$200,000,000
CALPINE CORPORATION
8 3/4% Senior Notes
PURCHASE AGREEMENT
July 1, 1997
CREDIT SUISSE FIRST BOSTON CORPORATION
As Representative of the Several Purchasers,
00 Xxxxxxx Xxxxxx,
Xxx Xxxx, X.X. 00000
Dear Sirs:
1. Introductory. Calpine Corporation, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several initial purchasers named in Schedule A hereto (the
"Purchasers") U.S.$200,000,000 principal amount of its 8 3/4% Senior Notes Due
2007 (the "Offered Securities") to be issued under an indenture dated as of July
8, 1997 (the "Indenture"), between the Company and The Bank of New York (the
"Trustee"), on a private placement basis pursuant to an exemption under Section
4(2) of the United States Securities Act of 1933 (the "Securities Act").
Holders (including subsequent transferees) of the Offered Securities
will have the registration rights set forth in the Registration Rights Agreement
of even date herewith (the "Registration Rights Agreement"), among the Company
and the Purchasers. Pursuant to the Registration Rights Agreement the Company
has agreed to file with the Securities and Exchange Commission (the
"Commission") (i) a registra tion statement (the "Exchange Offer Registration
Statement") under the Securities Act registering the offering of senior secured
notes (the "Exchange Securities") identical in all material respects to the
Offered Securities (except that the Exchange Securities will not contain terms
with respect to transfer restrictions) to be offered in exchange for the Offered
Securities (the "Exchange Offer") and (ii) under certain circumstances, a shelf
registration statement pursuant to Rule 415 under the Securities Act (the "Shelf
Registration Statement").
The Company hereby agrees with the Purchasers as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Purchasers that:
(a) A preliminary offering circular has been prepared and a
final offering circular relating to the Offered Securities will be
prepared by the Company. Such preliminary offering circular and
offering circular, as supplemented as of the date of this Agreement,
together with the documents listed in Schedule B hereto and any other
document approved by the Company for use in connection with the
contemplated resale of the Offered Securities, are hereinafter
collectively referred to as the "Offering Document". On the date of
this Agreement,
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the perliminary offering circular does not include and
the final offering circular in the form used by the Purchasers to
confirm sales and on the Closing Date will not include any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Offering Document based upon
written information furnished to the Company by any Purchaser through
Credit Suisse First Boston Corporation ("CSFB") specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(b). Except as disclosed in the
Offering Document, on the date of this Agreement, the Company's Annual
Report on Form 10-K most recently filed with the Commission and all
subsequent reports (collectively, the "Exchange Act Reports") which
have been filed by the Company with the Commission or sent to stock
holders pursuant to the Securities Exchange Act of 1934 (the "Exchange
Act") do not include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading. Such documents, when they were filed with the Commission,
conformed in all material respects to the requirements of the Exchange
Act and the rules and regulations of the Commission thereunder. The
preceding sentence does not apply to statements in or omissions from
the Offering Document based upon written information furnished to the
Company by any Purchaser through CSFB specifically for use therein, it
being understood and agreed that the only such information is that
described as such in Section 7(b).
(b) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Offering Document; and the
Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, except to the extent that the failure to be so qualified
or be in good standing would not have a material adverse effect on the
Company and its Subsidiaries (as defined below), taken as a whole.
(c) Each Subsidiary of the Company (i) other than those
Subsidiaries specified in clause (ii) of this paragraph (2)(c) has been
duly incorporated, is validly existing as a corpora tion in good
standing under the laws of the jurisdiction of its incorporation, and
has corporate power and authority to own its property and to conduct
its business as described in the Offering Document or (ii) that is not
a corporation is a limited partnership, has been duly formed and is
validly existing as a limited partnership in good standing under the
laws of the jurisdiction of its formation, and has full power and
authority to own its property and to conduct its business as described
in the Offering Document; and, in either case, is duly qualified to
transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
required such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on the Company and its Subsidiaries, taken as a whole;
and the Company is not a general partner in any partnership. As used
herein, the term "Subsidiary" shall have the meaning ascribed to it in
the Indenture.
(d) The Indenture has been duly authorized by the Company; the
Offered Securities have been duly authorized by the Company; and when
the Offered Securities are delivered and paid for pursuant to this
Agreement and the Indenture on the Closing Date (as defined below), the
Indenture will have been duly executed and delivered (assuming due
authorization, execution and delivery by the Trustee), such Offered
Securities will have been duly executed, authenticated, issued and
delivered (assuming authentication by the Trustee in accordance with
the provisions of the Indenture) and will conform to the description
thereof contained in
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the Offering Document and the Indenture and such
Offered Securities will constitute valid and legally binding
obligations of the Company (and the Offered Securities will be entitled
to the benefits in the Indenture), enforceable in accordance with their
terms, except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(e) Except as disclosed in the Offering Document, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Purchaser for a brokerage commission, finder's fee or other like
payment with respect to this Offering.
