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Calpine Settles Largest Remaining Claim in Bankruptcy Estate

Achieves Significant Progress toward Closure of Bankruptcy Case

HOUSTON, Jun 02, 2011 (BUSINESS WIRE) -- Calpine Corporation (NYSE:CPN), which emerged from bankruptcy in January 2008, today announced the settlement of the only significant claim remaining from the bankruptcy proceeding. The settlement with holders of certain Class 12 claims is subject to Bankruptcy Court approval, which is expected to be obtained in the next several weeks.

The settlement will be funded by the sale of a portion of the shares of Calpine stock held in reserve by the Company to satisfy bankruptcy claims that had not been satisfied as of emergence. The balance of the reserve shares, if any, after all claims are settled will be distributed to unsecured creditors. The approximately 44 million shares currently held in the reserve were included in the Company's 486 million weighted average shares outstanding as of March 31, 2011, and sale or distribution of these shares does not represent the issuance of new or additional shares. The settlement will have no impact on the Company's earnings or cash flow.

"Today's settlement marks a significant milestone in our effort to conclude the Company's bankruptcy case," said Zamir Rauf, Calpine's Chief Financial Officer. "Upon approval of this settlement and the associated sale of shares, our goal will be to resolve the few remaining outstanding claims and distribute the remaining reserve shares to the unsecured creditors, officially closing this chapter in the Company's history."

About Calpine

Founded in 1984, Calpine Corporation is a major U.S. power company, currently capable of delivering approximately 28,000 megawatts of clean, cost-effective, reliable and fuel-efficient power from its 92 operating plants to customers and communities in 20 U.S. states and Canada. Calpine Corporation is committed to helping meet the needs of an economy that demands more and cleaner sources of electricity. Calpine owns, leases and operates primarily low-carbon, natural gas-fired and renewable geothermal power plants. Using advanced technologies, Calpine generates power in a reliable and environmentally responsible manner for the customers and communities it serves. Please visit our website at www.calpine.com for more information.

Forward-Looking Information

In addition to historical information, this release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as "believe," "intend," "expect," "anticipate," "plan," "may," "will" and similar expressions identify forward-looking statements. Such statements include, among others, those concerning expected financial performance and strategic and operational plans, as well as assumptions, expectations, predictions, intentions or beliefs about future events. You are cautioned that any such forward-looking statements are not guarantees of future performance and that a number of risks and uncertainties could cause actual results to differ materially from those anticipated in the forward-looking statements. Please see the risks identified in this release or in Calpine's reports and registration statements filed with the Securities and Exchange Commission, including, without limitation, the risk factors identified in its Annual Report on Form 10-K for the year ended December 31, 2010, and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2011. These filings are available by visiting the Securities and Exchange Commission's website at www.sec.gov or Calpine's website at www.calpine.com. Actual results or developments may differ materially from the expectations expressed or implied in the forward-looking statements, and Calpine undertakes no obligation to update any such statements.

SOURCE: Calpine Corporation

Calpine Corporation
Media Relations:
Norma F. Dunn, 713-830-8883
Investor Relations:
Christine Parker, 713-830-8775