidance of doubt, that any
withholding tax imposed on a Lender as a result of a Change in Law occurring after the time such Lender
became a party to this Agreement (or designates a new lending office) shall not be an Excluded Tax),(d)
any Tax to the extent attributable to such Lenders failure to comply with Sections 5.4(d) and (e) (in the
case of any Non-U.S. Lender) or Section 5.4(h) (in the case of a U.S. Lender), and (e) any Taxes imposed
by FATCA.
Exit Credit Agreements shall mean each of the credit agreements for the Exit
Facilities of the reorganized Borrower and consistent in form and substance in all material respects with
the Exit Facility Term Sheet, with such amendments, modifications, supplements and changes permitted
or agreed to pursuant to the terms of the Restructuring Support Agreement or otherwise.
Exit Facilities shall mean, collectively, the credit facilities under the Exit Credit
Agreements.
Exit Facility Term Sheet shall mean the term sheet in respect of the Exit Credit
Agreements attached as Exhibit C to the Restructuring Term Sheet.
Expenses Relating to a Unit Outage shall mean an amount (which may be negative)
equal to (x) any expenses or other charges as a result of any outage or shut-down of any Unit, including
any expenses or charges relating to (a) restarting any such Unit so that it may be placed back in service
after such outage or shut-down, (b) purchases of power, natural gas or heat rate to meet commitments to
sell, or offset a short position in, power, natural gas or heat rate that would otherwise have been met or
offset from production generated by such Unit during the period of such outage or shut-down and (c)
starting up, operating, maintaining and shutting down any other Unit that would not otherwise have been
operating absent such outage or shut-down, including the fuel and other operating expenses, incurred to
start-up, operate, maintain and shut-down such Unit and that are required during the period of time that

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the shut-down or outaged Unit is out of service in order to meet the commitments of such shut-down or
outaged Unit to sell, or offset a short position in, power, natural gas or heat rate less (y) any expenses or
charges not in fact incurred (including fuel and other operating expenses) that would have been incurred
absent such outage or shut-down.
Extension Conditions shall have the meaning provided in the definition of Maturity
Date.
FATCA shall mean Sections 1471 through 1474 of the Code as of the Closing Date (or
any amended or successor version that is substantively comparable and not materially more onerous to
comply with) and any current or future Treasury regulations or official administrative interpretations
thereof.
Federal Funds Effective Rate shall mean, for any day, the weighted average of the
per annum rates on overnight federal funds transactions with members of the Federal Reserve System
arranged by federal funds brokers on such day, as published on the next succeeding Business Day by the
Federal Reserve Bank of New York; provided that (a) if such day is not a Business Day, the Federal
Funds Effective Rate for such day shall be such rate on such transactions on the next preceding Business
Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such
next succeeding Business Day, the Federal Funds Effective Rate for such day shall be the average rate
(rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to the Administrative Agent
on such day on such transactions as determined by the Administrative Agent.
Fee Letter shall mean the fee letter, dated April 28, 2014, among the Borrower and the
J oint Lead Arrangers.
Fees shall mean all amounts payable pursuant to, or referred to in, Section 4.1.
Final Cash Collateral Order shall mean a final order of the Bankruptcy Court entered
in the Cases in form and substance satisfactory to the Administrative Agent on a motion by the TCEH
Debtors that is in form and substance satisfactory to the TCEH Debtors, authorizing and approving on a
final basis, among other things, the matters and provisions in the Interim Cash Collateral Order.
Final Order shall mean a final order of the Bankruptcy Court entered in the Cases in
form and substance satisfactory to the Left Lead Arrangers on a motion by the TCEH Debtors that is in
form and substance satisfactory to the Left Lead Arrangers, authorizing and approving on a final basis,
among other things, the matters and provisions in the Interim Order and the borrowing by the Borrower of
the full amount of the Credit Facilities, as such order or orders may be extended, amended, supplemented
or modified in a manner satisfactory to the Left Lead Arrangers.
Final Order Entry Date shall mean the date that the Final Order is entered by the
Bankruptcy Court in the Cases.
Financial Advisor shall mean Millstein & Co., L.P.
First Day Orders shall mean all orders entered or to be entered by the Bankruptcy
Court based on the motions identified on Schedule 1.1(d) hereto, which shall each be in form and
substance reasonably satisfactory to the Left Lead Arrangers (other than the Cash Management Order, the
Interim Order, and the Interim Cash Collateral Order, which shall each be in form and substance
satisfactory to the Left Lead Arrangers).

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Fiscal Year shall have the meaning provided in Section 9.10.
Foreign Asset Sale shall have the meaning provided in Section 5.2(i).
Foreign Plan shall mean any employee benefit plan, program, policy, arrangement or
agreement maintained or contributed to by the Borrower or any of its Subsidiaries with respect to
employees employed outside the United States.
Foreign Recovery Event shall have the meaning provided in Section 5.2(i).
Foreign Subsidiary shall mean each Subsidiary of the Borrower that is not a Domestic
Subsidiary.
Foreign Subsidiary Holding Company shall mean any Subsidiary that owns no
material assets other than equity interest (including, for this purpose, any debt or other instrument treated
as equity for U.S. federal income tax purposes) in one or more (a) Foreign Subsidiaries and/or (b) other
Subsidiaries that own no material assets other than equity interests (including, for this purpose, any debt
or other instrument treated as equity for U.S. federal income tax purposes) in one or more Foreign
Subsidiaries.
Fronting Fee shall have the meaning provided in Section 4.1(c).
Full Availability Date shall mean the first date following the Final Order Entry Date
on which the conditions precedent set forth in Section 6 and Section 7 shall have been satisfied or waived
in accordance with Section 13.1.
Fund shall mean any Person (other than a natural person) that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit
in the ordinary course.
GAAP shall mean generally accepted accounting principles in the United States of
America, as in effect from time to time; provided, however, that if the Borrower notifies the
Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the
effect of any change occurring after the Closing Date in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the Borrower that the Required
Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such
notice is given before or after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such provision amended in
accordance herewith.
General L/C Cash Coverage Requirement shall have the meaning provided in
Section 3.8.
General L/C Collateral Account shall mean one or more Cash Collateral Accounts or
securities accounts established pursuant to, and subject to the terms of, Section 3.8 for the purpose of
collateralizing the General L/C Obligations in respect of General Letters of Credit.
General L/C Collateral Account Balance shall mean, at any time, with respect to any
General L/C Collateral Account, the aggregate amount on deposit in such General L/C Collateral
Account. References herein and in the other Credit Documents to the General L/C Collateral Account

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Balance shall be deemed to refer to the General L/C Collateral Account Balance in respect of the
applicable General L/C Collateral Account or to the General L/C Collateral Account Balance in respect of
all General L/C Collateral Accounts, as the context requires.
General L/C Collateral Account Depositary Bank shall have the meaning provided
in Section 3.8.
General L/C Obligations shall mean, as at any date of determination and without
duplication, the aggregate Stated Amount of all outstanding General Letters of Credit plus the aggregate
principal amount of all Unpaid Drawings under all General Letters of Credit. For all purposes of this
Agreement, if on any date of determination a General Letter of Credit has expired by its terms but any
amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such General
Letter of Credit shall be deemed to be outstanding in the amount so remaining available to be drawn.
General L/C Permitted Investments shall mean:
(a) any Permitted Investments described in clauses (a) through (g) of the definition
thereof; and
(b) such other securities as agreed to by the TCEH Debtors with the applicable
General Letter of Credit Issuer from time to time.
General L/C Termination Date shall mean the Maturity Date.
General Letter of Credit shall have the meaning provided in Section 3.1(a)(i).
General Letter of Credit Commitment shall mean $800,000,000 (as such amount
may be increased as agreed in writing between the Borrower and the General Letter of Credit Issuers
providing such increased General Letter of Credit Commitment, and as such amount may be reduced
pursuant to Section 4.2(d)).
General Letter of Credit Issuers shall mean (a) on the date hereof, Citibank, N.A.
and (b) at any time such Person who shall become a General Letter of Credit Issuer pursuant to Section
3.6 (it being understood that if any such Person ceases to be a Lender hereunder, such Person will remain
a General Letter of Credit Issuer with respect to any General Letters of Credit issued by such Person that
remained outstanding as of the date such Person ceased to be a Lender). Any General Letter of Credit
Issuer may, in its discretion, arrange for one or more General Letters of Credit to be issued by Affiliates
of such General Letter of Credit Issuer, and in each such case the term General Letter of Credit Issuer
shall include any such Affiliate with respect to General Letters of Credit issued by such Affiliate.
References herein and in the other Credit Documents to the General Letter of Credit Issuer shall be
deemed to refer to the General Letter of Credit Issuer in respect of the applicable General Letter of Credit
or to all General Letter of Credit Issuers, as the context requires.
General Letters of Credit Outstanding shall mean, at any time, with respect to any
General Letter of Credit Issuer, the sum of, without duplication, (a) the aggregate Stated Amount of all
outstanding General Letters of Credit issued by such General Letter of Credit Issuer and (b) the aggregate
principal amount of all Unpaid Drawings in respect of all such General Letters of Credit. References
herein and in the other Credit Documents to the General Letters of Credit Outstanding shall be deemed to
refer to the General Letters of Credit Outstanding in respect of all General Letters of Credit issued by the
applicable General Letter of Credit Issuer or to the General Letters of Credit Outstanding in respect of all
General Letters of Credit, as the context requires.

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General Letter of Credit Reimbursement Obligations shall mean the obligations of
the TCEH Debtors to reimburse and repay Unpaid Drawings on any General Letter of Credit pursuant to
the terms and conditions set forth in Section 3.4 of this Agreement.
General L/C Collateral Account Depositary Bank shall have the meaning provided
in Section 3.8.
Governmental Authority shall mean any nation, sovereign or government, any state,
province, territory or other political subdivision thereof, and any entity or authority exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining to government, including a
central bank, stock exchange, PUCT or ERCOT.
Granting Lender shall have the meaning provided in Section 13.6(g).
Guarantee shall mean the Guarantee made by each Guarantor in favor of the
Collateral Agent for the benefit of the Secured Parties, substantially in the form of Exhibit B.
Guarantee Obligations shall mean, as to any Person, any obligation of such Person
guaranteeing or intended to guarantee any Indebtedness of any other Person (the primary obligor) in
any manner, whether directly or indirectly, including any obligation of such Person, whether or not
contingent, (a) to purchase any such Indebtedness or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any such Indebtedness or (ii) to
maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (c) to purchase property, securities or services primarily for the purpose
of assuring the owner of any such Indebtedness of the ability of the primary obligor to make payment of
such Indebtedness or (d) otherwise to assure or hold harmless the owner of such Indebtedness against loss
in respect thereof; provided, however, that the term Guarantee Obligations shall not include
endorsements of instruments for deposit or collection in the ordinary course of business or customary and
reasonable indemnity obligations in effect on the Closing Date or entered into in connection with any
acquisition or disposition of assets permitted under this Agreement (other than such obligations with
respect to Indebtedness). The amount of any Guarantee Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the Indebtedness in respect of which such Guarantee
Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in
good faith.
Guarantors shall mean (a) Parent Guarantor, (b) each Domestic Subsidiary that is a
party to the Guarantee on the Closing Date, which will in any event include all Subsidiaries that are
debtors and debtors-in-possession in the Cases, and (c) each Domestic Subsidiary that becomes a party to
the Guarantee on or after the Closing Date pursuant to Section 9.11 or otherwise.
Hazardous Materials shall mean (a) any petroleum or petroleum products spilled or
released into the environment, radioactive materials, friable asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls, and radon gas; (b) any chemicals, materials or substances defined as or
included in the definition of hazardous substances, hazardous waste, hazardous materials,
extremely hazardous waste, restricted hazardous waste, toxic substances, toxic pollutants,
contaminants, or pollutants, or words of similar import, under any applicable Environmental Law;
and (c) any other chemical, material or substance, for which a release into the environment is prohibited,
limited or regulated by any Environmental Law.

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Hedge Bank shall mean any Person (other than Parent Guarantor, the Borrower or any
other Subsidiary of the Borrower) that either (i) is a party to a Secured Commodity Hedging Agreement
and has executed and delivered to the Collateral Agent an Accession Agreement, and become a party to
the Security Agreement, pursuant to Section 14.2 or (ii) with respect to any other Hedging Agreement
(other than a Commodity Hedging Agreement) either (x) at the time it enters into a Secured Hedging
Agreement or (y) on the Closing Date, is a Lender or an Affiliate of a Lender, in its capacity as a party to
a Secured Hedging Agreement.
Hedging Agreements shall mean (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or
options or forward bond or forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency
swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other
similar transactions or any combination of any of the foregoing (including any options to enter into any of
the foregoing), whether or not any such transaction is governed by or subject to any master agreement,
(b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the International Swaps and
Derivatives Association, Inc., any International Foreign Exchange Master Agreement or any other master
agreement (any such master agreement, together with any related schedules, a Master Agreement),
including any such obligations or liabilities under any Master Agreement and (c) physical or financial
commodity contracts or agreements, power purchase or sale agreements, fuel purchase or sale
agreements, environmental credit purchase or sale agreements, power transmission agreements, ancillary
service agreements, commodity transportation agreements, fuel storage agreements, weather derivatives,
netting agreements (including Netting Agreements), capacity agreements and commercial or trading
agreements, each with respect to the purchase, sale or exchange of (or the option to purchase, sell or
exchange), transmission, transportation, storage, distribution, processing, sale, lease or hedge of, any
Covered Commodity, price or price indices for any such Covered Commodity or services or any other
similar derivative agreements, and any other similar agreements.
Hedging and Trading Order shall mean that certain Final Order Authorizing the
Debtors To (A) Continue Performance Under the Hedging and Trading Arrangements, (B) Pledge
Collateral and Honor Obligations Thereunder, and (C) Enter Into and Perform Under New Postpetition
Hedging and Trading Arrangements [Docket No. __].
Hedging Obligations shall mean, with respect to any Person, the obligations of such
Person under Hedging Agreements.
Holdings shall mean Texas Energy Future Holdings Limited Partnership, a Delaware
limited partnership, and its successors.
Immaterial Subsidiary shall mean each Subsidiary of the Borrower that is not a
Material Subsidiary.
Incremental Amendment shall have the meaning set forth in Section 2.14(h).
Incremental Facility shall have the meaning provided in Section 2.14(a).
Incremental Revolving Commitment Increase shall have the meaning provided in
Section 2.14(a).

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Incremental Term Loan Commitment shall mean the commitment of any lender to
make Incremental Term Loans of a particular tranche pursuant to Section 2.14(a).
Incremental Term Loan Facility shall mean each tranche of Incremental Term Loans
made pursuant to Section 2.14.
Incremental Term Loans shall have the meaning provided in Section 2.14(a).
Indebtedness of any Person shall mean (a) all indebtedness of such Person for
borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments, (c) the deferred purchase price of assets or services that in
accordance with GAAP would be included as a liability on the balance sheet of such Person, (d) the face
amount of all letters of credit issued for the account of such Person and, without duplication, all drafts
drawn thereunder, (e) all Indebtedness of any other Person secured by any Lien on any property owned by
such Person, whether or not such Indebtedness has been assumed by such Person, (f) the principal
component of all Capitalized Lease Obligations of such Person, (g) net Hedging Obligations of such
Person, (h) without duplication, all Guarantee Obligations of such Person and (i) Disqualified Stock of
such Person; provided that Indebtedness shall not include (i) trade and other ordinary course payables and
accrued expenses arising in the ordinary course of business, (ii) deferred or prepaid revenue, (iii) purchase
price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other
unperformed obligations of the respective seller, (iv) amounts payable by and between Parent Guarantor,
the Borrower and any other Subsidiary of the Ultimate Parent in connection with retail clawback or other
regulatory transition issues and (v) any Indebtedness defeased by such Person or by any Subsidiary of
such Person. The amount of any net Hedging Obligations on any date shall be deemed to be the Swap
Termination Value. The amount of Indebtedness of any Person for purposes of clause (e) shall be deemed
to be equal to the lesser of (i) the aggregate unpaid amount of such Indebtedness and (ii) the fair market
value of the property encumbered thereby as determined by such Person in good faith.
indemnified liabilities shall have the meaning provided in Section 13.5.
Indemnified Taxes shall mean all Taxes (including Other Taxes) other than (i)
Excluded Taxes and (ii) any interest, penalties or expenses caused by an Agents or Lenders gross
negligence or willful misconduct.
Initial Budget shall have the meaning provided in the definition of the term Budget.
Intercompany Subordinated Note shall mean the Intercompany Note, dated as of
April 7, 2011, executed by Parent Guarantor, the Borrower and each Restricted Subsidiary of the
Borrower.
Interest Period shall mean, with respect to any Term Loan, Delayed-Draw Term Loan
or Revolving Credit Loan, the interest period applicable thereto, as determined pursuant to Section 2.9.
Interim Availability Amount shall mean, as of any date of determination (x) with
respect to the Revolving Credit Facility, the lesser of (a) $800,000,000 and (b) such amount as the
Bankruptcy Court may order or as may be agreed by the Required Lenders and the Borrower, (y) with
respect to the Term Loan Facility, the lesser of (a) $800,000,000 and (b) such amount as the Bankruptcy
Court may order or as may be agreed by the Required Lenders and the Borrower, and (z) with respect to
the Delayed-Draw Term Facility, the lesser of (a) $1,100,000,000 and (b) such amount as the Bankruptcy
Court may order or as may be agreed by the Required Lenders and the Borrower.

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Interim Cash Collateral Order shall mean that certain Interim Order (A) Authorizing
Use of Cash Collateral, (B) Granting Adequate Protection, (C) Modifying the Automatic Stay, and (D)
Scheduling a Final Hearing [Docket No. __].
Interim Order shall mean that certain Interim Order (A) Approving Postpetition
Financing for Texas Competitive Electric Holdings Company LLC and Certain of Its Debtor Affiliates,
(B) Granting Liens and Providing Superpriority Administrative Expense Claims, (C) Modifying the
Automatic Stay, and (D) Scheduling a Final Hearing [Docket No. __] attached as Exhibit N hereto, in
form and substance satisfactory to the Left Lead Arrangers on a motion by the TCEH Debtors that is in
form and substance satisfactory to the Left Lead Arrangers, as such order or orders may be extended,
amended, supplemented or modified in a manner satisfactory to the Left Lead Arrangers.
Interim Order Entry Date shall mean the date on which the Interim Order is entered
by the Bankruptcy Court.
Interim Period shall mean the period of time between the Interim Order Entry Date
and the Final Order Entry Date.
Investment shall mean, for any Person: (a) the acquisition (whether for cash, property,
services or securities or otherwise) of Stock, Stock Equivalents, bonds, notes, debentures, partnership,
limited liability company membership or other ownership interests or other securities of any other Person
(including any short sale or any sale of any securities at a time when such securities are not owned by
the Person entering into such sale), (b) the making of any deposit with, or advance, loan or other
extension of credit to, any other Person (including the purchase of property from another Person subject
to an understanding or agreement, contingent or otherwise, to resell such property to such Person)
(including any partnership or joint venture), (c) the entering into of any guarantee of, or other contingent
obligation with respect to, Indebtedness; or (d) the purchase or other acquisition (in one transaction or a
series of transactions) of all or substantially all of the property and assets or business of another Person or
assets constituting a business unit, line of business or division of such Person; provided that, in the event
that any Investment is made by the Borrower or any Restricted Subsidiary in any Person through
substantially concurrent interim transfers of any amount through one or more other Restricted
Subsidiaries, then such other substantially concurrent interim transfers shall be disregarded for purposes
of Section 10.5.
ISP shall mean, with respect to any Letter of Credit, the International Standby
Practices 1998 published by the Institute of International Banking Law & Practice (or such later version
thereof as may be in effect at the time of issuance).
Issuer Documents shall mean with respect to any Letter of Credit, the Letter of Credit
Request, and any other document, agreement and instrument entered into by a Letter of Credit Issuer and
the Ultimate Parent, Parent Guarantor, the Borrower or any Subsidiary of the Ultimate Parent (other than
the Oncor Subsidiaries) or in favor of a Letter of Credit Issuer and relating to such Letter of Credit.
Joint Lead Arrangers shall mean Citi, DBSI, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Morgan Stanley Senior Funding, Inc., Barclays Bank PLC, RBC Capital Markets and
Union Bank, N.A., as joint lead arrangers and joint bookrunners for the Lenders under this Agreement
and the other Credit Documents.
JV Distribution Amount shall mean, at any time, the aggregate amount of cash
dividends and other cash distributions received by the Borrower or any Restricted Subsidiary from any
Minority Investments or any Unrestricted Subsidiary since the Closing Date and prior to such time and

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only to the extent that neither the Borrower nor any Restricted Subsidiary is under any obligation to repay
such amount to such Minority Investments or such Unrestricted Subsidiary.
Latest Maturity Date shall mean, at any date of determination, the latest maturity date
applicable to any Credit Facility hereunder as of such date of determination, including the latest maturity
date of any Incremental Facility, in each case as extended in accordance with this Agreement from time to
time.
Left Lead Arrangers shall mean Citi and DBSI.
Lender shall have the meaning provided in the preamble to this Agreement.
Lender Default shall mean (a) the failure (which has not been cured) of a Lender to
make available its portion of any Borrowing or (b) a Lender having notified the Administrative Agent
and/or the Borrower that it does not intend to comply with the obligations under Section 2.1(a), 2.1(b) or
2.1(c), as the case may be, or (c) a Lender having (i) become the subject of a proceeding under any
Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator,
assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its
business or assets, including the Federal Deposit Insurance Corporation or any other state or federal
regulatory authority acting in such a capacity.
Letter of Credit shall mean each RCT Letter of Credit and each General Letter of
Credit.
Letter of Credit Issuer shall mean, with respect to any RCT Letter of Credit, each
RCT Letter of Credit Issuer, and with respect to any General Letter of Credit, any General Letter of Credit
Issuer.
Letter of Credit Request shall have the meaning provided in Section 3.2(a).
LIBOR Loan shall mean any Term Loan, Delayed-Draw Term Loan or Revolving
Credit Loan bearing interest at a rate determined by reference to the LIBOR Rate.
LIBOR Rate shall mean, for any Interest Period with respect to a LIBOR Loan the rate
per annum equal to the ICE Benchmark Administration (or any successor organization) LIBOR Rate
(ICE LIBOR), as published by Reuters (or other commercially available source providing quotations
of ICE LIBOR as designated by the Administrative Agent from time to time) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for
deposits in dollars (for delivery on the first day of such Interest Period) with a term equivalent to such
Interest Period. If such rate is not available at such time for any reason, then the LIBOR Rate for such
Interest Period, as applicable, shall be a rate per annum as may be agreed upon by the Borrower and the
Administrative Agent to be a rate at which deposits in dollars for delivery on the first day of such Interest
Period in same day funds in the approximate amount of the LIBOR Loan being made, continued or
converted by the Administrative Agent and with a term equivalent to such Interest Period, would be
offered by the Administrative Agents London Branch to major banks in the applicable London interbank
eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to
the commencement of such Interest Period. Notwithstanding anything to the contrary contained herein,
with respect to Term Loans and Delayed-Draw Term Loans, in no event shall the LIBOR Rate be less
than 0.75% per annum.

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Lien shall mean any mortgage, pledge, security interest, hypothecation, collateral
assignment, lien (statutory or other) or similar encumbrance (including any conditional sale or other title
retention agreement or any lease or license in the nature thereof); provided that in no event shall an
operating lease be deemed to be a Lien.
Liquidity shall mean the sum, as of any date of determination, of (i) Unrestricted Cash
plus (ii) the excess of (A) the Adjusted Total Revolving Credit Commitment over (B) the Revolving
Credit Exposure of all Lenders.
Loan shall mean any Revolving Credit Loan, Term Loan or Delayed-Draw Term Loan
made by any Lender hereunder.
Management Investors shall mean the directors, management, officers and employees
of the Ultimate Parent and its Subsidiaries who are or become investors (directly or indirectly) in
Holdings, any of its direct or indirect parent entities or in the Ultimate Parent at any time prior to the first
anniversary of Closing Date.
Master Agreement shall have the meaning provided in the definition of the term
Hedging Agreements.
Material Adverse Effect shall mean any circumstance or conditions affecting the
business, assets, operations, properties or financial condition of the Borrower and its Subsidiaries taken as
a whole, that would individually or in the aggregate, materially adversely affect the ability of the TCEH
Debtors (taken as a whole) to perform their payment obligations under the Credit Documents to which
they are a party, or the rights and remedies of the Administrative Agent, the Letter of Credit Issuers and
the Lenders under the Credit Documents other than, in each case, as a result of the events leading up to,
and following the commencement of a proceeding under Chapter 11 and the continuation and prosecution
thereof, including circumstances or conditions resulting from, or incidental to, such events,
commencement, continuation and prosecution, which shall not, individually or in the aggregate, constitute
a Material Adverse Effect, and provided that nothing disclosed in any of the following filings by the
Ultimate Parent and/or Parent Guarantor: (1) the annual report on Form 10-K for the year ended
December 31, 2013 (to the extent substantially the same in form and substance as the version provided to
the Left Lead Arrangers at least two days prior to the date of the Commitment Letter), (2) any filings on
Form 8-K made through the date of the Commitment Letter and/or (3) any disclosure statement related to
any plan of reorganization or liquidation of TCEH Debtors provided to the J oint Lead Arrangers on or
prior to the date of the Commitment Letter, shall, in any case, in and of itself and based solely on facts as
disclosed therein (without giving effect to any developments not disclosed therein) constitute a Material
Adverse Effect.
Material Subsidiary shall mean, at any date of determination, each Restricted
Subsidiary of the Borrower (a) whose total assets (when combined with the assets of such Restricted
Subsidiarys Subsidiaries, after eliminating intercompany obligations) at the last day of the most recent
Test Period for which Section 9.1 Financials have been delivered were equal to or greater than 2.5% of
the Consolidated Total Assets of the Borrower and the Restricted Subsidiaries at such date or (b) whose
total revenues (when combined with the revenues of such Restricted Subsidiarys Subsidiaries, after
eliminating intercompany obligations) during such Test Period were equal to or greater than 2.5% of the
consolidated revenues of the Borrower and the Restricted Subsidiaries for such period, in each case
determined in accordance with GAAP; provided that if, at any time and from time to time after the
Closing Date, Restricted Subsidiaries that are not Material Subsidiaries have, in the aggregate, (x) total
assets (when combined with the assets of such Restricted Subsidiarys Subsidiaries, after eliminating
intercompany obligations) at the last day of such Test Period equal to or greater than 10.0% of the

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Consolidated Total Assets of the Borrower and the Restricted Subsidiaries at such date or (y) total
revenues (when combined with the revenues of such Restricted Subsidiarys Subsidiaries, after
eliminating intercompany obligations) during such Test Period equal to or greater than 10.0% of the
consolidated revenues of the Borrower and the Restricted Subsidiaries for such period, in each case
determined in accordance with GAAP, then the Borrower shall, on the date on which financial statements
for such quarter are delivered pursuant to this Agreement, designate in writing to the Administrative
Agent one or more of such Restricted Subsidiaries as Material Subsidiaries so that such condition no
longer exists. It is agreed and understood that no Receivables Entity shall be a Material Subsidiary.
Maturity Date shall mean the earliest to occur of (a) _______, 2016;
2
provided,
however, that the Maturity Date shall be subject to a six-month extension as requested by the Borrower if
(1) as of the first day of such extension no Event of Default is continuing, (2) an Acceptable
Reorganization Plan has been filed, (3) a hearing has been scheduled for the confirmation of such
Acceptable Reorganization Plan, (4) the TCEH Debtors are working in good faith to confirm such
Acceptable Reorganization Plan, (5) an updated Budget and Annual Operating Forecast have been
delivered by the Borrower at least ten (10) days prior to the first day of such extension, which Budget and
Annual Operating Forecast demonstrate Liquidity sufficient to provide for Adequate Protection Payments
required by the Interim Cash Collateral Order, the Final Cash Collateral Order and the Orders through
such additional six-month period plus an additional $250,000,000, and (6) the Borrower pays an
extension fee in the amount of 0.25% of the then outstanding Commitments and Loans on the date of such
payment to the Administrative Agent for distribution to the Lenders on a pro rata basis based on the
respective Commitments and Loans held by each Lender (subclauses (1) through (6), the Extension
Conditions); (b) the effective date of any Reorganization Plan; (c) the date that is 45 days after the
Interim Order Entry Date if the Final Order Entry Date has not occurred by such date; (d) the
consummation of a sale of all or substantially all of the TCEH Debtors assets or stock under section 363
of the Bankruptcy Code; or (e) the acceleration of any Loans and the termination of any then outstanding
Commitments in accordance with the terms of this Agreement; provided, however, that the Maturity Date
will occur in any event no later than [______]
3
.
Minimum Borrowing Amount shall mean (a) with respect to any Borrowing of Loans
(other than Delayed-Draw Term Loans), $5,000,000, (b) with respect to a borrowing of Delayed-Draw
Term Loans, $250,000,000 (or, in each case, if less, the entire remaining Commitments of any applicable
Credit Facility at the time of such Borrowing).
Minority Investment shall mean any Person (other than a Subsidiary) in which the
Borrower or any Restricted Subsidiary owns Stock or Stock Equivalents, including any joint venture
(regardless of form of legal entity).
Moodys shall mean Moodys Investors Service, Inc. or any successor by merger or
consolidation to its business.
Mortgage shall mean a mortgage or a deed of trust, deed to secure debt, trust deed or
other security document entered into by the owner of a Mortgaged Property and the Collateral Agent for
the benefit of the Secured Parties in respect of that Mortgaged Property.

2
24 months from Closing Date.
3
30 months from Closing Date.

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Mortgaged Property shall mean all Real Estate, if any, with respect to which a Lien
for the benefit of the Collateral Agent and the other Secured Parties is granted and perfected pursuant to
the terms and conditions of any Order.
Multiemployer Plan shall mean a plan that is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA (i) to which any of the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate is then making or has an obligation to make contributions or (ii) with respect to which
the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate could incur liability pursuant to
Title IV of ERISA.
Narrative Report shall mean, with respect to the financial statements for which such
narrative report is required, a managements discussion and analysis of the financial condition and results
of operations of the Borrower and its consolidated Subsidiaries for the applicable period to which such
financial statements relate.
Necessary CapEx shall mean Capital Expenditures that are required by Applicable
Law (other than Environmental Law) or otherwise undertaken voluntarily for health and safety reasons
(other than as required by Environmental Law). The term Necessary CapEx does not include any
Capital Expenditure undertaken primarily to increase the efficiency of, expand or re-power any power
generation facility.
Net Cash Proceeds shall mean, with respect to any Prepayment Event, (a) the gross
cash proceeds (including payments from time to time in respect of installment obligations, if applicable)
received by or on behalf of the Borrower or any Restricted Subsidiary in respect of such Prepayment
Event, as the case may be, less (b) the sum of:
(i) the amount, if any, of all taxes paid or estimated by the Borrower in good faith to
be payable by the Borrower or any Restricted Subsidiary in connection with such Prepayment
Event,
(ii) the amount of any reasonable reserve established in accordance with GAAP
against any liabilities (other than any taxes deducted pursuant to clause (i) above) (x) associated
with the assets that are the subject of such Prepayment Event and (y) retained by the Borrower or
any Restricted Subsidiary (including any pension and other post-employment benefit liabilities
and liabilities related to environmental matters or against any indemnification obligations
associated with such transaction); provided that the amount of any subsequent reduction of such
reserve (other than in connection with a payment in respect of any such liability) shall be deemed
to be Net Cash Proceeds of such Prepayment Event occurring on the date of such reduction,
(iii) the amount of any Indebtedness (other than Indebtedness hereunder) secured by a
Lien on the assets that are the subject of such Prepayment Event to the extent that the instrument
creating or evidencing such Indebtedness requires that such Indebtedness be repaid upon
consummation of such Prepayment Event,
(iv) in the case of any Asset Sale Prepayment Event (other than any Asset Sale
Prepayment Event pursuant to Section 10.4(m)) or Recovery Prepayment Event, the amount of
any proceeds of such Prepayment Event that the Borrower or any Restricted Subsidiary has
reinvested (or intends to reinvest within the Reinvestment Period, has entered into an Acceptable
Reinvestment Commitment prior to the last day of the Reinvestment Period to reinvest or, with
respect to any Recovery Prepayment Event, provided an Acceptable Reinvestment Commitment
or a Restoration Certification prior to the last day of the Reinvestment Period) in the business of

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the Borrower or any Restricted Subsidiary (subject to Section 9.15), including for the repair,
restoration or replacement of an asset or assets subject to a Recovery Prepayment Event; provided
that any portion of such proceeds that has not been so reinvested within such Reinvestment
Period (with respect to such Prepayment Event, the Deferred Net Cash Proceeds) shall, unless
the Borrower or any Restricted Subsidiary has entered into an Acceptable Reinvestment
Commitment or provided a Restoration Certification prior to the last day of such Reinvestment
Period to reinvest such proceeds, (x) be deemed to be Net Cash Proceeds of an Asset Sale
Prepayment Event or Recovery Prepayment Event occurring on the last day of such Reinvestment
Period or, if later, 180 days after the date the Borrower or such Restricted Subsidiary has entered
into such Acceptable Reinvestment Commitment or provided such Restoration Certification, as
applicable (such last day or 180
th
day, as applicable, the Deferred Net Cash Proceeds Payment
Date), and (y) be applied to the repayment of Term Loans and Delayed-Draw Term Loans in
accordance with Section 5.2(a),
(v) in the case of any Asset Sale Prepayment Event with respect to Baseload Assets
pursuant to Section 10.4(m), the amount of any proceeds of such Asset Sale Prepayment Event
that the Borrower or any Restricted Subsidiary has reinvested (or intends to reinvest within the
Reinvestment Period or has entered into an Acceptable Reinvestment Commitment prior to the
last day of the Reinvestment Period to reinvest) in other Baseload Assets; provided that any
Deferred Net Cash Proceeds with respect to such Asset Sale Prepayment Event shall, unless the
Borrower or any Restricted Subsidiary has entered into an Acceptable Reinvestment Commitment
prior to the last day of such Reinvestment Period to reinvest such proceeds, (x) be deemed to be
Net Cash Proceeds of an Asset Sale Prepayment Event occurring on the Deferred Net Cash
Proceeds Payment Date and (y) be applied to the repayment of Term Loans and Delayed-Draw
Term Loans in accordance with Section 5.2(a),
(vi) in the case of any Asset Sale Prepayment Event or Recovery Prepayment Event
by a non-Wholly Owned Restricted Subsidiary, the pro rata portion of the Net Cash Proceeds
thereof (calculated without regard to this clause (vi)) attributable to minority interests and not
available for distribution to or for the account of the Borrower or a Wholly Owned Restricted
Subsidiary as a result thereof, and
(vii) reasonable and customary fees, commissions, expenses (including attorneys
fees, investment banking fees, survey costs, title insurance premiums and recording charges,
transfer taxes, deed or mortgage recording taxes and other customary expenses and brokerage,
consultant and other customary fees), issuance costs, discounts and other costs paid by the
Borrower or any Restricted Subsidiary, as applicable, in connection with such Prepayment Event,
in each case only to the extent not already deducted in arriving at the amount referred to in
clause (a) above.
Netting Agreement shall mean, in respect of Hedging Obligations, a netting
agreement, master netting agreement or other similar document having the same effect as a netting
agreement or master netting agreement and, as applicable, any collateral annex, security agreement or
other similar document related to any master netting agreement or Permitted Contract.
New Revolving Credit Commitments shall have the meaning provided in Section
2.14(i)(ii).
New Revolving Credit Loan shall have the meaning provided in Section 2.14(i)(ii).
New Revolving Credit Series shall have the meaning provided in Section 2.14(i)(ii).

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Non-Consenting Lender shall have the meaning provided in Section 13.7(b).
Non-Defaulting Lender shall mean and include each Lender other than a Defaulting
Lender.
Non-Extension Notice Date shall have the meaning provided in Section 3.2(b).
Non-U.S. Lender shall mean any Agent or Lender that is not, for United States federal
income tax purposes, (a) an individual who is a citizen or resident of the United States, (b) a corporation,
partnership or entity treated as a corporation or partnership created or organized in or under the laws of
the United States, or any political subdivision thereof, (c) an estate whose income is subject to U.S.
federal income taxation regardless of its source or (d) a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or more United States persons
have the authority to control all substantial decisions of such trust or a trust that has a valid election in
effect under applicable U.S. Treasury regulations to be treated as a United States person.
Notice of Borrowing shall mean a request of the Borrower in accordance with the
terms of Section 2.3 and substantially in the form of Exhibit A or such other form as shall be approved by
the Administrative Agent (acting reasonably).
Notice of Conversion or Continuation shall have the meaning provided in
Section 2.6(a).
Obligations shall mean all advances to, and debts, liabilities, obligations, covenants
and duties of, any Credit Party arising under any Credit Document or otherwise with respect to any Loan
or Letter of Credit or under any Secured Cash Management Agreement, Secured Commodity Hedging
Agreement or Secured Hedging Agreement, in each case, entered into with Parent Guarantor, the
Borrower or any Restricted Subsidiary, whether direct or indirect (including those acquired by
assumption), absolute or contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any Credit Party of any
proceeding under the Cases or any bankruptcy or insolvency law naming such Person as the debtor in
such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding, in
each case other than Excluded Swap Obligations. Without limiting the generality of the foregoing, the
Obligations of the Credit Parties under the Credit Documents (and any of their Restricted Subsidiaries to
the extent they have obligations under the Credit Documents) (i) include the obligation (including
guarantee obligations) to pay principal, interest, charges, expenses, fees, attorney costs, indemnities and
other amounts payable by any Credit Party under any Credit Document and (ii) exclude, notwithstanding
any term or condition in this Agreement or any other Credit Documents, any Excluded Swap Obligations.
Oncor shall mean Oncor Electric Delivery Company LLC, a Delaware limited liability
company.
Oncor Credit Facility shall mean the revolving credit agreement, dated as of October
10, 2007, among Oncor, the lenders from time to time party thereto, J PMorgan Chase Bank, N.A., as
administrative agent, Citibank, N.A., as syndication agent, and J .P. Morgan Securities Inc., Citigroup
Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs Credit Partners L.P., Lehman
Brothers Inc. and Morgan Stanley Senior Funding, Inc., as joint lead arrangers and bookrunners, as
amended, supplemented or otherwise modified from time to time.
Oncor Notes shall mean:

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Oncors 6.375% Senior Notes due 2015;
Oncors 5.000% Senior Secured Notes due 2017;
Oncors 7.000% Fixed Debentures due 2022;
Oncors 4.550% Senior Secured Notes due 2041; and
Oncors 5.300% Senior Secured Notes due 2042.
Oncor Subsidiaries shall mean Oncor Electric Delivery Holdings Company LLC and
its Subsidiaries.
Orders shall mean the Interim Order or the Final Order or both, as the context may
require.
Organizational Documents shall mean, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents
with respect to any non-U.S. jurisdiction), (b) with respect to any limited liability company, the certificate
or articles of formation or organization and operating agreement and (c) with respect to any partnership,
joint venture, trust or other form of business entity, the partnership, joint venture or other applicable
agreement of formation or organization and, if applicable, any agreement, instrument, filing or notice with
respect thereto filed in connection with its formation or organization with the applicable Governmental
Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles
of formation or organization of such entity.
Other Taxes shall mean any and all present or future stamp, registration, documentary
or any other excise, property or similar taxes (including interest, fines, penalties, additions to tax and
related expenses with regard thereto) arising from any payment made or required to be made under this
Agreement or any other Credit Document or from the execution or delivery of, registration or
enforcement of, consummation or administration of, or otherwise with respect to, this Agreement or any
other Credit Document.
Overnight Rate shall mean, for any day, the greater of (a) the Federal Funds Effective
Rate and (b) an overnight rate determined by the Administrative Agent, the General Letter of Credit

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Issuer or the RCT Letter of Credit Issuer, as the case may be, in accordance with banking industry rules
on interbank compensation.
Parent Guarantor shall have the meaning provided in the preamble to this
Agreement.
Participant shall have the meaning provided in Section 13.6(c)(i).
Participant Register shall have the meaning provided in Section 13.6(c)(iii).
Participating Receivables Grantor shall mean the Borrower or any Restricted
Subsidiary that is or that becomes a participant or originator in a Permitted Receivables Financing.
Patriot Act shall have the meaning provided in Section 13.18.
Payment Default shall mean any event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default under Section 11.1.
PBGC shall mean the Pension Benefit Guaranty Corporation established pursuant to
Section 4002 of ERISA, or any successor thereto.
Pension Act shall mean the Pension Protection Act of 2006, as it presently exists or as
it may be amended from time to time.
Perfection Certificate shall mean a certificate of the Borrower in a form approved by
the Administrative Agent.
Permitted Acquisition shall mean the acquisition, by merger or otherwise, by the
Borrower or any Restricted Subsidiary of assets (including assets constituting a business unit, line of
business or division) or Stock or Stock Equivalents, so long as (a) such acquisition and all transactions
related thereto shall be consummated in accordance with Applicable Law, (b) if such acquisition involves
any Stock or Stock Equivalents, such acquisition shall result in the issuer of such Stock or Stock
Equivalents and its Subsidiaries becoming a Restricted Subsidiary and a Subsidiary Guarantor, to the
extent required by Section 9.11, (c) such acquisition shall result in the Collateral Agent, for the benefit of
the applicable Secured Parties, being granted a security interest in any Stock, Stock Equivalent or any
assets so acquired, to the extent required by Sections 9.11, 9.12 and/or 9.14, (d) after giving effect to such
acquisition, the Borrower and the Restricted Subsidiaries shall be in compliance with Section 9.15,
(e) both before and after giving effect to such acquisition, no Default or Event of Default shall have
occurred and be continuing and (f) the Borrower shall be in compliance, on a Pro Forma Basis, after
giving effect to such acquisition (including any Indebtedness assumed or permitted to exist or incurred
pursuant to Section 10.1, and any related Pro Forma Adjustment), with the covenant set forth in
Section 10.9.
Permitted Contract shall have the meaning provided in Section 10.2(bb).
Permitted Holders shall mean (a) the Sponsors and (b) the Management Investors.

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Permitted Investments shall mean:
(a) securities issued or unconditionally guaranteed by the United States government
or any agency or instrumentality thereof, in each case having maturities and/or reset dates of not
more than 24 months from the date of acquisition thereof;
(b) securities issued by any state of the United States of America or any political
subdivision of any such state or any public instrumentality thereof or any political subdivision of
any such state or any public instrumentality thereof having maturities of not more than 24 months
from the date of acquisition thereof and, at the time of acquisition, having an investment grade
rating generally obtainable from either S&P or Moodys (or, if at any time neither S&P nor
Moodys shall be rating such obligations, then from another nationally recognized rating service);
(c) commercial paper or variable or fixed rate notes maturing no more than
12 months after the date of creation thereof and, at the time of acquisition, having a rating of at
least A-3 or P-3 from either S&P or Moodys (or, if at any time neither S&P nor Moodys shall
be rating such obligations, an equivalent rating from another nationally recognized rating
service);
(d) time deposits with, or domestic and LIBOR certificates of deposit or bankers
acceptances maturing no more than two years after the date of acquisition thereof issued by, any
Lender or any other bank having combined capital and surplus of not less than $500,000,000 in
the case of domestic banks and $100,000,000 (or the dollar equivalent thereof) in the case of
foreign banks;
(e) repurchase agreements with a term of not more than 90 days for underlying
securities of the type described in clauses (a), (b) and (d) above entered into with any bank
meeting the qualifications specified in clause (d) above or securities dealers of recognized
national standing;
(f) marketable short-term money market and similar funds (x) either having assets in
excess of $500,000,000 or (y) having a rating of at least A-3 or P-3 from either S&P or Moodys
(or, if at any time neither S&P nor Moodys shall be rating such obligations, an equivalent rating
from another nationally recognized rating service);
(g) shares of investment companies that are registered under the Investment
Company Act of 1940 and substantially all the investments of which are one or more of the types
of securities described in clauses (a) through (f) above; and
(h) in the case of Investments by any Restricted Foreign Subsidiary or Investments
made in a country outside the United States of America, other customarily utilized high-quality
Investments in the country where such Restricted Foreign Subsidiary is located or in which such
Investment is made.
Permitted Liens shall mean:
(a) Liens for taxes, assessments or governmental charges or claims not yet
delinquent or that are being contested in good faith and by appropriate proceedings for which
appropriate reserves have been established to the extent required by and in accordance with
GAAP;

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(b) Liens in respect of property or assets of the Borrower or any Subsidiary of the
Borrower imposed by Applicable Law, such as carriers, warehousemens and mechanics Liens
and other similar Liens, arising in the ordinary course of business or in connection with the
construction or restoration of facilities for the generation, transmission or distribution of
electricity, in each case so long as such Liens arise in the ordinary course of business and do not
individually or in the aggregate have a Material Adverse Effect;
(c) Liens arising from judgments or decrees in circumstances not constituting an
Event of Default under Section 11.11;
(d) Liens incurred or deposits made in connection with workers compensation,
unemployment insurance and other types of social security or similar legislation, or to secure the
performance of tenders, statutory obligations, trade contracts (other than for payment of money),
leases, statutory obligations, surety, stay, customs and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar obligations, in each case
incurred in the ordinary course of business (including in connection with the construction or
restoration of facilities for the generation, transmission or distribution of electricity) or otherwise
constituting Investments permitted by Section 10.5;
(e) ground leases or subleases, licenses or sublicenses in respect of real property on
which facilities owned or leased by the Borrower or any of the Subsidiaries of the Borrower are
located;
(f) easements, rights-of-way, licenses, reservations, servitudes, permits, conditions,
covenants, rights of others, restrictions (including zoning restrictions), oil, gas and other mineral
interests, royalty interests and leases, minor defects, exceptions or irregularities in title or survey,
encroachments, protrusions and other similar charges or encumbrances (including those to secure
health, safety and environmental obligations), which do not interfere in any material respect with
the business of the Borrower and the Subsidiaries of the Borrower, taken as a whole;
(g) any exception on the title policies issued in connection with any Mortgaged
Property;
(h) any interest or title of a lessor, sublessor, licensor, sublicensor or grantor of an
easement or secured by a lessors, sublessors, licensors, sublicensors interest or grantor of an
easement under any lease, sublease, license, sublicense or easement to be entered into by the
Borrower or any Restricted Subsidiary of the Borrower as lessee, sublessee, licensee, grantee or
sublicensee to the extent permitted by this Agreement;
(i) Liens in favor of customs and revenue authorities arising as a matter of law to
secure payment of customs duties in connection with the importation of goods;
(j) Liens on goods or inventory the purchase, shipment or storage price of which is
financed by a documentary letter of credit or bankers acceptance issued or created for the
account of the Borrower or any Subsidiary of the Borrower; provided that such Lien secures only
the obligations of the Borrower or such Subsidiary in respect of such letter of credit or bankers
acceptance to the extent permitted under Section 10.1;
(k) leases, licenses, subleases or sublicenses granted to others not interfering in any
material respect with the business of the Borrower and the Subsidiaries of the Borrower, taken as
a whole;

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(l) Liens arising from precautionary Uniform Commercial Code financing statement
or similar filings made in respect of operating leases entered into by the Borrower or any
Subsidiary of the Borrower;
(m) Liens created in the ordinary course of business in favor of banks and other
financial institutions over credit balances of any bank accounts of the Borrower and the
Subsidiaries held at such banks or financial institutions, as the case may be, to facilitate the
operation of cash pooling and/or interest set-off arrangements in respect of such bank accounts in
the ordinary course of business;
(n) Liens arising under Section 9.343 of the Texas Uniform Commercial Code or
similar statutes of states other than Texas;
(o) Liens on accounts receivable, other Receivables Facility Assets, or accounts into
which collections or proceeds of Receivables Facility Assets are deposited, in each case arising in
connection with a Permitted Receivables Financing;
(p) any zoning, land use, environmental or similar law or right reserved to or vested
in any Governmental Authority to control or regulate the use of any real property that does not
materially interfere with the ordinary conduct of the business of the Borrower and the
Subsidiaries of the Borrower, taken as a whole;
(q) any Lien arising by reason of deposits with or giving of any form of security to
any Governmental Authority for any purpose at any time as required by Applicable Law as a
condition to the transaction of any business or the exercise of any privilege or license, or to
enable the Borrower or any Subsidiary to maintain self-insurance or to participate in any fund for
liability on any insurance risks;
(r) Liens, restrictions, regulations, easements, exceptions or reservations of any
Governmental Authority applying to nuclear fuel;
(s) rights reserved to or vested in any Governmental Authority by the terms of any
right, power, franchise, grant, license or permit, or by any provision of Applicable Law, to
terminate or modify such right, power, franchise, grant, license or permit or to purchase or
recapture or to designate a purchaser of any of the property of such person;
(t) Liens arising under any obligations or duties affecting any of the property, the
Borrower or any Restricted Subsidiary to any Governmental Authority with respect to any
franchise, grant, license or permit which do not materially impair the use of such property for the
purposes for which it is held;
(u) rights reserved to or vested in any Governmental Authority to use, control or
regulate any property of such person, which do not materially impair the use of such property for
the purposes for which it is held;
(v) any obligations or duties, affecting the property of Parent Guarantor, the
Borrower or any Restricted Subsidiary, to any Governmental Authority with respect to any
franchise, grant, license or permit; and

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(w) a set-off or netting rights granted by Parent Guarantor, the Borrower or any
Subsidiary of the Borrower pursuant to any Hedging Agreements, Netting Agreements or
Permitted Contracts solely in respect of amounts owing under such agreements.
Notwithstanding anything to the contrary, Permitted Liens shall not include Liens securing any of the
Prepetition Debt.
Permitted Property Interest shall have the meaning provided in Section 14.3.
Permitted Receivables Financing shall mean any of one or more receivables
financing programs as amended, supplemented, modified, extended, renewed, restated or refunded from
time to time, the obligations of which are non-recourse (except for customary representations, warranties,
covenants and indemnities and other customary forms of support, in each case made in connection with
such facilities) to the Borrower and the Restricted Subsidiaries (other than a Receivables Entity)
providing for the sale, conveyance, or contribution to capital of Receivables Facility Assets by
Participating Receivables Grantors in transactions purporting to be sales of Receivables Facility Assets to
either (a) a Person that is not a Restricted Subsidiary or (b) a Receivables Entity that in turn funds such
purchase by the direct or indirect sale, transfer, conveyance, pledge, or grant of participation or other
interest in such Receivables Facility Assets to a Person that is not a Restricted Subsidiary.
Permitted Sale Leaseback shall mean any Sale Leaseback existing on the Closing
Date or consummated by the Borrower or any Restricted Subsidiary after the Closing Date; provided that
any such Sale Leaseback consummated after the Closing Date not between (a) a Credit Party and another
Credit Party or (b) a Restricted Subsidiary that is not a Credit Party and another Restricted Subsidiary that
is not a Credit Party is consummated for fair value as determined at the time of consummation in good
faith by (i) the Borrower or such Restricted Subsidiary and (ii) in the case of any Sale Leaseback (or
series of related Sale Leasebacks) the aggregate proceeds of which exceed $100,000,000, the board of
directors of the Borrower or such Restricted Subsidiary (which such determination may take into account
any retained interest or other Investment of the Borrower or such Restricted Subsidiary in connection
with, and any other material economic terms of, such Sale Leaseback). Notwithstanding anything to the
contrary contained in this Agreement, the term Permitted Sale Leaseback shall not in any event include
any direct or indirect Sale Leaseback of all or any portion of one or more Baseload Generation Assets.
Person shall mean any individual, partnership, joint venture, firm, corporation, limited
liability company, association, trust or other enterprise or any Governmental Authority.
Petition Date shall have the meaning set forth in the Recitals hereto.
Plan shall mean an employee pension benefit plan (other than a Multiemployer Plan) -
which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of
the Code or Section 302 of ERISA and is maintained or contributed to by the Borrower, any Subsidiary or
ERISA Affiliate or with respect to which the Borrower or any Subsidiary could incur liability pursuant to
Title IV of ERISA.
Plan Effective Date shall mean the date of the effectiveness of an Acceptable
Reorganization Plan that has been confirmed pursuant to a final order of the Bankruptcy Court.
Platform shall have the meaning provided in Section 13.17(c).
Pledge Agreement shall mean any pledge agreement with respect to any or all of the
Obligations delivered pursuant to Section 9.12.

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Post-Acquisition Period shall mean, with respect to any Specified Transaction, the
period beginning on the date such Specified Transaction is consummated and ending on the last day of the
sixth full consecutive fiscal quarter immediately following the date on which such Specified Transaction
is consummated.
Preferred Stock shall mean any Stock or Stock Equivalents with preferential rights of
payment of dividends or upon liquidation, dissolution or winding up.
Prepayment Event shall mean any Asset Sale Prepayment Event or Recovery
Prepayment Event.
Prepetition shall mean, when used with respect to any agreement or instrument or any
claim or proceeding or any other matter with respect of any Credit Party, an agreement or instrument that
was entered into or became effective, a claim or proceeding that first arose or was first instituted, or
another matter that first occurred or, by operation of law, is deemed to have occurred, prior to the Petition
Date.
Prepetition Credit Agreement shall mean that certain Credit Agreement, dated as of
October 10, 2007, by and among Texas Competitive Electric Holdings Company LLC, as borrower,
Energy Future Competitive Holdings Company, LLC, the guarantors party thereto, the lenders party
thereto and Citibank, N.A., as administrative agent, collateral agent, swingline lender and an issuing bank,
as amended, supplemented or otherwise modified from time to time.
Prepetition Credit Agreement Lender shall mean each Lender (under and as
defined in the Prepetition Credit Agreement) from time to time party to the Prepetition Credit Agreement.
Prepetition Debt shall mean collectively all Prepetition First Lien Obligations and
Prepetition Second Lien Obligations.
Prepetition First Lien Intercreditor Agreement shall mean that certain Amended
and Restated Collateral Agency and Intercreditor Agreement, dated as of October 10, 2007 and amended
and restated as of August 7, 2009, among Energy Future Competitive Holdings Company LLC, Texas
Competitive Electric Holdings Company LLC, the subsidiary guarantors party thereto, Citibank, N.A., as
Administrative Agent and Collateral Agent, Credit Suisse Energy LLC, J . Aron & Company, Morgan
Stanley Capital Group Inc., Citigroup Energy Inc., and the other parties from time to time party thereto, as
amended, restated, supplemented or modified from time to time to the extent permitted by this Agreement
Prepetition First Lien Obligations shall mean the Secured Obligations (as defined
in the Prepetition First Lien Intercreditor Agreement).
Prepetition First Lien Secured Parties shall mean the Secured Parties (as defined
in the Prepetition First Lien Intercreditor Agreement).
Prepetition Second Lien Documents shall mean the Prepetition Second Lien
Indenture, the other Collateral Documents (as defined in the Prepetition Second Lien Indenture),
including each collateral trust agreement, mortgage and other security documents and any guarantee
entered into in connection therewith and any related notes, the Prepetition Second Lien Notes, and the
other Collateral Documents (as defined in the Prepetition Second Lien Indenture), including the
Prepetition Second Lien Intercreditor Agreement and each mortgage and other security documents and
any guarantee entered into in connection therewith and any related notes.

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Prepetition Second Lien Indenture shall mean that certain indenture, dated as of
October 6, 2010, among the Borrower, TCEH Finance, Inc., the guarantors party thereto and The Bank of
New York Mellon Trust Company, as trustee, The Bank of New York Mellon Trust Company, as
collateral agent for the Prepetition Second Lien Secured Parties, as amended, restated, supplemented or
modified from time to time to the extent permitted by this Agreement.
Prepetition Second Lien Intercreditor Agreement shall mean that certain Second
Lien Intercreditor Agreement, dated as of October 6, 2010, among Energy Future Competitive Holdings
Company, Texas Competitive Electric Holdings Company LLC, the subsidiary guarantors party thereto,
Citibank, N.A., as senior collateral agent for the senior secured parties and as representative for the credit
agreement secured parties, The Bank of New York Mellon Trust Company, as the initial second priority
representative, and the other parties from time to time party thereto, as amended, restated, supplemented
or modified from time to time to the extent permitted by this Agreement.
Prepetition Second Lien Notes shall mean (i) the 15% senior secured second lien
notes due April 1, 2021 and (ii) the 15% senior secured second lien notes due April 1, 2021, Series B
issued by Borrower and TCEH Finance, Inc. under the Prepetition Second Lien Indenture and any notes
issued in connection therewith (or increases thereto) resulting from payment of interest in kind and any
notes issued in exchange therefor having the same economic terms, including guarantees thereof by the
guarantors thereof.
Prepetition Second Lien Obligations shall mean the Second Priority Debt
Obligations as defined in the Prepetition Second Lien Intercreditor Agreement.
Prepetition Second Lien Secured Parties shall mean The Bank of New York Mellon
Trust Company, in its capacities as Trustee under the Prepetition Second Lien Indenture and as collateral
agent under the Prepetition Second Lien Documents, its successors and assigns in such capacities and
each person that is a holder of Prepetition Second Lien Notes.
Pro Forma Adjustment shall mean, for any Test Period that includes all or any part of
a fiscal quarter included in any Post-Acquisition Period, with respect to the Acquired EBITDA of the
applicable Pro Forma Entity or the Consolidated EBITDA of the Borrower, the pro forma increase or
decrease in such Acquired EBITDA or such Consolidated EBITDA, as the case may be, projected by the
Borrower in good faith as a result of (a) actions taken or to be taken, prior to or during such Post-
Acquisition Period for the purposes of realizing reasonably identifiable and factually supportable cost
savings or (b) any additional costs incurred prior to or during such Post-Acquisition Period, in each case
in connection with the combination of the operations of such Pro Forma Entity with the operations of the
Borrower and the Restricted Subsidiaries; provided that (A) at the election of the Borrower, such Pro
Forma Adjustment shall not be required to be determined for any Pro Forma Entity to the extent the
aggregate consideration paid in connection with such acquisition was less than $50,000,000 and (ii) so
long as such actions are taken, or to be taken, prior to or during such Post-Acquisition Period or such
costs are incurred prior to or during such Post-Acquisition Period, as applicable, it may be assumed, for
purposes of projecting such pro forma increase or decrease to such Acquired EBITDA or such
Consolidated EBITDA, as the case may be, that the applicable amount of such cost savings will be
realizable during the entirety of such Test Period, or the applicable amount of such additional costs, as
applicable, will be incurred during the entirety of such Test Period; provided, further that any such
pro forma increase or decrease to such Acquired EBITDA or such Consolidated EBITDA, as the case
may be, shall be without duplication for cost savings or additional costs already included in such
Acquired EBITDA or such Consolidated EBITDA, as the case may be, for such Test Period.

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Pro Forma Adjustment Certificate shall mean any certificate of an Authorized
Officer of the Borrower delivered pursuant to Section 9.1(h) or setting forth the information described in
clause (iii) to Section 9.1(c).
Pro Forma Basis, Pro Forma Compliance and Pro Forma Effect shall mean,
with respect to compliance with any test or covenant hereunder, that (A) to the extent applicable, the Pro
Forma Adjustment shall have been made and (B) all Specified Transactions and the following
transactions in connection therewith shall be deemed to have occurred as of the first day of the applicable
period of measurement in such test or covenant: (a) income statement items (whether positive or
negative) attributable to the property or Person subject to such Specified Transaction, (i) in the case of a
Disposition of all or substantially all Stock in any Subsidiary of the Borrower or any division, product
line, or facility used for operations of the Borrower or any Subsidiary of the Borrower, shall be excluded,
and (ii) in the case of a Permitted Acquisition or Investment described in the definition of Specified
Transaction, shall be included, (b) any retirement or repayment of Indebtedness, and (c) any incurrence
or assumption of Indebtedness by the Borrower or any Restricted Subsidiary in connection therewith (it
being agreed that if such Indebtedness has a floating or formula rate, such Indebtedness shall have an
implied rate of interest for the applicable period for purposes of this definition determined by utilizing the
rate that is or would be in effect with respect to such Indebtedness as at the relevant date of
determination); provided that, without limiting the application of the Pro Forma Adjustment pursuant to
(A) above (but without duplication thereof), the foregoing pro forma adjustments may be applied to any
such test or covenant solely to the extent that such adjustments are consistent with the definition of
Consolidated EBITDA and give effect to events (including operating expense reductions) that are (i) (x)
directly attributable to such transaction, (y) expected to have a continuing impact on the Borrower and the
Restricted Subsidiaries and (z) factually supportable or (ii) otherwise consistent with the definition of Pro
Forma Adjustment.
Pro Forma Entity shall have the meaning provided in the definition of the term
Acquired EBITDA.
PUCT shall mean the Public Utility Commission of Texas or any successor.
Qualified ECP Guarantor shall mean, in respect of any Swap Obligation, each
Guarantor that has total assets exceeding $10,000,000 at the time the relevant Guarantee or grant of the
relevant security interest becomes effective with respect to such Swap Obligation or such other person as
constitutes an eligible contract participant under the Commodity Exchange Act or any regulations
promulgated thereunder and can cause another person to qualify as an eligible contract participant at
such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
Qualifying IPO shall mean the issuance by the Ultimate Parent, Parent Guarantor or
any other direct or indirect parent of Parent Guarantor of its common Stock in an underwritten primary
public offering (other than a public offering pursuant to a registration statement on Form S-8) pursuant to
an effective registration statement filed with the SEC in accordance with the Securities Act (whether
alone or in connection with a secondary public offering).
RCT shall mean the Railroad Commission of Texas.
RCT Carve Out Support Rejection Notice shall have the meaning provided in
Section 4.4.
RCT L/C Cash Coverage Requirement shall have the meaning provided in Section
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RCT L/C Collateral Account shall mean one or more Cash Collateral Accounts or
securities accounts established pursuant to, and subject to the terms of, Section 3.9 for the purpose of cash
collateralizing the RCT L/C Obligations in respect of RCT Letters of Credit.
RCT L/C Collateral Account Balance shall mean, at any time, with respect to any
RCT L/C Collateral Account, the aggregate amount on deposit in such RCT L/C Collateral Account.
References herein and in the other Credit Documents to the RCT L/C Collateral Account Balance shall be
deemed to refer to the RCT L/C Collateral Account Balance in respect of the applicable RCT L/C
Collateral Account or to the RCT L/C Collateral Account Balance in respect of all RCT L/C Collateral
Accounts, as the context requires.
RCT L/C Collateral Account Depositary Bank shall have the meaning provided in
Section 3.9.
RCT L/C Obligations shall mean, as at any date of determination and, without
duplication, the aggregate Stated Amount of all outstanding RCT Letters of Credit plus the aggregate
principal amount of all Unpaid Drawings under all RCT Letters of Credit. For all purposes of this
Agreement, if on any date of determination a RCT Letter of Credit has expired by its terms but any
amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such RCT Letter
of Credit shall be deemed to be outstanding in the amount so remaining available to be drawn.
RCT L/C Permitted Investments shall mean:
(a) any Permitted Investments described in clauses (a) through (g) of the definition
thereof; and
(b) such other securities as agreed to by the TCEH Debtors with the applicable RCT
Letter of Credit Issuer from time to time.
RCT L/C Termination Date shall mean the Maturity Date.
RCT Letter of Credit shall have the meaning provided in Section 3.1(b)(i).
RCT Letter of Credit Commitment shall mean $1,100,000,000 (as such amount may
be reduced pursuant to Section 4.2(c) or Section 4.4).
RCT Letter of Credit Issuers shall mean (a) on the date hereof, (i) Citibank, N.A., (ii)
Deutsche Bank AG New York Branch, (iii) Bank of America, N.A., (iv) Morgan Stanley Senior Funding,
Inc., (v) Barclays Bank PLC, (vi) Royal Bank of Canada and (vii) Union Bank, N.A. and (b) at any time
such Person who shall become an RCT Letter of Credit Issuer pursuant to Section 3.6 (it being
understood that if any such Person ceases to be a Lender hereunder, such Person will remain an RCT
Letter of Credit Issuer with respect to any RCT Letters of Credit issued by such Person that remained
outstanding as of the date such Person ceased to be a Lender). Any RCT Letter of Credit Issuer may, in
its discretion, arrange for one or more RCT Letters of Credit to be issued by Affiliates of such RCT Letter
of Credit Issuer, and in each such case the term RCT Letter of Credit Issuer shall include any such
Affiliate with respect to RCT Letters of Credit issued by such Affiliate. References herein and in the
other Credit Documents to the RCT Letter of Credit Issuer shall be deemed to refer to the RCT Letter of
Credit Issuer in respect of the applicable RCT Letter of Credit or to all RCT Letter of Credit Issuers, as
the context requires.

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RCT Letter of Credit Reimbursement Obligations shall mean the obligations of the
TCEH Debtors to reimburse and repay Unpaid Drawings on any RCT Letter of Credit pursuant to the
terms and conditions set forth in Section 3.4 of this Agreement.
RCT Letters of Credit Outstanding shall mean, at any time, with respect to any RCT
Letter of Credit Issuer, the sum of, without duplication, (a) the aggregate Stated Amount of all
outstanding RCT Letters of Credit issued by such RCT Letter of Credit Issuer and (b) the aggregate
principal amount of all Unpaid Drawings in respect of all such RCT Letters of Credit. References herein
and in the other Credit Documents to the RCT Letters of Credit Outstanding shall be deemed to refer to
the RCT Letters of Credit Outstanding in respect of all RCT Letters of Credit issued by the applicable
RCT Letter of Credit Issuer or to the RCT Letters of Credit Outstanding in respect of all RCT Letters of
Credit, as the context requires.
RCT Reclamation Support Carve Out shall mean (unless and until the Borrower
issues and delivers the RCT Carve Out Support Rejection Notice pursuant to Section 4.4 hereof) all
amounts up to $1,100,000,000 required to be paid by the TCEH Debtors to the RCT pursuant to amounts
due and owing in respect of reclamation obligations incurred by the RCT and for which any of the TCEH
Debtors may be liable under Applicable Law.
Real Estate shall have the meaning provided in Section 9.1(f).
Receivables Entity shall mean any Person formed solely for the purpose of
(i) facilitating or entering into one or more Permitted Receivables Financings, and (ii) in each case,
engaging in activities reasonably related or incidental thereto. TXU Receivables Company, a Delaware
corporation and TXU Energy Receivables Company LLC, a Delaware corporation, shall each be deemed
to be a Receivables Entity.
Receivables Facility Assets shall mean currently existing and hereafter arising or
originated Accounts, Payment Intangibles and Chattel Paper (as each such term is defined in the UCC)
owed or payable to any Participating Receivables Grantor, and to the extent related to or supporting any
Accounts, Chattel Paper or Payment Intangibles, or constituting a receivable, all General Intangibles (as
each such term is defined in the UCC) and other forms of obligations and receivables owed or payable to
any Participating Receivables Grantor, including the right to payment of any interest, finance charges, late
payment fees or other charges with respect thereto (the foregoing, collectively, being receivables), all
of such Participating Receivables Grantors rights as an unpaid vendor (including rights in any goods the
sale of which gave rise to any receivables), all security interests or liens and property subject to such
security interests or liens from time to time purporting to secure payment of any receivables or other
items described in this definition, all guarantees, letters of credit, security agreements, insurance and other
agreements or arrangements from time to time supporting or securing payment of any receivables or other
items described in this definition, all customer deposits with respect thereto, all rights under any contracts
giving rise to or evidencing any receivables or other items described in this definition, and all documents,
books, records and information (including computer programs, tapes, disks, data processing software and
related property and rights) relating to any receivables or other items described in this definition or to any
obligor with respect thereto, and all proceeds of the foregoing.
Receivables Fees shall mean distributions or payments made directly or by means of
discounts with respect to any accounts receivable or participation interest therein issued or sold in
connection with, and other fees paid to a Person that is not a Restricted Subsidiary in connection with any
Permitted Receivables Financing.

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Recovery Event shall mean (a) any damage to, destruction of or other casualty or loss
involving any property or asset or (b) any seizure, condemnation, confiscation or taking (or transfer under
threat of condemnation) under the power of eminent domain of, or any requisition of title or use of or
relating to, or any similar event in respect of, any property or asset.
Recovery Prepayment Event shall mean the receipt of cash proceeds with respect to
any settlement or payment in connection with any Recovery Event in respect of any property or asset of
the Borrower or any Restricted Subsidiary; provided that the term Recovery Prepayment Event shall not
include any Asset Sale Prepayment Event.
Register shall have the meaning provided in Section 13.6(b)(iv).
Regulation T shall mean Regulation T of the Board as from time to time in effect and
any successor to all or a portion thereof establishing margin requirements.
Regulation U shall mean Regulation U of the Board as from time to time in effect and
Regulation X shall mean Regulation X of the Board as from time to time in effect and
Reimbursement Date shall have the meaning provided in Section 3.4(a).
Reinvestment Period shall mean 15 months following the date of receipt of Net Cash
Proceeds of an Asset Sale Prepayment Event or Recovery Prepayment Event.
Related Parties shall mean, with respect to any specified Person, such Persons
Affiliates and the directors, officers, employees, agents, trustees and advisors of such Person and any
Person that possesses, directly or indirectly, the power to direct or cause the direction of the management
or policies of such Person, whether through the ability to exercise voting power, by contract or otherwise.
Reorganization Plan shall mean a plan of reorganization of the TCEH Debtors in the
Cases.
Reportable Event shall mean an event described in Section 4043 of ERISA and the
regulations thereunder, other than any event as to which the thirty day notice period has been waived.
Required Delayed-Draw Term Loan Lenders shall mean, at any date, Non-Defaulting
Lenders having or holding a majority of the sum of (a) the aggregate outstanding principal amount of the
Delayed-Draw Term Loans (excluding Delayed Draw Term Loans held by Defaulting Lenders) at such
date and (b) the Adjusted Available Delayed Draw Term Loan Commitment at such date.
Required Lenders shall mean, at any date, Non-Defaulting Lenders having or holding
a majority of the sum of (a) the outstanding amount of the Term Loans in the aggregate at such date, (b)
the sum of (i) the aggregate outstanding principal amount of the Delayed-Draw Term Loans (excluding
Delayed-Draw Term Loans held by Defaulting Lenders) at such date and (ii) the Adjusted Available
Delayed-Draw Term Loan Commitment at such date and (c) (i) the Adjusted Total Revolving Credit
Commitment at such date or (ii) if the Total Revolving Credit Commitment has been terminated or for the
purposes of acceleration pursuant to Section 11, the outstanding principal amount of the Revolving Credit
Loans (excluding the Revolving Credit Loans of Defaulting Lenders) in the aggregate at such date.

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Required Revolving Credit Lenders shall mean, at any date, (i) Non-Defaulting
Lenders holding a majority of the Adjusted Total Revolving Credit Commitment at such date or (ii) if the
Total Revolving Credit Commitment has been terminated or for the purposes of acceleration pursuant to
Section 11, the outstanding principal amount of the Revolving Credit Loans (excluding Revolving Credit
Loans of Defaulting Lenders) in the aggregate at such date.
Required Term Loan Lenders shall mean, at any date, Lenders having or holding a
majority of the aggregate outstanding principal amount of the Term Loans at such date.
Restoration Certification shall mean, with respect to any Recovery Prepayment
Event, a certification made by an Authorized Officer of the Borrower or any Restricted Subsidiary, as
applicable, to the Administrative Agent prior to the end of the Reinvestment Period certifying (a) that the
Borrower or such Restricted Subsidiary intends to use the proceeds received in connection with such
Recovery Prepayment Event to repair, restore or replace the property or assets in respect of which such
Recovery Prepayment Event occurred, (b) the approximate costs of completion of such repair, restoration
or replacement and (c) that such repair, restoration or replacement will be completed within the later of
(x) fifteen months after the date on which cash proceeds with respect to such Recovery Prepayment Event
were received and (y) 180 days after delivery of such Restoration Certification.
Restricted Foreign Subsidiary shall mean a Foreign Subsidiary that is a Restricted
Subsidiary.
Restricted Subsidiary shall mean any Subsidiary of the Borrower other than an
Unrestricted Subsidiary.
Restructuring Support Agreement shall mean that certain Restructuring Support
Agreement dated [_____], 2014 by and among the Credit Parties, [_____], the Prepetition Credit
Agreement Lenders party thereto the [Prepetition Noteholders] party thereto and the holders of
Prepetition Second Lien Notes party thereto, as amended and restated, supplemented or otherwise
modified in accordance with the terms thereof.
Restructuring Term Sheet shall mean the Restructuring Term Sheet attached as
Exhibit [__] to the Restructuring Support Agreement, as amended, amended and restated, supplemented
or otherwise modified in accordance with the terms thereof.
Revolving Credit Commitment shall mean, (a) in the case of each Lender that is a
Lender on the date hereof, the amount set forth opposite such Lenders name on Schedule 1.1(a) as such
Lenders Revolving Credit Commitment and (b) in the case of any Lender that becomes a Lender after
the date hereof, the amount specified as such Lenders Revolving Credit Commitment in the
Assignment and Acceptance pursuant to which such Lender assumed a portion of the Total Revolving
Credit Commitment, in each case as the same may be changed from time to time pursuant to the terms
hereof. Subject to Section 2.1(c), the aggregate amount of Revolving Credit Commitments outstanding as
of the Closing Date is $1,950,000,000. Unless the context shall otherwise require, the term Revolving
Credit Commitment shall include any New Revolving Credit Commitment.
Revolving Credit Commitment Fee shall have the meaning provided in Section
4.1(a).
Revolving Credit Commitment Fee Rate shall mean, (x) at any time the Revolving
Credit Facilities are rated at least Ba3 by Moodys and BB- by S&P, 0.375% per annum or (y) at any
other time, 0.50% per annum.

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Revolving Credit Commitment Percentage shall mean at any time, for each Lender,
the percentage obtained by dividing (a) such Lenders Revolving Credit Commitment at such time by
(b) the amount of the Total Revolving Credit Commitment at such time; provided that at any time when
the Total Revolving Credit Commitment shall have been terminated, each Lenders Revolving Credit
Commitment Percentage shall be the percentage obtained by dividing (a) such Lenders Revolving Credit
Exposure at such time by (b) the Revolving Credit Exposure of all Lenders at such time.
Revolving Credit Exposure shall mean, with respect to any Lender at any time, the
aggregate principal amount of the Revolving Credit Loans of such Lender then-outstanding at such time.
Revolving Credit Facility shall mean the revolving credit facility represented by the
Revolving Credit Commitments.
Revolving Credit Lender shall mean, at any time, any Lender that has a Revolving
Credit Commitment at such time.
Revolving Credit Loans shall have the meaning provided in Section 2.1(c). Unless
the context shall otherwise require, the term Revolving Credit Loans shall include any New Revolving
Credit Loans.
Revolving Credit Termination Date shall mean the Maturity Date.
S&P shall mean Standard & Poors Ratings Services or any successor by merger or
consolidation to its business.
Sale Leaseback shall mean any transaction or series of related transactions pursuant to
which the Borrower or any Restricted Subsidiary (a) sells, transfers or otherwise disposes of any property,
real or personal, whether now owned or hereafter acquired, and (b) as part of such transaction, thereafter
rents or leases such property or other property that it intends to use for substantially the same purpose or
purposes as the property being sold, transferred or disposed.
Sandow Unit 4 shall mean the approximately 557 megawatt (net load) lignite fired
power generation facility, excluding mining properties, known as Sandow Unit 4 being operated and
owned by Luminant Generation Company LLC in Milam County, Texas.
Sanctions shall have the meaning provided in Section 8.20.
Sanctions Laws shall have the meaning provided in Section 8.20.
SEC shall mean the Securities and Exchange Commission or any successor thereto.
Section 9.1 Financials shall mean the financial statements delivered, or required to be
delivered, pursuant to Section 9.1(a) or (b) together with the accompanying officers certificate delivered,
or required to be delivered, pursuant to Section 9.1(c).
Secured Cash Management Agreement shall mean any agreement relating to Cash
Management Services that is entered into by and between the Borrower or any Restricted Subsidiary and
any Cash Management Bank.
Secured Commodity Hedging Agreement shall mean (a) any Commodity Hedging
Agreement that (i) is entered into by and between the Borrower or any Restricted Subsidiary and any

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Hedge Bank and (ii) individually or together with other Commodity Hedging Agreements (other than
Commodity Hedging Agreements that are unsecured) entered into or being entered into with such Hedge
Bank or its affiliates, is structured such that, at the time it is first entered into, the net mark-to-market
credit exposure calculated as of the date of entry into such Commodity Hedging Agreement of (x) the
counterparties to such Commodity Hedging Agreements (taken as a whole) to (y) the Borrower or any
other TCEH Debtor, is positively correlated with the price of the relevant commodity or positively
correlated with changes in the relevant spark spread and (b) any other Commodity Hedging Agreement
that (i) is entered into by and between the Borrower or any Restricted Subsidiary and any Hedge Bank
and (ii) is entered into to unwind or offset any existing Secured Commodity Hedging Agreement of the
type described in clause (a) above; provided that any Commodity Hedging Agreement entered into prior
to the Petition Date shall not constitute a Secured Commodity Hedging Agreement unless (x) as of the
Petition Date, the Swap Termination Value in respect of such Commodity Hedging Agreement would be
payable to the Borrower or the Restricted Subsidiary party to such Commodity Hedging Agreement if
such Commodity Hedging Agreement were terminated as of the Petition Date and (y) such Commodity
Hedging Agreement has not been terminated as of the Petition Date and the counterparty thereto has
waived its right to terminate such Commodity Hedging Agreement.
Secured Hedging Agreement shall mean any Hedging Agreement that is entered into
by and between the Borrower or any Restricted Subsidiary and any Hedge Bank.
Secured Parties shall mean the Administrative Agent, the Collateral Agent, the Letter
of Credit Issuers, each Lender, each Hedge Bank that is party to any Secured Hedging Agreement or a
Secured Commodity Hedging Agreement, as applicable, each Cash Management Bank that is a party to a
Secured Cash Management Agreement and each sub-agent pursuant to Section 12 appointed by the
Administrative Agent with respect to matters relating to the Credit Facilities or by the Collateral Agent
with respect to matters relating to any Security Document.
Securities Act shall mean the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
Securitization shall mean a public or private offering by a Lender or any of its
Affiliates or their respective successors and assigns of securities or notes which represent an interest in, or
which are collateralized, in whole or in part, by the Loans and the Lenders rights under the Credit
Documents.
Security Agreement shall mean the Security Agreement entered into by the Borrower,
the other grantors party thereto and the Collateral Agent for the benefit of the Secured Parties,
substantially in the form of Exhibit F.
Security Documents shall mean, collectively, (a) the Security Agreement, (b) any
Pledge Agreement, (c) the Orders, (d) Section 14 of this Agreement and (e) each other security agreement
or other instrument or document executed and delivered pursuant to Section 9.11, 9.12 or 9.14 or pursuant
to any other such Security Documents to secure or perfect the security interest in any or all of the
Obligations. The Security Documents (other than the Orders) shall supplement, and shall not limit, the
grant of a Lien on and security interest in the Collateral pursuant to the Orders.
Shared Services Agreement shall mean the Shared Services Agreement, dated on or
about October 23, 2013 between EFH Corporate Services Company and the Borrower, as amended,
supplemented or otherwise modified from time to time in a manner that is not, in the Borrowers
reasonable judgment, adverse, taken as a whole, to the Lenders in any material respect.

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Sold Entity or Business shall have the meaning provided in the definition of the term
Consolidated EBITDA.
Specified Affiliates shall mean, collectively, the following affiliates of the Borrower:
(i) Comanche Peak Nuclear Power Company LLC; (ii) EFH Corporate Services Company; (iii) EFH
Properties Company; (iv) the Ultimate Parent;and (v) the Oncor Subsidiaries.
Specified Default shall mean any Event of Default under Section 11.1.
Specified RCT Letter of Credit Commitment shall mean, with respect to any RCT
Letter of Credit Issuer, (a) in the case of each RCT Letter of Credit Issuer that is a RCT Letter of Credit
Issuer on the date hereof, the percentage of the RCT Letter of Credit Commitment set forth opposite such
RCT Letter of Credit Issuers name on Schedule 1.1(a) as such RCT Letter of Credit Issuers Specified
RCT Letter of Credit Commitment or such other percentage as the Borrower and such RCT Letter of
Credit Issuer may agree in writing from time to time and (b) in the case of any other RCT Letter of Credit
Issuer, 100% of the RCT Letter of Credit Commitment or such lower percentage as is specified in the
agreement pursuant to which such Person becomes a RCT Letter of Credit Issuer entered into pursuant to
Section 3.6(a) hereof.
Specified General Letter of Credit Commitment . shall mean, with respect to any
General Letter of Credit Issuer, (a) in the case of each General Letter of Credit Issuer that is a General
Letter of Credit Issuer on the date hereof, the percentage of the General Letter of Credit Commitment set
forth opposite such General Letter of Credit Issuers name on Schedule 1.1(a) as such General Letter of
Credit Issuers Specified General Letter of Credit Commitment or such other percentage as the
Borrower and such General Letter of Credit Issuer may agree in writing from time to time and (b) in the
case of any other General Letter of Credit Issuer, 100% of the General Letter of Credit Commitment or
such lower percentage as is specified in the agreement pursuant to which such Person becomes a General
Letter of Credit Issuer entered into pursuant to Section 3.6(a) hereof.
Specified Transaction shall mean, with respect to any period, any Investment, any
Disposition of assets, Permitted Sale Leaseback, incurrence or repayment of Indebtedness, dividend,
Subsidiary designation, Incremental Term Loan, Incremental Revolving Commitment Increase or other
event that by the terms of this Agreement requires Pro Forma Compliance with a test or covenant
hereunder or requires such test or covenant to be calculated on a Pro Forma Basis.
Sponsors shall mean any of Kohlberg Kravis Roberts & Co., L.P., KKR Associates,
L.P., TPG Capital, L.P. and Goldman, Sachs & Co., and each of their respective Affiliates, but excluding
portfolio companies of any of the foregoing.
SPV shall have the meaning provided in Section 13.6(g).
Stated Amount of any Letter of Credit shall mean the maximum amount from time to
time available to be drawn thereunder, determined without regard to whether any conditions to drawing
could then be met.
Stated Maturity shall mean, with respect to any installment of interest or principal on
any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be
paid in the original documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior to the date originally
scheduled for payment thereof; provided that, with respect to any pollution control revenue bonds or

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similar instruments, the Stated Maturity of any series thereof shall be deemed to be the date set forth in
any instrument governing such Indebtedness for the remarketing of such Indebtedness.
[Steering Committee shall have the meaning given therefor in the Restructuring Term
Sheet.]
Stock shall mean shares of capital stock or shares in the capital, as the case may be
(whether denominated as common stock or preferred stock or ordinary shares or preferred shares, as the
case may be), beneficial, partnership or membership interests, participations or other equivalents
(regardless of how designated) of or in a corporation, partnership, limited liability company or equivalent
entity, whether voting or non-voting.
Stock Equivalents shall mean all securities convertible into or exchangeable for Stock
and all warrants, options or other rights to purchase or subscribe for any Stock, whether or not presently
convertible, exchangeable or exercisable.
Subsidiary of any Person shall mean and include (a) any corporation more than 50%
of whose Stock of any class or classes having by the terms thereof ordinary voting power to elect a
majority of the directors of such corporation (irrespective of whether or not at the time Stock of any class
or classes of such corporation shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person directly or indirectly through Subsidiaries and (b) any
limited liability company, partnership, association, joint venture or other entity of which such Person
directly or indirectly through Subsidiaries has more than a 50% equity interest at the time or is a
controlling general partner. Unless otherwise expressly provided, all references herein to a Subsidiary
shall mean a Subsidiary of the Borrower.
Subsidiary Guarantor shall mean each Guarantor that is a Subsidiary of the
Borrower.
Superpriority Claim shall mean superpriority administrative expense claim with
priority over any and all other obligations, liabilities and indebtedness, now existing or hereafter arising,
of any kind whatsoever, including any and all administrative expenses or other claims of the kind
specified in or arising under sections 105, 326, 328, 330, 331, 365, 503(a), 503(b), 506(c) (subject only to
and effective upon entry of the Final Order), 507(a), 507(b), 546(c), 726, 1113 and 1114 of the
Bankruptcy Code.
Swap Obligation shall mean, with respect to any Guarantor, any obligation to pay or
perform under any agreement, contract or transaction that constitutes a swap within the meaning of
section 1a(47) of the Commodity Exchange Act.
Swap Termination Value shall mean, in respect of any one or more Hedging
Agreements, after taking into account the effect of any legally enforceable netting agreement relating to
such Hedging Agreements, (a) for any date on or after the date such Hedging Agreements have been
closed out and termination value(s) determined in accordance therewith, such termination value(s), and
(b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Hedging Agreements, as determined based upon one or more mid-market or other
readily available quotations provided by any recognized dealer in such Hedging Agreements (which may
include a Lender or any Affiliate of a Lender).
Tax Order shall mean that certain Order Authorizing the Debtors To Pay Certain
Prepetition Taxes and Fees [Docket No. __].

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Tax Sharing Agreements shall mean (i) the Federal and State Income Tax Allocation
Agreement among the Members of the Energy Future Holdings Corp. Consolidated Group, dated May 15,
2012 by and among Energy Future Holdings Corp. and the other parties thereto, (ii) the Amended and
Restated Tax Sharing Agreement, dated November 5, 2008, among Energy Future Holdings Corp., Oncor
Electric Delivery Holdings Company LLC, Oncor Electric Delivery Company LLC, Texas Transmission
Investment LLC and Oncor Management Investment LLC and (iii) any other tax sharing agreement, each
as amended, supplemented or otherwise modified from time to time in a manner that is not, in the
Borrowers reasonable judgment, adverse, taken as a whole, to the Lenders in any material respect.
Taxes shall mean any and all present or future taxes, duties, levies, imposts,
assessments, deductions, withholdings or other similar charges imposed by any Governmental Authority
whether computed on a separate, consolidated, unitary, combined or other basis and any interest, fines,
penalties or additions to tax with respect to the foregoing.
TCEH shall have the meaning provided in the preamble to this Agreement.
TCEH Debtors shall have the meaning set forth in the Recitals hereto.
Term Loan Commitment shall mean, on the date hereof, the amount set forth
opposite such Lenders name on Schedule 1.1(a) as such Lenders Term Loan Commitment and (b) in
the case of any Lender that becomes a Lender after the date hereof, the amount specified as such Lenders
Term Loan Commitment in the Assignment and Acceptance pursuant to which such Lender assumed a
portion of the Total Term Loan Commitment, in each case as the same may be changed from time to time
pursuant to the terms hereof. The aggregate amount of Term Loan Commitments outstanding as of the
Closing Date is $800,000,000.
Term Loan Facility shall mean the facility providing for the Term Loans.
Term Loan Lender shall mean each Lender holding a Term Loan.
Term Loans shall have the meaning provided in Section 2.1(a). Unless the context
shall otherwise require, the term Term Loans shall include any Incremental Term Loans. As set forth in
Section 2.1(b)(ii), immediately after any Delayed-Draw Term Loans are funded pursuant to Section
2.1(b), such Loans will automatically be deemed to constitute Term Loans, and to not constitute Delayed-
Draw Term Loans, for all purposes of this Credit Agreement and the other Credit Documents (except for
purposes of the definitions of Available Delayed-Draw Term Loan Commitment and Available Term
Loan Commitment).
Test Period shall mean, for any determination under this Agreement, the four
consecutive fiscal quarters of the Borrower then last ended and for which Section 9.1 Financials have
been or were required to have been delivered.
Tex-La Indebtedness shall mean the obligations owing by Parent Guarantor in respect
of obligations between Parent Guarantor (or its legal predecessors in interest) and the Tex-La Electric
Cooperative of Texas, Inc., in aggregate principal amount of approximately $62,000,000 as of the Closing
Date, which obligations are secured by a Lien on a 2.17% undivided interest in Comanche Peak Unit 1
and Comanche Peak Unit 2 (each as defined in the definition of Baseload Generation Assets).
Total Credit Exposure shall mean, at any date, the sum, without duplication, of (a) the
Total Revolving Credit Commitment (if any) at such date or, if the Total Revolving Credit Commitment
shall have terminated on or prior to such date, the aggregate outstanding principal amount of all

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Revolving Credit Loans (if any) at such date (which shall be equal to the aggregate Revolving Credit
Exposure of all Revolving Credit Lenders), (b) the Available Delayed-Draw Term Loan Commitment (if
any) at such date, (c) the aggregate outstanding principal amount of all Delayed-Draw Term Loans (if
any) at such date, (d) the Available Total Term Loan Commitment (if any) at such date and (e) the
aggregate outstanding principal amount of all Term Loans (if any) at such date.
Total Delayed-Draw Term Loan Commitment shall mean the sum of the Delayed-
Draw Term Loan Commitments of all the Lenders.
Total Revolving Credit Commitment shall mean the sum of the Revolving Credit
Commitments of all the Lenders.
Total Term Loan Commitment shall mean the sum of the Term Loan Commitments
of all the Lenders.
Transaction Expenses shall mean any fees, costs, liabilities or expenses incurred or
paid by the Ultimate Parent, Parent Guarantor or any of their respective Subsidiaries in connection with
the Transactions, this Agreement and the other Credit Documents and the transactions contemplated
hereby and thereby including in respect of the commitments, negotiation, syndication, documentation and
closing (and post-closing actions in connection with the Collateral) of the Credit Facilities.
Transactions shall mean, collectively, the transactions contemplated by this
Agreement to occur on or around the Closing Date (including the entering into and funding hereunder, the
preparation and filing of the Cases, the preparation and documentation of the other transactions set forth
in the Restructuring Support Agreement), the payment of fees, costs, liabilities and expenses in
connection with each of the foregoing, and the consummation of any other transaction connected with the
foregoing.
Transferee shall have the meaning provided in Section 13.6(e).
Transition Charges shall have the meaning provided in in Section 39.302(7) of the
Texas Utilities Code.
Transition Property shall have the meaning provided in Section 39.302(8) of the
Texas Utilities Code.
Trust Indenture Act shall have the meaning provided in Section 12.11.
Type shall mean, (a) as to any Term Loan, its nature as an ABR Loan or a LIBOR
Loan, (b) as to any Delayed-Draw Term Loan, its nature as an ABR Loan or a LIBOR Loan and (c) as to
any Revolving Credit Loan, its nature as an ABR Loan or a LIBOR Loan.
UCC shall mean the Uniform Commercial Code of the State of New York or the State
of Texas, as applicable, or of any other state the laws of which are required to be applied in connection
with the perfection of security interests in any Collateral.
Ultimate Parent shall mean Energy Future Holdings Corp., a Texas corporation.
Unfunded Current Liability of any Plan shall mean the amount, if any, by which the
Accumulated Benefit Obligation (as defined under Statement of Financial Accounting Standards No. 87

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(SFAS 87)) under the Plan as of the close of its most recent plan year, determined in accordance with
SFAS 87 as in effect on the Closing Date, exceeds the fair market value of the assets allocable thereto.
Unit shall mean an individual power plant generation system comprised of all
necessary physically connected generators, reactors, boilers, combustion turbines and other prime movers
operated together to independently generate electricity.
Unpaid Drawing shall have the meaning provided in Section 3.4(a).
Unrestricted Cash shall mean, without duplication, (a) all cash and cash equivalents
(in each case, free and clear of all Liens, other than nonconsensual Liens permitted by Section 10.2(l) and
Liens permitted by Sections 10.2(a), (j) and (bb) and clauses (i) and (ii) of Section 10.2(o)) included in
the cash and cash equivalents accounts listed on the consolidated balance sheet of the Borrower and the
Restricted Subsidiaries as at such date and (b) all margin deposits related to commodity positions listed as
assets on the consolidated balance sheet of the Borrower and the Restricted Subsidiaries; provided that
Unrestricted Cash shall not include any amounts on deposit in or credited to any RCT L/C Collateral
Account or General L/C Collateral Account.
Unrestricted Subsidiary shall mean (a) the Subsidiaries set forth on Schedule 1.1(c)
hereto; (b) any Subsidiary of the Borrower that is formed or acquired after the Closing Date; provided that
at such time (or promptly thereafter) the Borrower designates such Subsidiary an Unrestricted Subsidiary
in a written notice to the Administrative Agent, (c) any Restricted Subsidiary subsequently designated as
an Unrestricted Subsidiary by the Borrower in a written notice to the Administrative Agent; provided that
in the case of (b) and (c), (x) such designation shall be deemed to be an Investment (or reduction in an
outstanding Investment, in the case of a designation of an Unrestricted Subsidiary as a Restricted
Subsidiary) on the date of such designation in an amount equal to the net book value of the investment
therein and such designation shall be permitted only to the extent permitted under Section 10.5 on the date
of such designation and (y) no Default or Event of Default would result from such designation after
giving Pro Forma Effect thereto and (d) each Subsidiary of an Unrestricted Subsidiary. The Borrower
may, by written notice to the Administrative Agent, re-designate any Unrestricted Subsidiary as a
Restricted Subsidiary, and thereafter, such Subsidiary shall no longer constitute an Unrestricted
Subsidiary, but only if (x) to the extent such Subsidiary has outstanding Indebtedness on the date of such
designation, immediately after giving effect to such designation, the Borrower shall be in compliance, on
a Pro Forma Basis, after giving effect to the incurrence of such Indebtedness, with the covenant set forth
in Section 10.9 and (y) no Default or Event of Default would result from such re-designation. On or
promptly after the date of its formation, acquisition, designation or re-designation, as applicable, each
Unrestricted Subsidiary (other than an Unrestricted Subsidiary that is a Foreign Subsidiary) shall have
entered into a tax sharing agreement containing terms that, in the reasonable judgment of the
Administrative Agent, provide for an appropriate allocation of tax liabilities and benefits; provided that
the tax sharing agreements described in clauses (i) and (ii) of the definition of Tax Sharing Agreements
as in effect on the date hereof shall be deemed to satisfy such standard.
U.S. Lender shall have the meaning provided in Section 5.4(h).
Voting Stock shall mean, with respect to any Person, such Persons Stock or Stock
Equivalents having the right to vote for the election of directors or other governing body of such Person
under ordinary circumstances.
Wages Order shall mean the Final Order Authorizing Energy Future Holdings Corp.,
et al., To (a) Pay Certain Prepetition Wages, Salaries, Reimbursable Employee Expenses, and Other

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Compensation, (b) Pay and Honor Employee and Retiree Medical and Similar Benefits, and (c) Continue
Employee Compensation and Employee and Retiree Benefit Programs as in effect from time to time.
Wholly Owned shall mean, with respect to the ownership by a Person of a Subsidiary,
that all of the Stock of such Subsidiary (other than directors qualifying shares or nominee or other similar
shares required pursuant to Applicable Law) are owned by such Person or another Wholly Owned
Subsidiary of such Person.
Yield shall mean, with respect to any Commitments and/or Loans, on any date of
determination, the yield to maturity, in each case, based on the interest rate applicable to such
Commitments and/or Loans on such date and giving effect to interest rate floors and any original issue
discount or upfront fees, but excluding any customary arrangement, administrative, advisory, origination
or similar fees in connection therewith that are not paid to all of the Lenders providing such
Commitments and/or Loans).
1.2. Other Interpretive Provisions. With reference to this Agreement and each other
Credit Document, unless otherwise specified herein or in such other Credit Document:
(a) The meanings of defined terms are equally applicable to the singular and plural
forms of the defined terms.
(b) The words herein, hereto, hereof and hereunder and words of similar
import when used in any Credit Document shall refer to such Credit Document as a whole and not to any
particular provision thereof.
(c) Article, Section, Exhibit and Schedule references are to the Credit Document in
which such reference appears.
(d) The term including is by way of example and not limitation.
(e) The term documents includes any and all instruments, documents, agreements,
certificates, notices, reports, financial statements and other writings, however evidenced, whether in
physical or electronic form.
(f) The words asset and property shall be construed to have the same meaning
and effect and refer to any and all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.
(g) All references to knowledge or awareness of any Credit Party or a Restricted
Subsidiary thereof means the actual knowledge of an Authorized Officer of a Credit Party or such
Restricted Subsidiary.
(h) In the computation of periods of time from a specified date to a later specified
date, the word from means from and including; the words to and until each mean to but
excluding; and the word through means to and including.
(i) Section headings herein and in the other Credit Documents are included for
convenience of reference only and shall not affect the interpretation of this Agreement or any other Credit
Document.

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(j) For purposes of determining compliance with any one of Sections 10.1, 10.2,
10.3, 10.4, 10.5, 10.6, 10.7 and 1.1(a), in the event that any Lien, Investment, Indebtedness, merger,
consolidation, amalgamation or similar fundamental change, Disposition, dividend, affiliate transaction,
contractual obligation or prepayment of Indebtedness meets the criteria of more than one of the categories
of transactions permitted pursuant to any clause of such Section, such transaction (or portion thereof) at
any time shall be permitted under one or more of such clauses as determined by the Borrower (and the
Borrower shall be entitled to redesignate use of any such clauses from time to time) in its sole discretion
at such time.
1.3. Accounting Terms.
(a) All accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with,
GAAP.
(b) Notwithstanding anything to the contrary herein, for purposes of determining
compliance with any test or covenant contained in this Agreement with respect to any period during
which any Specified Transaction occurs, the Consolidated Superpriority Secured Net Debt to
Consolidated EBITDA Ratio shall each be calculated with respect to such period and such Specified
Transaction on a Pro Forma Basis.
1.4. Rounding. Any financial ratios required to be maintained by the Borrower
pursuant to this Agreement (or required to be satisfied in order for a specific action to be permitted under
this Agreement) shall be calculated by dividing the appropriate component by the other component,
carrying the result to one place more than the number of places by which such ratio is expressed herein
and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest
number).
1.5. References to Agreements, Laws, Etc. Unless otherwise expressly provided
herein, (a) references to organizational documents, agreements (including the Credit Documents) and
other Contractual Requirements shall be deemed to include all subsequent amendments, restatements,
amendment and restatements, extensions, supplements and other modifications thereto, but only to the
extent that such amendments, restatements, amendment and restatements, extensions, supplements and
other modifications are permitted by any Credit Document; and (b) references to any Applicable Law
shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Applicable Law.
1.6. Times of Day. Unless otherwise specified, all references herein to times of day
shall be references to Eastern time (daylight or standard, as applicable).
1.7. Timing of Payment of Performance. When the payment of any obligation or the
performance of any covenant, duty or obligation is stated to be due or performance required on a day
which is not a Business Day, the date of such payment (other than as described in the definition of Interest
Period) or performance shall extend to the immediately succeeding Business Day.
1.8. Currency Equivalents Generally. For purposes of determining compliance under
Sections 10.4, 10.5 and 10.6 with respect to any amount denominated in any currency other than Dollars
(other than with respect to (a) any amount derived from the financial statements of the Borrower and the
Subsidiaries of the Borrower or (b) any Indebtedness denominated in a currency other than Dollars), such
amount shall be deemed to equal the Dollar equivalent thereof based on the average Exchange Rate for

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such other currency for the most recent twelve-month period immediately prior to the date of
determination determined in a manner consistent with that used in calculating Consolidated EBITDA for
the related period. For purposes of determining compliance with Sections 10.1, 10.2 and 10.5, with
respect to any amount of Indebtedness in a currency other than Dollars, compliance will be determined at
the time of incurrence or advancing thereof using the Dollar equivalent thereof at the Exchange Rate in
effect at the time of such incurrence or advancement.
1.9. Classification of Loans and Borrowings. For purposes of this Agreement, Loans
may be classified and referred to by Class (e.g., a Revolving Credit Loan) or by Type (e.g., a LIBOR
Loan) or by Class and Type (e.g., a LIBOR Revolving Credit Loan). Borrowings also may be
classified and referred to by Class (e.g., a Revolving Credit Borrowing) or by Type (e.g., a LIBOR
Borrowing) or by Class and Type (e.g., a LIBOR Revolving Credit Borrowing).
1.10. Hedging Agreements. For the avoidance of doubt, it is understood that the
following Hedging Agreements and/or Commodity Hedging Agreements shall not be deemed to be
speculative or entered into for speculative purposes for any purpose of this Agreement and all other Credit
Documents: (a) any Commodity Hedging Agreement intended, at inception or execution, to hedge or
manage any of the risks related to existing and/or forecasted power generation or load of the Borrower or
the Restricted Subsidiaries (whether owned or contracted), (b) any Hedging Agreement intended, at
inception or execution, (i) to hedge or manage the interest rate exposure associated with any debt
securities, debt facilities or leases (existing or forecasted) of the Borrower or the Restricted Subsidiaries,
(ii) for foreign exchange or currency exchange management, (iii) to manage commodity portfolio
exposure associated with changes in interest rates or (iv) to hedge any exposure that the Borrower or the
Restricted Subsidiaries may have to counterparties under other Hedging Agreements such that the
combination of such Hedging Agreements is not speculative taken as a whole and (c) any Hedging
Agreement and/or Commodity Hedging Agreement, as applicable, entered into by the Borrower or any
Restricted Subsidiary (in each case, entered into in the ordinary course of business or consistent with past
practice) that was intended, at inception or execution, to unwind or offset any Hedging Agreement and/or
Commodity Hedging Agreement, as applicable, described in clauses (a) and (b) of this Section 1.10.
SECTION 2. Amount and Terms of Credit.
2.1. Commitments.
(a) Subject to and upon the terms and conditions set forth in this Agreement, each
Lender having a Term Loan Commitment, severally, but not jointly, agrees to make a loan (each a Term
Loan and, collectively, the Term Loans) in Dollars to the Borrower (x) on the Closing Date, which
Term Loans shall equal the amount requested by the Borrower, not to exceed (i) for any such Lender, the
Available Term Loan Commitment of such Lender, and (ii) in the aggregate, the Available Term Loan
Commitment, and (y) on the Full Availability Date, which Term Loans shall equal the amount requested
by the Borrower, not to exceed (i) for any such Lender, the Available Term Loan Commitment of such
Lender, and (ii) in the aggregate, the Available Term Loan Commitment.
(i) The Term Loans may, at the option of the Borrower, be incurred, maintained as,
and/or converted into, ABR Loans or LIBOR Loans in accordance with Section 2.6; provided that
all such Term Loans made by each of the Lenders pursuant to the same Borrowing shall, unless
otherwise specifically provided herein, consist entirely of Term Loans of the same Type. The
Term Loans may be repaid or prepaid in accordance with the provisions hereof, but once repaid
or prepaid may not be reborrowed.

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(ii) All Term Loans funded on the Full Availability Date will be of the same Type
and, in the case of LIBOR Loans, have the same Interest Periods and LIBOR Rate as all other
LIBOR Term Loans then outstanding (on a ratable basis if there is more than one Borrowing of
Term Loans then outstanding); provided that the initial Interest Period of any such LIBOR Term
Loans funded on the Full Availability Date shall commence on the Full Availability Date and
shall end on the last day of the then-current Interest Period for all other LIBOR Term Loans then
outstanding (on a ratable basis if there is more than one Borrowing of other LIBOR Term Loans
then outstanding).
(b) Subject to and upon the terms and conditions herein set forth, each Lender having
a Delayed-Draw Term Loan Commitment severally, but not jointly, agrees to make a loan or loans (each
a Delayed-Draw Term Loan and, collectively, the Delayed-Draw Term Loans) in Dollars to the
Borrower.
(i) Such Delayed-Draw Term Loans (A) shall be made at any time and from time to
time on and after the Closing Date and prior to Delayed-Draw Termination Date, but only if the
Borrower shall have theretofore issued and delivered the RCT Carve Out Support Rejection
Notice pursuant to Section 4.4, (B) shall equal the amount requested by the Borrower, not to
exceed, for any such Lender, the Available Delayed-Draw Term Loan Commitment of such
Lender, (C) shall equal the amount requested by the Borrower, not to exceed, in the aggregate, the
Total-Delayed Draw Term Loan Commitment and (D) may, at the option of the Borrower, be
maintained as, and/or converted into, ABR Loans or LIBOR Loans in accordance with Section
2.6; provided that all such Delayed Draw Term Loans made by each of the Lenders pursuant to
the same Borrowing shall, unless otherwise specifically provided herein, consist entirely of
Delayed Draw Term Loans of the same Type. The Delayed-Draw Term Loans may be repaid or
prepaid in accordance with the provisions hereof, but once repaid or prepaid may not be
reborrowed.
(ii) Notwithstanding anything to the contrary herein, immediately after any Delayed-
Draw Term Loans are funded pursuant to this Section 2.1(b), such Loans will automatically be
deemed to constitute Term Loans, and to not constitute Delayed-Draw Term Loans, for all
purposes of this Credit Agreement and the other Credit Documents (except for purposes of the
definitions of Available Delayed-Draw Term Loan Commitment and Available Term Loan
Commitment). Without limitation of the foregoing, all such Loans (x) will have the same terms,
be part of the same Class and be assigned the same CUSIP as all other Term Loans and (y) be of
the same Type and, in the case of LIBOR Loans, have the same Interest Periods and LIBOR Rate
as all other LIBOR Term Loans then outstanding (on a ratable basis if there is more than one
Borrowing of Term Loans then outstanding); provided that the initial Interest Period of any such
LIBOR Loans shall commence on the date such Loans are made and shall end on the last day of
the then-current Interest Period for all other LIBOR Term Loans then outstanding (on a ratable
basis if there is more than one Borrowing of other LIBOR Term Loans then outstanding).
(c) Subject to and upon the terms and conditions herein set forth, each Lender having
a Revolving Credit Commitment severally, but not jointly, agrees to make a loan or loans (each a
Revolving Credit Loan and, collectively, the Revolving Credit Loans) in Dollars to the Borrower;
provided that prior to the Full Availability Date, the aggregate principal amount of the Lenders
Revolving Credit Exposures shall not exceed the Interim Availability Amount. Such Revolving Credit
Loans (A) shall be made at any time and from time to time on and after the Closing Date and prior to
Revolving Credit Termination Date, (B) may, at the option of the Borrower, be incurred and maintained
as, and/or converted into, ABR Loans or LIBOR Loans; provided that all Revolving Credit Loans made
by each of the Lenders pursuant to the same Borrowing shall, unless otherwise specifically provided

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herein, consist entirely of Revolving Credit Loans of the same Type, (C) may be repaid and reborrowed in
accordance with the provisions hereof, (D) shall not, for any Lender at any time with respect to any Class
of Revolving Credit Loan, after giving effect thereto and to the application of the proceeds thereof, result
in such Lenders Revolving Credit Exposure with respect to such Class at such time exceeding such
Lenders Revolving Credit Commitment with respect to such Class at such time and (E) shall not, after
giving effect thereto and to the application of the proceeds thereof, result at any time in the aggregate
amount of the Lenders Revolving Credit Exposures at such time exceeding the Total Revolving Credit
Commitment then in effect.
(d) Each Lender may at its option make any LIBOR Loan by causing any domestic
or foreign branch or Affiliate of such Lender to make such Loan; provided that (A) any exercise of such
option shall not affect the obligation of the Borrower to repay such Loan and (B) in exercising such
option, such Lender shall use its reasonable efforts to minimize any increased costs to the Borrower
resulting therefrom (which obligation of the Lender shall not require it to take, or refrain from taking,
actions that it determines would result in increased costs for which it will not be compensated hereunder
or that it determines would be otherwise disadvantageous to it and in the event of such request for costs
for which compensation is provided under this Agreement, the provisions of Section 2.10 shall apply).
2.2. Minimum Amount of Each Borrowing; Maximum Number of Borrowings. The
aggregate principal amount of each Borrowing of Loans shall be in a minimum amount of at least the
Minimum Borrowing Amount for such Type of Loan and in a multiple of $1,000,000 in excess thereof;
provided that there shall be no more than two drawings of Delayed-Draw Term Loans. More than one
Borrowing may be incurred on any date; provided that at no time shall there be outstanding more than (i)
twenty (20), in the case of Revolving Credit Loans (ii) ten (10), in the case of Term Loan Borrowings of
LIBOR Loans and (iii) ten (10), in the case of Delayed-Draw Term Loan Borrowings under this
Agreement. For the avoidance of doubt, unless otherwise determined by the Borrower, all Loans of the
same Class subject to the same Interest Period and drawn on the same date will constitute one Borrowing.
2.3. Notice of Borrowing; Determination of Class of Loans.
(a) When the Borrower desires to incur Term Loans, the Borrower shall deliver to
the Administrative Agent at the Administrative Agents Office a Notice of Borrowing (or telephonic
notice promptly confirmed by delivery of a Notice of Borrowing) (i) prior to 1:00 p.m. (New York City
time) at least three Business Days prior to the date of the proposed Borrowing of Term Loans or
Delayed-Draw Term Loans if all or any of such Loans are to be initially LIBOR Loans, and (ii) prior to
10:00 a.m. (New York City time) on the date of the proposed Borrowing of Term Loans or Delayed-Draw
Term Loans if all or any of such Loans are to be ABR Loans. Each Notice of Borrowing shall specify (i)
the aggregate principal amount of Loans to be made, (ii) the date of the Borrowing and (iii) whether such
Loans shall consist of ABR Loans and/or LIBOR Loans and, if the Loans are to include LIBOR Loans,
the Interest Period to be initially applicable thereto. The Administrative Agent shall promptly give each
applicable Lender written notice (or telephonic notice promptly confirmed in writing) of the proposed
Borrowing of Loans, of such Lenders proportionate share thereof and of the other matters covered by the
related Notice of Borrowing.
(b) [Reserved].
(c) [Reserved].
(d) Whenever the Borrower desires to incur Revolving Credit Loans, the Borrower
shall give the Administrative Agent at the Administrative Agents Office, (i) prior to 1:00 p.m. (New
York City time) at least three Business Days prior written notice (or telephonic notice promptly

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confirmed in writing) of each Borrowing of Revolving Credit Loans if all or any of such Revolving Credit
Loans are to be initially LIBOR Loans and (ii) prior to 1:00 p.m. (New York City time) at least one
Business Days prior written notice (or telephonic notice promptly confirmed in writing) of each
Borrowing of Revolving Credit Loans if all or any of such Revolving Credit Loans are to be ABR Loans.
Each such Notice of Borrowing shall specify (i) the aggregate principal amount of the Revolving Credit
Loans to be made pursuant to such Borrowing, (ii) the date of the Borrowing (which shall be a Business
Day) and (iii) whether the Borrowing shall consist of ABR Loans and/or LIBOR Loans and, if LIBOR
Loans, the Interest Period to be initially applicable thereto. The Administrative Agent shall promptly give
each Revolving Credit Lender written notice (or telephonic notice promptly confirmed in writing) of each
proposed Borrowing of Revolving Credit Loans, of such Lenders Revolving Credit Commitment
Percentage thereof and of the other matters covered by the related Notice of Borrowing.
(e) [Reserved].
(f) [Reserved].
(g) [Reserved].
(h) Without in any way limiting the obligation of the Borrower to confirm in writing
any notice it may give hereunder by telephone, the Administrative Agent may act prior to receipt of
written confirmation without liability upon the basis of such telephonic notice believed by the
Administrative Agent in good faith to be from an Authorized Officer of the Borrower.
2.4. Disbursement of Funds.
(a) No later than 2:00 p.m. (New York City time) on the date specified in each
Notice of Borrowing, each Lender will make available its pro rata portion, if any, of each Borrowing
requested to be made on such date in the manner provided below.
(b) Each Lender shall make available all amounts required under any Borrowing for
its applicable Commitments in immediately available funds to the Administrative Agent at the
Administrative Agents Office in Dollars, and the Administrative Agent will make available to the
Borrower, by depositing to an account designated by the Borrower to the Administrative Agent the
aggregate of the amounts so made available in Dollars. Unless the Administrative Agent shall have been
notified by any Lender prior to the date of any such Borrowing that such Lender does not intend to make
available to the Administrative Agent its portion of the Borrowing or Borrowings to be made on such
date, the Administrative Agent may assume that such Lender has made such amount available to the
Administrative Agent on such date of Borrowing, and the Administrative Agent, in reliance upon such
assumption, may (in its sole discretion and without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding amount is not in fact made available to the
Administrative Agent by such Lender and the Administrative Agent has made available such amount to
the Borrower, the Administrative Agent shall be entitled to recover such corresponding amount from such
Lender. If such Lender does not pay such corresponding amount forthwith upon the Administrative
Agents demand therefor the Administrative Agent shall promptly notify the Borrower and the Borrower
shall immediately pay such corresponding amount to the Administrative Agent in Dollars. The
Administrative Agent shall also be entitled to recover from such Lender or the Borrower interest on such
corresponding amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower to the date such corresponding amount is
recovered by the Administrative Agent, at a rate per annum equal to (i) if paid by such Lender, the
Overnight Rate or (ii) if paid by the Borrower, the then-applicable rate of interest or fees, calculated in
accordance with Section 2.8, for the Loans of the applicable Class.

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(c) Nothing in this Section 2.4 shall be deemed to relieve any Lender from its
obligation to fulfill its commitments hereunder or to prejudice any rights that the Borrower may have
against any Lender as a result of any default by such Lender hereunder (it being understood, however,
that no Lender shall be responsible for the failure of any other Lender to fulfill its commitments
hereunder).
2.5. Repayment of Loans; Evidence of Debt.
(a) The Borrower shall repay to the Administrative Agent, for the benefit of the
applicable Lenders, on the Maturity Date, (i) the then outstanding Term Loans, (ii) the then outstanding
Delayed-Draw Term Loans and (iii) the then outstanding Revolving Credit Loans.
(b) [Reserved].
(c) In the event any Incremental Term Loans are made, such Incremental Term
Loans, as applicable, shall be repaid in amounts and on dates as agreed between the Borrower and the
relevant Lenders of such Incremental Term Loans, subject to the requirements set forth in Section 2.14.
(d) Each Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of the Borrower to the appropriate lending office of such Lender
resulting from each Loan made by such lending office of such Lender from time to time, including the
amounts of principal and interest payable and paid to such lending office of such Lender from time to
time under this Agreement.
(e) The Administrative Agent shall maintain the Register pursuant to
Section 13.6(b), and a subaccount for each Lender, in which Register and subaccounts (taken together)
shall be recorded (i) the amount of each Loan made hereunder, whether such Loan is a Term Loan, an
Incremental Term Loan, a Delayed-Draw Term Loan, a Revolving Credit Loan or a New Revolving
Credit Loan, as applicable, the Type of each Loan made and the Interest Period applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and payable from the Borrower to
each Lender hereunder, and (iii) the amount of any sum received by the Administrative Agent hereunder
from the Borrower and each Lenders share thereof.
(f) The entries made in the Register and accounts and subaccounts maintained
pursuant to clauses (d) and (e) of this Section 2.5 shall, to the extent permitted by Applicable Law, be
prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded;
provided, however, that the failure of any Lender or the Administrative Agent to maintain such account,
such Register or such subaccount, as applicable, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to the Borrower by such
Lender in accordance with the terms of this Agreement.
2.6. Conversions and Continuations.
(a) Subject to the penultimate sentence of this clause (a), (x) the Borrower shall have
the option on any Business Day to convert all or a portion equal to no less than the Minimum Borrowing
Amount of the outstanding principal amount of Term Loans, Delayed-Draw Term Loans or Revolving
Credit Loans of one Type into a Borrowing or Borrowings of another Type and (y) the Borrower shall
have the option on any Business Day to continue the outstanding principal amount of any LIBOR Loans
as LIBOR Loans for an additional Interest Period; provided that (i) no partial conversion of LIBOR Loans
shall reduce the outstanding principal amount of LIBOR Loans made pursuant to a single Borrowing to
less than the Minimum Borrowing Amount, (ii) ABR Loans may not be converted into LIBOR Loans if a

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Payment Default or Event of Default is in existence on the date of the conversion and the Administrative
Agent has or the Required Lenders have determined in its or their sole discretion not to permit such
conversion, (iii) LIBOR Loans may not be continued as LIBOR Loans for an additional Interest Period if
a Default or Event of Default is in existence on the date of the proposed continuation and the
Administrative Agent has or the Required Lenders have determined in its or their sole discretion not to
permit such continuation and (iv) Borrowings resulting from conversions pursuant to this Section 2.6
shall be limited in number as provided in Section 2.2. Each such conversion or continuation shall be
effected by the Borrower by giving the Administrative Agent at the Administrative Agents Office prior
to 1:00 p.m. (New York City time) at least (i) three Business Days, in the case of a continuation of, or
conversion to, LIBOR Loans or (ii) one Business Days in the case of a conversion into ABR Loans, prior
written notice (or telephonic notice promptly confirmed in writing) (each, a Notice of Conversion or
Continuation) specifying the Loans to be so converted or continued, the Type of Loans to be converted
into or continued and, if such Loans are to be converted into, or continued as, LIBOR Loans, the Interest
Period to be initially applicable thereto (if no Interest Period is selected, the Borrower shall be deemed to
have selected an Interest Period of one months duration). The Administrative Agent shall give each
applicable Lender notice as promptly as practicable of any such proposed conversion or continuation
affecting any of its Loans.
(b) If any Payment Default or Event of Default is in existence at the time of any
proposed continuation of any LIBOR Loans and the Administrative Agent has or the Required Lenders
have determined in its or their sole discretion not to permit such continuation, such LIBOR Loans shall be
automatically converted on the last day of the current Interest Period into ABR Loans. If upon the
expiration of any Interest Period in respect of LIBOR Loans, the Borrower has failed to elect a new
Interest Period to be applicable thereto as provided in clause (a) above, the Borrower shall be deemed to
have elected to convert such Borrowing of LIBOR Loans into a Borrowing of ABR Loans, effective as of
the expiration date of such current Interest Period.
(c) Notwithstanding anything to the contrary herein, the Borrower may deliver a
Notice of Conversion or Continuation pursuant to which the Borrower elects to irrevocably continue the
outstanding principal amount of any Term Loans or Delayed-Draw Term Loans subject to an interest rate
Hedging Agreement as LIBOR Loans for each Interest Period until the expiration of the term of such
applicable Hedging Agreement.
2.7. Pro RataBorrowings. Subject to Section 2.1(c), each Borrowing of Revolving
Credit Loans under this Agreement shall be made by the Lenders pro rata on the basis of their then
applicable Revolving Credit Commitments without regard to the Class of Revolving Credit Commitments
held by such Lender. It is understood that (a) no Lender shall be responsible for any default by any other
Lender in its obligation to make Loans hereunder and that each Lender severally but not jointly shall be
obligated to make the Loans provided to be made by it hereunder, regardless of the failure of any other
Lender to fulfill its commitments hereunder and (b) failure by a Lender to perform any of its obligations
under any of the Credit Documents shall not release any Person from performance of its obligation under
any Credit Document.
2.8. Interest.
(a) The unpaid principal amount of each ABR Loan shall bear interest from the date
of the Borrowing thereof until maturity (whether by acceleration or otherwise) at a rate per annum that
shall at all times be the Applicable ABR Margin plus the ABR, in each case, in effect from time to time.
(b) The unpaid principal amount of each LIBOR Loan shall bear interest from the
date of the Borrowing thereof until maturity thereof (whether by acceleration or otherwise) at a rate per

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annum that shall at all times be the Applicable LIBOR Margin plus the relevant LIBOR Rate, in each case
in effect from time to time.
(c) [Reserved].
(d) If all or a portion of (i) the principal amount of any Loan or (ii) any interest
payable thereon or any other amount hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), and an Event of Default shall exist as a result of such failure to
pay, then upon the giving of written notice by the Administrative Agent to the Borrower, such overdue
amount shall bear interest at a rate per annum (the Default Rate) that is (x) in the case of overdue
principal, the rate that would otherwise be applicable thereto plus 2% or (y) in the case of any overdue
interest or other amounts due hereunder, to the extent permitted by Applicable Law, the rate described in
Section 2.8(a) plus 2% from the date of such non-payment to the date on which such amount is paid in
full (after as well as before judgment).
(e) Interest on each Loan shall accrue from and including the date of any Borrowing
to but excluding the date of any repayment thereof and shall be payable in Dollars; provided that any
Loan that is repaid on the same date on which it is made shall bear interest for one day. Except as
provided below, interest shall be payable (i) in respect of each ABR Loan, monthly in arrears on the third
Business Day of each calendar month, (ii) in respect of each LIBOR Loan, on the last day of each Interest
Period applicable thereto and, in the case of an Interest Period in excess of three months, on each date
occurring at three-month intervals after the first day of such Interest Period and (iii) in respect of each
Loan, (A) on any prepayment; provided that interest on ABR Loans shall only become due pursuant to
this subclause (A) if the aggregate principal amount of the ABR Loans then-outstanding is repaid in full,
(B) at maturity (whether by acceleration or otherwise) and (C) after such maturity, on demand.
(f) All computations of interest hereunder shall be made in accordance with
Section 5.5.
(g) The Administrative Agent, upon determining the interest rate for any Borrowing
of LIBOR Loans, shall promptly notify the Borrower and the relevant Lenders thereof. Each such
determination shall, absent clearly demonstrable error, be final and conclusive and binding on all parties
hereto.
2.9. Interest Periods. At the time the Borrower gives a Notice of Borrowing or Notice
of Conversion or Continuation in respect of the making of, or conversion into or continuation as, a
Borrowing of LIBOR Loans in accordance with Section 2.6(a), the Borrower shall give the
Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of the Interest
Period applicable to such Borrowing, which Interest Period shall, at the option of the Borrower, be a one
week (solely with respect to LIBOR Revolving Credit Loans) or a one, two, three or six or (if available to
all relevant Lenders participating in the relevant Credit Facility) a twelve month period or a period of less
than one month; provided that, notwithstanding the foregoing, the initial Interest Period beginning on the
Closing Date may be for a period of less than one month if agreed upon by the Borrower and the
Administrative Agent.
Notwithstanding anything to the contrary contained above:
(a) the initial Interest Period for any Borrowing of LIBOR Loans shall commence on
the date of such Borrowing (including the date of any conversion from a Borrowing of ABR Loans) and
each Interest Period occurring thereafter in respect of such Borrowing shall commence on the day on
which the next preceding Interest Period expires;

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(b) if any Interest Period relating to a Borrowing of LIBOR Loans begins on the last
Business Day of a calendar month or begins on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business
Day of the calendar month at the end of such Interest Period;
(c) if any Interest Period would otherwise expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business Day; provided that if any Interest Period
in respect of a LIBOR Loan would otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such Interest Period shall expire on the
next preceding Business Day; and
(d) the Borrower shall not be entitled to elect any Interest Period in respect of any
LIBOR Loan if such Interest Period would extend beyond the applicable Maturity Date of such Loan.
2.10. Increased Costs, Illegality, Etc.
(a) In the event that (x) in the case of clause (i) below, the Administrative Agent or
(y) in the case of clauses (ii) and (iii) below, any Lender shall have reasonably determined (which
determination shall, absent clearly demonstrable error, be final and conclusive and binding upon all
parties hereto):
(i) on any date for determining the LIBOR Rate for any Interest Period that
(x) deposits in the principal amounts and currencies of the Loans comprising such LIBOR
Borrowing, are not generally available in the relevant market or (y) by reason of any changes
arising on or after the Closing Date affecting the interbank LIBOR market, adequate and fair
means do not exist for ascertaining the applicable interest rate on the basis provided for in the
definition of LIBOR Rate; or
(ii) at any time, that such Lender shall incur increased costs or reductions in the
amounts received or receivable hereunder with respect to any LIBOR Loans (other than any
increase or reduction attributable to (i) Taxes indemnifiable under Section 5.4, (ii) net income
taxes and franchise and excise taxes (imposed in lieu of net income taxes) imposed on any Agent
or Lender or (iii) Taxes included under clauses (c) and (d) of the definition of Excluded Taxes)
because of (x) any change since the Closing Date in any Applicable Law (or in the interpretation
or administration thereof and including the introduction of any new Applicable Law), such as, for
example, without limitation, a change in official reserve requirements, and/or (y) other
circumstances affecting the interbank LIBOR market or the position of such Lender in such
market; or
(iii) at any time, that the making or continuance of any LIBOR Loan has become
unlawful as a result of compliance by such Lender in good faith with any Applicable Law (or
would conflict with any such Applicable Law not having the force of law even though the failure
to comply therewith would not be unlawful), or has become impracticable as a result of a
contingency occurring after the Closing Date that materially and adversely affects the interbank
LIBOR market;
then, and in any such event, such Lender (or the Administrative Agent, in the case of clause (i) above)
shall within a reasonable time thereafter give notice (if by telephone, confirmed in writing) to the
Borrower and to the Administrative Agent of such determination (which notice the Administrative Agent
shall promptly transmit to each of the other Lenders). Thereafter (x) in the case of clause (i) above,
LIBOR Loans shall no longer be available until such time as the Administrative Agent notifies the

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Borrower and the Lenders that the circumstances giving rise to such notice by the Administrative Agent
no longer exist (which notice the Administrative Agent agrees to give at such time when such
circumstances no longer exist), and any Notice of Borrowing or Notice of Conversion or Continuation
given by the Borrower with respect to LIBOR Loans, that have not yet been incurred shall be deemed
rescinded by the Borrower, as applicable, (y) in the case of clause (ii) above, the Borrower shall pay to
such Lender, promptly after receipt of written demand therefor such additional amounts (in the form of an
increased rate of or a different method of calculating, interest or otherwise, as such Lender in its
reasonable discretion shall determine) as shall be required to compensate such Lender for such increased
costs or reductions in amounts receivable hereunder (it being agreed that a written notice as to the
additional amounts owed to such Lender, showing in reasonable detail the basis for the calculation
thereof, submitted to the Borrower by such Lender shall, absent clearly demonstrable error, be final and
conclusive and binding upon all parties hereto) and (z) in the case of subclause (iii) above, the Borrower
shall take one of the actions specified in Section 2.10(b) as promptly as possible and, in any event, within
the time period required by Applicable Law.
(b) At any time that any LIBOR Loan is affected by the circumstances described in
Section 2.10(a)(ii) or (iii), the Borrower may (and in the case of a LIBOR Loan affected pursuant to
Section 2.10(a)(iii) shall) either (x) if the affected LIBOR Loan is then being made pursuant to a
Borrowing, cancel such Borrowing by giving the Administrative Agent telephonic notice (confirmed
promptly in writing) thereof on the same date that the Borrower was notified by a Lender pursuant to
Section 2.10(a)(ii) or (iii) or (y) if the affected LIBOR Loan is then-outstanding, upon at least three
Business Days notice to the Administrative Agent require the affected Lender to convert each such
LIBOR Loan into an ABR Loan; provided that if more than one Lender is affected at any time, then all
affected Lenders must be treated in the same manner pursuant to this Section 2.10(b).
(c) If, after the Closing Date, any Change in Law relating to capital adequacy or
liquidity of any Lender or compliance by any Lender or its parent with any Change in Law relating to
capital adequacy or liquidity occurring after the Closing Date, has or would have the effect of reducing
the rate of return on such Lenders or its parents or its Affiliates capital or assets as a consequence of
such Lenders commitments or obligations hereunder to a level below that which such Lender or its
parent or its Affiliate could have achieved but for such Change in Law (taking into consideration such
Lenders or its parents policies with respect to capital adequacy), then from time to time, promptly after
demand by such Lender (with a copy to the Administrative Agent, the Borrower shall pay to such Lender
such additional amount or amounts as will compensate such Lender or its parent for such reduction, it
being understood and agreed, however, that a Lender shall not be entitled to such compensation as a result
of such Lenders compliance with, or pursuant to any request or directive to comply with, any Applicable
Law as in effect on the Closing Date. Each Lender, upon determining in good faith that any additional
amounts will be payable pursuant to this Section 2.10(c), will give prompt written notice thereof to the
Borrower, which notice shall set forth in reasonable detail the basis of the calculation of such additional
amounts, although the failure to give any such notice shall not, subject to Section 2.13, release or
diminish the Borrowers obligations to pay additional amounts pursuant to this Section 2.10(c) upon
receipt of such notice.
2.11. Compensation. If (i) any payment of principal of any LIBOR Loan is made by the
Borrower to or for the account of a Lender other than on the last day of the Interest Period for such
LIBOR Loan as a result of a payment or conversion pursuant to Section 2.5, 2.6, 2.10, 5.1, 5.2 or 13.7, as
a result of acceleration of the maturity of the Loans pursuant to Section 11 or for any other reason, (ii) any
Borrowing of LIBOR Loans is not made as a result of a withdrawn Notice of Borrowing, (iii) any ABR
Loan is not converted into a LIBOR Loan as a result of a withdrawn Notice of Conversion or
Continuation, (iv) any LIBOR Loan is not continued as a LIBOR Loan, as the case may be, as a result of
a withdrawn Notice of Conversion or Continuation or (v) any prepayment of principal of any LIBOR

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Loan is not made as a result of a withdrawn notice of prepayment pursuant to Section 5.1 or 5.2, the
Borrower shall, after receipt of a written request by such Lender (which request shall set forth in
reasonable detail the basis for requesting such amount), pay to the Administrative Agent for the account
of such Lender any amounts required to compensate such Lender for any additional losses, costs or
expenses that such Lender may reasonably incur as a result of such payment, failure to convert, failure to
continue or failure to prepay, including any loss, cost or expense (excluding loss of anticipated profits)
actually incurred by reason of the liquidation or reemployment of deposits or other funds acquired by any
Lender to fund or maintain such LIBOR Loan.
2.12. Change of Lending Office. Each Lender agrees that, upon the occurrence of any
event giving rise to the operation of Section 2.10(a)(ii), 2.10(a)(iii), 2.10(b), 3.5 or 5.4 with respect to
such Lender, it will, if requested by the Borrower use reasonable efforts (subject to overall policy
considerations of such Lender) to designate another lending office for any Loans affected by such event;
provided that such designation is made on such terms that such Lender and its lending office suffer no
economic, legal or regulatory disadvantage, with the object of avoiding the consequence of the event
giving rise to the operation of any such Section. Nothing in this Section 2.12 shall affect or postpone any
of the obligations of the Borrower or the right of any Lender provided in Section 2.10, 3.5 or 5.4.
2.13. Notice of Certain Costs. Notwithstanding anything in this Agreement to the
contrary, to the extent any notice required by Section 2.10, 2.11, 3.5 or 5.4 is given by any Lender more
than 180 days after such Lender has knowledge (or should have had knowledge) of the occurrence of the
event giving rise to the additional cost, reduction in amounts, loss, tax or other additional amounts
described in such Sections, such Lender shall not be entitled to compensation under Section 2.10, 2.11,
3.5 or 5.4, as the case may be, for any such amounts incurred or accruing prior to the 181st day prior to
the giving of such notice to the Borrower.
2.14. Incremental Facilities.
(a) The Borrower may, at any time or from time to time after the Closing Date, by
notice to the Administrative Agent (whereupon the Administrative Agent shall promptly deliver a copy to
each of the Lenders), request (i) one or more additional tranches of term loans (the Incremental Term
Loans) or (ii) one or more increases in the amount of the Revolving Credit Commitments; (each such
increase, an Incremental Revolving Commitment Increase); together with the Incremental Term
Loans, the Incremental Facilities), provided that (A) both at the time of any such request and after
giving effect to the effectiveness of any Incremental Amendment referred to below, no Default or Event
of Default shall exist and at the time that any such Incremental Term Loan or Incremental Revolving
Commitment Increase is made or effected (and after giving effect thereto), the conditions in Section 7.1
shall be satisfied and (B) the Full Availability Date shall have occurred and (C) solely with respect to an
Incremental Revolving Commitment Increase, the Borrower shall be in compliance with the covenant set
forth in Section 10.9 for the most recently ended fiscal quarter determined on a Pro Forma Basis as of the
date of the making of such Incremental Revolving Commitment Increase.
(b) Each tranche of Incremental Term Loans and each Incremental Revolving
Commitment Increase shall be in an aggregate principal amount that is not less than $100,000,000
(provided that such amount may be less than $100,000,000 if such amount represents all remaining
availability under the limit set forth in the next sentence).
(c) The aggregate principal amount of all Incremental Facilities shall not exceed the
sum of (1) $750,000,000 plus (2) if the RCT Carve Out Support Rejection Notice shall have been issued
and delivered prior to the Delayed-Draw Termination Date, the Delayed-Draw Term Facility Reduction
Amount determined on a Pro Forma Basis after the incurrence of such Incremental Facility.

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(d) The Incremental Term Loans (i) shall rank pari passu in right of payment and of
security with the Revolving Credit Loans, Delayed-Draw Term Loans and all other Term Loans (ii) shall
not mature earlier than the Latest Maturity Date, (iii) shall have interest rates, interest margins, rate floors,
fees, funding discounts, premiums and amortization schedules determined by the Borrower and the
lenders thereof and (iv) may have terms and conditions different from those of the other Term Loans;
provided that, except with respect to the differences set forth in clauses (ii) and (iii) above, any
differences must be reasonably acceptable to the Administrative Agent; provided, further that the Yield
on any tranche of Incremental Term Loans does not exceed the Yield on the initial Term Loans or the
Delayed Draw Term Loans by more than 50 basis points per annum, unless the interest rate on the initial
Term Loans and the Delayed Draw Term Loans, as applicable, is increased on or prior to the date of the
incurrence of such Incremental Term Loans in order to comply with this proviso.
(e) [Reserved].
(f) [Reserved].
(g) Each notice from the Borrower pursuant to this Section 2.14 shall set forth the
requested amount and proposed terms of the relevant Incremental Facility. Incremental Term Loans may
be made, and Incremental Revolving Commitment Increases may be provided, by any existing Lender (it
being understood that (i) no existing Lender will have an obligation to make a portion of any Incremental
Facility and (ii) the Borrower shall have no obligation to offer any existing Lender the opportunity to
provide any such Credit Facility); provided that the Administrative Agent shall have consented (not to be
unreasonably withheld) to such Lenders or Additional Lenders making such Incremental Term Loans or
providing such Incremental Revolving Commitment Increases if such consent would be required under
Section 13.6(b) for an assignment of Loans or Commitments, as applicable, to such Lender or Additional
Lender.
(h) Commitments in respect of Incremental Term Loans and Incremental Revolving
Commitment Increases shall become Commitments (or in the case of an Incremental Revolving
Commitment Increase to be provided by an existing Lender with a Revolving Credit Commitment, an
increase in such Lenders applicable Revolving Credit Commitment) under this Agreement pursuant to an
amendment (an Incremental Amendment) to this Agreement (which shall be substantially in the form
of Exhibit K to this Agreement) and, as appropriate, the other Credit Documents, executed by the
Borrower, each Lender agreeing to provide such Commitment, if any, each Additional Lender, if any, and
the Administrative Agent (notwithstanding any provision to the contrary in Section 13.1 of this
Agreement). The Incremental Amendment may, subject to Section 2.14(c) and (f)) as the case may be,
without the consent of any other Lenders, effect such amendments to this Agreement and the other Credit
Documents as may be necessary, in the reasonable opinion of the Administrative Agent and the Borrower,
to effect the provisions of this Section (notwithstanding any provision to the contrary in Section 13.1 of
this Agreement). The effectiveness of any Incremental Amendment shall be subject to the satisfaction on
the date thereof of the conditions in Section 7.1 and such other conditions as the parties thereto shall
agree. The Borrower may use the proceeds of the Incremental Term Loans and Incremental Revolving
Commitment Increases for any purpose not prohibited by this Agreement.
(i) (i) unless it so agrees, the Borrower shall not be obligated to offer any existing
Lender the opportunity to provide any Incremental Facility. If, on the date of any increase in the
Revolving Credit Commitments pursuant to an Incremental Revolving Commitment Increase, there are
any Revolving Credit Loans outstanding, such Revolving Credit Loans shall on or prior to the
effectiveness of such Incremental Revolving Commitment Increase be prepaid from the proceeds of
additional Revolving Credit Loans made hereunder (reflecting such increase in Revolving Credit
Commitments), which prepayment shall be accompanied by accrued interest on the Revolving Credit

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Loans being prepaid and any costs incurred by any Lender in accordance with Section 2.11. The
Administrative Agent and the Lenders hereby agree that the minimum borrowing, pro rata borrowing and
pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions
effected pursuant to the immediately preceding sentence.
(ii) At the option of the Borrower and the Lenders providing such Incremental
Revolving Commitment Increases, any Incremental Revolving Commitment Increases may be in the form
of one or more separate classes of revolving credit commitments (the New Revolving Credit
Commitments) which shall constitute a separate Class of Commitments from the Revolving Credit
Commitments and/or any other New Revolving Credit Commitments (each such separate Class of New
Revolving Credit Commitments, a New Revolving Credit Series and each Loan thereunder, a New
Revolving Credit Loan) and the related Loans shall constitute a separate Class of Loans from the
Revolving Credit Loans, and/or any other New Revolving Credit Loans (it being understood that New
Revolving Credit Commitments of a single New Revolving Credit Series may be established on more
than one date); provided that:
(A) Each tranche of New Revolving Credit Commitments shall be in an
aggregate principal amount of not less than $100,000,000 (provided that such amount may
be less than $100,000,000 if such amount represents all remaining availability under the
limit set forth in Section 2.14(b) above).
(B) the terms of such New Revolving Credit Commitments, except for (w)
the tenor of the New Revolving Credit Commitments (which shall have a scheduled
expiration date no earlier than the Maturity Date), (x) the size of any letter of credit
subfacilities under such New Revolving Credit Commitments, (y) the applicable interest
rates, interest margins, rate floors, premiums, funding discounts and fees payable with
respect to such New Revolving Credit Commitments and (z) the borrowing, repayment
and termination of Commitment procedures (in each case which shall be as specified in
the applicable Incremental Amendment), shall be similar to the terms of the Revolving
Credit Commitments (unless otherwise consented to by the Administrative Agent);
provided that the Yield on the New Revolving Credit Commitments does not exceed the
Yield on the initial Revolving Credit Commitments by more than 50 basis points, unless
the interest rate on the initial Revolving Credit Commitments is increased on or prior to
the date of the incurrence of such New Revolving Credit Commitments in order to comply
with this proviso.
(C) in connection with the establishment of any New Revolving Credit
Commitments that will include letter of credit subfacilities, any amendment to this
Agreement pursuant to this Section 2.14(i)(ii) may include provisions relating to letters of
credit issued thereunder, which issuances shall be on terms similar (except for the overall
size of such subfacilities and the identity of the letter of credit issuer, and borrowing,
repayment and termination of commitment procedures, in each case which shall be
specified in the applicable Incremental Amendment) to the terms relating to Letters of
Credit with respect to the Revolving Credit Commitments or otherwise reasonably
acceptable to the Administrative Agent and any applicable letter of credit issuer
thereunder.
2.15. [Reserved].
2.16. Defaulting Lenders. Notwithstanding any provision of this Agreement to the
contrary, if any Lender becomes a Defaulting Lender, then for so long as such Lender is a Defaulting

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Lender, fees shall cease to accrue on the unfunded portion of the Commitment of such Defaulting Lender
pursuant to Section 4.1(a). If the Borrower and the Administrative Agent agree in writing in their
discretion that a Lender that is a Defaulting Lender should no longer be deemed to be a Defaulting
Lender, the Administrative Agent will so notify the parties hereto, whereupon, as of the effective date
specified in such notice and subject to any conditions set forth therein, such Lender will cease to be a
Defaulting Lender and will be a Non-Defaulting Lender; provided that, except to the extent otherwise
expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Non-Defaulting
Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lenders
having been a Defaulting Lender.
SECTION 3. Letters of Credit.
3.1. Issuance of Letters of Credit.
(a) General Letters of Credit. (i) Subject to and upon the terms and conditions
herein set forth (including Section 3.8), at any time and from time to time on and after the Closing Date
and prior to the General L/C Termination Date, each General Letter of Credit Issuer agrees to issue upon
the request of the Borrower (x) for the direct or indirect benefit of the Borrower and the Restricted
Subsidiaries and (y) for the direct or indirect benefit of the Ultimate Parent and its other Subsidiaries
(excluding the Oncor Subsidiaries) (in the case of this sub-clause (y), so long as the aggregate Stated
Amount of all Letters of Credit issued by the General Letter of Credit Issuers from the Closing Date for
the Ultimate Parent and its other Subsidiaries benefit does not exceed $50,000,000), a letter of credit or
letters of credit (the General Letters of Credit and each, a General Letter of Credit) in such form
and with such Issuer Documents as may be approved by such General Letter of Credit Issuer in its
reasonable discretion; provided that the Borrower shall be a co-applicant, and jointly and severally liable
with respect to each General Letter of Credit issued for the account of the Ultimate Parent and its
Subsidiaries other than the Borrower; provided further that General Letters of Credit issued for the direct
or indirect benefit of the Ultimate Parent and its other Subsidiaries (excluding the Oncor Subsidiaries)
other than the Borrower and the Restricted Subsidiaries shall be subject to Sections 10.5(b), (g), (i) and/or
(v) and Section 10.12 hereof.
(ii) Notwithstanding the foregoing, (A) no General Letter of Credit shall be issued,
the Stated Amount of which, when added to the General Letters of Credit Outstanding at such
time, would exceed the lesser of (x) the General Letter of Credit Commitment then in effect and
(y) the General L/C Collateral Account Balance, (B) no General Letter of Credit shall be issued
by any General Letter of Credit Issuer the Stated Amount of which, when added to the General
Letters of Credit Outstanding with respect to such General Letter of Credit Issuer, would exceed
the lesser of (x) the Specified General Letter of Credit Commitment of such General Letter of
Credit Issuer then in effect and (y) the General L/C Collateral Account Balance of the relevant
General L/C Collateral Account, (C) each General Letter of Credit shall have an expiration date
occurring no later than the earlier of (x) one year after the date of issuance thereof, unless
otherwise agreed upon by the Administrative Agent and the relevant General Letter of Credit
Issuer or as provided under Section 3.2(b) and (y) the General L/C Termination Date, (D) each
General Letter of Credit shall be denominated in Dollars, (E) no General Letter of Credit shall be
issued if it would be illegal under any Applicable Law for the beneficiary of the General Letter of
Credit to have a General Letter of Credit issued in its favor and (F) no General Letter of Credit
shall be issued after the relevant General Letter of Credit Issuer has received a written notice from
the Borrower or the Administrative Agent or the Required Lenders stating that a Default or an
Event of Default has occurred and is continuing until such time as such General Letter of Credit
Issuer shall have received a written notice (x) of rescission of such notice from the party or
parties originally delivering such notice, (y) of the waiver of such Default or Event of Default in

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accordance with the provisions of Section 13.1 or (z) that such Default or Event of Default is no
longer continuing.
(b) RCT Letters of Credit. (i) Subject to and upon the terms and conditions herein
set forth (including Section 3.9), at any time and from time to time on and after the Closing Date and prior
to the RCT L/C Termination Date, but only if the Borrower shall have theretofore issued and delivered
the RCT Carve Out Support Rejection Notice pursuant to Section 4.4 prior to the Delayed-Draw
Termination Date, each RCT Letter of Credit Issuer agrees to issue upon the request of the Borrower and
for the benefit of the RCT a letter of credit or letters of credit (the RCT Letters of Credit and each, a
RCT Letter of Credit) in such form and with such Issuer Documents as may be approved by such
RCT Letter of Credit Issuer in its reasonable discretion. RCT Letters of Credit shall be used for the
purpose of satisfying bonding requirements of the RCT.
(ii) Notwithstanding the foregoing, (A) no RCT Letter of Credit shall be issued, the
Stated Amount of which, when added to the RCT Letters of Credit Outstanding at such time,
would exceed the lesser of (x) the RCT Letter of Credit Commitment then in effect and (y) the
RCT L/C Collateral Account Balance, (B) no RCT Letter of Credit shall be issued by any RCT
Letter of Credit Issuer the Stated Amount of which, when added to the RCT Letters of Credit
Outstanding with respect to such RCT Letter of Credit Issuer, would exceed the lesser of (x) the
Specified RCT Letter of Credit Commitment of such RCT Letter of Credit Issuer then in effect
and (y) the RCT L/C Collateral Account Balance of the relevant RCT L/C Collateral Account,
(C) each RCT Letter of Credit shall have an expiration date occurring no later than the earlier of
(x) one year after the date of issuance thereof, unless otherwise agreed upon by the
Administrative Agent and the relevant RCT Letter of Credit Issuer or as provided under Section
3.2(b) and (y) the RCT L/C Termination Date, (D) each RCT Letter of Credit shall be
denominated in Dollars, (E) no RCT Letter of Credit shall be issued if it would be illegal under
any Applicable Law for the beneficiary of the RCT Letter of Credit to have a RCT Letter of
Credit issued in its favor and (F) no RCT Letter of Credit shall be issued after the relevant RCT
Letter of Credit Issuer has received a written notice from the Borrower or the Administrative
Agent or the Required Lenders stating that a Default or an Event of Default has occurred and is
continuing until such time as such RCT Letter of Credit Issuer shall have received a written
notice (x) of rescission of such notice from the party or parties originally delivering such notice,
(y) of the waiver of such Default or Event of Default in accordance with the provisions of Section
13.1 or (z) that such Default or Event of Default is no longer continuing.
3.2. Letter of Credit Requests.
(a) Whenever the Borrower desires that a Letter of Credit be issued, the Borrower
shall give the Administrative Agent and the applicable Letter of Credit Issuer a Letter of Credit Request
by no later than 1:00 p.m. (New York City time) at least two (or such lesser number as may be agreed
upon by the Administrative Agent and such Letter of Credit Issuer) Business Days prior to the proposed
date of issuance. Each notice shall be executed by the Borrower, shall specify whether such Letter of
Credit is to be a General Letter of Credit or RCT Letter of Credit and shall be in the form of Exhibit G, or
such other form (including by electronic or fax transmission) as agreed between the Borrower, the
Administrative Agent and the applicable Letter of Credit Issuer (each a Letter of Credit Request).
(b) If the Borrower so requests in any applicable Letter of Credit Request, any Letter
of Credit Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has
automatic extension provisions (each, an Auto-Extension Letter of Credit); provided that any such
Auto-Extension Letter of Credit must permit the Letter of Credit Issuer to prevent any such extension at
least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit)

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by giving prior notice to the beneficiary thereof not later than a day (the Non-Extension Notice Date)
in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by a Letter of Credit Issuer, the Borrower shall not be required to make a specific
request to such Letter of Credit Issuer for any such extension. Once an Auto-Extension Letter of Credit
has been issued, the Borrower shall be deemed to have authorized (but may not require) such Letter of
Credit Issuer to permit the extension of such Letter of Credit at any time to an expiry date not later than,
in the case of any General Letter of Credit, the General L/C Termination Date, and in the case of any RCT
Letter of Credit, the RCT L/C Termination Date; provided, however, that such Letter of Credit Issuer
shall not permit any such extension if (A) such Letter of Credit Issuer has determined that it would not be
permitted, or would have no obligation, at such time to issue such Letter of Credit in its revised form (as
extended) under the terms hereof (by reason of the provisions of clause(ii) of either Sections 3.1(a) or (b),
as applicable or otherwise), or (B) it has received notice (which may be by telephone or in writing) on or
before the day that is five Business Days before the Non-Extension Notice Date from the Administrative
Agent or the Borrower that one or more of the applicable conditions specified in Section 7 are not then
satisfied, and in each such case directing such Letter of Credit Issuer not to permit such extension.
(c) Each Letter of Credit Issuer shall, at least once each month, provide the
Administrative Agent a list of all Letters of Credit issued by it that are outstanding at such time and
specifying whether such Letters of Credit are General Letters of Credit or RCT Letters of Credit; provided
that upon written request from the Administrative Agent, such Letter of Credit Issuer shall thereafter
notify the Administrative Agent in writing on each Business Day of all Letters of Credit issued on the
prior Business Day by such Letter of Credit Issuer and specifying whether such Letters of Credit are
General Letters of Credit or RCT Letters of Credit.
(d) The making of each Letter of Credit Request shall be deemed to be a
representation and warranty by the Borrower that the Letter of Credit may be issued in accordance with,
and will not violate the requirements of, Section 3.1(a)(ii) or Section 3.1(b)(ii), as applicable.
3.3. [Reserved].
3.4. Agreement to Repay Letter of Credit Drawings.
(a) The Borrower hereby agrees to reimburse the applicable Letter of Credit Issuer,
by making payment in Dollars to such Letter of Credit Issuer in immediately available funds, for any
payment or disbursement made by such Letter of Credit Issuer under any Letter of Credit (each such
amount so paid until reimbursed, an Unpaid Drawing) (i) within one Business Day of the date of such
payment or disbursement, if such Letter of Credit Issuer provides notice to the Borrower of such payment
or disbursement prior to 10:00 a.m. (New York City time) on such next succeeding Business Day from
the date of such payment or disbursement or (ii) if such notice is received after such time, on the first
Business Day following the date of receipt of such notice (such required date for reimbursement under
clause (i) or (ii), as applicable, the Reimbursement Date), with interest on the amount so paid or
disbursed by such Letter of Credit Issuer, from and including the date of such payment or disbursement to
but excluding the Reimbursement Date, at the per annum rate for each day equal to the Overnight Rate;
provided that, notwithstanding anything contained in this Agreement to the contrary, (i) in the case of any
Unpaid Drawing under any General Letter of Credit, if the Borrower shall have notified the
Administrative Agent and the relevant General Letter of Credit Issuer that it does not intend to reimburse
the relevant General Letter of Credit Issuer for the amount of such drawing with its own funds, or if the
Borrower has not notified the Administrative Agent and the relevant General Letter of Credit Issuer prior
to 10:00 a.m. (New York City time) on the Reimbursement Date that it intends to reimburse the relevant
General Letter of Credit Issuer for the amount of such drawing with its own funds, in either case the
Collateral Agent shall promptly cause the amounts on deposit in the relevant General L/C Collateral

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Account to be applied to repay in full the amount of such Unpaid Drawing and (ii) in the case of any
payment or disbursement made by any RCT Letter of Credit Issuer under any RCT Letter of Credit, upon
notification by such RCT Letter of Credit Issuer to the Collateral Agent of such payment or disbursement,
the Collateral Agent shall promptly cause the amounts on deposit in the relevant RCT L/C Collateral
Account to be applied to repay in full the amount of such payment or disbursement.
(b) The obligations of the Borrower under this Section 3.4 to reimburse the Letter of
Credit Issuers with respect to Unpaid Drawings (including, in each case, interest thereon) shall be
absolute and unconditional under any and all circumstances and irrespective of any set-off, counterclaim
or defense to payment that the Borrower or any other Person may have or have had against any Letter of
Credit Issuer, the Administrative Agent or any Lender including any defense based upon the failure of
any drawing under a Letter of Credit (each a Drawing) to conform to the terms of the Letter of Credit
or any non-application or misapplication by the beneficiary of the proceeds of such Drawing; provided
that the Borrower shall not be obligated to reimburse any Letter of Credit Issuer for any wrongful
payment made by such Letter of Credit Issuer under the Letter of Credit issued by it as a result of acts or
omissions constituting willful misconduct or gross negligence on the part of such Letter of Credit Issuer.
3.5. Increased Costs. If after the Closing Date, the adoption of any Applicable Law, or
any change therein, or any change in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation or administration thereof, or
actual compliance by a Letter of Credit Issuer with any request or directive made or adopted after the
Closing Date (whether or not having the force of law), by any such authority, central bank or comparable
agency shall either (a) impose, modify or make applicable any reserve, deposit, capital adequacy, liquidity
or similar requirement against letters of credit issued by any Letter of Credit Issuer, or (b) impose on any
Letter of Credit Issuer any other conditions or liabilities affecting its obligations under this Agreement in
respect of Letters of Credit or any Letter of Credit, and the result of any of the foregoing is to increase the
cost to such Letter of Credit Issuer of issuing or maintaining any Letter of Credit, or to reduce the amount
of any sum received or receivable by such Letter of Credit Issuer hereunder (other than any such increase
or reduction attributable to (i) taxes indemnifiable under Section 5.4, or (ii) Excluded Taxes) in respect of
Letters of Credit, then, promptly after receipt of written demand to the Borrower by such Letter of Credit
Issuer (a copy of which notice shall be sent by such Letter of Credit Issuer to the Administrative Agent),
the Borrower shall pay to such Letter of Credit Issuer such additional amount or amounts as will
compensate such Letter of Credit Issuer for such increased cost or reduction, it being understood and
agreed, however, that any Letter of Credit Issuer shall not be entitled to such compensation as a result of
such Persons compliance with, or pursuant to any request or directive to comply with, any such
Applicable Law as in effect on the Closing Date. A certificate submitted to the Borrower by the relevant
Letter of Credit Issuer (a copy of which certificate shall be sent by such Letter of Credit Issuer to the
Administrative Agent), setting forth in reasonable detail the basis for the determination of such additional
amount or amounts necessary to compensate such Letter of Credit Issuer as aforesaid shall be conclusive
and binding on the Borrower absent clearly demonstrable error.
3.6. New or Successor Letter of Credit Issuer.
(a) Any Letter of Credit Issuer may resign as a Letter of Credit Issuer upon 30 days
prior written notice to the Administrative Agent, the Lenders and the Borrower. The Borrower may add
General Letter of Credit Issuers or RCT Letter of Credit Issuers at any time upon notice to the
Administrative Agent. If a Letter of Credit Issuer shall resign or be replaced, or if the Borrower shall
decide to add a new Letter of Credit Issuer under this Agreement, then the Borrower may appoint from
among the Lenders a successor or new issuer of Letters of Credit or, with the consent of the
Administrative Agent (such consent not to be unreasonably withheld), another successor or new issuer of
Letters of Credit, whereupon such successor issuer of Letters of Credit shall succeed to the rights, powers

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and duties of the replaced or resigning Letter of Credit Issuer under this Agreement and the other Credit
Documents, or such new issuer of Letters of Credit shall be granted the rights, powers and duties of a
General Letter of Credit Issuer or RCT Letter of Credit Issuer, as applicable, hereunder, and the term
General Letter of Credit Issuer or RCT Letter of Credit Issuer, as applicable, shall mean such
successor or include such new issuer of Letters of Credit effective upon such appointment. At the time
such resignation or replacement shall become effective, the Borrower shall pay to the resigning or
replaced Letter of Credit Issuer all accrued and unpaid fees owing to such Letter of Credit Issuer pursuant
to Section 4.1(c). The acceptance of any appointment as a Letter of Credit Issuer hereunder whether as a
successor or new issuer of Letters of Credit in accordance with this Agreement, shall be evidenced by an
agreement entered into by such new or successor issuer of Letters of Credit, in a form satisfactory to the
Borrower and the Administrative Agent and, from and after the effective date of such agreement, such
new or successor issuer of Letters of Credit shall become a General Letter of Credit Issuer or RCT
Letter of Credit Issuer, as applicable, hereunder. After the resignation or replacement of a Letter of
Credit Issuer hereunder, the resigning or replaced Letter of Credit Issuer shall remain a party hereto and
shall continue to have all the rights and obligations of a Letter of Credit Issuer under this Agreement and
the other Credit Documents with respect to Letters of Credit issued by it prior to such resignation or
replacement, but shall not be required to issue additional Letters of Credit. In connection with any
resignation or replacement pursuant to this clause (a) (but, in case of any such resignation, only to the
extent that a successor issuer of Letters of Credit shall have been appointed), either (i) the Borrower, the
resigning or replaced Letter of Credit Issuer and the successor issuer of Letters of Credit shall arrange to
have any outstanding Letters of Credit issued by the resigning or replaced Letter of Credit Issuer replaced
with Letters of Credit issued by the successor issuer of Letters of Credit or (ii) the Borrower shall cause
the successor issuer of Letters of Credit, if such successor issuer is satisfactory to the replaced or
resigning Letter of Credit Issuer, to issue back-stop Letters of Credit naming the resigning or replaced
Letter of Credit Issuer as beneficiary for each outstanding Letter of Credit issued by the resigning or
replaced Letter of Credit Issuer, which new Letters of Credit shall have a face amount equal to the Letters
of Credit being back-stopped and the sole requirement for drawing on such new Letters of Credit shall be
a drawing on the corresponding back-stopped Letters of Credit. After any resigning or replaced Letter of
Credit Issuers resignation or replacement as Letter of Credit Issuer, the provisions of this Agreement
relating to a Letter of Credit Issuer shall inure to its benefit as to any actions taken or omitted to be taken
by it (A) while it was a Letter of Credit Issuer under this Agreement or (B) at any time with respect to
Letters of Credit issued by such Letter of Credit Issuer.
(b) To the extent that there are, at the time of any resignation or replacement as set
forth in clause (a) above, any outstanding Letters of Credit, nothing herein shall be deemed to impact or
impair any rights and obligations of any of the parties hereto with respect to such outstanding Letters of
Credit (including, without limitation, any obligations related to the payment of Fees or the reimbursement
or funding of amounts drawn), except that the Borrower, the resigning or replaced Letter of Credit Issuer
and the successor issuer of Letters of Credit shall have the obligations regarding outstanding Letters of
Credit described in clause (a) above.
3.7. Role of Letter of Credit Issuer. Each Lender and the Borrower agree that, in
paying any Drawing under a Letter of Credit, the relevant Letter of Credit Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates and documents expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such
document or the authority of the Person executing or delivering any such document. None of the Letter
of Credit Issuers, the Administrative Agent, any of their respective affiliates nor any correspondent,
participant or assignee of any Letter of Credit Issuer shall be liable to any Lender for (i) any action taken
or omitted in connection herewith at the request or with the approval of the Required Lenders; (ii) any
action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due
execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of

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Credit or Issuer Document. The Borrower hereby assumes all risks of the acts or omissions of any
beneficiary or transferee with respect to its use of any Letter of Credit; provided that this assumption is
not intended to, and shall not, preclude the Borrowers pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. None of the Letter of Credit
Issuers, the Administrative Agent, any of their respective affiliates nor any correspondent, participant or
assignee of any Letter of Credit Issuer shall be liable or responsible for (i) any lack of validity or
enforceability of this Agreement or any of the other Credit Documents, (ii) the existence of any claim,
set-off, defense or other right that the Borrower may have at any time against a beneficiary named in a
Letter of Credit, any transferee of any Letter of Credit (or any Person for whom any such transferee may
be acting), the Administrative Agent, any Letter of Credit Issuer, any Lender or other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions contemplated herein or any
unrelated transactions (including any underlying transaction between the Borrower and the beneficiary
named in any such Letter of Credit), (iii) any draft, certificate or any other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect, (iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit Documents or (v) the occurrence of
any Default or Event of Default; provided that anything in this Section to the contrary notwithstanding,
the Borrower may have a claim against a Letter of Credit Issuer, and such Letter of Credit Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or
exemplary, damages suffered by the Borrower which the Borrower proves were caused by such Letter of
Credit Issuers willful misconduct or gross negligence or such Letter of Credit Issuers willful failure to
pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not
in limitation of the foregoing, each Letter of Credit Issuer may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of any notice or information to
the contrary, and no Letter of Credit Issuer shall be responsible for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective
for any reason.
3.8. General L/C Collateral Account. On or prior to the date of initial issuance of any
General Letters of Credit, the Borrower shall establish under its name one or more General L/C Collateral
Accounts for the purpose of cash collateralizing the Borrowers obligations to any General Letter of
Credit Issuer (including the General Letter of Credit Reimbursement Obligation) and may transfer all or
any portion of the funds in any General L/C Collateral Account to any other General L/C Collateral
Account, subject to the satisfaction of the conditions set forth in this Section 3.8; provided that each
General Letter of Credit Issuer may require that the General L/C Collateral Account Depositary Bank for
the General L/C Collateral Account corresponding to its General L/C Obligations is such General Letter
of Credit Issuer or an Affiliate thereof. The Borrower agrees that at all times, and shall immediately
cause additional funds to be deposited and held in each General L/C Collateral Account from time to time
in order that the General L/C Collateral Account Balance of each General L/C Collateral Account shall at
least equal the General Letters of Credit Outstanding (the General L/C Cash Coverage Requirement)
of the relevant General Letter of Credit Issuer. The Borrower hereby grants to the Collateral Agent, for
the benefit of all General Letter of Credit Issuers, a security interest in the General L/C Collateral
Accounts and all cash and balances therein and all proceeds of the foregoing, as security for the General
L/C Obligations (including the General Letter of Credit Reimbursement Obligation) (and, in addition,
grants a security interest therein, for the benefit of the Secured Parties as collateral security for the other
Obligations; provided that amounts on deposit in any General L/C Collateral Account shall be applied,
first, to repay the corresponding General L/C Obligations (including the General Letter of Credit
Reimbursement Obligation) and, then, to repay all other Obligations, in each case in such order as set
forth in Section 11.19 hereof). Except as expressly provided herein or in any other Credit Document, no

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Person shall have the right to make any withdrawal from any General L/C Collateral Account or to
exercise any right or power with respect thereto; provided that at any time the Borrower shall fail to
reimburse any General Letter of Credit Issuer for any Unpaid Drawing in accordance with Section 3.4(a),
the Borrower hereby absolutely, unconditionally and irrevocably agrees that such General Letter of Credit
Issuer shall be entitled to instruct the Collateral Agent, and the Collateral Agent shall instruct the
applicable depositary bank (each, a General L/C Collateral Account Depositary Bank) of the
applicable General L/C Collateral Account, to withdraw therefrom and pay to the Administrative Agent
for account of such General Letter of Credit Issuer amounts equal to such Unpaid Drawings. Amounts in
any General L/C Collateral Account shall be invested by the applicable General L/C Collateral Account
Depositary Bank in the manner instructed by the Borrower in General L/C Permitted Investments to
which such General L/C Collateral Account Depositary Bank has ready access; provided, however, that
the General L/C Collateral Account Depositary Bank shall determine such investments in General L/C
Permitted Investments during the existence of any Event of Default as long as made in General L/C
Permitted Investments, it being understood and agreed that neither the Borrower nor the General L/C
Collateral Account Depositary Bank nor any other Person may direct the investment of funds in the
General L/C Collateral Account in any assets other than General L/C Permitted Investments. The
Borrower shall bear the risk of loss of principal with respect to any investments in any General L/C
Collateral Account. In addition, the Collateral Agent hereby agrees to instruct each General L/C
Collateral Account Depositary Bank to release and pay to the Borrower amounts (if any) (x) remaining on
deposit in each relevant General L/C Collateral Account after the termination of all General Letter of
Credit Commitments, the termination or cancellation of all General Letters of Credit and the repayment in
full of all outstanding General L/C Obligations and/or (y) as set forth in Section 3.10(a) below. Each
General L/C Collateral Account Depositary Bank shall inform the applicable General L/C Issuer of the
balance in the applicable General L/C Collateral Account upon the request of such General L/C Issuer.
3.9. RCT L/C Collateral Account. On or prior to the date of initial drawing of
Delayed-Draw Term Loans, the Borrower shall establish under its name one or more RCT L/C Collateral
Accounts for the purpose of cash collateralizing the Borrowers obligations to any RCT Letter of Credit
Issuer (including the RCT Letter of Credit Reimbursement Obligation) and may transfer all or any portion
of the funds in any RCT L/C Collateral Account to any other RCT L/C Collateral Account, subject to the
satisfaction of the conditions set forth in this Section 3.9; provided that each RCT Letter of Credit Issuer
may require that the RCT L/C Collateral Account Depositary Bank for the RCT L/C Collateral Account
corresponding to its RCT L/C Obligations is such RCT Letter of Credit Issuer or an Affiliate thereof. The
Borrower agrees that at all times, and shall immediately cause additional funds to be deposited and held in
each RCT L/C Collateral Account from time to time in order that, the RCT L/C Collateral Account
Balance of each RCT L/C Collateral Account shall at least equal the RCT Letters of Credit Outstanding
(the RCT L/C Cash Coverage Requirement) of the relevant RCT Letter of Credit Issuer. The
Borrower hereby grants to the Collateral Agent, for the benefit of all RCT Letter of Credit Issuers, a
security interest in the RCT L/C Collateral Accounts and all cash and balances therein and all proceeds of
the foregoing, as security for the RCT L/C Obligations (including the RCT Letter of Credit
Reimbursement Obligation) (and, in addition, grants a security interest therein, for the benefit of the
Secured Parties as collateral security for the other Obligations; provided that amounts on deposit in any
RCT L/C Collateral Account shall be applied, first, to repay the corresponding RCT L/C Obligations
(including the RCT Letter of Credit Reimbursement Obligation) and, then, to repay all other Obligations,
in each case in such order as set forth in Section 11.19 hereof). Except as expressly provided herein or in
any other Credit Document, no Person shall have the right to make any withdrawal from any RCT L/C
Collateral Account or to exercise any right or power with respect thereto; provided that at any time the
Borrower shall fail to reimburse any RCT Letter of Credit Issuer for any Unpaid Drawing in accordance
with Section 3.4(a), the Borrower hereby absolutely, unconditionally and irrevocably agrees that such
RCT Letter of Credit Issuer shall be entitled to instruct the Collateral Agent, and the Collateral Agent
shall instruct the applicable depositary bank (each, a RCT L/C Collateral Account Depositary Bank)

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of the applicable RCT L/C Collateral Account, to withdraw therefrom and pay to the Administrative
Agent for account of such RCT Letter of Credit Issuer amounts equal to such Unpaid Drawings.
Amounts in any RCT L/C Collateral Account shall be invested by the applicable RCT L/C Collateral
Account Depositary Bank in the manner instructed by the Borrower in RCT L/C Permitted Investments to
which such RCT L/C Collateral Account Depositary Bank has ready access; provided, however, that the
RCT L/C Collateral Account Depositary Bank shall determine such investments in RCT L/C Permitted
Investments during the existence of any Event of Default as long as made in RCT L/C Permitted
Investments, it being understood and agreed that neither the Borrower nor the RCT L/C Collateral
Account Depositary Bank nor any other Person may direct the investment of funds in the RCT L/C
Collateral Account in any assets other than RCT L/C Permitted Investments. The Borrower shall bear the
risk of loss of principal with respect to any investments in any RCT L/C Collateral Account. In addition,
the Collateral Agent hereby agrees to instruct each RCT L/C Collateral Account Depositary Bank to
release and pay to the Borrower amounts (if any) (x) remaining on deposit in each relevant RCT L/C
Collateral Account after the termination of all RCT Letter of Credit Commitments, the termination or
cancellation of all RCT Letters of Credit and the repayment in full of all outstanding RCT L/C
Obligations and/or (y) as set forth in Section 3.10(b) below. Each RCT L/C Collateral Account
Depositary Bank shall inform the applicable RCT L/C Issuer of the balance in the applicable RCT L/C
Collateral Account upon the request of such RCT L/C Issuer.
3.10. Drawings from General L/C Collateral Accounts and RCT L/C Collateral
Accounts.
(a) At any time and from time to time (other than during the existence of an Event of
Default), upon at least two (2) Business Days prior written notice to the Collateral Agent, the
Administrative Agent, the relevant General Letter of Credit Issuer and the relevant General L/C Collateral
Account Depositary Bank, the Borrower may draw amounts in any General L/C Collateral Account,
provided, however, that after giving effect to any such drawing, the General L/C Cash Coverage
Requirement shall be satisfied. For the avoidance of doubt, the conditions set forth in Sections 6 and 7 of
this Agreement will not be applicable to any withdrawals made pursuant to this Section 3.10(a) or the last
sentence of Section 3.8.
(b) At any time and from time to time (other than during the existence of an Event of
Default), upon at least two (2) Business Days prior written notice to the Collateral Agent, the
Administrative Agent, the relevant RCT Letter of Credit Issuer and the relevant RCT L/C Collateral
Account Depositary Bank, the Borrower may draw amounts in any RCT L/C Collateral Account,
provided, however, that (x) after giving effect to any such drawing, the RCT L/C Cash Coverage
Requirement shall be satisfied (y) such drawn amounts may not be used for any purpose other than
prepaying the Term Loans or the Delayed-Draw Term Loans in accordance with Section 5.1. For the
avoidance of doubt, the conditions set forth in Sections 6 and 7 of this Agreement will not be applicable
to any withdrawals made pursuant to this Section 3.10(b) or the last sentence of Section 3.9.
3.11. Applicability of ISP and UCP. Unless otherwise expressly agreed by the relevant
Letter of Credit Issuer and the Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall
apply to each Standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International Chamber of Commerce at the time
of issuance, shall apply to each Commercial Letter of Credit, and in each case to the extent not
inconsistent with the above referred rules, the laws of the State of New York shall apply to each Letter of
Credit.
3.12. Conflict with Issuer Documents. In the event of any conflict between the terms
hereof and the terms of any Issuer Document, the terms hereof shall control.