(f) The Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and (assuming due
authorization, execution and delivery by the Purchasers) constitutes a
valid and binding agreement of the Company, enforceable in accor dance
with its terms except as (i) the enforceability thereof may be limited
by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general ap
plicability.
(g) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation of the transactions contemplat ed by this
Agreement in connection with the issuance and sale of the Offered
Securities by the Company, except such as may be required by (i) the
securities or Blue Sky laws of the various states in connection with
the offer and sale of the Offered Securities and (ii) the securities or
Blue Sky laws of the various states and the Securities Act in
connection with the offer of the Exchange Securities.
(h) The execution, delivery and performance of the Indenture,
this Agreement, the Registration Rights Agreement, and the issuance and
sale of the Offered Securities and compliance with the terms and
provisions thereof will not result in a breach or violation of any of
the terms and provisions of, or constitute a default under, any
statute, any rule, regulation or order of any governmental agency or
body or any court, domestic or foreign, having jurisdiction over the
Company or any Subsidiary of the Company or any of their properties, or
any agreement or instrument to which the Company or any such Subsidiary
is a party or by which the Company or any such Subsidiary is bound or
to which any of the properties of the Company or any such Subsidiary is
subject, or the charter or by-laws of the Company or any such
Subsidiary, and the Company has full power and authority to authorize,
issue and sell the Offered Securities as contemplated by this
Agreement.
(i) This Agreement has been duly authorized, executed
and delivered by the Company.
(j) Except as disclosed in the Offering Document, the Company
and its Subsidiaries have good and marketable title to all real
properties and all other properties and assets owned by them, in each
case free from liens, encumbrances and defects that would materially
affect the value thereof or materially interfere with the use made or
to be made thereof by them; and except as disclosed in the Offering
Document, the Company and its Subsidiaries hold any leased real or
personal property under valid and enforceable leases with no exceptions
that would materially interfere with the use made or to be made thereof
by them.
(k) The Company and its Subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the
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business now operated by them and have not received any notice of
proceedings relating to the revocation or modification of any such
certificate, authority or permit that, if determined adversely to the
Company or any of its Subsidiaries, would individually or in the
aggregate have a material adverse effect on the Company and its
Subsidiaries taken as a whole.
(l) No labor dispute with the employees of the Company or any
Subsidiary exists or, to the knowledge of the Company, is imminent that
might have a material adverse effect on the Company and its
Subsidiaries taken as a whole.
(m) Except as disclosed in the Offering Document, neither the
Company nor any of its Subsidiaries is in violation of any statute, any
rule, regulation, decision or order of any governmental agency or body
or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "environmen tal laws"), owns or
operates any real property contaminated with any substance that is
subject to any environmental laws, is liable for any off-site disposal
or contamination pursuant to any environmental laws, or is subject to
any claim relating to any environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a material adverse effect on the Company and its
Subsidiaries taken as a whole; and the Company is not aware of any
pending investigation which might lead to such a claim.
(n) Except as disclosed in the Offering Document, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its Subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its Subsidiaries, would
individually or in the aggregate have a material adverse effect on the
condition (financial or other), business, properties or results of
operations of the Company and its Subsidiaries taken as a whole, or
would materially and adversely affect the ability of the Company to
perform its obligations under the Indenture or this Agreement, or which
are otherwise material in the context of the sale of the Offered
Securities; and no such actions, suits or proceedings are threatened
or, to the Company's knowledge, contemplated.
(o) The financial statements included in the Offering Document
present fairly the financial position of the Company and its
consolidated Subsidiaries as of the dates shown and their results of
operations and cash flows for the periods shown, and, except as
otherwise disclosed in the Offering Document, such financial statements
have been prepared in confor mity with the generally accepted
accounting principles in the United States applied on a consistent
basis and the assumptions used in preparing the pro forma financial
statements included in the Offering Document provide a reasonable basis
for presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma columns therein reflect the proper application of those
adjustments to the corresponding historical financial statement
amounts.
(p) The statistical and market-related data (other than
market-related data and statistical data provided by the Company)
included in the Offering Document are based on or derived from sources
which the Company believes to be reliable and accurate, it being
understood, however, that the Company has conducted no independent
investigation of the accuracy thereof.
(q) Except as disclosed in the Offering Document, since the
date of the latest audited financial statements included in the
Offering Document there has been no material adverse change, nor any
development or event involving a prospective material adverse change,
in the
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condition (financial or other), business, properties or results of
operations of the Company and its Subsidiaries taken as a whole, and,
except as disclosed in or contemplated by the Offering Document, there
has been no dividend or distribution of any kind declared, paid or made
by the Company on any class of its capital stock.
(r) The Company is not an open-end investment company, unit
investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the United States
Investment Company Act of 1940 (the "Investment Company Act"), nor is
it a closed-end investment company required to be registered, but not
registered, thereunder; and the Company is not and, after giving effect
to the offering and sale of the Offered Securities and the application
of the proceeds thereof as described in the Offering Document, will not
be an "investment company" as defined in the Investment Company Act.
