Document:

exhibit.htm

 

 

Exhibit 10.12

 

 

 

Pioneer Exploration Inc.

750 West Pender Street, Suite 202

Vancouver, British Columbia

V6C 2T7

October 7, 2011

Angelo Scola

10 Yosemite Valley Road

Watch Hill, Rhode Island

02891

Attention:  Angelo Scola

Dear Sirs:

Re:  IBA Green Inc. - Share Purchase

This letter will confirm our numerous discussions concerning the proposed purchase of all of the shares of IBA Green Inc. (“IBA”).

This Letter Agreement sets forth the terms and conditions of the proposed purchase, which, when accepted by you, will form a binding agreement among us, such agreement to be embodied in due course in a more formal agreement (the “Formal Agreement”).

Background

For the purposes of our proposed acquisition, we have each relied upon the following information:

	
(a)

	
IBA is a Delaware corporation duly organized and validly subsisting and in good standing;

	
(b)

	
Pioneer Exploration Inc. is a Nevada corporation duly organized and validly subsisting and is a SEC reporting company in good standing;

	
(c)

	
there are no options, rights or other agreements to purchase any or all of the shares issued and outstanding in the capital of IBA (the “Shares”), and you have not granted anyone else the right to purchase any of the Shares;

	
(d)

	
except for accounts payable incurred in the ordinary course of IBA’s business and any loan payments owed by IBA before or after the signing of this Letter Agreement (the “Loan”), there are no known liabilities, contingent or otherwise, affecting IBA; and

	
(e)

	
you are the sole officer, director, and shareholder of IBA.

Proposed Acquisition

Based on the foregoing information, we agree as follows:

	
1.

	
We will purchase from you all of the Shares.  Included in the business assets at the time of purchase will be the Loan, if any, and all cash, property, contracts, equipment, goodwill, intellectual property, including all patents registered in the name of IBA or the name of any affiliate, and other assets used in or related to the business of IBA (collectively the “Assets”).

 

 

 

  

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2.

	
As payment for the aggregate purchase price of the Shares and the assumption of the Loan, if any, we will issue up to a maximum of 38.5 million restricted common shares of Pioneer Exploration Inc., with an allocation to be agreed upon and contained within the Formal Agreement.

	
3.

	
You or your nominee will be appointed to our Board of Directors.

	
4.

	
It is understood that contained in the Formal Agreement will be the normal and usual covenants and warranties for a transaction of this nature, including among other things, but without limitation, the ownership of the Assets and the Shares, and the right of you to sell the Shares.  The Formal Agreement will also disclose and contain warranties concerning, without limitation, the nature of ownership of and good title to the Assets; the holdings of permits, licences, consents and authorities necessary for the use of the Assets and to carry on the business; all purchase orders and other obligations dealing with the Assets; and all outstanding guarantees and performance bonds attached to the Assets.

	
5.

	
The Formal Agreement will also contain customary conditions precedent to closing, including, without limitation, the following:

	
a.  

	
We will conduct our due diligence on the Shares and the Assets and evaluate the Shares and Assets and obtain satisfactory results from our due diligence and evaluation.

	
b.  

	
We will complete the due diligence and evaluation within 45 calendar days of the date this Letter Agreement is accepted by you.

	
c.  

	
You and IBA will obtain any required consents for the transfer of title of the Shares.

	
d.  

	
Prior to closing, you will provide audited financial statement of IBA for a period to be determined by our auditor.

	
  

	
e.

	
We will agree to use our best efforts to raise $1.5 million for financing the development of the Assets and the operation of the business once the Shares have been acquired by us.

	
  

	
The Formal Agreement will provide that if these conditions are not fulfilled or waived prior to closing, the obligations of the parties thereunder will be null and void unless the fulfilment of any such condition was not reasonably capable of being performed.

	
6.

	
Pending the closing of the transaction, we and our representatives will have, at reasonable times and with minimal disruption, access to IBA and to its books and records, financial and operating data, material contracts and other information with respect to the business as we will reasonably request.

	
7.

	
All information will be kept confidential and will be divulged by the parties only to their respective principals and professional advisors.

	
8.