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3.13. Letters of Credit Issued for Others. Notwithstanding that a Letter of Credit issued
or outstanding hereunder is in support of any obligations of, or is for the account of, the Ultimate Parent
or its Subsidiaries other than the Borrower, the Borrower shall be obligated to reimburse the relevant
Letter of Credit Issuer hereunder for any and all drawings under such Letter of Credit. The Borrower
hereby acknowledges that the issuance of Letters of Credit for the account of the Ultimate Parent or its
Subsidiaries other than the Borrower inures to the benefit of the Borrower, and that the Borrowers
business derives substantial benefits from the businesses of the Ultimate Parent and its Subsidiaries other
than the Borrower.
SECTION 4. Fees; Commitments.
4.1. Fees.
(a) The Borrower agrees to pay to the Administrative Agent in Dollars, for the
account of each Revolving Credit Lender (in each case pro rata according to the respective Revolving
Credit Commitments of all such Lenders), a commitment fee (the Revolving Credit Commitment
Fee) for each day from the Closing Date to, but excluding, the Maturity Date. The Revolving Credit
Commitment Fee shall be payable by the Borrower (x) quarterly in arrears on the tenth Business Day
following the end of each March, J une, September and December (for the three-month period (or portion
thereof) ended on such day for which no payment has been received) and (y) on the Revolving Credit
Termination Date, (for the period ended on such date for which no payment has been received pursuant to
clause (x) above) and shall be computed for each day during such period at a rate per annum equal to the
Revolving Credit Commitment Fee Rate on the applicable portion of the Available Revolving
Commitment in effect on such day.
(b) [Reserved].
(c) The Borrower agrees to pay to each Letter of Credit Issuer a fee in respect of
each Letter of Credit issued by it (the Fronting Fee), for the period from the date of issuance of such
Letter of Credit to the termination date of such Letter of Credit, computed at the rate for each day equal to
0.25% per annum on the average daily Stated Amount of such Letter of Credit (or at such other rate per
annum as agreed in writing between the Borrower and such Letter of Credit Issuer). Such Fronting Fees
shall be due and payable by the Borrower (x) quarterly in arrears on the tenth Business Day following the
end of each March, J une, September and December and (y) on the later of (A) the Maturity Date and (B)
the day on which the General Letters of Credit Outstanding or RCT Letters of Credit Outstanding, as
applicable, shall have been reduced to zero (0).
(d) The Borrower agrees to pay directly to the Letter of Credit Issuer upon each
issuance of, drawing under, and/or amendment of, a Letter of Credit issued by it such amount as the
Letter of Credit Issuer and the Borrower shall have agreed upon for issuances of, drawings under or
amendments of, letters of credit issued by it.
(e) The Borrower agrees to pay to the Administrative Agent in Dollars, for the
account of each Lender holding a Delayed-Draw Term Loan Commitment, a fee equal to 50% of the
Applicable LIBOR Margin calculated on the Available Delayed-Draw Term Loan Commitment of such
Lenders (the Delayed-Draw Ticking Fee) for each day from (and including) the date that is sixty (60)
days following the Closing Date until (but excluding) the Delayed-Draw Termination Date. The
Delayed-Draw Ticking Fee shall be payable by the Borrower quarterly in arrears on the tenth Business
Day following the end of each March, J une, September and December (for the three-month period (or
portion thereof) ended on such day for which no payment has been received and (y) on the Delayed Draw
Termination Date (for the period ended on such date for which no payment has been received pursuant to

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clause (x) above), and shall be computed for each day during such period on the applicable portion of the
Delayed-Draw Term Loan Commitment in effect on such day.
(f) The Borrower agrees to pay directly to the Administrative Agent for its own
account the administrative agent fees as set forth in the Fee Letter.
(g) Notwithstanding the foregoing, the Borrower shall not be obligated to pay any
amounts to any Defaulting Lender pursuant to this Section 4.1.
4.2. Voluntary Reduction of Revolving Credit Commitments and Delayed-Draw Term
Loan Commitments.
(a) Upon at least one Business Days prior written notice (or telephonic notice
promptly confirmed in writing) to the Administrative Agent at the Administrative Agents Office (which
notice the Administrative Agent shall promptly transmit to each of the Revolving Credit Lenders), the
Borrower shall have the right, without premium or penalty, on any day, permanently to terminate or
reduce the Revolving Credit Commitments in whole or in part; provided that (a) any such termination or
reduction of Revolving Credit Commitments shall apply proportionately and permanently to reduce the
Total Revolving Credit Commitment on a pro rata basis as between each of the Revolving Credit
Lenders, (b) any partial reduction pursuant to this Section 4.2 shall be in the amount of at least the
Minimum Borrowing Amount and (c) after giving effect to such termination or reduction and to any
prepayments of the Revolving Credit Loans made on the date thereof in accordance with this Agreement
(including pursuant to Section 5.2(b)), the aggregate amount of the Revolving Credit Lenders Revolving
Credit Exposures shall not exceed the Total Revolving Credit Commitment.
(b) Upon at least one Business Days prior written notice (or telephonic notice
promptly confirmed in writing) to the Administrative Agent at the Administrative Agents Office (which
notice the Administrative Agent shall promptly transmit to each of the Delayed-Draw Term Loan
Lenders), the Borrower shall have the right, without premium or penalty, on any day, permanently to
terminate or reduce the Delayed-Draw Term Loan Commitments in whole or in part; provided that (a) any
such termination or reduction of Delayed-Draw Term Loan Commitments shall apply proportionately and
permanently to reduce the Total Delayed-Draw Term Loan Commitment on a pro rata basis as between
each of the Delayed-Draw Term Loan Lenders and (b) any partial reduction pursuant to this Section 4.2
shall be in the amount of at least $50,000,000.
(c) Upon at least one Business Days prior written notice (or telephonic notice
promptly confirmed in writing) to the Administrative Agent and the RCT Letter of Credit Issuers, the
reduce the RCT Letter of Credit Commitment in whole or in part; provided that, after giving effect to
such termination or reduction, (i) the RCT Letters of Credit Outstanding shall not exceed the RCT Letter
of Credit Commitment, (ii) the RCT Letters of Credit Outstanding with respect to each RCT Letter of
Credit Issuer shall not exceed the Specified RCT Letter of Credit Commitment of such RCT Letter of
Credit Issuer and (iii) the RCT L/C Cash Coverage Requirement shall be satisfied.
(d) Upon at least one Business Days prior written notice (or telephonic notice
promptly confirmed in writing) to the Administrative Agent and the General Letter of Credit Issuers, the
reduce the General Letter of Credit Commitment in whole or in part; provided that, after giving effect to
such termination or reduction, (i) the General Letters of Credit Outstanding shall not exceed the General
Letter of Credit Commitment, (ii) the General Letters of Credit Outstanding with respect to each General

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Letter of Credit Issuer shall not exceed the Specified General Letter of Credit Commitment of such
General Letter of Credit Issuer and (iii) the General L/C Cash Coverage Requirement shall be satisfied.
4.3. Mandatory Termination of Commitments.
(a) The Delayed-Draw Term Loan Commitment shall terminate at 5:00 p.m. (New
York City time) on the Delayed-Draw Termination Date.
(b) The Total Revolving Credit Commitment shall terminate at 5:00 p.m. (New York
City time) on the Maturity Date.
4.4. RCT Carve Out Support Rejection Notice.
If the RCT denies or rejects the TCEH Debtors application to utilize the RCT
Reclamation Support Carve Out to satisfy the RCTs bonding requirements, then the Borrower shall be
obligated to promptly terminate the RCT Reclamation Support Carve Out by issuing and delivering a
notice in writing to the Administrative Agent (the RCT Carve Out Support Rejection Notice). Upon
issuance and delivery by the Borrower of the RCT Carve Out Support Rejection Notice to the
Administrative Agent, immediately, automatically and without further action, the RCT Reclamation
Support Carve Out will terminate and be permanently reduced to $0 for all purposes hereunder and under
the Orders, and the RCT shall thereafter cease to have any rights in respect of the RCT Reclamation
Support Carve Out. Except as set forth in this Section 4.4, the Borrower may not terminate the RCT
Reclamation Support Carve Out.
SECTION 5. Payments.
5.1. Voluntary Prepayments. The Borrower shall have the right to prepay Term
Loans, Delayed-Draw Term Loans and Revolving Credit Loans, without premium or penalty, in whole or
in part, from time to time on the following terms and conditions: (a) the Borrower shall give the
Administrative Agent at the Administrative Agents Office written notice (or telephonic notice promptly
confirmed in writing) of its intent to make such prepayment, the amount of such prepayment and, in the
case of LIBOR Loans, the specific Borrowing(s) pursuant to which made, which notice shall be given by
the Borrower no later than 1:00 p.m. (New York City time) (x) one Business Day prior to (in the case of
ABR Loans) or (y) three Business Days prior to (in the case of LIBOR Loans), the date of such
prepayment and shall promptly be transmitted by the Administrative Agent to each of the relevant
Lenders, (b) each partial prepayment of any Borrowing of Term Loans, Delayed-Draw Term Loans or
Revolving Credit Loans shall be in a multiple of $1,000,000 and in an aggregate principal amount of at
least $5,000,000; provided that no partial prepayment of LIBOR Loans made pursuant to a single
Borrowing shall reduce the outstanding LIBOR Loans made pursuant to such Borrowing to an amount
less than the Minimum Borrowing Amount for LIBOR Loans and (c) any prepayment of LIBOR Loans
pursuant to this Section 5.1 on any day other than the last day of an Interest Period applicable thereto shall
be subject to compliance by the Borrower with the applicable provisions of Section 2.11. Each
prepayment in respect of any tranche of Term Loans or Delayed-Draw Term Loans pursuant to this
Section 5.1 shall be applied to the Class or Classes of Term Loans or Delayed Draw Term Loans in such
manner as the Borrower may determine. All prepayments under this Section 5.1 shall also be subject to
the provisions of Section 5.2(d) or (e), as applicable. At the Borrowers election in connection with any
prepayment pursuant to this Section 5.1, such prepayment shall not be applied to any Loan of a
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5.2. Mandatory Prepayments.
(a) Loan Prepayments. On each occasion that a Prepayment Event occurs, the
Borrower shall, within three Business Days after the occurrence of such Prepayment Event (or, in the case
of Deferred Net Cash Proceeds, within three Business Days after the Deferred Net Cash Proceeds
Payment Date), prepay (subject to Section 11.19 when applicable), in accordance with clauses (c)and (d)
below, Loans in a principal amount equal to 100% of the Net Cash Proceeds from such Prepayment
Event.
(b) Repayment of Revolving Credit Loans. Subject to Section 11.19 when
applicable, if on any date the aggregate amount of the Lenders Revolving Credit Exposures (collectively,
the Aggregate Revolving Credit Outstandings) for any reason exceeds 100% of the Total Revolving
Credit Commitment then in effect (or, prior to the Full Availability Date, the Interim Availability
Amount), the Borrower shall, forthwith repay within two (2) Business Days of such date the principal
amount of any Revolving Credit Loans in an amount necessary to eliminate such deficiency.
(c) Application to Repayments. Subject to Section 11.19 when applicable, each
prepayment of Loans required by Section 5.2(a) shall be allocated (i) first, to the Term Loans and any
Incremental Term Loans in direct order of maturity until paid in full, (ii) to any Delayed-Draw Term
Loans then outstanding in direct order of maturity until paid in full, and (iii) thereafter, to the Revolving
Credit Facility (without any permanent reduction in commitments thereof).
(d) Application to Term Loans and Delayed-Draw Term Loans. With respect to
each prepayment of Term Loans and Delayed-Draw Term Loans elected to be made by the Borrower
pursuant to Section 5.1 or required by Section 5.2(a), subject to Section 11.19 when applicable, the
Borrower may designate the Types of Loans that are to be prepaid and the specific Borrowing(s) pursuant
to which made; provided that the Borrower pays any amounts, if any, required to be paid pursuant to
Section 2.11 with respect to prepayments of LIBOR Loans made on any date other than the last day of the
applicable Interest Period. In the absence of a designation by the Borrower as described in the preceding
sentence, the Administrative Agent shall, subject to the above, make such designation in its reasonable
discretion with a view, but no obligation, to minimize breakage costs owing under Section 2.11.
(e) Application to Revolving Credit Loans. With respect to each prepayment of
Revolving Credit Loans elected to be made by the Borrower pursuant to Section 5.1 or required by
Section 5.2(a) or (b), the Borrower may designate (i) the Types of Loans that are to be prepaid and the
specific Borrowing(s) pursuant to which made and (ii) the Revolving Credit Loans to be prepaid;
provided that (x) each prepayment of any Loans made pursuant to a Borrowing shall be applied pro rata
among such Loans; and (y) notwithstanding the provisions of the preceding clause (x), no prepayment
made pursuant to Section 5.1 or 5.2 of Revolving Credit Loans shall be applied to the Revolving Credit
Loans of any Defaulting Lender. In the absence of a designation by the Borrower as described in the
preceding sentence, the Administrative Agent shall, subject to the above, make such designation in its
reasonable discretion with a view, but no obligation, to minimize breakage costs owing under Section
2.11.
(f) LIBOR Interest Periods. In lieu of making any payment pursuant to this
Section 5.2 in respect of any LIBOR Loan other than on the last day of the Interest Period therefor so long
as no Event of Default shall have occurred and be continuing, the Borrower at its option may deposit with
the Administrative Agent an amount equal to the amount of the LIBOR Loan to be prepaid and such
LIBOR Loan shall be repaid on the last day of the Interest Period therefor in the required amount. Such
deposit shall be held by the Administrative Agent in a corporate time deposit account established on terms
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accounts of such type. Such deposit shall constitute cash collateral for the LIBOR Loans to be so prepaid;
provided that the Borrower may at any time direct that such deposit be applied to make the applicable
payment required pursuant to this Section 5.2.
(g) Minimum Amount. No prepayment shall be required pursuant to Section 5.2(a)
(i) in the case of any Prepayment Event yielding Net Cash Proceeds of less than $5,000,000 in the
aggregate and (ii) unless and until the amount at any time of Net Cash Proceeds from Prepayment Events
required to be applied at or prior to such time pursuant to such Section and not yet applied at or prior to
such time to prepay Term Loans or Delayed-Draw Term Loans pursuant to such Section exceeds
(x) $25,000,000 for a single Prepayment Event or (y) $100,000,000 in the aggregate for all Prepayment
Events (other than those that are either under the threshold specified in subclause (i) or over the threshold
specified in subclause (ii)(x)) in any one fiscal year, at which time all such Net Cash Proceeds referred to
in this subclause (ii) with respect to such fiscal year shall be applied as a prepayment in accordance with
this Section 5.2.
(h) [Reserved].
(i) Foreign Net Cash Proceeds. Notwithstanding any other provisions of this
Section 5.2, (i) to the extent that any or all of the Net Cash Proceeds from a Recovery Prepayment Event
(a Foreign Recovery Event) of, or any Disposition by, a Restricted Foreign Subsidiary giving rise to
an Asset Sale Prepayment Event (a Foreign Asset Sale) are prohibited or delayed by applicable local
law from being repatriated to the United States, such portion of the Net Cash Proceeds so affected will not
be required to be applied to repay Term Loans or Delayed-Draw Term Loans at the times provided in this
Section 5.2 but may be retained by the applicable Restricted Foreign Subsidiary so long, but only so long,
as the applicable local law will not permit repatriation to the United States (the Borrower hereby agreeing
to cause the applicable Restricted Foreign Subsidiary to promptly take all actions required by the
applicable local law to permit such repatriation), and once such repatriation of any of such affected Net
Cash Proceeds is permitted under the applicable local law, such repatriation will be immediately effected
and such repatriated Net Cash Proceeds will be promptly (and in any event not later than two Business
Days after such repatriation) applied (net of additional taxes payable or reserved against as a result
thereof) to the repayment of the Term Loans or Delayed-Draw Term Loans as required pursuant to this
Section 5.2 and (ii) to the extent that the Borrower has determined in good faith that repatriation of any of
or all the Net Cash Proceeds of any Foreign Recovery Event on any Foreign Asset Sale would have a
material adverse tax consequence with respect to such Net Cash Proceeds, the Net Cash Proceeds so
affected may be retained by the applicable Restricted Foreign Subsidiary; provided that, in the case of this
clause (ii), on or before the date on which any Net Cash Proceeds so retained would otherwise have been
required to be applied to reinvestments or prepayments pursuant to Section 5.2(a), (x) the Borrower
applies an amount equal to such Net Cash Proceeds to such reinvestments or prepayments as if such Net
Cash Proceeds had been received by the Borrower rather than such Restricted Foreign Subsidiary, less the
amount of additional taxes that would have been payable or reserved against if such Net Cash Proceeds
had been repatriated (or, if less, the Net Cash Proceeds that would be calculated if received by such
Foreign Subsidiary) or (y) such Net Cash Proceeds are applied to the repayment of Indebtedness of a
Restricted Foreign Subsidiary.
5.3. Method and Place of Payment.
(a) Except as otherwise specifically provided herein, all payments under this
Agreement shall be made by the Borrower without set-off, counterclaim or deduction of any kind, to the
Administrative Agent for the ratable account of the Lenders entitled thereto or the Letter of Credit Issuer
entitled thereto, as the case may be, not later than 2:00 p.m. (New York City time), in each case, on the
date when due and shall be made in immediately available funds at the Administrative Agents Office or

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at such other office as the Administrative Agent shall specify for such purpose by notice to the Borrower,
it being understood that written or facsimile notice by the Borrower to the Administrative Agent to make
a payment from the funds in the Borrowers account at the Administrative Agents Office shall constitute
the making of such payment to the extent of such funds held in such account. All repayments or
prepayments of any Loans (whether of principal, interest or otherwise) hereunder and all other payments
under each Credit Document shall be made in Dollars. The Administrative Agent will thereafter cause to
be distributed on the same day (if payment was actually received by the Administrative Agent prior to
2:00 p.m. (New York City time) or, otherwise, on the next Business Day) like funds relating to the
payment of principal or interest or fees ratably to the Lenders entitled thereto.
(b) Any payments under this Agreement that are made later than 2:00 p.m. (New
York City time) shall be deemed to have been made on the next succeeding Business Day. Whenever any
payment to be made hereunder shall be stated to be due on a day that is not a Business Day, the due date
thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal,
interest shall be payable during such extension at the applicable rate in effect immediately prior to such
extension.
5.4. Net Payments.
(a) Any and all payments made by or on behalf of the Borrower or any Guarantor
under this Agreement or any other Credit Document shall be made free and clear of, and without
deduction or withholding for or on account of, any Indemnified Taxes; provided that if the Borrower or
any Guarantor or the Administrative Agent shall be required by Applicable Law to deduct or withhold
any Indemnified Taxes from such payments, then (i) the sum payable by the Borrower or any Guarantor
shall be increased as necessary so that after making all required deductions and withholdings (including
deductions or withholdings applicable to additional sums payable under this Section 5.4) the
Administrative Agent, the Collateral Agent or any Lender (which term shall include each Letter of Credit
Issuer for purposes of Section 5.4 and for the purposes of the definition of Excluded Taxes), as the case
may be, receives an amount equal to the sum it would have received had no such deductions or
withholdings been made, (ii) the Borrower or such Guarantor or the Administrative Agent shall make
such deductions or withholdings and (iii) the Borrower or such Guarantor or the Administrative Agent
shall timely pay the full amount deducted or withheld to the relevant Governmental Authority within the
time allowed and in accordance with Applicable Law. Whenever any Indemnified Taxes are payable by
the Borrower or such Guarantor, as promptly as possible thereafter, the Borrower or Guarantor shall send
to the Administrative Agent for its own account or for the account of such Lender, as the case may be, a
certified copy of an original official receipt (or other evidence acceptable to such Lender, acting
reasonably) received by the Borrower or such Guarantor showing payment thereof.
(b) The Borrower shall timely pay and shall indemnify and hold harmless the
Administrative Agent, the Collateral Agent and each Lender with regard to any Other Taxes (whether or
not such Other Taxes were correctly or legally imposed or asserted by the relevant Governmental
Authority).
(c) The Borrower shall indemnify and hold harmless the Administrative Agent, the
Collateral Agent and each Lender within fifteen Business Days after written demand therefor, for the full
amount of any Indemnified Taxes imposed on the Administrative Agent, the Collateral Agent or such
Lender as the case may be, on or with respect to any payment by or on account of any obligation of the
Borrower or any Guarantor hereunder or under any other Credit Document (including Indemnified Taxes
imposed or asserted on or attributable to amounts payable under this Section 5.4) and any reasonable out-
of-pocket expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate setting

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forth reasonable detail as to the amount of such payment or liability delivered to the Borrower by a
Lender, the Administrative Agent or the Collateral Agent (as applicable) on its own behalf or on behalf of
a Lender shall be conclusive absent manifest error.
(d) Any Non-U.S. Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which the Borrower is resident for tax purposes, or
under any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any
other Credit Document shall, to the extent it is legally able to do so, deliver to the Borrower (with a copy
to the Administrative Agent), at the time or times prescribed by Applicable Law or reasonably requested
by the Borrower or the Administrative Agent, such properly completed and executed documentation
prescribed by Applicable Law as will permit such payments to be made without withholding or at a
reduced rate of withholding. A Lenders obligation under the prior sentence shall apply only if the
Borrower or the Administrative Agent has made a request for such documentation. In addition, any
Lender, if requested by the Borrower or the Administrative Agent shall deliver such other documentation
prescribed by Applicable Law or reasonably requested by the Borrower or the Administrative Agent as
will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject
to backup withholding or information reporting requirements.
(e) Each Non-U.S. Lender with respect to any Loan made to the Borrower shall, to
the extent it is legally entitled to do so:
(i) deliver to the Borrower and the Administrative Agent, prior to the date on which
the first payment to the Non-U.S. Lender is due hereunder, two copies of (x) in the case of a Non-
U.S. Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or
881(c) of the Code with respect to payments of portfolio interest, United States Internal
Revenue Service Form W-8BEN (together with a certificate substantially in the form of Exhibit L
representing that such Non-U.S. Lender is not a bank for purposes of Section 881(c) of the Code,
is not a 10-percent shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of the
Borrower, any interest payment received by such Non-U.S. Lender under this Agreement or any
other Credit Document is not effectively connected with the conduct of a trade or business in the
United States and is not a controlled foreign corporation related to the Borrower (within the
meaning of Section 864(d)(4) of the Code)), (y) Internal Revenue Service Form W-8BEN or
Form W-8ECI, in each case properly completed and duly executed by such Non-U.S. Lender
claiming complete exemption from, or reduced rate of, U.S. Federal withholding tax on payments
by the Borrower under this Agreement or (z) if a Non-U.S. Lender does not act or ceases to act
for its own account with respect to any portion of any sums paid or payable to such Lender under
any of the Credit Documents (for example, in the case of a typical participation or where Non-
U.S. Lender is a pass through entity) Internal Revenue Service Form W-8IMY and all necessary
attachments (including the forms described in clauses (x) and (y) above, as required); and
(ii) deliver to the Borrower and the Administrative Agent two further copies of any
such form or certification (or any applicable successor form) on or before the date that any such
form or certification expires or becomes obsolete and after the occurrence of any event requiring
a change in the most recent form previously delivered by it to the Borrower.
If in any such case any Change in Law has occurred prior to the date on which any such delivery would
otherwise be required that renders any such form inapplicable or would prevent such Non-U.S. Lender
from duly completing and delivering any such form with respect to it, such Non-U.S. Lender shall
promptly so advise the Borrower and the Administrative Agent.

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(f) If any Lender, the Administrative Agent or the Collateral Agent, as applicable,
determines, in its sole discretion exercised in good faith, that it had received and retained a refund of an
Indemnified Tax (including an Other Tax) for which a payment has been made by the Borrower pursuant
to this Agreement, which refund in the good faith judgment of such Lender, the Administrative Agent or
the Collateral Agent, as the case may be, is attributable to such payment made by the Borrower, then the
Lender, the Administrative Agent or the Collateral Agent, as the case may be, shall reimburse the
Borrower for such amount (net of all out-of-pocket expenses of such Lender, the Administrative Agent or
the Collateral Agent, as the case may be, and without interest other than any interest received thereon
from the relevant Governmental Authority with respect to such refund) as the Lender, Administrative
Agent or the Collateral Agent, as the case may be, determines in its sole discretion exercised in good faith
to be the proportion of the refund as will leave it, after such reimbursement, in no better or worse position
(taking into account expenses or any taxes imposed on the refund) than it would have been in if the
payment had not been required; provided that the Borrower, upon the request of the Lender, the
Administrative Agent or the Collateral Agent, agrees to repay the amount paid over to the Borrower (plus
any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Lender,
the Administrative Agent or the Collateral Agent in the event the Lender, the Administrative Agent or the
Collateral Agent is required to repay such refund to such Governmental Authority. A Lender, the
Administrative Agent or the Collateral Agent shall claim any refund that it determines is available to it,
unless it concludes in its sole discretion that it would be adversely affected by making such a claim.
Neither the Lender, the Administrative Agent nor the Collateral Agent shall be obliged to disclose any
information regarding its tax affairs or computations to any Credit Party in connection with this clause (f)
or any other provision of this Section 5.4.
(g) If the Borrower determines that a reasonable basis exists for contesting a Tax,
each Lender or Agent, as the case may be, shall use reasonable efforts to cooperate with the Borrower as
the Borrower may reasonably request in challenging such Tax. Subject to the provisions of Section 2.12,
each Lender and Agent agrees to use reasonable efforts to cooperate with the Borrower as the Borrower
may reasonably request to minimize any amount payable by the Borrower or any Guarantor pursuant to
this Section 5.4. The Borrower shall indemnify and hold each Lender and Agent harmless against any
out-of-pocket expenses incurred by such Person in connection with any request made by the Borrower
pursuant to this Section 5.4(g). Nothing in this Section 5.4(g) shall obligate any Lender or Agent to take
any action that such Person, in its sole judgment, determines may result in a material detriment to such
Person.
(h) Each Lender with respect to any Loan made to the Borrower that is a United
States person under Section 7701(a)(30) of the Code and each Agent (each, a U.S. Lender) shall
deliver to the Borrower and the Administrative Agent two United States Internal Revenue Service Forms
W-9 (or substitute or successor form), properly completed and duly executed, certifying that such Lender
or Agent is exempt from United States backup withholding (i) on or prior to the Closing Date (or on or
prior to the date it becomes a party to this Agreement), (ii) on or before the date that such form expires or
becomes obsolete, (iii) after the occurrence of a change in such Agents or Lenders circumstances
requiring a change in the most recent form previously delivered by it to the Borrower and the
Administrative Agent and (iv) from time to time thereafter if reasonably requested by the Borrower or the
(i) If a payment made to any Lender would be subject to U.S. federal withholding
Tax imposed under FATCA if such Lender were to fail to comply with the applicable reporting
requirements of FATCA (including those contained in Sections 1471(b) or 1472(b) of the Code, as
applicable), such Lender shall deliver to the Borrower and the Administrative Agent, at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower or the Agent, such
documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the

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Code) and such other documentation reasonably requested by the Administrative Agent and the Borrower
as may be necessary for the Administrative Agent and the Borrower to comply with their obligations
under FATCA, to determine whether such Lender has or has not complied with such Lenders FATCA
obligations and to determine the amount, if any, to deduct and withhold from such payment. Solely for
purposes of this subsection (i), FATCA shall include any amendments after the date of this Agreement.
(j) The agreements in this Section 5.4 shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
5.5. Computations of Interest and Fees.
(a) Except as provided in the next succeeding sentence, interest on LIBOR Loans,
and ABR Loans shall be calculated on the basis of a 360-day year for the actual days elapsed. Interest on
ABR Loans in respect of which the rate of interest is calculated on the basis of the Administrative Agents
prime rate and interest on overdue interest shall be calculated on the basis of a 365- (or 366-, as the case
may be) day year for the actual days elapsed.
(b) Fees and the average daily Stated Amount of Letters of Credit shall be calculated
on the basis of a 360-day year for the actual days elapsed.
5.6. Limit on Rate of Interest.
(a) No Payment Shall Exceed Lawful Rate. Notwithstanding any other term of this
Agreement, the Borrower shall not be obligated to pay any interest or other amounts under or in
connection with this Agreement or otherwise in respect of the Obligations in excess of the amount or rate
permitted under or consistent with any applicable law, rule or regulation.
(b) Payment at Highest Lawful Rate. If the Borrower is not obliged to make a
payment that it would otherwise be required to make, as a result of Section 5.6(a), the Borrower shall
make such payment to the maximum extent permitted by or consistent with applicable laws, rules and
regulations.
(c) Adjustment if Any Payment Exceeds Lawful Rate. If any provision of this
Agreement or any of the other Credit Documents would obligate the Borrower to make any payment of
interest or other amount payable to any Lender in an amount or calculated at a rate that would be
prohibited by any Applicable Law, then notwithstanding such provision, such amount or rate shall be
deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the
case may be, as would not be so prohibited by Applicable Law, such adjustment to be effected, to the
extent necessary, by reducing the amount or rate of interest required to be paid by the Borrower to the
affected Lender under Section 2.8.
(d) Spreading. In determining whether the interest hereunder is in excess of the
amount or rate permitted under or consistent with any Applicable Law, the total amount of interest shall
be spread throughout the entire term of this Agreement until its payment in full.
(e) Notwithstanding the foregoing, and after giving effect to all adjustments
contemplated thereby, if any Lender shall have received from the Borrower an amount in excess of the
maximum permitted by any Applicable Law, then the Borrower shall be entitled, by notice in writing to
the Administrative Agent to obtain reimbursement from that Lender in an amount equal to such excess,
and pending such reimbursement, such amount shall be deemed to be an amount payable by that Lender
to the Borrower.

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SECTION 6. Conditions Precedent to Initial Borrowing.
The initial Borrowing under this Agreement is subject to the satisfaction of the following
conditions precedent, except as otherwise agreed between the Borrower and the Administrative Agent.
6.1. Credit Documents. The Administrative Agent shall have received:
(a) this Agreement, executed and delivered by a duly authorized officer of Parent
Guarantor, the Borrower, each Agent, each Lender and each Letter of Credit Issuer;
(b) the Guarantee, executed and delivered by a duly authorized officer of each
Guarantor as of the Closing Date; and
(c) the Security Agreement, executed and delivered by a duly authorized officer of
each party thereto as of the Closing Date.
6.2. Collateral.
(a) All outstanding Stock of the Borrower directly owned by Parent Guarantor and
all Stock of each Subsidiary of the Borrower directly owned by the Borrower or any Subsidiary
Guarantor, in each case, as of the Closing Date, shall have been pledged pursuant to the Interim Order
(except that such Credit Parties shall not be required to pledge any Excluded Stock and Stock
Equivalents).
(b) All Indebtedness of the Borrower and each Subsidiary of the Borrower that is
owing to the Borrower or a Subsidiary Guarantor (other than indebtedness of a Foreign Subsidiary that is
owing to the Borrower or a Subsidiary Guarantor), to the extent exceeding $10,000,000 in aggregate
principal amount, shall have been pledged pursuant to the Interim Order.
(c) All documents and instruments, including Uniform Commercial Code or other
applicable personal property and financing statements, reasonably requested by the Collateral Agent to be
filed, registered or recorded to create the Liens intended to be created by any Security Document to be
executed on the Closing Date and perfect such Liens to the extent required by, and with the priority
required by, such Security Document shall have been delivered to the Collateral Agent in proper form for
filing, registration or recording and none of the Collateral shall be subject to any other pledges, security
interests or mortgages, except for Liens permitted hereunder; provided, however, that notwithstanding
anything to the contrary contained in this Agreement or in any other Credit Document, but without
limiting the grant of a Lien on and security interest in the Collateral pursuant to the Orders and the
Security Documents, the TCEH Debtors will not be obligated to enter into any mortgages (including a
Mortgage), authorize any fixture filing, enter into any agreement requiring control as defined in Section
9-104, 9-105, 9-106 and 9-107 of the UCC as in effect in any relevant jurisdiction) or to undertake any
registration in respect of assets subject to a certificate of title.
(d) [Reserved].
(e) The Guarantee shall be in full force and effect.
(f) [Reserved].
6.3. Legal Opinions. The Administrative Agent shall have received the executed legal
opinions (which legal opinion will address customary matters for a debtor-in-possession financing) of

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(a) Kirkland & Ellis LLP, special New York counsel to Parent Guarantor and the Borrower, and (b)
Gibson, Dunn & Crutcher LLP, special Texas counsel to Parent Guarantor and the Borrower, in each
case, in form and substance reasonably acceptable to the Administrative Agent. Parent Guarantor, the
Borrower, the other Credit Parties and the Administrative Agent hereby instruct such counsel to deliver
such legal opinions.
6.4. Initial Budget. The Borrower shall have delivered the Initial Budget to the
Administrative Agent and the Lenders, which shall be in form and substance reasonably satisfactory to the
Administrative Agent and the J oint Lead Arrangers, and the Administrative Agent and the J oint Lead
Arrangers hereby confirm the receipt of the Initial Budget dated April 24, 2014 in form and substance
reasonably satisfactory to the Administrative Agent and the J oint Lead Arrangers prior to the date hereof.
6.5. [Reserved].
6.6. Closing Certificates. The Administrative Agent shall have received a certificate
of the Credit Parties, dated the Closing Date, substantially in the form of Exhibit H, with appropriate
insertions, executed by an Authorized Officer of each Credit Party, and attaching the documents referred
to in Section 6.7.
6.7. Authorization of Proceedings of Each Credit Party. The Administrative Agent
shall have received (a) a copy of the resolutions of the board of directors, other managers or general
partner of each Credit Party (or a duly authorized committee thereof) authorizing (i) the execution,
delivery and performance of the Credit Documents (and any agreements relating thereto) to which it is a
party and (ii) in the case of the Borrower, the extensions of credit contemplated hereunder and (b) true and
complete copies of the Organizational Documents of each Credit Party as of the Closing Date.
6.8. Fees. The Agents shall have received the fees in the amounts previously agreed in
writing by the Agents to be received on the Closing Date and all expenses (including the reasonable fees,
disbursements and other charges of any Advisors) payable by the Credit Parties for which invoices have
been presented prior to the Closing Date shall have been paid.
6.9. Representations and Warranties. On the Closing Date, the representations and
warranties made by the Credit Parties in Section 8, shall be true and correct in all material respects (or in
all respects for representations and warranties qualified by materiality or Material Adverse Effect).
6.10. Interim Order. The Interim Order, in form and substance satisfactory to the Left
Lead Arrangers, shall have been entered by the Bankruptcy Court in the Cases, upon motion in form and
substance satisfactory to the Left Lead Arrangers, by the Bankruptcy Court in the Cases no later than ten
(10) Business Days after the date of commencement of the Cases and shall be in full force and effect and
shall not have been reversed, modified, amended, stayed or vacated, in the case of any modification or
amendment, in a manner that is adverse to the Lenders, without the consent of the Left Lead Arrangers.
The TCEH Debtors shall be in compliance in all material respects with the Interim Order.
6.11. First Day Orders. The Left Lead Arrangers shall have received evidence of the
entry of all First Day Orders, which shall be reasonably satisfactory in form and substance to the Left Lead
Arrangers (but in the case of the Interim Cash Collateral Order, the Cash Management Order and the
Interim Order, in form and substance satisfactory to the Left Lead Arrangers), and which First Day Orders
shall have been received by the Left Lead Arrangers.

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6.12. Trustees and Examiners. No trustee or examiner with enlarged powers (having
powers beyond those set forth in Bankruptcy Code sections 1106(a)(3) and (4)) shall have been appointed
with respect to the operations or the business of the TCEH Debtors.
6.13. Projections. The Administrative Agent and the Lenders shall have received a base
case model, including a statement of cash sources and uses of all free cash flow of the TCEH Debtors for
the tenor of the Credit Facilities, which shall be in form and substance reasonably satisfactory to the
Administrative Agent and the J oint Lead Arrangers, and the Administrative Agent and the J oint Lead
Arrangers hereby confirm the receipt of a base case model dated April 24, 2014 in form and substance
reasonably satisfactory to the Administrative Agent and the J oint Lead Arrangers prior to the date hereof.
6.14. Patriot Act. The J oint Lead Arrangers shall have received at least 5 days prior to
the Closing Date such documentation and information as is reasonably requested in writing at least 10
days prior to the Closing Date by the Administrative Agent about Parent Guarantor, the Borrower and the
Subsidiary Guarantors mutually agreed to be required by U.S. regulatory authorities under applicable
know your customer and anti-money laundering rules and regulations, including, without limitation, the
Patriot Act.
6.15. Petition Date. The Petition Date shall have occurred.
6.16. Restructuring Support Agreement. [The Restructuring Support Agreement shall
have been duly executed by the Credit Parties and each other party thereto, all conditions to the
effectiveness of the Restructuring Support Agreement shall have been satisfied or waived and the
Restructuring Support Agreement shall be in full force and effect, subject to any necessary Bankruptcy
Court approvals.]
6.17. Restructuring Documents. [The Disclosure Statement, Acceptable Reorganization
Plan, [the Plan Related Documents (as defined in the Restructuring Support Agreement)] and other
material definitive documents with respect to the Cases, in each case, as applicable and in form and
[substance reasonably satisfactory to the Administrative Agent (provided, however, that with respect to
provisions of the Disclosure Statement or Acceptable Reorganization Plan that relate to the payment of
the Credit Facilities, such provisions must be in form and substance satisfactory to the Administrative
Agent)] shall have been filed in the Cases and the solicitation for the Acceptable Reorganization Plan
shall have been commenced.]
For purposes of determining compliance with the conditions specified in this Section 6 on
the Closing Date, each Agent and each Lender that has signed this Agreement shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to such Agent or Lender unless
the Borrower shall have received notice from such Agent or Lender (or from the Administrative Agent on
behalf of such Lender) prior to the proposed Closing Date specifying its objection thereto, but excluding
for the avoidance of doubt any subsequent changes or modifications to such documents or matters made
after release of such partys signature page.
SECTION 7. Conditions Precedent to All Credit Events.
(a) The agreement of each Lender to make any Loan requested to be made by it on any
date, and the obligation of any Letter of Credit Issuer to issue Letters of Credit on any date, is subject to
the satisfaction of the conditions precedent set forth in the following Sections 7.1 and 7.2; (b) the
obligation of each Lender to make Loans hereunder and of each Letter of Credit Issuer to issue Letters of
Credit hereunder in an aggregate amount in excess of the Interim Availability Amount shall not become

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effective until the date on which each of the conditions in Section 7.3 is satisfied; and (c) the obligation of
each Lender to make Delayed-Draw Term Loans hereunder and of each RCT Letter of Credit Issuer to
issue RCT Letters of Credit hereunder shall not become effective until the date on which each of the
conditions in Section 7.4 is satisfied.
7.1. No Default; Representations and Warranties. At the time of each Credit Event
and also after giving effect thereto (a) no Default or Event of Default shall have occurred and be
continuing and (b) all representations and warranties made by any Credit Party contained herein or in the
other Credit Documents shall be true and correct in all material respects with the same effect as though
such representations and warranties had been made on and as of the date of such Credit Event (except
where such representations and warranties expressly relate to an earlier date, in which case such
representations and warranties shall have been true and correct in all material respects as of such earlier
date).
7.2. Notice of Borrowing.
(a) Prior to the making of each Term Loan, the Administrative Agent shall have
received a Notice of Borrowing (whether in writing or by telephone) meeting the requirements of Section
2.3.
(b) Prior to the making of each Delayed-Draw Term Loan, the Administrative Agent
shall have received a Notice of Borrowing (whether in writing or by telephone) meeting the requirements
of Section 2.3.
(c) Prior to the making of each Revolving Credit Loan, the Administrative Agent
shall have received a Notice of Borrowing (whether in writing or by telephone) meeting the requirements
of Section 2.3.
(d) Prior to the issuance of each General Letter of Credit, the Administrative Agent
and the General Letter of Credit Issuer shall have received a Letter of Credit Request meeting the
requirements of Section 3.2(a).
(e) Prior to the issuance of each RCT Letter of Credit, the Administrative Agent and
the RCT Letter of Credit Issuer shall have received a Letter of Credit Request meeting the requirements
of Section 3.2(a).
(f) The Interim Order or the Final Order, as the case may be, shall be in full force
and effect.
7.3. Full Availability.
(a) [Reserved].
(b) Orders. (i) The Interim Order shall be in full force and effect and shall not have
been stayed, reversed, vacated, modified or amended, in the case of any modification or amendment, in a
manner adverse to the interests (taken as a whole) of the Lenders without the consent of the Left Lead
Arrangers; (ii) the Left Lead Arrangers shall have received a certified copy of the Final Order, in form
and substance satisfactory to the Left Lead Arrangers, which, in any event, shall have been entered by the
Bankruptcy Court, upon motion in form and substance satisfactory to the Left Lead Arrangers, no later
than forty-five (45) days after the Interim Order Entry Date (or such later date agreed to by the Required
Lenders in their sole discretion) and at the time of any such extension of credit the Final Order shall be in

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full force and effect, and shall not have been stayed, reversed, vacated, modified or amended, in the case
of any modification or amendment, in a manner that is adverse to the interests (taken as a whole) of the
Lenders without the prior written consent of the Left Lead Arrangers; and (iii) if either the Interim Order
or the Final Order is the subject of a pending appeal in any respect, none of the making of such extensions
of credit, the grant of Liens and Superpriority Claims as set forth in Section 8.17 and the performance by
the Borrower or any Guarantor of any of their respective obligations under any of the Credit Documents
shall be the subject of a then effective stay. The TCEH Debtors shall be in compliance with the Final
Order.
(c) (i) No Default or Event of Default shall have occurred and be continuing and (ii)
all representations and warranties made by any Credit Party contained herein or in the other Credit
Documents shall be true and correct in all material respects with the same effect as though such
representations and warranties had been made on and as of such date (except where such representations
and warranties expressly relate to an earlier date, in which case such representations and warranties shall
have been true and correct in all material respects as of such earlier date).
(d) The Agents shall have received the fees in the amounts previously agreed in
writing by the Agents to be received on or prior to such date and all expenses (including the reasonable
fees, disbursements and other charges of any Advisors) payable by the Credit Parties for which invoices
have been presented prior to such date shall have been paid
(e) The Administrative Agent shall have received a copy of, or a certificate as to
coverage under, the insurance policies required by Section 9.3 and the applicable provisions of the
Security Documents, each of which shall be endorsed or otherwise amended to name the Collateral
Agent, on behalf of the Secured Parties, as loss payee and, solely if available from the relevant
insurance company in respect of the Collateral perfected pursuant to the Orders, as mortgagee under
any casualty insurance policies, and the Secured Parties, as additional insureds, under any liability
insurance policies.
7.4. Availability of Delayed-Draw Term Loans and RCT Letters of Credit. The RCT
Carve Out Support Rejection Notice shall have been issued and delivered (a) prior to the Delayed-Draw
Termination Date and (b) prior to the making of such Delayed-Draw Term Loans or the issuance of such
RCT Letters of Credit.
The acceptance of the benefits of each Credit Event shall constitute a representation and warranty by each
Credit Party to each of the Lenders that all the applicable conditions specified in Section 7 above have
been satisfied or waived as of that time.
SECTION 8. Representations, Warranties and Agreements.
In order to induce the Lenders and the Letter of Credit Issuers to enter into this
Agreement, to make the Loans and issue or participate in Letters of Credit as provided for herein, each of
Parent Guarantor and the Borrower makes (on the Closing Date and on each other date as required or
otherwise set forth in this Agreement) the following representations and warranties to, and agreements
with, the Lenders and the Letter of Credit Issuers, all of which shall survive the execution and delivery of
this Agreement, the making of the Loans and the issuance of the Letters of Credit:
8.1. Corporate Status; Compliance with Laws. Each of Parent Guarantor, the
Borrower and each Material Subsidiary of the Borrower that is a Restricted Subsidiary (a) is a duly
organized and validly existing corporation or other entity in good standing (as applicable) under the laws
of the jurisdiction of its organization and has the corporate or other organizational power and authority to

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own its property and assets and to transact the business in which it is engaged, (b) has duly qualified and
is authorized to do business and is in good standing (if applicable) in all jurisdictions where it is required
to be so qualified, except where the failure to be so qualified could not reasonably be expected to result in
a Material Adverse Effect and (c) is in compliance with all Applicable Laws, except to the extent that the
failure to be in compliance could not reasonably be expected to result in a Material Adverse Effect.
8.2. Corporate Power and Authority. Subject to the entry of the Orders and the terms
thereof, each Credit Party has the corporate or other organizational power and authority to execute,
deliver and carry out the terms and provisions of the Credit Documents to which it is a party and has
taken all necessary corporate or other organizational action to authorize the execution, delivery and
performance of the Credit Documents to which it is a party. Each Credit Party has duly executed and
delivered each Credit Document to which it is a party and, subject to the entry of the Orders and the terms
thereof, each such Credit Document constitutes the legal, valid and binding obligation of such Credit
Party enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization and other similar laws relating to or affecting creditors rights generally and
general principles of equity (whether considered in a proceeding in equity or law).
8.3. No Violation. Subject to the entry of the Orders and the terms thereof, neither the
execution, delivery or performance by any Credit Party of the Credit Documents to which it is a party nor
the compliance with the terms and provisions thereof will (a) contravene any applicable provision of any
material Applicable Law (including material Environmental Laws), (b) result in any breach of any of the
terms, covenants, conditions or provisions of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien upon any of the property or assets of Parent
Guarantor, the Borrower or any Restricted Subsidiary (other than Liens created under the Credit
Documents, Permitted Liens or Liens securing any of the Prepetition Debt) pursuant to the terms of any
material indenture, loan agreement, lease agreement, mortgage, deed of trust or other material agreement
or instrument to which Parent Guarantor, the Borrower or any Restricted Subsidiary is a party or by which
it or any of its property or assets is bound, in each case to the extent any such agreement was entered into
after the Petition Date (any such term, covenant, condition or provision, a Contractual Requirement)
other than any such breach, default or Lien that could not reasonably be expected to result in a Material
Adverse Effect, or (c) violate any provision of the Organizational Documents of Parent Guarantor, the
Borrower or any Restricted Subsidiary.
8.4. Litigation. Other than the Cases, except as set forth on Schedule 8.4, there are no
actions, suits or proceedings (including Environmental Claims) pending or, to the knowledge of the
Borrower, threatened with respect to Parent Guarantor, the Borrower or any of the Restricted Subsidiaries
that could reasonably be expected to result in a Material Adverse Effect.
8.5. Margin Regulations. Neither the making of any Loan hereunder nor the use of the
proceeds thereof will violate the provisions of Regulation T, U or X of the Board.
8.6. Governmental Approvals. Subject to the entry of the Orders and the terms
thereof, the execution, delivery and performance of the Credit Documents does not require any consent or
approval of, registration or filing with, or other action by, any Governmental Authority, except for
(i) such as have been obtained or made and are in full force and effect, (ii) filings and recordings in
respect of the Liens created pursuant to the Security Documents and (iii) such consents, approvals,
registrations, filings or actions the failure of which to obtain or make could not reasonably be expected to
have a Material Adverse Effect.

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8.7. Investment Company Act. None of the Credit Parties is an investment company
within the meaning of, and subject to registration under, the Investment Company Act of 1940, as
amended.
8.8. True and Complete Disclosure. None of the written factual information and
written data (taken as a whole) heretofore or contemporaneously furnished by or on behalf of Parent
Guarantor, the Borrower, any of the Subsidiaries of the Borrower or any of their respective authorized
representatives to the Administrative Agent, any J oint Lead Arranger and/or any Lender on or before the
Closing Date (including all such information and data contained in the Credit Documents) for purposes of
or in connection with this Agreement or any transaction contemplated herein contained any untrue
statement of any material fact or omitted to state any material fact necessary to make such information
and data (taken as a whole) not materially misleading at such time in light of the circumstances under
which such information or data was furnished, it being understood and agreed that for purposes of this
Section 8.8, such factual information and data shall not include projections or estimates (including
financial estimates, forecasts and other forward-looking information) and information of a general
economic or general industry nature.
8.9. Financial Condition; Projections; Material Adverse Effect.
(a) The Borrower has heretofore furnished to the Lenders the consolidated balance
sheet and statements of earnings, shareholders equity and cash flows of the Borrower as of and for the
fiscal year ended December 31, 2013, reported on by Deloitte & Touche LLP, an independent registered
public accounting firm; provided that if such consolidated balance sheet and statement of earnings,
shareholders equity and cash flows have not been filed with the SEC on or prior to the Closing Date,
then the Borrower has heretofore furnished to the Lenders the consolidated balance sheet and statements
of earnings, shareholders equity and cash flows of the Borrower as of and for the fiscal year ended
December 31, 2012, reported on by Deloitte & Touche LLP, and the unaudited consolidated balance sheet
and statement of earnings, shareholders equity and cash flows of the Borrower as of and for the fiscal
quarters and the portions of the fiscal year ended March 31, 2013, June 30, 2013 and September 30, 2013.
Such financial statements present fairly, in all material respects, the financial position and results of
operations and cash flows of the Borrower and its consolidated subsidiaries as of such date and for such
period in accordance with GAAP consistently applied (except to the extent provided in the notes thereto).
(b) The projections, forward-looking statements, estimates and pro forma financial
information contained in this Agreement, any other Credit Document or any other document, certificate or
statement furnished to any Agent, any J oint Lead Arranger or any Lenders (including, without limitation,
each Budget and Annual Operating Forecast) are based upon good faith estimates and assumptions
believed by the Borrower to be reasonable at the time made, it being recognized by the Agents, J oint Lead
Arrangers and the Lenders that such projections, forward-looking statements, estimates and pro forma
financial information are not to be viewed as facts and are subject to material contingencies and
assumptions, many of which are beyond the control of the Credit Parties, and that actual results during the
period or periods covered by any such projections, forward-looking statements, estimates and pro forma
financial information may differ materially from the projected results.
(c) There has been no Material Adverse Effect since the Petition Date.
8.10. Tax Matters. Except where the failure of which could not be reasonably expected
to have a Material Adverse Effect, (a) each of Parent Guarantor, the Borrower and each of the Restricted
Subsidiaries has filed all federal income Tax returns and all other Tax returns, domestic and foreign,
required to be filed by it and has paid all material Taxes payable by it that have become due (whether or
not shown on such Tax return), other than those (i) not yet delinquent or (ii) contested in good faith as to

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which adequate reserves have been provided to the extent required by law and in accordance with GAAP,
(b) each of Parent Guarantor, the Borrower and each of the Restricted Subsidiaries has provided adequate
reserves in accordance with GAAP for the payment of, all federal, state, provincial and foreign Taxes not
yet due and payable and (c) each of Parent Guarantor, the Borrower and each of the Restricted
Subsidiaries has satisfied all of its Tax withholding obligations.
8.11. Compliance with ERISA.
(a) Each Employee Benefit Plan is in compliance with ERISA, the Code and any
Applicable Law; no Reportable Event has occurred (or is reasonably likely to occur) with respect to any
Plan; no Multiemployer Plan is insolvent or in reorganization (or is reasonably likely to be insolvent or in
reorganization), and no written notice of any such insolvency or reorganization has been given to the
Borrower or any ERISA Affiliate; no Plan has an accumulated or waived funding deficiency (or is
reasonably likely to have such a deficiency); on and after the effectiveness of the Pension Act, each Plan
has satisfied the minimum funding standards (within the meaning of Section 412 of the Code or Section
302 of ERISA) applicable to such Plan, and there has been no determination that any such Plan is, or is
expected to be, in at risk status (within the meaning of Section 4010(d)(2) of ERISA); none of the
Borrower or any ERISA Affiliate has incurred (or is reasonably likely to incur) any liability to or on
account of a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201 or 4204 of
ERISA or Section 4971 or 4975 of the Code; no proceedings have been instituted (or are reasonably
likely to be instituted) to terminate or to reorganize any Plan or to appoint a trustee to administer any
Plan, and no written notice of any such proceedings has been given to the Borrower or any ERISA
Affiliate; and no Lien imposed under the Code or ERISA on the assets of the Borrower or any ERISA
Affiliate exists (or is reasonably likely to exist) nor has the Borrower or any ERISA Affiliate been
notified in writing that such a Lien will be imposed on the assets of the Ultimate Parent, Parent Guarantor,
the Borrower or any ERISA Affiliate on account of any Plan, except to the extent that a breach of any of
the representations, warranties or agreements in this Section 8.11(a) would not result, individually or in
the aggregate, in an amount of liability that would be reasonably likely to have a Material Adverse Effect.
No Plan has an Unfunded Current Liability that would, individually or when taken together with any
other liabilities referenced in this Section 8.11(a), be reasonably likely to have a Material Adverse Effect.
With respect to Plans that are Multiemployer Plans, the representations and warranties in this Section
8.11(a), other than any made with respect to (i) liability under Section 4201 or 4204 of ERISA or (ii)
liability for termination or reorganization of such Multiemployer Plans under ERISA, are made to the best
knowledge of the Borrower.
(b) All Foreign Plans are in compliance with, and have been established,
administered and operated in accordance with, the terms of such Foreign Plans and Applicable Law,
except for any failure to so comply, establish, administer or operate the Foreign Plans as would not
reasonably be expected to have a Material Adverse Effect. All contributions or other payments which are
due with respect to each Foreign Plan have been made in full and there are no funding deficiencies
thereunder, except to the extent any such events would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
8.12. Subsidiaries. Schedule 8.12 lists each Subsidiary of Parent Guarantor (and the
direct and indirect ownership interest of Parent Guarantor therein), in each case existing on the Closing
Date. Each Material Subsidiary as of the Closing Date has been so designated on Schedule 8.12.
8.13. Intellectual Property. Each of Parent Guarantor, the Borrower and the Restricted
Subsidiaries has good and marketable title to, or a valid license or right to use, all patents, trademarks,
servicemarks, trade names, copyrights and all applications therefor and licenses thereof, and all other
intellectual property rights, free and clear of all Liens (other than Liens permitted by Section 10.2), that

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are necessary for the operation of their respective businesses as currently conducted, except where the
failure to have any such title, license or rights could not reasonably be expected to have a Material
Adverse Effect.
8.14. Environmental Laws. Except as could not reasonably be expected to have a
Material Adverse Effect: (a) Parent Guarantor, the Borrower and the Restricted Subsidiaries and all Real
Estate are in compliance with all Environmental Laws; (b) Parent Guarantor, the Borrower and the
Restricted Subsidiaries have, and have timely applied for renewal of, all permits under Environmental
Law to construct and operate their facilities as currently constructed; (c) except as set forth on
Schedule 8.4, neither Parent Guarantor, the Borrower nor any Restricted Subsidiary is subject to any
pending or, to the knowledge of the Borrower, threatened Environmental Claim or any other liability
under any Environmental Law including any such Environmental Claim or, to the knowledge of the
Borrower, any other liability under Environmental Law related to, or resulting from the business or
operations of any predecessor in interest of any of them; (d); neither Parent Guarantor, the Borrower nor
any Restricted Subsidiary is conducting or financing or is required to conduct or finance, any
investigation, removal, remedial or other corrective action pursuant to any Environmental Law at any
location; (e) to the knowledge of the Borrower, no Hazardous Materials have been released into the
environment at, on or under any Real Estate currently owned or leased by Parent Guarantor, the Borrower
or any Restricted Subsidiary and (f) neither Parent Guarantor, the Borrower nor any Restricted Subsidiary
has treated, stored, transported, released or disposed or arranged for disposal or transport for disposal of
Hazardous Materials at, on, under or from any currently or, to the knowledge of the Borrower, formerly
owned or leased Real Estate or facility.
8.15. Properties. Except as set forth on Schedule 8.15, Parent Guarantor, the Borrower
and the Restricted Subsidiaries have good and indefeasible title to or valid leasehold or easement interests
or other license or use rights in all properties that are necessary for the operation of their respective
businesses as currently conducted, free and clear of all Liens (other than any Liens permitted by this
Agreement) and except where the failure to have such good title, leasehold or easement interests or other
license or use rights could not reasonably be expected to have a Material Adverse Effect.
8.16. Orders. The Interim Order is (and the Final Order when entered will be) effective
to create in favor of the Collateral Agent, for the benefit of the Secured Parties, a legal, valid, binding and
enforceable perfected security interest in the Collateral and the proceeds and products thereof without the
necessity of the execution of mortgages, security agreements, pledge agreements, financing statements or
other agreements or documents.
8.17. Status of Obligations; Perfection and Priority of Security Interests. The
Obligations are, subject to the Carve Out, the RCT Reclamation Support Carve Out and the Orders:
(a) upon entry of the Interim Order, and pursuant to the Interim Order and the Final
Order, allowed administrative expense claims in the Cases, having priority over any and all administrative
expense claims, diminution claims, unsecured claims, and all other claims against each of the Borrower,
Parent Guarantor and each other Guarantor or their estates, now existing or hereafter arising, of any kind
or nature whatsoever, including, without limitation, administrative expenses of the kinds specified in, or
ordered pursuant to, sections 105, 326, 328, 330, 331, 365, 503(a), 503(b), 506(c) (subject only to, and
effective upon entry of, the Final Order), 507(a), 507(b), 546(c), 546(d), 726, 1113, and 1114 of the
Bankruptcy Code, and any other provision of the Bankruptcy Code or otherwise, as provided under
section 364(c)(1) of the Bankruptcy Code;
(b) after the entry of the Interim Order and pursuant to the Interim Order and the
Final Order, as applicable, secured by a valid and perfected Lien with the priority provided in

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Section 14.1(a) on all of the Collateral, subject to the Carve Out and the RCT Reclamation Support Carve
Out; and
(c) notwithstanding the provisions of section 362 of the Bankruptcy Code and
subject to the applicable provisions of the Interim Order or the Final Order, as applicable, upon the
Maturity Date (whether by acceleration or otherwise) of any of the Obligations, the Administrative Agent
and Lenders shall be entitled to immediate payment of such Obligations in cash and to enforce the
remedies provided for hereunder or under applicable law, without further application to or order by the
Bankruptcy Court, subject to the terms of the Credit Documents and the Interim Order and the Final
Order.
8.18. Insurance. The properties of Parent Guarantor, the Borrower and the Restricted
Subsidiaries are insured pursuant to self-insurance arrangements or with insurance companies that the
Borrower believes (in the good faith judgment of the management of the Borrower, as applicable) are
financially sound and responsible, in at least such amounts (after giving effect to any self-insurance which
the Borrower believes (in the good faith judgment of management of the Borrower, as applicable) is
reasonable and prudent in light of the size and nature of its business) and against at least such risks (and
with such risk retentions) as the Borrower believes (in the good faith judgment of management of the
Borrower, as applicable) is reasonable and prudent in light of the size and nature of its business.
8.19. Labor Matters. Except as, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect: (a) there are no strikes or other labor disputes against any Parent
Guarantor, the Borrower or any Restricted Subsidiary pending or, to the knowledge of the Borrower,
threatened in writing; and (b) hours worked by and payment made to employees of Parent Guarantor, the
Borrower and each Restricted Subsidiary have not been in violation of the Fair Labor Standards Act or
any other applicable Requirement of Law dealing with such matters.
8.20. Sanctioned Persons; Anti-Corruption Laws; Patriot Act. None of Parent
Guarantor, the Borrower or any of its Subsidiaries or any of their respective directors or officers is subject
to any economic embargoes or similar sanctions administered or enforced by the U.S. Department of
State or the U.S. Department of Treasury (including the Office of Foreign Assets Control) or any other
applicable sanctions authority (collectively, Sanctions, and the associated laws, rules, regulations and
orders, collectively, Sanctions Laws). Each of Parent Guarantor, the Borrower and its Subsidiaries and
their respective directors and officers is in compliance, in all material respects, with (i) all Sanctions
Laws, (ii) the United States Foreign Corrupt Practices Act of 1977, as amended, and any other applicable
anti-bribery or anti-corruption laws, rules, regulations and orders (collectively, Anti-Corruption
Laws) and (iii) the Patriot Act and any other applicable terrorism and money laundering laws, rules,
regulations and orders. No part of the proceeds of the Loans or Letters of Credit will be used, directly or
indirectly, (A) for the purpose of financing any activities or business of or with any Person or in any
country or territory that at such time is the subject of any Sanctions or (B) for any payments to any
governmental official or employee, political party, official of a political party, candidate for political
office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain
any improper advantage, in violation of any Anti-Corruption Law.
SECTION 9. Affirmative Covenants.
The Borrower hereby covenants and agrees that on the Closing Date and thereafter, until
all Commitments and all Letters of Credit have terminated (unless such Letters of Credit have been
collateralized on terms and conditions reasonably satisfactory to the applicable Letter of Credit Issuer
following the termination of the Revolving Credit Commitments) and the Loans and Unpaid Drawings,
together with interest, fees and all other Obligations (other than Hedging Obligations under Secured

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under Secured Cash Management Agreements or Contingent Obligations), are paid in full:
9.1. Information Covenants. The Borrower will furnish to the Administrative Agent
(which shall promptly make such information available to the Lenders in accordance with its customary
practice):
(a) Annual Financial Statements. As soon as available and in any event on or before
the date on which such financial statements are required to be filed with the SEC (after giving effect to
any permitted extensions) (or, if such financial statements are not required to be filed with the SEC, on or
before the date that is 90 days after the end of each such fiscal year), the consolidated balance sheet of
(x) the Borrower and its consolidated Subsidiaries and (y) if different, the Borrower and the Restricted
Subsidiaries (provided, however, that the Borrower shall be under no obligation to deliver the
consolidated financial statements described in sub-clause (y) if the Consolidated Total Assets and the
Consolidated EBITDA of the Borrower and its consolidated Subsidiaries (which Consolidated Total
Assets and Consolidated EBITDA shall be calculated in accordance with the definitions of such terms,
but determined based on the financial information of the Borrower and its consolidated Subsidiaries, and
not the financial information of the Borrower and its Restricted Subsidiaries) do not differ from the
Consolidated Total Assets and the Consolidated EBITDA, respectively, of the Borrower and its Restricted
Subsidiaries by more than 2.5%), in each case as at the end of such fiscal year, and the related
consolidated statements of operations and cash flows for such fiscal year, setting forth comparative
consolidated figures for the preceding fiscal years (or, unless the consolidated financial statements
described in sub-clause (y) are not required to be delivered pursuant to the immediately preceding
proviso, in lieu of such audited financial statements of the Borrower and the Restricted Subsidiaries, a
detailed reconciliation, reflecting such financial information for the Borrower and the Restricted
Subsidiaries, on the one hand, and the Borrower and its consolidated Subsidiaries, on the other hand), all
in reasonable detail and prepared in accordance with GAAP, and, in each case, (i) except with respect to
any such reconciliation, certified by independent certified public accountants of recognized national
standing whose opinion shall not be qualified as to the scope of audit, (ii) certified by an Authorized
Officer of the Borrower as fairly presenting in all material respects the financial condition, results of
operations, stockholders equity and cash flows of the Borrower and its consolidated Subsidiaries (or the
Borrower and the Restricted Subsidiaries, as the case may be) in accordance with GAAP and
(iii) accompanied by a Narrative Report with regard thereto.
(b) Quarterly Financial Statements. As soon as available and in any event on or
before the date on which such financial statements are required to be filed with the SEC (after giving
effect to any permitted extensions) with respect to each of the first three quarterly accounting periods in
each fiscal year of the Borrower (or, if such financial statements are not required to be filed with the SEC,
on or before the date that is 45 days after the end of each such quarterly accounting period), the
consolidated balance sheets of (x) the Borrower and its consolidated Subsidiaries and (y) if different, the
Borrower and the Restricted Subsidiaries (provided, however, that the Borrower shall be under no
obligation to deliver the consolidated financial statements described in sub-clause (y) if the Consolidated
Total Assets and the Consolidated EBITDA of the Borrower and its consolidated Subsidiaries (which
Consolidated Total Assets and Consolidated EBITDA shall be calculated in accordance with the
definitions of such terms, but determined based on the financial information of the Borrower and its
consolidated Subsidiaries, and not the financial information of the Borrower and its Restricted
Subsidiaries) do not differ from the Consolidated Total Assets and the Consolidated EBITDA,
respectively, of the Borrower and its Restricted Subsidiaries by more than 2.5%), in each case as at the
end of such quarterly period and the related consolidated statements of operations for such quarterly
accounting period and for the elapsed portion of the fiscal year ended with the last day of such quarterly
period, and the related consolidated statement of cash flows for such quarterly accounting period and for

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the elapsed portion of the fiscal year ended with the last day of such quarterly period, and setting forth
comparative consolidated figures for the related periods in the prior fiscal year or, in the case of such
consolidated balance sheet, for the last day of the prior fiscal year (or, unless the consolidated financial
statements described in sub-clause (y) are not required to be delivered pursuant to the immediately
preceding proviso, in lieu of such unaudited financial statements of the Borrower and the Restricted
Subsidiaries, a detailed reconciliation reflecting such financial information for the Borrower and the
Restricted Subsidiaries, on the one hand, and the Borrower and its consolidated Subsidiaries, on the other
hand), all of which shall be (i) certified by an Authorized Officer of the Borrower as fairly presenting in
all material respects the financial condition, results of operations, stockholders equity and cash flows of
the Borrower and its consolidated Subsidiaries (or the Borrower and the Restricted Subsidiaries, as the
case may be) in accordance with GAAP, subject to changes resulting from audit, normal year-end audit
adjustments and absence of footnotes and (ii) accompanied by a Narrative Report with respect thereto.
(c) Officers Certificate. At the time of the delivery of the financial statements
provided for in Section 9.1(a) and (b), a certificate of an Authorized Officer of the Borrower to the effect
that no Default or Event of Default exists or, if any Default or Event of Default does exist, specifying the
nature and extent thereof, which certificate shall set forth (i) the calculations required to establish whether
the Borrower and its Restricted Subsidiaries were in compliance with the provisions of Section 10.9 as at
the end of such fiscal year or period, as the case may be (including calculations in reasonable detail of any
amount added back to Consolidated EBITDA pursuant to clause (a)(xii), clause (a)(xiii) and any amount
excluded from Consolidated Net Income pursuant to clause k of the definition thereof), (ii) a specification
of any change in the identity of the Restricted Subsidiaries and Unrestricted Subsidiaries as at the end of
such fiscal year or period, as the case may be, from the Restricted Subsidiaries and Unrestricted
Subsidiaries, respectively, provided to the Lenders on the Closing Date of the most recent fiscal year or
period, as the case may be and (iii) the amount of any Pro Forma Adjustment not previously set forth in a
Pro Forma Adjustment Certificate or any change in the amount of a Pro Forma Adjustment set forth in
any Pro Forma Adjustment Certificate previously provided and, in either case, in reasonable detail, the
calculations and basis therefor. At the time of the delivery of the financial statements provided for in
Section 9.1(a), a certificate of an Authorized Officer of the Borrower setting forth (A) in reasonable detail
the Applicable Amount and the Applicable Equity Amount as at the end of the fiscal year to which such
financial statements relate and (B) the information required pursuant to Section 1 of the Perfection
Certificate or confirming that there has been no change in such information since the Closing Date or the
date of the most recent certificate delivered pursuant to this clause (c)(B), as the case may be.
(d) Annual Operating Forecast. Beginning on the date 60 days after the Interim
Order Entry Date (and again no later than December 1, 2014 for the business plan and operating budget
covering 2015, and no later than December 1, 2015 for the business plan and operating budget covering
2016), the approved annual business plan and projected operating budget (the Annual Operating
Forecast), on an annual basis, through the Maturity Date (as set forth in clause (a) of the definition
thereof), broken down by month, including, without limitation, income statements, balance sheets, cash
flow statements, projected capital expenditures, asset sales, a line item for total available liquidity for the
period of such Annual Operating Forecast, and which shall set forth the anticipated uses of the Credit
Facilities for such period, certified as to its reasonableness when made by an Authorized Officer of the
Borrower in the form of Exhibit C.
(e) Notice of Default; Litigation. Promptly after an Authorized Officer of the
Borrower or any Restricted Subsidiary obtains knowledge thereof, notice of (i) the occurrence of any
event that constitutes a Default or Event of Default, which notice shall specify the nature thereof, the
period of existence thereof and what action the Borrower proposes to take with respect thereto and (ii)
any litigation, regulatory or governmental proceeding pending against the Borrower or any Restricted

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Subsidiary that could reasonably be expected to be determined adversely and, if so determined, to result
in a Material Adverse Effect.
(f) Environmental Matters. Promptly after obtaining knowledge of any one or more
of the following environmental matters, unless such environmental matters known to the Borrower and
the Restricted Subsidiaries would not, individually, or when aggregated with all other such matters, be
reasonably expected to result in a Material Adverse Effect, notice of:
(i) any pending or threatened Environmental Claim against any Credit Party or any
Real Estate or any Credit Party or any predecessor in interest of the Borrower or any Restricted
Subsidiary or any other Person for which any Credit Party is alleged to be liable by contract or
operation of law;
(ii) any condition or occurrence on any Real Estate that (x) could reasonably be
expected to result in noncompliance by any Credit Party with any applicable Environmental Law
or (y) could reasonably be anticipated to form the basis of any Environmental Claim against any
Credit Party or any Real Estate;
(iii) any condition or occurrence on any Real Estate or any circumstance that could
reasonably be anticipated to cause such Real Estate to be subject to any restrictions on the
ownership, occupancy, use or transferability of such Real Estate under any Environmental Law
that would be inconsistent with the present use or operation of such Real Estate; and
(iv) the conduct of any investigation, or any removal, remedial or other corrective
action in response to the actual or alleged presence, release or threatened release into the
environment of any Hazardous Material on, at, under or from any Real Estate.
All such notices shall describe in reasonable detail the nature of the claim, investigation, condition,
occurrence, removal or remedial or other corrective action and the response thereto. The term Real
Estate shall mean any interest in land, buildings and improvements owned, leased or otherwise held by
any Credit Party, but excluding all operating fixtures and equipment.
(g) Other Information. Promptly upon filing thereof, copies of any filings (including
on Form 10-K, 10-Q or 8-K) or registration statements with, and reports to, the SEC or any analogous
Governmental Authority in any relevant jurisdiction by Parent Guarantor, the Borrower or any Restricted
Subsidiary (other than amendments to any registration statement (to the extent such registration statement,
in the form it becomes effective, is delivered to the Administrative Agent), exhibits to any registration
statement and, if applicable, any registration statements on Form S-8) and copies of all financial
statements, proxy statements, notices and reports that Parent Guarantor, the Borrower or any Restricted
Subsidiary shall send to the holders of any publicly issued debt of Parent Guarantor, the Borrower and/or
any Restricted Subsidiary in their capacity as such holders (in each case to the extent not theretofore
delivered to the Administrative Agent pursuant to this Agreement) and, with reasonable promptness, such
other information (financial or otherwise) as the Administrative Agent on its own behalf or on behalf of
any Lender (acting through the Administrative Agent) may reasonably request in writing from time to
time.
(h) Pro Forma Adjustment Certificate. Not later than any date on which financial
statements are delivered with respect to any Test Period in which a Pro Forma Adjustment is made, a
certificate of an Authorized Officer of the Borrower setting forth the amount of such Pro Forma
Adjustment and, in reasonable detail, the calculations and basis therefor.

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(i) Budget and Variance Report. (i) Commencing with the end of the first full fiscal
quarter ended after the entry of the Interim Order (or, at the election of the Borrower, at the end of each
calendar month or such earlier period as may be agreed), the Borrower shall promptly provide an updated
Budget for the subsequent 3-month period to the Administrative Agent.
(ii) With respect to each calendar month, no later than the end of the subsequent
calendar month in each case with respect to Parent Guarantor and its Restricted Subsidiaries, a
variance report showing a statement of actual cash sources and uses of all free cash flow for the
immediately such preceding calendar month, noting therein all material variances from values set
forth for such historical periods in the most recently delivered Budget, including narrative
explanations as to any material variances and certified as to its reasonableness when made by an
Authorized Officer of the Borrower.
(j) Monthly Reporting. As soon as available, but in any event not later than twenty
five days after the end of each calendar month, a report detailing (i) any material Dispositions
consummated by any Credit Party (or the entry into any binding contracts for a material Disposition by
any Credit Party), (ii) material developments in connection with any cost savings programs by any Credit
Party and (iii) such other matters as the Administrative Agent may reasonably request; provided that,
notwithstanding anything to the contrary in this clause (iii) (but without limitation of any other
requirement set forth in this Section 9.1), none of the Parent Guarantor, the Borrower or any of its
Restricted Subsidiaries will be required under this clause (iii) to provide any information to the extent that
the provision thereof would violate any attorney-client privilege (as reasonably determined by counsel to
the Credit Parties), law, rule or regulation, or any contractual obligation of confidentiality binding on the
Credit Parties or their respective affiliates (provided that (x) the Administrative Agent shall be notified if
any such information is being withheld and (y) the Credit Parties shall use commercially reasonable
efforts to obtain a consent to disclosure to the Administrative Agent of any such information being
withheld as a result of any contractual obligation of confidentiality (other than, for purposes of this clause
(y), any such information being withheld as a result of attorney-client privilege).
Notwithstanding the foregoing, the obligations in clauses (f), (h) and (i) of this
Section 9.1 may be satisfied with respect to financial information of the Borrower and the Restricted
Subsidiaries by furnishing (A) the applicable financial statements of Parent Guarantor, the Ultimate
Parent or any direct or indirect parent of the Ultimate Parent or (B) the Borrowers (or Parent Guarantors,
the Ultimate Parents or any direct or indirect parent thereof), as applicable, Form 10-K or 10-Q, as
applicable, filed with the SEC; provided that, with respect to each of subclauses (A) and (B) of this
paragraph, to the extent such information relates to Parent Guarantor, the Ultimate Parent or a parent of
the Ultimate Parent, such information is accompanied by consolidating or other information that explains
in reasonable detail the differences between the information relating to Parent Guarantor, the Ultimate
Parent or such parent, on the one hand, and the information relating to the Borrower and the Restricted
Subsidiaries on a standalone basis, on the other hand.
9.2. Books, Records and Inspections. The Borrower will, and will cause each
Restricted Subsidiary to, permit officers and designated representatives of the Administrative Agent
(including Financial Advisor) or the Required Lenders (as accompanied by the Administrative Agent) to
visit and inspect any of the properties or assets of the Borrower or such Restricted Subsidiary in
whomsoevers possession to the extent that it is within such partys control to permit such inspection (and
shall use commercially reasonable efforts to cause such inspection to be permitted to the extent that it is
not within such partys control to permit such inspection), and to examine the books and records of the
Borrower and any such Restricted Subsidiary and discuss the affairs, finances and accounts (including,
without limitation, strategic planning, cash and liquidity management and operational and restructuring
activities) of the Borrower and of any such Restricted Subsidiary with, and be advised as to the same by,

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its and their officers and independent accountants, all at such reasonable times and intervals and to such
reasonable extent as the Administrative Agent or Required Lenders may desire (and subject, in the case of
any such meetings or advice from such independent accountants, to such accountants customary policies
and procedures); provided that, excluding any such visits and inspections during the continuation of an
Event of Default (a) only the Administrative Agent, whether on its own or in conjunction with the
Required Lenders, may exercise rights of the Administrative Agent and the Lenders under this Section
9.2, (b) the Administrative Agent shall not exercise such rights more than two times in any calendar year
and (c) only one such visit shall be at the Borrowers expense; provided further that when an Event of
Default exists, the Administrative Agent (or any of its representatives or independent contractors) or any
representative of any Lender may do any of the foregoing at the expense of the Borrower at any time
during normal business hours and upon reasonable advance notice. The Administrative Agent and the
Required Lenders shall give the Borrower the opportunity to participate in any discussions with the
Borrowers independent public accountants. Notwithstanding anything to the contrary in this Section 9.2,
neither the Borrower nor any Restricted Subsidiary will be required under this Section 9.2 to disclose or
permit the inspection or discussion of any document, information or other matter to the extent that such
action would violate any attorney-client privilege (as reasonably determined by counsel to the Credit
Parties), law, rule or regulation, or any contractual obligation of confidentiality binding on the Credit
Parties or their respective affiliates (provided that (x) the Administrative Agent shall be notified if any
such information is being withheld and (y) the Credit Parties shall use commercially reasonable efforts to
obtain a consent to such disclosure or action being withheld as a result of any contractual obligation of
confidentiality (other than, for purposes of this clause (y), any such information being withheld as a result
of attorney-client privilege).
9.3. Maintenance of Insurance. The Borrower will, and will cause each Material
Subsidiary that is a Restricted Subsidiary to, at all times maintain in full force and effect, pursuant to self-
insurance arrangements or with insurance companies that the Borrower believes (in the good faith
judgment of the management of the Borrower, as applicable) are financially sound and responsible at the
time the relevant coverage is placed or renewed, insurance in at least such amounts (after giving effect to
any self-insurance which the Borrower believes (in the good faith judgment of management of the
Borrower, as applicable) is reasonable and prudent in light of the size and nature of its business) and
against at least such risks (and with such risk retentions) as the Borrower believes (in the good faith
judgment of management of the Borrower, as applicable) is reasonable and prudent in light of the size and
nature of its business; and will furnish to the Administrative Agent, upon written reasonable request from
the Administrative Agent, information presented in reasonable detail as to the insurance so carried. With
respect to each Mortgaged Property, obtain flood insurance in such total amount as the Administrative
Agent may from time to time require, if at any time the area in which any improvements located on any
Mortgaged Property is designated a flood hazard area in any Flood Insurance Rate Map published by
the Federal Emergency Management Agency (or any successor agency), and otherwise comply with the
National Flood Insurance Program as set forth in the Flood Disaster Protection Act of 1973, as amended
from time to time.
9.4. Payment of Taxes. The Borrower will pay and discharge, and will cause each of
the Restricted Subsidiaries to pay and discharge, all Taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits, or upon any properties belonging to it, prior to the
date on which penalties attach thereto, and all lawful claims in respect of any Taxes imposed, assessed or
levied that, if unpaid, could reasonably be expected to become a material Lien upon any properties of the
Borrower or any Restricted Subsidiary of the Borrower; provided that neither the Borrower nor any such
Restricted Subsidiary shall be required to pay any such tax, assessment, charge, levy or claim that is being
contested in good faith and by proper proceedings if it has maintained adequate reserves (in the good faith
judgment of management of the Borrower) with respect thereto in accordance with GAAP or the failure to
pay could not reasonably be expected to result in a Material Adverse Effect.

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9.5. Consolidated Corporate Franchises. The Borrower will do, and will cause each
Material Subsidiary that is a Restricted Subsidiary to do, or cause to be done, all things necessary to
preserve and keep in full force and effect its existence, corporate rights and authority, except to the extent
that the failure to do so could not reasonably be expected to have a Material Adverse Effect; provided,
however, that the Borrower and the Restricted Subsidiaries may consummate any transaction permitted
under Section 10.3, 10.4 or 10.5.
9.6. Compliance with Statutes, Regulations, Etc. The Borrower will, and will cause
each Restricted Subsidiary to, comply with all Applicable Laws applicable to it or its property, including
all governmental approvals or authorizations required to conduct its business, and to maintain all such
governmental approvals or authorizations in full force and effect, in each case except where the failure to
do so could not reasonably be expected to have a Material Adverse Effect.
9.7. ERISA.
(a) Promptly after the Borrower or any ERISA Affiliate knows or has reason to
know of the occurrence of any of the following events that, individually or in the aggregate (including in
the aggregate such events previously disclosed or exempt from disclosure hereunder, to the extent the
liability therefor remains outstanding), would be reasonably likely to have a Material Adverse Effect, the
Borrower will deliver to the Administrative Agent a certificate of an Authorized Officer or any other
senior officer of the Borrower setting forth details as to such occurrence and the action, if any, that the
Borrower or such ERISA Affiliate is required or proposes to take, together with any notices (required,
proposed or otherwise) given to or filed with or by the Borrower, such ERISA Affiliate, the PBGC, a Plan
participant (other than notices relating to an individual participants benefits) or the Plan administrator
with respect thereto: that a Reportable Event has occurred; that an accumulated funding deficiency has
been incurred or an application is to be made to the Secretary of the Treasury for a waiver or modification
of the minimum funding standard (including any required installment payments) or an extension of any
amortization period under Section 412 of the Code with respect to a Plan; that a Plan having an Unfunded
Current Liability has been or is to be terminated, reorganized, partitioned or declared insolvent under
Title IV of ERISA (including the giving of written notice thereof); that a Plan has an Unfunded Current
Liability that has or will result in a lien under ERISA or the Code; that proceedings will be or have been
instituted to terminate a Plan having an Unfunded Current Liability (including the giving of written notice
thereof); that a proceeding has been instituted against the Borrower or an ERISA Affiliate pursuant to
Section 515 of ERISA to collect a delinquent contribution to a Plan; that the PBGC has notified the
Borrower or any ERISA Affiliate of its intention to appoint a trustee to administer any Plan; that the
Borrower or any ERISA Affiliate has failed to make a required installment or other payment pursuant to
Section 412 of the Code with respect to a Plan; or that the Borrower or any ERISA Affiliate has incurred
or will incur (or has been notified in writing that it will incur) any liability (including any contingent or
secondary liability) to or on account of a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063,
4064, 4069, 4201 or 4204 of ERISA or Section 4971 or 4975 of the Code.
(b) Promptly following any request therefor, on and after the effectiveness of the
Pension Act, the Borrower will deliver to the Administrative Agent copies of (i) any documents described
in Section 101(k) of ERISA that the Borrower and any of the Restricted Subsidiaries or any ERISA
Affiliate may request with respect to any Multiemployer Plan and (ii) any notices described in Section
101(l) of ERISA that the Borrower and any of the Restricted Subsidiaries or any ERISA Affiliate may
request with respect to any Multiemployer Plan; provided that if the Borrower, any of such Restricted
Subsidiaries or any ERISA Affiliate has not requested such documents or notices from the administrator
or sponsor of the applicable Multiemployer Plan, the Borrower, the applicable Restricted Subsidiary(ies)
or the ERISA Affiliate(s) shall promptly make a request for such documents or notices from such

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administrator or sponsor and shall provide copies of such documents and notices promptly after receipt
thereof.
(c) Upon the reasonable request of the Administrative Agent, the Borrower shall
deliver to the Administrative Agent copies of: (i) each Schedule B (Actuarial Information) to the annual
report (Form 5500 Series) filed by the Borrower or any ERISA Affiliate with the Internal Revenue
Service with respect to each Plan, (ii) the most recent actuarial valuation report for each Plan, (iii) all
notices received by the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor or any
governmental agency and (iv) such other documents or governmental reports or filings relating to any
Employee Benefit Plan as the Administrative Agent shall reasonably request.
9.8. Maintenance of Properties. The Borrower will, and will cause the Restricted
Subsidiaries to, keep and maintain all property material to the conduct of its business in good working
order and condition (ordinary wear and tear excepted), except to the extent that the failure to do so could
reasonably be expected to have a Material Adverse Effect.
9.9. Transactions with Affiliates. The Borrower will conduct, and cause the Restricted
Subsidiaries to conduct, all transactions with any of its Affiliates (other than transactions between or
among the Borrower and the Restricted Subsidiaries and, between or among the Borrower, the Restricted
Subsidiaries and to the extent in the ordinary course or consistent with past practice the Ultimate Parent
and any of its other Subsidiaries, including the Oncor Subsidiaries) on terms that are, taken as a whole,
substantially as favorable to the Borrower or such Restricted Subsidiary as it would obtain in a
comparable arms-length transaction with a Person that is not an Affiliate; provided that, subject to the
Cash Management Order, the Tax Order, the Wages Order and any other orders of the Bankruptcy Court,
the foregoing restrictions shall not apply to:
(a) [reserved],
(b) transactions permitted by Sections 10.5(c) (other than clause (iii) thereof), (k),
(l), (m), (p), (z), and (bb) and Section 10.6,
(c) the Transactions and the payment of the Transaction Expenses,
(d) the issuance of Stock or Stock Equivalents of the Borrower (or any direct or
indirect parent thereof) to the management of the Borrower (or any direct or indirect parent thereof) or
any Subsidiary of the Borrower in connection with the Transactions or pursuant to arrangements
described in clause (f) of this Section 9.9,
(e) loans, advances and other transactions between or among the Borrower, any
Subsidiary of the Borrower or any joint venture (regardless of the form of legal entity) in which the
Borrower or any Subsidiary of the Borrower has invested (and which Subsidiary or joint venture would
not be an Affiliate of the Borrower but for the Borrowers or such Subsidiarys Subsidiary ownership of
Stock or Stock Equivalents in such joint venture or Subsidiary) to the extent permitted under Section 10,
(f) payments, advances or loans (or cancellation of loans), employment and
severance arrangements and health and benefit plans or agreements between the Ultimate Parent, Parent
Guarantor, the Borrower and the other Subsidiaries of the Ultimate Parent and their respective officers,
employees or consultants (including management and employee benefit plans or agreements, stock option
plans and other compensatory arrangements) in the ordinary course of business,

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(g) payments by the Borrower (and any direct or indirect parent thereof), and the
Subsidiaries of the Ultimate Parent pursuant to the Tax Sharing Agreements among the Borrower (and
any such parent) and the Subsidiaries of the Borrower to the extent attributable to the ownership or
operation of the Borrower and the Subsidiaries of the Ultimate Parent,
(h) the payment of customary fees and reasonable out of pocket costs to, and
indemnities provided on behalf of, directors, managers, consultants, officers and employees of the
Borrower (or, to the extent attributable to the ownership of the Borrower by such parent, any direct or
indirect parent thereof) and the Subsidiaries of the Borrower in the ordinary course of business,
(i) the payment of indemnities and reasonable out-of-pocket expenses incurred by
the Sponsors and their Affiliates in connection with services provided to the Borrower (or any direct or
indirect parent thereof), or any of the Subsidiaries of the Borrower,
(j) the issuance of Stock or Stock Equivalents (other than Disqualified Stock) of the
Borrower (or any direct or indirect parent thereof) to Ultimate Parent, any Permitted Holder or to any
director, officer, employee or consultant,
(k) sales of Receivables Facility Assets in connection with any Permitted
Receivables Financing,
(l) the performance of any and all obligations (including payment obligations)
pursuant to the Shared Services Agreement and other ordinary course transactions under the
intercompany cash management systems with Specified Affiliates and subleases of property from any
Specified Affiliate to the Borrower or any of the Restricted Subsidiaries, or as disclosed in any Budget
approved by the Administrative Agent and the J oint Lead Arrangers, and
(m) transactions pursuant to permitted agreements in existence on the Closing Date
and set forth on Schedule 9.9 or any amendment thereto to the extent such an amendment (together with
any other amendment or supplemental agreements) is not adverse, taken as a whole, to the Lenders in any
material respect.
9.10. End of Fiscal Years; Fiscal Quarters. The Borrower will, for financial reporting
purposes, cause (a) each of its, and the Restricted Subsidiaries fiscal years to end on December 31 of
each year (each a Fiscal Year) and (b) each of its, and the Restricted Subsidiaries, fiscal quarters to
end on dates consistent with such fiscal year-end; provided, however, that the Borrower may, upon
written notice to the Administrative Agent change the financial reporting convention specified above to
any other financial reporting convention reasonably acceptable to the Administrative Agent, in which case
the Borrower and the Administrative Agent will, and are hereby authorized by the Lenders to, make any
adjustments to this Agreement that are necessary in order to reflect such change in financial reporting.
9.11. Additional Guarantors and Grantors. Subject to any applicable limitations set
forth in the Guarantee and the Security Documents, the Borrower will cause each direct or indirect
Domestic Subsidiary of the Borrower (excluding any Excluded Subsidiary) formed or otherwise
purchased or acquired after the Closing Date and each other Domestic Subsidiary of the Borrower that
ceases to constitute an Excluded Subsidiary to, within 30 days from the date of such formation,
acquisition or cessation, as applicable (or such longer period as the Administrative Agent may agree in its
reasonable discretion), (i) become a Guarantor under the Guarantee and a grantor under the Security
Agreement pursuant to (A) the Interim Order or (when applicable) the Final Order or (B) if reasonably
requested by the Administrative Agent, a supplement to each of the Guarantee and the Security

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Agreement and (ii) if reasonably requested by the Administrative Agent, execute a joinder to the
Intercompany Subordinated Note.
9.12. Pledge of Additional Stock and Evidence of Indebtedness.
(a) Subject to any applicable limitations set forth in the Security Documents, the
Borrower will promptly notify the Administrative Agent in writing of any Stock or Stock Equivalents
issued or otherwise purchased or acquired after the Closing Date and of any Indebtedness in excess of
$10,000,000 that is owing to the Borrower or any Subsidiary Guarantor (or Person required to become a
Subsidiary Guarantor pursuant to Section 9.11) incurred (individually or in a series of related
transactions) after the Closing Date and, in each case, if reasonably requested by the Administrative
Agent, will pledge, and, if applicable, will cause each other Subsidiary Guarantor (or Person required to
become a Subsidiary Guarantor pursuant to Section 9.11), to pledge to the Collateral Agent for the benefit
of the Secured Parties, (i) all such Stock and Stock Equivalents (other than any Excluded Stock and Stock
Equivalents), pursuant to a Pledge Agreement or supplement thereto, and (ii) all evidences of such
Indebtedness, pursuant to a Pledge Agreement or supplement thereto.
(a) The Borrower agrees that, at the reasonable request of the Administrative Agent,
all Indebtedness of the Borrower and the Restricted Subsidiaries of the Borrower and that is owing to the
Borrower or to any Subsidiary Guarantor (or Person required to become a Subsidiary Guarantor pursuant
to Section 9.11) shall be evidenced by the Intercompany Subordinated Note.
9.13. [Reserved].
9.14. Further Assurances.
(a) Subject to the applicable limitations set forth in this Agreement and in the
Security Documents, the Borrower will, and will cause each other Credit Party to, execute any and all
further documents, financing statements, agreements and instruments, and take all such further actions
(including the filing and recording of financing statements, fixture filings, and other documents) that may
be required under any Applicable Law, or that the Collateral Agent or the Required Lenders may
reasonably request, in order to grant, preserve, protect and perfect the validity and priority of the security
interests created or intended to be created by the applicable Security Documents, all at the expense of
Parent Guarantor, the Borrower and the other Guarantors; provided, however, that notwithstanding
anything to the contrary contained in this Agreement or in any other Credit Document, but without
limiting the grant of a Lien on and security interest in the Collateral pursuant to the Orders and the
Security Documents, the TCEH Debtors will not be obligated to enter into any Mortgage, authorize any
fixture filing, enter into any agreement providing control as defined in Section 9-104, 9-105, 9-106 and
9-107 of the UCC as in effect in any relevant jurisdiction) or to undertake any registration in respect of
assets subject to a certificate of title.
(b) [Reserved].
(c) [Reserved].
(d) [Reserved].
(e) Notwithstanding anything herein to the contrary, if the Collateral Agent
determines (taking into account the existence and effect of the Orders) in its reasonable judgment
(confirmed in writing to the Borrower and the Administrative Agent) that the cost or other consequences
(including adverse tax and accounting consequences) of creating or perfecting any Lien on any property is

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excessive in relation to the benefits afforded to the Secured Party thereby, then such property may be
excluded from the Collateral for all purposes of the Credit Documents.
9.15. Bankruptcy Matters.
(a) The Borrower will deliver to the Administrative Agent and its legal counsel, at
least two Business Days in advance of filing with the Bankruptcy Court, copies of all proposed First Day
Orders and motions seeking approval of the First Day Orders, which shall be in form and substance
reasonably satisfactory to the Administrative Agent (but in the case of the Cash Management Order, the
Interim Cash Collateral Order, and the Interim Order, shall be satisfactory in form and substance to the
Administrative Agent).
(b) The Borrower will deliver to the Administrative Agent, and in the case of (iii)
below to its legal counsel, as soon as practicable in advance of filing with the Bankruptcy Court (i) the
Final Order (which must be in form and substance satisfactory to the Administrative Agent), (ii) all other
proposed material orders and pleadings related to the Credit Facilities (which must be in form and
substance reasonably satisfactory to the Administrative Agent) and (iii) any plan of reorganization or
liquidation and/or any disclosure statement related to such plan (which shall be in form and substance
reasonably satisfactory to the Administrative Agent; provided that with respect to provisions of the plan
of reorganization and/or disclosure statements that relate to the payment of the Credit Facilities, such
provisions must be in form and substance satisfactory to the Administrative Agent).
(c) The Borrower shall maintain a cash management system in accordance with the
Cash Management Order and the Orders each of which shall be in form and substance satisfactory to the
(d) The Borrower shall file with the Bankruptcy Court a plan of reorganization and a
disclosure statement relating thereto, each in form and substance reasonably satisfactory to the
Administrative Agent, within 18 months after the Petition Date; provided, however, that with respect to
provisions of the plan of reorganization and/or any disclosure statement that relate to payment of the
Credit Facilities, such provisions must be in form and substance satisfactory to the Administrative Agent.
(e) The Borrower shall contest, if requested by the Administrative Agent, any
motion seeking entry of an order, and entry of an order, that is materially adverse to the interests of the
Administrative Agent or the Lenders or their respective material rights and remedies under the Credit
Documents in any of the Cases;
9.16. Ratings. The Borrower shall use commercially reasonable efforts to obtain ratings
from each of Moodys and S&P as soon as reasonably practicable after the Closing Date.
9.17. Use of Proceeds. Parent Guarantor and the Borrower shall not, and shall not
permit any other Credit Party or any other Restricted Subsidiary to:
(a) use the proceeds of the Credit Facilities or any Letters of Credit issued hereunder
for purposes other than those permitted under this Agreement and contained in the Interim Order or the
Final Order, as applicable;
(b) use the proceeds of the Credit Facilities or any Letters of Credit issued hereunder
for purposes that would violate the provisions of Regulation T, U or X of the Board;

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(c) use the proceeds of any Revolving Credit Loan to fund any RCT L/C Collateral
Account until (i) the earlier to occur of (x) the funding of the Delayed-Draw Term Loans in an amount
equal to the aggregate amount of Delayed-Draw Term Loan Commitments as of the Closing Date and (y)
the termination in full of the Delayed-Draw Term Loan Commitments and (ii) the funding of the Term
Loans as of the Full Availability Date;
(d) use the proceeds of the Delayed-Draw Term Loans for purposes other than
funding the RCT L/C Collateral Accounts; and
(e) use the proceeds of the Term Loans to fund the General L/C Collateral Accounts
in an amount exceeding $800,000,000 in the aggregate.
SECTION 10. Negative Covenants.
The Borrower hereby covenants and agrees that on the Closing Date and thereafter, until
all Commitments and all Letters of Credit have terminated (unless such Letters of Credit have been
collateralized on terms and conditions reasonably satisfactory to the applicable Letter of Credit Issuer
following the termination of the Revolving Credit Commitments) and the Loans and Unpaid Drawings,
together with interest, fees and all other Obligations (other than Hedging Obligations under Secured
under Secured Cash Management Agreement or Contingent Obligations) are paid in full:
10.1. Limitation on Indebtedness. The Borrower will not, and will not permit the
Restricted Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness.
Notwithstanding the foregoing, the limitations set forth in the immediately preceding
paragraph shall not apply to any of the following items:
(a) Indebtedness arising under the Credit Documents (including any Indebtedness
incurred pursuant to Section 2.14);
(b) subject to compliance with Section 10.5, Indebtedness of the Borrower or any
Restricted Subsidiary owed to the Borrower or any Restricted Subsidiary; provided that all such
Indebtedness of any Credit Party owed to any Person that is not a Credit Party shall be (x) evidenced by
the Intercompany Subordinated Note or (y) otherwise be subject to subordination terms substantially
identical to the subordination terms set forth in the Intercompany Subordinated Note or otherwise
reasonably acceptable to the Administrative Agent;
(c) Indebtedness in respect of any bankers acceptance, bank guarantees, letter of
credit, warehouse receipt or similar facilities entered into in the ordinary course of business (including in
respect of construction and restoration activities and in respect of workers compensation claims, health,
disability or other employee benefits or property, casualty or liability insurance or self-insurance or other
Indebtedness with respect to reimbursement-type obligations regarding workers compensation claims);
(d) subject to compliance with Section 10.5, Guarantee Obligations incurred by
(i) Restricted Subsidiaries in respect of Indebtedness of the Borrower or any other Restricted Subsidiary
that is permitted to be incurred under this Agreement (except that a Restricted Subsidiary that is not a
Credit Party may not, by virtue of this Section 10.1(d) guarantee Indebtedness that such Restricted
Subsidiary could not otherwise incur under this Section 10.1) and (ii) the Borrower in respect of
Indebtedness of Restricted Subsidiaries that is permitted to be incurred under this Agreement; provided
that (A) if the Indebtedness being guaranteed under this Section 10.1(d) is subordinated to the

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Obligations, such Guarantee Obligations shall be subordinated to the Guarantee of the Obligations on
terms at least as favorable to the Lenders as those contained in the subordination of such Indebtedness,
(B) [Reserved] and (C) the aggregate amount of Guarantee Obligations incurred by Restricted
Subsidiaries that are not Subsidiary Guarantors under this clause (d), when combined with the total
amount of Indebtedness incurred by Restricted Subsidiaries that are not Subsidiary Guarantors pursuant to
Section 10.1(j) and Section 10.1(n), shall not exceed $200,000,000 at any time outstanding;
(e) Guarantee Obligations (i) incurred in the ordinary course of business (including
in respect of construction or restoration activities) in respect of obligations of (or to) suppliers, customers,
franchisees, lessors and licensees or (ii) otherwise constituting Investments permitted by Sections 10.5(d),
10.5(g), 10.5(i), 10.5(q), 10.5(t) and 10.5(v);
(f) (i) Indebtedness (including Indebtedness arising under Capital Leases) incurred
to finance the purchase price, cost of design, acquisition, construction, repair, restoration, replacement,
expansion, installation or improvement of fixed or capital assets or otherwise in respect of Capital
Expenditures, so long as such Indebtedness, except in the case of Environmental CapEx or Necessary
CapEx, is incurred within 270 days of the acquisition, construction, repair, restoration, replacement,
expansion, installation or improvement of such fixed or capital assets or incurrence of such Capital
Expenditure, (ii) Indebtedness arising under Capital Leases entered into in connection with Permitted Sale
Leasebacks and (iii) Indebtedness arising under Capital Leases, other than Capital Leases in effect on the
Closing Date and Capital Leases entered into pursuant to subclauses (i) and (ii) above; provided, that the
aggregate amount of Indebtedness incurred pursuant to this clause (iii) at any time outstanding shall not
exceed $400,000,000 and (iv) any modification, replacement, refinancing, refunding, renewal or
extension of any Indebtedness specified in subclause (i), (ii) or (iii) above; provided that, except to the
extent otherwise expressly permitted hereunder, the principal amount thereof does not exceed the
principal amount thereof outstanding immediately prior to such modification, replacement, refinancing,
refunding, renewal or extension except by an amount equal to the unpaid accrued interest and premium
thereon plus the reasonable amounts paid in respect of fees and expenses incurred in connection with such
modification, replacement, refinancing, refunding, renewal or extension;
(g) Indebtedness outstanding on the Closing Date listed on Schedule 10.1 and the
Prepetition Debt and any modification, replacement, refinancing, refunding, renewal or extension thereof;
provided that except to the extent otherwise expressly permitted hereunder, in the case of any such
modification, replacement, refinancing, refunding, renewal or extension, (i) the principal amount thereof
(including any unused commitments) does not exceed the principal amount thereof outstanding
immediately prior to such modification, replacement, refinancing, refunding, renewal or extension except
by an amount equal to the unpaid accrued interest and premium thereon plus the reasonable amounts paid
in respect of fees and expenses incurred in connection with such modification, replacement, refinancing,
refunding, renewal or extension, (ii) the direct and contingent obligors with respect to such Indebtedness
are not changed (iii) no portion of such Indebtedness matures prior to the Stated Maturity of such
Indebtedness as in effect as of the Closing Date and (iv) if the Indebtedness being refinanced, or any
guarantee thereof, constituted subordinated Indebtedness, then such replacement or refinancing
Indebtedness, or such guarantee, respectively, shall be subordinated to the Obligations to substantially the
same extent (it being understood that an Incremental Amendment may provide, without the consent of
any other Lender required, for restrictions similar and in addition to those set forth in this Section
10.1(g)(iv) on modification, replacement, refinancing, refunding, renewal or extension of Indebtedness
which matures on or after the Maturity Date but on or before the final maturity date for the Incremental
Term Loans in such Incremental Amendment);
(h) Indebtedness in respect of Hedging Agreements; provided that (i) other than in
the case of Commodity Hedging Agreements, such Hedging Agreements are not entered into for

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speculative purposes (as determined by the Borrower in its reasonable discretion acting in good faith) and
(ii) any speculative Commodity Hedging Agreements must be entered into in the ordinary course of
business and shall be consistent with past practice;
(i) [reserved];
(j) (i) Indebtedness of a Person or Indebtedness attaching to assets of a Person
that, in either case, becomes a Restricted Subsidiary (or is a Restricted Subsidiary that survives a merger
with such Person or any of its Subsidiaries) or Indebtedness attaching to assets that are acquired by the
Borrower or any Restricted Subsidiary, in each case after the Closing Date as the result of a Permitted
Acquisition; provided that
(x) such Indebtedness existed at the time such Person became a Restricted
Subsidiary or at the time such assets were acquired and, in each case, was not created in
anticipation thereof,
(y) such Indebtedness is not guaranteed in any respect by the Borrower or
any Restricted Subsidiary (other than by any such Person that so becomes a Restricted
Subsidiary or is the survivor of a merger with such Person or any of its Subsidiaries), and
(z) (A) the Stock and Stock Equivalents of such Person are pledged to the
Collateral Agent to the extent required under Section 9.12 and (B) such Person executes a
supplement to each of the Guarantee and the Security Documents (or alternative
guarantee and security arrangements in relation to the Obligations reasonably acceptable
to the Collateral Agent); provided, further, that the requirements of this subclause (z)
shall not apply to any Indebtedness of the type that could have been incurred under
Section 10.1(f);
(ii) any modification, replacement, refinancing, refunding, renewal or extension of
any Indebtedness specified in subclause (j)(i) above; provided that, except to the extent otherwise
expressly permitted hereunder, (x) the principal amount of any such Indebtedness does not exceed
the principal amount thereof outstanding immediately prior to such modification, replacement,
refinancing, refunding, renewal or extension except by an amount equal to the unpaid accrued
interest and premium thereon plus the reasonable amounts paid in respect of fees and expenses
incurred in connection with such modification, replacement, refinancing, refunding, renewal or
extension, (y) the direct and contingent obligors with respect to such Indebtedness are not
changed and (z) if the Indebtedness being refinanced, or any guarantee thereof, constituted
subordinated Indebtedness, then such replacement or refinancing Indebtedness, or such guarantee,
respectively, shall be subordinated to the Obligations to substantially the same extent; and
provided further that the aggregate amount of Indebtedness incurred under this
Section 10.1(j) (A) shall not exceed $200,000,000 at any time outstanding and (B) by Restricted
Subsidiaries that are not Subsidiary Guarantors, when combined with the total amount of
Indebtedness incurred by Restricted Subsidiaries that are not Subsidiary Guarantors pursuant to
Sections 10.1(d) and 10.1(n), shall not exceed $200,000,000 at any time outstanding;
(k) [reserved].
(l) Indebtedness in respect of performance bonds, bid bonds, appeal bonds, surety
bonds and completion guarantees and similar obligations not in connection with money borrowed, in each
case provided in the ordinary course of business (including in respect of construction or restoration

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activities) or consistent with past practice or in respect of coal mine reclamation, including those incurred
to secure health, safety and environmental obligations in the ordinary course of business (including in
respect of construction or restoration activities) or consistent with past practice;
(m) (i) Indebtedness incurred in connection with any Permitted Sale Leaseback and
(ii) any modification, replacement, refinancing, refunding, renewal or extension of any Indebtedness
specified in subclause (m)(i) above; provided that, except to the extent otherwise permitted hereunder,
(x) the principal amount of any such Indebtedness is not increased above the principal amount thereof
outstanding immediately prior to such modification, replacement, refinancing, refunding, renewal or
extension except by an amount equal to the unpaid accrued interest and premium thereon plus the
reasonable amounts paid in respect of fees and expenses incurred in connection with such modification,
replacement, refinancing, refunding, renewal or extension and (y) the direct and contingent obligors with
respect to such Indebtedness are not changed;
(n) additional Indebtedness; provided that the aggregate amount of Indebtedness
incurred and remaining outstanding pursuant to this Section 10.1(n) shall not at any time exceed
$250,000,000; provided, that the aggregate amount of Indebtedness incurred by Restricted Subsidiaries
that are not Subsidiary Guarantors under this Section 10.1(n), when combined with the total amount of
Indebtedness incurred by Restricted Subsidiaries that are not Subsidiary Guarantors pursuant to Section
10.1(d) and 10.1(j), shall not exceed $200,000,000 at any time outstanding;
(o) [reserved];
(p) Cash Management Obligations and other Indebtedness in respect of overdraft
facilities, employee credit card programs, netting services, automatic clearinghouse arrangements and
other cash management and similar arrangements in the ordinary course of business;
(q) (i) Indebtedness incurred in the ordinary course of business in respect of
obligations of the Borrower or any Restricted Subsidiary to pay the deferred purchase price of goods or
services or progress payments in connection with such goods and services, including turbines,
transformers and similar equipment and (ii) Indebtedness in respect of intercompany obligations of the
Borrower or any Restricted Subsidiary with the Borrower or any Restricted Subsidiary of the Borrower in
respect of accounts payable incurred in connection with goods sold or services rendered in the ordinary
course of business and not in connection with the borrowing of money;
(r) Indebtedness arising from agreements of the Borrower or any Restricted
Subsidiary providing for indemnification, adjustment of purchase price or similar obligations (including
earn-outs), in each case entered into in connection with Permitted Acquisitions, other Investments and the
Disposition of any business, assets or Stock or Stock Equivalents permitted hereunder;
(s) Indebtedness of the Borrower or any Restricted Subsidiary consisting of (i)
obligations to pay insurance premiums or (ii) take or pay obligations contained in supply agreements, in
each case arising in the ordinary course of business (including in respect of construction or restoration
activities);
(t) Indebtedness representing deferred compensation to employees, consultants or
independent contractors of the Borrower (or, to the extent such work is done for the Borrower or its
Subsidiaries, any direct or indirect parent thereof) and the Restricted Subsidiaries incurred in the ordinary
course of business;

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(u) Indebtedness consisting of promissory notes issued by any Credit Party to current
or former officers, managers, consultants, directors and employees (or their respective spouses, former
spouses, successors, executors, administrators, heirs, legatees or distributees) to finance the purchase or
redemption of Stock or Stock Equivalents of the Borrower (or any direct or indirect parent thereof)
permitted by Section 10.6(b);
(v) Indebtedness consisting of obligations of the Borrower and the Restricted
Subsidiaries under deferred compensation or other similar arrangements incurred by such Person in
connection with the Transactions and Permitted Acquisitions or any other Investment permitted
hereunder;
(w) Indebtedness in respect of Permitted Receivables Financings;
(x) Indebtedness of the Borrower or any Restricted Subsidiary to the Ultimate Parent
or any of its other Subsidiaries in the aggregate amount at any time outstanding not in excess of
$25,000,000;
(y) [reserved];
(z) [reserved]; and
(aa) all premiums (if any), interest (including post-petition interest), fees, expenses,
charges, and additional or contingent interest on obligations described in clauses (a) through (x) above.
For purposes of determining compliance with this Section 10.1, in the event that an item
of Indebtedness meets the criteria of more than one of the categories of Indebtedness described clauses (a)
through (aa) above, the Borrower shall, in its sole discretion, classify and reclassify or later divide,
classify or reclassify such item of Indebtedness (or any portion thereof) and will only be required to
include the amount and type of such Indebtedness in one or more of the above paragraph or clauses;
provided that all Indebtedness outstanding under the Credit Documents will be deemed at all times to
have been incurred in reliance only on the exception in clause (a) of Section 10.1.
10.2. Limitation on Liens. The Borrower will not, and will not permit the Restricted
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any property or assets of any kind
(real or personal, tangible or intangible) of the Borrower or such Restricted Subsidiary, whether now
owned or hereafter acquired, except:
(a) Liens arising under (i) the Credit Documents and/or created pursuant to the
Interim Order and the Final Order, in each case securing the Obligations;
(b) Liens on the Collateral securing obligations under Secured Cash Management
Agreements, Secured Hedging Agreements and Secured Commodity Hedging Agreements; provided that
(i) such obligations shall be secured by the Liens granted in favor of the Collateral Agent in the manner
set forth in, and be otherwise subject to (and in compliance with), this Agreement and governed by the
applicable Security Documents and (ii) such agreements were not entered into for speculative purposes
(as determined by the Borrower at the time such agreement was entered into in its reasonable discretion
acting in good faith) and, in the case of any Secured Commodity Hedging Agreement or any Secured
Hedging Agreement of the type described in clause (c) of the definition of Hedging Agreement, entered
into in order to hedge against or manage fluctuations in the price or availability of any Covered
Commodity);

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(c) Permitted Liens;
(d) Liens securing Indebtedness permitted pursuant to Section 10.1(f); provided that
(x) except with respect to any Indebtedness incurred in connection with Environmental CapEx or
Necessary CapEx, such Liens attach concurrently with or within two hundred and seventy (270) days
after completion of the acquisition, construction, repair, restoration, replacement, expansion, installation
or improvement (as applicable) of the property subject to such Liens and (y) such Liens attach at all times
only to the assets so financed except (1) for accessions to the property financed with the proceeds of such
Indebtedness and the proceeds and the products thereof and (2) that individual financings of equipment
provided by one lender may be cross collateralized to other financings of equipment provided by such
lender;
(e) Liens existing on the Closing Date; provided that any Lien securing Indebtedness
or other obligations in excess of (x) $20,000,000 individually or (y) $100,000,000 in the aggregate (when
taken together with all other Liens securing obligations outstanding in reliance on this clause (e) that are
not set forth on Schedule 10.2) shall only be permitted to the extent such Lien is listed on Schedule 10.2;
(f) the modification, replacement, extension or renewal of any Lien permitted by
clauses (a) through (e) and clause (g) of this Section 10.2 upon or in the same assets theretofore subject to
such Lien (or upon or in after-acquired property that is affixed or incorporated into the property covered
by such Lien or any proceeds or products thereof) or the modification, refunding, refinancing,
replacement, extension or renewal (without increase in the amount or change in any direct or contingent
obligor except to the extent otherwise permitted hereunder) of the Indebtedness or other obligations
secured thereby (including any unused commitments), to the extent such modification, refunding,
refinancing, replacement, extension or renewal is permitted by Section 10.1;
(g) Liens existing on the assets of any Person that becomes a Restricted Subsidiary
(or is a Restricted Subsidiary that survives a merger with such Person or any of its Subsidiaries) pursuant
to a Permitted Acquisition or other permitted Investment, or existing on assets acquired after the Closing
Date, to the extent the Liens on such assets secure Indebtedness permitted by Section 10.1(j); provided
that such Liens (i) are not created or incurred in connection with, or in contemplation of, such Person
becoming such a Restricted Subsidiary or such assets being acquired and (ii) attach at all times only to the
same assets to which such Liens attached (and after-acquired property that is affixed or incorporated into
the property covered by such Lien), and secure only the same Indebtedness or obligations that such Liens
secured, immediately prior to such Permitted Acquisition and any modification, replacement, refinancing,
refunding, renewal or extension thereof permitted by Section 10.1(j);
(h) [reserved];
(i) Liens securing Indebtedness or other obligations (i) of the Borrower or any
Restricted Subsidiary in favor of a Credit Party and (ii) of any other Restricted Subsidiary that is not a
Credit Party in favor of any other Restricted Subsidiary that is not a Credit Party;
(j) Liens (i) of a collecting bank arising under Section 4-210 of the Uniform
Commercial Code on items in the course of collection and (ii) in favor of a banking institution arising as a
matter of law encumbering deposits (including the right of set-off);
(k) Liens (i) on cash advances in favor of the seller of any property to be acquired in
an Investment permitted pursuant to Section 10.5 to be applied against the purchase price for such
Investment and (ii) consisting of an agreement to sell, transfer, lease or otherwise dispose of any property
in a transaction permitted under Section 10.4, in each case, solely to the extent such Investment or sale,

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disposition, transfer or lease, as the case may be, would have been permitted on the date of the creation of
such Lien;
(l) Liens arising out of conditional sale, title retention, consignment or similar
arrangements for sale or purchase of goods entered into by the Borrower or any Restricted Subsidiary in
the ordinary course of business (including in respect of construction or restoration activities) permitted by
this Agreement;
(m) Liens deemed to exist in connection with Investments in repurchase agreements
permitted under Section 10.5;
(n) any amounts held by a trustee in the funds and accounts under an indenture
securing any revenue bonds issued for the benefit of the Borrower or any Restricted Subsidiary;
(o) Liens that are contractual rights of set-off (i) relating to the establishment of
depository relations with banks not given in connection with the issuance of Indebtedness, (ii) relating to
pooled deposit or sweep accounts of the Borrower or any Restricted Subsidiary to permit satisfaction of
overdraft or similar obligations incurred in the ordinary course of business of the Borrower and the
Restricted Subsidiaries or (iii) relating to purchase orders and other agreements entered into with
customers of the Borrower or any Restricted Subsidiary in the ordinary course of business;
(p) Liens solely on any cash earnest money deposits made by the Borrower or any
Restricted Subsidiary in connection with any letter of intent or purchase agreement permitted hereunder;
(q) Liens on insurance policies and the proceeds thereof securing the financing of the
premiums with respect thereto;
(r) Liens on specific items of inventory or other goods and the proceeds thereof
securing such Persons obligations in respect of documentary letters of credit or bankers acceptances
issued or created for the account of such Person to facilitate the purchase, shipment or storage of such
inventory or goods in the ordinary course of business or consistent with past practice;
(s) [reserved];
(t) [reserved];
(u) Liens in respect of Permitted Sale Leasebacks;
(v) Liens on Receivables Facility Assets in respect of any Permitted Receivables
Financing;
(w) rights reserved to or vested in others to take or receive any part of, or royalties
related to, the power, gas, oil, coal, lignite or other minerals or timber generated, developed,
manufactured or produced by, or grown on, or acquired with, any property of the Borrower and the
Restricted Subsidiaries and Liens upon the production from property of power, gas, oil, coal, lignite or
other minerals or timber, and the by-products and proceeds thereof, to secure the obligations to pay all or
a part of the expenses of exploration, drilling, mining or development of such property only out of such
production or proceeds;
(x) Liens arising out of all presently existing and future division and transfer orders,
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agreements, gas balancing or deferred production agreements, pooling, unitization or communitization
agreements, pipeline, gathering or transportation agreements, platform agreements, drilling contracts,
injection or repressuring agreements, cycling agreements, construction agreements, shared facilities
agreements, salt water or other disposal agreements, leases or rental agreements, farm-out and farm-in
agreements, exploration and development agreements, and any and all other contracts or agreements
covering, arising out of, used or useful in connection with or pertaining to the exploration, development,
operation, production, sale, use, purchase, exchange, storage, separation, dehydration, treatment,
compression, gathering, transportation, processing, improvement, marketing, disposal or handling of any
property of the Borrower and the Restricted Subsidiaries; provided that such agreements are entered into
in the ordinary course of business (including in respect of construction or restoration activities);
(y) any restrictions on any Stock or Stock Equivalents or other joint venture interests
of the Borrower or any Restricted Subsidiary providing for a breach, termination or default under any
owners, participation, shared facility, joint venture, stockholder, membership, limited liability company or
partnership agreement between such Person and one or more other holders of such Stock or Stock
Equivalents or interest of such Person, if a security interest or other Lien is created on such Stock or Stock
Equivalents or interest as a result thereof and other similar Liens;
(z) Rights of first refusal and purchase options in favor of Aluminum Company of
America (Alcoa) to purchase Sandow Unit 4 and/or the real property related thereto, as described in (i)
Sandow Unit 4 Agreement dated August 13, 1976, as amended, between Alcoa and Texas Power & Light
Company (TPL) and in (ii) Deeds dated March 14, 1978 and J uly 21, 1980, as amended, executed by
Alcoa conveying to TPL the Sandow Unit 4 real property;
(aa) Lien and other exceptions to title, in either case on or in respect of any facilities
of the Borrower or any Restricted Subsidiary, arising as a result of any shared facility agreement entered
into with respect to such facility, except to the extent that any such Liens or exceptions, individually or in
the aggregate, materially adversely affect the value of the relevant property or materially impair the use of
the relevant property in the operation of business the Borrower and the Restricted Subsidiaries, taken as a
whole;
(bb) Liens on cash and Permitted Investments (i) deposited by the Borrower or any
Restricted Subsidiary in margin accounts with or on behalf of brokers, credit clearing organizations,
independent system operators, regional transmission organizations, pipelines, state agencies, federal
agencies, futures contract brokers, customers, trading counterparties, or any other parties or issuers of
surety bonds or (ii) pledged or deposited as collateral by the Borrower or any Restricted Subsidiary with
any of the entities described in clause (i) above to secure their respective obligations, in the case of each
of clauses (i) and (ii) above, with respect to: (A) any contracts and transactions for the purchase, sale,
exchange of, or the option (whether physical or financial) to purchase, sell or exchange (1) natural gas, (2)
electricity, (3) coal, (4) petroleum-based liquids, (5) oil, (6) nuclear fuel (including enrichment and
conversion), (7) emissions or other environmental credits, (8) waste byproducts, (9) weather, (10) power
and other generation capacity, (11) heat rate, (12) congestion, (13) renewal energy credit or (14) any other
energy-related commodity or services or derivative (including ancillary services and related risk (such as
location basis) or weather related risk); (B) any contracts or transactions for the purchase, processing,
transmission, transportation, distribution, sale, lease, hedge or storage of, or any other services related to
any commodity or service identified in subparts (1) - (14) above, including any capacity agreement; (C)
any financial derivative agreement (including but not limited to swaps, options or swaptions) related to
any commodity identified in subparts (1) - (14) above, or to any interest rate or currency rate management
activities; (D) any agreement for membership or participation in an organization that facilitates or permits
the entering into or clearing of any Netting Agreement, any insurance or self-insurance arrangements or
any agreement described in this Section 10.2(bb); (E) any agreement combining part or all of a Netting

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Agreement or part or all of any of the agreements described in this Section 10.2(bb); (F) any document
relating to any agreement described in this Section 10.2(bb) that is filed with a Governmental Authority
and any related service agreements; or (G) any commercial or trading agreements, each with respect to, or
involving the purchase, transmission, distribution, sale, lease or hedge of, any energy, generation capacity
or fuel, or any other energy related commodity or service, price or price indices for any such commodities
or services or any other similar derivative agreements, and any other similar agreements (such agreements
described in clauses (A) through (G) of this Section 10.2(bb) being collectively, Permitted Contracts),
Netting Agreements, Hedging Agreements and letters of credit supporting Permitted Contracts, Netting
Agreements and Hedging Agreements; and
(cc) additional Liens so long as the aggregate amount of obligations secured thereby
at any time outstanding does not exceed $20,000,000.
10.3. Limitation on Fundamental Changes. Except as permitted by Section 10.4 or
10.5, the Borrower will not, and will not permit the Restricted Subsidiaries to, consummate any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease, assign, transfer or otherwise consummate the disposition of, all or
substantially all its business units, assets or other properties, except that:
(a) so long as (i) both before and after giving effect to such transaction, no Payment
Default or Event of Default has occurred and is continuing or would result therefrom and (ii) after giving
effect to such transaction the Borrower shall be in compliance, on a Pro Forma Basis, with the covenant
set forth in Section 10.9, any Subsidiary of the Borrower or any other Person may be merged,
amalgamated or consolidated with or into the Borrower; provided that the Borrower shall be the
continuing or surviving company;
(b) so long as no Payment Default or Event of Default has occurred and is
continuing, or would result therefrom, any Subsidiary of the Borrower or any other Person (in each case,
other than the Borrower) may be merged, amalgamated or consolidated with or into any one or more
Subsidiaries of the Borrower; provided that (i) in the case of any merger, amalgamation or consolidation
involving one or more Restricted Subsidiaries, (A) a Restricted Subsidiary shall be the continuing or
surviving Person or (B) the Borrower shall cause the Person formed by or surviving any such merger,
amalgamation or consolidation (if other than a Restricted Subsidiary) to become a Restricted Subsidiary,
(ii) in the case of any merger, amalgamation or consolidation involving one or more Guarantors, a
Guarantor shall be the continuing or surviving Person or the Person formed by or surviving any such
merger, amalgamation or consolidation (if other than a Guarantor) shall execute a supplement to the
Guarantee and the relevant Security Documents and a joinder to the Intercompany Subordinated Note,
each in form and substance reasonably satisfactory to the Administrative Agent in order to become a
Guarantor and pledgor, mortgagor and grantor, as applicable, thereunder for the benefit of the Secured
Parties and to acknowledge and agree to the terms of the Intercompany Subordinated Note and (iii) the
Borrower shall have delivered to the Administrative Agent an officers certificate stating that such
merger, amalgamation or consolidation and any such supplements to the Guarantee and any Security
Document preserve the enforceability of the Guarantee and the perfection and priority of the Liens under
the applicable Security Documents;
(c) [reserved];
(d) any Restricted Subsidiary that is not a Credit Party may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower or
any other Restricted Subsidiary;

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(e) the Borrower or any Subsidiary of the Borrower may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to any Credit Party;
provided that the consideration for any such disposition by any Person other than a Guarantor shall not
exceed the fair value of such assets;
(f) any Restricted Subsidiary may liquidate or dissolve if (i) the Borrower
determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is
not materially disadvantageous to the Lenders and (ii) to the extent such Restricted Subsidiary is a Credit
Party, any assets or business of such Restricted Subsidiary not otherwise disposed of or transferred in
accordance with Section 10.4 or 10.5, or in the case of any such business, discontinued, shall be
transferred to, or otherwise owned or conducted by, a Credit Party after giving effect to such liquidation
or dissolution; and
(g) to the extent that no Payment Default or Event of Default has occurred and is
continuing or would result from the consummation of such Disposition, the Borrower and the Restricted
Subsidiaries may consummate a merger, dissolution, liquidation, consolidation or disposition, the purpose
of which is to effect a Disposition permitted pursuant to Section 10.4.
10.4. Limitation on Sale of Assets. The Borrower will not, and will not permit the
Restricted Subsidiaries to, (i) convey, sell, lease, assign, transfer or otherwise consummate the disposition
of any of its property, business or assets (including receivables and leasehold interests), whether now
owned or hereafter acquired or (ii) consummate the sale to any Person (other than to the Borrower or a
Subsidiary Guarantor) any shares owned by it of the Borrowers or any Restricted Subsidiarys Stock and
Stock Equivalents (each of the foregoing a Disposition), except that:
(a) the Borrower and the Restricted Subsidiaries may sell, transfer or otherwise
dispose of (i) obsolete, worn-out, scrap, used, or surplus or mothballed equipment (including any such
equipment that has been refurbished in contemplation of such disposition), vehicles and other assets to the
extent such assets are not necessary for the operation of the Borrowers and the Restricted Subsidiaries
business, (ii) inventory or goods (or other assets) held for sale in the ordinary course of business, (iii) cash
and Permitted Investments and (iv) assets for the purposes of charitable contributions or similar gifts to
the extent such assets are not material to the ability of the Borrower and the Restricted Subsidiaries, taken
as a whole, to conduct its business in the ordinary course;
(b) the Borrower and the Restricted Subsidiaries may make Dispositions of assets,
excluding any Disposition of accounts receivable except in connection with the Disposition of any
business to which such accounts receivable relate, for fair value; provided that (i) to the extent required,
the Net Cash Proceeds thereof to the Borrower and the Restricted Subsidiaries are promptly applied to the
prepayment of Term Loans or Delayed-Draw Term Loans as provided for in Section 5.2(a), (ii) after
giving effect to any such Disposition, no Default or Event of Default shall have occurred and be
continuing, (iii) the aggregate consideration for all Dispositions made in reliance on this Section 10.4(b),
when aggregated with the amount of Permitted Sale Leaseback transactions consummated pursuant to
Section 10.4(g), shall not exceed at any time 5% of Consolidated Total Assets (determined at the time of
each Disposition) for all such transactions consummated after the Closing Date, (iv) with respect to any
Disposition pursuant to this clause (b) for a purchase price in excess of $50,000,000, the Person making
such Disposition shall receive not less than 75% of such consideration in the form of cash or Permitted
Investments; provided that for the purposes of this subclause (iv) and Section 10.4(g) the following shall
be deemed to be cash (Deemed Cash): (A) any liabilities (as shown on the Borrowers or such
Restricted Subsidiarys most recent balance sheet provided hereunder or in the footnotes thereto) of the
Borrower or such Restricted Subsidiary, other than liabilities that are by their terms (1) subordinated to
the payment in cash of the Obligations or (2) not secured by the assets that are the subject of such

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Disposition, that are assumed by the transferee with respect to the applicable Disposition and for which
the Borrower and all of the Restricted Subsidiaries shall have been validly released by all applicable
creditors in writing, (B) any securities received by the Person making such Disposition from the purchaser
that are converted by such Person into cash (to the extent of the cash received) within 180 days following
the closing of the applicable Disposition, (C) any Designated Non-Cash Consideration received by the
Person making such Disposition having an aggregate fair market value, taken together with all other
Designated Non-Cash Consideration received pursuant to this Section 10.4(b) that is at that time
outstanding, not in excess of 1.5% of Consolidated Total Assets at the time of the receipt of such
Designated Non-Cash Consideration, with the fair market value of each item of Designated Non-Cash
Consideration being measured at the time received and without giving effect to subsequent changes in
value and (v) any non-cash proceeds received in the form of Real Estate, Indebtedness or Stock and Stock
Equivalents are pledged to the Collateral Agent to the extent required under Section 9.12 or 9.14;
(c) (i) the Borrower and the Restricted Subsidiaries may make Dispositions to the
Borrower or any other Credit Party and (ii) any Restricted Subsidiary that is not a Credit Party may make
Dispositions to the Borrower or any other Subsidiary of the Borrower; provided that with respect to any
such Dispositions, such sale, transfer or disposition shall be for fair value;
(d) the Borrower and any Restricted Subsidiary may effect any transaction permitted
by Section 10.3, 10.5 or 10.6;
(e) the Borrower and any Restricted Subsidiary may lease, sublease, license (only on
a non-exclusive basis with respect to any intellectual property) or sublicense (only on a non-exclusive
basis with respect to any intellectual property) real, personal or intellectual property in the ordinary course
of business;
(f) Dispositions of property (including like-kind exchanges) to the extent that (i)
such property is exchanged for credit against the purchase price of similar replacement property or (ii) the
proceeds of such Disposition are applied to the purchase price of such replacement property, in each case
under Section 1031 of the Code or otherwise;
(g) Dispositions pursuant to Permitted Sale Leaseback transactions in an aggregate
amount pursuant to this Section 10.4(g), when aggregated with the amount of Dispositions made pursuant
to Section 10.4(b), not to exceed the limitations set forth in Section 10.4(b).
(h) Dispositions of (i) Investments in joint ventures (regardless of the form of legal
entity) to the extent required by, or made pursuant to, customary buy/sell arrangements or put/call
arrangements between the joint venture parties set forth in joint venture arrangements and similar binding
arrangements or (ii) to joint ventures in connection with the dissolution or termination of a joint venture
to the extent required pursuant to joint venture and similar arrangements;
(i) Dispositions of Receivables Facility Assets in connection with any Permitted
Receivables Financing; provided that to the extent that any new Participating Receivables Grantor is
added to any Permitted Receivables Financing after the Closing Date, the Net Cash Proceeds of any
Dispositions of Receivables Facility Assets by such new Participating Receivables Grantor must be
promptly applied to the prepayment of Loans as provided for in Section 5.2(a) without giving effect to
any reinvestment rights under the definition of Net Cash Proceeds; provided, further, that no Net Cash
Proceeds shall be required to be used to prepay the Loans pursuant to Section 5.2(a) to the extent that any
new Participating Receivables Grantor replaces (by merger or otherwise) any existing Participating
Receivables Grantor and at the time of such replacement, the volume of Receivables Facility Assets sold
into any Permitted Receivables Financing does not increase as a result of such replacement;

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(j) Dispositions listed on Schedule 10.4;
(k) transfers of property subject to a Recovery Event or in connection with any
condemnation proceeding upon receipt of the Net Cash Proceeds of such Recovery Event or
condemnation proceeding;
(l) Dispositions of accounts receivable in connection with the collection or
compromise thereof;
(m) the Borrower and the Restricted Subsidiaries may make Dispositions (excluding
any Disposition of accounts receivable except in connection with the Disposition of any business to which
such accounts receivable relate), for fair value to the extent that (i) the aggregate consideration for all
such Dispositions consummated after the Closing Date, when combined with all Dispositions made
pursuant to Section 10.4(b), does not exceed 7.5% of Consolidated Total Assets (determined at the time
of each Disposition), (ii) the Net Cash Proceeds of any such Disposition are promptly applied to the
prepayment of Loans as provided in Section 5.2(a) without giving effect to any reinvestment rights under
the definition of Net Cash Proceeds; provided that, in the case of a Disposition of a Baseload Asset
pursuant to this Section 10.4(m), the Borrower shall be permitted to reinvest the Net Cash Proceeds
received in such Disposition in other Baseload Assets within the reinvestment periods set forth in the
definition of Net Cash Proceeds, (iii) after giving effect to any such Disposition, no Default or Event of
Default shall have occurred and be continuing, (iv) with respect to any Disposition pursuant to this
Section 10.4(m) for a purchase price in excess of $50,000,000, the Person making such Disposition shall,
subject to the parenthetical below, receive not less than 75% of such consideration in the form of cash or
Permitted Investments (or, to the extent that less than 75% of such consideration is in the form of cash or
Permitted Investments, the Borrower shall apply the amount of such difference to the prepayment of
Loans as provided in clause (ii) above); provided that for the purposes of this subclause (iv), Deemed
Cash shall be deemed to be cash and (v) any non-cash proceeds received in the form of Real Estate,
Indebtedness or Stock and Stock Equivalents are pledged to the Collateral Agent to the extent required
under Section 9.12 or 9.14;
(n) [reserved];
(o) Dispositions of power, capacity, heat rate, renewable energy credits, waste by-
products, energy, electricity, coal and lignite, oil and other petroleum-based liquids, emissions and other
environmental credits, ancillary services, fuel (including all forms of nuclear fuel and natural gas) and
other related assets or products of services, including assets related to trading activities or the sale of
inventory or contracts related to any of the foregoing, in each case in the ordinary course of business;
(p) the execution of (or amendment to), settlement of or unwinding of any Hedging
Agreement;
(q) any Disposition of mineral rights, other than mineral rights in respect of coal or
lignite;
(r) any Disposition of any real property that is (i) primarily used or intended to be
used for mining which has either been reclaimed, or has not been used for mining in a manner which
requires reclamation, and in either case has been determined by the Borrower not to be necessary for use
for mining, (ii) used as buffer land, but no longer serves such purpose, or its use is restricted such that it
will continue to be buffer land, or (iii) was acquired in connection with power generation facilities, but
has been determined by the Borrower to no longer be commercially suitable for such purpose;

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(s) any Disposition of any assets required by any Governmental Authority;
(t) any Disposition of assets in connection with salvage activities;
(u) any Disposition of assets pursuant to any First Day Orders or the order governing
de minimis asset dispositions, in each case to the extent approved by the J oint Lead Arrangers; and
(v) Dispositions of any asset between or among the Borrower and/or any Restricted
Subsidiary as a substantially concurrent interim Disposition in connection with a Disposition otherwise
permitted pursuant to clauses (a) through (t) above; provided that after giving effect to any such
Disposition, to the extent the assets subject to such Dispositions constituted Collateral, such assets shall
remain subject to, or be rejoined to, the Lien of the Security Documents.
10.5. Limitation on Investments. The Borrower will not, and will not permit the
Restricted Subsidiaries, to make any Investment except, subject to the Cash Management Order, the Tax
Order, the Wages Order and any other orders of the Bankruptcy Court:
(a) extensions of trade credit, asset purchases (including purchases of inventory, fuel
(including all forms of nuclear fuel), supplies, materials and equipment) and the licensing or contribution
of intellectual property pursuant to joint marketing arrangements or development agreements with other
Persons, in each case in the ordinary course of business (including in respect of construction or restoration
activities);
(b) Investments that were Permitted Investments when such Investments were made;
(c) loans and advances to officers, directors, employees and consultants of the
Borrower (or any direct or indirect parent thereof) or any Subsidiary of the Borrower (i) for reasonable
and customary business-related travel, entertainment, relocation and analogous ordinary business
purposes (including employee payroll advances), (ii) in connection with such Persons purchase of Stock
or Stock Equivalents of the Ultimate Parent (or any direct or indirect parent thereof; provided that, to the
extent such loans and advances are made in cash, the amount of such loans and advances used to acquire
such Stock or Stock Equivalents shall be contributed to the Borrower in cash) and (iii) for purposes not
described in the foregoing subclauses (i) and (ii); provided that the aggregate principal amount
outstanding pursuant to subclause (iii) shall not exceed $25,000,000 at any one time outstanding;
(d) Investments (i) existing on, or made pursuant to legally binding written
commitments in existence on, the Closing Date as set forth on Schedule 10.5 and any modifications,
extensions, renewals or reinvestments thereof and (ii) existing on the Closing Date of the Borrower or any
Restricted Subsidiary in the Borrower or any Subsidiary of the Borrower and any modification, extension,
renewal or reinvestment thereof, only to the extent that the amount of any Investment made pursuant to
this clause (d) does not at any time exceed the amount of such Investment set forth on Schedule 10.5;
(e) Investments received in connection with the bankruptcy or reorganization of
suppliers or customers and in settlement of delinquent obligations of, and other disputes with, customers
arising in the ordinary course of business or upon foreclosure with respect to any secured Investment or
other transfer of title with respect to any secured Investment;
(f) Investments to the extent that payment for such Investments is made with Stock
or Stock Equivalents (other than Disqualified Stock) of the Borrower (or any direct or indirect parent
thereof);

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(g) Investments (i) (A) by the Borrower or any Restricted Subsidiary in any Credit
Party, (B) between or among Restricted Subsidiaries that are not Credit Parties, and (C) consisting of
intercompany Investments incurred in the ordinary course of business in connection with the cash
management operations (including with respect to intercompany self-insurance arrangements) among the
Borrower and the Restricted Subsidiaries (provided that any such intercompany Investment in connection
with cash management arrangements by a Credit Party in a Subsidiary of the Borrower that is not a Credit
Party is in the form of an intercompany loan or advance and the Borrower or such Restricted Subsidiary
complies with Section 9.12 to the extent applicable, and subject in each case to the Cash Management
Orders); (ii) by Credit Parties in any Restricted Subsidiary that is not a Credit Party, to the extent that the
aggregate amount of all Investments made on or after the Closing Date pursuant to this subclause (ii),
when valued at the fair market value (determined by the Borrower acting in good faith) of each such
Investment at the time each such Investment was made, is not in excess of, when combined with, and
without duplication, the aggregate amount of Investments made pursuant to the proviso to Section 10.5(h)
an amount equal to the sum of (w) $200,000,000 plus (x) the Applicable Equity Amount at such time plus
(y) if no Event of Default has occurred and is continuing at the time the Investment is first made, the
Applicable Amount at such time plus (z) to the extent not otherwise included in the determination of the
Applicable Equity Amount or the Applicable Amount, an amount equal to any repayments, interest,
returns, profits, distributions, income and similar amounts actually received in cash in respect of any such
Investment (which amount referred to in this subclause (z) shall not exceed the amount of such
Investment valued at the fair market value of such Investment at the time such Investment was made)
(subject in each case to the Cash Management Order); and (iii) by Credit Parties in any Restricted
Subsidiary that is not a Credit Party so long as such Investment is part of a series of simultaneous
Investments by Restricted Subsidiaries in other Restricted Subsidiaries that result in the proceeds of the
initial Investment being invested in one or more Credit Parties;
(h) Investments constituting Permitted Acquisitions; provided that the aggregate
amount of any such Investment, as valued at the fair market value (determined by the Borrower acting in
good faith) of such Investment at the time each such Investment is made, made by the Borrower or any
Subsidiary Guarantor in any Restricted Subsidiary that, after giving effect to such Investment, shall not be
a Guarantor, shall not cause the aggregate amount of all such Investments made pursuant to this clause (h)
(as so valued at the time each such investment is made) to exceed, when combined with, and without
duplication of, the aggregate amount of Investments made pursuant to clause (ii) of Section 10.5(g), an
amount equal to the sum of (i) $200,000,000 plus (ii) the Applicable Equity Amount at such time plus
(iii) if no Event of Default has occurred and is continuing at the time such Investment is first made, the
Applicable Amount at such time plus (iv) to the extent not otherwise included in the determination of the
Investment (which amount referred to in this clause (iv) shall not exceed the amount of such Investment
valued at the fair market value of such Investment at the time such Investment was made);
(i) Investments (including but not limited to (i) Minority Investments and
Investments in Unrestricted Subsidiaries, (ii) Investments in joint ventures (regardless of the form of legal
entity) or similar Persons that do not constitute Restricted Subsidiaries and (iii) Investments in
Subsidiaries that are not Credit Parties), in each case valued at the fair market value (determined the
Borrower acting in good faith) of such Investment at the time each such Investment is made, in an
aggregate amount pursuant to this clause (i) that, at the time each such Investment is made, would not
exceed the sum of (w) $500,000,000 plus (x) the Applicable Equity Amount at such time plus (y) if no
Event of Default has occurred and is continuing at the time such Investment is first made, the Applicable
Amount at such time plus (z) to the extent not otherwise included in the determination of the Applicable
Equity Amount or the Applicable Amount, an amount equal to any repayments, interest, returns, profits,
distributions, income and similar amounts actually received in cash in respect of any such Investment

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(which amount referred to in this subclause (z) shall not exceed the amount of such Investment valued at
the fair market value of such Investment at the time such Investment was made);
(j) Investments constituting non-cash proceeds of Dispositions of assets to the extent
permitted by Section 10.4;
(k) Investments made to repurchase or retire Stock or Stock Equivalents of the
Borrower or any direct or indirect parent thereof owned by any employee or any stock ownership plan or
key employee stock ownership plan of the Borrower (or any direct or indirect parent thereof) in an
aggregate amount, when combined with distributions made pursuant to Section 10.6(b), not to exceed the
limitations set forth in such Section;
(l) Investments consisting of dividends permitted under Section 10.6;
(m) loans and advances to any direct or indirect parent of the Borrower in lieu of, and
not in excess of the amount of, dividends to the extent permitted to be made to such parent in accordance
with Section 10.6; provided that the aggregate amount of such loans and advances shall reduce the ability
of the Borrower and the Restricted Subsidiaries to make dividends under the applicable clauses of Section
10.6 by such amount;
(n) Investments consisting of extensions of credit in the nature of accounts
receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and
Investments received in satisfaction or partial satisfaction thereof from financially troubled account
debtors and other credits to suppliers in the ordinary course of business;
(o) Investments in the ordinary course of business consisting of endorsements for
collection or deposit and customary trade arrangements with customers consistent with past practices;
(p) advances of payroll payments to employees, consultants or independent
contractors or other advances of salaries or compensation to employees, consultants or independent
contractors, in each case in the ordinary course of business;
(q) Guarantee Obligations of the Borrower or any Restricted Subsidiary of leases
(other than Capital Leases) or of other obligations that do not constitute Indebtedness, in each case
entered into in the ordinary course of business;
(r) Investments held by a Person acquired (including by way of merger,
amalgamation or consolidation) after the Closing Date otherwise in accordance with this Section 10.5 to
the extent that such Investments were not made in contemplation of or in connection with such
acquisition, merger, amalgamation or consolidation and were in existence on the date of such acquisition,
merger, amalgamation or consolidation;
(s) Investments in Hedging Agreements permitted by Section 10.1;
(t) Investments arising out of, or in connection with, any Permitted Receivables
Financing;
(u) Investments consisting of deposits of cash and Permitted Investments as
collateral support permitted under Section 10.2;

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(v) other Investments, which, when aggregated with (i) all aggregate principal
amounts paid pursuant to Section 10.7(ii) from the Closing Date and (ii) all loans and advances made to
any direct or indirect parent of the Borrower pursuant to Section 10.5(m) in lieu of dividends permitted by
Section 10.6(c) and (iii) all dividends paid pursuant to Section 10.6(c), shall not exceed an amount equal
to (w) $250,000,000 plus (x) the Applicable Equity Amount at the time such Investments are made plus
(y) if no Event of Default has occurred and is continuing at the time such Investment is first made, the
Applicable Amount at such time plus (z) to the extent not otherwise included in the determination of the
Investment (which amount referred to in this subclause (z) shall not exceed the amount of such
Investment valued at the fair market value of such Investment at the time such Investment was made);
(w) to the extent constituting Investments, transactions pursuant to the Shared
Services Agreement, transactions pursuant to the Tax Sharing Agreements permitted under
Section 10.6(d)(i) or transactions disclosed in any Budget approved by Administrative Agent and the
J oint Lead Arrangers;
(x) Investments consisting of purchases and acquisitions of assets and services in the
ordinary course of business (including in respect of construction or restoration activities);
(y) Investments in the ordinary course of business consisting of Article 3
endorsements for collection or deposit and Article 4 customary trade arrangements with customers
consistent with past practice;
(z) to the extent constituting Investments, any payments made or obligations
acquired pursuant to the Wages Order;
(aa) Investments consisting of Indebtedness permitted by Section 10.1 (but only to the
extent such Indebtedness was permitted without reference to Section 10.5) or fundamental changes
permitted by Section 10.3;
(bb) Investments relating to pension trusts;
(cc) Investments by Credit Parties in any Restricted Subsidiary that is not a Credit
Party so long as such Investment is part of a series of simultaneous Investments by the Borrower and the
Restricted Subsidiaries in other Restricted Subsidiaries that result in the proceeds of the intercompany
Investment being invested in one or more Credit Parties;
(dd) Investments relating to nuclear decommission trusts and nuclear insurance and
self-insurance organizations or arrangements;
(ee) Investments in the form of, or pursuant to, operating agreements, working
interests, royalty interests, mineral leases, processing agreements, farm-out agreements, contracts for the
sale, transportation or exchange of oil and natural gas or other fuel or commodities, unitization
agreements, pooling agreements, area of mutual interest agreements, production sharing agreements or
other similar or customary agreements, transactions, properties, interests or arrangements, and
Investments and expenditures in connection therewith or pursuant thereto, in each case, made or entered
into in the ordinary course of business; and
(ff) Investments in wind or other renewable energy projects or in any nuclear power
or energy joint venture in an aggregate amount not to exceed $200,000,000 at any time outstanding;

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provided that, notwithstanding the definition of Excluded Stock and Stock Equivalents, all Stock and
Stock Equivalents representing any such Investment shall be pledged to the Collateral Agent for the
benefit of the Secured Parties.
Notwithstanding anything to the contrary contained in this Agreement, the Borrower and the Restricted
Subsidiaries may not rely on clause (g), (h), (i) or (j) of this Section 10.5 to directly or indirectly make an
Investment of all or any portion of one or more Baseload Generation Assets.
10.6. Limitation on Dividends. The Borrower will not declare or pay any dividends
(other than dividends payable solely in its Stock or Stock Equivalents (other than Disqualified Stock)) or
return any capital to its stockholders or make any other distribution, payment or delivery of property or
cash to its stockholders as such, or redeem, retire, purchase or otherwise acquire, directly or indirectly, for
consideration, any shares of any class of its Stock or Stock Equivalents or the Stock or Stock Equivalents
of any direct or indirect parent now or hereafter outstanding, or set aside any funds for any of the
foregoing purposes, or permit any Restricted Subsidiary to purchase or otherwise acquire for
consideration (other than in connection with an Investment permitted by Section 10.5) any Stock or Stock
Equivalents of the Borrower now or hereafter outstanding (all of the foregoing, dividends), provided,
subject to the Cash Management Order, the Tax Order and the Wages Order:
(a) the Borrower may (or may pay dividends to permit any direct or indirect parent
thereof to) redeem in whole or in part any of its Stock or Stock Equivalents for another class of its (or
such parents) Stock or Stock Equivalents or with proceeds from substantially concurrent equity
contributions or issuances of new Stock or Stock Equivalents; provided that (i) such new Stock or Stock
Equivalents contain terms and provisions at least as advantageous to the Lenders, taken as a whole, in all
respects material to their interests as those contained in the Stock or Stock Equivalents redeemed thereby
and (ii) the cash proceeds from any such contribution or issuance have not otherwise been applied
pursuant to the Applicable Equity Amount;
(b) so long as no Payment Default or Event of Default shall have occurred and is
continuing or would result therefrom, the Borrower may (or may pay dividends to permit any direct or
indirect parent thereof to) redeem, acquire, retire or repurchase shares of its (or such parents) Stock or
Stock Equivalents held by any present or former officer, manager, consultant, director or employee (or
their respective Affiliates, spouses, former spouses, successors, executors, administrators, heirs, legatees,
distributees, estates or immediate family members) of the Borrower (or any direct or indirect parent
thereof) and any Subsidiaries, so long as such repurchase is pursuant to, and in accordance with the terms
of, any stock option or stock appreciation rights plan, any management, director and/or employee benefit,
stock ownership or option plan, stock subscription plan or agreement, employment termination agreement
or any employment agreements or stockholders or shareholders agreement; provided, however, that the
aggregate amount of payments made under this Section 10.6(b) do not exceed in any calendar year
$25,000,000 (with unused amounts in any calendar year being carried over to succeeding calendar years
subject to a maximum (without giving effect to the following proviso) of $50,000,000 in any calendar
year); provided, further, that such amount in any calendar year may be increased by an amount not to
exceed:
(i) the cash proceeds from the sale of Stock (other than Disqualified Stock) of the
Borrower and, to the extent contributed to the Borrower, Stock of any of the Borrowers direct or
indirect parent companies, in each case to present or former officers, managers, consultants,
directors or employees (or their respective Affiliates, spouses, former spouses, successors,
executors, administrators, heirs, legatees, distributees, estates or immediate family members) of
the Borrower (or any of its direct or indirect parent companies) or any Subsidiary of the Borrower

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that occurs after the Closing Date, to the extent the cash proceeds from the sale of such Stock
have not otherwise been applied pursuant to the Applicable Equity Amount; plus
(ii) the cash proceeds of key man life insurance policies received the Borrower or
any Restricted Subsidiary after the Closing Date; less
(iii) the amount of any dividends or distributions previously made with the cash
proceeds described in clauses (i) and (ii) above;
and provided, further, that cancellation of Indebtedness owing to the Borrower or any Restricted
Subsidiary from present or former officers, managers, consultants, directors or employees (or their
respective Affiliates, spouses, former spouses, successors, executors, administrators, heirs, legatees,
distributees, estates or immediate family members) of the Borrower (or any of its direct or indirect parent
companies), or any Subsidiary of the Borrower in connection with a repurchase of Stock or Stock
Equivalents of the Borrower or any of its direct or indirect parent companies will not be deemed to
constitute a dividend for purposes of this covenant or any other provision of this Agreement;
(c) so long as no Payment Default or Event of Default shall have occurred and is
continuing or would result therefrom, the Borrower may pay dividends on its Stock or Stock Equivalents;
provided that the amount of all such dividends paid from the Closing Date pursuant to this clause (c),
when aggregated with (i) all aggregate principal amounts paid pursuant to Section 10.7 from the Closing
Date and (ii) (A) all loans and advances made to any direct or indirect parent of the Borrower pursuant to
Section 10.5(m) in lieu of dividends permitted by this clause (c) and (B) all Investments made pursuant to
Section 10.5(v), shall not exceed an amount equal to (x) $0 plus (y) the Applicable Equity Amount at the
time such dividends are paid;
(d) the Borrower may make dividends, distributions or loans to any direct or indirect
parent company of the Borrower in amount required for any such direct or indirect parent to pay, in each
case without duplication:
(i) foreign, federal, state and local income taxes, to the extent such income taxes are
attributable to the income of the Borrower and its Subsidiaries; provided that the amount of such
payments in any fiscal year does not exceed the amount that the Ultimate Parent and its
Subsidiaries are required to pay in respect of foreign, federal, state and local income taxes
attributable to the income of the Borrower and its Subsidiaries for such fiscal year;
(ii) (A) such parents and their respective Subsidiaries (other than the Oncor
Subsidiaries) general operating expenses incurred in the ordinary course of business and other
corporate overhead costs and expenses (including administrative, legal, accounting and similar
expenses provided by third parties), which are reasonable and customary and incurred in the
ordinary course of business and to the extent such costs and expenses are attributable to the
ownership or operation of the Borrower and its Subsidiaries, (B) any reasonable and customary
indemnification claims made by directors or officers of the Borrower (or any parent thereof and
such parents Subsidiaries (other than the Oncor Subsidiaries) to the extent such claims are
attributable to the ownership or operation of the Borrower and its Subsidiaries) or any Restricted
Subsidiary or (C) fees and expenses otherwise due and payable by the Borrower (or any parent
thereof and such parents Subsidiaries (other than the Oncor Subsidiaries) to the extent such fees
and expenses are attributable to the ownership or operation of the Borrower and its Subsidiaries)
or any Restricted Subsidiary and not prohibited to be paid by the Borrower and its Restricted
Subsidiaries hereunder;

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(iii) franchise and excise taxes and other fees, taxes and expenses required to
maintain the corporate existence of any direct or indirect parent of the Borrower;
(iv) to any direct or indirect parent of the Borrower to finance any Investment
permitted to be made by the Borrower or any Restricted Subsidiary pursuant to Section 10.5;
provided that (A) such dividend shall be made substantially concurrently with the closing of such
Investment, (B) such parent shall, immediately following the closing thereof, cause (1) all
property acquired (whether assets, Stock or Stock Equivalents) to be contributed to the Borrower
or such Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.5) of the
Person formed or acquired into the Borrower or any Restricted Subsidiary, (C) the Borrower shall
comply with Section 9.11 and Section 9.12 to the extent applicable and (D) the aggregate amount
of such dividends shall reduce the ability of the Borrower and the Restricted Subsidiary to make
Investments under the applicable clauses of Section 10.5 by such amount;
(v) customary costs, fees and expenses (other than to Affiliates) related to any
unsuccessful equity or debt offering or acquisition or disposition transaction payable by the
Borrower or the Restricted Subsidiaries; and
(vi) customary salary, bonus and other benefits payable to officers, employees or
consultants of any direct or indirect parent company (and such parents Subsidiaries (other than
the Oncor Subsidiaries)) of the Borrower to the extent such salaries, bonuses and other benefits
are attributable to the ownership or operation of the Borrower and its Subsidiaries;
(e) to the extent (if any) constituting dividends, transactions pursuant to the Shared
Services Agreement or described in any Budget approved by the Administrative Agent and the J oint Lead
Arrangers;
(f) to the extent constituting dividends, the Borrower may enter into and
consummate transactions expressly permitted by any provision of Section 10.3;
(g) the Borrower may repurchase Stock or Stock Equivalents of the Borrower (or any
direct or indirect parent thereof) deemed to occur upon exercise of stock options or warrants if such Stock
or Stock Equivalents represents a portion of the exercise price of such options or warrants, and the
Borrower may pay dividends to any direct or indirect parent thereof as and when necessary to enable such
parent to effect such repurchases;
(h) the Borrower may (i) pay cash in lieu of fractional shares in connection with any
dividend, split or combination thereof or any Permitted Acquisition and (ii) honor any conversion request
by a holder of convertible Indebtedness and make cash payments in lieu of fractional shares in connection
with any such conversion and may make payments on convertible Indebtedness in accordance with its
terms;
(i) the Borrower may pay any dividend or distribution within 60 days after the date
of declaration thereof, if at the date of declaration such payment would have complied with the provisions
of this Agreement;
(j) [reserved];
(k) the Borrower may pay dividends in an amount equal to withholding or similar
Taxes payable or expected to be payable by any present or former employee, director, manager or
consultant (or their respective Affiliates, estates or immediate family members) and any repurchases of

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Stock or Stock Equivalents in consideration of such payments including deemed repurchases in
connection with the exercise of stock options;
(l) [reserved];
(m) the Borrower may make payments described in Sections 9.9(a), 9.9(c), 9.9(f),
9.9(g), 9.9(h), 9.9(i), 9.9(k), 9.9(l) and 10.5(z);
(n) the Borrower may pay dividends or make distributions in connection with the
Transactions, including payments in respect of the Ultimate Parents and its Subsidiaries long term
incentive plan or in respect of tax gross-ups and other deferred compensation;
(o) [reserved];
(p) the Borrower may make distributions or payments of Receivables Fees;
(q) [reserved];
(r) [reserved];
(s) the Borrower may make distributions of, or Investments in, Receivables Facility
Assets for purposes of inclusion in any Permitted Receivables Financing, in each case made in the
ordinary course of business or consistent with past practices;
(t) the Borrower may make distributions, loans or other advances to Parent
Guarantor, in an amount not to exceed $125,000,000 in the aggregate for all such distributions, loans or
other advances made from the Closing Date solely to the extent that the proceeds of such distributions,
loans or other advances are used by Parent Guarantor to satisfy payment obligations (including, without
limitation, payment of principal, interest and any make-whole, prepayment or similar fees) owed by
Parent Guarantor under (i) the Tex-La Indebtedness and (ii) the CT Lease Indebtedness; provided that no
such distribution, loan or other advance shall be permitted pursuant to this clause (ii) unless (x) the
Borrower or the Restricted Subsidiary, as applicable, that is the lessee under the applicable CT Lease
retains its leasehold interest in respect of such CT Lease or (y) the assets subject to such CT Lease are
contributed to the Borrower or a Restricted Subsidiary; and
(u) the Borrower may make loans to, or permit letters of credit (including Letters of
Credit) to be issued on behalf of, any of its direct or indirect parent companies or such parents
Subsidiaries for working capital purposes or the cost of maintaining the headquarters building at Energy
Plaza, in each case so long as made in the ordinary course of business and consistent with past practices
and in an amount not to exceed $50,000,000.
Notwithstanding anything to the contrary contained in Section 10 (including Section 10.5 and this Section
10.6), the Borrower will not, and will not permit any of its Restricted Subsidiaries to, pay any cash
dividend or make any cash distribution on or in respect of the Borrowers Stock or Stock Equivalents or
purchase or otherwise acquire for cash any Stock or Stock Equivalents of the Borrower or any direct or
indirect parent of the Borrower, for the purpose of paying any cash dividend or making any cash
distribution to, or acquiring any Stock or Stock Equivalents of the Borrower or any direct or indirect
parent of the Borrower for cash from the Permitted Holders, or guarantee any Indebtedness of any
Affiliate of the Borrower for the purpose of paying such dividend, making such distribution or so
acquiring such Stock or Stock Equivalents to or from the Permitted Holders, in each case by means of
utilization of the cumulative dividend and investment credit provided by the use of the Applicable

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Amount or the exceptions provided by Sections 10.5(i), (m) and (v), and Section 10.7(ii), unless at the
time and after giving effect to such payment, no Event of Default has occurred and is continuing.
10.7. Limitation on Prepaying Indebtedness. Except as permitted by the terms and
conditions set forth in the Acceptable Reorganization Plan, the First Day Orders, the Orders or as
specifically permitted hereunder, Borrower shall not, and shall not permit the Restricted Subsidiaries to,
without the express prior written consent of the Required Lenders, make any payment or transfer with
respect to any Indebtedness incurred or arising prior to the filing of the Cases, whether by way of
adequate protection under the Bankruptcy Code or otherwise (in each case, other than any (i) to the
extent permitted under the Hedging and Trading Order, payments under any financial or physical trading
transaction, including commodities transactions and any payments under any Hedging Agreements, and
(ii) payments in an aggregate amount not to exceed the sum of (A) $200,000,000 and (B) the Applicable
Amount).
10.8. Limitations on Sale Leasebacks. The Borrower will not, and will not permit the
Restricted Subsidiaries to, enter into or effect any Sale Leasebacks after the Closing Date, other than
Permitted Sale Leasebacks.
10.9. Consolidated Superpriority Secured Net Debt to Consolidated EBITDA Ratio.
The Borrower will not permit the Consolidated Superpriority Secured Net Debt to Consolidated EBITDA
Ratio for any Test Period beginning with the Test Period ending on J une 30, 2014 to be greater than (x) if
the RCT Carve Out Support Rejection Notice has not been issued and delivered during or prior to such
Test Period, 3.50 to 1.00 and (y) for all other Test Periods, 4.50 to 1.00.
Any provision of this Agreement that contains a requirement for the Borrower to be in
compliance with the covenant contained in this Section 10.9 prior to the time that this covenant is
otherwise applicable shall be deemed to require that the Consolidated Superpriority Secured Net Debt to
Consolidated EBITDA Ratio for the applicable Test Period not be greater than (x) if the RCT Carve Out
Support Rejection Notice has not been issued and delivered during or prior to such Test Period, 3.50 to
1.00 and (y) for all other Test Periods, 4.50 to 1.00.
10.10. Changes in Business. The Borrower and the Restricted Subsidiaries, taken as a
whole, will not fundamentally and substantively alter the character of their business, taken as a whole,
from the business conducted by the Borrower and the Restricted Subsidiaries, taken as a whole, on the
Closing Date and other business activities incidental or reasonably related to any of the foregoing except
as required by the Bankruptcy Code or pursuant to the Interim Order or the Final Order.
10.11. Bankruptcy Provisions.
(a) Parent Guarantor and the Borrower shall not, and shall not permit any other
Credit Party or any other Restricted Subsidiary to, consent to the termination or reduction of the TCEH
Debtors exclusive plan filing and plan solicitation periods under section 1121 of the Bankruptcy Code
(the Exclusivity Periods) or fail to object to any motion by a party in interest (other than a Lender or
the Administrative Agent) seeking to terminate or reduce the Exclusivity Periods, in each case without the
prior written consent of the Administrative Agent.
(b) Parent Guarantor and the Borrower shall not, and shall not permit any other
Credit Party or any other Restricted Subsidiary to create or permit to exist any other Superpriority Claim
(other than the Carve Out, the RCT Reclamation Support Carve Out or the Obligations) or any claim
(as such word is defined in the Bankruptcy Code) that is pari passu with or senior to the claims of the
Secured Parties or any lien that is pari passu with or senior to the liens of the Secured Parties in any of the

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Cases except (A) with the prior written consent of the Administrative Agent or (B) to the extent such lien
constitutes a Permitted Lien securing Indebtedness or obligations not prohibited by this Agreement.
10.12. Affiliate Value Transfers. The Borrower will not, and will not permit the
Restricted Subsidiaries to, make any Affiliate Value Transfers in an aggregate amount in excess of
$50,000,000 for all such Affiliate Value Transfers made from the Closing Date.
SECTION 11. Events of Default.
Upon the occurrence of any of the following specified events (each an Event of
Default):
11.1. Payments. The Borrower shall (a) default in the payment when due of any
principal of the Loans or any Unpaid Drawings or (b) default, and such default shall continue for five or
more days, in the payment when due of any interest on the Loans or any Fees or any other amounts owing
hereunder or under any other Credit Document; or
11.2. Representations, Etc. Any representation, warranty or statement made or deemed
made by any Credit Party herein or in any other Credit Document or any certificate delivered or required
to be delivered pursuant hereto or thereto shall prove to be untrue in any material respect on the date as of
which made or deemed made; or
11.3. Covenants. Any Credit Party shall:
(a) default in the due performance or observance by it of any term, covenant or
agreement contained in Section 9.1(e), Section 9.5 (solely with respect to the Borrower), Section 9.15 or
Section 10; provided that an Event of Default under Section 10.9 shall not constitute an Event of Default
for purposes of any Term Loan or Delayed-Draw Term Loan, or result in the availability of any remedies
for the Term Loan Lenders or Delayed-Draw Term Loan Lenders, unless and until the Required
Revolving Credit Lenders have actually declared all Revolving Credit Loans and all related Obligations to
be immediately due and payable in accordance with this Agreement and such declaration has not been
rescinded on or before the date the Required Term Loan Lenders or Required Delayed-Draw Term Loan
Lenders declare an Event of Default with respect to Section 10.9; or
(b) default in the due performance or observance by it of any term, covenant or
agreement (other than those referred to in Section 11.1 or 11.2 or clause (a) of this Section 11.3)
contained in this Agreement or any other Credit Document and such default shall continue unremedied
for a period of at least 30 days after receipt of written notice by the Borrower from the Administrative
Agent or the Required Lenders; or
11.4. Default Under Other Agreements. (a) The Borrower or any Restricted Subsidiary
shall (i) default in any payment with respect to any Indebtedness incurred after the Petition Date (other
than any Indebtedness described in Section 11.1, Hedging Obligations or Indebtedness under any
Permitted Receivables Financing) in excess of $150,000,000 in the aggregate for the Borrower and such
Restricted Subsidiaries, beyond the period of grace, if any, provided in the instrument or agreement under
which such Indebtedness was created or (ii) default in the observance or performance of any agreement or
condition relating to any such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist (other than any agreement or
condition relating to, or provided in any instrument or agreement, under which such Hedging Obligations
or such Permitted Receivables Financing was created), in each case, after giving effect to any applicable
period of grace, the effect of which default or other event or condition is to cause, or to permit the holder

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or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, any
such Indebtedness to become due or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior to its
stated maturity; or (b) without limiting the provisions of clause (a) above, any such Indebtedness shall be
declared to be due and payable, or required to be prepaid other than by a regularly scheduled required
prepayment (other than any Hedging Obligations or Indebtedness under any Permitted Receivables
Financing) or as a mandatory prepayment, prior to the stated maturity thereof; provided that this clause
(b) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of
the property or assets securing such Indebtedness, if such sale or transfer is permitted hereunder and
under the documents providing for such Indebtedness; or
11.5. [Reserved].
11.6. ERISA. (a) Any Plan shall fail to satisfy the minimum funding standard required
for any plan year or part thereof or a waiver of such standard or extension of any amortization period is
sought or granted under Section 412 of the Code; any Plan is or shall have been terminated or is the
subject of termination proceedings under ERISA (including the giving of written notice thereof); an event
shall have occurred or a condition shall exist in either case entitling the PBGC to terminate any Plan or to
appoint a trustee to administer any Plan (including the giving of written notice thereof); any Plan shall
have an accumulated funding deficiency (whether or not waived); the Borrower or any ERISA Affiliate
has incurred or is likely to incur a liability to or on account of a Plan under Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201 or 4204 of ERISA or Section 4971 or 4975 of the Code (including the
giving of written notice thereof); (b) there could result from any event or events set forth in clause (a) of
this Section 11.6 the imposition of a Lien, the granting of a security interest, or a liability, or the
reasonable likelihood of incurring a Lien, security interest or liability; and (c) such Lien, security interest
or liability will or would be reasonably likely to have a Material Adverse Effect; or
11.7. Credit Documents. Any Credit Document or any material provision thereof shall
cease to be in full force and effect (other than pursuant to the terms hereof or thereof); or
11.8. [Reserved].
11.9. [Reserved].
11.10. [Reserved].
11.11. J udgments. Any single judgment in excess of $150,000,000 as to any post-
petition obligation, or any judgments that are in the aggregate in excess of $250,000,000 as to any one or
more post-petition obligations, shall be rendered against the TCEH Debtors and the enforcement thereof
shall not be stayed (by operation of law, the rules or orders of a court with jurisdiction over the matter or
by consent of the party litigants, in each case, to the extent not paid or covered by insurance provided by a
carrier not disputing coverage) or there shall be rendered against the TCEH Debtors a non-monetary
judgment with respect to a post-petition event that causes or is reasonably expected to cause a Material
Adverse Effect; provided, however, that this Section 11.11 shall not apply to any judgments as to any pre-
petition obligation; or
11.12. Hedging Agreements. The Borrower or any of the Restricted Subsidiaries shall
default (and have knowledge of such default) in any required payment obligation that is not being
contested in good faith and by appropriate proceedings by the Borrower or any Restricted Subsidiary
under any one or more Hedging Agreements entered into after the Petition Date and involving liabilities in
the aggregate in excess of $150,000,000 and payable by the Borrower and the Restricted Subsidiaries,

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after giving effect to any grace periods, dispute resolution provisions or similar provisions contained in
such Hedging Agreements; and such default shall not have been cured within 60 days after the date on
which the date on which the counterparty under such Hedging Agreement is permitted to cause the
obligation to become due and payable; or
11.13. Change of Control. A Change of Control shall occur; or
11.14. Final Order. The Final Order Entry Date shall not have occurred within 45 days
of the Interim Order Entry Date; or
11.15. Matters Related to the Cases.
(i) any of the Cases shall be dismissed or converted to a case under chapter 7 of the
Bankruptcy Code; or
(ii) a trustee, receiver, interim receiver, or manager shall be appointed in any of the
Cases, or a responsible officer or an examiner with enlarged powers shall be appointed in any of
the Cases (having powers beyond those set forth in sections 1106(a)(3) and 1106(a)(4) of the
Bankruptcy Code); or
(iii) Any other Superpriority Claim (other than the Carve Out, the RCT Reclamation
Support Carve Out or the Obligations) or any claim (as such word is defined in the Bankruptcy
Code) that is pari passu with or senior to the claims of the Secured Parties or any lien that is pari
passu with or senior to the liens of the Secured Parties shall be granted in any of the Cases except
(A) with the prior written consent of the Administrative Agent or (B) to the extent such lien
constitutes a Permitted Lien securing Indebtedness or obligations not prohibited by this
Agreement.
(iv) the Bankruptcy Court shall enter an order approving any claims for recovery of
amounts under section 506(c) of the Bankruptcy Code or otherwise arising from the preservation
of any Collateral; or
(v) any TCEH Debtor makes any material payments relating to prepetition
obligations (including any adequate protection payments) other than in accordance with the
First Day Orders, the Interim Order, the Final Order, Section 10.7 or as otherwise agreed to by
the Administrative Agent; or
(vi) the use of cash collateral by the TCEH Debtors shall be terminated and the
TCEH Debtors shall not have obtained use of cash collateral (consensually or non-consensually)
pursuant to an order in form and substance acceptable to the Left Lead Arrangers; or
(vii) the Credit Parties or any of their Subsidiaries, or any person claiming by or
through the Credit Parties or any of their Subsidiaries, shall obtain court authorization to
commence, or shall commence, join in, assist or otherwise participate as an adverse party in any
suit or other proceeding against any of the Administrative Agent or Lenders, in each case, relating
to the Credit Facilities; or
(viii) (i) Any TCEH Debtor shall file a motion or pleading or commence a proceeding
that could reasonably be expected to result in an impairment of the Administrative Agents or any
of the Lenders material rights or interests in their capacities as such under the Credit Facilities or
(ii) a determination by a court with respect to a motion, pleading or proceeding brought by

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another party that results in such an impairment; provided, however, that this subclause (viii) will
not apply to the termination of use of cash collateral (which shall be exclusively governed by
subclause (vi) above); or
(ix) the Bankruptcy Court shall enter a final non-appealable order that is adverse in
any material respect to the interests (taken as a whole) of the Administrative Agent or the Lenders
or their respective material rights and remedies in their capacity as such under the Credit
Facilities in any of the Cases; provided, however, that this subclause (viii) will not apply to the
termination of use of cash collateral (which shall be governed exclusively by subclause (vi)
above); or
(x) any TCEH Debtor shall file any pleading seeking, or otherwise consenting to, or
shall support or acquiesce in any other persons motion as to any matter set forth in Section
11.11, this Section 11.15 (other than this subclause (x)), Section 11.16, Section 11.17(i) and (ii),
or Section 11.18.
11.16. Automatic Stay. The Bankruptcy Court shall enter an order or orders granting
relief from the automatic stay applicable under section 362 of the Bankruptcy Code to any creditor or party
in interest to permit foreclosure (or the granting of a deed in lieu of foreclosure or the like) on any assets of
the TCEH Debtors that have an aggregate value in excess of $150,000,000; or
11.17. Status of Orders. (i) An order shall be entered reversing, supplementing, staying
for a period of five (5) Business Days or more, vacating or otherwise amending, supplementing or
modifying the Interim Order or the Final Order in a manner that is adverse to the interests of the
Administrative Agent or the Lenders, or the Borrower or any Guarantor shall apply for authority to do so,
without the prior written consent of the Administrative Agent or the Required Lenders, (ii) the Interim
Order or Final Order shall cease to create a valid and perfected lien on the Collateral or to be in full force
and effect; or (iii) the Borrower or any Guarantor shall fail to comply with the Orders in any material
respect; or
11.18. Confirmation of Plan. A plan shall be confirmed in any of the Cases that does not
provide for termination of the Commitments hereunder and the indefeasible payment in full in cash of the
Obligations (other than Contingent Obligations) on the effective date of such plan;
then, and in any such event, and at any time thereafter, if any Event of Default shall then
be continuing, subject in each case to the terms and conditions of the Interim Order and (once entered) the
Final Order, the Administrative Agent may and, upon the written request of the Required Lenders, shall,
by five calendar days written notice to the Borrower, take any or all of the following actions, without
prejudice to the rights of the Administrative Agent or any Lender to enforce its claims against the
Borrower, except as otherwise specifically provided for in this Agreement: (i) declare the Commitments
terminated, whereupon the Commitments, if any, of each Lender and each Letter of Credit Issuer shall
forthwith terminate immediately and any Fees theretofore accrued shall forthwith become due and payable
without any other notice of any kind; (ii) declare the principal of and any accrued interest and Fees in
respect of any or all Loans and any or all Obligations owing hereunder and under any other Credit
Document to be, whereupon the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and/or
(iii) terminate any Letter of Credit that may be terminated in accordance with its terms.
11.19. Application of Proceeds. Subject to the Carve Out and the RCT Reclamation
Support Carve Out, during the existence of an Event of Default any Net Cash Proceeds received by the
Collateral Agent, any distribution made in respect of any Collateral in any bankruptcy or insolvency

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proceeding of any Credit Party, all proceeds of any sale, collection or other liquidation of any Collateral,
including all insurance proceeds received in respect thereof, and all proceeds of any such distribution, and
any proceeds received by the Collateral Agent in respect of any sale of, collection from or other
realization upon all or any part of the Collateral pursuant to the exercise by the Collateral Agent of its
remedies shall be applied, in full or in part, together with any other sums then held by the Collateral
Agent pursuant to this Agreement and/or any other Credit Document, promptly as follows:
(a) with respect to any Collateral other than the RCT L/C Collateral Accounts and
the General L/C Collateral Accounts:
(i) First, to the payment of all reasonable costs and expenses, fees, commissions and
taxes of such sale, collection or other realization including compensation to the Administrative
Agent, Collateral Agent and their agents and counsel, and all expenses, liabilities and advances
made or incurred by the Administrative Agent and Collateral Agent in connection therewith and
all amounts for which the Administrative Agent and Collateral Agent is entitled to
indemnification pursuant to the provisions of any Credit Document, together with interest on each
such amount at the highest rate then in effect under this Agreement from and after the date such
amount is due, owing or unpaid until paid in full;
(ii) Second, to the payment of all other reasonable costs and expenses of such sale,
collection or other realization including all costs, liabilities and advances made or incurred by the
other Secured Parties in connection therewith, together with interest on each such amount at the
highest rate then in effect under this Agreement from and after the date such amount is due,
owing or unpaid until paid in full;
(iii) Third, without duplication of amounts applied pursuant to clauses (i) and (ii)
above, to the indefeasible payment in full in cash, pro rata, of interest and other amounts
constituting Obligations (other than principal, reimbursement obligations in respect of Letters of
Credit and obligations to cash collateralize Letters of Credit) and any fees, premiums and
scheduled periodic payments due under Secured Hedging Agreement, Secured Commodity
Hedging Agreements and Secured Cash Management Agreements to the extent constituting
Obligations and any interest accrued thereon (excluding any breakage, termination or other
payments thereunder), in each case equally and ratably in accordance with the respective amounts
thereof then due and owing;
(iv) Fourth, to the payment in full in cash, pro rata, of principal amount of the
Obligations (including reimbursement obligations in respect of Letters of Credit and obligations
to cash collateralize Letters of Credit) and any premium thereon and any breakage, termination or
other payments under Secured Hedging Agreement, Secured Commodity Hedging Agreements or
Secured Cash Management Agreements to the extent constituting Obligations and any interest
accrued thereon; and
(v) Fifth, the balance, if any, to the person lawfully entitled thereto (including the
applicable Credit Party or its successors or assigns) or as a court of competent jurisdiction may
direct.
(b) with respect to any RCT L/C Collateral Account:
(i) First, on a pro rata basis, to the payment of all amounts due to the relevant RCT
Letter of Credit Issuer under any of the Credit Documents, excluding amounts payable in
connection with any RCT Letter of Credit Reimbursement Obligation;

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(ii) Second, on a pro rata basis, to the payment of all amounts due to the relevant
RCT Letter of Credit Issuer in an amount equal to 100% of all relevant RCT Letter of Credit
Reimbursement Obligations;
(iii) Third, on a pro rata basis, to any Secured Party which has theretofore advanced
or paid any fees to the relevant RCT Letter of Credit Issuer, other than any amounts covered by
priority Second, an amount equal to the amount thereof so advanced or paid by such Secured
Party and for which such Secured Party has not been previously reimbursed;
(iv) Fourth, on a pro rata basis, to the payment of all other relevant RCT L/C
Obligations; and
(v) Last, the balance, if any, after all of the relevant RCT L/C Obligations have been
indefeasibly paid in full in cash, as set forth above in Section 11.19(a).
(c) with respect to any General L/C Collateral Account:
(i) First, on a pro rata basis, to the payment of all amounts due to the relevant
General Letter of Credit Issuer under any of the Credit Documents, excluding amounts payable in
connection with any General Letter of Credit Reimbursement Obligation;
(ii) Second, on a pro rata basis, to the payment of all amounts due to the relevant
General Letter of Credit Issuer in an amount equal to 100% of all General Letter of Credit
Reimbursement Obligations;
(iii) Third, on a pro rata basis, to any Secured Party which has theretofore advanced
or paid any fees to the relevant General Letter of Credit Issuer, other than any amounts covered
by priority Second, an amount equal to the amount thereof so advanced or paid by such Secured
Party and for which such Secured Party has not been previously reimbursed;
(iv) Fourth, on a pro rata basis, to the payment of all other relevant General L/C
Obligations; and
(v) Last, the balance, if any, after all of the relevant General L/C Obligations have
been indefeasibly paid in full in cash, as set forth above in Section 11.19(a).
In the event that any such proceeds are insufficient to pay in full the items described in clauses (a), (b)
and (c) of this Section 11.19, the Credit Parties shall remain liable, jointly and severally, for any
deficiency.
Notwithstanding anything to the contrary contained herein, any Event of Default under
this Agreement or similarly defined term under any other Credit Document, other than any Event of
Default which cannot be waived without the written consent of each Lender directly and adversely
affected thereby, shall be deemed not to be continuing if the events, act or condition that gave rise to
such Event of Default have been remedied or cured (including by payment, notice, taking of any action or
omitting to take any action) or have ceased to exist and the Borrower is in compliance with this
Agreement and/or such other Credit Document.

