
<PAGE>   1
 
                             LETTER OF TRANSMITTAL
                                      FOR
 
                          7 7/8% SENIOR NOTES DUE 2007
                                       OF
 
                              CALPINE CORPORATION
                  PURSUANT TO THE EXCHANGE OFFER IN RESPECT OF
              ALL OF ITS OUTSTANDING 7 7/8% SENIOR NOTES DUE 2008
                                      FOR
                          7 7/8% SENIOR NOTES DUE 2008
                            ------------------------
              PURSUANT TO THE PROSPECTUS DATED AUGUST      , 1998
 
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
               , 1998 UNLESS THE EXCHANGE OFFER IS EXTENDED (THE "EXPIRATION
DATE"). TENDERS OF OLD NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M. ON
THE EXPIRATION DATE.
 
                    TO: THE BANK OF NEW YORK, EXCHANGE AGENT
 
<TABLE>
<CAPTION>
            By Mail:                        By Facsimile:             By Hand or Overnight Carrier:
<S>                               <C>                               <C>
      The Bank of New York                 (212) 815-6339                 The Bank of New York
  101 Barclay Street, Floor 7E          Confirm by Telephone:              101 Barclay Street
    New York, New York 10286               (212) 815-2791            Corporate Trust Services Window
     Attn: Denise Robertson                                                   Ground Level
                                                                        New York, New York 10286
                                                                         Attn: Denise Robertson
</TABLE>
 
                 PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL
                   CAREFULLY BEFORE COMPLETING ANY BOX BELOW
 
--------------------------------------------------------------------------------
 
<TABLE>
<S>                                                    <C>                  <C>                  <C>
                                          DESCRIPTION OF OLD NOTES TENDERED
---------------------------------------------------------------------------------------------------------------------
   NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
    (PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S)
                APPEAR(S) ON OLD NOTES)
---------------------------------------------------------------------------------------------------------------------
                                                                                 AGGREGATE
                                                           CERTIFICATE        PRINCIPAL AMOUNT        PRINCIPAL
                                                            NUMBER(S)*         OF OLD NOTE(S)         TENDERED**
                                                       ----------------------------------------------------------
 
                                                       ----------------------------------------------------------
 
                                                       ----------------------------------------------------------
 
                                                       ----------------------------------------------------------
 
                                                              TOTAL
</TABLE>
 
--------------------------------------------------------------------------------
 
    * Need not be completed if Old Notes are being tendered by book-entry
      transfer.
 
   ** Unless otherwise indicated in this column, a holder will be deemed to
      have tendered the entire principal amount represented by the Old Note
      indicated in column 2. See Instruction 2. Old Notes tendered hereby
      must be in denominations of principal amount of $1,000 and any integral
      multiple thereof. See Instruction 1.
--------------------------------------------------------------------------------
 
     BY EXECUTION HEREOF, THE UNDERSIGNED ACKNOWLEDGES RECEIPT OF THE PROSPECTUS
DATED AUGUST   , 1998 (THE "PROSPECTUS") OF CALPINE CORPORATION, A DELAWARE
<PAGE>   2
 
CORPORATION (THE "COMPANY"), WHICH, TOGETHER WITH THIS LETTER OF TRANSMITTAL AND
THE INSTRUCTIONS HERETO (THE "LETTER OF TRANSMITTAL"), CONSTITUTES THE COMPANY'S
OFFER (THE "EXCHANGE OFFER") TO EXCHANGE $1,000 PRINCIPAL AMOUNT OF ITS 7 7/8%
SENIOR NOTES DUE 2008 (THE "NEW NOTES"), WHICH HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), PURSUANT TO A
REGISTRATION STATEMENT OF WHICH THE PROSPECTUS CONSTITUTES A PART, FOR EACH
$1,000 PRINCIPAL AMOUNT OF ITS OUTSTANDING 7 7/8% SENIOR NOTES DUE 2008 (THE
"OLD NOTES"), UPON THE TERMS AND SUBJECT TO THE CONDITIONS SET FORTH IN THE
PROSPECTUS.
 
     DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS, OR TRANSMISSION VIA
FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF
TRANSMITTAL IS COMPLETED.
 
     HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE NEW NOTES FOR THEIR OLD NOTES
PURSUANT TO THE EXCHANGE OFFER MUST VALIDLY TENDER (AND NOT WITHDRAW) THEIR OLD
NOTES TO THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE.
 
     This Letter of Transmittal is to be used by Holders (as defined below) if
certificates representing Old Notes are to be physically delivered to the
Exchange Agent herewith by Holders. If tender of Old Notes is to be made by
book-entry transfer to the Exchange Agent's account at The Depository Trust
Company ("DTC") through the DTC Automated Tender Offer Program ("ATOP"), such
tender may be made by transmission of an Agent's Message pursuant to the
procedures set forth in the Prospectus under "The Exchange Offer -- Procedures
for Tendering" by any financial institution that is a participant in DTC and
whose name appears on a security position listing as the owner of Old Notes
(such participants, acting on behalf of Holders are referred to herein, together
with such Holders, as "Acting Holders"). Holders whose Old Notes are not
available or who cannot deliver their Old Notes and all other documents required
hereby to the Exchange Agent by 5:00 p.m. on the Expiration Date may tender
their Old Notes in accordance with the guaranteed delivery procedures set forth
in the Prospectus under "The Exchange Offer -- Guaranteed Delivery Procedures."
See Instruction 1. DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO
THE EXCHANGE AGENT.
 
     The term "Holder" with respect to the Exchange Offer means any person: (i)
in whose name Old Notes are registered on the books of the Company or any other
person who has obtained a properly completed bond power from the registered
Holder; or (ii) whose Old Notes are held of record by DTC and who desires to
deliver such Old Notes by book-entry transfer at DTC.
 
     The undersigned has completed, executed and delivered this Letter of
Transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer. Holders who wish to tender their Old Notes must complete
this letter in its entirety.
 
     THE EXCHANGE OFFER IS NOT BEING MADE TO (NOR WILL THE SURRENDER OF
OUTSTANDING NOTES FOR EXCHANGE BE ACCEPTED FROM OR ON BEHALF OF) HOLDERS IN ANY
JURISDICTION IN WHICH THE MAKING OR ACCEPTANCE OF THE EXCHANGE OFFER WOULD NOT
BE IN COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION.
 
     HOLDERS WHO WISH TO EXCHANGE THEIR OLD NOTES MUST COMPLETE ALL OF THE
COLUMNS IN THE BOX ENTITLED "DESCRIPTION OF OLD NOTES TENDERED" ON THE PRIOR
PAGE, COMPLETE THE BOX BELOW ENTITLED "METHOD OF DELIVERY" AND SIGN WHERE
INDICATED BELOW.
 
     THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OLD NOTES
TENDERED" AND SIGNING THIS LETTER OF TRANSMITTAL, WILL BE DEEMED TO HAVE
TENDERED THE OLD NOTES AND MADE CERTAIN REPRESENTATIONS DESCRIBED IN THE
PROSPECTUS AND HEREIN.
 
     All capitalized terms used herein and not defined shall have the meaning
ascribed to them in the Prospectus.
<PAGE>   3
 
                               METHOD OF DELIVERY
 
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED OLD NOTES ARE ENCLOSED HEREWITH.
 
[ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
    MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY
    TRANSFER FACILITY AND COMPLETE THE FOLLOWING:
 
   Name of Tendering Institution
 
 -------------------------------------------------------------------------------
 
   Account Number
   -----------------------------------------------------------------------------
 
   Transaction Code Number
   -----------------------------------------------------------------------------
 
[ ] CHECK HERE IF OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
    GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE
    FOLLOWING:
 
   Name of Registered Holder(s)
 
  ------------------------------------------------------------------------------
 
   Window Ticket Number (if any)
   ----------------------------------------------------------------------------
 
   Date of Execution of Notice of Guaranteed Delivery
   -------------------------------------------------------
 
   Name of Institution which guaranteed delivery
   --------------------------------------------------------------
 
   IF DELIVERED BY BOOK-ENTRY TRANSFER, COMPLETE THE FOLLOWING:
   Account Number:
   -----------------------------------------------------------------------------
 
   Transaction Code Number
   -----------------------------------------------------------------------------
 
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
    COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS
    THERETO.
 
