Calpine emerges from bankruptcy

San Jose, CA, & Houston, TX, Feb. 1, 2008 — Calpine Corp. announced that it has successfully emerged from Chapter 11 bankruptcy protection. The company officially concluded its Chapter 11 reorganization after meeting all statutory requirements of the company’s Sixth Amended Joint Plan of Reorganization, including successfully closing its $7.3 billion exit financing facility that includes a one-year, $300 million bridge facility that is expected to be paid by the end of the first quarter. Calpine’s plan was confirmed by the United States Bankruptcy Court for the Southern District of New York in an order entered on December 19, 2007.

Calpine’s stock is expected to begin “regular way” trading on the New York Stock Exchange on or about February 5, 2008 under the ticker symbol CPN.

“This is a wonderful day for all of us at the new Calpine… We are very proud of what we have been able to accomplish over the past two years… We are well positioned for future success, with a healthy balance sheet and a $7.3 billion exit financing facility,” said Robert P. May, Calpine’s CEO.

The court approved Calpine’s new nine-member board of directors. The directors are:

* William J. Patterson — chairman of the board;
* Frank Cassidy — member, compensation committee;
* Kenneth Derr — chair, compensation committee;
* Robert C. Hinckley — member, audit committee and member, nominating and governance committee;
* Robert P. May — CEO;
* David Merritt — chair, audit committee;
* W. Benjamin Moreland — member, audit committee;
* Denise M. O’Leary — chair, nominating and governance committee;
* J. Stuart Ryan — member, compensation committee.

Under the plan, Calpine intends to issue a total of 485 million shares of reorganized Calpine common stock to holders of allowed claims. The reorganized Calpine common stock will trade on the New York Stock Exchange under the ticker symbol CPN. Calpine anticipates that it will make initial distributions under the plan to holders of allowed claims and interests on or before February 10, 2008. In addition to the 485 million shares, Calpine will reserve 15 million shares for distribution pursuant to the terms of Calpine’s management and director equity incentive programs, which will be implemented pursuant to the terms of the plan.

In its first distribution, Calpine anticipates distributing approximately 423 million shares of reorganized Calpine common stock, each with an imputed value of $17.36 based upon a $8.7 billion reorganized equity value and the face value of the exit financing.

Calpine estimates in connection with its first distribution that: (1) general unsecured creditors will receive approximately 84.8 percent of their allowed claims for principal and pre-petition interest; (2) holders of the 7.625 percent Senior Notes Due 2006, 7.75 percent Senior Notes Due 2009, 7.875 percent Senior Notes Due 2008, 8.75 percent Senior Notes Due 2007, and 10.5 percent Senior Notes Due 2006 (Senior Notes) will receive approximately 100.0 percent of their allowed claims for principal and pre-petition interest; and (3) holders of the 7.75 percent Contingent Convertible Notes Due 2015 (Subordinated Notes) will receive approximately 42.0 percent of their allowed claims for principal and pre-petition interest.

In connection with its first distribution, Calpine also intends to set aside 62 million shares of reorganized Calpine common stock on account of disputed unsecured claims. As claims are resolved, Calpine will make further distributions of reorganized Calpine common stock on a periodic basis in accordance with the terms of the plan. Based upon the $18.95 billion total enterprise value of Calpine set forth in the plan and Calpine’s current litigation-risk assessment of allowed claims, Calpine currently estimates that: (1) general unsecured creditors will ultimately recover approximately 99.9 percent of their allowed claims for principal and pre-petition interest; (2) holders of the Senior Notes will ultimately recover approximately 100.0 percent of their allowed claims for principal and pre-petition interest; and (3) holders of the Subordinated Notes will ultimately recover approximately 75.0 percent of their allowed claims for principal and pre-petition interest.

In accordance with the plan, post-petition interest on the Senior Notes and certain related claims will be held in escrow pending the resolution of the Intercreditor Subordination Dispute between the holders of the Senior Notes and holders of the Subordinated Notes described in detail in the plan. The recoveries for the holders of the Senior Notes and holders of the Subordinated Notes under the plan depend, in part, on the resolution of the Intercreditor Subordination Dispute. Calpine’s estimates regarding the ultimate recoveries under the plan for the holders of the Subordinated Notes assume that the holders of the Senior Notes will prevail in the Intercreditor Subordination Dispute, although Calpine has not yet taken any position with respect to such dispute.

As part of the Plan, Calpine’s old common stock will be cancelled and holders of the old common stock will receive warrants to purchase new Calpine common stock. These warrants will be for an aggregate of approximately 48.5 million shares of new Calpine common stock and will have an exercise price of $23.88 per share. Cashless exercises will not be permitted. The warrants will expire on August 25, 2008. The warrants will be distributed to the holders of the old Calpine common stock pro rata based on the number of shares of old Calpine common stock held at the time of cancellation. Fractional warrants will not be issued.

For related articles on the Calpine bankruptcy and recovery, please read these articles:

Court allows Calpine to proceed with $5 billion replacement DIP financing

Calpine gets approval to sell power plant; moves forward with bankruptcy recovery plan

Calpine sells excess inventory

Calpine sells interest in Wisconsin power plant

Calpine to sell interest in Cali energy center

Court OKs Calpine power plant sale

Calpine repays $645 million of its 9 5/8% First Priority Senior Secured Notes due 2014

Calpine Power Income Fund announces departure of CFO Geoff Krause

Calpine completes sale of Mexican power plant

Calpine to cut 775 jobs; announces plans to sell non-core power plants

Calpine sells interest in Mexican power plant; general counsel departs

Calpine shifting executive staff to go forward with restructuring plan

Calpine closes $2 billion DIP financing

Calpine declares compensation figures for board; purchases geothermal plants; appoints new board member

Calpine finalizes collateral structure for $2 billion DIP facility

Calpine files to reject two power plant lease agreements

Calpine to eliminate 300 jobs, sell non-core business

Calpine Power Income Fund and its manager in dispute

Default avoided on King City Project: Calpine Power Income Fund; Scott Davido named CFO of Calpine

Calpine receives court approval of $2 billion DIP financing

Calpine announces departure of member of board

Calpine terminates tender offer for outstanding first priority senior secured notes

Calpine receives court approval of first day motions

Calpine files for bankruptcy

Calpine given time to repay debts, but not much

Calpine’s common stock to cease trading on NYSE

Fitch says Calpine exposure does not adversely affect public power sector

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