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SECTION 12. The Agents.
12.1. Appointment.
(a) Each Lender hereby irrevocably designates and appoints the Administrative
Agent as the agent of such Lender under this Agreement and the other Credit Documents and irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on its behalf under the
provisions of this Agreement and the other Credit Documents and to exercise such powers and perform
such duties as are expressly delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably incidental thereto. The
provisions of this Section 12 (other than Sections 12.9 and 12.13 with respect to the Borrower) are solely
for the benefit of the Agents and the Lenders, and the Borrower shall not have any rights as a third party
beneficiary of such provision. Notwithstanding any provision to the contrary elsewhere in this
Agreement, no Agent shall have any duties or responsibilities, except those expressly set forth herein or in
any other Credit Document, any fiduciary relationship with any Lender or any agency or trust obligations
with respect to any Credit Party, and no implied covenants, functions, responsibilities, duties, obligations
or liabilities shall be read into this Agreement or any other Credit Document or otherwise exist against
such Agent.
(b) The Administrative Agent, each Lender, each Hedge Bank with respect to any
Secured Commodity Hedging Agreement and the Letter of Credit Issuers hereby irrevocably designate
and appoint the Collateral Agent as the agent with respect to the Collateral, and each of the
Administrative Agent, each Lender and each Letter of Credit Issuer irrevocably authorizes the Collateral
Agent, in such capacity, to take such action on its behalf under the provisions of this Agreement and the
other Credit Documents and to exercise such powers and perform such duties as are expressly delegated
to the Collateral Agent by the terms of this Agreement and the other Credit Documents, together with
such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, the Collateral Agent shall not have any duties or responsibilities except
those expressly set forth herein or in any other Credit Document, any fiduciary relationship with any of
the Administrative Agent, the Lenders, or the Letter of Credit Issuers or any agency or trust obligations
with respect to any Credit Party, and no implied covenants, functions, responsibilities, duties, obligations
or liabilities shall be read into this Agreement or any other Credit Document or otherwise exist against the
Collateral Agent.
(c) Each of the Co-Syndication Agents, the J oint Lead Arrangers and the Co-
Documentation Agents, each in its capacity as such, shall not have any obligations, duties or
responsibilities under this Agreement but shall be entitled to all benefits of this Section 12.
12.2. Delegation of Duties. The Administrative Agent and the Collateral Agent may
each execute any of its duties under this Agreement and the other Credit Documents by or through agents,
sub-agents, employees or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Neither the Administrative Agent nor the Collateral Agent shall be
responsible for the negligence or misconduct of any agents, sub-agents or attorneys-in-fact selected by it
in the absence of gross negligence or willful misconduct (as determined in the final judgment of a court of
competent jurisdiction).
12.3. Exculpatory Provisions.
(a) No Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or Affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Credit Document (except for its or such Persons own

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gross negligence or willful misconduct, as determined in the final judgment of a court of competent
jurisdiction, in connection with its duties expressly set forth herein) or (ii) responsible in any manner to
any of the Lenders or any participant for any recitals, statements, representations or warranties made by
any of Parent Guarantor, the Borrower, any other Guarantor, any other Credit Party or any officer thereof
contained in this Agreement or any other Credit Document or in any certificate, report, statement or other
document referred to or provided for in, or received by such Agent under or in connection with, this
Agreement or any other Credit Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Credit Document, or the perfection or priority
of any Lien or security interest created or purported to be created under the Security Documents, or for
any failure of Parent Guarantor, the Borrower, any other Guarantor or any other Credit Party to perform
its obligations hereunder or thereunder. No Agent shall be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Credit Document, or to inspect the properties, books or records
of any Credit Party or any Affiliate thereof. The Collateral Agent shall not be under any obligation to the
Administrative Agent, any Lender or any Letter of Credit Issuer to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions of, this Agreement or any
other Credit Document, or to inspect the properties, books or records of any Credit Party.
(b) Each Lender confirms to the Administrative Agent, each other Lender and each
of their respective Related Parties that it (i) possesses (individually or through its Related Parties) such
knowledge and experience in financial and business matters that it is capable, without reliance on the
Administrative Agent, any other Lender or any of their respective Related Parties, of evaluating the merits
and risks (including tax, legal, regulatory, credit, accounting and other financial matters) of (x) entering
into this Agreement, (y) making Loans and other extensions of credit hereunder and under the other
Credit Documents and (z) in taking or not taking actions hereunder and thereunder, (ii) is financially able
to bear such risks and (iii) has determined that entering into this Agreement and making Loans and other
extensions of credit hereunder and under the other Credit Documents is suitable and appropriate for it.
(c) Each Lender acknowledges that (i) it is solely responsible for making its own
independent appraisal and investigation of all risks arising under or in connection with this Agreement
and the other Credit Documents, (ii) that it has, independently and without reliance upon the
Administrative Agent, any other Lender or any of their respective Related Parties, made its own appraisal
and investigation of all risks associated with, and its own credit analysis and decision to enter into, this
Agreement based on such documents and information, as it has deemed appropriate and (iii) it will,
independently and without reliance upon the Administrative Agent, any other Lender or any of their
respective Related Parties, continue to be solely responsible for making its own appraisal and
investigation of all risks arising under or in connection with, and its own credit analysis and decision to
take or not take action under, this Agreement and the other Credit Documents based on such documents
and information as it shall from time to time deem appropriate, which may include, in each case:
(i) the financial condition, status and capitalization of the Borrower and each other
Credit Party;
(ii) the legality, validity, effectiveness, adequacy or enforceability of this Agreement
and each other Credit Document and any other agreement, arrangement or document entered into,
made or executed in anticipation of, under or in connection with any Credit Document;
(iii) determining compliance or non-compliance with any condition hereunder to the
making of a Loan or the issuance of a Letter of Credit and the form and substance of all evidence
delivered in connection with establishing the satisfaction of each such condition; and

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(iv) the adequacy, accuracy and/or completeness of any information delivered by the
Administrative Agent, any other Lender or by any of their respective Related Parties under or in
connection with this Agreement or any other Credit Document, the transactions contemplated
hereby and thereby or any other agreement, arrangement or document entered into, made or
executed in anticipation of, under or in connection with any Credit Document.
12.4. Reliance by Agents. The Administrative Agent and the Collateral Agent shall be
entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telecopy, telex, electronic mail, or teletype message, statement, order or other
document or instruction believed by it to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal counsel (including counsel to Parent
Guarantor and/or the Borrower), independent accountants and other experts selected by the
Administrative Agent or the Collateral Agent. The Administrative Agent may deem and treat the Lender
specified in the Register with respect to any amount owing hereunder as the owner thereof for all
purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with
the Administrative Agent. The Administrative Agent and the Collateral Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Credit Document unless it shall
first receive such advice or concurrence of the Required Lenders as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and expense that may be
incurred by it by reason of taking or continuing to take any such action. The Administrative Agent and
the Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other Credit Documents in accordance with a request of the Required Lenders, and
such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders
and all future holders of the Loans; provided that the Administrative Agent and Collateral Agent shall not
be required to take any action that, in its opinion or in the opinion of its counsel, may expose it to liability
or that is contrary to any Credit Document or Applicable Law. For purposes of determining compliance
with the conditions specified in Sections 6 and 7 on the Closing Date, each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender
prior to the proposed Closing Date specifying its objection thereto.
12.5. Notice of Default. Neither the Administrative Agent nor the Collateral Agent
shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent or Collateral Agent, as applicable, has received notice from a
Lender, Parent Guarantor or the Borrower referring to this Agreement, describing such Default or Event
of Default and stating that such notice is a notice of default. In the event that the Administrative Agent
receives such a notice, it shall give notice thereof to the Lenders, the Administrative Agent and the
Collateral Agent. The Administrative Agent shall take such action with respect to such Default or Event
of Default as shall be reasonably directed by the Required Lenders; provided that unless and until the
Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of
Default as is within its authority to take under this Agreement and otherwise as it shall deem advisable in
the best interests of the Lenders except to the extent that this Agreement requires that such action be taken
only with the approval of the Required Lenders or each of the Lenders, as applicable.
12.6. Non-Reliance on Administrative Agent, Collateral Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent nor the Collateral Agent nor
any of their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any
representations or warranties to it and that no act by the Administrative Agent or Collateral Agent
hereinafter taken, including any review of the affairs of Parent Guarantor, the Borrower, any other

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Guarantor or any other Credit Party, shall be deemed to constitute any representation or warranty by the
Administrative Agent or Collateral Agent to any Lender or the Letter of Credit Issuer. Each Lender and
the Letter of Credit Issuer represents to the Administrative Agent and the Collateral Agent that it has,
independently and without reliance upon the Administrative Agent, Collateral Agent or any other Lender,
and based on such documents and information as it has deemed appropriate, made its own appraisal of
and investigation into the business, operations, property, financial and other condition and
creditworthiness of Parent Guarantor, the Borrower, each other Guarantor and each other Credit Party and
made its own decision to make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the Administrative Agent, Collateral
Agent or any other Lender, and based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Credit Documents, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial and other condition and
creditworthiness of Parent Guarantor, the Borrower, each other Guarantor and each other Credit Party.
Except for notices, reports and other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, neither the Administrative Agent nor the Collateral Agent shall have any
duty or responsibility to provide any Lender with any credit or other information concerning the business,
assets, operations, properties, financial condition, prospects or creditworthiness of Parent Guarantor, the
Borrower, any other Guarantor or any other Credit Party that may come into the possession of the
Administrative Agent or Collateral Agent any of their respective officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
12.7. Indemnification. The Lenders agree to indemnify each Agent, each in its capacity
as such (to the extent not reimbursed by the Credit Parties and without limiting the obligation of the
Credit Parties to do so), ratably according to their respective portions of the Total Credit Exposure in
effect on the date on which indemnification is sought (or, if indemnification is sought after the date upon
which the Commitments shall have terminated and the Loans shall have been paid in full, ratably in
accordance with their respective portions of the Total Credit Exposure in effect immediately prior to such
date), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever that may at any time occur (including at
any time following the payment of the Loans) be imposed on, incurred by or asserted against such Agent,
including all fees, disbursements and other charges of counsel to the extent required to be reimbursed by
the Credit Parties pursuant to Section 13.5, in any way relating to or arising out of the Commitments, this
Agreement, any of the other Credit Documents or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing (SUBJECT TO THE PROVISO BELOW,
WHETHER OR NOT CAUSED BY OR ARISING IN WHOLE OR IN PART, OUT OF THE
COMPARATIVE, CONTRIBUTORY OR SOLE ORDINARY NEGLIGENCE OF THE
INDEMNIFIED PERSON); provided that no Lender shall be liable to any Agent for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Agents gross negligence or willful misconduct as
determined by a final judgment of a court of competent jurisdiction; provided, further, that no action
taken in accordance with the directions of the Required Lenders (or such other number or percentage of
the Lenders as shall be required by the Credit Documents) shall be deemed to constitute gross negligence
or willful misconduct for purposes of this Section 12.7. In the case of any investigation, litigation or
proceeding giving rise to any liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time occur, be imposed upon,
incurred by or asserted against the Administrative Agent or the Collateral Agent in any way relating to or
arising out of the Commitments, this Agreement, any of the other Credit Documents or any documents
contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by such Agent under or in connection with any of the foregoing (including at any

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time following the payment of the Loans), this Section 12.7 applies whether any such investigation,
litigation or proceeding is brought by any Lender or any other Person. Without limitation of the
foregoing, each Lender shall reimburse such Agent upon demand for its ratable share of any costs or out-
of-pocket expenses (including attorneys fees) incurred by such Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice rendered in respect of rights or
responsibilities under, this Agreement, any other Credit Document, or any document contemplated by or
referred to herein, to the extent that such Agent is not reimbursed for such expenses by or on behalf of the
Borrower; provided that such reimbursement by the Lenders shall not affect the Borrowers continuing
reimbursement obligations with respect thereto. If any indemnity furnished to any Agent for any purpose
shall, in the opinion of such Agent, be insufficient or become impaired, such Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified against until such additional
indemnity is furnished; provided in no event shall this sentence require any Lender to indemnify any
Agent against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or
disbursement in excess of such Lenders pro rata portion thereof; and provided further, this sentence shall
not be deemed to require any Lender to indemnify any Agent against any liability, obligation, loss,
damage, penalty, action, judgment, suit, cost, expense or disbursement resulting from such Agents gross
negligence or willful misconduct (as determined by a final judgment of court of competent jurisdiction).
The agreements in this Section 12.7 shall survive the payment of the Loans and all other amounts payable
hereunder.
12.8. Agents in its Individual Capacities. Each Agent and its Affiliates may make loans
to, accept deposits from and generally engage in any kind of business with Parent Guarantor, the
Borrower, any other Guarantor, and any other Credit Party as though such Agent were not an Agent
hereunder and under the other Credit Documents. With respect to the Loans made by it, each Agent shall
have the same rights and powers under this Agreement and the other Credit Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms Lender and Lenders shall
include each Agent in its individual capacity.
12.9. Successor Agents. Each of the Administrative Agent and Collateral Agent may
resign at any time by notifying the other Agent, the Lenders, the Letter of Credit Issuers and the
Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right,
subject to the consent of the Borrower (not to be unreasonably withheld or delayed), to appoint a
successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with
an office in the United States. If no such successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring Agent gives notice of its
resignation, then the retiring Agent may on behalf of the Lenders and the Letter of Credit Issuers, appoint
a successor Agent meeting the qualifications set forth above; provided that if such Agent shall notify the
Borrower and the Lenders that no qualifying person has accepted such appointment, then such resignation
shall nonetheless become effective in accordance with such notice and (x) the retiring Agent shall be
discharged from its duties and obligations hereunder and under the other Credit Documents (except that in
the case of any collateral security held by the Collateral Agent on behalf of the Secured Parties under any
of the Credit Documents, the retiring Collateral Agent shall continue to hold such collateral security until
such time as a successor Collateral Agent is appointed) and (y) all payments, communications and
determinations provided to be made by, to or through such Agent shall instead be made by or to each
Lender and the Letter of Credit Issuer directly, until such time as the Required Lenders with (except after
the occurrence and during the continuation of a Default or Event of Default) the consent of the Borrower
(not to be unreasonably withheld) appoint successor Agents as provided for above in this paragraph.
Upon the acceptance of a successors appointment as the Administrative Agent or Collateral Agent, as the
case may be, hereunder, and upon the execution and filing or recording of such financing statements, or
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or notices, as may be necessary or desirable, or as the Required Lenders may request, in order to continue
the perfection of the Liens granted or purported to be granted by the Security Documents, such successor
shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or
retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations hereunder
or under the other Credit Documents (if not already discharged therefrom as provided above in this
Section). The fees payable by the Borrower (following the effectiveness of such appointment) to such
Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower
and such successor. After the retiring Agents resignation hereunder and under the other Credit
Documents, the provisions of this Section 12 (including 12.7) and Section 13.5 shall continue in effect for
the benefit of such retiring Agent, its sub-agents and their respective Related Parties in respect of any
actions taken or omitted to be taken by any of them while the retiring Agent was acting as an Agent.
12.10. Withholding Tax. To the extent required by any Applicable Law, the
Administrative Agent may withhold from any interest payment to any Lender an amount equivalent to
any applicable withholding tax. If the Internal Revenue Service or any authority of the United States or
other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form was not delivered, was
not properly executed, or because such Lender failed to notify the Administrative Agent or of a change in
circumstances that rendered the exemption from, or reduction of, withholding tax ineffective, or for any
other reason), such Lender shall indemnify the Administrative Agent (to the extent that the
Administrative Agent has not already been reimbursed by the Borrower (solely to the extent required by
this Agreement) and without limiting the obligation of the Borrower to do so) fully for all amounts paid,
directly or indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest,
together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket
expenses.
12.11. Trust Indenture Act. In the event that Citibank, N.A. or any of its Affiliates shall
be or become an indenture trustee under the Trust Indenture Act of 1939 (as amended, the Trust
Indenture Act) in respect of any securities issued or guaranteed by any Credit Party, and agree that any
payment or property received in satisfaction of or in respect of any Obligation of such Credit Party
hereunder or under any other Credit Document by or on behalf of Citibank, N.A., in its capacity as the
Administrative Agent or the Collateral Agent for the benefit of any Lender or Secured Party under any
Credit Document (other than Citibank, N.A. or an Affiliate of Citibank, N.A.) and which is applied in
accordance with the Credit Documents shall be deemed to be exempt from the requirements of Section
311 of the Trust Indenture Act pursuant to Section 311(b)(3) of the Trust Indenture Act.
12.12. [Reserved].
12.13. Security Documents and Guarantee. (a) Agents under Security Documents and
Guarantee. Each Secured Party hereby further authorizes the Administrative Agent or Collateral Agent,
as applicable, on behalf of and for the benefit of the Secured Parties, to be the agent for and representative
of the Secured Parties with respect to the Collateral and the Security Documents. Subject to Section 13.1,
without further written consent or authorization from any Secured Party, the Administrative Agent or
Collateral Agent, as applicable, may execute any documents or instruments necessary to in connection
with a sale or disposition of assets permitted by this Agreement, (i) release any Lien encumbering any
item of Collateral that is the subject of such sale or other disposition of assets, or with respect to which
Required Lenders (or such other Lenders as may be required to give such consent under Section 13.1)
have otherwise consented or (ii) release any Guarantor from the Guarantee, or with respect to which
Required Lenders (or such other Lenders as may be required to give such consent under Section 13.1)
have otherwise consented.

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(b) Right to Realize on Collateral and Enforce Guarantee. Anything contained in
any of the Credit Documents to the contrary notwithstanding, Parent Guarantor, the Borrower, the Agents
and each Secured Party hereby agree that (i) no Secured Party shall have any right individually to realize
upon any of the Collateral or to enforce the Guarantee, it being understood and agreed that all powers,
rights and remedies hereunder may be exercised solely by the Administrative Agent, on behalf of the
Lenders in accordance with the terms hereof and all powers, rights and remedies under the Security
Documents and Guarantee may be exercised solely by the Collateral Agent, on behalf of the Secured
Parties, and (ii) in the event of a foreclosure by the Collateral Agent on any of the Collateral pursuant to a
public or private sale or other disposition, the Collateral Agent or any Secured Party may be the purchaser
or licensor of any or all of such Collateral at any such sale or other disposition and the Collateral Agent,
as agent for and representative of the Secured Parties (but not any Lender or Lenders in its or their
respective individual capacities unless Required Lenders shall otherwise agree in writing) shall be
entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any
portion of the Collateral sold at any such public sale, to use and apply any of the Obligations as a credit
on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other
disposition.
SECTION 13. Miscellaneous.
13.1. Amendments, Waivers and Releases. Neither this Agreement nor any other
Credit Document, nor any terms hereof or thereof, may be amended, supplemented or modified except in
accordance with the provisions of this Section 13.1. The Required Lenders may, or, with the written
consent of the Required Lenders, the Administrative Agent and/or the Collateral Agent may, from time to
time, (a) enter into with the relevant Credit Party or Credit Parties written amendments, supplements or
modifications hereto and to the other Credit Documents for the purpose of adding any provisions to this
Agreement or the other Credit Documents or changing in any manner the rights of the Lenders or of the
Credit Parties hereunder or thereunder or (b) waive in writing, on such terms and conditions as the
Required Lenders or the Administrative Agent and/or Collateral Agent, as the case may be, may specify
in such instrument, any of the requirements of this Agreement or the other Credit Documents or any
Default or Event of Default and its consequences; provided, however, that each such waiver and each
such amendment, supplement or modification shall be effective only in the specific instance and for the
specific purpose for which given; and provided, further, that no such waiver and no such amendment,
supplement or modification shall:
(i) forgive or reduce any portion of any Loan or extend the final scheduled maturity
date of any Loan or reduce the stated rate (it being understood that only the consent of the
Required Lenders shall be necessary to waive any obligation of the Borrower to pay interest or
principal at the Default Rate or amend Section 2.8(d)), or forgive any portion, or extend the date
for the payment, of any interest or Fee payable hereunder (other than as a result of waiving the
applicability of any post-default increase in interest rates, or the applicability of the most
favorable nation clause in respect of any Incremental Facility), or extend the final expiration
date of any Lenders Commitment or extend the final expiration date of any Letter of Credit
beyond the General L/C Termination Date or the RCT L/C Termination Date, as applicable, or
increase the aggregate amount of the Commitments of any Lender, or amend or modify any
provisions of Section 5.3(a) (with respect to the ratable allocation of any payments only) and
13.8(a) and 13.19 or make any Loan, interest, Fee or other amount payable in any currency other
than expressly provided herein, in each case without the written consent of each Lender directly
and adversely affected thereby; provided that the Extension Conditions (other than the Extension
Conditions set forth under clauses (1) (solely with respect to an Event of Default under Section
11.1) and (6) of the definition thereof) may be amended, supplemented or modified or waived
with the written consent of the Required Lenders, or

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(ii) amend, modify or waive any provision of this Section 13.1 or reduce the
percentages specified in the definition of the term Required Lenders, Required Revolving
Credit Lenders, Required Delayed-Draw Term Loan Lenders or Required Term Loan
Lenders, consent to the assignment or transfer by Parent Guarantor or the Borrower of their
respective rights and obligations under any Credit Document to which it is a party (except as
permitted pursuant to Section 10.3) or alter the order of application set forth in Section 5.2(c)(i),
in each case without the written consent of each Lender directly and adversely affected thereby,
or
(iii) amend, modify or waive any provision of Section 12 without the written consent
of the then-current Administrative Agent and Collateral Agent or any other former or current
Agent to whom Section 12 then applies in a manner that directly and adversely affects such
Person, or
(iv) amend, modify or waive any provision of Section 3 (or amend, modify or waive
any defined term in such Section 3, or any underlying definition thereto, in each case in a manner
directly adverse to any Letter of Credit Issuer in its capacity as such) without the written consent
of the applicable Letter of Credit Issuer in its capacity as such, or
(v) amend, waive or otherwise modify any term or provision of Section 10.9 or 11.3
(solely as it relates to Section 10.9), or the definition of Consolidated Superpriority Secured Net
Debt to Consolidated EBITDA Ratio (or any of its component definitions (as used in such
Section but not as used in other Sections of this Agreement)), without the written consent of the
Required Revolving Credit Lenders (it being understood and agreed that the consent of no other
Lender shall be required to amend, waive or modify any such terms or provision), or
(vi) change any Revolving Credit Commitment to an Incremental Term Loan
Commitment, or change any Incremental Term Loan Commitment to a Revolving Credit
Commitment, in each case without the prior written consent of each Lender directly and
adversely affected thereby, or
(vii) release all or substantially all of the Guarantors under the Guarantee (except as
expressly permitted by the Guarantee or this Agreement) or release all or substantially all of the
Collateral under the Security Documents (except as expressly permitted by the Security
Documents or this Agreement), in either case without the prior written consent of each Lender, or
(viii) amend Section 2.9 (or any related definitions) so as to permit Interest Period
intervals greater than six months without regard to availability to Lenders, without the written
consent of each Lender directly and adversely affected thereby, or
(ix) affect the rights or duties of, or any Fees or other amounts payable to, any Agent
under this Agreement or any other Credit Document without the prior written consent of such
Agent, or
(x) decrease the amount or allocation of any mandatory prepayment to be received
by any Term Loan Lender (other than Term Loan Lenders holding Incremental Term Loans)
without the written consent of the Required Term Loan Lenders (but not including in such
calculation any Incremental Term Loans), or

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(xi) decrease the amount or allocation of any mandatory prepayment to be received
by any Delayed-Draw Term Loan Lender without the written consent of the Required Delayed-
Draw Term Loan Lenders, or
(xii) waive the provisions of the proviso of Section 2.14(d) without the written
consent of the Non-Defaulting Lenders having or holding a majority of the sum of (a) the
aggregate outstanding principal amount of the Term Loans (excluding Term Loans held by
Defaulting Lenders) at such date plus (b) the aggregate outstanding principal amount of the
Delayed-Draw Term Loans (excluding Delayed Draw Term Loans held by Defaulting Lenders) at
such date plus (c) the Adjusted Available Delayed Draw Term Loan Commitment at such date
(but not including in such calculation any Incremental Term Loans, and it being understood and
agreed that the consent of no other Lender shall be required to waive such provisions), or
(xiii) waive the provisions of the proviso of Section 2.14(i)(ii) without the written
consent of the Required Revolving Credit Lenders (but not including in such calculation any New
Revolving Credit Commitments), or
(xiv) increase the maximum amount of the RCT Reclamation Support Carve Out.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the affected Lenders and shall be binding upon Parent Guarantor, the Borrower, the
applicable Credit Parties, such Lenders, the Administrative Agent and all future holders of the affected
Loans.
In the case of any waiver, Parent Guarantor, the Borrower, the applicable Credit Parties,
the Lenders, the Administrative Agent shall be restored to their former positions and rights hereunder and
under the other Credit Documents, and any Default or Event of Default waived shall be deemed to be
cured and not continuing, it being understood that no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereon. In connection with the foregoing
provisions, the Administrative Agent may, but shall have no obligations to, with the concurrence of any
Lender, execute amendments, modifications, waivers or consents on behalf of such Lender.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any
right to approve or disapprove any amendment, modification, supplement, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended without the consent of such
Lender (it being understood that any Commitments, Loans held or deemed held by any Defaulting Lender
shall be excluded for a vote of the Lenders hereunder requiring any consent of the Lenders, except as
expressly provided for by this Agreement).
Notwithstanding the foregoing, in addition to any credit extensions and related
Incremental Amendment(s) effectuated without the consent of Lenders in accordance with Section 2.14,
this Agreement may be amended (or amended and restated) with the written consent of the Required
Lenders, the Administrative Agent, Parent Guarantor and the Borrower (a) to add one or more additional
credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding
thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of this
Agreement and the other Credit Documents with the Loans and Commitments and the accrued interest
and Fees in respect thereof and (b) to include appropriately the Lenders holding such credit facilities in
any determination of the Required Lenders and other definitions related to such new Loans and
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In addition, notwithstanding the foregoing, (i) the Administrative Agent, the Collateral
Agent and the relevant Credit Parties may amend, supplement or modify the Security Documents to make
such ministerial changes as may be required to effect the provisions of Section 10.2(a) without the
consent of any Lender so long as such amendments do not adversely affect the Lenders and (ii) the
Administrative Agent, the Collateral Agent and the relevant Credit Parties may amend, supplement or
modify this Agreement or any of the Security Documents and any other document delivered in connection
therewith at the request of the Borrower without the need to obtain the consent of any other Lender if
such amendment, supplement or waiver is delivered in order (i) to comply with local law or advice of
local counsel, (ii) to cure ambiguities, omissions, mistakes or defects, (iii) to cause such any such Security
Document or other document to be consistent with this Agreement and the other Credit Documents or (iv)
add syndication or documentation agents and make customary changes and references related thereto.
In addition, notwithstanding the foregoing, the Administrative Agent may amend,
supplement or modify the last sentence of the definition of Delayed-Draw Term Loans, the last
sentence of the definition of Term Loans, Section 2.1(a)(ii), Section 2.1(b)(ii) and related provisions to
make such ministerial changes as may be required to make the Delayed-Draw Term Loans and the Term
Loans fungible for loan trading purposes, or to remove such provisions if the Administrative Agent
reasonably determines that the Delayed-Draw Term Loans and the Term Loans will not be fungible for
loan trading purposes.
The Lenders hereby irrevocably agree that the Liens granted to the Collateral Agent by
the Credit Parties on any Collateral shall be automatically released (i) in full, upon the Obligations
(except for Hedging Obligations in respect of any Secured Hedging Agreement and/or any Secured
Commodity Hedging Agreement, Cash Management Obligations in respect of Secured Cash Management
Agreements and Contingent Obligations) having been indefeasibly paid in full, in cash, all Commitments
having been terminated, and all Letters of Credit having been cancelled (or all such Letters of Credit
having been fully cash collateralized or otherwise back-stopped, in each case to the satisfaction of the
applicable Letter of Credit Issuers), (ii) upon the sale or other disposition of such Collateral (including as
part of or in connection with any other sale or other disposition permitted hereunder) to any Person other
than another Credit Party, to the extent such sale or other disposition is made in compliance with the
terms of this Agreement (and the Collateral Agent may rely conclusively on a certificate to that effect
provided to it by any Credit Party upon its reasonable request without further inquiry), (iii) to the extent
such Collateral is comprised of property leased to a Credit Party, upon termination (in accordance with
the terms of this Agreement) or expiration of such lease, (iv) if the release of such Lien is approved,
authorized or ratified in writing by the Required Lenders (or such other percentage of the Lenders whose
consent may be required in accordance with this Section 13.1), (v) to the extent the property constituting
such Collateral is owned by any Subsidiary Guarantor, upon the release of such Subsidiary Guarantor
from its obligations under the Guarantee (in accordance with the following sentence) and (vi) as required
to effect any sale or other disposition of Collateral in connection with any exercise of remedies of the
Collateral Agent pursuant to the Credit Documents. Any such release shall not in any manner discharge,
affect or impair the Obligations or any Liens (other than those being released) upon (or obligations (other
than those being released) of the Credit Parties in respect of) all interests retained by the Credit Parties,
including the proceeds of any sale, all of which shall continue to constitute part of the Collateral except to
the extent otherwise released in accordance with the provisions of the Credit Documents. Additionally,
the Lenders hereby irrevocably agree that the Subsidiary Guarantors shall be released from the Guarantee
upon consummation of any transaction resulting in such Subsidiary ceasing to constitute a Restricted
Subsidiary. The Lenders hereby authorize the Administrative Agent and the Collateral Agent, as
applicable, to execute and deliver any instruments, documents, and agreements necessary or desirable to
evidence and confirm the release of any Subsidiary Guarantor or Collateral pursuant to the foregoing
provisions of this paragraph, all without the further consent or joinder of any Lender.

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13.2. Notices. Unless otherwise expressly provided herein, all notices and other
communications provided for hereunder or under any other Credit Document shall be in writing
(including by facsimile or other electronic transmission). All such written notices shall be mailed, faxed
or delivered to the applicable address, facsimile number or electronic mail address, and all notices and
other communications expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(a) if to Parent Guarantor, the Borrower, the Administrative Agent, the Collateral
Agent or any Letter of Credit Issuer, to the address, facsimile number, electronic mail address or
telephone number specified for such Person on Schedule 13.2 or to such other address, facsimile number,
electronic mail address or telephone number as shall be designated by such party in a notice to the other
parties; and
(b) if to any other Lender, to the address, facsimile number, electronic mail address
or telephone number specified in its Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be designated by such party in a notice to
Parent Guarantor, the Borrower, the Administrative Agent and the Collateral Agent.
All such notices and other communications shall be deemed to be given or made upon the earlier to occur
of (i) actual receipt by the relevant party hereto and (ii) (A) if delivered by hand or by courier, when
signed for by or on behalf of the relevant party hereto; (B) if delivered by mail, three Business Days after
deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent and receipt has been
confirmed by telephone; and (D) if delivered by electronic mail, when delivered; provided that notices
and other communications to the Administrative Agent or the Lenders pursuant to Sections 2.3, 2.6, 2.9,
4.2 and 5.1 shall not be effective until received.
13.3. No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Administrative Agent, the Collateral Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Credit Documents shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.
13.4. Survival of Representations and Warranties. All representations and warranties
made hereunder, in the other Credit Documents and in any document, certificate or statement delivered
pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement and
the making of the Loans hereunder.
13.5. Payment of Expenses; Indemnification. The Borrower agrees (a) to pay or
reimburse the Agents, the J oint Lead Arrangers, the Letter of Credit Issuers and the Lenders for all their
reasonable and documented out-of-pocket costs and expenses incurred in connection with the
development, negotiation, preparation and execution and delivery of, and any amendment, supplement or
modification to, this Agreement and the other Credit Documents and any other documents prepared in
connection herewith or therewith, the syndication of the Credit Facilities, the consummation and
administration of the transactions contemplated hereby and thereby, any Event of Default or the
enforcement or preservation of any rights under this Agreement, the other Credit Documents and any such
other documents, including the reasonable and documented out-of-pocket Prepetition and post-Petition
Date fees, disbursements and other charges of Advisors; (b) to pay, indemnify, and hold harmless each
Agent, each J oint Lead Arranger, each Letter of Credit Issuer and each Lender from, any and all recording
and filing fees and (c) to pay, indemnify, and hold harmless each Agent, each J oint Lead Arranger, each

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Letter of Credit Issuer and their respective Affiliates, directors, officers, partners, employees and agents
from and against any and all other liabilities, obligations, losses, damages, penalties, claims, demands,
actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever, including
reasonable and documented out-of-pocket fees, disbursements and other charges of Advisors, related to
the Transactions (including the Cases) or, with respect to the execution, delivery, enforcement,
performance and administration of this Agreement, the other Credit Documents and any such other
documents, including, any of the foregoing relating to the violation of, noncompliance with or liability
under, any Environmental Law (other than by such indemnified Person or any of its Related Parties (other
than trustees and advisors)) or to any actual or alleged presence, release or threatened release into the
environment of Hazardous Materials attributable to the operations of Parent Guarantor, the Borrower, any
of the Borrowers Subsidiaries or any of the Real Estate (all the foregoing in this clause (c), collectively,
the indemnified liabilities) (SUBJECT TO THE PROVISO BELOW, WHETHER OR NOT
CAUSED BY OR ARISING IN WHOLE OR IN PART, OUT OF THE COMPARATIVE,
CONTRIBUTORY OR SOLE ORDINARY NEGLIGENCE OF THE INDEMNIFIED PERSON);
provided that neither the Borrower nor any other Credit Party shall have any obligation hereunder to any
Agent, any Letter of Credit Issuer or any Lender or any of their respective Related Parties with respect to
indemnified liabilities to the extent they result from (A) the gross negligence, bad faith or willful
misconduct of such indemnified Person or any of its Related Parties, as determined by a final non-
appealable judgment of a court of competent jurisdiction, (B) a material breach of the obligations of such
indemnified Person or any of its Related Parties under the Credit Documents, as determined by a final
non-appealable judgment of a court of competent jurisdiction or (C) disputes not involving an act or
omission of Parent Guarantor, the Borrower or any other Credit Party and that is brought by an
indemnified Person against any other indemnified Person, other than any claims against any indemnified
Person in its capacity or in fulfilling its role as an Agent or J oint Lead Arranger or any similar role under
the Credit Facilities. The agreements in this Section 13.5 shall survive repayment of the Loans and all
other amounts payable hereunder.
All amounts payable under this Section 13.5 shall be paid within ten days of receipt by
the Borrower of an invoice relating thereto setting forth such expense in reasonable detail; provided, that
the TCEH Debtors shall promptly provide copies of invoices received on account of fees and expenses of
the professionals retained as provided for in the Credit Documents to counsel to the Steering Committee
and the United States Trustee, and the Bankruptcy Court shall have exclusive jurisdiction over any
objections raised to the invoiced amount of the fees and expenses proposed to be paid, which objections
may only be raised within ten days after receipt thereof. In the event that within ten days from receipt of
such invoices, the Credit Parties, the United States Trustee or counsel to the Steering Committee raise an
objection to a particular invoice, and the parties are unable to resolve any dispute regarding the fees and
expenses included in such invoice, the Bankruptcy Court shall hear and determine such dispute; provided,
that payment of invoices shall not be delayed based on any such objections and the relevant professional
shall only be required to disgorge amounts objected to upon being so ordered pursuant to a final order
of the Bankruptcy Court.
No Credit Party nor any indemnified Person shall have any liability for any special,
punitive, indirect or consequential damages resulting from this Agreement or any other Credit Document
or arising out of its activities in connection herewith or therewith (whether before or after the Closing
Date) (except, in the case of the Borrowers obligation hereunder to indemnify and hold harmless the
indemnified Persons, to the extent any indemnified Persons is found liable for special, punitive, indirect
or consequential damages to a third party). No indemnified Persons shall be liable for any damages
arising from the use by unintended recipients of any information or other materials distributed by it
through telecommunications, electronic or other information transmission systems in connection with this
Agreement or the other Credit Documents or the transactions contemplated hereby or thereby, except to
the extent that such damages have resulted from the willful misconduct, bad faith or gross negligence of

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any indemnified Person or any of its Related Parties (as determined by a final non-appealable judgment of
a court of competent jurisdiction). This Section 13.5 shall not apply to Taxes.
13.6. Successors and Assigns; Participations and Assignments.
(a) The provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate
of a Letter of Credit Issuer that issues any Letter of Credit), except that (i) except as expressly permitted
by Section 10.3, neither Parent Guarantor nor the Borrower may assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Administrative Agent and each
Lender (and any attempted assignment or transfer by Parent Guarantor or the Borrower without such
consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section 13.6. Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby (including any Affiliate of a Letter of Credit Issuer that issues any Letter of
Credit), Participants (to the extent provided in clause (c) of this Section 13.6), to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent, the Collateral Agent, the
Letter of Credit Issuers and the Lenders and each other Person entitled to indemnification under Section
13.5 and, to the extent expressly contemplated by Section 13.20, the Oncor Subsidiaries) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in clause (b)(ii) below, any Lender may at
any time assign to one or more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans at the time owing to it) with the
prior written consent (such consent not be unreasonably withheld or delayed; it being understood that,
without limitation, the Borrower shall have the right to withhold or delay its consent to any assignment if
in order for such assignment to comply with Applicable Law, the Borrower would be required to obtain
the consent of, or make any filing or registration with, any Governmental Authority) of:
(A) the Borrower (which consent shall not be unreasonably withheld or delayed);
provided that no consent of the Borrower shall be required for an assignment (1) to a Lender
(other than in respect of an assignment of a Revolving Credit Commitment and Revolving Credit
Loans), an Affiliate of a Lender (other than in respect of an assignment of a Revolving Credit
Commitment and Revolving Credit Loans (except to an Affiliate of such Revolving Credit
Lender having a combined capital and surplus of not less than the greater of (x) $100,000,000 and
(y) an amount equal to twice the amount of Revolving Credit Commitments to be held by such
assignee after giving effect to such assignment, in which case no such Borrower consent shall be
required) or an Approved Fund (other than in respect of an assignment of a Revolving Credit
Commitment and Revolving Credit Loans) or (2) if Specified Default has occurred and is
continuing with respect to the Borrower, to any other assignee; and
(B) the Administrative Agent (which consent shall not be unreasonably withheld or
delayed); provided that no consent of the Administrative Agent shall be required for any
assignment of any Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund.
Notwithstanding the foregoing or any other term or condition herein to the contrary, no
such assignment shall be made to (x) a natural person or (y) a Disqualified Institution.
(ii) Assignments shall be subject to the following additional conditions:

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(A) except (i) in the case of an assignment to a Lender, an Affiliate of a Lender or an
Approved Fund or an assignment of the entire remaining amount of the assigning Lenders
Commitment or Loans of any Class, (ii) an assignment to a Federal Reserve Bank or (iii) in
connection with the initial syndication of the Commitments or Loans, the amount of the
Commitment or Loans of the assigning Lender subject to each such assignment (determined as of
the date the Assignment and Acceptance with respect to such assignment is delivered to the
Administrative Agent), shall not be less than, in the case of Loans and Commitments, $5,000,000
and increments of $1,000,000 in excess thereof unless each of the Borrower and the
Administrative Agent otherwise consents (which consents shall not be unreasonably withheld or
delayed); provided that no such consent of the Borrower shall be required if a Specified Default
has occurred and is continuing with respect to Parent Guarantor or the Borrower; provided,
further, that contemporaneous assignments to a single assignee made by Affiliates of Lenders and
related Approved Funds shall be aggregated for purposes of meeting the minimum assignment
amount requirements stated above;
(B) each partial assignment shall be made as an assignment of a proportionate part of
all the assigning Lenders rights and obligations under this Agreement; provided that this clause
shall not be construed to prohibit the assignment of a proportionate part of all the assigning
Lenders rights and obligations in respect of one Class of Commitments or Loans;
(C) The parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Acceptance, together with a processing and recordation fee in the
amount of $3,500; provided that the Administrative Agent may, in its sole discretion, elect to
waive such processing and recordation fee in the case of any assignment; and
(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent
an administrative questionnaire in a form approved by the Administrative Agent (the
Administrative Questionnaire).
(iii) Subject to acceptance and recording thereof pursuant to clause (b)(iv) of this
Section 13.6, from and after the effective date specified in each Assignment and Acceptance, the
assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lenders rights and
obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.10, 2.11, 3.5, 5.4 and 13.5). Any assignment or transfer
by a Lender of rights or obligations under this Agreement that does not comply with this
Section 13.6 shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with clause (c) of this Section 13.6.
(iv) The Administrative Agent, acting for this purpose as an agent of the Borrower,
shall maintain at the Administrative Agents Office a copy of each Assignment and Acceptance
delivered to it and a register for the recordation of the names and addresses of the Lenders, and
the Commitments of, and principal amount of the Loans and any payment made by any Letter of
Credit Issuer under any Letter of Credit owing to, each Lender pursuant to the terms hereof from
time to time (the Register). Further, each Register shall contain the name and address of the
Administrative Agent and the lending office through which each such Person acts under this
Agreement. The entries in the Register shall be conclusive, and the Borrower, the Administrative
Agent, the Collateral Agent, the Letter of Credit Issuers and the Lenders shall treat each Person

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whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by Parent Guarantor, the Borrower, the Collateral Agent, the Letter of
Credit Issuers and any Lender, at any reasonable time and from time to time upon reasonable
prior notice. This Section shall be construed so that the Loans and Letters of Credit are at all
times maintained in registered form within the meaning of Sections 163(f), 871(h)(2) and
881(c)(2) of the Code.
(v) Upon its receipt of a duly completed Assignment and Acceptance executed by an
assigning Lender and an assignee, the assignees completed Administrative Questionnaire (unless
the assignee shall already be a Lender hereunder), the processing and recordation fee referred to
in clause (b) of this Section 13.6 (unless waived) and any written consent to such assignment
required by clause (b) of this Section 13.6, the Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the Register.
(c) (i) Any Lender may, without the consent of Parent Guarantor, the Borrower, the
Administrative Agent or any Letter of Credit Issuer, sell participations to one or more banks or other
entities that are not Disqualified Institutions (each, a Participant) in all or a portion of such Lenders
rights and obligations under this Agreement (including all or a portion of its Commitments and the Loans
owing to it); provided that (A) such Lenders obligations under this Agreement shall remain unchanged,
(B) such Lender shall remain solely responsible to the other parties hereto for the performance of such
obligations and (C) Parent Guarantor, the Borrower, the Administrative Agent, the Letter of Credit Issuers
and the other Lenders shall continue to deal solely and directly with such Lender in connection with such
Lenders rights and obligations under this Agreement. Any agreement or instrument pursuant to which a
Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision of this Agreement or
any other Credit Document; provided that such agreement or instrument may provide that such Lender
will not, without the consent of the Participant, agree to any consent, amendment, modification,
supplement or waiver described in clause (i) or (vii) of the second proviso of the first paragraph of
Section 13.1 that affects such Participant. Subject to clause (c)(ii) of this Section 13.6, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.10, 2.11 and 5.4 to the same
extent as if it were a Lender, and provided that such Participant agrees to be subject to the requirements of
those Sections as though it were a Lender and had acquired its interest by assignment pursuant to clause
(b) of this Section 13.6 To the extent permitted by Applicable Law, each Participant also shall be entitled
to the benefits of Section 13.8(b) as though it were a Lender; provided such Participant agrees to be
subject to Section 13.8(a) as though it were a Lender.
(ii) A Participant shall not be entitled to receive any greater payment under Section
2.10, 2.11, or 5.4 than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the participation to such Participant is
made with the Borrowers prior written consent (which consent shall not be unreasonably
withheld or delayed).
(iii) Each Lender that sells a participation shall, acting for this purpose as a non-
fiduciary agent of the Borrower, maintain a register on which it enters the name and address of
each participant and the principal amounts of each participants interest in the Loans (or other
rights or obligations) held by it (the Participant Register). The entries in the Participant
Register shall be conclusive, and such lender shall treat each Person whose name is recorded in
the Participant Register as the owner of such Loan or other obligation hereunder as the owner
thereof for all purposes of this Agreement notwithstanding any notice to the contrary. No Lender
shall have any obligation to disclose all or any portion of the Participant Register (including the

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identity of any Participant or any information relating to a Participants interest in any
commitments, loans, letters of credit or its other obligations under any Credit Document) to any
Person except to the extent that such disclosure is necessary to establish that such commitment,
loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the
United States Treasury Regulations. This Section shall be construed so that the Loans are at all
times maintained in registered form within the meaning of Sections 163(f), 871(h)(2) and
881(c)(2) of the Code.
(d) Any Lender may, without the consent of Parent Guarantor, the Borrower, the
Administrative Agent, at any time pledge or assign a security interest in all or any portion of its rights
under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section 13.6 shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of a security interest shall
release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto. In order to facilitate such pledge or assignment or for any other reason, the
Borrower hereby agrees that, upon request of any Lender at any time and from time to time after any
Borrower has made its initial borrowing hereunder, the Borrower shall provide to such Lender, at the
Borrowers own expense, a promissory note, substantially in the form of Exhibit J -1, J -2 or J -3,
evidencing the Revolving Credit Loans, Term Loans and Delayed-Draw Term Loans, respectively, owing
to such Lender.
(e) Subject to this Section 13.16, the Borrower authorizes each Lender to disclose to
any Participant, secured creditor of such Lender or assignee (each, a Transferee), any prospective
Transferee and any prospective direct or indirect contractual counterparties to any swap or derivative
transactions to be entered into in connection with or relating to Loans made hereunder any and all
financial information in such Lenders possession concerning the Borrower and its Affiliates that has been
delivered to such Lender by or on behalf of the Borrower and its Affiliates pursuant to this Agreement or
that has been delivered to such Lender by or on behalf of the Borrower and its Affiliates in connection
with such Lenders credit evaluation of the Borrower and its Affiliates prior to becoming a party to this
Agreement.
(f) The words execution, signed, signature, and words of like import in any
Assignment and Acceptance shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually
executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and
as provided for in any applicable law, including the Federal Electronic Signatures in Global and National
Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state
laws based on the Uniform Electronic Transactions Act.
(g) SPV Lender. Notwithstanding anything to the contrary contained herein, any
Lender (a Granting Lender) may grant to a special purpose funding vehicle (a SPV), identified as
such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower,
the option to provide to the Borrower all or any part of any Loan that such Granting Lender would
otherwise be obligated to make the Borrower pursuant to this Agreement; provided that (i) nothing herein
shall constitute a commitment by any SPV to make any Loan and (ii) if an SPV elects not to exercise such
option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to
make such Loan pursuant to the terms hereof. The making of a Loan by an SPV hereunder shall utilize
the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such
Granting Lender. Each party hereto hereby agrees that no SPV shall be liable for any indemnity or
similar payment obligation under this Agreement (all liability for which shall remain with the Granting
Lender). In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive

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the termination of this Agreement) that, prior to the date that is one year and one day after the payment in
full of all outstanding commercial paper or other senior indebtedness of any SPV, it shall not institute
against, or join any other person in instituting against, such SPV any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under the laws of the United States or any State
thereof. In addition, notwithstanding anything to the contrary contained in this Section 13.6, any SPV
may (i) with notice to, but without the prior written consent of, the Borrower and the Administrative
Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans
to the Granting Lender or to any financial institutions (consented to by the Borrower and Administrative
Agent) providing liquidity and/or credit support to or for the account of such SPV to support the funding
or maintenance of Loans and (ii) disclose on a confidential basis any non-public information relating to its
Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or
liquidity enhancement to such SPV. This Section 13.6(g) may not be amended without the written
consent of the SPV. Notwithstanding anything to the contrary in this Agreement, (x) no SPV shall be
entitled to any greater rights under Sections 2.10, 2.11, and 5.4 than its Granting Lender would have been
entitled to absent the use of such SPV and (y) each SPV agrees to be subject to the requirements of
Sections 2.10, 2.11, and 5.4 as though it were a Lender and has acquired its interest by assignment
pursuant to clause (b) of this Section 13.6.
13.7. Replacements of Lenders under Certain Circumstances.
(a) The Borrower shall be permitted to replace any Lender that (a) requests
reimbursement for amounts owing pursuant to Section 2.10, 3.5 or 5.4, (b) is affected in the manner
described in Section 2.10(a)(iii) and as a result thereof any of the actions described in such Section is
required to be taken or (c) becomes a Defaulting Lender, with a replacement bank or other financial
institution; provided that (i) such replacement does not conflict with any Applicable Law, (ii) no
Specified Default shall have occurred and be continuing at the time of such replacement, (iii) the
Borrower shall repay (or the replacement bank or institution shall purchase, at par) all Loans and other
amounts (other than any disputed amounts), pursuant to Section 2.10, 2.11, 3.5 or 5.4, as the case may be)
owing to such replaced Lender prior to the date of replacement, (iv) the replacement bank or institution, if
not already a Lender, and the terms and conditions of such replacement, shall be reasonably satisfactory
to the Administrative Agent, (v) the replaced Lender shall be obligated to make such replacement in
accordance with the provisions of Section 13.6 (provided that the Borrower shall be obligated to pay the
registration and processing fee referred to therein) and (vi) any such replacement shall not be deemed to
be a waiver of any rights that the Borrower, the Administrative Agent or any other Lender shall have
against the replaced Lender.
(b) If any Lender (such Lender, a Non-Consenting Lender) has failed to consent
to a proposed amendment, modification, supplement, waiver, discharge or termination that pursuant to the
terms of Section 13.1 requires the consent of all of the Lenders or all Lenders affected and with respect to
which the Required Lenders shall have granted their consent, then provided no Event of Default then
exists, the Borrower shall have the right (unless such Non-Consenting Lender grants such consent) to
replace such Non-Consenting Lender by requiring such Non-Consenting Lender to assign its Loans and
its Commitments hereunder to one or more assignees reasonably acceptable to the Administrative Agent;
provided that: (a) all Obligations of the Borrower owing to such Non-Consenting Lender being replaced
shall be paid in full to such Non-Consenting Lender concurrently with such assignment, and (b) the
replacement Lender shall purchase the foregoing by paying to such Non-Consenting Lender a price equal
to the principal amount thereof plus accrued and unpaid interest thereon. In connection with any such
assignment, the Borrower, Administrative Agent, such Non-Consenting Lender and the replacement
Lender shall otherwise comply with Section 13.6.

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13.8. Adjustments; Set-off . Subject in each case to the Orders:
(a) If any Lender (a Benefited Lender) shall at any time receive any payment of
all or part of its Loans, or interest thereon, or receive any collateral in respect thereof (whether voluntarily
or involuntarily, by set-off, or otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other Lenders Loans, or interest thereon, such
Benefited Lender shall purchase for cash from the other Lenders a participating interest in such portion of
each such other Lenders Loan, or shall provide such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to cause such Benefited Lender to share the
excess payment or benefits of such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is thereafter recovered from such
Benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the
extent of such recovery, but without interest.
(b) After the occurrence and during the continuance of an Event of Default, in
addition to any rights and remedies of the Lenders provided by Applicable Law, each Lender shall have
the right, without prior notice to Parent Guarantor, the Borrower, any such notice being expressly waived
by Parent Guarantor, the Borrower to the extent permitted by Applicable Law, upon any amount
becoming due and payable by the Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise) to set-off and appropriate and apply against such amount any and all deposits (general or
special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency thereof to or for the credit
or the account of the Borrower. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such Lender; provided that the
failure to give such notice shall not affect the validity of such set-off and application.
13.9. Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts (including by facsimile or other electronic
transmission), and all of said counterparts taken together shall be deemed to constitute one and the same
instrument. A set of the copies of this Agreement signed by all the parties shall be lodged with the
Borrower and the Administrative Agent.
13.10. Severability. Any provision of this Agreement that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
13.11. INTEGRATION. THIS WRITTEN AGREEMENT AND THE OTHER CREDIT
DOCUMENTS REPRESENT THE FINAL AGREEMENT OF PARENT GUARANTOR, THE
BORROWER, THE COLLATERAL AGENT, THE ADMINISTRATIVE AGENT, THE LETTER OF
CREDIT ISSUERS AND THE LENDERS WITH RESPECT TO THE SUBJ ECT MATTER HEREOF,
AND (1) THERE ARE NO PROMISES, UNDERTAKINGS, REPRESENTATIONS OR
WARRANTIES BY PARENT GUARANTOR, THE BORROWER, THE ADMINISTRATIVE AGENT,
THE COLLATERAL AGENT, THE LETTER OF CREDIT ISSUERS OR ANY LENDER RELATIVE
TO SUBJ ECT MATTER HEREOF NOT EXPRESSLY SET FORTH OR REFERRED TO HEREIN OR
IN THE OTHER CREDIT DOCUMENTS, (2) THIS AGREEMENT AND THE OTHER CREDIT
DOCUMENTS MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES AND
(3) THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES; PROVIDED

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THAT THE SYNDICATION PROVISIONS AND THE BORROWERS AND PARENT
GUARANTORS CONFIDENTIALITY OBLIGATIONS IN THE COMMITMENT LETTER SHALL
REMAIN IN FULL FORCE AND EFFECT. IT IS SPECIFICALLY AGREED THAT THE PROVISION
OF THE CREDIT FACILITIES HEREUNDER BY THE LENDERS SUPERSEDES AND IS IN
SATISFACTION OF THE OBLIGATIONS OF THE AGENTS (AS DEFINED IN THE
COMMITMENT LETTER) TO PROVIDE THE COMMITMENTS SET FORTH IN THE
COMMITMENT LETTER.
13.12. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK AND
TO THE EXTENT APPLICABLE, THE BANKRUPTCY CODE.
13.13. Submission to J urisdiction; Waivers. Each party hereto irrevocably and
unconditionally:
(a) submits for itself and its property in any legal action or proceeding relating to this
Agreement and the other Credit Documents to which it is a party, or for recognition and enforcement of
any judgment in respect thereof, to the exclusive jurisdiction of the Bankruptcy Court, and to the extent
the Bankruptcy Court does not have (or abstains from exercising) jurisdiction, the courts of the State of
New York, the courts of the United States of America for the Southern District of New York and
appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such courts and
waives any objection that it may now or hereafter have to the venue of any such action or proceeding in
any such court or that such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be effected
by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail),
postage prepaid, to such Person at its address set forth on Schedule 13.2 at such other address of which
the Administrative Agent shall have been notified pursuant to Section 13.2;
(d) agrees that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other jurisdiction;
(e) subject to the last paragraph of Section 13.5, waives, to the maximum extent not
prohibited by Applicable Law, any right it may have to claim or recover in any legal action or proceeding
referred to in this Section 13.13 any special, exemplary, punitive or consequential damages; and
(f) agrees that a final judgment in any action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by
Applicable Law.
13.14. Acknowledgments. Each of Parent Guarantor and the Borrower hereby
acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Credit Documents;

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(b) (i) the credit facilities provided for hereunder and any related arranging or other
services in connection therewith (including in connection with any amendment, waiver or other
modification hereof or of any other Credit Document) are an arms-length commercial transaction
between Parent Guarantor and the Borrower, on the one hand, and the Administrative Agent, the Letter of
Credit Issuer, the Lenders and the other Agents on the other hand, and Parent Guarantor, the Borrower
and the other Credit Parties are capable of evaluating and understanding and understand and accept the
terms, risks and conditions of the transactions contemplated hereby and by the other Credit Documents
(including any amendment, waiver or other modification hereof or thereof); (ii) in connection with the
process leading to such transaction, each of the Administrative Agent and the other Agents, is and has
been acting solely as a principal and is not the financial advisor, agent or fiduciary for any of Parent
Guarantor, the Borrower, any other Credit Parties or any of their respective Affiliates, stockholders,
creditors or employees or any other Person; (iii) neither the Administrative Agent nor any other Agent has
assumed or will assume an advisory, agency or fiduciary responsibility in favor of Parent Guarantor, the
Borrower or any other Credit Party with respect to any of the transactions contemplated hereby or the
process leading thereto, including with respect to any amendment, waiver or other modification hereof or
of any other Credit Document (irrespective of whether the Administrative Agent or any other Agent has
advised or is currently advising Parent Guarantor, the Borrower, the other Credit Parties or their
respective Affiliates on other matters) and neither the Administrative Agent or other Agent has any
obligation to Parent Guarantor, the Borrower, the other Credit Parties or their respective Affiliates with
respect to the transactions contemplated hereby except those obligations expressly set forth herein and in
the other Credit Documents; (iv) the Administrative Agent, each other Agent and each Affiliate of the
foregoing may be engaged in a broad range of transactions that involve interests that differ from those of
Parent Guarantor, the Borrower and their respective Affiliates, and neither the Administrative Agent nor
any other Agent has any obligation to disclose any of such interests by virtue of any advisory, agency or
fiduciary relationship; and (v) neither the Administrative Agent nor any other Agent has provided and
none will provide any legal, accounting, regulatory or tax advice with respect to any of the transactions
contemplated hereby (including any amendment, waiver or other modification hereof or of any other
Credit Document) and Parent Guarantor and the Borrower has consulted its own legal, accounting,
regulatory and tax advisors to the extent it has deemed appropriate. Parent Guarantor and the Borrower
agree not to claim that the Administrative Agent or any other Agent has rendered advisory services of any
nature or respect, or owes a fiduciary or similar duty to Parent Guarantor, the Borrower or any other
Affiliates, in connection with the transactions contemplated hereby or the process leading hereto.
(c) no joint venture is created hereby or by the other Credit Documents or otherwise
exists by virtue of the transactions contemplated hereby among the Lenders or among Parent Guarantor
and the Borrower, on the one hand, and any Lender, on the other hand.
13.15. WAIVERS OF J URY TRIAL. PARENT GUARANTOR, THE BORROWER,
EACH AGENT AND EACH LENDER HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY J URY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.
13.16. Confidentiality. The Administrative Agent, each Letter of Credit Issuer, each
other Agent and each Lender shall hold all non-public information furnished by or on behalf of Parent
Guarantor, the Borrower or any Subsidiary of the Borrower in connection with such Lenders evaluation
of whether to become a Lender hereunder or obtained by such Lender, the Administrative Agent, Letter of
Credit Issuer or such other Agent pursuant to the requirements of this Agreement or in connection with
any amendment, supplement, modification or waiver or proposed amendment, supplement, modification
or waiver hereto or the other Credit Documents (Confidential Information), confidential in
accordance with its customary procedure for handling confidential information of this nature and (in the

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case of a Lender that is a bank) in accordance with safe and sound banking practices and in any event may
make disclosure as required or requested by any governmental, regulatory or self-regulatory agency or
representative thereof or pursuant to legal process or Applicable Law or (a) to such Lenders or the
Administrative Agents or such Letter of Credit Issuers or such other Agents attorneys, professional
advisors, independent auditors, trustees or Affiliates, (b) to an investor or prospective investor in a
Securitization that agrees its access to information regarding the Credit Parties, the Loans and the Credit
Documents is solely for purposes of evaluating an investment in a Securitization and who agrees to treat
such information as confidential, (c) to a trustee, collateral manager, servicer, backup servicer, noteholder
or secured party in connection with the administration, servicing and reporting on the assets serving as
collateral for a Securitization and who agrees to treat such information as confidential and (d) to a
nationally recognized ratings agency that requires access to information regarding the Credit Parties, the
Loans and Credit Documents in connection with ratings issued with respect to a Securitization; provided
that unless specifically prohibited by Applicable Law or court order, each Lender, the Administrative
Agent, each Letter of Credit Issuer and each other Agent shall use commercially reasonable efforts to
notify the Borrower of any request made to such Lender, the Administrative Agent, such Letter of Credit
Issuer or such other Agent, as applicable, by any governmental, regulatory or self-regulatory agency or
representative thereof (other than any such request in connection with a routine examination of such
Lender by such governmental regulatory or self-regulatory agency) for disclosure of any such non-public
information prior to disclosure of such information; and provided further that in no event shall any
Lender, the Administrative Agent, any Letter of Credit Issuer or any other Agent be obligated or required
to return any materials furnished by Parent Guarantor, the Borrower or any Subsidiary of the Borrower.
Each Lender, the Administrative Agent, each other Letter of Credit Issuer and each other Agent agrees
that it will not provide to prospective Transferees or to any pledgee referred to in Section 13.6 or to
prospective direct or indirect contractual counterparties to any swap or derivative transactions to be
entered into in connection with or relating to Loans made hereunder any of the Confidential Information
unless such Person is advised of and agrees to be bound by the provisions of this Section 13.16 or
confidentiality provisions at least as restrictive as those set forth in this Section 13.16.
13.17. Direct Website Communications.
(a) Parent Guarantor and the Borrower may, at their option, provide to the
Administrative Agent any information, documents and other materials that they are obligated to furnish to
the Administrative Agent pursuant to the Credit Documents, including, all notices, requests, financial
statements, financial and other reports, certificates and other information materials, but excluding any
such communication that (A) relates to a request for a new, or a conversion of an existing, Borrowing or
other extension of credit (including any election of an interest rate or Interest Period relating thereto), (B)
relates to the payment of any principal or other amount due under this Agreement prior to the scheduled
date therefor, (C) provides notice of any Default or Event of Default under this Agreement or (D) is
required to be delivered to satisfy any condition precedent to the effectiveness of this Agreement and/or
any Borrowing or other extension of credit thereunder (all such non-excluded communications being
referred to herein collectively as Communications), by transmitting the Communications in an
electronic/soft medium in a format reasonably acceptable to the Administrative Agent at
glagentofficeops@citi.com; provided that: (i) upon written request by the Administrative Agent, Parent
Guarantor or the Borrower shall deliver paper copies of such documents to the Administrative Agent for
further distribution to each Lender until a written request to cease delivering paper copies is given by the
Administrative Agent and (ii) Parent Guarantor or the Borrower shall notify (which may be by facsimile
or electronic mail) the Administrative Agent of the posting of any such documents and provide to the
Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents. Each
Lender shall be solely responsible for timely accessing posted documents or requesting delivery of paper
copies of such documents from the Administrative Agent and maintaining its copies of such documents.
Nothing in this Section 13.17 shall prejudice the right of Parent Guarantor, the Borrower, the

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Administrative Agent, any other Agent or any Lender to give any notice or other communication pursuant
to any Credit Document in any other manner specified in such Credit Document.
(b) The Administrative Agent agrees that the receipt of the Communications by the
Administrative Agent at its e-mail address set forth above shall constitute effective delivery of the
Communications to the Administrative Agent for purposes of the Credit Documents. Each Lender agrees
that notice to it (as provided in the next sentence) specifying that the Communications have been posted
to the Platform shall constitute effective delivery of the Communications to such Lender for purposes of
the Credit Documents. Each Lender agrees (A) to notify the Administrative Agent in writing (including
by electronic communication) from time to time of such Lenders e-mail address to which the foregoing
notice may be sent by electronic transmission and (B) that the foregoing notice may be sent to such e-mail
address.
(c) Parent Guarantor and the Borrower further agree that the Agents may make the
Communications available to the Lenders by posting the Communications on Intralinks or a substantially
similar electronic transmission system (the Platform), so long as the access to such Platform is limited
(i) to the Agents, the Letter of Credit Issuers, the Lenders or any bona fide potential Transferee and (ii)
remains subject the confidentiality requirements set forth in Section 13.16.
(d) THE PLATFORM IS PROVIDED AS IS AND AS AVAILABLE. THE
AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR
COMPLETENESS OF THE COMMUNICATIONS OR THE ADEQUACY OF THE PLATFORM,
AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE
COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY,
INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES
OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE
COMMUNICATIONS OR THE PLATFORM. In no event shall any Agent or their Related Parties
(collectively, the Agent Parties and each an Agent Party) have any liability to Parent Guarantor, the
Borrower, any Lender, any Letter of Credit Issuer or any other Person for losses, claims, damages,
liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of Parent Guarantor,
the Borrowers or any Agents transmission of Communications through the internet, except to the extent
the liability of any Agent Party resulted from such Agent Partys (or any of its Related Parties (other than
trustees or advisors)) gross negligence, bad faith or willful misconduct or material breach of the Credit
Documents (as determined in a final non-appealable judgment of a court of competent jurisdiction).
(e) The Borrower and each Lender acknowledge that certain of the Lenders may be
public-side Lenders (Lenders that do not wish to receive material non-public information with respect
to Parent Guarantor, the Borrower, the Subsidiaries of the Borrower or their securities) and, if documents
or notices required to be delivered pursuant to the Credit Documents or otherwise are being distributed
through the Platform, any document or notice that Parent Guarantor or the Borrower has indicated
contains only publicly available information with respect to Parent Guarantor, the Borrower and the
Subsidiaries of the Borrower and their securities may be posted on that portion of the Platform designated
for such public-side Lenders. If Parent Guarantor or the Borrower has not indicated whether a document
or notice delivered contains only publicly available information, the Administrative Agent shall post such
document or notice solely on that portion of the Platform designated for Lenders who wish to receive
material nonpublic information with respect to Parent Guarantor, the Borrower, the Subsidiaries of the
Borrower and their securities. Notwithstanding the foregoing, Parent Guarantor and the Borrower shall
use commercially reasonable efforts to indicate whether any document or notice contains only publicly
available information.

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13.18. USA PATRIOT Act. Each Lender hereby notifies the Borrower that pursuant to
the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the Patriot Act), it is required to obtain, verify and record information that identifies each
Credit Party, which information includes the name and address of each Credit Party and other information
that will allow such Lender to identify each Credit Party in accordance with the Patriot Act.
13.19. Payments Set Aside. To the extent that any payment by or on behalf of the
Borrower is made to any Agent or any Lender, or any Agent or any Lender exercises its right of setoff,
and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared
to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by
such Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding or otherwise, then (a) to the extent of such recovery, the obligation or
part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if
such payment had not been made or such setoff had not occurred, and (b) each Lender severally agrees to
pay to the Administrative Agent upon demand its applicable share of any amount so recovered from or
repaid by any Agent, plus interest thereon from the date of such demand to the date such payment is made
at a rate per annum equal to the applicable Overnight Rate from time to time in effect.
13.20. Separateness.
(a) The Secured Parties hereby acknowledge (i) the legal separateness of Parent
Guarantor, the Borrower and the Subsidiaries of the Borrower from the Oncor Subsidiaries, (ii) that the
lenders under the Oncor Credit Facility and the noteholders under the Oncor Notes and under the
transition bonds have likely advanced funds thereunder in reliance upon the separateness of the Oncor
Subsidiaries from Parent Guarantor, the Borrower and the Subsidiaries of the Borrower, (iii) that the
Oncor Subsidiaries have assets and liabilities that are separate from those of Parent Guarantor, the
Borrower and the Subsidiaries of the Borrower, (iv) that the Obligations are obligations and liabilities of
the Borrower and the other Credit Parties only, and are not the obligations or liabilities of any of the
Oncor Subsidiaries, (v) that the Secured Parties shall look solely to the Borrower and the Guarantors and
such Persons assets, and not to any assets, or to the pledge of any assets, owned by any of the Oncor
Subsidiaries, for the repayment of any amounts payable pursuant to this Agreement and for satisfaction of
any other Obligations and (vi) that none of the Oncor Subsidiaries shall be personally liable to the
Secured Parties for any amounts payable, or any other Obligation, under the Credit Documents.
(b) The Secured Parties hereby acknowledge and agree that the Secured Parties shall
not (i) initiate any legal proceeding to procure the appointment of an administrative receiver, or (ii)
institute any bankruptcy, reorganization, insolvency, winding up, liquidation, or any like proceeding
under applicable law, against any of the Oncor Subsidiaries, or against any of the Oncor Subsidiaries
assets. The Secured Parties further acknowledge and agree that each of the Oncor Subsidiaries is a third
party beneficiary of the foregoing covenant and shall have the right to specifically enforce such covenant
in any proceeding at law or in equity.
13.21. Keepwell. Each Qualified ECP Guarantor hereby jointly and severally absolutely,
unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from
time to time by each other Guarantor to honor all of its obligations under this Guarantee in respect of
Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable for the
maximum amount of such liability that can be hereby incurred without rendering its obligations under this
Section 13.21, or otherwise under this Agreement, voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer, and not for any greater amount). Each Qualified ECP Guarantor
intends that this Section 13.21 constitute, and this Section 13.21 shall be deemed to constitute, a

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keepwell, support, or other agreement for the benefit of each other Guarantor for all purposes of Section
1a(18)(A)(v)(II) of the Commodity Exchange Act.
SECTION 14. Security; Secured Commodity Hedging Agreements.
14.1. Security.
(a) Collateral; Grant of Lien and Security Interest.

(i) Pursuant to the Interim Order and (when applicable) the Final Order and in
accordance with the terms thereof (and subject to the terms and conditions set forth therein), as
security for the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration, or otherwise) of the Obligations, the Borrower hereby assigns, pledges,
and grants to the Collateral Agent, for the benefit of the Secured Parties (subject, in each case, to
the Carve Out and the RCT Reclamation Support Carve Out):

(A) a fully-perfected first priority senior security interest in and Lien upon,
pursuant to section 364(c)(2) of the Bankruptcy Code, all prepetition and postpetition
property of the Borrower, whether existing on the Petition Date or thereafter acquired
that, on or as of the Petition Date, is not subject to valid, perfected, and non-avoidable
Liens, including, without limitation, all real and personal property, inventory, plant,
fixtures, machinery, equipment, the RCT L/C Collateral Accounts, the General L/C
Collateral Accounts, cash, any investment of such cash, accounts receivable, other rights
to payment whether arising before or after the Petition Date (including, without
limitation, post-petition intercompany claims of the Borrower), deposit accounts,
investment property, supporting obligations, minerals, oil, gas, and as-extracted
collateral, causes of action (including those arising under section 549 of the Bankruptcy
Code and any related action under section 550 of the Bankruptcy Code), royalty interests,
chattel paper, contracts, general intangibles, documents, instruments, interests in
leaseholds, letter of credit rights, patents, copyrights, trademarks, trade names, other
intellectual property, Stock and Stock Equivalents of Subsidiaries, books and records
pertaining to the foregoing, and to the extent not otherwise included, all proceeds,
products, offspring, and profits of any and all of the foregoing (the Unencumbered
Property); provided that the Unencumbered Property shall exclude the Borrowers
Avoidance Actions, but subject only to, and effective upon, entry of the Final Order, shall
include any proceeds or property recovered, unencumbered, or otherwise the subject of
successful Avoidance Actions, whether by judgment, settlement, or otherwise;

(B) a fully-perfected first priority senior priming security interest in and Lien
upon, pursuant to section 364(d)(1) of the Bankruptcy Code, all prepetition and
postpetition property of the Borrower, whether existing on the Petition Date or thereafter
acquired, that is subject to valid, perfected, and non-avoidable Liens currently held by
any of the Prepetition Secured Creditors (as defined in the Interim Cash Collateral Order
and (when applicable) the Final Cash Collateral Order), excluding the Deposit L/C Loan
Collateral Account to the extent of the Deposit L/C Obligations (each as defined in the
Prepetition Credit Agreement); provided that such security interests and Liens shall be
senior in all respects to the interests in such property of any of the Prepetition Secured
Creditors arising from current and future Liens of any of the Prepetition Secured
Creditors (including, without limitation, Adequate Protection Liens) (as defined in the
Interim Cash Collateral Order and (when applicable) the Final Cash Collateral Order),
but shall not be senior to any valid, perfected, and non-avoidable interests of other parties

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arising out of Liens, if any, on such property existing immediately prior to the Petition
Date, including the Liens securing the Tex-La Indebtedness, or to any valid, perfected,
and non-avoidable interests in such property arising out of Liens to which the Liens of
any of the Prepetition Secured Creditors become subject subsequent to the Petition Date
as permitted by section 546(b) of the Bankruptcy Code; and

(C) a fully-perfected junior security interest in and Lien upon, pursuant to section
364(c)(3) of the Bankruptcy Code, all prepetition and postpetition property of the
Borrower (other than the property described in clauses (A) and (B) of this Section
14.1(a)(i), as to which the Liens and security interests in favor of the Collateral Agent, for
the benefit of the Secured Parties, will be as described in such clauses), whether existing
on the Petition Date or thereafter acquired, that is subject to valid, perfected, and non-
avoidable Liens in existence immediately prior to the Petition Date, or to any valid and
non-avoidable Liens in existence immediately prior to the Petition Date that are perfected
subsequent to the Petition Date as permitted by section 546(b) of the Bankruptcy Code
(in each case, other than the Adequate Protection Liens (as defined in the Interim Cash
Collateral Order and (when applicable) the Final Cash Collateral Order));

provided, that notwithstanding anything to the contrary in this Section 14.1(a)(i), the Collateral shall
exclude Excluded Collateral.

(ii) The security interests and Liens in favor of the Collateral Agent in the Collateral
shall be effective immediately upon the entry of the Interim Order and subject, only in the event
of the occurrence and during the continuance of an Event of Default, to the Carve Out, the RCT
Reclamation Support Carve Out and the terms and conditions set forth in the Interim Order and
(when applicable) the Final Order. Such Liens and security interests and their priority shall
remain in effect until the Obligations (except for Hedging Obligations in respect of any Secured
Hedging Agreement and/or any Secured Commodity Hedging Agreement, Cash Management
Obligations in respect of Secured Cash Management Agreements and Contingent Obligations)
have been indefeasibly paid in full, in cash, all Commitments have been terminated, and all
Letters of Credit have been cancelled (or all such Letters of Credit have been fully cash
collateralized or otherwise back-stopped, in each case to the satisfaction of the applicable Letter
of Credit Issuers).

(iii) Subject only to the prior payment of the Carve Out and the RCT Reclamation
Support Carve Out, no costs or expenses of administration which have been or may be incurred in
the Cases or any Successor Cases (as defined in the Orders) or in any other proceedings related
thereto, and no priority claims, are or will be senior to, or pari passu with, any claim of any
Secured Party or the Collateral Agent against any Credit Party.

(b) Administrative Priority. The Borrower agrees that its Obligations shall, pursuant
to section 364(c)(1) of the Bankruptcy Code, constitute allowed superpriority administrative expense
claims in the Cases or any Successor Cases, ranking on a parity with each other and having priority over
all administrative expense claims, diminution claims, unsecured claims, and all other claims against the
TCEH Debtors or their estates in any of the Cases and any Successor Cases, existing on the Petition Date
or thereafter, of any kind or nature whatsoever, including, without limitation, all administrative expenses
of the kinds specified in, or ordered pursuant to, sections 105, 326, 328, 330, 331, 365, 503(a), 503(b),
506(c) (subject only to, and upon entry of, the Final Order), 507(a), 507(b), 546(c), 546(d), 726, 1113,
and 1114 of the Bankruptcy Code, and any other provision of the Bankruptcy Code, subject only to the
Carve Out and the RCT Reclamation Support Carve Out, to the extent specifically provided for in the
Interim Order and (when applicable) the Final Order.

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(c) Grants, Rights and Remedies. The Liens and security interests granted pursuant
to Section 14.1(a)(i) hereof and the administrative priority granted pursuant to Section 14.1(b) hereof may
be independently granted by the Credit Documents and by other Credit Documents hereafter entered into.
This Agreement, the Interim Order and (when applicable) the Final Order, and such other Credit
Documents supplement each other, and the grants, priorities, rights, and remedies of the Agents and the
Secured Parties hereunder and thereunder are cumulative.

(d) No Filings Required. The Liens and security interests referred to in this Section
14 shall be deemed valid and perfected by entry of the Interim Order and (when applicable) the Final
Order, and entry of the Interim Order shall have occurred on or before any Loan is made during the
Interim Period and entry of the Final Order shall have occurred on or before any Loan is made after the
Interim Period. The Collateral Agent shall not be required to file or record any financing statements,
patent filings, trademark filings, mortgages, notices of Lien, or other instrument or document in any
jurisdiction or filing office, take possession or control of any Collateral, or take any other action in order
to validate or perfect the Liens and security interests granted by or pursuant to this Agreement, the Interim
Order or (when applicable) the Final Order or any other Credit Document.

(e) Survival. The Liens, lien priority, administrative priorities and other rights and
remedies granted to the Collateral Agent and the Secured Parties pursuant to this Agreement, the Interim
Order and (when applicable) the Final Order, and the other Credit Documents (specifically including, but
not limited to, the existence, perfection and priority of the Liens and security interests provided herein and
therein, and the administrative priority provided herein and therein) shall not be modified, altered, or
impaired in any manner by any other financing or extension of credit or incurrence of Indebtedness by the
TCEH Debtors (pursuant to section 364 of the Bankruptcy Code or otherwise), or by any dismissal or
conversion of any of the Cases, or by any other act or omission whatsoever. Without limitation,
notwithstanding any such order, financing, extension, incurrence, dismissal, conversion, act or omission:

(i) except to the extent of the Carve Out or the RCT Reclamation Support Carve
Out, no fees, charges, disbursements, costs or expenses of administration which have been or may
be incurred in the Cases or any Successor Cases, or in any other proceedings related thereto, and
no priority claims, are or will be superior to or pari passu with any claim of the Collateral Agent
and the Secured Parties against the TCEH Debtors;

(ii) subject to the Carve Out and the RCT Reclamation Support Carve Out and
subject to the terms of the Interim Order and (when applicable) the Final Order, the Liens in favor
of the Collateral Agent and the Secured Parties set forth in Section 14.1(a)(i) hereof shall
constitute valid and perfected first priority Liens and security interests, and shall be superior to all
other Liens and security interests, existing as of the Petition Date or thereafter arising, in favor of
any other creditor or any other Person whatsoever (subject to Permitted Liens); and

(iii) the Liens in favor of the Collateral Agent and the Secured Parties set forth herein
and in the other Credit Documents shall continue to be valid and perfected without the necessity
that the Collateral Agent files financing statements or mortgages, takes possession or control of
any Collateral, or otherwise perfects its Lien under applicable non-bankruptcy law.

14.2. Secured Commodity Hedging Agreements.
(a) Subject to the limitations set forth in this Agreement, the Borrower and each
Secured Party acknowledges and agrees that the Collateral may secure additional obligations of the
Borrower and the other Credit Parties in respect of Secured Commodity Hedging Agreements, subject to

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compliance with this Section 14.2. Upon (x) execution and delivery to the Collateral Agent of an
Accession Agreement and (y) compliance with the procedures set forth in Section 8.16 of the Security
Agreement, such Person shall become a Hedge Bank under clause (i) of the definition thereof and a
Secured Party hereunder and under the other Credit Documents, and the Credit Parties obligations to
such Person shall become Obligations hereunder and under the Credit Documents and Secured
Obligations under the Security Agreement; provided that, for the avoidance of doubt, no such Person in
such capacity shall have any consent or voting rights under this Agreement or any of the Credit
Documents. Each Credit Party and each Secured Party agrees that this Agreement and the applicable
Security Documents may be amended by the Credit Parties and the Collateral Agent without the consent
of any Secured Party to the extent necessary or desirable to cause the Liens granted thereby to be in favor
of such Persons (to the extent Liens in favor of such Persons are permitted by the terms of this
Agreement).
(b) Notwithstanding the foregoing, nothing in this Agreement will be construed to
allow any Credit Party to incur additional Indebtedness or grant additional Liens unless in each case
permitted by the terms of this Agreement.
14.3. Permitted Property Interests. Upon the written request of any Credit Party
following such Credit Partys execution of an easement, right-of-way or other real or personal property
interest that (i) constitutes in whole or in part a Permitted Lien pursuant to clause (f) of the definition of
Permitted Liens in the Agreement (a Permitted Lien pursuant to such clause (f), a Permitted Property
Interest), and (ii) in the commercially reasonable determination of such Credit Party is required in the
ordinary course of business, the Collateral Agent will promptly subordinate any Liens and any
Superpriority Claim held by it for the benefit of any Secured Party, to the rights of third parties with
respect to such Permitted Property Interest.

[Signature Page to Credit Agreement]
#4821-7663-6950
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement
to be duly executed and delivered as of the date first written above.

ENERGY FUTURE COMPETITIVE HOLDINGS
COMPANY LLC,
as Parent Guarantor

By: ______________________________
Name:
Title:

TEXAS COMPETITIVE ELECTRIC HOLDINGS
COMPANY LLC,
as the Borrower

By: ______________________________
Name:
Title:


[Signature Page to Credit Agreement]
#4821-7663-6950
[Lender Signature Pages]


)
In re: ) Chapter 11
)
1
)
)
Case No. 14-_______ (___)
)
MOTION OF ENERGY FUTURE INTERMEDIATE HOLDING COMPANY LLC AND
EFIH FINANCE, INC. FOR ENTRY OF (I) AN INTERIM ORDER (A) APPROVING
CERTAIN FEES RELATED TO POSTPETITION FINANCING AND GRANTING
SUCH FEES ADMINISTRATIVE EXPENSE PRIORITY AND (B) SCHEDULING A
FINAL HEARING; AND (II) A FINAL ORDER (A) APPROVING POSTPETITION
FINANCING, (B) GRANTING LIENS AND PROVIDING SUPERPRIORITY
ADMINISTRATIVE EXPENSE CLAIMS, (C) AUTHORIZING THE USE OF CASH
COLLATERAL, (D) AUTHORIZING THE EFIH FIRST LIEN REFINANCING,
(E) AUTHORIZING ISSUANCE OF ROLL-UP DEBT TO THE EXTENT
AUTHORIZED BY THE SETTLEMENT MOTION, (F) DETERMINING THE VALUE
OF SECURED CLAIMS, AND (G) MODIFYING THE AUTOMATIC STAY
Energy Future Intermediate Holding Company LLC (EFIH) and EFIH Finance Inc.
(together with EFIH, the Borrower or the EFIH Debtors, and together with the other
above-captioned debtors and debtors in possession, the Debtors), as debtors and debtors in
possession,
2
file this motion (this Motion)
3
for entry of (i) an interim order (the Interim Fee

1
2
For the avoidance of doubt, only the EFIH Debtors are seeking authority herein.
3
Capitalized terms used but not defined herein shall have the meaning ascribed to them in the EFIH First Lien
DIP Credit Agreement or the Interim Order, as applicable. As of the date hereof, the EFIH Debtors, the EFIH
First Lien DIP Lenders, and the EFIH First Lien DIP Agent are in the process of finalizing the EFIH First Lien
DIP Credit Agreement. As a result, the agreement has not been filed herewith, but will be filed on or shortly
following the Petition Date.
2

Order), substantially in the form attached hereto as Exhibit A, (a) approving certain fees as and
to the extent required under that certain commitment letter (the EFIH First Lien DIP
Commitment Letter)
4
relating to commitments to fund the EFIH First Lien DIP Financing (as
defined herein) and that certain fee letter relating to the payment of fees in connection with the
EFIH First Lien DIP Financing (the EFIH First Lien DIP Fee Letter)
5
and (b) scheduling a
hearing to consider approval of the relief requested in this Motion on a final basis (the Final
Hearing) and (ii) a final order (the Final Order, and together with the Interim Fee Order, the
Orders) (a) authorizing the EFIH Debtors to enter into the EFIH First Lien DIP Credit
Agreement (as defined herein) to obtain the EFIH First Lien DIP Financing, (b) granting liens
and providing superpriority administrative expense claims, (c) authorizing the use of EFIH Cash
Collateral (as defined herein), (d) authorizing the EFIH First Lien Refinancing (as defined
herein), (e) authorizing the issuance of EFIH First Lien DIP Roll-Up Claims (as defined herein)
to the extent provided in the Settlement Motion (as defined herein), (f) determining the value of
the secured claims of the Prepetition EFIH First Lien Creditors (as defined herein), including a
determination that such amount does not include any EFIH First Lien Makewhole Premium (as
defined herein), and (g) modifying the automatic stay.
In support thereof, the EFIH Debtors submit the Declaration of Stephen Goldstein in
Support of the Motion of Energy Future Intermediate Holding Company LLC and EFIH Finance,
Inc., for Entry of for Entry of (I) an Interim Order (A) Approving Certain Fees Related to

4
The EFIH First Lien Commitment Letter is attached hereto as Exhibit D and delineates the fees that must be
paid pursuant to the Interim Fee Order to maintain the commitment for the EFIH First Lien DIP Financing. The
EFIH First Lien Commitment Letter does not, however, disclose the amount of the applicable fees.
5
As is usual and customary with respect to debtor in possession financing facilities, the EFIH Debtors have filed
the EFIH First Lien Fee Letter under seal pursuant to the Motion Authorizing Energy Future Intermediate
Holding Company LLC and EFIH Finance, Inc. to File Under Seal Certain Fee Letters Related to Proposed
Debtor-in-Possession Financing, filed contemporaneously herewith.
3

Postpetition Financing and Granting Such Fees Administrative Expense Priority and
(B) Scheduling a Final Hearing; and (II) a Final Order (A) Approving Postpetition Financing,
(B) Granting Liens and Providing Superpriority Administrative Expense Claims, (C) Authorizing
the Use of Cash Collateral, (D) Authorizing the EFIH First Lien DIP Refinancing,
(E) Authorizing Issuance of Roll-Up Debt to the Extent Authorized by the Settlement Motion,
(F) Determining the Value of Secured Claims, and (G) Modifying the Automatic Stay (the
Goldstein Declaration),
6
a copy of which is attached hereto as Exhibit B. The EFIH Debtors
will also file the Memorandum of Law in Support of the Motion of Energy Future Intermediate
Holding Company LLC and EFIH Finance Inc. for a Final Order Determining That No
Makewhole Premium is Due Under the EFIH First Lien Notes (the First Lien Makewhole
Memorandum) and a motion (the Settlement Motion) seeking the authorization, among other
things, of the EFIH Makewhole Settlements, as soon as reasonably practicable following the
Petition Date.
Jurisdiction and Venue
1. The United States Bankruptcy Court for the District of Delaware (the Court)
has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended
Standing Order of Reference from the United States District Court for the District of Delaware,
dated February 29, 2012. This matter is a core proceeding within the meaning of
28 U.S.C. 157(b)(2), and the EFIH Debtors consent pursuant to rule 9013-1(f) of the Local
Rules of Bankruptcy Practice and Procedure of the United States Bankruptcy Court for the
District of Delaware (the Local Bankruptcy Rules) to the entry of a final order by the Court in

6
The Goldstein Declaration focuses on the relief sought under this Motion and pursuant to the Interim Fee Order.
The EFIH Debtors plan to submit supplemental declaration in support of the Final Relief sought herein at an
appropriate time before the Final Hearing date.
4

connection with this Motion to the extent that it is later determined that the Court, absent consent
of the parties, cannot enter final orders or judgments in connection herewith consistent with
Article III of the United States Constitution.
2. Venue is proper pursuant to 28 U.S.C. 1408 and 1409.
3. The bases for the relief requested in this Motion are sections 105, 361, 362, 363,
364, 502, 506, and 507 of title 11 of the United States Code (the Bankruptcy Code), rules
2002, 3012, 4001, 6003, 6004, and 9014 of the Federal Rules of Bankruptcy Procedure
(the Bankruptcy Rules), and Local Bankruptcy Rules 2002, 4001, and 9014.
Preliminary Statement
4. The Debtors commenced these chapter 11 cases to restructure more than
$42 billion in funded indebtedness, approximately $7.7 billion of which was issued by the EFIH
Debtors. The relief that the EFIH Debtors seek in this Motion is necessary to allow the EFIH
Debtors to maximize the value of their estates. Specifically, the EFIH Debtors, on an interim
basis, seek authority to honor certain obligations under the EFIH First Lien DIP Commitment
Letter and EFIH First Lien DIP Fee Letter. The EFIH Debtors, pursuant to a final order, seek to
take advantage of highly favorable debt market conditions to refinance the EFIH First Lien Notes
(the EFIH First Lien Refinancing), saving an estimated $13 million in interest per month. At
the same time, the EFIH Debtors will obtain access to continued use of cash collateral and
additional liquidity to fund their ordinary course restructuring-related expenses.
5. The EFIH Debtors have obtained commitments from several large financial
institutions for up to $5.40 billion of fully underwritten debtor-in-possession financing on a
super-priority administrative claim and first priority priming lien basis (the EFIH First Lien DIP
Financing). The EFIH First Lien DIP Financing consists of a single term credit facility, a
5

substantial portion of which will be used to execute the EFIH First Lien Refinancing. The EFIH
First Lien DIP Financing will be subject to reduction for amounts attributable to participation in
the EFIH First Lien DIP Financing by Settling Prepetition EFIH First Lien Creditors (as defined
herein) and by Fidelity in its capacity as both a Settling Prepetition EFIH First Lien Creditor and
a Prepetition EFIH Second Lien Creditor (as defined herein).
6. Certain Prepetition EFIH First Lien Creditors may assert that they should be
entitled to the payment of a prepayment penalty, otherwise known as a make-whole claim,
under the EFIH First Lien Indentures (the EFIH First Lien Makewhole Claims) in connection
with the EFIH First Lien Refinancing. The EFIH Debtors are pursuing a two-pronged strategy to
address the EFIH First Lien Makewhole Claims: (1) a settlement executed pursuant to a tender
offer (the EFIH First Lien Settlement) and (2) litigation of the non-settling EFIH First Lien
Makewhole Claims.
7. The EFIH First Lien Settlement provides that settling Prepetition EFIH First Lien
Creditors (the Settling Prepetition EFIH First Lien Creditors) will receive approximately
$105 of claims (inclusive of applicable fees) under the EFIH First Lien DIP Financing (the
EFIH First Lien DIP Roll-Up Claims) in exchange for every $100 in principal amount of EFIH
First Lien Notes tendered into the settlement by the early tender date.
7

8. It is possible that certain Prepetition EFIH First Lien Creditors will not participate
in the EFIH First Lien Settlement. With respect to such holdouts, the EFIH Debtors seek a

7
The Debtors will separately seek approval of the EFIH Makewhole Settlements (as defined herein) pursuant to a
separate motion that will be filed on or shortly after the Petition Date (the Settlement Motion). Additionally,
while certain Prepetition EFIH Secured Creditors have agreed to participate in the EFIH Makewhole
Settlements, the EFIH Debtors have determined in their business judgment that allowing all Prepetition EFIH
Secured Creditors to participate in the EFIH Makewhole Settlements will maximize the value of the EFIH
Debtors estates. The EFIH Debtors will solicit participation in the EFIH Makewhole Settlements in
accordance with applicable non-bankruptcy securities laws such that solicitation is complete on or around the
entry of the Final Order. Importantly, the EFIH Debtors will seek to consummate the full EFIH First Lien DIP
Financing regardless of whether the EFIH Makewhole Settlements are approved.
6

determination of the amount of the secured claim properly asserted against the EFIH Debtors by
the non-settling Prepetition EFIH First Lien Creditors pursuant to Bankruptcy Rule 3012 and
sections 502 and 506 of the Bankruptcy Code. As discussed in greater detail below and in the
First Lien Makewhole Memorandum that will be filed with the Court shortly following the
Petition Date, the Prepetition EFIH First Lien Creditors claims should be limited to the principal
amount of $3.985 billion, along with any accrued and unpaid interest and other fees properly due
under the EFIH First Lien Indentures, without the payment of any EFIH First Lien Makewhole
Claims.
9. The EFIH Debtors also intend to refinance the EFIH Second Lien Notes (as
defined herein) using the proceeds of a second lien debtor in possession financing facility (such
facility, the EFIH Second Lien DIP Financing, and such refinancing, the EFIH Second Lien
Refinancing).
8
The EFIH Debtors are also seeking to settle makewhole claims asserted by
Prepetition EFIH Second Lien Creditors (such claims, the EFIH Second Lien Makewhole
Claims, such settlement, the EFIH Second Lien Settlement, and the EFIH Second Lien
Settlement, together with the EFIH First Lien Settlement, the EFIH Makewhole Settlements).
Under the terms of the EFIH Second Lien Settlement, Settling Prepetiton EFIH Second Lien
Creditors other than Fidelity will receive (a) payment in cash of the principal (and accrued
interest) of their EFIH Second Lien Notes and (b) cash in the amount of 50% of their pro rata
share of their EFIH Second Lien Makewhole Claim.
9
Fidelity will also receive principal (and

8
The EFIH Debtors will seek the approval of the EFIH Second Lien DIP Financing and the EFIH Second Lien
Refinancing pursuant to a separate motion that will be filed on or shortly after the Petition Date (the EFIH
Second Lien DIP Motion). The EFIH Debtors intend to request that the Court approve the EFIH First Lien
Refinancing and the EFIH Second Lien Refinancing contemporaneously.
9
As discussed in more detail in the Settlement Motion, certain anchor settling creditors are receiving different
treatment under the EFIH Makewhole Settlements than the terms being offered in the tender offers that will
facilitate the EFIH Makewhole Settlements. Specifically, Fidelity has the option receive up to $500 million
7

accrued interest) on account of its EFIH Second Lien Notes and a 50% recovery on its EFIH
Second Lien Makewhole Claim, but Fidelity will also receive a one-time payment of $11.25
million, and will have the right to receive up to $500 million (plus fees) of its payment under the
EFIH Second Lien Settlement in the form of EFIH First Lien DIP Roll-Up Notes. Finally,
certain Prepetition EFIH Second Lien Creditors have agreed to accept claims under the EFIH
Second Lien DIP Financing, rather than cash, for their EFIH Second Lien Makewhole Claims.
10. Importantly, the EFIH Debtors seek access to EFIH Cash Collateral and the
imposition of priming liens only pursuant to the Final Order. The EFIH Debtors, therefore, need
not provide adequate protection to the Prepetition EFIH Secured Creditors during the period
between the Petition Date and the entry of the Final Order (the Interim Period). Moreover, the
EFIH Debtors will seek to execute the EFIH Second Lien Refinancing on the same schedule as
the EFIH First Lien Refinancing. Accordingly, the EFIH Debtors do not believe that they should
be or are required to provide any adequate protection to the Prepetition EFIH Second Lien
Creditors.
10

11. The Interim Fee Order seeks to approve certain fees as and to the extent required
under the EFIH First Lien DIP Commitment Letter and the EFIH First Lien DIP Fee Letter to
compensate the EFIH First Lien DIP Lenders for committing to fund the EFIH First Lien DIP
Financing pending entry of the Final Order. Importantly, under the terms of the EFIH First Lien
DIP Fee Letter and the EFIH First Lien DIP Commitment Letter, these fees need not be paid
until the EFIH First Lien DIP Financing is funded (including through the EFIH First Lien

(plus fees) of its payment under the EFIH Second Lien Refinancing and EFIH Second Lien Settlement in the
form of EFIH First Lien DIP Roll-Up Notes.
10
The EFIH Debtors will revisit appropriate adequate protection (if any) for the Prepetition EFIH Secured
Creditors to the extent necessary if, for example, the EFIH Second Lien Refinancing has not occurred when the
Final Order is entered.
8

Refinancing), or, with respect to the Ticking Fee and the fees and expenses of counsel to the
EFIH First Lien DIP Arrangers, on the earlier of the date the Final Order is entered or the date
the EFIH Debtors obtain the right to use cash collateral (although such fees will be deemed to be
administrative expense claims on the date the Interim Fee Order is entered). The fees are
reasonable under the circumstances, and were subject to hard-fought, arms-length negotiations
between the EFIH Debtors and the EFIH First Lien DIP Lenders. The only alternative to the
Interim Fee Order is a process under which the EFIH Debtors first obtain authority to execute the
EFIH First Lien Refinancing and then seek financing to consummate that transaction. That
process, however, would cost the EFIH Debtors approximately $13 million per month in interest
expense, require the EFIH Debtors to spend additional resources on a remarketing process, risk
causing the EFIH Debtors to fail to satisfy milestones under the Debtors Restructuring Support
Agreement (the Restructuring Support Agreement),
11
and there is no guarantee that the EFIH
Debtors could obtain financing on the same terms.
12. In summary, the EFIH Debtors seek to execute the EFIH First Lien DIP Financing
to maximize the value of their estates by funding restructuring expenses, taking advantage of
favorable market conditions to refinance their prepetition secured indebtedness, and facilitating a
global settlement that will allow the EFIH Debtors to expeditiously emerge from chapter 11.
Accordingly, the EFIH First Lien DIP Financing is in the best interests of the EFIH Debtors
estates and should be approved.

11
The EFIH Debtors will separately seek the authority to assume the Restructuring Support Agreement pursuant
to a motion (the RSA Motion) that will be filed on or shortly following the Petition Date.
9

Relief Requested
13. By this Motion, the EFIH Debtors seek entry of the Interim Fee Order and Final
Order. The Interim Fee Order:
(a) Authorization of Fees: approves the DIP Facility Fee and the Ticking
Fee (each as defined in the EFIH First Lien DIP Fee Letter), as well as
the reimbursement of certain costs and expenses, authorizes the EFIH
Debtors to satisfy such fees and expenses as and to the extent required
under the Commitment Letter, and grants such fees and expenses
administrative expense priority pursuant to section 503(b) of the
Bankruptcy Code; and
(b) Final Hearing: schedules a Final Hearing as soon as practicable to
consider authorizing and approving the relief requested in the Final
Order.
14. The Final Order:
(a) EFIH First Lien DIP Financing: authorizes the EFIH Debtors to
obtain secured superpriority postpetition financing (the EFIH First
Lien DIP Financing) in a principal amount of $5.40 billion, pursuant
to the terms and conditions of the proposed debtor in possession
financing agreement (the EFIH First Lien DIP Credit Agreement),
between the Borrower, the financial institutions from time to time
party thereto as lenders (the EFIH First Lien DIP Lenders),
Deutsche Bank AG New York Branch, as administrative agent and
collateral agent (in such capacity, the EFIH First Lien DIP Agent),
12

and other agents and entities from time to time party thereto;
(b) EFIH First Lien DIP Documents: authorizes the EFIH Debtors to
execute and deliver the EFIH First Lien DIP Credit Agreement and all
agreements, documents, and instruments contemplated by each
(collectively, the EFIH First Lien DIP Documents), and to take all
actions necessary, appropriate, or required to comply with the EFIH
Debtors obligations under the EFIH First Lien DIP Documents and
under the Orders;

12
As used herein, the term EFIH First Lien DIP Agent refers to Deutsche Bank AG New York Branch, as
administrative agent under the DIP Credit Agreement, Deutsche Bank AG New York Branch, as collateral
agent under the DIP Credit Agreement, or both, as the context requires. All references in this Motion to the
EFIH First Lien DIP Agent with respect to the Secured Hedge Banks or the Secured Cash Management Banks
(each, as defined in the Interim Order) shall mean Deutsche Bank AG New York Branch, in its capacity as
collateral agent. Deutsche Bank AG New York Branch, in its capacity as administrative agent, has no duties or
obligations to the Secured Hedge Banks or the Secured Cash Management Banks.
10

(c) Payment of Fees Under Interim Fee Order: authorizes and directs the
EFIH Debtors to pay fees properly accrued and payable under the
Interim Fee Order;
(d) EFIH First Lien DIP Liens: authorizes the EFIH Debtors to grant the
EFIH First Lien DIP Agent, for the benefit of itself, the EFIH First
Lien DIP Lenders, the Secured Hedge Banks, and the Secured Cash
Management Banks, automatically perfected postpetition security
interests and liens (the EFIH First Lien DIP Liens) in the DIP
Collateral (as defined in the Interim Order), subject only to the
Permitted Prior Liens and the Carve Out;
(e) DIP Superpriority Claims: authorizes the EFIH Debtors to grant the
EFIH First Lien DIP Agent, for the benefit of itself, the EFIH First
Lien DIP Lenders, the Secured Hedge Banks, and the Secured Cash
Management Banks, allowed superpriority administrative expense
claims (the EFIH DIP Superpriority Claims), subject only to the
payment of the Carve Out;
(f) EFIH Cash Collateral: authorizes the EFIH Debtors to use the EFIH
Debtors cash on hand, cash proceeds of the Prepetition EFIH
Collateral, and other cash that constituted the Prepetition EFIH
Secured Creditors (as defined herein) cash collateral, as that term is
defined in section 365(a) of the Bankruptcy Code (the EFIH Cash
Collateral);
(g) EFIH First Lien Refinancing: authorizes the EFIH Debtors to use the
proceeds of the EFIH First Lien DIP Financing to consummate the
EFIH First Lien Refinancing;
(h) Issuance of EFIH First Lien DIP Roll-Up Claims: authorizes the
EFIH Debtors to issue the EFIH First Lien DIP Roll-Up Claims to
satisfy EFIHs obligations under the EFIH Makewhole Settlements to
the extent authorized pursuant to an order approving the EFIH
Makewhole Settlements under the Settlement Motion;
(i) Determination of Value of Secured Claims: pursuant to Bankruptcy
Rule 3012, determines that the value of the secured claims allowable
on account of the EFIH First Lien Notes held by non-settling
Prepetition EFIH First Lien Creditors does not include any amount
attributable to the EFIH First Lien Makewhole Claims;
(j) Automatic Stay: vacates and modifies the automatic stay imposed by
section 362 of the Bankruptcy Code to the extent necessary to
implement and effectuate the terms and provisions of EFIH First Lien
DIP Credit Agreement and the Orders.
11

Concise Statement Pursuant to Bankruptcy Rule 4001(c)
15. Bankruptcy Rule 4001(c) does not require the disclosure of any provision in the
Interim Fee Order because the Interim Fee Order does not provide the EFIH Debtors with any
authority to obtain credit. In accordance with Bankruptcy Rules 4001(c) and (d), the following
summarizes the significant terms of the EFIH First Lien DIP Credit Agreement and the Final
Order.
13

Material Terms Summary of Material Terms Provision
EFIH First Lien
DIP Credit
Agreement Parties
Fed. R. Bankr. P.
4001(c)(1)(B)

Borrower: EFIH and EFIH Finance, Inc.
Guarantors: None
Left Lead DIP Facility Arranger: Deutsche Bank Securities Inc.
Joint Lead Arrangers: The Left Lead DIP Facility Arranger, Citi
Group Global Markets Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Morgan Stanley
Senior Funding, Inc., Barclays Bank PLC, RBC
Capital Markets and Union Bank, N.A..
Lenders: The lenders under the Term Facility.
Administrative Agent: Deutsche Bank AG New York Branch
(together with its permitted successors and assigns
EFIH First Lien
DIP Credit
Agreement at 1.1.

EFIH First Lien
DIP Financing
Fed. R. Bankr. P.
4001(c)(1)(B); LBR
4001-2(a)(ii)
Total Loan Commitment: $5.40 billion aggregate principal amount
at Full Availability.
Junior Incremental Facility: One or more incremental term loan
facilities that will rank junior in right of payment with the DIP Facility
and will have the same guarantees as the DIP Facility, and be secured
by a lien on the same Collateral securing the DIP Facility that is junior
to the lien securing the DIP Facility, in a principal amount not to
exceed $3,000,000,000 in the aggregate subject to certain provisos,
including that the principal amount of the Junior Incremental Term
Facility shall be convertible into equity under the Plan of
Reorganization.
EFIH First Lien
DIP Credit
Agreement at 1.1,
2.1, 2.2, 2.14.

Interest Rate and
The Borrower may elect that the loans comprising each borrowing bear
interest at a rate per annum equal to (a) the Alternate Base Rate plus
EFIH First Lien

13
This statement is based on the current versions of the EFIH First Lien DIP Documents and the Final Order, as
applicable, which remain subject to ongoing negotiation and will be filed with the Court as soon as possible.
This statement is qualified in its entirety by the provisions of the EFIH First Lien DIP Documents and Final
Order as eventually filed with the Court, and to the extent there exists any inconsistency between this concise
statement and the provisions of the EFIH First Lien DIP Documents or the Final Order, the provisions of the
EFIH First Lien DIP Documents or the Final Order, as applicable, shall control.
12

Margins
Fed. R. Bankr. P.
4001(c)(1)(B)
the Applicable Margin or (b) the Adjusted LIBO Rate plus 2.25%, in
the case of ABR Loans and 3.25 %, in the case of Eurodollar Loans,
subject to a floor of 1% per annum.
DIP Credit
Agreement at 2.8.

Fees
Fed R. Bankr. P.
4001(c)(1)(B)
**Confidential, Filed Under Seal** EFIH First Lien
DIP Credit
Agreement at 3.1.
Maturity
Fed. R. Bankr. P.
4001(c)(1)(B)
The maturity date of the EFIH First Lien DIP Financing will be the
earliest of:
stated maturity, which shall be __________ (24 months
from the Closing Date (defined below)) subject to
extensions under certain conditions;
the effective date of any Reorganization Plan;
the date that is 120 days after the execution of the
Commitment Letter if the Final Order Entry Date has not
occurred by such date;
the consummation of a sale of all or substantially all of the
EFIH Debtors assets or stock under section 363 of the
Bankruptcy Code; or
the acceleration of any Loans and the termination of any
then outstanding Commitments in accordance with the terms
of this Agreement.
The Maturity Date will occur in any event no later than 30 months
from the Closing Date.
EFIH First Lien
DIP Credit
Agreement at 1.1.

Purpose/Use of
Proceeds
Fed. R. Bankr. P.
4001(c)(1)(B); LBR
4001-2(a)(ii)
The proceeds of the DIP Facility will be used, in a manner consistent
with the terms of the Budget: (i) first, to pay (x) transaction fees,
liabilities and expenses and other administration costs and (y) the
refinancing of the EFIH First Lien Secured Notes, and (ii) second, to
finance any and all working capital needs and for any other general
corporate purposes, and to comply with any legal and/or regulatory
requirements.
EFIH First Lien
DIP Credit
Agreement at
8.16.

Events of Default
Fed. R. Bankr. P.
4001(c)(1)(B)
The occurrence and continuance of any of the following events shall
constitute an Event of Default under the DIP Facility (consistent, in
each case, with the Documentation Principles):
defaults usual and customary for financings of this type,
including, without limitation, non-payment of principal,
interest and fees, defaults under affirmative and negative
covenants, breaches of representations and warranties,
judgments or foreclosure actions exceeding certain
thresholds, adverse modifications to the Orders, and
dismissal or conversion of the bankruptcy cases; and
the Final Order Entry Date shall not have occurred or (ii) the
Term Facility shall not have been funded in full within
certain time frames.
EFIH First Lien
DIP Credit
Agreement at 10.

13

Priority and
Security of EFIH
First Lien DIP
Financing Liens
Fed. R. Bankr. P.
4001(c)(1)(B)
All obligations of the Debtors to the Agent and the Lenders (such
persons, collectively, the DIP Secured Parties) under the Loan
Documents (the Obligations), including all Loans made under the
DIP Facilities, shall, subject to the Carve-Out (defined below), and to
the extent provided in the EFIH First Lien DIP Credit Agreement and
subject to any limitations therein:
pursuant to Bankruptcy Code section 364(c)(1), be entitled
to joint and several superpriority administrative expense
claim status in the Cases, on a pari passu basis;
pursuant to Bankruptcy Code section 364(c)(2), be secured
by a perfected first priority lien on substantially all now
owned or hereafter acquired assets of the EFIH Debtors that
are not otherwise subject to a lien, including, upon the entry
of the Final Order, the proceeds of causes of action under
chapter 5 of the Bankruptcy Code;
pursuant to section 364(c)(3) of the Bankruptcy Code, be
secured by a perfected junior lien on all other prepetition
and postpetition property of the EFIH Debtors that is subject
to valid, perfected and non-avoidable liens in existence
immediately prior to the Petition Date or that are perfected
subsequent to the Petition Date as permitted by section
546(b) of the Bankruptcy Code (other than the Adequate
Protection Liens); and
pursuant to Bankruptcy Code section 364(d), be secured by
a perfected priming first-priority lien on all prepetition and
postpetition property of the EFIH Debtors.
Expected in Final
Order

Carve Out
Fed. R. Bankr. P.
4001(c)(1)(B)
All liens securing the Obligations, liens or claims securing the
Obligations and other prepetition obligations, including, among others,
those in connection with the Existing Primed Secured Facilities, shall
be subject and subordinate to the Carve Out.
The Carve Out means the sum of (i) all fees required to be paid to
the Clerk of the Court and to the Office of the United States Trustee
under section 1930(a) of title 28 of the United States Code plus interest
at the statutory rate (without regard to the notice set forth in
(iii) below); (ii) all reasonable fees and expenses up to $50,000
incurred by a trustee under section 726(b) of the Bankruptcy Code
(without regard to the notice set forth in (iii) below); (iii) to the extent
allowed at any time, whether by interim order, procedural order, or
otherwise, all unpaid fees and expenses (the Allowed Professional
Fees) incurred by persons or firms retained by the EFIH Debtors
pursuant to section 327, 328, or 363 of the Bankruptcy Code (the
Debtor Professionals) and any Creditors Committee appointed in
the Cases pursuant to section 1103 of the Bankruptcy Code (the
Committee Professionals and, together with the Debtor
Professionals, the Professional Persons) at any time before or on the
first business day following delivery by the DIP Agent of a Carve Out
Trigger Notice (as defined below), whether allowed by the Court prior
to or after delivery of a Carve Out Trigger Notice; and (iv) Allowed
Expected in Final
Order

14

Professional Fees of Professional Persons in an aggregate amount not
to exceed $25,000,000 incurred after the first business day following
delivery by the DIP Agent of the Carve Out Trigger Notice, to the
extent allowed at any time, whether by interim order, procedural order,
or otherwise (the amounts set forth in this clause (iv) being the Post-
Carve Out Trigger Notice Cap). For purposes of the foregoing,
Carve Out Trigger Notice shall mean a written notice delivered by
email (or other electronic means) by the DIP Agent to the EFIH
Debtors, their lead restructuring counsel, the U.S. Trustee, and lead
counsel to the Creditors Committee and the Collateral Trustee, which
notice may be delivered following the occurrence and during the
continuation of an Event of Default and acceleration of the DIP
Obligations under the DIP Facility, stating that the Post-Carve Out
Trigger Notice Cap has been invoked.
The EFIH Debtors shall deposit and hold in a segregated account the
Carve Out Reserves, which, following the delivery of certain Trigger
Notices, shall be applied by the Borrower to pay obligations arising
from the Carve-Out.
Nothing in the Interim Fee Order,the Final Order or otherwise shall be
construed to obligate the DIP Agent or the DIP Lenders, in any way, to
pay compensation to, or to reimburse expenses of, any Professional
Person or to guarantee that the EFIH Debtors have sufficient funds to
pay such compensation or reimbursement.
Conditions to
Borrowing
Fed. R. Bankr. P.
4001(c)(1)(B)
1. Interim Order/Bankruptcy Matters
Entry of the Interim Fee Order, as defined in the EFIH First
Lien DIP Commitment Letter, within 10 business days of the
Petition Date;
Entry of the Final Order, which shall provide for, among
other things, funding of the EFIH First Lien DIP Facility and
consummation of the EFIH First Lien Refinancing, within
110 days after the date of the Commitment Letter;
No adverse modifications or stays to the Interim Fee Order or
the Final Order without the consent of the Left Lead DIP
Facility Arranger;
Any order with respect to cash collateral in respect of the
EFIH First Lien Notes or EFIH Second Lien Notes shall be in
form and substance satisfactory to the Left Lead DIP Facility
Arranger; and
Certain other customary provisions relating to compliance
with the Orders, entry of first day motions, no appointment
of a trustee or examiner with expanded powers.
2. Financial Statements, Budgets and Reports
The EFIH Debtors shall provide certain customary budgeting
information
3. Performance of Obligations
EFIH First Lien
DIP Credit
Agreement at 6.

15

The EFIH Debtors shall be in compliance with all obligations
under the EFIH First Lien DIP Documents.
4. Customary Closing Documents and Other Conditions
Delivery of customary legal opinions and certain certificates
and notices of borrowing; (ii) evidence of authority; and
(iii) obtaining of any governmental consents, if any, necessary
in connection with the DIP Facilities.
The Loan Documents (which shall be consistent with the
Documentation Principles) shall have been entered into by the
Debtors.
The Agent shall have received results of a Uniform
Commercial Code search for the jurisdiction of organization
of the Debtors and such other lien and/or other searches
reasonably requested by the Agent as are customary for
transactions of this type.
The Agent shall have received proper financing statements
(Form UCC-1 or the equivalent) for filing under the UCC in
the jurisdiction of organization of each Debtor.
As a result of the extension of such credit, usage of the
Commitments shall not exceed (i) the applicable
Commitments then in effect and (ii) the aggregate amount
authorized by the Interim Order.
1. Final Order
If any order authorizes the EFIH First Lien Refinancing with
the proceeds of the EFIH First Lien DIP Facility, the EFIH
First Lien Notes shall be repaid.
Acknowledgments
Fed. R. Bankr. P.
4001(c)(1)(B)(iii)
EFIH shall make customary representations and warranties regarding
the perfection and priority of liens securing EFIH First Lien DIP
Financing, and amount and nature of existing indebtedness.
Expected in Final
Order

Plan and
Disclosure
Statement
Milestones
Fed. R. Bankr. P.
4001(c)(1)(B)(vi)
The Borrower shall file with the Bankruptcy Court a plan of
reorganization and a disclosure statement relating thereto, each in form
and substance reasonably satisfactory to the Administrative Agent,
within 18 months after the Petition Date; provided, however, that with
respect to provisions of the plan of reorganization and/or any
disclosure statement that relate to payment of the Credit Facilities,
such provisions must be in form and substance satisfactory to the
EFIH First Lien
DIP Credit
Agreement at
8.14
Waivers and
Consents
Fed. R. Bankr. P.
4001(c)(1)(B)(iv,
v), (vii-x)
Waiver of Automatic Stay: Upon the occurrence of an Event of
Default and following the giving of five calendar days notice to EFIH
(the Remedies Notice Period), the automatic stay pursuant to section
362 of the Bankruptcy Code shall be automatically terminated without
further notice to or order of the Bankruptcy Court, and the Agent shall
be permitted to exercise all rights against the Collateral in accordance
with the Loan Documents and the Interim Order or Final Order, as
applicable, and shall be permitted to satisfy the Obligations, without
Expected in Final
Order

16

further order or application or motion to the Bankruptcy Court and
without restriction or restraint by any stay under section 362 or 105 of
the Bankruptcy Code. Notwithstanding anything herein to the
contrary, the automatic stay pursuant to section 362 of the Bankruptcy
Code shall be automatically terminated for the purposes of giving any
notice contemplated hereunder.
Waiver of Nonbankruptcy Law: The EFIH First Lien DIP Liens and
other interests granted to the Agent and EFIH First Lien DIP Lenders
are deemed valid, binding, perfected, enforceable, first-priority liens,
non-avoidable and not subject to re-characterization or subordination
as of the date of the Interim EFIH DIP Order.
Waiver of Section 506(c): Usual and customary 506(c) waiver.
Indemnification: Usual and customary for financings of this type,
including that Borrower shall indemnify, pay and hold harmless the
Agent, the Joint Lead Arrangers, and the Lenders and their affiliates
(and their respective controlling persons, directors, officers, partners,
employees, agents, advisors and other representatives (collectively, the
Related Parties)) (each, an Indemnified Person) against any loss,
claim, damage, liability or expense incurred in respect of EFIH First
Lien DIP Financing contemplated hereby or the use of proceeds
thereof or the Transactions or any claim, litigation, investigation or
proceeding (a Proceeding) relating to any of the foregoing, with
customary exceptions for gross negligence, bad faith, willful
misconduct or material breach of such Indemnified Person or its
Related Parties.
Release of Claims and Causes of Action: The EFIH Debtors release
the EFIH First Lien DIP Agent, the EFIH First Lien DIP Lenders and
each of their respective participants, and each of their respective
affiliates, and each of their respective former, current, or future
officers, employees, directors, agents, representatives, owners,
members, partners, financial advisors, legal advisors, shareholders,
managers, consultants, accountants, attorneys, affiliates, and
predecessors in interest, of and from any and all claims arising out of,
in connection with, or relating to the EFIH First Lien DIP Financing,
the EFIH First Lien DIP Documents, or the transactions contemplated
thereunder.
Provisions to be Highlighted Pursuant to Local Bankruptcy Rule 4001-2(a)(i)
16. Local Bankruptcy Rule 4001-2(a)(i) requires a debtor to: (a) recite whether the
proposed form of the financing order contains certain provisions of the type enumerated therein;
(b) identify the location of such provisions in the proposed financing order; and (c) justify the
inclusion of such provisions in the proposed financing order (the Highlighted Provisions). See
Del. Bankr. L.R. 4001-2(a)(i). No provisions in the Interim Fee Order require disclosure under
17

Local Bankruptcy Rule 4001-2(a)(i). The EFIH Debtors disclose the following provisions that
are expected to be included in the Final Order that require highlighting under Local Bankruptcy
Rule 4001-2(a)(i), specifically with respect to Local Bankruptcy Rules 4001-2(a)(i)(E) and (G).
17. Use of Postpetition Loans from Prepetition EFIH Secured Creditors. Local
Bankruptcy Rule 4001-2(a)(i)(E) requires the disclosure of the use of the proceeds of
postpetition financing to repay prepetition indebtedness. The EFIH Debtors will use a large
portion of the proceeds of the EFIH First Lien DIP Financing, including the EFIH First Lien DIP
Roll-Up Claims, to execute the EFIH First Lien Refinancing, the EFIH First Lien Settlement,
and the EFIH Second Lien Settlement. Each of the Prepetition EFIH First Lien Creditors and
Prepetition EFIH Second Lien Creditors will be given the opportunity to participate in the
applicable settlement. Importantly, having significant commitments from Settling EFIH First
Lien Creditors will also improve the overall terms of the new money syndication.
18. The EFIH First Lien DIP Financing does not pose the risks that typically
accompany roll-up DIP facilities. There was sufficient market capacity to fund the EFIH First
Lien DIP Financing in full without relying on commitments from the Prepetition EFIH First Lien
Creditors, and, in fact, the EFIH Debtors do not yet know whether (and to what extent)
non-settling Prepetition EFIH First Lien Creditors will participate in the syndication. As a result,
the Prepetition EFIH First Lien Creditors participation in the syndication of the EFIH First Lien
DIP Financing (other than with respect to the EFIH First Lien Settlement) is on the same terms
as the other new money lenders and does not impose onerous terms on the EFIH Debtors that
are typically associated with roll-up DIP facilities. Accordingly, the EFIH Debtors respectfully
submit that the participation of certain Prepetition EFIH First Lien Creditors in the syndication of
18

the EFIH DIP Financing and the roll-up provisions of the EFIH First Lien Settlement and
Fidelitys portion of the EFIH Second Lien Settlement are appropriate.
19. Priming Liens. Local Bankruptcy Rule 4001-2(a)(i)(G) requires disclosure of
provisions that prime any secured liens without that lienholders consent. The EFIH First Lien
DIP Financing grants the EFIH First Lien DIP Lenders a valid, binding, continuing, enforceable,
fully-perfected first priority senior priming security interest in and lien upon all prepetition and
postpetition property of the EFIH Debtors pursuant to section 364(d)(1) of the Bankruptcy Code.
20. As an initial matter, no Prepetition EFIH Secured Creditors are being primed
under the Interim Fee Order because the Interim Fee Order merely seeks the approval of certain
fees and expenses as administrative expense claims. Upon entry of the Final Order, the EFIH
Debtors will use the funds available under the EFIH First Lien DIP Financing to repay the
Prepetition EFIH First Lien Creditors in full. As a result, the EFIH First Lien DIP Lenders are
not priming the Prepetition EFIH First Lien Creditors. Similarly, the EFIH Debtors plan to
execute the EFIH Second Lien Refinancing concurrently with entry of the Final Order and the
EFIH First Lien Refinancing, so the Prepetition EFIH Second Lien Creditors are not being
primed. The EFIH Debtors will revisit whether and to what extent any adequate protection is
necessary if the EFIH Second Lien Refinancing has not occurred when the Final Order is
entered. The EFIH First Lien DIP Lenders are not priming other secured creditors (if any) of the
EFIH Debtors.
21. The EFIH Debtors and their advisors determined that the EFIH First Lien DIP
Lenders offered the best option for obtaining the postpetition financing the EFIH Debtors
require, and the EFIH Debtors are not able to obtain financing on equal or better terms from the
EFIH First Lien DIP Lenders other than financing secured by first priority priming liens.
19

Moreover, the priming liens are a key aspect of the EFIH First Lien Settlement and EFIH Second
Lien Settlement. Accordingly, the imposition of priming liens under section 364(d), to the extent
any Prepetition EFIH Secured Claims remain outstanding at the time the Final Order is entered,
is necessary and appropriate under the circumstances.
22. 506(c) Waiver. Local Bankruptcy Rule 4001-2(a)(i)(C) requires disclosure of
provisions that constitute a waiver, without notice, of whatever rights the estate may have under
section 506(c) of the Bankruptcy Code. The Final Order will provide that the EFIH First Lien
DIP Agent and the EFIH First Lien DIP Lenders are each entitled to a waiver of the provisions of
section 506(c) of the Bankruptcy Code. Accordingly, while the EFIH Debtors do not believe
that the 506(c) waiver requires disclosure under Local Bankruptcy Rule 4001-2(a)(i)(C), they
have disclosed it out of an abundance of caution and for the convenience of the Court and other
parties in interest.
23. Carve Out. Local Bankruptcy Rule 4001-2(a)(i)(F) requires disclosure of
disparate treatment between the professionals retained by the EFIH Debtors and the
professionals retained by the unsecured creditors committee with respect to a professional fee
carve out. Here, the Carve Out that will be sought under the Final Order will apply equally to
professionals retained by the EFIH Debtors and any statutory committee. Accordingly, while the
EFIH Debtors do not believe that the terms of the Carve Out require disclosure under Local
Bankruptcy Rule 4001-2(a)(i)(F), they have disclosed the provision out of an abundance of
caution and for the convenience of the Court and other parties in interest.
Background
24. On the date hereof (the Petition Date), each of the Debtors filed a voluntary
petition with the Court under chapter 11 of the Bankruptcy Code. The Debtors are operating
20

their businesses and managing their property as debtors in possession pursuant to
sections 1107(a) and 1108 of the Bankruptcy Code. The Debtors have requested joint
administration of these chapter 11 cases. The Court has not appointed a trustee, and the Office
of the United States Trustee for the District of Delaware (the U.S. Trustee) has not formed any
official committees in these chapter 11 cases.
14

25. Debtor Energy Future Holdings Corp. (EFH Corp.), a Texas corporation, is the
ultimate parent company for each of the Debtors in these chapter 11 cases and certain of EFH
Corp.s non-Debtor affiliates (collectively, EFH). EFHs businesses include the largest
generator, distributor, and certified retail provider of electricity in Texas. EFH conducts
substantially all of its business operations in the electricity market overseen by the Electric
Reliability Council of Texas (ERCOT), which covers the majority of Texas. The Texas
electricity market, in turn, is subject to oversight and regulation by the Public Utility
Commission of Texas (the PUC). EFH has approximately 9,100 employees, approximately
5,700 of whom are employed by the Debtors,
15
in three distinct business units:
EFHs competitive electricity generation, mining, wholesale electricity sales, and
commodity risk management and trading activities, conducted by TCEH LLCs
Debtor subsidiaries composing Luminant;

14
The facts and circumstances supporting this Motion, along with a detailed discussion of EFHs business
operations and capital structure, are set forth in the Declaration of Paul Keglevic, Executive Vice President,
Chief Financial Officer, and Co-Chief Restructuring Officer of Energy Future Holdings Corp., et al., in Support
of First Day Motions (the First Day Declaration), filed contemporaneously herewith.
15
The Debtors in these chapter 11 cases consist of: (a) the vast majority of the entities that compose Luminant
and TXU Energy, as well as those entities intermediate corporate parent entity, Texas Competitive Electric
Holdings Company LLC (TCEH LLC), a Delaware limited liability company, and TCEH LLCs corporate
parent, Energy Future Competitive Holdings Company LLC (EFCH), a Delaware limited liability company;
(b) Energy Future Intermediate Holding Company LLC (EFIH), a Delaware limited liability company that
indirectly owns approximately 80% of Oncor Electric Delivery Holdings Company LLC (Oncor), and EFIHs
wholly-owned subsidiary, EFIH Finance Inc.; (c) EFH Corp.; and (d) other direct and indirect subsidiaries of
EFH Corp., including EFH Corporate Services Company.
21

EFHs competitive retail electricity sales operations and related operations, mainly
conducted by TCEH LLCs Debtor subsidiaries composing TXU Energy;
16
and
EFHs rate-regulated electricity transmission and distribution operations,
conducted by the non-Debtor Oncor.
26. In the aggregate, the Debtors have approximately $42 billion of funded
indebtedness, including (a) approximately $32.1 billion of claims against TCEH LLC and TCEH
LLCs direct and indirect Debtor subsidiaries; (b) approximately $70 million of claims against
EFCH; (c) approximately $1.9 billion of claims against EFH Corp.; and (d) approximately $7.7
billion of claims against EFIH.
17

27. Although the Debtors balance sheet is overleveraged, the Debtors operations are
strong. Luminants generation units are high-performing, its mining and electricity generation
operations have impressive safety records, and its commodity trading and risk management
activities have delivered significant value to the Debtors. TXU Energy is an industry leader in
customer care performance and product innovation and has maintained strong performance
notwithstanding intense competition. And non-Debtor Oncor produces a strong and consistent
stream of revenue. Thus, these chapter 11 cases will provide the Debtors with the opportunity to
restructure their balance sheets and retain their position as leaders in the Texas electricity market.
28. As of December 31, 2013, EFH Corp. reported total assets of approximately
$36.4 billion in book value, approximately $28.8 billion of which is attributable to EFCH,
TCEH LLC, and TCEH LLCs direct and indirect subsidiaries (collectively with TCEH LLC and

16
The Debtors also conduct a relatively small amount of retail electricity operations through their 4Change brand
and another entity, Luminant ET Services Company, that provides retail electricity service to some end use
customers and to some of Luminants mining operations, and a small amount of retail gas operations through
Luminant Energy Company LLC.
17
Amounts include intercompany debt holdings and short-term borrowings, and exclude guarantees, unamortized
discounts or premiums, accrued but unpaid interest, and certain other figures typically reported in the Debtors
filings with the Securities and Exchange Commission (the SEC), such as capital lease obligations, certain
promissory notes, and certain other obligations.
22

EFCH, TCEH),
18
and total liabilities of approximately $49.7 billion in book value,
approximately $41.1 billion of which is attributable to TCEH.
19
EFH Corp.s assets and
liabilities that are not attributable to TCEH are mostly attributable to EFIHs indirect ownership
of approximately 80% of Oncor. EFH Corp.s consolidated revenues for the quarter ending
December 31, 2013 were approximately $1.3 billion, all of which were attributable to
TCEH. EFH Corp.s consolidated annual revenues for the year ending December 31, 2013 were
approximately $5.9 billion.
EFIHs Outstanding Prepetition Secured Indebtedness
I. EFIH First Lien Notes.
29. EFIH First Lien 2017 Notes. Pursuant to that certain indenture (the EFIH First
Lien 2017 Notes Indenture) dated August 14, 2012, for the 6.875% senior secured notes due
August 15, 2017 (the EFIH First Lien 2017 Notes), by and among EFIH and EFIH Finance,
Inc. (EFIH Finance), as issuers, and CSC Trust Company of Delaware (CSC), as successor
indenture trustee (the EFIH First Lien Notes Trustee) to The Bank of New York Mellon Trust
Company, N.A. (BNY), EFIH and EFIH Finance issued approximately $503 million in
principal amount of the EFIH First Lien 2017 Notes.
30. EFIH First Lien 2020 Notes. Pursuant to that certain indenture (the EFIH First
Lien 2020 Notes Indenture and, together with the EFIH First Lien 2017 Notes Indenture,
the EFIH First Lien Notes Indentures), dated August 17, 2010, for the 10.00% senior secured
notes (the EFIH First Lien 2020 Notes, and together with the EFIH First Lien 2017 Notes,

18
Oncors revenues are not included in EFH Corp.s consolidated revenues because EFH Corp. accounts for its
ownership of Oncor under the equity method of accounting.
19
Figures for TCEH are derived from EFCHs public filings with the SEC, and are almost entirely attributable to
TCEH LLC and its Debtor and non-Debtor subsidiaries.
23

the EFIH First Lien Notes) due December 1, 2020, by and among EFIH and EFIH Finance, as
issuers, and the EFIH First Lien Notes Trustee, EFIH issued approximately $3.482 billion in
principal amount of the EFIH First Lien 2020 Notes. The Prepetition EFIH First Lien
Creditors shall mean the EFIH First Lien Notes Trustee and the holders of EFIH First Lien
Notes.
31. First Lien Collateral. The EFIH First Lien Notes are secured by first priority
security interests in and liens (the Prepetition EFIH First Priority Liens) in the Collateral
(the Prepetition EFIH Collateral), as defined in the EFIH First Lien Indentures and the EFIH
Collateral Trust Agreement (as defined below), including substantially all of EFIHs assets,
including cash to the extent that such cash constitutes proceeds of other Prepetition EFIH
Collateral (EFIH Cash Collateral).
II. EFIH Second Lien Notes.
32. EFIH Second Lien Notes. Pursuant to that certain indenture (the EFIH Second
Lien Notes Indenture, and together with EFIH First Lien Notes Indentures, the Prepetition
EFIH Secured Indentures), dated April 25, 2011, by and among EFIH, as issuers,
Computershare Trust Company, N.A. and Computershare Trust Company of Canada
(Computershare) as successor indenture trustee to BNY (the EFIH Second Lien Notes
Trustee, and together with EFIH First Lien Notes Trustee, the Prepetition EFIH Secured
Trustees), EFIH issued two series of notes: (a) approximately $406 million principal amount of
11.00% EFIH Second Lien Notes due October 1, 2021 (the EFIH Second Lien 2021 Notes);
and (b) approximately $1.750 billion principal amount of 11.75% EFIH Second Lien Notes due
March 1, 2022 (the EFIH Second Lien 2022 Notes, and together with EFIH Second Lien 2021
Notes, the EFIH Second Lien Notes). The Prepetition EFIH Second Lien Creditors shall
24

mean the holders of EFIH Second Lien Notes. The Prepetition EFIH Secured Creditors shall
mean the Prepetition EFIH Second Lien Creditors together with the Prepetition EFIH First Lien
Creditors. The Prepetition EFIH Secured Notes shall mean the EFIH First Lien Notes together
with the EFIH Second Lien Notes.
33. Second Lien Collateral. The Prepetition EFIH Second Lien Obligations are
secured by second priority liens (the Prepetition EFIH Second Priority Liens and, together with
the Prepetition EFIH First Priority Liens, the Prepetition EFIH Liens) in the Prepetition EFIH
Collateral.
III. Other EFIH Secured Debt Documents.
34. Security Documents. In connection with the issuance of the EFIH First Lien
Notes and EFIH Second Lien Notes, the EFIH Debtors entered into: (a) the Security Documents
(as defined in the EFIH First Lien Indentures, and collectively with the EFIH First Lien
Indentures, the EFIH First Lien Secured Notes, and the Registration Rights Agreements executed
in connection therewith, the EFIH First Lien Documents); and (b) the Security Documents (as
defined in the EFIH Second Lien Indenture, and collectively with the EFIH Second Lien
Indenture, the EFIH Second Lien Secured Notes, and the Registration Rights Agreements
executed in connection therewith, the EFIH Second Lien Documents).
35. EFIH Collateral Trust Agreement. The EFIH Collateral Trust Agreement (as
amended, restated, modified, and supplemented from time to time, the EFIH Collateral Trust
Agreement) entered into by and among EFIH, and CSC, in its capacity as EFIH First Lien
Notes Trustee and Collateral Trustee under the EFIH First Lien Documents and EFIH Second
Lien Documents, and Computershare, in its capacity as EFIH Second Lien Notes Trustee,
governs, among other things, the relative priority of the EFIH First Lien Notes and the EFIH
25

Second Lien Notes and the relative rights and remedies of the Prepetition EFIH First Lien
Creditors and the Prepetition EFIH Second Lien Creditors with respect to, among other things,
debtor-in-possession financing, use of EFIH Cash Collateral, and adequate protection. In
particular, pursuant to section 2.8 of the EFIH Collateral Trust Agreement, the Prepetition EFIH
Second Lien Creditors are bound by the actions and consents of the Collateral Trustee with
respect to any debtor-in-possession financing or use of EFIH Cash Collateral if such actions
result from the direction of holders of at least a majority of the outstanding EFIH First Lien
Notes. Moreover, any payments to the Prepetition EFIH Second Lien Creditors before the EFIH
First Lien Notes are refinanced will be subject to turnover to the Prepetition EFIH First Lien
Creditors pursuant to the terms of the EFIH Collateral Trust Agreement. See EFIH Collateral
Trust Agreement 2.4(c).
Development of the EFIH DIP Budget and the EFIH Debtors
Need for Use of Cash Collateral and the EFIH First Lien DIP Financing
36. The EFIH Debtors, with the assistance of their financial advisors and other
advisors, developed an initial three-month budget for these chapter 11 cases, attached hereto as
Exhibit C (the EFIH DIP Budget). As of the Petition Date, the EFIH Debtors have
approximately $119 million of EFIH Cash Collateral. In conjunction with the EFIH Debtors
access to EFIH Cash Collateral (which, for the avoidance of doubt, will not occur until the entry
of the Final Order), the EFIH First Lien DIP Financing will provide the EFIH Debtors with the
liquidity necessary to fund the EFIH Debtors restructuring-related expenses, satisfy their
corporate obligations, and execute the EFIH First Lien Refinancing and the EFIH Secured
Settlements.
37. The EFIH DIP Budget incorporates a number of factors, including the effect of
the chapter 11 filing, material cash disbursements, and expected dividends from Oncor. As
26

provided in the EFIH DIP Budget, the EFIH Debtors believe that approximately $1 billion in
liquidity would be necessary over a 26-month period. None of those amounts, however, are
needed in the first 30 days of the case. As a result, the EFIH Debtors are not seeking interim
financing or use of EFIH Cash Collateral pursuant to the Interim Fee Order.
38. The relief requested pursuant to the Final Order will maximize the value of the
EFIH Debtors estates. The EFIH First Lien Refinancing will reduce the EFIH Debtors interest
expense by an estimated $13 million per month during the course of these chapter 11 cases. See
Goldstein Declaration 8. The EFIH Secured Settlements allow the EFIH Debtors to minimize
litigation risk around the EFIH Makewhole Claims that would total nearly $1.4 billion in the
aggregate if payable on the Petition Date (approximately $700 million attributable to the EFIH
First Lien Notes and EFIH Second Lien Notes, respectively), build consensus around a
restructuring, and, in conjunction with the EFIH Second Lien DIP Financing, effect a substantial
deleveraging of the EFIH Debtors. And the EFIH First Lien DIP Financing provides the EFIH
Debtors with highly favorable financing to satisfy their other restructuring-related obligations.
Accordingly, the EFIH Debtors have determined that the EFIH First Lien DIP Financing is in the
best interests of their estates.
39. The benefits of the EFIH First Lien DIP Financing are highly apparent, and any
delay diminishes those benefits. Accordingly, the EFIH Debtors respectfully request that the
Court enter the Interim Order to ensure the continuing availability of the EFIH DIP Financing
and, following the Final Hearing, the Final Order.
The EFIH Debtors Efforts to Obtain Postpetition Financing
40. As discussed in the Goldstein Declaration, the EFIH Debtors decision to proceed
with the EFIH First Lien DIP Financing comes after a thorough search for the best available
27

financing alternatives. In January 2014, the EFIH Debtors and Evercore initiated a request for
proposals (the RFP) with respect to the EFIH First Lien DIP Financing. During the initial
stage of the RFP process, the EFIH Debtors approached seven large financial institutions with
active involvement in the debtor-in-possession and syndicated finance markets that had executed
non-disclosure agreements. The EFIH Debtors explained their goals and potential DIP financing
structures to the participating banks, and invited those banks to submit term sheets that reflected
pricing and structuring possibilities. From February 3 through February 7, the EFIH Debtors and
Evercore hosted calls to discuss the RFP with each of the participating banks.
41. Of the seven participating banks that received RFPs, six submitted proposals
between February 7 and 11. The proposals varied significantly with respect to, among other
things, key economic terms, the size of the DIP facility, whether there would be last in/first out
participants or other junior components, and whether and on what terms the EFIH Debtors would
be permitted to obtain additional junior financing. See Goldstein Declaration 11-15. The EFIH
Debtors and their advisors evaluated the proposals and, in certain instances, posed follow-up
questions to the participating banks in advance of in-person meetings on February 10 and 11.
About a week after those in-person meetings, the EFIH Debtors submitted a revised RFP to the
six participating banks that reflected the EFIH Debtors preferred structure for the EFIH First
Lien DIP Financing. The EFIH Debtors continued their discussions with the participating banks
on February 19 and 20 and distributed a term sheet to the participating banks on February 21.
42. From February 26 through March 2, the EFIH Debtors selected lead bank roles
and invited all of the participating banks to participate in the EFIH First Lien DIP Financing
(subject to final negotiations). On March 4, the EFIH Debtors distributed a draft commitment
letter and fee letter to lead banks. Throughout March and April, the EFIH Debtors continued
28

negotiations with the lead banks, focusing on a variety of issues, including fee structures and
structuring the EFIH First Lien DIP Financing to provide for the EFIH First Lien Settlement and
EFIH Second Lien Settlement, and drafted definitive documents. Finally, on April 29, 2014, the
EFIH Debtors and arranging banks executed commitment papers.
43. Ultimately, the EFIH Debtors determined, in consultation with their professional
advisors, that the EFIH First Lien DIP Financing is the best source of financing at this time. The
EFIH Debtors and the EFIH First Lien DIP Lenders negotiated the EFIH First Lien DIP
Financing at arms length on terms that are reasonable. The interest rates, fees, covenants, and
events of default, taken as a whole, reflect the most favorable terms available in the market and
are consistent with the terms of DIP financing approved in other large chapter 11 cases. The
EFIH Debtors discussions with various potential sources of EFIH First Lien DIP Financing
revealed that such financing on a junior or unsecured basis was not available to the EFIH
Debtors on terms that were competitive with the EFIH First Lien DIP Financing. Specifically,
EFIHs significant secured debt obligations and lack of material unencumbered assets precludes
the EFIH Debtors from obtaining postpetition financing in the amount they require on terms
other than on a secured and superpriority basis.
44. The EFIH Debtors did receive one proposal for a junior financing that would have
satisfied some liquidity needs associated with restructuring expenses, rather than providing
financing only for a refinancing (the Original Second Lien DIP Proposal). The liens securing
the Original Second Lien DIP Proposal would have been junior to the liens securing the EFIH
First Lien Notes and pari passu with the liens securing the EFIH Second Lien Notes. The EFIH
Debtors did not pursue the Original Second Lien DIP Proposal for a number of reasons: it
contemplated only partial equitization of the EFIH Second Lien Notes, it presumed the EFIH
29

Second Lien Makewhole Claim would receive a 100% recovery, it provided insufficient
incremental liquidity to satisfy the EFIH Debtors restructuring expenses, and it provided no
clear path to execute the EFIH First Lien Refinancing. Moreover, the EFIH Debtors concluded
that there was no reasonable likelihood that the Original Second Lien DIP Proposal could be
revisited to provide for the same level of deleveraging or for the same level of consensus as the
transactions currently contemplated. Thus, the EFIH Debtors concluded that the Original Second
Lien DIP Proposal would not maximize the value of the EFIH Debtors estates.
The EFIH First Lien Settlement and EFIH Second Lien Settlement
45. As discussed in more detail in the Settlement Motion, negotiations regarding the
EFIH First Lien Settlement and EFIH Second Lien Settlement began to crystalize in mid-March,
2014, after certain holders of first lien claims against TCEH indicated that they would be willing
to support a tax-free spin transaction. As discussed above, each of the EFIH First Lien
Settlement and EFIH Second Lien Settlement contemplate that settling creditors will receive
either EFIH First Lien Roll-Up Claims or cash.
46. The terms of the settlements, including the amount of the roll-ups, the fee
structure applicable to the roll-ups, and the amount of cash payments funded by the proceeds of
the EFIH First Lien DIP Financing, and the terms under which the EFIH First Lien DIP Lenders
would permit settling creditors to participate in the EFIH First Lien DIP Financing (and,
therefore, lower the overall new money commitment) were subject to significant negotiation
among the EFIH Debtors and their stakeholders. The EFIH Debtors believe that the EFIH First
Lien Settlement and the EFIH Second Lien Settlement are fair and reasonable, and that the
30

issuances under the EFIH First Lien DIP Financing to fund the settlements, whether with roll-up
notes or cash, are in the best interest of the EFIH Debtors, their estates, and their stakeholders.
20

Basis for Relief
I. The Fees Payable Under the Interim Fee Order Should Be Approved.
47. The EFIH Debtors respectfully request that the Court authorize them, as an
exercise of their sound business judgment and as an actual and necessary expense, to pay the
Interim Fees. These fees, which are a subset of the overall fees payable under the EFIH First
Lien DIP Documents, are composed of the Ticking Fee and the DIP Facilities Fee, each as
defined in the EFIH First Lien DIP Fee Letter, which has been filed under seal. Additionally, the
Interim DIP Order provides for the payment of certain out-of-pocket expenses, including
professional fees. None of these amounts will actually be paid until the earlier of the entry of the
Final Order or an order authorizing the EFIH Debtors to use EFIH Cash Colleteral. Approval of
the Interim Fees is appropriate under sections 363(b) and 503(b) of the Bankruptcy Code.
48. In the Third Circuit, certain fees are payable if they satisfy the standards
applicable to administrative expense claims under section 503(b) of the Bankruptcy Code. See,
e.g., In re Reliant Energy Channelview LP, 594 F.3d 200, 205-06 (3d Cir. 2010) (citing Calpine
Corp. v. OBrien Envt Energy, Inc. (In re OBrien Envt Energy, Inc.), 181 F.3d 527 (3d Cir.
1999) (holding that fees would be payable if appropriate under section 503(b)). To qualify for
such treatment, an expense must be necessary to preserve the value of the debtors estate.
Reliant Energy, 594 F.3d at 206. Other courts approve fees under the business judgment
standard applicable to section 363(b) of the Bankruptcy Code. See, e.g., In re ASARCO, L.L.C.,
650 F.3d 593, 601 (5th Cir. 2011) (comparing the business judgment standard under section 363

20
For the avoidance of doubt, the to-be-filed Settlement Motion, rather than this Motion, will seek the authority to
approve the EFIH First Lien Settlement and the EFIH Second Lien Settlement.
31

against the administrative expense standard under section 503(b)); In re Bethlehem Steel Corp.,
No. 02-2854, 2003 WL 21738964, *8-9 (S.D.N.Y. Jul. 28, 2003) (citing instances of courts
approving breakup and diligence fees under section 363(b) to justify authorization of payment of
union fees). Generally speaking, debtors are authorized to use estate property outside the
ordinary course of business where the use is justified by a sound business purpose. See, e.g., In
re Abbotts Dairies, Inc., 788 F.2d 143 (3d Cir. 1986) (holding that use should be authorized
where supported by a sound business justification); Computer Sales Intl Inc. v. Fed. Mogul
Global, Inc. (In re Fed. Mogul Global, Inc.), 293 B.R. 124, 126 (D. Del. 2003) (same).
Importantly, courts in this district commonly authorize the payment of fees before financings
close in the context of exit financing. See, e.g., In re Rotech Healthcare, Inc., No. 13-10741
(PJW) (Bankr. D. Del. Jul. 29, 2013) (authorizing certain up-front fees, payment of professional
expenses, and indemnification obligations prior to the closing of an exit financing); In re
NewPage Corp., No. 11-12804 (KG) (Bankr. D. Del. Nov. 6, 2012) (same); In re Appleseeds
Intermediate Holdings LLC, No. 11-10160 (KG) (Bankr. D. Del. Mar. 29, 2011) (same); In re
Visteon Corp., No. 09-11786 (CSS) (Bankr. D. Del. Aug. 31, 2010) (same).
21

49. The Interim Fees satisfy both section 363(b) and section 503(b) of the Bankruptcy
Code. Indeed, the same reasoning applies here as applies in the exit financing context: without
the authorization of fees, the commitment is likely to expire. DIP financings, unlike exit
financings, typically have immediate borrowings that facilitate the immediate payment of fees,
but the fact that the EFIH First Lien DIP Financing does not have such an interim mechanism to
approve fees does not make the financing any less beneficial to the EFIH Debtors estates.

21
Because of the voluminous nature of the orders cited herein, such orders are not attached to this Motion. Copies
of these orders are available upon request of the Debtors counsel.
32

50. Approval of the Interim Fees will enable the EFIH Debtors to guarantee the
highly favorable terms of the EFIH First Lien DIP Financing pending the Final Hearing on the
EFIH First Lien Refinancing and while the EFIH Debtors solicit participation in the EFIH
Makewhole Settlements and the Court considers the Settlement Motion. Importantly, the EFIH
First Lien DIP Financing and EFIH First Lien Refinancing will be consummated even if the
EFIH Makewhole Settlements are not yet consummated when the Final Order is entered, or even
if the EFIH Makewhole Settlements are not approved. Accordingly, the benefit to the EFIH
Debtors is not contingent upon the Courts approval of the Settlement Motion.
51. As discussed above, the Interim Fees were the subject of hard-fought, arms-
length negotiations between the EFIH Debtors and the EFIH First Lien DIP Lenders, and the
EFIH First Lien DIP Lenders are unwilling to hold their commitment open without the payment
of the Interim Fees. Absent the relief requested in the Interim Fee Order, the EFIH First Lien
DIP Lenders funding commitment will expire, which would impose costs and delay as a result
of a remarketing process. Participation in the EFIH Secured Settlements may be depressed by a
lack of certainty regarding financing. The EFIH Debtors will incur significant additional interest
expense and may not be able to obtain similar financing on the same terms in a remarketing
process. Perhaps most importantly, delay could cause the EFIH Debtors to fail to satisfy the
milestones in the Restructuring Support Agreement, which could cause the agreement to
terminate. Accordingly, the Interim Fees satisfy both section 363(b), because the EFIH Debtors
decision to pay such fees is supported by sound business purposes, and section 503(b), because
the Interim Fees are an actual and necessary expense to maximize the value of the EFIH Debtors
estates.
33

52. Importantly, prompt entry of the Interim Fee Order is necessary. The EFIH First
Lien DIP Lenders commitments will expire unless the Interim Fee Order is entered within
10 business days of the Petition Date. Accordingly, for the reasons set forth above, entry of the
Interim Order is critical to avert immediate and irreparable harm to the EFIH Debtors estate and
is consistent with, and warranted under Bankruptcy Rule 6003(b).
II. The EFIH Debtors Should Be Authorized to Obtain Postpetition Financing Through
the EFIH First Lien DIP Financing.
A. Entry into EFIH First Lien DIP Credit Agreement is an Exercise of the
EFIH Debtors Sound and Reasonable Business Judgment.
53. The Court should authorize the EFIH Debtors, as an exercise of the EFIH
Debtors sound business judgment, to enter into EFIH First Lien DIP Credit Agreement and
obtain access to EFIH First Lien DIP Financing.
54. Section 364 of the Bankruptcy Code authorizes a debtor to obtain secured or
superpriority financing under certain circumstances as described in greater detail below.
Provided that an agreement to obtain secured credit does not run afoul of the provisions of, and
policies underlying, the Bankruptcy Code, courts grant a debtor considerable deference in acting
in accordance with its sound business judgment in obtaining such credit. See, e.g., Trans World
Airlines, Inc. v. Travelers Intl AG (In re Trans World Airlines, Inc.), 163 B.R. 964, 974 (Bankr.
D. Del. 1994) (approving postpetition loan and receivables facility because such facility
reflect[ed] sound and prudent business judgment.); In re L.A. Dodgers LLC, 457 B.R. 308, 313
(Bankr. D. Del. 2011) ([C]ourts will almost always defer to the business judgment of a debtor in
the selection of the lender.); In re Barbara K. Enters., Inc., No. 08-11474, 2008 WL 2439649,
at *14 (Bankr. S.D.N.Y. June 16, 2008) (explaining that courts defer to a debtors business
judgment so long as a request for financing does not leverage the bankruptcy process and
34

unfairly cede control of the reorganization to one party in interest.); In re Ames Dept Stores,
Inc., 115 B.R. 34, 40 (Bankr. S.D.N.Y. 1990) ([c]ases consistently reflect that the courts
discretion under section 364 [of the Bankruptcy Code] is to be utilized on grounds that permit [a
debtors] reasonable business judgment to be exercised so long as the financing agreement does
not contain terms that leverage the bankruptcy process and powers or its purpose is not so much
to benefit the estate as it is to benefit a party-in-interest.); In re Farmland Indus., Inc., 294 B.R.
855, 881 (Bankr. W.D. Mo. 2003) (noting that approval of postpetition financing requires, inter
alia, an exercise of sound and reasonable business judgment.).
55. Specifically, to determine whether the business judgment standard is met, a court
is required to examine whether a reasonable business person would make a similar decision
under similar circumstances. In re Exide Techs., 340 B.R. 222, 239 (Bankr. D. Del. 2006); see
also In re Curlew Valley Assocs., 14 B.R. 506, 51314 (Bankr. D. Utah 1981) (noting that courts
should not second guess a debtors business decision when that decision involves a business
judgment made in good faith, upon a reasonable basis, and within the scope of [the debtors]
authority under the [Bankruptcy] Code.) (citation omitted).
56. The EFIH Debtors execution of the EFIH First Lien DIP Credit Agreement is an
exercise of their sound business judgment that warrants approval by the Court. Before the
Petition Date, the EFIH Debtors and their advisors analyzed the EFIH Debtors projected
financing needs during these chapter 11 cases, and determined that the EFIH Debtors would
require postpetition financing to support their restructuring activities. Additionally, the EFIH
Debtors and their advisors determined that executing the EFIH First Lien Refinancing would
dramatically reduce EFIHs interest obligations going forward. Finally, as described in more
detail in the Settlement Motion, the EFIH First Lien Settlement and EFIH Second Lien
35

Settlement are each in the best interests of the EFIH Debtors estates because the settlements will
minimize litigation risk and facilitate the speedy resolution of the EFIH Debtors chapter 11
cases. Accordingly, the EFIH Debtors negotiated the EFIH First Lien DIP Financing with the
EFIH First Lien DIP Lenders in good faith, at arms length, and with the assistance of their
advisors to obtain the required postpetition financing on terms most favorable to the EFIH
Debtors. And, as discussed above, the EFIH Debtors have determined that the EFIH First Lien
DIP Financing is the best available financing alternative. Thus, entry into EFIH First Lien DIP
Financing is an exercise of the EFIH Debtors sound business judgment.
B. The EFIH Debtors Should Be Authorized to Obtain Postpetition Financing
on a Senior Secured and Superpriority Basis.
57. Section 364 of the Bankruptcy Code authorizes a debtor to obtain, in certain
circumstances, postpetition financing on a secured or superpriority basis, or both. Specifically,
section 364(c) of the Bankruptcy Code provides, in pertinent part, that the Court, after notice and
a hearing, may authorize a debtor that is unable to obtain credit allowable as an administrative
expense under section 503(b)(1) of the Bankruptcy Code to obtain credit or incur debt:
(a) with priority over any or all administrative expenses of the kind specified in
section 503(b) or 507(b) of [the Bankruptcy Code];
(b) secured by a lien on property of the estate that is not otherwise subject to a
lien; or
(c) secured by a junior lien on property of the estate that is subject to a lien.
11 U.S.C. 364(c).
58. To satisfy the requirements of section 364(c) of the Bankruptcy Code, a debtor
need only demonstrate by a good faith effort that credit was not available to the debtor on an
unsecured or administrative expense basis. Bray v. Shenandoah Fed. Sav. & Loan Assoc. (In re
Snowshoe Co.), 789 F.2d 1085, 1088 (4th Cir. 1986); see also, L.A. Dodgers, 457 B.R. at 313
36

(citing Ames Dept Store, 115 B.R. at 37 (noting the court may not approve any credit
transaction under subsection (c) [of section 364] unless the debtor demonstrates that it has
attempted, but failed, to obtain unsecured credit under section 364(a) or (b)). The statute
imposes no duty to seek credit from every possible lender before concluding that such credit is
unavailable. Id.; see also Pearl-Phil GMT (Far East) Ltd. v. Caldor Corp., 266 B.R. 575, 584
(S.D.N.Y. 2001) (superpriority administrative expenses authorized where debtor could not obtain
credit as an administrative expense). When few lenders are likely to be able and willing to
extend the necessary credit to a debtor, it would be unrealistic and unnecessary to require [the
debtor] to conduct such an exhaustive search for financing. In re Sky Valley, Inc., 100 B.R.
107, 113 (Bankr. N.D. Ga. 1988), affd sub nom. Anchor Sav. Bank FSB v. Sky Valley, Inc., 99
B.R. 117, 120 n.4 (N.D. Ga. 1989); see also Ames Dept Stores, 115 B.R. at 40 (approving
financing facility and holding that the debtor made reasonable efforts to satisfy the standards of
section 364(c) where it approached four lending institutions, was rejected by two, and selected
the most favorable of the two offers it received); In re Garland Corp., 6 B.R. 456, 461 (B.A.P.
1st Cir. 1980) (secured credit under section 364(c)(2) authorized, after notice and a hearing, upon
showing that unsecured credit unobtainable); In re Stanley Hotel, Inc., 15 B.R. 660, 663 (D.
Colo. 1981) (bankruptcy courts finding that two national banks refused to grant unsecured loans
was sufficient to support conclusion that section 364 requirement was met).
59. The EFIH Debtors discussions with various potential sources of EFIH First Lien
DIP Financing revealed that such financing on a junior or unsecured basis was not available to
the EFIH Debtors on terms that were competitive with the EFIH First Lien DIP Financing.
Specifically, the EFIH Debtors significant secured debt obligations and lack of material
unencumbered assets preclude the EFIH Debtors from obtaining postpetition financing in the
37

amount they require on terms other than on a secured and superpriority basis. As discussed
above, the EFIH Debtors evaluatedand ultimately rejectedthe only junior proposal that
would have replaced any portion of the EFIH First Lien DIP Financing because that proposal had
inferior economic terms, provided insufficient liquidity, and did not maximize the value of the
EFIH Debtors estates. The Court should therefore authorize the EFIH Debtors to provide the
EFIH First Lien DIP Agent, on behalf of itself, the other EFIH First Lien DIP Lenders, the
Secured Hedge Banks, and the Secured Cash Management Banks, (a) senior liens on the EFIH
Debtors unencumbered property as provided in section 364(c)(2) of the Bankruptcy Code,
(b) junior liens on the EFIH Debtors encumbered property, and (c) superpriority administrative
expense claims as provided for in section 364(c)(1) of the Bankruptcy Code.
C. The EFIH Debtors Should Be Authorized to Obtain Postpetition Financing
Secured by First Priority Priming Liens.
60. In addition to authorizing financing under section 364(c) of the Bankruptcy Code,
courts also may authorize a debtor to obtain postpetition credit secured by a lien that is senior or
equal in priority to existing liens on the encumbered property, without the consent of the existing
lienholders, if the debtor cannot otherwise obtain such credit and the interests of existing
lienholders are adequately protected. See 11 U.S.C. 364(d)(1).
61. When determining whether to authorize a debtor to obtain credit secured by a
priming lien as authorized by section 364(d) of the Bankruptcy Code, courts focus on whether
the transaction will enhance the value of the EFIH Debtors assets. Courts consider a number of
factors, including, without limitation:
(a) whether alternative financing is available on any other basis (i.e., whether any
better offers, bids, or timely proposals are before the court);
38

(b) whether the proposed financing is necessary to preserve estate assets and is
necessary, essential and appropriate for continued operation of the debtors
business;
(c) whether the terms of the proposed financing are reasonable and adequate
given the circumstances of both the debtors and proposed lender(s); and
(d) whether the proposed financing agreement was negotiated in good faith and at
arms length and entry therein is an exercise of sound and reasonable business
judgment and in the best interest of the debtors estate and its creditors.
See, e.g., Ames Dept Stores, 115 B.R. at 3739; Bland v. Farmworker Creditors, 308 B.R. 109,
113-14 (S.D. Ga. 2003); Farmland Indus., 294 B.R. at 86279, In re Lyondell Chem. Co.,
No. 09-10023 (Bankr. S.D.N.Y. Mar. 5, 2009); Barbara K. Enters., 2008 WL 2439649 at *10;
see also 3 Alan N. Resnick & Henry J. Sommer, Collier on Bankruptcy 364.04[1] (16th ed.).
Even assuming that a priming analysis is relevant here with respect to the EFIH Second Lien
Notes (to the extent the EFIH Second Lien Refinancing has not been executed when the Final
Order is entered), the EFIH First Lien DIP Financing satisfies each of these factors.
62. First, as described above, the EFIH Debtors and their advisors canvassed the
market and were not able to obtain financing on equal or better terms from the EFIH First Lien
DIP Lenders other than financing secured by first priority priming liens.
63. Second, the EFIH Debtors need the funds to be provided under EFIH First Lien
DIP Financing to maximize the value of their estates. Specifically, the EFIH Debtors need the
funds to be provided under EFIH First Lien DIP Financing to pay restructuring-related expenses,
terminate their obligations to pay above-market interest rates on the EFIH First Lien Notes, and
to facilitate the EFIH First Lien Settlement and the EFIH Second Lien Settlement. Thus, the
EFIH First Lien DIP Financing is necessary to maximize the value of the EFIH Debtors estates
and is in the best interest of all stakeholders.
39

64. Third, the EFIH Debtors and their advisors determined that the EFIH First Lien
DIP Lenders offered the best option for obtaining the postpetition financing the EFIH Debtors
require to satisfy their general corporate obligations and restructuring expenses and the means to
consummate the EFIH First Lien Refinancing, EFIH First Lien Settlement, and EFIH Second
Lien Settlement. Accordingly, the terms of the EFIH First Lien DIP Credit Agreement are
reasonable and adequate to support the EFIH Debtors general corporate needs and restructuring
activities through the pendency of these chapter 11 cases and maximize the value of the EFIH
Debtors estates by effecting a refinancing of the EFIH First Lien Notes.
65. Fourth, the EFIH Debtors negotiated with the EFIH First Lien DIP Lenders at
arms length regarding the terms of the EFIH First Lien DIP Financing. The interest rates, fees
(including the fees payable under the Interim Order), covenants, and events of default, taken as a
whole, reflect the most favorable terms available in the market and, as described in more detail
below, are consistent with the terms of DIP financing approved in other large chapter 11 cases.
66. For these reasons, the priming liens under the EFIH First Lien DIP Financing are
appropriate under section 364(d) of the Bankruptcy Code and should be approved.
D. The Payment of Fees to the EFIH First Lien DIP Lenders Under the
Proposed Final Order is Appropriate.
67. The EFIH Debtors have agreed, subject to Court approval, to pay certain fees (in
addition to the fees the EFIH Debtors seek to approve under the Interim Fee Order) to the EFIH
First Lien DIP Agent, the EFIH First Lien DIP Lenders, and the Joint Lead Arrangers in
exchange for their providing the EFIH First Lien DIP Financing. The fees the EFIH Debtors
have agreed to pay, together with the other provisions of the EFIH First Lien DIP Documents,
represent the most favorable terms to the EFIH Debtors on which the EFIH First Lien DIP
Agent, the EFIH First Lien DIP Lenders, and the Joint Lead Arrangers would agree to make the
40

EFIH First Lien DIP Financing available. The EFIH Debtors considered such fees when
determining in their sound business judgment that the EFIH First Lien DIP Financing provided
the best terms on which the EFIH Debtors could obtain the financing necessary to satisfy their
restructuring-related obligations and consummate the EFIH First Lien Refinancing, the EFIH
First Lien Settlement, and the EFIH Second Lien Settlement. Accordingly, the EFIH Debtors
believe that paying these fees to obtain the EFIH First Lien DIP Financing is in the best interests
of the EFIH Debtors estates, creditors, and other parties in interest.
68. Courts routinely authorize debtors to pay fees similar to those the EFIH Debtors
propose to pay pursuant to the Final Order, as described in the EFIH First Lien DIP Fee Letter
and the EFIH First Lien DIP Commitment Letter, where the associated financing is, in the
debtors business judgment, beneficial to the debtors estates. Indeed, the fees here are smaller
on a percentage basis than the fees approved in many other cases. See, e.g., In re Exide Techs.,
No. 13-11482 (KJC) (Bankr. D. Del. Jul. 25, 2013) (approving approximately 4.7% of aggregate
fees to underwriters, arrangers, and lenders); In re LSP Energy Ltd. Pship, No. 12-10460
(Bankr. D. Del Feb. 27, 2012) (approving 1.25 percent commitment fee); In re Friendly Ice
Cream Corp., No. 11-13167 (Bankr. D. Del. Nov. 2, 2011) (approving certain letter of credit fees
including a 2 percent issuance fee); In re Sea Launch Co., L.L.C., No. 09-12153 (Bankr. D. Del.
May 12, 2010) (approving 3.75-percent DIP break-up fee); In re Cooper-Standard Holdings Inc.,
No. 09-12743 (Bankr. D. Del. Sept. 2, 2009) (approving 2.5 percent upfront fee and 2.5 percent
exit fee); In re Hayes Lemmerz Intl, Inc., No. 09-11655 (Bankr. D. Del. June 15, 2009)
(approving 3 percent exit fee); In re Aleris Intl. Inc., No. 09-10478 (Bankr. D. Del. Mar. 18,
2009) (approving 3.5-percent exit fee and 3.5% front-end net adjustment against each lenders
initial commitment); In re Dura Auto. Sys., Inc., No. 06-11202 (Bankr. D. Del. Jan. 30, 2008)
41

(approving a 2.5-percent fee related to refinancing and extending a postpetition financing
facility); see also In re Great Atl. & Pac. Tea Co., No. 10-24549 (Bankr. S.D.N.Y. Jan. 11,
2011) (approving 3-percent letter of credit fee); In re InSight Health Servs. Holdings Corp.,
No. 10-16564 (Bankr. S.D.N.Y. Jan. 4, 2011) (approving 2.5-percent DIP closing fee); In re Neff
Corp., No. 10-12610 (Bankr. S.D.N.Y. June 30, 2010) (approving 3.1-percent DIP and exit
facility fee); In re Readers Digest Assn, No. 09-23529 (Bankr. S.D.N.Y. Oct. 6, 2009)
(approving 3.0-percent exit fee); In re Lear Corp., No. 09-14326 (Bankr. S.D.N.Y. Aug. 4, 2009)
(approving 5.0-percent upfront fee and a 1.0-percent exit/conversion fee); In re Gen. Growth
Props., Inc., No. 09-11977 (Bankr. S.D.N.Y. May 14, 2009) (approving 3.75-percent exit fee); In
re Tronox Inc., No. 09-10156 (Bankr. S.D.N.Y. Feb. 9, 2009) (approving an up-front 3-percent
facility fee). Accordingly, the Court should authorize the EFIH Debtors to pay the fees provided
under EFIH First Lien DIP Financing Documents (in addition to the fees the EFIH Debtors seek
to pay under the Interim Fee Order) in connection with entering into those agreements.
E. The Scope of the Carve Out is Appropriate.
69. The proposed EFIH First Lien DIP Financing subjects the security interests and
administrative expense claims of the EFIH First Lien DIP Lenders to the Carve Out. Carve outs
for professional fees have been found to be reasonable and necessary to ensure that a debtors
estate and any statutory committee can retain assistance from counsel. See Ames, 115 B.R. at 40.
The EFIH First Lien DIP Financing does not directly or indirectly deprive the EFIH Debtors
estates or other parties in interest of possible rights and powers by restricting the services for
which professionals may be paid in these cases. See id. at 38 (observing that courts insist on
carve outs for professionals representing parties-in-interest because [a]bsent such protection, the
collective rights and expectations of all parties-in-interest are sorely prejudiced). Additionally,
42

the Carve Out protects against administrative insolvency during the course of these chapter 11
cases by ensuring that assets remain for the payment of U.S. Trustee fees and professional fees of
the EFIH Debtors and an official committee of unsecured creditors, notwithstanding the grant of
superpriority and administrative liens and claims under the EFIH First Lien DIP Financing.
70. Moreover, with the inclusion of the Carve Out, the Orders do not directly or
indirectly deprive the EFIH Debtors estates or other parties in interest of possible rights and
powers by restricting the services for which professionals may be paid in the Chapter 11 Cases.
See In re Ames Dept. Stores, 115 B.R. at 38 (observing that courts insist on carve outs for
professionals representing parties in interest because [a]bsent such protection, the collective
rights and expectations of all parties-in-interest are sorely prejudiced). In Ames, the court found
such carve-outs for professional fees to be not only reasonable, but necessary to ensure that
official committees and debtors estates can retain assistance from counsel. Id. at 41.
71. Similar carve outs for professional fees have been found to be reasonable and
necessary in this district to ensure that a debtors estate and any statutory committee can retain
assistance from counsel. See, e.g., In re Longview Power, LLC, No. 13-12211 (BLS) (Bankr. D.
Del. Sept. 5, 2013) (allowing carve out for debtor and committee professional fees); In re Dex
One Corp., No. 13-10533 (KG) (Bankr. D. Del. Mar. 19, 2013) (same); In re Amicus Wind Down
Corp., No. 11-13167 (KG) (Bankr. D. Del. Nov. 2, 2011) (same); In re Neb. Book Co., Inc.,
No. 11-12005 (PJW) (Bankr. D. Del. July 21, 2011) (same); In re Local Insight Media Holdings,
Inc., No. 10-13677 (KG) (Bankr. D. Del. Dec. 29, 2010) (same); In re N. Am. Petroleum Corp.
USA, No. 10-11707 (CSS) (Bankr. D. Del. July 6, 2010) (same); In re Stallion Oilfield Servs.
Ltd., No. 09-13562 (BLS) (Bankr. D. Del. Nov. 18, 2009) (same).
43

F. The Roll-Ups are Appropriate.
72. The EFIH Makewhole Settlements contemplate the issuance of EFIH First Lien
DIP Roll-Up Claims. Section 363(b) of the Bankruptcy Code permits a debtor to use, sell, or
lease property outside the ordinary course of business with court approval so long as the Debtors
demonstrate a sound business purpose. See, e.g., Abbotts Dairies, 788 F.2d at 143 (holding that
use should be authorized where supported by a sound business justification); In re Fed. Mogul
Global, Inc., 293 B.R. at 126 (same).
73. The EFIH Debtors do not seek approval of the EFIH Makewhole Settlements
pursuant to this Motion. That relief will be sought in the Settlement Motion, which will be filed
on or shortly after the Petition Date. In the event the Court approves the EFIH Makewhole
Settlements, however, the EFIH Debtors will need funds to satisfy those settlements. The roll-up
aspects of the EFIH First Lien DIP Financing are appropriate for that purpose. Indeed, the EFIH
Makewhole Settlements, along with the other transactions contemplated by the Settlement
Motion and the Restructuring Support Agreement, will allow the EFIH Debtors to emerge from
these chapter 11 cases in an expeditious and tax-efficient manner. The EFIH Debtors will still
need to litigate the EFIH First Lien Makewhole Claims and EFIH Second Lien Makewhole
Claims with non-settling holders, but the ability to settle a significant portion of the EFIH
Makewhole Claims and achieve support for the EFIH Debtors broader restructuring effort is
vitally important.
74. By contrast, if this Court does not approve the roll-ups, creditors may declare a
termination event under the Restructuring Support Agreement. Importantly, this could cause the
EFIH Debtors to lose the opportunity to refinance the EFIH Second Lien Notes with the
proceeds of an EFIH Second Lien DIP Facility that is mandatorily convertible to equity upon the
44

consummation of a plan of reorganization, jeopardizing the EFIH Debtors reorganization
efforts.
75. This Court recently approved a DIP facility that included a roll-up of make-whole
claims in In re School Specialty, Inc., Case No. 13-1015 (KJC) (Bankr D. Del. Mar. 14, 2014)
(authorizing up to $155 million in DIP financing that included roll-up of between $67 million
and $92 million in prepetition debt pursuant to interim and final orders, which amounts included
a prepayment claim). And roll-ups are commonly approved in this district. See, e.g., In re Mach
Gen, LLC, No. 14-10461 (MFW) (Bankr. D. Del. Mar. 27, 2014) (authorizing up to $200 million
in DIP financing that included roll-up of approximately $144 million of prepetition debt pursuant
to interim and final orders); In re Furniture Brands Intl, Inc., No. 13-12329 (CSS) (Bankr. D.
Del. Oct. 11, 2013) (authorizing up to $140 million in DIP financing that included roll-up of
approximately $91 million prepetition debt pursuant to interim order); In re WP Steel Venture
LLC, No. 12-11661 (KJC) (Bankr. D. Del. June 1, 2012) (authorizing up to $525 million in DIP
financing that included roll-up of approximately $475 million prepetition debt pursuant to
interim order); In re Neb. Book Co., No. 11-12005 (PJW) (Bankr. D. Del. July 21, 2011)
(authorizing up to $200 million in DIP financing that included roll-up of approximately $30
million prepetition debt pursuant to interim order); In re Indianapolis Downs, LLC,
No. 11-11046 (BLS) (Bankr. D. Del. Apr. 26, 2011) (authorizing up to $103 million in DIP
financing that included roll-up of approximately $98 million prepetition debt pursuant to interim
order); In re NEC Holdings Corp., No. 10-11890 (PJW) (Bankr. D. Del. July 16, 2010)
(authorizing up to $138 million in DIP financing that included roll-up of approximately $109.7
million prepetition debt pursuant to interim and final orders).
45

G. The EFIH First Lien DIP Financing Was Negotiated in Good Faith and
Should Be Afforded the Protection of Section 364(e) of the Bankruptcy Code.
76. Section 364(e) of the Bankruptcy Code protects a good faith lenders right to
collect on loans extended to a debtor, and its right in any lien securing those loans, even if the
authority of the debtor to obtain such loans or grant such liens is later reversed or modified on
appeal. Specifically, section 364(e) provides that:
The reversal or modification on appeal of an authorization under
this section [364 of the Bankruptcy Code] to obtain credit or incur
debt, or of a grant under this section of a priority or a lien, does not
affect the validity of any debt so incurred, or any priority or lien so
granted, to an entity that extended such credit in good faith,
whether or not such entity knew of the pendency of the appeal,
unless such authorization and the incurring of such debt, or the
granting of such priority or lien, were stayed pending appeal.
11 U.S.C. 364(e).
77. The EFIH First Lien DIP Financing was negotiated in good faith and at arms
length among the EFIH Debtors, the EFIH First Lien DIP Agent, and the EFIH First Lien DIP
Lenders, and all of EFIH First Lien DIP Financing obligations will be extended by the EFIH
First Lien DIP Lenders in good faith (as such term is used in section 364(e) of the Bankruptcy
Code). No consideration is being provided to any party in connection with the EFIH First Lien
DIP Financing other than as described in this Motion, the EFIH First Lien DIP Commitment
Letter, and the EFIH First Lien DIP Fee Letter. Moreover, the EFIH First Lien DIP Financing
has been extended in express reliance upon the protections afforded by section 364(e) of the
Bankruptcy Code. The EFIH First Lien DIP Agent and EFIH First Lien DIP Lenders are entitled
to the full protection of section 364(e) of the Bankruptcy Code in the event that the Interim Order
or any provision thereof is vacated, reversed, or modified on appeal or otherwise. See 11 U.S.C.
46

364(e). Accordingly, the EFIH First Lien DIP Agent and the EFIH First Lien DIP Lenders are
good faith lenders within the meaning of section 364(e) of the Bankruptcy Code.
H. Modification of the Automatic Stay Provided Under Section 362
of the Bankruptcy Code is Appropriate Under the Circumstances.
78. The Final Order will contain provisions that provide that the automatic stay
imposed under section 362(a) of the Bankruptcy Code be lifted to allow the EFIH First Lien DIP
Agent and EFIH First Lien DIP Lenders, in their sole discretion, to file the Final Order or such
financing statements, mortgages, deeds of trust, notices of lien, or similar instruments or
otherwise confirm perfection of such liens, security interests, and mortgages. The Final Order is
also likely to propose that, upon five days written notice to the EFIH Debtors, their counsel, and
the Collateral Trustee, the automatic stay imposed under section 362(a) of the Bankruptcy Code
be lifted to allow the EFIH First Lien DIP Agent and EFIH First Lien DIP Lenders to exercise
remedies following a default under EFIH First Lien DIP Financing.
79. Stay modification provisions of this sort are ordinary and usual features of debtor
in possession financing facilities and, in the EFIH Debtors business judgment, are reasonable
under the present circumstances. Accordingly, the Court should modify the automatic stay to the
extent contemplated under EFIH First Lien DIP Credit Agreement and the proposed Orders.
III. The Court Should Authorize the Repayment of the EFIH First Lien Notes Because
Doing So Is in the Best Interests of the Debtors and Their Estates.
80. Section 363(b)(1) of the Bankruptcy Code provides that [t]he trustee, after notice
and a hearing, may use, sell or lease, other than in the ordinary course of business, property of
the estate. 11 U.S.C. 363(b)(1). Whether use of assets pursuant to section 363(b) of the
Bankruptcy Code should be approved in a particular case is a matter left to the Courts
discretion, giving due consideration to the sound business judgment of the proponent of the
47

particular transaction. See, e.g., Comm. of Equity Sec. Holders v. Lionel Corp. (In re Lionel
Corp.), 722 F. 2d 1063, 1071 (2d Cir. 1983) (court may approve a transaction involving property
of the estate that is outside of the ordinary course of business when the court finds a good
business reason for such transaction). When determining whether a debtor has exercised its
business judgment, this Court is required to examine whether a reasonable business person
would make a similar decision under similar circumstances. In re AbitibiBowater Inc., 418
B.R. 815, 831 (Bankr. D. Del. 2009) (business judgment rule in the contract assumption
process). Moreover, section 105(a) of the Bankruptcy Code provides this Court with the ability
to issue any order, process, or judgment that is necessary or appropriate to further the
paramount policy and goal of Chapter 11the rehabilitation of a debtor. 11 U.S.C. 105(a);
In re Ionosphere Clubs, Inc., 98 B.R. 174, 176-77 (Bankr. S.D.N.Y. 1989).
81. There is nothing unprecedented about the EFIH First Lien Refinancing. In In re
Calpine Corp., 356 B.R. 585 (S.D.N.Y. 2007), the district court upheld on appeal the bankruptcy
courts decision to allow Calpine to use a combination of asset sale and postpetition financing
proceeds to refinance a portion of Calpines above-market prepetition debt. Id. at 589-90 (noting
that the bankruptcy court found that the refinancing was appropriate to allow Calpine to stop
hemorrhaging cash). Later in the same case, Calpine was permitted to use the proceeds of a
new postpetition facility to refinance both postpetition and prepetition financing. See In re
Calpine Corp., 365 B.R. 392, 396 (Bankr. S.D.N.Y. 2007). More recently, American Airlines
was permitted to refinance a significant portion of its prepetition secured equipment leases with
the proceeds of postpetition financing. In re AMR Corp., 485 B.R. 279, 283-84 (Bankr.
S.D.N.Y. 2013) (holding that use of postpetition financing to repay prepetition debt is
permissible if supported by sound business reasons), affd In re AMR Corp., 730 F.3d 88 (2nd
48

Cir. 2013); see also In re School Specialty, Inc., No. 13-10125 (KJC) (Bankr. D. Del. Mar. 14,
2013) (authorizing postpetition financing to repay postpetition and prepetition claims).
82. There can be no dispute that repaying the EFIH First Lien Notes is in the best
interests of the EFIH Debtors estates. Interest savings of up to $13 million per month speaks
for itself. Under these circumstances, the EFIH Debtors plainly should be authorized under
sections 363(b) and 105(a) of the Bankruptcy Code to repay the EFIH First Lien Notes.
IV. The Court Should Find that the Value of the EFIH First Lien Notes Does Not
Include the Amount of any Makewhole Premium.
83. Bankruptcy Rule 3012 provides that this Court may determine the value of a
claim secured by a lien on property in which the estate has an interest on motion of any party in
interest and after a hearing on notice to the holder of the secured claim. This Court, like the
bankruptcy court in Calpine, may determine the value of the Prepetition EFIH First Lien
Creditors claims against the EFIH Debtors in connection with its consideration of the EFIH First
Lien Refinancing. See also 11 U.S.C. 502(b) (providing that a court shall determine the
amount of [claims].).
22

84. As discussed in greater detail in the First Lien Makewhole Memorandum that will
be filed with the Court shortly following the Petition Date, the Court should enforce the plain
terms of the EFIH First Lien Indentures and affirm that the EFIH Debtors repayment of the
EFIH First Lien Notesaccelerated by the commencement of these Chapter 11 casesdoes not
entitle the Prepetition EFIH First Lien Creditors to any EFIH First Lien Makewhole Premium.
The law is well-settled that secured creditors may only recover a makewhole premium if that

22
The EFIH Debtors do not seek any determination pursuant to this Motion of the value of the Prepetition EFIH
Second Lien Creditors claims. That said, the EFIH Debtors position is that no EFIH Second Lien Makewhole
Claim will be due in connection with the EFIH Second Lien Refinancing, and will similarly seek a
determination that any such premium is not properly includable in the allowed amount of the Prepetition EFIH
Second Lien Creditors claims.
49

payment is expressly require[d] by contract. In re S. Side House, LLC, 451 B.R. 248, 268
(Bankr. E.D.N.Y. 2011); see 11 U.S.C. 506(b). Without such a provision, no makewhole or
other damages are recoverable after acceleration. HSBC Bank USA, Nat. Assn v. Calpine
Corp., 07 CIV 3088 GBD, 2010 WL 3835200, at *4 (S.D.N.Y. Sept. 15, 2010).
85. The EFIH First Lien Indentures do not provide for a premium when the
outstanding debt is accelerated by the EFIH Debtors chapter 11 filing. 11 U.S.C. 506(b). The
parties agreed that an Applicable Premium, which is defined in exquisite detail, might be due
in certain circumstancesand even incorporated that definition elsewhere in the EFIH First Lien
Indentures. See EFIH First Lien Indentures 3.07 (Optional Redemption). But the
acceleration provision, which was triggered when the EFIH Debtors filed for chapter 11, does
not reference that term Applicable Premium. Nor does it mention the Optional Redemption
provision that incorporates that term. In fact, the acceleration provision does not even contain
the word premium at all. The intent of the parties in these circumstances is plain: the EFIH First
Lien Makewhole Premium is not due upon the consummation of the EFIH First Lien
Refinancing after the EFIH First Lien Notes chapter 11-induced acceleration.
86. The EFIH Debtors chapter 11 filing accelerated the EFIH First Lien Notes,
which became due and payable immediately without further action or notice. EFIH First Lien
Indentures 6.02. That acceleration change[d] the date of maturity from some point in the
future ... to an earlier date based on the debtor's default under the contract. In re AMR Corp.,
730 F.3d 88, 103 (2d Cir. 2013) (citation omitted). Accordingly, as courts across the country
have repeatedly held, the proposed repayment is not a voluntary prepayment because
[p]repayment can only occur prior to the maturity date. Id. (quoting In re Solutia, 379 B.R
473, 488 (Bankr. S.D.N.Y. 2007)); accord HSBC Bank USA, Nat. Assn v. Calpine Corp., No. 07
50

Civ. 3088 (GBD), 2010 WL 3835200, at *5 (S.D.N.Y. Sept. 15, 2010); In re S. Side House, LLC,
451 B.R. at 268; In re LHD Realty Corp., 726 F.2d 327, 33031 (7th Cir. 1984). Repayment
here is mandated by the plain language of the acceleration provision, which itself makes no
mention of a makewhole premium.
87. Accordingly, the EFIH Debtors request that the Court determine the secured claim
on account of the EFIH First Lien Notes is allowed in the amount of $3.985 billion, plus accrued
and unpaid interest and any other fees or expenses properly allowable under the EFIH First Lien
Indentures, but excluding any EFIH First Lien Makewhole Premium.
Request For Final Hearing
88. Pursuant to Bankruptcy Rules 4001(c)(2) and Local Bankruptcy Rule 4001-2(c),
the Debtors request that the Court set a date for the final hearing that is as soon as practicable,
and fix the time and date prior to the Final Hearing for parties to file objections to this Motion.
Waiver of Bankruptcy Rules 6004(a) and 6004(h)
89. To implement the foregoing successfully, the Debtors seek a waiver of the notice
requirements under Bankruptcy Rule 6004(a) and the 14-day stay of an order authorizing the use,
sale, or lease of property under Bankruptcy Rule 6004(h).
Notice
90. The Debtors shall provide notice of this Motion on the date hereof via facsimile,
overnight delivery, and/or hand delivery to: (a) the Office of the U.S. Trustee for the District of
Delaware; (b) the entities listed on the Consolidated List of Creditors Holding the 50 Largest
Unsecured Claims filed pursuant to Bankruptcy Rule 1007(d); (c) Citibank, N.A., in its capacity
as administrative agent under the TCEH first lien credit agreement and collateral agent under the
TCEH intercreditor agreements and counsel thereto; (d) Bank of New York Mellon Trust
51

Company, N.A., in its capacity as indenture trustee under: (i) the TCEH unsecured pollution
control revenue bonds; and (ii) the EFCH 2037 Notes due 2037, and counsel thereto;
(e) American Stock Transfer & Trust Company, LLC, in its capacity as indenture trustee under:
(i) the 9.75% EFH senior unsecured notes due 2019; (ii) the 10.0% EFH senior unsecured notes
due 2020; (iii) the 10.875% EFH LBO senior unsecured notes due 2017; (iv) the 11.25%/12.0%
EFH LBO toggle notes due 2017; (v) the 5.55% EFH legacy notes (series P) due 2014; (vi) the
6.50% EFH legacy notes (series Q) due 2024; and (vii) the 6.55% EFH legacy notes (series R)
due 2034, and counsel thereto; (f) Computershare Trust Company, N.A. and Computershare
Trust Company of Canada, in their capacities as indenture trustee under: (i) the 11.0% EFIH
senior secured second lien notes due 2021; and (ii) the 11.75% EFIH senior secured second lien
notes due 2022, and counsel thereto; (g) UMB Bank, N.A. in its capacity as indenture trustee
under: (i) the 9.75% EFIH senior unsecured notes due 2019; and (ii) the 11.25%/12.25% EFIH
senior toggle notes due 2018, and counsel thereto; (h) BOKF, NA, dba Bank of Arizona, in its
capacity as indenture trustee under 11.50% TCEH senior secured notes due 2020, and counsel
thereto; (i) CSC Trust Company of Delaware in its capacity as indenture trustee under: (i) the
6.875% EFIH senior secured notes due 2017; and (ii) the 10.0% EFIH senior secured notes due
2020, and counsel thereto; (j) Law Debenture Trust Company of New York in its capacity as
indenture trustee under: (i) the 10.25% TCEH senior unsecured notes due 2015; and (ii) the
10.50%/11.25% TCEH senior toggle notes due 2016, and counsel thereto; (k) Wilmington
Savings Fund Society, FSB in its capacity as indenture trustee under the 15.0% TCEH senior
secured second lien notes due 2021, and counsel thereto; (l) counsel to certain holders of claims
against the Debtors regarding each of the foregoing described in clauses (c) through (k); (m) the
agent for the TCEH debtor-in-possession financing facility and counsel thereto; (n) the agent for
52

the EFIH debtor-in-possession financing facility and counsel thereto; (o) counsel to certain
holders of equity in Texas Energy Future Holdings Limited Partnership; (p) counsel to Oncor;
(q) the SEC; (r) the Internal Revenue Service; (s) the Office of the United States Attorney for the
District of Delaware; (t) the Office of the Texas Attorney General on behalf of the PUC;
(u) counsel to ERCOT; (v) and Texas Transmission Investment LLC As this Motion is seeking
first day relief, within forty eight hours of the entry of an order respecting this Motion, the
EFIH Debtors will serve copies of this Motion and the order respecting this Motion as required
by Local Bankruptcy Rule 9013-1(m). The EFIH Debtors submits that, in light of the nature of
the relief requested, no other or further notice need be given.
No Prior Request
91. No prior request for the relief sought in this Motion has been made to this or any
other court.