	
Prior to execution of the Formal Agreement and so long as negotiations on this proposal continue and are being pursued in good faith, you agree neither to solicit expressions of interest nor offers from any other parties concerning the sale of the Shares or the Assets nor to negotiate same or to take any steps in furtherance thereof.

Miscellaneous

	
9.

	
Each of the parties hereby will pay their own costs, expenses and fees (including, without limitation, legal counsel) incurred in connection with the preparation, execution and the consummation of this Letter Agreement and the Formal Agreement.

 

  

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10.

	
This Letter Agreement and the Formal Agreement will be interpreted in accordance with the laws of the Province of British Columbia and will enure to the benefit of and be binding upon us and you and our respective heirs, successors and permitted assigns.

	
11.

	
All parties agree to sign such further and other deeds and documents, including without limitation, the Formal Agreement and to give such further and other assurances as may be necessary to fully implement this Letter Agreement.

	
12.

	
If the foregoing accurately sets forth your understanding of our agreement, please sign this Letter Agreement where indicated below which will then form a binding agreement among us, subject only to the terms and conditions aforesaid.  We will then immediately begin our due diligence and preparation of the Formal Agreement.

Yours truly,

Pioneer Exploration Inc.

Per:           /s/ Tom
Brady                                                                                                           c/s

  Tom Brady - President

ACCEPTED AND AGREED TO
THIS                                                                           7TH            DAY OF OCTOBER, 2011:

/s/ Angelo Scola

  Angelo Scola

  

Page - 3Exh 4.1

Exhibit 4.1
                                                                                                                               EXECUTION VERSION
PUBLIC SERVICE COMPANY OF NEW MEXICO
TO
UNION BANK, N.A.
Trustee

___________________________________________________________

FOURTH SUPPLEMENTAL INDENTURE
Dated as of October 12, 2011
To
INDENTURE
Dated as of August 1, 1998

___________________________________________________________
Providing for
5.35%  Senior Unsecured Notes due 2021

                                                                                                                                                                                     00099780.8

FOURTH SUPPLEMENTAL INDENTURE, dated as of October 12, 2011, between Public Service Company of New Mexico, a New Mexico corporation (the “Company”), having its principal office at Alvarado Square, Albuquerque, New Mexico 87158, and UNION BANK, N.A., a national banking association (successor to The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.) (successor to JPMorgan Chase Bank, N.A. (formerly JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank)))), as Trustee (the “Trustee”) under the Indenture, dated as of August 1, 1998, between the Company and the Trustee (the “Indenture”).
RECITALS OF THE COMPANY
The Company has executed and delivered the Indenture to the Trustee to provide for the issuance from time to time of its senior notes (the “Notes”), said Notes to be issued in one or more series as in the Indenture provided.

The Company has executed and delivered to the Trustee a First Supplemental Indenture, dated as of August 1, 1998, between the Company and the Trustee to establish the forms and terms of two series of Notes, a Second Supplemental Indenture, dated as of September 1, 2003, between the Company and the Trustee to establish the form and terms of one series of Notes, and a Third Supplemental Indenture, dated as of May 13, 2008, between the Company and the Trustee, among other things, to establish the form and terms of one series of Notes (the Indenture, as supplemented and amended by said First Supplemental Indenture, said Second Supplemental Indenture, and said Third Supplemental Indenture, the “Indenture, as heretofore supplemented”).

Effective as of June 1, 2011, Union Bank, N.A. succeeded to The Bank of New York Mellon Trust Company, N.A. as Trustee.  Effective as of October 1, 2006, The Bank of New York Mellon Trust Company, N.A. (under its then name, The Bank of New York Trust Company, N.A.) succeeded to JPMorgan Chase Bank, N.A. (formerly JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank)) as Trustee.
Pursuant to the terms of the Indenture, the Company desires to provide for the establishment of a new series of its Notes to be known as its 5.35% Senior Unsecured Notes due 2021 (herein called the “2011 Notes”), the form and substance of the 2011 Notes and the terms, provisions, and conditions thereof to be set forth as provided in the Indenture, as heretofore supplemented, and this Fourth Supplemental Indenture.

