UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 10, 2005
CALPINE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
(State or Other Jurisdiction of Incorporation)
Commission File Number: 001-12079
I.R.S. Employer Identification Number: 77-0212977
50 West San Fernando Street
San Jose, California 95113
Telephone: (408) 995-5115
(Address of principal executive offices and telephone number)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 -- ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On November 10, 2005, Calpine Corporation's ("Calpine") indirect, wholly
owned subsidiaries Calpine Energy Services, L.P. ("CES"), and Calpine Merchant
Services Company, Inc. ("CMSC") entered into a Trading Master Agreement (the
"Trading Agreement") with CalBear Energy LP ("CalBear"). Pursuant to the terms
of the Trading Agreement, CES has the right to enter into certain power and gas
trades (each a "Credit Enhancement Trade") with CalBear as a credit sleeve with
certain approved counterparties. The Credit Enhancement Trades are subject to
certain limitations on types and quantities of trades (including a $350 million
limit on CalBear's gross receivables from third parties in connection with the
sleeved trades).
The Trading Agreement will terminate upon a termination of the Master
Transaction Agreement dated September 7, 2005, by and among Calpine, CMSC, CES,
CalBear and The Bear Stearns Companies Inc. (the "Master Transaction Agreement")
and can be terminated by any party for covenant defaults and other usual and
customary defaults, with negotiated cure periods.
The indemnification obligations of the Master Transaction Agreement apply
to breaches of covenants and agreements contained in the Trading Agreement and
otherwise apply to the transactions contemplated by the Trading Agreement. In
addition, CES and CMSC, jointly and severally, indemnify CalBear and its
affiliates against any damages resulting from breach of covenant or agreement,
violation of laws, and certain third party claims.
ITEM 8.01 -- OTHER MATTERS
As previously reported in Calpine's Current Report on Form 8-K dated
September 7, 2005, filed with the SEC on September 13, 2005, on September 7,
2005, Calpine and CES entered into the Master Transaction Agreement with Bear
Stearns pursuant to which the parties agreed to create a new energy marketing
and trading venture. The information set forth in such Form 8-K is incorporated
by reference. On October 31, 2005, required regulatory approvals were received
and, on November 10, 2005, the parties closed the transactions contemplated by
the Master Transaction Agreement. In connection with the closing, CMSC and
CalBear became parties to the Master Transaction Agreement. In addition, the
Trading Agreement described in Item 1.01 above was executed and additional
agreements were executed including an Agency and Services Agreement by and among
CMSC and CalBear, pursuant to which CMSC will act as CalBear's exclusive agent
for gas and power trading, and an ISDA Master Agreement, Schedule, and
applicable annexes between CES and CalBear to effectuate the Credit Enhancement
Trades.
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/ Charles B. Clark, Jr.
------------------------------------
Charles B. Clark, Jr.
Senior Vice President, Controller and
Chief Accounting Officer
Date: November 17, 2005