(s) No securities of the same class (within the meaning of
Rule 144A(d)(3) under the Securities Act) as the Offered Securities are
listed on any national securities exchange registered under Section 6
of the Exchange Act or quoted in a U.S. automated inter-dealer
quotation system.
(t) The offer and sale of the Offered Securities by the
Company to the several Purchasers in the manner contemplated by this
Agreement will be exempt from the registra tion requirements of the
Securities Act by reason of Section 4(2) thereof; and it is not
necessary to qualify the Indenture in respect of the Offered Securities
under the United States Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act").
(u) Neither the Company, nor any of its affiliates (as defined
in Rule 501(b) of Regulation D under the Securities Act), nor any
person acting on its or their behalf (i) has, within the six-month
period prior to the date hereof, offered or sold in the United States
or to any U.S. person (as such terms are defined in Regulation S under
the Securities Act) the Offered Securities or any security of the same
class or series as the Offered Securities or (ii) has offered or will
offer or sell the Offered Securities (A) in the United States by means
of any form of general solicitation or general advertising within the
meaning of Rule 502(c) under the Securities Act or (B) with respect to
any securities sold in reliance on Rule 903 of Regulation S, by means
of any directed selling efforts within the meaning of Rule 902(b) of
Regulation S. The Company has not entered and will not enter into any
contractual arrange ment with respect to the distribution of the
Offered Securities except for this Agreement.
(v) Neither the Company nor any of its Subsidiaries is (i)
subject to regulation as a "holding company" or a "Subsidiary company"
of a holding company or a "public utility company" under Section 2(a)
of the Public Utility Holding Company Act of 1935 ("PUHCA"), (ii)
subject to regulation under the Federal Power Act, as amended ("FPA"),
other than as contemplated by 18 C.F.R. Sec 292.601(c) or (iii) subject
to any state law or regulation with respect to rates or the financial
or organizational regulation of electric utilities, other than as
contemplated by 18 C.F.R. Sec 292.602(c).
(w) Each of the power generation projects in which the Company
or its Subsidiaries has an interest (the "Projects") which is subject
to the requirements under the Public Utility Regulatory Policies Act of
1978, as amended (16 U.S.C. Sec 796, et seq.), and the regulations of
the Federal Energy Regulatory Commission ("FERC") promulgated
thereunder, as amend ed from time to time, necessary to be a
"qualifying cogeneration facility" and/or a "qualifying small power
production facility" meets such requirements.
(x) The Company is subject to Section 13 or 15(d) of the
Exchange Act.
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3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Purchasers, and the Purchasers agree, severally and not jointly, to purchase
from the Company, at a purchase price of 99.6353% of the principal amount
thereof plus accrued interest from July 8, 1997 to the Closing Date (as
hereinafter defined) the respective principal amount of Offered Securities set
forth opposite the names of the several Purchasers in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities in the form of one or more permanent global securities in
definitive form (the "Global Securities") deposited with the Trustee as
custodian for The Depository Trust Company ("DTC") and registered in the name of
Cede & Co., as nominee for DTC. Interests in any permanent Global Securities
will be held only in book-entry form through DTC, except in the limited
circumstances described in the Offering Document. Payment for the Offered
Securities shall be made by the Purchasers in Federal (same day) funds by
official check or checks or wire transfer to an account previously designated to
CSFB by the Company at a bank acceptable to CSFB at the office of Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP at 10:00 A.M. (New York time), on July 8, 1997, or at
such other time not later than seven full business days thereafter as CSFB and
the Company determine, such time being herein referred to as the "Closing Date",
against delivery to the Trustee as custodian for DTC of the Global Securities
representing all of the Offered Securities. The Global Securities will be made
available for inspection at the above office of Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP at least 24 hours prior to the Closing Date.
4. Representations by Purchasers; Resale by Purchasers.
(a) Each Purchaser severally represents and warrants to the
Company that it is an "accredited investor" within the meaning of Regulation D
under the Securities Act.
(b) Each Purchaser severally acknowledges that the Offered
Securities have not been registered under the Securities Act and may
not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with
Regulation S or pursuant to an exemption from the registration
requirements of the Securities Act. Each Purchaser severally represents
and agrees that it has offered and sold the Offered Securities and will
offer and sell the Offered Securities (i) as part of their distribution
at any time and (ii) otherwise until the later of the commencement of
the offering and the Closing Date, only in accordance with Rule 144A
("Rule 144A") or Rule 903 under the Securities Act. Accord ingly,
neither such Purchaser nor its affiliates, nor any persons acting on
its or their behalf, have engaged or will engage in any directed
selling efforts with respect to the Offered Securities, and such
Purchaser, its affiliates and all persons acting on its or their behalf
have complied and will comply with the offering restrictions
requirement of Regulation S. Terms used in this paragraph (b) have the
meanings given to them by Regulation S.