Section 9.01 of the Indenture provides that, without the consent of any Holders, the Company, when authorized by or pursuant to a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental to the Indenture, as heretofore supplemented, as provided in Section 9.01 of the Indenture, as heretofore supplemented, and the Company desires to amend the Indenture, as heretofore supplemented, as hereinafter provided, and has requested that the Trustee join in the execution and delivery hereof.
All things necessary to make this Fourth Supplemental Indenture a valid, binding and enforceable agreement of the Company, and to make the 2011 Notes, when executed by the 

Company and authenticated and delivered by the Trustee, the valid obligations of the Company have been done.
NOW, THEREFORE, THIS FOURTH SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the 2011 Notes by the Holders thereof, and for the purpose of setting forth, as provided in the Indenture, the form and substance of the 2011 Notes and the terms, provisions, and conditions thereof, it is mutually agreed, for the equal and proportionate benefit of all Holders of the 2011 Notes as follows:
ARTICLE I

GENERAL TERMS AND CONDITIONS OF
THE 2011 NOTES
Section 1.01  There shall be and is hereby authorized a series of Notes designated the “5.35% Senior Unsecured Notes due 2021”.  The 2011 Notes shall initially be authenticated and delivered in the aggregate principal amount of $160,000,000.  The 2011 Notes shall mature and the principal thereof shall be due and payable together with all accrued and unpaid interest thereon on October 1, 2021.  The Company may issue, without the consent of the Holders of the 2011 Notes, additional 2011 Notes from time to time in accordance with Section 3.01 hereof.  Any such additional 2011 Notes shall have identical terms as the 2011 Notes, unless otherwise determined by the Company with respect to their original date of issuance, their original interest accrual date, and their original Interest Payment Date.  Any such additional 2011 Notes, together with the other 2011 Notes, shall constitute a single series for purposes of the Indenture.
Section 1.02  The 2011 Notes shall be issued in fully registered form without coupons, initially as one or more Global Notes to and registered in the name of Cede & Co., as nominee of The Depository Trust Company, as Depositary therefor.  Any 2011 Notes to be issued or transferred to, or to be held by, Cede & Co. (or any successor thereof) for such purpose shall bear the depositary legend in substantially the form set forth in the second paragraph at the top of the form of 2011 Note in Article II hereof (in addition to that set forth in Section 2.04 of the Indenture), unless otherwise agreed by the Company, such agreement to be confirmed in writing to the Trustee.  Each such Global Note may be exchanged in whole or in part for a 2011 Note registered, and any transfer of such Global Note in whole or in part may be registered, in the name or names of Persons other than such Depositary or a nominee thereof only under the circumstances set forth in Clause (2) of the last paragraph of Section 3.05 of the Indenture, or such other circumstances in addition to or in lieu of those set forth in Clause (2) of the last paragraph of Section 3.05 of the Indenture as to which the Company shall agree, such agreement to be confirmed in writing to the Trustee.  
Section 1.03  Each 2011 Note will bear interest at the rate of 5.35% per annum, from October 12, 2011 or from the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, payable semi-annually in arrears on October 1 and April 1 in each year (each an “Interest Payment Date”), commencing April 1, 2012 until the principal thereof is paid or made available for payment.  The interest so payable on a 2011 

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Note, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name such 2011 Note or any Predecessor Note is registered at the close of business on the Regular Record Date for such interest, which shall be the second Business Day immediately preceding the applicable Interest Payment Date.  Any such installment of interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name such 2011 Note or any Predecessor Note is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of the 2011 Notes not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the 2011 Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture.
The amount of interest payable on the 2011 Notes for any period will be computed on the basis of a 360-day year of twelve 30-day months.  In the event that any Interest Payment Date, Redemption Date or Stated Maturity of any 2011 Note is not a Business Day, then payment of interest or principal (and premium, if any) payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), in each case with the same force and effect as if made on such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.
As used in this Fourth Supplemental Indenture, “Business Day” means any day, other than (i) a Saturday or Sunday, (ii) a day on which banking institutions in The City of New York are authorized or required by law, regulation, or executive order to remain closed, or (iii) a day on which the Corporate Trust Office of the Trustee is closed for business.
Section 1.04  Payment of the principal of, and premium, if any, and interest on the 2011 Notes shall be payable, and registration of transfer and exchanges of the 2011 Notes may be effected at the office or agency of the Company maintained for that purpose in The City and State of New York, which shall be the Corporate Trust Office of the Trustee or at such other office or agency in The City of New York and State of New York as may be designated for such purpose by the Company from time to time; and such payment shall be made in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Note Register.  Notices and demands to or upon the Company in respect of the 2011 Notes and the Indenture may be served at the office or agency of the Company maintained for that purpose, which initially shall be the Corporate Trust Office of the Trustee.