)
In re: ) Chapter 11
)
1
) Case No. 14-_______ (___)
)
)
DECLARATION OF PAUL KEGLEVIC, EXECUTIVE VICE PRESIDENT, CHIEF
FINANCIAL OFFICER, AND CO-CHIEF RESTRUCTURING OFFICER OF ENERGY
FUTURE HOLDINGS CORP., ET AL., IN SUPPORT OF FIRST DAY MOTIONS

1

i

TABLE OF CONTENTS
Page
Part I. EFHs Business Operations and Capital Structure ......................................................10
A. Overview of EFHs Corporate Structure. ..............................................................10
B. EFHs Business Operations ...................................................................................12
1. TCEH .........................................................................................................12
2. EFH Corp. and Certain EFH Corp. Subsidiaries .......................................22
3. EFIH ...........................................................................................................26
4. Oncor..........................................................................................................26
5. EFHs Regulatory Environment ................................................................28
C. EFHs Capital Structure. ........................................................................................30
1. TCEH Debtors ...........................................................................................30
2. EFH Corp. and EFIH .................................................................................37
3. Oncor..........................................................................................................43
Part II. The Events Leading to the Chapter 11 Cases ..............................................................44
A. History of EFH Corp ..............................................................................................44
B. The 2007 Acquisition .............................................................................................45
C. EFH Following the 2007 Acquisition ....................................................................46
1. Luminant Remains a Market Leader in All Aspects of Electricity
Generation and Wholesale Operations .......................................................48
2. TXU Energy Remains a Market-Leading REP ..........................................50
3. Other Initiatives .........................................................................................52
D. The Result of Low Natural Gas Prices on EFHs Financial Performance
Following the 2007 Acquisition.............................................................................52
1. The Texas Electricity Market and the Role of ERCOT .............................53
2. The Precipitous Drop in Natural Gas Prices Resulting From the
Development of Unconventional Natural Gas ...........................................58
3. The Effect of Low Natural Gas Prices on EFH .........................................61
E. Other Market Conditions Affecting TCEHs Performance ...................................64
F. EFHs Financial Outlook and Business Strategy Going Forward .........................66
G. EFHs Reorganization Efforts ................................................................................67
1. EFH Implements Financial Transactions ...................................................67
2. Restructuring Negotiations ........................................................................70
3. The Restructuring Support Agreement ......................................................75
4. The Debtors Commence the Chapter 11 Cases..........................................80
Part III. Overview of First Day Relief .......................................................................................81

EXHIBITS

EXHIBIT A Evidentiary Support for First Day Motions

EXHIBIT B List of the Debtors

EXHIBIT C Corporate Structure

EXHIBIT D Restructuring Support Agreement


Pursuant to 28 U.S.C. 1746, I, Paul Keglevic, hereby declare as follows under penalty
of perjury:
1. I am the Executive Vice President, Chief Financial Officer, and Co-Chief
Restructuring Officer of Energy Future Holdings Corp. (EFH Corp.) a corporation organized
under the laws of the state of Texas; its direct subsidiary, Energy Future Competitive Holdings
Company LLC (EFCH), a limited liability company organized under the laws of the state of
Delaware; EFCHs direct subsidiary, Texas Competitive Electric Holdings Company LLC
(TCEH LLC and, together with EFCH and TCEH LLCs direct and indirect subsidiaries,
TCEH, and the entities composing TCEH that are debtors in these chapter 11 cases, the
TCEH Debtors), a limited liability company organized under the laws of the state of Delaware;
and EFH Corp.s direct subsidiary, Energy Future Intermediate Holding Company LLC
(EFIH), a limited liability company organized under the laws of the state of Delaware. EFH
Corp., various other direct and indirect subsidiaries of EFH Corp. that are debtors in these
chapter 11 cases, the TCEH Debtors, and EFIH are collectively referred to as the Debtors in
this declaration (this First Day Declaration) and are listed on Exhibit B hereto.
1

2. I have worked for the Debtors since 2008. I am generally familiar with the
Debtors businesses, day-to-day operations, financial matters, results of operations, cash flows,
and underlying books and records. Except as otherwise indicated in this First Day Declaration,
all facts set forth in this declaration are based upon my personal knowledge of the Debtors

1
EFH Corp., through EFCH and TCEH LLC, indirectly owns 100% of each of the entities composing Luminant
(as defined herein) and TXU Energy (as defined herein), along with EFHs other retail electricity sales
operations, with the exception of two joint venture entities with relatively small amounts of assets. Each of
TCEH LLCs direct and indirect subsidiaries, other than Greenway Development Holding Company LLC,
Collin G/G&B LLC, Nuclear Energy Future Holdings LLC, Nuclear Energy Future Holdings II LLC, and
Comanche Peak Nuclear Power Company LLC, are TCEH Debtors. EFIH owns 100% of Oncor Electric
Delivery Holdings Company LLC (Oncor Holdings), which owns approximately 80% of Oncor Electric
Delivery Company LLC (Oncor).

2

businesses, operations, and related financial information gathered from my review of their books
and records, relevant documents, and information supplied to me by members of the Debtors
management team and advisors. I am over the age of 18 and authorized by the Debtors Boards
of Directors and Managers (as applicable) to submit this declaration on behalf of the Debtors. If
called upon to testify, I could and would testify competently to the facts set forth in this First
Day Declaration.
3. The Debtors have requested a variety of relief in first day motions and
applications (the First Day Motions), filed concurrently herewith, to ensure a smooth transition
into chapter 11. I am generally familiar with the contents of each of the First Day Motions, and I
believe that the relief sought therein, including the ability to make certain essential payments and
otherwise continue their business operations, is necessary to permit continued efficient
operations of the Debtors businesses and an effective transition into chapter 11.
4. In my opinion, approval of the relief requested in the First Day Motions will
minimize disruption to the Debtors business operations, thereby preserving and maximizing the
value of the Debtors estates and assisting the Debtors in achieving a successful reorganization.
A complete description of the relief requested under the Debtors First Day Motions, and
evidentiary support therefore, is attached to this First Day Declaration as Exhibit A and
incorporated into this First Day Declaration by reference.
5. To familiarize the Court with the Debtors and the relief they are seeking on the
first day of these chapter 11 cases, this First Day Declaration begins with a Preliminary
Statement, which provides an overview of the Debtors and their non-Debtor affiliates
(collectively, EFH), the facts and circumstances surrounding these chapter 11 cases, and the
Debtors anticipated restructuring. This First Day Declaration is then organized as follows:

3

Part I describes EFHs business operations and capital structure;
Part II describes the events that led to the commencement of these chapter 11 cases,
including a significant decline in wholesale electricity prices that frustrated the
investment thesis of a transaction that took EFH private in 2007, the Debtors efforts
to address the challenging environment of low wholesale electricity prices and the
Debtors resulting balance sheet difficulties, the Debtors negotiations regarding a
consensual restructuring with their key stakeholders, the restructuring support
agreement (the Restructuring Support Agreement), attached hereto as Exhibit D,
and the anticipated events in these chapter 11 cases; and
Part III provides an overview of the relief requested in the First Day Motions.
Preliminary Statement
6. EFHs businesses include the largest generator, distributor, and certified retail
provider of electricity (or REP) in Texas.
2
EFH conducts substantially all of its business
operations in the electricity market overseen by the Electric Reliability Council of Texas
(ERCOT), which covers the majority of Texas. The Texas electricity market, in turn, is
subject to oversight and regulation by the Public Utility Commission of Texas (the PUC).
EFH has approximately 9,100 employees, approximately 5,700 of whom are employed by the
Debtors, in three distinct business units:
EFHs competitive electricity generation, mining, wholesale electricity sales, and
commodity risk management and trading activities, conducted by the TCEH Debtors
composing Luminant;
EFHs competitive retail electricity sales operations and related operations, mainly
conducted by the TCEH Debtors composing TXU Energy;
3
and

2
For financial reporting under Generally Accepted Accounting Principles, EFH Corp. reports information for
two segments: the Competitive Electric and Regulated Delivery business segments. The Competitive Electric
segment includes both Luminant and TXU Energy in consideration of the highly integrated nature of the
competitive business, as evidenced by the centralized management of commodity risk across the business and
Luminants sourcing of all TXU Energys electricity needs. The Regulated Delivery segment is composed of
Oncor. The Competitive Electric segment is essentially engaged in the production of electricity and the sale of
electricity in wholesale and retail channels.
3
The Debtors also conduct a relatively small amount of retail electricity operations through their 4Change brand
and another entity, Luminant ET Services Company, that provides retail electricity service to one municipality
and to some of Luminants mining operations, and a small amount of retail gas operations through Luminant
Energy Company LLC.

4

EFHs rate-regulated electricity transmission and distribution operations,
conducted by the non-Debtor Oncor. EFIH indirectly owns approximately 80% of
Oncor.
EFH and its management team have significant experience as leaders in the electricity
industry.
7. Luminant owns and operates fourteen power plants comprising 40 generation
units. Of those units, 33 units are in active year-round operation, three units (at two plants) are
subject to seasonal operation, and four units (at two plants) are idled. Luminants total
nameplate electricity generation capacity
4
of 15,427 megawatts (MW) accounts for
approximately 18% of the generation capacity for the ERCOT market. Luminant sells
approximately 50% of its electricity generation output to TXU Energy, and sells the remainder
through bi-lateral sales to third parties or through sales directly to ERCOT. Luminant also owns
and operates 12 surface lignite coal mines in Texas that supply coal to Luminants
lignite/coal-fueled units.
5
Luminant is the largest coal miner in Texas and the seventh-largest
coal miner in the United States.
6
Luminants generation units and mines are high-performing
and have impressive safety records. Moreover, Luminants commodity trading and risk
management activities have also delivered significant value to the Debtors.
8. TXU Energy sells electricity to approximately 1.7 million residential and business
customers, and is the single largest REP by customer count in Texas. TXU Energy serves
approximately 26% of the residential customers and approximately 19% of the business
customers in the areas of the ERCOT market that are open to competition. TXU Energy

4
Nameplate capacity is an industry-standard term for the original design capacity of an electricity generation
unit.
5
Of these mines, eight are active, three are in development, and one is currently idle.
6
Based on tons of coal mined in 2012.

5

purchases all of its electricity requirements from Luminant. TXU Energy maintains a strong
position in the highly competitive ERCOT retail electricity market based on industry-leading
customer care performance and technological innovation and has maintained strong performance
notwithstanding intense competition.
9. Oncor is engaged in rate-regulated electricity transmission and distribution
activities in Texas. Oncor provides these services, at rates approved by the PUC, to REPs
(including TXU Energy) that sell electricity to residential and business customers, as well as to
electricity distribution companies, cooperatives, and municipalities. Oncor operates the largest
transmission and distribution system in Texas, delivering electricity to more than 3.2 million
homes and businesses and operating more than 120,000 miles of transmission and distribution
lines. Oncor has the largest geographic service territory of any transmission and distribution
utility within the ERCOT market, covering 91 counties and over 400 incorporated municipalities.
Importantly, however, Oncor is ring-fenced from the Debtors: it has an independent board of
directors, and it is operated, financed, and managed independently. As a result, it is not
consolidated into EFH Corp.s financial statements. A significant portion of Oncors revenues
are attributable to TXU Energy, which is Oncors largest customer. Oncor Holdings, Oncor, and
their ring-fenced affiliates and subsidiaries are not Debtors in these chapter 11 cases.
10. EFH largely adopted its current organizational structure, and issued a significant
portion of the debt that composes its capital structure, in October 2007 as a result of the largest
private acquisition of a public company in history (the 2007 Acquisition). At the time, EFHs
current equity owners, including affiliates of Goldman Sachs, KKR and TPG (the EFH Equity
Owners) (together with certain co-investors) contributed approximately $8.3 billion of equity
capital into EFH. And, like many other private acquisitions, EFH issued significant new debt

6

and assumed existing debt and liabilities in connection with the 2007 Acquisition. Immediately
following the 2007 Acquisition, the Debtors total funded indebtedness
7
was approximately
$36.13 billion, comprised of approximately $28.8 billion at TCEH, $128 million at EFCH, and
$7.2 billion at EFH Corp. Today, the Debtors total funded indebtedness is nearly $42 billion,
including:
approximately $24.385 billion of first lien claims (excluding certain first lien hedging
obligations), $1.571 billion of second lien claims, and $6.112 billion of unsecured
claims against the TCEH Debtors;
approximately $9 million of unsecured claims, and $61 million of claims secured by
assets owned by other entities, against EFCH;
approximately $1.929 billion of unsecured claims against EFH Corp.; and
approximately $3.985 billion of first lien claims, $2.156 billion second lien claims,
and $1.568 billion of unsecured claims against EFIH.
11. Although the Debtors operations are strong and TCEH and EFIH have
historically been and will continue to be cash flow positive before debt service, low wholesale
electricity prices in the Texas electricity market since mid-2008 have made it impossible for the
TCEH Debtors to support their current debt load. In October 2007, the main ingredients for
EFHs financial success were robust and steady economic growth and high wholesale electricity
prices driven by high natural gas prices that were not expected to significantly decline over the
long term. Since 2007, however, overall economic growth was reduced because of the recession
in 2008 and 2009 and wholesale electricity prices have significantly declined. The material
reduction in wholesale electricity prices was caused, in large part, by an increase in the supply of
natural gas caused by the rise of hydraulic fracturing (known as fracking). This increase in the

7
References to funded indebtedness in this First Day Declaration include intercompany debt holdings and
short-term borrowings, and exclude guarantees, unamortized discounts or premiums, accrued but unpaid
interest, and certain other figures typically reported in the Debtors filings with the Securities and Exchange
Commission (the SEC), such as capital lease obligations, certain promissory notes, and certain other
obligations.

7

supply of natural gas caused a significant decline in natural gas prices, and because the wholesale
price of electricity in the ERCOT market is closely tied to the price of natural gas, the wholesale
price of electricity in the ERCOT market has significantly declined. As a result of those
decreases, the profitability of the TCEH Debtors generation assets has substantially declined.
12. Separately, EFIH and EFH Corp. have significant funded indebtedness and
insufficient cash flows to service those obligations. Before the Petition Date, EFIHwhich has
no independent business operationsrelied on dividend distributions from Oncor and
intercompany interest payments (relating to debt issued by EFH Corp. and the TCEH Debtors
that EFIH acquired in exchange offers) to satisfy its funded debt obligations. These sources of
cash, however, were not sufficient to service EFIHs obligations. Similarly, EFH Corp. also has
minimal cash flow. As a result, both EFIH and EFH Corp. faced significant liquidity constraints
that prompted a chapter 11 filing.
13. Accordingly, despite consistent top-tier operational performance in the Debtors
business units, industry-leading customer care, successful hedging operations, efficiencies
generated by the Debtors shared services framework, a consistent stream of dividend
distributions to EFIH resulting from its indirect ownership of Oncor, numerous efforts to reduce
and extend their funded debt and other obligations, and the fact that EFIH and TCEH are cash
flow positive before debt service, the Debtors are significantly overleveraged.
14. To address these issues, the Debtors retained restructuring professionals and
commenced restructuring discussions in July 2012. These discussions accelerated in early 2013,
when the Debtors began the process of organizing the various creditor and equity groups and
encouraging them to retain professionals. Soon thereafter, the Debtors began substantive
negotiations with these constituents and their advisors. These negotiations lasted for over a year

8

and included countless meetings among professionals and principals. In April 2013 and October
2014, the Debtors issued comprehensive cleansing disclosures through filings with the SEC, and
the Debtors periodically made other disclosures regarding the ongoing negotiations.
15. Two key issues drove negotiations. First, the tax consequences of certain
restructuring outcomes have created a challenging negotiating dynamic. Certain restructuring
scenarios, such as a sale of the Debtors assets under a plan or under section 363 of the
Bankruptcy Code, would trigger in excess of $6 billion of aggregate tax liability.
8
The Debtors
and certain of their stakeholders have diverging views on whether the TCEH Debtors, EFIH,
and/or EFH Corp. would be liable for those tax liabilities. Restructuring negotiations have,
therefore, focused on attempting to restructure the Debtors in a tax-efficient manner through
either a consolidated restructuring or a tax free spin of TCEH and/or EFIH.
16. Second, the respective valuation of Oncor, on one hand, and TCEH, on the other
hand, has been subject to dispute. Generally speaking, the recoveries of holders of claims
against and interests in the TCEH Debtors will be determined by the value of the TCEH Debtors
assets. Similarly, the recoveries of holders of claims against and interests in EFIH will be
determined by the value of EFIHs 80% ownership of Oncor. And the recoveries of holders of
claims against and interests in EFH Corp. will be determined by the value of EFH Corp.s assets,
including any value allocated on account of EFH Corp.s ownership of EFIH and TCEH and the
value, if any, of EFH Corp.s direct and indirect subsidiaries other than EFIH and TCEH.
Differing views on the valuation of Oncor, on one hand, and TCEH, on the other hand,
dominated negotiations of a consolidated restructuring scenario that involved various creditor

8
The actual amount of any tax would depend on, among other things, final sale prices of the assets. The
$6 billion figure reflects the Debtors view of the potential taxable gain that would arise based on the tax basis
and the fair market value of TCEHs assets and EFIHs interests in Oncor.

9

constituencies receiving equity in EFH Corp. Additionally, even in the context of a tax-free
spin, certain of TCEHs stakeholders have insisted that the stakeholders of EFH Corp. and EFIH
should compensate TCEHs stakeholders for forgoing the value associated with a step-up in
tax basis and the subsequent tax benefits of depreciation deductions.
17. In the final weeks leading to the Debtors chapter 11 cases, several of the
Debtors stakeholders coalesced around a global restructuring of the Debtors (the Global
Restructuring), premised on a tax-free spin of TCEH (the TCEH Tax-Free Spin) that will
deconsolidate TCEH from EFH, a simultaneous deleveraging of EFIH thorough a $2 billion
investment (with that investment to be converted into equity of EFH Corp. upon emergence from
chapter 11) (the Investment Commitment), and a framework for settling so-called
makewhole claims against the EFIH Debtors (such claims, the EFIH Makewhole Claims,
and such settlements, the EFIH Makewhole Settlements). The material terms of the Global
Restructuring are memorialized in the Restructuring Support Agreement that the Debtors and
certain of their key stakeholders executed just before filing for chapter 11.
9

18. The Restructuring Support Agreement is an important first step toward a
consensual and timely chapter 11 reorganization that avoids the spectre of in excess of $6 billion
of deconsolidation-related tax liabilities. To be sure, the Debtors still face a number of hurdles,
including the need to obtain a private letter ruling from the IRS blessing the TCEH Tax-Free
Spin and resolve the EFIH Makewhole Claims of holdout secured creditors. The Debtors
nevertheless believe that the Global Restructuring represents the best opportunity to conclude
their chapter 11 cases in a swift and tax-efficient manner that will maximize the value of their
estates. Accordingly, during the course of these chapter 11 cases, the Debtors expect to finalize

9
The Debtors will seek authority to assume the Restructuring Support Agreement pursuant to a separate motion
(the RSA Assumption Motion), which will be filed on or shortly following the Petition Date.

10

the work that must be done to implement the Global Restructuring, while continuing to focus on
Job 1: operating one of the largest, most complex energy companies in the country in a way
that maximizes value for all of their stakeholders, protects jobs, complies with their regulatory
obligations, and ensures the smooth and reliable generation, sale, and delivery of electricity to
EFHs customers.
Part I.
EFHs Business Operations and Capital Structure
A. Overview of EFHs Corporate Structure.
19. EFH Corp. is the parent company of each of the entities that compose EFH,
including: (a) the entities composing TCEH (including TCEH LLCs parent company, EFCH);
(b) EFIH; (c) non-Debtor Oncor Holdings, which is 100% owned by EFIH, Oncor, which is
approximately 80% owned by Oncor Holdings, and certain subsidiaries and affiliates of Oncor
Holdings and Oncor;
10
and (d) certain of EFH Corp.s other direct and indirect Debtor and
non-Debtor subsidiaries that are discussed below.
20. The following chart is a simplified representation of EFHs corporate structure:
11

10
Texas Transmission Investment LLC is an unaffiliated entity that owns approximately 19.75% of Oncor. It is
owned by an investment group led by OMERS Administrative Corporation, acting through its infrastructure
investment entity, Borealis Infrastructure Management Inc., and the Government of Singapore Investment
Corporation, acting through its private equity and infrastructure arm, GIC Special Investments Pte. Ltd. The
remaining ownership interests in Oncor are indirectly held by members of Oncors management.
11
Exhibit B contains a full list of the TCEH Debtors and other Debtors. Exhibit C contains a full corporate
structure chart of EFH.

11

21. As of December 31, 2013, EFH Corp. reported total assets of approximately
$36.4 billion in book value, approximately $28.8 billion of which is attributable to TCEH, and
total liabilities of approximately $49.7 billion in book value, approximately $41.1 billion of
which is attributable to TCEH.
12
EFH Corp.s assets and liabilities that are not attributable to
TCEH are mostly attributable to EFIHs indirect ownership of approximately 80% of Oncor.
EFH Corp.s consolidated revenues for the quarter ending December 31, 2013 were
approximately $1.3 billion, all of which were attributable to TCEH. EFH Corp.s consolidated
annual revenues for the year ending December 31, 2013 were approximately $5.9 billion.
13

12
Figures for TCEH are derived from EFCHs public filings with the SEC, and are almost entirely attributable to
TCEH LLC and its Debtor and non-Debtor subsidiaries.
13
Oncors revenues are not included in EFH Corp.s consolidated revenues because EFH Corp. accounts for its
ownership of Oncor under the equity method of accounting.
EFH Corp.

EFIH EFCH
TCEH LLC
Luminant

TXU
Energy

Oncor

~80 0%
100% 100%
100%
100% 100%
Ring-fenced
Other Direct
and Indirect
Subsidiaries
of EFH Corp.
Oncor
Holdings
100%

12

B. EFHs Business Operations.
1. TCEH.
22. TCEH is composed of: (a) the TCEH Debtors, including TCEH LLC;
TCEH LLCs direct parent company, EFCH; and most of the entities that compose TCEH,
including the entities that compose Luminants electricity generation, mining, commodity risk
management and trading activities, and wholesale operations, TXU Energy and the other entities
that compose the Debtors retail operations, and TCEH Finance, Inc. (TCEH Finance); and
(b) certain other entities that are not obligated on the TCEH Debtors funded indebtedness.
14

TCEHs business operations also depend on certain services that are provided by EFH Corporate
Services Company (EFH Corporate Services), a subsidiary of EFH Corp., which acts as a
shared services center for Luminant and TXU Energy. These operations are discussed in more
detail below.
a. Luminant.
i. Overview.
23. Luminant is the largest electricity generator and lignite coal miner in Texas.
Luminant also operates a wholesale electricity sales, commodity risk management and trading
activities organization. Luminant employs approximately 4,200 individuals.
24. The map below depicts the location of Luminants power plants and associated
lignite mines in Texas.

14
Specifically, these entities are (a) non-Debtor Greenway Development Holding Company LLC, which is the
managing partner of non-Debtor joint venture Collin G/G&B LLC; (b) non-Debtors Nuclear Energy Future
Holdings LLC and Nuclear Energy Future Holdings II LLC, which indirectly or indirectly own approximately
88% of non-Debtor Comanche Peak Nuclear Power Company LLC; and (c) Debtor TXU Receivables Company
LLC, an entity associated with a terminated accounts receivable program.

13

ii. Generation Activities.
25. Luminants total nameplate generation capacity of 15,427 MW, composed of
nuclear, lignite/coal, and natural gas-fueled units, accounts for approximately 18% of the
ERCOT markets nameplate generation capacity. Luminants generation capacity can be
categorized as:
Year-round or full operations: approximately 11,892 MW (33 units) of lignite/coal,
nuclear, and gas-fueled units;
Seasonal operations: approximately 1,880 MW (3 units) of lignite/coal-fueled units
that Luminant has previously sought, and received, permission to operate only during
high-demand periods (e.g., during the peak demand of summer); and
Idled: approximately 1,655 MW (4 units) of natural gas-fueled units which could be
restarted with approximately 90-days notice and significant investment.

14

26. In 2013, Luminant generated approximately 73,409 gigawatt hours (GWh),
compared to the ERCOT markets total electricity consumption of approximately 331,000 GWh.
As demonstrated by the chart below, Luminant is the 13th largest generator of electricity in the
United States:

(A) Nuclear Generation.
27. Luminants nuclear generation operations consist of two units at its Comanche
Peak location, with total nameplate capacity of 2,300 MW. The units generally run at full
capacity except during nuclear fuel assembly replacement outages scheduled approximately
every 18 months. Comanche Peak units 1 and 2 began commercial operation in 1990 and 1993,
respectively; each unit has a permit allowing for 40 years of operations, and Luminant
anticipates that it will obtain a permit to extend operation of the units for an additional 20 years.
The Comanche Peak units operated at approximately 101.7%, 98.5%, 95.7%, and 100% of
nameplate generation capacity in 2013, 2012, 2011, and 2010, respectively, and are consistently
ranked in the top decile of nuclear plants in the U.S. for production reliability and cost

15

performance. Additionally, Comanche Peak has consistently demonstrated high performance as
evaluated across the industry by the Institute of Nuclear Power Operations. Nuclear-fueled
generation accounted for 15% of Luminants nameplate capacity and 28% of Luminants
electricity generation in 2013.
(B) Lignite/Coal-Fueled Generation.
28. Luminants lignite/coal-fueled generation operations include twelve units at five
plant sites, with total nameplate capacity of 8,017 MW. These include:
two units at Big Brown with total nameplate capacity of 1,150 MW;
three units at Monticello with total nameplate capacity of 1,880 MW;
three units at Martin Lake with total nameplate capacity of 2,250 MW;
two units at Oak Grove with total nameplate capacity of 1,600 MW; and
two units at Sandow with total nameplate capacity of 1,137 MW.
29. Luminants lignite/coal units are generally available for full operations throughout
the year except when they are out of service for either a scheduled or unscheduled maintenance
outage. As discussed in more detail below, however, in recent years Luminant has reduced
electricity generation from selected lignite/coal units during times when the demand for
electricity and wholesale electricity prices in the ERCOT market are comparatively low. These
reductions are achieved in one of two forms: either through short-term (e.g., overnight)
reductions in response to wholesale electricity prices, or through longer-term seasonal shutdowns
in response to sustained periods of relatively low wholesale electricity prices and demand for
electricity. Indeed, two units at Monticello and one unit at Martin Lake have, in the recent past,
been subject to seasonal operations.
30. Luminants lignite/coal-fueled units operated at 74.1%, 70.0%, 83.5%, and 82.2%
of nameplate generation capacity for the years 2013, 2012, 2011, and 2010, respectively. In

16

2011 and 2010, the units performed at the top decile for U.S. coal-fueled generation facilities.
Reduced generation in 2012 and 2013 was largely due to low wholesale electricity prices in the
ERCOT market. Coal/lignite-fueled generation accounted for 52% of Luminants nameplate
capacity and 71% of Luminants electricity generation in 2013.
(C) Natural Gas-Fueled Generation.
31. Luminants natural gas-fueled generation operations consist of 26 units at eight
plant sites with 5,110 MW of total nameplate capacity and 3,455 MW of available capacity,
including:
two steam units at Graham with total nameplate capacity of 630 MW;
two steam units at Lake Hubbard with total nameplate capacity of 921 MW;
two steam units at Stryker Creek with total nameplate capacity of 685 MW;
one steam unit at Trinidad with total nameplate capacity of 244 MW;
four combustion turbines at DeCordova with total nameplate capacity of 260 MW;
six combustion turbines at Morgan Creek with total nameplate capacity of 390 MW;
five combustion turbines at Permian Basin with total nameplate capacity of 325 MW;
three inactive steam units at Valley with total nameplate capacity of 1,115 MW; and
one inactive steam unit at Permian Basin with total nameplate capacity of 540 MW.
32. Luminants natural gas-fueled units are primarily used when electricity demand is
highest (i.e., they are considered peaking units because they are generally used during peak
demand periods) or to support system reliability at times of low reserve margins (i.e., times
when the systems overall generation capacity needs to be increased to maintain a certain target
cushion over expected demand for electricity). Inactive units may be restarted in advance of
anticipated electricity needs under proper economic conditions, but would likely require several
months and incremental capital expenditures to restore them to full operational readiness.

17

Natural gas-fueled generation accounted for approximately 33% of Luminants nameplate
capacity and 1% of Luminants electricity generation in 2013.
33. Luminant also manages approximately 10.5 billion cubic feet of natural gas
storage capacity, primarily to assist in fueling its natural gas-fueled units, and engages in various
activities related to natural gas including direct purchases, transportation agreements, storage
leases, and commercial retail sales.
34. Luminant has filed permit applications with, and received approval from, the
Texas Commission on Environmental Quality (the TCEQ) to build two new natural gas
combustion turbines totaling approximately 420460 MW at its existing DeCordova plant site
and two new natural gas combustion turbines totaling approximately 420460 MW at its existing
Tradinghouse plant site. Luminant has also filed air permit applications with the TCEQ to build
a combined-cycle natural gas turbine generation unit totaling approximately 730810 MW at its
existing Eagle Mountain plant site and two natural gas combustion turbines totaling
approximately 420460 MW at its existing Lake Creek plant site. Luminant believes current
market conditions, primarily driven by low wholesale electricity prices, do not provide adequate
economic returns to warrant new construction. The permits that have been granted, and the
permits in the application process, if granted, could allow Luminant to capitalize on
opportunities for expansion when they are economically attractive in the future (assuming the
TCEH Debtors balance sheet has been addressed or the TCEH Debtors otherwise have access to
sufficient capital to make these investments).
iii. Mining Operations.
35. Luminant currently owns twelve surface lignite coal mines in Texas, eight of
which are in active operation. Luminant is the largest coal miner in Texas and the
seventh-largest coal miner in the United States. Luminants mining activity supports generation

18

at its lignite/coal units; Luminant mined approximately 29 million tons of lignite in 2013, and
approximately 68% of the fuel used at Luminants lignite/coal-fueled units in 2013 was supplied
from surface-minable lignite reserves located adjacent to Luminants plants.
36. As of December 31, 2013, Luminant owns or has under lease an estimated 715
million tons of lignite reserves supporting plant sites, including an undivided interest in
approximately 175 million tons of lignite reserves that provide fuel for the Sandow facility, and
also owns or has under lease approximately 85 million tons of reserves not currently dedicated to
existing plant sites. Luminant meets its fuel requirements at its Big Brown, Monticello, and
Martin Lake plants by blending lignite with coal purchased from third-party suppliers in the
Powder River Basin in Wyoming. The coal is transported from the Powder River Basin to
Luminants plants by railcar pursuant to various contracts.
37. Luminant Mining Company LLC (Luminant Mining), a Debtor entity, holds all
of Luminants mining permits and contracts with several of the TCEH Debtors to conduct
Luminants mining operations. Luminant Mining is subject to regulatory oversight by the
Railroad Commission of Texas (the RCT), which regulates, among other things, mining
permits and land reclamation requirements related to mining sites. As part of the land
reclamation requirements, Luminant Mining is required to satisfy certain bonding requirements.
Before the Petition Date, Luminant Mining self-bonded these obligations with the support of a
guarantee from another Debtor entity, Luminant Generation Company LLC. Following the
Petition Date, Luminant Mining expects to satisfy the bonding requirement through either (a) the
grant of a super-priority carve-out from the super-priority liens under the TCEH Debtors
proposed debtor in possession financing facility (the TCEH DIP Facility) that will enable the
RCT to be paid on account of reclamation obligations before the TCEH DIP Facility lenders and

19

the TCEH Debtors secured creditors;
15
or (b) if negotiations are not successful with respect to
the carve-out, the delivery of one or more cash collateralized letters of credit. in an amount of
up to $1.1 billion, issued under the TCEH DIP Facility.
iv. Wholesale Electricity Sales, Commodity Risk
Management, and Trading Activities.
38. Luminants generation units provide electricity for its wholesale electricity sales,
commodity risk management, and trading operations, through which Luminant supplies TXU
Energy and other third-party wholesale and retail counterparties with electricity and
electricity-related services. Luminant enters into both short-term and long-term electricity
contracts, enabling it to manage variations in electricity generation, price risk associated with
generation output and changing consumer demand, as well as to meet the needs of large
wholesale customers. Luminant also purchases electricity, including electricity generated from
renewable energy resources such as wind, from third-parties. Additionally, Luminant manages
physical fuel purchase agreements and financial hedges with a variety of counterparties to
manage key commodity costs and delivery risks that affect Luminants electricity generation and
mining operations.
39. Wholesale electricity prices in the ERCOT market vary and are based on
electricity supply and demand, fuel prices, variable costs for electricity generation assets, and
other market factors. As discussed in greater detail below, wholesale electricity prices in the
ERCOT market are closely tied to the price of natural gas. Additionally, weather can
significantly influence short-term wholesale electricity prices, particularly where there are

15
These options are discussed in greater detail in the Motion of Energy Future Holdings Corp., et al., for Entry of
Interim and Final Orders (A) Approving Postpetition Financing, (B) Granting Liens and Providing
Superpriority Administrative Expense Claims, (C) Granting Adequate Protection, (D) Modifying the Automatic
Stay, and (e) Scheduling a Final Hearing (the TCEH DIP Motion), filed contemporaneously herewith.

20

weather extremes in Texas and throughout the country of the kind that occurred in the fall/winter
of 2013 and 2014 or the summer of 2011. Those weather extremes can cause increases in natural
gas prices or shortages in electricity generation capacity and increased demand for electricity.
Luminants wholesale operations manage these risks, and others, through optimizing the dispatch
of the electricity generation fleet, physical purchases and sales of electricity and fuel
commodities, as well as the use of financial and bilateral contracts and other hedging activities.
40. Luminants commodity risk management and trading activities hedge the volume
and price risk associated with Luminants generation fleet and TXU Energys retail needs.
These activities require significant collateral support and account for a significant portion of
funds the TCEH Debtors seek to borrow under the TCEH DIP Motion.
16

b. TXU Energy.
41. TXU Energy serves approximately 1.7 million residential and commercial retail
electricity consumers.
17
Approximately 69% of TXU Energys retail revenues in 2013
represented sales to residential customers, with the remaining amount attributable to commercial
and industrial business customers. TXU Energy has a very strong market position in the ERCOT
market, serving approximately 26% of the residential customers and 19% of the business
customers in the areas of ERCOT open to competition. Indeed, TXU Energy is the single largest
certificated REP by customer count in Texas. Luminant procures or supplies 100% of TXU

16
Luminants trading and hedging activities, and the required collateral support obligations, are discussed in more
detail in the Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders Authorizing
the Debtors to (A) Continue Performing Under Prepetition Hedging and Trading Arrangements, (B) Pledge
Collateral and Honor Obligations Thereunder, and (C) Enter Into and Perform Under Trading Continuation
Agreements and New Postpetition Hedging and Trading Arrangements (the Hedging and Trading Agreements
Motion), filed contemporaneously herewith.
17
Customer count measured by number of meters served.

21

Energys electricity requirements. TXU Energy employs approximately 1,000 individuals in its
marketing, customer operations, and support organizations.
42. Texas is one of the fastest growing states in the United States with a diverse
economy. As a result, competition for retail electricity customers is robust. The number of
certified REPs has grown from approximately 40 in 2002, the first year of retail electricity
competition in Texas, to over 140 today. Based on data published by the PUC, as of September
30, 2013, approximately 62% of residential customers and 69% of small commercial customers
in competitive areas of the ERCOT market are served by REPs that are not associated with the
incumbent REP that was the traditional provider in their service area before deregulation.
Moreover, approximately 89% of residential customers and 90% of small commercial load
customers have chosen an electricity provider at least once since the ERCOT retail market
deregulation process began in Texas in 2002,
18
making Texas the only state with retail
competition where more than half of residential customers have chosen to be served by
electricity providers other than the incumbent electric utilities. As a result, TXU Energy, like
other REPs formerly affiliated with the regulated, monopoly electricity utilities (such as EFHs
predecessor, TXU Corp.) that existed before deregulation of Texass electricity market in 2002,
has experienced customer attrition since the Texas electricity market was opened to competition.
Indeed, that significant level of competition is one of the reasons that TXU Energy believes it is
essential that it receive the authority to promptly assume its retail electricity contracts.
19

18
Electric Reliability Council of Texas, Inc., Supplemental Information Retail Electric Market (March 21, 2014).
19
The Debtors seek this authority pursuant to the Motion of Energy Future Holdings Corp., et al., for Entry of
(A) an Order Authorizing the Debtors to (I) Maintain and Administer Customer Programs, (II) Honor
Prepetition Obligations, (III) Pay Certain Expenses on Behalf of Certain Organizations, (IV) Fix Deadlines to
File Proofs of Claim for Certain Customer Claims, and (V) Establish Procedures for Notifying Customers of
Commencement of the Debtors Chapter 11 Cases, Assumption of Customer Agreements, and the Bar Dates for
Customer Claims and (B) an Order Authorizing Certain of the Debtors to Assume Customer Agreements
(the Customer Programs Motion), filed contemporaneously herewith.

22

Importantly, TXU Energys key customer metrics including bad debt, days sales outstanding,
and PUC complaints have significantly improved since the 2007 Acquisition, performing at or
better than industry-leading levels.
2. EFH Corp. and Certain EFH Corp. Subsidiaries.
43. In addition to EFCH, TCEH LLC and its subsidiaries, EFIH, Oncor Holdings,
Oncor, and Oncors affiliates and subsidiaries, EFH is composed of: (a) EFH Corp.; (b) EFH
Corporate Services; (c) EFH Properties Company; and (d) various other direct and indirect
subsidiaries of EFH Corp. that are legacy entities without active business operations. These
entities are discussed below.
a. EFH Corp.
44. EFH Corp. is the ultimate parent holding company of each of the entities
composing EFH. Its principal assets are its indirect approximately 80% ownership of Oncor
(through its direct ownership of EFIH) and its indirect ownership of the TCEH LLC and its
subsidiaries (through its direct ownership of EFCH). EFH Corp. also directly or indirectly owns
a number of other subsidiaries that are discussed below.
b. EFH Corporate Services.
45. EFH Corporate Services provides a host of vital shared services, primarily to
TCEH (i.e., Luminant and TXU Energy) and, to a lesser extent, EFH Corp., EFIH, and Oncor.
EFH Corporate Services employs approximately 450 individualsincluding the majority of the
Debtors senior executives. These shared services are integral to EFH Corp. and its subsidiaries
business operations, and also generate significant cost savings.
46. EFH Corporate Services provides the shared services to TCEH and EFIH under
separate shared services agreements (the Shared Services Agreements), and to EFH Corp. and
certain of EFH Corp.s other direct and indirect subsidiaries through a series of operating

23

procedures and the cash management system administrated by EFH Corporate Services.
20

Services are provided to Oncor based on historical practice. All shared services are billed at
cost. In 2014, shared services are expected to be allocated approximately 54% to Luminant, 30%
to TXU Energy, 13% to Oncor, 2% to EFIH, and 2% to EFH Corp.
21

47. The shared services include, among other things, certain:
legal functions;
human resources functions;
treasury functions;
enterprise and market risk management functions;
controller functions;
federal, state, and local tax services;
financial planning functions;
strategy and business development functions;
information technology and infrastructure services;
external affairs, including political and regulatory advocacy;
investor and media relations;
corporate secretarial, security, compliance, and ethics issues;
internal auditing and Sarbanes-Oxley compliance;
supply chain services;
business services administration; and

20
EFHs cash management system, the Shared Services Agreements, and intercompany payments in general are
discussed in more detail in the Motion of Energy Future Holdings Corp., et al., for Entry of an Order
(A) Authorizing the Debtors to (I) Continue Using their Existing Cash Management System, (II) Maintain
Existing Bank Accounts and Business Forms, and (III) Continue Using Certain Investment Accounts;
(B) Authorizing Continued Intercompany Transactions and Netting of Intercompany Claims; and (C) Granting
Postpetition Intercompany Claims Administrative Expense Priority (the Cash Management Motion), filed
contemporaneously herewith.
21
These figures exclude certain quarterly management fees payable to the EFH Equity Owners. The management
fees have not been paid since the fourth quarter of 2013.

24

facility design and construction and real estate management.
48. As described in the Cash Management Motion, the treasury function at EFH
Corporate Services provides certain cash management services to the Debtors (and certain of
their non-Debtor, non-Oncor affiliates). Specifically, EFH Corporate Services issues checks and
automated clearing house payments to third parties for goods and services received by the
Debtors (primarily by the TCEH Debtors). The applicable Debtors then reimburse EFH
Corporate Services for amounts paid.
i. Federal and State Income Tax Allocation (Tax Sharing)
Agreements Administered by EFH Corporate Services.
49. EFH Corp. files federal and state income tax returns that include the results of
EFCH, TCEH LLC and its subsidiaries, EFIH, and Oncor Holdings. EFH Corp. is a corporate
member of the consolidated group, while each of EFIH, Oncor Holdings, EFCH, and TCEH LLC
and a majority of its subsidiaries are classified as disregarded entities for federal income tax
purposes. Oncor is a partnership for income tax purposes and is not a corporate member of the
EFH Corp. consolidated group.
50. The tax obligations of the various entities composing EFH are guided by two tax
sharing agreements. Each entitys compliance with applicable tax requirements and the
applicable tax sharing agreement is overseen by EFH Corporate Services. During these chapter
11 cases, the Debtors will continue making certain payments under the tax sharing agreements to
the extent the bankruptcy court authorizes such payments.
22
Oncor will continue to make tax
payments in accordance with its tax sharing agreement (the Oncor TSA), which effectively

22
In particular, the Debtors are seeking to pay certain state law tax claims in the ordinary course pursuant to the
Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders Authorizing the Debtors
to Pay Certain Prepetition Taxes and Fees and Granting Related Relief (the Taxes Motion), and are seeking
the authority to continue appropriate intercompany transactions related to such state law tax claims pursuant to
the Cash Management Motion, each filed contemporaneously herewith.

25

requires Oncor to make payments approximately equal to payments it would make as a
stand-alone taxpayer. As of the Petition Date, Oncor makes those payments to EFH Corp. As
discussed in greater detail below, however, in connection with the Restructuring Support
Agreement, EFH Corp.s right to payment under the Oncor TSA will be assigned to EFIH.
c. EFH Properties Company.
51. Non-Debtor EFH Properties Company, a direct subsidiary of EFH Corp., is the
lessee of record with respect to certain of EFHs real property leases, including the lease of EFH
Corp.s headquarters, which houses approximately 370 EFH Corporate Services and EFH Corp.
employees and executives and approximately 435 of Luminants employees. Additionally, EFH
Properties Company administers certain subleases with respect to EFHs real property leases,
primarily with respect to the headquarters lease, and operates certain parking facilities.
d. Other Direct and Indirect Subsidiaries of EFH Corp.
52. EFH Corp. also is the parent of several entities with de minimis assets,
23
including
(i) three Debtor entities that once held international assets that have either been liquidated or are
currently in administration and/or liquidation cases initiated before the 2007 Acquisition;
(ii) Debtor entities associated with a natural gas distribution business that was sold in 2004, a
related non-Debtor captive insurance company, a related non-Debtor United Kingdom entity in
liquidation, and a related Debtor Canadian entity that is associated with certain de minimis
pension obligations; and (iii) other entities that hold miscellaneous assets, including a small
number of patents, trade names, IT assets, land, and other de minimis assets.
24

23
Excluding intercompany receivables.
24
Each of these entities other than Basic Resources, Inc., which owns certain comparatively minor patents and is a
wholly-owned subsidiary of non-Debtor EFH Properties Company, is a Debtor.

26

3. EFIH.
53. EFIH is a holding company and a direct, wholly-owned subsidiary of EFH Corp.
Its primary asset is its 100% ownership of Oncor Holdings, which, in turn, owns approximately
80% of Oncor. Oncor has made dividend distributions to EFIH (through Oncor Holdings)
totaling approximately $213 million, $147 million, $116 million, and $169 million in 2013,
2012, 2011, and 2010, respectively,
25
and approximately $37 million between January 1, 2014
and the Petition Date. EFIH has no active business operations, and its capital structure is
premised on the value derived from its indirect ownership of Oncor. EFIHs funded
indebtedness was issued in a series of post-2007 Acquisition transactions.
4. Oncor.
a. Overview of Oncors Business Operations.
54. Oncor is a transmission and distribution utility that provides transmission and
distribution services in Texas. Unlike Luminant and TXU Energy, whose rates are subject to
market competition, Oncors rates are fully regulated and are subject to detailed rate-setting
proceedings before the PUC. Oncor provides these services to REPs, including TXU Energy,
which sell electricity to residential and business customers, and electricity distribution
companies, cooperatives, and municipalities. TXU Energy is Oncors largest customer and
accounts for a large portion of Oncors annual operating revenues: approximately 27%, 29%,
33%, and 36% in 2013, 2012, 2011, and 2010, respectively.
26
Oncor operates the largest
transmission and distribution system in Texas: it covers more than 91 counties and over 400

25
Does not include amounts in 2012 and 2013 distributed by Oncor to Oncor Holdings that Oncor Holdings used
to pay its liability to EFH Corp. under the Oncor TSA.
26
These figures also include a relatively small amount attributable to TCEHs other REPs.

27

incorporated municipalities in Texas, delivers electricity to more than 3.2 million homes and
businesses, and operates more than 120,000 miles of transmission and distribution lines.
55. Pursuant to its organizational documents and applicable PUC orders and rules,
Oncor is restricted from making distributions under certain conditions. Oncor's dividend
distributions are limited by its regulatory capital structure, which is required to be at or below the
assumed debt-to-equity ratio established periodically by the PUC for ratemaking purposes. That
ratio is currently set at 60% debt to 40% equity. Additionally, Oncors independent directors,
acting by majority vote, and, during certain periods, any director designated by Oncors minority
investor, may prevent dividend distributions from Oncor if they determine that it is in the best
interests of Oncor to retain such amounts to meet expected future cash requirements.
b. The Ring-Fencing Measures.
56. As part of the 2007 Acquisition, Oncor implemented certain structural and
operational ring-fencing measures, including certain measures required by the PUC, to
enhance Oncors credit quality. The ring-fence has a number of components. Most importantly,
Oncors independence is ensured by a requirement that its board be composed of a majority of
directors that are independent from EFH Corp. and TCEH, and Oncor also has management and
employees separate from EFHs other businesses. Two of Oncors directors are appointed by
EFIH.
57. The ring-fence also provides that Oncor is prohibited from securing any
indebtedness of EFH Corp. or its other non-Oncor subsidiaries (including the Debtors).
27
In
addition to protecting Oncors credit rating, the prohibition on cross-collateralization means that

27
As noted below, certain obligations of EFCH that predate the 2007 Acquisition are secured by certain Oncor
assets.

28

Oncor is not subject to the operational and financial restraints in the various documents
governing the Debtors funded indebtedness.
58. Finally, among other things, Oncors books and records are maintained separately
from those of EFH Corp. and its non-Oncor subsidiaries, and Oncors headquarters are
physically separated from those of EFH Corp., Luminant, and TXU Energy.
59. None of the Oncor entities are Debtors in the chapter 11 cases. The Debtors
intend to respect and maintain the ring-fencing measures described above during the pendency of
the chapter 11 cases.
5. EFHs Regulatory Environment.
60. EFHs business operations are subject to significant regulation and oversight.
Certain of those regulators were discussed above, and the regulators that are most material to
EFHs business operations are identified in the following chart:
Agency or Entity Area(s) of Authority
Commodity Futures Trading Commission (the CFTC) Futures market derivatives and over-the-counter
derivatives (including interest rate swaps and
commodity swaps)
Electricity Reliability Council of Texas, Inc.
(the ERCOT)
Ensure reliable operation of transmission and
distribution grid in the ERCOT market
Dispatch generation to satisfy electricity
requirements in the ERCOT market
Manage real-time and day-ahead markets and
financial settlement process in wholesale electricity
markets in the ERCOT market
Environmental Protection Agency (the EPA) Air and water quality
Solid waste disposal
Equal Employment Opportunity Commission
(the EEOC)
Labor relations
Federal Communications Commission (the FCC) Wireless radio licenses for emergency radio
communication
Federal Energy Regulatory Commission (the FERC) FERC has nationwide electricity reliability
authority, including with respect to the ERCOT
market. The ERCOT market, however, is not
subject to the plenary jurisdiction of the FERC and
electricity sales within the ERCOT market are not
within the FERCs jurisdiction.
Mine Safety and Health Administration (the MSHA) Mine safety
North American Electric Reliability Corporation
(the NERC), in conjunction with the Texas Reliability
National electricity grid reliability standards

29

Agency or Entity Area(s) of Authority
Entity (the TRE)
Nuclear Regulatory Commission (the NRC) Nuclear operating licenses
Nuclear waste disposal
Occupational Safety and Health Administration
(the OSHA)
Workplace safety
Office of Surface Mining Reclamation and Enforcement
(the OSM)
Enforces federal surface mining and environmental
standards
Public Utility Commission of Texas (the PUC) Wide-ranging oversight over the Texas electricity
market including, among other things, ensuring
customer protection and regulating the rates and
services, as well as certain change of control
transactions, of transmission and distribution
utilities such as Oncor
Railroad Commission of Texas (the RCT) Permits, enforces, and oversees Texas surface
mining and land reclamation process
Texas Commission on Environmental Quality
(the TCEQ)
Air quality
Water quality
Waste management
61. Pursuant to 28 U.S.C. 959(b), the Debtors intend to comply with all applicable
regulatory requirements, including all requirements related to or associated with safety, health,
and environmental law compliance, during these chapter 11 cases. In addition, the Debtors will
seek all necessary regulatory approvals, if any, from state and federal regulatory authorities, in
connection with the Debtors business operations and any proposed plan of reorganization.
Moreover, to the extent the Debtors maintain insurance of their regulatory compliance
obligations, the Debtors intend to continue such insurance in the ordinary course of business.
62. The Debtors intend to continue funding their obligations related to a nuclear
decommissioning trust that will be used to fund the decommissioning of the Comanche Peak
plant. Those funding obligations are satisfied by customer surcharges collected by REPs on
behalf of Oncor and indirectly remitted from Oncor to TCEH.
28
The Debtors also intend to
remain in compliance with their mining land reclamation obligations, including their reclamation
bonding requirements, as discussed above.

28
The Debtors are seeking relief to continue making these payments to the nuclear decommissioning trust
pursuant to the Taxes Motion.

30

C. EFHs Capital Structure.
1. TCEH Debtors.
a. Overview.
63. The TCEH Debtors funded debt obligations as of the Petition Date totaled
approximately $32.068 billion (excluding obligations under certain first lien hedging
arrangements and capital leases). That amount includes approximately $24.385 billion of first
lien debt, approximately $1.571 billion of second lien debt, and approximately $6.112 billion of
unsecured debt,
29
as summarized in the following table:
Security Debt Obligation
Approx. Amount
Outstanding as of
the Petition Date
Interest or
Other Payment
Due Dates
Original
Maturity/Payoff
Date
Debtor Obligors
TCEH First Lien
Secured
TCEH Credit Agreement $22.635 billion Varies Varies All TCEH Debtors
TCEH First Lien Notes $1.750 billion
Jan. 1; April 1; July
1; Oct. 1
October 2020 All TCEH Debtors
TCEH First Lien Commodity
Hedges

TCEH First Lien Interest Rate
Swaps
Amount subject to
determination.
Varies Varies All TCEH Debtors

TCEH Second
Lien Secured
TCEH Second Lien Notes $1.571 billion
Jan. 1; April 1; July
1; Oct. 1
April 2021 All TCEH Debtors

TCEH
Unsecured
TCEH 2015 Unsecured Notes $3.488 billion May 1; Nov. 1 November 2015
All TCEH Debtors
TCEH Senior Toggle Notes $1.749 billion May 1, Nov. 1 November 2016
Pollution Control Revenue
Bonds
$875 million Varies Varies TCEH LLC

64. In addition to the amounts described above, EFCH is an unsecured guarantor of
approximately $60 million of unsecured notes issued by EFH Corp. that are discussed in more
detail below. Additionally, certain of the TCEH Debtors also have additional obligations not
reflected in the above table, which are discussed below.

29
Total amounts exclude unamortized premiums, set off rights, accrued but unpaid interest, and fair value
discounts, and include amounts held by EFH Corp. or EFIH. Amounts held by EFH Corp. or EFIH are noted
below. The unsecured debt amount also includes approximately $19 million of outstanding Pollution Control
Revenue bonds supported by letters of credit issued under the TCEH Credit Agreement.

31

b. TCEH First Lien Debt.
65. TCEHs first lien debt is composed of: (i) approximately $22.635 billion in
outstanding obligations under TCEHs first lien credit agreement (the TCEH Credit
Agreement); (ii) approximately $1.750 billion issued and outstanding TCEH 11.50% senior
secured notes (the TCEH First Lien Notes); and (iii) obligations related to TCEHs interest rate
swaps that are secured on a first lien basis (the TCEH First Lien Interest Rate Swaps) and
natural gas commodity hedges that are secured on a first lien basis (the TCEH First Lien
Commodity Hedges and, collectively with the TCEH Credit Agreement, the TCEH First Lien
Notes, and the TCEH First Lien Interest Rate Swaps, the TCEH First Lien Debt).
i. TCEH Credit Agreement.
66. Pursuant to the TCEH Credit Agreement, dated as of October 10, 2007 (as
amended, modified, or supplemented and in effect immediately prior to the Petition Date),
among TCEH LLC, as borrower, EFCH and the other TCEH Debtors, as guarantors, Citibank,
N.A., as administrative and collateral agent, and the lenders that are parties thereto from time to
time, the TCEH Debtors borrowed money from the lenders under term loan and revolving credit
facilities. As of the Petition Date, a total of approximately $22.635 billion was outstanding under
the TCEH Credit Agreement, which includes approximately $2.054 billion under a revolving
credit facility, approximately $1.062 billion under deposit letter of credit term loan facilities, and
approximately $19.519 billion of term loan facilities.
30

ii. TCEH First Lien Notes.
67. Pursuant to that certain indenture, dated April 19, 2011, for the 11.50% TCEH
First Lien Notes originally due October 1, 2020, by and among TCEH LLC and TCEH Finance,

30
Including approximately $19 million held by EFH Corp.

32

as issuers, the other TCEH Debtors, as guarantors, and BOKF, NA (d/b/a Bank of Arizona), as
successor indenture trustee to Bank of New York Mellon Trust Company, N.A. (BNY), TCEH
LLC and TCEH Finance issued the TCEH First Lien Notes. Approximately $1.75 billion in
principal amount of TCEH First Lien Notes are outstanding as of the Petition Date.
iii. TCEH First Lien Interest Rate Swaps and TCEH First
Lien Commodity Hedges.
68. The TCEH Debtors are party to (A) certain transactions with counterparties under
the TCEH First Lien Commodity Hedges and (B) certain transactions under the TCEH First Lien
Interest Rate Swaps used to hedge interest rate exposure on their variable rate debt. Certain
holders of TCEH First Lien Interest Rate Swaps are also counterparties to TCEH First Lien
Commodity Hedges. The amount of the TCEH Debtors obligations under these transactions,
including with respect to any netting of the TCEH First Lien Interest Rate Swaps and TCEH
First Lien Commodity Hedges, is subject to determination.
iv. Collateral Securing the TCEH First Lien Debt.
69. The TCEH First Lien Debt is secured by first priority liens on the collateral as
defined in the TCEH Credit Agreement and the TCEH First Lien Intercreditor Agreement
(defined below), including substantially all of the assets of TCEH LLC, and is guaranteed on a
secured basis by a first priority lien on EFCHs equity interests in TCEH LLC and by a first
priority lien on substantially all of the assets of the other TCEH Debtors. The collateral
documents governing the TCEH First Lien Debt provide that liens do not attach to certain
limited categories of assets as provided in the governing collateral documents.
c. TCEH Second Lien Notes.
70. Pursuant to that certain indenture, dated as of October 6, 2010 (as amended,
modified, or supplemented) for the 15% second lien notes (the TCEH Second Lien Notes)

33

originally due April 1, 2021, by and among TCEH LLC and TCEH Finance, as issuers, the other
TCEH Debtors, as guarantors, and Wilmington Savings Fund Society, FSB (a/k/a Christiana
Trust) (Wilmington Savings), as successor indenture trustee to BNY, TCEH LLC and TCEH
Finance issued the TCEH Second Lien Notes. Approximately $1.571 billion in principal amount
of TCEH Second Lien Notes are outstanding as of the Petition Date.
71. The TCEH Second Lien Notes are secured by a second priority lien on the
collateral as set forth in that certain second lien security agreement, dated as of October 6, 2010,
by and among the TCEH Debtors and BNY, as collateral agent, including substantially all of the
assets of the TCEH Debtors other than (i) the same categories of assets excluded from the TCEH
First Lien Debt and (ii) EFCHs equity interests in TCEH LLC and TCEH LLCs direct and
indirect equity interests in the TCEH Debtors if the pledge of such equity interests would require
that separate financial statements be filed with the Securities and Exchange Commission (the
SEC) for such subsidiaries. EFCHs guarantee of the TCEH Second Lien Notes is unsecured.
d. TCEH Unsecured Funded Debt.
i. Senior Unsecured Notes.
modified, or supplemented) for two series of unsecured notes (the TCEH Unsecured Notes),
by and among TCEH LLC and TCEH Finance, as issuers, the other TCEH Debtors, as
guarantors, and Law Debenture Trust Company of New York (LDTC), as successor indenture
trustee to BNY, TCEH LLC and TCEH Finance issued the TCEH Unsecured Notes. The
following TCEH Unsecured Notes are issued and outstanding as of the Petition Date:
approximately $3.488 billion principal amount of 10.25% notes originally due
November 1, 2015;
31
and

31
Including approximately $284 million held by EFH Corp. and approximately $79 million held by EFIH.

34

approximately $1.749 billion principal amount of 10.50% notes originally due
November 1, 2016.
ii. Pollution Control Revenue Bonds.
73. TCEH LLC has executed certain assumption agreements with respect to multiple
series of Pollution Control Revenue Bonds that are held by unaffiliated third-parties.
32
As of the
Petition Date, principal amounts outstanding under the Pollution Control Revenue Bonds totaled
approximately $875 million in the aggregate, with interest rates generally ranging from .29%
33
to
8.25%, and original maturities ranging from June 1, 2021 to March 1, 2041. Of that amount,
approximately $19 million of variable interest rate Pollution Control Revenue Bonds are
supported by outstanding letters of credit issued under the TCEH Credit Agreement.
34
The
remaining amounts outstanding under the Pollution Control Revenue Bonds are unsecured
obligations of TCEH LLC. TCEH LLCs obligations under these agreements are not secured or
guaranteed by any of the other TCEH Debtors.
e. Other TCEH Indebtedness.
i. EFCH 2037 Notes
74. Pursuant to that certain indenture, dated as of December 1, 1995, for two series of
notes (the EFCH 2037 Notes) originally due January 30, 2037, by and among EFCH, as issuer,
and BNY, as trustee, EFCH issued the EFCH 2037 Notes. Approximately $9 million in principal
amount of the EFCH 2037 Notes are outstanding as of the Petition Date, including
approximately $1 million of floating-rate notes and $8 million of 8.175% notes. The EFCH

32
Additional series of Pollution Control Revenue Bonds have been repurchased by TCEH LLC and are held in a
custody account.
33
As of March 31, 2013.
34
Before the Petition Date, these amounts were callable on a daily or weekly basis, depending on series.

35

2037 Notes are not secured or guaranteed, and are subordinate to EFCHs other funded
indebtedness.
ii. Tex-La Obligations.
75. EFCH is the principal obligor of, and EFH Corp. guarantees, approximately
$61 million of obligations related to a series of transactions by and among the predecessors of
EFH Corp. and EFCH, on one hand, and the Tex-La Electric Cooperative of Texas, Inc.
(Tex-La), on the other hand (the Tex-La Obligations). Approximately $29 million and
$32 million of the Tex-La Obligations were originally due in 2019 and 2021, respectively. The
Tex-La Obligations are secured by a 2.17% undivided ownership in Comanche Peaks electricity
generation and transmission assets and a 6.02% undivided ownership interest in the 51.5 mile
345 kV Comanche Peak-Cleburne-Everman transmission facility. The Tex-La Obligations relate
to a settlement of litigation between the predecessor of EFCH and Tex-La in 1990.
iii. Leases.
76. The TCEH Debtors are parties to leases relating to, among other things: (A) rail
cars; (B) office space; (C) equipment used in business operations, including mining equipment;
and (D) long-standing leases of tracts of real property.
77. Certain of the TCEH Debtors rail car leases are structured as leveraged leases.
Under these railcar leases, a trust owns railcars and leases the railcars to the TCEH Debtors. The
trusts, in turn, have issued notes that are secured by, among other things, the railcars subject to
the lease and the trusts interest in the lease.
iv. Fixed Facility Bonds.
78. The TCEH Debtors combustion turbine electricity generation assets are
structured as leveraged leases that are similar to the railcar leveraged leases discussed above.
Importantly, however, the TCEH Debtors own the beneficial equity interests in the trusts that

36

own these assets. Accordingly, the TCEH Debtors are the beneficial owners and the lessors of
these assets. Approximately $39 million remains outstanding on the notes secured by the
combustion turbines.
v. Oak Grove Promissory Note.
79. In December 2010, Oak Grove Power Company LLC (Oak Grove), an indirect
subsidiary of TCEH LLC, purchased certain mineral rights located in Robertson County, Texas
from North American Coal Royalty Company. Concurrent with the sale, Oak Grove executed
the Oak Grove Promissory Note, which is non-interest bearing and secured by the purchased
assets. Approximately $3 million is outstanding under the Oak Grove Promissory Note as of the
Petition Date.
f. Intercreditor Agreements.
i. TCEH First Lien Intercreditor Agreement.
80. The TCEH first lien intercreditor agreement (as amended, restated, modified, and
supplemented from time to time, the TCEH First Lien Intercreditor Agreement) entered into by
and among the TCEH Debtors, Citibank, N.A., as administrative agent and collateral agent,
certain holders of claims under the TCEH First Lien Debt, and other parties thereto from time to
time, governs certain rights and remedies as between the various holders of claims under the
TCEH First Lien Debt, relative priority of claims, and certain rights and remedies in these
chapter 11 cases. In particular, the TCEH First Lien Intercreditor Agreement provides that the
collateral agent, acting at the direction of the majority of holders of claims under the TCEH First
Lien Debt, may consent to the use of cash collateral and the acquisition of postpetition debtor-in-
possession financing.

37

ii. TCEH Second Lien Intercreditor Agreement.
81. The TCEH second lien intercreditor agreement (as amended, restated, modified
and supplemented from time to time, the TCEH Second Lien Intercreditor Agreement) entered
into by and among the TCEH Debtors, Citibank, N.A., in its capacity as successor first lien agent
and collateral agent, and Wilmington Savings, as successor second lien indenture trustee,
governs certain rights and remedies as between the holders of claims under the TCEH First Lien
Debt, on one hand, and the holders of claims under the TCEH Second Lien Notes, on the other
hand, including certain rights and remedies in these chapter 11 proceedings. In particular, the
TCEH Second Lien Intercreditor Agreement provides that if the collateral trustee, acting at a
direction of a majority of the holders of TCEH First Lien Debt pursuant to the TCEH First Lien
Intercreditor Agreement, consents to the use of cash collateral and the acquisition of postpetition
debtor-in-possession financing, the holders of TCEH Second Lien Notes may not contest such
relief.
2. EFH Corp. and EFIH.
a. Overview.
82. As of the Petition Date, EFH Corp. and EFIH had outstanding funded
indebtedness of approximately $1.929 billion at EFH Corp. and approximately $7.709 billion at
EFIH as summarized in the following table:
35

35
In addition to these amounts, EFH Properties Company is obligated on a leveraged lease relating to Energy
Plaza, EFHs corporate headquarters. The lease is currently serviced by the proceeds of a previously-drawn
letter of credit issued under the TCEH Credit Agreement. EFH Corp. has a receivable from EFH Properties
Company for this letter of credit, and reimbursed the TCEH Debtors for this letter of credit when it settled its
obligations under the TCEH Demand Note (defined herein).

38

Security Debt Obligation
Approx. Amount
Outstanding as of
the Petition Date
Interest
Payment Due
Dates
Original
Maturity/Payoff
Date
Obligors
EFH Corp. Debt
EFH Corp.
Unsecured
EFH Legacy Notes $1.864 billion
36

May 15; November
15
Varies by series,
November 2014,
November 2024,
and November
2034
EFH Corp. as issuer
EFH LBO Notes $60 million May 1; November 1 November 2017
EFH Corp. as issuer
EFCH as unsecured
guarantor
EFIH as unsecured
guarantor
EFH Unexchanged Notes $5 million Varies Varies EFH Corp. as issuer
EFIH Debt
EFIH First Lien
Secured
EFIH First Lien 2017 Notes $503 million
February 15;
August 15
August 2017
EFIH and EFIH Finance as
issuers
EFIH First Lien 2020 Notes $3.482 billion
June 1;
December 1
December 2020

EFIH Second
Lien Secured
EFIH Second Lien 2021
Notes
$406 million
May 15;
November 15
October 2021
issuers EFIH Second Lien 2022
Notes
$1.750 billion
March 1;
September 1
March 2022

EFIH Unsecured
EFIH Senior Toggle Notes $1.566 billion
June 1;
December 1
December 2018
issuers
EFIH Unexchanged Notes $2 million
April 15;
October 15
October 2019
b. EFH Corp. Debt.
83. Approximately $1.929 billion in outstanding unsecured notes issued by EFH
Corp. (the EFH Unsecured Notes) are outstanding as of the Petition Date (including amounts
held by EFIH). In addition to the EFH Unsecured Notes, EFH Corp. guarantees the Tex-La
Obligations described above.
i. EFH Legacy Notes.
84. Pursuant to three separate indentures, each dated as of November 1, 2004 (as
amended, modified, or supplemented), and three associated officers certificates, each dated as of
November 26, 2004, for three series of unsecured notes (the EFH Legacy Notes), by and
among EFH Corp., as issuer, and American Stock Transfer & Trust Company, LLC (AST), as
successor indenture trustee to BNY, the predecessor to EFH Corp. issued the EFH Legacy Notes.
The following EFH Legacy Notes are outstanding as of the Petition Date:

36
Includes approximately $1.282 billion held by EFIH.

39

approximately $371 million principal amount of 5.55% notes originally due
November 15, 2014;
37

November 15, 2024;
38
and
November 15, 2034.
39

ii. EFH LBO Notes.
modified, or supplemented) for two series of notes (the EFH LBO Notes) originally due
November 1, 2017, by and among EFH Corp, as issuer, EFCH and EFIH, as guarantors, and
AST, as successor indenture trustee to BNY, EFH Corp. issued the EFH LBO Notes. The EFH
LBO Notes are guaranteed on an unsecured basis by EFCH and EFIH. Approximately $60
million principal amount of EFH LBO Notes, including $33 million of 10.875% notes and $27
million of 11.25% notes, are outstanding as of the Petition Date.
iii. EFH Unexchanged Notes.
86. Pursuant to two separate indentures, one dated November 16, 2009, and the other
dated January 12, 2010 (each as amended, modified, or supplemented) for two series of
unsecured notes (the EFH Unexchanged Notes), by and among EFH Corp., as issuer, and AST,
as successor indenture trustee to BNY, EFH Corp. issued the EFH Unexchanged Notes. The
EFH Unexchanged Notes are unsecured, unguaranteed obligations of EFH Corp. Approximately
$3 million of 10.00% EFH Unexchanged Notes originally due January 2020 and $2 million of

37
Approximately $281 million of these notes are held by EFIH.
38
39

40

9.75% EFH Unexchanged Notes originally due October 2019 are outstanding as of the Petition
Date.
40

c. EFIH Debt.
87. As of the Petition Date, EFIH has approximately $7.709 billion in outstanding
funded indebtedness, including approximately: (i) $3.985 billion of first lien notes (the EFIH
First Lien Notes); (ii) approximately $2.156 billion of second lien notes (the EFIH Second
Lien Notes); and (iii) approximately $1.568 billion of unsecured notes (the EFIH Unsecured
Notes).
41
Additionally, as described above, EFIH is an unsecured guarantor of approximately
$60 million of EFH LBO Notes.
i. EFIH First Lien Notes.
88. Pursuant to that certain indenture, dated August 14, 2012 (as amended, modified,
or supplemented), for the 6.875% EFIH First Lien Notes originally due August 15, 2017, by and
among EFIH and EFIH Finance, as issuers, and CSC Trust Company of Delaware (CSC) as
successor indenture trustee to BNY, EFIH and EFIH Finance issued a series of EFIH First Lien

40
The EFH Unexchanged Notes were previously guaranteed by EFCH and EFIH. EFIHs guarantee was secured
by a first priority lien on EFIHs equity interest in Oncor. The guarantees and lien were eliminated in
subsequent transactions.
41
These amounts do not include any EFIH Makewhole Claims (as defined herein). As discussed below, EFIH
and EFIH Finance (the EFIH Debtors) have contemporaneously filed the Motion of Energy Future
Intermediate Holding Company LLC and EFIH Finance, Inc. for Entry of (I) an Interim Order (A) Approving
Certain Fees Related to Postpetition Financing and Granting Such Fees Administrative Expense Priority and
(B) Scheduling a Final Hearing; and (II) a Final Order (A) Approving Postpetition Financing, (B) Granting
Liens and Providing Superpriority Administrative Expense Claims, (C) Authorizing the Use of Cash Collateral,
(D) Authorizing the EFIH First Lien Refinancing, (E) Authorizing Issuance of Roll-Up Debt to the Extent
Authorized by the Settlement Motion, (F) Determining the Value of Secured Claims, and (G) Modifying the
Automatic Stay (the EFIH First Lien DIP Motion), pursuant to which the EFIH Debtors seek the authority to
borrow approximately $5.35 billion to fund their obligations during these chapter 11 cases and refinance the
EFIH First Lien Notes in full. In connection with the EFIH First Lien DIP Motion, the EFIH Debtors seek a
determination that no make-whole amounts are due. The EFIH Debtors will also seek to refinance the EFIH
Second Lien Notes pursuant to a separate motion filed on or around the Petition Date. The EFIH Debtors will
seek to disallow any EFIH Second Lien Makewhole Claims asserted as a result of the EFIH Second Lien
Refinancing.

41

Notes, of which approximately $503 million principal amount is outstanding as of the Petition
Date.
42

89. Pursuant to that certain indenture, dated August 17, 2010 (as amended, modified,
or supplemented), for the 10.00% EFIH First Lien Notes originally due December 1, 2020, by
and among EFIH and EFIH Finance, as issuers, and CSC, as successor indenture trustee to BNY,
EFIH and EFIH Finance issued a series of EFIH First Lien Notes, of which approximately
$3.482 billion principal amount is outstanding as of the Petition Date.
43

90. The EFIH First Lien Notes are secured by first priority liens in the collateral as
defined in the EFIH Collateral Trust Agreement (defined below) and certain related
documentation, specifically, EFIHs equity interest in Oncor Holdings. The EFIH First Lien
Notes are not guaranteed.
ii. EFIH Second Lien Notes.
91. Pursuant to that certain indenture, dated April 25, 2011 (as amended, modified, or
supplemented) for the EFIH Second Lien Notes, by and among EFIH and EFIH Finance, as
issuers, and Computershare Trust Company, N.A. and Computershare Trust Company of Canada
(Computershare) as successor indenture trustee to BNY, EFIH issued two series of EFIH

42
Pursuant to a registration rights agreement, EFIH agreed to use its commercially reasonable efforts to register
notes under the Securities Act having substantially the same terms as the EFIH First Lien 2017 Notes as part of
an offer to exchange freely tradable notes for the EFIH First Lien 2017 Notes by August 14, 2013. The
exchange offer was not completed by August 14, 2013, resulting in a .25% increase in interest rate. Under the
terms of the registration rights agreement, the interest rate on the EFIH First Lien 2017 Notes increased by
another .25% 90 days after August 14, 2013. The Debtors have reserved all of their rights with respect to the
registration rights agreement.
43
notes under the Securities Act having substantially the same terms as the EFIH First Lien 2017 Notes as part of
an offer to exchange freely tradable notes for approximately $1.302 billion of the EFIH First Lien 2017 Notes
issued in January 2013. Under the terms of the agreement, the registration was supposed to occur by January
29, 2014. The exchange offer was not completed by January 29, 2014, resulting in a .25% increase in interest
rate. Under the terms of the registration rights agreement, the interest rate on the applicable EFIH First Lien
2017 Notes will increase by another .25% on April 30, 2014. The Debtors have reserved all of their rights with
respect to the registration rights agreement.

42

Second Lien Notes. The following EFIH Second Lien Notes are outstanding as of the Petition
Date:
approximately $406 million principal amount of 11.00% EFIH Second Lien Notes
originally due October 1, 2021; and
approximately $1.750 billion principal amount of 11.75% EFIH Second Lien Notes
originally due March 1, 2022.
44

92. The EFIH Second Lien Notes are secured by second priority liens in the collateral
as defined in the EFIH Collateral Trust Agreement (defined below) and certain related
documentation, specifically, EFIHs equity interest in Oncor Holdings. The EFIH Second Lien
Notes are not guaranteed.
iii. EFIH Unsecured Notes.
93. Pursuant to that certain indenture, dated as of November 16, 2009 (as amended,
modified, or supplemented) for the 9.75% unsecured notes (the EFIH Unexchanged Notes)
originally due October 15, 2019, by and among EFIH and EFIH Finance, as issuers, and UMB
Bank, N.A. (UMB), as successor indenture trustee to BNY, EFIH and EFIH Finance issued the
EFIH Unexchanged Notes. Approximately $2 million of EFIH Unexchanged Notes are
outstanding as of the Petition Date.
45

94. Pursuant to that certain indenture, dated as of December 5, 2012 (as amended,
modified, or supplemented) for 11.25%/12.25% toggle notes (the EFIH Senior Toggle Notes)
originally due December 1, 2018, by and among EFIH and EFIH Finance, as issuers, and UMB,

44
notes under the Securities and Exchange Act having substantially the same terms as the EFIH Second Lien 2022
Notes as part of an offer to exchange freely tradable notes for the EFIH Second Lien 2022 Notes by February 5,
2013. The exchange offer was not completed by February 5, 2013, resulting in a .25% increase in interest for
90 days and an additional .25% increase when the exchange offer was not completed by May 6, 2013. The
Debtors have reserved all of their rights with respect to the registration rights agreement.
45
The EFIH Unexchanged Notes were previously secured by a first priority lien on EFIHs equity interest in
Oncor Holdings. The lien was eliminated in subsequent transactions.

43

as successor indenture trustee to BNY, EFIH and EFIH Finance issued the EFIH Senior Toggle
Notes. Approximately $1.566 billion of EFIH Senior Toggle Notes are outstanding as of the
Petition Date.
46

d. EFIH Collateral Trust Agreement.
95. The collateral trust agreement (as amended, restated, modified, and supplemented
from time to time, the EFIH Collateral Trust Agreement) entered into by and among EFIH,
CSC, as successor indenture trustee for the EFIH First Lien Notes and as successor Collateral
Trustee in the indentures governing the EFIH First Lien Notes and the EFIH Second Lien
Notes, Computershare, as indenture trustee for the EFIH Second Lien Notes, and other parties
thereto from time to time, governs certain rights and remedies as between the holders of claims
under the EFIH First Lien Notes, on one hand, and holders of claims under the EFIH Second
Lien Notes, on the other hand, including certain rights and remedies in these chapter 11
proceedings. In particular, the EFIH Collateral Trust Agreement provides that the collateral
trustee, acting at the direction of a majority of holders of the EFIH First Lien Notes, may consent
to the use of cash collateral and the acquisition of postpetition debtor-in-possession financing,
and that holders of EFIH Second Lien Notes may not contest such relief.
3. Oncor.
96. As of December 31, 2013, Oncor, together with its subsidiary Oncor Electric
Delivery Transition Bond Company LLC (Oncor BondCo), had approximately $6.29 billion of
outstanding funded indebtedness. The Debtors expect that none of Oncors business operations,

46
notes under the Securities and Exchange Act having substantially the same terms as the EFIH Senior Toggle
Notes as part of an offer to exchange freely tradable notes for the EFIH Senior Toggle Notes by December 5,
2013. The exchange offer was not completed by December 5, 2013, resulting in a .25% increase in interest for
90 days and an additional .25% increase when the exchange offer was not completed by March 5, 2014. The
Debtors have reserved all of their rights with respect to the registration rights agreement.

44

assets, or liabilities, including Oncors and Oncor BondCos outstanding funded indebtedness,
will be materially affected by the chapter 11 cases. Oncors outstanding funded indebtedness
will vary during these chapter 11 cases.
Part II.
The Events Leading to the Chapter 11 Cases
A. History of EFH Corp.
97. TXU Corp. (the predecessor of EFH Corp.) was historically a
geographically-determined, vertically-integrated, rate-regulated monopoly electricity provider.
In other words, TXU Corp. generated its own electricity and transmitted and sold that electricity
to customers within its service territory at rates determined by the PUC. That changed with the
partial deregulation of the Texas electricity market, which proceeded in two steps. First, in
1995, the Texas legislature passed legislation to begin deregulation of the wholesale electricity
market. Second, in 1999, the Texas legislature passed legislation that mandated deregulation of
the retail electricity market and unbundling of integrated utilities in the competitive ERCOT
market into separate transmission and distribution utilities, which remained rate-regulated, and
competitive electricity generators/wholesalers and retail electricity providers, to be accomplished
by 2002. Accordingly, in 2002, TXU Corp. separated its regulated transmission and distribution
utility from its deregulated generation, wholesale, and retail electricity units. The transmission
and distribution utility remained rate-regulated while the generation, wholesale, and retail
businesses became subject to market-driven prices and competitive forces.
98. As discussed in greater detail below, the wholesale price of electricity is closely
related to the price of natural gas in the ERCOT market. The monthly settled price of natural gas
almost tripled between 1999 and 2006, resulting in significant increases in the enterprise value of
TXU Corp. Moreover, the robust Texas economy led to continuing increases in the demand for

45

electricity. As a result of increases in natural gas prices, along with other efforts undertaken in
the mid-2000s to address certain leverage and over-diversification issues, TXU Corp.s
performance improved and its stock value significantly increased between 2003 and early 2007.
B. The 2007 Acquisition.
99. On February 26, 2007, TXU Corp. announced that it had entered into a merger
agreement with the EFH Equity Owners (along with certain co-investors). The merger
agreement contemplated that the EFH Equity Owners and their co-investors, through a merger
involving a merger subsidiary of the newly-created Texas Energy Future Holdings Limited
Partnership, would acquire all outstanding shares of TXU Corp. for $69.25 per share in cash.
This amount represented a premium over the stock price of TXU Corp. before the 2007
Acquisition was announced.
100. In the 2007 Acquisition transaction, approximately $31.5 billion in new debt was
issued, including approximately $27 billion at TCEH and approximately $4.5 billion at EFH
Corp. Additionally, Oncor and TCEH drew approximately $1.3 billion and $250 million on new
revolving credit facilities, respectively. Finally, the EFH Equity Holders and their co-investors
contributed approximately $8.3 billion as equity capital. The 2007 Acquisition resulted in the
cash buy-out of the equity held by former TXU Corp. shareholders totaling approximately $31.9
billion and the assumption of approximately $14.7 billion of existing debt, of which
approximately $6.5 billion was repaid when the 2007 Acquisition closed.
47
Following these
transactions, EFH had approximately $41.3 billion of outstanding funded indebtedness, including
approximately $28.8 billion at TCEH, $128 million at EFCH, $7.2 billion at EFH Corp., and

47
Amounts exclude capital leases and a promissory note.

46

$5.2 billion at Oncor. The 2007 Acquisition wasand remainsthe largest private buy-out in
history.
C. EFH Following the 2007 Acquisition.
101. After the 2007 Acquisition, the EFH Equity Owners put in place an experienced
management team, including the retention of key pre-2007 Acquisition management, and also
elected a well-qualified, diverse board of directors to execute their plan to improve EFHs
immediate and long-term competitive position. Today, EFH continues to be led by an
experienced team of management and directors, who include, among others:
Donald L. Evans, who has been the Chairman of EFH Corp. since October 2007. Mr.
Evans previously served as the U.S. Secretary of Commerce.
John Young, who has been the President and CEO of EFH Corp., TCEH LLC, and
EFIH since January 2008. Mr. Young previously held many leadership roles at
Exelon Corporation from March 2003 to January 2008, including Executive Vice
President and Chief Financial Officer of Exelon Corporation; President of Exelon
Generation; and President of Exelon Power. Before joining Exelon, Mr. Young was
Senior Vice President of Sierra Pacific Resources Corporation, Executive Vice
President of Southern Generation, and served as a naval officer in the United States
Navy for 5 years. In sum, Mr. Young has 30 years of experience in the utility
industry.
Paul Keglevic, who has been the CFO of EFH Corp., TCEH, and EFIH since July
2008, the co-CRO of EFH Corp. since October 2013, and the co-CRO of TCEH LLC
and EFIH since February 2014. Mr. Keglevic previously was
PricewaterhouseCoopers' Utility Sector Leader from 2002 to 2008 and Clients and
Sector Assurance Leader from 2007 to 2008. Before that, Mr. Keglevic was the head
of the utilities practice and Pacific Rim Managing Partner at Arthur Andersen, where
he was a partner for 15 years. In sum, Mr. Keglevic has 38 years of experience in the
utility industry.
Stacey Dor, who has been the General Counsel of EFH Corp., TCEH LLC, and
EFIH since April 2012, the co-CRO of EFH Corp. since October 2013, and the
co-CRO of TCEH LLC and EFIH since February 2014. Ms. Dor has been with EFH
since December 2008 and previously served as Associate General Counsel of
Litigation and General Counsel of Luminant. Ms. Dor was previously an attorney at
Vinson & Elkins.
Mac McFarland, who has been CEO of Luminant since December 2012. Mr.
McFarland has been with EFH since July 2008 and previously served as Executive
Vice President and Chief Commercial Officer of Luminant. Before joining Luminant,

47

Mr. McFarland served as Senior Vice President of Mergers, Acquisitions and
Divestitures and as a Vice President in the wholesale marketing and trading division
power team at Exelon Corporation. In sum, Mr. McFarland has 16 years of
experience in the utility industry.
Jim Burke, who has been the CEO of TXU Energy since August 2005. Mr. Burke
has been with EFH since October 2004 and previously served as Senior Vice
President of Consumer Markets of TXU Energy. Before joining TXU Energy, Mr.
Burke served as President and Chief Operating Officer of Gexa Energy and as a
Senior Vice President of Consumer Operations with Reliant Energy, two other major
Texas REPs. Previously, Mr. Burke worked for the Coca-Cola Company for six
years in finance and general management for the domestic and international juice
divisions. In sum, Mr. Burke has more than 20 years of experience in the retail
services and consumer products industry, including 14 years in the retail electricity
market.
102. EFHs management team and board of directors have focused their efforts on
implementing a host of initiatives that have resulted in numerous operational accomplishments
notwithstanding challenging wholesale electricity market conditions. In addition to the specific
initiatives discussed below, management has, among other things:
identified and invested more than $10 billion in new electric infrastructure in Texas,
including three new generation units, two new mining complexes, new transmission
and distribution wires, approximately two million advanced meters, and also
upgraded critical support and IT systems;
increased Adjusted EBITDA
48
from approximately $4.578 billion in 2008 to
approximately $5.257 billion in 2012 and $4.699 billion in 2013 despite low
wholesale electricity prices and other challenging market conditions;
achieved a reduction of approximately 15% in selling, general, and administrative
expenses for the competitive businesses, including bad debt expenses, from 2009 to
2013, successfully reducing costs without negatively impacting necessary capital
expenditures; and
hired and/or insourced approximately 1,900 employees to support new assets,
improve customer service, and improve operations.

48
Adjusted EBITDA measures earnings (net income) before interest expense, income taxes, depreciation, and
amortization, adjusted to exclude noncash items, unusual items, and other adjustments allowed under certain of
EFHs debt documents.

48

1. Luminant Remains a Market Leader in All Aspects of Electricity
Generation and Wholesale Operations.
103. Following the 2007 Acquisition, Luminant continued a robust hedging program
designed to reduce the risks of a decline in wholesale electricity prices. The hedging program
used financial natural gas instruments to reduce Luminants exposure to declines in future
wholesale electricity prices that result from decreases in the price of natural gas. This program
has operated as designed and contributed approximately $998 million, $1.833 billion, and
$1.265 billion, $1.152 billion, and $752 million of TCEHs Adjusted EBITDA in 2013, 2012,
2011, 2010, and 2009, respectively, compared to TCEHs overall Adjusted EBITDA of $2.919
billion, $3.574 billion, $3.584 billion, $3.85 billion, and $3.634 billion in those same years. As
discussed below, however, a significant portion of TCEHs hedge program matured in 2013, and
the remaining position has, or will, mature in 2014.
104. Luminant also completed construction on three new lignite/coal units in 2009 (for
new units at Sandow and Oak Grove) and 2010 (for a second new unit at Oak Grove) and offset
100% of key emissions from the new units through a voluntary emissions reduction program.
The new units satisfied one of many commitments made in connection with the 2007
Acquisition, helped to ensure sufficient generation capacity in the ERCOT market, and were
completed on-time and on-budget. Luminant also terminated plans for eight additional
lignite/coal generation units in compliance with its 2007 Acquisition-related commitments.
105. Since the 2007 Acquisition, Luminant has achieved significant operational
milestones while making significant investments in environmental improvements. Luminants
nuclear and lignite/coal-fueled generation units are consistently among the most reliable and
efficient in the country. Additionally, the two new units at Oak Grove have the lowest key
emissions rates of any Texas lignite units with rates that are at least 63% lower than the national

49

average for coal units. Since the 2007 Acquisition, Luminant has increased its
lignite/coal-fueled generation output by 21% while satisfying its commitment to decrease the key
emissions of its lignite/coal-fueled units by more than 20% from a 2005 benchmark. Luminant is
also a significant purchaser of wind-generated electricity in Texas, with contracts for
approximately 700 MW of wind power and related renewable energy credits. These purchases
have allowed Luminant to contribute to environmental improvements and allowed TXU Energy
to diversify its retail product offerings.
106. Luminants mining activities have also continued to add value to EFH and,
specifically, to the TCEH Debtors. Since the 2007 Acquisition, Luminant has added two mines
and is in the process of opening three additional mining operations and expanding operations at
other sites. Additionally, Luminant has been the recipient of numerous awards and
acknowledgements related to mining safety and land reclamation, including an unprecedented
five Directors Awards for advancing the science of reclamation from the U.S. Department of the
Interiors Office of Surface Mining, most recently in 2009; the Texas Coal Mining Reclamation
Award from the RCT in 2014; and the 2014 National Mine Reclamation Award in the coal
category from the Interstate Mining Compact Commission.
107. Importantly, Luminant has achieved these operational successes while
maintaining a very strong safety record. For example:
in 2012, Luminant recorded its best safety year on record as measured by a key
industry standard of number of incidents reportable to the Occupational Safety and
Health Administration per 200,000 man-hours;
three of Luminants mines have recorded between two and four years without any
injuries that resulted in lost timein other words, no workers at those mines have
been injured in a way that has resulted in any time off the job;
Luminants natural gas-fueled plants have had no lost time injuries for nine years;

50

the Monticello lignite/coal-fueled plant has not had a lost-time injury for 21 years;
and
Comanche Peaks employees and contractors have worked more than seven million
total hours without a lost-time injury.
2. TXU Energy Remains a Market-Leading REP.
108. TXU Energy has maintained its position as a leading REP in Texas by providing
top-tier customer services, focusing on target customers, leveraging its high brand recognition,
maintaining highly competitive retail prices, and providing innovative products and services.
Importantly, TXU Energy has reduced customer complaints by more than 88% since 2009 and is
in the top decile of performance in the industry with respect to customer complaints. At the
same time, TXU Energy has lowered bad debt expense by 71% since 2009 through collection
initiatives, customer mix initiatives, and credit policy improvements. TXU Energy has also
maintained its position as a leader in technological innovation, leading the way in developing
digital capabilities that allow customers to manage and control their electricity costs, such as
smart phone applications that allow users to adjust their thermostat remotely. TXU Energys
commitment to innovation makes its products more attractive to customers and improves the
environmental footprint of EFH by improving its customers energy efficiency.
109. Following the 2007 Acquisition, TXU Energy instituted a 15% residential price
cut to legacy customers, making it the lowest-cost incumbent provider in Texas, and locked those
rates in place through 2008. TXU Energy also provided approximately $125 million in
low-income customer assistance through 2012, waived deposit requirements for certain
customers, and formed a new Low Income Advisory Committee made up of leaders in the social
service delivery sector. TXU Energy Aid
SM
is the companys flagship program for customers in
need and is the largest bill payment assistance program in the nation among electricity providers.

51

Over the past 30 years, TXU Energy Aid
SM
has provided more than $84 million to help more
than 455,000 current or former customers in temporary financial need pay their electric bills.
110. Additionally, TXU Energy has invested more than $100 million to develop
innovative, sustainable, and energy savings products and services to help customers better
manage their electricity usage. The suite of sustainability and energy savings solutions, as well
as time of use electricity plans, benefit residential and business customers. A portion of the
investment was dedicated to initiatives for low-income customers. The program has been
beneficial to the environmentlower consumption means lower levels of pollutantsand
beneficial to EFHs ability to attract and retain customers demanding greater control over their
electricity use.
111. TXU Energys initiatives have generated positive results. There are more than 50
REPs offering more than 300 electricity plans to residential customers in areas serviced by
Oncor. Yet, even with that level of competition, TXU Energys annual residential customer net
attrition numbers have declined since 2011. In fact, TXU Energy had less than 1% net attrition
in both the third and fourth quarters of 2013. Indeed, TXU Energy has the lowest residential net
attrition among the incumbent REPs (i.e., REPs that are associated with a pre-deregulation
electric utility) in the areas traditionally served by those incumbent REPs since 2001. In other
words, since deregulation in 2002, TXU Energy has maintained a larger portion of its residential
customers than other incumbent REPs.
49

49
Based on information provided by the PUC that evaluates the number of residential customers who purchase
electricity from the REP that is historically associated with that customers regulated transmission and
distribution utility. In other words, a higher percentage of Oncors customers purchase their electricity from
TXU Energy compared to the same statistic for the other regulated transmission and distribution utilities and
formerly affiliated REPs in Texas.

52

3. Other Initiatives.
112. Following the 2007 Acquisition, EFH put a number of initiatives in place in
addition to the operational improvements at TXU Energy and Luminant. Importantly, EFH has
focused on achieving cost savings and service excellence in its provision of shared services to
create value for TCEH and the rest of EFH. The results have been positive: costs have declined
significantly while service has improved significantly. Part of that improvement has been the
reversal of certain outsourcing agreements for human resources, IT, supply chain, and some
accounting functions. Insourcing a significant portion of those functions has resulted in lower
cost to EFH while also improving the quality of service to the business and external customers.
113. Additionally, EFH established a sustainable energy advisory board composed of
labor, economic development, reliability/technology, and environmental advocacy
representatives of the Texas community as part of a long-term commitment to being a leader on
sustainability issues.
D. The Result of Low Natural Gas Prices on EFHs Financial Performance
Following the 2007 Acquisition.
114. The 2007 Acquisition was driven, in part, by the expectation that natural gas
prices and wholesale electricity prices in the ERCOT market would either stay steady or continue
to rise over the long run, or, at a minimum, that there would not be a significant long-term
decline in natural gas prices. These expectations held true in the year following the 2007
Acquisition. The monthly NYMEX Henry Hub settled price of natural gas futures contracts was
$6.42 per MMBtu in October 2007, when the 2007 Acquisition closed. In 2008, that figure rose
as high as $13.11 per MMBtu. Additionally, the average monthly NYMEX Henry Hub futures
contract settled prices for the years ending December 31, 2007 and 2008 were $6.86 per MMBtu
and $9.03 per MMBtu, respectively. Those increases in natural gas prices contributed, in part, to

53

increases in ERCOT wholesale electricity prices from $52.42 per MWh in 2007 to $63.44 per
MWh in 2008. Operating revenues for the competitive electric segment (i.e., TCEH) increased
from $8.56 billion to $9.79 billion in the years ending December 31, 2007 and 2008,
respectively, due in part to higher wholesale electricity prices reflecting rising natural gas prices.
As discussed below, however, technological breakthroughs began to fundamentally alter the
energy landscape beginning in 2008, leading, in principal part, to the Debtors current financial
difficulties.
1. The Texas Electricity Market and the Role of ERCOT.
115. Texas is the largest electricity market in the United States and the eleventh-largest
electricity market worldwideranking ahead of, among others, the United Kingdom, Italy, and
Spain. Several regional reliability coordinating organizations are responsible for ensuring the
reliability of the Texas electricity system, and ERCOT is the largest such organization. The
ERCOT market covers 75% of Texass land mass and represents approximately 85% of the
electricity consumption in Texas.
116. The ERCOT mark is a unique power island contained within Texas. The
following map shows reliability areas, which are generally subject to regulation by the FERC
and several regional reliability agencies.

54

117. Most of these reliability areas are part of the much larger western and eastern
interconnections. The ERCOT reliability region, by contrast, is also its own standalone
interconnection, and it has very limited export and import capability. Accordingly,
approximately 98% of the electricity generated in the ERCOT market is consumed in the
ERCOT market.
118. ERCOT is the regional independent system operator (ISO) for the ERCOT
interconnectionby contrast, no other interconnections or reliability regions are completely
served by a single ISO. ERCOT schedules power on an electric grid that connects 40,500 miles
of transmission lines and more than 550 generation units, comprising approximately 84,500 MW
of installed generation capacity, including approximately 2,000 MW of idled capacity and more
than 11,500 MW of wind and other resources that are not available under certain conditions. Of
the total installed capacity, approximately 59% is natural gas-fueled generation, 28% is
lignite/coal and nuclear-fueled generation, and 13% is fueled by wind and other renewable
resources.

55

119. ERCOT is responsible for procuring energy on behalf of its members while
maintaining the reliable operation of the electricity supply system in the market. ERCOT also
performs financial settlements for the competitive wholesale electricity market and enforces
certain credit requirements, including collateral posting requirements, to ensure market
participants creditworthiness for transactions facilitated by ERCOT. Additionally, ERCOT
administers retail switching for the 6.7 million customers
50
in the ERCOT market that have the
ability to choose their REP. ERCOTs membership consists of approximately 300 corporate and
associate members, including electric cooperatives, municipal power agencies, independent
generators, independent power marketers, investor-owned utilities, REPs, and consumers.
ERCOT operates under reliability standards set by the NERC and the TRE and is subject to
regulatory and legislative oversight by the PUC.
120. Notwithstanding the ERCOT markets power island status, the delivery of
electricity in the ERCOT market operates similarly to other electricity markets in the United
States. Market participants buy and sell electricity utilizing both the spot or real-time market
(i.e., electricity for current transmission/distribution and use by consumers) and the day-ahead
market, both of which are facilitated by ERCOT in its role as the ISO, and through bilateral
contracts that indirectly facilitate the majority of wholesale electricity sales in the ERCOT
market. These markets allow ERCOT, in conjunction with the qualified scheduling entities that
transact directly in the day-ahead and spot markets (facilitated by the bilateral contracts entered
into between electricity generators/wholesalers, retailers, and the qualified scheduling entities),
to ensure that electricity is reliably delivered to all market participants.

50
Measured by number of electricity meters.

56

a. The Role of Natural Gas in Wholesale Electricity Pricing in the
ERCOT Market.
121. Natural gas-fueled generation accounted for approximately 59% of the electricity
generation capacity, and 41% of the electricity actually produced and consumed, in the ERCOT
market in 2013. Natural gas units, however, meet the peak, or marginal, electricity demand
approximately 70-90% of the year. Accordingly, when natural gas-fueled units satisfy demand,
prices for wholesale electricity are highly correlated to the price of natural gas. The chart below
illustrates the correlation between natural gas prices and wholesale electricity prices between
2007 and the beginning of 2014:

122. There are essentially six classes of generation assets in the ERCOT market:
(i) renewable generation (including wind, hydro-electric, and solar generation); (ii) nuclear;

57

(iii) lignite/coal; (iv) combined-cycle gas turbines (CCGTs), which are more efficient natural
gas units; (v) other natural gas and oil assets; and (vi) internal combustion assets. As demand
for electricity increases or decreases, ERCOT dispatches its assets in ascending order based on
cost to generate each marginal MW of electricity. That cost is generally approximated by a
units fuel expense.
123. Generally, in the ERCOT market, when natural gas prices are high, the cost to
generate electricity using natural gas-fueled units is high. These natural gas-fueled units
generally set the cost for wholesale electricity in the ERCOT market because they normally
satisfy the marginal demand for electricity. As a result, high natural gas prices generally lead to
high wholesale electricity prices. Lignite/coal and nuclear-fueled units have the ability to benefit
from these increases in wholesale electricity prices: the variable cost to produce electricity using
these units are not directly affected by changes in natural gas prices, and the electricity generated
by lignite/coal and nuclear-fueled units can be sold for the higher wholesale prices set by natural
gas-fueled plants. Importantly, however, lignite/coal and nuclear units have high start-up costs
relative to natural gas units and require longer notice or lead time to start. As a result,
lignite/coal units may run at a loss when wholesale electricity prices are low.
124. Natural gas units, by contrast, typically have lower start-up costs and generation
can be substantially increased or decreased in a relatively short period of time. As a result,
natural gas units are more likely to be shut down when wholesale electricity prices are below the
natural gas units cost to produce electricity. Importantly, when natural gas prices are relatively
low, the cost of producing electricity from CCGTs may drop below the cost of producing
electricity from lignite/coal units. When this occurs, these CCGTswhich Luminant does not
owncan displace lignite/coal units, including certain of Luminants lignite/coal units, at lower

58

levels of demand, and exacerbate the effect low natural gas prices have on the profitability of
those lignite/coal units. This is a market function known as coal to gas switching.
125. These factors reflect a key economic driver for the Debtors: high natural gas
prices contribute to high wholesale electricity prices and higher profitability for Luminants
entire electricity generation fleet, particularly its lignite/coal and nuclear-fueled units. By
contrast, declines in natural gas prices result in lower wholesale electricity prices, increased coal-
to-gas switching, lower generation from lignite/coal units, and lower profitability for Luminants
entire electricity generation fleet. As discussed below, market conditions and technological
innovations led to such a decline following the 2007 Acquisitionand that decline has had a
substantial negative effect on the results of TCEHs business operations, even after accounting
for TCEHs natural gas hedging program.
2. The Precipitous Drop in Natural Gas Prices Resulting From the
Development of Unconventional Natural Gas.
126. When the 2007 Acquisition closed, market conditions, including forward natural
gas prices, indicated that EFH would be able to service, repay, and refinance its 2007
Acquisition-related debt and generate positive returns for the EFH Equity Owners and their
co-investors. As discussed below, however, a precipitous and prolonged decline in natural gas
prices that resulted from increased exploitation and production of unconventional natural gas
fundamentally altered market conditions not just for EFH, but for the United States and global
energy industry as a whole.
127. The increased exploitation and development of unconventional natural gas largely
results from the development of a process known as hydraulic fracturing (widely known as
fracking). Unconventional natural gas rests 5,000 to 15,000 feet below the surface, trapped
within shale rock and tight sand formations. Geologists have long known that the United States

59

has access to the worlds largest concentration of natural gas, but until the development of
fracking, much of that gas could not be economically extracted. At its core, the fracking process
is simple. Engineers crack open the shale rock holding the gas by pumping highly-pressurized
fluid into the rock, allowing the gas to escape. When the well is de-pressurized, the gaswhich
is higher-pressure than the fluids used to break the rock apartflows to the surface.
128. Both technological limitations and federal law limited early attempts to capitalize
on fracking. For example, for effective fracking, the cracks in the shale rock must be maintained
by a high amount of pressure. Early processes did not maintain pressure long enough to enable
the gas to escape, and picking a spot for new drilling was little better than guesswork because of
limitations on underground imaging technology. Moreover, fracking was essentially banned by
the Safe Drinking Water Act, which imposed strict requirements on the injection of industrial
chemicals into the ground. In 2005, however, Congressciting a 2004 EPA study indicating
that the process is safelifted the fracking ban.
129. Between 2005 and 2008, natural gas prices continued to increase. The prolonged,
substantial decreases in natural gas prices that later occurred as a result of fracking were not
anticipated at the time of the 2007 Acquisition because of, among other things, technological
barriers, environmental concerns, expected increases in natural gas exports, and expected
decreases in production to offset decreases in price. Contrary to expectations at the time of the
2007 Acquisition, however, the technological barriers were overcome. Lubricating agents were
developed that allowed for cheaper injection of fluid at higher pressures and chemical mixtures
were developed that maintained the cracks in the shale rock for longer periods of time. Seismic
imaging technology produced greater certainty about the location of wells. Horizontal drilling
advancements allowed for the increase of the drillable size of each well.

60

130. Together, these advances decreased costs and increased yield, making the process
immensely profitable and leading to a dramatic increase in available natural gas reserves, as
demonstrated by the following map:

131. These improvements in the fracking process led to a dramatic increase in natural
gas production in the United States since 2008, even as gross withdrawals from traditional
sources of natural gas declined:
51

51
Source-by-source information for natural gas production is not available from the EIA for 2013.

61

132. These unexpected increases in natural gas production caused natural gas prices to
fall to as low as $2.04 per MMBtu in April 2012the lowest price since February 2002and
natural gas prices have generally stayed in the range of $2.50$4.80 per MMBtu since then, with
the exception of certain weather-driven events. Although the extremely cold weather throughout
most of the country in the fall and winter of 2013/2014 contributed to significant natural gas
price increasescausing short-term prices to reach as high as $6.15 per MMBtu on February 19,
2014, for March 2014 deliveryshort-term prices have already declined significantly from those
highs. And even those higher, weather-related short-term natural gas prices are below the natural
gas prices that prevailed at the time of the 2007 Acquisition. Longer-term natural gas prices
were not significantly influenced by those increases in short-term prices.
3. The Effect of Low Natural Gas Prices on EFH.
133. The prolonged, significant decline in natural gas prices has significantly
decreased the profitability of TCEHs lignite/coal and nuclear-fueled units. These market
conditions have resulted in significant declines in TCEHs revenues that have not been entirely

62

offset by TCEHs natural gas hedging program, and by the end of 2014, the remaining favorable
natural gas hedges will mature. The consequences to the profitability of TCEHs units have been
significant: declining natural gas prices, increased competition from more economic generation
assets (including renewable generation and more efficient natural gas-fueled technology), along
with other macroeconomic drivers, resulted in significant declines in revenues and the
recognition of impairments to TCEHs goodwill intangible asset balance of $1.0 billion in 2013,
$1.2 billion in 2012, and $4.1 billion in 2010.
52

134. In response to these economic conditions, Luminant has reduced the amount of
time that certain lignite/coal-fueled units, that are comparatively more expensive to operate,
generate electricity in order to reduce the amount of electricity generated uneconomically. These
reductions generally take one of two forms. Luminant may temporarily cease electricity
generation at certain lignite/coal units for short periods of time when the demand for electricity
and wholesale electricity prices in the ERCOT market are comparatively low. The units resume
operation when demand for electricity, and wholesale electricity prices, are comparatively high.
Alternatively, certain units may be operated on a seasonal basis in response to sustained periods
of comparatively low wholesale electricity prices and demand for electricity. Indeed, Luminant
has sought and received permission in the past to operate two of its lignite/coal units at
Monticello, along with one unit at Martin Lake, on a seasonal basis, and Luminant anticipates
that it will continue to operate these units on a seasonal basis going forward. In 2013 and 2012,
the estimated effects of these generation reductions of lignite/coal-fueled units totaled
approximately 12,460 GWh and 10,410 GWh of lowered electricity output, respectively.

52
TCEH also recorded an $8 billion goodwill impairment in 2008. That impairment, however, was largely
unrelated to TCEHs performance or the value of its assets. Instead, that impairment was due primarily to the
financial crisis/economic recession in 2008 that dramatically increased discount rates; Oncor recorded a
goodwill impairment of approximately $860 million in the same year.

63

135. TCEHs long-term natural gas hedges, which were put in place in 2006, 2007, and
2008, largely matured by 2013, and the remainder either already has, or will mature in 2014.
These maturities have already, and will continue to, exacerbate the TCEH Debtors balance
sheet-related challenges. As of April 30, 2008, TCEH had hedged approximately 85% of its
20092013 expected natural gas price exposure associated with its expected nuclear, coal, and
lignite generation, with natural gas positions at average prices ranging from $7.25 per MMBtu to
$8.26 per MMBtu. Further, most of the hedging transactions were secured with a first lien
interest in TCEHs assets, which eliminated normal collateral posting requirements for those
wholesale hedging transactions and associated effects on liquidity.
136. As of December 31, 2013, approximately 95% of TCEHs exposure to natural gas
prices in 2014 was hedged. Of that amount, however, only approximately 30% is attributable to
TCEHs historical natural gas price hedging program, primarily consisting of financial options
that effectively lock in the price of natural gas at approximately $7.80 - $11.75 per MMBtu.
The options represent the final highly favorable positions that TCEH was able to enter into
before natural gas prices declined; lower forward natural gas prices and the associated effect on
TCEHs financial condition precluded entry into hedges on similar terms for the remainder of
2014 exposure and beyond. The remainder of TCEHs natural gas exposure for 2014 is hedged
with either forward sales of electricity or other natural gas hedges. These forward sales or other
natural gas hedges are at prices that are closer to current market prices of natural gas, versus the
favorable prices of the hedges that were executed in 2006, 2007, and 2008. As a result, TCEH is
experiencing significantly greater exposure to lower natural gas prices and correspondingly

64

lower wholesale electricity prices, and will continue to be exposed to these pressures going
forward.
53

E. Other Market Conditions Affecting TCEHs Performance.
137. In addition to lower wholesale electricity prices resulting from low natural gas
prices, TCEHs financial performance has also been affected by other market and regulatory
considerations.
138. First, TCEHs financial difficulties resulting from the effect of low natural gas
prices are punctuated by TCEHs significant exposure to the uncertain costs of environmental
litigation and regulation, including both air quality and global climate change regulation. TCEH
incurred more than $600 million of environmental capital expenditures from 2010 through 2013,
and additional such expenditures are expected to total nearly $450 million from 2014 through
2020. That amount could be subject to material increases depending upon any new
environmental regulations.
139. Examples of environmental regulation and litigation-related expenses include
regulations and litigation related to air quality standards under the Clean Air Act, including the
much-litigated Cross-State Air Pollution Rule that was heard by the Supreme Court of the United
States in December 2013, litigation and regulation related to the byproducts of electricity
generation, and steps to address greenhouse gas emissions. Each of these categories of
regulation and litigation, along with others, impose cost and uncertainty on TCEHs business
operations.
140. Second, the cost of delivered coal has increased since the 2007 Acquisition for
four reasons: (a) increases in the price of Powder River Basin Coal, which is used to fuel several

53
The TCEH Debtors have sought the authority to take steps to preserve these positions and otherwise continue
their hedging activities on a postpetition basis pursuant to the Hedging and Trading Agreements Motion.

65

of the Debtors coal-fueled units (b) higher rail transportation costs; (c) the addition of rail fuel
surcharges to certain agreements; and (d) inflation. These increases in the cost of delivered
Powder River Basin coal increase the cost of operating Luminants lignite/coal-fueled units and,
consequently, reduce overall profits.
141. Third, electricity demand is driven, in part, by general macroeconomic
conditions. The economic recession in 2008/2009 had a negative effect on the demand for
electricity, as illustrated by the following chart:
54

142. Fourth, following the deregulation of the Texas electricity market, a significant
number of REPs entered the retail electricity market. As is the case in most competitive markets,
certain of these REPs have been willing to offer products with prices that are low enough to draw
away customers from other REPs, including TXU Energy, that focus on maintaining a higher
level of customer service and a broader variety of technological and other offerings. Retail
market restructuring in the ERCOT market was designed to encourage customers to shop for
alternatives to incumbent REPs such as TXU Energy that are associated with pre-deregulation
utilities. As a result of this fierce competition, TXU Energy, along with many other Texas REPs,
has experienced customer attrition.

54
Based on an ERCOT long-term forecast as of May 8, 2007.
250,000,000
270,000,000
290,000,000
310,000,000
330,000,000
350,000,000
370,000,000
2007 2008 2009 2010 2011 2012 2013
M
W
h
Forecast Demand
Actual Demand

66

143. Fifth, developments, and associated tax incentives for, renewable energy sources
like wind power have increased the supply of electricity derived from such sources. A key driver
of increased wind generation has been the competitive renewable energy zone program, which is
designed to facilitate the transmission of electricity generated in west Texas and the Texas
panhandle to the load centers located in major metropolitan areas. Indeed, according to ERCOT,
wind capacity in the ERCOT market has increased from approximately 3,426 MW in the
summer of 2007 to approximately 10,570 MW in the summer of 2013an increase of 208.5%.
Similarly, actual wind production increased from approximately 8,800 GWh in 2007 to
approximately 32,700 GWh in 2013an increase of approximately 271.6%. After capital costs
are invested, wind power is essentially free to generate: the fuel source (wind) is free, and, for
each MWh of electricity generated, wind generators benefit from governmental incentives like
production tax credits and renewable energy credits regardless of the wholesale price of
electricity in the ERCOT market. These increases in wind generation can increase the amount of
time Luminants lignite/coal-fueled units operate unprofitably and at lower output than design.
F. EFHs Financial Outlook and Business Strategy Going Forward.
144. The Debtors balance sheet is unsustainable given expected market conditions.
Once the Debtors balance sheet problems are addressed, however, EFH will be poised to
leverage its core operations, sales and customer service expertise, and shared services skills to
take advantage of possible growth opportunities. Demand for electricity in the ERCOT market is
forecasted to grow at a compound annual growth rate of 1.3% from 2014 to 2022, resulting in the
potential need to build generation resources in the ERCOT market. Additionally, the Debtors
fundamental business operations are strong notwithstanding the downward pressure placed on
wholesale electricity prices by low natural gas prices and high levels of competition. Once the

67

Debtors balance sheet is de-levered, the Debtors expect that they will be able to operate their
businesses profitably and aggressively pursue opportunities as they arise.
G. EFHs Reorganization Efforts.
145. Following the 2007 Acquisition and the subsequent decline in market conditions
and increase in environmental costs, EFH took a number of steps to maximize the value of the
business. As discussed below, those efforts resulted in significant successes.
1. EFH Implements Financial Transactions.
146. Since the 2007 Acquisition, EFH has executed several transactions to reduce or
extend its debt obligations, reduce cash interest payments, eliminate significant contingent
liabilities, and maximize the value of EFH, as discussed below.
a. The Liability Management Program.
147. In October 2009, the Debtors initiated a Liability Management Program focused
on improving the Debtors balance sheets by reducing debt and cash interest payments and
extending debt maturities through debt exchanges, repurchases, and issuances. Since its
inception, the Liability Management Program has captured approximately $2.5 billion in debt
discount, including approximately $700 million of debt discount at TCEH, by acquiring
approximately $12.57 billion in debt in exchange for approximately $10.04 billion of new debt
and/or cash (including cash funded by debt issuances).
148. Additionally, through the liability management program, EFH has amended and
extended approximately $25.7 billion of debt maturities to 2017-2021. The original maturities
ranged from 2013 (in the case of certain amounts under the TCEH Credit Agreement, as
discussed below) to 2017 (in the case of certain notes issued in connection with the 2007
Acquisition). Additionally, certain debt exchanges and repurchases involved debt issued in
earlier Liability Management Program transactions that had maturity dates in 2019 and 2020.

68

149. Amendments to the TCEH Credit Agreement completed in April 2011 and
January 2013 resulted in the extension of $16.4 billion in loan maturities to 2017 and the
extension of $2.05 billion of commitments under the revolving credit facility to 2016.
55
In
connection with the April 2011 amendment, approximately $1.623 billion of claims under the
TCEH Credit Agreement were repaid using $1.604 billion of net proceeds from issuing the
TCEH First Lien Notes (the remainder was sourced from cash on hand). The April 2011
amendment also included an amendment to certain of the TCEH Credit Agreements financial
covenants that allowed the TCEH Debtors to avoid triggering an event of default.
150. EFH also attempted to segregate the credit risk of EFH Corp., EFIH, and
EFCH/TCEH. EFH attempted to accomplish this goal through a combination of the exchanges
discussed abovemany of which resulted in the elimination of EFH Corp. debt that was
guaranteed by both EFCH and EFIHand issuing EFIH Second Lien Notes to fund the
repayment of intercompany demand notes from TCEH to EFH Corp. that were guaranteed by
EFIH. This effort was driven, in part, by an effort to reduce the cost of capital at EFH Corp. and
EFIH that would result from isolating EFH Corp. and EFIH from TCEHs credit risk, preserve
EFIHs access to the credit markets, and settle the payment obligations of EFH Corp. and EFIH
to TCEH in an efficient and orderly manner prior to TCEH needing cash to continue operations
and demanding payment in full of all amounts outstanding under the intercompany demand
notes. Additionally, isolating EFH Corp. and EFIH from TCEHs credit risk was part of EFHs
strategy to pursue a consolidated restructuring transaction.

55
Additional amendments were made to the TCEH Credit Agreement in August 2009.

69

b. Tax Transactions.
151. In addition to the significant value generated through the Liability Management
Program, EFH also eliminated several large contingent tax liabilities. First, as a result of various
transactions over the years, including the 2007 Acquisition, EFH Corp. generated multi-billion
dollar deferred intercompany gain (DIG) and excess loss account (ELA) contingent tax
liabilities with respect to its equity interests in EFCH. Specifically, the equity interests in EFCH
held by EFH Corp. reflected an accumulated excess loss account of approximately $19 billion
and deferred intercompany gain of approximately $4 billion as a result of the 2007 Acquisition
and prior corporate transactions. EFH determined that certain restructuring transactions could
result in recognition of those amounts, resulting in significant taxable gain and tax liability.
152. To eliminate the risk of these significant tax liabilities, EFH Corp. sought and
obtained a private letter ruling from the IRS that allowed EFH Corp. to eliminate the DIG and
ELA without adverse tax consequences. The transaction was consummated on April 15, 2013.
153. It is important to note that while this transaction reduced certain potential tax
liabilities with respect to the TCEH Debtors, the transaction did not eliminate the
multi-billion-dollar tax burden associated with a potential taxable sale of the TCEH Debtors
assets or EFIHs direct and indirect equity interests in Oncor Holdings and Oncor, either through
a plan or through a section 363 sale.
154. Second, in March 2013, EFH and the IRS agreed on terms to resolve disputed tax
return adjustments related to the IRS audit for tax years 2003-2006, including most significantly
an adjustment relating to an accounting-method issue (as well as other less significant issues).
This settlement allowed EFH to eliminate approximately $922 million of potential liability for
uncertain tax positions while avoiding material cash liability payable to the IRS.

70

c. Restructuring of the Debtors Long-Term Employee Pension
Obligations.
155. EFH also modified its pension plan in 2012 to provide greater certainty regarding
future costs.
56
The modifications resulted in:
splitting off assets and liabilities under the plan associated with employees of Oncor
and all retirees and terminated vested participants of EFH (including discontinued
businesses) to a new plan sponsored and administered by Oncor;
splitting off assets and liabilities under the plan associated with active employees of
the Debtors, other than bargaining unit employees, to a terminating plan, freezing
benefits, and vesting all accrued plan benefits for such pension participants;
terminating, distributing benefits under, and settling all of EFHs liabilities under the
terminating plan, resulting in a reduction in annual pension expense by approximately
$40 million, mostly for the Debtors; and
maintaining the plan associated with TCEHs bargaining unit employees.
2. Restructuring Negotiations.
156. Despite EFHs successful operational and restructuring initiatives since the 2007
Acquisition, the prepetition capital structure of EFH Corp., EFIH, and the TCEH Debtors cannot
be supported by prevailing market realities, so their capital structure must be delevered.
Accordingly, the Debtors commenced restructuring discussions and retained restructuring
advisors in July 2012 in an effort to develop a consensual restructuring framework that would
maximize the value of the Debtors estates. These restructuring negotiations involved highly
diverse stakeholders with varying goals and viewpoints and eventually grew to involve nearly
every aspect of the Debtors capital structure. Membership in the Debtors various ad hoc
stakeholder groups has shifted over time. Importantly, however, there is a consenting group of
creditors at each of EFH Corp., TCEH, and EFIH, which lays the groundwork for a prearranged
plan. Indeed, the majority of the Debtors stakeholders are either consenting to or being paid in

56
These modifications did not affect EFHs other post-employment benefit (OPEB) obligations.

71

full and in cash under the Global Restructuring. The following table shows certain members of
the various ad hoc groups over time and as of the Petition Date, including those groups with
members that have executed the Restructuring Support Agreement (the Restructuring Support
Parties):
57

Constituency Principals Advisors
Restructuring Support Parties
Approximately $9.9 billion, or 41%,
of the TCEH First Lien Debt
Apollo, Oaktree, Centerbridge,
Mason Capital, Fortress,
Och-Ziff, and Franklin
Paul Weiss, Millstein
Approximately $1.2 billion, or 76%,
of the EFIH Unsecured Notes

Certain members also hold
approximately $116 million, or 5%
of EFIH Second Lien Notes
Avenue Capital, GSO, PSAM,
Third Avenue, and York
Capital.
Akin Gump, Centerview
Partners
Approximately $471 million, or
73%, of the EFH Unsecured Notes
held by parties other than EFIH

Approximately $437 million, or 11%
of the EFIH First Lien Notes

Approximately $644 million, or 30%
of EFIH Second Lien Notes

Also holds an undisclosed amount of
TCEH First Lien Debt

Fidelity Fried Frank, Perella Weinberg
EFIH First Lien Notes

Holds approximately $769 million,
or 19%, of the EFIH First Lien
Notes
PIMCO Bingham McCutchen
EFH Equity Owners KKR, TPG, and Goldman
Sachs.
Wachtell Lipton, Blackstone
Groups Not Supporting the Restructuring Support Agreement
TCEH Second Lien Notes

Arrowgrass Capital, Appaloosa
Management, and Marathon
Asset Management.
Brown Rudnick, Peter J.
Solomon

57
In certain instances, principals reflected here may have subsequently sold their positions, and this chart is not
necessarily a comprehensive list of the principals in applicable groups.

72

Constituency Principals Advisors
TCEH Unsecured Notes

BlueCrest, Claren Road, Cyrus
Capital, Deutsche Bank AG,
DO S1 Limited, Fairway Fund
Limited, Fore, J.P. Morgan
Securities LLC, LMA SPC, and
Pine River.
White & Case, Houlihan Lokey
EFIH First Lien Notes

Davidson Kempner, WAMCO,
Blue Mountain, Cyrus Capital,
JP Morgan.
Ropes & Gray, Capstone
Advisors
EFIH Second Lien Notes

Anchorage Capital, Cyrus
Capital, Magnetar Financial,
Oak Hill Advisors, Taconic, and
Morgan Stanley.
Kramer Levin, Rothschild

157. In addition to those key stakeholders, the Debtors also engaged in significant
discussions with certain of their regulators and additional stakeholders, including the PUC,
ERCOT, the Debtors unions, the RCT, the NRC, the FERC, the IRS, and Oncor.
158. Two key issues dominated prepetition negotiations. First, there was significant
tension between whether the Debtors will be restructured on a consolidated basis that would
maintain EFHs current corporate form, or on a deconsolidated basis that would separate EFIH
(and Oncor) from TCEH. Second, any deconsolidated restructuring could either be on a
tax-efficient basis, which would avoid triggering in excess of $6 billion in deconsolidation-
related tax liability, or a taxable basis, which would potentially deliver a step-up in tax basis to
certain of the Debtors new owners.
159. The Debtors initial preference was to achieve a consensual, consolidated
reorganization. There were advantages to such an outcome: EFHs current corporate form
offers cost synergies, there would be no risk of triggering deconsolidation-related tax liabilities,
and potential disruption to EFHs businesses would be minimized. Under a consolidated
framework, however, a significant portion of EFIH, TCEH, and potentially EFH Corp. debt
would have been converted into EFH Corp. equity, necessitating a need for a high degree of
consensus among multiple creditor groups with claims to distinct asset classes.

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160. With that goal in mind, the Debtors engaged in nearly a year of negotiations with
their stakeholders in an effort to bridge fundamental differences in opinion regarding the relative
value of TCEH, on one hand, and EFIH (as reflected by its indirect 80% ownership of Oncor), on
the other hand, along with various other issuessuch as the amount and kind, if any, of recovery
that would be received by EFH Corp.s stakeholders in a consolidated framework. Public
disclosures of the status of these negotiations were required by the terms of principals
non-disclosure agreements in April 2013 and October 2013. The Debtors explored various
transaction alternatives, including out-of-court exchange offers of EFIH and EFH Corp. debt
accompanied by a chapter 11 filing by TCEH.
161. Following public disclosures of the status of negotiations in October 2013 and a
$271 million interest payment that TCEH made to its junior creditors on November 1, 2013, it
became clear that a consolidated transaction was not possible because the Debtors and their
stakeholders were unable to bridge fundamental differences in opinion on valuation and tax-
related issues. As a result, the Debtors turned their attention to developing a deconsolidation
strategy.
162. The Debtors and their stakeholders focused on two potential deconsolidated
transactions. First, TCEHs and EFIHs assets could be sold in a taxable transaction under a
plan of reorganization or pursuant to a sale under section 363 of the Bankruptcy Code. Such a
sale would potentially trigger in excess of $6 billion in deconsolidation-related tax liabilities, but
may deliver a step-up in tax basis to the new owners of TCEH and EFIH. Second, a tax-free,
or tax-efficient, transaction that triggers no or reduced deconsolidation-related tax liabilities, but
does not give the new owners of TCEH and EFIH a step-up in tax basis (or, in some cases,
gives the new owners of TCEH a partial step-up).

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163. Evaluation of these transactions is significantly complicated by the tax structure
of the Debtors. The substantial majority of the TCEH Debtors, as well as EFIH, are disregarded
entities for federal tax purposes. As a result, certain constituenciesparticularly the holders of
TCEH First Lien Debthave insisted that the majority of the entities composing TCEH and
EFIH (as disregarded entities) would not be liable for any deconsolidation-related tax liabilities.
Rather, such constituencies have argued that the taxpaying entities in EFHs consolidated tax
group (excluding Oncor)principally EFH Corp. and certain of EFH Corp.s subsidiaries other
than TCEH and EFIHare the only entities liable for any deconsolidation-related tax. Certain
creditors asserted that these considerations required that any deconsolidated transaction provide
for a step-up in the basis of TCEHs assets, even though there is a significant risk that little or
no tax liability would actually be paid. The Debtors, by contrast, were firmly of the view that the
significant litigation and regulatory risk related to triggering massive deconsolidation-related tax
liabilities that may be left impaired at EFH Corp. justified a focus on tax-free and tax-efficient
transactions.
164. Beginning in early 2014, the Debtors negotiation runway was rapidly coming to
an end. For a number of reasons, including dwindling liquidity and significant debt maturities in
October and November 2014, the Debtors expected to receive a qualified going concern audit
opinion in connection with its 2013 audit. That opinion, which would be disclosed in the
Debtors 2013 10-K filing with the SEC, would trigger an event of default under the TCEH
Credit Agreement following an applicable grace period. As a result, the TCEH Debtors faced an
impending chapter 11 filing. EFH Corp. and EFIH were expected to follow because of
significant liquidity constraints.

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165. Until early March, the Debtors appeared to be on a path to filing for chapter 11
without having obtained any consent regarding the terms of a restructuring or a potential
restructuring support agreement. Beginning in early 2014, Fidelity and certain holders of EFIH
Unsecured Notes began to coalesce around the terms of a consensual restructuring, including an
infusion of new capital at EFIH and EFH Corp. Notably, the EFH Equity Owners and their
advisors played a vital role in those negotiations and were instrumental in bringing the parties to
the table. Those conversations, however, were premised on a TCEH Tax-Free Spin, and holders
of TCEH First Lien Debt were unwilling to consider such a transaction because it did not provide
a step-up in tax basis. That all changed, however, in March 2014, when certain holders of
TCEH First Lien Debt indicated a willingness to consider a TCEH Tax-Free Spin as long the
transaction could be executed quickly and certain other conditions could be satisfied.
166. These developments completely changed the tone of negotiations and, for the first
time, opened a window to a consensual solution. As a result, the Debtors and their
stakeholdersincluding the EFH Equity Owners, who played a significant roleentered into an
intense period of negotiations to negotiate and document a transaction based on the TCEH Tax-
Free Spin and Investment Commitment. To facilitate these negotiations, the TCEH Debtors
elected not to make certain interest payments due on April 1, delayed making their public filings,
and entered into a month-long grace period. These negotiations were ultimately successful, and,
in the last days before events of default would have forced the Debtors into a traditional
chapter 11 filing, the Restructuring Support Parties executed the Restructuring Support
Agreement.
3. The Restructuring Support Agreement.
167. The Restructuring Support Agreement represents a landmark settlement that
either has the support of each of the Debtors most important stakeholders or pays them in full in

76

cash.
58
While the Debtors will be deconsolidateda result the Debtors sought to avoidthe
deconsolidation will avoid triggering deconsolidation-related tax liabilities and will allow the
Debtors to emerge from chapter 11 quickly. Nearly two years of preparation, and over one year
of hard-fought negotiations, have gone into inking the Restructuring Support Agreement.
Accordingly, the Debtors and the Restructuring Support Parties believe that the Global
Restructuring embodied in the Restructuring Support Agreement maximizes the value of all of
the Debtors estates.
168. The Global Restructuring has two key pieces. First, the TCEH will be spun off
from EFH Corp. in the TCEH Tax-Free Spin. Second, EFIH and EFH Corp. will be significantly
recapitalized.
a. TCEH Tax-Free Spin.
169. Under the TCEH Tax-Free Spin, the TCEH Debtors current first lien creditors
will receive 100% of the equity in reorganized TCEH LLC. Additionally, an important part of
the TCEH Tax-Free Spin is to provide a partial step-up in the tax basis in TCEHs assets by
using the Debtors accumulated tax attributes. This partial step-up, which provides significant
value to the holders of TCEH First Lien Debt, is a vital aspect of the consideration being
received by the TCEH Debtors first lien creditorswithout the partial step up, the Debtors
may not have been able to reach a deal on the terms of the transaction. The TCEH Tax-Free
Spin will be conditioned on the receipt of a private letter ruling from the IRS that confirms,
among other things, the tax-free nature of the TCEH Tax-Free Spin, and the execution by the

58
The Restructuring Support Agreement and the various settlements it embodies are discussed in more detail in
motions that the Debtors will file to authorize the assumption of the Restructuring Support Agreement (the
RSA Assumption Motion) and the approval of certain settlements (the Settlement Motion), either of which
will be filed on or shortly following the Petition Date.

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Debtors of a tax matters agreement to protect the status of the transaction post-emergence.
Finally, certain subsidiaries of EFH Corp. will transfer operating assets to TCEH.
170. The TCEH Debtors will issue new debt in an amount to be determined to fund the
repayment of the TCEH DIP Facility and fund cash payments to the TCEH Debtors
stakeholders. Holders of unsecured and second lien claims against the TCEH Debtors will
receive their pro rata share of the cash value of the TCEH Debtors unencumbered assets.
b. EFIH/EFH Corp. Recapitalization.
171. The lynchpin of the recapitalization of EFIH and EFH Corp. is the $1.9 billion
Investment Commitment that is backstopped by certain holders of EFIH Unsecured Notes (the
Initial Commitment Parties and, together with certain Selected Partners, the Commitment
Parties). Under the Investment Commitment, which is described in more detail in the
Settlement Motion, the Commitment Parties and any other parties that elect to exercise their
participation rights will inject $1.9 billion of cash into EFIH. This Investment Commitment will
initially take the form of a second lien DIP facility (the EFIH Second Lien DIP Facility) that
will mandatorily convert into approximately 65% of equity in reorganized EFH Corp.
59
Holders
of EFIH Unsecured Notes and EFH Unsecured Notes have participation rights in the Investment
Commitment (91% and 9%,
60
respectively, subject, in the case of the participation rights held by
holders of EFIH Unsecured Notes, to pro rata reduction by certain investing partners selected by
the Initial Commitment Parties). The Investment Commitment will be supported by the
amending of the Oncor TSA (the Oncor TSA Amendment) to provide that Oncor will make

59
The percent conversion will change based on the amount outstanding under the EFIH Second Lien DIP
Financing on the effective date of the plan.
60
Only Fidelity has participation rights with respect to funding the EFIH Second Lien DIP Financing. Other
holders of EFH Unsecured Notes who elect to participate in the Investment Commitment will do so pursuant to
a rights offering under the plan, the proceeds of which will be used to repay Fidelitys portion of the EFIH
Second Lien DIP Financing.

78

payments directly to EFIH, rather than EFH Corp. Each of EFIHs DIP facilities will be secured
by the new revenue attributable to the Oncor TSA Amendment.
172. The EFIH Second Lien DIP Facility, together with the EFIH First Lien DIP
Facility, will be used to repay the EFIH Second Lien Notes and the EFIH First Lien Notes (the
EFIH Second Lien Refinancing and the EFIH First Lien Refinancing, respectively, and
together, the EFIH Secured Refinancings). The EFIH First Lien Refinancing will save EFIH
approximately $13 million per month in interest expense. The EFIH Second Lien Refinancing
will save interest expense and, more importantly, simultaneously deleverage EFH Corp. and
EFIH while providing significant value to unsecured creditors.
173. Although the EFIH Secured Refinancings will allow for a significant deleveraging
of EFIH, certain holders of EFIH First Lien Notes and EFIH Second Lien Notes believe that they
are entitled to so-called makewhole claims (the EFIH First Lien Makewhole Claims and
EFIH Second Lien Makewhole Claims, respectively, and together, the EFIH Makewhole
Claims). The stakes are significant: the EFIH First Lien Makewhole Claims and the EFIH
Second Lien Makewhole Claims each total over $700 million, respectively. EFIH is taking a
dual-pronged approach to the EFIH Makewhole Claims.
174. First, as described in greater detail in the Settlement Motion, EFIH has offered to
settle all outstanding obligations under the EFIH First Lien Notes, including EFIH First Lien
Makewhole Claims, for approximately $105 (plus accrued but unpaid interest) of roll-up notes
under the EFIH First Lien DIP Facility for every $100 of EFIH First Lien Notes tendered into the
settlement (the EFIH First Lien Settlement). Fidelity and PIMCO have agreed to participate in
the EFIH First Lien Settlement.

79

175. Additionally, EFIH has offered to settle all outstanding obligations under the
EFIH Second Lien Notes, including EFIH Second Lien Makewhole Claims, for a cash payment
equal to principal and accrued interest plus a pro rata share of a cash payment equal to 50% of
the potential EFIH Second Lien Makewhole Claims (the EFIH Second Lien Settlement and,
together with the EFIH First Lien Settlement, the EFIH Makewhole Settlements). Fidelity will
have the option to receive up to $500 million of roll-up notes under the EFIH First Lien DIP
Financing, in addition to cash, under the EFIH Second Lien Settlement, while certain other
holders have agreed to receive claims under the EFIH Second Lien DIP Financing rather than
payment in cash in exchange for their claims. All holders of EFIH First Lien Notes and EFIH
Second Lien Notes will be given the opportunity to participate in the EFIH Makewhole
Settlements pursuant to two tender offers that will be launched shortly after the Petition Date.
Fidelity has agreed to participate.
176. Second, with respect to holdout secured creditors, EFIH will execute the EFIH
Secured Refinancings on a non-consensual basis and will litigate the EFIH Makewhole Claims.
The EFIH First Lien DIP Motion, filed contemporaneously herewith, seeks to disallow the EFIH
First Lien Makewhole Claims. EFIH will also seek to disallow the EFIH Second Lien
Makewhole Claims, to the extent any creditors assert such claims.
177. In addition to their rights under those transactions, EFIH unsecured creditors will
receive approximately 35% of the equity in reorganized EFH Corp. (after accounting for dilution
by the Equity Conversion). EFH Corp.s unsecured creditors will receive any cash remaining at
EFH Corp. at the end of the case, a cash payment from EFIH of up to $55 million, and a small
distribution of equity in reorganized EFH Corp.

80

c. Case Milestones.
178. As described in more detail in the Settlement Motion and the RSA Assumption
Motion, the Restructuring Support Agreement, the Investment Commitment, and the terms of the
EFIH Second Lien DIP Facility each contain certain case milestones. The goal of the Debtors
and their stakeholders are to resolve these chapter 11 cases as expeditiously as possible.
Notably, the Debtors are poised to exit chapter 11 within a year. To accomplish that goal, the
Debtors will file a plan and disclosure within 45 days of the Petition Date and will aim to have a
disclosure statement order entered within 105 days of the Petition Date. From there, the Debtors
will seek entry of the confirmation order within 275 days of the Petition Date, and will seek to
emerge from chapter 11 within 305 days of the Petition Date. Additionally, the EFIH Debtors
will seek to effectuate the EFIH First Lien Refinancing and the EFIH Second Lien Refinancing
within 75 days of the Petition Date.
4. The Debtors Commence the Chapter 11 Cases.
179. The Debtors commenced these chapter 11 cases to begin the process of
implementing the Global Restructuring as memorialized in the Restructuring Support
Agreement. Although there is no question that there are significant issues to resolve even in the
consensual framework the Debtors have achieved, the Debtors are confident that these chapter 11
cases will provide the framework to maximize the value of the Debtors estates for all of their
stakeholders. In the meantime, the principal focus of the Debtors will remain on Job 1:
operating their businesses in a way that preserves value, protects jobs, and satisfies their
regulatory operations.

81

Part III.
Overview of First Day Relief
180. The Debtors have filed a number of First Day Motions, customary in large chapter
11 cases such as these, designed to minimize the adverse effects of the commencement of the
chapter 11 cases on their ongoing business operations. I believe that court approval of the relief
requested in the First Day Motions is essential to providing the Debtors with an opportunity to
successfully meet their obligations by maintaining baseline operations, providing for a smooth
transition into the chapter 11 cases, and minimizing any loss of value to the Debtors businesses.
181. The First Day Motions seek authority to, among other things, continue to pay
employee compensation and benefits in order to maintain morale and retention as the Debtors
transition into chapter 11, thus avoiding the potential for catastrophic brain drain; ensure the
continuation of the Debtors cash management systems and other business operations without
interruption, including the Debtors vital customer programs; provide the Debtors the ability to
pay certain critical trade vendors and certain other vendors who could assert liens against the
Debtors property and to provide adequate assurance of future performance to their utility
providers; provide the ability to maintain existing hedging and trading agreements and/or enter
into new agreements that play a vital role in the Debtors operations and cash flow by managing
the Debtors forward commodities exposure; and assume certain key contracts with ERCOT and
the regulated transmission and distribution utilities, including Oncor, that deliver the electricity
that is generated and sold by TCEH.
EXHIBIT A
Evidentiary Support for First Day Pleadings


TABLE OF CONTENTS
Page
Financing Motions .........................................................................................................................1
TCEH DIP Financing Motion. .............................................................................................1 I.
TCEH Cash Collateral Motion.............................................................................................5 II.
EFIH First Lien DIP Financing Motion. ..............................................................................7 III.
Cash Management Motion. ..................................................................................................9 IV.
Operational Motions ....................................................................................................................31
Wages Motion. ...................................................................................................................31 V.
Critical Vendors Motion. ...................................................................................................61 VI.
Shippers, Warehousemen, and Materialmen Motion. ........................................................70 VII.
Customer Programs Motion. ..............................................................................................73 VIII.
Hedging and Trading Motion.............................................................................................93 IX.
Taxes and Fees Motion. ...................................................................................................110 X.
Utilities Motion. ...............................................................................................................116 XI.
TDSPs Assumption Motion. ............................................................................................119 XII.
ERCOT Assumption Motion. ..........................................................................................128 XIII.
Procedural Motions ...................................................................................................................134
Joint Administration Motion. ...........................................................................................134 XIV.
Claims and Noticing Agent Motion. ................................................................................135 XV.
Consolidated Creditors List Motion.................................................................................135 XVI.
Retention Applications.....................................................................................................136 XVII.


EVIDENTIARY SUPPORT FOR FIRST DAY PLEADINGS
1

1. To minimize the adverse effects of the commencement of these chapter 11 cases
on their business, the Debtors have requested various types of relief in their First Day Pleadings.
The First Day Pleadings seek relief intended to allow the Debtors to effectively transition into
chapter 11 and minimize disruption to the Debtors operations caused by their bankruptcy filings,
thereby preserving the value of the Debtors estates for the benefit of their stakeholders. I am
familiar with the contents of each First Day Pleading (including the exhibits thereto), and I
believe that the relief sought in each First Day Pleading: (a) is necessary to enable the Debtors to
operate in chapter 11 with minimal disruption or loss of value; (b) is necessary to provide the
Debtors with a reasonable opportunity for a successful reorganization; and (c) best serves the
interests of the Debtors stakeholders. The following paragraphs describe the factual bases for
the relief requested in each of the First Day Pleadings.
Financing Motions
TCEH DIP Financing Motion.
2
I.
2. The TCEH Debtors request entry of an interim and final order, (a) authorizing the
TCEH Debtors to enter into the DIP Credit Agreement to obtain the DIP Financing, (b) granting
liens and providing superpriority administrative expense claims, (c) modifying the automatic
stay, and (d) scheduling a hearing to consider approval of the DIP Facility on a final basis.

1
Capitalized terms used in this exhibit and not otherwise defined shall have the meanings set forth in the
applicable First Day Pleading or in the First Day Declaration. Exhibit references are to the exhibits associated
with the respective First Day Pleadings.
2
See Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders (A) Approving
Postpetition Financing, (B) Granting Liens and Providing Superpriority Administrative Expense Claims, (C)
Granting Adequate Protection, (D) Modifying the Automatic Stay, and (E) Scheduling a Final Order, filed

2

3. I understand that the TCEH Debtors have negotiated and reached an agreement to
enter into, subject to approval of the court, a $4.475 billion secured superpriority postpetition
debtor in possession financing agreement. The DIP Agreement, dated April 28, 2014, is by and
among TCEH LLC as borrower, EFCH as Parent Guarantor, and each of TCEH LLCs direct
and indirect Debtor subsidiaries, as Guarantors, Citibank, N.A., as administrative agent and DIP
agent, Deutsche Bank AG New York Branch as Administrative Agent, and the lenders named
therein.
4. The TCEH Debtors with the assistance of their advisors developed a three-month
budget with the assistance of their advisors. I understand that the DIP Budget incorporates a
number of factors, including the effect of the chapter 11 filing, material cash disbursements,
required vendor/supplier payments, cash flows from the TCEH Debtors ongoing operations, and
the cost of necessary goods and materials, and includes all of the expenditures for which the
TCEH Debtors seek authority to pay in various first day pleadings.
5. I understand that the TCEH Debtors will use Cash Collateral to fund working
capital, capital expenditures, and other general corporate purposes; the TCEH Debtors believe
Cash Collateral will ultimately be insufficient. Therefore, the TCEH Debtors have determined
that postpetition financing is necessary to fund the following restructuring costs, among others:
adequate protection payments, working capital (e.g., collateral for letters of credit), bankruptcy
costs (e.g., business disruption and professional fees), and regulatory requirements (e.g., RCT
mining reclamation obligations). I understand that without the DIP Facility, the TCEH Debtors
may not have sufficient liquidity to continue their business in the ordinary course. Additionally,
I understand that if the TCEH Debtors are unable to demonstrate that they have the means to
operate in the ordinary course of business, customers may seek alternatives and vendors may

3

refuse to do business with the TCEH Debtors. Therefore, I believe that the TCEH Debtors have
an immediate need to access the DIP Facility; otherwise, the ultimate success of the TCEH
Debtors restructurings may be jeopardized.
6. As provided in the DIP Budget, the TCEH Debtors believe that approximately
$1,600,000,000 in available liquidity is necessary for operations during the interim period of
these chapter 11 cases. I understand that the proposed DIP Financing will provide the TCEH
Debtors with immediate access of up to $2,700,000,000, consisting of (a) $800,000,000 under
the Revolving Credit Facility, (b) $1,100,000,000 under the Delayed-Draw Term Facility, the
proceeds of which, if funded, subject to the condition set forth above, will be applied by TCEH
LLC to fund the RCT L/C Collateral Account, and (c) $800,000,000 under the Term Loan
Facility, of which up to $800,000,000 may be applied by TCEH LLC to fund the General L/C
Collateral Account. Moreover, upon entry of the Final Order, the proposed DIP Financing will
provide the TCEH Debtors with up to $4,475,000,000, consisting of (x) $1,950,000,000 under
the Revolving Credit Facility, (u) $1,425,000,000 under the Term Loan Facility, of which up to
$800,000,000 may be applied by TCEH LLC to fund the General L/C Collateral Account, and
(z) $1,100,000,000 under the Delayed Draw Term Facility, the proceeds of which, if funded,
subject to the condition set forth above, will be applied by TCEH LLC to fund the RCT L/C
Collateral Account to support RCT Letters of Credit.
7. I understand that the TCEH Debtors decision to proceed with the DIP Financing
comes after a dedicated and diligent search for the best financing alternatives as described in
greater detail in the Goldstein Declaration. I understand that in early September 2013, the TCEH
Debtors and Evercore initiated a request for DIP RFPs, where the TCEH Debtors approached
five large financial institutions that are actively involved in the debtor-in-possession and

4

syndicated finance markets. I understand that proposals were submitted in response to the TCEH
Debtors RFP and after substantial analysis, the TCEH Debtors concluded that no single
financial institution would be able to underwrite the entire amount of the DIP financing due to
the size of the proposed revolving credit facility. I understand that negotiations with financial
institutions continued through October and on October 25, 2013, the TCEH Debtors determined
that Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. proposed the best possible
combination of terms and effectively addressed the TCEH Debtors liquidity needs. I understand
that the TCEH Debtors thus began negotiating commitment letters with Citigroup Global
Markets Inc. and Deutsche Bank Securities Inc., as well as five other lenders, understanding that
the TCEH Debtors would require a broadly-syndicated facility to achieve a revolving credit
facility of this size.
8. I understand that the DIP Financing negotiations were renewed in early February
2014 using the initial discussions as a foundation. I also understand that negotiations with the
DIP Lenders continued through April 2014, replacing one of the original seven lenders and
culminating in the TCEH Debtors receiving signed commitment letters from all seven lenders on
April 28, 2014.
9. I understand that DIP Financing is the best source of financing, providing the
TCEH Debtors with the liquidity they need to continue operating their businesses in the ordinary
course and satisfy restructuring-related costs. I believe that the relief requested in the TCEH DIP
Motion is in the best interest of the TCEH Debtors estates, their creditors, and all other parties
in interest, and is necessary for the TCEH Debtors to continue to operate their businesses in
chapter 11 without disruption. Accordingly, on behalf of the TCEH Debtors, I believe that the
relief requested in the TCEH DIP Motion should be granted.

5

TCEH Cash Collateral Motion.
3
II.
10. In the TCEH Cash Collateral Motion, the TCEH Debtors seek entry of orders:
(a) authorizing the TCEH Debtors use of Cash Collateral (as defined in the Interim Order) of the
Prepetition Secured Agents and Prepetition Secured Creditors (each as defined in the Interim
Order) on an interim basis pending a final hearing on the TCEH Cash Collateral Motion (the
Final Hearing); (b) granting adequate protection to the Prepetition First Lien Agents and
Prepetition First Lien Creditors for any diminution in value of their respective interests in the
Prepetition Collateral (each as defined in the Interim Order), including the Cash Collateral;
(c) subject to entry of a Final Order and to the extent set forth herein, waiving the TCEH
Debtors right to surcharge the Prepetition Collateral pursuant to section 506(c) of the
Bankruptcy Code; (d) prescribing the form and manner of notice and setting the time for the
Final Hearing; (e) vacating or modifying the automatic stay imposed by section 362 of the
Bankruptcy Code to the extent necessary to permit the TCEH Debtors and the Prepetition
Secured Agents on behalf of the Prepetition First Lien Creditors to implement and effectuate the
terms and provisions of the Interim Order; (f) scheduling the Final Hearing to consider the relief
requested in the Motion and the entry of a Final Order, and approving the form of notice with
respect to the Final Hearing; and (g) granting related relief.
11. In the normal course of business, the TCEH Debtors use cash on hand and cash
flow from operations to fund working capital, capital expenditures, and for other general
corporate purposes. I understand that an inability to use these funds during these chapter 11
cases could cripple the TCEH Debtors business operations. Indeed, the TCEH Debtors must use

3
See Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders (A) Authorizing Use
of Cash Collateral, (B) Granting Adequate Protection, (C) Modifying the Automatic Stay, and (D) Scheduling a
Final Hearing, filed contemporaneously herewith.

6

their cash to, among other things, continue the operation of their business in an orderly manner,
maintain business relationships with vendors, suppliers, and customers, pay employees, fulfill
regulatory obligations, and satisfy other working capital and operational needsall of which are
necessary to preserve and maintain the TCEH Debtors going-concern value and, ultimately,
effectuate a successful reorganization.
12. To obtain consent for the use of Cash Collateral and the priming liens provided
for under the DIP Financing, the TCEH Debtors entered into negotiations with Paul, Weiss,
Rifkind, Wharton, and Garrison LLP, as counsel to an informal steering committee representing
holders of approximately 41% in amount of claims under the TCEH First Lien Credit Agreement
and TCEH First Lien Notes Indenture (the TCEH First Lien Ad Hoc Committee). After weeks
of these negotiations, the TCEH First Lien Ad Hoc Committee consented to both the priming
liens (and other terms provided) under the DIP Motion and the TCEH Debtors use of Cash
Collateral, in exchange for the TCEH Debtors providing adequate protection against any
diminution in value of the Prepetition First Lien Creditors interests in the Prepetition Collateral.
13. I understand that the TCEH Debtors will provide the Prepetition First Lien
Creditors with various forms of adequate protection, including, primarily: (a) the First Lien
Adequate Protection Payments; (b) the First Priority 507(b) Claim; (c) the First Priority
Adequate Protection Liens; (d) professional fees and expenses; (e) the Financial Covenant; and
(f) access to the TCEH Debtors books and records, including budgets and financial forecasts
(collectively, the Adequate Protection Obligations). The TCEH Debtors will also provide the
Prepetition Second Lien Creditors with: (a) the Second Priority 507(b) Claim and (b) the Second
Priority Adequate Protection Liens, in both cases junior in priority to those received by the

7

Prepetition First Lien Creditors, consistent with the terms of the Second Lien Intercreditor
Agreement.
14. Absent approval of the TCEH Cash Collateral Interim Order, the TCEH Debtors
would be effectively unable to generate revenue, operate their businesses, or pay the hundreds of
individuals who report to work each day. I believe the TCEH DIP Financing Motion is
appropriate and should be approved.
EFIH First Lien DIP Financing Motion.
4
III.
15. The EFIH Debtors request entry of (i) an interim order (the Interim Fee Order)
(a) approving certain fees as and to the extent required under the EFIH First Lien DIP
Commitment Letter relating to commitments to fund the EFIH First Lien DIP Financing and that
certain fee letter relating to the payment of fees in connection with the EFIH First Lien DIP
Financing (the EFIH First Lien DIP Fee Letter) and (b) scheduling a hearing to consider
approval of the relief requested in the Motion on a final basis and (ii) a final order (a) authorizing
the EFIH Debtors to enter into the EFIH First Lien DIP Credit Agreement to obtain the EFIH
First Lien DIP Financing, (b) granting liens and providing superpriority administrative expense
claims, (c) authorizing the use of EFIH Cash Collateral, (d) authorizing the EFIH First Lien
Refinancing, (e) authorizing the issuance of EFIH First Lien DIP Roll-Up Claims to the extent
provided in the Settlement Motion, (f) determining the value of the secured claims of the

4
See Motion of Energy Future Intermediate Holding Company LLC and EFIH Finance Inc., for Entry of for
Entry of (I) and Interim Order (A) Approving Certain Fees Related to Postpetition Financing and Granting
Such Fees Administrative Expense Priority and (B) Scheduling a Final Hearing; and (II) a Final Order
(A) Approving Postpetition Financing, (b) Granting Liens and Providing Superpriority Administrative Expense
Claims, (C) Authorizing the Use of Cash Collateral, (D) Authorizing the EFIH First Lien DIP Refinancing,
(E) Authorizing Issuance of Roll-Up Debt to the Extent Authorized by the Settlement Motion, (F) Determining
the Value of Secured Claims, and (G) Modifying the Automatic Stay (the EFIH First Lien DIP Motion), filed

8

Prepetition EFIH First Lien Creditors, including a determination that such amount does not
include any EFIH First Lien Makewhole Premium, and modifying the automatic stay.
16. I understand that the EFIH Debtors have negotiated and reached an agreement to
enter into, subject to approval of the court, a $5.4 billion secured superpriority postpetition
debtor in possession financing agreement. I understand that the EFIH Debtors remain in active
negotiations with all parties and will file the EFIH First Lien DIP Credit Agreement on or shortly
following the Petition Date. Further, I understand that the EFIH First Lien DIP Financing
consists of a single term loan, along with various roll-ups of prepetition secured creditors in
settlement of certain makewhole claims. Given the significant difference in interest rates
between the proposed EFIH First Lien DIP Credit Agreement, on one hand, a providing of-courI
understand that the EFIH Debtors contest validity of such claims. I understand that the EFIH
Debtors have determined that when comparing the costs and savings of the transaction, it is in
their best interest to execute the EFIH First Lien Refinancing as expeditiously as possible.
17. In light of imminent liquidity needs, I understand that with the assistance of their
advisors, the EFIH Debtors developed an initial three-month budget. According to the EFIH
Budget, the EFIH Debtors believe over $1 billion in liquidity is necessary to fund restructuring
costs, financing fees, and professional fees. I understand, however, that the EFIH Debtors need
not satisfy these costs during the interim period. As a result, I understand that the EFIH Debtors
are not seeking relief with respect to the EFIH First Lien DIP Financing Motion.

9

Cash Management Motion.
5
IV.
18. In the Cash Management Motion, the Debtors seek entry of an order authorizing,
but not directing, the Debtors to continue to operate an integrated cash management system (as
discussed in the Cash Management Motion, the Cash Management System) in the day-to-day
operation of their businesses, and to continue to honor certain prepetition obligations in
accordance with the operation of the Cash Management System. I understand that the diagram
attached to the Cash Management Motion as Exhibit B and incorporated by reference provides
an overview of the Cash Management System. Specifically, the Debtors request authority to:
(a) continue to use, with the same account numbers, each of the bank accounts held in the name
of a Debtor (the Bank Accounts) located at the financial institutions (collectively, the Banks)
listed on Exhibit C attached to the Cash Management Motion and incorporated in the Cash
Management Motion by reference; (b) treat the Bank Accounts for all purposes as accounts of
the Debtors as debtors in possession; and (c) conduct banking transactions by all usual means,
and debit the Bank Accounts on account of all usual items and payment instructions.
19. Additionally, the Debtors seek authority to: (a) use, in their present form, all
business forms (including check stock, letterhead, purchase orders, and invoices) and other
correspondence and documents related to the Bank Accounts, without reference to the Debtors
status as debtors in possession; (b) continue to use certain investment accounts in accordance
with section 345 of the Bankruptcy Code; (c) close existing Bank Accounts and open new
debtor-in-possession accounts with Authorized Depositories (as defined in the Cash Management
Motion); and (d) continue certain intercompany and netting arrangements between and among

5
See Motion of Energy Future Holdings Corp., et al., for Entry of an Order (A) Authorizing the Debtors to (I)
Continue Using Their Existing Cash Management System, (II) Maintain Existing Bank Accounts and Business
Forms, and (III) Continue Using Certain Investment Accounts; (B) Authorizing Continued Intercompany
Transactions and Netting of Intercompany Claims; and (C) Granting Postpetition Intercompany Claims
Administrative Expense Priority, filed contemporaneously herewith.

10

the Debtors and their Debtor and non-Debtor affiliates on an administrative priority basis in the
ordinary course of business and in accordance with historical practices (solely as described in the
Cash Management Motion, the Intercompany Transactions, and claims arising from the
Intercompany Transactions, the Intercompany Claims).
A. The Bank Accounts.
1. Overview.
20. I understand that the Cash Management System is composed of of 44 Bank
Accounts, each of which is held in the name of one the following Debtors: (a) EFH Corp.; (b)
EFIH; (c) EFH Corporate Services Company (EFH Corporate Services); (d) Generation
Development Company LLC; and (e) TXU Receivables Company LLC; (f) EFCH; and (g)
TCEH LLC and the following TCEH LLC subsidiaries: (i) Luminant Energy Company LLC
(Luminant Energy); (ii) Luminant Generation Company LLC (Luminant Generation);
(iii) Luminant Mining Company LLC (Luminant Mining); (iv) TXU Energy Retail Company
LLC (TXU Energy Retail); (v) TXU Energy Receivables Company LLC (TXU Energy
Receivables); and (vi) 4Change Energy Company (4Change Energy). The Cash Management
System is primarily managed by the Debtors financial personnel at their corporate headquarters
located in Dallas, Texas.
21. The Debtors primary Bank is J.P. Morgan Chase Bank (JPM), with which the
Debtors maintain 34 Bank Accounts. The Debtors also maintain 10 Bank Accounts with 7
Banks other than JPM. The Debtors maintain each of the Bank Accounts at financial institutions
insured by the Federal Deposit Insurance Corporation (the FDIC). Moreover, 43 of the Bank

11

Accounts are located at institutions that the Debtors believe are designated as authorized
depositories (the Authorized Depositories) by the U.S. Trustee.
6

22. I understand that the bulk of the Debtors cash on-hand as of the Petition Date is
from cash raised from debt issuances, distributions received from Oncor (in the case of EFH
Corp. and EFIH), and proceeds generated from ongoing business operations.
7
As of the Petition
Date, the Debtors have a total of approximately $795 million in cash held in the Bank Accounts
and six investment accounts (as described in the Cash Management Motion, the
Investment Accounts), approximately $235 million, $428 million, and $132 million of which
is held in the segregated Bank Accounts and Investment Accounts of the EFH Debtors, TCEH
Debtors, and EFIH, respectively.
8

23. Because the Bank Accounts are central to the Debtors ongoing business
operations, the Debtors hereby seek authority to continue utilizing the Cash Management System
and Bank Accounts, including the authority to conduct banking transactions, pay the Bank Fees,
and open new debtor in possession bank accounts or close any existing Bank Accounts.
9
I

6
I understand that the sole Bank Account located at a Bank that is not designated as an Authorized Depository
pursuant to the U.S. Trustee Guidelines does not contain significant deposits. Specifically, I understand that
Bank Account No. 7136, held in the name of Luminant Generation with First National Bank of Granbury, is a
miscellaneous receipts account that holds amounts less than the FDIC insured amount at any given time.
7
I understand that before the Petition Date, TXU Energy Receivables sold all of its accounts receivable under the
Debtors prepetition accounts receivable securitization facility to Debtor TXU Energy Retail. I also understand
that Bank Account No. 0559, held in the name of Debtor TCEH LLC, holds approximately $419.6 million of
unrestricted cash from proceeds of the receivables sale and TXU Energy Receivables retained earnings.
8
Cash belonging to the EFH Debtors is segregated from cash belonging to the TCEH Debtors. Similarly, cash
belonging to either the TCEH Debtors or EFH Debtors is segregated from cash belonging to EFIH.
9
Specifically, I understand that the Debtors request that the Court authorize them to close any existing Bank
Accounts, or to open new debtor in possession bank accounts at banks that are Authorized Depositories. I
understand that the Debtors will provide notice of any such opening or closing to the U.S. Trustee, counsel to
any official committee appointed in these cases, counsel to the agent for the TCEH debtor-in-possession
financing facility (the TCEH DIP Facility and such agent, the TCEH DIP Agent), counsel to the ad hoc
committee of TCEH first lien creditors (the Ad Hoc Committee of TCEH First Lien Creditors), counsel to the
agent for the EFIH first lien debtor-in-possession financing facility (the EFIH DIP Facility and such agent,
the EFIH DIP Agent), counsel to the agent for the EFIH second lien debtor-in-possession notes (the EFIH

12

believe that it is critical to the continued operation of their businesses, and to preserving the
value of their estates, that the Debtors be allowed to continue to use the Cash Management
System and Bank Accounts without disruption.
2. EFH Bank Accounts.
24. EFH Corp.s principal Bank Account is Account No. 3584 (the EFH Main
Account), which EFH Corp. maintains with JPM. The EFH Main Account is a general
concentration account for excess cash held by EFH Corp. and holds approximately $25 million
as of the Petition Date. As discussed below, the EFH Main Account transfers funds to the main
Bank Account for the money pool arrangement used by EFH Corp. and certain of its subsidiaries
(as described in the Cash Management Motion, the EFH Money Pool).
25. In addition, I understand that EFH Corp. maintains the following Bank Accounts:
Bank Account No. 2032, maintained with JPM, collects miscellaneous
receipts and holds approximately $1,000 as of the Petition Date; and
Bank Account No. 9707, maintained with Bank of America, is available
for wire transfers in the event of an emergency situation, and is unfunded
as of the Petition Date.
Bank Account No. 9100, maintained with JPM, will be used to collect
future tax payments from Oncor under the Oncor TSA, and is unfunded as
of the Petition Date.
26. As described in detail below, I understand that EFH Corp. also uses the EFH
Main Account to invest excess cash in two Investment Accounts, which together hold
approximately $180.6 million as of the Petition Date.
10

DIP Notes and such agent, the EFIH DIP Notes Agent), and counsel to the ad hoc committee of EFIH
unsecured creditors (the Ad Hoc Committee of EFIH Unsecured Creditors).
10
As discussed below, I understand that EFH Corp. invests in the Goldman Sachs Financial Square Treasury Fund
(Account No. 4691) and the Morgan Stanley Institutional Treasury Fund (Account No. 0166).

13

3. EFH Corporate Services Bank Accounts.
27. EFH Corporate Services, a direct subsidiary of EFH Corp., maintains a principal
Bank Account with JPM, Account No. 3790 (the EFH Money Pool Main Account). As
discussed below, the EFH Money Pool Main Account is the central Bank Account for the EFH
Money Pool. I understand that the EFH Money Pool Main Account maintains a minimum net
balance of approximately $10 million to prefund automated clearinghouse payments
(ACH Payments), and next-day wires, and has a current balance of approximately $10 million.
The Debtors treasury personnel sweep any excess cash held in the EFH Money Pool Main
Account above $10 million into the EFH Main Account on a daily basis. Likewise, and as
discussed below, the Debtors treasury personnel deposit funds into the EFH Money Pool Main
Account from the EFH Main Account as necessary to fund the accounts payable, payroll, and
other obligations related to the operations of the EFH Corp. and certain of its Debtor subsidiaries
that have historically participated in the EFH Money Pool (other than EFIH and its subsidiaries)
(collectively, the EFH Debtors),
11
as well as obligations related to the operations of EFCH,
TCEH LLC, and its direct and indirect Debtor subsidiaries (collectively, the TCEH Debtors)
that are subsequently reimbursed as Intercompany Transactions.
28. In addition to the EFH Money Pool Main Account, I understand that EFH
Corporate Services maintains the following five Bank Accounts:
Bank Account No. 6572 is a collateral account for deposits related to
commercial card obligations, with a current balance of approximately
$4.4 million;
Bank Account No. 8749 is a zero balance account used for payroll
disbursements to approximately 5,700 Debtor employees with a current
balance of approximately $500,000;

11
I understand that the EFH Debtors include all direct and indirect Debtor subsidiaries of EFH Corp., other than
EFIH and its subsidiaries and the TCEH Debtors (as defined in the Cash Management Motion).

14

Bank Account No. 6766 is an accounts payable disbursements account
with a current balance of approximately $10 million;
Bank Account No. 0752 is an accounts payable disbursements account
with a current balance of approximately $5 million; and
Bank Account No. 2019 is a Chase Investments brokerage account with a
current balance of approximately $32,000.
4. TCEH Bank Accounts.
29. I understand that TCEH LLCs principal Bank Accounts are Account No. 9810
(the TCEH Main Account) and Account No. 0481 (the TCEH Money Pool Main Account),
each of which TCEH maintains with JPM. As discussed below, the TCEH Main Account and
the TCEH Money Pool Main Account together serve as the primary source of funds for the
operations of the TCEH Debtors through a separate money pool (as described in the Cash
Management Motion, the TCEH Money Pool and, together with the EFH Money Pool, the
Money Pools). As of the Petition Date, the TCEH Main Account holds approximately
$47 million. The TCEH Money Pool Main Account maintains a minimum net balance of
approximately $2 million to prefund next-day wires. As of the Petition Date, the TCEH Money
Pool Main Account holds approximately $2 million. The Debtors treasury personnel sweep any
excess cash held in the TCEH Money Pool Main Account into the TCEH Main Account on a
daily basis. Likewise, the Debtors treasury personnel deposit funds from the TCEH Main
Account into the TCEH Money Pool Main Account as necessary to fund the operations of the
TCEH Debtors.
30. I understand that TCEH LLC also maintains the following four Bank Accounts:
Bank Account No. 4169, maintained with JPM, is a receipt and
disbursement account relating to financial settlements and over-the-
counter transactions, with a current balance of approximately $1,000;

15

Bank Account No. 3657, maintained with Citibank, is an account used to
fund certain letters of credit, with a current balance of approximately
$27,000; and
Bank Account No. 7837, maintained with JPM, is an account used to
collect the proceeds of the sale of receivables in connection with the wind-
down of the accounts receivable securitization program that was
terminated on October 28, 2013, with a current balance of $0; and
Bank Account No. 0559, maintained with Union Bank, N.A., is an
account used to hold unrestricted cash related to the unwinding of the
former accounts receivable securitization program, with a current balance
of approximately $149.6 million.
12

31. Moreover, as described below, I understand that TCEH LLC invests excess cash
in two Investment Funds, which together hold approximately $226 million as of the Petition
Date.
13

5. Other Debtor Accounts.
32. I understand that EFIH, the direct parent of Oncor Electric Delivery Holdings
LLC (Oncor Holdings), maintains two Bank Accounts with JPM. Bank Account No. 4789
holds approximately $3.7 million as of the Petition Date, and is used to pay general corporate
expenses (the EFIH Main Account). Bank Account No. 4934 holds approximately $1,000 as
of the Petition Date, and is used exclusively for the receipt of postpetition dividends from Oncor.
As discussed below, EFIH invests excess cash in the Morgan Stanley Institutional Treasury Fund
(Account No. 0127), an Investment Account that holds approximately $128.2 million as of the
Petition Date.

12
I understand that the funds in this Bank Account and Bank Account No. 7837 are not part of the prepetition
collateral securing the TCEH First Lien Debt or TCEH Second Lien Notes (as defined in the First Day
Declaration).
13
As discussed below, I understand that TCEH LLC invests in the Goldman Sachs Financial Square Treasury
Fund (Account No. 4694) and the Western Asset Institutional Treasury Fund (Account No. 4883).

16

33. I understand that Generation Development Company LLC maintains a Bank
Account with JPM (Account No. 3633) that holds approximately $1,000 as of the Petition Date.
Generation Development Company LLC uses cash from this Bank Account in connection with
currently limited activities related to development of generation assets.
34. TXU Receivables Company LLC maintains a Bank Account with JPM (Account
No. 8255) that holds $0 as of the Petition Date. The account was used in connection with a
former accounts receivable securitization program.
35. I understand that EFCH, the direct parent of TCEH LLC, maintains a Bank
Account with JPM (Account No. 4511) that holds approximately $4,000 as of the Petition Date.
EFCH uses cash from this Bank Account to pay for general corporate expenses.
36. In addition, based on my understanding, six indirect Debtor subsidiaries of TCEH
LLCTXU Energy Retail, TXU Energy Receivables, Luminant Energy, Luminant Generation,
4Change Energy, and Luminant Miningcollectively maintain 23 collection and disbursement
Bank Accounts, identified on Exhibit C, which together hold approximately $2.9 million as of
the Petition Date.
6. The Debtors Anticipated Postpetition Controls on the Bank
Accounts.
37. The Debtors have taken steps to implement appropriate mechanisms to ensure that
no payments will be made on any debts incurred by them before the Petition Date except as
provided in the Order or another order of the Court. I understand that the procedures the Debtors
have implemented (and will implement after the Petition Date) include: (a) notifying the Banks
of all prepetition payments that should not be honored; (b) segregating the Debtors accounts
payable into prepetition and postpetition amounts; (c) training the Debtors accounting and
accounts payable staff regarding procedures for identifying and segregating prepetition

17

obligations; and (d) developing specific authorization procedures required for the Debtors
accounting and accounts payable staff to issue a payment for any prepetition liability that is
authorized pursuant to an order of the Court.
B. Banking Transactions, Bank Fees and Related Expenses.
38. I understand that the Debtors employ two primary methods of making payments
from the Bank Accounts to external third parties. First, substantially all payments by check or
ACH Payment are made by EFH Corporate Services from the EFH Money Pool Main Account.
14

Specifically, the EFH Money Pool Main Account funds Bank Accounts 6766 and 0752, which
then fund disbursements by check and ACH Payment, respectively. As discussed below, to the
extent that other Debtor affiliates are obligated to reimburse EFH Corporate Services for
payments made on behalf of the Debtors to third parties, the applicable Debtor reimburses EFH
Corporate Services by wire transfer within two days of such check or ACH Payment clearing.
Additionally, certain of the Debtors make direct payments by wire transfer to external third
parties from an applicable disbursement Bank Account.
39. In the ordinary course of business, I understand that the Banks debit the Bank
Accounts on account of all manner of payment items and instructions. In connection with these
payments and the general maintenance of the Bank Accounts, I understand that the Banks
charge, and the Debtors pay, honor, or allow the deduction from the appropriate account, certain
service charges, and other fees, costs, and expenses, including commercial card obligations that
enable the Debtors customers to pay by credit card (collectively, the Bank Fees). I understand
that the Debtors receive credits from JPM in exchange for maintaining a minimum balance in
some of their Bank Accounts with JPM, which JPM applies as an offset to certain Bank Fees.

