San Jose, CA, Jan. 26, 2006 — Calpine Corp. announced that the U.S. Bankruptcy Court for the Southern District of New York has granted final approval for a $2 billion debtor-in-possession (DIP) credit facility to fund operations during Calpine’s chapter 11 restructuring and to retire certain obligations at The Geysers. The bankruptcy court granted Calpine interim approval to use up to $500 million of the facility during a hearing of first day motions held December 21, 2005.
Calpine filed for bankruptcy on December 20, 2005.
The DIP credit facility will be provided to the company by Deutsche Bank and Credit Suisse as co-lead arrangers. The facility is expected to close within the next 30 days and will consist of:
* $1 billion revolving credit facility, priced at LIBOR plus 225 basis points;
* $350 million first-priority term loan, priced at LIBOR plus 225 basis points;
* $650 million second-priority term loan, priced at LIBOR plus 450 basis points.
The DIP facility will remain in place until the earlier of an effective plan of reorganization or December 20, 2007. The DIP facility is secured by liens on all of Calpine’s unencumbered assets and junior liens on all of its encumbered assets.
Robert P. May, Calpine’s CEO, said the ruling will allow Calpine to provide “ample liquidity to continue to meet the needs of our customers and the markets we serve.”
