Item 2.03 below
is hereby incorporated by reference in this Item 1.01.
|
|
ITEM 2.03 — CREATION
OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE
SHEET ARRANGEMENT OF A REGISTRANT
|
On
October 21, 2009, Calpine issued approximately $1.2 billion in aggregate
principal amount of 7.25% senior secured notes due 2017 in a private placement
for a like principal amount of term loans under the Indenture. This summary of
the terms of the Indenture and the Notes is qualified in its entirety by
reference to the Indenture, a copy of which (including the form of the Notes) is
attached as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated
by reference herein.
The Notes
bear interest at 7.25% payable on April 15 and October 15 of each year
beginning on April 15, 2010. Calpine will make each interest payment to the
holders of record on the April 1 and October 1 immediately preceding the
applicable interest payment date. The Notes will mature on October 15, 2017. The
Notes are guaranteed by each of Calpine’s current and future domestic
subsidiaries that are a borrower or guarantor under the First Lien Credit
Facility and rank equally in right of payment with all of Calpine’s and the
guarantors’ other existing and future senior indebtedness, and will be
effectively subordinated in right of payment to all existing and future
liabilities of Calpine and its subsidiaries that do not guarantee the Notes. The
Notes are secured equally and ratably with indebtedness under Calpine’s First
Lien Credit Facility by a first-priority lien, subject to certain exceptions and
permitted liens, on substantially all of Calpine’s and certain of the
guarantors’ existing and future assets.
Subject
to certain qualifications and exceptions, the Indenture will, among other
things, limit Calpine’s ability and the ability of the guarantors
to:
|
•
|
incur
or guarantee additional first lien
indebtedness;
|
|
•
|
enter
into commodity hedge agreements;
|
|
•
|
enter
into sale and leaseback
transactions;
|
|
•
|
create
liens; and
|
|
•
|
consolidate,
merge or transfer all or substantially all of Calpine’s assets and the
assets of Calpine’s restricted subsidiaries on a combined
basis.
|
On or
after October 15, 2013, Calpine may on any one or more occasions redeem all or a
part of the Notes, upon not less than 30 nor more than 60 days’ notice, at the
redemption prices set forth in the Indenture, plus any accrued and unpaid
interest. Calpine may also redeem any of the Notes at any time prior
to October 15, 2013, at a price equal to 100% of the aggregate principal
amount thereof, plus a “make-whole” premium and accrued and unpaid interest.
Prior to October 15, 2012, Calpine may redeem up to 35% of the aggregate
principal amount of the Notes with the net cash proceeds of
certain
equity
offerings, at a price equal to 107.25% of the aggregate principal amount
thereof, plus accrued and unpaid interest. In addition, prior to October 15,
2013, but not more than once in any 12-month period, Calpine may redeem up to
10% of the original aggregate principal amount of the Notes at a redemption
price of 103% of the aggregate principal amount thereof, plus accrued and unpaid
interest.
If a
Change of Control Triggering Event (as defined in the Indenture) occurs, each
holder of the Notes will have the right to require Calpine to repurchase all or
any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof)
of that holder’s Notes pursuant to a Change of Control Offer (as defined in
the Indenture) on the terms set forth in the Indenture in cash equal to
101% of the aggregate principal amount, plus accrued and unpaid
interest.
If an
event of default arises from certain events of bankruptcy or insolvency, all
outstanding Notes will become due and payable immediately without further action
or notice. If other events of default arise, including failure to pay principal
or interest on a timely basis, failure to comply with the agreements under the
Indenture or related security documents, default under or acceleration of
certain other indebtedness, failure to pay certain judgments, and repudiation or
unenforceability of obligations under the security documents or the guarantees,
subject to certain limitations including, if applicable, the giving of notice or
the expiration of any grace or cure period, or both, the trustee or holders of
at least 25% of the aggregate principal amount of the outstanding Notes may
declare the Notes to be due and payable immediately.
ITEM 8.01 — OTHER
EVENTS
On
October 21, 2009, Calpine announced the closing of the offering of the Notes
described in Item 2.03 of this Current Report on Form 8-K. A copy of the press
release is included as Exhibit 99.1 hereto and incorporated by reference
herein.
ITEM 9.01 — FINANCIAL
STATEMENTS AND EXHIBITS
(d) Exhibits
|
Exhibit No.
|
Description
|
|
|
4.1
|
Indenture,
dated October 21, 2009, among Calpine Corporation, the guarantors party thereto and
Wilmington Trust Company, as trustee, including the form of the
Notes.
|
|
|
99.1
|
Calpine
Corporation Press Release dated October 21,
2009.
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
CALPINE
CORPORATION
|
By:
|
/s/ ZAMIR
RAUF
|
|||
|
Zamir
Rauf
|
||||
|
Executive
Vice President and
|
||||
|
Chief
Financial Officer
|
||||
|
Date: October
23, 2009
|
EXHIBIT
INDEX
|
Exhibit No.
|
Description
|
|
|
4.1
|
Indenture,
dated October 21, 2009, among Calpine Corporation, the guarantors party thereto and
Wilmington Trust Company, as trustee, including the form of the
Notes.
|
|
|
99.1
|
Calpine
Corporation Press Release dated October 21,
2009.
|