  Name:
  ------------------------------------------------------------------------------
 
  Address:
  ------------------------------------------------------------------------------
<PAGE>   4
 
                    NOTE: SIGNATURES MUST BE PROVIDED BELOW
 
              PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
 
Ladies and Gentlemen:
 
     Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the aggregate principal amount of Old
Notes indicated above. Subject to, and effective upon, the acceptance for
exchange of the Old Notes tendered hereby, the undersigned hereby sells, assigns
and transfers to, or upon the order of the Company all right, title and interest
in and to such Old Notes, and hereby irrevocably constitutes and appoints the
Exchange Agent the true and lawful agent and attorney-in-fact of the undersigned
(with full knowledge that said Exchange Agent also acts as the agent of the
Company and as Trustee under the indenture governing the Old Notes and the New
Notes) with respect to such Old Notes, with full power of substitution (such
power of attorney being deemed to be an irrevocable power coupled with an
interest) to (a) deliver certificates representing such Old Notes, and to
deliver all accompanying evidences of transfer and authenticity to or upon the
order of the Company upon receipt by the Exchange Agent, as the undersigned's
agent, of the New Notes to which the undersigned is entitled upon the acceptance
by the Company of such Old Notes for exchange pursuant to the Exchange Offer,
(b) receive all benefits and otherwise to exercise all rights of beneficial
ownership of such Old Notes, all in accordance with the terms of the Exchange
Offer, and (c) present such Old Notes for transfer on the register for such Old
Notes.
 
     The undersigned acknowledges that prior to this Exchange Offer, there has
been no public market for the Old Notes or the New Notes. If a market for the
New Notes should develop, the New Notes could trade at a discount from their
principal amount. The undersigned is aware that the Company does not intend to
list the New Notes on a national securities exchange and that there can be no
assurance that an active market for the Exchange Note will develop.
 
     If the undersigned is not a broker-dealer, the undersigned represents that
it is not engaged in, and does not intend to engage in, a distribution of New
Notes. If the undersigned is a broker-dealer that will receive New Notes, it
represents that the Old Notes to be exchanged for New Notes were acquired as a
result of market-making activities or other trading activities and it
acknowledges that it will deliver a prospectus in connection with any resale of
such New Notes; however, by so acknowledging and by delivering a prospectus, the
undersigned will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
 
     The undersigned represents that (a) it is not an "affiliate," as defined
under Rule 405 of the Securities Act, of the Company, (b) it is not engaged in,
and does not intend to engage in, and has no arrangement or understanding with
any person to participate in, a distribution of the New Notes, and (c) it is
acquiring the New Notes in the ordinary course of business.
 
     The undersigned understands and acknowledges that the Company reserves the
right, in its sole discretion, to purchase or make offers for any Old Notes that
remain outstanding subsequent to the Expiration Date or to terminate the
Exchange Offer and, to the extent permitted by applicable law, purchase Old
Notes in the open market, in privately negotiated transactions or otherwise. The
terms of any such purchases or offers will differ from the terms of the Exchange
Offer.
 
     The undersigned hereby represents and warrants that (a) the undersigned
accepts the terms and conditions of the Exchange Offer, (b) the undersigned has
a net long position within the meaning of Rule 14e-4 under the Exchange Act
("Rule 14e-4") equal to or greater than the principal amount of Old Notes
tendered hereby, (c) the tender of such Old Notes complies with Rule 14e-4 (to
the extent that Rule 14e-4 is applicable to such exchange), (d) the undersigned
has full power and authority to tender, exchange, assign and transfer the Old
Notes tendered hereby, and (e) when the same are accepted for exchange by the
Company, the Company will acquire good and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not subject to
any adverse claim or right. The undersigned will, upon request, execute and
deliver any additional documents deemed by the Exchange Agent or the Company to
be necessary or desirable to complete the sale, assignment and transfer of the
Old Notes tendered hereby.
 
     The undersigned agrees that all authority conferred or agreed to be
conferred by this Letter of Transmittal and every obligation of the undersigned
hereunder shall be binding upon the successors, assigns, heirs, executors,
administrators, trustees in bankruptcy and legal representatives of the
undersigned and shall not be affected by, and shall survive, the
<PAGE>   5
 
death or incapacity of the undersigned. The undersigned also agrees that, except
as stated in the Prospectus, the Old Notes tendered hereby cannot be withdrawn.
 