14
Importantly, I understand that one exception to this payment process relates to refund payments to customers,
which TXU Energy Retail makes directly to customers by check from Bank Account No. 6959.

18

40. I understand that the Cash Management System depends on the ability of the
Banks to maintain and administer the Bank Accounts and to honor and process the Debtors
banking transactions.
C. The Debtors Existing Business Forms.
41. I understand that, in the ordinary course of business, the Debtors use a variety of
correspondence and business forms, such as letterhead, blank check stock, purchase orders,
invoices, and other documents related to the Bank Accounts (collectively, the Business
Forms).
D. Investment Policies.
42. I understand that certain of the Debtors invest funds that would otherwise be held
in the EFH Main Account, the TCEH Main Account, or other Bank Accounts. These funds are
held in six investment accounts: (a) Goldman Sachs Financial Square Treasury Fund (Account
No. 4694); (b) Western Asset Institutional Treasury Fund (Account No. 4883); (c) Goldman
Sachs Financial Square Treasury Fund (Account No. 4691); (d) Morgan Stanley Institutional
Treasury Fund (Account No. 0166); (e) Morgan Stanley Institutional Treasury Fund (Account
No. 0127); and (f) Invesco Treasury Portfolio - Institutional Class (Account No. 4457)
(collectively, the Investment Accounts). I understand that as of the Petition Date, the bulk of
the Debtors cash on-hand (approximately $534.8 million) is invested in the Investment
Accounts.
43. I understand that, pursuant to the Debtors internal investment policy (the
Investment Policy), the Debtors are authorized to invest in (a) short-term securities of the
United States government and federal agencies, and (b) money market funds comprised of such
securities, provided that such money market funds both: (i) comply with Rule 2a-7 of the

19

Investment Company Act of 1940; and (ii) have a rating of AAA by S&P or Aaa by
Moodys.
15

44. In addition to complying with the Investment Policy, I understand that the
Debtors have taken steps to ensure that they will, on a postpetition basis, only use the Investment
Accounts or other investment accounts that substantially comply with Local Bankruptcy Rule
4001-3. Specifically, I understand that each of the Investment Accounts is held with an open-
end management investment company regulated as a money market fund under Rule 2a-7 of the
Investment Company Act of 1940 that (a) invests exclusively in United States Treasury
securities owned directly or through repurchase agreements, (c) has received the highest money
market fund rating of AAA by S&P or Aaa from Moodys, and (c) generally redeems fund
shares in cash with payment being made no later than the business day following a redemption
by a shareholder, except in the event of an unscheduled closing of the Federal Reserve Banks or
the New York Stock Exchange.
16
Additionally, I believe that the policies and practices with

15
I understand that the Debtors are also authorized under the Investment Policy, and with the approval of certain
corporate officers, to make temporary cash investments in an amount at any one time outstanding not to exceed
$50 million in any other short-term investment, security, or instrument. I understand that during the pendency
of these chapter 11 cases, however, the Debtors will not make any such temporary cash investments, as all
funds in excess of operating requirements will be invested in the Investment Accounts.
16
I understand that certain of the money market funds with which the Investment Accounts are held reserve the
right to pay redemptions by a distribution in-kind of securities. Additionally, I understand that certain of the
Investment Funds reserve the right to temporarily suspend redemptions if determined by such funds manager
or board of trustees to be in the interests of the fund and/or shareholders, or in accordance with Section 22(e) of
the Investment Company Act or other applicable law.
Specifically, Section 22(e) of the Investment Company Act provides:
No registered investment company shall suspend the right of redemption, or postpone the date of payment or
satisfaction upon redemption of any redeemable security in accordance with its terms for more than seven days
after the tender of such security to the company or its agent designated for that purpose for redemption,
except
(1) for any period (A) during which the New York Stock Exchange is closed other than customary weekend and
holiday closings or (B) during which trading on the New York Stock Exchange is restricted;

20

respect to (b) and (d) above generally will not be substantially altered by the applicable fund
managers absent shareholder consent or advance notice.
45. I understand that in the ordinary course of business, the Debtors engage in the
following Intercompany Transactions that give rise to Intercompany Claims: (a) transfers and
settlements through the Money Pools (as defined in the Cash Management Motion); (b)
transactions and transfers under the Shared Services (as defined in the Cash Management
Motion); (c) certain ordinary course transactions under the TSAs (as defined in the Cash
Management Motion); (d) transactions related to Subleases (as defined in the Cash Management
Motion); and (e) transactions related to Letters of Credit (as defined in the Cash Management
Motion).
1. The Money Pools.
46. I understand that the Debtors utilize two Money Pools to facilitate transactions
among themselves and to minimize the number of accounts needed for the corporate group to
operate. Specifically, EFH Debtors may participate in the EFH Money Pool,
17
and TCEH
Debtors may participate in the TCEH Money Pool. I understand that each Money Pool is a
general ledger that tracks, aggregates, nets, and settles intercompany payables and receivables

(2) for any period during which an emergency exists as a result of which (A) disposal by the company of
securities owned by it is not reasonably practicable or (B) it is not reasonably practicable for such company
fairly to determine the value of its net assets; or
(3) for such other periods as the Commission may by order permit for the protection of security holders of the
company. The Commission shall by rules and regulations determine the conditions under which (i) trading
shall be deemed to be restricted and (ii) an emergency shall be deemed to exist within the meaning of this
subsection.
Investment Company Act of 1940 22(e), 15 U.S.C. 80a (1940).
17
I understand that historically, EFIH and certain of EFH Corp.s non-Debtor subsidiaries have participated in the
EFH Money Pool. Pursuant to the Cash Management Motion, the Debtors do not seek relief to allow, on a
postpetition basis, (a) EFIH or its subsidiaries to make or receive loans through the EFH Money Pool, or (b)
non-Debtor entities to obtain access to cash through the EFH Money Pool.

21

owed to, and by, the entities that participate in that Money Pool. The list of Debtors that have
historically participated in the EFH Money Pool or the TCEH Money Pool, and which will
continue to participate in their respective Money Pools on a postpetition basis, is attached hereto
as Exhibit D of the Cash Management Motion .
47. I understand that the primary Bank Accounts associated with the EFH Money
Pool are the EFH Main Account and the EFH Money Pool Main Account. The EFH Money Pool
Main Account maintains a minimum net balance of approximately $10 million to prefund
outstanding checks, ACH Payments, and next-day wires. I understand that the Debtors treasury
personnel sweep any excess cash above the minimum net balance held in the EFH Money Pool
Main Account into the EFH Main Account on a daily basis, and subsequently invest this excess
cash in certain of the Investment Accounts. Moreover, I understand that funds are deposited into
the EFH Money Pool Main Account from the EFH Main Account as needed to the extent that
scheduled disbursements exceed the minimum net cash balance in the EFH Money Pool Main
Account.
48. I understand that the primary Bank Accounts associated with the TCEH Money
Pool are the TCEH Main Account and the TCEH Money Pool Main Account. The TCEH
Money Pool Main Account maintains a minimum net balance of approximately $2 million to
prefund next-day wires. I understand that the Debtors treasury personnel sweep any excess cash
held in the TCEH Money Pool Main Account (above minimum net balances required to prefund
next-day wires) into the TCEH Main Account on a daily basis, and subsequently invest this
excess cash in certain of the Investment Accounts. Moreover, I understand that funds are
deposited into the TCEH Money Pool Main Account from the TCEH Main Account as needed to

22

the extent that scheduled disbursements exceed the minimum net cash balance in the TCEH
Money Pool Main Account.
49. I understand that the Money Pools facilitate Intercompany Transactions, including
the provision of intercompany services and the payment of third-party obligations, among
entities that participate in the same Money Pool. Each entity that participates in a Money Pool is
either a net borrower of, or a net lender to, one of the Money Pools, depending upon
whether, in the aggregate, an entity contributes or draws money from the Money Pool.
Additionally, I understand that if an entity provides intercompany services to another entity that
participates in the same Money Pool, or pays an expense on behalf of another entity within the
same Money Pool, this is treated as an extension of intercompany credit through the appropriate
Money Pool. These arrangements, in turn, give rise to Intercompany Claims, and net lenders
accumulate interest on their balances at predetermined rates.
18

50. I understand that, historically, Intercompany Claims among the entities that
participate in the same Money Pool have not been settled in cash; rather, they are recorded as a
book entry and appropriate adjustment to the applicable account balances of both the borrower
and lender. The Debtors track all such Intercompany Transactions electronically in their
accounting system and can ascertain, trace, and account for them as necessary. Moreover, cash
is not moved between the two separate Money Pools except pursuant to documented
transactions. The Debtors seek authority to continue to operate the Money Pools in accordance
with their past practices.

18
I understand that net borrowers from the EFH Money Pool must make interest payments to the EFH Money
Pool at a rate of 10.875% per annum, a percentage that is based on the EFH Corp. 10.875% LBO Senior Notes
due 2017. I also understand that net borrowers from the TCEH Money Pool must make interest payments to the
TCEH Money Pool at a predetermined rate, equal to the daily weighted average cost of short-term borrowings
under TCEHs prepetition revolving credit facility, plus the credit facility commitment fee spread. An entitys
accrued interest is paid monthly by a book entry in the ledgers of both the borrower and lender.

23

2. The Shared Services.
51. I understand that, in accordance with the Shared Services Agreement between
Debtor EFH Corporate Services and the TCEH Debtors, dated October 23, 2013 (as amended,
the TCEH Shared Services Agreement) and the Shared Services Agreement between Debtor
EFH Corporate Services and Debtor EFIH, dated April 1, 2014 (the EFIH Shared Services
Agreement and, together with the TCEH Shared Services Agreement, the Shared Services
Agreements), the Money Pools, or the Debtors historical practices, EFH Corporate Services:
(a) provides essential centralized administrative and back-office services to its affiliates and
employs corporate-level employees to provide services for its affiliates (the Centralized
Services); (b) makes direct payments for certain expenses attributable to its affiliates,
irrespective of whether EFH Corporate Services is the payment obligor for such expenses,
including the Debtors health and welfare benefits for their employees, certain pension related
obligations, certain information technology and capital expenditures, and certain real property
related expenses (the Direct Billing Goods and Services); (c) in connection with its treasury
function for the enterprise as a whole, (i) issues checks and ACH Payments on behalf of its
affiliates (the Reimbursable Expenses); and (ii) collects and receives payments owed to its
affiliates and remits such amounts to the appropriate affiliate (the Remittance Services); and
(d) purchases certain assets for the benefit of its affiliates (the Shared Asset Costs, and together
with the Centralized Services, the Direct Billing Goods and Services, the Reimbursable
Expenses, the Remittance Services, and the Shared Asset Costs, the Shared Services).
19
I
understand that EFH Corporate Services employs approximately 500 employees, including the

19
Additionally, I understand that EFH Corporate Services seeks to provide similar services to certain direct and
indirect non-Debtor subsidiaries of EFH Corp. (collectively, the Non-Debtor Affiliates), including Oncor
Holdings and its subsidiaries, EFH Properties Company, Basic Resources Inc., EFH Vermont Insurance
Company, and Ebasco Services of Canada Limited on a postpetition basis, pursuant to its historical practices

24

majority of the Debtors executives, and enters into thousands of contractual arrangements with
third parties for and on behalf of its affiliates. I understand that EFH Corporate Services
provides the Shared Services at cost, and does not charge its affiliates any premium or markup.
52. I understand that EFH Corporate Services receives payment from its affiliates for
the allocated cost of the Centralized Services through monthly service bills, invoices its affiliates
for their allocated cost of the Shared Asset Costs, and seeks reimbursement for the cost of the
Direct Billing Goods and Services and the Reimbursable Expenses upon check or ACH
clearance.
20
Pursuant to the Remittance Services, EFH Corporate Services collects payments
owed to its affiliates and remits such amounts to the appropriate affiliate when due.
21

53. I understand that the EFH Debtors primarily settle Intercompany Claims owed to
EFH Corporate Services related to the Shared Services by book entry and adjustment to their
respective ledger balances in the EFH Money Pool. I understand that the TCEH Debtors, EFIH,
and Non-Debtor Affiliates pay Intercompany Claims related to the Shared Services to EFH
Corporate Services by making cash payments to the EFH Money Pool Main Account, net of
Intercompany Claims owed by EFH Corporate Services on account of Remittance Services. I
understand that in 2013, the total net amount reimbursed to EFH Corporate Services by the
TCEH Debtors on account of the Shared Services was approximately $2,235.2 million (of which
approximately $1,987.5 million was related to Reimbursable Expenses and Direct Billing Goods

20
On February 18, 2014, TCEH LLC posted a deposit letter of credit in the total amount of $157.2 million to EFH
Corporate Services for amounts owing under the TCEH Shared Services Agreement, approximately $100
million of which has been drawn as of the Petition Date.
21
For example, EFH Corporate Services receives approximately $15 million to $20 million annually from Oncor
on account of nuclear decommissioning fees that are payable by the TCEH Debtors on Oncors behalf, and
remits such amounts to the TCEH Debtors for payment of such fees. The nuclear decommissioning fees are
further discussed in the Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders
Authorizing the Debtors to Pay Certain Prepetition Taxes and Fees and Granting Related Relief (the Taxes
Motion), filed contemporaneously herewith.

25

and Services), and the total net amount reimbursed to EFH Corporate Services by EFIH on
account of the Shared Services was approximately $125,000.
54. I believe that the Shared Services result in efficiencies and cost savings to the
Debtors, and create value for the Debtors and their estates. Moreover, I believe that given the
integrated nature of the services and thousands of underlying agreements and employment
relationships, requiring the Debtors to discontinue the Intercompany Transactions and the
settlement of Intercompany Claims related to the Shared Services at this time would be
extremely costly and inefficient, and detrimental to the value of the Debtors and their estates.
55. As of the Petition Date, I understand that the TCEH Debtors owe EFH Corporate
Services approximately $69.1 million on account of prepetition Intercompany Claims related to
the Shared Services, and EFIH owes EFH Corporate Services approximately $700,000 on
account of prepetition Intercompany Claims related to the Shared Services.
3. The Tax Sharing Agreements.
56. I understand that EFH Corp. is party to two tax sharing agreements: (a) one with
EFCH, TCEH LLC and certain of its subsidiaries, and EFIH (the Competitive TSA); and
(b) one with Oncor and Oncor Holdings (the Oncor TSA and, together with the Competitive
TSA, the TSAs).
22
I believe that historically, the TSAs have been an efficient means of
managing the Debtors tax liabilities and utilizing tax attributes on a consolidated basis, and
greatly facilitate the Debtors accounting and tax reporting and payment obligations. Each of the
TSA parties are liable for Texas state margin taxes. Under the TSAs, EFH Corp. files Texas

22
I understand that EFH Corp. and Oncor have implemented structural and operational ring-fencing measures to
enhance the credit quality of Oncor. I understand that because Oncor is a partnership for federal income tax
purposes, EFH Corp.s consolidated federal income and Texas state margin tax returns only include EFH
Corps share of Oncors income. Accordingly, I understand that under the Oncor TSA, payments from Oncor to
EFH Corp. are limited to EFH Corp.s share of the federal income and state margin taxes that Oncor would owe
if it filed its own tax returns, net of tax refunds and any amounts owed to Oncor for the deemed use by other
TSA parties of Oncors tax attributes.

26

state margin tax returns that include the TSA parties results, and subsequently settles
Intercompany Claims with each of the TSA parties on account of the Texas state margin taxes
that are owed by each TSA party.
57. I understand that the Competitive TSA allocates the consolidated income tax
liability of the Competitive TSA parties (the Competitive Group) by first requiring the
calculation of the tax liability for each corporate member of the Competitive Group that would
have resulted if each such corporate member had filed a separate return on a stand-alone basis
separate from the Competitive Group, with the liability of a corporate member further allocated
to any subsidiaries that are disregarded as separate from such member.
23
I understand that the
total amount paid in 2013 by the TCEH Debtors to EFH Corp. under the Competitive TSA, net
of any reimbursements paid from EFH Corp. to the TCEH Debtors, was approximately $143.1
million.
58. Generally, I understand that the Oncor TSA (a) requires Oncor to make payments
to EFH Corp. and the minority owners of Oncor in respect of tax liabilities generated by its
operations (and in certain circumstances entitles Oncor to payments from EFH Corp. and the
minority owners in respect of net operating losses or other tax attributes recognized by it) and (b)
requires Oncor Holdings to make payments directly to EFH Corp. in respect of tax liabilities
generated by its operations (and in certain circumstances entitles Oncor Holdings to payments
from EFH Corp. in respect of tax losses recognized by it). I understand that the total amount
paid in 2013 to EFH Corp. by Oncor and Oncor Holdings under the Oncor TSA, net of any

23
I understand that the amount allocated to each member is comprised of two components. First is the fraction of
the actual consolidated tax liability that corresponds to each such members relative positive separate taxable
income. Second is the relative benefit to members with positive separate taxable incomes from losses
generated by other members of the consolidated group and utilized by the group, whether such losses are
recognized in the current period or in a prior period. I understand that in certain circumstances, a Competitive
TSA party that generates a tax loss may be entitled to receive a payment from EFH Corp.

27

reimbursements owed from EFH Corp. to Oncor and Oncor Holdings, was approximately $90
million and $34 million, respectively.
24

59. I understand that pursuant to the Motion of Energy Future Holdings Corp., et al.,
for Entry of Interim and Final Orders Authorizing the Debtors to Pay Certain Prepetition Taxes
and Fees and Granting Related Relief (the Taxes Motion), the Debtors are seeking authority to
continue to pay approximately $70 million on account of certain prepetition state law margin tax
claims to ensure that they will be able to continue operating their businesses in the ordinary
course. Accordingly, pursuant to the Cash Management Motion, I understand that the Debtors
are only seeking to settle prepetition Intercompany Claims under the TSAs relating to prepetition
state law margin tax claims that the Debtors are authorized to pay under the Taxes Motion, and
to continue to settle Intercompany Claims arising under the TSAs with respect to state law
margin tax claims on a postpetition basis. I also understand that the Debtors are not seeking at
this time to settle Intercompany Claims relating to federal income taxes among EFH Corp. and
the TSA parties.
4. Subleases.
60. I understand that Non-Debtor EFH Properties Company and certain Debtors lease
property for the operation of the businesses and, pursuant to sublease agreements, historical
practices, and other arrangements (collectively, the Subleases), sublet office space and real
property to their affiliates. For example, the Debtors and their affiliates Dallas office
headquarters, Energy Plaza, is leased pursuant to a lease agreement dated February 14, 2002 (the
EP Lease) between non-Debtor EFH Properties Company, as lessee, and U.S. Bank, National
Association (as successor-in-interest to State Street Bank and Trust Company of Connecticut,

24
I understand that in accordance with the Restructuring Support Agreement attached to the First Day
Declaration, the Debtors will seek to assign the Oncor TSA to EFIH during these chapter 11 cases.

28

National Association), as Owner Trustee of the ZSF/Dallas Tower Trust, as the lessor. EFH
Properties Company, in turn, subleases Energy Plaza office space to certain of its affiliates,
including EFH Corporate Services and Oncor. I understand that under the shared services
agreements, EFH Corporate Services seeks reimbursement from their affiliates for its allocated
share of rent, property taxes, operating costs, utilities, depreciation, and other related expenses. I
understand that Oncor sub-subleases its Energy Plaza space to Debtor Luminant Generation,
charging Luminant Generation below Oncors cost of subleasing such space from EFH
Properties Company. I understand that in 2013, the TCEH Debtors paid approximately $4.3
million to Non-Debtor Affiliates under the Subleases. I also understand that as of the Petition
Date, the TCEH Debtors owe their affiliates approximately $400,000 on account of prepetition
Intercompany Claims under the Subleases.
5. Letters of Credit
61. I understand that TCEH LLC has issued, and is obligated under, the deposit letters
of credit for the benefit of its Debtor affiliates (the Letters of Credit). The following table lists
the Letters of Credit that TCEH LLC has issued to third parties for the benefit of certain EFH
Debtors and Non-Debtor Affiliates, and the amount outstanding net of draws on such Letters of
Credit:

29

Applicable Beneficiary(ies) Number of Letters of Credit Total Net Amount
Outstanding
EFH Corp. 6 $26,169,000
EFH Corp. and LSGT Gas Company LLC 1 $12,014,000
EFH Corporate Services 8 $5,935,000
EFH Vermont Insurance Company
25
2 $704,000
Brighten Energy LLC 2 $500,000
LSGT Gas Company LLC 1 $250,000

62. The Letters of Credit are backed by restricted cash belonging to the TCEH
Debtors. To the extent that third parties draw on these Letters of Credit as payment for goods
and services provided to the Debtors and their affiliates, a payable will result from the applicable
beneficiary (if the beneficiary is not TCEH LLC) to TCEH LLC. I understand that the TCEH
Debtors reimbursement obligations to TCEH LLC under the Letters of Credit are settled
through the TCEH Money Pool. I understand that because TCEH LLC is a net payer to EFH
Corp. and certain of its subsidiaries, including EFH Corporate Services, on account of
Intercompany Claims arising under the other Intercompany Transactions, payables owed to
TCEH LLC by these affiliates for drawdowns on the Letters of Credit are generally offset against
the TCEH Debtors obligations, thus reducing the amount of cash payments actually made by the
TCEH Debtors. I understand that in 2013, EFH Corp. and certain of the EFH Debtors
reimbursed TCEH LLC approximately $1.4 million for amounts drawn under the Letters of
Credit. I also understand that as of the Petition Date, there are approximately $57.8 million of
TCEH LLC Letters of Credit issued and outstanding for the benefit of EFH Corp. and certain
EFH Debtors, of which approximately $56.4 million remains undrawn.

25
Non-Debtor Affiliate EFH Vermont Insurance Company is a direct subsidiary of EFH Corp.

30

63. As of the Petition Date, I understand that there are no outstanding Intercompany
Claims owing from the EFH Debtors and the Non-Debtor Affiliates to TCEH LLC on account of
reimbursement obligations under the Letters of Credit.
6. The Intercompany Transactions are Vital to the Debtors Business
Operations.
64. The Debtors operations are highly complex and integrated, and the Intercompany
Transactions enable the Debtors to efficiently provide essential goods and services to their
Debtor and Non-Debtor Affiliates and settle internal and external obligations. I believe that if
the Intercompany Transactions were to be discontinued, the Cash Management System and
related administrative controls would be disrupted to the Debtors detriment. Furthermore, I
believe that preserving the business as usual atmosphere and avoiding the unnecessary
distractions that inevitably would be associated with any substantial disruption in the Cash
Management System will facilitate the Debtors reorganization efforts.

31

Operational Motions
Wages Motion.
26
V.
65. I understand that in the Wages Motion, the Debtors seek entry of Interim and
Final Orders authorizing, but not directing, the Debtors to: (a) pay certain prepetition wages,
salaries, reimbursable employee expenses, and other compensation; (b) pay and honor employee
and retiree medical and similar benefits (each as described in sub-clauses (a) and (b) defined in
the Wages Motion, and collectively, the Employee Obligations); and (c) continue employee
compensation and employee and retiree benefit programs (each as defined in the Wages Motion,
and collectively, the Employee Programs) in the ordinary course of business on a postpetition
basis and in accordance with prepetition policies.
27

A. Overview of the Debtors Work Force.
66. I understand that EFH Corp., the direct or indirect Debtor parent of each of the
Debtors, and its subsidiaries collectively employ approximately 9,100 employees. I understand
that of that number, the Debtors employ approximately 5,700 employees (collectively, the
Employees), approximately 5,650 of whom are full-time and approximately 50 of whom are
part-time.
67. I understand that approximately 2,000 Employees are represented by unions that
are party to 11 collective bargaining agreements (collectively, the CBAs). The Debtors pay
approximately 2,100 Employees on an hourly basis and approximately 3,600 Employees are

26
See Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders (A) Authorizing the
Debtors to (I) Pay Certain Prepetition Compensation and Reimbursable Employee Expenses, (II) Pay and
Honor Employee and Retiree Medical and Similar Benefits, and (III) Continue Employee and Retiree Benefit
Programs, and (B) Modifying the Automatic Stay, filed contemporaneously herewith.
27
I understand that the summary of the Debtors various Employee Obligations and Employee Programs provided
in the Wages Motion is qualified entirely by the Debtors official policies or other practices, programs, or
agreements, whether written or unwritten, evidencing an arrangement among the Debtors and their Employees
(each, an Official Policy). I understand that in the event of any inconsistency or ambiguity between this
summary and an Official Policy, the terms of such Official Policy shall govern.

32

salaried. I also understand that Debtors employ approximately 300 Staffing Provider Workers,
during various periods throughout the year through an employment agency, and approximately
40 Independent Contractors.
B. Payroll.
1. Employees Compensation.
68. I understand that the Debtors generally are current on all their payroll obligations
to the Employees. That said, as of the Petition Date, I understand that certain prepetition wage
obligations have accrued and remain unpaid. Additionally, I understand that some Employees
may be entitled to compensation because (a) discrepancies may exist as to amounts paid and
(b) some payroll checks issued before the Petition Date may not have been presented for
payment or may not have cleared the banking system and, accordingly, have not been honored
and paid as of the Petition Date. I understand that the Debtors compensate their Employees
(collectively, Compensation) as discussed below.
69. I understand that certain of the Debtors Employees are compensated on an hourly
basis and may be entitled to prepetition amounts on account of compensation that has accrued
but remains unpaid as of the Petition Date on behalf of such Employees. Alternatively, I
understand that certain of the Debtors Employees are compensated by way of an annual salary
which accrues on a monthly or quarterly basis. As a result, I understand that there may be
prepetition amounts on account of compensation that has accrued but remains unpaid as of the
Petition Date on behalf of such Employees.
70. On average, I understand that the Debtors pay approximately $10.0 million per
week on account of Compensation. As of the Petition Date, I understand that the Debtors
estimate that they owe Employees an aggregate amount of approximately $4.1 million on
account of Compensation earned before the Petition Date (collectively, Unpaid

33

Compensation), approximately $4.1 million of which will become due and owing within the
Interim Period. I understand that the Debtors believe that no amount owed to an Employee
exceeds the $12,475 priority cap imposed by section 507(a)(4) of the Bankruptcy Code on
account of Unpaid Compensation.
71. I understand that the Employees perform a variety of critical functions, including
sales, customer service, plant and mine operations, accounting, finance, management and other
tasks for the Debtors, and in return, depend on the Debtors for their Compensation to pay their
daily living expenses. Thus, I understand that pursuant to the Interim Order, the Debtors seek
authority, but not direction, to continue to pay Compensation in the ordinary course of business
on a postpetition basis, and to pay Employees any Unpaid Compensation accrued in the ordinary
course of business that comes due during the Interim Period, up to $12,475 per eligible
Employee (approximately $5.0 million in the aggregate). Pursuant to the Final Order, I
understand that the Debtors seek authority, but not direction, to continue to pay Compensation in
the ordinary course of business on a postpetition basis and to pay all Unpaid Compensation owed
to Employees, including amounts owed to Employees above $12,475 (if any).
2. Non-Insider Incentive Compensation.
72. I understand that certain of the Debtors non-insider Employees who work in a
customer-facing sales capacity receive commission-based compensation from two performance
based plans: (a) the TXU Sales Incentive Plan and (b) the Luminant Retail Gas Sales Incentive
Plan (each as described in the Wages Motion). I understand that the Debtors have historically
used these plans to drive sales efforts and motivate those Employees who have made significant
individual and team contributions to the Debtors sales efforts. I also understand that these
Employees are highly marketable given the Debtors fiercely competitive retail market, and the
attrition rate associated with these Employees has historically been high. Failure to compensate

34

such Employees in accordance with prepetition practices could result in their immediate
departure and jeopardize the Debtors customer relationships. I understand that the majority of
these Employees are eligible to receive such compensation on a biweekly or monthly basis, and,
as a result, there may be prepetition amounts that have accrued but remain unpaid as of the
Petition Date. Importantly, I understand that many of these Employees do not participate in
other additive incentive programs.
28

73. TXU Sales Incentive Plan. The Debtors have historically offered a sales
incentive plan to approximately 200, non-insider, full-time Employees at TXU Energy based on
their performance in sales management or sales support positions (the TXU Sales Incentive
Plan). Specified senior management sets certain performance goals for eligible Employees
based on the detailed business plan approved by the TXU Energy executive leadership team.
Proposed payments are subject to a rigorous review process, including review by the vice
presidents of the relevant business units and approval by a dedicated award committee. As of the
Petition Date, the Debtors estimate that approximately $800,000 is due and outstanding on
account of the TXU Sales Incentive Plan, approximately $800,000 of which will become due and
payable during the Interim Period (approximately $4,000 per eligible Employee) (the Unpaid
TXU Sales Incentive Payments).
74. Importantly, I understand that none of the Employees who are eligible to
participate in and receive payments from the TXU Sales Incentive Plan are insiders, as defined
under section 101(31) of the Bankruptcy Code. Instead, I understand that these Employees work
on commission earned through their efforts from interfacing with the Debtors diverse customer

28
Many of the Debtors Employees participate in various additive employee compensation programs. Although
the Debtors are not seeking relief with respect to such additive employee compensation programs in the Wages
Motion, the Debtors intend to seek authority to continue such programs early in these chapter 11 cases pursuant
to a separate motion.

35

base. I understand that the Employees eligible to participate in the TXU Sales Incentive Plan are
uniquely positioned to know a significant amount about the Debtors and the Debtors industry, as
well as a significant amount of detail about the Debtors customer base. As such, I understand
that replacing these Employees would be highly disruptive to the business and directly affect the
Debtors relationship with their customers. As a result, I understand that the Debtors are seeking
relief pursuant to the Interim Order to honor Unpaid TXU Sales Incentive Payments that become
due and payable during the Interim Period and relief pursuant to the Final Order to honor all
Unpaid TXU Sales Incentive Payments.
75. 18. Luminant Retail Gas Sales Incentive Plan. The Debtors have historically
offered a sales incentive plan to approximately four non-Insider, full-time gas sales Employees at
Luminant based on financial EBIT targets for each year (the Luminant Retail Gas Sales
Incentive Plan). Payments under the Luminant Retail Gas Sales Incentive Plan are subject to a
rigorous approval process similar to the process described above with respect to the TXU Sales
Incentive Plan. As of the Petition Date, the Debtors estimate that approximately $50,000 is due
and outstanding on account of the Luminant Retail Gas Sales Incentive Plan (the Unpaid
Luminant Incentive Retail Plan Payments).
76. I understand that as with the TXU Sales Incentive Plan, no Employees who are
insiders (as defined under the Bankruptcy Code) are entitled to participate in the Luminant Retail
Gas Sales Incentive Plan. I understand that like the TXU Sales Incentive Plan, the Luminant
Retail Gas Sales Incentive Plan incentivizes those Employees in a customer-facing position to
create sustainable customer relationships that ultimately provide direct and positive returns to the
Debtors operations.
77. On average, I understand that the Debtors pay approximately $10 million per

36

week on account of Compensation. As of the Petition Date, I understand that the Debtors
estimate that they owe Employees an aggregate amount of approximately $5.2 million on
account of Compensation earned before the Petition Date (collectively,
Unpaid Compensation), approximately $4.2 million of which will become due and owing
within the Interim Period. I believe that no amount owed to an Employee exceeds the $12,475
priority cap imposed by section 507(a)(4) of the Bankruptcy Code on account of Unpaid
Compensation.
78. The Employees perform a variety of critical functions, including sales, customer
service, plant and mine operations, accounting, finance, management and other tasks for the
Debtors, and in return, depend on the Debtors for their Compensation to pay their daily living
expenses.
3. Staffing Provider Workers.
79. I understand that the Debtors utilize the services of approximately 300 of various
types of temporary workers (collectively, the Staffing Provider Workers) through eight
different vendors (collectively, the Staffing Providers).
29
I understand that the Debtors
typically pay for the Staffing Provider Workers services directly to the Staffing Providers
through their accounts payable system. The Staffing Providers, in turn, pay the Staffing Provider
Workers.
80. I understand that Staffing Provider Workers are, in many instances, highly skilled
workers. For example, I understand that a significant group of Staffing Provider Workers
provide information technology services that would be difficult to replace in a short timeframe.

29
I understand that one of the Staffing Providers, Pinnacle Technical Resources, Inc. is an affiliate of Kohlberg
Kravis Roberts & Co., which has a substantial equity interest in EFH. Importantly, the Unpaid Staffing
Provider Fees (as defined below) owed to Pinnacle are secured by two letters-of-credit in the collective amount
of approximately $3 million (the Letters of Credit), both of which will expire in June of 2014.

37

I believe that the institutional knowledge held by such Staffing Provider Workers would also be
difficult to replace in a short timeframe. I believe that if they are not permitted to pay the
Staffing Providers for the services of the Staffing Provider Workers, the Staffing Providers may
withdraw the Staffing Provider Workers or refuse to provide the Debtors with replacement
workers.
81. I understand that on average, the Debtors pay approximately $710,000 per week
on account of fees paid to the Staffing Providers on account of compensation owed to Staffing
Provider Workers (the Staffing Provider Fees). I understand that as of the Petition Date, the
Debtors estimate that approximately $500,000 is outstanding on account of the Staffing Provider
Fees (the Unpaid Staffing Provider Fees).
4. Independent Contractors.
82. I understand that through various contracts, approximately 40 independent and
small contractors (collectively, the Independent Contractors) conduct a range of important
services for the Debtors. I understand that the Independent Contractors provide on-site
accounting, information technology, and other services on both a full-time and seasonal basis,
and perform a variety of administrative, accounting, legal, finance, management support, and
other related tasks. I believe that their skills, knowledge and understanding with respect to the
Debtors operations, customer relations and infrastructure are essential to the effective
reorganization of the Debtors business. In addition, I understand that many of the Independent
Contractors are small companies that may suffer financial hardship without immediate payment
for their services.
83. On average, I understand that the Debtors pay the vendors approximately $60,000
per week on account of compensation owed to the Independent Contractors (collectively, the
Independent Contractor Fees). I understand that as of the Petition Date, the Debtors estimate

38

that they owe an aggregate amount of approximately $160,000 in Independent Contractor Fees
earned before the Petition Date (collectively, the Unpaid Independent Contractor Fees),
approximately $150,000 of which will become due and owing within the Interim Period.
5. Consultant Compensation.
84. I understand that the EFH Corp. board of directors (the Board) utilizes the
services of two advisors who attend Board meetings and advise the Board as necessary and
requested (the Board Advisors). I understand that the Debtors also collectively utilize the
services of 13 third-party advisors who serve on a third-party advisory board (the Regulatory
Advisors and, together with the Board Advisors, the Consultants). I understand that the
Regulatory Advisors routinely advise companies in the Debtors industry on critical nuclear and
environmental regulatory issues. I understand that none of the Consultants are insiders. I
understand that in the aggregate, the Board Advisors receive $500,000 annually for their services
(the Board Consultant Compensation) and the Regulatory Advisors receive $520,000 annually
for their services (the Regulatory Consultant Compensation and, together with the Board
Consultant Compensation, the Consultant Compensation). I believe that the Consultants
collective skills, knowledge, and understanding of the Debtors operations and infrastructure are
critical to the successful reorganization of the Debtors businesses.
85. The Debtors estimate that, as of the Petition Date, approximately $25,000 has
accrued and remains outstanding on account of Regulatory Consultant Compensation (the
Unpaid Regulatory Consultant Compensation) and no amounts have accrued and remain
outstanding on account of the Board Consultant Compensation as of the Petition Date.
6. Payroll Processor.
86. I understand that the Debtors use the services of Northgate Arinso (the
Payroll Processor) to process direct deposit transfers and administer payroll checks to

39

Employees.
30
I understand that the Debtors pay approximately 2% of their Employees by check
and the remainder by direct deposit. I understand that the Payroll Processor calculates the
Debtors payroll, health benefit, and tax obligations for each Employee, and the Debtors then
transfer funds sufficient to satisfy such obligations to the Payroll Processor in advance of the end
of the applicable pay period.
87. I understand that, on average, the Debtors pay approximately $300,000 per month
to the Payroll Processor for the payroll-related services that it provides to the Debtors and related
administrative costs (the Payroll Processor Fees). I understand that as of the Petition Date, the
Debtors estimate that approximately $300,000 is outstanding on account of amounts owed to the
Payroll Processor (the Unpaid Payroll Processor Fees), all of which will become due and
owing within the Interim Period.
88. I believe it is critical the Debtors be able to compensate Employees on the
historical payroll schedule. The Debtors will be unable to stay on the historical payroll schedule
without the Payroll Processor because the Payroll Processor is responsible for calculating
benefits and administering paychecks for the Employees, and replacing the Payroll Processor
would take a significant amount of time.
C. Reimbursable Expenses.
89. I understand that the Debtors reimburse certain Employees or pay credit card
invoices on behalf of certain Employees for approved, legitimate expenses incurred on behalf of
the Debtors in the scope of their employment (collectively, Reimbursable Expenses). I
understand that Reimbursable Expenses include business development and training activities,
activities with current or potential customers and partners, business-related travel expenses

30
I understand that Northgate Arinso is an affiliate of Kohlberg Kravis Roberts & Co., which has a substantial
equity interest in EFH.

40

including meals, hotels, flights, car rentals, fuel, cellular service used for business purposes
certain social club memberships, and purchases made for business purposes on the Debtors
corporate credit cards. I understand that Reimbursable Expenses are often incurred by
Employees and certain members of the Debtors boards who must travel as part of their
employment responsibilities.
90. I understand that the Debtors reimburse Employees for Reimbursable Expenses in
two ways: through direct reimbursement (the Direct Reimbursement Process) and the use of
corporate credit and purchasing cards issued by JP Morgan Chase (collectively, the Credit and
Purchasing Cards), each as described in the Wages Motion.
91. I understand that the Debtors pay approximately $3 million per month on account
of Reimbursable Expenses, which are paid in arrears.
31

92. I believe that the Employees incurred the Unpaid Reimbursable Expenses as
business expenses on the Debtors behalf and with the understanding that the Debtors would
reimburse the Employees. At a minimum, I understand that the Direct Reimbursement Process
and the Credit and Purchasing Cards are a historical feature of the Debtors employment
arrangement, and curtailing or halting this program would substantially disrupt the expectations
of the Employees and, therefore, the Debtors operations. In addition, I understand that the
Debtors internal employee reimbursement policy imposes a number of internal controls to
ensure reimbursement requests are properly reviewed. I understand that among other things, (a)
reimbursement requests can only be approved by managers who are permitted to implement a

31
I understand that in certain narrow circumstances, the Reimbursable Expenses also include reasonable and
documented expenses incurred by members of the Debtors boards of directors and managers in the scope of
their duties as board members. I understand that the approval of such expenses is subject to various internal
review processes. As of the Petition Date, the Debtors anticipate that approximately $25,000 of Unpaid
Reimbursable Expenses is attributable to reasonable and documented expenses incurred by board members in
the scope of their employment.

41

stricter review process but not a more lenient review process, (b) expenses can only be
reimbursed if incurred for the benefit of the company and (c) expenses can only be reimbursed
if incurred at the lowest available costs (with very particular rules delineated with respect to
travel and expenses).
D. Deductions and Withholdings.
1. Payroll Taxes.
93. I understand that the Debtors are required by law to withhold from Employees
paychecks amounts related to federal, state, and local income taxes, Social Security, and
Medicare taxes for remittance to the appropriate federal, state, or local taxing authority
(collectively, the Withheld Amounts). In addition, I understand that the Debtors are required
by applicable statutory authority to pay Social Security and Medicare taxes, and based on a
percentage of gross payroll, additional amounts for federal and state unemployment insurance
(the Employer Payroll Taxes and, together with the Withheld Amounts, the Payroll Taxes).
94. I understand that, on average, the Debtors withhold approximately $12 million per
month for Payroll Taxes, including both Employee and Debtor-paid portions. I also understand
that as of the Petition Date, the Debtors estimate that approximately $900,000 million in Payroll
Taxes have accrued and remain unpaid (the Unremitted Payroll Taxes), all of which will
become due and owing to various taxing authorities within the Interim Period.
95. I believe that since the Debtors are statutorily obligated to pay Payroll Taxes, their
inability to do so may result in adverse legal consequences that disrupt the reorganization
process. Moreover, I understand from Debtors counsel that certain of the Payroll Taxes are
generally held in trust by the Debtors and are not property of their estates.

42

E. Miscellaneous Deductions.
96. In addition to various deductions discussed throughout the Wages Motion, the
Debtors routinely deduct certain amounts from Employees paychecks during each applicable
payroll period on account of miscellaneous items, including garnishments, child support, and
other similar deductions (collectively, the Miscellaneous Deductions).
97. On average, the Debtors remit approximately $400,000 per month on account of
the Miscellaneous Deductions. As of the Petition Date, the Debtors estimate they have collected
approximately $400,000 in Miscellaneous Deductions from Employees paychecks that they
have not yet transferred to the appropriate third parties (the Unremitted Miscellaneous
Deductions), all of which will become due and owing to various third parties within the Interim
Period.
98. The Debtors believe that the Miscellaneous Deductions are generally held in trust
by the Debtors and are not property of their estates. The Debtors seek authorizationbut not
directionpursuant to the Interim Order and the Final Order, to remit the Unremitted
Miscellaneous Deductions and continue remitting the Miscellaneous Deductions in the ordinary
course of business on a postpetition basis.
F. Employee Benefit Programs.
99. The Debtors offer Employees the opportunity to participate in one or more
insurance and benefit programs, including, medical, dental, and vision plans, life insurance, short
and long-term disability insurance, and other employee benefit plans as described below.
1. Health Benefit Plans.
100. As described below, I understand that the Debtors offer Employees that work
more than 20 hours per week the opportunity to participate in a number of health benefit plans,
including medical, prescription, dental, and vision plans (collectively, the Health Benefit

43

Plans), each as described in the Wages Motion.
101. Overall, I understand that the the Debtors fund approximately 80% of the costs
associated with the Health Benefit Plans and Employees fund the remainder. I understand that
the Debtors estimate that they deduct or remit an aggregate amount of approximately $1.0
million each month on account of the Employees under the Health Benefit Plans and pay an
aggregate amount of approximately $5.5 million each month on account of administrative fees,
premiums, and claims under the Health Benefit Plans (collectively, the Health Benefit
Amounts). I understand that the Debtors estimate that, as of the Petition Date, they owe
approximately $5.5 million on account of the Health Benefit Amounts (the Unpaid Health
Benefit Claims and Fees), all of which will become due and owing within the Interim Period.
102. I understand that the Health Benefit Plans are customary for most large
companies, and consequently, Employees and their dependents have come to rely on the Health
Benefit Plans. Without the Health Benefit Plans, I believe that employees would be forced to
obtain potentially prohibitively expensive out-of-pocket coverage, which would adversely affect
Employee morale. In addition, I understand from counsel to the Debtors believe that deductions
taken from Employee paychecks on account of the Health Benefit Plans are generally held in
trust by the Debtors and are not property of their estates.
2. Health Savings Account.
103. I understand that in connection with the Medical Insurance Plans, Employees may
opt to participate in the Health Savings Account plan (the HSA). I understand that under the
HSA, the Debtor entity EFH Corporate Services contributes between $900 and $2,250 each year
on behalf of participating Employees. I understand that EFH Corporate Services has already
contributed such amounts for 2014 on behalf of participating Employees in an aggregate amount
of approximately $5.4 million. That being said, I understand that the Debtors are obligated to

44

contribute amounts on behalf of (i) Employees who were hired after the 2014 funding and who
opt to participate in the HSA and (ii) Employees who did not complete the activities required to
receive contributions from the Debtors before the 2014 funding but subsequently completed such
activities. I understand that as of the Petition Date, the Debtors believe they owe approximately
$50,000 in prepetition amounts on account of the HSA (the Unpaid HSA).
3. Flexible Spending Accounts.

104. I understand that the Debtors offer Employees that work more than 20 hours per
week the ability to contribute a portion of their pre-tax compensation to flexible spending
accounts to pay for certain out-of-pocket health care and dependent care expenses (the
Flexible Spending Program). I understand that approximately 630 Employees participate in
the health care portion of the Flexible Spending Program. I understand that at the beginning of
each year, participating Employees contribute anywhere from $200 to $2,500 on behalf of
themselves and anywhere from $200 to $5,000 on behalf of their dependents by deducting such
amounts from their paychecks. I understand that all FSA amounts were available for distribution
in January 2014 and are deducted from employees paychecks throughout the year.
105. I understand that as of the Petition Date, the Debtors do not believe they owe any
prepetition amounts on account of the Flexible Spending Program.
4. Insurance.
a. Life Insurance.
106. I understand that the Debtors provide approximately 5,650 Employees that work
more than 20 hours per week with primary and split-dollar life insurance (the Life Insurance)
through Metropolitan Life Insurance Company. I understand that the Debtors provide eligible
Employees with Life Insurance up to each Employees base salary at no cost to the Employee.
107. I understand that the coverage provided by these various policies costs the

45

Debtors approximately $200,000 per month (the Life Insurance Amounts). I understand that
as of the Petition Date, the Debtors estimate that there are approximately $200,000 in prepetition
amounts to be deducted and/or remitted on account of the Life Insurance Amounts. I understand
that the Debtors estimate that approximately $200,000 will become due and owing on account of
the Life Insurance Amounts within the Interim Period (the Unpaid Life Insurance Premiums).
108. I understand that many Employees long-term planning consists solely of the Life
Insurance coverage they receive as a benefit of their employment. I believe that continuing Life
Insurance coverage is essential to maintaining Employee morale and protecting Employee
expectations and protecting their families from the impact of a catastrophic event.
b. Disability Benefits.
109. I understand that the Debtors provide approximately 5,650 Employees that work
more than 20 hours per week with long-term disability benefits, administered through
Metropolitan Life Insurance Company (the Long-Term Disability Benefits). I understand that
the Debtors also provide Employees that work more than 30 hours per week with short-term
disability benefits (the Short-Term Disability Benefits, and, together with the Long-Term
Disability Benefits, the Disability Benefits), administered through Metropolitan Life Insurance
Company. I understand that the Short-Term Disability Benefits are self-insured and are not
subject to any limits. I also understand that the Long-Term Disability Benefits are fully insured
under a policy that costs the Debtors approximately $200,000 per month. I understand that the
Debtors pay 100% of the costs for the Disability Benefits, and the coverage provided by these
various policies costs approximately $200,000 per month. I understand the Debtors pay 100% of
the costs for the Disability Benefits.
110. Under the Short-Term Disability Benefits program, I understand that eligible
Employees receive three weeks of benefits at 100% of their base pay and ten weeks of benefits at

46

50% of base pay after six months to a year of service for new Employees. I understand that after
one and up to five years of service, eligible Employees receive 13 weeks of benefits at 100% of
base pay and 13 weeks of benefits at 50% of base pay. I also understand that after five years of
service, eligible Employees receive up to 26 weeks of benefits at 100% of base pay. I
understand that the Short-Term Disability Benefits program was implemented in 2011, and
Employees hired before that time are entitled to 100% of base pay for up to 26 weeks.
111. On average, I understand that the Debtors pay approximately $200,000 per month
on account of the Disability Benefits. I understand that as of the Petition Date, the Debtors
estimate that they are obligated to deduct and/or remit approximately $200,000 on account of the
Disability Benefits (the Unpaid Disability Benefit Premiums), all of which will become due
and owing in the Interim Period.
112. I understand that the vast majority of Employees rely on Disability Benefits as
their sole form of wage-loss relief. Thus, I believe that Employees will suffer substantial losses
if they are not permitted to receive Disability Benefits.
c. Supplemental Insurance.
113. I understand that approximately 5,650 Employees that work more than 20 hours
per week may purchase supplemental coverage on their life, critical illness, and accidental death
and dismemberment policies (for themselves and their dependents), administered through
Metropolitan Life Insurance Company and Boston Mutual (collectively, the
Supplemental Insurance). I understand that eligible Employees may purchase Supplemental
Insurance in an aggregate amount no greater than six times their annual base salary, up to a limit
of $2 million. I understand that the Supplemental Insurance is 100% paid by deductions from
participating Employees monthly paychecks.
114. I understand that the Debtors deduct or remit approximately $700,000 per month

47

on account of Supplemental Insurance (the Supplemental Insurance Amounts). As of the
Petition Date, the Debtors estimate that there are approximately $700,000 in prepetition amounts
to be deducted and/or remitted to Metropolitan Life Insurance Company on account of the
Supplemental Insurance Amounts. I understand that the Debtors estimate that they will be
obligated to remit approximately $700,000 in deductions (taken on account of the premiums
owed by the approximately 3,500 Employees that have elected Supplemental Insurance
Coverage), within the Interim Period (the Unremitted Supplemental Insurance Amounts).
115. I understand from Debtors counsel that the Supplemental Insurance Amounts are
generally held in trust by the Debtors and are not property of their estates. The Debtors seek
authorizationbut not directionpursuant to the Interim Order and the Final Order, to remit the
Unremitted Supplemental Insurance Amounts and continue Supplemental Insurance coverage in
the ordinary course of business on a postpetition basis.
5. The 401(k) Plan.
116. I understand that the Debtors maintain a retirement savings plan for the benefit of
their Employees who are at least 18 years old and have completed at least six months of eligible
service, in accordance with the requirements of section 401(k) of the Internal Revenue Code
(the 401(k) Plan). I understand that approximately 5,300 Employees currently participate in
the 401(k) Plan.
117. I understand that in addition to making contributions to their 401(k) Plan account,
all Employees have the option to take out a loan from their 401(k) Plan account. I understand
that the Debtors then deduct certain amounts from such Employees paychecks and remit those
amounts for repayment of such loans. I understand that the Debtors deduct approximately $4.0
million in the aggregate each month from Employees paychecks (a) on account of Employees
401(k) contributions and (b) to repay Employees 401(k) loans (which are capped at the lesser of

48

50% of the amount in a particular Employees 401(k) account or $50,000) (collectively, the
401(k) Deductions). As of the Petition Date, the Debtors estimate that they will be obligated
to remit approximately $1.7 million on account of the 401(k) Deductions (the Unremitted
401(k) Deductions), all of which will become due and owing within the Interim Period.
118. I understand that the Debtors also have a limited matching program under the
401(k) Plan (the 401(k) Matching Obligation). Specifically, I understand that the Debtors
match: (a) 100% of an Employees contributions, up to 6% of the Employees salary, if the
Employee does not participate in a defined benefit program or if they participate in the cash
balance formula of the defined benefit plan; and (b) 75% of an Employees contributions, up to
6% of the Employees salary, if the Employee participates in the traditional formula of the
defined benefit plan. I understand that the Debtors paid approximately $23.2 million in 2013 and
$6.0 million in the first quarter of 2014 on account of the 401(k) Matching Obligation. I
understand that as of the Petition Date, the Debtors estimate that they owe approximately
$1,000,000 on account of the 401(k) Matching Obligation (the Unpaid 401(k) Matching
Obligation), all of which will become due and owing within the Interim Period.
119. The 401(k) Plan is administered by Fidelity Workplace Services LLC
(Fidelity Workplace) and by other specialized vendors. I understand that the Debtors pay
these administrators approximately $180,000 in the aggregate each month on account of
administrative fees owed to Fidelity Workplace (the 401(k) Administrative Fees). I also
understand that as of the Petition Date, the Debtors estimate that they owe approximately
$180,000 in 401(k) Administrative Fees earned before the Petition Date (the Unpaid 401(k)
Administrative Fees), all of which will become due and owing within the Interim Period.
120. I believe many Employees retirement savings solely consist of the 401(k) Plan,

49

and many Employees choose to participate in the 401(k) Plan because of the 401(k) Matching
Obligation provision. Thus, I believe that continuing the 401(k) Plan and the 401(k) Matching
Obligation is essential to maintaining Employee morale and protecting Employee expectations.
In addition, I understand from Debtors counsel that the 401(k) Deductions are generally held in
trust by the Debtors and are not property of their estates.
G. Workers Compensation.
121. I understand that the Debtors provide workers compensation insurance for their
Employees at the level required by statute for each state in which the Debtors have Employees
(collectively, the Workers Compensation Program).
32
The Debtors maintain the Workers
Compensation Program through Liberty Mutual Group, STARR, Kemper, and Reliance
Insurance (the Workers Compensation Insurers). I understand that the Debtors have a $2
million deductible per occurrence under the Workers Compensation Program.
122. I understand that on average, the Debtors pay approximately $1.4 million per year
in fees and premiums on account of the Workers Compensation Program (the Workers
Compensation Coverage Fees). I understand that the Debtors estimate that they do not owe any
amounts on account of Workers Compensation Coverage Fees as of the Petition Date.
123. Additionally, I understand that the Debtors incur an average of approximately
$1.4 million in workers compensation claims per year, and pay an average of approximately
$1.3 million per year on account of such incurred claims. I understand that third-party
administratorsCrawford & Company, York Risk Services Group, Inc., and one of the

32
I understand that the Debtors workers compensation policies entitle the Debtors to protection when benefits
are due to Employees under the following states workers compensation laws: (a) Arizona; (b) District of
Columbia; (c) Georgia; (d) Maryland; (e) Maine; (f) New York; (g) South Carolina; and (h) Texas. I
understand from Debtors counsel that although Texas does not require employers to maintain a Workers
Compensation Program, the Debtors have not opted out of the Texas Workers Compensation Act. Additional
states are also covered in previous years.

50

Workers Compensation Insurers, Liberty Mutual groupcollect and process claims submitted
pursuant to the Workers Compensation Program in exchange for an administrative fee
(Workers Compensation Administrative Fees).
124. On average, I understand that the Debtors pay approximately $20,000 per month
in Workers Compensation Administrative Fees. I understand that as of the Petition Date, the
Debtors estimate that they owe approximately $20,000 in Workers Compensation
Administrative Fees (Unpaid Workers Compensation Administrative Fees), all of which will
come due and owing within the Interim Period.
125. I understand that certain benefits under the Workers Compensation Program may
have been incurred prepetition but have yet to be fully paid, and certain other claims may have
been filed prepetition but have yet to be resolved (collectively, the Unpaid Workers
Compensation Claims). I understand from Debtors counsel that for the claims administration
process to operate in an efficient manner and to ensure that the Debtors comply with their
contractual obligations, the Debtors must continue to assess, determine, and adjudicate Unpaid
Workers Compensation Claims during these chapter 11 cases. In addition, I understand that to
the extent any of the Employees assert claims under the Workers Compensation Program, the
Debtors request that the Court modify the automatic stay under section 362 of the Bankruptcy
Code to permit the Employees to proceed with their claims under the Workers Compensation
Program. I understand from Debtors counsel that the required modification of the automatic
stay pertains solely to claims under the Workers Compensation Program.
126. I understand from Debtors counsel that because the Debtors are statutorily and/or
contractually obligated to maintain the Workers Compensation Program, their inability to do so
may result in adverse legal consequences that disrupt the reorganization process.

51

H. Vacation, Holiday and Other Leave of Absence Time.
127. I understand that the Debtors provide vacation time to all full-time Employees
other than union Employees as a paid time-off (PTO) benefit (the Vacation Time).
33
I also
understand that the length of employment generally determines the amount of Vacation Time
available to each eligible Employee and the rate at which such Vacation Time accrues. I
understand that the amount of available Vacation Time differs between Luminant Employees and
all other Employees. In addition, I understand that Vacation Time for Luminant Employees is
earned January 1 of each year (e.g., a Luminant Employee receives 15 days of vacation
beginning January 1 of the calendar year that the Employee will have served six years of
service), while Vacation time for all other Employees is accrued each pay period.
128. Luminant Employees. I understand that the amount of Vacation Time that each
eligible Luminant Employee can take is based on the number of years of continuous full-time
employment, as follows:
six days of Vacation Time for six months to 10 months of employment;
10 days of Vacation Time for 10 months of employment to six years of
employment;
15 days of Vacation Time for six to 14 years of employment;
20 days of Vacation Time for 15 to 23 years of employment; and
25 days of Vacation Time for 24 or more years of employment.
129. I understand that the Luminant Vacation Time amounts differ slightly for
Luminant Employees that work in nuclear operations, at lignite plants, or at certain mine sites.
Employees who do not use all of their accrued Vacation Time in a year may carry over accrued,
unused Vacation Time to the next year, up to a maximum of 48 hours.

33
All full-time Employees are entitled to the Vacation Time benefits, with the exception of union Employees (as
described in the Wages Motion).

52

130. All Other Employees. I understand that the amount of Vacation Time that each
eligible non-Luminant Employee can take is based on the number of years of continuous full-
time employment, as follows:
34

17 days of Vacation Time for zero to four years of employment;
22 days of Vacation Time for five to nine years of employment;
27 days of Vacation Time for 10 to 19 years of employment; and
32 days of Vacation Time for 20 or more years of employment.
131. And I understand that Employees who do not use all of their accrued Vacation
Time in a year may carry over accrued, unused Vacation Time to the next year, up to a maximum
of 40 hours.
132. I understand that all Employees who are eligible to take Vacation Time and who
terminate their employment for any reason are entitled to the cash equivalent of any accrued but
unused Vacation Time through their termination date. I understand that the Debtors have
approximately $32.0 million of total cash and non-cash accrued obligations on account of
Vacation Time. I understand that on average, the Debtors pay approximately $200,000 per
month on account of cash obligations associated with the accrued but unused Vacation Time of
terminated Employees. I understand that as of the Petition Date, the Debtors estimate they owe
an aggregate amount of approximately $200,000 in cash obligations on account of accrued
Vacation Time (the Unpaid Vacation Time), all of which will come due within the Interim
Period.
133. In addition, I understand that the Debtors recognize eight to ten core holidays as a

34
The Luminant Vacation Time policies do not include sick-time. Luminant Employees are entitled to take sick
leave but do not accrue sick leave benefits. Therefore, the Debtors do not have any cash obligations associated
with accrued but unused sick-time on behalf of Luminant Employees.

53

PTO benefit for certain of their Employees (each, a Holiday and, collectively, the
Holidays).
35
Generally, eligible Employees are not required to work on designated Holidays
and are paid for Holiday time at their base rate of pay. Employees who are required to work on
designated Holidays are paid in accordance with the applicable Debtors Holiday pay rates.
134. On average, I understand that the Debtors pay approximately $17.0 million per
year on account of the Holiday policies. I understand that as of the Petition Date, the Debtors do
not estimate they owe any amounts account of Holiday obligations.
135. Employees may also take certain other unpaid leaves of absence for personal
reasons (collectively, Leave of Absence Time). Leave of Absence Time includes family
medical leaves, pregnancy, adoption and foster care leaves, military leaves, jury duty, voting
leaves, personal leaves, and bereavement leaves.
36
Employees are not entitled to cash payments
for unused Leave of Absence Time. Thus, I understand that there are no obligations owing as of
the Petition Date on account of Leave of Absence Time.
136. I believe that the continuation of the Vacation Time, Holiday, and Leave of
Absence Time policies in accordance with prior practice (subject to the limitations described
below), is essential to maintaining Employee morale during these chapter 11 cases. Further, I
understand that the policies are broad-based programs upon which all Employees have come to
depend.
137. I understand that the Debtors anticipate that their Employees will utilize any

35
I understand that all full-time Employees are entitled to take Holidays. Full-time Employees of the Luminant
entities are further entitled to two floating Holidays. I understand that floating Holidays must be taken if the
Employee is to receive pay for it as a Holiday. I also understand that holiday premium pay may be earned on a
floating Holiday only if the Employee is called to work because of an emergency.
36
I understand that Employees taking a military Leave of Absence to serve a regular tour of duty receive pay for
all PTO benefits granted and accrued but not used before the effective date of the Leave of Absence. I
understand that such Employees do not receive any other pay during the tour of duty.

54

accrued Vacation Time, Holiday, and Leave of Absence Time in the ordinary course of business,
and, therefore, the Debtors do not expect there to be any material cash requirements beyond the
Debtors normal payroll obligations on account of the relief requested in the Wages Motion.
I. Retiree Compensation and Benefits.
138. I understand that the Debtors maintain one qualified defined benefit pension plan
that provides benefits to the approximately 2,100 union Employees (the Union Pension Plan).
I understand that the Debtors also provide certain benefits (the Retiree Medical Benefits) to
approximately 4,600 retired Employees and Oncors retired employees, (collectively, the
Retirees), and such Retirees eligible dependents.
1. The Union Pension Plan.
139. I understand that the Debtors plan to continue to make any and all contributions
on account of the Union Pension Plan (the Union Pension Plan Obligations) as required by
applicable law and various contractual obligations. For 2014, I understand that the Debtors made
their annual contribution of approximately $20.0 million on behalf of the Union Pension Plan.
2. Retiree Medical Benefits.
140. I understand that the Debtors sponsor Retiree Medical Benefits for the Retirees
and their eligible dependents. I understand that in March of 2005, the Debtors and Oncor entered
into an allocation agreement, under which Oncor assumed the retiree medical benefit obligations
for (a) all of its active and retired employees and (b) Debtor active and retired Employees for the
amounts earned by such Employees pursuant to their service prior to the deregulation and
disaggregation of the Debtors and Oncors combined predecessor electric utility business
effective January 1, 2002. As a result of this agreement, I understand that although the Debtors
sponsor the Retiree Medical Benefits, Oncor is obligated to satisfy the vast majority of the
Retiree Medical Benefits obligations. I understand that as of December 31, 2013,

55

approximately 88% of the Retiree Medical Benefits liability was attributable to Oncor.
141. I understand that the Debtors and Oncor are responsible for satisfying their
portion of Retiree Medical Benefits liability.
142. I understand that generally, the medical coverage offered to the Retirees differs
based on the specific plan in which a Retiree chooses to participate, and participant costs differ
based on the chosen plan, whether the Retirees dependents are covered by the chosen plan, and
the Retirees years of service and associated rate band. On average, I understand that the
Debtors pay approximately $700,000 million each month to the VEBA Trusts to sponsor the
Retiree Medical Benefits on behalf of the Retirees. I understand that as of the Petition Date, the
Debtors estimate that they owe approximately $700,000 million on account of sponsoring the
Retiree Medical Benefits (the Unpaid Retiree Medical Benefit Claims and Fees), all of which
will become due and owing within the Interim Period.
143. I understand from Debtors counsel that the Debtors currently are obligated to
provide Retiree Medical Benefits under section 1114 of the Bankruptcy Code. In addition, I
believe that it is important that the Debtors continue to provide Retiree Medical Benefits to
reassure all Employees that the Debtors intend to honor their obligations to Employeesboth
during and after their tenure with the Debtors.
J. Severance Program.
1. Severance Payments.
144. I understand that the Debtors have historically maintained a severance program
under which all Employees are entitled to a certain number of weeks of severance benefits based
on their position and length of service with the Debtors, as well as post-employment benefits
under the Health Benefit Plans (the Severance Program).
145. I understand that the payments under the Severance Program are not due and

56

payable until termination. I understand that as a basis for comparison, between the years of 2010
and 2013, the Debtors paid an average of $4 million on behalf of the Severance Program. I
understand that this average reflects an atypical reduction in workforce in 2011, and, in fact, the
Debtors paid less than $3 million in each of the last two years on account of the Severance
Program. Importantly, I understand that as of the Petition Date, no cash amounts remain
outstanding on account of the Severance Program.
146. I believe that it is important that the Debtors fulfill their obligations under the
Severance Program to reassure all Employees that the Debtors intend to honor their obligations
to non-insider Employeesboth during and after their tenure with the Debtorsincluding those
obligations incurred postpetition under the Severance Program.
2. COBRA Reimbursements.
147. I understand that the Debtors reimburse former Employees for deductions taken
on account of Consolidated Omnibus Budget Reconciliation Act (COBRA) expenses for the
duration of their severance benefits. Under COBRA, I understand that the Debtors are obligated
to offer former Employees and their dependents continued coverage under the Health Benefit
Plans for a period of up to eighteen months. I understand that the Debtors provide these
reimbursements through a third-party administrator, Chard Snyder. I understand that
approximately 40 former Employees participate in one or more Health Benefit Plans under
COBRA. I understand that on average, the Debtors remit approximately $20,000 per month on
account of COBRA reimbursements to Chard Snyder for former Employees (the COBRA
Reimbursements).
148. I understand that as of the Petition Date, the Debtors estimate that they owe
$20,000 on account of COBRA Reimbursements (Unpaid COBRA Claims and Fees).

57

K. Other Employee Programs and Benefits.
1. Relocation Expenses.
149. I understand that the Debtors provide certain Employees with relocation-related
expenses (collectively, the Relocation Expenses) to incentivize desirable new-hire
candidates to accept positions with the Debtors or incentivize existing Employees to accept
transfers to other locations. I understand that on average, the Debtors pay approximately
$150,000 per month on account of Relocation Expenses. I understand that as of the Petition
Date, the Debtors estimate that they owe $150,000 on account of prepetition Relocation
Expenses (Unpaid Relocation Expenses), all of which will come due during the Interim Period.
150. I believe that it is critical that the Debtors be able to pay Relocation Expenses to
attract and retain talented employees, as well as to ensure, among other things, that Employees
will be reimbursed for the expenses incurred in connection with their moves for the Debtors
benefit.
2. Tuition Reimbursement Expenses.
151. I understand that the Debtors provide tuition assistance for eligible Employees
who study in fields related to the Debtors businesses (the Tuition Reimbursement Expenses).
I understand that Employees are eligible to participate in the program if they work more than 20
hours per week, not including temporary workers or interns. I understand that on average, the
Debtors pay approximately $60,000 per month on account of Tuition Reimbursement Expenses.
I understand that as of the Petition Date, the Debtors estimate that they owe approximately
$60,000 on account of Tuition Reimbursement Expenses (the Unpaid Tuition Reimbursement
Expenses), all of which will come due during the Interim Period.
152. I believe that it is important that the Debtors be permitted to reimburse Employees
for their tuition costs to ensure that the Debtors remain a competitive and knowledgeable

58

presence in the energy industry.
3. Commuter Assistance Program.
153. The Debtors subsidize eligible Employees for their car pool, bus, and rail costs
(the Commuter Assistance Program). On average, I understand that the Debtors prepay the
costs to administer the Commuter Assistance Program in January of each year (approximately
$230,000 for the year). I understand that as of the Petition Date, the Debtors do not believe there
are any prepetition amounts on account of the Commuter Assistance Program, and the Debtors
do not believe that any amounts will become due and owing during the Interim Period.
4. Survivors Benefit Program.
154. I understand that the Debtors pay a benefit equal to one month of an Employees
base salary to an Employees beneficiary upon death (the Survivors Benefit Program). I
understand that as of the Petition Date, the Debtors estimate that there are no amounts
outstanding under the Survivors Benefit Program.
5. Employee Financing Programs.
155. I understand that the Debtors have two programs in place in which they offer
interest-free financing to Employees for appliances, including one for certain energy saving
home appliances (the Energy Conservation Program), and another for certain other large
household appliances, such as a dishwasher or clothes dryer (the Appliance Financing
Program, and together with the Energy Conservation Program, the Employee Financing
Programs). I understand that the Energy Conservation Program has a maximum financing limit
of $3,500 over a term of up to 60 months, and the Appliance Financing Program has a maximum
financing limit of $2,000 over a term of up to 24 months. I understand that the Debtors pay
approximately $1.2 million per year on account of the Employee Financing Programs. I
understand that as of the Petition Date, the Debtors do not believe they owe any amounts on

59

account of prepetition obligations related to the Employee Financing Programs.
156. I understand that the Employee Financing Programs provide significant financing
savings to those Employees who participate.
6. United Way Matching Program.
157. I understand that the Debtors maintain a matching program for Employee
contributions to local chapters of United Way, a non-profit organization dedicated to identifying
and resolving pressing community issues (the United Way Matching Contributions). I
understand that for every $1.00 that Employees donate to local United Way chapters, the Debtors
contribute $0.50 in United Way Matching Contributions. I understand that on an annual basis,
the Debtors contribute approximately $430,000 in United Way Matching Contributions.
7. Energy Aid Program.
158. I understand that the Debtors maintain a matching program for customer and
employee contributions to local communities (the Energy Aid Program). I understand that the
Energy Aid Program is the largest bill-payment assistance program among electricity providers
in the nation. I understand that the Debtors Employees contribute to the Energy Aid Program
through paycheck deductions, and the Debtors match Employee contributions (the Energy Aid
Matching Contributions).
37
I understand that for 2013, the Debtors contributed approximately
$1.5 million in Energy Aid Matching Contributions on account of employee deductions.
159. I understand that as of the Petition Date, the Debtors estimate that they owe
$210,000 on account of prepetition obligations related to the Energy Aid Matching Contributions
(the Unpaid Energy Aid Matching Contributions), all of which will come due during the
Interim Period.

37
I understand that the Debtors also match customer donations to the Energy Aid Program: for every $1.00 that
customers donate to the Energy Aid Program, the Debtors contribute $5.00 to local communities to help
individuals pay their electricity bills.

60

L. Unions.
160. I understand that approximately 2,100 Employees are represented by unions that
are party to 11 CBAs with the International Brotherhood of Electrical Workers (the IBEW).
161. I understand from Debtors counsel that the Debtors are required to withhold
union member dues, and typically remit such dues on a monthly basis to the IBEW (collectively,
the Union Dues). I understand that on average, the Debtors remit approximately $100,000 per
month on account of the Union Dues. I understand that as of the Petition Date, the Debtors
estimate they have collected approximately $100,000 in Union Dues that they have not yet
transferred to the IBEW (the Unremitted Union Dues), all of which will become due and
owing to the IBEW during the Interim Period. I understand that the Debtors generally hold the
Union Dues in trust and as a result, the Debtors generally do not consider these as assets of their
estates.
M. Relationship with Oncor.
162. I understand that the Debtors also provide and administer benefits to eligible
Oncor employees, retirees, and dependents with respect to certain Employee Programs including,
among others: (a) the Health Benefit Plans; (b) the Flexible Spending Program; (c) the 401(k)
Plan; and (d) the Retiree Medical Benefits. In the aggregate, I understand that the Debtors
historically spend approximately $250,000 per year to provide and administer such benefits on
behalf of eligible Oncor employees, retirees, and dependents. Importantly, however, I
understand that Oncor reimburses the Debtors for the vast majority of these costs and many of
the Debtors activities in respect of Oncor employees, retirees, and dependents are administrative
in nature. I understand that after accounting for Oncors typical reimbursements to the Debtors,
the Debtors generally spend approximately $250,000 per year to provide and administer such
benefits on behalf of eligible Oncor employees, retirees, and dependents.

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Critical Vendors Motion.
38
VI.
163. In the Critical Vendors Motion, the the Debtors seek entry of orders: (a) schedule
a final hearing as soon as practicable after the 21st day following the Petition Date (defined in
the Critical Vendors Motion) to consider approval of the Critical Vendors Motion on a final basis
(the Final Hearing); (b) after the Final Hearing, permit the Debtors to pay Critical Vendor
Claims up to $40 million; and (c) authorize all applicable banks and financial institutions to
receive, process, honor, and pay all checks presented for payment and all electronic payment
requests made by the Debtors related to the Critical Vendor Claims, whether such checks were
presented or electronic-payment requests were submitted before or after the Petition Date.
A. Debtors Process of Identifying Critical Vendors.
164. I understand that the Debtors purchase goods and services from more than 6,700
third-party vendors. I understand that these third-party vendors provide a host of goods and
services that are important to the continued and uninterrupted operation of the Debtors
businesses. I understand that the Debtors estimate they owe approximately $507 million to their
third-party vendors as of the Petition Date.
165. Recognizing that payment of all prepetition claims of such third-party vendors
outside of a plan of reorganization would be extraordinary given the facts and circumstances of
these cases, I understand that the Debtors spent significant time and effort reviewing their
accounts payable and vendor lists to identify those vendors critical to the continued and
uninterrupted operation of the Debtors businesses (the Critical Vendors). In identifying the
Critical Vendors, the Debtors examined each of their vendor relationships with the following
criteria in mind:

38
See Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders Authorizing the
Debtors to Pay Prepetition Critical Vendor Claims, filed contemporaneously herewith.

62

whether a particular vendor is a sole source supplier or
service provider;
whether the services provided by the vendor are so vital, or
the vendors operations are so commingled with the
Debtors business, that even the briefest disruption would
cause significant harm to the Debtors;
whether the Debtors would be unable to obtain comparable
products or services from alternative sources on a
cost-effective basis within a reasonable timeframe;
whether the Debtors inventory levels or service coverage
is sufficient to meet customer demands while an alternative
vendor is located;
whether a vendor meeting the foregoing criteria is able or
likely to refuse providing essential products or services to
the Debtors if their prepetition balances are not paid; and
whether the business relationship between the Debtors and
the supplier is governed by a contract.
166. Applying these criteria, I understand that the Debtors estimate that they owe
approximately $40 million to the Critical Vendors on account of goods and services delivered
before the Petition Date. Accordingly, I understand that the Debtors seek authority to pay up to
$30 million pursuant to the Interim Order and $40 million pursuant to the Final Order. I
understand that these amounts represent approximately 8.0% of the Debtors outstanding trade
debt and approximately 0.1% of the Debtors total funded indebtedness as of the Petition Date.
B. Summary of the Critical Vendors.
167. I understand that the Critical Vendors generally fall into one of the following five
categories: (a) vendors that provide goods and services related to planned maintenance outages:
(b) vendors that provide services and related goods that are highly specialized and/or closely
integrated with the Debtors business operations and customer relationships; (c) sole source or
geographically limited providers of critical goods; (d) vendors that provide goods and services

63

related to regulatory compliance obligations; and (e) vendors that provide goods and services
related to the Debtors nuclear power plant at Comanche Peak.
39

1. Outage Vendors.
168. I understand that the Debtors utilize the services of a variety of Critical Vendors
in connection with planned maintenance outages of certain of the Debtors plants (the Outage
Vendors). I further understand that in preparation for and during planned outages, the Debtors
schedule maintenance, repairs, replacements, upgrades, refueling, refurbishing, and stress-testing
on their generation and mining assets, all in an effort to ensure that their assets are in optimal
condition before peak electricity season begins and out of service for the least amount of time
possible.
169. Based on the information available to me, I believe that any delay in goods and
services from the Outage Vendors would likely extend a planned outage at significant cost to the
Debtors estates and/or unfavorably affect the operational reliability of the Debtors generation
and mining assets and the overall reliability of the ERCOT electricity market. As a result, I
understand that the Debtors believe that the services provided by the Outage Vendors are so vital
that the costs of even the briefest disruption would exceed the prepetition claims owing to the
Outage Vendors.
170. Additionally, I understand from Debtors counsel that certain of the Outage
Vendors may not be subject to executory contracts and the Debtors believe that these Outage
Vendors may refuse to continue doing business with the Debtors if they are not paid their

39
The Debtors have agreed not to knowingly pay Critical Vendor Claims to any Critical Vendor that is an affiliate
or insider, as defined in sections 101(2) and 101(31) of the Bankruptcy Code, respectively, of the Debtor, with
the exception of portfolio companies owed by EFH Corp.s indirect equity holders with which the Debtors
conduct arms-length transactions. The Debtors request that they only be required to conduct a reasonable
inquiry under the circumstances with respect to whether a particular Critical Vendor is an affiliate or insider.

64

prepetition claims. Accordingly, I understand that the Debtors believe that payment of the
Outage Vendors prepetition claims will benefit their estates.
2. Specialized and Integrated Services Vendors.
171. I understand that the Debtors rely on specialized labor services and other services
that are closely integrated with the Debtors generation and retail business operations provided
by certain Critical Vendors (collectively, the Integrated Services Vendors).
172. In certain cases, I understand that the Debtors can only obtain services from
Integrated Services Vendors who have certifications, permits, or licenses as required by state or
federal laws and regulations. I understand that certain services that could otherwise be
performed by a wide range of vendors (e.g., welding, electrical, waste removal, earth moving,
security, and cyber security services) can only be performed by certain Integrated Services
Vendors due to the risks posed by the nature of the Debtors facilities, which expose Integrated
Services Vendors to, among other things, high speed rotation motors, toxic and radioactive
substances, high voltage electricity, and high pressure vessels, as well as the additional dangers
inherent in maintaining mining operations. Other customer-facing services are vital to the
Debtors customer relationships and business strategy given the highly competitive Texas
electricity market and the Debtors emphasis on reliability and customer service to differentiate
themselves from other market participants. I believe it is vital that these customer-facing
services are not negatively affected by, for example, dissatisfied vendors or the need to obtain
new vendors.
173. I understand that even if alternative service providers who possess the necessary
qualifications, experience, and skills could be identified in a timely fashion, the Integrated
Services Vendors have specific experiential knowledge about the Debtors business operations,

65

facilities, and customer demandsdeveloped over the course of the Integrated Services
Vendors long-standing relationship with the Debtorsthat cannot be replaced.
174. I believe that some of the Integrated Services Vendors will refuse to provide
postpetition services to the Debtors if all or a portion of their prepetition claims are not satisfied.
I understand that the Debtors have determined that the harm that would be inflicted on the
Debtors businesses by an interruption in service greatly outweighs the cost of paying the
prepetition claims of the Integrated Services Vendors. Although the Debtors will make every
effort to obtain continued performance from the Integrated Services Vendors and, where
applicable, would seek to enforce the automatic stay against Integrated Services Vendors who
refuse to perform under valid prepetition agreements, due to the integrated nature of all of the
services, limited availability of comparable vendors able to provide the Debtors with certain
specialized services, and customer-facing nature of other services, it is vitally important that
these services continue. Therefore, I believe it is critical that they have the discretion to satisfy
certain of the prepetition claims of the Integrated Services Vendors.
3. Critical Goods Vendors.
175. I understand that the Debtors rely on a number of Critical Vendors to supply
essential raw materials, fuels, specialized replacement parts and supplies, operations
consumables, and certain other goods and services required to operate the Debtors plants and
continue their business operations (collectively, and as described in the Critical Vendors Motion,
the Critical Goods Vendors and Critical Goods). In some cases, I understand that there is no
alternative provider for certain Critical Goods. For example, I understand that certain Critical
Goods Vendors supply the Debtors with specially fabricated repair and replacement parts for the
turbines, transformers, boilers, and other equipment used in the Debtors electricity generation
and lignite mining operations. I understand that this equipment is generally based on patented

66

designs available only from the manufacturer or that is made or provided to the Debtors exact
specifications.
176. In other cases, I understand that alternative suppliers cannot supply the required
Critical Goods in sufficient quantity, quality, or reliability, or they are unable to supply the
required Critical Goods on a cost-efficient and timely basis in the appropriate geographic areas.
For example, the Debtors plants are designed to utilize bulk quantities of certain laboratory
grade chemicals as part of their energy production and pollution control activities. Due to the
chemical specifications and quantities involved, I understand that the Debtors are dependent on a
few Critical Vendors that can provide such chemicals to their plants to keep the plants running
and compliant with environmental regulations. I understand that similarly, certain raw materials
and fuels used in the Debtors business operations, including raw materials that are necessary for
the Debtors compliance with environmental regulatory requirements, are locally sourced
because they are expensive and inefficient to transport. I also understand that in any one of these
locales, there may be only one potential counterparty to provide the Debtors with these raw
materials and fuels.
177. Accordingly, I understand that the Debtors have determined that they must be
able, in their sole discretion, to satisfy certain of the prepetition claims of these Critical Goods
Vendors to ensure the continued delivery of the Critical Goods to their plants and operational
locations.
4. Regulatory Compliance Vendors.
178. I understand that the Debtors rely on a number of Critical Vendors to assist the
Debtors in complying with applicable governmental laws and regulations (the Regulatory
Compliance Vendors). For example, the Debtors rely on certain vendors to remove regulated
waste and chemicals from the Debtors facilities for proper disposal and vendors who perform

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emissions testing and other critical compliance activities. I understand that other vendors ensure
the Debtors compliance with requirements under applicable permits and regulations related to
the Debtors generation, wholesale, and retail activities and related services.
179. I understand that some of the Regulatory Compliance Vendors may refuse to
perform postpetition services if their prepetition claims are not paid, thereby exposing the
Debtors to the risk of noncompliance with applicable governmental laws and regulations. I also
understand that even the slightest delay could cause governmental entities to attempt to levy
fines or penalties against the Debtors or require idling or closing of facilities and may put the
Debtors licenses and permits at risk. Moreover, I understand that proper disposal of the
regulated waste and chemicals and compliance with environmental requirements on an
uninterrupted basis will help to protect the environment and benefit the public health, including
that of the Debtors employees. Additionally, I understand that the public relations and
regulatory consequences that could result from even temporary noncompliance could have
meaningful negative results for the Debtors. For example, the Debtors are required to manage
and operate their property in compliance with all applicable state and federal laws and
regulations, and the automatic stay does not stay the exercise of police and regulatory powers by
regulators.
180. Accordingly, I believe that the Debtors ability, in their sole discretion, to pay the
Regulatory Compliance Vendors is essential to their reorganization efforts.
5. Nuclear Plant Vendors.
181. I understand that certain Critical Vendors provide goods and services related to
the Debtors nuclear generation units at Comanche Peak (the Nuclear Plant Vendors). I
understand that these goods and services may include general operations, maintenance, repairs,
inspections, refurbishments, fuel and parts, disposal services, quality control and assurance,

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physical plant security, and cyber security. I believe it is critical to both the Debtors business,
and as a matter of public safety, that the Debtors be permitted to pay the claims of Nuclear Plant
Vendors as necessary to avoid complications, disruptions, or increased safety risks in the
operation of their nuclear assets. I understand that the Debtors nuclear operations are subject to
extensive oversight from the Nuclear Regulatory Commission and other regulatory bodies. I also
understand that operational difficulties with respect to the Debtors current nuclear assets could
have significant regulatory consequences for those assets and the overall reliability of the
ERCOT electricity market.
182. I understand that although the Debtors will make every effort to obtain continued
performance from the Nuclear Plant Vendors and, where applicable, would seek to enforce the
automatic stay against Nuclear Plant Vendors who refuse to perform under valid prepetition
agreements, the Debtors believe that the importance of Comanche Peaks operations to the
Debtors and the the critical public safety and regulatory issues that could be presented by any
disruptions make continued performance vital. Accordingly, I understand that the Debtors have
determined that they must be able to satisfy certain of the prepetition claims of these Nuclear
Plant Vendors, in the Debtors discretion.
C. Terms and Conditions of Prepetition Payments.
183. I understand that subject to the Courts approval, the Debtors intend to pay the
Critical Vendor Claims only to the extent necessary to preserve their businesses. I also
understand that the Debtors have designated a core group of executives, consultants, and
employees who have experience in the Debtors business, as well as the reorganization process,
to review, assess, and potentially recommend payment to a Critical Vendor.
184. Moreover, I understand that the Debtors will use their commercially reasonable
efforts to condition payment of Critical Vendors Claims upon each Critical Vendors agreement

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to continue supplying goods and services on terms that are acceptable to the Debtors in light of
customary industry practices (the Customary Trade Terms).
185. Notwithstanding the Debtors commercially reasonable efforts to the contrary, I
understand that certain Critical Vendors may refuse to enter into a Vendor Agreement. I
understand that the Debtors request that they be granted the authority to pay Critical Vendor
Claims held by such Critical Vendors if the Debtors conclude, in their sole discretion, that such
payment is necessary for the preservation of the Debtors estates.
40

186. Additionally, I understand that the Debtors request that if a supplier or vendor
accepts payment pursuant to an order granting the relief requested in the Critical Vendors Motion
and thereafter does not continue to provide goods or services on prepetition trade terms that:
(a) any payment on account of a Critical Vendor Claim may be deemed, in the Debtors sole
discretion in consultation with counsel to the Ad Hoc Committee of TCEH First Lien Creditors,
to be an improper postpetition transfer, and, therefore, recoverable by the Debtors in cash upon
written request; and (b) upon recovery of the payment by the Debtors, the Critical Vendor Claim
shall be reinstated as if the payment had not been made. I understand that if there exists an
outstanding postpetition balance due from the Debtors to a vendor or supplier, the Debtors may
elect to recharacterize and apply any payment made pursuant to an order granting the relief
requested in the Critical Vendors Motion to such outstanding postpetition balance and such
supplier or vendor will be required to repay to the Debtors such paid amounts that exceed the

40
In the event any payments greater than $5 million are to be paid when (a) a Critical Vendor has not agreed to
execute a Vendor Agreement, or (b) the Debtors seek to execute a Vendor Agreement that is modified from the
version annexed as Exhibit 1 to Exhibit A, the Debtors have agreed to consult with counsel to certain holders of
first lien claims against TCEH (the Ad Hoc Committee of TCEH First Lien Creditors) before making such
payment or modifying the form of Vendor Agreement, as applicable.

70

postpetition obligations then outstanding without the right of any setoffs, claims, provisions for
payment of any claims, or otherwise.
41

Shippers, Warehousemen, and Materialmen Motion.
42
VII.
187. In the Shippers, Warehousemen, and Materialmen Motion, the the Debtors seek
entry of orders: (a) granting administrative expense priority to all undisputed obligations
the Outstanding Orders and satisfy such obligations in the ordinary course of business; and
(b) pay prepetition claims of the Claimants in the ordinary course of business in an aggregate
amount not to exceed $35.3 million during the Interim Period and pursuant to the Final Order, in
an aggregate amount not to exceed $39.5 million.
A. Outstanding Orders.
188. I understand that the Debtorssuppliers may be concerned that they will be
rendered general unsecured creditors, rather than administrative claimants, with respect to goods
and services ordered before the Petition Date for delivery or provision after the Petition Date. As
a result, I understand that suppliers may refuse to ship or transport such goods (or recall such
shipments) or provide services with respect to Outstanding Orders unless the Debtors issue

41
The Debtors have agreed to maintain a matrix summarizing (a) the name of each Critical Vendor that receives a
payment (or payments) pursuant to the Interim Order or the Final Order; (b) the total amount paid to each
Critical Vendor pursuant to the Interim Order or the Final Order; and (c) the nature of the goods and/or services
provided by each Critical Vendor to whom a payment under the Interim Order or the Final Order is made (the
Critical Vendor Summary). The Debtors will provide the Critical Vendor Summary, along with any executed
Vendor Agreement, upon reasonable written request to the U.S. Trustee, the Ad Hoc Committee of TCEH First
Lien Creditors, certain holders of unsecured claims against EFIH (the Ad Hoc Committee of EFIH Unsecured
Creditors, the agent for the TCEH and EFIH debtor in possession financing facilities, and, once appointed
counsel to any official committee of unsecured creditors (the Creditors Committee). I understand that the
Debtors request that this agreement to disclose payments be conditioned on the execution of a confidentiality
agreement by any recipient of a Critical Vendor Summary and/or Vendor Agreements. The Debtors also
request that the Debtors not be required to disclose any information that the Debtors deem to be proprietary or
competitive in nature to any competitor or any individual member of any committee.
42
Debtors to (A) Grant Administrative Expense Priority to All Undisputed Obligations for Goods and Services
Ordered Prepetition and Delivered Postpetition and Satisfy Such Obligations in the Ordinary Course of
Business, and (B) Pay Prepetition Claims of Shippers, Warehousemen, and Materialmen, filed

71

substitute purchase orders postpetition or obtain an order of the Court permitting the Debtors to
meet their obligations under the Outstanding Orders even though the Outstanding Orders are
entitled to administrative expense priority under section 503(b) of the Bankruptcy Code. Thus, I
understand that the Debtors seek to affirm that the Outstanding Orders are entitled to
administrative priority and to pay such Outstanding Orders in the ordinary course of business to
avoid any unnecessary disruption to business operations and administrative costs associated with
reissuing purchase orders or seeking additional relief.
B. Claims of Shippers, Warehousemen, and Materialmen.
1. Shippers.
189. I understand that the Debtors ability to produce and deliver energy in a timely
manner depends on their timely receipt of raw materials, parts, equipment, supplies, fuel, and
components that are important to the Debtors business operations. To that end, I understand
that the Debtors rely upon certain professional domestic and international common carriers,
shippers, truckers, logistics management companies, pipelines, rail carriers, and certain other
third-party service providers to ship, transport, and deliver goods (the Shippers). I understand
from Debtors counsel that under certain state and federal laws, the Shippers could potentially
assert possessory liens over goods currently in their possession for amounts the Debtors owe to
the Shippers. See 49 U.S.C. 80109 (providing for uniform shipper liens with respect to
interstate shipments using common carriers); Tx. Bus. & Com. 7.307 (providing that carriers
have a lien on shipped goods). I understand that the value of the goods being shipped do not
necessarily exceed the amounts owed to the Shippers, but an inability to acquire these materials
or parts from the Shippers could result in serious disruption to the Debtors operations. I also
understand that timely delivery of these items is therefore vital to the operation of the Debtors
businesses.

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190. I understand that, as of the Petition Date, the Debtors owe approximately $19.4
million on account of shipping and logistics charges for goods ordered prepetition, all of which
will become due and owing during the Interim Period.
2. Warehousemen.
191. I understand that to store certain of the same materials and parts transported by
the Shippers, the Debtors use offsite storage space with certain warehouse facilities (collectively,
the Warehousemen). For example, the Debtors have entered into several contracts to store
natural gas utilized to fuel certain power generation assets and in other activities. From Debtors
counsel, I understand that under certain state laws, the Warehousemen may be able to assert
possessory liens against the warehoused property for amounts owed to the Warehousemen. See
Tx. Bus. & Com. 7.209 (providing for warehousemen liens even where a storage agreement,
rather than a warehouse receipt, governs the transaction). I understand that the availability of
these warehoused goods and materials are similarly important to the continued operation of the
Debtors businesses, and the amount due to the Warehousemen is significantly less than the
value of the goods being stored.
192. I understand that, as of the Petition Date, the Debtors owe approximately
$3.2 million on account of Warehousemen claims, all of which will become due and owing
during the Interim Period.
3. Materialmen.
193. I understand that the Debtors energy production and mining activities depend
upon third-party contractors, mechanics, machinists, and repairmen that repair, fabricate, or
perform other services on certain parts, equipment, and other materials used in the Debtors
facilities (the Materialmen).

73

194. I understand from Debtors counsel that under certain state laws, including the
Texas Constitution, the Materialmen could potentially assert possessory liens against the Debtors
and their property for amounts that the Debtors owe and may refuse to return the Debtors
property until they are paid for their services. See Tex. Cont. Art. XVI 37 (self-effectuating
constitutional lien in favor of [m]echanics, artisans and material men, of every class . . . upon
the buildings and articles made or repaired by them); Tx. Prop. 70.001 (providing for certain
possessory materialmen liens). I understand that the value of the property is greater than the
amount of the Materialmens claim for services rendered.
195. I understand that, as of the Petition Date, the Debtors owe approximately
$16.9 million on account of outstanding prepetition invoices of the Materialmen, of which
approximately $12.7 million will become due and owing during the Interim Period.
C. Proposed Treatment of Claimants.
196. Under the state and federal laws described above, I understand from Debtors
counsel that the Claimants may have perfected liens against certain of the Debtors goods,
equipment, and facilities, or may be able to perfect such liens postpetition. I understand that even
in the absence of such liens, the Claimants may possess goods that are vital to the Debtors
ongoing business operations.
Customer Programs Motion.
43
VIII.
350. In the Customer Programs Motion, the Debtors seek entry of: (a) the Claims
Order authorizing, but not directing, the Debtors to (i) maintain and administer all of the

43
See Motion of Energy Future Holdings Corp., et al., for Entry of (A) an Order Authorizing the Debtors to (I)
Maintain and Administer Customer Programs and Customer Agreements, (II) Honor Prepetition Obligations
Related Thereto, (III) Pay Certain Expenses on Behalf of Certain Organizations, (IV) Fix Deadlines to File
Proofs of Claim for Certain Customer Claims, and (V) Establish Procedures for Notifying Customers of
Commencement of the Debtors Chapter 11 Cases, Assumption of Customer Agreements, and the Bar Dates for
Customer Claims and (II) an Order Authorizing the Debtors to Assume the Customer Agreements, filed

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Customer Programs (each defined in the Customer Programs Motion) in the ordinary course of
business, (ii) honor prepetition commitments owing on account of all of the Customer Programs,
(iii) pay certain expenses on behalf of the PUC and ERCOT (each defined in the Customer
Programs Motion) incurred during the chapter 11 cases, (iv) fix the Customer Claims Bar Date
for filing Proofs of Claims for Customer Claims (each defined in the Customer Programs
Motion), and (v) establish the Customer Noticing Procedures to provide notice to current and
former customers of commencement of the chapter 11 cases, assumption of Customer
Agreements with current customers, and the Customer Claims Bar Date; and (b) after a final
hearing, the Assumption Order authorizing the Debtor entities TXU Energy Retail Company
LLC (TXU Energy Retail), 4Change Energy Company (4Change), Luminant ET Services
Company (Luminant ET Services), and Luminant Energy Company LLC (Luminant Energy
and, together with TXU Energy Retail, 4Change, and Luminant ET Services, the Retail
Debtors) to assume the Customer Agreements with their customers.
44

351. I understand that the Debtors estimate that as of the Petition Date, the total
amount of obligations to customers on account of the Customer Programs ranges from
approximately $120 million to $135 million, including approximately $80 million to $90 million
for Customer Credits, Customer Deposits, and the Average Monthly Billing Program.
45
I also
understand that the Debtors estimate that they are obligated to pay approximately $12 million on

44
The Customer Programs Motion does not request any relief with respect to or affect the rights, duties, or
obligations of EFIH and EFIH Finance, Inc., or EFH Corp., other than with respect to EFH Corp.s obligations
under the Charitable Contributions Program (each defined in the Customer Programs Motion).
45
I understand that the Debtors obligations to customers under the following Customer Programs are generally
not cash payment obligations: the Average Monthly Billing Program, Customer Credits (excepting amounts
refunded to customers, as described in the Customer Programs Motion), Customer Deposits, and Customer
Agreements, all as defined and discussed in the Customer Programs Motion. I also understand that obligations
to customers under these Customer Programs fluctuate due to seasonality, business cycles, and various other
business and economic factors.

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account of prepetition Customer Programs obligations within the first 30 days of the Petition
Date.
A. Overview of the Debtors Business Operations and Customer Base.
352. I understand that the Debtors operate in all areas of the region overseen by
ERCOT, which manages the supply of approximately 85% of the electricity consumption in
Texas. The majority of ERCOT is open to retail electric competitionapproximately 6.7
million customers have the ability to choose their retail electric provider.
46

353. I understand that the Retail Debtors compose the Debtors retail operations,
through which the Debtors engage in retail sales of electricity to approximately 1.7 million
residential and business customers in Texas, as well as the sale and delivery of natural gas to
several hundred commercial and industrial customers. In the first quarter of 2014, I understand
that approximately 68% of the Debtors retail operations revenue resulted from sales of
electricity to residential customers. I also understand that the Debtors compete against more than
100 other certified retail electric providers to supply customers with electricity in all areas of the
ERCOT region open to competition, including the Dallas/Fort Worth, Houston, Corpus Christi,
and lower Rio Grande Valley areas of Texas.
B. The Customer Agreements.
197. I understand that the Retail Debtors agreements with their customers
(collectively, the Customer Agreements) generally fall into three categories. I also understand
that the first category of Customer Agreements constitutes the vast majority of the Customer
Agreements and consists of various retail electric power sales agreements that one of TXU
Energy Retail, 4Change, or Luminant ET Services has entered into with residential and small

46
References to the number of customers in the Customer Programs Motion refer to the number of electricity
meters.

76

business customers as well as large commercial and industrial end-use customers within the
ERCOT region (collectively, the Retail Agreements).
47
Although they vary in size, I
understand that the Retail Agreements typically include terms relating to the calculation and
payment of charges, addition and removal of customer premises, adjustments to the contract
price, events giving rise to the right to terminate, remedies upon termination, force majeure,
notices, warranties and limitations of liabilities, and indemnifications.
48
customers that are party to the Retail Agreements include residential customers as well as more
than 2,200 large organizations that represent a wide range of sectors, including manufacturing,
energy, real estate, retail, and healthcare, as well as municipalities, schools, and religious
organizations. As of March 31, 2014, I understand that TXU Energy Retail, 4Change, and
Luminant ET Services served approximately 1.7 million retail customers under the Retail
Agreements.
198. I understand that the second category of Customer Agreements is composed of
approximately 350 commercial retail natural gas agreements that Luminant Energy has entered
into with industrial and commercial customers to supply natural gas across North Texas and the
greater Houston area (the Retail Gas Agreements). I also understand that the Retail Gas
Agreements provide a consistent earnings and cash flow stream to the Debtors.

47
I understand that for the avoidance of doubt, the Retail Agreements do not include wholesale contracts to which
any Debtor is a party with an affiliate of an end-use customer.
48
I understand that additionally, certain of the Customer Agreements impose an obligation on the Debtors to
purchase power generated by their customers, which the Debtors subsequently sell into the ERCOT region (the
Power Purchase Obligations). As of the Petition Date, the Debtors estimate that Luminant ET Services owes
approximately $315,000 on account of such Power Purchase Obligations.

77

199. I understand that the Customer Agreements also include agreements between
Luminant Energy and one of the following customers: (a) The City of Goldsmith, Texas;
49

(b) Ameripower, LLC; (c) Infinite Electric, LLC and Veteran Electric, LLC; (d) Clearview
Electric, Inc.; and (e) WM Renewable Energy, LLC
50
(collectively, the Luminant Customer
Agreements). Pursuant to the Luminant Customer Agreements, Luminant Energy sells
electricity and provides related services to, and/or schedules the delivery of power for, each
customer. Additional detail regarding the Luminant Customer Agreements, along with the
respective Cure Amount, if any, are listed on Exhibit 1 annexed to Exhibit B attached to the
Customer Programs Motion.
51

200. I believe the Customer Agreements are essential to the Debtors operations. In
particular, I understand that the Customer Agreements account for approximately 38 terawatt
hours of delivered power on an annual basis, and over 74% of the Debtors overall revenues. I
understand that to provide assurances to current and prospective customers that the Retail
Debtors will continue to perform under the Customer Agreements and provide the same level of
competitive and innovative service on par with their prepetition performance.

49
I understand that as discussed in Exhibit 1 to Exhibit B attached to the Customer Programs Motion, Luminant
Energy provides payment and invoice processing services to The City of Goldsmith. Specifically, Luminant
Energy pays The City of Goldsmiths transmission, distribution, and other charges to the applicable utility
service provider, and then seeks reimbursement from the City of Goldsmith (the Invoice Processing Services).
As of the Petition Date, the Debtors estimate that they owe approximately $3,000 of pass-through amounts on
account of Invoice Processing Services.
50
I understand that as discussed in Exhibit 1 to Exhibit B attached to the Customer Programs Motion, Luminant
Energy purchases power produced by a landfill owned by WM Renewable Energy, LLC, which is subsequently
sold to a retail customer of TXU Energy Retail. As of the Petition Date, I understand that the Debtors estimate
that Luminant Energy owes approximately $160,000 to WM Renewable Energy, LLC on account of such
Power Purchase Obligations.
51
I understand that because the Debtors are seeking to honor prepetition obligations to customers pursuant to the
Claims Order, the Debtors estimate that the Cure Amount with respect to each of the Customer Agreements will
be $0.

78

C. The Debtors Customer Programs.
354. The wholesale and retail electricity markets in the ERCOT region are highly
competitive. I understand that approximately 73% of the markets electricity demand in the
ERCOT region is attributable to customers located in areas where there is a choice among retail
electric providers. I also understand that because Texas is one of the fastest growing states in the
U.S. with a comparatively robust economy, competition within the ERCOT region for these
customers is particularly fierce. As of December 2013, I understand that there were more than
100 certified competitive retail electric providers (compared to approximately 40 in 2002, the
first year of retail electric competition in Texas). Based on data published by the PUC, as of
September 30, 2013, I understand that approximately 62% of residential customers and 69% of
small commercial customers in competitive areas of the ERCOT region are served by retail
electric providers not affiliated with the pre-competition electric company in operation before the
deregulation of the ERCOT region retail electricity market in 2002. Moreover, approximately
89% of residential customers and 90% of small commercial load customers have chosen an
electricity provider at least once since the ERCOT retail market deregulation process began in
Texas in 2002,
52
making Texas the only state with retail competition where more than half of
residential customers have chosen to be served by electricity providers other than the incumbent,
traditional electric utilities.
53

355. In addition, I understand that the Debtors are a significant supplier of natural gas
to small business and industrial and commercial customers in North Texas and the greater
Houston area. I understand that the Debtors provide a variety of natural gas services, including

52
Electric Reliability Council of Texas, Inc., Supplemental Information Retail Electric Market (March 21, 2014).
53
Public Utility Commission of Texas et al., Texas Energy Assurance Plan 45 (Nov. 2012). See the First Day
Declaration for more information about deregulation in the ERCOT region.

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firm supply, scheduling, nominations, and balancing for those commercial and industrial
customers. The Debtors natural gas customers participate in various industries, including
manufacturing, steel, glass, heat treating, chemical, refining, food service, hospitals, and
commercial buildings.
356. In this highly competitive space, I understand that the Debtors retail operations
employ a number of programs to develop and maintain customer loyalty and attract new
customers, including various cash-back, billing arrangements, and other rewards, rebates and
incentive programs, and incur certain other obligations and commitments to customers, including
credits, deposits, charitable contributions, and warranties (collectively, as discussed in the
Customer Programs Motion, the Customer Programs).
357. I believe that continuing the Customer Programs in the ordinary course is
essential to the Debtors seamless transition into chapter 11 and will facilitate a successful
reorganization. As discussed in the First Day Declaration, the Debtors filed these cases primarily
to effectuate a balance sheet restructuring. Thus, to preserve the value of their businesses, they
must promptly assure their customers that the Customer Programs will continue uninterrupted. I
believe that the continuation of the Customer Programs is critical for maintaining customer
confidence and trust in the Debtors businesses and to ensure that the Debtors preserve market
share in a highly competitive industry. The following describes Customer Programs that the
Debtors actively use to cultivate customer support and loyalty.
1. Rewards Programs.
358. I understand that the Debtors retail operations offer various rewards programs,
including a cash-back loyalty rewards program (the Cash-Back Rewards), a welcome bonus
program (the Bonus Program), the LUV 2Fly Rapid Rewards Program with Southwest
Airlines (the Rapid Rewards Program), referral programs (the Refer-a-Friend Programs),

80

third-party partner incentives (the Partner Incentives), sweepstakes programs (the
Sweepstakes Programs), and other reward and incentive programs (collectively, the Rewards
Programs).
359. I understand that the Cash-Back Rewards are a customer loyalty program that
makes recurring annual cash payments to participating customers. I also understand that the
Debtors accrue obligations over the course of the year on account of the Cash-Back Rewards
and, in the first quarter of each year, make payments to customers in an amount equal to
approximately 2% to 6% of the total energy and transmission and distribution utility charges
incurred by customers during the preceding calendar year. I understand that the payments
primarily come in the form of Visa debit cards issued in the name of customers, and constitute
actual cash obligations. I also understand that customers with $5.00 or less in Cash-Back
Rewards receive a credit on their bill rather than a debit card. I understand that if customers do
not use the full amount of the Cash-Back Rewards on their cards within six months from the date
the cards are received, the unused portion is returned to the Debtors. I understand that hundreds
of thousands of residential and business customers participate in the Cash-Back Rewards.
360. I understand that the Debtors also attract new customers and retain current
customers through incentive programs, including the Bonus Program, the Refer-a-Friend
Programs, and the Rapid Rewards Programs. Under the Bonus Program, I understand that new
customers and current customers who initiate, transfer, or renew their service receive a prepaid
Visa debit card worth various amounts upon redemption. I understand that under the Refer-a-
Friend Programs, current customers who successfully refer a new person who becomes a
customer receive up to $50 in the form of billing credits or a prepaid Visa debit card, as does the
new customer. I also understand that there is no limit on the amount of rewards a referring

81

customer can earn under the Refer-a-Friend Programs. I understand that the rewards under the
Bonus Program and the Refer-a-Friend Programs constitute actual cash obligations. I understand
that if customers do not use the full bonus amount on their cards by the expiration date printed on
the cards, the unused portion is returned to the Debtors. I understand that there are two Rapid
Rewards Programs, each of which lasts for either 12, 24, or 30 months. I also understand that
customers who signed up for one of the Rapid Rewards Programs earn and receive Southwest
Airlines rewards points over the duration of the program. I understand that the Debtors purchase
these rewards points from Southwest Airlines, which customers can redeem for Southwest
Airlines flights.
361. I understand that customers occasionally receive Partner Incentives, including
coupons, discounts, and other incentives, from the Debtors and certain third-party partners. I
also understand that the Partner Incentives are typically included as inserts with customers
monthly bills or are offered to customers through direct sales efforts. Additionally, I understand
that the Debtors and certain of their third-party partners offer Partner Incentives to customers
who enroll in one of the home warranty programs offered to customers by the Debtors and their
third-party partners. I understand that the Debtors reimburse third-party partners for their
allocated cost of associated Partner Incentives. I understand that the Sweepstakes Programs are
marketing and promotional tools used to attract new customers and retain current customers.
Under the Sweepstakes Programs, I understand that the Debtors offer customers the opportunity
to win travel and event tickets, gift cards, and certain other prizes.
362. I understand that the Debtors pay approximately $40 million to $45 million each
year on account of the Rewards Programs. As of the Petition Date, I understand that the Debtors

82

estimate that the total amount due under the Rewards Programs will be approximately $15.9
million.
2. Average Monthly Billing Program.
363. As required by applicable PUC regulations, I understand that the Debtors retail
operations offer residential customers the option to pay their bills based on their average usage
on a rolling basis, rather than a bill based on their actual usage in the preceding month (the
Average Monthly Billing Program). I understand that the Average Monthly Billing Program is
an attractive option for certain customers because it reduces the fluctuation in their energy bill
due to seasonal requirements. I also understand that at any point in the year, the Average
Monthly Billing Program results in either a net overpayment or underpayment by participating
customers, depending on whether the running total of payments by such customers is greater or
less than their actual electricity usage. If customers decide to discontinue the Average Monthly
Billing Program, a credit or debit is applied to their next bill. To the extent that customers
payments under the Average Monthly Billing Program exceed the actual amounts used during
those months, I understand that the Debtors are in possession of customer dollars, which
constitute obligations to customers.
364. I understand that a significant number of customers participate in the Average
Monthly Billing Program, and the amount owed to customers varies widely during the year,
ranging from approximately $2 million to approximately $20 million. As of the Petition Date, I
understand that the Debtors estimate that they owe an aggregate amount of approximately $17
million worth of prepaid services on account of the Average Monthly Billing Program.
3. Customer Deposits and Customer Credits.
365. I understand that based on customers utility payment data and history, the
Debtors retail operations request that certain customers pay a deposit (the Customer

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Deposits). I understand that the Debtors hold Customer Deposits as part of their operating cash.
I understand that the PUC, however, requires the Debtors to post letters of credit payable to the
PUC in the amount of Customer Deposits held by the Debtors to maintain their status as a
certified retail electric provider. In addition, I understand that the Debtors post letters of credit
payable to the PUC in the amount of prepayments held by the Debtors under certain of their
electricity plans. I understand that the Debtors return Customer Deposits to customers after they
have paid their electricity bills in full with no late payments for 12 consecutive months, together
with any interest that has accrued during the period. I also understand that the Debtors typically
return Customer Deposits in the form of a credit to the customers electricity bills.
366. In addition to returned Customer Deposits that are credited to customers
electricity bills, I understand that the Debtors also treat overpayments, corrections, and
prepayments (other than through the Average Monthly Billing Program) as credits to the
customers accounts (the Customer Credits). As discussed above, I understand that customers
who discontinue the Average Monthly Billing Program may receive Customer Credits to the
extent their cumulative payments exceed the value of services received. I understand that under
certain electricity plans offered by the Debtors, customers are allowed to prefund their account
balances. I understand that these prepayments constitute Customer Credits, against which
subsequent electricity and other charges are debited. I also understand that based on historical
data from the last twelve months, the Debtors estimate that the amount of outstanding Customer
Credits fluctuates between $10 million to $20 million throughout the year.
367. If a customer discontinues service with the Debtors or is an inactive customer and
has outstanding Customer Deposits or Customer Credits, I understand that the Debtors will issue
a refund check to the customer or otherwise credit a customers credit card. I also understand

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that the Debtors refund approximately $14 million to customers on an annual basis on account of
the Customer Deposits and Customer Credits.
368. As of the Petition Date, I understand that the Debtors estimate that they hold an
aggregate amount of approximately $65 million to $75 million on account of the Customer
Deposits and Customer Credits.
4. Brighten Programs.
369. I understand the Debtors retail operations offer an energy savings program to
certain business customers known as Brighten GreenBack (the Brighten GreenBack Program).
I also understand that the Brighten GreenBack Program provides businesses with an incentive to
purchase or install infrastructure or qualifying electric vehicles. I understand that after installing
qualifying energy efficient equipment, customers can submit their expenses to the Debtors and
the Debtors then reimburse these customers in the form of rebate checks up to a specified
amount.
370. I understand that the Debtors retail operations also provide customers with
discounts and incentives to purchase energy-saving items through its Brighten Online Energy
Store (the Brighten Online Store and, together with the Brighten GreenBack Program, the
Brighten Programs). I understand that a third party manages the Brighten Online Store and
handles all product logistics costs in exchange for a percentage of revenues generated through
the store with the Debtors. I understand that the Debtors reimburse this third party for the
difference between the retail price and the discounted price of products purchased by the
Debtors customers through the Brighten Online Store.
371. As of the Petition Date, I understand that the Debtors estimate that they owe an
aggregate amount of approximately $1 million on account of the Brighten Programs, net of the
Debtors share of revenues associated with the Brighten Online Store.

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5. Customer Partners.
372. I understand that the Debtors use a variety of third-party contractual arrangements
to cultivate, maximize, and develop their customer relationships. I also understand that the
Debtors enter into third-party agreements and professional service agreements (the Channel
Partner Agreements) with third parties that act as brokers and consultants for the Debtors (each,
a Channel Partner). I understand that the Channel Partner Agreements include collection and
remittance agreements, under which the Debtors bill and collect payments from customers, and
then remit payments to the Channel Partner. I understand that if a customer disputes a fee
obtained through a Channel Partner Agreement and does not pay, the Debtors do not continue to
pay the Channel Partner, and the Channel Partner is responsible for collection from the customer.
I understand that the Channel Partner Agreements also include professional service agreements,
under which the Channel Partners agree to promote and market the Debtors as retail electric
providers to prospective customers, and the Debtors agree to pay Channel Partners certain fees
associated with contracts signed by customers.
373. I understand that the Debtors also utilize third-party partners to conduct door to
door sales of the Debtors retail goods and services (the Sales Partners). I understand that the
Sales Partners are typically paid commissions for enrolling new customers in the Debtors
electricity plans. I understand that the rate of commission varies with the type and duration of
the plan in which a customer successfully enrolls. Additionally, I understand that the Sales
Partners are paid on commission for the sale of related goods, including iThermostats (defined in
the Customer Programs Motion).
374. I understand that the Debtors also contract with various call centers to provide
real-time customer service to the Debtors retail customers (the Call Center Partners and,
together with the Channel Partners and the Sales Partners, the Customer Partners). I

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understand that the hourly rates at which the Debtors pay the Call Center Partners vary
depending upon the specific type of work performed, including handling customer calls, training
personnel, case management, and back-office services.
375. I understand that the Customer Partners are key intermediaries between the
Debtors retail operations and potential customers, as they inform customers about the Debtors
products and services, assist with the enrollment of new customers, and service the Debtors
existing customers. As such, I understand that the Customer Partners are important sources of
new business and critical to the retention of existing business for the Debtors. I understand that
if the Debtors do not continue to perform under existing Customer Partner agreements and remit
fees, the Customer Partners may be reluctant to promote the Debtors retail operations, generate
new customer leads, and provide the exemplary services to the customers that the Debtors are
known for. I believe failure to honor amounts owed to Customer Partners could damage the
Debtors reputation with existing and potential customers, to the detriment of the Debtors
operations.
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376. I understand that the total obligation to Customer Partners is approximately $51
million annually. As of the Petition Date, I understand that the Debtors estimate that they owe
an aggregate amount of approximately $8.6 million to Customer Partners.
6. Renewable Energy Obligations.
377. I understand that certain regulations require the Debtors to obtain a specified
amount of their supply of power from renewable energy sources or otherwise to purchase

54
I understand that pursuant to the Customer Programs Motion, the Debtors do not seek any relief with respect to
employees of the Debtors that perform services similar to those performed by third-party Customer Partners.
For additional information on the Debtors employees, see the Motion of Energy Future Holdings Corp., et al.,
for Entry of Interim and Final Orders (A) Authorizing the Debtors to (I) Pay Certain Prepetition Compensation
and Reimbursable Employee Expenses, (II) Pay and Honor Employee and Retiree Medical and Similar Benefits,
and (III) Continue Employee and Retiree Benefit Programs, and (B) Modifying the Automatic Stay (the Wages
Motion), filed contemporaneously with the Customer Programs Motion.

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renewable energy credits in the energy market from renewable energy credit retailers or
brokers. Additionally, the Debtors retail operations provide certain customers with an agreed-
upon amount of power from renewable energy sources (together with the regulatory obligations,
the Renewable Energy Obligations). The Debtors performance of the Renewable Energy
Obligations enables the Debtors and their customers to comply with statutory or regulatory
requirements, maintain certain environmental sustainability certifications, and make public
claims with respect to the use of power from renewable energy sources. ERCOT recognizes the
transfer of renewable energy credits from one account holder to another. As a retail electric
provider, I understand that the Debtors must retire purchased renewable energy credits to
demonstrate fulfillment of Renewable Energy Commitments. I understand that renewable
energy credits are retired by using the credits to comply with a statutory or regulatory
requirement or to make a public claim associated with the purchase of the credits, at which point
the retired renewable energy credits are no longer transferrable. I understand that total
Renewable Energy Obligations to customers is approximately $12 million annually.
378. I understand that as of the Petition Date, the Debtors estimate that they owe an
aggregate amount of approximately $11 million on account of the Renewable Energy
Obligations.
7. Charitable Contributions Programs.
379. I understand that the Debtors maintain several charitable contribution programs
(the Charitable Contributions Programs), including, but not limited to, the Energy Aid
Program, the Support and Save Program, the 4Change Pledge, and the 501(c)(3) Donations (each
as defined in the Customer Programs Motion). I understand that the Charitable Contributions
Programs enhance the Debtors standing in the industry and within the community and build
goodwill that enhances the value of their business.

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380. I understand that the Debtors maintain a matching program for customer
contributions to local communities (the Energy Aid Program). I understand that the Energy
Aid Program is the largest bill-payment assistance program among regulated and competitive
electricity providers in the nation. Under the Energy Aid Program, for every $1.00 that
customers donate to the Energy Aid Program, the Debtors contribute $5.00 to local communities
to help individuals pay their electricity bills. As described further in the Wages Motion, I
understand that the Debtors employees also contribute to the Energy Aid Program through
paycheck deductions, and the Debtors match their employees contributions.
55

381. I understand that the Debtors retail operations also maintain a charitable
contributions program to support nonprofit organizations (the Support and Save Program),
under which persons can support a public or private school or other participating nonprofit
organization by enrolling as a new customer through the program. I understand that the
designated organization receives $50 for each such enrollment, and amounts are accumulated
and awarded on a quarterly basis and are paid by check. I also understand that there are no
annual limits on the amount a participating organization can receive through the program.
Rewards under the Support and Save Program constitute actual cash obligations.
382. I understand that Debtor 4Change Energy Company pledged to give 4% of its
profits to one of several non-profit organizations, including Texas Food Bank, the American
Cancer Society, the American Red Cross, and Heroes for Children (the 4Change Pledge).
Additionally, I understand that the Debtors plan to donate approximately $2 million during 2014
to various 501(c)(3) nonprofit organizations (the 501(c)(3) Donations).

55
For additional information on the Energy Aid Program, relief sought with respect to employee donations, and
related matching, see the Wages Motion, filed contemporaneously herewith.

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383. I understand that the Debtors plan to contribute over $5 million in 2014 on
account of Charitable Contributions Programs. As of the Petition Date, I understand that the
Debtors estimate that their outstanding obligations under the Charitable Contributions Programs
total approximately $1.2 million.
8. Customer Warranties.
384. I understand that the Debtors and certain third-party service providers offer
various products, services, and warranty programs to the Debtors customers (the Customer
Warranties). For example, the Debtors pay a third-party vendor to provide iThermostat
installation services.
56
In addition to the iThermostats installations, I understand that this third-
party vendor also provides a variety of services to the Debtors and their customers, including
server hardware and database administration, license and software maintenance, warehousing,
and other customer maintenance services such as repairing and replacing gateways and
iThermostats (the Support Services).
385. As discussed above, I understand that the Debtors retail operations and certain of
their third-party partners also offer home warranty programs to customers (the
Home Warranties). For example, the Debtors partner with a third-party to provide Home
Warranties, including for repair services and replacement coverage for air conditioning units,
heating units, electronics, and other appliances. I also understand that the Debtors collect
payments from customers that participate in the Home Warranties and remit a portion of the
proceeds to the third party, which provides the warranty goods and services.
386. I believe the continued performance of customer-facing services under the
Customer Warranties is important to satisfying and retaining existing customers, as well as

56
iThermostats are energy-saving programmable thermostats that allow customers to monitor and manage
temperatures via the internet (the iThermostats).

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attracting new customers. I understand that the third-party partners are important intermediaries
between the Debtors and their customers, and it is essential that performance of services under
the Customer Warranties continue in the ordinary course of business. I believe that third-party
partners may be reluctant to continue performing under the Customer Warranties absent specific
authorization from the Court. I understand that to provide assurances to the Debtors customers
that the Customer Warranties will be honored, the Debtors seek authority to continue to honor
and satisfy any and all obligations related to prepetition and any new postpetition Customer
Warranties, including those obligations to third-parties that perform under the Customer
Warranties for the benefit of customers.
387. As of the Petition Date, I understand that the Debtors owe an aggregate amount of
approximately $1 million on account of the Customer Warranties.
9. Reduction Rewards.
388. I understand that the Debtors retail operations offer a critical peak rebate
program (the Reduction Rewards Program) to commercial and industrial customers with
minimum annual electricity usage of approximately 1 megawatt. I understand that the Reduction
Rewards Program helps the Debtors and their customers to address peak electricity demand
issues within the ERCOT region, including demand and price volatility, by allowing customers
to manage their electricity usage in response to peak events. I also understand that the Debtors
alert participating customers to the occurrence of a peak event, and pay each customer for every
kilowatt hour of electricity load reduction below the customers corresponding baseline demand
level. I understand that the rate per kilowatt hour of electricity reduction during the peak event
that is paid to customers varies depending on market conditions.
389. As of the Petition Date, I understand that the Debtors estimate that they do not
owe any amounts on account of the Reduction Rewards Program.

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D. Customer Incidents.
201. I understand that the Customer Agreements and the Customer Programs
occasionally give rise to customer complaints and claims (the Customer Incidents). To ensure
continuing excellent service and customer satisfaction, I understand that the Debtors employ
certain measures to address any service-related issues and to resolve and settle the Customer
Incidents in the ordinary course of business. I also understand that as of the Petition Date, the
Debtors estimate that they owe an aggregate amount of approximately $2.1 million on account of
the Customer Incidents.
E. Payment of Certain Expenses on Behalf of Certain Organizations.
390. I understand that the Debtors are subject to regulation or oversight by various
entities, including the PUC and ERCOT.
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I understand that the PUC and ERCOT have wide-
ranging oversight over the ERCOT and Texas electricity markets, including with respect to the
sale, purchase, transmission, and distribution of electricity to consumers. I understand that
because the Debtors are the preeminent merchant power generator and retail electricity provider
within the ERCOT region, the Debtors anticipate that the PUC and ERCOT will play an active
role in the Debtors chapter 11 cases to ensure that the public interest is adequately represented
and protected.
391. I understand to facilitate the participation of the PUC and ERCOT in the Debtors
chapter 11 cases, the Debtors seek to pay certain expenses incurred by the PUC and ERCOT,
including all reasonable CourtCall and remote conferencing costs and the cost of providing
notice and/or service of filings by the PUC and ERCOT in these chapter 11 cases to relevant

57
ERCOT, the Electric Reliability Council of Texas, is a regional reliability coordinating organization responsible
for ensuring the reliability of the electricity market in Texas. Additionally, I understand that ERCOT is the
independent system operator of the interconnected transmission grid for member electricity systems within
Texas.

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parties. Additionally, I understand that the Debtors request authority to allow the PUC and
ERCOT to utilize the noticing services of Epiq Bankruptcy Solutions, LLC (Epiq), the
Debtors claims and noticing agent, at the Debtors expense.
58
I understand that the Debtors
submit that the cost to their estates of paying these expenses on behalf of the PUC and ERCOT is
greatly outweighed by the benefits to their estates of ensuring that the public interest is
well-represented during these chapter 11 cases.
F. Assumption of the PPAs and Retail Agreements.
392. Pursuant to the Assumption Order, I understand that the Retail Debtors seek to
assume the Customer Agreements pursuant to section 365(a) of the Bankruptcy Code to provide
their customers and other parties in interest with additional assurance of the Retail Debtors
intent to honor their obligations to customers and to continue providing electricity and natural
gas, and performing under the Customer Agreements. I believe that assumption of the Customer
Agreements at the outset of these chapter 11 cases will reduce the likelihood of confusion or
uncertainty on the part of customers with respect to the continuing provision of electricity,
natural gas, and related services by the Debtors, to the benefit of the Debtors estates.
393. I understand that the Retail Debtors obligations under the Customer Agreements
are primarily performance-based, and the Debtors do not believe that any defaults exist under the
Customer Agreements that must be cured under section 365(b)(1)(A) (after giving effect to
section 365(b)(2)). Accordingly, I understand that the Debtors have determined that the amount
necessary to cure unpaid monetary obligations arising under the Customer Agreements is $0 (the
Cure Amount). Furthermore, I understand that to the extent any such defaults exist, the

58
The Debtors seek to retain Epiq as the Debtors claims and noticing agent pursuant to the Application of Energy
Future Holdings Corp., et al., for Entry of an Order Approving the Retention and Appointment of Epiq
Bankruptcy Solutions, LLC as the Claims and Noticing Agent for the Debtors, filed contemporaneously
herewith.

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Debtors long history of providing electricity and natural gas to customers and honoring their
contractual obligations with customers provides customers with adequate assurance of the Retail
Debtors ability to continue performing under the Customer Agreements.
Hedging and Trading Motion.
59
IX.
202. As is customary in the Debtors industry, I understand that certain of the Debtor
entities, including Luminant Energy Company LLC, Luminant ET Services Company, and
Luminant Generation Company LLC (collectively, the Hedging and Trading Entities),
60
enter
into hedging and trading contracts with various counterparties primarily to hedge their exposure
to commodity risks, including price and delivery risk (collectively, and as described below, the
Hedging and Trading Arrangements and the activities related thereto, the Hedging and
Trading Activities) within established risk management guidelines (as discussed below, the
Risk Management Guidelines).
61

59
Debtors to (A) Continue Performance Under the Hedging and Trading Arrangements, (B) Pledge Collateral
and Honor Obligations Thereunder, and (C) Enter into and Perform Under New Postpetition Hedging and
Trading Arrangements, filed contemporaneously herewith.
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As a general matter, I understand that only the TCEH Debtors (as defined in the Hedging and Trading Motion)
have operations like those described in the Hedging and Trading Motion. The Debtors are, therefore, not
seeking relief or imposing any obligations in the Interim Order or Final Order as to any Debtors other than the
TCEH Debtors. For the avoidance of doubt, the Hedging and Trading Motion does not request any relief with
respect to, or affect the rights, duties, or obligations of, EFIH and EFIH Finance, Inc.
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As described in detail in the First Day Declaration, I understand that over 95% of the TCEH Debtors positions
in the natural gas price hedging program and all of the first lien interest rate swaps of TCEH (collectively, the
First Lien Hedges and Swaps) are secured by a first lien on substantially all of the TCEH Debtors assets that
is pari passu with the outstanding obligations under the TCEH Debtors first-lien credit agreement and first-lien
notes. I understand that the total net first lien exposure on account of the First Lien Hedges and Swaps is
approximately $1.255 billion as of April 11, 2014.
In addition, I understand that Energy Future Holdings Corp. transacted a number of unsecured interest rate swap
agreements with various banks (collectively the Legacy Swaps). I understand that as of April 11, 2014, the
exposure to the Hedging and Trading Entities on account of the Legacy Swaps is approximately $14.2 million.
I understand that for the avoidance of doubt, the Debtors do not seek relief with respect to the First Lien Hedges
and Swaps or the Legacy Swaps in the Trading Motion.

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203. I understand that the Hedging and Trading Activities and the Hedging and
Trading Arrangements are vital to the success of the Debtors various operational businesses and
directly affect the ability of the Debtors to successfully operate their generation and retail
divisions. I understand that as of the date hereof (the Petition Date), the Debtors estimate that
they owe approximately $50.8 million of payables
62
on account of the Prepetition Hedging and
Trading Arrangements (as defined below), approximately $43.7 million of which is secured by
collateral held by third parties (e.g., letters of credit or cash), and all of which will become due
and owing during the period between the Petition Date and entry of the Final Order (the Interim
Period) on account of the Prepetition Hedging and Trading Arrangements.
A. Overview of the Prepetition Hedging and Trading Arrangements.
204. I believe the Hedging and Trading Activities and the Hedging and Trading
Arrangements are vital to the success of the Debtors various operational businesses and directly
affect the ability of the Debtors to successfully operate their generation and retail divisions. I
understand that as of December 31, 2013, the Debtors annual underlying notional value
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across
all of their wholesale operations, based on energy prices for commodities sold and purchased in
their operations, including natural gas, electricity, coal, fuel-oil, uranium, renewable energy
credits, and emission allowances, is approximately $3.8 billion.
205. I understand that the Hedging and Trading Activities and the Hedging and
Trading Arrangements mitigate the risks that arise from the Debtors operations from changes in
the overall value of wholesale revenues and costs noted above. Specifically, I understand that

62
This number represents the amount of obligations after netting payables and receivables permitted to be netted
with the same counterparty under existing contractual terms.
63
Notional value refers to the fuel purchased by the Debtors and the electricity and ancillary services that the
Debtors sell through their wholesale operations, valued at current prevailing market prices for each respective
commodity.

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the Hedging and Trading Activities and Hedging and Trading Arrangements allow the Debtors to
utilize (a) physical commodity transactions to hedge price and delivery risk related to fuel inputs
(including natural gas, coal, uranium, and fuel oil) to the Debtors electricity generation and
mining operations, (b) physical transactions for electricity and ancillary services produced in the
electricity operations, and (c) financial derivatives that hedge price risk for both fuels and
electricity generation.
206. I understand that through the Hedging and Trading Activities and Hedging and
Trading Arrangements, the Debtors are able to hedge against such price fluctuations and thereby
protect the economic value of their operations by preventing substantial declines in cash flows. I
understand that the Debtors also conduct limited proprietary trading activities in certain
commodities that are core to the power generation operations. As an example, during the fiscal
years 2009 through 2013, the Hedging and Trading Activities provided a positive incremental
return to the Debtors underlying operations ranging from approximately $240 million to
$425 million on annual basis.
207. I understand that the Hedging and Trading Entities have approximately 72 active
prepetition Hedging and Trading Arrangements as of the Petition Date (the Prepetition Hedging
and Trading Arrangements and, together with the anticipated Postpetition Hedging and Trading
Arrangements, the Hedging and Trading Arrangements), all of which were entered into in
accordance with the Debtors Risk Management Guidelines.
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I understand that the Prepetition
Hedging and Trading Arrangements generally fall into the following three categories: (a) over-

64
In addition, I understand that the Debtors are party to a significant number of non-active hedging and trading
arrangements. Because transactions are not being conducted under these agreements, the Debtors do not have
any prepetition obligations arising under such agreements.

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the-counter transactions; (b) transactions with the Electric Reliability Council of Texas, Inc.
(ERCOT); and (c) Broker Arrangements (as defined in the Hedging and Trading Motion).
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1. Over-the-Counter Transactions.
208. I understand that the Hedging and Trading Entities enter into over-the-counter
physical and financial transactions related to natural gas, electricity, coal, fuel oil, uranium,
emission allowances, and other energy-related commodities directly with third parties (OTC
Counterparties), including transactions that are subject to the standard terms and conditions of
an ISDA Master Agreement (and related commodity Annexes for natural gas and electricity), an
EEI Master Power Purchase and Sale Agreement, or a NAESB Agreement (for natural gas
transactions), or other industry agreements, in each case, as modified pursuant to negotiations
between the parties (the OTC Agreements).
209. Due to the Debtors limited creditworthiness and in conjunction with industry
standards, I understand the Debtors are required on a regular basis to collateralize certain OTC
Agreements to provide hedging and trading counterparties with assurance that obligations under
the contracts will be met. As of the Petition Date, I understand that the Hedging and Trading
Entities are party to open and active Prepetition Hedging and Trading Arrangements with
approximately 68 OTC Counterparties.

65
As described further in the Debtors Motion of Energy Future Holdings Corp., et al., for Entry of (A) An Order
Authorizing the Debtors to (I) Maintain and Administer Customer Programs and Customer Agreements, (II)
Honor Prepetition Obligations Related Thereto, (III) Pay Certain Expenses on Behalf of Certain Organizations,
(IV) Fix Deadlines to File Proofs of Claim for Certain Customer Claims, and (V) Establish Procedures for
Notifying Customers of Commencement of the Debtors Chapter 11 Cases, Assumption of Customer
Agreements, and the Bar Dates for Customer Claims and (B) An Order Authorizing Certain of the Debtors to
Assume the Customer Agreements (the Customer Programs Motion), filed contemporaneously with the
Hedging and Trading Motion, I understand that the Debtors are seeking authority in the Customer Programs
Motion to assume certain customer agreements. I understand that by the Hedging and Trading Motion, the
Debtors reserve the right to treat any customer contract to be assumed in the Customer Programs Motion as a
Hedging and Trading Arrangement.

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210. As of the Petition Date, I understand that the Debtors estimate that they owe
approximately $7.1 million on account of prepetition obligations arising from the OTC
Agreements (net of any amounts that may be netted by cash receivables or secured by collateral
held by third parties (e.g., letters of credit or cash)), all of which will become due and owing
within the Interim Period.
2. ERCOT Transactions.
211. I understand that ERCOT manages the flow of electricity to 24 million people in
Texas and manages the supply of approximately 85% of the electricity consumption in Texas,
ERCOT schedules electricity on an electric grid that connects 40,500 miles of transmission lines
and more than 550 generation units. I understand that ERCOT also performs financial
settlements for the competitive wholesale electricity market and the majority of ERCOT is open
to retail electric competition - approximately 6.7 million customers (i.e. electricity meters) have
the ability to choose their retail electric provider. ERCOT is a membership-based 501(c)(4)
nonprofit corporation governed by a board of directors and subject to oversight by the Public
Utility Commission of Texas and the Texas Legislature. I understand that ERCOTs members
include consumers, cooperatives, electricity generators, electricity marketers, retail electricity
providers, investor-owned electric utilities (transmission and distribution providers), and
municipal-owned electric utilities.
212. Through the Debtors operations in the ERCOT region, I understand that the
Hedging and Trading Entities participate in: (a) the real-time energy market that allows a party
to be paid or charged for physical electricity and ancillary services provided to or taken from the
wholesale market; (b) financial transactions that are used by market participants to hedge
differences in prices in the day-ahead energy market; (c) point-to-point transactions that allow a
party to hedge against transmission congestion in ERCOTs real-time energy market between

98

two specific locations on the transmission system; and (d) auctions for the purchase and sale of
congestion revenue rights, which are contracts that allow a party to hedge against transmission
congestion costs in ERCOTs day-ahead energy market.
213. I understand that these markets provide the Hedging and Trading Entities with
particular channels to sell and procure electricity, ancillary services, and transmission congestion
instruments to mitigate the Debtors risks associated with the electricity generation assets and
retail electricity businesses, and are core to the commercial operations of those businesses. I
understand that the ability to participate in the ERCOT region is critical to the Debtors daily
cash flows. Moreover, I understand that the Hedging and Trading Entities consummate
transactions with ERCOT that they cannot execute with any other party or entity in light of
ERCOTs (a) central role in the Texas electricity system, (b) multi-dimensional investment
platform, and (c) facilitation of congestion revenue right actions as well as electricity and
ancillary services services, sales, and purchases.
214. I understand that to facilitate the Debtors Hedging and Trading Activities within
the ERCOT region, the Debtors and ERCOT have entered into Standard Form Market
Participation Agreements (SFAs) that include, among other things, an outline of the
procedures and processes used by ERCOT and other market participants to maintain the orderly
functioning of the ERCOT grid system (the ERCOT Protocols). I understand that without the
SFAs, the Debtors would be unable to access critical platforms provided by ERCOT. I also
understand that the transactions the Debtors consummate with ERCOT cannot be executed with
any other party or entity in light of ERCOTs pivotal role in the Texas electricity market.
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66
I understand that to ensure the Debtors access to the ERCOT region remains uninterrupted, the Debtors have
filed contemporaneously with the Hedging and Trading Motion, the Motion of Energy Future Holdings Corp.,
for Entry of an Order Authorizing Certain of the Debtors to Assume Standard Form Participation Agreements
with ERCOT which motion seeks authority to assume the SFAs with ERCOT (the ERCOT Assumption

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3. Broker Arrangements.
215. I understand that the Hedging and Trading Entities are party to two types of
broker arrangements, as follows: (collectively, the Broker Arrangements):
Clearing Broker and Exchange Arrangements. The Hedging and Trading Entities
are party to counterparty agreements with clearing brokers (the Clearing Brokers)
and centralized exchanges (the Exchanges) to clear transactions related to the
purchase and sale of electricity, fuel oil, natural gas, uranium, emission allowances,
and other energy-related products and physical and financial derivatives thereof,
through exchanges, including Intercontinental Exchange, Inc. (ICE), the New York
Mercantile Exchange (NYMEX), and Natural Gas Exchange (NGX). As
discussed in more detail below, certain of the Hedging and Trading Entities have
guarantees from their Debtor parent, TCEH, in favor of each of the Clearing Brokers
and are required to provide collateral as requested by each Clearing Broker in a
manner that is similar to ICE or NYMEX collateral requirements. Generally, each
Clearing Broker or Exchange has broad discretion under its arrangement to:
(a) terminate its agreement with the Hedging and Trading Entities; (b) refuse to enter
into future transactions for the benefit of the Hedging and Trading Entities; and (c)
cancel or liquidate the Hedging and Trading Entities open positions. As is common
in the Debtors industry, the Clearing Broker Arrangements are required to be fully-
collateralized on a daily basis and the value of such activity and related collateral
changes on a day-to-day basis.
Introductory Broker Arrangements. The Hedging and Trading Entities have entered
into agreements with certain brokers who facilitate purchase and sale negotiations
between the Hedging and Trading Entities and certain of their counterparties. In some
instances, the Hedging and Trading Entities compensate the brokers directly for their
services. In other instances, the Hedging and Trading Entities collect the fees to
which the brokers are entitled for their services from the counterparties (in
accordance with the terms set forth in the separately executed agreement between the
broker and the customer) and then remit such fees to the brokers.
B. Potential Exposure on Account of the Prepetition Hedging and Trading
Arrangements.
1. Potential Settlement Obligation Exposure.
216. I understand that the cumulative mark-to-market net value of all derivative assets
and liabilities related to the Prepetition Hedging and Trading Arrangements valued using

Motion). The relief requested in the Hedging and Trading Motion with respect to the SFAs and the ERCOT
Protocols is primarily meant to provide limited relief until such time as the Court has an opportunity to hear the
ERCOT Assumption Motion.

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standard industry valuation processes (and excluding Prepetition Hedging and Trading
Arrangements related to the First Lien Hedges and Swaps and the Legacy Swaps) is a net
liability of approximately $108 million as of the Petition Date before taking into consideration
collateral postings. I understand that this value is calculated on a daily basis and is subject to
fluctuations. I understand that the Debtors estimate that of the payables that are due and owing
on account of the Prepetition Hedging and Trading Arrangements as of the Petition Date
(approximately $50.8 million in total).
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Approximately $43.7 million is secured by collateral
held by third parties (e.g., letters of credit or cash), leaving the Debtors with approximately $7.1
million due and owing as of the Petition Date.
217. Even though I believe that continued performance under the Prepetition Hedging
and Trading Arrangements (other than payment of accrued prepetition obligations) on a
postpetition basis in the ordinary course of business is permitted under section 363(c)(1) without
court approval, the Debtors are seeking authority to continue performing postpetition obligations
under the Prepetition Hedging and Trading Arrangements out of an abundance of caution, and to
give counterparties to Hedging and Trading Arrangements comfort that the Debtors will honor
such obligations. I understand that the Debtors estimate that the Hedging and Trading Entities
will owe approximately $19.2 million on account of postpetition payment obligations arising
under the Prepetition Hedging and Trading Arrangements during the Interim Period. I also
understand that this estimate is based on the Debtors best estimates of potential value change
from current market prices.

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This number represents the amount of obligations after netting payables and receivables permitted to be netted
with the same counterparty under existing contractual terms.

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2. Potential Collateral Exposure.
218. I understand that as is typical in the industries that have wholesale trading
markets, an entity that participates in those markets must maintain an acceptable level of
creditworthiness or provide acceptable credit support, generally in the form of guarantees, letters
of credit, cash, prepayments, or other forms of collateral. In the ordinary course of business, the
Debtors post collateral to and receive collateral from counterparties to Hedging and Trading
Arrangement.
219. Specifically, I understand the Debtors provide collateral support relating to the
Prepetition Hedging and Trading Arrangements each as described in the Hedging and Trading
Motion.
220. As a general matter, I understand that the amount of credit support required under
a Hedging and Trading Arrangement is subject to daily recalculation and posting requirements.
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On any given day, with respect to any Hedging and Trading Arrangement, additional collateral
may be required of the Debtors or posted collateral may be returned to the Debtors. I understand
that in many instances, a counterparty to a Hedging and Trading Arrangement is required to post
collateral with the Debtors to secure such counterpartys performance. I understand that
generally, a failure by the Debtors or a counterparty to post or return credit support within the
contractually required time period is an event of default under the applicable Hedging and
Trading Arrangement.
221. I understand that the most significant component of collateral requirements under
most Hedging and Trading Arrangements is fairly straightforward each party is required to
post collateral equal to the amount of the counterpartys exposure, minus collateral already

68
I understand that a limited number of Hedging and Trading Arrangements entered into by the Debtors may have
fixed or other collateralization obligations that are calculated on a less frequent basis.

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posted and any applicable credit threshold.
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I understand that while exposure can be
calculated in a variety of ways under the Hedging and Trading Arrangements, exposure
generally means an amount equal to the difference between the contract price and the market
price times the volume of commodity remaining under the transaction, plus any amounts due for
performance, goods, and service already provided for which payment has not yet been made. I
understand that the key component of exposure is the net amount one party would owe to the
other in the event of a default under a Hedging and Trading Arrangement.
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222. To the extent the parties have actually posted collateral under the Hedging and
Trading Arrangement, I understand that the party receiving such performance assurance
collateral would subtract the value of such collateral from their exposure calculation, while the
party delivering the collateral would add the value of the collateral to their exposure calculation.
I understand that these amounts, together with the commodity exposure calculation are usually
calculated daily, with collateral either being posted or returned, by one party to the other, as
applicable, for the outstanding exposures. I understand that as the parties continue to perform
under the Hedging and Trading Arrangements and the volume of the underlying commodity
remaining under the transaction decreases, payments for performance are made, resulting in the
eventual return of the collateral securing the Hedging and Trading Arrangement, absent a
default.
223. I understand that the amount of credit support required to be posted by or to the
Debtors to maintain credit standing and avoid default under Hedging and Trading Arrangements

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I understand that because of the limited creditworthiness of the Debtors, they have limited ability to make use of
credit thresholds and are generally required to fully secure counterparties to Hedging and Trading
Arrangements.
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I understand that the collateral obligation under a Hedging and Trading Arrangement may not be limited to
exposure, as some counterparties may require additional security in connection with their trading requirements.

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is significantly influenced by the inherent volatility of commodity prices. I also understand that
commodity prices are directly influenced by a number of factors that can vary widely such as
overall supply and demand, weather, supply disruptions, production increases, regulatory
changes, and other factors. For example, the extreme winter weather recently experienced
across the United States has imposed significant volatility in the natural gas market. I understand
that the price of certain natural gas futures was recently exposed to large movements, and the
price volatility was as high as 34% to 37% during 2014 due to the extreme weather conditions.
224. I understand that a failure by the Debtors to post credit support within the
contractually required time period, which could be as little as a few hours after notice from the
third party, would be considered a default under the applicable Hedging and Trading
Arrangement. I understand that the third party would have the right to terminate and liquidate
the applicable Hedging and Trading Arrangement creating risks to the generation and retail
businesses. Therefore, I believe the ability of the Debtors to continue to meet their collateral
obligations during the Interim Period to maintain the protections afforded by the Hedging and
Trading Arrangements is critical.
225. Relatedly, I understand that due to the significant amount of activity that the
Debtors operations have with ERCOT, the Debtors issued a letter of credit in December 2009
for the benefit of ERCOT and in accordance with ERCOTs creditworthiness protocols. I
understand that by the Hedging and Trading Motion, and in an abundance of caution, the Debtors
seek authority in the orders to replace ERCOTs letter of credit with a postpetition letter of
credit.
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In addition, I understand that the Debtors anticipate that ERCOTs prepetition (or new,
postpetition) letter of credit will likely be sufficient to satisfy the Debtors prepetition collateral

71
For the avoidance of doubt, if the Debtors replace ERCOTs letter of credit with a new postpetition letter of
credit, the new postpetition letter of credit would not be subject to the Prepetition Collateral Posting Cap.

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posting obligations that may come due during the Interim Period, but, in an abundance of caution
are seeking authority in the Interim Order and the Final Order to satisfy prepetition collateral
posting obligations to ERCOT, subject to the Prepetition Collateral Posting Cap, as applicable.
226. Furthermore, in light of these concerns, I understand that the Debtors have
negotiated with their postpetition lenders and prepetition secured lenders to obtain authority to
grant TCEH Super-Priority Liens to counterparties to Postpetition Hedging and Trading
Arrangements and Prepetition Hedging and Trading Arrangements that constitute Secured
Commodity Hedge Agreements, in accordance with the TCEH DIP Orders and the TCEH Cash
Collateral Orders.
C. The Prepetition Hedging and Trading Arrangements are Critical to the
Debtors Financial Success and Business Operations and Limited Relief Is
Necessary to Preserve the Value of the Debtors Estates.
227. I understand that the commodity and financial instrument trading sector has been
historically and consistently resistant to conducting business with hedging and trading entities in
financial distress. I also understand that counterparties seeking to terminate Prepetition Hedging
and Trading Arrangements and discontinue activity prospectively will do so because of fear that
a chapter 11 hedging and trading partner is operating outside of the ordinary course of business
with respect to sophisticated transactions necessary to conduct the hedging and trading business
or because of a perception that the hedging and trading partner presents an unacceptable level of
risk exposure without adequate credit support.
228. At the same time, I understand that the Hedging and Trading Arrangements have
historically provided the Debtors with annual returns in the hundreds of millions of dollars that
add to and preserve the notional value across all of the Debtors operations. I understand that the
Debtors will lose this value opportunity if counterparties to Prepetition Hedging and Trading
Arrangements who believe they are entitled to certain safe-harbor protections with respect to the

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automatic stay provided under the Bankruptcy Code (described in more detail below) terminate
the Prepetition Hedging and Trading Arrangements or take other adverse action in response to
the Debtors inability to meet postpetition obligations.
229. In addition, I understand that the Debtors market activities specifically their
ability to mitigate price and delivery risks associated with energy commodities may be
adversely affected if the Debtors are not authorized to maintain the Prepetition Hedging and
Trading Arrangements in the ordinary course of business. Ultimately, I understand that these
circumstances could have a negative effect on the overall value of the Debtors business.
230. I understand that the Debtors intend to pay prepetition claims arising on account
of the Prepetition Hedging and Trading Arrangements, to pledge and transfer collateral under
Prepetition Hedging and Trading Arrangements, and to grant the TCEH Super-Priority DIP
Liens only to the extent necessary to preserve their businesses and under commercially
reasonable terms. To that end, the Debtors will use their commercially reasonable efforts to
condition the payment of prepetition claims and the posting of collateral under Prepetition
Hedging and Trading Arrangements upon each Prepetition Hedging and Trading Arrangement
counterpartys agreement to waive any rights it may have to liquidate, terminate, or accelerate its
Hedging and Trading Arrangements with respect to events of default relating to these chapter 11
cases (the Trading Continuation Agreement).
D. The Risk Management Guidelines.
231. I understand that as discussed earlier, agreements like the Hedging and Trading
Arrangements are common in the Debtors industry and are routinely used in the ordinary course
of business to mitigate exposure to commodity price fluctuations. I understand that as a measure
of governance and control, companies in the Debtors industry, like the Debtors, use risk
management guidelines to ensure that hedging and trading arrangements are closely monitored

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and are in the best interests of all the companys stakeholders. I also understand that to
encourage superior risk management control within the energy trading field, the Committee of
Chief Risk Officers, a nationally recognized, independent non-profit corporation comprised of
risk management leaders in the energy field, establish best practice guidelines.
232. To my knowledge, the Debtors Risk Management Guidelines are consistent with
these best practice guidelines and create a complementary framework for governance,
operational accountabilities, risk management procedures, and transaction management of the
Hedging and Trading Activities in the ordinary course of business.
233. As a further control, I understand that the Debtors utilize (a) an independent
internal audit function, under the direction of the Debtors audit committee, routinely conduct
internal audits of the Debtors Hedging and Trading Activities and risk management areas and
(b) an internal hedging policy, in effect as of the Petition Date, that establishes the parameters
within which the Debtors may enter into certain Hedging and Trading Arrangements (the
Internal Hedging Policy). I understand that the Internal Hedging Policy generally restricts the
Debtors ability to enter into Hedging and Trading Arrangements with respect to commodities
other than uranium and Powder River Basin coal that would result in the Debtors being party to
Hedging and Trading Arrangements that, on an aggregate basis, hedge more than 100% of the
Debtors projected exposure to such commodity for calendar year 2014. In addition, I
understand that the Internal Hedging Policy generally includes a restriction on the Debtors
ability to hedge or manage its exposure with respect to commodities other than uranium or
Powder River Basin coal, on an aggregate basis, for calendar year 2015, up to a percentage set
forth in the Internal Hedging Policy, which percentage is both consistent with the Debtors
hedging practices over the past two years for the period 13 24 months after any reference date

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and is less than 70% (the limits set forth in the Internal Hedging Policy described in the
preceding two sentences, the Hedging Ceiling). I understand that additionally, the internal
audit function often employs the use of third party subject matter experts in the field of energy
trading and risk management to assist in the audit work. Collectively, I understand that the Risk
Management Guidelines and the Debtors rigorous auditing process ensure that the Debtors
deploy a robust governance and control function at all times related to the potential risks
involved with the Hedging and Trading Arrangements. I understand that this activity helps
ensure that the Debtors enter into only those Hedging and Trading Arrangements that are in the
best interests of the Debtors, their estates, and other parties in interest. I also understand that the
Debtors will continue to abide by the Risk Management Guidelines, including the Internal
Hedging Policy and their audit practices throughout these chapter 11 cases.
1. Risk Governance Structure.
234. I understand that each of the Debtors business units has a group of senior level
employees dedicated to discussing and monitoring the specific risks to which each particular
business unit is vulnerable (each such group, a Risk Management Committee and, collectively,
the Risk Management Committees). I understand that for the Hedging and Trading Entities
hedging and trading business, Luminant Energy Company LLC, there is a Risk Management
Committee that is responsible for identifying Hedging and Trading Activities risks, including
market, liquidity, credit, operational, legal, regulatory, and other risks and managing such risks
in accordance with the Risk Management Guidelines (Hedging and Trading Activities Risks).
I understand that this Risk Management Committee also reviews and approves the types of
transactions that the Hedging and Trading Entities can enter into and reviews significant risks for
the Hedging and Trading Entities on a regular basis.

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235. In addition to the Risk Management Committees, I understand that the Hedging
and Trading Entities also maintain (a) a separate compliance group (the Compliance Group)
that is responsible for creating and enforcing internal policies and procedures to comply with
federal and state laws and regulations, and that reports to the vice-president of regulatory law and
the chief compliance officer for the Hedging and Trading Entities and (b) a separate risk
management team that supervises specialized risk teams in their monitoring, measurement, and
reporting of the Hedging and Trading Activities Risks, and that reports directly to the vice
president of risk management for EFH and chief financial officer for EFH (the EFH Risk
Management Team). Collectively, I understand that both groups monitor compliance with
internal and external controls and processes, including legal and regulatory compliance, adhering
to internal risk policies and limits, supervising and reporting processes, and providing transaction
governance processes.
2. Transaction Governance.
236. I understand that the Hedging and Trading Entities are subject to certain
transaction governance processes that ensure the Hedging and Trading Activities are aligned
with acceptable risk levels. I also understand that the Hedging and Trading Entities execute both
standard and non-standard transactions, (respectively, the Standard Transactions and
Non-Standard Transactions and, collectively, the Hedging and Trading Transactions). I
understand that standard Transactions generally require a less rigorous approval process than
Non-Standard Transactions. I understand that this is because Standard Transactions: (a) use
only products pre-approved by the Risk Management Committees; (b) have standard terms and
conditions; (c) have specified term limits; (d) are frequently used to mitigate volume and price
risk on a regular basis; (e) are frequently used in the Hedging and Trading Activities and well
understood by the commercial and support teams for the Hedging and Trading Entities; and

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(f) generally operate under industry developed contracts.
237. By contrast, I understand that Non-Standard Transactions are either: (a) a
combination of Standard Transactions; or (b) Standard Transactions with additional complicating
and/or unique provisions, such as atypical settlement dates or complex valuation requirements or
higher required levels of operational support. I understand that non-Standard Transactions
require two levels of internal approvals. First, I understand that Non-Standard Transactions must
be reviewed by eight specified practice areas to ensure that the transactions various risks have
been assessed and that the practice areas can accommodate the transaction into daily
operations.
72
I understand that second, Non-Standard Transactions must be approved in
accordance with the Debtors corporate risk policy.
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238. I understand that different levels of approval are required depending on the size
and tenor of the Hedging and Trading Transaction and whether the transaction is Standard or
Non-Standard. I also understand that the approval hierarchy is based on individual authorities
given to personnel based on their role and experience within the Hedging and Trading Entities.
239. I understand that the Hedging and Trading Entities also govern transactions by
utilizing individual limits that provide specific limits to each person that has hedging and trading
authority. I also understand that individual hedging and trading personnel limits are set by the
appropriate TCEH Hedging and Trading Entity vice-president and the EFH vice president of risk
management on the basis of instrument, commodity, tenor, region, experience of the individual,

72
As a further control, I understand that the Hedging and Trading Entities commercial teams are segregated from
discussions relating to the management of the EFH Risk Management Team as well as discussion relating to the
responsibilities and compensation of the EFH Risk Management Team.
73
I understand that the Debtors corporate risk policy is established by the Debtors corporate risk management
group, which is comprised of: (a) the audit committee of the EFH Board; (b) the strategy and policy committee,
which includes the chief risk officer for EFH; (c) each business unit Risk Management Committees; and (d) the
EFH Risk Management Team.

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and the individuals role within the business and monitored by the EFH Risk Management Team.
3. Valuation and Risk Parameters.
240. I understand that in accordance with the Debtors corporate risk policy, the
Debtors use individual trader limits, mark-to-market valuations of all transactions, position and
profit and loss reporting, at risk measurements, sensitivities/stress testing, and risk/return
metrics to measure and control the Hedging and Trading Activities Risks associated with the
Hedging and Trading Transactions. I understand that the specific risk management measures
employed by the Hedging and Trading Entities are each as described in the Hedging and Trading
Motion.
241. I believe the continuation of the Hedging and Trading Activities, at all times
subject to the Risk Management Guidelines, is key to maximizing the value of the Debtors
estates. I understand that through the establishment of a defined risk governance structure, the
creation of parameters for transaction governance, and the imposition of valuation and risk
parameters and reporting processes applicable to all Hedging and Trading Transactions, the
Debtors ensure that such transactions are closely scrutinized and in the best interests of the
Debtors and all parties in interest.
Taxes and Fees Motion.
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X.
242. In the Taxes and Fees Motion, the Debtors request that the Court schedule a final
hearing as soon as practicable after the 21st day following the Petition Date to consider approval
of the Taxes and Fees Motion on a final basis. Pursuant to the Interim Order, I understand that
the Debtors seek authority to satisfy prepetition obligations on account of Taxes and Fees that
come due during the Interim Period in an aggregate amount not to exceed $80.47 million, of

74
See Motion of Energy Future Holdings Corp., et al., for Entry of an Order Authorizing the Debtors to Pay
Certain Prepetition Taxes and Fees, filed contemporaneously herewith.

111

which approximately $10 million (12.4%) is in the form of trust fund obligations which the
Debtors collect from non-Debtors and/or hold in trust for payment to the Taxing and Regulatory
Authorities. Pursuant to the Final Order, I understand that the Debtors seek authority to satisfy
all prepetition obligations on account of Taxes and Fees in an aggregate amount not to exceed
$146.74 million, of which approximately $10 million (6.8%) is in the form of trust fund
obligations.
A. The Debtors Tax Obligations.
243. I understand that in the ordinary course of business, the Debtors: (a) incur and/or
collect taxes, including margin, sales, use, property, and miscellaneous taxes in the operation of
their businesses (collectively, the Taxes); (b) incur business license, permit fees and other
assessments and charges (collectively, the Fees) necessary to operate their businesses; and
(c) remit such Taxes and Fees to various taxing, licensing, administrative, and governmental or
similar authorities (collectively, the Taxing Authorities, the Regulatory Authorities, and,
collectively the Taxing and Regulatory Authorities) and make payments to various third
parties for Taxes and Fees who, in turn, remit such Taxes and Fees to the Taxing and Regulatory
Authorities. I understand that a list of the current Taxing Authorities is attached to the Taxes
Motion as Exhibit B and incorporated by reference, and a list of the current Regulatory
Authorities is attached to the Taxes Motion as Exhibit C and incorporated by reference. In
many instances, I understand that the Debtors negotiate with the Taxing and Regulatory
Authorities to determine the amount of Taxes and Fees due and payable by the Debtors. I
understand that generally, the Debtors pay the Taxes and Fees monthly, quarterly, semi-annually,
or annually, in each case as required by applicable laws, rules, and/or regulations. I understand
that additional detail with respect to the main categories of Taxes and Fees for which the Debtors
are liable is provided below.

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1. Income and Margin Taxes.
244. I understand that the Debtors pay a Texas margin Tax (the Texas Margin Tax)
to operate their businesses in Texas. I understand that the Texas Margin Tax is calculated as a
percentage of estimated combined taxable income for the tax year, minus a deduction to account
for costs of goods sold. I also understand that in May of each year, 90% of the Texas Margin
Tax from the previous tax year comes due, and in August of each year, the remaining 10%
comes due, subject to a potential true-up payment. I understand that the Debtors estimate that
approximately $70 million in Texas Margin Tax obligations have accrued and remain unpaid as
of the Petition Date, approximately $54 million of which will become due and owing during the
Interim Period.
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245. I understand that the Debtors are also required to report and pay state income and
margin Taxes in other jurisdictions (the Other State Income and Margin Taxes), as described
in Exhibit B of the Taxes and Fees Motion. I understand that the Debtors estimate that
approximately $10,000 in Other State Income and Margin Tax obligations have accrued and
remain unpaid as of the Petition Date.

75
I understand that pursuant to two tax sharing agreements entered into by EFH Corp. with: (a) EFCH, TCEH
LLC and certain of its subsidiaries, and EFIH; and (b) Oncor and Oncor Holdings (together the TSAs and the
parties to the TSAs described in (a) and (b), the TSA Parties), EFH Corp. files Texas state margin tax returns
that include the TSA Parties results, and subsequently settles intercompany claims with each of the TSA
Parties on account of the Texas state margin taxes that EFH Corp. has paid on their behalf. I understand that
each of the TSA Parties is individually liable for their share of Texas state law margin taxes.
By the Taxes and Fees Motion, the Debtors seek authority for EFH Corp. to continue to pay the Texas state
margin taxes on the TSA Parties behalf pursuant to the terms of the TSAs. The authority to settle any
intercompany claims that arise due to EFH Corp,s payment of the Texas state margin tax on behalf of the TSA
Parties is addressed in the Motion of Energy Future Holdings Corp., et al., for Entry of an Order (A)
Authorizing the Debtors to (I) Continue Using Their Existing Cash Management System, (II) Maintain Existing
Bank Accounts and Business Forms, and (III) Continue Using Certain Overnight Investment Accounts; (B)
Authorizing Continued Intercompany Transactions and Netting of Intercompany Claims; and (C) Granting
Postpetition Intercompany Claims Administrative Expense Priority, Docket No. [__].

113

2. Sales and Use Taxes.
246. I understand that the Debtors incur and collect an assortment of sales Taxes
(Sales Taxes) and use Taxes (Use Taxes and, together with Sales Taxes, the Sales and Use
Taxes) in connection with the operation of their businesses. I also understand that the Debtors
collect Sales Taxes from their customers on behalf of the applicable Taxing Authorities and
periodically remit the Sales Taxes to the applicable Taxing Authority on the basis of Sales Taxes
actually billed to customers.
247. I understand that the Debtors also incur Use Taxes in connection with their
purchase of certain tangible personal property or taxable services from vendors. Use Taxes arise
when the Debtors purchase items or services from a vendor who is not registered to collect Sales
Taxes for Texas or when the Debtors exercise their direct pay permit exemption certificates. In
either circumstance, I understand that such vendors are not obligated to charge or remit Texas
Sales Taxes. I understand that Use Taxes may also arise when a vendor fails to bill the Debtors
the appropriate tax or amount of tax. Nevertheless, I understand that the Debtors are obligated to
self-assess and pay the Use Taxes, when applicable, to the relevant Taxing Authorities.
248. I understand that in an average month, the Debtors incur an obligation of
approximately $15 million in Sales and Use Taxes to the Taxing Authorities. I understand that
the Debtors estimate that approximately $10 million in Sales Taxes have accrued and remain
unpaid as of the Petition Date all of which will become due and owing within the first 21 days
following the Petition Date, and approximately $5.6 million in Use Taxes have accrued and
remain unpaid as of the Petition Date, all of which will become due and owing within the first 21
days following the Petition Date.

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3. Real and Personal Property Taxes.
249. I understand that approximately 500 tax jurisdictions in Texas where the Debtors
business operations are located possess the authority to levy property Taxes against the Debtors
real and personal property (collectively, the Real and Personal Property Taxes). I understand
that the Debtors typically pay Real and Personal Property Taxes in the ordinary course of
business as such Taxes are invoiced. In an average month, I understand that the Debtors accrue
approximately $16.25 million in Real and Personal Property Taxes. The Debtors estimate that
approximately $43 million in Real and Personal Property Taxes have accrued and remain unpaid
as of the Petition Date.
4. Texas Gross Receipts Tax.
250. I understand that in addition to the Taxes described above, the Debtors must pay a
state gross receipts tax in Texas that is imposed on every utility company located in an
incorporated town having a population greater than 1,000 as reflected in the last federal census
(the Texas Gross Receipts Tax). In an average month, I understand that the Debtors incur an
obligation of approximately $5 million on account of the Texas Gross Receipts Tax to certain
Taxing Authorities in Texas.
B. The Debtors Fee Obligations.
251. I understand that the Debtors must obtain various business licenses, permits, and
certificates and pay corresponding Fees in certain jurisdictions in which they operate. In
particular, I understand that the Regulatory Authorities described on Exhibit C who have
oversight over the Debtors generation and/or retail activities require the Debtors to obtain
licenses and periodically remit related fees (collectively, the Regulatory License Fees). I
understand that the Debtors estimate that approximately $18.13 million in Regulatory License
Fees have accrued and remain unpaid as of the Petition Date. I understand that the Regulatory

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License Fees consist of a number of different types of fees, several of which are described in the
Taxes and Fees Motion.
252. Moreover, I understand that the Debtors are also required to pay certain
surcharges on their off road heavy-duty diesel equipment. Specifically, I understand that under
the Texas Emissions Reduction Plan, which provides funding for various clean-air initiatives in
Texas, a 2% surcharge is applied to the sale, lease, or rental price of heavy-duty, off-road diesel-
powered equipment, in addition to regular state and local sales taxes (the Heavy Duty Diesel
Equipment Fees). I understand that the Debtors remit approximately $21,900 per month to the
Texas Comptroller on account of the Heavy Duty Diesel Equipment Fees. I understand that the
Debtors estimate that approximately $20,000 in Heavy Duty Diesel Equipment Fees have
accrued and remain unpaid as of the Petition Date.
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253. Finally, I understand that the Debtors are required to pay registration Fees
anytime a motor vehicle used as a company car is registered for use on the public highways
(collectively, the Vehicle Registration Fees). I understand that the amount of Vehicle
Registration Fees the Debtors pay varies according to: (a) the type of each vehicle; and (b) the
state in which the motor vehicle is registered. I understand that the Debtors directly pay
approximately $4,000 a month to the Taxing Authorities on account of the Vehicle Registration
Fees. I understand that the Debtors estimate that approximately $5,000 in Vehicle Registration
Fees have accrued and remain unpaid as of the Petition Date.

76
In connection with the Debtors use of heavy duty diesel equipment, the Debtors are required to file a Texas
fuels tax report (stating the amount of tax-free dyed diesel fuel purchased, sold, and used in an exempt manner)
as well as a Texas petroleum products delivery fee report (required by all entities who pay Heavy Duty Diesel
Equipment Fees). Neither of these reports imposes cash obligations on the Debtors, and the Debtors are not
seeking any additional relief in connection with these reports.

116

Utilities Motion.
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XI.
394. In the Utilities Motion, the Debtors seek entry of orders: (a) determining that the
Utility Providers have been provided with adequate assurance of payment within the meaning of
section 366 of the Bankruptcy Code; (b) approving the Proposed Adequate Assurance (defined
in the Utilities Motion); (c) prohibiting the Utility Providers from altering, refusing, or
discontinuing services on account of prepetition amounts outstanding and on account of any
perceived inadequacy of the Proposed Adequate Assurance pending entry of the Final Order;
(d) determining the Debtors are not required to provide any additional adequate assurance
beyond what is proposed by the Utilities Motion.
395. As part of the Debtors business operations, I understand that the Debtors incur
utility expenses for electric, gas, water, telephone, internet, waste disposal, and other similar
services (the Utility Services) in the ordinary course of business from approximately 110
utility providers (collectively, the Utility Providers).
78
I understand that the Utility Providers
that provide Utility Services to the Debtors as of the Petition Date are identified in Exhibit C of
the Utilities Motion (the Utility Service List).
79

77
See Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders Determining
Adequate Assurance of Payment for Future Utility Services, filed contemporaneously herewith.
78
I understand that certain of the Utility Providers may also qualify for treatment under the Motion of Energy
Future Holdings Corp., et al., for Entry of Interim and Final Orders Authorizing the Debtors to (A) Continue
Performance Under Hedging and Trading Arrangements, (B) Pledge Collateral and Honor Obligations
Thereunder, and (C) Enter Into and Perform Under New Postpetition Hedging and Trading Arrangements
(the Hedging and Trading Agreements Motion), filed contemporaneously herewith. I understand from
Debtors counsel that the applicability of the Hedging and Trading Arrangements Motion to such Utility
Providers should not be treated as an admission by the Debtors that the safe harbor provisions of the Bankruptcy
Code do or do not apply to those Utility Providers. From Debtors counsel I understand that the Debtors reserve
the right to argue that section 366 applies to a specific Utility Provider.
79
I understand from Debtors counsel that the Utility Service List is not an admission that any entity is a utility
provider within the meaning of section 366 of the Bankruptcy Code, and the Debtors reserve the right to contest
any such characterization in the future.

117

396. On average, I understand that the Debtors spend approximately $108.8 million
each month on Utility Services pursuant to approximately 640 separate accounts, of which
approximately $106.8 million is attributable to Utility Providers that provide electricity
transmission and distribution services (the TDSPs). I understand that as of the Petition Date,
the Debtors estimate that approximately $194.5 million in utility costs have accrued and remain
outstanding, approximately $185.5 million of which is attributable to TDSPs. I understand that
the Debtors not owe any past due amounts to the Utility Providers.
397. I believe that uninterrupted Utility Services are essential to the Debtors ongoing
operations and, therefore, to the success of their reorganization. Indeed, I understand that any
interruption of Utility Services, even for a brief period of time, would negatively affect the
Debtors operations, revenues, and cash flows, seriously jeopardizing the Debtors
reorganization efforts and, ultimately, recoveries to creditors. Accordingly, I believe it is critical,
both for the Debtors and for the Debtors customers, that the Debtors maintain uninterrupted
access to Utility Services during these chapter 11 cases.
A. The Proposed Adequate Assurance.
254. I understand that the Debtors intend to pay postpetition obligations owed to the
Utility Providers in the ordinary course of business. I understand that the Debtors expect that
cash from operations and cash on hand will be sufficient to pay postpetition obligations related to
their Utility Services.
255. Nevertheless, I understand that to provide additional assurance of payment for
future services to the Utility Providers other than (a) Utility Providers, including ERCOT, that
have already been provided a deposit letter of credit that, even accounting for any draws to pay
prepetition amounts, will be equal to, or greater than, two weeks of Utility Services, (b) Utility

118

Providers that have been paid in advance for Utility Services, and (c) the TDSPs,
80
the Debtors
propose to deposit $1 million (the Adequate Assurance Deposit) into a newly-created,
segregated, interest-bearing account (the Adequate Assurance Deposit Account) within 20
days of the Petition Date. I understand that the amount of the Adequate Assurance Deposit
equals the estimated aggregate cost for two weeks of Utility Services for Utility Providers (other
than the Utility Providers noted above), calculated as a historical average over the past 12
months.
256. I understand that the Adequate Assurance Deposit will be held for the benefit of
Utility Providers during the pendency of these chapter 11 cases, provided that to the extent any
Utility Provider receives any value from the Debtors as adequate assurance of payment, the
Debtors may reduce the Adequate Assurance Deposit maintained in the Adequate Assurance
Account by such amount.
257. I understand that the Debtors submit that the Adequate Assurance Deposit, in
conjunction with the Debtors demonstrated ability to pay for future Utility Services in the
ordinary course of business, any other prepetition or postpetition value provided by the Debtors
to the Utility Providers, and other relief granted by the Court in favor of the Utility Providers
(together, the Proposed Adequate Assurance) constitutes sufficient adequate assurance.

80
Pursuant to section 366(c)(2) of the Bankruptcy Code, I understand from Debtors counsel that the Debtors need
not provide adequate assurance of payment until 30 days after the Petition Date. The Debtors submit that the
relief requested pursuant to the Motion of Energy Future Holdings Corp., et al., for Entry of (A) an Order
Authorizing Certain of the Debtors to Pay Certain Prepetition Transition Charges and Delivery Charges and
(B) an Order Authorizing Certain of the Debtors to Assume Transmission and Distribution Service Agreement
(the TDSP Motion), filed contemporaneously with the Utilities Motion, will satisfy any adequate assurance
obligation with respect to the TDSPs within the required 30-day period. From Debtors counsel I understand
that the Debtors and the TDSPs respective rights under section 366 of the Bankruptcy Code are reserved and,
in the event the Court does not grant the relief sought in the TDSP Motion, the amount of the Adequate
Assurance Deposit may increase by up to $53 million.

119

TDSPs Assumption Motion.
81
XII.
258. In the TDSPs Assumption Motion, Debtor entities TXU Energy Retail Company
LLC, 4Change Energy Company LLC, and Luminant ET Services Company (collectively, the
REP Debtors) are each party to one or more of the 23 Delivery Agreements on the list annexed
as Exhibit 1 to Exhibit B attached to the TDSPs Assumption Motion. I understand that each
Delivery Agreement is between a REP Debtor and one of seven non-debtor regulated
transmission and distribution utility service providers, six of which are non-affiliated entities (the
Unaffiliated TDSPs"),
82
and the other of which is Oncor Electric Delivery Company LLC
(Oncor and, together with the Unaffiliated TDSPs, the TDSPs). I understand that Oncor is
an affiliate of the Debtors, but is not a debtor in these chapter 11 cases.
83
Debtors estimate that the REP Debtors owe approximately $185.2 million in the aggregate to the

81
See Motion of Energy Future Holdings Corp., et al., for Entry of (A) an Order Authorizing Certain of the
Debtors to Pay Certain Prepetition Transition Charges and Delivery Charges and (B) an Order Authorizing
Certain of the Debtors to Assume Transmission and Distribution Service Agreements, filed contemporaneously
herewith.
82
I understand that the Unaffiliated TDSPs are AEP Texas Central Company, AEP Texas North Company,
Centerpoint Energy Houston Electric, LLC, Sharyland Utilities, L.P., Nueces Electric Cooperative, Inc., and
Texas-New Mexico Power Company.
83
Specifically, I understand that Oncor is an affiliate of the Debtors that is 80% owned by non-Debtor Oncor
Electric Delivery Holdings Company LLC (Oncor Holdings and, together with its direct and indirect
subsidiaries, including Oncor, the Oncor Ring-Fenced Entities), which, in turn, is 100% owned by the Debtor
entity Energy Future Intermediate Holding Company LLC (EFIH), a direct subsidiary of the Debtors
corporate parent Energy Future Holdings Corp. (EFH Corp.). I understand that substantially all of the
common stock of EFH Corp. is held by Texas Energy Future Holdings Limited Partnership (Texas Holdings
and, together with EFH Corp. and its direct and indirect subsidiaries other than the Oncor Ring-Fenced Entities,
the Texas Holdings Group). I understand that EFH Corp. and Oncor have implemented certain structural and
operational ring-fencing measures based on commitments made by Texas Holdings and Oncor to the PUC (as
defined in the TDSP Motion) that are intended to enhance the credit quality of Oncor. I understand that these
measures serve to mitigate Oncors and Oncor Holdings credit exposure to the Texas Holdings Group and to
reduce the risk that the assets and liabilities of Oncor or Oncor Holdings would be substantively consolidated
with the assets and liabilities of the Texas Holdings Group in the event of a bankruptcy of one or more of those
entities. Accordingly, I understand that EFH Corp. and EFIH do not control and do not consolidate Oncor for
financial reporting purposes. The ring-fencing measures are described in further detail in the First Day
Declaration.

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TDSPs under the Delivery Agreements as of the Petition Date, approximately $143.1 million of
which the REP Debtors owe to Oncor.
A. The TDSPs Are Critical to the Debtors Business Operations.
259. The REP Debtors cannot and do not own or operate electric distribution facilities
in Texas. Rather, I understand that the REP Debtors rely on the TDSPs distribution facilities
that connect the interconnected transmission grid and generation resources with customers.
260. I understand that the TDSPs distribution facilities receive electricity from the
interconnected transmission system and distribute electricity to points of delivery, including
customers. I understand that the TDSPs are regulated because they are, in nearly every instance,
the sole provider of delivery service in any particular service area where the REPs are certified to
do business.
B. Prepetition Amounts Owed to the TDSPs and Outstanding Letters of Credit.
261. I understand that the amounts that the REP Debtors pay to the TDSPs fall into two
categories Delivery Charges and Transition Charges, each of which is discussed below.
1. Delivery Charges.
262. The first category of amounts that the REP Debtors pay to the TDSPs is known as
Delivery Charges. I understand that the Delivery Charges are based on the PUC-approved
terms and conditions that govern each TDSPs delivery services (the Tariffs), including the
rates that TDSPs may charge for such services.
84
I also understand that the Delivery Charges
constitute approximately 90% to 95% of the REP Debtors payments to TDSPs.

84
From Debtors counsel I understand that PUC regulations adopt a standard Tariff for all TDSPs. See Tex.
Admin. Code 25.214. Chapter 4 of the Tariff, which concerns remedies, is applicable to all TDSPs and
cannot be modified. PUC regulations also adopt a standard Tariff for all electric cooperatives, like Nueces
Electric Cooperative, Inc., that have opted to offer retail customer choice. See Tex. Admin. Code 25.215.
Like the TDSP standard Tariff, Chapter 4 of this Tariff, relating to remedies, applies to all such electric
cooperatives. Copies of the Tariffs can be found on the PUC website at
http://www.puc.texas.gov/industry/electric/rates/TDR.aspx.

