Exhibit 10.5.13
EMPLOYMENT AGREEMENT
          This Employment Agreement (the “Agreement”) is entered into on
June 13, 2006, between CALPINE CORPORATION, a Delaware corporation (the
“Company”), and Robert E. Fishman (“Executive”) to provide the terms and
conditions for Executive’s employment with the Company and its affiliates from
time to time (together, the “Group”). This Agreement is conditioned upon the
following: (a) the approval of the United States bankruptcy court having
jurisdiction over the Company’s reorganization under Chapter 11 of the U.S.
Bankruptcy Code (the “Bankruptcy Court”); and (b) the approval of the Company’s
Compensation Committee.
          The Company and Executive have agreed that Executive will be employed
by the Company and will serve as the Company’s EVP – Power Operations, upon the
terms and conditions set forth below.
          Accordingly, and in consideration of the mutual obligations set forth
in this Agreement, which Executive and the Company agree are sufficient,
Executive and the Company agree as follows:

1   Term of Employment.

          Subject to the provisions of paragraph 4 below, Executive’s term of
employment under this agreement (“Term of Employment”) consists of the initial
term and any subsequent term for which the Agreement is renewed. The initial
term of this Agreement (“Initial Term”) begins on June 13, 2006, and ends on
June 13, 2007. Subject to the termination provisions of paragraph 4 below,
Executive’s employment by the Company shall be automatically renewed for an
additional 12 months at the end of the Initial Term and each annual anniversary
of the end of the then-current renewal term unless either party provides written
notice to the other party no less than 90 days prior to the date of any such
scheduled renewal of its or the Executive’s intention not to renew the term of
Executive’s employment.

2   Position and Responsibilities.

          During the Term of Employment, Executive shall have the position and
responsibilities described below. Executive shall be employed as the Company’s
EVP – Power Operations, with the general power and authority that accompanies
that position. Executive shall report directly to the Chief Executive Officer
and shall have the duties and responsibilities that are typically performed by
an EVP – Power Operations, as well as any other duties consistent with
Executive’s position that are assigned to Executive by the Chief Executive
Officer or the Board. In addition, as Executive Vice President – Power
Operations, Executive shall: (i) have overall responsibility for production and
execution of business plans, strategies, and goals for Power Operations, all
day-to-day power plant operations, major maintenance and capital project
planning, asset management and project development; and (ii) participate in the
formulation of Company’s business and strategic plans. Executive agrees to
comply with such lawful policies of the Company as may be adopted from time to
time. Although Executive may be reasonably required to travel from time to time
for business reasons, Executive’s principal place of employment shall be the
Company’s corporate offices wherever located.

 

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  (a)   Executive shall devote all of his full business time and his best
efforts, skill, and attention to the Company’s business and affairs and to
promoting the Company’s best interests.     (b)   Notwithstanding the foregoing,
nothing herein shall preclude Executive from (i) serving on the board of
directors of one other corporation (subject to the approval of the Chief
Executive Officer, such approval not to be unreasonably withheld), (ii) serving
on the board of directors of one charitable organization (subject to the
approval of the Chief Executive Officer, such approval not to be unreasonably
withheld), (iii) engaging in charitable activities and community affairs, and
(iv) managing his personal investments and affairs, provided that any such
activities listed in (i), (ii) and (iii) above do not interfere in more than a
de minimis manner with the proper performance of his duties and responsibilities
hereunder and comply with the limitations set forth in paragraph 5.a.