Section 1.05      The Company, at its option, may redeem at any time all, or from time to time, any part of the 2011 Notes on not less than 30 days nor more than 60 days notice as provided in the Indenture (except that, in respect of any redemption referred to below in Paragraph A of this Section 1.05, notwithstanding the provisions of Section 11.04 of the Indenture, any notice of redemption for the 2011 Notes given pursuant to said Section need not set forth the Redemption Price but only the manner of calculation thereof) at a Redemption Price equal to:

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A. in the event of any redemption, the Redemption Date in respect of which occurs prior to July 1, 2021, the greater of the following amounts: 
(i)    100% of the principal amount of the 2011 Notes then Outstanding to be so redeemed; and
(ii)    the sum of the present values of the remaining scheduled payments of principal amount and interest on the 2011 Notes to be redeemed (not including any portion of payments of interest accrued as of the applicable Redemption Date), discounted to the applicable Redemption Date in accordance with customary market practice on a semi-annual basis at a rate equal to the sum of the Treasury Rate plus 0.50%, 
plus, in either of the above cases, accrued and unpaid interest on the principal amount being redeemed to the applicable Redemption Date; or
B. in the event of any redemption, the Redemption Date in respect of which occurs on or after July 1, 2021, 100% of the principal amount of the 2011 Notes then Outstanding to be so redeemed, plus accrued and unpaid interest on the principal amount being redeemed to the applicable Redemption Date.
The Redemption Price referred to in Paragraph A of this Section 1.05 shall be calculated by the Independent Investment Banker assuming a 360-day year consisting of twelve 30-day months.
For purposes of Paragraph A of this Section 1.05, the following terms will have the meanings set forth below.
“Comparable Treasury Issue” means the U.S. Treasury security or securities selected by the Independent Investment Banker as having a maturity comparable to the remaining term of the 2011 Notes to be redeemed that would be used, at the time of selection and in accordance with customary market practice, in pricing new issues of corporate debt securities of a comparable maturity to the remaining term of such 2011 Notes. 
“Comparable Treasury Price” means, with respect to any Redemption Date:
(i)    the bid-side for the Comparable Treasury Issue as of the third Business Day preceding the Redemption Date, as set forth in the daily statistical release (or any successor release) published by The Wall Street Journal in the table entitled “Treasury Bonds, Notes, and Bills,” as determined by the Independent Investment Banker, or
(ii)    if such release (or any successor release) is not published or does not contain such prices on such Business Day: 
(x)    the average of the Reference Treasury Dealer Quotations for that Redemption Date, after excluding the highest and lowest of the Reference Treasury Dealer Quotations, 

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(y)    if the Independent Investment Banker obtains fewer than four Reference Treasury Dealer Quotations, the average of all Reference Treasury Dealer Quotations so received, or
(z)    if only one Reference Treasury Dealer Quotation is received, such quotation.
“Independent Investment Banker” means one of the Reference Treasury Dealers selected by the Company.
“Reference Treasury Dealer” means each of four primary U.S. Government securities dealers in New York City (each a "Primary Treasury Dealer"), consisting of (i) J.P. Morgan Securities LLC (or its affiliate), (ii) one Primary Treasury Dealer selected by Mitsubishi UFJ Securities (USA), Inc. (or its affiliate), and (iii) two other nationally recognized investment banking firms (or their affiliates) that are selected by the Company in connection with the particular redemption, and their respective successors, provided that if any of them ceases to be a Primary Treasury Dealer, the Company will substitute another nationally recognized investment banking firm (or its affiliate) that is a Primary Treasury Dealer.
 “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed as a percentage of its principal amount) quoted in writing to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day preceding that Redemption Date.
“Treasury Rate” means, with respect to any Redemption Date, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated on the third Business Day preceding the applicable Redemption Date, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that Redemption Date.
The Independent Investment Banker shall give to the Company and the Trustee written notice of any Redemption Price referred to in Paragraph A of this Section 1.05 applicable to the 2011 Notes promptly after its calculation thereof.
The Trustee shall be under no duty to inquire into, may conclusively presume the correctness of, and shall be fully protected in relying upon the Independent Investment Banker's calculation of any Redemption Price referred to in Paragraph A of this Section 1.05, and shall have no responsibility for such calculation.
If less than all of the 2011 Notes are to be redeemed, the Trustee shall select by lot, on a pro-rata basis or in such other manner as it shall deem appropriate and fair, the particular 2011 Notes or portions thereof to be redeemed.  Notice of redemption shall be given by mail not less than 30 nor more than 60 days prior to the Redemption Date to the Holders of 2011 Notes to be redeemed (which, as long as the 2011 Notes are held in the book-entry only system, will be The Depository Trust Company (or its nominee) or a successor Depositary); provided, however, that the failure to duly give such notice by mail, or any defect therein, shall not affect the validity of 