(c) Each Purchaser severally agrees that it and each of its
affiliates has not entered and will not enter into any contractual
arrangement with respect to the distribution of the Offered Securities
except for any such arrangements with the other Purchasers or
affiliates of the other Purchasers or with the prior written consent of
the Company.
(d) Each Purchaser severally agrees that it and each of its
affiliates will not offer or sell the Offered Securities by means of
any form of general solicitation or general advertising, within the
meaning of Rule 502(c) under the Securities Act, including, but not
limited to (i) any advertisement, article, notice or other
communication published in any newspaper, magazine or similar media or
broadcast over television or radio, or (ii) any seminar or meeting
whose attendees have been invited by any general solicitation or
general advertising. Each Purchaser
6
severally agrees, with respect to resales made in reliance on Rule 144A
of any of the Offered Securities, to deliver either with the
confirmation of such resale or otherwise prior to settlement of such
resale a notice to the effect that the resale of such Offered
Securities has been made in reliance upon the exemption from the
registration requirements of the Securities Act provided by Rule 144A.
5. Certain Agreements of the Company. The Company agrees with the
several Purchasers that:
(a) The Company will arrange for the qualification of the
Offered Securities for sale and the determination of their eligibility
for investment under the laws of such states in the United States as
CSFB designates and will continue such qualifications in effect so long
as required for the resale of the Offered Securities by the Purchasers
provided that the Company will not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
such state.
(b) During the period of two years hereafter, the Company will
furnish to CSFB and, upon request, to each of the other Purchasers, as
soon as practicable after the end of each fiscal year, a copy of its
annual report to shareholders for such year; and the Company will
furnish to CSFB and, upon request, to each of the other Purchasers (i)
as soon as available, a copy of each report and any definitive proxy
statement of the Company filed with the Commission under the Exchange
Act or mailed to shareholders and (ii) from time to time, such other
information concerning the Company as CSFB may reasonably request.
(c) During the period of two years after the Closing Date, the
Company will, upon request, furnish to CSFB, each of the other
Purchasers and any holder of Offered Securities a copy of the
restrictions on transfer applicable to the Offered Securities.
(d) During the period of two years after the Closing Date, the
Company will not, and will not permit any of its affiliates (as defined
in Rule 144 under the Securities Act) to, resell any of the Offered
Securities that have been reacquired by any of them.
(e) During the period of two years after the Closing Date, the
Company will not be or become, an open-end investment company, unit
investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the Investment Company
Act, and is not, and will not be or become, a closed-end investment
company required to be registered, but not registered, under the
Investment Company Act.
(f) The Company will pay all expenses incidental to the
performance of its obliga tions under this Agreement, the Indenture and
the Registration Rights Agreement, including (i) the fees and expenses
of the Trustee and its professional advisers; (ii) all expenses in
connection with the execution, issue, authentication, packaging and
initial delivery of the Offered Securities, the preparation and
printing of this Agreement, the Offered Securities, the Indenture, the
Registration Rights Agreement, the Offering Document and amendments and
supplements thereto, and any other document relating to the issuance,
offer, sale and delivery of the Offered Securities; (iii) the cost of
qualifying the Offered Securities for trading in the
Private Offerings, Resale and Trading through Automated Linkages
(PORTAL) market and any expenses incidental thereto and (iv) the cost
of any advertising approved by the Company in connection with the issue
of the Offered Securities. The Company will reimburse the Purchasers
for any expenses (including fees and disbursements of counsel) incurred
by them in connection with qualification of the Offered Securities for
sale under the laws of such jurisdictions as CSFB designates and the
printing of memoranda relating thereto, for any fees charged by
investment rating agencies for the rating of the Securities, for all
travel expenses
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of the Purchasers and the Company's officers and employees and any
other expenses of the Purchasers and the Company in connection with
attending or hosting meetings with prospec tive purchasers of the
Offered Securities and for expenses incurred in distributing the
Offering Document (including any amendments and supplements thereto) to
the Purchasers.
(g) In connection with the offering, until CSFB shall have
notified the Company and the other Purchasers of the completion of the
resale of the Offered Securities, neither the Company nor any of its
affiliates has or will, either alone or with one or more other persons,
bid for or purchase for any account in which it or any of its
affiliates has a beneficial interest any Offered Securities or attempt
to induce any person to purchase any Offered Securities; and neither it
nor any of its affiliates will make bids or purchases for the purpose
of creating actual, or apparent, active trading in, or of raising the
price of, the Offered Securities.
(h) Except as contemplated by the Indenture and the
Registration Rights Agreement, for a period of 30 days after the date
of the initial offering of the Offered Securities by the Purchasers,
the Company will not offer, sell, contract to sell, pledge, or
otherwise dispose of, directly or indirectly, any United States
dollar-denominated debt securities issued or guaran xxxx by the Company
and having a maturity of more than one year from the date of issue. The
Company will not at any time offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, any securities under
circumstances where such offer, sale, pledge, contract or disposition
would cause the exemption afforded by Section 4(2) of the Securities
Act to cease to be applicable to the offer and sale of the Securities.