3   Compensation.

          For all of Executive’s services during the Term of Employment,
Executive shall receive the following compensation:

  (a)   Base Salary. Executive’s annual base salary shall be $500,000 (as may be
increased from time to time, the “Base Salary”). The Chief Executive Officer and
Board (or a committee thereof) will review the Base Salary at least annually and
may increase it at any time for any reason, in their sole discretion; however,
they shall have no obligation to do so.     (b)   Bonus. In addition to
Executive’s Base Salary, Executive shall be eligible to receive an annual cash
performance bonus (the “Bonus”) for each fiscal year ending during the Term of
Employment if, and to the extent that, Executive remains employed by the Company
on the last day of such fiscal year and corporate performance objectives
established by the Chief Executive Officer and the Board are achieved, as
determined by the Chief Executive Officer and the Board (or a committee
thereof), in their sole discretion. Payment of the Bonus shall be made at the
same time that other senior-level executives receive their bonuses, and no later
than March 15th of the calendar year after the calendar year in which the Bonus
is earned. The target level for Executive’s Bonus shall be established by the
Board (or a committee thereof) in their sole discretion, provided that the
minimum target level for any year shall be 90% of the Base Salary (the “Target
Annual Bonus”).     (c)   Benefits. Executive shall be eligible to participate
in all Company benefit plans and programs as are generally available for its
senior executives, and Executive’s benefits shall be based on the terms of the
applicable plan as established by the Company from time to time; provided,
however, that the Executive shall not be eligible for benefits under the Calpine
Corporation U.S. Severance Program. Nothing in this Agreement shall restrict the
Company’s ability to change or terminate any or all of its employee benefit
plans and programs from time to time; nor shall anything in this Agreement
prevent any such change from affecting Executive.

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  (d)   Success Fee. When a plan of reorganization that is confirmed by the
Bankruptcy Court becomes effective (the “Plan Effective Date”) during
Executive’s tenure as Company’s EVP – Power Operations, Executive shall be
eligible to receive a one-time payment of a Success Fee at the sole discretion
of the Chief Executive Officer of the Company as part of the Company’s Emergence
Incentive Plan.     (e)   Guaranteed Minimum Success Fee. Executive shall be
entitled to receive the guaranteed minimum success fee (the “Guaranteed Minimum
Success Fee”) described in this paragraph 3.e; provided, however, that this
paragraph 3.e shall not apply after the Plan Effective Date. The Guaranteed
Minimum Success Fee shall be deemed earned as of the date this Agreement is
approved by the Bankruptcy Court.

  (i)   Amount and Payment Schedule. Executive’s Guaranteed Minimum Success Fee
shall be an annual amount equal to the two times his annual Base Salary as of
the earlier of (a) the date his term of employment under this Agreement
terminates or (b) the Plan Effective Date. The Guaranteed Minimum Success Fee
shall be paid to Executive on the earliest of (y) the date Executive is
terminated by the Company without Cause, and (z) the date Executive terminates
his employment for Good Reason. The Guaranteed Minimum Success Fee shall be paid
ratably on the same payment schedule that applied to Executive’s salary as of
such date.     (ii)   Timing. To the extent necessary to comply with the
restriction in Section 409A(a)(2)(B) of the Internal Revenue Code of 1986, as
amended (the “Code”) concerning payments to specified employees, the first
Guaranteed Minimum Success Fee payment (if the Guaranteed Minimum Success Fee is
paid ratably) to Executive shall be made on the first installment date
(determined under paragraph 3.e.i, above) that is at least six months after
Executive’s termination date. The first payment shall include any installments
that would have been paid previously under paragraph 3.e.i were it not for this
special timing rule, plus interest on the delayed installments at an annual rate
(compounded monthly) equal to the federal short-term rate (as in effect under
Section 1274(d) of the Code on Executive’s termination date).

4   Termination.

  (a)   Termination of Employment.