121

263. As provided in the following table, as of the Petition Date, I understand that the
REP Debtors owe approximately (a) $32.4 million in the aggregate to the Unaffiliated TDSPs on
account of Delivery Charges (the Unpaid Delivery Charges), of which approximately $19.9
million has been secured with prepetition letters of credit (the Delivery Charge LCs), and
(b) $138.1 million in the aggregate to Oncor on account of Unpaid Delivery Charges:
85

TDSP Outstanding Delivery
Charges
Delivery Charge LCs
AEP Texas Central Company $5,000,000 $3,400,000
AEP Texas North Company $2,800,000 $1,000,000
Centerpoint Energy Houston Electric, LLC $20,900,000 $13,800,000
Sharyland Utilities, L.P. $25,000 None
Nueces Electric Cooperative, Inc. None None
Texas-New Mexico Power Company $3,600,000 $1,700,000
Oncor Electric Delivery Company LLC $138,100,000 None

264. I estimate that $100 million of the Delivery Charges will come due during the
Interim Period. I understand that the REP Debtors seek authority pursuant to the order to
continue to pay approximately $26 million of Unpaid Delivery Charges to the Unaffiliated
TDSPs as such amounts come due in the ordinary course during the Interim Period. I understand
that the Debtors seek authority to honor all Unpaid Delivery Charges (including amounts owed
to Oncor) pursuant to the Assumption Order.

85
I understand that PUC regulations do not require the REP Debtors to maintain the Delivery Charge LCs
because, as of the Petition Date, the REP Debtors have not defaulted on their obligations. I understand that the
REP Debtors anticipate that the Unaffiliated TDSPs may draw on the Delivery Charge LCs after the Petition
Date. I understand that the REP Debtors do not believe that the Delivery Charge LCs constitute property of
their estates such that the TDSPs require Court authority to draw on the Delivery Charge LCs. Nevertheless, I
understand that for purposes of clarity, the Debtors seek authority in both the Interim Order and the Assumption
Order allowing (but not directing) the TDSPs to draw on the Delivery Charge LCs as payment for any
outstanding amounts that the REP Debtors owe on account of Delivery Charges.

122

2. Transition Charges.
265. I understand that the second category of amounts that the REP Debtors pay to the
TDSPs is known as Transition Charges. I understand that the Transition Charges allow TDSPs
to recover certain PUC-approved costs that were securitized in conjunction with Texass
transition from a fully-regulated electricity market to an unbundled, competitive retail and
generation market. I understand that the Transition Charges constitute approximately 5% to 10%
of the REP Debtors payments to the TDSPs.
266. I understand that the PUC has issued financing orders that entitle the TDSPs to
recover the Transition Charges, and several of the TDSPs have issued securities known as
transition bonds that securitize the value of the Transition Charges (the Transition Bonds).
86

I understand that for the TDSPs that have issued Transition Bonds,
87
each of the applicable
Tariffs provides for the collection and payment of Transition Charges to the applicable TDSP, as
well as the circumstances under which a REP must provide security for its payment of Transition
Charges to the applicable TDSP.
88

86
Pursuant to PUC financing orders, certain TDSPs are also entitled to use securitization financing to recover
costs of restoring service and infrastructure associated with electric power outages as a result of hurricanes and
other weather-related events or natural disasters (the System Restoration Charges). Under PUC regulations
and applicable Tariffs, Transition Charges include System Restoration Charges, and Transition Bonds include
bonds issued to securitize System Restoration Charges. See Tex. Admin. Code 36.401-07. Centerpoint
Energy Houston Electric, LLC has issued Transition Bonds to securitize System Restoration Charges.
Accordingly, the Unpaid Transition Charges owed by the REP Debtors to Centerpoint Energy Houston Electric,
LLC include prepetition System Restoration Charges, which are secured by Transition Charge Security in the
form of letters of credit.
87
Sharyland Utilities, L.P., Nueces Electric Cooperative, Inc., AEP Texas North Company, and Texas-New-
Mexico Power Company have not issued Transition Bonds. Accordingly, I understand that these TDSPs do not
collect securitized Transition Charges from the REP Debtors. Texas-New Mexico Power Company collects
PUC-approved, non-securitized competitive transition charges. Pursuant to section 6.1.1.3 of the Tariff, these
competitive transition charges are treated as Delivery Charges. Accordingly, I understand that these amounts
are included in the estimated amount of Unpaid Delivery Charges owed to Texas-New Mexico Power
Company.
88
I understand from Debtors counsel that pursuant to PUC regulations and the Tariffs, each REP that pays
Transition Charges to a TDSP must meet certain long-term unsecured credit ratings, or provide security for the

123

267. As provided in the following table, as of the Petition Date, I understand that the
REP Debtors owe approximately (a) $9.7 million in the aggregate to the Unaffiliated TDSPs on
account of Transition Charges (the Unpaid Transition Charges), of which approximately $15.8
million has been secured with prepetition letters of credit, deposits or other collateral posted for
the benefit of the Transition Bond indenture trustee (the Transition Charge Security), and
(b) $5 million in the aggregate to Oncor on account of Unpaid Transition Charges, of which
approximately $10.1 million has been secured with a Transition Charge Security for the benefit
of Oncors Transition Bond indenture trustees:
89

TDSP Outstanding Transition
Charges
Transition Charge Security
AEP Texas Central Company $3,600,000 $5,100,000
Centerpoint Energy Houston Electric, LLC $6,100,000 $10,700,000
Oncor Electric Delivery Company LLC $5,000,000 $10,100,000

268. I understand from Debtors counsel that Texas law affords special protection in
respect of the Transition Charges. I understand that in particular, the Texas electric industry
restructuring and unbundling legislation (which created the competitive retail market) and the
PUCs related financing orders provide that Transition Bonds are to be issued by bankruptcy-
remote, ring-fenced subsidiaries of the TDSPs. Moreover, pursuant to state law, I understand
from Debtors counsel that the Transition Bonds are secured by a lien on transition property,

Transition Charges. Security may take the form of a deposit, guaranty, surety bond, or letter of credit. See
P.U.C. Subst. R. 25.108.
89
I understand from Debtors counsel that under PUC regulations, the REP Debtors would need to replace the
Transition Charge Security if drawn and, in any event, the REP Debtors anticipate remaining current with their
obligations to the TDSPs with respect to Transition Charges during these chapter 11 cases such that the TDSPs
will not need to seek recourse against the Transition Charge Security. Accordingly, the Debtors anticipate that
the TDSPs will not seek recourse against the Transition Charge Security and that, to the extent a letter of credit
securing Transition Charges expires during these chapters 11 cases, the REP Debtors will replace such letter of
credit under their post-petition financing facility or provide other security.

124

which includes the right to collect Transition Charges from the REP Debtors and any Transition
Charges collected by the REP Debtors from their customers. I understand that the Transition
Bond indenture trustees lien on transition property is not affected by the commingling of
funds.
90
Importantly, I understand that all of the Unpaid Transition Charges have been
securitized with Transition Bonds, and are fully secured by the Transition Charge Security. I
also understand that because the Transition Charge Security is security for obligations that are
owed to the Transition Bond indenture trustees by entities collecting Transition Charges, the
Transition Charges paid by the REP Debtors to the TDSPs will ultimately be paid to the
Transition Bond indenture trustees.
C. Additional Regulatory Implications.
269. I understand from Debtors counsel while the Debtors would seek to avoid any
negative issues associated with the REP Debtors failure to pay the Transition Charges and the
Delivery Charges, the benefits of avoiding any such litigation outweigh the costs of paying the
amounts requested in the TDSP Motion. Indeed, I understand that the REP Debtors failure to
pay the Transition Charges and Delivery Charges could negatively affect the Debtors in at least
five ways.
270. First, I understand that the REP Debtors failure to make timely payments in
respect of Transition Charges or Delivery Charges to a TDSP would permit PUC staff or any
affected person to bring a complaint seeking to suspend or revoke the REP Debtors operating
certificate with the PUC (the REP Certificate).
91
I understand that such an action, if

90
See Tex. Util. Code. 39.309(a) (providing for exclusive lien on transition property); Tex. Util. Code
39.309(e).
91
Specifically, the Texas Administrative Code provides as follows:
A certificate granted pursuant to this section is subject to amendment, suspension, or revocation by the
commission for a significant violation of PURA, commission rules, or rules adopted by an independent

125

successful, would have drastic consequences for the Debtors business operations: if the PUC
suspended the REP Certificates, the REP Debtors would have to cease all activities associated
with obtaining new customers in Texas; if the PUC revoked the REP Certificates, the REP
Debtors would be required to cease all REP activities in Texas. I also understand that revocation
of the REP Debtors REP Certificates would result in a shutdown of their operations, resulting in
the REP Debtors no longer being allowed to provide electricity service to retail customers. Such
decertification would have a material effect on the REP Debtors results of operations, liquidity,
and financial condition.
271. Second, I understand that if the Debtors do not satisfy the Transition Charges and
Delivery Charges, the regulatory framework permits the TDSPs that have issued Transition
Bonds to, among other things, transition the REP Debtors customers to a competitor designated
as the provider of last resort, or to arrange for a lockbox account to collect the Delivery
Charges directly from the REP Debtors customers.
92
I understand that if the REP Debtors are
required to notify customers of the lockbox arrangement, this could result in a negative market
perception of the REP Debtors and lead to additional customer losses.
272. Third, I understand that the REP Debtors failure to satisfy Delivery Charges to
an Unaffiliated TDSP permits the Unaffiliated TDSP to pass along the bad debt to all customers
in its service area. I understand from Debtors counsel that under applicable PUC regulations, if

organization. . . . The commission staff or any affected person may bring a complaint seeking to
amend, suspend, or revoke a REPs certificate. Significant violations include the following: . . . (16)
Failure to timely remit payment for invoiced charges to a transmission and distribution utility pursuant
to the terms of the statewide standardized tariff adopted by the commission.
Tex. Admin. Code 25.107(j)(16).
92
See Tex. Admin. Code 25.214(d)(4), 25.215; AEP Texas Central Company Tariff 4.6.2.1(5); AEP Texas
North Company Tariff 4.6.2.1(5); Centerpoint Energy Houston Electric, LLC Tariff 4.6.2.1(5); Oncor Tariff
4.6.2.1(5); Sharyland Utilities, L.P. Tariff 4.6.2.1(5); Nueces Electric Cooperative, Inc. Tariff 4.6.3.2(5);
Texas-New Mexico Power Company Tariff 4.6.2.1(5).

126

a REP Debtor defaults on the payment of Delivery Charges to an Unaffiliated TDSP, the
Unaffiliated TDSP may treat the resulting bad debt as a regulatory asset.
93
Unaffiliated TDSP may make a case before the PUC to increase the tariff rates that the PUC
allows it to charge for Delivery Services to all REPs and other customers with which the TDSP
does business. I understand that this mechanism effectively allows the Unaffiliated TDSPs to
pass on and recoup unpaid Delivery Charges from all REPs, irrespective of whether the
particular REP is current on Delivery Charge payments. I understand that these regulations are
designed, in part, to ensure that Unaffiliated TDSPs are able to cover their operating costs and
capital expenditures. Ultimately, I understand that the unpaid Delivery Charges owed by any
REP could be passed on to customers in the form of higher rates. I also understand that the mere
possibility of increased rates and overcharging of some customers could irreparably damage the
REP Debtors brand and goodwill with customers in the ERCOT region.
273. Fourth, under applicable PUC regulations, I understand from counsel of the
Debtors that failure to timely pay the Delivery Charges could result in the assessment of a late
penalty equal to 5% of each delinquent balance, which could approximate $160,000 per day.
94
I

93
Specifically, the Texas Administrative Code provides as follows:
A [TDSP] shall create a regulatory asset for bad debt expenses, net of collateral posted pursuant to
subparagraph (A) of this paragraph and bad debt already included in its rates, resulting from a REPs
default on its obligation to pay delivery charges to the [TDSP]. Upon a review of reasonableness and
necessity, a reasonable level of amortization of such regulatory asset shall be included as a recoverable
cost in the [TDSP]s rates in its next rate case or such other rate recovery proceeding as deemed
necessary.
16 Tex. Admin. Code 25.107(f)(3)(B). I understand from Debtors counsel that these provisions do not apply
to Oncor pursuant to an order of the PUC under section 14.101 of the Public Utility Regulatory Act allowing the
merger of Oncor with the Debtors. Specifically, under that order, Oncor may not, among other things, seek to
recover from its customers any costs incurred as a result of a bankruptcy of [the Debtors]. Accordingly, I
understand from Debtors counsel that it is unlikely that Oncor would be permitted to make a case before the
PUC to increase tariff rates on the basis of the REP Debtors non-payment of Delivery Charges to Oncor.
94
Standard Tariff for Retail Delivery Service 4.4.6. See Tex. Admin. Code 25.214.

127

understand that upon assumption of the Delivery Agreements, the Debtors would be required to
satisfy such late penalties under section 365(b)(1) of the Bankruptcy Code.
274. Fifth, I understand from Debtors counsel that under applicable PUC regulations
and the Tariffs, if a REP has defaulted in respect of Delivery Charges within a 24-month period,
such REP is required to provide a deposit as security equal to one-sixth of the estimated annual
amount billed to the REP under the Tariff, which security could remain outstanding for a
minimum of two years.
95
I understand that with respect to Oncor alone, a two-month security
deposit for Delivery Charges could amount to approximately $153 million. Similarly, I
understand that if a REP defaults with respect to Transition Charges, the REP is required to
provide a deposit or issue letters of credit equal to two months maximum expected Transition
Charges.
96
I understand that if the REP Debtors default with respect to all Unpaid Transition
Charges, the applicable Transition Bond indenture trustee may seek recourse against the
Transition Charge Security and the Debtors may be required to provide replacement security in
the form of new letters of credit, deposits, or other collateral. I understand that the Debtors
estimate that a replacement two-month security deposit with respect to Transition Charges could
amount to approximately $18.2 million.

95
Importantly, I understand that the REP Debtors are not currently required to provide Delivery Charge LCs to the
TDSPs because the REP Debtors have not defaulted on Delivery Charge payments within the past 24 months. I
understand that if, however, the REP Debtors were to default on payment of Delivery Charges, they may be
required to issue Delivery Charge LCs to secure future Delivery Charges equal to one-sixth of the estimated
annual amount of Delivery Charges due to the TDSPs. See Tex. Admin. Code 25.214(d)(4); AEP Texas
Central Company Tariff 4.5.2.1; AEP Texas North Company Tariff 4.5.2.1; Centerpoint Energy Houston
Electric, LLC Tariff 4.5.2.1; Oncor Tariff 4.5.2.1; Sharyland Utilities, L.P. Tariff 4.5.2.1; Nueces Electric
Cooperative, Inc. Tariff 4.5.2; Texas-New Mexico Power Company Tariff 4.5.2.1. See also 11 U.S.C. 366
(requiring a debtor to provide adequate assurance of payment to its utility providers).
96
See P.U.C. Subst. R. 25.107, 108 (requiring a defaulting REP to provide a deposit or issue replacement letters of
credit of two months maximum expected Transition Charges).

128

275. Accordingly, I believe payment of the Transition Charges and Delivery Charges
in the ordinary course will help the REP Debtors to avoid potentially serious regulatory
consequences, and will save the REP Debtors significant time and expense.
D. Adequate Assurance.
276. Following the commencement of these chapter 11 cases, I understand that the
REP Debtors will continue to sell retail electricity to their customers, collect Transition Charges
from customers, and incur Delivery Charges. I understand that upon assumption of the Delivery
Agreements, and consistent with their long history of successful dealings with the TDSPs, the
REP Debtors will continue to perform under the Delivery Agreements and pay the Transition
Charges and Delivery Charges to the TDSPs. Indeed, I understand that the REP Debtors
continuing ability to pay the TDSPs is contingent upon the TDSPs continuing to provide
electricity distribution service on an uninterrupted basis.
ERCOT Assumption Motion.
97
XIII.
277. In the ERCOT Assumption Motion, the Debtors entry of an order authorizing, but
not directing, the SFA Debtors (as defined in the ERCOT Assumption Motion) to assume the
SFAs and provide adequate assurance of future performance in relation thereto. I understand
that the SFAs set out the terms and conditions by which ERCOT and the SFA Debtors will
discharge their respective duties and responsibilities under the ERCOT Protocols (as defined in
the SFAs). As such, I understand that executing and being a party to an SFA is a necessary pre-
requisite for, among other things, operating power generation assets in the ERCOT region;
participating in the retail electricity in the ERCOT region; scheduling, buying and selling

97
See Motion of Energy Future Holdings Corp., et al., for Entry of an Order Authorizing Certain of the Debtors
to Assume Standard Form Market Participant Agreements with ERCOT, filed contemporaneously herewith.

129

electricity and ancillary services through the ERCOT region; transacting certain financial
instruments; and transacting in the day-ahead market conducted by ERCOT.
278. Additionally, I understand that to secure the Debtors obligations to ERCOT,
Citibank, N.A. issued that certain irrevocable and unconditional standby letter of credit No.
63664972 for the benefit of ERCOT, dated December 4, 2009, which is currently in the amount
of $120 million (as amended, the Letter of Credit) in accordance with ERCOTs
creditworthiness protocols that ERCOT may draw upon in its discretion. I understand that the
Debtors do not believe that the Letter of Credit constitutes property of the Debtors estate such
that ERCOT requires Court authority to draw upon the Letter of Credit.
98
Nevertheless, I believe
in an abundance of caution, the Debtors are seeking authority in the ERCOT Assumption Motion
to allow ERCOT to draw on the Letter of Credit in its discretion. I believe that the availability of
the Letter of Credit (regardless of whether ERCOT chooses to draw on the Letter of Credit)
constitutes adequate assurance of the Debtors future performance under the SFAs. Furthermore,
I understand that it is the Debtors intentions to honor their respective obligations under the
SFAs prior to the entry of the Order.
A. ERCOT.
279. ERCOT manages the flow of electric power to 24 million Texas customers,
representing 85% of the states electric load. I understand that ERCOT schedules electricity on
an electric grid that connects 40,500 miles of transmission lines and more than 550 generation
units. I understand that ERCOT also performs financial settlements for the competitive

98
See, e.g., In re Kaiser Grp. Intl Inc., 399 F.3d 558 (3d. Cir. 2005) (citing the well-established rule that a
letter of credit and the proceeds therefrom are not property of the debtors estate); In re Hechinger Investment
Co. of Delaware, Inc., 282 B.R. 149, 161 (D. Del. 2002) (finding that debtor could not provide any facts in
support of its claim that a letter of credit constituted property of the estate); S-Tran Holdings, Inc.,
No. 05-11391 (KJC) (Bankr. D. Del. 2009) (recognizing that letters of credit do not constitute property of the
debtors estate); In re Sabratek Corp., 257 B.R. 732, 735 (Bankr. D. Del. 2000) (finding that debtors would be
unlikely to succeed in establishing that a letter of credit constituted property of the estate).

130

wholesale power market, administers retail switching for 6.7 million premises in competitive
choice areas, and enforces certain credit requirements, including collateral posting requirements,
to ensure that the activity facilitated by ERCOT does not create credit risks in the market.
280. Additionally, I understand that ERCOT provides a platform for its members to
participate in various aspects of the Texas electricity market. These include:
(a) Real-Time Energy Market. The real-time energy market that allows a party to be paid or
charged for physical electricity and ancillary services provided to or taken from the wholesale
market;

(b) Congestion Revenue Rights Auctions. Auctions for the purchase and sale of congestion
revenue rights (which allow a party to hedge against transmission congestion costs in the day-
ahead market);

(c) Day-Ahead Transactions. Financial transactions (that allow participants to buy and sell
electricity, ancillary services and congestion revenue rights to facilitate hedging price
differences between the day-ahead market and the real-time market); and
(d) Point-to-Point Transactions. Point-to-point transactions (which allow a party to hedge
against transmission congestion in ERCOTs real-time energy market between two specific
locations on the transmission system) (collectively, the ERCOT Participation Rights).
281. I understand that ERCOT is a membership-based 501(c)(4) nonprofit corporation.
I also understand that ERCOTs membership reflects all facets of the power business, including
consumers, electric cooperatives, power generators, power marketers, retail electric providers,
investor-owned electric utilities (transmission and distribution providers), and municipal-owned
electric utilities. I understand that only upon execution of an SFA may an entity enjoy the
ERCOT Participation Rights.
B. The Debtors Participation in ERCOT.
282. I believe the Debtors electricity generating, wholesale trading operations, and
retail operations are substantial and rely on ERCOT. To that end, I understand that certain of the
Debtors have executed SFAs with ERCOT. Specifically, I understand that the following Debtors
are party to one or more SFAs: 4Change Energy Company; Big Brown Power Company LLC;
Luminant Energy Company LLC; Luminant ET Services Company (Luminant ET) ; Luminant
Generation Company LLC; Oak Grove Management Company LLC; Sandow Power Company

131

LLC; Tradinghouse Power Company LP; TXU Energy Retail Company LLC d/b/a TXU Energy
(TXU Energy LLC); and Valley NG Power Company LLC (collectively, the SFA Debtors).
283. I understand that Luminant is the largest electricity generator in Texas and
accounts for approximately 18% of the installed generation capacity for the ERCOT region. I
understand that to facilitate Luminants sale of electricity produced by its power generation
assets, one of its subsidiaries, Luminant Energy Company LLC (Luminant Energy) executed
an SFA permitting Luminant Energy to participate in the ERCOT region as an entity that may
buy and sell energy and ancillary services for wholesale customers. Additionally, I understand
that one of Luminants subsidiaries, Luminant ET, executed an SFA permitting it to participate
in the ERCOT region as an entity that may sell electricity to end-use customers.
284. From consulting my advisors, I understand the Debtors retail operations also rely
on ERCOT. TXU Energy LLC conducts the Debtors primary retail electricity operations, has
approximately 1.7 million residential and business customers, and accounts for approximately
26% of the residential and approximately 19% of the business retail electricity market in the
ERCOT region. To sell electricity to these customers, I understand that its executed an SFA
permitting it to participate in the ERCOT region as an entity that may sell electricity to end-use
customers or wholesale customers therein. I understand that in order for TXU Energy LLC to
continue to sell electricity to TXU Energy LLCs customers and for Luminant Energy to
continue to sell electricity generated by Luminant, both of these subsidiaries must continue to be
party to an SFA.
285. I understand that the Debtors also depend on continued participation in the
electricity market in which ERCOT facilitates operational activities. I understand that ERCOT
provides the SFA Debtors with particular channels to sell and procure power, ancillary services,

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and congestion revenue rights to mitigate the Debtors risks associated with the power generation
assets and retail electricity businesses, and are core to the commercial operations of those
businesses. I understand that ability to participate in the ERCOT region is critical to the daily
cash flows of the Debtors. Moreover, I understand that the SFA Debtors consummate
transactions with ERCOT that they cannot execute with any other party or entity in light of
ERCOTs (a) central role in the Texas electricity system, (b) multi-dimensional investment
platform, and (c) facilitation of real-time and day-ahead market transactions, congestion revenue
right auctions, as well as electricity and ancillary services services, sales, and purchases.
99

286. I understand that these channels are important to the Debtors as a whole, given
that, as of December 31, 2013, the Debtors annual underlying, notional value across all their
operations, based on energy prices for commodities sold and purchased in its operations,
including natural gas, power, coal, fuel-oil, uranium, renewable energy credits and emission
allowances, is approximately $3.8 billion.
287. I understand that the Debtors participate in certain hedging and trading activities
and arrangements to hedge against price fluctuations and thereby protect the economic value of
their operations by preventing substantial declines in cash flows. As an example, during the
fiscal years 2009 through 2013, I understand that the Debtors hedging and trading activities
provided a positive incremental return to the Debtors underlying operations ranging from

99
For additional information regarding the Debtors hedging and trading counterparties, hedging and trading
activity in ERCOT, and the financial significance of these activities to the Debtors businesses, see Motion of
Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders Authorizing the Debtors to (A)
Continue Performance Under Prepetition Hedging and Trading Arrangements, (B) Pledge Collateral and
Honor Obligations Thereunder, and (C) Enter Into and Perform Under Trading Continuation Agreements and
New Postpetition Hedging and Trading Arrangements (the Hedging and Trading Motion). In the Hedging
and Trading Motion, the Debtors have requested that, to the extent necessary, the automatic stay provided in
section 362 of the Bankruptcy Code is modified to permit ERCOT to continue performing its obligations and
exercising its rights under the SFAs and ERCOT protocols. The relief requested in the ERCOT Assumption
Motion is intended to further complement the Debtors requested relief in the Hedging and Trading Motion to
ensure the Debtors continued access to ERCOT on a postpetition basis

133

approximately $240 million to $425 million on an annual basis. I understand that without access
to ERCOTs operational platforms that play a critical role in optimizing economic value and cash
flows, including settling physical energy delivery and certain financial transactions, the Debtors
would face a significant hurdle in executing certain of their hedging and trading activities in a
timely manner.
C. Parties Financial Obligations
288. Following the commencement of these chapter 11 cases, I understand that
ERCOT may, in its discretion, draw upon the Letter of Credit to pay the approximately $10
million in prepetition obligations owed to ERCOT in connection with the SFAs.
289. I understand that the TCEH Debtors also have sought authority to use cash
collateral and to enter into a $4.475 billion debtor-in-possession financing facility (the TCEH
DIP Facility)
100
, both of which will be used in part to fund future payments to ERCOT and
provide a replacement or an additional letter(s) of credit for the benefit of ERCOT as may be
required by the ERCOT protocols. I understand that these avenues of recourse, coupled with the
availability of the Letter of Credit and the ability to provide ERCOT with a replacement or an
additional letter(s) of credit for satisfaction of any of the Debtors postpetition obligations to
ERCOT, provide adequate assurance of the SFA Debtors future performance under the SFAs.

100
I understand that the Debtors seek authority to use cash collateral pursuant to the Motion of Texas Competitive
Electric Holdings Company LLC, and certain of Its Debtor Affiliates for Entry of Interim and Final Orders (A)
Authorizing Use of Cash Collateral, (B) Granting Adequate Protection, (C) Modifying the Automatic Stay, and
(D) Scheduling a Final Hearing and as defined in such motion.
A more detailed description of the TCEH DIP Facility may be found in the Motion of Texas Competitive
Electric Holdings Company LLC and Certain of its Debtor Affiliates, for Entry of Interim and Final Orders (A)
Approving Postpetition Financing, (B) Granting Liens and Providing Superpriority Administrative Expense
Claims, (C) Modifying the Automatic Stay, and (D) Scheduling a Final Hearing.

134

Procedural Motions
Joint Administration Motion.
101
XIV.
290. In the Joint Administration Motion, the Debtors request entry of an order
directing joint administration of these chapter 11 cases for procedural purposes only pursuant to
Bankruptcy Rule 1015(b). Specifically, I understand that the Debtors request that the Court
maintain one file and one docket for all of these chapter 11 cases under the case of lead Debtor
Energy Future Holdings Corp. Further, the Debtors request that an entry be made on the docket
of each of the cases of the Debtors other than Energy Future Holdings Corp. to indicate the joint
administration of these chapter 11 cases.
291. I understand that the 71 Debtors in these chapter 11 cases are affiliates as that
term is defined in section 101(2) of the Bankruptcy Code. As discussed in the First Day
Declaration, the Debtors have highly integrated operations. As such, I believe the joint
administration of these chapter 11 cases will provide significant administrative convenience
without harming the substantive rights of any party in interest. I understand that many of the
motions, hearings, and orders that will arise in these chapter 11 cases will affect each and every
Debtor. In addition, I believe joint administration will reduce fees and costs by avoiding
duplicative filings and objections. I understand that joint administration also will allow the
Office of the United States Trustee for the District of Delaware and all parties in interest to
monitor these chapter 11 cases with greater ease and efficiency.
292. I believe joint administration will not adversely affect the Debtors respective
constituencies because the Joint Administration Motion requests only administrative, not
substantive, consolidation of the estates. I understand that parties in interest will not be harmed

101
See Motion of Energy Future Holdings Corp., et al., for Entry of an Order Directing Joint Administration of the
Debtors Chapter 11 Cases, filed contemporaneously herewith.

135

by the relief requested, but, instead, will benefit from the cost reductions associated with the joint
administration of these chapter 11 cases. Accordingly, I believe that joint administration of these
chapter 11 cases is in the best interests of their estates, their creditors, and all other parties in
interest.
Claims and Noticing Agent Motion.
102
XV.
293. In the Claims and Noticing Agent Motion, the Debtors seek to retain Epiq
Bankruptcy Solutions, LLC (Epiq) as their claims and noticing agent. I believe that by
retaining Epiq in these chapter 11 cases, the Debtors estates, and particularly their creditors, will
benefit from Epiqs service. Since its inception in 1988, I understand that Epiq has provided
claims and noticing services in numerous large cases in this district. Consequently, I understand
that Epiq has developed efficient and cost-effective methods in its area of expertise. I also
understand that Epiq is fully equipped to handle the volume of mailing involved in properly
sending the required notices to creditors and other interested parties in the chapter 11 cases and,
therefore, I believe that the Claims and Noticing Agent Motion should be approved.
Consolidated Creditors List Motion.
103
XVI.
294. In the Consolidated Creditors List Motion, the Debtors seek entry of an Order
authorizing the Debtors to file a consolidated list of creditors in lieu of separate mailing matrix
for each Debtor during the Interim Period and the latter of: (a) 90 days thereafter; or (b) until the
SoFAs have been filed. I believe that with the assistance of Epiq as claims and noticing agent,
the Debtors will be prepared to file a computer-readable consolidated list of creditors and a list of

102
See Application of Energy Future Holdings Corp., et al., for Entry of an Order Approving the Retention and
Appointment of Epiq Bankruptcy Solutions, LLC as the Claims and Noticing Agent for the Debtors, filed
103
See Motion of Energy Future Holdings Corp., et al., for Entry of an Order Authorizing the Debtors to File a
Consolidated List of Creditors in Lieu of Submitting a Separate Mailing Matrix for Each Debtor, filed

136

equity security holders upon request and will be capable of undertaking all necessary mailings.
Indeed, I understand that because the Debtors have thousands of creditors, converting the
Debtors computerized information to a format compatible with the matrix requirements would
be an exceptionally burdensome task and would greatly increase the risk and recurrence of error
with respect to information already intact on computer systems maintained by the Debtors or
their agents.
295. I believe that consolidation of the Debtors computer records into a creditor
database and mailing notices to all applicable parties in such database will be sufficient to permit
Epiq to promptly notice those parties. Accordingly, I believe maintaining electronic-format lists
of creditors and equity security holders rather than preparing and filing separate matrices will
maximize efficiency and accuracy, and reduce costs.
Retention Applications
104
XVII.
296. In the various retention applications, the Debtors will seek authorization to
employ and retain counsel and professionals nunc pro tunc in accordance with their engagement
letters. These professionals include, among others, financial advisors, energy consultants,
compensation consultants, lead restructuring counsel, restructuring advisors, accounting firms,
and various special counsel. The Debtors operations are vast and complex, and I believe the
retention of professionals is necessary for an efficient and effective transition into chapter 11 and
a successful reorganization. Accordingly, I believe the retention applications should be granted.

104
Retention Applications pursuant to 11 U.S.C. 327(e) and 1107: Alvarez & Marsal LLC; Deloitte & Touche
LLP; Epiq Bankruptcy Solutions, LLC; Ernst & Young LLP; Evercore Partners, Inc.; Filsinger Energy Partners,
Inc.; Kirkland & Ellis LLP; PricewaterhouseCoopers LLP; KPMG LLP; Richards, Layton, & Finger, P.A.;
Towers Watson & Co.

Exhibit B
List of the Debtors

TCEH Debtors

Texas Competitive Electric Holdings Company LLC
4Change Energy Company
4Change Energy Holdings LLC
Big Brown 3 Power Company LLC
Big Brown Lignite Company LLC
Big Brown Power Company LLC
Collin Power Company LLC
DeCordova Power Company LLC
DeCordova II Power Company LLC
Eagle Mountain Power Company LLC
Energy Future Competitive Holdings Company LLC
Generation MT Company LLC
Generation SVC Company
Lake Creek 3 Power Company LLC
Luminant Big Brown Mining Company LLC
Luminant Energy Company LLC
Luminant Energy Trading California Company
Luminant ET Services Company
Luminant Generation Company LLC
Luminant Holding Company LLC
Luminant Mineral Development Company LLC
Luminant Mining Company LLC
Luminant Renewables Company LLC
Martin Lake 4 Power Company LLC
Monticello 4 Power Company LLC
Morgan Creek 7 Power Company LLC
NCA Resources Development Company LLC
Oak Grove Management Company LLC
Oak Grove Mining Company LLC
Oak Grove Power Company LLC
Sandow Power Company LLC
TCEH Finance, Inc.
Tradinghouse 3 & 4 Power Company LLC
Tradinghouse Power Company LLC
TXU Energy Receivables Company LLC
TXU Energy Retail Company LLC
TXU Energy Solutions Company LLC
TXU Retail Services Company
TXU SEM Company
Valley NG Power Company LLC
Valley Power Company LLC

Exhibit 2
- 2 -
Other Debtors

Energy Future Holdings Corp.
Brighten Energy LLC
Brighten Holdings LLC
Dallas Power & Light Company, Inc.
Ebasco Services of Canada Limited
EEC Holdings, Inc.
EECI, Inc.
EFH Australia (No. 2) Holdings Company
EFH CG Holdings Company LP
EFH CG Management Company LLC
EFH Corporate Services Company
EFH Finance (No. 2) Holdings Company
EFH FS Holdings Company
EFH Renewables Company LLC
EFIH Finance Inc.
Energy Future Intermediate Holding Company LLC
Generation Development Company LLC
Lone Star Energy Company, Inc.
Lone Star Pipeline Company, Inc.
LSGT Gas Company LLC
LSGT SACROC, Inc.
NCA Development Company LLC
Southwestern Electric Service Company, Inc.
Texas Electric Service Company, Inc.
Texas Energy Industries Company, Inc.
Texas Power & Light Company, Inc.
Texas Utilities Company, Inc.
Texas Utilities Electric Company, Inc.
TXU Electric Company, Inc.
TXU Receivables Company


Exhibit C
Corporate Structure


Exhibit D
Restructuring Support Agreement

Execution Version

KE 26600124.42
THIS RESTRUCTURING SUPPORT AND LOCK-UP AGREEMENT IS NOT AN OFFER WITH
RESPECT TO ANY SECURITIES OR A SOLICITATION OF ACCEPTANCES OF A
CHAPTER 11 PLAN WITHIN THE MEANING OF SECTION 1125 OF THE BANKRUPTCY
CODE. ANY SUCH OFFER OR SOLICITATION WILL COMPLY WITH ALL APPLICABLE
SECURITIES LAWS AND/OR PROVISIONS OF THE BANKRUPTCY CODE. NOTHING
CONTAINED IN THIS RESTRUCTURING SUPPORT AGREEMENT SHALL BE AN
ADMISSION OF FACT OR LIABILITY OR, UNTIL THE OCCURRENCE OF THE
AGREEMENT EFFECTIVE DATE ON THE TERMS DESCRIBED HEREIN, DEEMED
BINDING ON ANY OF THE PARTIES HERETO.
RESTRUCTURING SUPPORT AND LOCK-UP AGREEMENT
This RESTRUCTURING SUPPORT AND LOCK-UP AGREEMENT (including all
exhibits and schedules attached hereto and in accordance with Section 2, this Agreement) is
made and entered into as of April 29, 2014, by and among the following parties:
i. Energy Future Holdings Corp., a Texas corporation (EFH);
1

ii. Energy Future Intermediate Holding Company LLC (EFIH), a Delaware limited
liability company and a direct, wholly-owned subsidiary of EFH;
iii. EFH Corporate Services Company (EFH Corporate Services), a Delaware
corporation and a direct, wholly-owned subsidiary of EFH;
iv. EFIH Finance Inc. (EFIH Finance,), a Delaware corporation and a direct,
wholly-owned subsidiary of EFIH;
v. Energy Future Competitive Holdings Company LLC (EFCH), a Delaware limited
liability company and a direct, wholly-owned subsidiary of EFH;
vi. Texas Competitive Electric Holdings Company LLC (TCEH), a Delaware limited
liability company and a direct, wholly-owned subsidiary of EFCH;
vii. each of TCEHs direct and indirect subsidiaries listed on the signature pages hereto
(the TCEH Subsidiaries, and together with TCEH and EFCH, the
TCEH Debtors, and, together with each of the foregoing entities identified in sub-
clauses (i) and (vii) a Debtor and, collectively, the Debtors);
viii. Texas Energy Future Holdings Limited Partnership (Texas Holdings), a Texas
limited partnership, which holds approximately 99.26% of the outstanding Interests in
EFH (the EFH Interests);
ix. Texas Energy Future Capital Holdings LLC, a Delaware limited liability company
and the general partner of Texas Holdings (TEF and, together with Texas
Holdings, the Consenting Interest Holders);

1
Capitalized terms used but not otherwise defined herein have the meaning ascribed to such terms in the term
sheet attached hereto as Exhibit A (the Term Sheet), subject to Section 2 hereof.

2

x. the undersigned lenders or investment advisors or managers of discretionary accounts
that hold claims
2
pursuant to the TCEH Credit Agreement against EFCH, TCEH, and
the TCEH Subsidiaries under the TCEH Credit Agreement (such claims, the TCEH
Credit Agreement Claims and, collectively, the Consenting TCEH First Lien
Lenders);
xi. the undersigned holders or investment advisors or managers of discretionary accounts
that hold claims against EFCH, TCEH, and the TCEH Subsidiaries under the TCEH
First Lien Notes issued pursuant to the TCEH First Lien Note Indenture (such claims,
the TCEH First Lien Note Claims and, collectively, the Consenting TCEH
First Lien Noteholders and, together, with the Consenting TCEH First Lien
Lenders, the Consenting TCEH First Lien Creditors);
xii. the undersigned holders or investment advisors or managers of discretionary accounts
that hold claims against EFIH and EFIH Finance under the EFIH First Lien Notes
issued pursuant to the EFIH First Lien Indentures (collectively, the Consenting
EFIH First Lien Noteholders);
xiii. the undersigned holders or investment advisors or managers of discretionary accounts
that hold claims against EFIH and EFIH Finance under the EFIH Second Lien Notes
issued pursuant to the EFIH Second Lien Note Indenture (collectively, the
Consenting EFIH Second Lien Noteholders);
xiv. the undersigned holders or investment advisors or managers of discretionary accounts
that hold claims against EFIH and EFIH Finance under the EFIH Unsecured Notes
issued pursuant to the EFIH Unsecured Note Indentures (collectively, the
Consenting EFIH Unsecured Noteholders);
xv. the undersigned holders or investment advisors or managers of discretionary accounts
that hold claims against EFH, EFIH, and EFCH under the EFH Unsecured Notes
issued pursuant to the EFH Unsecured Indentures, but excluding any EFH Unsecured
Notes held by EFIH (collectively, the Consenting EFH Unsecured Noteholders,
and/or together with the Consenting TCEH First Lien Creditors, the Consenting EFIH
First Lien Noteholders, the Consenting EFIH Second Lien Noteholders, and the
Consenting EFIH Unsecured Noteholders, (in each case, as to their respective
issuance, and to the extent still a party thereto, the Consenting Creditors); and
xvi. each transferee who becomes a Permitted Transferee (as defined below) in
accordance with Section 4.04 of this Agreement (each of the foregoing described in
sub-clauses (i) through (xvi), a Party and, collectively, the Parties). Each
Consenting Interest Holder, each Consenting Creditor, and each Permitted Transferee
(if any) is a Restructuring Support Party and are collectively referred to herein
as the Restructuring Support Parties.

2
As used herein the term claim has the meaning ascribed to such term as set forth in section 101(5) of the
Bankruptcy Code.

3

RECI TALS
WHEREAS, the Debtors and the Restructuring Support Parties have negotiated certain
restructuring and recapitalization transactions with respect to the Debtors capital structure,
including the Debtors respective obligations under each of the following: (i) the TCEH Credit
Agreement; (ii) the TCEH First Lien Notes; (iii) the TCEH First Lien Commodity Hedges (but
without respect to any setoff rights that a counterparty to a TCEH First Lien Commodity Hedge
may have against TCEH); (iv) the TCEH First Lien Interest Rate Swaps (but without respect to
any setoff rights that a counterparty to a TCEH First Interest Rate Swap may have against
TCEH); (v) the EFIH First Lien Notes; (vi) the EFIH Second Lien Notes; (vii) the EFIH
Unsecured Notes; (viii) the EFH Unsecured Notes; and (ix) the claims arising under the
indentures listed on Exhibit B hereto (such claims, the Notes Claims);
WHEREAS, the Debtors intend to commence voluntary reorganization cases (the
Chapter 11 Cases) under chapter 11 of title 11 of the United States Code, 11 U.S.C. 101-
1532 (the Bankruptcy Code), in the United States Bankruptcy Court for the District of
Delaware (such court, or another bankruptcy court of competent jurisdiction with respect to the
subject matter, the Bankruptcy Court) to effect the restructuring through a prenegotiated
chapter 11 plan of reorganization (as may be amended or supplemented from time to time in
accordance with the terms of this Agreement, the Plan), all of which shall be on the terms and
conditions described in this Agreement (such transactions, the Restructuring Transactions);
WHEREAS, those Restructuring Support Parties that are party to the commitment letter
attached hereto as Exhibit C (collectively, the Commitment Parties
3
and such letter
(including the exhibits thereto), the Commitment Letter) have agreed in accordance with the
terms and conditions specified in the Commitment Letter to fund the EFIH Second Lien DIP
Financing in an amount of up to $2 billion (the Investment Commitment); and
WHEREAS, the Debtors and the Consenting Interest Holders, as the direct or indirect
owners of EFH, EFIH, EFIH Finance, EFCH, TCEH, and the TCEH Subsidiaries, have agreed to
take certain actions in support of the Restructuring Transactions on the terms and conditions set
forth in this Agreement, the Commitment Letter, and the Term Sheet.
NOW, THEREFORE, in consideration of the covenants and agreements contained
herein, and for other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Party, intending to be legally bound hereby, agrees as follows:
AGREEMENT
Section 1. Agreement Effective Date. This Agreement shall become effective and binding
upon each of the Parties at 12:00 a.m., prevailing Eastern Time, on the date on which: (a)(i) the
Debtors shall have executed and delivered counterpart signature pages of this Agreement to
counsel to the Consenting Interest Holders and counsel to the Consenting Creditors; (ii) holders
of at least 40% of the aggregate outstanding principal amount of the TCEH Credit Agreement

3
For the avoidance of doubt, as used herein, the terms Consenting Creditors and Restructuring Support
Parties include the Commitment Parties in their capacities as such.

4

Claims and the TCEH First Lien Note Claims (determined without regard to any claims held by a
person or entity that is an insider as that term is defined in section 101(31) of the Bankruptcy
Code) shall have executed and delivered to the Debtors counterpart signature pages of this
Agreement; (iii) holders of at least 70% of the outstanding principal amount of each of the EFIH
Unsecured Note Claims and the EFH Unsecured Note Claims (in each case determined without
regard to any claims held by a person or entity that is an insider as that term is defined in
section 101(31) of the Bankruptcy Code) shall have executed and delivered to the Debtors
counterpart signature pages of this Agreement; (iv) holders of at least 10% of the outstanding
principal amount of the EFIH First Lien Note Claims (determined without regard to any claims
held by a person or entity that is an insider as that term is defined in section 101(31) of the
Bankruptcy Code) held by Fidelity shall have executed and delivered to the Debtors counterpart
signature pages of this Agreement (the Consenting Fidelity EFIH First Lien Noteholders);
(v) holders of at least 19% of the outstanding principal amount of the EFIH First Lien Note
Claims (determined without regard to any claims held by a person or entity that is an insider as
that term is defined in section 101(31) of the Bankruptcy Code) held by holders other than
Fidelity shall have executed and delivered to the Debtors counterpart signature pages of this
Agreement (the Consenting Non-Fidelity EFIH First Lien Noteholders); (vi) holders of at
least 25% of the outstanding principal amount of the EFIH Second Lien Note Claims
(determined without regard to any claims held by a person or entity that is an insider as that
term is defined in section 101(31) of the Bankruptcy Code) held by Fidelity shall have executed
and delivered to the Debtors counterpart signature pages of this Agreement; and (vii) each of the
Consenting Interest Holders shall have executed and delivered to the Debtors counterpart
signatures of this Agreement; (b) each of the Commitment Parties shall have executed and
delivered to the Debtors counterpart signatures to the Commitment Letter; (c) EFH and EFIH
shall have paid the Execution Fee (as defined in the Commitment Letter); (d) the Debtors shall
have paid all reasonable and documented fees and expenses incurred through the Agreement
Effective Date (as defined below) for the professionals identified in Section 10 in the amounts
set forth in Schedule 1 attached hereto (including the request to increase or replenish the
retainers as set forth on Schedule 1); and (e) the Debtors have given notice to counsel to the
Consenting Interest Holders and counsel to the Consenting Creditors in accordance with
Section 11.11 hereof that each of the foregoing conditions set forth in this Section 1, in each
case, has been satisfied and this Agreement is effective; in each instance, on or before April 29,
2014 (such date, the Agreement Effective Date).
4

Section 2. Exhibits I ncorporated by Reference. Each of the exhibits attached hereto is
expressly incorporated herein and made a part of this Agreement, and all references to this
Agreement shall include the exhibits. In the event of any inconsistency between this Agreement
(without reference to the exhibits) and the exhibits, this Agreement (without reference to the
exhibits) shall govern.
Section 3. Definitive Documentation. The definitive documents and agreements governing
the Restructuring Transactions (collectively, the Plan Restructuring Documents) shall

4
For the avoidance of doubt, the obligations and rights of the Consenting Creditors described in this Agreement
shall apply to any postpetition claims acquired by such Consenting Creditors in accordance with the
Restructuring Transactions.

5

consist of: (a) the motion to assume this Agreement pursuant to sections 105(a) and 365 of the
Bankruptcy Code and the performance by the Debtors of their obligations hereunder (the RSA
Assumption Motion) and the order approving the RSA Assumption Motion (the RSA
Assumption Order); (b) the Plan (and all exhibits thereto); (c) the Confirmation Order and
pleadings in support of entry of the Confirmation Order; (d) the Disclosure Statement, the other
solicitation materials in respect of the Plan (such materials, collectively, the Solicitation
Materials), the motion to approve the Disclosure Statement, and the order entered by the
Bankruptcy Court approving the Disclosure Statement and Solicitation Materials as containing,
among other things, adequate information as required by section 1125 of the Bankruptcy Code
(the Disclosure Statement Order); (e) the documentation in respect of the EFIH First Lien
DIP Financing (including related motions and orders); (f) the documentation in respect of the
EFIH Second Lien DIP Financing (including related motions and orders); (g) the Oncor TSA
Amendment; (h) the IRS Submissions and the Private Letter Ruling, (i) the Conversion
Agreement (as defined in the Commitment Letter) (including any related order); (j) the motion
(the Approval Motion) and related orders to obtain entry of (i) an order (the Approval
Order) authorizing, among other things, (A) the EFIH First Lien Settlement, (B) the EFIH
Second Lien Settlement; and (C) EFH and EFIH to perform their obligations under the
Commitment Letter, including the payment of professionals fees on the terms set forth in the
Commitment Letter and (ii) an order (the Oncor TSA Amendment Order) authorizing the
Oncor TSA Amendment, all in a manner consistent with the terms of this Agreement; (k) the
documentation in respect of the EFIH First Lien Settlement (including the related order); (l) the
documentation in respect of the EFIH Second Lien Settlement (including the related order);
(m) any pleadings or orders related to the EFIH First Lien Makewhole Claim and/or EFIH
Second Lien Makewhole Claim (collectively, the Make-Whole Pleadings); (n) all other
documents that will comprise the Plan Supplement; and (o) a motion seeking entry of an order
and the resulting order restricting transfers of claims against the Debtors to the extent such
transfers would adversely affect the Debtors ability to obtain any required regulatory consents
(the Trading Motion). The Plan Restructuring Documents remain subject to negotiation and
completion and shall, upon completion, contain terms, conditions, representations, warranties,
and covenants consistent with the terms of this Agreement, and shall otherwise be in form and
substance reasonably acceptable to each of (i) the Debtors, (ii) the Consenting Interest Holders,
and (iii) the Required Consenting Creditors; provided, however, that, only EFH, EFIH, the
Consenting Fidelity EFIH First Lien Noteholders, the Consenting EFIH Second Lien
Noteholders, the Consenting EFH Unsecured Noteholders, and the Required EFIH Unsecured
Consenting Creditors, and no other Restructuring Support Party, shall have the foregoing rights
described in this Section 3 over those documents pertaining exclusively to the Restructuring
Transactions and Chapter 11 Cases of EFH and EFIH; provided, further, that the Approval
Order, the Oncor TSA Amendment Order, and the Make-Whole Pleadings shall be in form and
substance reasonably satisfactory to EFH, EFIH, the Consenting Fidelity EFIH First Lien
Noteholders, the Consenting EFH Unsecured Noteholders, and the Required EFIH Unsecured
Consenting Creditors only (and no other Restructuring Support Party shall have the foregoing
rights) provided, further, the new EFH/EFIH debt and equity documents (including the
Conversion Agreement) and the EFH and EFIH corporate governance documents (including the
selection of the board of directors and officers of such entities) shall be in form and substance
satisfactory to the Required EFIH Unsecured Consenting Creditors only, in each case, subject to
the terms and conditions specified in the Term Sheet, and the Required EFIH Unsecured

6

Consenting Creditors shall reasonably consult with the Consenting EFH Creditors in connection
with the EFH and EFIH corporate governance documents; provided, further, that only TCEH and
the Consenting TCEH First Lien Creditors, and no other Restructuring Support Party, shall have
consent rights over those documents pertaining exclusively to the Restructuring Transactions and
Chapter 11 cases of the TCEH Debtors. Additionally, each Consenting Non-Fidelity EFIH First
Lien Noteholder shall have reasonable consent rights over all definitive documentation (and
orders) in respect of the terms and conditions not otherwise addressed in the Term Sheet
regarding each of the EFIH First Lien DIP Financing (and related orders), the Approval Motion,
the Approval Order, the RSA Assumption Motion, and the RSA Assumption Order. As used
herein, the term Required Consenting Creditors means, at any relevant time: (a) at least
three (3) members of the Ad Hoc TCEH Committee who collectively hold at least 50.1%

of the
TCEH First Lien Claims held by the members of the Ad Hoc TCEH Committee (the
Consenting Ad Hoc TCEH Committee); (b) Consenting Creditors holding at least 50.1% of
the EFIH First Lien Note Claims held by all Consenting Creditors; (c) Consenting Creditors
holding at least 50.1% of the EFIH Second Lien Note Claims held by all Consenting Creditors;
(d) Consenting Creditors holding at least 50.1% of the EFH Unsecured Note Claims held by all
Consenting Creditors; and (e) at least three (3) investment advisors that manage and/or advise
funds or accounts that beneficially own, collectively, at least 66.67% of the EFIH Unsecured
Note Claims held by all Consenting Creditors (the Required EFIH Unsecured Consenting
Creditors).
Section 4. Commitments Regarding the Restructuring Transactions.
4.01. Commitment of the Consenting Creditors.
(a) During the period beginning on the Agreement Effective Date and ending on a
Termination Date (as defined in Section 8.11) (such period, the Effective Period):
(i) each of the Consenting Creditors that is entitled to accept or reject the Plan
pursuant to its terms agrees that it shall, subject to the receipt by such Consenting Creditor of the
Disclosure Statement and the Solicitation Materials, in each case, approved by the Bankruptcy
Court as containing adequate information as such term is defined in section 1125 of the
Bankruptcy Code:
(A) to the extent a class of claims is permitted to vote to accept or
reject the Plan, vote each of its claims (including each of its TCEH First Lien Claims, EFIH
Unsecured Note Claims, EFH Unsecured Note Claims, EFIH First Lien Note Claims, EFIH
Second Lien Note Claims, the Notes Claims, the TCEH DIP Claims, the EFIH First Lien DIP
Claims, the EFIH Second Lien DIP Claims, and any other claims against the applicable Debtor)
(such Claims, together with the EFH Interests, the Texas Holdings Interests, and the TEF
Interests, collectively, the Debtor Claims/Interests) to accept the Plan by delivering its duly
executed and completed ballot(s) accepting the Plan on a timely basis following the
commencement of the solicitation and its actual receipt of the Solicitation Materials and ballot;
and
(B) not change or withdraw (or cause to be changed or withdrawn)
such vote;

7

(ii) each Consenting Creditor further agrees that it shall not directly or
indirectly (A) object to, delay, impede, or take any other action to interfere with the acceptance,
implementation, or consummation of the Restructuring Transactions, (B) propose, file, support,
or vote for any restructuring, workout, plan of arrangement, or plan of reorganization for the
Debtors other than the Restructuring Transactions, or (C) direct the Agents
5
(as applicable) to
take any action contemplated in (A) and (B) of this Section 4.01(a)(ii); provided, however, that
to the extent a Consenting Creditor directs the Agents (as applicable) not to take an action
contemplated in (A) and (B) of this Section 4.01(a)(ii), such direction shall not be construed in
any way as requiring any Consenting Creditor to provide an indemnity to the applicable Agent,
or to incur or potentially incur any other liability, in connection with such direction; and
(iii) upon the commencement by the Debtors of the Chapter 11 Cases, and
subject to Section 8.12, the automatic stay is invoked and each Consenting Creditor agrees that,
except to the extent expressly contemplated under the Plan and this Agreement, it will not, and
will not direct the Agents (as applicable) to, exercise any right or remedy for the enforcement,
collection, or recovery of any of the Debtor Claims/Interests, and any other claims against any
direct or indirect subsidiaries of the Debtors that are not Debtors; provided, however, that to the
extent a Consenting Creditor directs the Agents (as applicable) to not take any action
contemplated in the foregoing provision, such direction shall not be construed in any way as
requiring any Consenting Creditor to provide an indemnity to the applicable Agent, or to incur or
potentially incur any other liability, in connection with such direction; provided, further,
however, that for the avoidance of doubt, upon (A) the termination of this Agreement or
(B) termination of the automatic stay as to property or interests in property which secure any
such claims upon motion by a person or entity other than a Consenting Creditor, each Consenting

5
For purposes of the Agreement, the term Agent means any of the following (and each of their respective
successors and assigns): (a) Citibank, N.A., in its capacity as: (i) administrative agent under the TCEH Credit
Agreement; (ii) administrative and collateral agent with respect to certain TCEH First Lien Claims pursuant to
the Amended and Restated Collateral Agency and Intercreditor Agreement, dated as of August 7, 2009 (as may
be amended, restated, or supplemented); and (iii) senior collateral agent and representative with respect to
certain TCEH First and Second Lien Claims pursuant to the Second Lien Intercreditor Agreement, dated as of
October 6, 2010 (as may be amended, restated, or supplemented, the TCEH Second Lien Intercreditor
Agreement); (b) The Bank of New York Mellon Trust Company, N.A., in its capacity as: (i) collateral trustee
with respect to certain EFIH Second Lien Notes Claims pursuant to the Collateral Trust Agreement (as may be
amended, restated or supplemented); (ii) indenture trustee with respect to certain EFIH Senior Toggle Note
Claims pursuant to the EFIH Senior Toggle Note Indenture; (iii) indenture trustee with respect to certain EFIH
Unexchanged Note Claims pursuant to the EFIH Unexchanged Note Indenture; (iv) indenture trustee with
respect to certain TCEH First Lien Note Claims pursuant to the TCEH First Lien Note Indenture; (v) EFH
Notes Trustee; (vi) EFH LBO Notes Trustee; (vii) indenture trustee with respect to certain EFIH Second Lien
Note Claims; and (viii) initial second priority representative under the TCEH Second Lien Intercreditor
Agreement; (c) CSC Trust Company of Delaware in its capacity as: (i) collateral trustee with respect to certain
EFIH First Lien Note Claims pursuant to the Collateral Trust Agreement (as may be amended, restated, or
supplemented); (ii) collateral trustee with respect to certain EFIH First Lien Note Claims pursuant to that certain
junior lien pledge agreement, dated as of April 25, 2011 (as may be amended, restated or supplemented); and
(iii) indenture trustee with respect to certain EFIH First Lien Note Claims; (d) Wilmington Savings Fund
Society, FSB, in its capacity as indenture trustee with respect to certain TCEH Second Lien Note Claims; (e)
Law Debenture Trust Company of New York, in its capacity as indenture trustee with respect to certain TCEH
Unsecured Note Claims; and (f) UMB Bank, N.A., in its capacity as: (i) indenture trustee with respect to certain
EFIH Senior Toggle Note Claims pursuant to the EFIH Senior Toggle Note Indenture; and (ii) indenture trustee
with respect to certain EFIH Unexchanged Note Claims pursuant to the EFIH Unexchanged Note Indenture.

8

Creditor may, after notifying counsel to the Debtors in accordance with Section 11.11(a),
exercise such right or remedy.
(b) The foregoing sub-clause (a) of this Section 4 will not limit any of the following
Consenting Creditor rights, to the extent consistent with this Agreement:
(i) to appear and participate as a party in interest in any matter to be
adjudicated in the Chapter 11 Cases, so long as such appearance and the positions advocated in
connection therewith are not inconsistent with this Agreement and do not hinder, delay, or
prevent consummation of the Restructuring Transactions;
(ii) under any applicable credit agreement, indenture, other loan document or
applicable law; or
(iii) to take or direct any action relating to maintenance, protection, or
preservation of any collateral.
(c) (i) It shall not be a violation of this Agreement, and no Restructuring Support
Party will assert that it is an Event of Default under the TCEH Cash Collateral Order, if the Ad
Hoc TCEH Committee or any of its members, within the Challenge Period (as defined in the
TCEH Cash Collateral Order), seeks standing to commence, and if granted standing, assert and
prosecute any Claims, objections or other Causes of Action relating to the validity, allowability,
enforceability, priority, avoidance, or subordination of the TCEH 2012 Incremental Term Loans
or the liens and security interests that secure the TCEH 2012 Incremental Term Loans (other
than against the holders of EFH Interests, the Debtors directors, the Debtors officers, and each
of their respective affiliates), and (ii) if any Consenting Creditor(s) (or the Claims beneficially
held by such Consenting Creditor) or Consenting Interest Holder(s) becomes the subject of any
Cause of Action commenced, or for which court authority is requested to commence, including
in respect of any Cause of Action set forth in clause (i) above, by any other person in connection
with these Chapter 11 Cases or related to the Debtors, then such Consenting Creditors or
Consenting Interest Holder(s) shall be entitled to assert (or seek authority to assert) and prosecute
any and all defenses, counterclaims, cross-complaints, cross-claims, and other claims relating in
any way to such Cause of Action (other than against the holders of EFH Interests, the Debtors
directors, the Debtors officers, and each of their respective affiliates) (such Claims, objections,
or other Causes of Action described in this Section 4.01(c), a Permitted Cause of Action).
4.02. Commitment of the Consenting Interest Holders.
(a) During the Effective Period, each of the Consenting Interest Holders agrees that it
shall not, directly or indirectly, (i) object to, delay, impede, or take any other action to interfere
with acceptance, implementation, or consummation of the Restructuring Transactions or
(ii) propose, file, support, or vote for any restructuring, workout, plan of arrangement, or plan of
reorganization for the Debtors other than the Restructuring Transactions.
(b) Each Consenting Interest Holder agrees to (i) support and take all necessary steps
to effectuate the Restructuring Transactions, including timely providing all requisite consents
and approvals as required in order for the Debtors to file for relief under chapter 11 of the
Bankruptcy Code under that certain Amended and Restated Limited Liability Company

9

Agreement of Texas Energy Future Capital Holdings LLC, dated as of October 10, 2007, by and
among the parties thereto and (ii)(A) to the extent it is entitled to accept or reject the Plan
pursuant to its terms that it shall, subject to the receipt by such Consenting Interest Holder of the
Disclosure Statement and the Solicitation Materials, in each case, approved by the Bankruptcy
Court as containing adequate information as such term is defined in section 1125 of the
Bankruptcy Code, vote to accept the Plan by delivering its duly executed and completed ballot
accepting the Plan on a timely basis following the commencement of the solicitation and its
actual receipt of the Solicitation Materials and ballot, and (B) not change or withdraw (or cause
to be changed or withdrawn) such vote.
(c) The foregoing sub-clause (a) and sub-clause (b) of this Section 4.02 will not limit
any Consenting Interest Holders rights to appear and participate as a party in interest in any
matter to be adjudicated in the Chapter 11 Cases, so long as such appearance and the positions
advocated in connection therewith are not inconsistent with the Restructuring Transactions and
do not hinder, delay, or prevent consummation of the Restructuring Transactions.
4.03. Commitment of the Debtors.
(a) During the Effective Period and thereafter as required pursuant to clause
(viii) below, the Debtors shall: (i) take all steps necessary or desirable to obtain orders of the
Bankruptcy Court in respect of the Restructuring Transactions, including obtaining entry of the
Confirmation Order; (ii) support and take all steps reasonably necessary or desirable to
consummate the Restructuring Transactions in accordance with this Agreement, including the
preparation and filing within the time-frame provided herein of the Plan Restructuring
Documents; (iii) execute and deliver any other required agreements to effectuate and
consummate the Restructuring Transactions; (iv) obtain any and all required regulatory and/or
third-party approvals for the Restructuring Transactions; (v) complete the Restructuring
Transactions within the time-frame provided herein; (vi) operate their business in the ordinary
course, taking into account the Restructuring Transactions; (vii) not object to, delay, impede, or
take any other action that is materially inconsistent with, or is intended or is likely to interfere in
a material way with acceptance or implementation of the Restructuring Transactions; (viii) report
income items to Consenting Creditors in a manner consistent with past practice; and (ix) file the
Trading Motion at a time to be mutually agreed upon by the Debtors and the Required
Consenting Creditors.
(b) The Debtors represent and warrant to the Consenting Creditors and the
Consenting Interest Holders that there are no pending agreements (oral or written) or
understandings, with respect to any plan of reorganization or liquidation, proposal, offer,
dissolution, winding up, liquidation, reorganization, merger, consolidation, business
combination, joint venture, partnership, sale of assets or equity interests or restructuring (other
than the Restructuring Transactions) involving the Debtors, or any of their assets, properties or
businesses (an Alternative Proposal). If the Debtors make or receive a written proposal or
expression of interest regarding an Alternative Proposal, the Debtors shall promptly notify
counsel to the Consenting Creditors and the Consenting Interest Holders of the receipt of any
such proposal or expression of interest relating to an Alternative Proposal, with such notice to
include the material terms thereof, including (unless prohibited by a separate agreement) the
identity of the person or group of persons involved. The Debtors shall promptly furnish counsel

10

to the Consenting Creditors and the Consenting Interest Holders with copies of any written offer
or other information that they make or receive relating to an Alternative Proposal and shall keep
counsel to the Consenting Creditors and the Consenting Interest Holders fully informed of any
material changes to such Alternative Proposal. The Debtors shall not enter into any
confidentiality agreement with a party proposing an Alternative Proposal unless such party
consents to identifying and providing to counsel to the Consenting Creditors and the Consenting
Interest Holders (under a reasonably acceptable confidentiality agreement) the information
contemplated under this Section 4.03(b).
(c) Notwithstanding anything to the contrary herein, nothing in this Agreement shall
require the board of directors, board of managers, or such similar governing body of a Debtor to
take any action, or to refrain from taking any action, with respect to the Restructuring
Transactions to the extent such board of directors, board of managers, or such similar governing
body determines, based on the advice of counsel, that taking such action, or refraining from
taking such action, as applicable, is required to comply with applicable law or its fiduciary
obligations under applicable law.
4.04. Transfer of Interests and Securities.
(a) During the Effective Period, no Consenting Interest Holder or Consenting
Creditor shall sell, use, pledge, assign, transfer, permit the participation in, or otherwise dispose
of (each, a Transfer) any ownership (including any beneficial ownership)
6
in the Debtor
Claims/Interests unless it satisfies all of the following requirements (a transferee that satisfies
such requirements, a Permitted Transferee, and such Transfer, a Permitted Transfer):
(i) the intended transferee executes and delivers to counsel to the Debtors on
the terms set forth below an executed form of the transfer agreement in the form attached hereto
as Exhibit D (a Transfer Agreement) before such Transfer is effective (it being understood
that any Transfer shall not be effective as against the Debtors until notification of such Transfer
and a copy of the executed Transfer Agreement is received by counsel to the Debtors, in each
case, on the terms set forth herein); and
(ii) the intended transferee, the intended transferees affiliates, and/or any
unaffiliated third-party in which the intended transferee has a beneficial ownership, or any group
of persons acting pursuant to a plan or arrangement as described in Treasury Regulation Section
1.355-6(c)(4) (provided, however, that for purposes of this Section 4.04(a)(ii), none of the
Consenting Interest Holders or Consenting Creditors will be treated as acting pursuant to a plan
or arrangement as a result of participating in the Plan and Restructuring Transactions), will not,
after giving effect to such Transfer, (A) have beneficial ownership of, in the aggregate, fifty
percent (50%) or more of TCEH First Lien Claims, EFIH Second Lien DIP Claims, or the Texas
Holdings Interests or TEF Interests or (B) have, assuming the Restructuring Transactions were to
be consummated immediately upon such Transfer, beneficial ownership of, in the aggregate,

6
As used herein, the term beneficial ownership means the direct or indirect economic ownership of, and/or
the power, whether by contract or otherwise, to direct the exercise of the voting rights and the disposition of, the
Debtor Claims/Interests or the right to acquire such Claims or Interests.

11

fifty percent (50%) or more of the Reorganized TCEH Common Stock, the Reorganized EFH
Common Stock, or the Texas Holdings Interests or TEF Interests.
(b) [Reserved.]
(c) Notwithstanding anything to the contrary herein, (i) the foregoing provisions shall
not preclude any Consenting Creditor from settling or delivering securities or bank debt to settle
any confirmed transaction pending as of the date of such Consenting Creditors entry into this
Agreement (subject to compliance with applicable securities laws and it being understood that
such Debtor Claims/Interests so acquired and held (i.e., not as a part of a short transaction) shall
be subject to the terms of this Agreement), and (ii) a Qualified Marketmaker
7
(as defined below)
that acquires any of the Debtor Claims/Interests with the purpose and intent of acting as a
Qualified Marketmaker for such Debtors Claims/Interests, shall not be required to execute and
deliver to counsel a Transfer Agreement or otherwise agree to be bound by the terms and
conditions set forth in this Agreement if such Qualified Marketmaker transfers such Debtor
Claims/Interests (by purchase, sale, assignment, participation, or otherwise) within five (5)
business days of its acquisition to a Consenting Interest Holder, Consenting Creditor, or
Permitted Transferee (including, for the avoidance of doubt, the requirement that such transferee
execute a Transfer Agreement) and the transfer otherwise is a Permitted Transfer.
(d) This Agreement shall in no way be construed to preclude the Consenting Interest
Holders or Consenting Creditors from acquiring additional Debtor Claims/Interests; provided,
however, that (i) any Consenting Interest Holder or Consenting Creditor that acquires additional
Debtor Claims/Interests, as applicable, after the Agreement Effective Date shall promptly notify
the Debtors of such acquisition including the amount of such acquisition and (ii) such acquired
Debtor Claims/Interests shall automatically and immediately upon acquisition by a Consenting
Creditor or Consenting Interest Holder, as applicable, be deemed subject to the terms of this
Agreement (regardless of when or whether notice of such acquisition is given to the Debtors).
(e) This Section 4.04 shall not impose any obligation on any Debtor to issue any
cleansing letter or otherwise publicly disclose information for the purpose of enabling a
Consenting Interest Holder or Consenting Creditor to Transfer any Debtor Claims/Interests.
Notwithstanding anything to the contrary herein, to the extent the Debtors and another Party
have entered into a separate agreement with respect to the issuance of a cleansing letter or
other public disclosure of information in connection with any proposed Restructuring
Transactions (each such executed agreement, a Confidentiality Agreement), the terms of
such Confidentiality Agreement shall continue to apply and remain in full force and effect
according to its terms.

7
As used herein, the term Qualified Marketmaker means an entity that (a) holds itself out to the public or the
applicable private markets as standing ready in the ordinary course of business to purchase from customers and
sell to customers claims of the Debtors (or enter with customers into long and short positions in claims against
the Debtors), in its capacity as a dealer or market maker in claims against the Debtors and (b) is, in fact,
regularly in the business of making a market in claims against issuers or borrowers (including debt securities or
other debt).

12

(f) Notwithstanding anything to the contrary herein: (i) following the funding in full
of the EFIH First Lien DIP Financing, the Transfer of EFIH First Lien DIP Claims shall not be
subject to this Section 4.04, but shall be subject only to the definitive documentation governing
the EFIH First Lien DIP Financing; and (ii) each Consenting Non-Fidelity EFIH First Lien
Noteholder and any funds managed by each Consenting Non-Fidelity EFIH First Lien
Noteholder shall be bound by the transfer restrictions in this Section 4.04 only in respect of their
EFIH First Lien Note Claims.
(g) Any Transfer made in violation of this Sections 4.04 shall be void ab initio. Any
Consenting Interest Holder or Consenting Creditor that effectuates a Permitted Transfer to a
Permitted Transferee shall have no liability under this Agreement arising from or related to the
failure of the Permitted Transferee to comply with the terms of this Agreement.
4.05. Representations and Warranties of Consenting Interest Holders and Consenting
Creditors. Each Consenting Creditor and Consenting Interest Holder, severally, and not jointly,
represents and warrants that:
(a) it is the beneficial owner of the face amount of the Debtor Claims/Interests, or is
the nominee, investment manager, or advisor for beneficial holders of the Debtor
Claims/Interests, as reflected in such Consenting Creditors and/or Consenting Interest Holders
signature block to this Agreement, which amount each Party understands and acknowledges is
proprietary and confidential to such Consenting Creditor and/or Consenting Interest Holder (such
Debtor Claims/Interests, the Owned Debtor Claims/Interests);
(b) other than with respect to a Consenting Non-Fidelity EFIH First Lien Noteholder,
it will not beneficially or legally own, either directly or indirectly through its affiliates (but
excluding any affiliates that are subject to an internal ethical wall or screen), any unaffiliated
third parties in which it may hold a direct or indirect beneficial interest, or as part of any group of
persons acting pursuant to a plan or arrangement as described in Treasury Regulation Section
1.355-6(c)(4), provided, however, that for purposes of this Section 4.04(a)(ii), none of the
Consenting Interest Holders or Consenting Creditors will be treated as acting pursuant to a plan
or arrangement as a result of participating in the Plan and Restructuring Transactions), in the
aggregate, fifty percent (50%) or more of (A) TCEH First Lien Claims, EFIH Second Lien DIP
Claims, or the Texas Holdings Interests or TEF Interests or (B) the Reorganized TCEH Common
Stock, the Reorganized EFH Common Stock, or the Texas Holdings Interests or TEF Interests;
(c) it has the full power and authority to act on behalf of, vote and consent to matters
concerning the Owned Debtor Claims/Interests;
(d) the Owned Debtor Claims/Interests are free and clear of any pledge, lien, security
interest, charge, claim, equity, option, proxy, voting restriction, right of first refusal, or other
limitation on disposition, transfer, or encumbrances of any kind, that would adversely affect in
any way such Consenting Creditors or Consenting Interest Holders ability to perform any of its
obligations under this Agreement at the time such obligations are required to be performed;
(e) (i) it is either (A) a qualified institutional buyer as defined in Rule 144A of the
Securities Act or (B) an institutional accredited investor (as defined in Rule 501(a)(1), (2), (3), or

13

(7) under the Securities Act of 1933, as amended (the Securities Act) (C) a Regulation S non-
U.S. person or (D) the foreign equivalent of (A) or (B) above, and (ii) any securities of any
Debtor acquired by the applicable Consenting Creditor or Consenting Interest Holder in
connection with the Restructuring Transactions will have been acquired for investment and not
with a view to distribution or resale in violation of the Securities Act; and
(f) as of the date hereof, it has no actual knowledge of any event that, due to any
fiduciary or similar duty to any other person or entity, would prevent it from taking any action
required of it under this Agreement.
Section 5. Mutual Representations, Warranties, and Covenants. Each of the Parties
represents, warrants, and covenants to each other Party:
5.01. Enforceability. It is validly existing and in good standing under the laws of the
state of its organization, and this Agreement (and, to the extent applicable, the Commitment
Letter) is a legal, valid, and binding obligation of such Party, enforceable against it in accordance
with its terms, except as enforcement may be limited by applicable laws relating to or limiting
creditors rights generally or by equitable principles relating to enforceability.
5.02. No Consent or Approval. Except as expressly provided in this Agreement, the
Plan, the Term Sheet, the Commitment Letter, or the Bankruptcy Code, no consent or approval is
required by any other person or entity in order for it to effectuate the Restructuring Transactions
contemplated by, and perform the respective obligations under, this Agreement (and, to the
extent applicable, the Commitment Letter).
5.03. Power and Authority. Except as expressly provided in this Agreement, it has all
requisite corporate or other power and authority to enter into, execute, and deliver this
Agreement (and, to the extent applicable, the Commitment Letter) and to effectuate the
Restructuring Transactions contemplated by, and perform its respective obligations under, this
Agreement (and, to the extent applicable, the Commitment Letter).
5.04. Governmental Consents. Except as expressly set forth herein and with respect to
the Debtors performance of this Agreement (and subject to necessary Bankruptcy Court
approval and/or regulatory approvals associated with the Restructuring Transactions), the
execution, delivery and performance by it of this Agreement does not, and shall not, require any
registration or filing with consent or approval of, or notice to, or other action to, with or by, any
federal, state, or other governmental authority or regulatory body.
5.05. No Conflicts. The execution, delivery, and performance of this Agreement does
not and shall not: (a) violate any provision of law, rules or regulations applicable to it or any of
its subsidiaries in any material respect; (b) violate its certificate of incorporation, bylaws, or
other organizational documents or those of any of its subsidiaries; or (c) conflict with, result in a
breach of, or constitute (with due notice or lapse of time or both) a default under any contractual
obligation to which it is a party, which conflict, breach, or default, would have a material adverse
effect on the Restructuring Transactions.
Section 6. Acknowledgement. Notwithstanding any other provision herein, this Agreement
is not and shall not be deemed to be an offer with respect to any securities or solicitation of votes

14

for the acceptance of a plan of reorganization for purposes of sections 1125 and 1126 of the
Bankruptcy Code or otherwise. Any such offer or solicitation will be made only in compliance
with all applicable securities laws and provisions of the Bankruptcy Code. The Debtors will not
solicit acceptances of any Plan from Consenting Creditors or Consenting Interest Holders in any
manner inconsistent with the Bankruptcy Code or applicable bankruptcy law.
Section 7. Certain Additional Chapter 11 Matters.
7.01. The Required Consenting Creditors shall have reviewed, commented on, and
consented to the first-day pleadings identified on Schedule 3 attached hereto (the First Day
Pleadings). Additionally, during the Effective Period, the Debtors will use reasonable efforts to
provide: (i) draft copies of all material motions, pleadings and other documents other than the
First Day Pleadings (including the IRS Submissions) that the Debtors intend to file with any
court or regulatory body (including, the Bankruptcy Court and the IRS) relating to the Chapter
11 Cases or the Restructuring Transactions to counsel to the Consenting Interest Holders and
counsel to the Consenting Creditors at least two (2) business days before the date on which
Debtors intend to file any such document; and (ii) copies of all documents actually filed by the
Debtors with any court or regulatory body (including the Bankruptcy Court and the IRS) relating
to the Chapter 11 Cases or the Restructuring Transactions to counsel to the Consenting Interest
Holders and counsel to the Consenting Creditors promptly but not later than two (2) business
days after such motions, pleadings, and other documents are filed; provided, however, that the
Debtors will provide draft copies of all Plan Restructuring Documents to the Required
Consenting Creditors three (3) business days before the date on which the Debtors intend to file
such documents. To the extent such documents do not constitute Plan Restructuring Documents
(which shall be consistent with Section 3), the Debtors shall consult in good faith with counsel to
the Restructuring Support Parties regarding the form and substance of those documents.
7.02. The Commitment Parties shall coordinate with Oncor Electric Delivery to obtain
any necessary regulatory approvals from the Public Utility Commission of Texas related to the
change in equity ownership at EFH (PUC Regulatory Approval). EFH and EFIH shall
cooperate as reasonably necessary to obtain the PUC Regulatory Approval; provided, however,
that the TCEH Debtors shall not have any obligation to participate in the process to obtain the
PUC Regulatory Approval or agree to any conditions affecting the TCEH Debtors; provided,
further, that EFH, EFIH, and the Commitment Parties agree to use commercially reasonable
efforts to obtain a preliminary order from the PUC limiting the scope of the PUC Regulatory
Approval proceeding to issues related to Oncor and the change in equity ownership at EFH and
excluding consideration of any issues relating to the TCEH Debtors.
Section 8. Termination Events.
8.01. Shared Consenting Creditor Termination Events. This Agreement may be
terminated as between: (a) the Consenting TCEH First Lien Creditors and the other Parties,
(b) the Consenting Fidelity EFIH First Lien Noteholders and the other Parties, (c) the Consenting
EFIH Second Lien Noteholders and the other Parties, (d) the Consenting EFH Unsecured
Noteholders and the other Parties, or (e) the Consenting EFIH Unsecured Noteholders and the
other Parties, in each case, by the delivery to the Debtors, counsel to the Consenting Interest
Holders, and counsel to the other Consenting Creditors, other than the Consenting Creditors

15

seeking to terminate this Agreement pursuant to this Section 8.01 (such Consenting Creditors,
the Terminating Consenting Creditors) of a written notice in accordance with Section 11.11
hereof by, as applicable: (i) the Consenting Ad Hoc TCEH Committee; (ii) Consenting Creditors
holding at least 50.1% in principal amount of the aggregate amount of the EFIH First Lien Note
Claims held by the Consenting Creditors at such time; (iii) Consenting Creditors holding at least
50.1% in principal amount of the aggregate amount of the EFIH Second Lien Note Claims held
by the Consenting Creditors at such time; (iv) Consenting Creditors holding at least 50.1% in
principal amount of the aggregate amount of the EFH Unsecured Notes Claims held by the
Consenting Creditors at such time; or (v) the Required EFIH Unsecured Consenting Creditors, in
each case, in the exercise of their discretion, upon the occurrence and continuation of any of the
following events:
(a) the Debtors shall not have commenced the Chapter 11 Cases on or before
April 29, 2014;
(b) the Debtors shall not have filed the RSA Assumption Motion with the Bankruptcy
Court on or before the date that is seven (7) days from the Petition Date;
(c) the Bankruptcy Court shall not have entered the RSA Assumption Order on or
before the date that is forty-five (45) days from the Petition Date;
(d) the Debtors shall not have submitted the Ruling Request in respect of the Private
Letter Ruling (which shall, among other things, request the Required Rulings) or filed the Plan
and Disclosure Statement with the Bankruptcy Court on or before the date that is forty-five (45)
days from the Petition Date;
(e) the Bankruptcy Court shall not have entered the Disclosure Statement Order on or
before the date that is one-hundred and five (105) days from the Petition Date;
(f) the Bankruptcy Court shall not have entered the Confirmation Order on or before
the date that is two-hundred and seventy-five (275) days from the Petition Date;
(g) the IRS shall not have issued a Private Letter Ruling acceptable to the Required
Consenting Creditors on or prior to the Extended Outside Date;
(h) the Bankruptcy Court otherwise grants relief that would have a material adverse
effect on the Restructuring Transactions;
(i) the effective date of the Plan (the Plan Effective Date) shall not have occurred
on or before the date that is thirty (30) days after the date that the Bankruptcy Court enters the
Confirmation Order (the Initial Outside Date), it being understood that if all conditions to the
Plan Effective Date other than receipt of any applicable regulatory approvals required to
consummate the Plan and/or the Private Letter Ruling have been satisfied on or before the Initial
Outside Date, the Initial Outside Date shall be automatically extended by an additional thirty
(30) days (such extended date, the Extended Outside Date);

16

(j) the IRS shall have denied the Debtors Ruling Request or shall have informed the
Debtors or their counsel, whether orally or in writing, of its decision not to issue one or more of
the Required Rulings;
(k) the breach by any Party other than the Terminating Consenting Creditors of any
of the representations, warranties, or covenants of such breaching Party as set forth in this
Agreement that would have a material adverse effect on the Restructuring Transactions or the
recovery of any Consenting Creditor; provided, however, (i) that such Terminating Consenting
Creditors shall transmit a notice to the Debtors, counsel to the Consenting Interest Holders and
counsel to the other Consenting Creditors pursuant to Section 11.11 hereof, detailing any such
breach and (ii) any other Consenting Creditor may transmit a notice to any Party detailing a
breach (while providing copies of such notice pursuant to Section 11.11 hereof) and, in either
case,, if such breach is capable of being cured, the breaching Party shall have twenty (20)
business days after receiving such notice to cure any breach;
(l) the issuance by any governmental authority, including any regulatory authority or
court of competent jurisdiction, of any injunction, judgment, decree, charge, ruling or order
enjoining, the consummation of a material portion of the Restructuring Transactions or
materially impacting the recovery of any Consenting Creditor; provided, however, that the
Debtors shall have ten (10) business days after issuance of such injunction, judgment, decree,
charge, ruling or order to obtain relief that would allow consummation of the Restructuring
Transactions that (i) does not prevent or diminish in a material way compliance with the terms of
this Agreement or (ii) is otherwise reasonably acceptable to the Required Consenting Creditors;
(m) an examiner (with expanded powers beyond those set forth in section 1106(a)(3)
and (4) of the Bankruptcy Code), or a trustee or receiver shall have been appointed in one or
more of the Chapter 11 Cases;
(n) any Party other than the Terminating Consenting Creditors files any motion or
pleading with the Bankruptcy Court that is not consistent in any material respect with this
Agreement and such motion or pleading has not been withdrawn or is not otherwise denied by
the Bankruptcy Court within twenty (20) business days of receipt of notice by such party that
such motion or pleading is inconsistent with this Agreement;
(o) the termination of this Agreement by (i)(a) the Consenting TCEH First Lien
Creditors, (b) the Consenting EFH Unsecured Noteholders, (c) the Consenting EFIH Unsecured
Noteholders, or (d) the Consenting Interest Holders or (ii)(a) the Consenting Fidelity EFIH First
Lien Noteholders or (b) the Consenting EFIH Second Lien Noteholders, provided, however,
solely with respect to subsection (ii) hereof, only to the extent Fidelity does not agree to remain
bound to the terms of this Agreement and/or does not subsequently agree to re-execute this
Agreement;
(p) the entry of a ruling or order by the Bankruptcy Court or any other court with
appropriate jurisdiction which, in each case, would have the effect of preventing consummation
of the Restructuring Transactions or materially impacting the recovery of any Consenting
Creditor; provided, however, that the Debtors shall have ten (10) business days after issuance of
such ruling or order to obtain relief that would (i) allow consummation of a material portion of

17

the Restructuring Transactions, (ii)remedy the recovery of such Consenting Creditor in a manner
that does not prevent or diminish in a material way compliance with the terms of this
Agreement, or (iii) is otherwise reasonably acceptable to the Required Consenting Creditors;
(q) the (i) conversion of one or more of the Chapter 11 Cases of EFH, EFIH, TCEH,
EFCH or any Debtor entity obligated under the TCEH First Lien Secured Claims, TCEH Second
Lien Note Claims, EFIH First Lien Note Claims, EFIH Second Lien Note Claims, EFIH
Unsecured Note Claims, or EFH Unsecured Note Claims to a case under chapter 7 of the
Bankruptcy Code or (ii) dismissal of one or more of the Chapter 11 Cases of EFH, EFIH, TCEH,
Lien Note Claims, EFIH First Lien Note Claims, EFIH Second Lien Note Claims, EFIH
Unsecured Note Claims, or EFH Unsecured Note Claims unless such conversion or dismissal, as
applicable, is made with the prior written consent of counsel to the Required Consenting
Creditors;
(r) any of the Plan Restructuring Documents shall have been modified in any
material respect or withdrawn, without the prior written consent of the Required Consenting
Creditors, subject to Section 3; or
(s) the Bankruptcy Court grants relief terminating, annulling, or modifying the
automatic stay (as set forth in section 362 of the Bankruptcy Code) with regard to any material
assets of the Debtors that would have a material adverse effect on the Restructuring
Transactions, without the prior written consent of the Required Consenting Creditors.
8.02. EFIH Unsecured Noteholder, EFIH First Lien Noteholder, EFIH Second Lien
Noteholder, and EFH Unsecured Noteholder Termination Events. This Agreement may be
terminated as between (a) the Consenting EFIH Unsecured Noteholders and the other Parties, (b)
the Consenting Fidelity EFIH First Lien Noteholders and the other Parties, (c) the Consenting
EFIH Second Lien Noteholders and the other Parties, and (d) the Consenting EFH Unsecured
Creditors and the other Parties by the delivery to the Debtors, counsel to the Consenting Interest
Holders, and counsel to the other Consenting Creditors, of a written notice in accordance with
Section 11.11 hereof by, as applicable: (i) Consenting Creditors holding at least 50.1% in
principal amount of the aggregate amount of the EFIH First Lien Note Claims held by the
Consenting Creditors at such time; (ii) Consenting Creditors holding at least 50.1% in principal
amount of the aggregate amount of the EFIH Second Lien Note Claims held by the Consenting
Creditors at such time; (iii) Consenting Creditors holding at least 50.1% in principal amount of
the aggregate amount of the EFH Unsecured Note Claims held by the Consenting Creditors at
such time; or (iv) the Required EFIH Unsecured Consenting Creditors, in each case, in the
exercise of their discretion, upon the occurrence and continuation of any of the following events:
(a) the Debtors have not filed each of the EFIH First Lien DIP Motion, the EFIH
Second Lien DIP Motion, and the Approval Motion on or before the date that is fourteen (14)
days from the Petition Date;
(b) the Bankruptcy Court shall not have entered each of the Approval Order, the order
approving the EFIH First Lien DIP Motion (the EFIH First Lien DIP Order), and an order
approving the EFIH Second Lien DIP Motion (the EFIH Second Lien DIP Order) on or

18

before the date that is seventy-five (75) days from the Petition Date (it being understood that the
Debtors will use commercially reasonable efforts to obtain entry of the EFIH First Lien DIP
Order and the EFIH Second Lien DIP Order on or before the date that is forty-five (45) days
from the Petition Date);
(c) the Debtors shall not have consummated each of (i) the EFIH First Lien DIP
Financing, (ii) the EFIH Second Lien DIP Financing, and (iii) the transactions and settlements
contemplated by the Approval Order on or before the date that is five (5) business days after the
date the EFIH First Lien DIP Order, the EFIH Second Lien DIP Order, and the Approval Order,
as applicable, is entered; or
(d) either the Commitment Letter or the Conversion Agreement is terminated
according to its terms prior to consummation of the transactions contemplated therein.
8.03. Consenting TCEH First Lien Holders Termination Events. This Agreement may
be terminated as between the Consenting TCEH First Lien Creditors and the other Parties by the
delivery to the Debtors, counsel to the Consenting Interest Holders, and counsel to the other
Consenting Creditors other than the Terminating Consenting Creditors of a written notice in
accordance with Section 11.11 hereof by the Consenting Ad Hoc TCEH Committee, in the
exercise of their sole discretion, upon the occurrence and continuation of any of an Event of
Default under the TCEH Cash Collateral Order.
8.04. Consenting Non-Fidelity EFIH First Lien Noteholders. This Agreement may be
terminated as between a Consenting Non-Fidelity EFIH First Lien Noteholder and the Debtors
by the delivery to the Debtors of a written notice in accordance with Section 11.11 hereof by
such terminating Consenting Non-Fidelity EFIH First Lien Noteholder, in the exercise of its
discretion, upon the occurrence and continuation of any of the following events:
(a) the Debtors have not filed each of the EFIH First Lien DIP Motion and the
Approval Motion on or before the date that is fourteen (14) days from the Petition Date;
(b) the Bankruptcy Court shall not have entered each of the Approval Order and the
EFIH First Lien DIP Order on or before the date that is seventy-five (75) days from the Petition
Date;
(c) the Debtors shall not have consummated each of (i) the EFIH First Lien DIP
Financing, (ii) the transactions and settlements contemplated by the Approval Order on or before
the date that is five (5) business days after the date the EFIH First Lien DIP Order and the
Approval Order, as applicable, is entered;
(d) the Bankruptcy Court otherwise grants relief on a final basis that would have a
material adverse effect on the Restructuring Transactions;
(e) the Plan Effective Date shall not have occurred on or before the Initial Outside
Date, it being understood that if all conditions to the Plan Effective Date other than receipt of any
applicable regulatory approvals required to consummate the Plan and/or the Private Letter Ruling
have been satisfied or are capable of being satisfied on or before the Initial Outside Date, the
Initial Outside Date shall be automatically extended to the Extended Outside Date;

19

(f) the breach by any Party other than the Terminating Consenting Creditors of any
of the representations, warranties, or covenants of such breaching Party as set forth in this
Agreement that would have a material adverse effect on the Restructuring Transactions or the
recovery of any Consenting Creditor; provided, however, (i) that such Terminating Consenting
Creditors shall transmit a notice to the Debtors, counsel to the Consenting Interest Holders and
counsel to the other Consenting Creditors pursuant to Section 11.11 hereof, detailing any such
breach and (ii) any other Consenting Creditor may transmit a notice to any Party detailing a
breach (while providing copies of such notice pursuant to Section 11.11 hereof) and, in either
case,, if such breach is capable of being cured, the breaching Party shall have twenty (20)
business days after receiving such notice to cure any breach;
(g) the issuance by any governmental authority, including any regulatory authority or
court of competent jurisdiction, of any injunction, judgment, decree, charge, ruling or order
enjoining, the consummation of a material portion of the Restructuring Transactions; provided,
however, that the Debtors shall have ten (10) business days after issuance of such injunction,
judgment, decree, charge, ruling or order to obtain relief that would allow consummation of the
Restructuring Transactions that (i) does not prevent or diminish in a material way compliance
with the terms of this Agreement or (ii) is otherwise reasonably acceptable to the applicable
Consenting Non-Fidelity EFIH First Lien Noteholder(s);
(h) an examiner (with expanded powers beyond those set forth in section 1106(a)(3)
and (4) of the Bankruptcy Code), or a trustee or receiver shall have been appointed in one or
more of the Chapter 11 Cases;
(i) any Party other than the Terminating Consenting Creditors files any motion or
pleading with the Bankruptcy Court that is not consistent in any material respect with this
Agreement and such motion or pleading has not been withdrawn or is not otherwise denied by
the Bankruptcy Court within twenty (20) business days of receipt of notice by such party that
such motion or pleading is inconsistent with this Agreement; or
(j) the entry of a ruling or order by the Bankruptcy Court or any other court with
appropriate jurisdiction which, in each case, would have the effect of preventing consummation
of the Restructuring Transactions or materially impacting the recovery of any Consenting Non-
Fidelity EFIH First Noteholder ; provided, however, that the Debtors shall have ten (10) business
days after issuance of such ruling or order to obtain relief that would (i) allow consummation of
a material portion of the Restructuring Transactions, (ii) remedy the recovery of such Consenting
Non-Fidelity EFIH First Lien Noteholder in a manner that does not prevent or diminish in a
material way compliance with the terms of this Agreement, or (iii) is otherwise reasonably
acceptable to the applicable Consenting Non-Fidelity EFIH First Lien Noteholder(s).

20

8.05. Consenting Interest Holders Termination Events. This Agreement may be
terminated as between the Consenting Interest Holders and the other Parties by the delivery to
the Debtors and counsel to the Consenting Creditors, of a written notice in accordance with
Section 11.11 hereof by all of the undersigned holders of the Texas Holdings Interests and the
TEF Interests, in the exercise of their discretion, upon the occurrence and continuation of any of
the following events:
(a) the Debtors shall not have commenced the Chapter 11 Cases on or before
April 29, 2014;
(b) the Plan Effective Date shall not have occurred by the Initial Outside Date or the
Extended Outside Date, as applicable;
(c) the breach by the Debtors of any of the representations, warranties, or covenants
of the Debtors set forth in this Agreement that would have a material adverse effect on the
Restructuring Transactions; provided, however, that (i) the Debtors shall undertake commercially
reasonable efforts to provide the Consenting Interest Holders with prompt written notice of the
occurrence of such breach and (ii) the Consenting Interest Holders may transmit a notice to the
Debtor (detailing a breach (while providing copies of such notice to the Consenting Creditors
pursuant to Section 11.11 hereof) and, in either case, if such breach is capable of being cured, the
Debtors shall have ten (10) business days after the date of providing or receiving notice, as
applicable, to cure any breach; or
(d) the (i) conversion of one or more of the Chapter 11 Cases of EFH, EFIH, TCEH,
Lien Note Claims, EFIH First Lien Note Claims, or EFIH Second Lien Note Claims to a case
under chapter 7 of the Bankruptcy Code or (ii) dismissal of one or more of the Chapter 11 Cases
of EFH, EFIH, TCEH, EFCH or any Debtor entity obligated under the TCEH First Lien Secured
Claims, TCEH Second Lien Note Claims, EFIH First Lien Note Claims, or EFIH Second Lien
Claims, unless such conversion or dismissal, as applicable, is made with the prior written consent
of counsel to the Consenting Interest Holders.
8.06. Debtors Termination Events. Any Debtor may terminate this Agreement as to all
Parties upon five (5) business days prior written notice, delivered in accordance with
Section 11.11 hereof, upon the occurrence of any of the following events: (a) the Plan Effective
Date shall not have occurred by the Initial Outside Date or the Extended Outside Date, as
applicable; (b) the breach by any of the Restructuring Support Parties of any material provision
set forth in this Agreement that remains uncured for a period of fifteen (15) business days after
the receipt by the Restructuring Support Parties of notice of such breach; (c) the board of
directors, board of managers, or such similar governing body of any Debtor determines based on
advice of counsel that proceeding with any of the Restructuring Transactions would be
inconsistent with the exercise of its fiduciary duties; or (d) the issuance by any governmental
authority, including any regulatory authority or court of competent jurisdiction, of any final, non-
appealable ruling or order enjoining the consummation of a material portion of the Restructuring
Transactions.

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8.07. Mutual Termination. This Agreement, and the obligations of all Parties
hereunder, may be terminated by mutual agreement among all of the following: (a) each of the
Consenting Interest Holders; (b) the Consenting Ad Hoc TCEH Committee; (c) Consenting
Fidelity EFIH First Lien Noteholders holding at least 50.1% in principal amount of the aggregate
amount of the EFIH First Lien Note Claims held by the Consenting Fidelity EFIH First Lien
Noteholders at such time; (d) Consenting Creditors holding at least 50.1% in principal amount of
the aggregate amount of the EFIH Second Lien Note Claims held by all Consenting Creditors at
such time; (e) Consenting Creditors holding at least 50.1% in principal amount of the aggregate
amount of the EFH Unsecured Note Claims held by the Consenting Creditors at such time;
(f) the Required EFIH Unsecured Consenting Creditors; and (g) each of the Debtors.
8.08. Termination Upon Completion of the Restructuring Transactions. This
Agreement shall terminate automatically without any further required action or notice on the
Plan Effective Date.
8.09. Individual Consenting Creditor Termination. Notwithstanding anything to the
contrary herein:
(a) If the Plan Effective Date does not occur by the earlier of (1) the Extended
Outside Date and (2) three hundred thirty-five (335) days from the Petition Date, then each
Consenting Creditor may terminate its rights and obligations under this Agreement without
affecting the other Parties rights and obligations by providing notice of the same in accordance
with Section 11.11 hereof.
(b) If there are any changes to the terms of the TCEH Cash Collateral Order that have
a material, disproportionate (as compared to other Consenting Creditors holding Claims within
the same Class as provided for in the Term Sheet) and adverse effect on a Consenting Creditor
without such Consenting Creditors prior written consent, then such Consenting Creditor may
terminate its rights and obligations under this Agreement without affecting the other Parties
rights and obligations by providing notice of the same in accordance with Section 11.11 hereof.
(c) If the Plan (as it may be modified, amended or supplemented) includes terms in
respect of the TCEH Incremental 2012 Term Loans that provide for a material, disproportionate
(as compared to other Consenting Creditors holding Claims within the same Class as provided
for in the Term Sheet) and adverse effect on any Consenting Creditor that beneficially holds the
TCEH Incremental 2012 Term Loans (including, without limitation, any disparate treatment with
respect to the releases granted under the Plan), then such Consenting Creditor may terminate its
rights and obligations under this Agreement without affecting the other Parties hereto by
providing notice of the same in accordance with Section 11.11 hereof.
(d) If any person commences, or obtains standing to commence, a Permitted Cause of
Action against a Consenting Creditor (or with respect to Claims beneficially held by such
Consenting Creditor), then such Consenting Creditor may terminate its rights and obligations
under this Agreement without affecting the other Parties rights and obligations by providing
notice of the same in accordance with Section 11.11 hereof.

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8.10. Fidelity Termination Events. This Agreement may be terminated as between
Fidelity and all Parties by the delivery to the Debtors, counsel to the Consenting Interest Holders,
and counsel to the other Consenting Creditors, of a written notice in accordance with
Section 11.11 hereof by Fidelity with respect to all Debtor Claims/Interests that Fidelity holds at
such time, in the exercise of its discretion, upon the occurrence and continuation of any of the
following events; provided, however, Fidelity shall not have the right to terminate this
Agreement pursuant to this Section 8.10 if the Commitment Parties exercise their Call Right
within ten (10) days of Fidelitys exercise of a termination right under this Section 8.10:
(a) on the date that is ten (10) business days prior to the first day of the hearing for
the Bankruptcy Court to approve entry of the Disclosure Statement Order (the Disclosure
Statement Hearing), if the Debtors have notified Fidelity and all other Parties at least fifteen
(15) days prior to the Disclosure Statement Hearing that the Debtors have determined in good
faith that the recovery for the EFH Non-Guaranteed Notes is expected to be less than 37.15%
(such notification, the EFH Minimum Recovery Notification); and
(b) on the date that is ten (10) business days prior to the first day of the hearing for
the Bankruptcy Court to approve entry of the Confirmation Order (the Confirmation
Hearing), if (i) the Debtors did not make the EFH Minimum Recovery Notification and
(ii) Fidelity notifies all other Parties at least ten (10) business days prior to the first day of the
Confirmation Hearing that Fidelity has determined in good faith that the recovery for the EFH
Non-Guaranteed Notes is expected to be less than 37.15%.
8.11. Effect of Termination. No Party may terminate this Agreement if such Party
failed to perform or comply in all material respects with the terms and conditions of this
Agreement, with such failure to perform or comply causing, or resulting in, the occurrence of
one or more termination events specified herein. The date on which termination of this
Agreement as to a Party is effective in accordance with Sections 8.01, 8.02, 8.03, 8.04, 8.05,
8.06, 8.07, 8.08, 8.09, and 8.10 shall be referred to as a Termination Date. Except as set forth
below, upon the occurrence of a Termination Date as to a Party, this Agreement shall be of no
further force and effect and each Party subject to such termination shall be released from its
commitments, undertakings, and agreements under or related to this Agreement and shall have
the rights and remedies that it would have had, had it not entered into this Agreement, and shall
be entitled to take all actions, whether with respect to the Restructuring Transactions or
otherwise, that it would have been entitled to take had it not entered into this Agreement;
provided, however, that the occurrence of a Termination Date as to a Party shall not affect the
Debtors obligations under Section 10 with respect to amounts accrued up to and including such
Termination Date; provided, further, that Section 4.03(a)(viii) and Section 8.12 shall survive the
termination of this Agreement. Upon the occurrence of a Termination Date, any and all consents
or ballots tendered by the Parties subject to such termination before a Termination Date shall be
deemed, for all purposes, to be null and void from the first instance and shall not be considered
or otherwise used in any manner by the Parties in connection with the Restructuring Transactions
and this Agreement or otherwise. Notwithstanding anything to the contrary in this Agreement or
the Commitment Letter, the foregoing shall not be construed to prohibit the Debtors or any of the
Restructuring Support Parties from contesting whether any such termination is in accordance
with its terms or to seek enforcement of any rights under this Agreement or the Commitment
Letter that arose or existed before a Termination Date. Except as expressly provided in this

23

Agreement (including as set forth in Section 8.12) , nothing herein is intended to, or does, in any
manner waive, limit, impair, or restrict (a) any right of any Debtor or the ability of any Debtor to
protect and reserve its rights (including rights under this Agreement), remedies, and interests,
including its claims against any Consenting Interest Holder or Consenting Creditor, and (b) any
right of any Consenting Interest Holder or Consenting Creditor, or the ability of any Consenting
Interest Holder or Consenting Creditor to protect and preserve its rights (including rights under
this Agreement), remedies, and interests, including its claims against any Debtor, Consenting
Interest Holder, or Consenting Creditor. Nothing in this Section 8.09 shall restrict any Debtors
right to terminate this Agreement in accordance with Section 8.06(c).
8.12. No Violation of Automatic Stay. The automatic stay applicable under section 362
of the Bankruptcy Code shall not prohibit a Restructuring Support Party from taking any action
necessary to effectuate the termination of this Agreement pursuant to the terms hereof.
Section 9. Amendments. This Agreement, including the Term Sheet and the Plan, may not
be modified, amended, or supplemented in any manner except in writing signed by all of the
following: (a) the Consenting Interest Holders, (b) the Consenting Ad Hoc TCEH Committee;
(c) Consenting Creditors holding at least 50.1% in principal amount of the aggregate amount of
the EFH Unsecured Note Claims held at such time by the Consenting Creditors; (d) Consenting
Fidelity EFIH First Lien Noteholders holding at least 50.1% in principal amount of the aggregate
amount of the EFIH First Lien Note Claims held by all Consenting Fidelity First Lien
Noteholders at such time; (e) Consenting Creditors holding at least 50.1% in principal amount of
the aggregate of each of the EFIH Second Lien Note Claims at such time; (f) the Required EFIH
Unsecured Consenting Creditors; (g) each applicable Consenting Non-Fidelity EFIH First Lien
Noteholder(s); and (h) each of the Debtors; provided, however, that if the proposed modification,
amendment or supplement has a material, disproportionate (as compared to other Consenting
Creditors holding Claims within the same Class as provided for in the Term Sheet) and adverse
effect on any of the Restructuring Support Parties or the Claims held by such Restructuring
Support Parties (including any disparate treatment with respect to the releases granted under the
Plan), then the consent of each such affected Restructuring Support Party shall also be required
to effectuate such modification, amendment or supplement; provided, further, however, that
Section 8.09 and Section 9 shall not be amended without the consent of each Consenting
Creditor. Any proposed modification, amendment, or supplement that is not approved by the
requisite Parties as set forth above shall be ineffective and void ab initio.
Section 10. Fees and Expenses. Subject to Section 8.11, the Debtors shall pay or reimburse
when due the following reasonable and documented professional fees and expenses: (a)(i) one
(1) primary counsel, one (1) local counsel, one (1) regulatory counsel, one (1) financial advisor,
one (1) tax advisor, and one (1) technical and market advisor for, on a collective basis, all
Consenting TCEH First Lien Creditors and (ii) the professionals identified on Schedule 2
attached hereto, in each case, upon the Bankruptcy Courts entry of the RSA Assumption Order;
(b) one (1) primary counsel, one (1) local counsel, one (1) regulatory counsel, one (1) tax
advisor, and one (1) financial advisor for, on a collective basis, all Consenting EFIH Unsecured
Noteholders, upon the Bankruptcy Courts entry of the earlier of the Approval Order and the
RSA Assumption Order; (c) one (1) primary counsel, one (1) local counsel, one (1) regulatory
counsel, and one (1) financial advisor for, on a collective basis, all Consenting EFH Unsecured
Noteholders, Consenting Fidelity EFIH First Lien Noteholders (in connection with EFH

24

Unsecured Note Claims, EFIH First Lien Note Claims, and EFIH Second Lien Note Claims
beneficially owned by Fidelity) upon the Bankruptcy Courts entry of the earlier of the Approval
Order and the RSA Assumption Order; (d) one (1) primary counsel and one (1) local counsel for
each of the Consenting Non-Fidelity EFIH First Lien Noteholders that are a Party as of the
Agreement Effective Date; and (e) one (1) primary counsel, one (1) local counsel, one (1)
regulatory counsel, and one (1) financial advisor for, on a collective basis, all Consenting Interest
Holders upon the occurrence of the Plan Effective Date. Additionally, EFIH may, in its
reasonable discretion, pay the reasonable and documented fees and expenses of professionals
retained by Consenting Non-Fidelity EFIH First Lien Noteholders that become a Party after the
Agreement Effective Date. Fees and expenses described in this Section 10 shall be allocated as
described in the Term Sheet.
Section 11. Miscellaneous.
11.01. Further Assurances. Subject to the other terms of this Agreement, the Parties
agree to execute and deliver such other instruments and perform such acts, in addition to the
matters herein specified, as may be reasonably appropriate or necessary, or as may be required
by order of the Bankruptcy Court, from time to time, to effectuate the Restructuring
Transactions, as applicable.
11.02. Service on an Official Committee. Notwithstanding anything herein to the
contrary, if an official committee is appointed in the Chapter 11 Cases and a Consenting Creditor
is appointed to and serves on such official committee, then the terms of this Agreement shall not
be construed to limit such Consenting Creditors exercise of its fiduciary duties in its role as a
member of such committee; provided, however, that serving as a member of such committee
shall not relieve the Consenting Creditor of any obligations under this Agreement; provided,
further, that nothing in the Agreement shall be construed as requiring any Consenting Creditor to
serve on any official committee in these Chapter 11 Cases.
11.03. Complete Agreement. This Agreement constitutes the entire agreement among
the Parties with respect to the subject matter hereof and supersedes all prior agreements, oral or
written, among the Parties with respect thereto.
11.04. Headings. The headings of all sections of this Agreement are inserted solely for
the convenience of reference and are not a part of and are not intended to govern, limit, or aid in
the construction or interpretation of any term or provision hereof.
11.05. GOVERNING LAW; SUBMISSION TO JURISDICTION; SELECTION OF
FORUM; WAIVER OF TRIAL BY JURY. THIS AGREEMENT IS TO BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF DELAWARE APPLICABLE
TO CONTRACTS MADE AND TO BE PERFORMED IN SUCH STATE, WITHOUT
GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF. Each Party
hereto agrees that it shall bring any action or proceeding in respect of any claim arising out of or
related to this Agreement, to the extent possible, in either the United States District Court for the
District of Delaware or any Delaware State court (the Chosen Courts), and solely in
connection with claims arising under this Agreement: (a) irrevocably submits to the exclusive
jurisdiction of the Chosen Courts; (b) waives any objection to laying venue in any such action or

25

proceeding in the Chosen Courts; and (c) waives any objection that the Chosen Courts are an
inconvenient forum or do not have jurisdiction over any Party hereto; provided, however, that if
the Debtors commence the Chapter 11 Cases, then the Bankruptcy Court (or court of proper
appellate jurisdiction) shall be the exclusive Chosen Court.
11.06. Confidentiality; Disclosure. The Debtors shall keep strictly confidential and shall
not, without the prior written consent of the applicable Consenting Creditor, disclose publicly, or
to any person (including any Restructuring Support Party) (a) the holdings of any Consenting
Creditor, including the principal amount of TCEH First Lien Claims, EFIH Unsecured Note
Claims, EFIH First Lien Note Claims, EFIH Second Lien Note Claims, and EFH Unsecured
Note Claims and any other claims held against the applicable Debtor or (b) the identity of any
Consenting Creditor or its controlled affiliates, officers, directors, managers, stockholders,
members, employees, partners, representatives or agents as a party to this Agreement, in any
public manner, including in the Solicitation Materials, the Plan, or any related press release;
provided, however, that (x) the Debtors may disclose such names or amounts to the extent that,
upon the advice of counsel, it is required to do so by any governmental or regulatory authority
(including federal securities laws and regulations), in which case the Debtors, prior to making
such disclosure, shall allow the Consenting Creditor to whom such disclosure relates reasonable
time at its own cost to seek a protective order with respect to such disclosures, and (y) the
Debtors may disclose the aggregate percentage or aggregate principal amount of (i) outstanding
TEF Interests; (ii) outstanding Texas Holdings Interests; (iii) TCEH Credit Agreement Claims;
(iv) TCEH First Lien Notes; (v) TCEH First Lien Commodity Hedges; (vi) TCEH First Lien
Interest Rate Swaps; (vii) EFIH First Lien Notes; (viii) EFIH Second Lien Notes; (ix) EFIH
Unsecured Notes; and (x) EFH Unsecured Note Claims held by the Consenting Creditors
(without naming such Consenting Creditors). No Consenting Creditor or Consenting Interest
Holder shall, without the prior written consent of the Debtors, make any public announcement or
otherwise communicate (other than to decline to comment) with any person with respect to
Restructuring Transactions or any of the transactions contemplated hereby or thereby, other than
as may be required by applicable law and regulation or by any governmental or regulatory
authority. This Section 11.06 shall not apply with respect to any information that is or becomes
available to the public other than as a result of a disclosure in violation of any Partys obligations
under this Agreement.
11.07. Trial by Jury Waiver. EACH PARTY HERETO IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
11.08. Execution of Agreement. This Agreement may be executed and delivered in any
number of counterparts and by way of electronic signature and delivery, each such counterpart,
when executed and delivered, shall be deemed an original, and all of which together shall
constitute the same agreement. Except as expressly provided in this Agreement, each individual
executing this Agreement on behalf of a Party has been duly authorized and empowered to
execute and deliver this Agreement on behalf of said Party.
11.09. Interpretation and Rules of Construction. This Agreement is the product of
negotiations among the Debtors, the Consenting Interest Holders, and the Consenting Creditors,

26

and in the enforcement or interpretation hereof, is to be interpreted in a neutral manner, and any
presumption with regard to interpretation for or against any Party by reason of that Party having
drafted or caused to be drafted this Agreement, or any portion hereof, shall not be effective in
regard to the interpretation hereof. The Debtors, the Consenting Interest Holders, and the
Consenting Creditors were each represented by counsel during the negotiations and drafting of
this Agreement and continue to be represented by counsel. In addition, this Agreement shall be
interpreted in accordance with section 102 of the Bankruptcy Code.
11.10. Successors and Assigns. This Agreement is intended to bind and inure to the
benefit of the Parties and their respective successors and permitted assigns, as applicable. There
are no third party beneficiaries under this Agreement, and the rights or obligations of any Party
under this Agreement may not be assigned, delegated, or transferred to any other person or
entity.
11.11. Notices. All notices hereunder shall be deemed given if in writing and delivered,
if sent by electronic mail, courier, or registered or certified mail (return receipt requested) to the
following addresses (or at such other addresses as shall be specified by like notice):
(a) if to a Debtor, to:
Energy Future Holdings Corp., et al.
Energy Plaza
1601 Bryan Street
Dallas, Texas 75201
Attention: General Counsel
E-mail address: stacey.dore@energyfutureholdings.com; and
andrew.wright@energyfutureholdings.com

with copies (which shall not constitute notice) to:
Kirkland & Ellis LLP
601 Lexington Avenue
New York, New York 10022
Attention: Richard M. Cieri, Edward O. Sassower, P.C., Stephen E. Hessler, and
Brian E. Schartz
E-mail addresses: rcieri@kirkland.com, esassower@kirkland.com,
shessler@kirkland.com, and bschartz@kirkland.com
and
Kirkland & Ellis LLP
300 North LaSalle Street
Chicago, IL 60654
Attention: Chad J. Husnick and Steven N. Serajeddini
E-mail address: chusnick@kirkland.com and steven.serajeddini@kirkland.com

(b) if to a Consenting Interest Holder, to:

27

Wachtell Lipton Rosen & Katz
51 W. 52nd Street
Attention: Richard G. Mason and Austin T. Witt
E-mail addresses: rgmason@wlrk.com and awitt@wlrk.com

(c) if to a Consenting TCEH First Lien Lender, Consenting TCEH First Lien
Noteholder, to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
Attention: Alan W. Kornberg, Brian S. Hermann, and Jacob A. Adlerstein
E-mail addresses: akornberg@paulweiss.com, bhermann@paulweiss.com, and
jadlerstein@paulweiss.com

(d) if to a Consenting EFIH Unsecured Noteholder, to:
Akin Gump Strauss Hauer & Feld LLP
One Bryant Park
Bank of America Tower
Attention: Ira S. Dizengoff and Scott L. Alberino
E-mail addresses: idizengoff@akingump.com and salberino@akingump.com

(e) if to a Consenting Fidelity EFIH First Lien Noteholder, Consenting EFIH Second
Lien Noteholder, Consenting EFH Unsecured Noteholder (each in connection with EFH
Unsecured Note Claims, EFIH First Lien Note Claims and EFIH Second Lien Note Claims
beneficially owned by Fidelity), to:
Fried, Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
Attention: Brad Eric Scheler, Gary L. Kaplan, and Matthew Roose
E-mail addresses: brad.scheler@friedfrank.com, gary.kaplan@friedfrank.com, and
matthew.roose@friedfrank.com

(f) if to a Consenting Non-Fidelity EFIH First Lien Noteholder, to:
Bingham McCutchen LLP
399 Park Avenue
New York, New York 10022-4689
Attention: Jeffrey S. Sabin
E-mail address: jeffrey.sabin@bingham.com

and


28

Bingham McCutchen LLP
One Federal Street
Boston, Massachussetts 02110-1726
Attention: Julia Frost-Davies
E-mail address: julia.frost-davies@bingham.com

or such other address as may have been furnished by a Party to each of the other Parties by
notice given in accordance with the requirements set forth above.

Any notice given by delivery, mail, or courier shall be effective when received.
11.12. Access. The Debtors will provide the Restructuring Support Parties and their
respective attorneys, consultants, accountants, and other authorized representatives reasonable
access, upon reasonable notice during normal business hours, to relevant properties, books,
contracts, commitments, records, management personnel, lenders, and advisors of the Debtors;
provided, however, that the Debtors obligation hereunder shall be conditioned upon such Plan
Support Party being party to an executed Confidentiality Agreement with the Debtors.
11.13. Independent Due Diligence and Decision Making. Each Consenting Party hereby
confirms that its decision to execute this agreement has been based upon its independent
investigation of the operations, businesses, financial and other conditions, and prospects of the
Debtors.
11.14. Waiver. If the Restructuring Transactions are not consummated, or if this
Agreement is terminated for any reason, the Parties fully reserve any and all of their rights.
Pursuant to Federal Rule of Evidence 408 and any other applicable rules of evidence, this
Agreement and all negotiations relating hereto shall not be admissible into evidence in any
proceeding other than a proceeding to enforce its terms, pursue the consummation of the
Restructuring Transactions, or the payment of damages to which a Party may be entitled under
this Agreement.
11.15. Specific Performance. It is understood and agreed by the Parties that money
damages would be an insufficient remedy for any breach of this Agreement by any Party and
each non-breaching Party shall be entitled to specific performance and injunctive or other
equitable relief (without the posting of any bond and without proof of actual damages) as a
remedy of any such breach, including an order of the Bankruptcy Court or other court of
competent jurisdiction requiring any Party to comply promptly with any of its obligations
hereunder.
11.16. Several, Not Joint, Claims. The agreements, representations, warranties, and
obligations of the Parties under this Agreement are, in all respects, several and not joint.
11.17. Severability and Construction. If any provision of this Agreement shall be held
by a court of competent jurisdiction to be illegal, invalid, or unenforceable, the remaining
provisions shall remain in full force and effect if essential terms and conditions of this
Agreement for each Party remain valid, binding, and enforceable.

29

11.18. Remedies Cumulative. All rights, powers, and remedies provided under this
Agreement or otherwise available in respect hereof at law or in equity shall be cumulative and
not alternative, and the exercise of any right, power, or remedy thereof by any Party shall not
preclude the simultaneous or later exercise of any other such right, power, or remedy by such
Party.
IN WITNESS WHEREOF, the Parties have executed this Agreement on the day
and year first above written.


Document2
SIGNATURE PAGES

[REDACTED]


EXHIBIT A to
the Restructuring Support and Lock-Up Agreement

Term Sheet

Execution Version

THIS TERM SHEET IS NOT AN OFFER WITH RESPECT TO ANY SECURITIES OR A
SOLICITATION OF ACCEPTANCES OF A CHAPTER 11 PLAN WITHIN THE MEANING OF
SECTION 1125 OF THE BANKRUPTCY CODE. ANY SUCH OFFER OR SOLICITATION
WILL COMPLY WITH ALL APPLICABLE SECURITIES LAWS AND/OR PROVISIONS OF
THE BANKRUPTCY CODE. NOTHING CONTAINED IN THIS TERM SHEET SHALL BE AN
ADMISSION OF FACT OR LIABILITY OR, UNTIL THE OCCURRENCE OF THE
AGREEMENT EFFECTIVE DATE ON THE TERMS DESCRIBED HEREIN AND IN THE
RESTRUCTURING SUPPORT AGREEMENT, DEEMED BINDING ON ANY OF THE
PARTIES HERETO.
RESTRUCTURI NG TERM SHEET
INTRODUCTION
This term sheet (this Term Sheet)
1
describes the terms of a restructuring of: (a) Energy Future
Holdings Corp., a Texas corporation (EFH); (b) EFHs wholly-owned direct subsidiaries Energy
Future Intermediate Holding Company LLC, a Delaware limited liability company (EFIH) and Energy
Future Competitive Holdings Company LLC, a Delaware limited liability company (EFCH);
(c) EFIHs wholly-owned direct subsidiary, EFIH Finance Inc., a Delaware corporation; (d) EFCHs
wholly-owned direct subsidiary, Texas Competitive Electric Holdings Company LLC, a Delaware limited
liability company (TCEH); (e) TCEHs directly and indirectly-owned subsidiaries listed on Exhibit B;
and (f) EFHs directly and indirectly-owned subsidiaries listed on Exhibit C (the entities listed in clauses
(a) through (f) collectively, the Debtors, and such restructuring, the Restructuring).
The Debtors will implement the Restructuring through a prearranged plan of reorganization, which shall
be consistent with the terms of this Term Sheet and the Restructuring Support Agreement (as it may be
amended or supplemented from time to time in accordance with the terms of the Restructuring Support
Agreement, the Plan) under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court
for the District of Delaware or another bankruptcy court of competent jurisdiction with respect to the
subject matter (the Bankruptcy Court). This Term Sheet incorporates the rules of construction set
forth in section 102 of the Bankruptcy Code.
The governing documents with respect to the Restructuring will contain terms and conditions that are
dependent on each other, including those described in this Term Sheet.
This Term Sheet does not include a description of all of the terms, conditions, and other provisions that
are to be contained in the definitive documentation governing the Restructuring, which remain subject to
discussion and negotiation in accordance with the Restructuring Support Agreement. The Restructuring
will not contain any material terms or conditions that are inconsistent in any material respect with this
Term Sheet or the Restructuring Support Agreement. This Term Sheet is confidential and may not be
released to any other party unless permitted under the Restructuring Support Agreement or in accordance
with a Confidentiality Agreement (as defined in the Restructuring Support Agreement).

1
Capitalized terms used but not otherwise defined in this Term Sheet have the meanings ascribed to such terms
as set forth on Exhibit A.

2

OVERVIEW OF THE RESTRUCTURING
In general, the Restructuring contemplates that:
(a) The Debtors will implement the Restructuring in the Bankruptcy Court pursuant to the
Plan on the terms set forth in this Term Sheet.
(b) Holders of the TCEH First Lien Secured Claims will receive their Pro Rata share of
(i) 100% of the Reorganized TCEH Common Stock, subject to dilution only by the
Reorganized TCEH Management Incentive Plan; and (ii) 100% of the net cash proceeds
from the issuance of the New Reorganized TCEH Debt.
(c) Holders of General Unsecured Claims Against the TCEH Debtors (which shall include
TCEH First Lien Deficiency Claims, TCEH Second Lien Note Claims, and TCEH
Unsecured Note Claims) will receive their Pro Rata share of the TCEH Unsecured Claim
Fund.
(d) Pursuant to the EFIH First Lien Settlement, Settling EFIH First Lien Note Holders will
convert their EFIH First Lien Note Claims to EFIH First Lien DIP Claims in an amount
equal to the greater of (i) (A) 105% of the principal plus (B) 101% of accrued and unpaid
interest at the non-default rate on such principal, through consummation of the EFIH First
Lien DIP Financing (which amount shall be deemed to include the original issue discount
paid in respect of the EFIH First Lien DIP Financing); and (ii) (A) 104% of the principal
plus (B) accrued and unpaid interest at the non-default rate on such principal, through
consummation of the EFIH First Lien DIP Financing, plus original issue discount paid in
respect of the EFIH First Lien DIP Financing, it being understood that in connection with
such loans, Settling EFIH First Lien Note Holders shall be entitled to interest in
accordance with the EFIH First Lien DIP Financing, but shall not be entitled to any other
fees (including commitment fees) paid in respect of the EFIH First Lien DIP Financing.
Any other Allowed EFIH First Lien Note Claims shall receive their Pro Rata share of cash
in the amount of such Claims on the Effective Date or such other treatment as permitted
under section 1129(b) of the Bankruptcy Code, as mutually agreed by EFIH and the
Required EFIH Unsecured Consenting Creditors.
(e) Pursuant to the EFIH Second Lien Settlement, Settling EFIH Second Lien Note Holders
will receive their Pro Rata share of (a) principal plus accrued and unpaid interest at the
non-default rate, through consummation of the EFIH Second Lien DIP Financing; and
(b) 50% of the aggregate amount of the EFIH Second Lien Makewhole Claims. Fidelity
may use the proceeds it receives on account of the EFIH Second Lien Settlement to
participate in the EFIH First Lien DIP Financing in an amount up to $500 million. The
Debtors will initiate litigation to obtain entry of an order disallowing any EFIH Second
Lien Makewhole Claim of Non-Settling EFIH Second Lien Note Holders, and Non-
Settling EFIH Second Lien Note Holders will receive their Pro Rata share of cash on hand
at EFIH or from the proceeds of the EFIH Second Lien DIP Financing and available cash
at EFIH in an amount equal to the principal plus accrued and unpaid interest, through
consummation of the EFIH Second Lien DIP Financing, at the non-default rate of such
Holders Claim (not including any premiums, fees, or Claims relating to the repayment of
the EFIH Second Lien Note Claims). Any other Allowed EFIH Second Lien Note Claims
shall receive their Pro Rata share of cash in the amount of such Claims on the Effective
Date or such other treatment as permitted under section 1129(b) of the Bankruptcy Code,
as mutually agreed by EFIH and the Required EFIH Unsecured Consenting Creditors.
(f) Pursuant to the Commitment Letter, certain Holders of EFIH Unsecured Note Claims will

3

commit up to $1,900 million in cash, which shall be utilized to backstop the EFIH Second
Lien DIP Financing. On the Effective Date, EFIH Second Lien DIP Claims shall convert
on a Pro Rata basis to Reorganized EFH Common Stock issued and outstanding as of the
Effective Date pursuant to the Equity Conversion and the terms set forth in this Term
Sheet.
(g) Holders of General Unsecured Claims Against the EFIH Debtors will receive their Pro
Rata share of (i) 91% of the Participation Rights and (ii) on the Effective Date, 98% of the
Reorganized EFH Common Stock, subject to dilution on account of the Equity
Conversion.
(h) Holders of General Unsecured Claims Against EFH will receive their Pro Rata share of:
(i) the Equity Conversion; (ii) on the Effective Date, 1% of the Reorganized EFH
Common Stock, subject to dilution on account of the Equity Conversion; and (iii) on the
Effective Date, either: (A) if the Oncor TSA Amendment has been approved, (1)
$55 million in cash from EFIH, provided, however, that if the Oncor tax payments
received by EFIH under the Oncor TSA Amendment through the Effective Date are less
than 80% of the projected amounts set forth in this Term Sheet, the $55 million shall be
reduced dollar-for-dollar by such shortfall, and (2) cash on hand at EFH (not including the
settlement payment in clause (1) hereof); or (B) if the Oncor TSA Amendment has not
been approved, all EFH assets, including cash on hand and any Causes of Action, but
excluding Interests in EFIH.
(i) Holders of General Unsecured Claims Against EFH Debtors Other Than EFH shall
receive treatment in accordance with the priorities set forth in the Bankruptcy Code.
(j) Holders of EFH Interests will receive, on the Effective Date, their Pro Rata share of 1% of
the Reorganized EFH Common Stock, subject to dilution on account of the Equity
Conversion.

GENERAL PROVISIONS REGARDING THE EFIH RESTRUCTURING
EFIH First Lien
DIP Financing
Consistent with the Restructuring Support Agreement, EFIH will file a motion
(the EFIH First Lien DIP Motion) or, to the extent necessary, commence an
adversary proceeding to:
(a) seek approval of the EFIH First Lien DIP Financing on the terms set
forth in Exhibit G;
(b) repay in full all outstanding principal and accrued and unpaid interest
through consummation of the EFIH First Lien DIP Financing, at the
non-default rate due and owing under the EFIH First Lien Notes (which
shall not include any alleged premiums, fees or claims relating to the
repayment of such Claims), held by Non-Settling EFIH First Lien Note
Holders in cash from the proceeds of the EFIH First Lien DIP
Financing in full satisfaction of such Holders EFIH First Lien Note
Claims;
(c) exchange the EFIH First Lien Note Claims held by Settling EFIH First
Lien Note Holders (and EFIH Second Lien Note Claims electing such
treatment under the EFIH Second Lien Settlement, if any) for loans
under the EFIH First Lien DIP Financing in accordance with the terms
of the EFIH First Lien Settlement (and the EFIH Second Lien
Settlement); and

4

(d) obtain entry of an order or a judicial finding that no Allowed Claim
exists on account of EFIH First Lien Makewhole Claims held by Non-
Settling EFIH First Lien Note Holders.
EFIH First Lien
Settlement
Consistent with the Restructuring Support Agreement, EFIH shall file a motion
to:
(a) seek approval of a settlement with the Settling EFIH First Lien Note
Holders (the EFIH First Lien Settlement) on the terms set forth
below;
(b) provide EFIH First Lien Note Claims held by Fidelity, PIMCO, and
any other holders of EFIH First Lien Note Claims that are signatories
to the Restructuring Support Agreement as of the date of the EFIH First
Lien DIP Financing is consummated (such Holders, Settling EFIH
First Lien Note Holders) with, in connection with the EFIH First
Lien DIP Financing, and as payment in full of their EFIH First Lien
Note Claims, their Pro Rata share of an amount of loans under the
EFIH First Lien DIP Financing equal to the greater of: (i) (A) 105% of
the principal plus (B) 101% of accrued and unpaid interest at the non-
default rate on such principal, through consummation of the EFIH First
Lien DIP Financing (which amount shall be deemed to include the
original issue discount paid in respect of the EFIH First Lien DIP
Financing); and (ii) (A) 104% of the principal plus (B) accrued and
unpaid interest at the non-default rate on such principal, through
consummation of the EFIH First Lien DIP Financing, plus original
issue discount paid in respect of the EFIH First Lien DIP Financing, it
being understood that in connection with such loans, Settling EFIH
First Lien Note Holders shall be entitled to interest (in no event less
than LIBOR plus 3.25% with a LIBOR floor of 1.00%) in accordance
with the EFIH First Lien DIP Financing, but shall not be entitled to any
other fees (including commitment fees) paid in respect of the EFIH
First Lien DIP Financing; and
(c) seek approval of a commitment by PIMCO, in the amount of
$1.45 billion, and Fidelity or WAMCO if they elect to commit any
additional amounts set forth on such parties signature page to the
Restructuring Support Agreement (each, the Backstop Amount,
such Backstop Amount, collectively, the Backstop Commitment,
and such backstopping parties, the Backstop Parties) to provide
backstop EFIH First Lien DIP Financing (the Backstop Financing)
on the terms set forth below within five (5) calendar days of the date of
the Restructuring Support Agreement, it being understood that in
connection with such loans, the Backstop Parties shall be entitled to
interest (in no event less than LIBOR plus 3.25% with a LIBOR floor
of 1.00%) and original issue discount equal to the greater of (i) 1.00%
or such original issue discount as may be paid to other lenders in the
EFIH First Lien DIP Financing, and shall be restricted by the Clear
Market Provision set forth below, but shall be entitled to commitment
fees upon entry of final order consummating the EFIH First Lien DIP
Financing, in the following amounts: (i) 1.75%, if such Settling EFIH
First Lien Note Holders enter into a commitment by executing the

5

Restructuring Support Agreement before the petition is filed, or
(ii) 1.00%, if such Settling EFIH First Lien Note Holders enter into a
commitment by executing the Restructuring Support Agreement after
the petition is filed, paid in respect of such Backstop Financing, and a
ticking fee if and when one becomes payable to EFIH First Lien DIP
lenders, and with closing conditions as set forth in Exhibit I, and as
otherwise set forth in the EFIH First Lien DIP Financing. The
Backstop Financing shall be funded (x) first, by PIMCO in an amount
equal to the lesser of: (a) $768.871 million; or (b) (i) the maximum
possible amount of the First Lien Exchange Financing (i.e., assuming
all Holders of EFIH First Lien Note Claims participated in the EFIH
First Lien Settlement) less the actual amount of the First Lien
Exchange Financing at such time (the Unallocated First Lien
Exchange Capacity) plus (ii) an amount equal to $4,850 million less
the maximum possible amount of the First Lien Exchange Financing
(i.e., assuming all Holders of EFIH First Lien Note Claims participated
in the EFIH First Lien Settlement); provided, however, in such event,
any Backstop Financing funded in excess of the Unallocated First Lien
Exchange Capacity shall not be entitled to any commitment fees; (y)
second, by all Backstop Parties (on a pro rata basis based on each
Backstop Partys individual remaining unused Backstop Amount) in an
amount equal to the lesser of: (A) the remaining amount of the
Backstop Commitment, if any; and (B) the remaining amount of the
Unallocated First Lien Exchange Capacity, if any;
(d) seek approval of a commitment by GSO to fund $50 million on the
terms set forth in the EFIH First Lien DIP Financing, including original
issue discount, but not including commitment fees.
The EFIH First Lien Settlement shall be governed by the following principles:
(a) Eligibility. The EFIH First Lien Settlement may be offered or made
available, at EFIHs election, to other Holders of EFIH First Lien Note
Claims that sign the Restructuring Support Agreement; provided,
however, that any such offering shall (1) be completed within twenty-
five (25) business days after May 5, 2014 and (2) include a step-
down in the exchange rate applicable to the exchange on the tenth (10)
business day after the launch of such exchange (provided such step
down date can be extended by up to three (3) business days).
(b) Reservation of Rights. The EFIH First Lien Settlement shall in no
way affect EFIHs position with respect to Holders of EFIH First Lien
Note Claims that do not enter into the EFIH First Lien Settlement (such
holders, the Non-Settling EFIH First Lien Note Holders).
Accordingly, as to the Non-Settling EFIH First Lien Note Holders,
EFIH shall reserve all rights.
(c) Effect; Most Favored Nation. The EFIH First Lien Settlement shall
be binding on Settling EFIH First Lien Note Holders in all respects and
irrespective of the outcome of any litigation in respect of any other
EFIH First Lien Makewhole Claim; provided, however, that if EFIH
reaches one or more voluntary settlements with a Non-Settling EFIH

6

First Lien Note Holder in the period commencing on the Petition Date
and ending on the date on which the EFIH First Lien DIP Financing is
fully funded pursuant to a final order entered by the Bankruptcy Court,
which provides a higher percentage recovery to a Non-Settling EFIH
First Lien Note Holder does the EFIH First Lien Settlement, the EFIH
First Lien Settlement shall be automatically amended to provide such
higher percentage recovery to Fidelity and PIMCO, provided, further,
that if the EFIH First Lien DIP Financing shall have been
consummated by such date, such additional consideration may be in the
form of cash, at the election of EFIH.
(d) Clear Market Provision. The Clear Market Provision shall mean
the requirement that the Settling EFIH First Lien Note Holders not
syndicate or attempt to syndicate any portion of their commitment
under the DIP Facility, prior to the earlier of (x) the date that the
lenders under the EFIH First Lien DIP Financing no longer hold any of
the EFIH First Lien DIP Financing (i.e., successful syndication date)
and (y) in the event of an offering with respect to the EFIH First Lien
Settlement, the 25th day after the end of any early election period
given to the holders of the EFIH First Lien Notes Claims.
(e) Definitive Documentation. The final credit agreement consummating
the DIP Financing shall be in form and substance, in all material
respects, consistent with the draft credit agreement as modified by the
draft DIP Financing term sheet, each as attached to this Term Sheet,
and any material modification to such credit agreement (as modified by
such DIP Financing term sheet) shall be approved by PIMCO (such
approval not to be unreasonably withheld, delayed or
conditioned). The final order consummating the DIP Financing shall
be in form and substance reasonably acceptable in all material respects
to PIMCO.
EFIH Second Lien
DIP Financing
Consistent with the Restructuring Support Agreement, EFIH will file a motion
(the EFIH Second Lien DIP Motion) or, to the extent necessary, commence
an adversary proceeding to:
(a) seek approval of the EFIH Second Lien DIP Financing on the terms set
forth in Exhibit H in an amount up to $1,900 million;
(b) repay in full all outstanding principal plus accrued and unpaid interest
at the non-default rate, through consummation of the EFIH Second Lien
DIP Financing, due and owing under the EFIH Second Lien Notes
(which shall not include any alleged premiums, fees or claims relating
to the repayment of such Claims) to Non-Settling EFIH Second Lien
Note Holders in cash from proceeds of the EFIH Second Lien DIP
Financing and cash on hand at EFIH in full satisfaction of such
Holders EFIH Second Lien Note Claims; and
(c) repay the EFIH Second Lien Notes held by Settling EFIH Second Lien
Note Holders with cash on hand at EFIH, cash from the proceeds of the
EFIH Second Lien DIP Financing or, in the case of Fidelity, an
exchange for participation in the EFIH First Lien DIP Financing in
accordance with the terms of the EFIH Second Lien Settlement.

7

The Debtors will assert that no Allowed Claim exists on account of any alleged
premiums, fees or claims relating to the repayment of the EFIH Second Lien
Note Claims held by Non-Settling EFIH Second Lien Note Holders, but will
litigate such Claims at a later date in the Chapter 11 Cases.
On the Effective Date, the EFIH Second Lien DIP Claims shall be subject to the
Equity Conversion.
EFIH Second Lien
Settlement
Consistent with the Restructuring Support Agreement, EFIH shall file a motion
to:
(a) seek approval of a settlement with the Settling EFIH Second Lien Note
Holders (the EFIH Second Lien Settlement) on the terms set forth
below; and
(b) provide settling Holders of EFIH Second Lien Note Claims, which shall
include Fidelity, GSO, York, and Avenue and such other holders of the
EFIH Second Lien Note Claims that are signatories to the Restructuring
Support Agreement as of the date the EFIH Second Lien DIP Financing
is consummated (such Holders, the Settling EFIH Second Lien Note
Holders), as payment in full of their EFIH Second Lien Note Claims,
their Pro Rata share of (i) an amount in cash equal to principal plus
accrued but unpaid interest (including Additional Interest) on such
principal at the contract non-default rate through the date of
consummation of the EFIH Second Lien Settlement, plus (ii) 50% of the
aggregate amount of the EFIH Second Lien Makewhole Claims
calculated as of the date of consummation of the EFIH Second Lien
Settlement and calculated without inclusion of Additional Interest, plus
(iii) in the case of GSO, York, and Avenue, a settlement premium of
$1.57 million in cash in the aggregate; provided, however, (1) Fidelity
shall have the right to receive up to $500 million of its payment under
the EFIH Second Lien Settlement in the form of EFIH First Lien DIP
Financing to be implemented in a manner consistent with this Term
Sheet and reasonably acceptable to Fidelity, it being understood that in
connection with such loans, Fidelity shall be entitled to interest and
original issue discount, if any, in respect of the EFIH First Lien DIP
Financing plus a 1.75% commitment fee.
The EFIH Second Lien Settlement shall be governed by the following
principles:
(a) Eligibility. The EFIH Second Lien Settlement may be made available,
at EFIHs election, to other Holders of EFIH Second Lien Note Claims
that sign the Restructuring Support Agreement.
(b) Reservation of Rights. The EFIH Second Lien Settlement shall in no
way affect EFIHs position with respect to Holders of EFIH Second
Lien Note Claims that do not enter into the EFIH Second Lien
Settlement (such holders, the Non-Settling EFIH Second Lien Note
Holders). Accordingly, as to the Non-Settling EFIH Second Lien
Note Holders, EFIH shall reserve all rights.
(c) Effect; Most Favored Nation. The EFIH Second Lien Settlement shall
be binding on Settling EFIH Second Lien Note Holders in all respects
and irrespective of the outcome of any litigation in respect of any other

8

EFIH Second Lien Makewhole Claim; provided, however, that if EFIH
reaches one or more voluntary settlements with either: (i) a
Commitment Party or affiliate thereof on account of its EFIH Second
Lien Note Claims (whenever acquired) at any time prior to a judgment
on the merits on such Claims; or (ii) any other Non-Settling EFIH
Second Lien Note Holder at any time prior to the earlier of (x) the date
seven business days after the commencement of opening statements (or
the equivalent) in any trial on the merits of the Second Lien Makewhole
Claims and (y) the date upon which the Commitment Parties exercise
and consummate the Call Right, and any such settlements, determined
as of the final day of such period, provides a higher percentage recovery
than does the EFIH Second Lien Settlement, then the EFIH Second Lien
Settlement shall be automatically amended with respect to Fidelity to
provide such higher percentage recovery to Fidelity, in its capacity as
Settling EFIH Second Lien Note Holder; provided, further, that if the
EFIH First Lien DIP Financing shall have been consummated by either
such date, such additional consideration may be in the form of cash, at
the election of EFIH.
(d) Call Right. At any time before the Effective Date, any one or more
Commitment Parties shall have the right to purchase from Fidelity all of
its EFH Non-Guaranteed Notes for a purchase price equal to 37.15% of
par plus accrued and unpaid interest through the Petition Date (the Call
Right).
EFIH Second Lien
DIP Financing
Commitment
Pursuant to the terms and conditions of the Commitment Letter, certain Holders
of General Unsecured Claims Against the EFIH Debtors (the Commitment
Parties) have committed up to $1,900 million in available funds (the EFIH
Second Lien DIP Financing Commitment) which shall be utilized, in
accordance with and subject to the terms and conditions of the Commitment
Letter and related documentation, to backstop the EFIH Second Lien DIP
Financing, which shall, subject to the terms of the Conversion Agreement,
mandatorily convert into Reorganized EFH Common Stock pursuant to the
Equity Conversion.
The Commitment Letter is attached to the Restructuring Support Agreement as
Exhibit C.
The Participation Rights with respect to the EFIH Second Lien DIP Financing
shall be provided as follows:
(a) All Holders of EFIH Unsecured Note Claims shall receive their Pro
Rata share of 91% of the Participation Rights; and
(b) Fidelity, as a Holder of General Unsecured Claims of EFH, shall receive
9% of the Participation Rights and General Unsecured Claims Against
EFH shall receive a Pro Rata share of 9% of the Equity Conversion on
account of the Tranche A-3 Notes. Moreover, Fidelity shall receive an
$11.25 million payment from EFIH in connection with the exercise of
any of its Participation Rights. If at any time (a) the PLR Denial (as
defined in the Restructuring Support Agreement) has occurred and (b)
the Oncor TSA Amendment has not yet been approved, the Required
EFIH Unsecured Consenting Creditors shall have the sole and exclusive
right to require the Holders of any Tranche A-3 Notes to assign such

9

notes to the Commitment Parties for a purchase price equal to the sum
of (i) the par amount of such notes plus accrued and unpaid interest
(including the paid-in-kind interest), which amount shall be payable on
the purchase date, (ii) in the event such assignment is consummated
before the payment of the one-time payment-in-kind fee, 10% of the par
amount of such notes plus accrued and unpaid payment-in-kind interest,
if any (but not, for the avoidance of doubt, any accrued and unpaid cash
interest), which amount shall be payable on the purchase date, and (iii) a
Pro Rata share of any Prepayment Fee (as defined in the EFIH Second
Lien DIP Financing) subsequently paid on such Tranche A-3 Notes
(which amount shall be paid by EFIH to the holders of the Tranche A-3
Notes immediately prior to such assignment and not the holders of the
Tranche A-3 Notes as of the date that the Prepayment Fee is due and
owing) (Tranche A-3 Redemption).
The Debtors shall file a motion (the Approval Motion) to obtain entry of
(a) an order (the Approval Order) consistent with the Restructuring
Support Agreement, authorizing, among other things, (i) the EFIH First
Lien Settlement, (ii) the EFIH Second Lien Settlement, and (iii) EFH
and EFIH to perform their obligations under the Commitment Letter;
and
(b) an order (the Oncor TSA Amendment Order) consistent with the
Restructuring Support Agreement, authorizing the Oncor TSA
Amendment.
Oncor TSA
Amendment
Consistent with the Restructuring Support Agreement, the Approval Motion
shall also include a request for authority to amend, or otherwise assign the
payments under, the Oncor Tax Sharing Agreement (the Oncor TSA
Amendment) to provide that any payment required to be made to EFH under
the Oncor Tax Sharing Agreement after March 31, 2014, will instead be made to
EFIH. The Debtors agree to use commercially reasonable efforts to secure entry
of the Oncor TSA Amendment Order. Any tax payments received by EFH
before the Bankruptcy Court enters or denies the Oncor TSA Amendment Order
shall be deposited by EFH into a segregated account (the Segregated
Account) and shall not be disbursed until the earlier of (i) the date the
Bankruptcy Court enters the Oncor TSA Amendment Order, in which case, such
amounts shall be remitted to EFIH or (ii) the date the Bankruptcy Court denies
entry of the Oncor TSA Amendment Order, in which case, such amounts shall
be remitted to EFH. After entry of the Oncor TSA Amendment Order, EFIH
will reimburse EFH for cash taxes paid by EFH attributable to Oncor state taxes.
The Oncor TSA Amendment shall automatically terminate and be of no further
force and effect in the event that the Commitment Letter is terminated by the
Commitment Parties; provided, however, that any amounts that were paid to
EFIH in accordance with the Oncor TSA Amendment before its termination
shall be retained by EFIH if the Commitment Letter or EFIH Second Lien DIP
Financing terminates or is not fully funded in accordance with its terms (i.e.,
except as a result of a breach by the Commitment Parties). Neither EFH nor
EFIH shall have the right to terminate or modify the Oncor TSA Amendment
during the Chapter 11 Cases if the EFIH Second Lien DIP Financing is
consummated.

10

The collateral under the EFIH First Lien DIP Financing and the EFIH Second
Lien DIP Financing (if any) will include proceeds of payments under the Oncor
TSA Amendment, as long as the Oncor TSA Amendment remains in effect.
If the Bankruptcy Court has not approved the Oncor TSA Amendment 90 days
after the Petition Date, each Holder of EFIH Second Lien DIP Notes shall
receive, in accordance with the EFIH Second Lien DIP Financing, 4.0% of
additional interest with respect to the EFIH Second Lien DIP Notes, paid in kind
and compounded quarterly on account of such Holders EFIH Second Lien DIP
Claim, from the date that is 90 days after the Petition Date. If the Bankruptcy
Court do not approve the Oncor TSA Amendment by May 1, 2015, each Holder
of EFIH Second Lien DIP Notes shall receive, in accordance with the EFIH
Second Lien DIP Financing, a one-time 10.0% paid in kind fee on account of
such Holders EFIH Second Lien DIP Claim.
Private Letter
Ruling
Consistent with the Restructuring Support Agreement, EFH, on behalf of the
Debtors, shall file with the IRS a written request (the Ruling Request, and
together with all related materials and supplements thereto to be filed with the
IRS, the IRS Submissions) that the IRS issue a private letter ruling (the
Private Letter Ruling) to EFH that:
(a) will provide that the Contribution and the Distribution qualify as a
reorganization within the meaning of Sections 368(a)(1)(G), 355 and
356 of the Internal Revenue Code of 1986, as amended (the Code)
(collectively, the Intended Tax-Free Treatment); and
(b) will include each of the other requested rulings set forth in Part IV of
the Energy Future Holdings Corp. Pre-Submission Memorandum for
Rulings Under Section 368(a)(1)(G) and 355 in the form attached as
Exhibit E (the Pre-Submission Memo).
Collectively, the rulings described in clauses (a) and (b) are the Required
Rulings.
Prior to filing the Ruling Request, EFH shall use its reasonable best efforts to
arrange a pre-submission conference with the IRS (a Pre-Submission
Conference) by requesting such Pre-Submission Conference as soon as
reasonably practicable following the Petition Date. Such request must be made
within 5 business days of the Petition Date. For the avoidance of doubt, the Pre-
Submission Memo shall (a) request that the IRS provide, inter alia, the Required
Rulings, (b) constitute an IRS Submission and (c) be submitted to the IRS in
advance of the Pre-Submission Conference.
EFH shall be responsible for the preparation and filing of the IRS Submissions.
EFH shall provide tax counsel to the Consenting Creditors and Consenting
Interest Holders (the PLR Participation Parties) with a reasonable
opportunity to review and comment on drafts of all IRS Submissions filed on or
after the date of entry into the Restructuring Support Agreement; provided,
however, that such rights shall not result in unreasonable delays in submitting
the IRS Submissions to the IRS. No IRS Submission shall be filed without the
consent of the Required Consenting Creditors, which consent shall not be
unreasonably withheld or delayed. To the extent that EFH, in its good faith
judgment, considers any information included in such IRS drafts to be
confidential, EFH may require that any such documents provided to the PLR
Participation Parties be redacted to exclude such information, but tax counsel to

11

the PLR Participation Parties shall receive (and keep confidential) complete and
unredacted copies of any IRS Submission. Subject to the foregoing, EFH shall
provide the PLR Participation Parties with copies of each IRS Submission
promptly following the filing thereof.
EFH shall notify the PLR Participation Parties of any substantive
communications with the IRS regarding the IRS Submissions and the
Restructuring Transactions. Notwithstanding the foregoing, one representative
from each PLR Participation Party (a PLR Participation Party
Representative) shall (a) be given the opportunity to participate in all
scheduled communications with the IRS concerning the Ruling Request,
including all scheduled conference calls and in-person meetings (including the
Pre-Submission Conference); and (b) be updated in a timely fashion regarding
any unscheduled communications with the IRS. EFH and the PLR Participation
Parties agree to cooperate and use their commercially reasonable efforts to assist
in obtaining the Private Letter Ruling requested in the Ruling Request, including
providing such appropriate information and representations as the IRS shall
reasonably require in connection with the Required Rulings; provided, however,
that (i) the representations are consistent with, or not more burdensome to the
PLR Participation Parties than, those set forth in the Summary of Key
Representations, attached as Exhibit K, and (ii) providing such information and
representations does not restrict the liquidity of equity in Reorganized TCEH
after the Effective Date or the Claims of the PLR Participation Parties against
the Debtors prior to the Effective Date. Notwithstanding the foregoing, the
Debtors, the Consenting Creditors and the Consenting Interest Holders
acknowledge that certain of the Required Rulings set forth in the Pre-
Submission Memo address matters for which the IRS does not commonly issue
private letter rulings and, as a result, there is substantial uncertainty as to what
representations the IRS may require from the Debtors, the Consenting Creditors
and the Consenting Interest Holders. The Consenting Creditors and Consenting
Interest Holders agree to reasonably consider in good faith any representations
described in clause (i) above requested by the IRS in order to issue the Private
Letter Ruling.
Other than as set forth in this Term Sheet (including, for this purpose,
transactions described in the Pre-Submission Memo), the Debtors shall not take
any action to change the entity classification for U.S. federal income tax
purposes of any Debtor entity with material assets, by changing their legal form
or otherwise, without the consent of the Required EFIH Unsecured Consenting
Creditors, the Consenting Interest Holders, and the Ad Hoc TCEH Committee.

TREATMENT OF CLAIMS AND INTERESTS OF THE DEBTORS UNDER THE PLAN
Class No. Type of Claim Treatment Impairment / Voting
Unclassified Non-Voting Claims Against the Debtors
N/A
TCEH DIP
Claims

On the Effective Date, in full satisfaction of each
Allowed TCEH DIP Claim, each Holder thereof shall
receive (a) payment in full in cash or (b) such other less
favorable treatment for such Holder as may be agreed to
by such Holder and the TCEH Debtors.
N/A

12

N/A
EFIH First
Lien DIP
Claims
Allowed EFIH First Lien DIP Claim, each Holder thereof
shall receive payment in full in cash from the proceeds of
New Reorganized EFIH Debt or cash on hand at EFIH up
to the amount of such Holders Claim.
N/A
N/A
EFIH Second
Lien DIP
Claims

Allowed EFIH Second Lien DIP Claim, each Holder
thereof shall receive its Pro Rata share of Reorganized
EFH Common Stock in accordance with the terms of the
Equity Conversion (or cash with respect to the Fidelity
Repayment up to the amount of such Holders Claim).
N/A
N/A
Administrative
Claims

On the Effective Date, except to the extent that a Holder
of an Allowed Administrative Claim and the Debtor
against which such Allowed Administrative Claim is
asserted agree to less favorable treatment for such Holder,
each Holder of an Allowed Administrative Claim shall
receive, in full satisfaction of its Claim, payment in full in
cash.
N/A
N/A
Priority Tax
Claims

Except to the extent that a Holder of an Allowed Priority
Tax Claim and the Debtor against which such Allowed
Priority Tax Claim is asserted agree to less favorable
treatment for such Holder, each Holder of an Allowed
Priority Tax Claim shall receive, in full satisfaction of its
Claim, payments in cash in a manner consistent with
section 1129(a)(9)(C) of the Bankruptcy Code.
N/A
Classified Claims and Interests of the TCEH Debtors
Class A1
Other Secured
Claims against
TCEH Debtors

Allowed Other Secured Claim, each Holder thereof shall
receive, at the option of the applicable TCEH Debtor in
consultation with the Ad Hoc TCEH Committee:
(a) payment in full in cash; (b) delivery of the collateral
securing any such Claim and payment of any interest
required under section 506(b) of the Bankruptcy Code;
(c) Reinstatement of such Other Secured Claim; or
(d) other treatment rendering such Claim Unimpaired.
Unimpaired;
deemed to
accept.
Class A2
Other Priority
Claims against
TCEH Debtors
Allowed Other Priority Claim, each Holder thereof shall
receive payment in full in cash or other treatment
rendering such Claim Unimpaired.
Unimpaired;
deemed to
accept.
Class A3
TCEH First
Lien Secured
Claims
Allowed TCEH First Lien Secured Claim, each Holder
thereof shall receive its Pro Rata share of: (a) 100% of
the Reorganized TCEH Common Stock, subject to
dilution only from the Reorganized TCEH Management
Incentive Plan; and (b) 100% of the net cash proceeds
from the issuance of the New Reorganized TCEH Debt.
Impaired;
entitled to
vote.
Class A4
General
Unsecured
On the Effective Date, in full satisfaction of each Impaired;

13

Claims Against
the TCEH
Debtors

Allowed General Unsecured Claim Against the TCEH
Debtors, each Holder thereof shall receive its Pro Rata
share of the TCEH Unsecured Claim Fund.
entitled to
vote.
Class A5
TCEH Debtor
Intercompany
Claims
On the Effective Date, unless otherwise provided for
under the Plan, each TCEH Debtor Intercompany Claim
shall either be Reinstated or canceled and released as
mutually agreed by the TCEH Debtors and the Ad Hoc
TCEH Committee.
Impaired;
deemed to
reject or
Unimpaired;
deemed to
accept.
Class A6
Non-TCEH
Debtor
Intercompany
Claims
On the Effective Date, Non-TCEH Debtor Intercompany
Claims shall be canceled and released.
Impaired;
deemed to
reject.
Class A7
Interests in
TCEH Debtors
other than
TCEH and
EFCH
On the Effective Date, Interests in the TCEH Debtors
other than TCEH and EFCH shall either be Reinstated or
canceled and released as mutually agreed by the TCEH
Debtors and the Ad Hoc TCEH Committee.
Impaired;
deemed to
reject or
Unimpaired;
deemed to
accept
Class A8
Interests in
TCEH and
EFCH
On the Effective Date, Interests in TCEH and EFCH shall
be canceled and released in accordance with the Tax-Free
Spin-Off.
Impaired;
deemed to
reject.
Classified Claims and Interests of the EFIH Debtors
Class B1
Other Secured
Claims against
EFIH Debtors

receive, at the option of the applicable EFIH Debtor in
consultation with the Required EFIH Unsecured
Consenting Creditors: (a) payment in full in cash;
(b) delivery of collateral securing any such Claim and
payment of any interest required under section 506(b) of
the Bankruptcy Code; (c) Reinstatement of such Other
Secured Claim; or (d) other treatment rendering such
Claim Unimpaired.
Unimpaired;
deemed to
accept.
Class B2
Other Priority
Claims against
EFIH Debtors
Unimpaired;
deemed to
accept.
Class B3 EFIH First
Lien Note
Claims
Allowed EFIH First Lien Note Claim, and as mutually
agreed by EFIH and the Required EFIH Unsecured
Consenting Creditors, each Holder thereof shall receive
payment in full in cash or such other treatment as
permitted under section 1129(b) of the Bankruptcy Code.
Impaired;
entitled to
vote.
Class B4 EFIH Second
Lien Note
Claims
Allowed EFIH Second Lien Note Claim, and as mutually
agreed by EFIH and the Required EFIH Unsecured
Consenting Creditors, each Holder thereof shall receive
Impaired;
entitled to
vote.

14

payment in full in cash or such other treatment as
permitted under section 1129(b) of the Bankruptcy Code.
Class B5 General
Unsecured
Claims Against
the EFIH
Debtors
Allowed General Unsecured Claim Against the EFIH
Debtors, each Holder thereof shall receive its Pro Rata
share of 98% of the Reorganized EFH Common Stock,
subject to dilution on account of the Equity Conversion.
Impaired;
entitled to
vote.
Class B6
EFIH Debtor
Intercompany
Claims
On the Effective Date, unless otherwise provided in the
Plan, EFIH Debtor Intercompany Claims shall either be
Reinstated or canceled and released as mutually agreed
by the EFIH Debtors and the Required EFIH Unsecured
Impaired;
deemed to
reject or
Unimpaired;
deemed to
accept.
Class B7
Non-EFIH
Debtor
Intercompany
Claims
On the Effective Date, Non-EFIH Debtor Intercompany
Claims shall be canceled and released.
Impaired;
deemed to
reject.
Class B8
Interests in
EFIH Debtors
On the Effective Date, Interests in the EFIH Debtors shall
be Reinstated.
Unimpaired,
deemed to
accept.
Classified Claims and Interests of the EFH Debtors
Class C1
Other Secured
Claims against
EFH Debtors

receive, at the option of the applicable EFH Debtor in
consultation with the Required EFIH Unsecured
Consenting Creditors: (a) payment in full in cash;
(b) delivery of collateral securing any such Claim and
payment of any interest required under section 506(b) of
the Bankruptcy Code; (c) Reinstatement of such Other
Secured Claim; or (d) other treatment rendering such
Claim Unimpaired.
Unimpaired;
deemed to
accept.
Class C2
Other Priority
Claims against
EFH Debtors
Unimpaired;
deemed to
accept.
Class C3 Legacy
General
Unsecured
Claims Against
EFH
On the Effective Date, in full satisfaction of each Legacy
General Unsecured Claim Against EFH, each Holder
thereof shall receive: (a) payment in full in cash;
(b) Reinstatement; or (c) such other treatment rendering
such Claim Unimpaired.
Unimpaired;
deemed to
accept.
Class C4 General
Unsecured
Claims Against
EFH
Allowed General Unsecured Claim Against EFH, each
Holder thereof shall receive its Pro Rata share of: (a) 1%
of the Reorganized EFH Common Stock, subject to
dilution by the Equity Conversion; and (b) if the Oncor
TSA Amendment has been approved, (i) all Cash on hand
at EFH, not including the Oncor TSA Amendment
Impaired;
entitled to
vote.

15

Payment; and (ii) the Oncor TSA Amendment Payment;
or (b) if the Oncor TSA Amendment has not been
approved, the EFH Unsecured Claims Fund.
Class C5 General
Unsecured
Claims Against
the EFH
Debtors Other
Than EFH
Allowed General Unsecured Claim Against the EFH
Debtors Other Than EFH, each Holder thereof shall
receive treatment in accordance with the priorities set
forth in the Bankruptcy Code.
Impaired;
entitled to
vote.
Class C6
EFH Debtor
Intercompany
Claims
On the Effective Date, unless otherwise provided in the
Plan, EFH Debtor Intercompany Claims shall either be
Reinstated or canceled and released as mutually agreed
by the EFH Debtors, the Required EFIH Unsecured
Consenting Creditors, and Fidelity.
Impaired;
deemed to
reject or
Unimpaired;
deemed to
accept.
Class C7
Non-EFH
Debtor
Intercompany
Claims
On the Effective Date, Non-EFH Debtor Intercompany
Claims shall be canceled and released, provided that if
the Oncor TSA Amendment is not approved by the
Bankruptcy Court, each EFH-EFIH Intercompany Claim
shall not be canceled or released and shall receive its Pro
Rata share of the EFH Unsecured Claims Fund in full
satisfaction of such Claim.
Impaired;
deemed to
reject.
Class C8
Interests in
EFH Debtors
Other Than
EFH
On the Effective Date, Interests in the EFH Debtors other
than EFH shall either be Reinstated or canceled and
released in the EFH Debtors or Reorganized EFH
Debtors discretion.
Impaired;
deemed to
reject or
Unimpaired;
deemed to
accept.
Class C9 EFH Interests On the Effective Date, EFH Interests shall be Reinstated,
subject to dilution by the issuance of Reorganized EFH
Common Stock to Holders of General Unsecured Claims
Against the EFIH Debtors, Holders of General Unsecured
Claims Against the EFH Debtors, and the Equity
Conversion.
Impaired;
entitled to
vote.

GENERAL PROVISIONS REGARDING THE PLAN
Subordination The classification and treatment of Claims under the Plan shall conform
to the respective contractual, legal, and equitable subordination rights of
such Claims, and any such rights shall be settled, compromised, and
released pursuant to the Plan.
Restructuring Transactions The Confirmation Order shall be deemed to authorize, among other
things, all actions as may be necessary or appropriate to effect any
transaction described in, approved by, contemplated by, or necessary to
effectuate the Plan, including the Tax-Free Spin-Off.
Tax-Free Spin-Off To preserve the Intended Tax-Free Treatment of the Restructuring
Transactions and conditioned upon the receipt of the Private Letter
Ruling with the Required Rulings, the Debtors shall undertake the Tax-

16

Free Spin-Off as follows:
(a) before the Effective Date, TCEH shall form a new subsidiary in
the form of a limited liability company under the laws of
Delaware (Reorganized TCEH);
(b) on the Effective Date, the Claims against TCEH will be canceled
in exchange for each Holders right to receive its recovery in
accordance with the terms of the Plan;
(c) immediately following such cancellation, TCEH shall transfer
all of its assets and its ordinary course operating liabilities, and
the Debtors shall transfer assets and liabilities related to the
Shared Services, to Reorganized TCEH (the Contribution) in
exchange for which TCEH shall receive (i) 100% of the newly
issued Reorganized TCEH equity interests and (ii) the cash
proceeds of the New Reorganized TCEH Debt, subject to
preserving the Intended Tax-Free Treatment of the
Restructuring Transactions. For the avoidance of doubt, no
funded debt of TCEH, including the TCEH First Lien Claims,
TCEH Second Lien Note Claims, and TCEH Unsecured Note
Claims will be assumed by Reorganized TCEH pursuant to the
Contribution (as all such Claims will have been canceled
immediately prior to the transfer of assets to Reorganized
TCEH);
(d) immediately following the Contribution, Reorganized TCEH
shall convert into a Delaware corporation; and
(e) immediately following such conversion, TCEH shall distribute
all of the Reorganized TCEH Common Stock it holds and the
cash received from Reorganized TCEH to the Holders of TCEH
First Lien Claims (the Distribution).

EFHs earnings and profits will be allocated between Reorganized EFH
and Reorganized TCEH pursuant to Treasury Regulations Section
1.312-10(a) in proportion to the fair market value of the business or
businesses (and interests in any other properties) retained by Reorganized
EFH and the business or businesses (and interests in any other properties)
of Reorganized TCEH immediately after the Distribution. For purposes
of determining their relative fair market values and shares of earnings and
profits, the valuation of Reorganized TCEH and Reorganized EFH shall
be made, to the extent permitted by law, immediately following the
distribution of Reorganized TCEH and prior to (i) Holders of EFIH and
EFH General Unsecured Claims receiving Reorganized EFH Common
Stock, and (ii) the conversion of EFIH Second Lien DIP into Reorganized
EFIH Common Stock, provided that to the extent required under the
Private Letter Ruling, an amount of EFIH and EFH General Unsecured
Claims, if any, required to cause Reorganized EFH to be solvent at such
time shall be deemed exchanged for Reorganized EFH Common Stock.
Tax Basis of Reorganized
TCEH
Immediately following the Distribution, the aggregate tax basis, for U.S.
federal income tax purposes, of the assets held by Reorganized TCEH
shall be equal to the sum of (x) TCEHs aggregate tax basis, for U.S.
federal income tax purposes, in the assets it transfers to Reorganized
TCEH pursuant to the Contribution plus (y) 95% of the aggregate amount

17

of deductions, net operating losses and capital losses (including
carryforwards) available to the EFH consolidated group as of the
Effective Date (determined (i) as if the EFH consolidated tax year ended
on the Effective Date and (ii) without regard to any gain or income
generated as a result of the Contribution), in each case as determined by
the Debtors in good faith and in consultation with the Ad Hoc TCEH
Committee no later than 60 days prior to the Effective Date (the amount
set forth in clause (y), the Basis Step-Up, and the sum of clauses (x)
and (y), the Minimum Basis).
After the Petition Date, the Debtors shall continue to operate their
business in the ordinary course and shall not take any actions (other than
as set forth in this Term Sheet) outside the ordinary course of business
that will materially increase the taxable income of the EFH consolidated
group (excluding any taxable income generated by TCEH and its
subsidiaries) during the period from the Petition Date through the
Effective Date.
Tax Matters Agreement
Reorganized EFH and Reorganized TCEH shall enter into a Tax Matters
Agreement as of the Effective Date that shall govern the rights and
obligations of each party with respect to certain tax matters.
Specifically, the Tax Matters Agreement will address:
(a) the filing of tax returns by Reorganized EFH and Reorganized
TCEH;
(b) tax indemnification obligations of Reorganized EFH and
Reorganized TCEH;
(c) the conduct of tax proceedings by Reorganized EFH and
Reorganized TCEH; and
(d) representations, warranties, and covenants with respect to the
Intended Tax-Free Treatment of the Contribution and
Distribution.
The Tax Matters Agreement will provide that:
(i) Reorganized TCEH will indemnify Reorganized EFH for (x)
income taxes imposed on Reorganized EFH attributable solely to
a failure of the Tax-Free Spin-Off to qualify for the Intended
Tax-Free Treatment as a result of a breach of one or more
covenants (following the Distribution) by Reorganized TCEH,
(y) any alternative minimum tax (A) arising from the resolution
of IRS audits for periods (or portions thereof) ending on or
before the Effective Date attributable to any business contributed
to Reorganized TCEH or its subsidiaries, but in no event to
exceed $15 million and (B) arising as a result of the utilization
of NOL carryforwards to offset gain related to the portion (if
any) of the Basis Step-Up in excess of $1.9 billion and (z)
ordinary course non-income taxes for periods (or portions
thereof) ending on or before the Effective Date attributable to
any business contributed to Reorganized TCEH or its
subsidiaries (but only to the extent such taxes are, consistent
with past practice, payable by Reorganized TCEH, TCEH or its

18

subsidiaries); and
(ii) Reorganized EFH will indemnify Reorganized TCEH for taxes
that are not specifically covered by clause (i), including, without
duplication, (w) taxes attributable to any business retained by
Reorganized EFH or its subsidiaries, (x) EFH and Reorganized
EFHs consolidated U.S. federal income taxes (and any
affiliated, consolidated, combined, unitary, aggregate or similar
state or local taxes), and (y) income taxes attributable to a failure
of the Tax-Free Spin-Off to qualify for the Intended Tax-Free
Treatment (except as described in clause (i) above); provided,
however, that Reorganized EFH will be responsible for income
taxes attributable to such failure only if such failure is as a result
of the breach of any covenant by EFH or Reorganized EFH
hereunder. Nothing herein shall be interpreted to mean that any
party other than EFH or Reorganized EFH shall be primarily
liable for any taxes imposed on a failure of the Tax-Free Spin-
Off to qualify for the Intended Tax-Free Treatment, except to the
extent that such failure is as a result of the breach of any
covenant by Reorganized TCEH as provided in clause (i)
hereunder.
The Tax Matters Agreement will prohibit Reorganized EFH and
Reorganized TCEH from taking those actions (or refraining from taking
those actions) that are set forth below:
For two years after the Distribution, Reorganized TCEH,
Reorganized EFH, and Reorganized EFIH will not be permitted
to:
cease, or permit its wholly-owned subsidiaries listed on
Exhibit D to cease, the active conduct of a business that was
conducted immediately prior to the Distribution or from
holding certain assets held at the time of the Distribution;
dissolve, liquidate, take any action that is a liquidation for
federal income tax purposes or permit its wholly-owned
subsidiaries listed on Exhibit D from doing any of the
foregoing;
redeem or repurchase any of its equity if such redemption or
repurchase could reasonably be expected to adversely impact
the continuity of interest requirement set forth in Treas. Reg.
Section 1.368-1(e) or 1.355-2(c)(1); and
merge with or into another corporation with such other
corporation surviving in a transaction that does not qualify as
a reorganization under Section 368(a).
For the avoidance of doubt, the Tax Matters Agreement shall contain no
express or implied limitation on the transferability or issuance of the
stock of Reorganized EFH or Reorganized TCEH following the Effective
Date.
Nevertheless, Reorganized TCEH, Reorganized EFH, and Reorganized
EFIH will be permitted to take any of the actions described above if
Reorganized EFH obtains a supplemental IRS private letter ruling (or an

19

opinion of counsel that is reasonably acceptable to Reorganized EFH and
Reorganized TCEH) to the effect that the action will not affect the
Intended Tax-Free Treatment of the Restructuring Transactions.
Reorganized TCEH and/or Reorganized EFIH can require that
Reorganized EFH seek such a supplemental IRS private letter ruling or
opinion of counsel if Reorganized EFH does not seek one on its own.
The Tax Matters Agreement shall otherwise be in form and substance
acceptable to the Debtors, the Required EFIH Unsecured Consenting
Creditors and the Ad Hoc TCEH Committee.
Shared Services Except as otherwise agreed by Reorganized TCEH, Reorganized EFH,
and the Ad Hoc TCEH Committee, the TCEH Debtors and the EFH
Debtors will transfer to Reorganized TCEH or its designee all operating
assets, including executory contracts and liabilities owned by or asserted
against the EFH Debtors, that are reasonably necessary to the continued
operation of Reorganized TCEH (the Shared Services) and that are not
otherwise discharged, in exchange for the rights and benefits provided
under the Plan, Restructuring Support Agreement, Term Sheet, and
related commitments and settlements (which, for the avoidance of doubt,
will not require Reorganized TCEH or the TCEH Debtors to make any
cash payments to the EFH Debtors or Reorganized EFH Debtors);
provided, however, Reorganized TCEH will cure and pay any and all
amounts due and owing with respect to the Shared Services as of the
Effective Date to the extent such payments are authorized pursuant to the
Cash Management Order; provided, further, that employees of EFH and
EFH Corporate Services must be transferred to Reorganized TCEH;
provided, further, that Reorganized EFH shall retain liability, if any, for
the Legacy General Unsecured Claims.
The TCEH Debtors, the EFIH Debtors, the EFH Debtors, the Required
EFIH Unsecured Consenting Creditors and the Ad Hoc TCEH Committee
will negotiate in good faith to reach an agreement on mutually acceptable
terms regarding transition services reasonably necessary to the continued
operation of Reorganized EFIH and/or Reorganized EFH relating to the
foregoing assets, employees, executory contracts, and operating
liabilities.
Termination of Competitive
Tax Sharing Agreement
On the Effective Date, the Competitive Tax Sharing Agreement shall
automatically terminate and all Claims and Causes of Action arising
thereunder or in any way related thereto shall be forever discharged,
cancelled and released.
Cancellation of Notes,
Instruments, Certificates,
and Other Documents
On the Effective Date, except to the extent otherwise provided in this
Term Sheet or the Plan, all notes, instruments, certificates, and other
documents evidencing Claims or Interests, including credit agreements
and indentures, shall be canceled and the obligations of the Debtors
thereunder or in any way related thereto shall be deemed satisfied in full
and discharged.
Issuance of New Securities;
Execution of the Plan
Restructuring Documents
On the Effective Date, the Debtors, as applicable, shall issue all
securities, notes, instruments, certificates, and other documents required
to be issued pursuant to the Restructuring, including the Plan
Restructuring Documents.