6. Conditions of the Obligations of the Purchasers. The obligations of
the several Purchas ers to purchase and pay for the Offered Securities will be
subject to the accuracy of the representa tions and warranties on the part of
the Company herein, to the accuracy of the statements of officers of the Company
made pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
(a) The Purchasers shall have received:
(i) letters, dated the date of this Agreement and the Closing
Date, of Xxxxxx Xxxxxxxx substantially in the form of Exhibit A
hereto to the Purchasers concerning certain of the financial
information with respect to the Company as set forth in the
Offering Document;
(ii)letters, dated the date of this Agreement and the Closing
Date, of Xxxx Xxxxx LLP substantially in the form of Exhibit B
hereto to the Purchasers concerning certain of the financial
information with respect to the Company set forth in the Offering
Document; and
(iii) letters, dated the date of this Agreement and the
Closing Date, of Ernst & Young LLP substantially in the form of
Exhibit C hereto to the Purchasers concerning certain of the
financial information with respect to the company as set forth in
the Offering Docu ment.
(b) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred (i) any
change, or any development or event involving a prospective change, in
the condition (financial or other), business, properties or results of
operations of the Company or its Subsidiaries which, in the judgment of
a majority in interest of the Purchasers, including CSFB, is material
and adverse and makes it impractical or inadvisable to proceed with
completion of the offering or the sale of and payment for the Offered
Securities; (ii) any downgrading in the rating of any debt securities
of the Company by
8
any "nationally recognized statistical rating organization" (as defined
for purposes of Rule 436(g) under the Securities Act), or any public
announcement that any such organization has under surveillance or
review its rating of any debt securities of the Company (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any
suspension or limitation of trading in securities generally on the New
York Stock Exchange or any setting of minimum prices for trading on
such exchange, or any suspension of trading of any securities of the
Company on any exchange or in the over-the-counter market; (iv) any
banking moratorium declared by U.S. Federal or, New York authorities;
or (v) any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by Congress or any
other substantial national or international calamity or emergency if,
in the judgment of a majority in interest of the Purchasers including
CSFB, the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to proceed
with completion of the offering or sale of and payment for the Offered
Securities.
(c) You shall have received on the Closing Date a certificate or
certificates, dated the Closing Date and signed by an executive officer
of the Company, to the effect set forth in clause (b)(ii) above and to
the effect that the representations and warranties of the Company
contained in this Agreement are true and correct as of the Closing Date
and that the Company has complied with all of the agreements and
satisfied all of the conditions on its part to be performed or
satisfied on or before the Closing Date.
The officers signing and delivering such certificate or
certificates may rely upon the best of their knowledge as to
proceedings threatened.
(d) The Purchasers shall have received an opinion, dated the
Closing Date, of Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, counsel for the
Company, that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
State of Delaware, has the corporate power and au thority to own
its property and to conduct its business as described in the
Offering Document, and is duly qualified to transact business and
is in good standing in each juris diction in which the conduct of
its business or its ownership or leasing of property re quires
such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse
effect on the Company and its Subsid iaries, taken as a whole;
(ii)this Agreement has been duly authorized, executed and
delivered by the Company;
(iii) the Indenture has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of
the Company, enforceable in accordance with its terms except as
(a) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally
and (b) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applica
bility; and the Indenture is in such form that it may be
qualified under the Trust Inden ture Act, in compliance with the
terms of the provisions of the Registration Rights Agree ment
without material modification;
(iv) the Offered Securities have been duly authorized by the
Company and, when the Offered Securities are executed by the
Company and authenticated by the Trustee in accordance with the
provisions of the Indenture and delivered to and paid for by the
Purchasers in accordance with the terms of this Agreement, the
Offered Securities will be entitled to
9
the benefits of the Indenture and will be valid and binding
obligations of the Company, enforceable in accordance with their
terms except as (a) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (b) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of
general applicability;
(v) the Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and (assuming
due authorization, execution and delivery by the Purchasers)
constitutes a valid and binding agreement of the Company,
enforceable in accordance with its terms except as (i) the
enforceability thereof may be limited by bank ruptcy, insolvency
or similar laws affecting creditors' rights generally and (ii)
rights of acceleration and the availability of equitable remedies
may be limited by equitable prin ciples of general applicability;
(vi) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this
Agreement, the Offered Securities, the Indenture and the
Registration Rights Agreement will not contravene any provision of
applicable law or the certificate of incorporation, bylaws,
partnership agreement or other organizational documents of the
Company or any Subsidiary of the Company or, to such counsel's
knowledge, any agreement or other instrument binding upon the
Company or any Subsid iary of the Company that is material to the
Company or its Subsidiaries taken as a whole, or, to such
counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Company or any Subsidiary of the Company, and no consent,
