Calpine Prices Rocky Mountain & Riverside Secured Term Loans

Calpine Corporation's wholly owned subsidiaries, Rocky Mountain Energy Center, LLC and Riverside Energy Center, LLC, have priced new secured institutional term loans for the refinancing of its Rocky Mountain (Weld County, Colo.) and Riverside (Beloit, Wisc.) Energy Centers. Both of the approximately 600-megawatt natural gas-fired power plants recently entered commercial operations. The refinancing, which is expected to close on June 22, 2004, consists of $661.5 million of floating rate secured institutional term loans due 2011, priced at LIBOR plus 425 basis points and issued at a discount to par of 99.5%.

Net proceeds from the loans, after transaction costs and fees, will be used to pay final construction costs and refinance amounts outstanding under the $250 million non-recourse project financing for the Rocky Mountain facility, and the $230 million non-recourse project financing for the Riverside facility. The balance of approximately $160 million, will be returned to Calpine and will be used for general corporate purposes. In addition, approximately $40 million in cash and $55 million in letters of credit will be returned to Calpine as the result of the elimination of certain reserves and letters of credit associated with the original non-recourse project financings.

The institutional term loans are secured by the power plants, and the lenders' recourse is limited to such security. None of the indebtedness will be guaranteed by Calpine Corporation.

The secured institutional term loans will be placed in the institutional term loan market. The refinancing is subject to certain conditions, including the execution of definitive documentation.
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