20

Executory Contracts and
Unexpired Leases
Except as otherwise provided in this Term Sheet, the Plan will provide for
the Debtors, in consultation with the Ad Hoc TCEH Committee and the
Required EFIH Unsecured Consenting Creditors, to assume or reject, as
the case may be, executory contracts and unexpired leases identified in
the Plan Supplement to the extent that any such executory contracts and
unexpired leases have not been otherwise assumed or rejected.
Resolution of Contested
Claims
The Plan will provide for the resolution of Contested Claims.
Retention of Jurisdiction The Plan will provide for the retention of jurisdiction by the Bankruptcy
Court for usual and customary matters.
Discharge of Claims and
Termination of Interests
Pursuant to section 1141(d) of the Bankruptcy Code, and except as
otherwise specifically provided in the Plan or in any contract, instrument,
or other agreement or document created pursuant to the Plan, the
distributions, rights, and treatment that are provided in the Plan shall be in
complete satisfaction, discharge, and release, effective as of the Effective
Date, of Claims (including any Intercompany Claims resolved or
compromised after the Effective Date by the Reorganized Debtors),
Interests, and Causes of Action of any nature whatsoever, including any
interest accrued on Claims or Interests from and after the Petition Date,
whether known or unknown, against, liabilities of, liens on, obligations
of, rights against, and Interests in, the Debtors or any of their assets or
properties, regardless of whether any property shall have been distributed
or retained pursuant to the Plan on account of such Claims and Interests,
including demands, liabilities, and Causes of Action that arose before the
Effective Date, any liability (including withdrawal liability) to the extent
such Claims or Interests relate to services performed by employees of the
Debtors prior to the Effective Date and that arise from a termination of
employment, any contingent or non-contingent liability on account of
representations or warranties issued on or before the Effective Date, and
all debts of the kind specified in sections 502(g), 502(h), or 502(i) of the
Bankruptcy Code, in each case whether or not: (a) a Proof of Claim
based upon such debt or right is filed or deemed filed pursuant to section
501 of the Bankruptcy Code; (b) a Claim or Interest based upon such
debt, right, or Interest is Allowed pursuant to section 502 of the
Bankruptcy Code; or (c) the Holder of such a Claim or Interest has
accepted the Plan. The Confirmation Order shall be a judicial
determination of the discharge of all Claims and Interests subject to the
Effective Date occurring.
Releases by the Debtors Pursuant to section 1123(b) of the Bankruptcy Code, and except as
otherwise specifically provided in any order resolving a Cause of Action
that is entered in a proceeding of the sort described in Section 4.01(c) of
the Restructuring Support Agreement, for good and valuable
consideration, on and after the Effective Date, each Released Party is
deemed released and discharged by the Debtors, the Reorganized
Debtors, and their Estates from any and all Causes of Action, including
any derivative claims, asserted on behalf of the Debtors, that the Debtors,
the Reorganized Debtors, or their Estates would have been legally entitled
to assert in their own right (whether individually or collectively) or on
behalf of the Holder of any Claim against, or Interest in, a Debtor or other

21

Entity, based on or relating to, or in any manner arising from, in whole or
in part, the Debtors, the Debtors in- or out-of-court restructuring efforts,
intercompany transactions, the Liability Management Program, the Tax
Sharing Agreements, the 2007 Acquisition, the Chapter 11 Cases, the
formulation, preparation, dissemination, negotiation, or filing of the
Restructuring Support Agreement, this Term Sheet, the Disclosure
Statement, the Plan, or any Restructuring Transaction, contract,
instrument, release, or other agreement or document created or entered
into in connection with the Restructuring Support Agreement, this Term
Sheet, the Disclosure Statement, or the Plan, the filing of the Chapter 11
Cases, the pursuit of Confirmation, the pursuit of Consummation, the
administration and implementation of the Plan, including the issuance or
distribution of securities pursuant to the Plan, or the distribution of
property under the Plan or any other related agreement, or upon any other
act or omission, transaction, agreement, event, or other occurrence taking
place on or before the Effective Date, other than claims or liabilities
arising out of or relating to any act or omission of a Released Party that is
determined in a final order to have constituted actual fraud or gross
negligence. Notwithstanding anything to the contrary in the foregoing,
the releases set forth above do not release any post-Effective Date
obligations of any party or Entity under the Plan, any Restructuring
Transaction, or any document, instrument, or agreement (including those
set forth in the Plan Supplement) executed to implement the Plan.
Releases by Holders of
Claims and Interests of the
Debtors
As of the Effective Date, and except as otherwise specifically provided in
any order resolving a Cause of Action that is entered in a proceeding of
the sort described in Section 4.01(c) of the Restructuring Support
Agreement, each Releasing Party is deemed to have released and
discharged each Debtor, Reorganized Debtor, and Released Party from
any and all Causes of Action, including any derivative claims, asserted on
behalf of the Debtors, that such Entity would have been legally entitled to
assert (whether individually or collectively), based on or relating to, or in
any manner arising from, in whole or in part, the Debtors, the Debtors
in- or out-of-court restructuring efforts, intercompany transactions, the
Liability Management Program, the Tax Sharing Agreements, the 2007
Acquisition, the Chapter 11 Cases, the formulation, preparation,
dissemination, negotiation, or filing of the Restructuring Support
Agreement, this Term Sheet, the Disclosure Statement, the Plan, or any
Restructuring Transaction, contract, instrument, release, or other
agreement or document created or entered into in connection with the
Restructuring Support Agreement, this Term Sheet, the Disclosure
Statement, or the Plan, the filing of the Chapter 11 Cases, the pursuit of
Confirmation, the pursuit of Consummation, the administration and
implementation of the Plan, including the issuance or distribution of
securities pursuant to the Plan, or the distribution of property under the
Plan or any other related agreement, or upon any other act or omission,
transaction, agreement, event, or other occurrence taking place on or
before the Effective Date, other than claims or liabilities arising out of or
relating to any act or omission of a Debtor, Reorganized Debtor, or
Released Party that is determined in a final order to have constituted
actual fraud or gross negligence. Notwithstanding anything to the
contrary in the foregoing, the releases set forth above do not release any

22

post-Effective Date obligations of any party or Entity under the Plan, any
Restructuring Transaction, or any document, instrument, or agreement
(including those set forth in the Plan Supplement) executed to implement
the Plan.
Exculpation Except as otherwise specifically provided in the Plan, no Exculpated
Party shall have or incur, and each Exculpated Party is hereby released
and exculpated from any Cause of Action for any claim related to any act
or omission in connection with, relating to, or arising out of, the Chapter
11 Cases, the formulation, preparation, dissemination, negotiation, or
filing of the Restructuring Support Agreement and related prepetition
transactions, the Disclosure Statement, the Plan, or any Restructuring
Transaction, contract, instrument, release or other agreement or document
created or entered into in connection with the Disclosure Statement or the
Plan, the filing of the Chapter 11 Cases, the pursuit of Confirmation, the
pursuit of Consummation, the administration and implementation of the
Plan, including the issuance of securities pursuant to the Plan, or the
distribution of property under the Plan or any other related agreement,
except for claims related to any act or omission that is determined in a
final order to have constituted actual fraud or gross negligence, but in all
respects such Entities shall be entitled to reasonably rely upon the advice
of counsel with respect to their duties and responsibilities pursuant to the
Plan. The Exculpated Parties have, and upon completion of the Plan shall
be deemed to have, participated in good faith and in compliance with the
applicable laws with regard to the solicitation of, and distribution of,
consideration pursuant to the Plan and, therefore, are not, and on account
of such distributions shall not be, liable at any time for the violation of
any applicable law, rule, or regulation governing the solicitation of
acceptances or rejections of the Plan or such distributions made pursuant
to the Plan.
Injunctions Except as otherwise expressly provided in the Plan or for obligations
issued or required to be paid pursuant to the Plan or the Confirmation
Order, all Entities who have held, hold, or may hold claims or interests
that have been released, discharged, or are subject to exculpation are
permanently enjoined, from and after the Effective Date, from taking any
of the following actions against, as applicable, the Debtors, Reorganized
Debtors, or the Released Parties: (a) commencing or continuing in any
manner any action or other proceeding of any kind on account of or in
connection with or with respect to any such claims or interests;
(b) enforcing, attaching, collecting, or recovering by any manner or
means any judgment, award, decree, or order against such Entities on
account of or in connection with or with respect to any such claims or
interests; (c) creating, perfecting, or enforcing any encumbrance of any
kind against such Entities or the property or the estates of such Entities on
interests; (d) asserting any right of setoff, subrogation, or recoupment of
any kind against any obligation due from such Entities or against the
property of such Entities on account of or in connection with or with
respect to any such claims or interests unless such Holder has filed a
motion requesting the right to perform such setoff on or before the
Effective Date, and notwithstanding an indication of a claim or interest or
otherwise that such Holder asserts, has, or intends to preserve any right of

23

setoff pursuant to applicable law or otherwise; and (e) commencing or
continuing in any manner any action or other proceeding of any kind on
interests released or settled pursuant to the Plan.

OTHER MATERIAL PROVISIONS REGARDING THE RESTRUCTURING
TCEH DIP Financing The TCEH Debtors Chapter 11 Cases shall be funded with the proceeds of
the TCEH DIP Financing and the Consenting TCEH First Lien Creditors
consent to use of cash collateral and priming by the TCEH DIP Financing on
the terms set forth in the TCEH Cash Collateral Order.
EFIH DIP Financing The EFIH Debtors Chapter 11 Cases shall be funded with the proceeds of
the EFIH First Lien DIP Financing and the EFIH Second Lien DIP
Financing. EFIH will seek authority to use the cash collateral of Holders of
EFIH First Lien Note Claims and EFIH Second Lien Note Claims and to
prime such Holders with the EFIH First Lien DIP Financing on the terms set
forth on Exhibit G.
Customer Obligations The Debtors shall honor all of their ordinary course customer obligations
during the course of the Restructuring.
Use of EFH and EFIH
Cash During Chapter 11
Cases
Unless otherwise agreed by EFH, EFIH, and the Required EFIH Unsecured
Consenting Creditors, during the Chapter 11 Cases, EFH and EFIH shall
only make payments, including professional fees, in the ordinary course of
business consistent with prepetition practices based on benefit to their
respective estates, including to each other under the EFIH Shared Services
Agreement, as approved pursuant to first day motions in the Chapter 11
Cases, or as otherwise set forth in the Term Sheet; provided, however, that
EFIH shall be entitled to enter into voluntary settlements from time to time
with (i) Non-Settling First Lien Note Holders on economically equal terms
to, or terms more favorable to the Estates than, the EFIH First Lien
Settlement, so long as, except with respect to the EFIH First Lien Settlement,
such terms provide for a settlement at no more than 102.25% of the principal
amount of such Holders EFIH First Lien Notes; and, (ii) with the consent of
the Required EFIH Unsecured Consenting Creditors, Non-Settling Second
Lien Note Holders on economically equal terms, or terms more favorable to
the Estates than the EFIH Second Lien Settlement, except that such consent
shall not be required with respect to the EFIH Second Lien Settlement.
Excess EFIH Cash Upon
Consummation
The Required EFIH Unsecured Consenting Creditors shall, in consultation
with EFH and EFIH, determine before the Effective Date how the Excess
EFIH Cash will be used on and after the Effective Date.
Allocation of
Professional Fees
Any professional fees (the Professional Fees) incurred by professionals
retained by the Debtors (the Debtors Professionals) shall be allocated to,
and paid by, the applicable Debtors for whose direct benefit such
Professional Fees were incurred (the Direct Benefit Fees). To the extent a
Professional Fee is incurred for the collective benefit of the EFH Debtors,
EFIH Debtors, and TCEH Debtors (the Collective Benefit Fees), such
Professional Fees shall be allocated to each Debtor in the same proportion
that the amount of Direct Benefit Fees incurred by such Debtors
Professional for such Debtor bears to the total amount of Direct Benefit Fees
incurred by such Debtors Professional for all of the Debtors, on a monthly

24

basis in connection with the Debtors Professionals fee application (the
Collective Fee Allocation). In connection with any quarterly/interim or
final applications for payment of Professional Fees, the Debtors shall, as
amongst themselves, make any necessary intercompany transfers or other
adjustments such that the total Collective Benefit Fees for each of the
Debtors Professionals for the applicable fee period is allocated in a manner
consistent with the Collective Fee Allocation for such period.
Any professional fees incurred by professionals retained by Fidelity for
which the Debtors have agreed to become liable shall be allocated on the
following basis: (a) 50% to the EFH Debtors and (b) 50% to the EFIH
Debtors. Any professional fees incurred by professionals retained by the
Commitment Parties for which the Debtors have agreed to become liable
shall be allocated 100% to the EFIH Debtors. Any professional fees incurred
by professionals retained by Holders of EFH Interests (together with the
Professional Fees incurred by the Debtors Professionals and all professional
fees discussed in this paragraph, the Total Professional Fees) for which
the Debtors have agreed to become liable shall be allocated 100% to the
EFH Debtors.
On the Effective Date, the first $7.5 million of the Total Professional Fees
that would have otherwise been allocated to the EFH Debtors on the terms as
set forth above shall instead be allocated to EFIH.
After the Petition Date, all payment of Professional Fees, including any
allocation formula, shall be subject to any applicable orders of the
Bankruptcy Court (on an interim or final basis).
Incentive Plans The Ad Hoc TCEH Committee and the Required EFIH Unsecured
Consenting Creditors shall negotiate in good faith with the TCEH Debtors,
the EFH Debtors, and the EFIH Debtors regarding the terms of key
employee incentive plans for which the Debtors shall seek approval from the
Bankruptcy Court during the Chapter 11 Cases.
Employment
Obligations
Pursuant to the Restructuring Support Agreement and this Term Sheet, the
Consenting Creditors consent to each of the Debtors first day or second
day motions relating to wages, compensation, and benefits, including
executive compensation programs. After the Effective Date, the
Reorganized Debtors wages, compensation, and benefit programs shall be
acceptable, in the case of Reorganized TCEH, to the TCEH Debtors and the
Ad Hoc TCEH Committee and, in the case of Reorganized EFH, to the EFH
Debtors and the Required EFIH Unsecured Consenting Creditors.
Additionally, employees who are party to employment agreements with
the Debtors may receive new employment agreements with the
applicable Reorganized Debtor, the terms and conditions of which shall
be acceptable, in the case of Reorganized TCEH, to the TCEH Debtors and
the Ad Hoc TCEH Committee and, in the case of Reorganized EFH, to the
EFH Debtors and the Required EFIH Unsecured Consenting Creditors. Until
such time as these new employment agreements are fully executed, all
employment agreements in place as of the Petition Date between the Debtors
and their employees shall remain in place in accordance with the terms of
such agreements pending the applicable Debtors assumption or rejection of
such agreements.

25

Indemnification of
Prepetition Directors,
Officers, Managers, et
al.
Under the Restructuring, consistent with applicable law, all indemnification
provisions currently in place (whether in the by-laws, certificates of
incorporation or formation, limited liability company agreements, other
organizational documents, board resolutions, indemnification agreements,
employment contracts, or otherwise) for the current and former directors,
officers, managers, employees, attorneys, accountants, investment bankers,
and other professionals of the Debtors, as applicable, shall be reinstated and
remain intact and irrevocable and shall survive the effectiveness of the
Restructuring. For the avoidance of doubt, the TCEH Debtors and
Reorganized TCEH shall not have any liability for, or any obligations in
respect of, any indemnification provisions for the benefit of the current and
former directors, officers, managers, employees, attorneys, accountants,
investment bankers, and other professionals of the EFH Debtors or the EFIH
Debtors, in their capacities as such and the EFH Debtors and Reorganized
EFH shall not have any liability for, or any obligations in respect of, any
indemnification provisions for the benefit of the current and former directors,
officers, managers, employees, attorneys, accountants, investment bankers,
and other professionals of the TCEH Debtors, in their capacities as such.
Director, Officer,
Manager, and Employee
Tail Coverage
On or before the Effective Date, the Debtors shall purchase and maintain
directors, officers, managers, and employee liability tail coverage for the
six-year period following the Effective Date on terms no less favorable than
the Debtors existing director, officer, manager, and employee coverage and
with an available aggregate limit of liability upon the Effective Date of no
less than the aggregate limit of liability under the existing director, officer,
manager, and employee coverage upon placement; provided, however, that
the costs of such policies shall be reasonably allocated among the Debtors in
a manner reasonably acceptable to Required Consenting Creditors.
Claims of the Debtors The Reorganized Debtors, as applicable, shall retain all rights to commence
and pursue any Causes of Action, other than any Causes of Action released
by the Debtors pursuant to the release and exculpation provisions outlined in
this Term Sheet.
Conditions Precedent to
Restructuring
The following shall be conditions to Consummation of the Restructuring (the
Conditions Precedent):
(a) the Debtors shall have consummated the EFIH First Lien DIP
Financing;
(b) the Debtors shall have consummated the EFIH Second Lien DIP
Financing and the Equity Conversion in accordance with the
Commitment Letter;
(c) the Debtors shall have consummated the EFIH First Lien Settlement
and the EFIH Second Lien Settlement in accordance with this Term
Sheet;
(d) the Debtors shall have obtained entry of the Approval Order, which
order shall be in full force and effect and not subject to a stay;
(e) Holders of EFH Non-Guaranteed Notes shall have received not less
than 37.15% on account of such Claims under to the Plan, which
condition is waivable only by Fidelity as holder of a majority of the
EFH Non-Guaranteed Notes on a personal and non-transferable

26

basis, and ceases at any time Fidelity holds less than a majority of
the EFH Notes;
(f) immediately following the Distribution, the aggregate tax basis, for
federal income tax purposes, of the assets held by Reorganized
TCEH shall be equal to the Minimum Basis and the Basis Step-Up
shall be no less than $2.1 billion;
(g) the Debtors shall have obtained all authorizations, consents,
regulatory approvals, rulings, or documents that are necessary to
implement and effectuate the Plan, including from the FERC, the
NRC, and the PUC, as applicable; provided, however, that the PUC
Regulatory Approval shall not be required to implement and
effectuate the Plan as to the TCEH Debtors;
(h) the Debtors shall have obtained the Private Letter Ruling from the
IRS, which shall be in form and substance acceptable to the Required
Consenting Creditors and shall include, inter alia, the Required
Rulings;
(i) the Debtors shall have entered into the Tax Matters Agreement,
which shall be in form and substance acceptable to the Required
Consenting Creditors;
(j) other than as set forth in this Term Sheet (including, for this purpose,
transactions described in the Pre-Submission Memo), the Debtors
shall not have taken any action to change the entity classification for
U.S. federal income tax purposes of any Debtor entity with material
assets, by changing their legal form or otherwise, without the consent
of the Required EFIH Unsecured Consenting Creditors and the Ad
Hoc TCEH Committee; provided that the consent of the Ad Hoc
TCEH Committee shall not be required with respect to the foregoing
if such action by EFH, EFIH, or the Required EFIH Unsecured
Consenting Creditors does not directly impact the TCEH
Contribution and Distribution and does not prevent EFH from
obtaining the Required Rulings; provided, further, that the consent of
the Required EFIH Unsecured Consenting Creditors shall not be
required with respect to the foregoing if such action by TCEH or the
Ad Hoc TCEH Committee does not prevent EFH from obtaining the
Required Rulings;
(k) the final version of the Plan Supplement and all of the schedules,
documents, and exhibits contained therein shall have been filed in a
manner consistent in all material respects with the Restructuring
Support Agreement, this Term Sheet, and the Plan;
(l) the Restructuring Support Agreement shall remain in full force and
effect;
(m) all professional fees and expenses approved by the Bankruptcy Court
shall have been paid in full or amounts sufficient to pay such fees
and expenses after the Effective Date have been placed in a
professional fee escrow pending approval by the Bankruptcy Court;
(n) the Bankruptcy Court shall have entered the Confirmation Order,
which shall:

27

i. authorize the Debtors to take all actions necessary to enter
into, implement, and consummate the contracts, instruments,
releases, leases, indentures, and other agreements or
documents created in connection with the Plan;
ii. decree that the provisions of the Confirmation Order and the
Plan are nonseverable and mutually dependent;
iii. authorize the Debtors, as applicable/necessary, to:
(1) implement the Restructuring Transactions, including the
Equity Conversion; (2) distribute the Reorganized EFH
Common Stock, New Reorganized TCEH Debt, the
Reorganized TCEH Common Stock, and the New
Reorganized EFIH Debt, pursuant to the exemption from
registration under the Securities Act provided by section 1145
of the Bankruptcy Code or other exemption from such
registration or pursuant to one or more registration
statements; (3) make all distributions and issuances as
required under the Plan, including cash, the Reorganized EFH
Common Stock, New Reorganized TCEH Debt, the
Reorganized TCEH Common Stock, and the New
Reorganized EFIH Debt; and (4) enter into any agreements,
transactions, and sales of property as set forth in the Plan
Supplement, including the Reorganized TCEH Management
Incentive Plan;
iv. authorize the implementation of the Plan in accordance with
its terms; and
v. provide that, pursuant to section 1146 of the Bankruptcy
Code, the assignment or surrender of any lease or sublease,
and the delivery of any deed or other instrument or transfer
order, in furtherance of, or in connection with the Plan,
including any deeds, bills of sale, or assignments executed in
connection with any disposition or transfer of assets
contemplated under the Plan, shall not be subject to any
stamp, real estate transfer, mortgage recording, or other
similar tax (including, any mortgages or security interest
filing to be recorded or filed in connection with the New
Reorganized TCEH Debt, the New Reorganized EFIH Debt,
and the New Reorganized EFIH Junior Debt, as applicable);
and
(o) the Debtors shall have implemented the Restructuring Transactions,
including the Tax-Free Spin-Off and all transactions contemplated
by the Commitment Letter, in a manner consistent in all material
respects with the Restructuring Support Agreement, this Term Sheet,
and the Plan.
Waiver of Conditions
Precedent to the
Restructuring
The Debtors, with the prior written consent of the Required Consenting
Creditors and Required EFIH Unsecured Consenting Creditors (each acting
in their sole discretion), may waive any one or more of the Conditions
Precedent to the Restructuring.


28

CORPORATE GOVERNANCE PROVISIONS/SECTION 1145 EXEMPTION
Charter; Bylaws; Corporate
Governance
Corporate governance for Reorganized TCEH, including charters,
bylaws, operating agreements, or other organization documents, as
applicable, shall be consistent with section 1123(a)(6) of the Bankruptcy
Code (as applicable) and the Tax Matters Agreement, and the
composition of the Reorganized TCEH Board shall be determined by the
Ad Hoc TCEH Committee in consultation with (i) TCEH and, (ii) as
appropriate, with other Holders of TCEH First Lien Notes.
Corporate governance for Reorganized EFH and Reorganized EFIH,
including charters, bylaws, operating agreements, or other organization
documents, as applicable, shall be consistent with section 1123(a)(6) of
the Bankruptcy Code (as applicable) and the Tax Matters Agreement,
and the composition of the Reorganized EFH Board, the Reorganized
EFIH Board, and the officers of Reorganized EFH and Reorganized
EFIH shall be determined by the Required EFIH Unsecured Consenting
Creditors in consultation with (i) EFH, (ii) EFIH, (iii) Fidelity, and
(iv) as appropriate, with other Holders of EFIH Second Lien DIP Claims
or EFIH Unsecured Note Claims that will receive greater than 15% of
the Reorganized EFH Common Stock upon the Effective Date.
Exemption from SEC
Registration
The issuance of all securities under the Plan will be exempt from SEC
registration under applicable law.

[Exhibits follow.]

29

EXHIBIT A

DEFINITIONS
Term Definition
2007 Acquisition The 2007 transaction in which TEF and Texas Holdings and their
direct and indirect equity holders became the direct and indirect
equity holders of the Debtors.
Ad Hoc TCEH Committee The ad hoc committee of certain unaffiliated Consenting TCEH
First Lien Creditors (as defined in the Restructuring Support
Agreement) that is represented by Paul, Weiss, Rifkind, Wharton
& Garrison LLP and Millstein & Co., L.P.
Additional Interest Additional interest payable on the EFIH First Lien Notes or
EFIH Second Lien Notes, as applicable, under the registration
rights agreement associated with such notes so long as EFIH has
not registered such notes in accordance with the Securities Act,
on the terms set forth in such registration rights agreement.
Administrative Claim A Claim incurred by the Debtors on or after the Petition Date and
before the Effective Date for a cost or expense of administration
of the Chapter 11 Cases entitled to priority under sections
503(b), 507(a)(2), or 507(b) of the Bankruptcy Code.
Affiliate As defined in section 101(2) of the Bankruptcy Code.
Agreement Effective Date The effective date of the Restructuring Support Agreement, as
such term is further defined in the Restructuring Support
Agreement.
Allowed Any Claim that is not a Contested Claim or a Disallowed Claim.
Approval Motion As defined in the Term Sheet.
Approval Order As defined in the Term Sheet.
Avenue Avenue Capital Group and its affiliates.
Bankruptcy Code Title 11 of the United States Code, 11 U.S.C. 101-1532, as
amended from time to time.
Bankruptcy Court As defined in the Term Sheet.
Bankruptcy Rules The Federal Rules of Bankruptcy Procedure promulgated under
section 2075 of the Judicial Code, and the general, local, and
chambers rules of the Bankruptcy Court.
Bar Date The date established by the Bankruptcy Court by which Proofs of
Claim must be filed with respect to such Claims, as may be
ordered by the Bankruptcy Court.
Basis Step-Up As defined in the Term Sheet.
BNY The Bank of New York Mellon Trust Company, N.A., in its
capacity as trustee under certain Indentures, described herein.
Call Right As defined in the Term Sheet.

30

Term Definition
Cash Management Order An order of the Bankruptcy Court, in form and substance
acceptable to the Ad Hoc TCEH Committee, authorizing the
Debtors to, inter alia, continue using their existing cash
management system, maintain certain existing bank account and
continue certain intercompany transactions.
Cause of Action Any claims, Claims, Interests, damages, remedies, causes of
action, demands, rights, actions, suits, obligations, liabilities,
accounts, defenses, offsets, powers, privileges, licenses, and
franchises of any kind or character whatsoever, whether known
or unknown, foreseen or unforeseen, existing or hereinafter
arising, contingent or non-contingent, matured or unmatured,
suspected or unsuspected, in tort, law, equity, or otherwise.
Causes of Action also include: (a) all rights of setoff,
counterclaim, or recoupment and claims on contracts or for
breaches of duties imposed by law; (b) the right to object to or
otherwise contest Claims or Interests; (c) claims pursuant to
sections 362, 510, 542, 543, 544 through 550, or 553 of the
Bankruptcy Code; and (d) such claims and defenses as fraud,
mistake, duress, and usury and any other defenses set forth in
section 558 of the Bankruptcy Code.
Chapter 11 Cases When used with reference to a particular Debtor, the case
pending for that Debtor under chapter 11 of the Bankruptcy Code
in the Bankruptcy Court, and when used with reference to all the
Debtors, the procedurally consolidated and jointly administered
chapter 11 cases pending for the Debtors in the Bankruptcy
Court.
Claim As defined in section 101(5) of the Bankruptcy Code against a
Debtor.
Claim Objection Deadline The deadline for filing objections to Claims as set forth in the
Plan or in any Order of the Bankruptcy Court establishing a Bar
Date.
Class A category of Holders of Claims or Interests pursuant to
section 1122(a) of the Bankruptcy Code.
Code As defined in the Term Sheet.
Collateral Trust Agreement That certain Collateral Trust Agreement, dated as of November
16, 2009, by and among EFIH, BNY, as trustee, and the other
secured debt representatives party thereto.
Collective Benefit Fees As defined in the Term Sheet.
Commitment Letter That certain letter to EFH and EFIH from the Commitment
Parties memorializing the EFIH Second Lien DIP Financing
Commitment, dated as of April 29, 2014.
Commitment Parties Those certain Holders of EFIH Unsecured Notes backstopping
the EFIH Second Lien DIP Financing Commitment.

31

Term Definition
Competitive Tax Sharing
Agreement
That certain Federal and State Income Tax Allocation Agreement
(as amended and restated from time to time), dated May 15,
2012, by and among EFH and certain of its direct and indirect
subsidiaries.
Conditions Precedent As defined in the Term Sheet.
Confirmation Entry of the Confirmation Order on the docket of the Chapter 11
Cases, subject to the conditions set forth in the Plan and this
Term Sheet.
Confirmation Order The order entered by the Bankruptcy Court confirming the Plan.
Consenting Creditors As defined in the Restructuring Support Agreement.
Consenting Interest Holders As defined in the Restructuring Support Agreement.
Consummation The occurrence of the Effective Date.
Contested Claim A Claim (a) to the extent it is listed in the Schedules as disputed,
contingent, or unliquidated, in whole or in part, and as to which
no Proof of Claim has been filed; (b) if it is listed in the
Schedules as undisputed, liquidated, and not contingent and as to
which a Proof of Claim has been filed with the Bankruptcy
Court, to the extent (i) the Proof of Claim amount exceeds the
amount indicated in the Schedules, or (ii) the Proof of Claim
priority differs from the priority set forth in the Schedules; (c) if
it is not listed in the Schedules or was listed in the Schedules as
disputed, contingent or unliquidated, in whole or in part, but as to
which a Proof of Claim has been filed with the Bankruptcy
Court; or (d) as to which an objection has been filed on or before
the Claim Objection Deadline; provided, that a Claim (x) that is
fixed in amount and priority pursuant to the Plan or by final
order of the Bankruptcy Court or (y) with respect to which a
Proof of Claim has been timely filed and no objection has been
filed by the Claim Objection Deadline, shall not be a Contested
Claim.
Contribution As defined in the Term Sheet.
Conversion Agreement That certain agreement governing the terms of the Equity
Conversion, which shall be on the terms set forth on Exhibit B to
the Commitment Letter.
Conversion Shares Shares of Reorganized EFH Common Stock issued and
outstanding as of the Effective Date which will be issued
pursuant to the Equity Conversion.
Debtors As defined in the Introduction.
Disallowed Claim A Claim, or a portion thereof, that has been disallowed by a final
order of the Bankruptcy Court.

32

Term Definition
Disclosure Statement The disclosure statement for the Plan, including all exhibits and
schedules thereto and references therein that relate to the Plan
that is prepared and distributed in accordance with this Term
Sheet, the Bankruptcy Code, the Bankruptcy Rules, and any
other applicable law.
Distribution As defined in the Term Sheet.
EFCH As defined in the Introduction.
EFCH 2037 Note Claims Any Claim derived from or based upon the EFCH 2037 Notes.
EFCH 2037 Note Indenture That certain Indenture, dated as of December 1, 1995, by and
among EFCH, as the issuer, and BNY, as trustee.
EFCH 2037 Notes Collectively: (a) the EFCH Fixed 2037 Notes; and (b) the EFCH
Floating 2037 Notes.
EFCH 2037 Note Trustee BNY, or any successor thereto, in its capacity as trustee under
the EFCH 2037 Notes.
EFCH Fixed 2037 Notes The 8.175% Unsecured Fixed Notes due January 30, 2037,
issued by EFCH pursuant to the EFCH 2037 Note Indenture.
EFCH Floating 2037 Notes The 1.245% Unsecured Floating Rate Notes due January 30,
2037, issued by EFCH pursuant to the EFCH 2037 Note
Indenture.
Effective Date The date to be selected by the Debtors, in consultation with the
Required Consenting Creditors, for the Consummation of the
Plan, or as soon thereafter as reasonably practicable.
EFH As defined in the Introduction.
EFH 2019 Note Indenture That certain Indenture, dated November 16, 2009, by and among
EFH, as issuer, and BNY, as trustee.
EFH 2019 Notes The 9.75% unsecured notes due October 15, 2019, issued by
EFH pursuant to the EFH 2019 Note Indenture
EFH 2020 Note Indenture That certain Indenture dated January 12, 2010, by and among
EFH 2020 Notes The 10.0% unsecured notes due January 15, 2020, issued by
EFH pursuant to the EFH 2020 Note Indenture.
EFH Cash Cash on hand at EFH, including Oncor TSA payments if such is
determined by the Bankruptcy Court, less $38 million.
EFH Corporate Services EFH Corporate Services Company, a Texas corporation.
EFH Debtor Intercompany Claim A Claim by an EFH Debtor against another EFH Debtor.
EFH Debtors Collectively: (a) EFH; and (b) EFHs direct and indirect
subsidiaries listed on Exhibit C.

33

Term Definition
EFH-EFIH Intercompany Claims Allowed Non-EFH Debtor Intercompany Claims held by EFIH
against EFH; provided, however, that if the Restructuring
Support Agreement terminates, such claims shall be reduced on a
dollar-for-dollar basis to account for any Oncor TSA payments
actually received by EFIH; provided, further, that, for the
avoidance of doubt, all rights, offsets, claims, and defenses of
EFH will be preserved (in all cases, subject to any defenses) with
respect to such Claims.
EFH Interest Any Interest in EFH.
EFH LBO Note Primary Claims Any claims against EFH arising on account of the EFH LBO
Notes.
EFH LBO Note Claims Any claims arising on account of the EFH LBO Notes, including
the EFH LBO Note Primary Claims and the EFH LBO Note
Guaranty Claims. If the recovery to Holders of EFH LBO Note
Claims under the Plan is greater than 100% of the amount of
such Claims, any recovery on account of such claims shall be
returned to EFH or EFIH on a Pro Rata basis based on the
relative distributions from such Estates; provided, further, that if
Holders of General Unsecured Claims Against the EFIH Debtors
receive any postpetition interest on account of their Claims,
Holder of EFH LBO Note Claims shall be entitled to postpetition
interest before any such amounts are returned.
EFH LBO Note Indenture That certain Indenture, dated as of October 31, 2007, by and
among EFH, as the issuer, EFCH and EFIH, as guarantors, and
BNY, as trustee.
EFH LBO Notes Collectively: (a) the EFH LBO Senior Notes; and (b) the EFH
LBO Toggle Notes.
EFH LBO Notes Guaranty Claims Any guaranty claims against EFIH arising on account of the EFH
LBO Notes.
EFH LBO Notes Trustee BNY, or any successor thereto, in its capacity as trustee under
the EFH LBO Notes.
EFH LBO Senior Notes The 10.875% senior notes due November 1, 2017, issued by
EFH pursuant to the EFH LBO Note Indenture.
EFH LBO Toggle Notes The 11.25%/12.00% toggle notes due November 1, 2017, issued
by EFH pursuant to the EFH LBO Note Indenture.
EFH Legacy 2014 Notes The 5.55% series P senior notes due November 15, 2014, issued
by EFH pursuant to the EFH Legacy Note Indenture.
EFH Legacy 2024 Notes The 6.50% series Q senior notes due November 15, 2024, issued
EFH Legacy 2034 Notes The 6.55% series R senior notes due November 15, 2034, issued
EFH Legacy Note Indenture That certain Indenture, dated November 1, 2004, by and among

34

Term Definition
EFH Legacy Notes Collectively: (a) the EFH Legacy 2014 Notes; (b) the EFH
Legacy 2024 Notes; and (c) the EFH Legacy 2034 Notes.
EFH Non-Guaranteed Notes Collectively: (a) the EFH Unexchanged Notes; and (b) the EFH
Legacy Notes.
EFH Note Claim Any Claim derived from or based upon the EFH Notes.
EFH Notes Collectively: (a) the EFH Unexchanged Notes; (b) the EFH
Legacy Notes; and (c) the EFH LBO Notes.
EFH Notes Trustee BNY, or any successor thereto, in its capacity as trustee under
the EFH Notes.
EFH Properties EFH Properties Company, a Texas corporation.
EFH Unexchanged Notes Collectively: (a) the EFH 2019 Notes; and (b) the EFH 2020
Notes.
EFH Unsecured Claim Fund All EFH assets, including the EFH Cash, and Causes of Action,
but excluding Interests in EFIH, subject to all applicable rights
and defenses of EFH. In connection with the creation of the
EFH Unsecured Claim Fund, the Debtors shall request a
determination from the Bankruptcy Court regarding whether the
payments under the Oncor Tax Sharing Agreement are assets of
the Estates of the EFIH Debtors or the EFH Unsecured Claim
Fund (as successor to the rights of EFH in such respect).
EFIH As defined in the Introduction.
EFIH Debtor Intercompany Claim A Claim by an EFIH Debtor against another EFIH Debtor.
EFIH Debtors Collectively: (a) EFIH; and (b) EFIH Finance.
EFIH Finance EFIH Finance Inc., a Delaware corporation.
EFIH First Lien 2017 Note
Indenture
That certain Indenture, dated August 14, 2012, by and among
EFIH and EFIH Finance, as issuers, and CSC Trust Company of
Delaware, as successor trustee to BNY.
EFIH First Lien 2017 Notes The 6.875% senior secured notes due August 15, 2017, issued by
EFIH and EFIH Finance pursuant to the EFIH First Lien 2017
Note Indenture.
EFIH First Lien 2020 Note
Indenture
That certain Indenture, dated August 17, 2010, by and among
EFIH and EFIH Finance, as issuers, and CSC Trust Company of
Delaware, as successor trustee to BNY.
EFIH First Lien 2020 Notes The 10.0% senior secured notes due December 1, 2020, issued
by EFIH and EFIH Finance pursuant to the EFIH First Lien 2020
Note Indenture.
EFIH First Lien DIP Claims Any and all Claims derived from or based upon the EFIH First
Lien DIP Financing.

35

Term Definition
EFIH First Lien DIP Financing The postpetition debtor-in-possession financing facility
substantially on the terms set forth on Exhibit G.
EFIH First Lien Indentures The EFIH First Lien 2020 Note Indenture and the EFIH First
Lien 2017 Note Indenture.
EFIH First Lien Makewhole Claim Any Claim derived from or based upon makewhole or other
similar payment provisions under the EFIH First Lien Notes.
EFIH Second Lien DIP Motion As defined in the Term Sheet.
EFIH First Lien Note Claim Any Claim derived from or based upon the EFIH First Lien
Notes.
EFIH First Lien Notes Collectively: (a) the EFIH First Lien 2017 Notes; and (b) the
EFIH First Lien 2020 Notes.
EFIH First Lien Settlement As defined in the Term Sheet.
EFIH Second Lien 2021 Notes The 11.0% senior secured second lien notes due October 1, 2021,
issued by EFIH and EFIH Finance pursuant to the EFIH Second
Lien Note Indenture.
EFIH Second Lien 2022 Notes The 11.75% senior secured second lien notes due March 1, 2022,
issued by EFIH and EFIH Finance pursuant to the EFIH Second
Lien Note Indenture.
EFIH Second Lien Cash-Out
Option
As defined in the Term Sheet.
EFIH Second Lien DIP Claims Any and all Claims derived from or based upon the EFIH Second
Lien DIP Financing.
EFIH Second Lien DIP Financing The postpetition debtor-in-possession financing facility
substantially on the terms set forth on Exhibit A to the
Commitment Letter.
EFIH Second Lien DIP Motion As defined in the Term Sheet.
EFIH Second Lien DIP Financing
Commitment
EFIH Second Lien DIP Roll Option As defined in the Term Sheet.
EFIH Second Lien Makewhole
Claim
Any Claim derived from or based upon makewhole or other
similar payment provisions under the EFIH Second Lien Notes.
EFIH Second Lien Note Claim Any Claim derived from or based upon the EFIH Second Lien
Notes.
EFIH Second Lien Note Indenture That certain Indenture, dated April 25, 2011, by and among
EFIH and EFIH Finance, as issuers, and BNY, as trustee.
EFIH Second Lien Notes Collectively: (a) the EFIH Second Lien 2021 Notes; and (b) the
EFIH Second Lien 2022 Notes.

36

Term Definition
EFIH Second Lien Settlement As defined in the Term Sheet.
EFIH Senior Toggle Note
Indenture
That certain Indenture, dated December 5, 2012, by and among
EFIH and EFIH Finance, as issuers, and UMB Bank, N.A, as
trustee.
EFIH Senior Toggle Notes The 11.25%/12.25% unsecured senior toggle notes due
December 1, 2018, issued by EFIH and EFIH Finance pursuant
to the EFIH Senior Toggle Note Indenture.
EFIH Shared Services Agreement That certain Shared Services Agreement, dated March 28, 2014,
by and among EFIH, EFIH Finance, and EFH Corporate
Services.
EFIH Unexchanged Note Indenture That certain Indenture, dated November 16, 2009, by and among
EFIH and EFIH Finance, as issuers, and BNY, as trustee.
EFIH Unexchanged Notes The 9.75% fixed senior notes due October 15, 2019, issued by
EFIH and EFIH Finance pursuant to the EFIH Unexchanged
Note Indenture.
EFIH Unsecured Note Claim Any Claim against EFIH derived from or based upon the EFIH
Unsecured Notes.
EFIH Unsecured Notes Collectively: (a) the EFIH Senior Toggle Notes and (b) the
EFIH Unexchanged Notes.
Entity As defined in section 101(15) of the Bankruptcy Code.
Equity Conversion The mandatory conversion of the EFIH Second Lien DIP
Financing, inclusive of any Commitment Fee (which for the
avoidance of doubt, assumes a $1.9 billion funding amount and
the Funding PIK Fee), into 177,658,788 Conversion Shares, plus
an additional 89,052 Conversion Shares for each million dollars
of EFIH Second Lien DIP Financing in excess of $1,995 million,
and less 89,052 shares of Conversion Shares for each million
dollars of EFIH Second Lien DIP Financing less than $1,995
million outstanding on the Effective Date; provided, however,
that the stated plan value of the Conversion Shares is at least
equal to the adjusted issue price of the EFIH Second Lien DIP
Financing.
2
For the avoidance of doubt, this is a negotiated plan
value solely for purposes of the deal embodied in this Term
Sheet and the Restructuring Support Agreement and shall not be
binding upon any party to the extent the Plan is not confirmed
and consummated.
Estate As to each Debtor, the estate created for the Debtor in its Chapter
11 Case pursuant to section 541 of the Bankruptcy Code.

2
Calculated contemplated accrued interest as of April 30, 2014.

37

Term Definition
Exculpated Parties Collectively, and in each case in its capacity as such: (a) the
Debtors and Reorganized Debtors; (b) the Consenting Creditors;
(c) the Consenting Interest Holders; (d) the DIP Agents; (e) the
DIP Lenders; and (f) with respect to each of the foregoing
entities in clauses (a) through (e), such Entitys current and
former affiliates, equity holders (regardless of whether such
interests are held directly or indirectly), subsidiaries, officers,
directors, managers, principals, members, employees, agents,
financial advisors, partners, attorneys, accountants, investment
bankers, consultants, representatives, and other professionals.
Extended Outside Date As defined in the Restructuring Support Agreement.
FERC The Federal Energy Regulatory Commission.
Fidelity Collectively, Fidelity Investments and its affiliates that execute
the Restructuring Support Agreement before the Petition Date.
Fidelity Repayment The cash payment by Holders of General Unsecured Claims
Against EFH other than Fidelity that elected to participate in
their Pro Rata share of up to 9% of the Equity Conversion, which
shall be used by EFIH to repay in cash the applicable Second
Lien DIP Notes held by Fidelity in respect of such share,
simultaneously with the Equity Conversion.
General Unsecured Claim Against
EFH
Any Unsecured Claim against EFH that is not otherwise paid in
full pursuant to a separate order of the Bankruptcy Court,
including the EFH Note Claims and the EFH LBO Note Primary
Claims, but excluding: (a) Administrative Claims against the
EFH Debtors; (b) Intercompany Claims against the EFH
Debtors; and (c) Other Priority Claims against the EFH Debtors.
the EFH Debtors Other Than EFH
Any Unsecured Claim against one or more of the EFH Debtors
other than EFH that is not otherwise paid in full pursuant to a
separate order of the Bankruptcy Court, excluding:
(a) Administrative Claims against the EFH Debtors;
(b) Intercompany Claims against the EFH Debtors; and (c) Other
Priority Claims against the EFH Debtors.
the EFIH Debtors
Any Unsecured Claim against one or more of the EFIH Debtors
that is not otherwise paid in full pursuant to a separate order of
the Bankruptcy Court, including the EFIH Unsecured Note
Claims and the EFH LBO Notes Guaranty Claims, but
excluding: (a) Administrative Claims against the EFIH Debtors;
(b) Intercompany Claims against the EFIH Debtors; and (c)
Other Priority Claims against the EFIH Debtors.

38

Term Definition
the TCEH Debtors
Any Unsecured Claim against one or more of the TCEH Debtors
that is not otherwise paid in full pursuant to separate order of the
Bankruptcy Court, including the EFCH 2037 Note Claims,
TCEH First Lien Deficiency Claims, TCEH Second Lien Note
Claims, and TCEH Unsecured Note Claims, but excluding:
(a) Administrative Claims against the TCEH Debtors; (b)
Intercompany Claims against the TCEH Debtors; and (c) Other
Priority Claims against the TCEH Debtors.
GSO GSO Capital Partners and its affiliates.
Holder An Entity holding a Claim or Interest, as applicable.
Impaired With respect to any Class of Claims or Interests, a Class of
Claims or Interests that is impaired within the meaning of section
1124 of the Bankruptcy Code.
Incremental Amendment
Agreement
That certain Incremental Amendment No. 1, dated as January 4,
2013, by and among the Incremental 2012 Term Lenders (as
defined therein), EFCH, TCEH, the Credit Parties (as defined
therein) party thereto, and Citibank, N.A., as Administrative
Agent and Collateral Agent.
Intended Tax-Free Treatment As defined in the Term Sheet.
Intercompany Claim A Claim by EFH or any direct or indirect subsidiary of EFH
against EFH or any direct or indirect subsidiary of EFH.
Interest Any equity security (as defined in section 101(16) of the
Bankruptcy Code) in any Debtor.
IRS The Internal Revenue Service.
IRS Submission As defined in the Term Sheet.
Legacy General Unsecured Claims
Against EFH
Any Claims against EFH arising from liabilities based on
asbestos exposure and post-employment benefits relating
discontinued operations of the Debtors and their Affiliates.
Liability Management Program The various transactions, including debt buybacks, new debt
issuances, debt exchanges, and maturity extensions, by EFH and
its direct and indirect subsidiaries, and restructuring of such
Entities debt obligations completed before the Petition Date, as
described in the Debtors most recent annual SEC filing.
Minimum Basis As defined in the Term Sheet.
New Reorganized EFIH Debt The new long-term secured EFIH funded debt issued on the
Effective Date on terms and conditions mutually acceptable to
the EFIH Debtors and the Required EFIH Unsecured Consenting
Creditors.

39

Term Definition
New Reorganized TCEH Debt The new long-term secured TCEH debt, consistent with the
terms set forth in this Term Sheet. The amount of the New
Reorganized TCEH Debt issued on the Effective Date shall not
be less than the Minimum Basis.
Non-EFH Debtor Intercompany
Claim
A Claim by EFH or any direct or indirect subsidiary of EFH
other than an EFH Debtor against an EFH Debtor, including
EFH Note Claims held by EFIH.
Non-EFIH Debtor Intercompany
Claim
other than an EFIH Debtor against an EFIH Debtor.
Non-Settling EFIH First Lien Note
Holders
Non-Settling EFIH Second Lien
Note Holders
Non-TCEH Debtor Intercompany
Claim
other than a TCEH Debtor against a TCEH Debtor, including
any Claim against a TCEH Debtor arising under or related to the
Competitive Tax Sharing Agreement, but excluding any Claim
derived from or based upon TCEH First Lien Notes held by
EFH.
NRC The Nuclear Regulatory Commission.
Oak Grove Promissory Note The promissory note issued by Oak Grove Power Company LLC
and secured by certain minerals and real property in Robertson,
Texas.
Oak Grove Promissory Note Claim Any Claim derived from or based upon the Oak Grove
Promissory Note.
Oncor Tax Sharing Agreement The amended and restated Tax Sharing Agreement, dated as of
November 5, 2008, by and among EFH, Oncor Electric Delivery
Holdings Company LLC, Oncor Electric Delivery Company
LLC, Texas Transmission Investment LLC, and Oncor
Management Investment LLC.
Oncor TSA Amendment As defined in the Term Sheet.
Oncor TSA Amendment Order As defined in the Term Sheet.

40

Term Definition
Oncor TSA Amendment Payment $55 million cash to be paid by EFIH to EFH on the Effective
Date, which shall be paid to Holders of General Unsecured
Claims Against EFH on the Effective Date; provided, however,
that such payment from EFIH will be reduced dollar-for-dollar
(for the avoidance of doubt, beginning with the first dollar of any
shortfall) in the event that EFIH receives less than 80% of the
amount shown below for the date that is nearest to the Effective
Date:

Effective Date: Projected EFIH Net Tax Receipts:
January 31, 2015 $254 million
February 28, 2015 $261 million
March 31, 2015 $261 million
April 30, 2015 $321 million
May 31, 2015 $328 million
June 30, 2015 $387 million
July 31, 2015 $387 million
August 31, 2015 $394 million
September 30, 2015 $453 million
Other Priority Claim Any Claim, other than an Administrative Claim or a Priority Tax
Claim, entitled to priority in right of payment under section
507(a) of the Bankruptcy Code.
Other Secured Claim Any Secured Claim against any of the Debtors, including the
Oak Grove Promissory Note Claims and Tex-La Obligations, but
not including a: (a) TCEH First Lien Secured Claim; (b) TCEH
Second Lien Secured Claim; (b) EFIH First Lien Note Claim; or
(c) EFIH Second Lien Note Claim.
Participation Rights The right to participate in the EFIH Second Lien DIP Financing
as set forth in the Commitment Letter.
Petition Date The date on which the Debtors commence the Chapter 11 Cases.
PIMCO Collectively, funds and accounts under the management of
Pacific Investment Management Company LLC and its
subsidiaries, in each case solely to the extent that they hold EFIH
First Lien Note Claims in the aggregate amounts set forth on
PIMCOs signature page to the Restructuring Support
Agreement.
Plan As defined in the Introduction.
Plan Restructuring Documents As defined in the Restructuring Support Agreement.
Plan Supplement The compilation of documents and forms of documents,
schedules, and exhibits to the Plan filed by the Debtors.
PLR Participation Parties As defined in the Term Sheet.

41

Term Definition
PLR Participation Party
Representative
Pre-Submission Conference As defined in the Term Sheet.
Pre-Submission Memo As defined in the Term Sheet.
Priority Tax Claims Claims of governmental units of the type described in section
507(a)(8) of the Bankruptcy Code.
Private Letter Ruling As defined in the Term Sheet.
Professional Fees As defined in the Term Sheet.
Proof of Claim A proof of Claim filed against any of the Debtors in the Chapter
11 Cases by the applicable Bar Date.
Pro Rata The proportion that a Claim or Interest in a particular Class bears
to the aggregate amount of the Claims or Interests in that Class,
or the proportion of the Claims or Interests in a particular Class
and other Classes entitled to share in the same recovery as such
Claim or Interest under the Plan.
PUC The Public Utility Commission of Texas.
Reinstated (a) leaving unaltered the legal, equitable and contractual rights to
which a Claim entitles the holder of such Claim, or
(b) notwithstanding any contractual provision or applicable law
that entitles the holder of such Claim to demand or receive
accelerated payment of such Claim after the occurrence of a
default, (i) curing any such default that occurred before or after
the Petition Date, other than a default of a kind specified in
section 365(b)(2) of the Bankruptcy Code; (ii) reinstating the
maturity of such Claim as such maturity existed before such
default; (iii) compensating the holder of such Claim for any
damages incurred as a result of any reasonable reliance by such
holder on such contractual provision or such applicable law;
(iv) if such Claim arises from any failure to perform a
nonmonetary obligation under a nonresidential real property
lease subject to section 365(b)(1)(A) of the Bankruptcy Code,
compensating the holder of such Claim for any pecuniary loss
incurred by such holder as the result of such failure; and (v) not
otherwise altering the legal, equitable or contractual rights to
which such Claim entitles the holder thereof.

42

Term Definition
Released Parties Collectively, and in each case in its capacity as such: (a) the
Consenting Creditors; (b) the Commitment Parties; (c) any
Selected Partners (as defined in the Commitment Letter); (d) any
Selected Investment Commitment Partners (as defined in the
Commitment Letter); (e) the Consenting Interest Holders; (f) the
lenders under the TCEH DIP Financing, EFIH First Lien DIP
Financing, and the EFIH Second Lien DIP Financing; (g) the
agents under the TCEH Credit Agreement, TCEH DIP
Financing, EFIH First Lien DIP Financing, and the EFIH Second
Lien DIP Financing; and (h) with respect to each of the Debtors,
the Reorganized Debtors, and each of the foregoing entities in
clauses (a) through (g), such Entity and its affiliates, and such
Entity and its affiliates current and former equity holders
(regardless of whether such interests are held directly or
indirectly), subsidiaries, officers, directors, managers, principals,
members, employees, agents, financial advisors, partners,
attorneys, accountants, investment bankers, consultants,
representatives, and other professionals; provided, however, that
any Holder of a Claim or Interest that opts out of the releases
contained in the Plan shall not be a Released Party.
Releasing Parties Collectively, and in each case in its capacity as such: (a) the
Consenting Creditors; (b) the Commitment Parties; (c) any
Selected Partners (as defined in the Commitment Letter); (d) any
Selected Investment Commitment Partners (as defined in the
Commitment Letter); (e) the Consenting Interest Holders; (f) the
lenders under the TCEH DIP Financing, EFIH First Lien DIP
Financing, and the EFIH Second Lien DIP Financing; (g) the
agents under the TCEH Credit Agreement, TCEH DIP
Financing, EFIH First Lien DIP Financing, and the EFIH Second
Lien DIP Financing; (h) with respect to each of the Debtors, the
Reorganized Debtors, and each of the foregoing entities in
clauses (a) through (g), such Entity and its affiliates, and such
Entity and its affiliates current and former equity holders
(regardless of whether such interests are held directly or
indirectly), subsidiaries, officers, directors, managers, principals,
members, employees, agents, financial advisors, partners,
attorneys, accountants, investment bankers, consultants,
representatives, and other professionals; (i) all holders of Claims
that are deemed to accept the Plan; (j) all holders of Claims who
vote to accept the Plan; and (k) all holders in voting Classes who
abstain from voting on the Plan and who do not opt out of the
releases provided by the Plan.
Reorganized Debtors Collectively, and each in its capacity as such (and to the extent
such Entity is a Debtor in the Chapter 11 Cases): (a) Reorganized
EFH; (b) Reorganized EFIH; and (c) the Reorganized TCEH
Debtors.

43

Term Definition
Reorganized EFH EFH, or any successor thereto, by merger, consolidation, or
otherwise, on and after the Effective Date, it being understood
that, as of the Effective Date, Reorganized EFH shall be a
corporation organized under the laws of the state of Texas.
Reorganized EFH Board The board of directors of Reorganized EFH on and after the
Effective Date.
Reorganized EFH Common Stock The newly-issued common stock in Reorganized EFH, which
shall consist of 100 million shares prior to the Equity Conversion
and the issuance of shares under the Reorganized EFH/EFIH
Management Incentive Plan (if any), which shall be issued in
accordance with this Term Sheet. The number of shares of
newly-issued Reorganized EFH Common Stock may be
increased or decreased at the direction of the Required EFIH
Unsecured Consenting Creditors, which shall result in the
proportionate increase or decrease, as applicable, of Reorganized
EFH Common Stock issued under the Equity Conversion.
Reorganized EFIH EFIH, or any successor thereto, by merger, consolidation, or
that, as of the Effective Date, Reorganized EFIH shall be a
limited liability company organized under the laws of the state of
Delaware.
Reorganized EFIH Board The board of directors of Reorganized EFIH on and after the
Effective Date.
Reorganized TCEH TCEH, or any successor thereto, by merger, consolidation, or
that, as of the Effective Date, Reorganized TCEH shall be a
corporation organized under the laws of the state of Delaware.
Reorganized TCEH Board The board of directors of Reorganized TCEH on and after the
Effective Date.
Reorganized TCEH Common
Stock
The newly-issued common stock of Reorganized TCEH, which
shall be issued in accordance with this Term Sheet.
Reorganized TCEH Debtors TCEH and each of its Debtor subsidiaries, or any successor
thereto, by merger, consolidation, or otherwise, on and after the
Effective Date.
Reorganized TCEH Management
Incentive Plan
The Management Incentive Plan of Reorganized TCEH on terms
and conditions to be determined on or after the Effective Date by
the compensation committee of the Reorganized TCEH Board.
The maximum amount of Reorganized TCEH Common Stock to
be allocated to the Management Incentive Plan will be
determined by the Ad Hoc TCEH Committee, in consultation
with the TCEH Debtors, on or before the hearing date regarding
approval of the Disclosure Statement.
Required Consenting Creditors As defined in the Restructuring Support Agreement.

44

Term Definition
Required EFIH Unsecured
Consenting Creditors
At least three (3) investment advisors that manage and/or advise
funds or accounts that beneficially own, collectively, at least
66.6% of the EFIH Unsecured Note Claims held by all
Required Rulings As defined in the Term Sheet.
Restructuring As defined in the Introduction.
Restructuring Support Agreement The Restructuring Support and Lock-Up Agreement to which
this Term Sheet is attached as Exhibit A, pursuant to which the
Debtors, the Consenting Interest Holders, the Consenting
Creditors, and the Permitted Transferees (if any) (as defined in
the Restructuring Support Agreement) agree to pursue and
implement the Restructuring, including the transactions
contemplated by the Commitment Letter, consistent in form and
substance in all material respects with this Term Sheet and the
Plan.
Restructuring Transactions Those mergers, amalgamations, consolidations, arrangements,
continuances, restructurings, transfers, conversions, dispositions,
liquidations, dissolutions, or other corporate transactions that the
Debtors, the Consenting Interest Holders, and the Consenting
Creditors reasonably determine to be necessary to implement the
Plan.
Ruling Request As defined in the Term Sheet.
Rural Utilities Service An agency of the United States Department of Agriculture tasked
with providing public utilities to rural areas in the United States
through public-private partnerships.
Schedules The schedules of assets and liabilities and the statements of
financial affairs filed by the Debtors with the Bankruptcy Court,
as required by section 521 of the Bankruptcy Code and in
conformity with the Bankruptcy Rules, as such schedules and
statements have been or may be amended or supplemented from
time to time in accordance with Bankruptcy Rule 1009
SEC The Securities and Exchange Commission.
Secured When referring to a Claim: (a) secured by a lien on property in
which any of Debtors has an interest, which lien is valid,
perfected, and enforceable pursuant to applicable law or by
reason of a Bankruptcy Court order, or that is subject to setoff
pursuant to section 553 of the Bankruptcy Code, to the extent of
the value of the creditors interest in the Debtors interest in such
property or to the extent of the amount subject to setoff, as
applicable, as determined pursuant to section 506(a) of the
Bankruptcy Code; or (b) Allowed pursuant to the Plan, or
separate order of the Bankruptcy Court, as a secured claim.
Securities Act The Securities Act of 1933, 15 U.S.C. 77a77aa, together
with the rules and regulations promulgated thereunder.

45

Term Definition
Security A security as defined in section 2(a)(1) of the Securities Act.
Selected Partners As defined in the Commitment Letter.
Settling EFIH First Lien Note
Holders
Settling EFIH Second Lien Note
Holders
Shared Services As defined in the Term Sheet.
Tax-Free Spin-Off The transactions required to preserve the Intended Tax-Free
Treatment of the Restructuring Transactions, including the
Contribution and the Distribution.
Tax Matters Agreement The tax matters agreement entered into by Reorganized EFH and
Reorganized TCEH as of the Effective Date which shall govern
the rights and obligations of each party with respect to certain tax
matters, including covenants to protect the Intended Tax-Free
Treatment of the Restructuring Transactions and indemnity
provisions if either party takes action that causes the
Restructuring Transactions to fail to qualify for the Intended
Tax-Free Treatment.
Tax Sharing Agreements

Collectively: (a) the Competitive Tax Sharing Agreement; and
(b) the Oncor Tax Sharing Agreement.
TCEH As defined in the Introduction.
TCEH 2012 Incremental Term
Loans
The TCEH First Lien Claims deemed to have been incurred
pursuant to Section 1 of the Incremental Amendment Agreement.
TCEH 2015 Notes The 10.25% fixed senior notes due November 1, 2015, issued by
TCEH and TCEH Finance pursuant to the TCEH 2015 Note
Indenture.
TCEH 2015 Note Indenture That certain Indenture, dated as of October 31, 2007, by and
among TCEH and TCEH Finance, as the issuers; EFCH and
certain TCEH subsidiaries, as guarantors, and Law Debenture
Trust Company of New York, as successor trustee to BNY.
TCEH Cash Collateral Order An order entered by the Bankruptcy Court approving the TCEH
Debtors use of the TCEH First Lien Creditors cash collateral
subject to the terms and conditions described therein, which
order shall be in form and substance reasonably satisfactory to
the Ad Hoc TCEH Committee.
TCEH Credit Agreement The TCEH Credit Agreement, dated as of October 10, 2007, by
and among TCEH, as the borrower; EFCH and certain TCEH
subsidiaries, as guarantors; Wilmington Trust, N.A., as successor
administrative and collateral agent to Citibank, N.A.; and the
TCEH First Lien Lenders.
TCEH Debtor Intercompany Claim A Claim by a TCEH Debtor against another TCEH Debtor.

46

Term Definition
TCEH Debtors Collectively: (a) EFCH; (b) TCEH; and (c) the TCEH
subsidiaries listed on Exhibit B.
TCEH DIP Claims Any and all Claims arising under or related to the TCEH DIP
Financing.
TCEH DIP Financing The TCEH Debtors $4,475 million debtor-in-possession
financing facility on the terms set forth on Exhibit F.
TCEH Finance TCEH Finance, Inc., a Delaware corporation.
TCEH First Lien Claims Any Claim derived from or based upon: (a) the TCEH Credit
Agreement (including the term loan, revolver, and letter of credit
facilities); (b) the TCEH First Lien Notes, including TCEH First
Lien Notes held by EFH; (c) the TCEH First Lien Interest Rate
Swaps; or (d) the TCEH First Lien Commodity Hedges.
TCEH First Lien Commodity
Hedges
The commodity hedges entered into by TCEH and secured by the
same collateral as Claims under the TCEH Credit Agreement and
the TCEH First Lien Notes (but without respect to any setoff
rights that a counterparty to a TCEH First Lien Commodity
Hedge may have against TCEH).
TCEH First Lien Deficiency
Claims
Any TCEH First Lien Claim that is not a TCEH First Lien
Secured Claim.
TCEH First Lien Interest Rate
Swaps
The interest rate swaps entered into by TCEH and secured by the
same collateral as Claims under the TCEH Credit Agreement and
the TCEH First Lien Notes (but without respect to any setoff
rights that a counterparty to a TCEH First Lien Interest Rate
Swap may have against TCEH).
TCEH First Lien Lenders The lending institutions party from time to time to the TCEH
Credit Agreement.
TCEH First Lien Note Indenture That certain Indenture, dated as of April 19, 2011, by and among
TCEH and TCEH Finance, as the issuers, EFCH and certain
TCEH subsidiaries, as guarantors, and BNY, as trustee.
TCEH First Lien Notes The TCEH first lien notes due October 1, 2020, issued by TCEH
and TCEH Finance pursuant to the TCEH First Lien Note
Indenture.
TCEH First Lien Secured Claims Any TCEH First Lien Claim that is Secured. TCEH First Lien
Secured Claims shall be Allowed as Secured Claims in an
amount to be determined by the TCEH Debtors with the
reasonable consent of the Ad Hoc TCEH Committee.
TCEH Second Lien Note Claims Any Claim derived from or based upon the TCEH Second Lien
Notes.
TCEH Second Lien Note Indenture That certain Indenture, dated as of October 6, 2010, by and
among TCEH and TCEH Finance, as the issuers; Citibank, N.A.,
as administrative agent, EFCH and certain of TCEHs
subsidiaries, as guarantors, and Wilmington Savings, as
successor trustee to BNY.

47

Term Definition
TCEH Second Lien Notes The TCEH Second Lien Notes due April 21, 2021, issued by
TCEH pursuant to the TCEH Second Lien Note Indenture.
TCEH Senior Toggle Note
Indenture
That certain Indenture, dated as of December 6, 2007, by and
among TCEH and TCEH Finance, as the issuers; EFCH and
certain TCEH subsidiaries, as guarantors; and Law Debenture
Trust Company of New York, as successor trustee to BNY.
TCEH Senior Toggle Notes The 10.50%/11.25% Senior Toggle Notes due November 1,
2016, issued by TCEH and TCEH Finance pursuant to the TCEH
Senior Toggle Note Indenture.
TCEH Unsecured Claim Fund Cash in an amount equal to the value of the unencumbered assets
of TCEH.
TCEH Unsecured Note Claims Any Claim derived from or based upon the TCEH Unsecured
Notes.
TCEH Unsecured Notes Collectively: (a) the TCEH 2015 Notes; and (b) the TCEH
Senior Toggle Notes.
TEF As defined in the Restructuring Support Agreement.
Term Sheet As defined in the Introduction.
Tex-La Tex-La Electric Cooperative of Texas, Inc.
Tex-La 2019 Obligations The payment obligations of EFCH under the terms of the Tex-La
Assumption Agreement with respect to the 9.58% fixed notes
due 2019 issued by Tex-La in the outstanding principal amount
of $35 million.
Tex-La 2021 Obligations The payment obligations of EFCH under the terms of the Tex-La
Assumption Agreement with respect to the 8.254% Fixed Notes
due 2021 issued by Tex-La in the outstanding principal amount
of $37 million.
Tex-La Assumption Agreement That certain Assumption Agreement, dated February 1, 1990, by
and among EFCH, Tex-La, and the United States of America
acting through the Administrator of the Rural Utilities Service,
whereby EFCH agreed to assume certain payment obligations
related to certain outstanding indebtedness of Tex-La that is
guaranteed by the Rural Utilities Service.
Tex-La Obligations Collectively: (a) the Tex-La 2019 Obligations; and (b) the Tex-
La 2021 Obligations, including any prepayment premiums and
other costs and expenses due as full and final satisfaction of each
of the foregoing.
Texas Holdings As defined in the Restructuring Support Agreement.
Total Professional Fees As defined in the Term Sheet.
Tranche A-3 Redemption As defined in the Term Sheet
Unimpaired With respect to a Class of Claims or Interests, a Class of Claims
or Interests that is not Impaired.

48

Term Definition
Unsecured Claim Any Claim that is not a Secured Claim.
Wilmington Savings Wilmington Savings Fund Society, FSB, as successor trustee
under the TCEH Second Lien Note Indenture.
York York Capital Management LLC and its affiliates.

EXHIBIT B
TCEH SUBSIDIARIES PARTY TO RESTRUCTURING

TCEH Finance
TXU SEM Company


2

EXHIBIT C
EFH SUBSIDIARIES PARTY TO RESTRUCTURING

Brighten Energy LLC
Dallas Power and Light Company, Inc.
EEC Holdings, Inc.
EECI, Inc.
LSGT SACROC, Inc.
Texas Power and Light Company, Inc.


EXHIBIT D
REGARDED TCEH DEBTORS PARTY TO RESTRUCTURING
TCEH Finance
TXU SEM Company


EXHIBIT E

PRE-SUBMISSION MEMO


EXHIBIT F

TCEH DIP TERM SHEET


EXHIBIT G

EFIH FIRST LIEN DIP FINANCING TERM SHEET

EXHIBIT H

EFIH SECOND LIEN DIP FINANCING TERM SHEET


EXHIBIT I
CLOSING CONDITIONS


EXHIBIT J
EQUITY CONVERSION TERM SHEET


EXHIBIT K
SUMMARY OF KEY REPRESENTATIONS


EXHIBIT B
TCEH SUBSIDIARIES PARTY TO RESTRUCTURING

TCEH Finance
TXU SEM Company


2

EXHIBIT C
EFH SUBSIDIARIES PARTY TO RESTRUCTURING

Brighten Energy LLC
Dallas Power and Light Company, Inc.
EEC Holdings, Inc.
EECI, Inc.
LSGT SACROC, Inc.
Texas Power and Light Company, Inc.


EXHIBIT D
REGARDED TCEH DEBTORS PARTY TO RESTRUCTURING
TCEH Finance
TXU SEM Company


EXHIBIT E

PRE-SUBMISSION MEMO

DRAFT 4.28.14
Privileged & Confidential
1
508551 000027 9611307.15
ENERGY FUTURE HOLDINGS CORP.
PRE-SUBMISSION MEMORANDUM FOR RULINGS UNDER
SECTIONS 368(A)(1)(G) AND 355

I. Overview

This memorandum describes a significant bankruptcy restructuring transaction that
requires an Internal Revenue Service (IRS) ruling in order to be implemented. The proposed
transaction involves the spin-off of the assets of Texas Competitive Electric Holdings LLC
(TCEH) from Energy Future Holdings Corp. (EFH) pursuant to Section 355 and Section
368(a)(1)(G) (a G reorganization).
1
TCEH has an enterprise value of approximately $18
billion and, prior to the restructuring, liabilities in excess of $32 billion. Without regard to
TCEH, EFH indirectly holds (and will continue to hold indirectly following the restructuring) an
80% interest in a partnership with an enterprise value of approximately $17 billion.
2

A multi-party restructuring support agreement (RSA) that provides for the transaction
described above has been filed with the U.S. Bankruptcy Court for the District of Delaware. The
consummation of those transactions is expressly conditioned on obtaining IRS rulings with
respect to the proposed transactions as further set forth herein. If the IRS rulings set forth herein
are not obtained, the parties to the RSA will have the right to terminate the RSA and abandon the
transactions described therein. EFH believes that if the proposed transactions are abandoned,
one or more creditor groups will seek the transfer of the assets of EFH (and the assets of its
subsidiaries) in satisfaction of their claims, with any such transfers being taxable transactions
resulting in an expected tax liability in excess of $6 billion. EFH does not expect to have
sufficient assets to satisfy such tax liability.

All parties to this transaction desire to avoid triggering a multi-billion dollar tax that
cannot be paid and that would be subordinated to the claims of the secured creditors. As a result,
the parties have agreed on a structure for a transaction that all sides believe generally should be
tax-free. But given the magnitude of the issue, the unique tax issues that it raises, the cash cost
of the potential tax liability, and the public attention that this transaction is apt to attract, the
parties are willing to go forward only if it can be done pursuant to an IRS ruling that covers the
qualification of the proposed transaction under Sections 368(a)(1)(G) and 355 and the other
rulings described herein.

II. Facts

a. Bankruptcy Reorganization

EFH is a Dallas, Texas-based holding company with a portfolio of competitive and
regulated energy businesses in Texas that it operates through its direct and indirect subsidiaries.

1
Unless otherwise noted, all section references contained herein are to the Internal Revenue Code of 1986, as
amended, and Treasury Regulation references are to the Treasury Regulations promulgated thereunder.
2
These valuations of $18 billion and $17 billion for TCEH and EFHs partnership subsidiary are illustrative only,
based on the current trading prices of TCEH debt and the terms of the proposed transaction with EFIH creditors.
Actual values at closing could be higher or lower.
DRAFT 4.28.14
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508551 000027 9611307.15
EFH was acquired by a group of private equity funds (the Sponsors) in 2007 pursuant to a
leveraged buyout (the LBO). EFH owns 100% of the equity interests of Energy Future
Competitive Holdings Company LLC (EFCH) and Energy Future Intermediate Holding
Company LLC (EFIH), both of which are disregarded entities for federal income tax purposes.
EFCHs principal asset is its membership interest in TCEH, which, through its subsidiaries, is
engaged in competitive electricity market activities primarily conducted in Texas. TCEH, also a
disregarded entity, has approximately $24 billion of first lien debt (the TCEH Debt, the holders
of which are referred to herein as the TCEH Creditors),
3
as well as $7.7 billion of second lien
and unsecured debt. EFIHs principal asset is its indirect 80% membership interest in Oncor
Electric Delivery Co. LLC (Oncor), which it owns through Oncor Electric Delivery Holdings
LLC, a disregarded entity (Oncor Holdings). Oncor is a partnership for federal income tax
purposes and operates the largest transmission and distribution system in Texas. EFIH has
approximately $7.7 billion of first lien, second lien and unsecured debt (the holders of which are
referred to herein as the EFIH Creditors). EFH also has approximately $1.9 billion of debt
outstanding.
4
The chart below summarizes the existing structure of the relevant entities:

To fund the 2007 LBO (which was the largest LBO in history), EFH and certain of its
subsidiaries incurred substantial indebtedness, most of which currently resides at TCEH and
EFIH. EFH and its subsidiaries debt levels have become unsustainable since the LBO,
primarily because of rapid changes in the natural gas market that have caused a significant
reduction in electricity prices. As a result, EFH has been in negotiations with certain large
creditors for more than one year in an effort to restructure indebtedness of EFH and its
subsidiaries.

3
Excludes obligations under certain first lien hedging arrangements.
4
Includes approximately $1.3 billion of debt held by affiliate EFIH.
EFH
EFIH EFCH
Oncor
Holdings
TCEH
Oncor
DRAFT 4.28.14
3
508551 000027 9611307.15

In these negotiations, the parties focused on developing a consensual restructuring plan
that would achieve a sustainable capital structure and maximize the enterprise value of EFH and
its subsidiaries without causing a taxable break-up of the EFH tax group, which would trigger
significant tax liabilities at EFH. Unfortunately, no proposal garnered the necessary level of
support from the relevant stakeholders. Accordingly, despite more than a year of negotiations
and the development and consideration of numerous restructuring proposals, EFH and its
subsidiaries largest creditors were unable to reach an agreement on the terms of a restructuring
that would maintain the existing EFH consolidated group (including its disregarded entities).
The parties thus seemed destined to enter bankruptcy in April 2014 with no plan whatsoever,
with the likely outcome being a break-up of the EFH group with each creditor group foreclosing
on, or otherwise taking, its collateral (the assets of TCEH and EFIH) in taxable transactions. In
doing so, EFH would recognize taxable gain with respect to virtually all of these assets, perhaps
resulting in a tax liability in excess of $6 billion, with no ability to pay that tax. Indeed, EFH
began discussions with the IRS regarding the possible implications of such a massive unpaid,
uncollectible tax.

Within the last few weeks, a breakthrough occurred in the negotiations. The various
creditor groups have agreed to attempt to implement a transaction pursuant to which the EFH
group would be separated, but in a tax-free manner. More specifically, the idea is that TCEH
would transfer its assets to a new corporation (Spinco) that would then be distributed to the
TCEH Creditors in a tax-free spin-off. We believe that this transaction should be tax-free as a G
reorganization with a distribution occurring pursuant to Section 355. However, given the dollar
magnitude of the potential tax liability, the relative lack of private letter rulings or other
guidance regarding G reorganizations structured as spin-offs, and the unique issues presented by
the transaction (as described below), the parties agreed that such a transaction could not be
accomplished without an IRS ruling.

b. Proposed Transaction

Each of EFH, EFCH, TCEH and EFIH (and certain of their respective subsidiaries,
excluding Oncor Holdings and Oncor) filed a voluntary petition for relief under Chapter 11 of
the U.S. Bankruptcy Code with the U.S. Bankruptcy Court for the District of Delaware on April
__, 2014. As noted above, the filings were made pursuant to the RSA among the debtors, their
creditors and certain other parties. The agreement contemplates the tax-free spin-off of Spinco
but specifically conditions the transaction on the receipt of a ruling from the IRS concluding that
the proposed transactions qualify as a G reorganization and a distribution under Section 355.

The separation transaction contemplated by the RSA is as follows:

1. Before the effective date of the TCEH bankruptcy plan of reorganization (the TCEH
Plan), TCEH will form Spinco as a limited liability company under the laws of
Delaware, which will be a disregarded entity upon formation.

2. On or before such effective date, Spinco will issue new debt (the Spinco Debt) to third
parties (which may include the TCEH Creditors) for cash.
DRAFT 4.28.14
4
508551 000027 9611307.15

3. On such effective date, the TCEH Debt (and junior debt of TCEH) will be cancelled in
exchange for each creditors right to receive its recovery in accordance with the terms of
the TCEH Plan.

4. Immediately following such cancellation, pursuant to the TCEH Plan, TCEH will transfer
all of its assets and its ordinary course operating liabilities to Spinco in exchange for
which TCEH will receive (i) 100% of the newly-issued equity interests of Spinco and (ii)
the cash proceeds of the Spinco Debt. None of the TCEH Debt will be assumed by
Spinco (as all such debt will have been cancelled immediately prior to the transfer of
assets to Spinco pursuant to the TCEH Plan).

5. Immediately thereafter, Spinco will convert into a Delaware corporation pursuant to
Delawares conversion statute. For federal income tax purposes, the incorporation of
Spinco will be treated as if EFH contributed the Spinco assets to Spinco (a new
corporation), with Spinco assuming the Spinco Debt, in exchange for all of the stock of
Spinco (the Contribution). The Spinco Debt (together with other liabilities assumed by
Spinco) is expected to exceed the tax basis in the assets transferred to Spinco by an
amount approximately equal to EFHs net operating loss carryforwards (NOLs).

6. Immediately following the Contribution, TCEH will distribute all of the Spinco stock and
the cash proceeds from the Spinco Debt to the TCEH Creditors (the Distribution, and
together with the Contribution, the Reorganization). For federal income tax purposes,
because TCEH and EFCH are disregarded entities, EFH will be treated as having made
the Distribution to the TCEH Creditors.

The TCEH debt held by junior creditors (with a face amount of approximately $7.7
billion) will be cancelled in exchange for the recovery provided in the TCEH Plan. It is expected
that such creditors will receive a recovery of less than $350 million cash.

Under the EFIH bankruptcy plan, which will occur simultaneously with the TCEH Plan,
the first lien and second lien EFIH Creditors will receive a combination of new EFIH debt and
cash, as determined by negotiations among the parties. The unsecured EFIH Creditors will
receive EFH stock in a transaction that is expected to be treated as a recapitalization under
Section 368(a)(1)(E). It is currently contemplated that the unsecured EFIH Creditors will own
98% of the EFH stock immediately after the bankruptcy, subject to dilution for management
equity and the equity issuance described below.

The EFIH Creditors also may participate in and backstop an equity offering (or
convertible DIP loan) to raise approximately $2.1 billion in exchange for approximately 65% of
the EFH stock. The cash proceeds of the equity offering (or convertible DIP loan) will be used
to de-lever EFIH. It is anticipated that such transaction will occur immediately after the
exchange of the unsecured EFIH Creditors claims for EFH stock.

After all transactions described above have occurred, (i) the Spinco stock will be held
100% by the TCEH Creditors; and (ii) the EFH stock will be held 2% by the Sponsors and
DRAFT 4.28.14
5
508551 000027 9611307.15
unsecured EFH creditors and 98% by the unsecured EFIH Creditors, subject to dilution for
management equity and the approximate 65% equity issuance described above.

EFH believes that the Reorganization qualifies as a G reorganization and the Distribution
qualifies under Sections 355 and 356, as described in more detail below.
5

III. Analysis

a. Qualification as a G Reorganization

i. Generally

A G reorganization is statutorily defined generally as a transfer of assets by a corporation
to another corporation in a title 11 or similar case, but only if, in pursuance of the plan, stock or
securities of the transferee corporation are distributed in a transaction that qualifies under Section
354 (an acquisitive G reorganization), Section 355 (a divisive G reorganization) or Section 356.
6

The statutory requirements of a G reorganization should be satisfied here, provided that the
Distribution qualifies under Sections 355 and Section 356 (as discussed below), because EFH
(the sole owner of TCEH, which is a disregarded entity) is treated as transferring assets to Spinco
in the Contribution, which will occur in a bankruptcy case.
7

As with any reorganization under Section 368, a G reorganization also must satisfy the
nonstatutory business purpose, continuity of business enterprise (COBE) and continuity of
interest (COI) requirements.
8
The ruling request to be submitted will describe in detail the
satisfaction of these requirements under applicable authority. For purposes of this memorandum,
the focus is on the COI requirement, as this presents an area of uncertainty.

ii. Continuity of Interest

There is no authority regarding the application of the Section 368 COI requirement to
divisive G reorganizations (i.e., G reorganizations qualifying under Section 355). The Section
368 COI requirement does not apply to divisive D reorganizations in the same manner as to
acquisitive reorganizations, in that divisive D Reorganizations must effectively only satisfy the
Section 355 COI requirement (discussed below).
9
Divisive G reorganizations should be treated
similarly to divisive D reorganizations. Nevertheless, in the absence of prior guidance, the

5
The EFIH Creditors are considering an internal restructuring of EFH at or following emergence from bankruptcy
to maximize the value of EFH in the marketplace. Among the transactions being considered are (i) causing Oncor to
become a disregarded entity, either by purchasing the 20% minority interest or acquiring such interest for equity in
EFH, (ii) restructuring Oncor so as to permit EFH to qualify as a REIT, (iii) transferring certain of Oncors assets
into a separate partnership or (iv) causing EFIH to become a partnership. Any such transaction will be structured
such that the continuity of interest and active trade or business requirements for the Reorganization would be
satisfied.
6
I.R.C. 368(a)(1)(G).
7
There appear to be very few private letter rulings in which the IRS has ruled on a G reorganization qualifying
under Section 355. See, e.g., PLR 200345049 (Nov. 7, 2003).
8
Treas. Reg. 1.368-1(b), (c).
9
Treas. Reg. 1.368-1(b).
DRAFT 4.28.14
6
508551 000027 9611307.15
following discussion also analyzes the Section 368 COI requirement assuming that a divisive G
reorganization must satisfy such requirement in addition to the Section 355 COI requirement.
Although the Section 355 COI test may differ from the Section 368 COI test, ultimately the
analysis should be substantially the same as it relates to treating the creditors of an insolvent
corporation as holding a proprietary interest in the corporation before and, by virtue of
exchanging for shares, after the Distribution. In short, the Reorganization should satisfy the
Section 368 COI requirement (as well as the Section 355 COI requirement) because the TCEH
Creditors (and, for purposes of the Section 355 COI requirement, the unsecured EFIH Creditors)
should be treated as holding a proprietary interest in EFH prior to the Reorganization for
purposes of both COI tests.

Pursuant to the Treasury Regulations, COI requires that in substance a substantial part of
the value of the proprietary interests in the target corporation be preserved in the reorganization,
and that such a proprietary interest is preserved if it is exchanged for a proprietary interest in the
issuing corporation.
10
In the Reorganization, the TCEH Creditors will exchange the TCEH
Debt for stock of Spinco and cash. Because TCEH and EFCH are disregarded entities, the
TCEH Creditors are treated as creditors of EFH for federal income tax purposes. The Spinco
stock received by the TCEH Creditors clearly is a proprietary interest in Spinco (the issuing
corporation). Thus, the determination of whether the Section 368 COI requirement can be
satisfied in the Reorganization turns on whether the TCEH Creditors are treated as holding a
proprietary interest in EFH (the target corporation) before the Reorganization.

The seminal Alabama Asphaltic case stands for the proposition that, in certain
circumstances involving insolvent corporations, creditors of such corporation can be treated as
holding an equity (or proprietary) interest in such corporation.
11
COI Treasury Regulations
finalized in 2008 codify the principles of Alabama Asphaltic, providing as follows:

A creditor's claim against a target corporation may be a proprietary interest in the
target corporation if the target corporation is in a title 11 or similar case (as
defined in section 368(a)(3)) or the amount of the target corporation's liabilities
exceeds the fair market value of its assets immediately prior to the potential
reorganization. In such cases, if any creditor receives a proprietary interest in the
issuing corporation in exchange for its claim, every claim of that class of creditors
and every claim of all equal and junior classes of creditors (in addition to the
claims of shareholders) is a proprietary interest in the target corporation
immediately prior to the potential reorganization to the extent provided in
paragraph (e)(6)(ii) of this section.
12

10
Treas. Reg. 1.368-1(e)(1)(i).
11
Helvering v. Alabama Asphaltic Limestone Co., 315 U.S. 179 (1942).
12
Treas. Reg. 1.368-1(e)(6). Although separate continuity rules contained in Treas. Reg. 1.355-2(c) apply to
Section 355 transactions, this principle that creditors of an insolvent entity should be treated as owners should
continue to apply. Treas. Reg. 1.355-2(c) merely refers to one or more persons who, directly or indirectly, were
the owners of the enterprise prior to the distribution or exchange. This regulation is consistent with treating a
creditor as an owner for this purpose.
DRAFT 4.28.14
7
508551 000027 9611307.15
This regulation is consistent with the legislative history to the Bankruptcy Tax Act of
1980, Pub. L. 96-589, which states, the most senior class of creditors to receive stock, together
with all equal and junior classes (including shareholders who receive any consideration for their
stock), should generally be considered the proprietors of the insolvent corporation for
continuity purposes. S Rep. 96-1035, 96th Cong., 2d Sess. at 36-37, 1980-2 C.B. 620, 639
(1980).
13

By virtue of TCEH and EFCH being disregarded entities, the TCEH Creditors claims are
treated as claims against EFH (the target corporation) for tax purposes. Pursuant to the above
Treasury Regulations, the TCEH Creditors (and junior creditors) should be treated as holding a
proprietary interest in EFH immediately before the Reorganization because EFH is in a
bankruptcy case and the amount of its liabilities exceeds the fair market value of its assets.

Once the TCEH Creditors and junior creditors are treated as proprietary interest holders
in EFH, COI is determined by examining the mix of consideration received by the TCEH
Creditors and junior creditors. For this purpose, it is assumed that the Spinco stock received by
the TCEH Creditors will have a fair market value of approximately $10 billion.
14
Comparing
such stock to the $350 million cash received by the junior creditors results in over 96% COI,
more than sufficient to satisfy the Section 368 COI requirement.
15

Because COI should be satisfied, the Reorganization should qualify as a G
reorganization, provided that the Distribution otherwise qualifies under Sections 355 and Section
356.

iii. Tax Consequences to EFH and Spinco

Under Section 361(a), EFH recognizes no gain or loss upon the exchange of property
pursuant to the Reorganization solely in exchange for stock in Spinco. Notwithstanding the
nonrecognition rule in Section 361(a), Section 357(c) can cause the transferor corporation to
recognize gain to the extent that liabilities assumed by the transferee corporation exceed the tax
basis of the assets transferred.
16

Accordingly, if the amount of liabilities assumed by Spinco from TCEH in the
Contribution exceed the basis of the assets transferred (as is expected), EFH generally would be
required to recognize gain under Section 357(c)(1). However, Section 357(c)(2)(B) provides an
exception from such rule in the case of G reorganizations in which no former shareholder of the

13
See also Atlas Oil v. Commr, 36 T.C. 675 (1961); Rev. Rul. 59-222, 1959-1 C.B. 80.
14
Under the formula set forth in Treas. Reg. 1.368-1(e)(6)(ii)(A), only the value of the TCEH Creditors claims
that are exchanged for Spinco stock are taken into account in determining the value of the proprietary interest in
EFH held by such creditors. Thus, the cash received by TCEH Creditors does not count against the COI percentage.
15
COI = $10B / ($10B + $350M) = 96.6%
16
Although Section 357(c) generally is turned off in the consolidated group context under Treasury Regulations
Section 1.1502-80(d), it is not turned off when either the transferor or transferee becomes a nonmember as a part of
the same plan or arrangement. Here, Spinco is either never a member of the group or will become a nonmember as
part of the Reorganization, and thus, Treasury Regulations Section 1.1502-80(d) does not turn off Section 357(c).
(See requested ruling #10 below.)
DRAFT 4.28.14
8
508551 000027 9611307.15
transferor corporation receives any consideration for his stock. In this case, the Sponsors will
retain a small amount of stock in the distributing corporation and, therefore, Section 357(c)(2)(B)
will not apply.

The Reorganization will be structured to trigger some gain under Section 357(c),
achieving a partial step-up in the basis of the assets held by Spinco after the Reorganization.
17
It
is contemplated that the amount of gain triggered would not exceed the NOLs available to offset
such gain. Upon the Contribution, EFH will be treated as contributing the assets to Spinco and
Spinco will be treated as assuming the Spinco Debt, which will exceed the tax basis of the assets
transferred. As long as Section 357(c)(2)(B) does not apply, the excess liabilities assumed will
trigger gain under Section 357(c). In such a case, EFH will recognize gain to the extent of such
excess, providing Spinco with a partially stepped up basis in the assets.
18
Separately, the TCEH
Debt will be cancelled prior to the Contribution. Therefore, such debt will not be treated as
assumed by Spinco for purposes of Section 357.

b. Qualification Under Section 355

i. Generally

Under Section 355(a) and (c), provided certain requirements are met, a distributing
corporation may distribute stock or securities of a controlled subsidiary to its shareholders and
security holders without causing either the distributing corporation or its shareholders and
security holders to recognize income, gain, or loss. In order to qualify for tax-free treatment
under Section 355, certain statutory requirements and nonstatutory requirements must be
satisfied. The ruling request to be submitted will elaborate on all of those requirements.
19
For
purposes of this memorandum, the focus is on the issues which are not adequately addressed by
existing guidance and are critical to obtaining the requested rulings.

ii. TCEH Debt As Securities For Purposes of Section 355

Key to the satisfaction of Section 355 is that the TCEH Debt constitutes securities for
purposes of Section 355. The TCEH Debt was originally issued in 2007 with a 2014 maturity
date. A large portion of the debt was subject to a significant modification in 2011, which was
treated as a deemed exchange for federal income purposes under Treasury Regulations Section
1.1001-3. As part of this modification, the maturity date was extended to 2017. Whether the
security determination is made in 2007 or 2011, the TCEH Debt should be treated as securities.

iii. The Device Requirement

17
The TCEH Creditors support for the proposed transaction (rather than seeking a taxable asset transfer) was
premised on Spincos ability to increase the tax basis of the assets it would hold by an amount equal to the gain that
EFH would recognize.
18
I.R.C. 357(c)(1) (flush language), 362(b).
19
For example, both the distributing (EFH) and controlled (Spinco) corporations (or members of a separate
affiliated group, as defined in Section 355(b)(3)) have been engaged in active businesses for more than five years,
and control of such corporations conducting such businesses has not been acquired by EFH (distributing) in taxable
transactions within that five-year period.
DRAFT 4.28.14
9
508551 000027 9611307.15

Treasury Regulation Section 1.355-2(d)(1) provides that Section 355 does not apply to a
transaction used principally as a device for the distribution of the earnings and profits of the
distributing corporation, the controlled corporation, or both.
20
Notwithstanding the absence of
authority in the context of a divisive G reorganization, the device requirement should not apply
to a distribution to creditors because such a distribution cannot be taxed as a dividend, and thus,
has no potential to convert a dividend to capital gain.
iv. The COI Requirement

After the Distribution, Spinco stock will be owned 100% by the TCEH Creditors, and
EFH stock will be owned 100% by the Sponsors, unsecured EFH creditors and the unsecured
EFIH Creditors. Ownership of 100% of the stock of Spinco clearly is a sufficient percentage of
ownership to establish a continuity of interest. The determination of whether COI is satisfied
under Section 355 turns on whether the TCEH Creditors and the unsecured EFIH Creditors are
considered owners of the enterprise (i.e., owners of EFH) prior to the Distribution.
21

The same Section 368 principles of treating creditors as proprietary interest holders in the
bankruptcy or insolvency context also should apply for Section 355 COI purposes.
Commentators agree that the Section 368 and Section 355 COI principles should be applied
similarly:

Given the difficulty of understanding why [COI] principles
should apply differently in the section 355 context and the
safeguards of the device requirement, section 355(d), and section
355(e), the authors believe that Reg. 1.355-2(c) should be modified
to adopt similar principles to those contained in Reg. 1.368-1(e).
22

Thus, because the TCEH Creditors should be treated as holding a proprietary interest in
EFH for Section 368 purposes (as discussed above), such creditors also should be treated as
owners of the enterprise for Section 355 COI purposes. The same analysis holds true for the
unsecured EFIH Creditors and the unsecured EFH creditors. Thus, because the TCEH Creditors
will own 100% of Spinco, and the Sponsors, unsecured EFH creditors and unsecured EFIH
Creditors will own 100% of EFH, after the Distribution, the Section 355 COI requirement should
be satisfied.

After the Distribution, EFH expects to issue approximately 65% of its stock for $2.1
billion. However, such stock offering does not decrease the value of the interest in EFH held by

20
Treas. Reg. 1.355-2(d)(1).
21
Treas. Reg. 1.355-2(c) provides that the COI requirement in the context of a distribution under Section 355 is
satisfied if one or more persons who, directly or indirectly, were the owners of the enterprise prior to the
distribution own, in the aggregate, an amount of stock establishing continuity of interest in each of the distributing
and controlled corporation.
22
Thomas F. Wessel, Joseph M. Pari, and Richard DAvino, Corporate Distributions Under Section 355, TAX
STRATEGIES FOR CORPORATION ACQUISITIONS, DISPOSITIONS, DISTRIBUTIONS, JOINT VENTURES, FINANCINGS,
REORGANIZATIONS AND RESTRUCTURINGS (PLI 2014).
DRAFT 4.28.14
10
508551 000027 9611307.15
the unsecured EFIH Creditors, the Sponsors and the unsecured EFH creditors and therefore
should not impact COI.

v. Section 355(d)

Even if a distribution otherwise qualifies under Section 355, Section 355(d) requires
recognition of corporate-level gain by a distributing corporation if a distribution of subsidiary
stock or securities is a disqualified distribution.
23
A disqualified distribution is a distribution
to which Section 355 otherwise applies if, immediately after the distribution, any person holds
a 50%-or-greater interest in either the distributing or controlled corporation consisting of
disqualified stock.
24
Generally, disqualified stock is (i) stock in the distributing or controlled
corporation purchased within the 5-year period preceding the distribution, (ii) stock in the
controlled corporation received in the distribution with respect to disqualified stock in the
distributing corporation, or (iii) stock in the controlled corporation received in the distribution
with respect to securities in the distributing corporation purchased within such 5-year
period.
25
Generally, stock is purchased if acquired in a transaction other than a carryover basis
transaction or a Section 351, 354, 355 or 356 transaction.
26

Even assuming that the Spinco or EFH stock is disqualified stock, Section 355(d)
requires that a single person hold the requisite percentage of disqualified stock immediately after
the distribution. No single TCEH Creditor will hold 50% or more of the stock in Spinco after the
Distribution. Nor will any single unsecured EFIH Creditor hold 50% or more of EFH after the
Distribution. However, Section 355(d)(7)(B) treats a group of persons acting pursuant to a plan
or arrangement as a single person. The Treasury Regulations elaborate on Section 355(d)(7)(B),
specifically providing that the receipt of stock by creditors in satisfaction of debt in a bankruptcy
case does not cause the group of creditors to be treated as acting pursuant to a plan or
arrangement under Section 355(d)(7)(B).
27
Thus, neither the TCEH Creditors nor the unsecured
EFIH Creditors should be treated as a single person under Section 355(d)(7)(B). Accordingly,
Section 355(d) should not apply to the Distribution.

Also, EFH expects to issue stock representing an approximate 65% interest in EFH after
the Distribution. Section 355(d) should not apply to such a post-Distribution equity offering.
Further, no single purchaser of stock in the offering will own 50% or more of EFH and such
purchasers should not be aggregated under Section 355(d).

c. Section 355(e)

The exception to Section 355(e) under Section 355(e)(4)(B) should apply because the
Distribution will be made in a title 11 case. Accordingly, none of the Distribution, any pre-

23
I.R.C. 355(d)(1).
24
I.R.C. 355(d)(2).
25
I.R.C. 355(d)(3).
26
I.R.C. 355(d)(5)(A).
27
Treas. Reg. 1.355-6(c)(4)(ii).
DRAFT 4.28.14
11
508551 000027 9611307.15
closing trading of EFH debt, or post-closing trading of EFH or Spinco stock should trigger
Section 355(e).

d. Treatment of Spinco as Nonmember of EFH Consolidated Group

Treasury Regulations Section 1.1502-6(a) provides that the common parent and each
subsidiary which was a member of the group during any part of the consolidated return year
shall be severally liable for the tax for such year. Treasury Regulations Section 1.1502-76(b)
provides that when a corporation becomes a member of a group during a consolidated return
year, it becomes a member of the group as of the end of the day on which it becomes a member.
Here, Spinco becomes a corporation owned by EFH and immediately thereafter becomes wholly-
owned by the TCEH Creditors before the end of a single day. Accordingly, Spinco is not a
member of the EFH consolidated group at the end of such day, the time at which it would be
treated as a member of the group under Treasury Regulations Section 1.1502-76(b).
28
Because
Spinco is not a member of the group at such time, it should not be treated as ever becoming a
member of the group.

e. Allocation of EFH Earnings and Profits to Spinco

Section 312(h) provides that in a distribution or exchange to which Section 355 applies,
allocation of the earnings and profits (E&P) of the distributing corporation and the controlled
corporation shall be made under regulations prescribed by the Secretary. Treasury Regulations
Section 1.312-10(a) provides that if a corporation transfers part of its assets constituting an active
trade or business to a newly-created controlled corporation in a D reorganization and distributes
the stock and securities of the controlled corporation in a distribution to which Section 355
applies, the E&P of the distributing corporation immediately before the transaction shall be
allocated between the distributing corporation and the controlled corporation in proportion to the
fair market value of the business or businesses (and interests in any other properties) retained by
the distributing corporation and the business or businesses (and interests in any other properties)
of the controlled corporation immediately after the transaction.

Treasury Regulations Section 1.312-10(b) provides for a different E&P allocation in the
case of a Section 355 distribution of the stock or securities of an existing corporation (i.e., a
Section 355 distribution that is not part of a D reorganization). Although the application of
Treasury Regulations Section 1.312-10(a) is limited on its face to a Section 355 distribution as
part of a D reorganization, a G reorganization is closely analogous to a D reorganization and the
method under such regulation also should apply in the case of a Section 355 distribution in a G
reorganization. Further, any equity offering by EFH that occurs immediately after the
Reorganization (including the conversion of the DIP loan into EFH stock) should not be taken
into account for purposes of allocating EFHs E&P to Spinco because the proceeds of such an
offering are not part of the business or businesses (or interests in any other properties) retained
by EFH following the Distribution.

28
We note that Treas. Reg. 1.1502-76(b)(1)(ii)(C) treats a successor to a member as a member from the
beginning of its existence. Such regulation should not apply, however, where momentary affiliation prevents a
potential successor from becoming a member of the group.
DRAFT 4.28.14
12
508551 000027 9611307.15
f. Impact on 2013 Private Letter Ruling

In April 2013, EFH effected an internal restructuring (the 2013 Reorganization) to
eliminate an approximate $20 billion excess loss account (ELA) and an approximate $5 billion
deferred intercompany gain (DIG) with respect to the stock of EFCH, which was a corporation
at the time. The 2013 Reorganization was the subject of PLR 201326006. In PLR 201326006,
the Service ruled, among other things, that as a result of a downstream merger, the ELA was
eliminated without the recognition of gain under Treasury Regulations Section 1.1502-19(b)(2)
and the DIG was redetermined to be excluded from income under Treasury Regulations Section
1.1502-13(c)(6)(ii)(C).

At the time of the 2013 Reorganization, the nature of any debt restructuring of the EFH
group was unknown. Specifically, it was not known (i) whether such a restructuring may have
occurred in or out of a bankruptcy proceeding, (ii) whether TCEH assets or equity may be
transferred to the TCEH Creditors, (iii) whether any EFH equity may be issued to any creditors
of EFH and/or TCEH, or (iv) which entities may be included in any such restructuring.
However, it was certain that the existence of the ELA and the DIG prevented any type of debt
restructuring and the 2013 Reorganization was key to proceeding with a debt restructuring. The
Reorganization should not adversely impact the conclusion of PLR 201326006.

IV. Requested Rulings

EFH intends to request the following rulings in the Ruling Request:

1. The Reorganization qualifies as a G reorganization and the Distribution qualifies under
Sections 355 and 356.
29

2. The TCEH Creditors and the unsecured EFIH Creditors are treated as owners of the
enterprise for purposes of the Section 355 COI requirement.

3. The TCEH Creditors are treated as holding a proprietary interest in EFH prior to the
Reorganization for purposes of Section 368(a)(1)(G) and the COI requirement of a G
reorganization is satisfied (or alternatively, that the Reorganization need only satisfy the
Section 355 COI requirement).

4. The device requirement under Section 355(a)(1)(B) does not apply to the Distribution.

5. The TCEH Debt constitutes securities of EFH for purposes of Section 355 and Section
368(a)(1)(G).

29
Notwithstanding the IRS ruling policy set forth in Rev. Proc. 2013-32, the proposed transaction is conditioned on
the receipt of a ruling regarding the qualification of the Reorganization under Sections 368 and 355. The unique
nature of the transaction and the lack of guidance on divisive G reorganizations have made the parties unwilling to
proceed without such a ruling. In the words of the revenue procedure, the treatment of the transaction as a G
reorganization and a Section 355 distribution is essentially not free from doubt even if the sub-issues described
above are addressed by the ruling.
DRAFT 4.28.14
13
508551 000027 9611307.15
6. The EFIH debt held by the unsecured EFIH Creditors constitutes securities of EFH for
purposes of Section 368(a)(1)(E).

7. Neither the TCEH Creditors nor the unsecured EFIH Creditors will be aggregated for
purposes of Section 355(d).

8. The bankruptcy exception to Section 355(e) applies to the Distribution, any pre-
Distribution trading of EFH debt, and post-Distribution trading of EFH and Spinco stock.

9. EFH recognizes gain under Section 357(c) to the extent that the Spinco Debt and other
liabilities assumed by Spinco exceed the tax basis of assets transferred to Spinco in the
Contribution, and Spincos basis in the former TCEH assets is increased by the amount of
such gain under Section 362(b).

10. The TCEH Debt is not treated as assumed by Spinco for purposes of Section 357(c) and
(d).

11. Spinco is not treated as ever having been a member of the EFH consolidated group.

12. EFHs earnings and profits will be allocated between EFH and Spinco pursuant to
Treasury Regulations Section 1.312-10(a) in proportion to the fair market value of the
business or businesses (and interests in any other properties) retained by EFH and the
business or businesses (and interests in any other properties) of Spinco immediately after
the Distribution.

13. Any equity offering by EFH that occurs immediately after the Reorganization (including
the conversion of the EFIH DIP loan into EFH stock) will not be taken into account for
purposes of allocating EFHs earnings and profits to Spinco.

14. The Reorganization will not affect the prior ruling received by EFH regarding the 2013
Reorganization.

EXHIBIT F

TCEH DIP TERM SHEET

MILBANK DRAFT 4/25/14

#4819-5662-6966
Exhibit A

TEXAS COMPETITIVE ELECTRIC HOLDINGS COMPANY LLC
SUMMARY OF TERMS AND CONDITIONS OF THE $4,475,000,000
SENIOR SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION FACILITIES
(TERM SHEET)

Capitalized terms used but not defined in this Exhibit A will have the meanings set forth in the Commitment Letter
to which this Exhibit A is attached.
Borrower and other debtor-in-
possession subsidiaries:
Texas Competitive Electric Holdings Company LLC (TCEH or the
Borrower), as a debtor-in-possession under Chapter 11 of the United
States Bankruptcy Code (the Bankruptcy Code) and certain of its
subsidiaries as debtors-in-possession under the Bankruptcy Code in
jointly administered cases (collectively the Cases) in the United
States Bankruptcy Court for the District of Delaware (such court,
together with any other court having exclusive jurisdiction over the
Cases from time to time and any Federal appellate court thereof, the
Bankruptcy Court).
Guarantors: All obligations under the DIP Facilities (defined below) and the other
Loan Documents (defined below) will be unconditionally guaranteed by
(a) Energy Future Competitive Holdings Company LLC (EFCH), as
parent guarantor (the Parent Guarantor) and (b) each subsidiary of
the Borrower that is currently a guarantor under the Prepetition TCEH
Credit Facility (defined below), as subsidiary guarantors (each a
Subsidiary Guarantor and, collectively with the Parent Guarantor,
the Guarantors), subject, in each case of other subsidiaries that may
be required to become guarantors under the Loan Documents, to clause
(ii) of Priority/Security below, covenant restrictions in joint venture
agreements, general statutory limitations, corporate benefit and similar
principles under applicable law, contractual restrictions and to the extent
such guarantee would not result in adverse tax or accounting
consequences, as reasonably determined by the Borrower, or as will
require that such guarantee be limited by an amount or otherwise
(collectively, Applicable Limitations) to the extent of such
Applicable Limitations, or as otherwise agreed by the Joint Lead
Arrangers (defined below) and the Borrower (collectively, the
Guarantee).
All Guarantors shall also be debtors-in-possession under the Bankruptcy
Code (such Guarantors, together with the Borrower, collectively the
Debtors).
Debtors: The Debtors are: (i) the Borrower, (ii) the Parent Guarantor and (iii) the
subsidiaries of the Borrower identified on Annex I hereto.

2
#4819-5662-6966
Prepetition Secured Facilities: The following are collectively referred to as the Prepetition Secured
Facilities: (i) the Credit Agreement, dated as of October 10, 2007,
among EFCH, TCEH, Citibank N.A., as administrative and collateral
agent (the Prepetition First Lien Agent), and the other parties thereto
(as amended, modified or supplemented and in effect prior to the
Petition Date, the Prepetition TCEH Credit Facility);
(ii) the 11.5% senior secured notes due October 1, 2020, issued under
the indenture dated April 19, 2011, by and among TCEH and TCEH
Finance, Inc., as issuers, The Bank of New York Mellon Trust
Company, N.A. (BNY), as indenture trustee, EFCH and certain
subsidiary obligors party thereto, as guarantors (the First Lien Secured
Notes);
(iii) (a) certain obligations to the Debtors counterparties under certain
first lien commodity hedges (the First Lien Commodity Hedges);
and (b) certain obligations to the Debtors counterparties under first lien
interest rate swaps (the First Lien Interest Rate Swaps, and together
with the Prepetition TCEH Credit Facility, the First Lien Secured Notes
and the First Lien Commodity Hedges, the Prepetition First Lien
Debt), as provided in the Prepetition TCEH Credit Facility and the
Restated Collateral Agency and Intercreditor Agreement dated as of
October 10, 2007, as amended and restated as of August 7, 2009 (as
amended, and in effect from time to time, the First Lien Intercreditor
Agreement); and
(iv) the 15% senior secured second lien notes due April 1, 2021 and 15%
senior secured second lien notes due April 1, 2021, Series B, issued
under the indenture dated October 6, 2010, by and among TCEH and
TCEH Finance, Inc., as issuers, BNY, as indenture trustee and collateral
agent (the Prepetition Second Lien Agent), EFCH and certain
subsidiary obligors party thereto, as guarantors, and supplemental
indentures thereto (the Prepetition Second Lien Debt).
Eligible Pari Passu Hedges: The Borrower shall be entitled to grant liens in the Collateral (defined
below) to counterparties under certain right-way hedging agreements
that are pari passu to the liens securing the DIP Facilities (the Eligible
Pari Passu Hedges).
DIP Facilities: (a) Revolver Facility: A superpriority non-amortizing revolving credit
facility (the Revolver Facility) in an aggregate principal amount of
$1,950,000,000 (the Revolver Commitments). Up to $800,000,000
of the Revolver Facility will be available in connection with Initial
Availability (defined below) and up to $1,950,000,000 will be available
in connection with Full Availability (defined below), in each case
subject to the Revolver Commitments, in the form of loans for the
account of the Debtors (Revolver Loans).

(b) Delayed-Draw Term Facility: A superpriority non-amortizing
delayed draw term credit facility (the Delayed-Draw Term Facility)
in an aggregate principal amount of $1,100,000,000 (the Delayed-

3
#4819-5662-6966
Draw Term Commitment) shall be made available for up to two
drawings (in minimum amounts of $250,000,000 (or the remainder of
the Delayed Draw Term Commitment, if less than $250,000,000))
during the period beginning on the Closing Date (it being understood
and agreed that the Initial Availability for the Delayed-Draw Term
Facility shall equal the full Delayed-Draw Term Commitment) and
ending on the date that is 90 days after the Closing Date (the Delayed-
Draw Termination Date), but only if the Borrower shall have
theretofore issued and delivered the RCT Carve Out Support Rejection
Notice (as defined below), for (i) the purpose of making loans to the
Borrower to provide cash collateral to support obligations of the Debtors
(or to refinance any cash collateral previously provided by the Debtors)
to the Railroad Commission of Texas and/or (ii) working capital, general
corporate and other purposes permitted under Purpose: Use of
Proceeds below (collectively, the Delayed-Draw Term Loans).
Amounts drawn under the Delayed-Draw Term Facility may not be
reborrowed once repaid; provided that the Borrower will be under no
obligation to elect to reduce the Delayed-Draw Term Commitments or
the size of the Delayed-Draw Term Facility. Upon being drawn,
Delayed-Draw Term Loans shall be deemed to constitute the same loan
tranche as the Term Loans and shall have the same terms as the Term
Loans.
The Delayed-Draw Term Facility shall be permanently reduced (dollar-
for-dollar) by an amount (the Delayed-Draw Term Facility
Reduction Amount) equal to the difference between $1,100,000,000
and the amount of Delayed-Draw Term Loans actually requested by and
provided to the Borrower on the earlier of (1) the date of drawing of all
of the Delayed-Draw Term Commitments and (2) the Delayed-Draw
Termination Date (such earlier date, the Delayed-Draw Term Facility
Reduction Date).
(c) Term Loan Facility: A superpriority non-amortizing term credit
facility (the Term Facility) in an aggregate principal amount of
$1,425,000,000 (the Term Commitments). Up to $800,000,000 of
the Term Facility in connection with Initial Availability and up to
$1,425,000,000 in connection with Full Availability, in each case
subject to the Term Commitments, will be available in the form of loans
for the account of the Debtors (Term Loans and, together with the
Revolver Loans and the Delayed-Draw Term Loans, the Loans). Up
to $800,000,000 of the proceeds of the Term Loans may be applied by
the Borrower to fund the General L/C Cash Collateral Account (as
defined below). Amounts drawn under the Term Facility may not be re-
borrowed once repaid.
General L/C Cash Collateral
Account:
To the extent so requested by the Borrower at its election, proceeds of
the Term Facility may be deposited in one or more segregated
depositary accounts under the name of the Borrower (collectively, the
General L/C Cash Collateral Account) to be subject to a first
priority lien in favor of the Lenders and the other secured parties under
the DIP Facilities and the General Letter of Credit Issuers (as defined

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#4819-5662-6966
below) and shall be invested in cash and cash equivalents as directed by
the Borrower (with any such gains or losses being for the account of the
Borrower). For the avoidance of doubt, the commitment of the General
Letter of Credit Issuers to issue General Letters of Credit shall not
exceed the maximum stated amount set forth below under General
Letter of Credit Issuers.

The Borrower may at any time draw any funds in the General L/C Cash
Collateral Account to the extent of the excess of such funds over the
then aggregate undrawn amount of all General Letter of Credit plus the
amount of unreimbursed drawings on General Letters of Credit;
provided that the relevant General Letter of Credit Issuers shall have no
obligation to issue General Letters of Credit in excess of the funds in the
General L/C Cash Collateral Account. Any General Letter of Credit
shall have the expiration dates (and renewal terms) agreed to with the
relevant General Letter of Credit Issuer.
General Letters of Credit: Drawings under General Letters of Credit shall be reimbursed by the
Borrower (whether with its own funds or, at its election, with the
proceeds in the General L/C Cash Collateral Account within one
(1) business day of receipt of written notice from the Administrative
Agent (as defined below) or the relevant General Letter of Credit Issuer
to the effect that a General Letter of Credit has been drawn upon.
To the extent that the Borrower does not so reimburse the General Letter
of Credit Issuer in respect of any General Letter of Credit, the General
Letter of Credit Issuer may draw in its discretion any balances on
deposit in the General L/C Cash Collateral Account in an amount up to
such reimbursement obligation.
RCT L/C Cash Collateral
Account:
To the extent so requested by the Borrower at its election, proceeds of
the Delayed-Draw Term Facility shall be funded directly to one or more
segregated depositary accounts under the name of the Borrower
(collectively, the RCT L/C Cash Collateral Account) to be subject
to a first priority lien in favor of the Lenders and the other secured
parties under the DIP Facilities and the RCT Letter of Credit Issuers (as
defined below) and shall be invested in cash and cash equivalents as
directed by the Borrower (with any such gains or losses being for the
account of the Borrower). The Borrower may also draw Delayed-Draw
Term Loans and use the proceeds thereof as permitted under
Purpose/Use of Proceeds below. The RCT L/C Cash Collateral
Account shall not be funded with proceeds of the Revolver Facility until
the Term Facility and the Delayed-Draw Term Facility have been fully
funded (or, in the case of the Delayed-Draw Term Facility, the Delayed-
Draw Term Facility Reduction Date has occurred). For the avoidance of
doubt, the commitment of the RCT Letter of Credit Issuers to issue RCT
Letters of Credit shall not exceed the maximum stated amount set forth
below under RCT Letter of Credit Issuers.

The Borrower may at any time draw any funds in the RCT L/C Cash
Collateral Account to the extent of the excess of such funds over the

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#4819-5662-6966
then aggregate undrawn amount of all RCT Letter of Credit plus the
amount of unreimbursed drawings on RCT Letters of Credit; provided
that (x) the relevant RCT Letter of Credit Issuers shall have no
obligation to issue RCT Letters of Credit in excess of the funds in the
RCT L/C Cash Collateral Account and (y) such drawn amounts may not
be used for any purpose other than prepaying the Term Loans or the
Delayed-Draw Term Loans. Any RCT Letter of Credit shall have the
expiration dates (and renewal terms) agreed to with the relevant RCT
Letter of Credit Issuer.

RCT Letters of Credit: Drawings under RCT Letters of Credit shall be reimbursed by the
Borrower (whether with its own funds or, at its election, with the
proceeds in the RCT L/C Cash Collateral Account within one
(1) business day of receipt of written notice from the Administrative
Agent or the RCT Letter of Credit Issuers to the effect that a RCT Letter
of Credit has been drawn upon.
Upon a drawing under an RCT Letter of Credit, the applicable RCT
Letter of Credit Issuer will draw any balances on deposit in the RCT L/C
Cash Collateral Account in an amount up to the Borrowers
reimbursement obligation.
Purpose/Use of Proceeds: The proceeds of the Term Loans and the Revolver Loans will be used, in
a manner consistent with the terms of the Budget (defined below): (i) to
finance any and all working capital needs and for any other general
corporate purposes, including without limitation, to provide collateral
support in respect of financial or physical trading transactions, including
commodities transactions, and to comply with any legal and/or
regulatory requirements of governmental and quasi-governmental
entities (including for posting bonds and remediation or reclamation
obligations of any nature, complying with any statutory or regulatory
requirements and for self-bonding in respect of permits and licenses) of
the Debtors, (and, to the limited extent set forth below, of the Specified
Affiliates), (ii) to provide for Letters of Credit and (iii) to pay related
transaction costs, fees, liabilities and expenses (including all
Professional Fees (defined below)) and other administration costs
incurred in connection with the Cases (including Adequate Protection
Payments (defined below)) and the commitment, negotiation,
syndication, documentation (including any commitment letters),
execution and closing of the DIP Facilities. The proceeds of the
Delayed-Draw Term Loans will be used to fund the RCT L/C Cash
Collateral Account. Up to $800,000,000 of the proceeds of the Term
Facility may be used to fund the General L/C Cash Collateral Account.
The General Letters of Credit may be used for general corporate
purposes, including without limitation, providing collateral support in
respect of financial or physical trading transactions, including
commodities transactions related to the Debtors businesses and
activities (and, to the limited extent set forth below, of the Specified
Affiliates) and to comply with any legal and/or regulatory requirements
of governmental and quasi-governmental entities (including for posting
bonds and remediation or reclamation obligations of any nature (such as

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with the Railroad Commission of Texas (the RCT)) complying with
any statutory or regulatory requirements and for self-bonding in respect
of permits and licenses). The RCT Letters of Credit will be used for the
purpose of satisfying bonding requirements of the RCT.
Left Lead Revolving Arranger: Deutsche Bank Securities Inc. (the Left Lead Revolving Arranger).
Left Lead Term Facilities
Arranger:
Citigroup Global Markets Inc. (the Left Lead Term Facilities
Arranger and, together with the Left Lead Revolving Arranger, the
Left Lead Arrangers).
Joint Lead Arrangers: The Left Lead Term Facilities Arranger, the Left Lead Revolving
Arranger, Merrill Lynch, Pierce, Fenner & Smith Incorporated
(MLPFS), Morgan Stanley Senior Funding, Inc. (Morgan
Stanley), Barclays Bank PLC (Barclays), RBC Capital Markets
(RBCCM), and Union Bank, N.A. (Union Bank, and together with
the Left Lead Term Facilities Arranger, the Left Lead Revolving
Arranger, MLPFS, Morgan Stanley, Barclays and RBCCM, collectively,
the Joint Lead Arrangers).
DIP Facilities Commitments
and Lenders:
The Revolver Facility, the Delayed-Draw Term Facility and the Term
Facility (together with the Incremental Facilities, if any) are collectively
referred to as the DIP Facilities. The lenders under the Revolver
Facility are referred to as the Revolver Lenders, the lenders under the
Delayed-Draw Term Facility are referred to as the Delayed-Draw
Term Lenders and the lenders under the Term Facility are referred to
as the Term Lenders. The Revolver Lenders, the Delayed-Draw
Term Lenders and the Term Lenders (together with any lenders under
the Incremental Facilities, if any) are collectively referred to as the
Lenders. The Revolver Commitments, the Delayed-Draw Term
Commitments and the Term Commitments are collectively referred to as
the Commitments.
General Letter of Credit
Issuers:
Citi and other mutually and reasonably satisfactory banks (the General
Letter of Credit Issuers) shall provide for the issuance of General
Letters of Credit cash collateralized with the proceeds in the General
L/C Cash Collateral Account (the General Letters of Credit) in an
aggregate stated amount of up to $800,000,000, which amount may be
increased from time to time as may be agreed between the Borrower and
the relevant General Letter of Credit Issuers.
RCT Letter of Credit Issuers: Each of the initial Revolver Lenders, pro rata in proportion to their
Revolver Commitments, and other mutually and reasonably satisfactory
banks (the RCT Letter of Credit Issuers and together with the
General Letter of Credit Issuers, the Letter of Credit Issuers) shall
provide for the issuance of RCT Letters of Credit cash collateralized
with the proceeds in the RCT L/C Cash Collateral Account (the RCT
Letters of Credit and together with the General Letters of Credit, the
Letters of Credit) in an aggregate stated amount of up to
$1,100,000,000, but only if the Borrower shall have theretofore issued
and delivered the RCT Carve Out Support Rejection Notice prior to the

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Delayed-Draw Termination Date.
Administrative Agent: Citibank, N.A. (together with its permitted successors and assigns, the
Administrative Agent or Agent).
Initial Availability: During the period commencing on the date (the Interim Order Entry
Date) of the Bankruptcy Courts entry of the Interim Order (defined in
Annex II attached hereto) and ending on the date the Bankruptcy Court
enters the Final Order (defined in Annex II attached hereto) (such
period, the Interim Period), the Commitments shall be available to
the Borrower, subject to (i) delivery by the Debtors of a Budget (defined
below) and (ii) compliance with the applicable terms, conditions and
covenants described in this Term Sheet in an amount as follows:
1. Revolver Facility, $800,000,000;
2. Delayed-Draw Term Facility, $1,100,000,000; and
3. Term Facility, $800,000,000, or, in each case such other amount as
may be approved by order of the Bankruptcy Court, to be made
available during the Interim Period in accordance with the Budget (the
Initial Availability).
DIP Facilities Full Availability: Upon the Bankruptcy Courts entry of the Final Order (the Final
Order Entry Date), the full amount of the Commitments shall be
available to the Borrower subject to compliance with the applicable
terms, conditions and covenants described in this Term Sheet (the Full
Availability). Subject to the terms hereof, the balance of the DIP
Facilities may be borrowed in amounts, and at intervals, to be set forth
in the Loan Documents.
Incremental Facilities: The Borrower shall be entitled to enter into one or more incremental
term loan facilities (the Incremental Term Facility) and/or one or
more Incremental Revolver facilities (the Incremental Revolver
Facility and, together with the Incremental Term Facility, the
Incremental Facilities) that will rank pari passu in right of payment
with the Revolver Facility, the Delayed-Draw Term Facility and the
Term Facility and will have the same guarantees as, and be secured on a
pari passu basis by the same Collateral securing, the Revolver Facility,
the Delayed-Draw Term Facility and the Term Facility, in a principal
amount allocated between the Incremental Facilities determined by the
Borrower (x) in minimum amounts of at least $100,000,000 and (y) not
to exceed the sum of (1) $750,000,000 plus (2) if the RCT Carve Out
Support Rejection Notice shall have been issued and delivered prior to
the Delayed-Draw Termination Date, the Delayed-Draw Term Facility
Reduction Amount; provided that in each case:
(i) no Event of Default or event that upon the passage of time, the
giving of notice, or both, would become an Event of Default (Default)
under the Revolver Facility, the Delayed-Draw Term Facility or the
Term Facility then exists or would exist immediately after giving effect

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#4819-5662-6966
thereto, and the representations and warranties in the Loan Documents
shall be true and correct in all material respects on and as of the date of
the incurrence of such Incremental Facility (or, to the extent such
representation and warranties relate to an earlier date, they shall be true
and correct in all material respects as of such earlier date);
(ii) such Incremental Facilities may be provided by then existing
Lenders or, subject to the reasonable consent of the Administrative
Agent, other persons who become Lenders in connection therewith if
such consent would be required for an assignment to any such Lender
under the Loan Documentation (provided that no existing Lender will be
obligated to provide such Incremental Facilities without its consent);
(iii) solely with respect to an Incremental Revolver Facility, pro
forma compliance (assuming a full drawing of such Incremental
Revolver Facility) after giving effect to all appropriate pro forma
adjustments (but excluding all cash proceeds from such Incremental
Revolver Facility) with the Consolidated Superpriority Secured Net
Debt Leverage Test for the most recently ended quarterly test period for
which financial statements are available;
(iv) the maturity date of such Incremental Facilities shall be no
earlier than the maturity date of the Revolver Facility, the Delayed-Draw
Term Facility and the Term Facility, and such Incremental Facilities
shall require no scheduled amortization or mandatory commitment
reduction (other than pursuant to the same terms applicable to the
Revolver Facility or the Term Facility, as applicable) prior to the final
maturity of the Revolver Facility, the Delayed-Draw Term Facility and
the Term Facility and, with respect to the Incremental Revolver Facility,
shall be made pursuant to the same documentation, and (except as
otherwise set forth in clause (v) below) shall be on the exact same terms,
as are applicable to the Revolver Facility;
(v) the interest rates, interest margins, any rate floors, fees, original
issue and other funding discounts and premiums and (subject to clause
(iv) above) amortization schedule applicable to such Incremental
Facility shall be determined by the Borrower and the Lenders
thereunder; provided that the total yield on the Incremental Term
Facility or Incremental Revolver Facility (inclusive of interest rate floors
and any original issue discount or upfront fees, but excluding any
customary arrangement, administrative, advisory, origination or similar
fees in connection therewith that are not paid to all of the Lenders
providing the Incremental Facility) does not exceed the total yield on the
initial Term Facility or initial Revolver Facility, as applicable, by more
than 50 basis points, but the Borrower may increase the total yield on the
initial Term Facility or initial Revolver Facility, as applicable, on or
prior to the date of the incurrence of such Incremental Term Facility or
Incremental Revolver Facility, as applicable, in order to comply with
this proviso;
(vi) except as otherwise set forth above, such Incremental Term

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#4819-5662-6966
Facility shall be on terms and pursuant to documentation to be
determined between the Borrower and the Lenders thereunder; provided
that to the extent such terms and documentation are not consistent with
the Term Facility (except to the extent permitted by clauses (iv) and (v)
above), they shall be reasonably satisfactory to the Administrative
Agent; and
(vii) the Final Order Entry Date shall have occurred.
Documentation Principles: Documentation Principles means that (a) except as otherwise
expressly set forth herein in this Term Sheet or the Commitment Letter,
the terms and conditions of the mutually agreed definitive
documentation for each of the DIP Facilities (the Loan Documents)
shall be consistent with the terms and conditions, and in no event more
burdensome on the Debtors, than the terms and conditions of the
Prepetition TCEH Credit Facility; (b) the Loan Documents will be
prepared on the basis of, and using as precedent, the Prepetition TCEH
Credit Facility and its related collateral documents; and (c) generally all
terms and conditions (including exceptions, thresholds, baskets, grace
periods, cure periods and financial definitions) in the Loan Documents
will be consistent with those in the Prepetition TCEH Credit Facility and
its related collateral documents and in no event more burdensome on the
Debtors, in each case modified solely to the extent (i) required to reflect
the express terms and conditions set forth in this Term Sheet and the
Commitment Letter, (ii) required to reflect the shorter tenor of the DIP
Facilities, (iii) to account for the existence and continuance of the Cases,
the operational needs and requirements of the Debtors and the Specified
Affiliates (defined below) between the Petition Date and the Maturity
Date (including as set forth in the last two paragraphs of Negative
Covenants below) and to include provisions applicable to debtor-in-
possession facilities generally (including (subject to the last two
paragraphs of Negative Covenants below) customary changes to be
mutually agreed with respect to additional restrictions on indebtedness,
liens, restricted payments, asset sales and investments), and (iv) as
otherwise agreed by the Borrower.
Budget: As used in this Term Sheet and in Annex II hereto, Budget means the
following:
Beginning on the Interim Order Entry Date, in the case of the initial
Budget delivered as a condition to the closing and the funding of the
Initial Availability (the Initial Budget), a statement of cash
sources and uses of all free cash flow for the next full 3-calendar
months of the Debtors (on a consolidated basis) broken down by
month, including the anticipated uses of the DIP Facilities for such
period, and after such 3-calendar month period, at the end of each
fiscal quarter (or, at the election of the Borrower, at the end of each
calendar month or such other earlier period as may be agreed).
The Borrower shall also provide on a monthly basis a Budget
variance report/reconciliation for each calendar month (delivered no

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#4819-5662-6966
later than the end of the subsequent calendar month), (i) showing a
statement of actual cash sources and uses of all free cash flow for
the immediately preceding calendar month, noting therein all
material variances from values set forth for such historical periods in
the most recently delivered Budget, and shall include explanations
for all material variances, and (ii) certified as to its reasonableness
when made by the Borrower.
Annual Operating Forecast: Beginning on the date 60 days after the Interim Order Entry Date (and
again no later than December 1, 2014 for the business plan and
operating budget covering 2015 and no later than December 1, 2015 for
the business plan and operating budget covering 2016), the approved
annual business plan and projected operating budget through the stated
maturity date (the Annual Operating Forecast), broken down by
month, including, without limitation, income statements, balance sheets,
cash flow statements, projected capital expenditures, asset sales, a line
item for total available liquidity for the period of such Budget, and
which shall set forth the anticipated uses of the DIP Facilities for such
period; the associated underlying assumptions shall be certified by the
Borrower as being reasonable when made.
Both the Budget and the Annual Operating Forecast shall provide,
among other things, for the payment of the fees and expenses relating to
the DIP Facilities, ordinary course administrative expenses, bankruptcy-
related expenses and working capital, expected issuances and renewals
of letters of credit, and other general corporate needs; provided,
however, that notwithstanding anything to the contrary in this Term
Sheet or in any of the Loan Documents, the Professional Fees (defined
below) will be due and payable, and will be paid by the Debtors whether
or not consistent with the items or amounts set forth in the Budget or the
Annual Operating Forecast; and provided, further that under no
circumstance will the Budget or the Annual Operating Budget be
construed as a cap or limitation on the amount of the Professional Fees
due and payable by the Debtors.
Maturity: The maturity date of the DIP Facilities will be (and all Loans and other
payment obligations under the DIP Facilities shall be repaid in full in
cash on) the earliest of: (i) stated maturity, which shall be 24 months
from the Closing Date (defined below) subject to a six-month extension
if as of the first day of such extension (1) no Event of Default is
outstanding, (2) a Plan of Reorganization has been filed, (3) a hearing
has been scheduled for the confirmation of such Plan of Reorganization,
(4) the Debtors are working in good faith to confirm such Plan of
Reorganization, (5) an updated Budget and Annual Operating Forecast
have been delivered by the Borrower at least ten days prior to the first
day of such extension, which Budget and Annual Operating Forecast
demonstrate minimum liquidity sufficient to provide for Adequate
Protection Payments through such additional six-month period plus an
additional $250,000,000, and (6) the Borrower pays an extension fee in
the amount of 0.25% of the then outstanding Commitments and Loans
on the date of such payment to the Agent for distribution to the Lenders

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#4819-5662-6966
on a pro rata basis based on the respective Commitments and Loans held
by each Lender (subclauses (1) through (6), the Extension
Conditions); (ii) the effective date of any Plan of Reorganization; (iii)
the date that is 45 days after the Interim Order Entry Date if the Final
Order Entry Date shall not have occurred by such date; (iv) the date of
the consummation of a sale of all or substantially all of the Debtors
assets or stock under section 363 of the Bankruptcy Code; and (v) the
acceleration of the Loans and termination of the Commitments under
any of the DIP Facilities, including, without limitation, as a result of the
occurrence and continuance of an Event of Default (any such
occurrence, the Maturity Date); provided, however, that the Maturity
Date will occur in any event no later than 30 months from the Closing
Date.
Any plan of reorganization or liquidation or confirmation order entered
in the Cases shall not discharge or otherwise affect in any way any of the
joint and several obligations of the Debtors to the Lenders under the DIP
Facilities and the Loan Documents, other than after the payment in full
and in cash, to the Lenders of all obligations (other than indemnities and
other contingent obligations not then due and payable and collateralized
letters of credit) under the DIP Facilities and the Loan Documents on or
before the effective date of such plan and the termination of the
Commitments.
Closing Date: The date on which the specified portion of the Commitments is made
available for borrowings under the DIP Facilities (the Closing Date),
which shall be no later than five (5) business days after the Interim
Order Entry Date, subject to satisfaction (or waiver) of the applicable
conditions precedent set forth herein.
Amortization: None. For the avoidance of doubt, there will be neither an excess cash
flow sweep nor scheduled amortization under the DIP Facilities.
Interest Rate and Fees: As set forth on Annex III.
Borrowing Procedure: To be consistent with the Documentation Principles, including as
follows:
Borrowings under the Revolver Facility will be in minimum amounts of
$5,000,000 or multiples of $1,000,000 in excess thereof (or, if less, the
remaining available balance of the applicable Commitments), except for
deemed draw requests upon the Agents delivery of a Carve Out Trigger
Notice.
The Term Facility will be available in single draws on or after the date
the Interim Order or the Final Order is entered in respect of the portion
of the Term Facility available on each such date in accordance with
DIP Facilities Initial Availability and DIP Facilities Full
Availability above.
Borrowing requests under each DIP Facility shall be made (i) on three

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#4819-5662-6966
business days notice, in the case of Loans bearing interest at a rate
based on LIBOR (LIBOR Loans) and (ii) on one business days
notice, in the case of Loans bearing interest based on the Alternate Base
Rate (ABR Loans); provided that Loans funded and Letters of Credit
issued on the Interim Order Entry Date will be funded or issued on the
basis of a same day notice.
Currency: Borrowings will be made in U.S. Dollars. All payments under the DIP
Facilities will be made without setoff or counterclaim.
Voluntary Prepayments and
Commitment Reductions:
To be consistent with the Documentation Principles, including as
follows:
The Borrower may repay outstanding Term Loans and Delayed-Draw
Term Loans and/or reduce the Term Commitments and/or Delayed-
Draw Term Commitments at any time without premium or penalty,
including without any make-whole premium (other than breakage costs,
if applicable on the amount of the prepayment or reduction) upon (i) at
least three (3) business days notice in the case of LIBOR Loans and
(ii) one business days notice in the case of ABR Loans; provided that in
the case of repayment, each partial repayment shall be in an amount of
$5,000,000 or multiples of $1,000,000 in excess thereof (or, if less, the
outstanding amount of applicable Loans), and, each partial reduction
shall be in an amount of $5,000,000 or multiples of $1,000,000 in excess
thereof (or, if less, the remaining available balance of the relevant
Commitment).
The Borrower may repay the Revolver Loans under the Revolver
Facility and/or reduce the Revolver Commitments at any time without
premium or penalty (other than breakage costs, if applicable) upon (i) at
least three (3) business days notice in the case of LIBOR Loans and
(ii) one business days notice in the case of ABR Loans; provided that in
the case of repayment, each partial repayment shall be in an amount of
$1,000,000 or multiples of $500,000 in excess thereof (or, if less, the
outstanding amount of applicable Loans), and, in the case of reduction
of the Revolver Commitments, each partial reduction shall be in an
amount of $1,000,000 or multiples of $500,000 in excess thereof (or, if
less, the remaining available balance of the Revolver Commitments).
Mandatory Prepayments: The following mandatory prepayments shall be required, subject, in each
case, to reinvestment rights, exceptions and mechanics consistent with
the Documentation Principles:
1. Asset Sales: Prepayments of the DIP Facilities in an amount equal to
100% of the net cash proceeds of the sale or other disposition of any
property or assets (other than any such proceeds received prior to the
date of commencement of the Cases) of the Debtors, other than net
cash proceeds of sales or other dispositions of power, capacity,
energy, ancillary services and other products, inventory and services
or contracts related to any of the foregoing (in each case, whether in
physical, financial or other form), any dispositions between the

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#4819-5662-6966
Debtors, any dispositions consisting of leases and sub-leases and
any other sales or dispositions in the ordinary course of business or
consistent with past practice, and subject, in each case, to any
Applicable Limitations and additional exceptions to be mutually
agreed on in the Loan Documents consistent with the
Documentation Principles.
2. Insurance Proceeds: Prepayments of the DIP Facilities in an amount
equal to 100% of the net cash proceeds of insurance paid on account
of any loss of any property or assets of the Debtors (other than any
such proceeds received prior to the date of commencement of the
Cases), subject to any Applicable Limitations and with restrictions
to be mutually agreed, and subject to exceptions to be mutually
agreed on in the Loan Documents consistent with the
3. RCT Letter of Credit Exposure. On any date that the outstanding
RCT Letter of Credit exposures exceed the balance on the RCT L/C
Cash Collateral Account (an Excess RCT L/C Exposure), not
later than within two (2) business days from written notice by the
applicable RCT Letter of Credit Issuer of the existence of such
Excess RCT L/C Exposure, the Borrower will either (i) deposit
additional cash in the RCT L/C Cash Collateral Account or
otherwise cash collateralize (at 100%) an amount at least equal to
such Excess RCT L/C Exposure, or (ii) cause the reduction of any
outstanding RCT Letters of Credit exposure in an amount at least
equal to such Excess RCT L/C Exposure.
4. General Letter of Credit Exposure. On any date that the outstanding
General Letter of Credit exposures exceed the balance on the
General L/C Cash Collateral Account (an Excess General L/C
Exposure), not later than within two (2) business days from written
notice by the applicable General Letter of Credit Issuer of the
existence of such Excess General L/C Exposure, the Borrower will
either (i) deposit additional cash in the General L/C Cash Collateral
Account or otherwise cash collateralize (at 100%) an amount at least
equal to such Excess General L/C Exposure, or (ii) cause the
reduction of any outstanding General Letters of Credit exposure in
an amount at least equal to such Excess General L/C Exposure.
Notwithstanding the foregoing, no mandatory prepayments pursuant
to clauses 1 and 2 above shall be due in respect of net cash proceeds
that (x) do not exceed $25,000,000 in respect of a single mandatory
prepayment event and (y) do not exceed $100,000,000 in respect of
the aggregate amount of net cash proceeds of all mandatory
prepayment events
Application of Mandatory
Prepayments:
Any mandatory prepayments (other than as set forth in paragraph 3 of
Mandatory Prepayments above) shall be applied first to the Term
Facility and the Delayed-Draw Term Facility until paid in full, and then
to the Revolver Facility (without any permanent reduction in

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#4819-5662-6966
commitments thereof).
RCT Reclamation Support
Carve Out:
Unless and until the Borrower issues the RCT Carve Out Support
Rejection Notice, all amounts up to $1,100,000,000 required to be paid
to the RCT pursuant to amounts due and owing in respect of reclamation
obligations incurred by the RCT will constitute the RCT Reclamation
Support Carve Out, and such RCT Reclamation Support Carve Out will
be senior to the Obligations and to any other obligations or liabilities of
the Debtors (other than, and subject in any event to, the Carve Out).
If the RCT denies or rejects the TCEH Debtors application to utilize the
RCT Reclamation Support Carve Out to satisfy RCTs bonding
requirements, then the Borrower shall be obligated to promptly
terminate and permanently reduce to $0 the RCT Reclamation Support
Carve Out by issuing and delivering a notice in writing to the
Administrative Agent, and the RCT shall thereafter cease to have any
rights in respect of the RCT Reclamation Support Carve Out (the RCT
Carve Out Support Rejection Notice).
Priority/Security: All obligations of the Debtors to the Administrative Agent, the Lenders,
and the Letter of Credit Issuers (such persons, collectively, the DIP
Secured Parties) under the Loan Documents (the Obligations)
including all Loans made under the DIP Facilities, shall, subject to the
Carve Out (defined below) and the RCT Reclamation Support Carve
Out, at all times:
(i) pursuant to Bankruptcy Code section 364(c)(1), be entitled to joint
and several superpriority administrative expense claim status in the
Cases, on a pari passu basis;
(ii) pursuant to Bankruptcy Code section 364(c)(2), be secured by the
following:
a perfected first-priority lien on substantially all now owned or
hereafter acquired assets and property of the Debtors, including
real and personal property, plant and equipment, the RCT L/C
Cash Collateral Account, the General L/C Cash Collateral
Account, cash and the proceeds of each of the foregoing the
(Collateral); provided, however, that notwithstanding
anything to the contrary herein or in any other Loan Document,
(x) Excluded Stock and Stock Equivalents, Excluded
Subsidiaries and any Excluded Property (each as defined in
the Prepetition TCEH Credit Facility and the Credit
Documents (as defined therein)) will be excluded from the
Collateral, and (y) in any event all Guarantors pursuant to the
Prepetition TCEH Credit Agreement immediately prior to the
Petition Date will be Guarantors and their assets will constitute
Collateral to the same extent constituting Collateral
pursuant to the Prepetition TCEH Credit Agreement
immediately prior to the Petition Date; provided, further, that
the Collateral shall exclude the Debtors claims and causes of

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#4819-5662-6966
action under Chapter 5 of the Bankruptcy Code, or any other
avoidance actions under the Bankruptcy Code (collectively,
Avoidance Actions), but subject only to, and effective upon,
entry of the Final Order, shall include any proceeds or property
recovered, unencumbered or otherwise the subject of successful
Avoidance Actions, whether by judgment, settlement or
otherwise; provided, further, that notwithstanding the
Documentation Principles, the Collateral shall include (i) stock
and stock equivalents of Immaterial Subsidiaries (as defined
in the Prepetition TCEH Credit Facility) that are Debtors, (ii)
deposit accounts and cash, and (iii) any other assets that were
excluded from Collateral in the Prepetition Credit Facility due to
practicality or the necessity of obtaining third party consents or
taking other additional steps, but only to the extent that a lien in
such Collateral may be perfected by the entry of the Interim
Order and the Final Order. In addition, Excluded Subsidiary
will include with respect to any actual or purported Obligation
(including pursuant to any guarantee or grant of security) with
respect to any swap (as defined under the Commodity
Exchange Act) (after giving effect to keepwell agreements in the
Loan Documents) entered into by the Parent Guarantor, the
Borrower or Subsidiary Guarantor thereof that is not an eligible
contract participant (as such term is defined in the Commodity
Exchange Act) at the time such swap Obligation is incurred,
or in the case of an Obligation resulting from a guarantee (or
grant of security) at the later of the time such guarantee (or grant
of security) is entered into and the time such swap obligation
being guaranteed (or secured) is incurred. For the avoidance of
doubt, Collateral will also exclude the following: (a) those
assets over which the granting of security interests in such assets
would be prohibited by contract (other than any in respect of
any of the Prepetition Secured Facilities), applicable law or
regulation or the organizational documents of any non-wholly
owned subsidiary (including permitted liens, leases and
licenses), or to the extent that such security interests would
result in adverse tax or accounting consequences as determined
in good faith by the Borrower, (b) those assets as to which the
Administrative Agent and the Borrower reasonably determine
that the cost of obtaining such a security interest or perfection
thereof are excessive in relation to the benefit to the Lenders of
the security to be afforded thereby, (c) assets in respect of which
the granting or perfection of a lien would violate any applicable
law or regulation (including regulations adopted by FERC, the
Public Utility Commission of Texas and/or the Nuclear
Regulatory Commission), and (d) subject to the requirement that
all Guarantors pursuant to the Prepetition TCEH Credit
Agreement immediately prior to the Petition Date will be
Guarantors and their assets will constitute Collateral to the
same extent constituting Collateral pursuant to the Prepetition
TCEH Credit Agreement immediately prior to the Petition Date,
other exceptions (i) to be mutually agreed upon or (ii) that are

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#4819-5662-6966
usual and customary for facilities of this type for affiliates of the
Borrower will not constitute Collateral); provided, however,
notwithstanding anything to the contrary contained herein, to the
extent the security interest in such Collateral may be perfected
by the entry of the Interim Order and the Final Order, neither the
Borrower nor any Guarantor shall be required to obtain, provide
or execute any mortgage or control agreement in favor of the
Agent or any other DIP Secured Party with regard to any
Collateral nor shall the Borrower or any Guarantor be required
to obtain a certificate of title evidencing the security interest of
the Agent or any other Secured Party with respect to any
Collateral;
1

in each case, to the extent that such Collateral is not subject to valid,
perfected and non-avoidable liens as of the commencement of the Cases;
(iii) pursuant to Bankruptcy Code section 364(c)(3), be secured by the
following:
a perfected lien on all Collateral;
to the extent that such Collateral is subject to valid, perfected and non-
avoidable liens in favor of third parties in existence at the time of the
commencement of the Cases or to valid liens in existence at the time of
such commencement that are perfected subsequent to such
commencement as permitted by Section 546(b) of the Bankruptcy Code
(other than property that is subject to the existing liens that secure the
obligations under any of the Prepetition Secured Facilities referred to
above (excluding the Deposit L/C Loan Collateral Account to the
extent of the Deposit L/C Obligations (each as defined in the
Prepetition TCEH Credit Facility) (the Prepetition Deposit L/C
Collateral)), which liens shall be primed by the liens securing the DIP
Facilities, the Carve Out and the liens securing the Eligible Pari Passu
Hedges described in such clause); and
(iv) pursuant to Bankruptcy Code section 364(d), be secured by the
following:
a perfected priming first-priority lien on all Collateral;
avoidable liens in favor of third parties as of the commencement of the
Cases, including, all accounts receivable, inventory, real and personal
property, plant and equipment of the Debtors that secure the obligations
of the Debtors under or in connection with the Prepetition Secured
Facilities (including, for the avoidance of doubt, with respect to EFCH

1
To the extent Excluded Assets is to be limited at the request of the Joint Lead Arrangers in the manner set
forth above, the Debtors and the Joint Lead Arrangers agree that the exclusions initially proposed by the
Debtors on September 15, 2013 will be reinstated in full in the definition of Excluded Assets for purposes of
any exit facility collateral.

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as parent guarantor under the Prepetition TCEH Credit Facility, but
excluding the Prepetition Deposit L/C Collateral (which shall be subject
to the lien set forth in clause (iii) above);
subject, in each case, to the Carve Out and the RCT Reclamation
Support Carve Out.
All liens securing the Obligations, the Adequate Protection Liens
(defined below), the 507(b) Claim (as defined below), the Eligible Pari
Passu Hedges, and any and all other forms of adequate protection, liens
or claims securing the Obligations and all other prepetition obligations
of the Debtors, including the liens and security interests granted to the
respective lenders, counterparties and holders pursuant to and in
connection with the Prepetition Secured Facilities (the Existing
Primed Creditors) (including all security agreements, pledge
agreements, mortgages, deeds of trust and other security documents
executed by any of the Debtors in favor of the agents under the
Prepetition Secured Facilities, for its benefit and for the benefit of the
any secured party under or in connection with the Prepetition Secured
Facilities), shall be subject and subordinate to the Carve Out and the
RCT Reclamation Support Carve Out; provided, however, that cash or
other amounts of cash equivalents on deposit to cash collateralize Letters
of Credit shall not be subject to the Carve Out or the RCT Reclamation
Support Carve Out.
The Carve Out means the sum of (i) all fees required to be paid to the
Clerk of the Bankruptcy Court and to the Office of the United States
Trustee under section 1930(a) of title 28 of the United States Code plus
interest at the statutory rate (without regard to the notice set forth in
(iii) below); (ii) fees and expenses up to $50,000 incurred by a trustee
under section 726(b) of the Bankruptcy Code (without regard to the
notice set forth in (iii) below); (iii) to the extent allowed at any time,
whether by interim order, procedural order or otherwise, all unpaid fees
and expenses (the Professional Fees) incurred by persons or firms
(Debtor Professionals) retained by the Debtors pursuant to section
327, 328 or 363 of the Bankruptcy Code and any official committee of
unsecured creditors (the Committee and, together with the Debtor
Professionals, the Professional Persons) appointed in the Cases
pursuant to section 1103 of the Bankruptcy Code at any time before or
on the first Business Day following delivery by the Agent of a Carve
Out Trigger Notice (defined below), whether allowed by the Bankruptcy
Court prior to or after delivery of a Carve Out Trigger Notice; and
(iv) Professional Fees of Professional Persons in an aggregate amount
not to exceed $50,000,000 incurred after the first Business Day
following delivery by the Agent of the Carve Out Trigger Notice, to the
extent allowed at any time, whether by interim order, procedural order
or otherwise (the amounts set forth in this clause (iv) being the Post-
Carve Out Trigger Notice Cap). For purposes of the foregoing,
Carve Out Trigger Notice shall mean a written notice delivered by
email (or other electronic means) by the Agent to the Debtors, their lead
restructuring counsel, the United States Trustee, and lead counsel to the

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#4819-5662-6966
Committee, which notice may be delivered following the occurrence and
during the continuation of an Event of Default and acceleration of the
Obligations under the DIP Facilities, stating that the Post-Carve Out
Trigger Notice Cap has been invoked.
On the day on which a Carve Out Trigger Notice is given by the Agent
to the Debtors, the Carve Out Trigger Notice shall (i) be deemed a
request by the Debtors for Loans under the Revolver Commitment (on a
pro rata basis based on the then outstanding Revolver Commitments), in
an amount equal to the then unpaid amounts of the Professional Fees
(any such amounts actually advanced shall constitute Revolver Loans),
and (ii) also constitute a demand to the Debtors to utilize all cash on
hand as of such date and any available cash thereafter held by any
Debtor to fund a reserve in an amount equal to the then unpaid amounts
of the Professional Fees. The Debtors shall deposit and hold such
amounts in a segregated account at Revolver Facility Administrative
Agent in trust to pay such then unpaid Professional Fees (the Pre-
Carve Out Trigger Notice Reserve) prior to any and all other claims.
On the same day on which a Carve Out Trigger Notice is given, the
Carve Out Trigger Notice shall also be deemed a draw request and
notice of borrowing by the Debtors for Loans under the Revolver
Commitment (on a pro rata basis based on the then outstanding Revolver
Commitments), in an amount equal to the Post-Carve Out Trigger
Notice Cap (any such amounts actually advanced shall constitute
Revolver Loans). The Debtors shall deposit and hold such amounts in a
segregated account at Administrative Agent in trust to pay such
Professional Fees benefiting from the Post-Carve Out Trigger Notice
Cap (the Post-Carve Out Trigger Notice Reserve and, together with
the Pre-Carve Out Trigger Notice Reserve, the Carve Out Reserves)
prior to any and all other claims. On the first Business Day after the
Agent gives such notice to such Revolver Lenders, notwithstanding the
existence of a Default or Event of Default, the failure of the Debtors to
satisfy any or all of the conditions precedent for Revolver Loans under
the Revolver Facility or the occurrence of the Maturity Date, each
Revolver Lender with an outstanding Commitment (on a pro rata basis
based on the then outstanding Commitments) shall make available to the
Agent such Revolver Lenders pro rata share with respect to such
Borrowing in accordance with the Revolver Facility. All funds in the
Pre-Carve Out Trigger Notice Reserve shall be used first to pay the
obligations set forth in clauses (ii) through (iii) of the definition of Carve
Out set forth above, but not, for the avoidance of doubt, the Post-Carve
Out Trigger Notice Cap, until paid in full, and then, to the extent the
Pre-Carve Out Trigger Notice Reserve has not been reduced to zero, to
pay the Agent for the benefit of the Lenders, unless the Obligations have
been paid in full, in which case any such excess shall be paid to the
lenders under the Prepetition Secured Facilities in accordance with their
rights and priorities as of the Petition Date. All funds in the Post-Carve
Out Trigger Notice Reserve shall be used first to pay the obligations set
forth in clause (iv) of the definition of Carve Out set forth above, and
then, to the extent the Post-Carve Out Trigger Notice Reserve has not
been reduced to zero, to pay the Agent for the benefit of the Lenders,

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#4819-5662-6966
unless the Obligations have been paid in full, in which case any such
excess shall be paid to the lenders under the Prepetition Secured
Facilities in accordance with their rights and priorities as of the Petition
Date.
Notwithstanding anything to the contrary in the Loan Documents, the
Interim Order or the Final Order, following delivery of a Carve Out
Trigger Notice, the Agents and the Prepetition First Lien Agents shall
not sweep or foreclose on cash (including cash received as a result of the
sale or other disposition of any assets) of the Debtors until the Carve Out
Reserves have been fully funded, but shall have a security interest in any
residual interest in the Carve Out Reserves, with any excess paid to the
Agents for application in accordance with the Loan Documents.
Further, notwithstanding anything to the contrary herein,
(i) disbursements by the Debtors from the Carve Out Reserves shall not
constitute Loans or increase or reduce the Obligations, (ii) the failure of
the Carve Out Reserves to satisfy in full the Professional Fees shall not
affect the priority of the Carve Out and (iii) in no way shall the Carve
Out, Post-Carve Out Trigger Notice Cap, Carve Out Reserves, any
Budget, the Initial Budget, any Annual Operating Forecast or any of the
foregoing be construed as a cap or limitation on the amount of the
Professional Fees due and payable by the Debtors. The Debtors shall
not assert or prosecute, and no portion of the proceeds of the DIP
Facilities, the Collateral, or the Carve Out, and no disbursements set
forth in the Budget, shall be used for the payment of professional fees,
disbursements, costs or expenses incurred by any person in connection
with (a) preventing, hindering or delaying any of the Prepetition First
Lien Agents, the Prepetition First Lien Creditors, the Agents or the
Lenders enforcement or realization upon any of the Collateral once an
Event of Default has occurred and after the Remedies Notice Period,
(b) objecting or challenging or contesting in any manner, or raising any
defenses to, the validity, extent, amount, perfection, priority, or
enforceability of any of the Obligations, the DIP liens, the obligations
and liens under the Prepetition Secured Facilities, or any other rights or
interest of any of the Agent, the Lenders, the Prepetition First Lien
Agent or any Prepetition First Lien Creditor, or (c) asserting,
commencing or prosecuting any claims or causes of action, including,
without limitation, any actions under Chapter 5 of the Bankruptcy Code,
against the Agent, any Lender, the Prepetition First Lien Agent, any
Prepetition First Lien Creditor or any of their respective affiliates,
agents, attorneys, advisors, professionals, officers, directors and
employees; provided, however, that the foregoing shall not restrict the
Debtors from using proceeds of the DIP Facilities to seek to use cash
collateral on a non-consensual basis or prosecuting a plan of
reorganization over the objection of the Prepetition First Lien Creditors;
provided, further, that the Carve Out and such collateral proceeds and
loans under the Loan Documents may be used for allowed fees and
expenses, in an amount not to exceed $250,000 in the aggregate,
incurred solely by the Committee, if appointed, in investigating (but not
commencing or prosecuting) the validity, enforceability, perfection,

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#4819-5662-6966
priority or extent of the liens under the Prepetition Secured Facilities.
Any party granted standing by the Bankruptcy Court other than the
Committee must commence any claims against the Prepetition First Lien
Agents no later than seventy-five (75) calendar days following entry of
the Interim Order, and, with respect to the Committee, if appointed and
granted standing by the Bankruptcy Court, no later than sixty (60)
calendar days after its formation.
The liens on the Collateral securing the Prepetition Secured Facilities
shall be junior and subordinate to the Carve Out, the RCT Reclamation
Support Carve Out, the liens securing the Obligations, the Adequate
Protection Liens, and the liens securing the Eligible Pari Passu Hedges.
All of the liens described herein shall be effective and perfected as of the
Interim Order Entry Date and without the necessity of the execution of
mortgages, security agreements, pledge agreements, financing
statements or other agreements.
Adequate Protection: Pursuant to sections 361, 363(e) and 364(d)(1) of the Bankruptcy Code,
the Prepetition First Lien Agent, for the benefit of itself and the holders
of claims on account of Prepetition First Lien Debt (the Prepetition
First Lien Creditors) and the Prepetition Second Lien Agent, for the
benefit of itself and the holder of claims on account of Prepetition
Second Lien Debt (the Prepetition Second Lien Creditors), in each
case, shall be granted the following adequate protection (collectively,
the Adequate Protection) of the security interests of the Prepetition
First Lien Creditors in the Collateral securing the Prepetition First Lien
Debt (including, without limitation, cash collateral) (the Prepetition
First Lien Collateral) and of the security interests of the Prepetition
Second Lien Creditors in the Collateral securing the Prepetition Second
Lien Debt (including, without limitation, cash collateral) (the
Prepetition Second Lien Collateral), and equal in amount to, any
diminution in the value (collectively, the Diminution in Value) of
such prepetition security interests of such Prepetition First Lien
Creditors and Prepetition Second Lien Creditors, respectively, calculated
in accordance with section 506(a) of the Bankruptcy Code, whether or
not the Diminution in Value results from the sale, lease or use by the
Debtors of the Prepetition First Lien Collateral or Prepetition Second
Lien Collateral, as applicable, the priming of the prepetition security
interests of such Prepetition First Lien Creditors or Prepetition Second
Lien Creditors, as applicable, or the stay of enforcement of any
prepetition security interests arising from section 362 of the Bankruptcy
Code, or otherwise:
(a) Adequate Protection Liens. As security for and solely to the
extent of any Diminution in Value of their prepetition security
interests, the Prepetition First Lien Agent shall be granted for its
benefit and the benefit of the applicable Prepetition First Lien
Creditors and the Prepetition Second Lien Agent shall be
granted for its benefit and the benefit of the applicable
Prepetition Second Lien Creditors, respectively, effective and
perfected as of the Interim Order Entry Date and without the

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#4819-5662-6966
necessity of the execution of mortgages, security agreements,
pledge agreements, financing statements or other agreements, a
replacement security interest in and lien on the Collateral
(together, the Adequate Protection Liens), subject and
subordinate only to (i) the Carve Out, (ii) the RCT Reclamation
Support Carve Out, (iii) the liens securing the DIP Facilities,
(iv) the liens securing the Eligible Pari Passu Hedges, which
Adequate Protection Liens shall, inter se, rank in the same
relative priority and right as do the respective security interests
and liens of the respective Prepetition First Lien Creditors and
Prepetition Second Lien Creditors, as applicable, as of the
Petition Date.
(b) Super-Priority Claim. To the extent of any Diminution in Value
of the Prepetition First Lien Creditors or the Prepetition Second
Lien Creditors, in their respective prepetition security interests,
the Prepetition First Lien Agent, on behalf of itself and the
applicable Prepetition First Lien Creditors and the Prepetition
Second Lien Agent, on behalf of itself and the applicable
Prepetition Second Lien Creditors, respectively, shall be
granted, subject to the payment of the Carve Out, a superpriority
administrative expense claim pursuant to section 507(b) of the
Bankruptcy Code, immediately junior to the claims under
section 364(c)(1) of the Bankruptcy Code held by the Agent and
the Lenders and other secured parties under the DIP Facilities
(the 507(b) Claim), which 507(b) Claim shall, inter se, rank
in the same relative priority and right as do the respective claims
of the Prepetition First Lien Creditors and Prepetition Second
Lien Creditors, as applicable, as of the Petition Date; provided
that the Prepetition First Lien Agent and Prepetition First Lien
Creditors and the Prepetition Second Lien Agent and Prepetition
Second Lien Creditors shall not receive or retain any payments,
property or other amounts on account of the 507(b) Claim or on
account of the Prepetition First Lien Debt or Prepetition Second
Lien Debt, as applicable, unless and until the Obligations (other
than indemnities and/or contingent obligations not then due and
payable) and the Eligible Pari Passu Hedges have indefeasibly
been paid in cash in full.
(c) Fees and Expenses. The Prepetition First Lien Agent shall
receive (for the benefit of the lenders under the Prepetition
Secured Facilities) from the Debtors current cash payments of
all reasonable and documented out-of-pocket fees and expenses
of professionals payable pursuant to the engagement letters
dated as of February 1, 2013, with Millstein & Co., L.P.,
financial advisors to certain of the Prepetition First Lien
Creditors, and Paul, Weiss, Rifkind, Wharton & Garrison LLP,
as lead counsel to certain of the Prepetition First Lien Creditors,
plus the reasonable and documented professional fees and
expenses of Young Conaway Stargatt & Taylor, LLP, as local
counsel to certain of the Prepetition First Lien Creditors,

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#4819-5662-6966
promptly upon receipt of invoices therefor, after providing the
U.S. Trustee and counsel to any statutory committee with copies
of the invoices and a ten day period to object.
As additional adequate protection, the Prepetition First Lien Agent, on
behalf of itself and the other Prepetition First Lien Creditors thereunder,
may be granted the following:
Adequate Protection Payments. The Prepetition First Lien Agent
on behalf of the Prepetition First Lien Creditors may receive
from the Debtors periodic adequate protection payments (the
Adequate Protection Payments) in an amount resulting from
applying (including, if any, settlement or termination amounts
owed under the First Lien Commodity Hedges and any letter of
credit fees, in each case in accordance with respective terms of
the relevant Prepetition First Lien Debt) a per annum rate equal
to LIBOR + 450 basis points to the aggregate outstanding
amount of Prepetition First Lien Obligations as of the Petition
Date in respect of such relevant periods ending after the Petition
Date (and not, for the avoidance of doubt, at any different rate
set forth in any of the Prepetition First Lien Debt); provided,
however, that any Adequate Protection Payment shall be
without prejudice, and with a full reservation of rights, as to
whether such payment should be recharacterized or reallocated
pursuant to section 506(b) of the Bankruptcy Code as principal
payments under the Prepetition First Lien Debt (whether as to
principal, interest or otherwise). The Adequate Protection
Payments and the expenses paid by the Debtors pursuant to
clause (c) of Adequate Protection do not themselves result in
Diminution in Value. The Adequate Protection Payments will be
calculated on a monthly basis, and be due and payable on the
first business day of each month occurring after the first full
month following the Petition Date.
The Prepetition First Lien Agent on behalf of Prepetition First Lien
Creditors shall also receive (i) the Budget, (ii) the Annual Operating
Forecast and (iii) to the extent given to the Lenders, reasonable access to
the Debtors records and information.
Representations and
Warranties:
Each of the Debtors under the DIP Facilities will make only the
following representations and warranties, consistent with the
Documentation Principles and (for the avoidance of doubt) each as
modified as necessary to reflect the commencement of the Cases and
events leading up to and following commencement.
Financial statements; no Material Adverse Event since the Petition Date;
existence and good standing, authorization and validity; compliance
with law; corporate power and authority; due authorization, execution,
deliver and enforceability of Loan Documents; no conflict with law,
organizational documents, unstayed orders and decrees or post-petition
material contractual obligations; no material unstayed litigation; no

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default; ownership of property; intellectual property; taxes; insurance;
Federal Reserve regulations; ERISA; Investment Company Act;
subsidiaries; environmental matters; labor matters; OFAC; FCPA; anti-
terrorism laws and anti-money laundering laws; effectiveness of the
Interim Order and the Final Order; creation, validity, perfection and
priority of lien securing the DIP Facilities; and accuracy of disclosure.
Notwithstanding anything in the Commitment Letter, the Fee Letter, this
Term Sheet or any Loan Document to the contrary, the Debtors will not
provide any representation or warranty concerning solvency.
As used herein and in the Loan Documents, a Material Adverse
Event shall mean any circumstance or conditions affecting the
business, assets, operations, properties or financial condition of the
Borrower and its subsidiaries taken as a whole, that would individually
or in the aggregate, materially adversely affect the ability of the Debtors
(taken as a whole) to perform their payment obligations under the Loan
Documents to which they are a party, or the rights and remedies of the
Agent, the Letter of Credit Issuers and the Lenders under the Loan
Documents (other than, in each case, as a result of the events leading up
to, and following commencement of a proceeding under Chapter 11 of
the Bankruptcy Code and the continuation and prosecution thereof,
including circumstances or conditions resulting from, or incidental to,
such events, commencement, continuation and prosecution, which shall
not, individually or in the aggregate, constitute a Material Adverse
Event), and provided, further, that nothing disclosed in any of the
following filings by EFH and/or EFCH (1) the Annual Report on Form
10-K for the year ended December 31, 2013 as filed on the date of the
Commitment Letter (to the extent substantially the same in form and
substance as the version provided to the Joint Lead Arrangers at least 2
days prior to the date of the Commitment Letter), (2) any filings on
Form 8-K made through the date of the Commitment Letter and/or (3)
any disclosure statement related to any plan of reorganization or
liquidation of Debtors provided to the Joint Lead Arrangers on or prior
to the date of the Commitment Letter, shall, in any case, in and of itself
and based solely on facts as disclosed therein (without giving effect to
any developments not disclosed therein) constitute a Material Adverse
Event.
Covenants:
- Financial Covenant: Each of the Debtors under the DIP Facilities will agree only to the
following financial covenant (subject to the Documentation Principles):
Solely with respect to the Revolver Facility, on the last day of
any fiscal quarter (but in no event earlier than June 30, 2014)
(each, a Test Date), a Consolidated Superpriority Secured
Net Debt leverage test pursuant to which on each such Test Date
the ratio of (i) the outstanding principal amount of Term Loans,
plus the outstanding principal amount of Delayed-Draw Term
Loans, plus the aggregate amount of undrawn Revolver
Commitments, the aggregate principal amount of Revolver

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#4819-5662-6966
Loans then outstanding to (ii) Consolidated EBITDA may not
exceed (x) if the RCT Carve Out Support Rejection Notice has
not been issued or delivered on or prior to the applicable Test
Date, 3.50 to 1.00 and (y) on all other Test Dates, 4.50 to 1.00
(the Consolidated Superpriority Secured Net Debt Leverage
Test);
The Consolidated Superpriority Secured Net Debt and the
Consolidated EBITDA will be defined in a manner consistent
with the Documentation Principles (including as to netting of
unrestricted cash but without giving effect to any cap thereon;
provided, however, that cash in the RCT L/C Cash Collateral
Account and the General L/C Cash Collateral Account will not
be netted).
Consolidated EBITDA will include, in addition to such add-
backs as are consistent with the Documentation Principles, add-
backs on account of (with each underlying definition to be
defined in a manner consistent with the Documentation
Principles) (i) restructuring-related or other similar charges, fees,
costs, charges, commissions and expenses or other charges
incurred during such period in connection with the DIP
Facilities, the Cases, any reorganization plan in connection with
the Cases, any exit credit agreements or financings, and any
and all transactions contemplated by the foregoing, including the
write-off of any receivables, the termination or settlement of
executory contracts, professional and accounting costs fees and
expenses, management incentive, employee retention or similar
plans (in each case to the extent such plan is approved by the
Bankruptcy Court to the extent required), litigation costs and
settlements, asset write-downs, income and gains recorded in
connection with the corporate reorganization of the Debtors and
their subsidiaries; and (ii) the amount of any losses, costs, fees
and expenses on disposition of receivables and related assets in
connection with any Permitted Receivables Financing, and any
losses, costs, fees and expenses in connection with the early
repayment, accelerated amortization, repayment, termination or
other payoff (including as a result of the exercise of remedies) of
any Permitted Receivables Financing.

Notwithstanding the foregoing, the Consolidated EBITDA in
respect of the following periods shall be as follows:
Period Consolidated EBITDA
Fiscal Quarter ending 9/30/13 $500,000,000

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#4819-5662-6966
Fiscal Month ending 4/30/14 $10,000,000
- Affirmative
Covenants:
Each of the Debtors under each of the DIP Facilities (solely with respect
to itself and each of the other Debtors and restricted subsidiaries) will
agree only to the following affirmative covenants (consistent with, in
each case, the Documentation Principles):
(a) delivery of (i) periodic updates of the Budget and monthly
variance reports and (ii) quarterly and annual financial
statements;
(b) delivery of monthly reports with respect to asset sales, cost
savings, and other matters reasonably requested by the Agent;
(c) delivery to the Agent and its legal counsel, at least 2 business
days in advance of filing with the Bankruptcy Court, of all
proposed first day pleadings and proposed orders, which must
be in form and substance reasonably satisfactory to the Agent
(but in the case of the order governing cash management and the
order governing adequate protection, shall be satisfactory in
form and substance to the Agent);
(d) delivery to the Agent and its legal counsel, as soon as
practicable in advance of filing with the Bankruptcy Court, of
any plan or reorganization or liquidation and/or any disclosure
statement related to such plan, which must be in form and
substance reasonably satisfactory to the Agent; provided,
however, that with respect to provisions of the plan of
reorganization and/or any disclosure statement that relate to
payment of the DIP Facilities, such provisions must be in form
and substance satisfactory to the Agent;
(e) delivery to the Agent as soon as practicable in advance of filing
with the Bankruptcy Court of the Final Order (which must be in
form and substance satisfactory to the Agent), all other proposed
material orders and pleadings related to the DIP Facilities
(which must be in form and substance reasonably satisfactory to
the Agent);
(f) file with the Bankruptcy Court a plan of reorganization and a
disclosure statement relating thereto, each in form and substance
reasonably satisfactory to the Agent, within 18 months after the
Petition Date; provided, however, that with respect to provisions
of the plan of reorganization and/or any disclosure statement
that relate to payment of the DIP Facilities, such provisions
must be in form and substance satisfactory to the Agent;
(g) maintenance of cash management system in accordance with the
orders entered in the Cases, which orders shall be in form and
substance satisfactory to the Agent;

26
#4819-5662-6966
(h) contest, if requested by the Agent, any motion seeking entry of
an order, and entry of an order, that is materially adverse to the
interests of the Agent or the Lenders or their respective material
rights and remedies under the DIP Facilities in any of the Cases;
(i) additional reporting reasonably requested by the Agent,
including, without limitation, with respect to litigation,
contingent liabilities, Defaults, ERISA, environmental liabilities
and Material Adverse Events;
(j) reasonable access to information (including historical
information) and personnel (during normal business hours),
including, regularly scheduled meetings as mutually agreed with
senior management of the Borrower and other company advisors
(during normal business hours), and a subset of the Agent and
Millstein & Co., L.P. (Lenders Financial Advisor), and
Lenders Financial Advisor shall be provided with access to all
information it shall reasonably request and to other internal
meetings regarding strategic planning, cash and liquidity
management, operational and restructuring activities;
(k) if not already obtained, commercially reasonable efforts to
obtain ratings from each of Moodys and Standard & Poors as
soon as reasonably practicable following the Closing Date; and
(l) only such additional affirmative covenants (as modified to
account for the commencement and continuance of the Cases
and other express provisions in this Term Sheet and the
Commitment Letter) as are consistent with the Documentation
Principles.
- Negative Covenants: Each of the Debtors under each of the DIP Facilities (solely with respect
agree only to the following negative covenants, consistent with, in each
case, the Documentation Principles:
(a) prohibition on creating or permitting to exist any liens on any
assets, other than liens securing the DIP Facilities and any
permitted liens consistent with the Documentation Principles
(which liens shall include, among others, scheduled liens in
existence on the Closing Date) and other liens described in
Priority/Security above;
(b) prohibition on creating or permitting to exist any other
superpriority administrative expense claim or claim that is
pari passu with or senior to the claims of the Lenders under the
DIP Facilities (in each case, other than the Carve-Out, the RCT
Reclamation Support Carve-Out or the Obligations);
(c) prohibition on making adequate protection payments to, or
otherwise providing adequate protection for, the Prepetition

27
#4819-5662-6966
First Lien Creditors or the Second Lien Creditors other than as
provided for in this Term Sheet and contained in the Interim
Order, the Final Order and/or any cash collateral order;
(d) prohibition on the use of proceeds of the DIP Facilities or the
Letters of Credit for purposes other than those described in this
Term Sheet and contained in the Interim Order and Final Order;
(e) limitations on disposing of assets (including, without limitation,
any sale and leaseback transaction and any disposition under
Bankruptcy Code section 363);
(f) prohibition on modifying or altering in any material manner the
nature and type of its business (taken as a whole) except as
required by the Bankruptcy Code or orders entered by the
Bankruptcy Court;
(g) prohibition on prepaying prepetition Indebtedness (other than
for the avoidance of doubt, any payments under any financial or
physical trading transaction, including commodities
transactions, except as expressly provided for in the Loan
Documents or pursuant to first day or other orders entered by
the Bankruptcy Court upon pleadings in form and substance
reasonably satisfactory to the Agent);
(h) prohibition on consenting to the termination or reduction of the
Debtors exclusive plan filing and plan solicitation periods
under section 1121 of the Bankruptcy Code (the Exclusivity
Periods) or failing to object to any motion by a party in interest
(other than a Lender or the Agent) seeking to terminate or
reduce the Exclusivity Periods, in each case without the prior
written consent of the Agent; and
(i) such additional negative covenants (as modified to account for
the commencement of the Cases and other express provisions in
this Term Sheet or the Commitment Letter) as are consistent
with the Documentation Principles.
It is understood that there shall be no covenants regarding
minimum required commodity hedging or trading arrangements.
In addition, transactions (including any payments to affiliates)
provided for in any shared services or similar agreement
(Shared Services Agreement), any tax sharing agreements
(Tax Sharing Agreements), any sublease of property from
any Specified Affiliate to the Borrower or any of its restricted
subsidiaries (Property Subleases), and certain other
agreements or arrangements to be agreed to, each as in effect on
the date of the Commitment Letter (and as amended,
supplemented or modified in a manner that is not materially
adverse to the interests of the Lenders in their capacity as such)
and/or contemplated in the Initial Budget or any other Budget

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that has been approved by the Agent and the majority of the
Lead Arrangers from time to time (if any) in respect of any
applicable period will in any event be permitted by the Loan
Documents.
The DIP Facilities will include exceptions from the relevant
covenants allowing for the existence of liens, the posting of cash
collateral, the issuance of letters of credit, self-bonding and/or
the making of other deposits for the benefit of any trading
counterparties (including commodity hedging obligations),
utilities, governmental and quasi-governmental entities
(including the Federal Energy Regulatory Commission,
ERCOT, the Nuclear Regulatory Commission, the Public Utility
Commission of Texas and the Railroad Commission of Texas),
in each case in respect of any contractual, statutory and
regulatory requirements (including for purposes of posting
bonds and remediation obligations of any nature (including
mining reclamation bonds), complying with any contractual,
statutory or regulatory requirements, and for self-bonding in
respect of the Debtors and Specified Affiliates permits and
licenses). Further, the DIP Facilities will include exceptions
from the relevant covenants allowing for investments and/or
restricted payments (in the form of intercompany loans,
intercompany funding or otherwise) and transactions with
affiliates between the Borrower, any of its subsidiaries, and the
Specified Affiliates pursuant to which the Borrower may fund
investments in an amount to be agreed at any time outstanding
in, and, in addition, perform ordinary course transactions under
the intercompany cash management systems (including pursuant
to any Shared Services Agreements, any Tax Sharing
Agreements, or Property Sublease and certain other agreements
or arrangements to be agreed to) to the Specified Affiliates
during the pendency of the Cases.
Specified Affiliates means, collectively, the following affiliates of the
Borrower: (i) Comanche Peak Nuclear Power Company LLC; (ii) EFH
Corporate Services Company; (iii) EFH Properties Company;
(iv) Energy Future Holdings Corp; and (v) solely for the purpose of
permitting ordinary course intercompany cash management activities
subject to the order governing cash management, Oncor Electric
Delivery Holdings Company LLC and its subsidiaries.
Events of Default: The occurrence and continuance of any of the following events shall
constitute an Event of Default under the DIP Facilities (consistent, in
(a) The Final Order Entry Date shall not have occurred within 45
days after the Interim Order Entry Date;
(b) Any of the Cases shall be dismissed or converted to a Chapter 7

29
#4819-5662-6966
Case;
(c) A trustee, receiver, interim receiver, receiver or manager shall
be appointed in any of the Cases, or a responsible officer or an
examiner with enlarged powers shall be appointed in any of the
Cases (having powers beyond those set forth in Bankruptcy
Code sections 1106(a)(3) and (4));
(d) Any other superpriority administrative expense claim or claim
which is pari passu with or senior to the claims of the Agent or
the Lenders under the DIP Facilities (other than in each case the
Carve Out, the RCT Reclamation Support Carve Out or the
Obligations) or any lien that is pari passu with or senior to the
liens of the Agent or the Lenders under DIP Facilities shall be
granted in any of the Cases, except with the prior written
consent of the Agent or to the extent such lien constitutes a
permitted lien under the Loan Documents;
(e) The Bankruptcy Court shall enter an order granting relief from
the automatic stay to any creditor or party in interest to permit
foreclosure (or the granting of a deed in lieu of foreclosure or
the like) on any assets of the Debtors that have an aggregate
value in excess of $150,000,000;
(f) The Borrower shall default in the payment of (i) principal on the
Loans when due or reimbursement obligations in respect of any
Letter of Credit; or (ii) interest or fees, and such default shall
continue for more than five (5) days;
(g) Any representation or warranty made or deemed made by any
Debtor in any Loan Document shall prove untrue in any material
respect on the date as of which it is made or deemed made;
(h) The Borrower shall default (i) in the observance of any negative
covenant (and certain specified affirmative covenants consistent
with the Documentation Principles) in the DIP Agreement, (ii) if
applicable on any Test Date, the Financial Covenant; or (iii) in
the observance of any other covenant, term or condition not
otherwise specified herein which default continues for more
than 30 days after receipt of notice to the Borrower from the
Agent or the Requisite Lenders (defined below); provided,
however, that notwithstanding anything to the contrary herein or
in the Loan Documents, an Event of Default under the
Revolving Facility with respect to a failure of the Borrower to
satisfy the Consolidated Superpriority Secured Net Debt
Leverage Test shall not constitute an Event of Default under the
Term Facility or the Delayed-Draw Term Facility unless the
obligations under the Revolver Facility have been accelerated;
(i) An order shall be entered reversing, supplementing, staying for
a period of five (5) business days or more, vacating or otherwise

30
#4819-5662-6966
modifying the Interim Order or the Final Order in a manner that
is adverse to the interests of the Agent or the Lenders, or any of
the Debtors shall apply for authority to do so, without the prior
written consent of the Agent or the Requisite Lenders, or the
Interim Order or Final Order with respect to the DIP Facilities
shall cease to be in full force and effect;
(j) Any single judgment in excess of $150,000,000 as to any post-
petition obligation, or any judgments that are in the aggregate in
excess of $250,000,000 as to any one or more post-petition
obligations, shall be rendered against the Debtors and the
enforcement thereof shall not be stayed (by operation of law, the
rules or orders of a court with jurisdiction over the matter or by
consent of the party litigants, in each case, to the extent not paid
or covered by insurance provided by a carrier not disputing
coverage) or there shall be rendered against the Debtors a non-
monetary judgment with respect to a post-petition event that
causes or is reasonably expected to cause a Material Adverse
Event; provided that this clause (j) shall not apply to any
judgments as to any pre-petition obligation;
(k) Any Debtor makes any material payments relating to prepetition
obligations (including any adequate protection payments)
other than in accordance with a first day order, the Interim
Order, the Final Order, or as otherwise agreed to by the Agent;
(l) A plan shall be confirmed in any of the Cases that does not
provide for termination of the Commitments under the DIP
Facilities and the indefeasible payment in full in cash of the
Obligations (other than indemnities and other contingent
obligations not then due and payable) on the effective date of
such plan;
(m) The Interim Order or Final Order shall cease to create a valid
and perfected lien on the Collateral;
(n) (i) Any Debtor shall file a motion or pleading or commence a
proceeding that could reasonably be expected to result in an
impairment of the Agents or any of the Lenders material rights
or interests in their capacities as such under the DIP Facilities or
(ii) a determination by a court with respect to a motion, pleading
or proceeding brought by another party that results in such an
impairment; provided, however, that this clause (n) will not
apply to the termination of use of cash collateral (which shall be
exclusively governed by clause (t) below);
(o) Any Loan Document or any material provision thereof shall
cease to be effective (other than in accordance with its terms);
(p) Any of the Debtors shall fail to comply with the Interim Order

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#4819-5662-6966
or Final Order in any material respect;
2

(q) The Bankruptcy Court shall enter an order approving any claims
for recovery of amounts under section 506(c) of the Bankruptcy
Code or otherwise arising from the preservation of any
Collateral;
(r) The Bankruptcy Court shall enter a final non-appealable order
that is adverse in any material respect to the interests (when
taken as a whole) of the Agent or the Lenders or their respective
material rights and remedies in their capacity as such under the
DIP Facilities in any of the Cases; provided, however, that this
clause (r) will not apply to the termination of use of cash
collateral (which shall be governed exclusively by clause (t)
below);
(s) The Borrower shall default on payment due or there shall be any
event of default the effect of which is to accelerate or permit
acceleration with respect to material indebtedness (threshold to
be agreed) incurred after the Petition Date;
(t) The use of cash collateral by the Debtors shall be terminated and
the Debtors have not obtained use of cash collateral
(consensually or non-consensually) pursuant to an order in form
and substance acceptable to the Left Lead Revolving Arranger
and the Left Lead Term Facilities Arranger;
(u) The Loan Parties or any of their subsidiaries, or any person
claiming by or through the Loan Parties or any of their
subsidiaries, shall obtain court authorization to commence, or
shall commence, join in, assist or otherwise participate as an
adverse party in any suit or other proceeding against any of the
Agent or the Lenders in each case relating to the DIP Facilities;
(v) Any Debtor shall file any pleading seeking, or otherwise
consenting to, or shall support or acquiesce in any other
persons motion as to any matter set forth in paragraph (b), (c),
(d), (e), (i), (j), (k), (l), (m), (n), (q), (r), (t), or (u); and
(w) Such additional events of default (as modified to account for the
commencement of the Cases and other express provisions in this
Term Sheet or the Commitment Letter) as are consistent with
the Documentation Principles (with the change of control
definition to be agreed).