     The undersigned understands that tenders of the Old Notes pursuant to any
one of the procedures described in the Prospectus under the caption "The
Exchange Offer -- Procedures for Tendering" and in the instructions hereto will
constitute a binding agreement between the undersigned and the Company in
accordance with the terms and subject to the conditions of the Exchange Offer.
 
     The undersigned understands that by tendering Old Notes pursuant to one of
the procedures described in the Prospectus and the instructions thereto, the
tendering holder will be deemed to have waived the right to receive any payment
in respect of interest on the Old Notes accrued up to the date of issuance of
the New Notes.
 
     The undersigned recognizes that, under certain circumstances set forth in
the Prospectus, the Company may not be required to accept for exchange any of
the Old Notes tendered. Old Notes not accepted for exchange or withdrawn will be
returned to the undersigned at the address set forth below unless otherwise
indicated under "Special Delivery Instructions" below.
 
     Unless otherwise indicated herein under the box entitled "Special Issuance
Instructions" below, New Notes, and Old Notes not validly tendered or accepted
for exchange, will be issued in the name of the undersigned. Similarly, unless
otherwise indicated under the box entitled "Special Delivery Instructions"
below, New Notes, and Old Notes not validly tendered or accepted for exchange,
will be delivered to the undersigned at the address shown below the signature of
the undersigned. The undersigned recognizes that the Company has no obligation
pursuant to the "Special Issuance Instructions" to transfer any Old Notes from
the name of the registered holder thereof if the Company does not accept for
exchange any of the principal amount of such Old Notes so tendered.
 
     All questions as to the validity, form, eligibility (including time of
receipt), and withdrawal of the tendered Old Notes will be determined by the
Company in its sole discretion, which determination will be final and binding.
The Company reserves the absolute right to reject any and all Old Notes not
properly tendered or any Old Notes the Company's acceptance of which would, in
the opinion of counsel for the Company, be unlawful. The Company also reserves
the right to waive any irregularities or conditions of tender as to particular
Old Notes. The Company's interpretation of the terms and conditions of the
Exchange Offer (including the instructions in this Letter of Transmittal) will
be final and binding. Unless waived, any defects or irregularities in connection
with tenders of Old Notes must be cured within such time as the Company shall
determine. Neither the Company, the Exchange Agent nor any other person shall be
under any duty to give notification of defects or irregularities with respect to
tenders of Old Notes, nor shall any of them incur any liability for failure to
give such notification. Tenders of Old Notes will not be deemed to have been
made until such irregularities have been cured or waived. Any Old Notes received
by the Exchange Agent that are not properly tendered and as to which the defects
or irregularities have not been cured or waived will be returned without cost to
such holder by the Exchange Agent to the tendering holders of Old Notes, unless
otherwise provided in this Letter of Transmittal, as soon as practicable
following the Expiration Date.
<PAGE>   6
 
     THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OLD NOTES"
ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED THE OLD NOTES AS
SET FORTH IN SUCH BOX ABOVE.
 
                                PLEASE SIGN HERE
                   (TO BE COMPLETED BY ALL TENDERING HOLDERS)
                  (COMPLETE ACCOMPANYING SUBSTITUTE FORM W-9)
 
Dated: __ , 1997
__x
__x
                       SIGNATURE(S) OF OWNER                      (DATE)
 
     If a holder is tendering any Old Notes, this Letter must be signed by the
registered holder(s) as the name(s) appear(s) on the Note(s) for the Old Notes
or by any person(s) authorized to become registered holder(s) by endorsements
and documents transmitted herewith. If signature is by a trustee, executor,
administrator, guardian, officer or other person acting in a fiduciary or
representative capacity, please set forth full title. See Instruction 3.
 