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any proceedings for the redemption of 2011 Notes as to which there shall have been no such failure or defect.  Such notice may state that such redemption shall be conditional upon receipt by the Paying Agent or Agents for such 2011 Notes, on or prior to the Redemption Date, of money sufficient to pay the principal of and premium, if any, and interest, if any, on such 2011 Notes and that if such money shall not have been so received such notice shall be of no force or effect and the Company shall not be required to redeem such 2011 Notes.  On and after the Redemption Date (unless the Company shall default in the payment of the 2011 Notes or portions thereof to be redeemed at the applicable Redemption Price, together with interest accrued thereon to such date), interest on the 2011 Notes or the portions thereof so called for redemption shall cease to accrue.
Section 1.06    The 2011 Notes will not be subject to any sinking fund.
Section 1.07    The 2011 Notes are subject to defeasance pursuant to and in accordance with Section 13.02 and Section 13.03 of the Indenture. 
Section 1.08    Regulatory Statement.  Pursuant to the terms of an order issued by the New Mexico Public Regulation Commission each of the Company and its corporate parent, PNM Resources, Inc. (“Parent”), is required to include the following covenants in any debt instrument:
The Company and its Parent are being operated as separate corporate and legal entities.  In agreeing to make loans to Parent, Parent's lenders are relying solely on the creditworthiness of Parent based on the assets owned by Parent, and the repayment of the loan will be made solely from the assets of Parent and not from any assets of the Company; and the Parent's lenders will not take any steps for the purpose of procuring the appointment of an administrative receiver or the making of an administrative order for instituting any bankruptcy, reorganization, insolvency, wind up or liquidation or any like proceeding under applicable law in respect of the Company.
ARTICLE II
FORM OF 2011 NOTES
Section 2.01  The 2011 Notes and the Trustee's certificate of authentication to be endorsed thereon are to be substantially in the following form:
Form of 2011 Note.
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.  THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

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UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO PUBLIC SERVICE COMPANY OF NEW MEXICO OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Form of Face of 5.35% Senior Unsecured Notes due 2021.
PUBLIC SERVICE COMPANY OF NEW MEXICO
5.35% Senior Unsecured Notes due 2021
No. ________                                            $________
        CUSIP No. ________
                            ISIN No. _________        
PUBLIC SERVICE COMPANY OF NEW MEXICO, a corporation duly organized and existing under the laws of New Mexico (herein called the “Company”, which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to _________, or registered assigns, the principal sum of ________ Dollars on October 1, 2021 and to pay interest thereon from October 12, 2011 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually on October 1 and April 1 in each year, commencing April 1, 2012 at the rate of 5.35% per annum, until the principal hereof is paid or made available for payment.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the Regular Record Date for such interest, which shall be the second Business Day immediately preceding the applicable Interest Payment Date.  Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Notes of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.
Payment of the principal of (and premium, if any) and interest on this Note will be made at the office or agency of the Company maintained for that purpose in The City of New York, in 

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such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Note Register.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.
PUBLIC SERVICE COMPANY OF NEW MEXICO
By:_________________________________________    
[Name:]
[Title:]
Attest:
_______________________________________    
[Assistant] Secretary
Form of Trustee's Certificate of Authentication.
CERTIFICATION OF AUTHENTICATION
This is one of the Notes of the series designated therein referred to in the within-mentioned Indenture. 