2
For the avoidance of doubt, the parties have agreed to this formulation on the understanding that if
provisions in the Interim Order or the Final Order are identified by the Agent as necessitating their own
Event of Default and such Events of Default are consented to by the Borrower (such consent not to be
unreasonably withheld), such Events of Default shall be included notwithstanding their absence in this
Term Sheet.

32
#4819-5662-6966
Notwithstanding anything to the contrary contained herein, any
Event of Default under the Loan Documents, and any or
similarly defined term under any Loan Document, other than
any Event of Default which cannot be waived without the
written consent of each Lender directly and adversely affected
thereby, shall be deemed not to be continuing if the events, act
or condition that gave rise to such Event of Default have been
remedied or cured (including by payment, notice, taking of any
action or omitting to take any action) or have ceased to exist.
Upon the enforcement of remedies after acceleration of the
Loans as a result of an Event of Default, (i) proceeds in the RCT
L/C Cash Collateral Account shall be distributed first to
payment of amounts due to the RCT Letter of Credit Issuers and
to other obligations with respect to the RCT Letters of Credit
and then to the holders of all Obligations, (ii) proceeds in the
General L/C Cash Collateral Account shall be distributed first to
payment of amounts due to the General Letter of Credit Issuers
and to other obligations with respect to the General Letters of
Credit and then to the holders of all Obligations and
(iii) proceeds of other Collateral will be paid: first, to holders of
any then outstanding obligations under the Carve Out (if any),
up to the amount thereof; second, to the RCT up to the amount
of any then outstanding obligations under the RCT Reclamation
Support Carve Out; and then, to the holders of Obligations.
Rights and Remedies Upon
Event of Default:
Upon the occurrence of an Event of Default and following the giving of
five calendar days notice to the Debtors (the Remedies Notice
Period), the Agent, on behalf of the Lenders, may (and at the direction
of the Requisite Lenders, shall) exercise all rights and remedies provided
for in the Loan Documents and may declare (i) the termination,
reduction or restriction of any further Commitment to the extent any
such Commitment remains, (ii) all Obligations to be immediately due
and payable, without presentment, demand, protest, or other notice of
any kind, all of which are expressly waived by the Debtors, and (iii) the
termination of the Loan Documents as to any future liability or
obligation of the Agents and the Lenders, but without affecting any of
the DIP liens or the Obligations.
During the Remedies Notice Period, the Debtors may continue to use
cash collateral in the ordinary course of business, consistent with past
practices and the most recently delivered Budget, but may not enter into,
or seek approval of, any transactions or arrangements (including,
without limitation, the incurrence of indebtedness or liens, investments,
restricted payments, asset sales or transactions with non-Debtor
affiliates) that are not in the ordinary course of business. Unless the
Bankruptcy Court orders otherwise during the Remedies Notice Period,
at the end of the Remedies Notice Period, the Debtors shall no longer
have the right to use or seek to use cash collateral, the automatic stay
pursuant to section 362 of the Bankruptcy Code shall be automatically
terminated without further notice to or order of the Bankruptcy Court,

33
#4819-5662-6966
and the Agent shall be permitted to exercise all rights against the
Collateral in accordance with the Loan Documents and the Interim
Order or Final Order, as applicable, and shall be permitted to satisfy the
Obligations, without further order or application or motion to the
Bankruptcy Court and without restriction or restraint by any stay under
section 362 or 105 of the Bankruptcy Code. Notwithstanding anything
herein to the contrary, the automatic stay pursuant to section 362 of the
Bankruptcy Code shall be automatically terminated for the purposes of
giving any notice contemplated hereunder.
During the Remedies Notice Period, any party in interest shall be
entitled to seek an emergency hearing with the Bankruptcy Court solely
for the purpose of contesting whether an Event of Default has occurred
and/or is continuing, and the Debtors waive their right to, and shall not
be entitled to seek relief, including without limitation, under section 105
of the Bankruptcy Code, to the extent that such relief would in any way
impair or restrict the rights and remedies of the Agent, on behalf of the
Lenders, set forth in the Interim Order, Final Order, or the Loan
Documents.
The delay or failure to exercise rights and remedies under the Interim
Order, the Final Order or the Loan Documents by the Agent, on behalf
of the Lenders, shall not constitute a waiver of such Agents rights
thereunder or otherwise, unless any such waiver is pursuant to a written
instrument executed in accordance with the terms of the applicable Loan
Documents.
Conditions to Initial
Availability:
The obligation of the Lenders to make the initial Loans and/or issue
Letters of Credit on the Closing Date under the DIP Facilities will be
subject only to the conditions precedent listed on Annex II attached
hereto under the captions Conditions to Initial Availability and, as
applicable, Additional Conditions to Availability of Delayed-Draw
Term Loans and RCT Letters of Credit.
Conditions to Full Availability: After the Closing Date, the obligation to provide Loans and/or issue
Letters of Credit up to the full amount of the Commitments shall be
subject to the satisfaction or waiver of the conditions precedent listed on
Annex II attached hereto under the captions Condition to Full
Availability and, as applicable, Additional Conditions to
Availability of Delayed-Draw Term Loans and RCT Letters of
Credit, and in Conditions to All Subsequent Borrowings below.

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#4819-5662-6966
Conditions to All Subsequent
Borrowings:
Consistent in each case with the Documentation Principles, the
conditions to all Loans and/or issuance of Letters of Credit (other than
such Loans made and/or Letters of Credit issued on the Closing Date)
will include requirements relating to prior written notice of borrowing,
the accuracy in all material respects of all representations and
warranties, the absence of any Default or Event of Default and the
following:
(a) The Interim Order or the Final Order, as the case may be, is in
full force and effect;
(b) As a result of such extension of credit, usage of the
Commitments shall not exceed (i) the applicable Commitments
then in effect, (ii) the aggregate amount authorized by the
Interim Order or the Final Order, as the case may be, (iii) the
maximum amount of net borrowings contemplated to be
outstanding as reflected in the Budget and other Budget
milestones to be mutually agreed to by the Borrower and the
Agent (it being agreed that the Budget will contemplate
permitted variances); and
(c) The Debtors shall have paid the balance of all fees then earned,
due and payable in respect of the DIP Facilities as referenced
herein.
Additional Conditions to
Availability of Delayed-Draw
Term Loans and RCT Letters
of Credit:
The obligation of the Lenders to make Delayed-Draw Term Loans
and/or issue RCT Letters of Credit will also be subject to the additional
conditions precedent listed on Annex II attached hereto under the
caption Additional Conditions to Availability of Delayed-Draw
Term Loans and RCT Letters of Credit.
Assignments and
Participations:
Subject in each case to the Documentation Principles, each Lender may
assign all or any part of the Revolver Facility, the Delayed-Draw Term
Facility and/or the Term Facility to one or more affiliates, banks,
financial institutions or other entities, in each case, with the prior written
consent of the Borrower (unless a Term Loan or Delayed-Draw Term
Loan is being assigned to a Lender, an affiliate of a Lender, or an
approved fund of such Lender or its affiliate) and the Agent (unless a
Term Loan or Delayed-Draw Term Loan is being assigned to a Lender,
an affiliate of a Lender or an approved fund of such Lender or its
affiliate) (in each case, not to be unreasonably withheld, conditioned or
delayed); provided, however, that under no circumstances will
assignments be made to a Disqualified Institution (defined below), and
that the consent of the Borrower will not be required during the
continuance of an Event of Default. Upon such assignment, such
affiliate, bank, financial institution or entity will become a Lender for all
purposes under the Loan Documents.
The Lenders will also have the right to sell participations (other than to
Disqualified Institutions,) subject to customary limitations on voting

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#4819-5662-6966
rights, in the DIP Facilities.
Disqualified Institutions means (a) any company engaged principally
in the business of energy or power generation and/or transmission as
identified in writing to the Agent by the Company from time to time,
(b) any company whose principal business is that of an energy or power
merchant as identified in writing to the Agent by the Company from
time to time, (c) any financial institution identified in writing to the Joint
Lead Arrangers by the Borrower on or prior to the date of the
Commitment Letter (including any such persons affiliates that are
clearly identifiable on the basis of such affiliates names) and (d) a
defaulting Lender (as described below). The list of Disqualified
Institutions shall be posted for the benefit of the Lenders. Upon the
identification in writing by the Borrower to the Agent of any additional
Disqualified Institutions pursuant to clause (a) or (b) above, the Agent
shall promptly post such addition to the list to the Lenders; provided that
any additional person so identified shall not be deemed a Disqualified
Institution until such time as such addition to the list is posted to the
Lenders.
Requisite Lenders: Voting with respect to the DIP Facilities will be done solely by the
Lenders (and not, for the avoidance of doubt, by any holders of Eligible
Pari Passu Hedges). The vote of the Lenders holding more than 50% of
total Commitments under the DIP Facilities (or if no Commitments are
outstanding, total exposure) (the Requisite Lenders) shall be required
to amend, waive or modify any terms and conditions of the DIP
Facilities (with customary exceptions consistent with the Documentation
Principles where only the consent of the relevant Agent or Letter of
Credit Issuer will be required), except that with respect to matters
relating to, among others, the reduction in, or compromise of payment
rights with respect to, principal or interest rates, extension of maturity (it
being understood and agreed that a waiver or amendment of the
Extension Conditions (other than the Extension Conditions set forth
under clauses (1) (solely with respect to a payment Event of Default)
and (6) of the definition thereof, which will be subject to the consent of
each Lender) will be subject to Requisite Lender consent) or scheduled
date of payment of any interest or fees due, release of material
guarantees and/or liens granted on all or substantially all of the
Collateral (other than guarantees, liens, or Collateral subject to permitted
dispositions, permitted mergers, consolidations, reorganizations, etc.),
reduction in voting thresholds and increases in the RCT Reclamation
Support Carve Out, the consent of the Lenders holding 100% of total
Commitments (or if no Commitments are outstanding, total exposure) in
respect of which the consent of all Lenders directly and adversely
affected thereby will be required, except that the Commitment of a
Lender may not be increased without such Lenders consent; and except,
further, that any amendment, waiver or modification of any terms or
conditions relevant to the Consolidated Superpriority Secured Net Debt
Leverage Ratio Test shall only require more than 50% of total Revolver
Commitments (or if no Commitments are outstanding, total exposure

36
#4819-5662-6966
under the Revolver Facility).
Defaulting Lenders: The Loan Documents will contain customary provisions (but consistent
in any event with the Documentation Principles) relating to defaulting
Lenders (including provisions relating to the suspension of voting rights
and rights to receive fees, and the termination or assignment of
Commitments and Loans held by defaulting Lenders at par).
Taxes: Consistent with each case to the Documentation Principles, the Loan
Documents shall contain customary provisions (a) protecting the
Lenders against increased costs or loss of yield resulting from changes
in reserve, tax, capital adequacy and other requirements of law and from
the imposition of or changes in withholding or other taxes (including in
respect of Dodd-Frank and Basel III) and (b) indemnifying the Lenders
for breakage costs incurred in connection with any prepayment of a
LIBOR Loans on a day other than the last day of an interest period with
respect thereto.
In connection with any proposed amendment, waiver or other
modification to the DIP Facilities (a Proposed Change) requiring the
consent of all Lenders or all directly adversely affected Lenders, if the
consent to such Proposed Change of all Lenders whose consent is
required is not obtained, but the consent of the Lenders with a majority
of the Loans and commitments held by the applicable group of Lenders
is obtained (any such Lender whose consent is required but is not
obtained, a Non-Consenting Lender), then the Borrower may, at its
sole expense, upon notice to such Non-Consenting Lender and the
Agent, require such Non-Consenting Lender to assign and delegate,
without recourse (in accordance with and subject to all restrictions
otherwise applicable to assignments), all its interests, rights and
obligations under the DIP Facilities to an assignee that shall assume
such obligations or terminate such Non-Consenting Lenders
commitments; provided that such Non-Consenting Lender shall have
received payment of an amount equal to the outstanding principal of its
Loans, accrued interest thereon, accrued fees and all other amounts then
due and owing to it under the DIP Facilities from the assignee (to the
extent of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts).
Indemnity; Expenses: The Loan Documents will provide, in each case to the extent consistent
with the Documentation Principles, that the Borrower shall indemnify,
pay and hold harmless the Agent, the Joint Lead Arrangers, the Letter of
Credit Issuers, and the Lenders and their affiliates (and their respective
controlling persons, directors, officers, partners, employees, agents,
advisors and other representatives (collectively, the Related Parties))
(each, an Indemnified Person) against any loss, claim, damage,
liability or expense incurred in respect of the DIP Facilities
contemplated hereby or the use of proceeds thereof or the Transactions
or any claim, litigation, investigation or proceeding (a Proceeding)
relating to any of the foregoing, regardless of whether any Indemnified
Person is a party thereto, whether or not such Proceedings are brought

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by any Debtor, its equity holders, affiliates, creditors or any other
person, and to reimburse each Indemnified Person promptly following
written demand for any reasonable legal or other out-of-pocket expenses
incurred in connection with investigating or defending any of the
foregoing (except, in the case of any Indemnified Person, to the extent
resulting (i) from the gross negligence, bad faith or willful misconduct
of such Indemnified Person (or its Related Parties), in each case as
determined in a final non-appealable judgment of a court of competent
jurisdiction, (ii) from a dispute solely among Indemnified Persons other
than any claims against any Indemnified Person in its capacity or in
fulfilling its role as an Agent or Joint Lead Arranger or any similar role
under the DIP Facilities and other than any claims arising out of any act
or omission on the part of the Borrower or the other Debtors or (iii) from
any material breach of the Loan Documents by such Indemnified Person
(or its Related Parties), as determined in a final non-appealable
judgment of a court of competent jurisdiction) and (b) the Borrower
shall reimburse within 10 days of written demand (together with
reasonably detailed supporting documentation) the Agent, the Lenders
and the Joint Lead Arrangers for their reasonable and documented out-
of-pocket expenses incurred in connection with the negotiation,
documentation, syndication and administration of the DIP Facilities, any
amendments or waivers with respect thereto, any Event of Default in
respect of the DIP Facilities and any exercise of remedies in respect
thereof (including reasonable and documented out-of-pocket prepetition
and post-petition fees, charges and disbursements of legal counsel,
financial advisors and third-party appraisers and consultants advising the
Agent incurred in connection with the Agents participation in the
Cases, limited in the case of legal counsel to one primary counsel (and
(i) appropriate local counsel in applicable foreign and local jurisdictions,
but limited to one local counsel in each such jurisdiction, (ii) appropriate
regulatory counsel and (iii) solely in the case of a conflict of interest,
one additional counsel in each relevant jurisdiction to the affected
indemnified persons similarly situated)); provided, however, that the
Debtors shall promptly provide copies of invoices received on account
of fees and expenses of the professionals retained as provided for in the
DIP Documents to counsel to the Committee and the United States
Trustee, and the Bankruptcy Court shall have exclusive jurisdiction over
any objections raised to the invoiced amount of the fees and expenses
proposed to be paid, which objections may only be raised within ten
days after receipt thereof. In the event that within ten days from receipt
of such invoices the Debtors, the United States Trustee or counsel to the
Committee raise an objection to a particular invoice, and the parties are
unable to resolve any dispute regarding the fees and expenses included
in such invoice, the Bankruptcy Court shall hear and determine such
dispute; provided, that payment of invoices shall not be delayed based
on any such objections and the relevant professional shall only be
required to disgorge amounts objected to upon being so ordered
pursuant to a final order of the Bankruptcy Court.


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Governing Law and
Jurisdiction:
The Loan Documents will provide that the Debtors and the Lenders will
submit to the exclusive jurisdiction and venue of the Bankruptcy Court,
or in the event that the Bankruptcy Court does not have or does not
exercise jurisdiction, then in any state or federal court of competent
jurisdiction in the Southern District of New York and shall waive any
right to trial by jury. New York law shall govern the Loan Documents.
Miscellaneous: The terms and conditions of the interim orders and final orders (e.g.
506(c) waivers, marshaling, and successors and assigns) to be mutually
agreed.
Counsel to Joint Lead
Arrangers and the Agent:
Milbank, Tweed, Hadley & McCloy LLP.


#4819-5662-6966
Annex I
LIST OF DEBTORS
Name Bankruptcy Status
Jurisdiction of
Organization
Energy Future Competitive Holdings Company LLC;
Texas Competitive Electric Holdings Company LLC;
4Change Energy Company;
4Change Energy Holdings LLC;
Big Brown 3 Power Company LLC;
Big Brown Lignite Company LLC;
Big Brown Power Company LLC;
Collin Power Company LLC;
Decordova Power Company LLC;
Decordova II Power Company LLC;
Generation MT Company LLC;
Generation SVC Company;
Lake Creek 3 Power Company LLC;
Luminant Big Brown Mining Company LLC;
Luminant Energy Company LLC;
Luminant Energy Trading California Company;
Luminant ET Services Company;
Luminant Generation Company LLC;
Luminant Holding Company LLC;
Luminant Mineral Development Company LLC;
Luminant Mining Company LLC;
Luminant Renewables Company LLC;
Texas
Delaware
Texas
Texas
Texas
Texas
Texas
Delaware
Texas
Delaware
Delaware
Delaware
Texas
Texas
Texas
Texas
Texas
Texas
Texas
Delaware
Texas
Texas
Texas

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Name Bankruptcy Status
Jurisdiction of
Organization
Martin Lake 4 Power Company LLC;
Monticello 4 Power Company LLC;
Morgan Creek 7 Power Company LLC;
NCA Resources Development Company LLC;
Oak Grove Management Company LLC;
Oak Grove Mining Company LLC;
Oak Grove Power Company LLC;
Sandow Power Company LLC;
TCEH Finance, Inc.;
Tradinghouse 3 & 4 Power Company LLC;
Tradinghouse Power Company LLC;
TXU Energy Retail Company LLC;
TXU Energy Solutions Company LLC;
TXU Retail Services Company;
TXU SEM Company;
Valley NG Power Company LLC;
Valley Power Company LLC.
Texas
Texas
Texas
Texas
Delaware
Texas
Texas
Texas
Delaware
Texas
Texas
Texas
Texas
Delaware
Delaware
Texas
Texas


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Annex II
TEXAS COMPETITIVE ELECTRIC HOLDINGS COMPANY LLC
SUMMARY OF CONDITIONS PRECEDENT TO THE DIP FACILITIES
A. CONDITIONS TO INITIAL AVAILABILITY
1. Interim Order/Bankruptcy Matters.
(a) The Bankruptcy Court shall have entered, upon motion in form and substance satisfactory
to the Left Lead Arrangers, an interim order in form and substance satisfactory to the Left
Lead Arrangers (the Interim Order) as to the Initial Availability no later than ten (10)
business days after the date of commencement of the Cases, approving and authorizing,
on an interim basis, the DIP Facilities, the provisions thereof and the priorities and liens
(including priming liens) granted therein.
(b) The Interim Order shall not have been reversed, modified, amended, stayed or vacated, in
the case of any modification or amendment, in a manner, that is adverse to the Lenders,
without the consent of the Left Lead Arrangers.
(c) The Debtors shall be in compliance in all material respects with the Interim Order.
(d) The Cases shall have been commenced in the Bankruptcy Court and all of the first day
orders and all related pleadings to be entered at the time of commencement of the Cases
or shortly thereafter shall have been reviewed in advance by the Left Lead Arrangers, and
shall be reasonably satisfactory in form and substance to the Left Lead Arrangers, but in
the case of orders relating to cash management and adequate protection, shall be
satisfactory in form and substance to the Left Lead Arrangers.
(e) No trustee or examiner with enlarged powers (having powers beyond those set forth in
Bankruptcy Code sections 1106(a)(3) and (4)) shall have been appointed with respect to
the operations or the business of the Debtors.
2. Financial Statements, Budgets and Reports.
(a) The Debtors shall have delivered the Budget to the Agent and the Lenders, which shall be
in form and substance reasonably satisfactory to the Agent and the Joint Lead Arrangers,
and the Agent and the Joint Lead Arrangers hereby confirm the receipt of the Budget
dated [____], 2014 in form and substance reasonably satisfactory to the Agent and the
Joint Lead Arrangers prior to the date hereof;
(b) The Debtors shall have delivered to the Agent and the Lenders a base case model,
including a statement of cash sources and uses of all free cash flow for the tenor of the
DIP Facilities, which shall be in form and substance reasonably satisfactory to the Agent
and the Joint Lead Arrangers, and the Agent and the Joint Lead Arrangers hereby confirm
the receipt of a base case model dated [____], 2014 in form and substance reasonably
satisfactory to the Joint Lead Arrangers and the Lenders prior to the date hereof; and
(c) The Agent and the Lenders shall have received reasonably requested financial
information.

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3. Performance of Obligations.
(a) All invoiced costs, fees, expenses (including, without limitation, reasonable legal fees)
and other compensation contemplated by the Loan Documents and the Fee Letter to be
payable to the Commitment Parties, the Agent and the Lenders in respect of the DIP
Facilities shall have been paid to the extent earned, due and payable;
(b) Representations and warranties of the Debtors shall be true and correct in all material
respects (or in all respects for representations and warranties qualified by materiality or
Material Adverse Effect); and
(c) No Default or Event of Default shall exist under the DIP Facilities.
4. Customary Closing Documents and Other Conditions.
(a) The Debtors shall have complied with the following closing conditions: (i) the delivery of
customary legal opinions as to authority, authorization, execution and delivery; corporate
records and documents from public officials, including good standing certificates;
officers certificates; and notice of borrowing; (ii) evidence of authority; and
(iii) obtaining of any governmental consents, if any, necessary in connection with the DIP
Facilities, the financing thereunder and related transactions. The Lenders shall have
received at least five (5) days prior to the Closing Date all documentation and other
information required by bank regulatory authorities under applicable know-your-
customer and anti-money laundering rules and regulations, including the Patriot Act.
(b) The Loan Documents (which shall be consistent with the Documentation Principles) shall
have been entered into by the Debtors.
(c) The Agent shall have received results of a Uniform Commercial Code search for the
jurisdiction of organization of the Debtors, a federal tax lien search for the jurisdiction of
the chief executive office of the Debtors, and such other lien and/or other searches
reasonably requested by the Agent as are customary for transactions of this type.
(d) The Agent shall have received proper financing statements (Form UCC-1 or the
equivalent) for filing under the UCC in the jurisdiction of organization of each Debtor.
(e) As a result of the extension of such credit, usage of the Commitments shall not exceed (i)
the applicable Commitments then in effect and (ii) the aggregate amount authorized by
the Interim Order.
B. CONDITIONS TO FULL AVAILABILITY
1. Final Order.
(a) Not later than 45-days following the Interim Order Entry Date, a final order shall have
been entered by the Bankruptcy Court (the Final Order) in form and substance
satisfactory to the Left Lead Arrangers on a motion by the Debtors that is in form and
substance satisfactory to the Left Lead Arrangers, approving and authorizing on a final
basis the matters and containing the provisions described in A.1. above.

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(b) The Final Order shall be in full force and effect and shall not have been reversed,
modified, amended, stayed or vacated, and with respect to any modification or
amendment, in a manner that is adverse to the Lenders without the consent of the Left
Lead Arrangers.
(c) The Debtors shall be in compliance with the Final Order.
2. Other Conditions.
(a) The Agent and the Lenders shall have received their required periodic updates of the
Budget;
(b) No Default or Event of Default shall exist under any of the DIP Facilities;
(c) Representations and warranties of the Debtors shall be true and correct in all material
respects;
(d) The Debtors shall have paid the balance of all invoiced fees then earned, due and payable
in respect of the DIP Facilities as referenced in the Fee Letter; and
the Final Order.
C. ADDITIONAL CONDITIONS TO AVAILABILITY OF DELAYED-DRAW TERM LOANS
AND RCT LETTERS OF CREDIT
1. The RCT Carve Out Support Rejection Notice shall have been exercised (a) prior to the Delayed-
Draw Termination Date and (b) prior to the making of such Delayed-Draw Term Loans or the
issuance of such RCT Letters of Credit.

EXHIBIT G

EFIH FIRST LIEN DIP FINANCING TERM SHEET

ENERGY FUTURE INTERMEDIATE HOLDING COMPANY LLC AND EFIH FINANCE, INC.
SUMMARY OF TERMS AND CONDITIONS OF THE $5.4 BILLION
SENIOR SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION FACILITY
(TERM SHEET)
Capitalized terms used but not defined in this Term Sheet will have the meanings set forth in the
Commitment Letter to which this Term Sheet is attached (the Commitment Letter).
Borrower: Energy Future Intermediate Holding Company LLC (EFIH and
EFIH Finance Inc. (EFIH Finance, and together with EFIH, the
Borrower), each as a debtor-in-possession under Chapter 11 of the
United States Bankruptcy Code (the Bankruptcy Code) in jointly
administered cases (collectively the Cases) in the Bankruptcy Court
for District of Delaware (or such other court as may be acceptable to
Commitment Parties in their sole discretion, the Bankruptcy
Court).
Guarantors: All obligations under the DIP Facility (defined below) and the other
Loan Documents (defined below) will be unconditionally guaranteed
(collectively, the Guarantee) by each subsidiary of the Borrower
(each a Guarantor and collectively, the Guarantors and
collectively with the Borrower, the Debtors) that may be required to
become a guarantor under the definitive documentation of the DIP
Facility (the Loan Documents).
Oncor Entities and EFCH
Entities:
For the avoidance of doubt, Oncor Electric Delivery Holdings
Company LLC and its subsidiaries (the Oncor Entities) and Energy
Future Holdings Corp. and its subsidiaries other than the Borrower and
its subsidiaries including the Oncor Entities (the EFH Entities) (i)
will not be Guarantors under the DIP Facility (it being understood that
certain of the EFH Entities will be in jointly administered cases
expected to be filed on or prior to the Closing Date in the Bankruptcy
Court in respect of other debtors-in-possession financings (the TCEH
DIP Facility)), and (ii) will not be directly or indirectly restricted in
the conduct of their respective businesses by the Loan Documents
(whether by application of representations and warranties, affirmative
covenants, negative covenants, Events of Default or otherwise) (other
than through customary covenants restricting transaction with
affiliates, investments and loans).
Prepetition Facilities:
EFIH Secured Notes Approximate
Outstanding
Principal Amount

10.00% Senior Secured First Lien
Notes due 2020
$3.482 billion

2

Notes due 2017 (collectively with the
Notes due 2020, the EFIH First Lien
Secured Notes)
$503 million
11.00% Senior Secured Second Lien
Notes due 2021
$406 million
Notes due 2022 (collectively with the
Notes due 2021, the EFIH Second
Lien Secured Notes)
$1.75 billion

DIP Facility:

A superpriority non-amortizing term credit facility (the Term
Facility or the DIP Facility) in an aggregate principal amount of
$5,400,000,000 (the Term Commitments or the Commitments).
Up to $5,400,000,000 of the Term Facility will be available in
connection with Full Availability (defined below) in the form of term
loans for the account of the Borrower (Term Loans, or the
Loans). Amounts drawn under the Term Facility may not be re-
borrowed once repaid.
It is understood that a portion of the DIP Facility may be provided by
(i) the exchange or other roll pursuant to an exchange agreement,
restructuring support agreement or other similar document or
agreement in respect of your prepetition indebtedness into Term Loans
or (ii) other Backstop Commitment (as defined in the Commitment
Letter), in each case as contemplated by Section 1 of the Commitment
Letter, and all such amounts shall constitute Term Loans under the
DIP Facility.
Notwithstanding anything to the contrary contained herein, in the
Commitment Letter, or in the Fee Letter, (i) the exchange rate for
exchanging (or otherwise rolling such indebtedness into the
Obligations) any such prepetition indebtedness (as identified in the
Commitment Letter) into Term Loans shall be in the sole discretion of
the Borrower, (ii) the Borrower shall be entitled to allocate and give
fees (including in the form of OID solely to the extent related to the
exchange rate under the Exchange Arrangements and the Upfront OID
(as defined in the Fee Letter)) to any such person in its sole discretion,
and (iii) neither the Agent, any J oint Lead Arranger shall have any
right to consent to the participants (or their allocations) in any
Exchange Arrangement or any person providing the Backstop
Commitment (subject to the terms in the Commitment Letter).

3

Purpose/Use of Proceeds: The proceeds of the DIP Facility will be used, in a manner consistent
with the terms of the Budget (defined below) (but not subject to any
Budget compliance covenant in respect thereof): (i) first, to pay (w)
transaction fees, liabilities and expenses (including all Professional
Fees) (defined below) and other administration costs incurred in
connection with the Cases and the negotiation, syndication,
documentation (including any engagement or commitment letters),
execution and closing of the DIP Facility, (x) the refinancing of the
EFIH First Lien Secured Notes (as contemplated on Annex I)
(including through the exchange or other roll of EFIH First Lien
Secured Notes into Term Loans), and (y) Settlement Payments (as
defined below), and (ii) second, to finance any and all working capital
needs and for any other general corporate purposes, and to comply
with any legal and/or regulatory requirements of governmental and
quasi-governmental entities of the Debtors, (and, to the limited extent
set forth below, of the Specified Affiliates). Settlement Payments
shall mean amounts paid in accordance with the terms of any exchange
agreement or similar document, agreement or arrangement to settle
claims (including in respect of principal, interest and premium (if
any)) in respect of the EFIH First Lien Secured Notes.
Left Lead DIP Facility
Arranger:
Deutsche Bank Securities Inc. (the Left Lead DIP Facility
Arranger).
Joint Lead Arrangers: The Left Lead DIP Facility Arranger, Citigroup Global Markets Inc.
(Citi), Merrill Lynch, Pierce, Fenner & Smith Incorporated
(MLPFS), Morgan Stanley Senior Funding, Inc. (Morgan
Stanley), Barclays Bank PLC (Barclays), RBC Capital Markets
(RBCCM) and Union Bank, N.A. (Union Bank and, together
with the Left Lead DIP Facility Arranger, MLPFS, Citi, Morgan
Stanley, Barclays and RBCCM, collectively, the Joint Lead
Arrangers).
Co-Managers: Loop Capital Markets, LLC (Loop Capital) and The Williams
Capital Group, L.P. (Williams Capital, together with Loop Capital,
the Co-Managers).
DIP Facility Lenders: The Lenders under the Term Facility are referred to as the Term
Lenders or the Lenders.
Administrative Agent: Deutsche Bank AG New York Branch (together with its permitted
successors and assigns, the Administrative Agent or the Agent).
DIP Facility Full Availability: Upon the Bankruptcy Courts entry of the Final Order (the Final
Order Entry Date), the full amount of the Commitments shall be
available to the Borrower subject to compliance with the applicable
terms, conditions and covenants described in this Term Sheet (the
Full Availability).
Incremental Facilities: The Borrower shall be entitled to enter into one or more incremental
term loan facilities (the Junior Incremental Term Facilities or the

4

Junior Incremental Facilities) that will rank junior in right of
payment with the DIP Facility and will have the same guarantees as
the DIP Facility, and be secured by a lien on the same Collateral
securing the DIP Facility that is junior to the lien securing the DIP
Facility, in a principal amount not to exceed $3,000,000,000 in the
aggregate; provided that:
(i) no Event of Default or event that upon the passage of time, the
giving of notice, or both, would become an Event of Default
(Default) under the Term Facility would exist immediately after
giving effect thereto, and the representations and warranties in the
Loan Documents shall be true and correct in all material respects on
and as of the date of the incurrence of each such J unior Incremental
Facility (or to the extent such representations and warranties relate to
an earlier date, they shall be true and correct in all material respects as
of such earlier date);
(ii) such J unior Incremental Facilities may be provided by then
existing Lenders or, other persons, provided that no existing Lender
will be obligated to provide such Incremental Facilities without its
consent;
(iii) the maturity date of such J unior Incremental Facilities shall be
no earlier than the maturity date of the Term Facility, and such
Incremental Facilities shall require no scheduled amortization prior to
the final maturity of the J unior Term Facility;
(iv) the interest rates, interest margins, any rate floors, fees,
original issue and other funding discounts and premiums and (subject
to clause (iii) above) amortization schedule applicable to such J unior
Incremental Facility shall be determined by the Borrower and the
lenders thereunder;
(v) no part of the principal amount (including any principal
amount arising from PIK interest or fees) of the J unior Incremental
Term Facilities shall be required to be repaid in cash; and, subject to
the proviso to this clause (v), at the final maturity of each J unior
Incremental Term Facility (which shall occur at the exit of the Debtors
from the Cases), the principal amount (including any principal amount
arising from PIK interest or fees) of the loans under the J unior
Incremental Term Facilities shall be converted into equity in
accordance with the Plan of Reorganization; provided that nothing in
the final documentation for the DIP Facility shall prevent a refinancing
and/or repayment of the Junior Incremental Term Facilities at the exit
of the Debtors from the Cases if (x) such refinancing and/or repayment
occurs after the DIP Facility have been repaid in full in cash and (y)
the Plan of Reorganization permits the Borrower to make such
repayment and/or incur indebtedness to refinance such J unior
Incremental Term Facilities;
(vi) the proceeds of the J unior Incremental Term Facilities shall be

5

used solely to repay in full the EFIH Second Lien Secured Notes and
all interest, premium and fees in connection with such repayment;
(vii) the relative priority between the lien securing the J unior
Incremental Term Facilities and the lien securing the DIP Facility shall
be governed by an intercreditor agreement reasonably satisfactory to
the Agent and the Borrower, which intercreditor agreement shall
provide that so long as any obligations are outstanding under the DIP
Facility, the Agent on behalf of the DIP Facility will control at all
times all remedies and other actions related to the Collateral, and that
the secured parties under the J unior Incremental Term Facilities will
not be entitled to take any action with respect to the Collateral (other
than limited actions to preserve and protect the liens securing the
J unior Incremental Term Facilities that do not impair the liens
securing the DIP Facility);
(viii) except as otherwise set forth above, each J unior Incremental
Term Facility shall be on terms and pursuant to documentation to be
determined by the Borrower and the lenders providing such J unior
Incremental Term Facility; provided that (1) the baskets for the
covenants and events of default under the J unior Incremental Term
Facility will be sized at a cushion reasonably satisfactory to the Agent
to the levels of the baskets under the corresponding covenants and
events of default under the DIP Facility, and (2) to the extent such
terms and documentation are not consistent with the Term Facility
(except to the extent permitted or required by clauses (iii) through (vii)
above or clause (1) above or with respect to fees and immaterial
terms), they shall be reasonably satisfactory to the Administrative
Agent; and
(ix) the Final Order Entry Date shall have occurred.
Documentation Principles: Documentation Principles means that (a) except as otherwise
expressly set forth herein in this Term Sheet or the Commitment
Letter, the terms and conditions of the Loan Documents shall be
consistent with the terms and conditions, and in no event more
burdensome on the Debtors, than the terms and conditions of TCEH
DIP Facility (the Specified Facility); (b) the Loan Documents will
be prepared on the basis of, and using as precedent, the Specified
Facility and its related collateral documents; and (c) generally all
terms and conditions (including exceptions, thresholds, baskets, grace
periods, cure periods and financial definitions) in the Loan Documents
will be consistent with those in the Specified Facility and its related
collateral documents and in no event more burdensome on the
Debtors, in each case modified solely to the extent (i) required to
reflect the express terms and conditions set forth in this Term Sheet
and the Commitment Letter, (ii) required to reflect the shorter tenor of
the DIP Facility, (iii) required to reflect that the Loan Documents will
be for a borrower that is a holding company without any operations,
(iv) to account for the existence and continuance of the Cases, the
operational needs and requirements of the Borrower, the Guarantors

6

and the Specified Affiliates (defined below) between the Petition Date
and the Maturity Date (including as set forth in the last two paragraphs
of Negative Covenants below) and to include provisions applicable
to debtor-in-possession facilities generally (including (subject to the
last two paragraphs of Negative Covenants below) customary
changes to be mutually agreed with respect to additional restrictions
on indebtedness, liens, restricted payments, asset sales and
investments in persons that are not subsidiaries of the Borrower), and
(v) as otherwise agreed by the Borrower.
Budget: As used in this Term Sheet and in Annex I hereto, Budget means
the following:
Beginning on the Final Entry Order Date, in the case of the initial
Budget delivered as a condition precedent to the occurrence of the
Closing Date, a statement of cash sources and uses of all free cash
flow for the next full 3-calendar months of the Debtors broken down
by month, including the anticipated uses of the DIP Facility for such
period, and after such 3-calendar month period, at the end of each
fiscal quarter (or, at the election of the Borrower, at the end of each
calendar month or such other earlier period as may be agreed).
The Borrower shall also provide on a monthly basis a Budget variance
report/reconciliation for each calendar month (delivered no later than
the end of the subsequent calendar month), (i) showing a statement of
actual cash sources and uses of all free cash flow for the immediately
preceding calendar month, noting therein all material variances from
values set forth for such historical periods in the most recently
delivered Budget, and shall include explanations for all material
variances, and (ii) certified as to its reasonableness when made by the
Borrower.
Annual Operating Forecast: Beginning on the date 60 days after the Final Order Entry Date (and
no later than December 1, 2014 for the business plan and operating
budget covering 2015 and no later than December 1, 2015 for the
business plan and operating budget covering 2016), on an annual
basis, the approved annual business plan and projected operating
budget through the Stated Maturity Date (the Annual Operating
Forecast), broken down by month, including, without limitation,
income statements, balance sheets, cash flow statements, projected
capital expenditures, asset sales, a line item for total available liquidity
for the period of such Budget, and which shall set forth the anticipated
uses of the DIP Facility for such period; the associated underlying
assumptions shall be certified by the Borrower as being reasonable
when made.
Both the Budget and the Annual Operating Forecast shall provide,
among other things, for the payment of the fees and expenses relating
to the DIP Facility, ordinary course administrative expenses,
bankruptcy-related expenses and working capital, and other general
corporate needs; provided, however, that notwithstanding anything to

7

the contrary in this Term Sheet or in any of the Loan Documents, the
Professional Fees (defined below) will be due and payable, and will be
paid by the Debtors whether or not consistent with the items or
amounts set forth in the Budget or the Annual Operating Forecast; and
provided, further that under no circumstance will the Budget or the
Annual Operating Budget be construed as a cap or limitation on the
amount of the Professional Fees due and payable by the Debtors.
Maturity: The maturity date of the DIP Facility will be (and all Loans and other
payment obligations under the DIP Facility shall be repaid in full in
cash on) the earliest of (the Maturity Date): (i) stated maturity,
which shall be twenty-four (24) months from the Closing Date
(defined below), subject to a six-month extension on the last day of
such 24-month period (the Stated Maturity Date) if on such last
day (1) no Event of Default is outstanding, (2) a Chapter 11 plan of
reorganization for the Debtors (the Plan of Reorganization) has
been filed, (3) a hearing has been scheduled for the confirmation of
such Plan of Reorganization, (4) the Debtors are working in good faith
to confirm such Plan of Reorganization, (5) an updated Budget and
Annual Operating Forecast have been delivered by the Borrower at
least ten days prior to the first day of such extension, which Budget
and Annual Operating Forecast demonstrate minimum liquidity
sufficient through such additional six-month period plus
$150,000,000, (6) the Borrower has paid an extension fee of 25 basis
points on the outstanding principal amount of the Term Loans, and (7)
the maturity date of each J unior Incremental Facility has
simultaneously extended to a date not earlier than the extended
Maturity Date (subclauses (1) through (7), the Extension
Conditions); (ii) the effective date of the Plan of Reorganization;
(iii) August 26, 2014 if the Final Order Entry Date shall not have
occurred by such date; (iv) the date of the consummation of a sale of
all or substantially all of the Debtors assets or stock under section 363
of the Bankruptcy Code; and (v) the acceleration of the Loans and
termination of the Commitments under any of the DIP Facility,
including, without limitation, as a result of the occurrence and
continuance of an Event of Default (any such occurrence, the
Maturity Date); provided, however, that the Maturity Date will
occur in any event no later than 30 months from the Closing Date.
Any plan of reorganization or liquidation or confirmation order
entered in the Cases shall not discharge or otherwise affect in any way
any of the joint and several obligations of the Debtors to the Lenders
under the DIP Facility and the Loan Documents, other than after the
payment in full and in cash, to the Lenders of all obligations (other
than indemnities and other contingent obligations not then due and
payable) under the DIP Facility and the Loan Documents on or before
the effective date of a plan of reorganization and the termination of the
Commitments.
Closing Date: The date on which the initial portion of the Commitments are made
available for borrowings under the DIP Facility (the Closing Date),

8

which shall be no later than five (5) business days after the Final
Order Entry Date, subject to satisfaction (or waiver) of the applicable
conditions precedent set forth herein.
Amortization: None. For the avoidance of doubt, there will be neither an excess cash
flow sweep nor scheduled amortization under the DIP Facility.
Interest Rate and Fees: As set forth on Annex II.
Borrowing Procedure: The Term Facility will be available in a single draw on or after the
date the Final Order is entered. For the avoidance of doubt, the
Borrower shall not be required to draw the full amount of the Term
Commitments.
Borrowing requests under the DIP Facility shall be made (i) on three
business days notice, in the case of Loans bearing interest at a rate
based on LIBOR (LIBOR Loans) and (ii) on one business days
notice, in the case of Loans bearing interest based on the Alternate
Base Rate (ABR Loans).
Currency: Borrowings will be made in U.S. Dollars. All payments under the DIP
Facility will be made without setoff or counterclaim.
Voluntary Prepayments and
Commitment Reductions:
To be consistent with the Documentation Principles:
The Borrower may repay outstanding Term Loans and/or reduce the
Term Commitments at any time without premium or penalty,
including without any make-whole premium, (other than breakage
costs, if applicable on the amount of the prepayment or reduction)
upon (i) at least three (3) business days notice in the case of LIBOR
Loans and (ii) one business days notice in the case of ABR Loans;
provided that in the case of repayment, each partial repayment shall be
in an amount of $5,000,000 or multiples of $1,000,000 in excess
thereof (or, if less, the outstanding amount of applicable Term Loans),
and, each partial reduction shall be in an amount of $5,000,000 or
multiples of $1,000,000 in excess thereof (or, if less, the remaining
available balance of the relevant Commitment).
Mandatory Prepayments: The following mandatory prepayments shall be required, subject, in
each case, to reinvestment rights, exceptions and mechanics consistent
with the Documentation Principles:

1. Asset Sales: Prepayments of the DIP Facility in an amount equal
to 100% of (i) the net cash proceeds of the sale or other disposition
by the Oncor Entities (or successors thereof) of assets outside the
ordinary course that have been actually distributed to the Borrower
and (ii) the net cash proceeds of the sale or other disposition by the
Debtors of any property or assets (other than any such proceeds
received prior to the date of commencement of the Cases) of the
Debtors, other than net cash proceeds of sales or other dispositions
of power, capacity, energy, ancillary services and other products,

9

inventory and services or contracts related to any of the foregoing
(in each case, whether in physical, financial or other form), any
dispositions between the Debtors, any dispositions consisting of
leases and sub-leases and any other sales or dispositions in the
ordinary course of business or consistent with past practice, and
subject, in each case of clauses (i) and (ii), to any exceptions to be
mutually agreed on in the Loan Documents consistent with the
2. Insurance Proceeds: Prepayments of the DIP Facility in an amount
equal to 100% of the net cash proceeds of insurance paid on
account of any loss of any property or assets of the Debtors (other
than any such proceeds received prior to the date of
commencement of the Cases), with restrictions to be mutually
agreed, and subject to exceptions to be mutually agreed on in the
Loan Documents consistent with the Documentation Principles.
Priority/Security: All obligations of the Debtors to the Agent and the Lenders (such
persons, collectively, the DIP Secured Parties) under the Loan
Documents (the Obligations), including all Loans made under the
DIP Facility, shall, subject to the Carve-Out (defined below), at all
times:
(i) pursuant to Bankruptcy Code section 364(c)(1), be entitled to joint
and several superpriority administrative expense claim status in
the Cases, on a pari passu basis;
(ii) pursuant to Bankruptcy Code section 364(c)(2), be secured by the
following:
a perfected first-priority lien on substantially all now owned or
hereafter acquired assets of the Debtors and the proceeds
thereof, and a perfected lien on such assets in each case to the
extent such assets constitute Collateral (including the
Security Collateral (including the Equity Interests in Oncor
Electric Delivery Holdings Company LLC) and the Account
Collateral, as each such term is defined in the Pledge
Agreement dated as of November 16, 2009 (as amended,
amended and restated, supplemented or otherwise in effect
from time to time) between EFIH, the other Pledgors party
thereto, and the Bank of New York Mellon Trust Company
N.A. as collateral trustee) for purposes of the Collateral Trust
Agreement dated as of November 16, 2009 (as amended,
amended and restated, supplemented, modified or otherwise in
effect from time to time, the EFIH Collateral Trust
Agreement) among EFIH, The Bank of New York Mellon
Trust Company, N.A. as First Lien Trustee, the other Secured
Debt Representatives from time to time party thereto, and The
Bank of New York Mellon Trust Company N.A. as Collateral
Trustee (to be defined consistent with the Documentation
Principles) the (Collateral); provided, however, that the

10

Collateral will not secure any actual or purported Obligation
(including pursuant to any guarantee or grant of security) with
respect to any swap (as defined under the Commodity
Exchange Act) (after giving effect to keepwell agreements in
the Loan Documents) entered into by the Borrower or any
Guarantor thereof that is not an eligible contract participant
(as such term is defined in the Commodity Exchange Act) at
the time such swap Obligation is incurred, or in the case of
an Obligation resulting from a guarantee (or grant of security)
at the later of the time such guarantee (or grant of security) is
entered into and the time such swap obligation being
guaranteed (or secured) is incurred; provided, further that the
Collateral shall exclude the Debtors claims and causes of
action under Chapter 5 of the Bankruptcy Code, or any other
avoidance actions under the Bankruptcy Code (collectively,
the Avoidance Actions), but subject only to, and effective
upon, entry of the Final Order, shall include any proceeds or
property recovered, unencumbered or otherwise the subject of
successful Avoidance Actions, whether by judgment,
settlement or otherwise. For the avoidance of doubt,
Collateral will also exclude the following: (a) those assets
over which the granting of security interests in such assets
would be prohibited by contract (other than any in respect of
any of the Prepetition Facilities), applicable law or regulation
or the organizational documents of any non-wholly owned
subsidiary (including permitted liens, leases and licenses), or
to the extent that such security interests would result in
adverse tax or accounting consequences as determined in good
faith by the Borrower, (b) those assets as to which the
Administrative Agent and the Borrower reasonably determine
that the cost of obtaining such a security interest or perfection
thereof are excessive in relation to the benefit for the Lenders
of the security to be afforded thereby, (c) assets in respect of
which the granting or perfection of a lien would violate any
applicable law or regulation (including regulations adopted by
FERC, the Public Utility Commission of Texas and/or the
Nuclear Regulatory Commission), and (d) other exceptions (i)
to be mutually agreed or (ii) that are usual and customary for
facilities of this type for affiliates of the Borrower will not
constitute Collateral; provided, however, notwithstanding
anything to the contrary contained herein, to the extent the
security interest in such Collateral may be perfected by the
entry of the Final Order, neither the Borrower nor any
Guarantor shall be required to obtain, provide or execute any
mortgage or control agreement in favor of the Agent or any
other DIP Secured Party with regard to any Collateral nor
shall the Borrower or any Guarantor be required to obtain a
certificate of title evidencing the security interest of the Agent
or any other Secured Party with respect to any Collateral;
in each case, to the extent that such Collateral is not subject to valid,

11

perfected and non-avoidable liens as of the commencement of the
Cases;
(iii) pursuant to Bankruptcy Code section 364(c)(3), be secured by the
following:
a perfected lien on all Collateral;
avoidable liens in favor of third parties in existence at the time of the
commencement of the Cases or to valid liens in existence at the time
of such commencement that are perfected subsequent to such
commencement as permitted by Section 546(b) of the Bankruptcy
Code (other than property that is subject to the existing liens that
secure the obligations under any of the Existing Primed Secured
Facilities referred to below, which liens shall be primed by the liens
securing the DIP Facility described in such clause, subject to such
liens in favor of such third parties); and
(iv) pursuant to Bankruptcy Code section 364(d), be secured by the
following:
a perfected priming first-priority lien on all Collateral, and
avoidable liens in favor of third parties as of the commencement of the
Cases that secure the obligations of the Borrower and the Guarantors
under or in connection with each of the Prepetition Facilities that are
secured (collectively the Existing Primed Secured Facilities);
subject, in each case, to the Carve Out.
All liens securing the Obligations, the 507(b) Claim (as defined
below) and any and all forms of adequate protection, liens or claims
securing the Obligations and other prepetition obligations, including
the liens and security interests granted to the respective noteholders
and other secured parties pursuant to and in connection with the
Existing Primed Secured Facilities (the Existing Primed Creditors)
(including all security agreements, mortgages, pledge agreements, and
other security documents executed by any of the Debtors in favor of
the agents under the Existing Primed Secured Facilities, for its benefit
and for the benefit of any secured party under the Existing Primed
Secured Facilities), shall be subject and subordinate to the Carve Out.
The Carve Out means the sum of (i) all fees required to be paid to
the Clerk of the Bankruptcy Court and to the Office of the United
States Trustee under section 1930(a) of title 28 of the United States
Code plus interest at the statutory rate (without regard to the notice set
forth in (iii) below); (ii) fees and expenses up to $50,000 incurred by a
trustee under section 726(b) of the Bankruptcy Code (without regard
to the notice set forth in (iii) below); (iii) to the extent allowed at any

12

time, whether by interim order, procedural order or otherwise, all
unpaid fees and expenses (the Professional Fees) incurred by
persons or firms (Debtor Professionals) retained by the Debtors
pursuant to section 327, 328 or 363 of the Bankruptcy Code and any
official committee of unsecured creditors (the Committee and,
together with the Debtor Professionals, the Professional Persons)
appointed in the Cases pursuant to section 1103 of the Bankruptcy
Code at any time before or on the first Business Day following
delivery by the Agent of a Carve Out Trigger Notice (defined below),
whether allowed by the Bankruptcy Court prior to or after delivery of
a Carve Out Trigger Notice; and (iv) Professional Fees of Professional
Persons in an aggregate amount not to exceed $25,000,000 incurred
after the first Business Day following delivery by the Agent of the
Carve Out Trigger Notice, to the extent allowed at any time, whether
by interim order, procedural order or otherwise (the amounts set forth
in this clause (iv) being the Post-Carve Out Trigger Notice Cap).
For purposes of the foregoing, Carve Out Trigger Notice shall
mean a written notice delivered by email (or other electronic means)
by the Agent to the Debtors, their lead restructuring counsel, the
United States Trustee, and lead counsel to the Committee, which
notice may be delivered following the occurrence and during the
continuation of an Event of Default and acceleration of the Obligations
under the DIP Facility, stating that the Post-Carve Out Trigger Notice
Cap has been invoked.
On the day on which a Carve Out Trigger Notice is given by the Agent
to the Debtors, the Carve Out Trigger Notice shall constitute a demand
to the Debtors to utilize all cash on hand as of such date and any
available cash thereafter held by any Debtor to fund a reserve in an
amount equal to the then unpaid amounts of the Professional Fees.
The Debtors shall deposit and hold such amounts in a segregated
account at the Agent in trust to pay such then unpaid Professional Fees
(the Pre-Carve Out Trigger Notice Reserve) prior to any and all
other claims. The Debtors shall deposit and hold such amounts in a
segregated account at Agent in trust to pay such Professional Fees
benefiting from the Post-Carve Out Trigger Notice Cap (the
Post-Carve Out Trigger Notice Reserve and, together with the
Pre-Carve Out Trigger Notice Reserve, the Carve Out Reserves)
prior to any and all other claims. All funds in the Pre-Carve Out
Trigger Notice Reserve shall be used first to pay the obligations set
forth in clauses (ii) through (iii) of the definition of Carve Out set forth
above, but not, for the avoidance of doubt, the Post-Carve Out Trigger
Notice Cap, until paid in full, and then, to the extent the Pre-Carve Out
Trigger Notice Reserve has not been reduced to zero, to pay the Agent
for the benefit of the Lenders, unless the Obligations have been paid in
full, in which case any such excess shall be paid to the lenders under
the Existing Primed Secured Facilities in accordance with their rights
and priorities as of the Petition Date. All funds in the Post-Carve Out
Trigger Notice Reserve shall be used first to pay the obligations set
forth in clause (iv) of the definition of Carve Out set forth above, and
then, to the extent the Post-Carve Out Trigger Notice Reserve has not

13

been reduced to zero, to pay the Agent for the benefit of the Lenders,
unless the Obligations have been paid in full, in which case any such
excess shall be paid to the lenders under the Existing Primed Secured
Facilities in accordance with their rights and priorities as of the
Petition Date.
Notwithstanding anything to the contrary in the Loan Documents, the
Final Order, following delivery of a Carve Out Trigger Notice, the
Agent and the agents under the Existing Primed Secured Facilities
shall not sweep or foreclose on cash (including cash received as a
result of the sale or other disposition of any assets) of the Debtors until
the Carve Out Reserves have been fully funded, but shall have a
security interest in any residual interest in the Carve Out Reserves,
with any excess paid to the Agent for application in accordance with
the Loan Documents.
Further, notwithstanding anything to the contrary herein,
(i) disbursements by the Debtors from the Carve Out Reserves shall
not constitute Loans or increase or reduce the Obligations, (ii) the
failure of the Carve Out Reserves to satisfy in full the Professional
Fees shall not affect the priority of the Carve Out and (iii) in no way
shall the Carve Out, Post-Carve Out Trigger Notice Cap, Carve Out
Reserves, or any of the foregoing be construed as a cap or limitation
on the amount of the Professional Fees due and payable by the
Debtors. The Debtors shall not assert or prosecute, and no portion of
the proceeds of the DIP Facility, the Collateral, or the Carve Out, and
no disbursements set forth in the Budget, shall be used for the payment
of professional fees, disbursements, costs or expenses incurred by any
person in connection with (a) preventing, hindering or delaying any of
the Agents or the Lenders enforcement or realization upon any of the
Collateral once an Event of Default has occurred and is continuing and
after the Remedies Notice Period, (b) objecting or challenging or
contesting in any manner, or raising any defenses to, the validity,
extent, amount, perfection, priority, or enforceability of any of the
Obligations, the liens securing the DIP Facility, or any other rights or
interest of any of the Agent or the Lenders, or (c) asserting,
commencing or prosecuting any claims or causes of action, including,
without limitation, any actions under Chapter 5 of the Bankruptcy
Code, against the Agent, any Lender or any of their respective
affiliates, agents, attorneys, advisors, professionals, officers, directors
and employees.
The liens on the Collateral securing the Existing Primed Secured
Facilities shall be junior and subordinate to the Carve Out and the liens
securing the DIP Facility. All of the liens described herein shall be
effective and perfected as of the Final Order Entry Date and without
the necessity of the execution of mortgages, security agreements,
pledge agreements, financing statements or other agreements.

Representations and Each of the Debtors under the DIP Facility will make only the

14

Warranties: following representations and warranties, consistent with the
Documentation Principles and (for the avoidance of doubt) each as
modified as necessary to reflect the commencement of the Cases and
events leading up to and following commencement:
Financial statements; no Material Adverse Event since the Petition
Date; existence and good standing, authorization and validity;
compliance with law; corporate power and authority; due
authorization, execution, delivery and enforceability of Loan
Documents; no conflict with law, organizational documents, unstayed
orders and decrees or post-petition material contractual obligations; no
material unstayed litigation; no default; ownership of property;
intellectual property; taxes; insurance; Federal Reserve regulations;
ERISA; Investment Company Act; subsidiaries; environmental
matters; labor matters; OFAC; FCPA; Patriot Act; anti-terrorism laws
and anti-money laundering laws; effectiveness of the Final Order;
creation, validity, perfection and priority of lien securing the DIP
Facility; and accuracy of disclosure. Notwithstanding anything in this
Term Sheet or any Loan Document to the contrary, the Debtors will
not provide any representation or warranty concerning solvency.
As used herein and in the Loan Documents, a Material Adverse
Event shall mean any circumstance or conditions affecting the
business, assets, operations, properties or financial condition of the
Borrower and its subsidiaries taken as a whole, that would individually
or in the aggregate, materially adversely affect the ability of the
Debtors (taken as a whole) to perform their payment obligations under
the Loan Documents to which they are a party, or the rights and
remedies of the Agent and the Lenders under the Loan Documents
(other than, in each case, as a result of the events leading up to, and
following commencement of a proceeding under Chapter 11 of the
Bankruptcy Code and the continuation and prosecution thereof,
including circumstances or conditions resulting from, or incidental to,
such events, commencement, continuation and prosecution, which
shall not individually or in the aggregate constitute a Material Adverse
Event), and provided that nothing disclosed in any of the following
filings by EFIH and/or EFH (1) the Annual Report on Form 10-K for
the year ended December 31, 2013, as filed on the date of the
Commitment Letter (to the extent substantially the same in form and
substance as the version provided to the Left Lead DIP Facility
Arranger at least 2 days prior to the date of the Commitment Letter),
(2) any filings on Form 8-K made through the date of the Commitment
Letter and/or (3) any disclosure statement related to any plan of
reorganization or liquidation of Debtors provided to the J oint Lead
Arrangers on or prior to the date of the Commitment Letter, shall, in
any case, in and of itself and based solely on facts as disclosed therein
(without giving effect to any developments not disclosed therein)
constitute a Material Adverse Event.
Covenants:

15

- Affirmative
Covenants:
Each of the Debtors under each of the DIP Facility (solely with respect
agree only to the following affirmative covenants (consistent with, in
each case, the Documentation Principles):
(a) delivery of (i) periodic updates of the Budget and monthly
variance reports (as described above) and (ii) quarterly and
annual financial statements;
(b) delivery of monthly reports with respect to asset sales, cost
savings, and other matters reasonably requested by the Agent;
(c) delivery to the Agent and its legal counsel, at least 2 business
days in advance of filing with the Bankruptcy Court, of all
proposed first day pleadings and proposed orders, which
must be in form and substance reasonably satisfactory to the
Agent (but in the case of the order governing cash
management and any order governing adequate protection,
shall be satisfactory in form and substance to the Agent);
(d) delivery to the Agent and its legal counsel, as soon as
practicable in advance of filing with the Bankruptcy Court, of
any plan or reorganization or liquidation and/or any disclosure
statement related to such plan, which must be in form and
substance reasonably satisfactory to the Agent; provided,
however, that with respect to provisions of the plan of
reorganization and/or any disclosure statement that relate to
payment of the DIP Facility, such provisions must be in form
and substance satisfactory to the Agent;
(e) delivery to the Agent as soon as practicable in advance of
filing with the Bankruptcy Court of the Final Order (which
must be in form and substance satisfactory to the Agent) and
all other proposed material orders and pleadings related to the
DIP Facility (which must be in form and substance reasonably
satisfactory to the Agent), any plan of reorganization or
liquidation, and/or any disclosure statement related to such
plan;
(f) file with the Bankruptcy Court a plan of reorganization and a
disclosure statement relating thereto, each in form and
substance reasonably satisfactory to the Agent, within 18
months after the Petition Date; provided, however, that with
respect to provisions of the plan of reorganization and/or any
disclosure statement that relate to payment of the DIP Facility,
such provisions must be in form and substance satisfactory to
the Agent;
(g) maintenance of cash management system in accordance with
the orders entered in the Cases, which orders shall be in form
and substance satisfactory to the Agent; and the Borrower

16

shall maintain its own bank accounts and not otherwise
commingle cash with Energy Future Holdings Corp. or any of
Energy Future Holdings Corp.s other subsidiaries other than
subsidiaries of the Borrower;
(h) contest, if requested by the Agent, any motion seeking entry of
an order, and entry of an order, that is materially adverse to
the interests of the Agent or the Lenders or their respective
material rights and remedies under the DIP Facility in any of
the Cases;
(i) additional reporting requirements reasonably requested by the
Agent, including, without limitation, with respect to litigation,
contingent liabilities, Defaults, ERISA, environmental
liabilities and Material Adverse Events;
(j) reasonable access to information (including historical
information) and personnel (during normal business hours),
including, regularly scheduled meetings as mutually agreed
with senior management of the Borrower and other company
advisors (during normal business hours), and a subset of the
Agent shall be provided with access to all information it shall
reasonably request and to other internal meetings regarding
strategic planning, cash and liquidity management, operational
and restructuring activities;
(k) if not already obtained, commercially reasonable efforts to
obtain ratings from each of Moodys and Standard & Poors as
soon as reasonably practicable following the Closing Date;
and
(l) only such additional affirmative covenants (as modified to
account for the commencement and continuance of the Cases
and other express provisions in this Term Sheet) as are
consistent with the Documentation Principles.
- Negative Covenants: Each of the Debtors under each of the DIP Facility (solely with respect
agree only to the following negative covenants, consistent with, in
each case, the Documentation Principles:
(a) prohibition on creating or permitting to exist any liens on any
assets, other than liens securing the DIP Facility and any
permitted liens consistent with the Documentation Principles
(which liens shall include, among others, scheduled liens in
existence on the Closing Date) and other liens described in
Priority/Security above;
(b) prohibition on creating or permitting to exist any other
superpriority claim that is pari passu with or senior to the
claims of the Lenders under the DIP Facility, except for the

17

Carve-Out and liens securing the Obligations;
(c) prohibition on making adequate protection payments to, or
otherwise providing adequate protection for, creditors under
any of the Prepetition Facilities other than as provided for in
this Term Sheet and contained in the Final Order and/or any
cash collateral order approved by the Agent;
(d) prohibition on the use of proceeds of the DIP Facility for
purposes other than those described in this Term Sheet and
contained in the Final Order;
(e) limitations on disposing of assets (including, without
limitation, any sale and leaseback transaction and any
disposition under Bankruptcy Code section 363);
(f) prohibition on modifying or altering in any material manner
the nature and type of its business (taken as a whole) except as
required by the Bankruptcy Code or orders entered by the
Bankruptcy Court;
(g) prohibition on prepaying prepetition Indebtedness, except as
expressly provided for in the Loan Documents or pursuant to
first day or other orders entered by the Bankruptcy Court
upon pleadings in form and substance reasonably satisfactory
to the Agent;
(h) prohibition on consenting to the termination or reduction of
the Debtors exclusive plan filing and plan solicitation periods
under section 1121 of the Bankruptcy Code (the Exclusivity
Periods) or failing to object to any motion by a party in
interest (other than a Lender or the Agent) seeking to
terminate or reduce the Exclusivity Periods, in each case
without the prior written consent of the Agent; and
(i) such additional negative covenants (as modified to account for
the commencement of the Cases and other express provisions
in this Term Sheet or the Commitment Letter) as are
consistent with the Documentation Principles.
It is understood that transactions (including any payments to
affiliates) under the ordinary course cash management system,
including pursuant to any shared services or similar agreement
(Shared Services Agreement) and any tax sharing
agreements (Tax Sharing Agreements), any sublease of
property from any Specified Affiliate to the Borrower or any
of its restricted subsidiaries (Property Subleases) and
certain other agreements or arrangements to be agreed to, each
as in effect on the date of the Commitment Letter (and as
amended, supplemented or modified in a manner that is not
materially adverse to the interests of the Lenders in their

18

capacity as such) and/or contemplated in the Initial Budget or
any other Budget that has been approved by the Agent from
time to time (if any) in respect of any applicable period will in
any event be permitted by the Loan Documents (as and when
the Borrower and/or Guarantors elect to make such
performance in their respective discretion); provided, further
that failure to comply with any such agreements shall not
constitute a Default or Event of Default under the Loan
Documents.
The DIP Facility will include exceptions from the relevant
covenants allowing for investments and/or restricted payments
(in the form of intercompany loans, intercompany funding or
otherwise) and transactions with affiliates between the
Borrower, any of its subsidiaries, and the Specified Affiliates
pursuant to which the Borrower may (in its discretion)
perform intercompany transactions under the ordinary course
cash management system (including pursuant to the Shared
Services Agreement, any Tax Sharing Agreements, or
Property Sublease and certain other agreements or
arrangements to be agreed to) to, the Specified Affiliates, to
finance general corporate purposes of the Specified Affiliates
during the pendency of the Cases.
Specified Affiliates means, collectively, the following affiliates of
the Borrower: EFH Corporate Services Company and Energy Future
Holdings Corp.
- Financial Covenants: Minimum liquidity (to be defined as unrestricted cash) of $150 million
at all times.
Events of Default: The occurrence and continuance of any of the following events shall
constitute an Event of Default under the DIP Facility (consistent, in
(a) (i) the Final Order Entry Date shall not have occurred on or
prior to the date that is one hundred and ten (110) days after
the date of the Commitment Letter or (ii) the Term Facility
shall not have been funded in full within ten (10) days of the
Final Order Entry Date;
(b) Any of the Cases shall be dismissed or converted to a Chapter
7 Case;
(c) A trustee, receiver, interim receiver, receiver or manager shall
be appointed in any of the Cases, or a responsible officer or an
examiner with enlarged powers shall be appointed in any of
the Cases (having powers beyond those set forth in
Bankruptcy Code sections 1106(a)(3) and (4));
(d) Any other superpriority administrative expense claim or lien

19

(other than the Carve-Out) which is pari passu with or senior
to the claims or liens of the Agent or the Lenders under the
DIP Facility shall be granted in any of the Cases without the
prior written consent of the Agent;
(e) The Bankruptcy Court shall enter an order granting relief from
the automatic stay to (i) any creditor or party in interest to
permit foreclosure (or the granting of a deed in lieu of
foreclosure or the like) on any equity interest in any of the
Oncor Entities held by any of the Debtors or (ii) any creditor
or party in interest with a value in excess of $25,000,000 to
permit foreclosure (or the granting of a deed in lieu of
foreclosure or the like) on any assets of the Debtors (other
than assets described in clause (i)) that have an aggregate
value in excess of $25,000,000;
(f) The Borrower shall default in the payment of (i) principal on
the Loans when due; or (ii) interest or fees and such default
shall continue for more than five (5) days;
(g) Any representation or warranty made or deemed made by any
Debtor in any Loan Document shall prove untrue in any
material respect on the date as of which it is made or deemed
made;
(h) The Debtors shall default (i) in the observance of any negative
covenant (and certain specified affirmative covenants
consistent with the Documentation Principles) in the Loan
Documents, (ii) in the observance of the Financial Covenant;
or (iii) in the observance of any other covenant, term or
condition not otherwise specified herein which default
continues for more than 30 days after receipt of notice to the
Borrower from the Agent or the Requisite Lenders (defined
below);
(i) An order shall be entered reversing, supplementing, or staying
for a period of five (5) business days or more, vacating or
otherwise modifying the Interim Fee Order or the Final Order
in a manner that is adverse to the interests of the Agent or the
Lenders, or any of the Debtors shall apply for authority to do
so, without the prior written consent of the Agent or the
Requisite Lenders, or the Interim Fee Order or the Final Order
with respect to the DIP Facility shall cease to be in full force
and effect;
(j) An order shall be entered amending in a manner that is
adverse in any material respect to the interests of the Lenders
the Interim Fee Order or the Final Order without the consent
of the Lenders;
(k) Any judgments that are in the aggregate in excess of

20

$25,000,000 as to any post-petition obligation that is allowed
as an administrative expense claim against the Debtors shall
be rendered against the Debtors and the enforcement thereof
shall not be stayed (by operation of law, the rules or orders of
a court with jurisdiction over the matter or by consent of the
party litigants, in each case, to the extent not paid or covered
by insurance provided by a carrier not disputing coverage) or
there shall be rendered against the Debtors a non-monetary
judgment with respect to a post-petition event that causes or is
reasonably expected to cause a Material Adverse Event;
(l) Any Debtor makes any material payments relating to
prepetition obligations (including any adequate protection
payments) other than in accordance with a first day order,
the Interim Fee Order, the Final Order, or as otherwise agreed
to by the Agent;
(m) A plan shall be confirmed in any of the Cases that does not
provide for termination of the Commitments under the DIP
Facility and the indefeasible payment in full in cash of the
Obligations (other than indemnities and other contingent
obligations not then due and payable) on the effective date of
such plan;
(n) The Final Order shall cease to create a valid and perfected lien
on the Collateral;
(o) (i) Any Debtor shall file a motion or pleading or commence a
proceeding that would reasonably be expected to result in a
material impairment of any of the Lenders material rights or
interests in their capacities as Lenders under the DIP Facility
or (ii) a determination by a court with respect to a motion,
pleading or proceeding brought by another party that results in
such an impairment;
(p) Any Loan Document or any material provision thereof shall
cease to be effective (other than in accordance with its terms);
(q) Any of the Debtors shall fail to comply with the Interim Fee
Order or the Final Order in any material respect;

(r) The Bankruptcy Court shall enter an order approving any
claims for recovery of amounts under section 506(c) of the
Bankruptcy Code or otherwise arising from the preservation of
any Collateral;
(s) The Bankruptcy Court shall enter a final non-appealable order
that is adverse in any material respect to the interests (when
taken as a whole) of the Agent or the Lenders or their
respective material rights and remedies in their capacity as
such under the DIP Facility in any of the Cases;

21

(t) The Borrower shall default on payment due or there shall be
any event of default the effect of which is to accelerate or
permit acceleration with respect to material indebtedness
(threshold to be agreed) incurred after the Petition Date
provided, that notwithstanding anything in the foregoing to the
contrary, this section shall not apply with respect of make-
whole payments or premiums in respect of indebtedness;
(u) The Loan Parties or any of their subsidiaries, or any person
claiming by or through the Loan Parties or any of their
subsidiaries, shall obtain court authorization to commence, or
shall commence, join in, assist or otherwise participate as an
adverse party in any suit or other proceeding against any of the
Agent or the Lenders in each case relating to the DIP Facility;
(v) Any Debtor shall file any pleading seeking, or otherwise
consenting to, or shall support or acquiesce in any other
persons motion as to any matter set forth in clause (a), (b),
(c), (d), (e), (i), (j), (k), (l), (m), (n), (o), (r), (s), or (u) above;
and
(w) Such additional events of default (as modified to account for
the commencement of the Cases and other express provisions
in this Term Sheet or the Commitment Letter]) as are
consistent with the Documentation Principles (with the change
of control definition to be agreed).
Notwithstanding anything to the contrary contained herein,
any Event of Default under the Loan Documents, and any or
similarly defined term under any Loan Document, other than
any Event of Default which cannot be waived without the
written consent of each Lender directly and adversely affected
thereby, shall be deemed not to be continuing if the events,
act or condition that gave rise to such Event of Default have
been remedied or cured (including by payment, notice, taking
of any action or omitting to take any action) or have ceased to
exist.
Upon the enforcement of remedies after acceleration of the
Loans as a result of an Event of Default, proceeds of other
Collateral will be paid: first, to holders of any then
outstanding obligations under the Carve Out (if any), up the
amount thereof; and then, to the holders of the Obligations.
Rights and Remedies Upon
Event of Default:
Upon the occurrence of an Event of Default and following the giving
of five calendar days notice to the Debtors (the Remedies Notice
Period), the Agent, on behalf of the Lenders, may (and at the
direction of the Requisite Lenders, shall) exercise all rights and
remedies provided for in the Loan Documents and may declare (i) the
termination, reduction or restriction of any further Commitment to the

22

extent any such Commitment remains, (ii) all Obligations to be
immediately due and payable, without presentment, demand, protest,
or other notice of any kind, all of which are expressly waived by the
Debtors, and (iii) the termination of the Loan Documents as to any
future liability or obligation of the Agent and the Lenders, but without
affecting any of the liens securing the DIP Facility or the Obligations.
During the Remedies Notice Period, the Debtors may continue to use
cash collateral in the ordinary course of business, consistent with past
practices and the most recently delivered Budget, but may not enter
into, or seek approval of, any transactions or arrangements (including,
without limitation, the incurrence of indebtedness or liens,
investments, restricted payments, asset sales or transactions with non-
Debtor affiliates) that are not in the ordinary course of business.
Unless the Bankruptcy Court orders otherwise during the Remedies
Notice Period, at the end of the Remedies Notice Period, the Debtors
shall no longer have the right to use or seek to use cash collateral, the
automatic stay pursuant to section 362 of the Bankruptcy Code shall
be automatically terminated without further notice to or order of the
Bankruptcy Court, and the Agent shall be permitted to exercise all
rights against the Collateral in accordance with the Loan Documents
and the Final Order, as applicable, and shall be permitted to satisfy
the Obligations, without further order or application or motion to the
Bankruptcy Court and without restriction or restraint by any stay under
section 362 or 105 of the Bankruptcy Code. Notwithstanding anything
herein to the contrary, the automatic stay pursuant to section 362 of
the Bankruptcy Code shall be automatically terminated for the
purposes of giving any notice contemplated hereunder.
During the Remedies Notice Period, any party in interest shall be
entitled to seek an emergency hearing with the Bankruptcy Court
solely for the purpose of contesting whether an Event of Default has
occurred and/or is continuing, and the Debtors waive their right to, and
shall not be entitled to seek relief, including without limitation, under
section 105 of the Bankruptcy Code, to the extent that such relief
would in any way impair or restrict the rights and remedies of the
Agent, on behalf of the Lenders, set forth in the Interim Fee Order, the
Final Order, or the Loan Documents.
The delay or failure to exercise rights and remedies under the Interim
Fee Order, the Final Order or the Loan Documents by the Agent, on
behalf of the Lenders, shall not constitute a waiver of such Agents
rights thereunder or otherwise, unless any such waiver is pursuant to a
written instrument executed in accordance with the terms of the
applicable Loan Documents.
Conditions to Full
Availability:
The obligation to provide Loans up to the full amount of the
Commitments shall be subject to the satisfaction or waiver of the
conditions precedent listed on Annex I attached hereto.
Assignments and Subject in each case to the Documentation Principles, each Lender

23

Participations: may assign all or any part of the Term Facility to one or more
affiliates, banks, financial institutions or other entities, in each case,
with the prior written consent of the Borrower (unless such an
assignment is being made to a Lender, an affiliate of a Lender, or an
approved fund of such Lender or its affiliate) and the Agent (unless
such an assignment is being made to a Lender, an affiliate of a Lender
or an approved fund of such Lender or its affiliate) (in each case, not
to be unreasonably withheld, conditioned or delayed); provided,
however, that under no circumstances will assignments be made to a
Disqualified Institution (defined below), and that the consent of the
Borrower will not be required during the continuance of an Event of
Default. Upon such assignment, such affiliate, bank, financial
institution or entity will become a Lender for all purposes under the
Loan Documents.
The Lenders will also have the right to sell participations (other than to
Disqualified Institutions), subject to customary limitations on voting
rights, in the DIP Facility.
Disqualified Institutions means (a) any company engaged
principally in the business of energy or power generation and/or
transmission as identified in writing to the Agent by the Company
from time to time, (b) any company whose principal business is that of
an energy or power merchant as identified in writing to the Agent by
the Company from time to time, (c) any financial institution identified
in writing to the J oint Lead Arrangers by the Borrower on or prior to
the date of the Commitment Letter (including any such persons
affiliates that are clearly identifiable on the basis of such affiliates
names) and (d) a defaulting Lender (as described below). The list of
Disqualified Institutions shall be posted for the benefit of the Lenders.
Upon the identification in writing by the Borrower to the Agent of any
additional Disqualified Institutions pursuant to clause (a) or (b) above,
the Agent shall promptly post such addition to the list to the Lenders;
provided that any additional person so identified shall not be deemed a
Disqualified Institution until such time as such addition to the list is
posted to the Lenders.
Requisite Lenders: Voting with respect to the DIP Facility will be done solely by the
Lenders. The vote of Lenders holding more than 50% of total
Commitments under the DIP Facility (or if no Commitments are
outstanding, total exposure) (the Requisite Lenders) shall be
required to amend, waive or modify any terms and conditions of the
DIP Facility (with customary exceptions consistent with the
Documentation Principles where only the consent of the relevant
Agent will be required), except that with respect to matters relating to,
among others, the reduction in, or compromise of payment rights with
respect to, principal or interest rates, extension of maturity (it being
understood and agreed that a waiver or amendment of the Extension
Conditions (other than the Extension Conditions set forth under
clauses (1) (solely with respect to a payment Event of Default) and (6)
of the definition thereof, which will be subject to the consent of each

24

Lender) will be subject to Requisite Lender consent) or scheduled date
of payment of any interest or fees due, release of material guarantees
and/or liens granted on all or substantially all of the Collateral (other
than guarantees, liens, or Collateral subject to permitted dispositions,
permitted mergers, consolidations, reorganizations, etc.) and reduction
in voting thresholds, the consent of the Lenders holding 100% of total
Commitments (or if no Commitments are outstanding, total exposure)
directly and adversely affected thereby will be required, except that the
Commitment of a Lender may not be increased without such Lenders
consent.
Defaulting Lenders: The Loan Documents will contain customary provisions (but
consistent in any event with the Documentation Principles) relating to
defaulting Lenders (including provisions relating to the suspension
of voting rights and rights to receive fees, and the termination or
assignment of Commitments and Loans held by defaulting Lenders
at par).
Taxes: Consistent in each case with the Documentation Principles, the Loan
Documents shall contain customary provisions (a) protecting the
Lenders against increased costs or loss of yield resulting from changes
in reserve, tax, capital adequacy and other requirements of law and
from the imposition of or changes in withholding or other taxes
(including in respect of Dodd-Frank and Basel III) and
(b) indemnifying the Lenders for breakage costs incurred in
connection with any prepayment of a LIBOR Loans on a day other
than the last day of an interest period with respect thereto.
In connection with any proposed amendment, waiver or other
modification to the DIP Facility (a Proposed Change) requiring the
consent of all Lenders or all directly and adversely affected Lenders, if
the consent to such Proposed Change of all Lenders whose consent is
required is not obtained, but the consent of Lenders with a majority of
the Loans held by the applicable group of Lenders is obtained (any
such Lender whose consent is required but is not obtained, a Non-
Consenting Lender), then the Borrower may, at its sole expense,
upon notice to such Non-Consenting Lender and the Agent, require
such Non-Consenting Lender to assign and delegate, without recourse
(in accordance with and subject to all restrictions otherwise applicable
to assignments), all its interests, rights and obligations under the DIP
Facility to an assignee that shall assume such obligations or terminate
such Non-Consenting Lenders commitments; provided that such Non-
Consenting Lender shall have received payment of an amount equal to
the outstanding principal of its Loans, accrued interest thereon,
accrued fees and all other amounts then due and owing to it under the
DIP Facility from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or the Borrower (in the case of
all other amounts).
Indemnity; Expenses: The Loan Documents will provide, in each case to the extent
consistent with the Documentation Principles, that the Borrower shall

25

indemnify, pay and hold harmless the Agent, the J oint Lead Arrangers,
and the Lenders and their affiliates (and their respective controlling
persons, directors, officers, partners, employees, agents, advisors and
other representatives (collectively the Related Parties)) (each, an
Indemnified Person) against any loss, claim, damage, liability, or
expense incurred in respect of the DIP Facility contemplated hereby or
the use of proceeds thereof or the Transactions or any claim, litigation,
investigation or proceeding (a Proceeding) relating to any of the
foregoing, regardless of whether any Indemnified Person is a party
thereto, whether or not such Proceedings are brought by any Debtor,
its equity holders, affiliates, creditors or any other person, and to
reimburse each Indemnified Person promptly following written
demand for any reasonable legal or other out-of-pocket expenses
incurred in connection with investigating or defending any of the
foregoing (except, in the case of any Indemnified Person, to the extent
resulting (i) from the gross negligence, bad faith or willful misconduct
of such Indemnified Person (or its Related Parties), in each case as
determined in a final non-appealable judgment of a court of competent
jurisdiction, (ii) from a dispute solely among Indemnified Persons
other than any claims against any Indemnified Person in its capacity or
in fulfilling its role as an Agent or J oint Lead Arranger or any similar
role under the DIP Facility and other than any claims arising out of
any act or omission on the part of the Borrower or the other Debtors or
(iii) from any material breach of the Loan Documents by such
Indemnified Person (or its Related Parties), as determined in a final
non-appealable judgment of a court of competent jurisdiction) and (b)
the Borrower shall reimburse within 10 days of written demand
(together with reasonably detailed supporting documentation) the
Agent, the Lenders and the J oint Lead Arrangers for their reasonable
and documented out-of-pocket expenses incurred in connection with
the negotiation, documentation, syndication and administration of the
DIP Facility, any amendments or waivers with respect thereto, any
Event of Default in respect of the DIP Facility and any exercise of
remedies in respect thereof (including reasonable and documented out-
of-pocket prepetition and post-petition fees, charges and
disbursements of legal counsel, financial advisors and third-party
appraisers and consultants advising the Agent incurred in connection
with the Agents participation in the Cases, limited in the case of legal
counsel to one primary counsel (and (i) appropriate local counsel in
applicable foreign and local jurisdictions, but limited to one local
counsel in each such jurisdiction, (ii) appropriate regulatory counsel
and (iii) solely in the case of a conflict of interest, one additional
counsel in each relevant jurisdiction to the affected indemnified
persons similarly situated)); provided, however, that the Debtors shall
promptly provide copies of invoices received on account of fees and
expenses of the professionals retained as provided for in the DIP
Documents to counsel to the Committee and the United States Trustee,
and the Bankruptcy Court shall have exclusive jurisdiction over any
objections raised to the invoiced amount of the fees and expenses
proposed to be paid, which objections may only be raised within ten
days after receipt thereof. In the event that within ten days from receipt

26

of such invoices the Debtors, the United States Trustee or counsel to
the Committee raise an objection to a particular invoice, and the
parties are unable to resolve any dispute regarding the fees and
expenses included in such invoice, the Bankruptcy Court shall hear
and determine such dispute; provided, that payment of invoices shall
not be delayed based on any such objections and the relevant
professional shall only be required to disgorge amounts objected to
upon being so ordered pursuant to a final order of the Bankruptcy
Court.
Governing Law and
Jurisdiction:
The Loan Documents will provide that the Debtors and the Lenders
will submit to the exclusive jurisdiction and venue of the Bankruptcy
Court, or in the event that the Bankruptcy Court does not have or does
not exercise jurisdiction, then in any state or federal court of
competent jurisdiction in the Southern District of New York and shall
waive any right to trial by jury. New York law shall govern the Loan
Documents.
Miscellaneous: The terms and conditions of the Interim Fee Order and Final Orders
(e.g. 506(c) waivers, marshaling, and successors and assigns) to be
mutually agreed.
Counsel to the Joint Lead
Arrangers and the Agent:

Shearman & Sterling LLP


27

Annex I
SUMMARY OF CONDITIONS PRECEDENT TO THE DIP FACILITY
1. Interim Fee Order/Final Order/Bankruptcy Matters.
(a) The Bankruptcy Court shall have entered, upon motion in form and substance satisfactory
to the Left Lead DIP Facility Arranger, an interim order in form and substance
satisfactory to the Left Lead DIP Facility Arranger (the Interim Fee Order) as to the
DIP Facility Fee, the Ticking Fee and the reimbursement of documented expenses of the
Commitment Parties (including fees, charges and disbursements of counsel), no later than
ten (10) business days after the date of commencement of the Cases, (a) approving and
authorizing the Debtors to satisfy such fees when due under, to the extent provided in,
and in accordance with the Commitment Letter and the Fee Letter; and (b) entitling such
fees to administrative expense priority pursuant to section 503(b) of the Bankruptcy Code
and ordering that such fees shall be deemed fully earned, indefeasibly paid, irrevocable,
and non-avoidable irrespective of whether the Term Loans are approved; provided,
however, that for the avoidance of doubt, the Borrower will not pay any amounts
authorized under the Interim Fee Order in advance of the Final Order Entry Date unless
pursuant to a separate Bankruptcy Court order authorizing the Borrower to use cash
collateral.
(b) No later than the date that is one hundred and ten (110) days after the date of the
Commitment Letter, a final order shall have been entered by the Bankruptcy Court in
form and substance satisfactory to the Left Lead DIP Facility Arranger (which shall in
any case approve the entirety of the Term Facility and the repayment and/or settlement
(including via an exchange) in full of the principal amount plus any accrued and unpaid
interest of the EFIH First Lien Secured Notes with the proceeds of the Term Loans and
Incremental Term Loans) (the Final Order) on a motion by the Debtors that is in form
and substance satisfactory to the Left Lead DIP Facility Arranger, approving and
authorizing on a final basis the matters and containing the other provisions described in
this Section 1.
(c) Neither of the Interim Fee Order nor the Final Order shall have been reversed, modified,
amended, stayed or vacated, in the case of any modification or amendment, in a manner,
that is adverse to the Lenders, without the consent of the Left Lead DIP Facility
Arranger.
(d) The Final Order shall be in full force and effect and shall not have been reversed,
modified, amended, stayed or vacated, and with respect to any modification or
amendment, in a manner that is adverse to the Lenders without the consent of the Left
Lead DIP Facility Arranger.
(e) The Debtors shall be in compliance in all material respects with the Interim Fee Order
and the Final Order.
(f) The Cases shall have been commenced in the Bankruptcy Court and all of the first day

28

or shortly thereafter shall have been reviewed in advance by the Left Lead DIP Facility
Arranger and shall be reasonably satisfactory in form and substance to the Left Lead DIP
Facility Arranger, but in the case of orders relating to cash management and adequate
protection, shall be satisfactory in form and substance to the Left Lead DIP Facility
Arranger.
(g) No trustee or examiner with enlarged powers (having powers beyond those set forth in
2. Financial Statements, Budgets and Reports.
(a) The Borrower shall have delivered the Budget to the Agent and the Lenders, which shall
be in form and substance reasonably satisfactory to the Agent and the Joint Lead
Arrangers, and the Agent and the J oint Lead Arrangers hereby confirm the receipt of the
Budget dated April 28, 2014 in form and substance reasonably satisfactory to the Agent
and the J oint Lead Arrangers prior to the date hereof.
(b) The Borrower shall have delivered to the Agent and the Lenders a base case model,
including a statement of cash sources and uses of all free cash flow for the tenor of the
DIP Facility, which shall be in form and substance reasonably satisfactory to the Agent
and the J oint Lead Arrangers, and the Agent and the J oint Lead Arrangers hereby confirm
the receipt of a base case model dated April 28, 2014 in form and substance reasonably
satisfactory to the J oint Lead Arrangers and the Lenders prior to the date hereof.
(c) The Agent and the Lenders shall have received reasonably requested financial
information.
and other compensation contemplated by the Loan Documents and the Fee Letter to be
payable to the Commitment Parties, the Agent and the Lenders in respect of the DIP
Facility shall have been paid to the extent earned, due and payable.
Material Adverse Event).
(c) No Default or Event of Default shall exist under the DIP Facility.
4. Customary Closing Documents.
(a) The Debtors shall have complied with the following closing conditions: (i) the delivery of
customary legal opinions as to authority, authorization, execution and delivery; corporate
records and documents from public officials, including good standing certificates;
officers certificates; and notice of borrowing; (ii) evidence of authority; and
(iii) obtaining of any governmental consents, if any, necessary in connection with the DIP
Facility, the financing thereunder and related transactions. The Lenders shall have
received at least five (5) days prior to the Closing Date all documentation and other

29

information required by bank regulatory authorities under applicable know-your-
customer and anti-money laundering rules and regulations, including the Patriot Act.
(b) The Loan Documents (which shall be consistent with the Documentation Principles) shall
have been entered into by the Debtors, the Agent and the Lenders.
(c) The Agent shall have received results of a Uniform Commercial Code search for the
jurisdiction of organization of the Debtors and a federal tax lien search for the jurisdiction
of the chief executive office of the Debtors.
(d) The Agent shall have received proper financing statements (Form UCC-1 or the
equivalent) for filing under the UCC in the jurisdiction of organization of each Debtor.
the Final Order.
(a) If the Final Order (or any order entered concurrently or prior to the entry of the Final
Order) approves the repayment in full of the EFIH First Lien Secured Notes with the
proceeds of the Term Facility, substantially concurrently with the borrowing under the
Term Facility, the principal amount plus any accrued and unpaid interest of the EFIH
First Lien Secured Notes (which, for the avoidance of doubt, shall not include make-
whole payments or premiums in respect of the EFIH First Lien Secured Notes unless
otherwise approved by the Borrower) shall be repaid in full.


Annex II
INTEREST AND CERTAIN FEES

Interest Rate Options: The Borrower may elect that the loans comprising each borrowing bear
interest at a rate per annum equal to (a) the Alternate Base Rate (such
loans herein referred to as ABR Loans) plus the Applicable Margin
or (b) the Adjusted LIBO Rate (such loans herein referred to as
Eurodollar Loans) plus the Applicable Margin.
As used herein:
Alternate Base Rate or ABR means the greatest of (a) the prime
rate of interest announced from time to time by the Agent, changing
when and as said prime rate changes (the Prime Rate), (b) the federal
funds effective rate from time to time plus 0.50% and (c) the Adjusted
LIBO Rate (after giving effect to LIBO floor in the case of Term Loans)
for a one month interest period appearing on the Reuters Page LIBOR01
(or on any successor or substitute page) on such day plus 1.00%.
Adjusted LIBO Rate means the rate (adjusted for statutory reserve
requirements for eurocurrency liabilities) for eurodollar deposits for a
period equal to one or two weeks, one, two, three or six months (as
selected by the Borrower) appearing on Reuters Page LIBOR01 (or on
any other service providing comparable rate quotations) at
approximately 11:00 a.m., London time, two business days prior to the
first day of the applicable interest period; provided that in the case of
Term Loans, the Adjusted LIBO Rate shall be subject to a floor (the
LIBO Floor) of 1.00% per annum.
Applicable Margin means, a margin of:
2.25%, in the case of ABR Loans
3.25%, in the case of Eurodollar Loans
Interest Payment Dates: In the case of ABR Loans, interest shall be payable in arrears on the
first day of each month, upon any prepayment due to acceleration and at
the Maturity Date.
In the case of Eurodollar Loans, interest shall be payable in arrears on
the last day of each interest period and, in the case of an interest period
longer than three months, quarterly, upon any prepayment and at the
Maturity Date.
Agent and Joint Lead
Arrangers Fees:
Such additional fees payable to the Agent and the J oint Lead Arrangers
as are specified in the fee letter, dated April 28, 2014 (the Fee
Letter), by and among the Agent, the J oint Lead Arrangers and the
Borrower.

31
Default Rate: After any payment Event of Default and upon notice by the Agent, the
applicable interest rate for all Loans will be increased to, and overdue
interest, fees and other amounts (other than overdue principal) shall bear
interest at 2% per annum above the applicable rate. Overdue principal
shall bear interest at 2% above the rate otherwise applicable.
Rate and Fee Basis: All per annum rates shall be calculated on the basis of a year of 360
days (or 365/366 days, in the case of ABR Loans) for actual days
elapsed


Schedule 1

Clear Market Permitted Indebtedness

1. Indebtedness pursuant to the J unior Incremental Facility.
2. The exchange or other roll of the holders of your prepetition indebtedness pursuant to any Exchange
Arrangement.
3. Any Backstop Commitment sought or achieved prior to the date that is sixteen (16) business days after
the date you countersign this Commitment Letter.

EXHIBIT H

EFIH SECOND LIEN DIP FINANCING TERM SHEET


Execution Version

ENERGY FUTURE INTERMEDIATE HOLDING COMPANY LLC

SECOND LIEN SUBORDINATED SECURED DEBTOR IN POSSESSION NOTES FACILITY TERM SHEET
Capitalized terms used but not defined herein shall have the meanings set forth in the
letter agreement, dated as of April 29, 2014 (the Commitment Letter), to which this Term Sheet
is attached, or the Restructuring Support Agreement (as defined in the Commitment Letter).
Issuers Energy Future Intermediate Holding Company LLC, a
Delaware limited liability company (EFIH), and EFIH
Finance Inc., a Delaware corporation (collectively, the
Issuers).
Guarantors All of the Issuers direct and indirect domestic restricted
subsidiaries that guarantee the EFIH First Lien DIP Financing
(collectively, the Guarantors) in the Chapter 11 Cases. The
Issuers and the Guarantors are referred to herein as Note
Parties and each, a Note Party. All obligations of the
Issuers under the Second Lien DIP Facility (as defined below)
will be unconditionally guaranteed by the Guarantors.
Backstop Commitment To be provided by the entities set forth on Schedule I to the
Commitment Letter on the date hereof (and defined as Initial
Commitment Parties therein) and such other parties that
become Commitment Parties from time to time pursuant to the
terms of the Commitment Letter. The Commitment Parties
will pursuant to the Commitment Letter, severally and not
jointly, backstop the Second Lien DIP Facility in an amount
not to exceed $1,900,000,000 (the Backstop Commitment)
based on the respective percentages set forth on Schedule I to
the Commitment Letter.
Second Lien DIP Facility Rights
Holders
The following persons shall have the right to participate in
the Second Lien DIP Facility (such persons, the Second
Lien DIP Facility Rights Holder, and such rights,
the Participation Rights): (i) (a) All Holders of EFIH
Unsecured Note Claims shall receive their Pro Rata share of
91% of the Participation Rights; and (b) Fidelity shall receive
their Pro Rata share of 9% of the Participation Rights which
participation shall be in the form of Tranche A-3 Note;
provided, however, General Unsecured Claims Against EFH
may participate in the Equity Conversion by purchasing such
Tranche A-3 Notes held by Fidelity, if the Required Transfer
as described below has not occurred. Moreover, Fidelity
shall receive an $11.25 million payment from EFIH in
connection with the exercise of any Participation Rights. If
at any time (a) the IRS shall have denied the Debtors Ruling
Request or shall have informed the Debtors or their counsel,
whether orally or in writing, of its decision not to issue one or

2

more of the Required Rulings (the PLR Denial) and (b) the
Oncor TSA Amendment has not yet been approved, the
Required Commitment Parties shall have the sole and
exclusive right to require the holders of any Tranche A-3
Notes to transfer such notes to the Commitment Parties (the
Required Transfer) for a purchase price equal to the sum of
(i) the par amount of such notes plus accrued and unpaid
interest (including the PIK Interest (as defined below)),
which amount shall be payable on the purchase date, (ii) in
the event such assignment is consummated before the
payment of the One-Time PIK Fee (as defined below), 10%
of the par amount of such notes plus accrued and unpaid PIK
Interest, if any (but not, for the avoidance of doubt, any
accrued and unpaid cash interest), which amount shall be
payable on the purchase date, and (iii) a Pro Rata share of
any Prepayment Fee (as defined below) subsequently paid on
such Tranche A-3 Notes (which amount shall be paid by
EFIH to the holders of the Tranche A-3 Notes immediately
prior to such assignment and not the holders of the Tranche
A-3 Notes as of the date that the Prepayment Fee is due and
owing).
The Participation Rights of Holders of General Unsecured
Claims Against the EFIH Debtors shall be subject to ratable
reduction from participation by Selected Partners (if any), in
an aggregate amount not to exceed $400,000,000.
Administrative Agent To be determined.
Collateral Agent To be determined.
DIP Facility A second lien subordinated secured debtor-in-possession note
facility that consists of (a) the Tranche A Notes, composed of
(i) the Tranche A-1 Notes (the Tranche A-1 Notes) issued to
Holders of EFIH Unsecured Note Claims pursuant to the
Second Lien DIP Procedures, (ii) the Tranche A-2 Notes (the
Tranche A-2 Notes) issued to each Commitment Party
solely as a result of its obligation under the Investment
Commitment, the Selected Partners, Post-Funding Partners
and Specified Consultants, and (iii) the Tranche A-3 Notes
(the Tranche A-3 Notes and, together with the Tranche A-1
Notes and Tranche A-2 Notes, the Tranche A Notes) issued
to Fidelity, as a Holder of General Unsecured Claims Against
EFH, in each case, which will be available to be drawn in a
single drawing on the Closing in an amount up to
$1,900,000,000 to consummate the Second Lien Refinancing,
and (b) the Tranche B Notes.
Second Lien DIP Procedures The procedures for offering Participation Rights to eligible
Second Lien DIP Facility Rights Holders under the Second

3

Lien DIP Facility shall be on terms and conditions which are
consistent with this Term Sheet and otherwise satisfactory to
the Required Commitment Parties, EFH and EFIH (the
Second Lien DIP Procedures) in advance of the
consummation of the Second Lien DIP Facility.
The record date that shall determine the parties entitled to
Participation Rights shall be the date of the commencement of
the offering to eligible Second Lien DIP Facility Rights
Holders.
The Second Lien DIP Facility shall be funded by any and all
Second Lien DIP Facility Rights Holders that elect to
participate in their Pro Rata share of the Second Lien DIP
Facility and, with respect to any unfunded portion of the
Second Lien DIP Facility, Pro Rata by the Commitment
Parties in accordance with the terms of the Commitment
Letter (such funding parties, together, with their successors
and assigns, the Note Purchasers); provided that no
Commitment Party shall be permitted or required to exercise
any participation rights if, after giving effect to such
participation, the aggregate principal amount of the Second
Lien DIP Facility to be provided by such Commitment Party
when aggregated with the aggregate principal amount of the
Second Lien DIP Facility provided by affiliates of such
Commitment Party would exceed such Commitment Partys
Investment Commitment, provided, however, that such
Commitment Party may exceed such Commitment Partys
Investment Commitment to the extent necessary to satisfy any
Commitment of a Defaulting Commitment Party; provided,
further, that any party electing to exercise such participation
shall execute a joinder to the Restructuring Support
Agreement and Conversion Agreement as a precondition to
any such participation becoming effective.
Second Lien DIP Facility
Termination Date
All Second Lien DIP Notes shall become due and payable on
the DIP Facility Termination Date (as defined below), subject
to the Equity Conversion.
The DIP Facility Termination Date shall be the earliest of
(a) the Scheduled Termination Date (as defined below), (b) the
consummation of any Section 363 sale, (c) the effective date
of a plan of reorganization filed in the Chapter 11 Cases that is
confirmed pursuant to an order entered by the Bankruptcy
Court or (d) the acceleration of the notes and the termination
of the commitment with respect to the Second Lien DIP
Facility in accordance with the DIP Documents (as defined
below).
Scheduled Termination Date means the date that is 24

4

months from the date the Second Lien DIP Facility is funded.
Equity Conversion Upon the Effective Date, the Second Lien DIP Notes shall be
subject to conversion to Reorganized EFH Common Stock, on
the terms set forth in the Restructuring Support Agreement,
the Equity Conversion Term Sheet, and the Conversion
Agreement (as defined in the Equity Conversion Term Sheet).
If the Equity Conversion does not occur, the Tranche B Notes
shall convert to Tranche A-2 Notes.
Use of Proceeds Proceeds of the Second Lien DIP Facility will be used
(together with cash on hand and proceeds of the EFIH First
Lien DIP Financing) to (i) repay in full all outstanding
principal plus accrued and unpaid interest at the non-default
rate due and owing under the EFIH Second Lien Notes (which
shall not include any alleged premiums, fees or claims relating
to the repayment of such Claims) to Non-Settling EFIH
Second Lien Note Holders and (ii) repay the EFIH Second
Lien Notes held by Settling EFIH Second Lien Note Holders
in accordance with the EFIH Second Lien Settlement (clauses
(i) and (ii) collectively, the Second Lien Refinancing).
DIP Documents The Second Lien DIP Facility will be documented by a note
purchase agreement (the Note Purchase Agreement) and
other guarantee, security, intercreditor, and other relevant
documentation (together with the Note Purchase Agreement,
collectively, the DIP Documents) reflecting the terms and
provisions set forth in this Term Sheet and otherwise in form
and substance reasonably satisfactory to the Required
Commitment Parties and the Issuers; provided, however, that
such DIP Documents will be drafted in form and substance
consistent with the documents governing the EFIH First Lien
DIP Financing (the First Lien DIP Documents), with
adjustments made to reflect this Term Sheet. It is agreed that
each basket or cushion set forth in the covenants and
events of default contained in the DIP Documents shall be at
least 15% more than the corresponding provision in the First
Lien DIP Documents.
Transferability of Participation
Rights
Subject to compliance with all applicable securities laws,
unless otherwise agreed by the Issuers, the Participation
Rights will only be transferable to affiliates of Second Lien
DIP Facility Rights Holders and Selected Partners; provided,
however, the Participation Rights may not be transferred, and
any such transfer shall be null and void ab initio if, assuming
the Restructuring Transactions were to be consummated
immediately upon such Transfer, the transferee and/or its
affiliates of such transfer were to obtain or have beneficial
ownership of, in the aggregate, more than fifty percent (50%)

5

or more of the Reorganized EFH Common Stock.
Notwithstanding anything to the contrary herein, the Holders
of EFIH Senior Toggle Notes shall not transfer such EFIH
Senior Toggle Notes apart from the Pro Rata share of the
Participation Rights attributable to such EFIH Senior Toggle
Notes to any party other than affiliates or Selected Partners,
and any such transfer shall be retroactively void.
For the avoidance of doubt, any transferee of the Participation
Rights described above shall execute a joinder to the
Restructuring Support Agreement and Conversion Agreement
as a precondition to any transfer described above becoming
effective.
Transferability of Second Lien DIP
Notes
Subject to compliance with all applicable securities laws,
unless otherwise agreed by the Issuers, the Second Lien DIP
Notes shall only be transferable to (i) affiliates of a Note
Purchaser, (ii) other Note Purchasers and their respective
affiliates, and (iii) such other Persons that are qualified
institutional buyers or accredited investors, provided,
however, that such transfers of Second Lien DIP Notes are not
permitted if, in the reasonable business judgment of the
Issuers and their legal and tax advisors, in consultation with
the Commitment Parties, such transfers would adversely (a)
affect or delay the Debtors ability to obtain the Private Letter
Ruling or violate the terms and conditions of the Private Letter
Ruling or (b) affect or delay the Debtors ability to obtain the
regulatory consents or approval necessary to effectuate the
Restructuring Transactions, provided, further, that, any
transfer described above shall be null and void ab initio, if,
assuming the Restructuring Transactions were to be
consummated immediately upon such Transfer, the transferee
of such transfer (other than affiliates transfers) was to obtain
beneficial ownership of, in the aggregate, more than fifty
percent (50%) or more of the Reorganized EFH Common
Stock.
Notwithstanding anything to the contrary herein, the Holders
of EFIH Senior Toggle Notes that become Note Purchasers
shall not transfer such EFIH Senior Toggle Notes apart from
the Pro Rata share of the Second Lien DIP Notes attributable
to such EFIH Senior Toggle Notes and any such transfer shall
be retroactively void; provided, however, that any Tranche A-
2 Notes purchased by a Commitment Party solely as a result
of its obligation to do so under the Investment Commitment
shall be transferrable separately from such Commitment
Partys EFIH Senior Toggle Notes, that the Tranche B Notes
shall be transferrable separately from the Commitment
Parties EFIH Senior Toggle Notes and that any Tranche A-1

6

Notes transferred to Post-Funding Partners or Specified
Consultants pursuant to the provision below shall be
transferrable separately from such Commitment Partys EFIH
Senior Toggle Notes.
Notwithstanding anything herein to the contrary, at any time
prior to the earlier of the DIP Facility Termination Date and
the Equity Conversion, the Required Commitment Parties
(determined based on the amount of their respective
Investment Commitments immediately prior to the closing of
the Second Lien DIP Facility) may require (i) each Note
Purchaser holding Tranche A-1 Notes or Tranche A-2 Notes,
except those held by Selected Partners, Post-Funding Partners
(as defined below) or Specified Consultants, to sell, at a price
of no less than par value of such Second Lien DIP Notes plus
accrued but unpaid interest thereon, a Pro Rata portion of its
Second Lien DIP Notes to partners selected by the Required
Commitment Parties (the Post-Funding Partners) in an
amount such that after giving effect to all such sales, the Post-
Funding Partners shall own no more than $400,000,000 of
principal amount of Second Lien DIP Notes, after taking into
account all Second Lien DIP Notes owned (if any) by the
Post-Funding Partners immediately prior to any such sale and
any Tranche A-1 Notes received by such Post-Funding
Partners pursuant to the above shall automatically become
Tranche A-2 Notes (ii) each Note Purchaser holding Tranche
A-1 Notes or Tranche A-2 Notes, except those held by
Selected Partners, Post-Funding Partners or Specified
Consultants, to sell, at a price of no less than par value of such
Second Lien DIP Notes outstanding as of the Closing less paid
interest thereof, to date, a Pro Rata portion of its Second Lien
DIP Notes to consultants to the Administrative Agent or Initial
Commitment Parties (Specified Consultants) in an amount
up to $100,000,000 and any Tranche A-1 Notes received by
such Specified Consultant pursuant to the above shall
automatically become Tranche A-2 Notes.
For the avoidance of doubt, any transferee of Second Lien DIP
Notes described above shall execute a joinder to the
Restructuring Support Agreement as a precondition to any
transfer described above becoming effective.
Interest Rates The Tranche A Notes will bear interest at a fixed rate of 8%
per annum, payable in cash on the final business day of each
quarter beginning on the first such day after the Closing.
If the Bankruptcy Court has not entered an order approving
the Oncor TSA Amendment as of the date that is 90 days from
the Petition Date, the Tranche A Notes shall bear additional
interest at a rate of 4% per annum compounded quarterly, paid

7

in kind in additional Tranche A Notes, until such time as the
Oncor TSA Amendment is approved (the PIK Interest).
Default Interest During the continuance of an event of default (as defined in
the DIP Documents), overdue amounts on the Tranche A
Notes will bear interest at an additional 2% per annum.
Fees If the Bankruptcy Court has not entered an order approving
the Oncor TSA Amendment by the date that is one year from
the Petition Date, the Issuers shall pay a one-time fee in the
amount of 10.00% of the Tranche A Notes and Tranche B
Notes, as applicable, to the Note Purchasers, paid in kind in
additional Tranche A Notes and Tranche B Notes, as
applicable (the One-Time PIK Fee).
If the Second Lien DIP Facility is repaid in cash without the
consent of the Required Note Purchasers and other than upon
acceleration, the Issuers shall pay an optional prepayment fee
of $380 million (which payment may be waived upon the
written consent of the Required Note Purchasers (as defined
below) in their sole discretion, provided, however, that the
Required Note Purchasers may not waive the Prepayment Fee
with respect to the Tranche A-3 Notes) (the Prepayment
Fee) to the Note Purchasers.
Notwithstanding anything to the contrary herein, the Fidelity
Repayment (as defined in the Equity Conversion Term Sheet)
shall not constitute a repayment in cash of the Second Lien
DIP Facility.
Optional Prepayment The Issuers may prepay the Second Lien DIP Notes subject to
customary notice periods and payment of breakage costs and
the Prepayment Fee (which payment may be waived upon the
written consent of the Required Note Purchasers in their sole
discretion, provided, however, that the Required Note
Purchasers may not waive the Prepayment Fee with respect to
the Tranche A-3 Notes). Notwithstanding anything to the
contrary herein, the Fidelity Repayment (as defined in the
Equity Conversion Term Sheet) shall not constitute an
Optional Prepayment under the Second Lien DIP Facility and
shall not result in the Prepayment Fee being due.
Mandatory Prepayments The DIP Documents will contain mandatory prepayment
provisions found in the EFIH First Lien DIP Financing;
provided that, (a) notwithstanding anything to the contrary
herein, the Second Lien DIP Notes shall not be mandatorily
prepaid unless the EFIH First Lien DIP Financing is
mandatorily prepaid first and in full and (b) application of
mandatory prepayment amounts shall be subject to the

8

provisions of the Intercreditor Agreement.
Security and Priority All amounts owing by the Issuers under the Second Lien DIP
Facility and the obligations of the Guarantors in respect
thereof will be secured, subject to (i) the Carve-Out (as
defined in the commitment letter dated as of the date hereof
with respect to the EFIH First Lien DIP Facility among EFIH,
Deutsche Bank Securities Inc., as Left Lead DIP Facility
Arranger (as defined therein), and the other financial
institutions party thereto (the EFIH First Lien DIP
Commitment Letter)), (ii) the liens granted to secure the
EFIH First Lien DIP Financing and other liens and
encumbrances permitted by the DIP Documents and (iii) all
valid, perfected, enforceable and unavoidable liens as of the
Closing (the Permitted Liens), by a second priority
perfected security interest in all assets owned by the Issuers
that secures the EFIH First Lien DIP Financing, including,
without limitation, distributions pursuant to the Oncor TSA so
long as the Oncor TSA Amendment is in effect (the
Collateral).
The liens granted under the Second Lien DIP Facility will be
junior only to the (i) the Carve-Out, (ii) the liens granted to
secure the EFIH First Lien DIP Financing and other liens and
encumbrances permitted by the DIP Documents and (iii) the
Permitted Liens. The Issuers shall use commercially
reasonable efforts to obtain the entry of an order providing
that the liens under the Second Lien DIP Facility prime, and
are in all respects senior to, any Allowed EFIH Second Lien
Makewhole Claims of Non-Settling EFIH Second Lien Note
Holders.
In the Chapter 11 Cases, the Note Purchasers will be granted
in the DIP Order (as defined below) a superpriority
administrative claim under section 364(c)(1) of the
Bankruptcy Code for the payment of the obligations under the
Second Lien DIP Facility with priority above all other
administrative claims, subject to the Carve-Out and the liens
granted under the EFIH First Lien DIP Financing.
The Second Lien DIP Facility will be subject to an
intercreditor agreement, which includes, among other things,
customary payment block and standstill provisions
(the Intercreditor Agreement), in form and substance
reasonably acceptable to the lenders under the EFIH First Lien
DIP Financing, the Issuers, and the Note Purchasers.
Conditions Precedent to the
Closing
The closing date (the Closing) under the Second Lien DIP
Facility shall be subject to satisfaction (or waiver) of the

9

following conditions:
A. The DIP Documents shall be in form and substance
consistent with this Term Sheet and otherwise reasonably
satisfactory to the Required Commitment Parties, the
Administrative Agent, the Issuers and each of their
counsel.
B. The Chapter 11 Cases shall have been commenced by the
Issuers and the Guarantors and the same shall each be a
debtor and a debtor in possession.
C. The Restructuring Support Agreement shall be in full
force and effect and the Issuers shall be in compliance
with the Restructuring Support Agreement in all material
respects as of the Closing.
D. Substantially concurrently with the Closing, the DIP
Documents shall have been delivered, all applicable fees
and expenses shall have been paid, and all applicable liens
shall have been perfected.
E. Substantially concurrently with the Closing, proceeds of
the EFIH First Lien DIP Financing, which shall be on the
terms set forth in the Restructuring Support Agreement
and the aggregate principal amount under the EFIH First
Lien DIP Financing shall not exceed $5,400,000,000 (with
such changes that are not materially adverse to the Note
Purchasers) shall have been used (together with cash on
hand) to (i) repay in full all outstanding principal plus
accrued and unpaid interest at the non-default rate due and
owing under the EFIH First Lien Notes (which shall not
include any alleged premiums, fees or claims relating to
the repayment of such Claims) to Non-Settling EFIH First
Lien Note Holders and (ii) repay the EFIH First Lien
Notes held by Settling EFIH First Lien Noteholders in
accordance with the EFIH First Lien Settlement.
F. Substantially concurrently with the Closing, the Second
Lien Refinancing shall have been consummated.
G. The Administrative Agent shall have received a signed
copy of an order of the Bankruptcy Court in form and
substance satisfactory to the Required Commitment
Parties and the Issuers (the DIP Order), authorizing and
approving the issuance of the Second Lien DIP Notes and
the granting of the superpriority claims and liens and other
liens referred to above under the heading Security and
Priority, which DIP Order shall not have been vacated,
reversed, modified, amended or stayed, in a manner

10

adverse to the Note Purchasers, without the consent of the
Required Commitment Parties.
H. The Issuers shall have complied in all material respects
with the terms and conditions of the Second Lien DIP
Procedures, and the Participation Rights shall have been
allocated in accordance with the Second Lien DIP
Procedures.
I. No default (or any event which with the giving of notice
or lapse of time or both would be a default) under the
EFIH First Lien DIP Financing is then existing, after
giving effect to applicable grace periods or waivers, which
would permit the counterparty thereto to exercise
remedies thereunder on a post-petition basis.
J. The Administrative Agent shall have received a customary
opinion of counsel to the Issuers.
K. There shall not have occurred any circumstance or
conditions affecting the business, assets, operations,
properties or financial condition of the Issuers and their
subsidiaries taken as a whole, that would individually or
in the aggregate, materially adversely affect the ability of
the Issuers (taken as a whole) to perform their payment
obligations under the DIP Documents to which they are a
party, or the rights and remedies of the Agent and the
Note Purchasers under the DIP Documents (other than, in
each case, as a result of the events leading up to, and
following commencement of a proceeding under Chapter
11 of the Bankruptcy Code and the continuation and
prosecution thereof, including circumstances or conditions
resulting from, or incidental to, such events,
commencement, continuation and prosecution, which shall
not individually or in the aggregate constitute a Material
Adverse Event), and provided that nothing disclosed in
any of the following filings by EFIH and/or EFH (1) the
Annual Report on Form 10-K for the year ended
December 31, 2013, as filed on the date of the
Commitment Letter (to the extent substantially the same
in form and substance as the version provided to the
advisors of the Initial Commitment Parties prior to the
date of the Commitment Letter), (2) any filings on Form
8-K made through the date of the Commitment Letter
and/or (3) any disclosure statement related to any plan of
reorganization or liquidation of the Issuers provided to the
Commitment Parties on or prior to the date of the
Commitment Letter, shall, in any case, in and of itself and
based solely on facts as disclosed therein (without giving
effect to any developments not disclosed therein) be a

11

Material Adverse Event (any of the foregoing being a
L. Any and all governmental consents and approvals
necessary in connection with the Second Lien DIP Facility
shall have been obtained and shall remain in effect.
M. To the extent requested at least 5 business days prior to
Closing, each Note Purchaser who has requested the same
shall have received know your customer and similar
information.
The Note Purchasers shall have a valid and perfected
second priority lien on and security interest in the
Collateral pursuant to the DIP Order.
N. (i) There shall exist no default under the DIP Documents,
(ii) the representations and warranties of the Issuers and
each Guarantor therein shall be true and correct in all
material respects (or in the case of representations and
warranties with a materiality qualifier, true and correct
in all respects) immediately prior to, and after giving
effect to, such funding and (iii) the issuance of the Second
Lien DIP Notes shall not violate any requirement of law
and shall not be enjoined, temporarily, preliminarily or
permanently.

Representations and Warranties The DIP Documents will contain representations and
warranties consistent with those found in the First Lien DIP
Facility and shall include representations and warranties with
respect to: valid existence, compliance with law, requisite
power, due authorization, approvals, no conflict with material
postpetition agreements (to the extent enforceable post-
petition) or applicable law, enforceability of the DIP
Documents, ownership of subsidiaries and property, material
accuracy of financial statements and certain other written
information provided, litigation, absence of Material Adverse
Event, taxes, margin regulations, no default under the DIP
Documents, inapplicability of Investment Company Act, use
of proceeds, insurance, labor matters, ERISA, environmental
matters, security interests, necessary rights to intellectual
property and ownership of properties, DIP Order, sanctioned
persons, anti-corruption laws and Patriot Act.

12

Affirmative Covenants The DIP Documents will contain affirmative covenants
consistent with those found in the EFIH First Lien DIP
Financing (subject to the principles set forth in DIP
Documents above) and shall include affirmative covenants
with respect to:
A. Preservation of corporate existence.
B. Compliance with applicable laws (including ERISA and
environmental laws).
C. Conduct of business.
D. Payment of taxes.
E. Maintenance of insurance.
F. Access to books and records and visitation rights.
G. Maintenance of books and records.
H. Maintenance of properties.
I. Use of proceeds.
J. Provision of additional collateral and mortgages.
K. Delivery of certain reports and information.
L. Transactions with affiliates.
M. Certain bankruptcy matters.
N. Limitations on changes to fiscal year.
O. Further assurances.

Negative Covenants The DIP Documents will contain negative covenants
Financing (subject to the principles set forth in DIP
Documents above), which include negative covenants with
respect to:
A. Limitations on debt and guarantees.
B. Limitations on liens.


13

C. Limitations on loans and investments.
D. Limitations on asset dispositions, including, without
limitation, the issuance and sale of capital stock of
subsidiaries; provided that, no sales, dispositions, or other
transfers of equity interests in Oncor Electric Delivery
Holdings Company LLC shall be permitted.
E. Limitations on dividends, redemptions and repurchases
with respect to capital stock.
F. Limitations on cancellation of debt and on prepayments,
redemptions and repurchases of pre-petition debt, except
as expressly provided for in the DIP Documents or
pursuant to first day or other orders entered by the
Bankruptcy Court.
G. Limitations on fundamental changes.
H. Limitations on material changes in business.
I. Limitation on certain affiliate value transfers.
J. Limitations on sale/leasebacks.
K. Limitations on amendment of constituent documents
except for modifications that could not reasonably be
expected to materially and adversely affect the interests of
the Note Purchasers.
L. Limitation on amending, modifying, or terminating the
Oncor TSA Amendment, to the extent such agreement is
effective without consent of the Required Note
Purchasers.

M. Certain other bankruptcy matters.
Financial Covenants The DIP Documents will contain financial covenants
Financing, subject to a 15% cushion.
Reporting Requirements The DIP Documents will contain reporting requirements
Financing.
Events of Default The DIP Documents will contain events of default consistent
with those found in the EFIH First Lien DIP Financing (which
will be applicable to the Issuers, the Gurantors, and their
respective restricted subsidiaries), which (subject, where
appropriate, to grace periods and exceptions consistent with

14

those in the EFIH First Lien DIP Financing and to the
principles set forth in DIP Documents above) shall include
events of default with respect to:
A. Failure to pay principal, interest or any other amount
when due.
B. Representations and warranties incorrect in any material
respect when given.
C. Failure to comply with covenants (with grace period as
appropriate).
D. Cross-acceleration against post-petition indebtedness in
excess of an amount to be mutually agreed upon.
E. Failure to satisfy or stay execution of final postpetition
judgments in excess of an amount to be mutually agreed
upon.
F. The occurrence of certain ERISA events that result in a
Material Adverse Event.
G. Actual or asserted (by any Note Party or any affiliate
thereof) invalidity or impairment of any DIP Document
(including the failure of any lien to remain perfected).
H. Change of ownership or control.
I. (a) The entry of an order dismissing any of the Chapter 11
Cases or converting any of the Chapter 11 Cases to a case
under chapter 7 of the Bankruptcy Code,
(b) the entry of an order appointing a chapter 11 trustee in
any of the Chapter 11 Cases;

(c) the entry of an order staying, reversing, vacating or
otherwise modifying, in each case in a manner materially
adverse to the Administrative Agent or the Note
Purchasers, without the prior consent of the Commitment
Parties, the Second Lien DIP Facility or the DIP Order;

(d) the entry of an order in any of the Chapter 11 Cases
appointing an examiner having expanded powers (beyond
those set forth under sections 1106(a)(3) and (4) of the
Bankruptcy Code);

(e) the entry of an order in any of the Chapter 11 Cases
denying or terminating use of cash collateral by the Issuers
and such order has not be stayed or superseded by an order


15

granting use of cash collateral;

(f) the filing of any pleading by any Note Party seeking, or
otherwise consenting to, any of the matters set forth in
clauses (a) through (e) above;

(g) the entry of a final non-appealable order in the Chapter
11 Cases charging any of the Collateral under section
506(c) of the Bankruptcy Code against the Note Purchasers
or the commencement of other actions that is materially
adverse to the Administrative Agent, the Note Purchasers
or their respective rights and remedies under the Second
Lien DIP Facility in any of the Chapter 11 Cases or
inconsistent with the DIP Documents;

(h) the entry of an order granting relief from any stay of
proceeding (including, without limitation, the automatic
stay) so as to allow a third party to proceed against any
material assets of the Issuers in excess of an amount to be
mutually agreed upon in the aggregate;

(i) existence of any claims or charges, other than in respect
of the Carve-Out, the EFIH First Lien DIP Financing or
Second Lien DIP Facility or as otherwise permitted under
the DIP Documents, entitled to superpriority under Section
364(c)(1) of the Bankruptcy Code pari passu or senior to
the Second Lien DIP Facility; and

(j) the Note Parties or any of their subsidiaries, or any
person claiming by or through the Note Parties any of their
subsidiaries, shall obtain court authorization to commence,
or shall commence, join in, assist or otherwise participate
as an adverse party in any suit or other proceeding against
the Administrative Agent or any of the Note Purchasers
relating to the Second Lien DIP Facility.

(k) a plan shall be filed or confirmed in any of the Chapter
11 Cases that does not provide for either (i) the indefeasible
payment in full in cash of the obligations (other than
indemnities and other contingent obligations not then due
and payable) on the effective date of such plan or (ii)
conversion to Conversion Shares on terms pursuant to the
Equity Conversion.

Expenses and Indemnification The Issuers will indemnify the Administrative Agent, the
Commitment Parties, the Note Purchasers, their respective
affiliates, successors and assigns and the officers, directors,
employees, agents, advisors, controlling persons and members
of each of the foregoing (each, an Indemnified Person) and

16

hold them harmless from and against all costs, expenses (in
the case of legal counsel, limited to reasonable and
documented fees, disbursements and other charges) and
liabilities of such Indemnified Person arising out of or relating
to any claim or any litigation or other proceeding (regardless
of whether such Indemnified Person is a party thereto and
regardless of whether such matter is initiated by a third party
or by the Issuers or any of its affiliates) that relates to the
Second Lien DIP Facility or the transactions contemplated
thereby; provided that no Indemnified Person will be
indemnified for any cost, expense or liability to the extent
determined in the final, non-appealable judgment of a court of
competent jurisdiction to have resulted from its or its related
parties gross negligence, willful misconduct or bad-faith.
The Issuer shall reimburse the Administrative Agent for their
reasonable and documented out-of-pocket expenses incurred
in connection with the negotiation, documentation,
syndication and administration of the Second Lien DIP
Facility, any amendments or waivers with respect thereto, any
Event of Default in respect of the Second Lien DIP Facility
and any exercise of remedies in respect thereof (including
reasonable and documented out-of-pocket prepetition and
post-petition fees, charges and disbursements of legal counsel,
financial advisors and third-party appraisers and consultants
advising the Administrative Agent incurred in connection with
the Agents participation in the Chapter 11 Cases, limited in
the case of legal counsel to one primary counsel (and (i)
appropriate local counsel in applicable foreign and local
jurisdictions, but limited to one local counsel in each such
jurisdiction, (ii) appropriate regulatory counsel and (iii) solely
in the case of a conflict of interest, one additional counsel in
each relevant jurisdiction to the affected indemnified persons
similarly situated). The Issuer shall reimburse the reasonable
and documented out-of-pocket expenses of (i) Akin Gump
Strauss Hauer & Feld LLP, (ii) Cousins, Chipman & Brown
LLP, (iii) Ernst & Young LLP, (iv) Leidos, Inc., (v)
Centerview Partners LLC, and (vi) such other advisors
retained by the Required Commitment Parties, including any
regulatory counsel, during these cases (collectively, the
Commitment Party Professionals) incurred in connection
with the negotiation, documentation, syndication and
administration of the Second Lien DIP Facility, any
amendments or waivers with respect thereto, any Event of
Default in respect of the Second Lien DIP Facility and any
exercise of remedies in respect thereof (including reasonable
and documented out-of-pocket prepetition and post-petition
fees, charges and disbursements of Commitment Party
Professionals incurred in connection with the Note

17

Purchasers participation in the Chapter 11 Cases).
Required Note Purchasers Note Purchasers managed and/or advised by three or more
investment advisors holding at least 50.1% of the outstanding
commitments and/or exposure under the Second Lien DIP
Facility (the Required Note Purchasers).
Amendments Required Note Purchasers, except for provisions customarily
requiring approval by all directly and adversely affected Note
Purchasers or all Note Purchasers, including the reduction of
any portion of the principal amount of the Second Lien DIP
Notes, the reduction of the interest rate (other than as a result
of a default, events of default, or default interest) or the
extension of the final maturity date, provided, however, that
the Required Note Purchasers may waive the Prepayment Fee,
provided further, however, that the Required Note Purchasers
may not waive the Prepayment Fee with respect to the
Tranche A-3 Notes.
Miscellaneous The DIP Documents will include (i) standard yield protection
provisions (including, without limitation, provisions relating
to compliance with risk-based capital guidelines, increased
costs and payments free and clear of withholding taxes
(subject to customary qualifications)), (ii) waivers of
consequential damages and jury trial, (iii) customary agency,
set-off and sharing language and (iv) customary replacement
of lender provisions.
Governing Law and Submission to
Non-Exclusive Jurisdiction
State of New York.
Counsel to Commitment Parties
and Certain Note Purchasers
Akin Gump Strauss Hauer & Feld LLP.
Counsel to Administrative Agent To be determined by Administrative Agent


EXHIBIT I
CLOSING CONDITIONS


Annex I
SUMMARY OF CONDITIONS PRECEDENT TO THE DIP FACILITY
1. Final Order/Bankruptcy Matters.
(a) No later than the date that is one hundred and ten (110) days after the date of the
Commitment Letter, a final order shall have been entered by the Bankruptcy Court in
form and substance satisfactory to PIMCO (which shall in any case approve (i) the
entirety of the Term Facility and the repayment and/or settlement (including via an
exchange) in full of the principal amount plus any accrued and unpaid interest of the
EFIH First Lien Secured Notes with the proceeds of the Term Loans and Incremental
Term Loans and (ii) consistent with this Term Sheet, the payment of fees to PIMCO set
forth in the section titled EFIH First Lien Settlement and the reimbursement of
documented expenses of PIMCO (including fees, charges and disbursements of counsel))
(the Final Order) on a motion by the Debtors that is in form and substance satisfactory
to PIMCO, approving and authorizing on a final basis the matters and containing the
other provisions described in this Section 1.
(b) The Final Order shall not have been reversed, modified, amended, stayed or vacated, in
the case of any modification or amendment, in a manner, that is adverse to PIMCO,
without the consent of PIMCO.
(c) The Final Order shall be in full force and effect.
(d) The Debtors shall be in compliance in all material respects with the Final Order.
(e) The Cases shall have been commenced in the Bankruptcy Court and all of the first day
or shortly thereafter shall have been reviewed in advance by PIMCO.
(f) No trustee or examiner with enlarged powers (having powers beyond those set forth in
and other compensation contemplated by the Loan Documents and this Term Sheet to be
payable to PIMCO in respect of the DIP Facility shall have been paid to the extent
earned, due and payable.
(c) No Default or Event of Default shall exist under the DIP Facility.

2
3. Customary Closing Documents.
(a) The Debtors shall have complied with the following closing conditions in a manner
satisfactory to the Administrative Agent: (i) the delivery of customary legal opinions as
to authority, authorization, execution and delivery; corporate records and documents from
public officials, including good standing certificates; officers certificates; and notice of
borrowing; (ii) evidence of authority; and (iii) obtaining of any governmental consents, if
any, necessary in connection with the DIP Facility, the financing thereunder and related
transactions. PIMCO shall have received at least five (5) days prior to the Closing Date
all documentation and other information required by bank regulatory authorities under
applicable know-your-customer and anti-money laundering rules and regulations,
including the Patriot Act.
(b) The Loan Documents (which shall be consistent with the Documentation Principles and
this Term Sheet) shall have been entered into by the Debtors, the Agent and the Lenders.
(c) As a result of the extension of such credit, usage of the DIP Financing shall not exceed
the aggregate amount authorized by the Final Order.
(a) If the Final Order (or any order entered concurrently or prior to the entry of the Final
Order) approves the repayment in full of the EFIH First Lien Secured Notes with the
proceeds of the Term Facility, substantially concurrently with the borrowing under the
Term Facility, the principal amount plus any accrued and unpaid interest of the EFIH
First Lien Secured Notes (which, for the avoidance of doubt, shall not include make-
whole payments or premiums in respect of the EFIH First Lien Secured Notes unless
otherwise approved by the Borrower) shall be repaid in full.
(b) The Restructuring Support Agreement shall be in full force and effect and the Debtors
shall be in compliance with the Restructuring Support Agreement in all material respects
as of the Closing Date.

EXHIBIT J

Execution Version

104901095

Capitalized terms used but not defined herein shall have the meanings set forth in the
letter agreement, dated as of April 28, 2014 (the Commitment Letter), to which this Equity
Conversion Term Sheet is attached, or the Restructuring Support Agreement (as defined in the
Commitment Letter).
Issuer Reorganized Energy Future Holdings Corp. (Reorganized EFH).
Summary of Equity
Conversion
The newly issued common stock of Reorganized EFH shall consist of
100 million shares prior to the Equity Conversion and the issuance of
shares under the Reorganized EFH/EFIH Management Incentive Plan
(if any). In the Equity Conversion, the Second Lien DIP Notes shall
be mandatorily converted to 177,658,788 Conversion Shares plus an
additional 89,052 Conversion Shares for each million dollars of EFIH
Second Lien DIP Financing in excess of $1,995 million, and less
89,052 shares of Conversion Shares for each million dollars of EFIH
Second Lien DIP Financing of less than $1,995 million outstanding on
the Effective Date, including on account of the Equity Conversion
Fee, on the terms set forth herein (the Equity Conversion). Holders
of General Unsecured Claims Against EFH other than Fidelity may
elect to participate in their Pro Rata share (with all Holders of General
Unsecured Claims Against EFH) of up to 9% of the Equity
Conversion (such Holders, the Equity Conversion Participants)
provided that such Holders of General Unsecured Claims may only
participate in the Equity Conversion by purchasing Tranche A-3
Notes held by Fidelity or any direct or indirect transferee thereof, if
the Required Transfer (as defined in the Second Lien DIP Notes Term
Sheet) has not occurred. Such Holders shall fund such share in cash,
the proceeds of which shall be used by EFIH to repay in cash Tranche
A-3 Notes, Pro Rata, in respect of such share, simultaneously with the
Equity Conversion (the Fidelity Repayment); provided, further, that
the stated plan value of the Conversion Shares shall be at least equal
to the adjusted issue price of the EFIH Second Lien DIP Financing;
provided, however, that, for the avoidance of doubt, this is a
negotiated plan value solely for purposes of the deal embodied in this
Term Sheet and the Restructuring Support Agreement and shall not be
binding upon any party to the extent the Plan is not confirmed and
consummated. The number of Conversion Shares issued pursuant to
the Equity Conversion shall be adjusted to the extent that Reorganized
EFIH Equity Interests, or a combination of Reorganized EFH
Common Stock and Reorganized EFIH Equity Interests are issued
pursuant to the Equity Conversion.

Parties The parties entitled to participate in the Equity Conversion shall be

2

limited to the Note Purchasers under the Second Lien DIP Facility
and the Equity Conversion Participants (the Conversion Parties).
Conversion Agreement The parties acknowledge and agree that this Equity Conversion Term
Sheet does not include all of the conditions, covenants, closing
conditions, representations, warranties and other terms that would be
contained in definitive documents for transactions of this type. As
such, the Commitment Parties and EFH shall no later than 30 days
after the date of execution of the Commitment Letter, enter into a
conversion agreement (the Conversion Agreement) containing the
terms and conditions set forth in this Equity Conversion Term Sheet,
the Commitment Letter and other customary terms and conditions
for transactions of this type, and which must be consistent with the
Restructuring Support Agreement and reasonably satisfactory to at
least three (3) investment advisors that manage and/or advise funds
or accounts that beneficially own, collectively, at least 66.6% of the
EFIH Unsecured Note Claims held by all Consenting Creditors (the
Required EFIH Unsecured Consenting Creditors) and EFH, which
Conversion Agreement shall be incorporated by reference into the
Note Purchase Agreement or shall be attached as an exhibit thereto.
Organizational
Documents

Corporate governance for Reorganized EFH and Reorganized EFIH,
including charters, bylaws, operating agreements, or other
organization documents, as applicable (the Organizational
Documents), shall be consistent with section 1123(a)(6) of the
Bankruptcy Code (as applicable) and the Tax Matters Agreement,
shall be determined by the Required EFIH Unsecured Consenting
Creditors in consultation with (i) EFH, (ii) EFIH, and, (iii) as
appropriate, with other Holders of EFIH Second Lien DIP Claims or
EFIH Unsecured Note Claims that upon the Effective Date will
receive greater than 15% of the Reorganized EFH Common Stock.

Registration Rights Reorganized EFH and any Conversion Parties that will constitute
affiliates of Reorganized EFH under the Securities Act of 1933 after
the Effective Date will enter into a registration rights agreement (the
Registration Rights Agreement), which shall contain such terms and
conditions reasonably satisfactory to the Required EFIH Unsecured
Consenting Creditors and as necessary to comply with the terms of the
Private Letter Ruling and provide for registration rights, including
demand, piggyback and shelf registration rights, with the number of
long form demand registration rights to be determined by the Required
EFIH Unsecured Consenting Creditors.
Transferability of
Converted Shares
The Conversion Shares will be transferable, subject to compliance with
applicable securities laws (including the Securities Act of 1933, as
amended) and the terms of the Private Letter Ruling.

3

Representations and
Warranties:
The Conversion Agreement shall contain customary representations and
warranties of EFH and the Commitment Parties for transactions of this
type, consistent with the Second Lien DIP Facility.
Covenants The Conversion Agreement will contain covenants of EFH and EFIH,
as provided by, consistent with, and subject to the Restructuring
Support Agreement.
Conditions Precedent to
Closing

The Equity Conversion will be conditioned upon satisfaction of terms
and conditions in the Conversion Agreement, as provided by, consistent
with, and subject to the Restructuring Support Agreement, including,
without limitation, the following:

The Restructuring Support Agreement shall be in full force and
effect as of the closing of the Equity Conversion and shall not have
been amended or modified without the prior consent of the
Required EFIH Unsecured Consenting Creditors in violation of the
terms of the Restructuring Support Agreement;
The Bankruptcy Court shall have entered the Disclosure Statement
Order, and such order shall be in full force and effect and not
subject to a stay;
The Bankruptcy Court shall have entered the Confirmation Order,
and such order shall be in full force and effect and not subject to a
stay;
The Registration Rights Agreement shall be in form and substance
reasonably satisfactory to the Required EFIH Unsecured
Consenting Creditors;
Any and all governmental and third party consents and approvals
necessary in connection with the Equity Conversion and the Plan
Restructuring Documents shall have been obtained and shall
remain in effect;
The Private Letter Ruling shall have been obtained from the IRS;
The Plan shall have become, or simultaneously with the issuance of
the New Reorganized EFH Stock will become, effective;
The covenants to be performed by EFH and EFIH in the
Conversion Agreement shall have been performed and complied
with in all material respects on the closing date of the Equity
Conversion; and
There shall not have been a continuing default (or any event which

4

with the giving of notice or lapse of time or both would be a
default) under the Second Lien DIP Facility.
Termination of Equity
Conversion
All of the obligations of the Commitment Parties, Conversion Parties,
EFH, and EFIH shall be of no further force or effect, upon the giving of
written notice of termination by the Required EFIH Unsecured
Consenting Creditors, in the event of:
a termination of the Restructuring Support Agreement by any
party thereto, or the Commitment Letter; or
an event of default, cancellation and/or acceleration of the
Second Lien DIP Facility.
Indemnification EFH and EFIH shall, jointly and severally, indemnify and hold
harmless each Conversion Party not indemnified under the
Commitment Letter, and their respective affiliates, shareholders,
members, partners, and other equity holders, general partners, managers
and its and their respective Representatives, agents and controlling
persons (each, an Indemnified Person) from and against any and all
losses, claims, damages, liabilities, and costs and expenses that any
such Indemnified Person may incur or to which any such Indemnified
Person may become subject arising out of or in connection with the
Plan, the Plan Restructuring Documents, the Equity Conversion, or any
matter relating to the foregoing.
Amendments Amendments to the Conversion Agreement will require the consent of
the ; provided that, amendments relating to allocation percentages, fees,
or otherwise disproportionately and materially adversely affecting a
Conversion Party, shall require the consent such Conversion Party.


EXHIBIT K
SUMMARY OF KEY REPRESENTATIONS

508551 000027 9635425.5
Summary of Key Representations For Ruling Request Under IRC 368(a)(1)(G) and 355

The ruling request expected to be filed by EFH with respect to its distribution of Spinco to
the TCEH first lien creditors will include the representations set forth herein and any other
representations reasonably acceptable to the TCEH Creditors and required for rulings for
reorganizations under Section 368(a)(1)(G) and distributions under Section 355. Probably the most
significant representation is that EFH and Spinco have actively conducted their respective businesses
(regulated and competitive) for the past five years and will continue to actively conduct their
respective businesses after the reorganization. Indeed, the Tax Matters Agreement will prohibit EFH
and Spinco from ceasing to actively conduct their respective businesses after the reorganization.

The ruling request may include over 50 representations in total. The following is a summary
of certain key representations:

1. EFH, EFIH, TCEH and Spinco will be under the jurisdiction of the court in a Title 11 case
and the G reorganization and the distribution of Spinco will occur pursuant to the bankruptcy
plan in such cases.
2. The Spinco stock and other consideration distributed by EFH will be received by the TCEH
creditors in their capacity as holders of interests in EFH.
3. The EFH group has actively conducted both the regulated and competitive businesses for the
last five years, and EFH and Spinco will continue to actively conduct their respective
businesses after the reorganization.
4. The reorganization will be carried out for the purpose of restructuring the debt of the EFH
group and is motivated in whole or substantial part by such purpose.
5. After the reorganization, no person will own (i) 50% or more of EFH stock that was acquired
by purchase within the last five years, or (ii) 50% or more of Spinco stock that was
received in the distribution with respect to EFH stock or securities that was acquired by
purchase within the last five years.
6. The aggregate fair market value of the assets transferred to Spinco will exceed their
aggregate tax basis.
7. The aggregate fair market value of the assets transferred to Spinco will exceed the liabilities
of Spinco at the time of the reorganization.
8. Except for the Spinco securities issued in connection with the reorganization, the liabilities
assumed by Spinco in the reorganization were incurred in the ordinary course of business.
9. There will be no debt between EFH and Spinco at the time of, or subsequent to, the
reorganization (except for debt incurred in the ordinary course of business).
10. Except for an elimination or reduction of intercompany balances in connection with the
reorganization, EFH will neither accumulate its receivables nor make any extraordinary
payment of its payables in anticipation of the reorganization.
11. Any transactions between EFH and Spinco after the reorganization will be on arms length
terms.
12. Neither EFH nor Spinco are an investment company under the Internal Revenue Code.
13. All of the parties will pay their own expenses incurred in connection with the reorganization.

EXHIBIT B to
Notes Claims
As used herein, the defined term Notes Claims collectively refers to any and all obligations of
the Debtors arising under any of the following:
i. the 15% senior secured second lien notes due April 1, 2021 (the TCEH Second Lien
Notes) issued by TCEH and TCEH Finance, Inc. pursuant to an Indenture (as amended,
restated, supplemented, or otherwise modified from time to time), dated as of October 6,
2010, by and among TCEH and TCEH Finance, as the issuers; EFCH and certain of the
TCEH Subsidiaries, as guarantors; and Wilmington Savings Fund Society, FSB, as
successor trustee to BNY (together with all Claims arising in connection with the TCEH
Second Lien Notes, the TCEH Second Lien Note Claims);
ii. the 10.25% senior notes due November 1, 2015 (the TCEH 2015 Notes) issued by
TCEH and TCEH Finance, Inc. pursuant to an Indenture (as amended, restated,
supplemented, or otherwise modified from time to time), dated as of October 31, 2007,
by and among TCEH and TCEH Finance, as the issuers; EFCH and certain TCEH
Subsidiaries, as guarantors; and Law Debenture Trust Company of New York, as
successor trustee to BNY (together with all Claims arising in connection with the TCEH
2015 Notes, the TCEH 2015 Note Claims); and
iii. the 10.50%/11.25% unsecured toggle notes due November 1, 2016 (the TCEH Senior
Toggle Notes and, together with the TCEH 2015 Notes, the TCEH Unsecured
Notes) issued by TCEH and TCEH Finance pursuant to an Indenture, dated as of
December 6, 2007, by and among TCEH and TCEH Finance, as the issuers; EFCH and
certain of the TCEH Subsidiaries, as guarantors; and Law Debenture Trust Company of
New York, as successor trustee to BNY (together with all Claims arising in connection
with the TCEH Senior Toggle Notes, the TCEH Senior Toggle Note Claims).


EXHIBIT C to
Commitment Letter

Execution Version

PRIVILEGED AND CONFIDENTIAL

April 28, 2014

Energy Future Intermediate Holdings Company LLC
Energy Plaza
1601 Bryan Street
Dallas, TX 75201

Re: Investment Commitment
Ladies and Gentlemen:

Reference is made to the Restructuring Support and Lock-Up Agreement, dated as of
April 28, 2014 (the Restructuring Support Agreement), by and among Energy Future Holdings
Corp. (EFH), Energy Future Intermediate Holding Company LLC (EFIH), and certain of
their affiliates (collectively, the Debtors), the other parties thereto, and parties listed on the
signature pages hereto (the Initial Commitment Parties), and the term sheets and other
documents attached to the Restructuring Support Agreement, pursuant to which EFH and EFIH
intend to engage in a restructuring of their existing liabilities in accordance with the Bankruptcy
Code (the Restructuring). Capitalized terms used in this letter agreement and not otherwise
defined herein shall have the meanings provided in the Restructuring Support Agreement or the
Restructuring Term Sheet attached thereto (subject to Section 2 of the Restructuring Support
Agreement).

The Restructuring contemplates, among other things, that the Commitment Parties and
the Selected Partners, if any (as defined below), will, severally and not jointly, backstop a second
lien subordinated secured debtor-in-possession note facility in accordance with the terms of the
Second Lien DIP Notes Term Sheet (as defined below) (the Second Lien DIP Facility) that
consists of (a) non-amortizing notes in an amount up to $1,900,000,000 (the Tranche A Notes)
and (b) non-amortizing, non-interest-bearing notes issued in full satisfaction of the Funding PIK
Fee (as defined below) (the Tranche B Notes and, together with the Tranche A Notes, the
Second Lien DIP Notes). The Debtors will offer the right to purchase the Tranche A Notes to
(i) Holders of General Unsecured Claims Against the EFIH Debtors (such Tranche A Notes, the
Tranche A-1 Notes), subject to ratable reduction from participation by Selected Partners (as
defined below), if any, in an aggregate amount not to exceed $400,000,000 and (ii) General
Unsecured Claims Against EFH held by Fidelity (such Tranche A Notes, the Tranche A-3
Notes), subject to the conditions set forth in the Restructuring Support Agreement and the term
sheet attached hereto as Exhibit A (the Second Lien DIP Notes Term Sheet) .

Upon the Effective Date, the Second Lien DIP Notes shall be subject to conversion to
Reorganized EFH Common Stock (the Equity Conversion), on the terms set forth in the
Restructuring Support Agreement, the term sheet attached hereto as Exhibit B (the Equity

2

Conversion Term Sheet), and the Conversion Agreement (as defined in the Equity Conversion
Term Sheet).

To provide assurances that the issuance of the Second Lien DIP Notes will be
consummated, the Initial Commitment Parties hereby, severally and not jointly, commit to
backstop the Second Lien DIP Notes in the respective percentages set forth on Schedule I hereto,
on the terms and conditions described herein (including in the Second Lien DIP Notes Term
Sheet and the Equity Conversion Term Sheet) and the Restructuring Support Agreement;
provided, however, that the aggregate amount of such backstop shall not exceed $1.9 billion
($1,900,000,000) (the Investment Commitment). The Required Commitment Parties (as
defined below) may from time to time (in their sole discretion), up to the date of funding of the
Second Lien DIP Facility, select certain partners to transfer the Participation Rights to or to
participate in the Investment Commitment in an aggregate amount not to exceed $400,000,000 of
the aggregate Investment Commitment, in each case on prior written consent of EFH and EFIH
unless such party is included on Schedule III hereto (the Selected Partners); and any such
inclusion of Selected Partners by the Required Commitment Parties shall ratably reduce each
Commitment Partys portion of the Investment Commitment; provided, however, that such
Selected Partner shall execute a joinder to this letter agreement, the Restructuring Support
Agreement (in accordance with Section 4.04 thereof), and any applicable definitive document for
the Second Lien DIP Notes; provided, further, that if a proposed transfer to a Selected Partner
were to cause a Commitment Party to transfer more than 50% of its portion of the Investment
Commitment (when taken in the aggregate with all other transfers of such Commitment Partys
portion of the Investment Commitment in accordance with the below), then the Required
Commitment Parties may choose to (x) reduce the amount of the Investment Commitment to be
transferred to the Selected Partner to an amount in which such Commitment Party would no
longer be transferring 50% (in the aggregate) of its portion of the Investment Commitment or (y)
cancel the contemplated transfer of the Investment Commitment. In addition, an Initial
Commitment Party may in its sole discretion select a Selected Partner, or other party otherwise
consented to by EFH and EFIH (the Transferee Commitment Parties) to purchase all or a
portion of an Initial Commitment Partys portion of the Investment Commitment; provided, that,
with respect to an affiliate Transferee Commitment Party, the transferring Initial Commitment
Partys obligations with respect to the transferred portion of the Investment Commitment shall
remain; provided, further, all Transferee Commitment Parties shall execute a joinder to this letter
agreement, the Restructuring Support Agreement (in accordance with Section 4.04 thereof), and
any applicable definitive document for the Second Lien DIP Notes; provided, further, if such
transfer were to cause such Initial Commitment Party to transfer more than 50% of its portion of
the Investment Commitment (when taken in the aggregate with all other transfers of its portion
of the Investment Commitment by such Initial Commitment Party), such proposed transfer shall
be deemed null and void ab initio. Subject to the foregoing, following any such sale or transfer
by an Initial Commitment Party of all or a portion of its Investment Commitment, such Initial
Commitment Partys obligations with respect to such sold or transferred Investment
Commitment shall cease. No Commitment Party other than an Initial Commitment Party shall
be permitted to transfer any portion of the Investment Commitment. For purposes of this letter
agreement, (i) the term Commitment Party shall mean, collectively, the Initial Commitment
Parties, the Selected Partners, and the Transferee Commitment Parties, and Schedule I hereto
shall be updated accordingly to account for any additional Commitment Parties and (ii) the term

3

Required Commitment Parties shall mean, at any relevant time, three (3) Initial Commitment
Parties (other than a Defaulting Commitment Party) that manage and/or advise funds or accounts
that beneficially own, collectively, at least 66.6% of the Investment Commitment.
Notwithstanding anything to the contrary contained herein, the identity of each Commitment
Party shall be reasonably acceptable to the Borrowers.
In consideration for the Investment Commitment and on the terms set forth in this
Commitment Letter and the Restructuring Support Agreement, EFIH shall (A) pay Pro Rata
based on the respective percentages set forth on Schedule II hereto an amount in cash equal to
0.46% of $1.9 billion ($1,900,000,000) to the Initial Commitment Parties (the Execution Fee),
which such Execution Fee shall be paid upon execution of this letter agreement, (B) subject to
entry of the Approval Order, pay Pro Rata based on the respective percentages set forth on
Schedule II hereto an amount in cash equal to 0.54% of $1.9 billion ($1,900,000,000) to the
Initial Commitment Parties (the Approval Fee), which Approval Fee shall be paid within 5
days of entry of the Approval Order, (C) subject to entry of the Approval Order and the funding
of the Second Lien DIP Facility, pay GSO and Avenue an arranger fee of $1,000,000 each in cash
(the Arranger Fees), which Arranger Fees shall be paid within 5 days of entry of the Approval
Order, (D) subject to entry of the Approval Order and the funding of the Second Lien DIP
Facility, pay Pro Rata based on the respective percentages set forth on Schedule I hereto an
amount in cash equal to 1.0% of $1.9 billion ($1,900,000,000) to the Commitment Parties (the
Funding Cash Fee), which Funding Cash Fee shall become due and be paid in full by EFIH
simultaneously with the funding of the Second Lien DIP Facility, and (D) issue Pro Rata based
on the respective percentages set forth on Schedule I hereto an amount equal to 5.00% of $1.9
billion ($1,900,000,000) to the Commitment Parties in the form of Tranche B Notes (the
Funding PIK Fee and, collectively with the Execution Fee, the Approval Fee, the Arranger
Fees, and the Funding Cash Fee, the Commitment Fee), which Funding PIK Fee shall become
due and be paid in full by EFIH simultaneously on the funding of the Second Lien DIP Facility.
EFH and EFIH agree that the Commitment Fee and the Alternative Transaction Fee shall be
nonrefundable once paid on the terms set forth in this letter agreement and that the Commitment
Fee, the Alternative Transaction Fee and any other payments hereunder shall be paid without
setoff or recoupment and shall not be subject to defense or offset on account of any claim,
defense or counterclaim. For the avoidance of doubt, the Approval Fee, the Arranger Fee, and
the Alternative Transaction Fee shall not be paid to any Defaulting Commitment Party.

If and to the extent that any one Commitment Party or multiple Commitment Parties do
not satisfy its or their obligations in respect of its or their Pro Rata portion of the Investment
Commitment (each such Commitment Party, a Defaulting Commitment Party), then each of
the remaining non-defaulting Commitment Parties (the Non-Defaulting Commitment Parties)
shall have the right, but not the obligation (the Default Purchase Right), to assume all or a
portion of the Investment Commitment that was to be funded by such Defaulting Commitment
Party (the Defaulted Investment Commitment). To the extent that the Non-Defaulting
Commitment Parties (in the aggregate) desire to assume more than the total amount of the
Defaulted Investment Commitment, then such Defaulted Investment Commitment shall be
allocated among the Non-Defaulting Commitment Parties electing to assume the Defaulted
Investment Commitment Pro Rata based on the respective percentages set forth on Schedule I
hereto; provided, however, that if a Non-Defaulting Commitment Party is a Selected Partner,
then such Non-Defaulting Commitment Party may only assume such portion of the Defaulted

4

Investment Commitment so as not to exceed $400,000,000 of the Investment Commitment
(calculated with all other Selected Partners). Each Defaulting Commitment Party shall
immediately pay to each Non-Defaulting Commitment Party that elects to assume all or a portion
of the Defaulted Investment Commitment, any portion of the Execution Fee, Approval Fee, and
Arranger Fee received by such Defaulting Commitment Party, directly or indirectly, based on
such Non-Defaulting Partys Pro Rata share of the Defaulted Investment Commitment so
assumed by such Non-Defaulting Commitment Party. For purposes of the Commitment
Percentages set forth on Schedule I hereto, the Commitment Percentage for each of the Non-
Defaulting Commitment Parties electing to exercise the Default Purchase Right shall be adjusted
accordingly to reflect the reallocation of the Defaulting Commitment Partys Commitment
Percentage among the Non-Defaulting Committing Parties electing to exercise the Default
Purchase Right (such that the total Commitment Percentage for the Non-Defaulting Commitment
Parties shall equal 100%). In the event that the entire Defaulted Investment Commitment is not
assumed by the Non-Defaulting Commitment Parties, the Required Commitment Parties may
assign to a Selected Partner all or the remaining portion of the Defaulted Investment
Commitment and following such assignment, Schedule I shall be accordingly adjusted as set
forth in the immediately foregoing sentence.
Whether or not the transactions contemplated hereby are consummated, but subject to
entry of the Approval Order, the Commitment Parties (other than any Defaulting Commitment
Party and their respective affiliates and representatives, the Indemnified Parties) shall be
indemnified and held harmless by EFH and EFIH, on a joint and several basis, from and against
any and all losses, claims, damages, liabilities and expenses as a result of a claim by a third party,
which any such Indemnified Parties may incur, have asserted against it or be involved in as a
result of or arising out of or in any way related to this letter agreement, the matters and
transactions referred to herein, the proposed Investment Commitment contemplated hereby, the
use of proceeds thereunder or any related transaction or any claim, litigation, investigation or
proceeding relating to any of the foregoing, regardless of whether any of such Indemnified
Parties is a party thereto, and to reimburse each of such indemnified persons for any legal or
other expenses incurred in connection with any of the foregoing from the date of the execution of
this letter agreement until the termination of this letter agreement (for the avoidance of doubt,
any claim for indemnification made after termination of this letter agreement for any event
arising prior to the termination of this letter agreement shall not thereafter be barred and all
claims for indemnification hereunder shall survive until finally resolved); provided, however,
that the foregoing indemnity will not, as to any indemnified person, apply to losses, claims,
damages, liabilities or related expenses to the extent they have resulted from the bad faith or
willful misconduct of such indemnified person (as determined by a court of competent
jurisdiction in a final and non-appealable judgment). The terms set forth in this paragraph shall
survive termination of this letter agreement. This letter agreement is not assignable (a) by either
of EFH or EFIH, without the prior written consent of the Required Commitment Parties (and any
purported assignment without such consent shall be null and void ab initio), or (b) by any of the
Commitment Parties, except to (i) its affiliates, subject to the terms and conditions contained
herein (provided that such Commitment Party shall remain liable hereunder) or a Transferee
Commitment Party as set forth above and (ii) the Commitment Parties may assign all or a portion
of the Commitment Parties obligations hereunder to the Selected Partners as set forth
above. This letter agreement is intended to be solely for the benefit of the parties hereto and is

5

not intended to confer any benefits upon, or create any rights in favor of, any person other than
the parties hereto.

The obligations of the Commitment Parties to fund the Investment Commitment are
conditioned upon satisfaction of, inter alia, each of the conditions set forth herein, in the
Restructuring Support Agreement and in the Second Lien DIP Notes Term Sheet.

This letter agreement shall terminate upon the termination of the Restructuring Support
Agreement. Subject to entry of the Approval Order, if EFIH enters into definitive documentation
with respect to a reorganization, restructuring, merger, consolidation, share exchange, rights
offering, equity investment, business combination, recapitalization or similar transaction
(including the sale of all or substantially all of the assets of EFH, EFIH, or any other Debtor)
involving EFIH on equal or better terms and conditions for EFIH than those contemplated in the
Restructuring Support Agreement and the Term Sheet (such transaction, an Alternative
Transaction), the Debtors shall pay Pro Rata based on the respective percentages set forth on
Schedule II hereto, an amount in cash equal to 3.00% of $1.9 billion ($1,900,000,000) to the
Initial Commitment Parties (the Alternative Transaction Fee), which Alternative Transaction
Fee shall become due and be paid in full within 5 days Bankruptcy Court approval of such
Alternative Transaction. For the avoidance of doubt, the Alternative Transaction Fee shall not
become due or be payable if the Debtors consummate an Alternative Transaction because of the
failure of the Commitment Parties to fulfil their obligations under the Investment Commitment.

All rights and remedies provided in this letter agreement are cumulative and not
exclusive of any other rights or remedies that may be available to EFH, EFIH, and the
Commitment Parties, including (without limitation) all rights to specific performance, or as
otherwise provided by law, equity, statute, or in any other agreement entered into in connection
with any of the transactions contemplated hereunder, including as to any Defaulting
Commitment Party.

Upon execution of this letter agreement, EFH shall or shall cause EFIH to promptly pay
(i) Akin Gump Strauss Hauer & Feld LLP, by wire transfer of immediately available funds, an
advance payment of $3,000,000 (the Akin Gump Advance Payment) and (ii) Centerview
Partners LLC, by wire transfer of immediately available funds an advance payment of $675,000
(the Centerview Advance Payment, and together with the Akin Gump Advance Payment, the
Advance Payment). In accordance with the terms of that certain amended and restated
engagement letter with EFIH dated April 27, 2014 (as may be amended or modified from time to
time, the Centerview Engagement Letter), EFH shall or shall cause EFIH to promptly pay
Centerview an aggregate arrangement payment of $5,000,000, which shall be paid as follows (x)
$1,250,000 shall be paid upon the execution of this letter agreement (the Arrangement
Payment I), (y) $1,250,000 shall be paid simultaneously be paid within 2 days of entry of the
EFIH Second Lien DIP Order (the Arrangement Payment II) and (z) $2,500,000 shall be paid
simultaneously with the funding of the Second Lien DIP Notes (the Arrangement Payment III,
and together with the Arrangement Payment I and Arrangement Payment II, the Arrangement
Payment). Upon entry of the Approval Order, EFH and EFIH agree to pay, within 15 business
days of delivery of an invoice (which shall include reasonable supporting detail, which may be
redacted to protect privileged or confidential information), the unpaid reasonable and

6

documented fees and expenses of Akin Gump Strauss Hauer & Feld LLP, pursuant to that certain
engagement letter with EFIH dated May 24, 2013 (as may be amended or modified from time to
time), Centerview Partners LLC, pursuant to the Centerview Engagement Letter and, without
limitation, all other out-pocket fees, costs and expenses of the Commitment Parties, including the
fees and expenses of the Commitment Party Professionals incurred previously or in the future
relating to the Restructuring or the Chapter 11 Cases, pursuant to applicable engagement letters
entered into between such professionals and EFH or EFIH, as applicable (such fees and
expenses, the Professional Fees). Payment of the Advance Payment, the Arrangement
Payment and Professional Fees shall not be subject to allowance by the Bankruptcy Court;
provided, however, that EFH and EFIH shall promptly provide copies of invoices received on
account of the Professional Fees to the U.S. Trustee and counsel to any Committee appointed in
the Cases, and the Bankruptcy Court shall have exclusive jurisdiction over any objections raised
to the invoiced amount of the Professional Fees, which objections may only be raised within 15
business days after delivery of an invoice(s) therefor. In the event that within 15 business days
from delivery of such invoices EFH, EFIH, the U.S. Trustee, or counsel to the Committee raises
an objection to a particular invoice, and the parties are unable to resolve such objection, the
Court shall hear and determine such dispute; provided that payment of invoices shall not be
delayed based on any such objections and the relevant professional shall only be required to
disgorge amounts objected to upon being so ordered pursuant to a final order of the
Bankruptcy Court. EFH and EFIH agree that the Advance Payment, Arrangement Payment and
Professional Fees shall be nonrefundable and that the Advance Payment, Arrangement Payment
and Professional Fees and any other payments hereunder shall be paid without setoff or
recoupment and shall not be subject to defense or offset on account of any claim, defense or
counterclaim. Notwithstanding anything to the contrary herein, the Debtors shall not be
obligated for any of the professional fees or other obligations described in this paragraph
incurred after this letter agreement terminates.

This letter agreement shall be governed by, and construed in accordance with, the internal
laws of the State of New York, without giving effect to the principles of conflict of laws that
would require the application of the law of any other jurisdiction. By its execution and delivery
of this letter agreement, each of the parties hereto hereby irrevocably and unconditionally agrees
for itself that any legal action, suit or proceeding against it with respect to any matter under or
arising out of or in connection with this letter agreement or for recognition or enforcement of any
judgment rendered in any such action, suit or proceeding, may be brought in either a state or
federal court of competent jurisdiction in the State of New York. By execution and delivery of
this letter agreement, each of the parties hereto hereby irrevocably accepts and submits itself to
the nonexclusive jurisdiction of each such court, generally and unconditionally, with respect to
any such action, suit or proceeding. Notwithstanding anything to the contrary herein, upon the
commencement of the Chapter 11 Cases, each of the parties hereto hereby agrees that, if the
petitions have been filed and the Chapter 11 Cases are pending, the Bankruptcy Court shall have
exclusive jurisdiction over all matters arising out of or in connection with this letter agreement.
EACH PARTY HERETO UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING REFERRED TO ABOVE.

This letter agreement may not be amended or waived except in a writing signed by EFH,
EFIH, and the Initial Commitment Parties. Notwithstanding the foregoing, this letter agreement

7

may be amended by the Initial Commitment Parties to add Selected Partners and Transferee
Commitment Parties as Commitment Parties in accordance with the terms of this letter
agreement. This letter agreement may be executed in several counterparts, each of which shall
be deemed to be an original, and all of which together shall be deemed to be one and the same
agreement. Execution copies of this letter agreement may be delivered by facsimile, electronic
mail or otherwise, each of which shall be deemed to be an original for the purposes of this
paragraph.

Notwithstanding anything contained herein, each Initial Commitment Party
acknowledges that its decision to enter into this letter agreement has been made by such
Commitment Party independently of any other Commitment Party.

This letter agreement (including the exhibits and schedules hereto), along with the
Restructuring Support Agreement (including the exhibits and schedules thereto), constitutes the
entire understanding among the parties hereto with respect to the subject matter hereof and
replaces and supersedes all prior agreements and understandings, both written and oral, between
the parties hereto with respect to the subject matter hereof, and shall become effective and
binding upon (i) the mutual exchange of fully executed counterparts by the EFH and EFIH and
all of the Commitment Parties, and (ii) payment by EFH or EFIH of the Execution Fee, the
Advance Payment, the Arranger Fee, and the Arrangement Payment I in accordance with the
above.

[SIGNATURE PAGES FOLLOW]

Signature page to letter agreement.
If the foregoing is in accordance with your understanding of our agreement, please sign
this letter in the space indicated below and return it to us.

Very truly yours,

[INITIAL COMMITMENT
PARTIES]

By:____________________________
Name:
Title:


Document3
SCHEDULES I-II

[REDACTED]


EXHIBIT A

Second Lien DIP Notes Term Sheet

[SEE EXHIBIT H OF FULLY COMPILED AND EXECUTED RSA]


EXHIBIT B
Equity Conversion Term Sheet

[SEE EXHIBIT J OF FULLY COMPILED AND EXECUTED RSA]

EXHIBIT D to
Provision for Transfer Agreement
The undersigned (Transferee) hereby acknowledges that it has read and understands
the Restructuring Support and Lock-Up Agreement, dated as of __________ (the
Agreement),
1
by and among Energy Future Holdings Corp. (EFH) and its affiliates and
subsidiaries bound thereto, the Consenting Interest Holders, and the Consenting Creditors,
including the transferor to the Transferee of any TCEH Credit Agreement Claims, EFH Interests,
Texas Holdings Interests, TEF Interests, TCEH First Lien Note Claims, TCEH First Lien
Commodity Hedge Claims, TCEH First Lien Interest Rate Swap Claims, EFIH First Lien Note
Claims, EFIH Second Lien Note Claims, EFIH Unsecured Note Claims, EFH Unsecured Note
Claims, TCEH DIP Claims, EFIH First Lien DIP Claims, EFIH Second Lien DIP Claims, or any
other claims against the Debtors (including the Notes Claims, as described on the following
page) (each such transferor, a Transferor), and agrees to be bound by the terms and
conditions thereof to the extent the Transferor was thereby bound, and shall be deemed a
Consenting Creditor or Consenting Interest Holder, as applicable, under the terms of the
Agreement.
The Transferee specifically agrees to be bound by the terms and conditions of the
Agreement and makes all representations and warranties contained therein as of the date of the
Transfer, including the agreement to be bound by the vote of the Transferor if such vote was cast
before the effectiveness of the Transfer discussed herein.
Date Executed:

______________________________________
Name:
Title:

Address:

E-mail address(es):
Telephone:
Facsimile:

1
Capitalized terms not used but not otherwise defined herein shall have the meanings ascribed to such terms
in the Agreement.
Aggregate Amounts Beneficially Owned or Managed on Account of:
EFH Interests (if any)
Texas Holdings Interests (if any)
TEF Interests (if any)
TCEH Credit Agreement Claims (if any) $
TCEH First Lien Note Claims (if any) $
TCEH First Lien Commodity Hedge Claims (if any) $
TCEH First Lien Interest Rate Swap Claims (if any) $
TCEH Second Lien Note Claims (if any) $
TCEH 2015 Note Claims (if any) $

TCEH Senior Toggle Note Claims (if any) $
EFIH First Lien 2017 Note Claims (if any) $
EFIH First Lien 2020 Note Claims (if any) $
EFIH 2021 Note Claims (if any) $
EFIH 2022 Note Claims (if any) $
EFIH Senior Toggle Note Claims (if any) $
EFIH Unexchanged Note Claims (if any) $
EFH 2019 Note Claims (if any) $
EFH 2020 Note Claims (if any) $
EFH Series P Note Claims (if any) $
EFH Series Q Note Claims (if any) $
EFH Series R Note Claims (if any) $
EFH LBO Senior Note Claims (if any) $
EFH LBO Toggle Note Claims (if any) $

Schedule 1 to
Professional Fees and Expenses to Be Paid on the Agreement Effective Date

Type of Advisor Name of Firm Invoiced Amount
TCEH First Lien Noteholders
Primary Counsel Paul Weiss Rifkind
Wharton & Garrison
LLP, pursuant to that
certain engagement letter
dated February 1, 2013

$774,286.00
Local Counsel Young Conaway Stargatt
& Taylor, LLP

$44,403.12
Regulatory Counsel Winstead, P.C., pursuant
to that certain
engagement letter dated
March 19, 2013

$379.62
Financial Advisor Millstein & Co, pursuant
to that certain
February 1, 2013

$4,500,000.00
Tax Advisor PricewaterhouseCoopers
dated March 8, 2013

$95,790.00
Technical and Market Advisor Navigant Consulting,
Inc., pursuant to that
dated February 23, 2013

$3,000.00
EFI H Unsecured Noteholders
Primary Counsel Akin Gump Strauss
Hauer & Feld LLP,
pursuant to that certain
May 24, 2013

$4,508,874.09
Local Counsel Cousins, Chipman &
Brown LLP pursuant to
that certain engagement
letter dated April 25,
2014

$35,000.00

Technical and Market Advisor SAIC Energy
Environment &
Infrastructure, L.L.C.
(n/k/a Leidos
Engineering LLC),
June 17, 2013

$0.00
Tax Advisor Ernst & Young LLP,
statement of work dated
August 23, 2013

$0.00
Regulatory Counsel Duggins Wren Mann &
Romero, LLP pursuant
to that certain
April 28, 2014

$73,589.49
Financial Advisor Centerview Partners,
June 13, 2013

$206,717.43 (advisory)
$5,025,000.00 (transaction)
EFH Unsecureds, EFI H First Liens, EFI H Second Liens (beneficially owned by Fidelity)
Primary Counsel Fried, Frank, Harris,
Shriver & Jacobson
dated August 13, 2013

$956,897.13
Local Counsel [TBD]

$0.00
Regulatory Counsel [TBD]

$0.00
Financial Advisor Perella Weinberg
Partners, pursuant to that
dated October 16, 2013

$0.00
Consenting Non-Fidelity EFI H First Liens
Primary Counsel

Bingham
McCutchen LLP
as of April 27, 2014

$200,000.00
Local Counsel [TBD]

$0.00
I nterest Holders
Primary Counsel Wachtell, Lipton, Rosen,
& Katz, pursuant to that
$9,000,000.00

dated March 3, 2013

Local Counsel Morris, Nichols, Arsht &
Tunnell

$1,200.000.00
Regulatory Counsel [TBD]

$0.00
Financial Advisor Blackstone Advisory
Group L.P., pursuant to
that certain engagement
letter dated March 28,
2013

$8,398,939.90

Schedule 2 to
Individual TCEH First Lien Creditor Advisor
TCEH First Lien Creditor Name of Firm
Apollo OMelveney & Myers LLP, as primary
counsel, pursuant to that certain engagement
letter dated January 6, 2014
Cadwalader, Wickersham & Taft LLP, as
counsel with respect to certain regulatory
matters, pursuant to that certain engagement
letter dated December 26, 2013
Moelis & Company, as financial advisor,
pursuant to that certain engagement letter dated
December 20, 2013
Oaktree

Debevoise & Plimpton LLP, as primary
counsel
Centerbridge

Schulte Roth & Zabel LLP, as primary counsel


Schedule 3 to
1. Motion of Energy Future Holdings Corp., et. al., for Entry of an Order Directing Joint
Administration of the Debtors Chapter 11 Cases
2. Motion of Texas Competitive Electric Holdings Company LLC, et. al., for Entry of
Interim and Final Orders (A) Approving Postpetition Financing, (B) Granting Liens and
Providing Superpriority Administrative Expense Claims, (C) Granting Adequate
Protection, (D) Modifying the Automatic Stay, and (E) Scheduling a Final Hearing
3. Motion of Texas Competitive Electric Holdings Company LLC, et al., for Entry of an
Order Authorizing the TCEH Debtors to File Under Seal the Certain Fee Letter Related
to Proposed Debtor-In-Possession Financing
4. Motion of the TCEH Debtors for Entry of Interim and Final Orders (A) Authorizing Use
of Cash Collateral, (B) Granting Adequate Protection, (C) Modifying the Automatic Stay,
and (D) Scheduling a Final Hearing
5. Motion of Energy Future Intermediate Holding Company LLC and EFIH Finance, Inc.,
for Entry of Interim and Final Orders (A) Approving Postpetition Financing, (B)
Authorizing the Use of Cash Collateral, (D) Granting Adequate Protection, (E)
Authorizing the Repayment of Prepetition Debt, (F) Determining the Value of Secured
Claims, (G) Modifying the Automatic Stay, and (H) Scheduling a Final Hearing
6. Motion of Energy Future Intermediate Holding Company LLC and EFIH Finance, Inc.
for Entry of an Order Authorizing the EFIH Debtors to File Under Seal the Certain Fee
Letter Related to Proposed Debtor-In-Possession Financing
7. Motion of Energy Future Holdings Corp., et al., for Entry of Interim and Final Orders
Authorizing the Debtors to (A) Pay Certain Prepetition Wages, Salaries, Reimbursable
Employee Expenses, and Other Compensation, (B) Pay and Honor Employee and Retiree
Medical and Similar Benefits, and (C) Continue Employee Compensation and Employee
and Retiree Benefit Programs
8. Motion of Energy Future Holdings Corp., et al., for Entry of an Order (A) Authorizing
the Debtors to (I) Continue Using Their Existing Cash Management System, (II)
Maintain Existing Bank Accounts and Business Forms, and (III) Continue Using Certain
Overnight Investment Accounts; (B) Authorizing Continued Intercompany Transactions
and Netting of Intercompany Claims; and (C) Granting Postpetition Intercompany Claims
Administrative Expense Priority
9. Motion of Energy Future Holdings Corp., et al., for Entry of (A) an Order Authorizing
the Debtors to (I) Maintain and Administer Customer Programs, (II) Honor Prepetition
Obligations Related Thereto, (III) Pay Certain Expenses on Behalf of Certain
Organizations, (IV) Fix Deadlines to File Proofs of Claim for Certain Customer Claims,
and (V) Establish Procedures for Notifying Customers of Commencement of the Debtors
Chapter 11 Cases, Assumption of Customer Agreements, and the Bar Dates for Customer
Claims and (B) an Order Authorizing the Debtors to Assume Customer Agreements

Authorizing the Debtors to Pay Prepetition Critical Vendor Claims
Authorizing the Debtors to (A) Grant Administrative Expense Priority to All Undisputed
Obligations for Goods and Services Ordered Prepetition and Delivered Postpetition and
Satisfy Such Obligations in the Ordinary Course of Business, and (B) Pay Prepetition
Claims of Shippers, Warehousemen, and Materialmen
12. Motion of Energy Future Holdings Corp., et al., For Entry of Interim and Final Orders
Authorizing the Debtors to (A) Continue Performing Under Prepetition Hedging and
Trading Arrangements, (B) Pledge Collateral and Honor Obligations Thereunder, and (C)
Enter Into and Perform Under Trading Continuation Agreements and New Postpetition
Hedging and Trading Arrangement
Determining Adequate Assurance of Payment for Future Utility Services
14. Motion of Energy Future Holdings Corp., et al., for Entry of an Order Authorizing the
Debtors to Assume Certain Transmission and Distribution Service Agreements
15. Motion of Energy Future Holdings Corp., et al., for Entry of an Order Authorizing the
Debtors to Pay Certain Prepetition Taxes and Fees
16. Application of Energy Future Holdings Corp., et al., for Entry of an Order Approving the
Retention and Appointment of Epiq Bankruptcy Solutions, LLC as the Claims and
Noticing Agent for the Debtors
17. Motion of Energy Future Holdings Corp., et. al., for Entry of an Order Authorizing the
Debtors to File a Consolidated List of Creditors in Lieu of Submitting a Separate Mailing
Matrix for Each Debtor
18. Motion of Energy Future Holdings Corp., et. al., for Entry of an Order Authorizing the
Debtors to Assume Certain ERCOT Participation Agreements
1

1
Will not be heard at first day hearing.

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