Name(s):
__
                             (PLEASE TYPE OR PRINT)
 
Capacity: __
 
Address: __
 
__
                              (INCLUDING ZIP CODE)
 
                              SIGNATURE GUARANTEE
                         (IF REQUIRED BY INSTRUCTION 3)
 
Signature(s) Guaranteed by
an Eligible Institution:
                             (AUTHORIZED SIGNATURE)
 
                                     TITLE
 
                                  NAME OF FIRM
 
Dated: , 1997__
<PAGE>   7
 
                         SPECIAL ISSUANCE INSTRUCTIONS
                           (SEE INSTRUCTIONS 3 AND 4)
 
     To be completed ONLY if Certificates for Old Notes not exchanged and/or New
Notes are to be issued in the name of and sent to someone other than the
person(s) whose signature(s) appear(s) on this Letter above, or if Old Notes
delivered by book-entry transfer which are not accepted for exchange are to be
returned by credit to an account maintained at the Book-Entry Transfer Facility
other than the account indicated above.
 
Issue New Notes and/or Old Notes to:
 
Name(s):
                                  (PLEASE TYPE OR PRINT)
 
                             (PLEASE TYPE OR PRINT)
 
Address:
                              (INCLUDING ZIP CODE)
 
  (Complete accompanying Substitute Form W-9) Credit unexchanged Old Notes
delivered by book-entry transfer to the Book-Entry Transfer Facility account set
forth below.
 
---------------------------------------------------------
                         (BOOK-ENTRY TRANSFER FACILITY
                         ACCOUNT NUMBER, IF APPLICABLE)
 
                         SPECIAL DELIVERY INSTRUCTIONS
                        (SEE INSTRUCTIONS 3 AND 4 AND 6)
 
     To be completed ONLY if Certificates for Old Notes not exchanged and/or New
Notes are to be sent to someone other than the person(s) whose signature(s)
appear(s) on this Letter above or to such person(s) at an address other than
shown in the box entitled "Description of Old Notes" on this Letter above.
 
Mail New Notes and/or Old Notes to:
 
Name(s)
                             (PLEASE TYPE OR PRINT)
 
                             (PLEASE TYPE OR PRINT)
 
Address
 
---------------------------------------------------------
                              (INCLUDING ZIP CODE)
<PAGE>   8
 
                        INSTRUCTIONS FORMING PART OF THE
                   TERMS AND CONDITIONS OF THE EXCHANGE OFFER
 
     1. DELIVERY OF THIS LETTER OF TRANSMITTAL AND CERTIFICATES; GUARANTEED
DELIVERY PROCEDURES. To be effectively tendered pursuant to the Exchange Offer,
the Old Notes, together with either an Agent's Message or a properly completed
Letter of Transmittal (or facsimile thereof), duly executed by the registered
holder thereof, and any other documents required by this Letter of Transmittal,
must be received by the Exchange Agent at one of its addresses set forth on the
first page of this Letter of Transmittal. If the beneficial owner of any Old
Notes is not the registered holder, then such person may validly tender his or
her Old Notes only by obtaining and submitting to the Exchange Agent a properly
completed Letter of Transmittal from the registered holder. OLD NOTES SHOULD BE
DELIVERED ONLY TO THE EXCHANGE AGENT AND NOT TO THE COMPANY OR TO ANY OTHER
PERSON.
 
     THE METHOD OF DELIVERY OF OLD NOTES AND ALL OTHER REQUIRED DOCUMENTS TO THE
EXCHANGE AGENT IS AT THE ELECTION AND RISK OF THE HOLDER. SUFFICIENT TIME SHOULD
BE ALLOWED TO ASSURE TIMELY DELIVERY TO THE EXCHANGE AGENT BY 5:00 P.M., NEW
YORK CITY TIME, ON THE EXPIRATION DATE.
 
     If a holder desires to tender Old Notes and such holder's Old Notes are not
immediately available or time will not permit such holder's Letter of
Transmittal, Old Notes or other required documents to reach the Exchange Agent
on or before the Expiration Date, such holder's tender may be effected if:
 
     (a) the tender is made through an Eligible Institution (as defined herein);
 
     (b) prior to the Expiration Date, the Exchange Agent receives from such
         Eligible Institution a properly completed and duly executed Notice of
         Guaranteed Delivery (by facsimile transmission, mail, Agent's Message
         or hand delivery) setting forth the name and address of the holder of
         the Old Notes, the certificate number or numbers of such Old Noes and
         the principal amount of Old Notes tendered, stating that the tender is
         being made thereby, and guaranteeing that, within three business days
         after the Expiration Date, the Letter of Transmittal (or facsimile
         thereof) together with the certificate(s) representing the Old Notes to
         be tendered in proper form for transfer or a Book-Entry Confirmation as
         the case may be, and any other documents required by the Letter of
         Transmittal will be deposited by the Eligible Institution with the
         Exchange Agent; and
 
