Document:

EX-10.7

Exhibit 10.7

Subscription Agreement

As of
                                        
, 2008

To the Board of Directors of

Gabelli Entertainment & Telecommunications Acquisition Corp.:

Gentlemen:

     The undersigned hereby subscribes for and agrees to purchase
                     Warrants (“Private
Placement Warrants”) at $1.00 per Insider Warrant, each to purchase one share of common stock, par
value $0.0001 per share, of Gabelli Entertainment & Telecommunications Acquisition Corp. (the
“Corporation”) for an aggregate purchase price of $                     (“Purchase Price”). The purchase and
issuance of the Private Placement Warrants shall occur simultaneously with the consummation of the
Corporation’s initial public offering of securities (“IPO”) which is being underwritten by the
underwriters set forth in the Company’s IPO prospectus included in the Registration Statement, for
which Citigroup
Global Markets Inc. (“Citigroup”) is acting as representative. The Private
Placement Warrants will be sold to the undersigned on a private placement basis and not part of the
IPO. Except as set forth herein, the Private Placement Warrants shall be identical to the warrants
issued in the IPO.

     At least 24 hours prior to the effective date of the registration statement filed in
connection with the IPO (“Registration Statement”), the undersigned shall deliver the Purchase
Price to Graubard Miller (“GM”) to hold in a non-interest bearing account until the Corporation
consummates the IPO. Simultaneously with the consummation of the IPO, GM shall deposit the
Purchase Price, without interest or deduction, into the trust fund (“Trust Fund”) established by
the Corporation for the benefit of the Corporation’s public stockholders as described in the
Corporation’s Registration Statement, pursuant to the terms of an Investment Management Trust
Agreement to be entered into between the Corporation and American Stock Transfer & Trust
Company. In the event that the IPO is not consummated within 14 days of the date the Purchase
Price is delivered to GM, GM shall return the Purchase Price to the undersigned, without interest
or deduction.

     The undersigned represents and warrants that he has been advised that the Private Placement
Warrants (including the underlying shares of common stock) have not been registered under the
Securities Act; that he is acquiring the Private Placement Warrants for his account for investment
purposes only; that he has no present intention of selling or otherwise disposing of the Private
Placement Warrants in violation of the securities laws of the United States; that he is an
“accredited investor” as defined by Rule 501 of Regulation D promulgated under the Securities Act
of 1933, as amended (the “Securities Act”); and that he is familiar with the proposed business,
management, financial condition and affairs of the Corporation.

     Moreover, the undersigned agrees that he shall not sell or transfer the Private Placement
Warrants or any underlying securities (except (i) to another officer or director of the Company,
(ii) to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent
and distribution upon death, (iv) pursuant to a qualified domestic relations order or (v) to an
entity’s members upon its liquidation to the extent the Private Placement Warrants are subsequently
transferred to an entity, in each case, subject to the transferee agreeing to such transfer
restrictions) until after the Corporation consummates a merger, capital stock exchange, asset
acquisition or other similar business combination with an operating business (“Business
Combination”) meeting the requirements set forth in the Registration Statement and acknowledges
that the certificates for such Private Placement Warrants shall contain a legend indicating such
restriction on transferability.

 

 

     The Company hereby acknowledges and agrees that the Private Placement Warrants will be
exercisable on a cashless basis and, in the event the Company calls the Warrants for redemption
pursuant to that certain Warrant Agreement to be entered into by the
Company and American Stock
Transfer & Trust Company in connection with the Company’s IPO, shall not be redeemable by the
Company so long as such Private Placement Warrants are held by the undersigned or his permitted
transferees.

     The terms of this agreement and the restriction on transfers with respect to the Private
Placement Warrants may not be amended without the prior written consent of Citigroup.

	 	 	 	 	 
	 	Very truly yours,

Gabelli Acquisition, LLC
 	 

	 	 	 	 	 
	
Agreed to:

Gabelli Entertainment & Telecommunications Acquisition Corp.