Dated: 
UNION BANK, N.A., as Trustee
By:______________________________________    
Authorized Signatory
Form of Reverse of 5.35% Senior Unsecured Notes due 2021.

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This Note is one of a duly authorized issue of senior notes of the Company (herein called the “Notes”), issued and to be issued in one or more series under an Indenture, dated as of August 1, 1998, as supplemented and amended (herein, together with any amendments thereto, called the “Indenture”, which term shall have the meaning assigned to it in such instrument), between the Company and Union Bank, N.A., a national banking association (successor to The Bank of New York Mellon Trust Company, N.A. (formerly The Bank of New York Trust Company, N.A.) (successor to JPMorgan Chase Bank, N.A. (formerly JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank))), as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), and reference is hereby made to the Indenture, including the Fourth Supplemental Indenture, dated as of October 12, 2011 (the “Fourth Supplemental Indenture”), creating the series designated on the face hereof, for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and delivered.  This Note is one of the series designated on the face hereof to be authenticated and delivered in an unlimited aggregate principal amount. 
The Company, at its option, may redeem all, or from time to time, any part of the Notes of this series at the then applicable Redemption Price set forth in the Fourth Supplemental Indenture and upon the other terms and conditions therein and in the Indenture provided.
The Notes of this series will not be subject to any sinking fund.
In the event of redemption of this Note in part only, a new Note or Notes of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof. 
The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Note or certain restrictive covenants and Events of Default with respect to this Note, in each case upon compliance with certain conditions set forth in the Indenture.
If an Event of Default with respect to Notes of this series shall occur and be continuing, the principal of the Notes of this series may be declared due and payable in the manner and with the effect provided in the Indenture.
The Indenture permits the Company and the Trustee to enter into one or more supplemental indentures for certain purposes as therein provided without the consent of any Holders.  In addition, the Indenture permits, with certain exceptions as therein provided, the Company and the Trustee to enter into one or more supplemental indentures for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, the Indenture with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes of all series then Outstanding under the Indenture, considered as one class; provided, however, that if there shall be Notes of more than one series Outstanding under the Indenture and if a proposed supplemental indenture shall directly affect the rights of the Holders of Notes of one or more, but less than all, of such series, then the consent only of the Holders of a majority in aggregate principal amount of the Outstanding Notes of all series so directly affected, considered as one class, shall be required; and provided, further, that if the Notes of any series shall have been issued in more than one Tranche and if the proposed supplemental indenture shall directly 

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affect the rights of the Holders of Notes of one or more, but less than all, of such Tranches, then the consent only of the Holders of a majority in aggregate principal amount of the Outstanding Notes of all Tranches so directly affected, considered as one class, shall be required.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Notes of each, or all series, as the case may be, then Outstanding under the Indenture, on behalf of the Holders of all Notes of such series, to waive compliance by the Company with certain provisions of the Indenture and permitting the Holders of specified percentages in principal amount of the Notes of each series Outstanding under the Indenture, on behalf of the Holders of all Notes of such series, to waive certain past defaults under the Indenture and their consequences, provided, however, that if any such past default affects more than one series of Notes, the Holders of a majority in aggregate principal amount of the Outstanding Notes of all such series, considered as one class, shall have the right to waive such past default, and not the Holders of the Notes of any one such series.  Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.
As provided in and subject to the provisions of the Indenture, the Holder of this Note shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Notes of this series, the Holders of not less than a majority in aggregate principal amount of the Notes of all series at the time Outstanding in respect of which an Event of Default shall have occurred and be continuing shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not have received from the Holders of a majority in principal amount of Notes of all series at the time Outstanding in respect of which an Event of Default shall have occurred and be continuing a direction inconsistent with such request, and shall have failed to institute any such proceeding, for 60 days after receipt of such notice, request and offer of indemnity.  The foregoing shall not apply to any suit instituted by the Holder of this Note for the enforcement of any payment of principal hereof or any premium or interest hereon on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Note at the times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the Note Register, upon surrender of this Note for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Note are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Note Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or 