approval, authorization or order of or qualification with any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, the Offered
Securities, the Indenture and the Registra tion Rights Agreement,
except such as may be required by (i) the securities or Blue Sky
laws of the various states in connection with the offer and sale
of the Offered Securities and (ii) the securities or Blue Sky laws
of the various states and the Securities Act in connection with
the offer of the Exchange Securities;
(vii) the statements in the Offering Document under the
captions "Description of Notes," "Plan of Distribution" and
"Transfer Restrictions," insofar as such statements constitute
summaries of the legal matters, documents and proceedings referred
to therein, fairly present the information called for with respect
to such legal matters, documents and proceedings and fairly
summarize the matters referred to therein;
(viii) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to which
the Company or any of its Subsidiaries is a party or to which any
of the properties of the Company or any of its Subsidiaries is
subject other than proceedings fairly summarized in all material
respects in the Offering Document and proceedings which such
counsel believes are not likely to have a material adverse effect
on the Company and its Subsidiaries taken as a whole, or on the
power or
ability of the Company to perform its obligations under this
Agreement, the Indenture, the Offered Securities and the
Registration Rights Agreement or to consummate the transac tions
contemplated by the Offering Document;
(ix) based upon the representations, warranties and agreements
of the Company in paragraphs 2(s) and 2(u) of this Agreement and
of the Purchasers in paragraph 4 of this Agreement and on the
representations and agreements in the Offering Document under the
caption "Transfer Restrictions," it is not necessary in connection
10
with the offer, sale and delivery of the Offered Securities to the
Purchasers under this Agreement or in connection with the initial
resale of such Offered Securities by the Purchasers in accordance
with paragraph 4 of this Agreement to register the Offered
Securities under the Securities Act or to qualify the Indenture
under the Trust Indenture Act, it being understood that no opinion
is expressed as to any subsequent resale of any Offered
Securities; and
(x) the Company is not an "investment company" or an entity
"controlled" by an "in vestment company," as such terms are
defined in the Investment Company Act of 1940, as amended.
Such counsel shall also include a statement to the effect that no facts
have come to such counsel's attention that would lead such counsel to believe
that (except for financial statements, sched ules and other financial and
statistical information as to which such counsel need not express any be lief)
the Offering Document when issued did not, and as of the date such opinion is
delivered does not, contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(e) You shall have received on the Closing Date an opinion of
Xxxxxx X. Xxxxx, Xx., General Counsel of the Company, to the effect
that:
(i) each Subsidiary of the Company (x) other than those
Subsidiaries specified in clause (y) of this paragraph (6)(e)(i)
has been duly incorporated, is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation, and has corporate power and authority to own its
property and to conduct its business as described in the Offering
Document or (y) that is not a corporation is a limited partner
ship, has been duly formed and is validly existing as a limited
partnership in good standing under the laws of the jurisdiction of
its formation, and has full power and authority to own its
property and to conduct its business as described in the Offering
Document and, in either case, is duly qualified to transact
business and is in good stand ing in each jurisdiction in which
the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its
Subsidiaries, taken as a whole; and the Company is not a general
partner in any partner ship;
(ii)the Company and each of its Subsidiaries has obtained all
necessary consents, authorizations, approvals, orders, licenses,
certificates and permits of and from, and has made all
declarations and filings with, all foreign, federal, state, local
and other gov ernmental authorities, all self-regulatory
organizations and all courts and other tribunals, required to own,
lease, license, operate and use its properties and assets and to
conduct its business in the manner described in the Offering
Document, except to the extent that the failure to obtain, declare
or file would not have a material adverse effect on the Company
and its Subsidiaries, taken as a whole;
(iii) the contracts and agreements of the Company and its
Subsidiaries and affiliates described in the Offering Document
under "Business -- Description of Facilities -- Power Plants"
conform in all material respects to the descriptions thereof
contained in the Offering Document, and the statements in the
Offering Document under the captions "Management," "Business ---
Legal Proceedings" and "Business -- Government Regula tions" in
each case insofar as such statements constitute summaries of the
legal matters, documents and proceedings referred to therein,
fairly present the information called for with respect to such
legal matters, documents and proceedings and fairly summarize the
matters referred to therein;
11
(iv) such counsel is of the opinion that the Company and each
Subsidiary of the Company (i) is in compliance with any and all
applicable environmental laws, (ii) has received all permits,
licenses or other approvals required of it under applicable
environ mental laws to conduct its business and (iii) is in
compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with environ
mental laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions
of such permits, licenses or approvals would not, singly or in the
aggregate, have a material adverse effect on the Company; and
(v) neither the Company nor any of its Subsidiaries is (i)
subject to regulation as a "holding company" or a "Subsidiary
company" of a holding company or an "affiliate" of a Subsidiary or
holding company or a "public utility company" under Section 2(a)
of PUHCA, (ii) subject to regulation under the FPA, other than as
contemplated by 18 C.F.R. Sec 292.601(c) or (iii) subject to any
state law or regulation with respect to the rates or the financial
or organizational regulation of electric utilities, other than as
contemplated by 18 C.F.R. Sec 292.602(c).