  (i)   Termination by the Company for Cause. The Board or Chief Executive
Officer may terminate Executive’s employment for Cause at any time. “Cause”
means any of the following: (1) Executive’s breach of any material term of this
Agreement that is not corrected within 10 days after delivery of a termination
notice to Executive with respect to such breach; (2) Executive’s commission of,
or formal prosecutorial charge or indictment alleging commission of, a felony or
any crime of similar status, any crime involving fraud or any crime involving
moral turpitude (other than motor vehicle related) (it being agreed that in the

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      case of a crime involving moral turpitude, only to the extent such crime
materially and adversely affects the business, standing or reputation of the
Company or any other member of the Group); (3) Executive’s breach of fiduciary
duty to the Company or any other member of the Group that has any material and
adverse impact on the Company that is not corrected within 10 days after
delivery of a termination notice to Executive with respect to such breach; (4)
Executive’s misappropriation of funds or material property of the Company or any
other member of the Group; (5) Executive’s refusal to follow the lawful
directives of the Chief Executive Officer or Board without a materially valid
business justification that is not corrected within 10 days after delivery of a
termination notice to Executive with respect to such refusal; (6) Executive’s
fraud related to the Company; (7) Executive’s material dishonesty, disloyalty,
gross negligence or willful misconduct, where such dishonesty, disloyalty, gross
negligence or willful misconduct is reasonably likely to result, in substantial
and material damage to the Company or any other member of the Group;
(8) Executive’s willful and material violation of any of the Company’s Code of
Conduct or employment policies; or (9) Executive’s material violation of any
federal, state or local laws that could result in a direct or indirect financial
loss to the Company or any other member of the Group or damage the reputation of
the Company or any other member of the Group.         For this definition, no
act or omission by the Executive will be “willful” unless it is made by him in
bad faith or without a reasonable belief that Executive’s act or omission was in
the best interests of the Company or the Group. Any act, or failure to act,
based upon the advice of counsel to the Company or any member of the Group shall
be presumed to be done, or omitted to be done, by the Executive in good faith
and in the best interests of the Company and the Group.     (ii)   Termination
by the Company without Cause. The Company may terminate Executive’s employment
under this Agreement without Cause upon at least 20 days’ prior written notice
to Executive.     (iii)   Death or Disability. Executive’s employment by the
Company will immediately terminate upon Executive’s death and at the option of
either Executive or the Company, exercisable upon written notice to the other
party, may terminate upon the Executive’s Disability. For purposes of this
Agreement, “Disability” will occur if (A) Executive becomes eligible for
benefits under a long-term disability policy provided by the Company, if any, or
(B) Executive has become unable, due to physical or mental illness or
incapacity, to substantially perform the essential duties of Executive’s
employment with reasonable accommodation for a period of 90 days or an aggregate
of 180 days during any consecutive 12 month

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      period, as determined by an independent physician approved by the Company
and Executive.     (iv)   Termination by Executive for Good Reason. Executive
may terminate his employment for Good Reason at any time. “Good Reason” shall
mean the occurrence, during the Term of Employment, of any of the following
actions or failures to act, but in each case only if it is not consented to by
Executive in writing: (A) a material adverse change in Executive’s duties,
reporting responsibilities, titles or elected or appointed offices as in effect
immediately prior to the effective date of such change; (B) any reduction or
failure to pay when due the Executive’s Base Salary or Bonus earned; (C) the
Company’s failure to renew this Agreement; (D) the Company’s breach of any
material term of this Agreement that is not corrected within 10 days after
delivery of a notice to the Company with respect to such breach or (E) the
failure of the Company to obtain the assumption in writing of this Agreement by
any successor to or an acquirer of all or substantially all of the assets of the
Company on or prior to a merger, consolidation, sale or similar transaction. For
purposes of this definition, none of the actions described in clauses
(A) through (E) above shall constitute “Good Reason” with respect to Executive
if it was an isolated and inadvertent action not taken in bad faith by the
Company and if it is remedied by the Company within 10 days after receipt of
written notice thereof given by Executive.     (v)   Termination by Executive
without Good Reason. Executive may terminate his employment under this Agreement
without Good Reason upon at least 20 days’ prior written notice to the Company.

  (b)   Consequences of Termination of Employment.

