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Gold/Mining/Energy : CPN: Calpine Corporation -- Ignore unavailable to you. Want to Upgrade?

To: kodiak_bull who wrote (224)	12/20/2001 11:23:19 AM
From: aerosappy	Respond to of 555

Kb regarding <<Am I missing something here?>> No, your analysis is correct. While Clement is to be commended for his often insightful research, I think he misstated the return for the new debenture holders. The new debenture issue shows one dark side of CPN -- the greed and arrogance of management. In April 2001, they gave the debenture buyers a 1-year put. A few more b.p could have postponed that put until 2003 or 2004. And all along the way, Ann Curtis has been dumping stock.....

To: kodiak_bull who wrote (224)	12/20/2001 1:49:26 PM
From: Clement	Read Replies (2) \| Respond to of 555

kodiak_bull - Sorry, I wasn't thinking on that point. You and aerosappy are quite right, not quite sure where my mind left to. Mind you, I still think it is a pretty good deal for the bond. Incidentally, I was looking at the terms this morning, and the bond is also _not_ callable -- so providing that the price jumps above $18.07, it will be converted. re: Ann Curtis - she has been dumping at much higher prices. Both she and Peter Cartwright have been dumping at much higher prices but largely as was explained in the past, because of margin calls. Also - as mentioned on one of the calls, we should see sales of options over the next little while because of their option plan for the original employees of Calpine (otherwise they would expire worthless). re: arrogance of management and timelines... I'm not sure I agree with aerosappy's assessment. No one had forecast that Calpine's stock would have undergone such a meltdown (and Calpine's management even borrowed to buy stock hence the margin calls). Calpine's management already believed that the stock was oversold at significantly higher prices -- is that arrogant? They after all should have a better idea of what the company is worth. As to the tradeoff of a few basis points, at the time, it did seem like an easy bet to make. The stock had taken a hit, the prospects continued to look strong, and the company would likely continue to post gangbuster numbers ... who would have thought Enron could have gone bankrupt in the span of two months? In this context now, I think their worriment may have swung too far the other way. I'm not sure it was wise to have done this much... but at the same time I guess it's prudent for the just in case scenarios... again, who would have thought Enron would go bankrupt? Clement

To: kodiak_bull who wrote (224)	1/6/2002 12:01:44 AM
From: Howard R. Hansen	Read Replies (3) \| Respond to of 555

If the bondholder pays $1 billion for this issue he gets two things: a 4% coupon bond and the right to convert at $18.07 per share, that is, pay $18.07 to buy one share of CPN. Your wording has me confused. Are you saying that when a holder of one of these convertible notes converts his note into common stock he/she has to pay $18.07 per share for their common stock he/she receives? Up to now I had been under the impression there was a straight swap of a convertible note for X number of shares of Calpine stock when the price of Calpine exceeded $18.07 per share. Which is it?