Calpine Commences Preferred Shares Offering

Calpine Corporation's indirect subsidiary, CCFC Preferred Holdings, LLC (CCFC Holdings), intends to commence a private placement of Redeemable Preferred Shares due 2011. Proceeds from the offering of the Redeemable Preferred Shares, which are expected to be $400 million, will ultimately be used as permitted by Calpine's existing bond indentures.

The Redeemable Preferred Shares have not been registered under the Securities Act of 1933, as amended, and may not be offered in the United States or any state absent registration or an applicable exemption from registration requirements. The Redeemable Preferred Shares will be offered in a private placement in the United States under Section 4(2) and Regulation D under the Securities Act of 1933.