  (i)   Termination by the Company without Cause or by Executive for Good Reason
before the Plan Effective Date. Executive shall receive the benefits described
in this paragraph 4.b (excluding the severance benefits set forth in paragraphs
4.b.ii.1 and 4.b.ii.2) if the Company terminates Executive’s employment without
Cause (under paragraph 4.a.ii) at any time during the Term of Employment or if
Executive terminates his employment at any time during the Term of Employment
for Good Reason (under paragraph 4.a.iv) prior to the Plan Effective Date. For a
period of one year following the date of termination of Executive’s employment
from the Company, the Company shall at its sole cost and expense (but
disregarding any individual tax liability of Executive), and at the election of
COBRA by Executive, provide Executive (and his spouse and eligible dependents)
with group health benefits substantially similar to those benefits that
Executive (and his spouse and eligible dependents) were receiving immediately
before his termination (which may at the Company’s election be pursuant to
reimbursement of the applicable COBRA premium). Such coverage

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      shall be provided to Executive as COBRA benefits and shall terminate prior
to the end of the one-year period if Executive, his spouse or eligible
dependents are no longer eligible for COBRA coverage. To the extent possible,
the benefits under this section 4.b.i.1 shall be made in a manner that is tax
efficient for the Executive so long as there is no adverse tax consequences to
the Company.     (ii)   Termination by the Company without Cause or by Executive
for Good Reason after the Plan Effective Date. Executive shall receive the
benefits described in this paragraph 4.b.ii (including the benefits set forth in
paragraph 4.b.i.) if the Company terminates Executive’s employment without Cause
(under paragraph 4.a.ii) at any time during the Term of Employment or if
Executive terminates his employment at any time during the Term of Employment
for Good Reason (under paragraph 4.a.iv) after the Plan Effective Date. If
Executive receives the benefits set forth in this paragraph 4.b.ii, Executive
shall not be eligible for severance benefits from any other plan, program or
policy of the Company then in effect.

  1.   Amount and Payment Schedule. Executive’s severance benefit (in addition
to the other payments specifically contemplated in this Agreement) shall be an
amount equal to two times his annual Base Salary as of the date his employment
terminates. Subject to the timing rule described in paragraph 4.b.ii.2 below,
the severance benefit shall be paid ratably on the same payment schedule that
applied to Executive’s salary at the time of his termination.     2.   Timing.
To the extent necessary to comply with the restriction in Section 409A(a)(2)(B)
of the Internal Revenue Code of 1986, as amended (the “Code”) concerning
payments to specified employees, the first severance payment to Executive shall
be made on the first installment date (determined under paragraph 4.b.ii.1
above) that is at least six months after Executive’s termination date. The first
payment shall include any installments that would have been paid previously
under paragraph 4.b.ii.1 were it not for this special timing rule, plus interest
on the delayed installments at an annual rate (compounded monthly) equal to the
federal short-term rate (as in effect under Section 1274(d) of the Code on
Executive’s termination date).

  (iii)   Death or Disability. In the event of termination of Executive’s
employment due to death or Disability (under paragraph 4.a.iii), Executive shall
be entitled to receive (in addition to any other payments specifically
contemplated in this Agreement) a pro rata portion of his Target Annual Bonus
for the portion of the calendar year before the date of termination of
employment, as promptly as practicable and in any

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      event payable on or before March 15th of the calendar year after the
calendar year in which such termination of employment occurs; but Executive
shall not be eligible to receive any other severance benefit under this
paragraph 4. Executive’s eligibility (if any) to receive a severance or
retirement benefit under any other severance or retirement plan or program
maintained by the Company shall be determined by the terms of that plan or
program as in effect on Executive’s termination date.     (iv)   Termination for
Cause or Voluntary Termination. If the Company terminates Executive’s employment
for Cause (under paragraph 4.a.i), or if Executive terminates his employment
without Good Reason (under paragraph 4.a.v), Executive shall receive accrued but
unpaid base salary earned only through Executive’s termination date, and shall
not be eligible to receive any severance benefit under this paragraph 4.b.
Executive’s eligibility (if any) to receive a severance or retirement benefit
under any other severance or retirement plan or program maintained by the
Company shall be determined by the terms of that plan or program as in effect on
Executive’s termination date. The foregoing shall not limit the remedies
available to the Group, at law or in equity, for any loss or other injury caused
directly or indirectly by Executive.     (v)   Release. The Company will not be
required to make the payments stated in this paragraph 4 unless the Executive
executes and delivers to the Company an agreement releasing from all liability
(other than Executive’s rights under this Agreement and any indemnification
arrangement of the Company with respect to Executive) the Group and any of their
respective past or present directors, officers, employees, shareholders,
controlling persons or agents of the Group. No payment will be made until the
period for revocation of the release has ended and unless Executive has not
revoked the release.