     (c) such Agent's Message or properly completed and executed Letter of
         Transmittal (or facsimile thereof) together with the certificate(s)
         representing all tendered Old Notes in proper form for transfer and all
         other documents required by the Letter of Transmittal are received by
         the Exchange Agent within three business days after the Expiration
         Date.
 
     2. WITHDRAWAL OF TENDERS. Tendered Old Notes may be withdrawn at any time
prior to 5:00 p.m., New York City time, on the Expiration Date, unless
previously accepted for exchange.
 
     To be effective, a written or facsimile transmission notice of withdrawal
must (a) be received by the Exchange Agent at one of its addresses set forth on
the first page of this Letter of Transmittal prior to 5:00 p.m., New York City
time, on the Expiration Date, unless previously accepted for exchange, (b)
specify the name of the person who tendered the Old Notes, (c) contain the
description of the Old Notes to be withdrawn, the certificate numbers shown on
the particular certificates evidencing such Old Notes and the aggregate
principal amount represented by such Old Notes and (d) be signed by the holder
of such Old Notes in the same manner as the original signature appears on this
Letter of Transmittal (including any required signature guarantees) or be
accompanied by evidence sufficient to have the Trustee with respect to the Old
Notes register the transfer of such Old Notes into the name of the holder
withdrawing the tender. The signature(s) on the notice of withdrawal must be
guaranteed by an Eligible Institution unless such Old Notes have been tendered
(a) by a registered holder of Old Notes who has not completed either the box
entitled "Special Issuance Instructions" or the box entitled "Special Delivery
Instructions" on this Letter of Transmittal or (b) for the account of an
Eligible Institution. All questions as to the validity, form and eligibility
(including time of receipt) of such withdrawal notices shall be determined by
the Company, whose determination shall be final and binding on all parties. If
the Old Notes to be withdrawn have been delivered
<PAGE>   9
 
or otherwise identified to the Exchange Agent, a signed notice of withdrawal is
effective immediately upon receipt by the Exchange Agent of a written or
facsimile transmission notice of withdrawal even if physical release is not yet
effected. In addition, such notice must specify, in the case of Old Notes
tendered by delivery of certificates for such Old Notes, the name of the
registered holder (if different from that of the tendering holder) to be
credited with the withdrawn Old Notes. Withdrawals may not be rescinded, and any
Old Notes withdrawn will thereafter be deemed not validly tendered for purposes
of the Exchange Offer. However, properly withdrawn Old Notes may be retendered
by following one of the procedures described under "The Exchange
Offer -- Procedures for Tendering" in the Prospectus at any time on or prior to
the applicable Expiration Date.
 
     3. SIGNATURES ON THIS LETTER OF TRANSMITTAL, BOND POWERS AND ENDORSEMENTS;
GUARANTEE OF SIGNATURES. If this Letter of Transmittal is signed by the
registered holder(s) of the Old Notes tendered hereby, the signature must
correspond exactly with the name(s) as written on the face of the certificates
without any change whatsoever.
 
     If any Old Notes tendered hereby are owned of record by two or more joint
owners, all such owners must sign this Letter of Transmittal.
 
     If any Old Notes tendered hereby are registered in different names on
several certificates, it will be necessary to complete, sign and submit as many
separate copies of this Letter of Transmittal as there are different
registrations of certificates.
 
     When this Letter of Transmittal is signed by the registered holder or
holders specified herein and tendered hereby, no endorsements of certificates or
separate bond powers are required unless Exchange Notes are to be issued, or
certificates for any untendered principal amount of Old Notes are to be
reissued, to a person other than the registered holder.
 
     If this Letter of Transmittal is signed by a person other than the
registered holder(s) of any certificate(s) specified herein, such certificate(s)
must be endorsed or accompanied by appropriate bond powers, in either case
signed exactly as the name(s) of the registered holder(s) appear(s) on the
certificate(s).
 