(f) You shall have received on the Closing Date an opinion of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, special counsel for the
Purchasers, dated the Closing Date, covering the matters referred to in
subparagraphs (ii), (iii), (iv), (v), (vii) (but only as to the
statements in the "Description of the Senior Notes," "Plan of
Distribution" and "Transfer Restrictions") and (ix), and subparagraph
(x) of paragraph (d) above.
With respect to the final subparagraph of paragraph (d) above, Xxxxxxx,
Phleger & Xxxxxxxx LLP and Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP may state
that their belief is based upon their participation in the preparation of the
Offering Document and any amendments or supplements thereto and review and
discussion of the contents thereof, but are without independent check or
verification except as specified. With respect to matters of fact, such counsel
may rely on certificates of officers of the Company and of governmental
officials, in which case their opinion is to state that they are so doing and
that the Purchasers are justified in relying on such opinions or certificates
and copies of said opinions or certificates are to be attached to the opinion.
The opinion of Xxxxxxx, Phleger & Xxxxxxxx LLP described in paragraph
(d) above shall be rendered to you at the request of the Company and shall so
state therein.
The Company will furnish the Purchasers and their special counsel with
such conformed copies of such opinions, certificates, letters and documents as
the Purchasers and their special counsel reasonably request. CSFB may in its
sole discretion waive on behalf of the Purchasers compliance with any conditions
to the obligations of the Purchasers hereunder.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each Purchaser against
any losses, claims, damages or liabilities, joint or several, to which such
Purchaser may become subject, under the Securities Act or the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Offering Document, or any
amendment or supplement thereto, or any related preliminary offering circular or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and will reimburse each Purchaser for any legal or other
expenses reasonably incurred by such Purchaser in connection with investigating
or defending any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, claim, damage or liability
12
arises out of or is based upon an untrue statement or alleged untrue statement
in or omission or alleged omission from any of such documents in reliance upon
and in conformity with written information furnished to the Company by any
Purchaser through CSFB specifically for use therein, it being understood and
agreed that the only such information consists of the information described as
such in paragraph (b) below. The indemnity agreement contained in this Section
7(a) with respect to any untrue statements or omission in any preliminary
offering circular shall not inure to the benefit of any Purchaser if the person
asserting such losses, liabilities, claims, damages, or expenses purchased the
Offered Securities which is the subject thereof if at or prior to the written
confirmation of the initial resale of the Offered Securities a copy of the final
offering circular (or the final offering circular as amended or supplemented)
was not sent or delivered to such person and the final offering circular (or the
final offering circular as amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities.
(b) Each Purchaser will severally and not jointly indemnify and
hold harmless the Company, its directors, its officers and each person, if any,
who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any losses, claims,
damages or liabilities to which the Company may become subject, under the
Securities Act or the Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in the Offering Document, or any amendment or supplement thereto, or
any related preliminary offering circular, or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company by such
Purchaser through CSFB specifically for use therein, and will reimburse any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Purchaser consists of the following information in
the Offering Document furnished on behalf of each Purchaser: (i) the last
paragraph at the bottom of the cover page concerning the terms of the offering
by the Purchasers, (ii) the legend on page 3 concerning the stabilization and
overallotment by the Purchasers, (iii) the third sentence contained in the
second paragraph under the caption "Plan of Distribution" concerning the role of
the Purchasers in the offering, (iv) the second sentence of the third paragraph
under the caption "Plan of Distribution" concerning sales of the Offered
Securities, (v) the fourth paragraph under the caption "Plan of Distribution"
concerning sales of the Offered Securities to persons in the United Kingdom,
(vi) the second sentence of the sixth paragraph under the caption "Plan of
Distribution" concerning the intention of the Purchasers to make a market in the
Offered Securities, (vii) the first sentence of the seventh paragraph under the
caption "Plan of Distribution" concerning transactions engaged in by the Company
and the Purchasers and their affiliates, (viii) the third sentence of the
seventh paragraph under the caption "Plan of Distribution" concerning the
affiliation of the Bank of Novia Scotia with one of the Purchasers, and (ix) the
first sentence of the eighth paragraph under the caption "Plan of Distribution"
concerning overallotments and stabilizing.
(c) Promptly after receipt by an indemnified party under this
paragraph of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under paragraph (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under paragraph (a) or (b) above. In case any such action is
brought against any indemnified party and it notifies the indemnify ing party of
the commencement thereof, the indemnifying party will be entitled to participate
therein
13
and, to the extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel satisfactory to
such indemnified party (who shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party), and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under this paragraph for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
uncondition al release of such indemnified party from all liability on any
claims that are the subject matter of such action.