5   Restrictive Covenants.

  (a)   Non-Competition. During the time Executive is employed by the Company
and for 12 months thereafter, Executive shall not directly or indirectly manage,
operate, participate in, be employed by, perform consulting services for, or
otherwise be connected with NRG Energy, Inc., Mirant Corporation, Reliant
Energy, Dynegy Inc., Edison Mission Energy/Edison International, Constellation
Energy Group, Inc. (FPL Group, Inc.) and Pacific Gas & Electric Company (each a
“Competitive Enterprise”); nor shall Executive receive compensation from any
other company or business during the time Executive is employed with the Company
unless the arrangement giving rise to such compensation has been (i) disclosed
to and approved by the Chief Executive Officer and the Board in advance or
(ii) is otherwise permitted by the terms of this Agreement.

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      Executive may invest in any Competitive Enterprise, provided that
Executive and Executive’s immediate family members (as defined in
Section 1361(c)(B) of the Code) do not own collectively more than one percent of
the voting securities of any such entity at any time. If Executive is terminated
without cause or leaves for good reason, Executive may reduce this non-compete
provision from 12 months to as short as 6 months by repaying a pro rata portion
of the Guaranteed Minimum Success Fee (net of any associate income and
employment taxes) or any severance benefits, if applicable, prior to operating,
participating in, being employed by or performing consulting services for the
above referenced competitive enterprises. Within 10 days after the filing of
Executive’s federal income tax return for the year in which such repayment is
made, Executive shall pay to the Company the amount by which Executive’s federal
and state income tax liability for such year was reduced as a result of such
repayment.     (b)   Use and Disclosure of Proprietary Information.

  (i)   Definition of Proprietary Information. “Proprietary Information” means
confidential or proprietary information, knowledge or data concerning (1) the
Group’s businesses, strategies, operations, financial affairs, organizational
matters, personnel matters, budgets, business plans, marketing plans, studies,
policies, procedures, products, ideas, processes, software systems, trade
secrets and technical know-how, (2) any other matter relating to the Group,
(3) any matter relating to clients of the Group or other third parties having
relationships with the Group and (4) any confidential information from which the
Group derives business advantage or economic value. Proprietary Information
includes (A) the names, addresses, phone numbers and buying habits and
preferences and other information concerning clients and prospective clients of
the Group, and (B) information and materials concerning the personal affairs of
employees of the Group. In addition, Proprietary Information may include
information furnished to Executive orally or in writing (whatever the form or
storage medium) or gathered by inspection, in each case before or after the date
of this Agreement. Proprietary Information does not include information (X) that
was or becomes generally available to Executive on a non-confidential basis, if
the source of this information was not reasonably known to Executive to be bound
by a duty of confidentiality, (Y) that was or becomes generally available to the
public, other than as a result of a disclosure by Executive, directly or
indirectly, or (Z) that Executive can establish was independently developed by
Executive without reference to Proprietary Information.     (ii)  
Acknowledgements. Executive acknowledges that he will obtain or create
Proprietary Information in the course of Executive’s involvement in the Group’s
activities and may already have Proprietary Information.