     If this Letter of Transmittal or a Notice of Guaranteed Delivery or any
certificates or bond powers are signed by trustees, executors, administrators,
guardians, attorneys-in-fact, officers of corporations or others acting in a
fiduciary or representative capacity, such persons should so indicate when
signing, and unless waived by the Company, evidence satisfactory to the Company
of their authority so to act must be submitted with this Letter of Transmittal.
 
     Except as described below, signatures on this Letter of Transmittal or a
notice of withdrawal, as the case may be, must be guaranteed by an Eligible
Institution. Signatures on this Letter of Transmittal or a notice of withdrawal,
as the case may be, need not be guaranteed if the Old Notes tendered pursuant
hereto are tendered (a) by a registered holder of Old Notes who has not
completed either the box entitled "Special Issuance Instructions" or the box
entitled "Special Delivery Instructions" on this Letter of Transmittal or (b)
for the account of an Eligible Institution. In the event that signatures on this
Letter of Transmittal or a notice of withdrawal, as the case may be, are
required to be guaranteed, such guarantee must be by a firm which is a member of
a registered national securities exchange or a member of the National
Association of Securities Dealers, Inc. or by a commercial bank or trust company
having an office of correspondent in the United States (each as "Eligible
Institutions").
 
     Endorsements on certificates for Old Notes or signatures on bond powers
required by this Instruction 3 must be guaranteed by an Eligible Institution.
 
     4. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. Tendering holders should
indicate in the applicable box the name and address to which certificates for
Exchange Notes and/or substitute certificates evidencing Old Notes for the
principal amounts not exchanged are to be issued or sent, if different from the
name and address of the person signing this Letter of Transmittal. In the case
of issuance in a different name, the employer identification or social security
number of the person named must also be
<PAGE>   10
 
indicated. If no such instructions are given, any Old Notes not exchanged will
be returned to the name and address of the person signing this Letter of
Transmittal.
 
     5. TAX IDENTIFICATION NUMBER WITHHOLDING Federal income tax law of the
United States requires that a holder of Old Notes whose Old Notes are accepted
for exchange provide the Company with the holder's correct taxpayer
identification number, which, in the case of a holder who is an individual, is
his or her social security number, or otherwise establish an exemption from
backup withholding. If the Company is not provided with the correct taxpayer
identification number, the exchange holder of Old Notes may be subject to a $50
penalty imposed by the Internal Revenue Service (the "IRS"). In addition,
interest on the New Notes acquired pursuant to the Exchange Offer may be subject
to backup withholding in an amount equal to 31% of any interest payment. If
withholding occurs and results in an overpayment of taxes, a refund may be
obtained.
 
     To prevent backup withholding, an exchanging holder of Old Notes must
provide his correct taxpayer identification number by completing the Substitute
Form W-9 provided in this Letter of Transmittal, certifying that the taxpayer
identification number provided is correct (or that the exchanging holder of Old
Notes is awaiting a taxpayer identification number) and that either (a) the
exchanging holder has not yet been notified by the IRS that such holder is
subject to backup withholding as a result of failure to report all interest or
dividends or (b) the IRS has notified the exchanging holder that such holder is
no longer subject to backup withholding.
 
     Certain exchanging holders of Old Notes (including, among others, all
corporations and certain foreign individuals) are not subject to these backup
withholding requirements. A foreign individual and other exempt holders other
than foreign individuals (e.g., corporations) should certify to such exempt
status on the Substitute Form W-9 provided in this Letter of Transmittal.
Foreign individuals should complete and provide Form W-8 to indicate their
foreign status.
 
     6. TRANSFER TAXES. Holders tendering pursuant to the Exchange Offer will
not be obligated to pay brokerage commissions or fees or to pay transfer taxes
with respect to their exchange under the Exchange Offer unless the box entitled
"Special Issuance Instructions" in this Letter of Transmittal has been
completed, or unless the Exchange Notes are to be issued to any person other
than the holder of the Old Notes tendered for exchange. The Company will pay all
other charges or expenses in connection with the Exchange Offer. If holders
tender Old Notes for exchange and the Exchange Offer is not consummated,
certificates representing the Old Notes will be returned to the holders at the
Company's expense.
 
     Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the certificate(s) specified in this Letter
of Transmittal.
 
     7. INADEQUATE SPACE. If the space provided herein is inadequate, the
aggregate principal amount of the Old Notes being tendered and the certificate
numbers (if available) should be listed on a separate schedule attached hereto
and separately signed by all parties required to sign this Letter of
Transmittal.
 
     8. PARTIAL TENDERS. Tenders of Old Notes will be accepted only in integral
multiples of $1,000. If tenders are to be made with respect to less than the
entire principal amount of any Old Notes, fill in the total principal amount of
Outstanding Notes which are tendered in the appropriate box on the cover
entitled "Description of Old Notes Tendered." In the case of partial tenders,
new certificates representing the Outstanding Notes in fully registered form for
the remainder of the principal amount of the Old Notes will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise indicated in the
appropriate place on this Letter of Transmittal, as promptly as practicable
after the expiration or termination of the Exchange Offer.
 
     9. MUTILATED, LOST, STOLEN OR DESTROYED OLD NOTES. Any holder whose Old
Notes have been mutilated, lost, stolen or destroyed should contact the Exchange
Agent at the address indicated above for further instructions.
 
     10. REQUEST FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance or
additional copies of the Prospectus or this Letter of Transmittal may be
obtained from the Exchange Agent at its telephone number set forth on the first
page of this Letter of Transmittal.
<PAGE>   11
 
--------------------------------------------------------------------------------
                       PAYER'S NAME:
--------------------------------------------------------------------------------
 
                           -----------------------------------------------------
 
                           -----------------------------------------------------
 
 SUBSTITUTE
 
 FORM W-9
 DEPARTMENT OF THE TREASURY
 INTERNAL
 
 REVENUE SERVICE PAYER'S
 REQUEST FOR TAXPAYER
 IDENTIFICATION NUMBER (TIN)
 
                                                   SOCIAL SECURITY NUMBER OR
                                                   EMPLOYER IDENTIFICATION
                                                   NUMBER
 
                                                   ----------------------------
 
                                                   PART III -- Awaiting TIN [ ]
 
                           CERTIFICATE INSTRUCTIONS -- You must cross out item
                           (2) in Part 2 above if you have been notified by the
                           IRS that you are subject to backup withholding
                           because of underreporting interest or dividends on
                           your tax return. However, if after being notified by
                           the IRS that you were subject to backup withholding
                           you received another notification from the IRS
                           stating that you are no longer subject to backup
                           withholding, do no not cross out item (2).
--------------------------------------------------------------------------------
 
 SIGNATURE                                  DATE
--------------------------------------------------------------------------------
 
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
      OF 31% OF ANY PAYMENTS MADE TO HOLDERS OF NEW NOTES PURSUANT TO THE
      EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF
      TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL
      DETAILS.
 
      YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART
      3 OF SUBSTITUTE FORM W-9.
--------------------------------------------------------------------------------
 
             CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
 
     I certify under penalties of perjury that a taxpayer identification number
 has not been issued to me, and either (a) I have mailed or delivered an
 application to receive a taxpayer identification number to the appropriate
 Internal Revenue Service Center or Social Security Administration Office or
 (b) I intend to mail or deliver an application in the near future. I
 understand that if I do not provide a taxpayer identification number within 60
 days, 31 percent of all payments made to me thereafter will be withheld until
 I provide a number.
 
<TABLE>
  <S>                                                                 <C>
                         Signature                                                              Date
</TABLE>
 
--------------------------------------------------------------------------------
 
PART I -- PLEASE PROVIDE YOUR TIN IN THE BOX AT
                            RIGHT AND CERTIFY BY
                            SIGNING AND DATING
                            BELOW
 
PART II -- Certification -- Under Penalties of
                            Perjury, I certify
                            that:
 
(1) The number shown on this form is my correct
    Taxpayer Identification Number (or I am waiting
    for a number to be issued to me) and
 
(2) I am not subject to backup withholding either
    because I have not been notified by the
    Internal Revenue Service ("IRS") that I am
    subject to backup withholding as a result of
    failure to report all interest or dividends, or
    the IRS has notified me that I am no longer
    subject to backup withholding.