(d) If the indemnification provided for in this paragraph is
unavailable or insufficient to hold harmless an indemnified party under
paragraph (a) or (b) above, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in paragraph (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Purchasers on the other from the offering of
the Offered Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and the Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable consider
ations. The relative benefits received by the Company on the one hand and the
Purchasers on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Company bear to the total discounts and commissions received by the Purchasers
from the Company under this Agreement. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this paragraph (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim which is
the subject of this paragraph (d). Notwithstanding the provisions of this
paragraph (d) no Purchaser shall be required to contribute any amount in excess
of the amount by which the total price at which the Offered Securities purchased
by it were resold exceeds the amount of any damages which such Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. The Purchasers' obligations in this
paragraph (d) to contribute are several in proportion to their respective
purchase obligations and not joint.
(e) The obligations of the Company under this paragraph shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and condi tions, to each person, if any, who
controls any Purchaser within the meaning of the Securities Act or the Exchange
Act; and the obligations of the Purchasers under this paragraph shall be in
addition to any liability which the respective Purchasers may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act.
8. Default of Purchasers. If any Purchaser or Purchasers default in
their obligations to purchase Offered Securities hereunder and the aggregate
principal amount of the Offered Securities that such defaulting Purchaser or
Purchasers agreed but failed to purchase does not exceed 10% of the total
principal amount of the Offered Securities, CSFB may make arrangements
satisfactory to the Company
14
for the purchase of such Offered Securities by other persons, including any of
the Purchas ers, but if no such arrangements are made by the Closing Date, the
non-defaulting Purchasers shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Purchasers agreed but failed to purchase on such Closing Date. If any
Purchaser or Purchasers so default and the aggregate principal amount of the
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total principal amount of the Offered Securities and arrangements
satisfactory to CSFB and the Company for the purchase of such Offered Securities
by other persons are not made within 36 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Purchaser or
the Company, except as provided in paragraph 9. As used in this Agreement, the
term "Purchaser" includes any person substituted for a Purchaser under this
Section. Nothing herein will relieve a defaulting Purchaser from liability for
its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agree ments, representations, warranties and other statements of
the Company or its officers and of the several Purchasers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Purchaser, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to paragraph 8 or if for any reason the purchase of the Offered Securities by
the Purchasers is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to paragraph 5 and the
respective obligations of the Company and the Purchasers pursuant to paragraph 7
shall remain in effect. If the purchase of the Offered Securities by the
Purchasers is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to paragraph 8 or the occurrence of any
event specified in clause (iii), (iv) or (v) of paragraph 6(b), the Company will
reimburse the Purchasers for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by them in connection with the
offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Purchasers will be mailed, delivered or telegraphed and confirmed to
the Purchasers c/o Credit Suisse First Boston Corporation, 00 Xxxxxxx Xxxxxx,
Xxx Xxxx, X.X. 00000, Attention: Investment Banking Department Transactions
Advisory Group, or, if sent to the Company, will be mailed, delivered or
telegraphed and confirmed to it at Calpine Corporation 00 Xxxx Xxx Xxxxxxxx
Xxxxxx, Xxx Xxxx, Xxxxxxxxxx 00000 Attention: Xxxxxx X. Xxxxx, Xx.; provided,
however, that any notice to a Purchaser pursuant to paragraph 7 will be mailed,
delivered or telegraphed and confirmed to such Purchaser.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in paragraph 7, and no other person will have
any right or obligation hereunder, except that holders of Offered Securities
shall be entitled to enforce the agreements for their benefit contained in the
second and third sentences of paragraph 5(c) hereof against the Company as if
such holders were parties hereto.
12. Representation of Purchasers. CSFB will act for the several
Purchasers in connection with this purchase, and any action under this Agreement
taken by CSFB will be binding upon all the Purchasers.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
15
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without regard to
principles of conflicts of laws.
16
If the foregoing is in accordance with the Purchasers' understanding of
our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Purchasers in accordance with its terms.
Very truly yours,
CALPINE CORPORATION
By:
Name:
Title:
The foregoing Purchase Agreement is hereby confirmed and accepted as of the date
first above written.
By: CREDIT SUISSE FIRST BOSTON CORPORATION
Acting on behalf of themselves and as
the Representative of the
several Purchasers.
By:
Name:
Title:
17
SCHEDULE A
Principal
Amount of
Securities
Purchaser
Credit Suisse First Boston Corporation................. $ 100,000,000
Xxxxxx Xxxxxxx & Co. Incorporated ..................... $ 30,000,000
Salomon Brothers Inc................................... $ 30,000,000
Scotia Capital Markets (USA) Inc....................... $ 20,000,000
BancAmerica Securities, Inc............................ $ 10,000,000
CIBC Wood Gundy Securities Corp........................ $ 10,000,000
-----------------------
Total.............. $ 200,000,000
=======================
18
SCHEDULE B
List of Documents Delivered with
Offering Circular
None
19