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      Executive agrees that the Proprietary Information is the exclusive
property of the Group. In addition, nothing in this Agreement will operate to
weaken or waive any rights the Group may have under statutory or common law, or
any other agreement, to the prohibition of unfair competition or the protection
of trade secrets, confidential business information and other confidential
information.     (iii)   During Employment. Executive will use and disclose
Proprietary Information only for the Group’s benefit and in accordance with any
restrictions placed on its use or disclosure by the Group.     (iv)  
Post-Employment. After the termination of Executive’s employment, Executive will
not use or disclose any Proprietary Information for any purpose. For the
avoidance of doubt, but without limitation of the foregoing, after termination
of Executive’s employment, Executive will not directly or indirectly use
Proprietary Information from which the Group derives business advantage or
economic benefit to solicit, impair or interfere with, or attempt to solicit,
impair or interfere with, any person or entity, who, at the time of the
termination of Executive’s employment, is then a customer, vendor or business
relationship of the Group (or who Executive knew was a potential customer,
vendor or business relationship of the Company within the six months prior to
the termination of Executive’s Employment).

  (c)   Non-Solicitation of Employees. During the Term of Employment and for an
18 month period after termination of Executive’s employment, Executive will not
directly or indirectly solicit or attempt to solicit anyone who, at the time of
the termination of Executive’s employment, is then an employee of the Group (or
who was an employee of the Group within the six months prior to the termination
of Executive’s Employment) to resign from the Group or to apply for or accept
employment with any company or other enterprise.     (d)   Non-Disparagement.
During and after Executive’s employment with the Company, the parties mutually
covenant and agree that neither will directly or indirectly disparage the other,
or make or solicit any comments, statements, or the like to any clients,
competitors, suppliers, employees or former employees of the Company, the press,
other media, or others that may be considered derogatory or detrimental to the
good name or business reputation of the other party. Nothing herein shall be
deemed to constrain either party’s cooperation in any Board authorized
investigation or governmental action. In the event of Executive’s termination or
the non-renewal of this Agreement, Executive and Company shall agree on any
press release relating to such termination or non-renewal and the Company and
Executive shall not publicly discuss or comment on Executive’s termination or
non-renewal in any manner other than as mutually agreed in the press release.

6   Employment Taxes. All payments and other compensation under this Agreement
shall be subject to withholding of the applicable income and employment taxes.  

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7   Nonduplication of Benefits. No term or other provision of this Agreement may
be interpreted to require the Company to duplicate any payment or other
compensation that Executive is already entitled to receive under a compensation
or benefit plan, program, or other arrangement maintained by the Company.   8  
Indemnification. To the fullest extent permitted by applicable law, the Company
shall provide indemnification for Executive under its Articles of Incorporation
and Bylaws. Executive shall be covered by the Company’s standard indemnification
agreement and by any director’s and officer’s liability insurance policy
maintained by the Company.   9   Successors. Any successor to the Company or to
all or substantially all of the Company’s business and/or assets (whether a
direct or indirect successor, and whether by purchase, lease, merger,
consolidation, liquidation, or otherwise) shall assume the obligations under
this Agreement. In case of any succession, the term “Company” shall refer to the
successor. The terms of this Agreement and all of Executive’s rights hereunder
shall inure to the benefit of, and be enforceable by, Executive’s personal or
legal representatives, executors, administrators, successors, heirs,
distributees, devisees, and legatees.   10   No Third-Party Beneficiaries.
Except as provided in paragraph 9 above, nothing in this Agreement may confer
upon any person or entity not a party to this Agreement any rights or remedies
of any nature or kind whatsoever under or by reason of this Agreement.   11   No
Duty to Mitigate. Executive shall not be required to seek new employment or
otherwise to mitigate the payments contemplated by this Agreement. The payments
contemplated by this Agreement shall not be reduced by earnings that Executive
may receive from any other source; provided, however, that COBRA payments may
cease in accordance with the provisions of this Agreement.   12   Notice.
Notices and other communications between the parties to this Agreement shall be
delivered in writing and shall be deemed to have been given when personally
delivered or on the third business day after mailing by U.S. registered or
certified mail, return receipt requested and postage prepaid.