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more new Notes of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.
The Notes of this series are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.  
As used in this Note, “Business Day” means any day other than (i) a Saturday or a Sunday, (ii) a day on which banking institutions in The City of New York are authorized or required by law, regulation, or executive order to remain closed, or (iii) a day on which the Corporate Trust Office of the Trustee is closed for business.  Unless otherwise defined herein, all other terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.
ARTICLE III
ORIGINAL ISSUE OF 2011 NOTES
Section 3.01   2011 Notes in the aggregate principal amount of $160,000,000, and additional 2011 Notes as in Section 1.01 of this Fourth Supplemental Indenture provided, may, upon execution of this Fourth Supplemental Indenture, or from time to time thereafter, be executed on behalf of the Company by any officer or employee authorized to do so by a Board Resolution, under its corporate seal affixed thereto or reproduced thereon attested by its Secretary or by one of its Assistant Secretaries and delivered to the Trustee for authentication, and the Trustee shall thereupon authenticate and deliver said 2011 Notes in accordance with a Company Order delivered to the Trustee by the Company, all pursuant to and in accordance with Section 3.03 of the Indenture, as heretofore supplemented.
ARTICLE IV
PAYING AGENT AND REGISTRAR
Section 4.01  Union Bank, N.A. will be the Paying Agent and Note Registrar for the 2011 Notes.  
ARTICLE V

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AMENDMENT
Section 5.01.    The Indenture, as heretofore supplemented, is hereby amended by deleting the defined term “Corporate Trust Office” in Section 1.01 in its entirely and replacing it with the following: 

“'Corporate Trust Office' means the office of the Trustee at which at any particular time its corporate trust business in Los Angeles, California shall be principally administered, which office as of the date of this instrument is located at 120 S. San Pedro Street, Ste 400, Los Angeles, CA 90012, except that with respect to presentation of Notes for payment or for registration of transfer or exchange, such term shall mean the office or agency of the Trustee at which at any particular time its corporate trust or agency business shall be conducted, which office or agency at the date of this instrument is located at Union Bank, N.A. 1251 Avenue of the Americas, 19th Floor, New York, New York, 10020, Attention: Corporate Trust, or, in the case of any of such office or agency, such other address as the Trustee may designate from time to time by notice to the Holders and the Company.”

ARTICLE VI
SUNDRY PROVISIONS
Section 6.01    Except as otherwise expressly provided in this Fourth Supplemental Indenture or in the form of 2011 Notes or otherwise clearly required by the context hereof or thereof, all terms used herein or in said form of the 2011 Notes that are defined in the Indenture shall have the several meanings respectively assigned to them thereby.
Section 6.02    The Indenture, as heretofore supplemented and as supplemented and amended by this Fourth Supplemental Indenture, is in all respects ratified and confirmed, and this Fourth Supplemental Indenture shall be deemed part of the Indenture in the manner and to the extent herein and therein provided.
Section 6.03    The Trustee hereby accepts the trusts herein declared, provided, created, supplemented, or amended and agrees to perform the same upon the terms and conditions herein and in the Indenture, as heretofore supplemented, set forth and upon the following terms and conditions:
The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Fourth Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made by the Company solely. In general, each and every term and condition contained in Article VI of the Indenture shall apply to and form part of this Fourth Supplemental Indenture with the same force and effect as if the same were herein set forth in full with such omissions, 

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variations, and insertions, if any, as may be appropriate to make the same conform to the provisions of this Fourth Supplemental Indenture.
Section 6.04    This Fourth Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

Section 6.05    This Fourth Supplemental Indenture shall be governed by and construed in accordance with the law of the State of New York (including without limitation Section 5-1401 of the New York General Obligations Law or any successor to such statute).

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IN WITNESS WHEREOF, the parties hereto have caused this Fourth Supplemental Indenture to be duly executed as of the day and year first above written.

PUBLIC SERVICE COMPANY OF NEW MEXICO

By: _____/s/ Terry R. Horn__________
Terry R. Horn
Vice President and Treasurer       
Attest:

____/s/ Jim S. Acosta________
Assistant Secretary

UNION BANK, N.A., as Trustee

By:     /s/ Jennifer Earle              
Jennifer Earle
Vice President

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