Calpine Corporation Emergence Incentive Plan Award Letter to Chuck Clark (February 11, 2008)
This letter from Calpine Corporation's CEO, Robert P. May, confirms that Chuck Clark is eligible to receive 5% of the Emergence Incentive Plan (EIP) Pool, which rewards select senior employees following Calpine's exit from bankruptcy. The award is contingent on Mr. Clark's continued employment, except in cases of termination without cause or resignation for good reason. If terminated for cause or if he resigns without good reason, he forfeits the award. The distribution is expected around May 9, 2008.
Exhibit 10.6.17.2
February 11, 2008
Chuck Clark
717 Texas Ave
Houston, TX 77002
Dear Mr. Clark:
As you are aware, on May 15, 2006, Calpine Corporation (“Calpine”) and its debtor affiliates (collectively, the “Debtors”) received Bankruptcy Court approval of the Emergence Incentive Plan (the “EIP”), which provides variable cash awards to approximately select senior employees. Pursuant to the terms of the EIP, an incentive pool will be created according to certain metrics related to the valuation of Calpine both under the Debtors’ plan of reorganization and based on market value during a certain period after the effective date of the plan (the “EIP Pool”), which, once created will be distributed to eligible employees solely at my discretion as chief executive of Calpine.
As communicated to you earlier, you have been chosen to be a participant in the EIP. This letter confirms my final intentions regarding distribution under the EIP. Accordingly, as of the date hereof, you are eligible to receive 5.00% of the EIP Pool once the EIP Pool is funded.
This proposed distribution percentage is a final and binding decision and cannot be altered except in the event that you are terminated by Calpine for “Cause” or you voluntarily terminate without “Good Reason”, in which case you will forfeit any right to any distribution from the EIP Pool. You will remain eligible to receive the proposed distribution set forth herein if you resign for “Good Cause” or are terminated without “Cause”. The distribution out of the EIP Pool is expected to be made around May 9, 2008.
I believe the Emergence Incentive plan recognizes and rewards our efforts toward a successful exit from bankruptcy. Fortunately for all of us, our combined efforts created a higher than expected adjusted enterprise value which will result in payments from the EIP that are more than competitive.
I look forward to our continued shared success. Should you have any questions regarding the foregoing, please do not hesitate to contact me.
Sincerely,
/s/ Robert P. May
Robert P. May
Chief Executive Officer