  (a)   Notices and other communications to Executive shall be addressed to
Executive, at the most recent home address that he provided in writing to the
Company.     (b)   Notices and other communications to the Company shall be
addressed to the Company’s corporate headquarters, to the attention of the
Company’s Secretary.

13   Waiver and Amendments. No provision of this Agreement may be modified,
waived, or discharged, unless the modification, waiver, or discharge is agreed
to in writing signed by Executive and by an authorized representative of the
Company (other than Executive). Unless specifically characterized as a
continuing waiver, no waiver of a condition or provision at anyone time may be
considered a waiver of the same provision or condition (or any different
provision or condition) at any other time.   14   Costs. The prevailing party in
any dispute or disagreement relating to this Agreement and/or any obligations
under this Agreement shall be entitled to recover from the other

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    party any expenses, including reasonable attorney’s fees, incurred by the
prevailing party as a result of, or in connection with, any such dispute or
disagreement. Notwithstanding anything to the contrary, the obligation under
this Section shall survive any termination of this Agreement or Executive’s
termination of employment.   15   Ability to Enter this Agreement. Executive
represents and warrants that neither the execution and delivery of this
Agreement nor the performance of Executive’s services hereunder will conflict
with, or result in a breach of any employment or other agreement to which
Executive is a party or by which Executive might be bound or affected. Executive
further represents and warrants that Executive has full right, power, and
authority to enter into and carry out the provisions of this Agreement.   16  
Remedy at Law Inadequate. Executive acknowledges that a remedy at law for any
breach or attempted breach of the covenants described in paragraph 5 of this
Agreement will be inadequate and agrees that the Group shall be entitled to
specific performance and injunctive and other equitable relief in the case of
any such breach or attempted breach.   17   American Jobs Creation Act of 2004.
This Agreement shall be construed, administered and interpreted in accordance
with a good-faith interpretation of Section 409A of the Code and Section 885 of
the American Jobs Creation Act of 2004. If the Company or Executive determines
that any provision of this Agreement is or might be inconsistent with such
provisions (including any administrative guidance issued thereunder), the
parties shall make their best efforts in good faith to agree to such amendments
to this Agreement as may be necessary or appropriate to comply with such
provisions.   18   Choice of Law. This Agreement (including its validity,
interpretation, construction, and performance) shall be governed by the laws of
the State of New York, without regard to any concerning conflicts or choice of
law that might otherwise refer construction or interpretation to the substantive
law of another jurisdiction.   19   Section Headings. All headings in this
Agreement are inserted for convenience only. Headings do not constitute a part
of the Agreement and may not affect the meaning or interpretation of any term or
other provision of this Agreement.   20   Severability and Reformation. Each
substantive provision of this Agreement is a separate agreement, independently
supported by good and adequate consideration, and is severable from the other
provisions of the Agreement. If a court of competent jurisdiction determines
that any term or provision of this Agreement is unenforceable, then the other
terms and provisions of this Agreement shall remain in full force and effect,
and the unenforceable terms or provisions shall be equitably modified to the
extent necessary to achieve the underlying purpose in an enforceable way.   21  
Whole Agreement. This Agreement reflects the entire understanding and agreement
between the Company and Executive regarding Executive’s employment. This
Agreement supersedes all prior negotiations, discussions, correspondence,
communications, understandings, and agreements, whether oral or written,
relating to Executive’s employment with the Company. The respective rights and
obligations of

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    the parties to this Agreement shall survive the termination of Executive’s
employment to the extent necessary to give such rights and obligations their
intended effect.   22   Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute a single instrument.

* * *
IN WITNESS WHEREOF, the parties to this Agreement have executed this Agreement
on June 13, 2006.
CALPINE CORPORATION:

                 
By
  /s/ R.P. May          
 
             
Its 
  CEO        
 
             
 
             
 
           

EXECUTIVE:

               

/s/ Robert E. Fishman        
 
         
 
Robert E. Fishman        

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