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 
	Graubard Miller

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:EX-4.5

Exhibit 4.5

EXECUTION COPY

PNM RESOURCES, INC.

to

U.S. BANK NATIONAL ASSOCIATION,

Trustee

 

SUPPLEMENTAL INDENTURE NO. 2

Dated as of August 4, 2008

 

(For Senior Notes)

 

 

TABLE OF CONTENTS

Article 1

DEFINITIONS

	 	 	 	 	 
	Section 1.01 Relation to Base Indenture
	 	 	1	 
	Section 1.02 Definition of Terms
	 	 	1	 

Article 2

CHANGES TO THE GENERAL TERMS AND CONDITIONS

OF THE ORIGINAL SENIOR NOTES

	 	 	 	 	 
	Section 2.01 Amendment of Section 1.02 of Supplemental Indenture No. 1
	 	 	3	 
	Section 2.02 Amendment of Section 2.04 of Supplemental Indenture No. 1
	 	 	3	 
	Section 2.03 Amendment of Section 2.05 of Supplemental Indenture No. 1
	 	 	3	 
	Section 2.04 Amendment of Article 8 of Supplemental Indenture No. 1
	 	 	4	 
	Section 2.05 Amendment of Exhibit A of Supplemental Indenture No. 1
	 	 	7	 

Article 3

MISCELLANEOUS

	 	 	 	 	 
	Section 3.01 Ratification of Indenture
	 	 	7	 
	Section 3.02 Trustee not Responsible for Recitals
	 	 	7	 
	Section 3.03 New York Law to Govern
	 	 	7	 
	Section 3.04 Separability
	 	 	7	 
	Section 3.05 Counterparts
	 	 	8	 

i

 

     SUPPLEMENTAL INDENTURE NO. 2, dated as of August 4, 2008 (“Supplemental Indenture No. 2”),
between PNM RESOURCES, INC., a corporation duly organized and existing under the laws of the State
of New Mexico (the “Company”), having its principal office at Alvarado Square, Albuquerque, New
Mexico 87158, and U.S. BANK NATIONAL ASSOCIATION, a national banking association, as Trustee (the
“Trustee”).

RECITALS OF THE COMPANY

     WHEREAS, the Company has heretofore executed and delivered to the Trustee an Indenture dated
as of October 7, 2005 (the “Base Indenture”), providing for the issuance from time to time of
series of the Notes (as defined in the Base Indenture).

     WHEREAS, pursuant to Section 9.01(7) of the Base Indenture, the Company has heretofore
executed and delivered to the Trustee a Supplemental Indenture dated as of October 7, 2005 (the
“Supplemental Indenture No. 1” and, together with the Base Indenture, the “Indenture”) to establish
the form and terms of the Company’s 5.1% Senior Notes due August 16, 2010 (the “Original Senior
Notes”) as permitted by Section 3.01 of the Base Indenture.

     WHEREAS, on October 7, 2005, pursuant to Section 2.01 and Section 3.01 of the Base Indenture,
the Company issued $100,000,000 aggregate principal amount of the Original Senior Notes, all of
which remain Outstanding on the date hereof.

     WHEREAS, Section 9.02 of the Base Indenture provides that, with the consent of the Holders of
the Notes of all series then Outstanding under the Indenture, considered as one class, by Act of
said Holders delivered to the Company and the Trustee, the Company, when authorized by or pursuant
to a Board Resolution, and the Trustee may enter into an indenture or indentures supplemental to
the Base Indenture for the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, the Indenture.

     WHEREAS, the Company now desires to amend the Indenture in order to change the terms of the
Original Senior Notes (such Original Senior Notes as so modified the “Amended Senior Notes”).

     WHEREAS, Holders of all Notes Outstanding (as such terms are defined in the Base Indenture)
have heretofore consented to the changes to the Indenture and the Original Senior Notes embodied in
and to be effected by this Supplemental Indenture No. 2 pursuant to Section 9.02 of the Base
Indenture.

     WHEREAS, the Company has requested that the Trustee execute and deliver this Supplemental
Indenture No. 2, and all requirements necessary to make this Supplemental Indenture No. 2 a valid,
binding and enforceable instrument in accordance with its terms, and to make the Amended Senior
Notes, when executed by the Company and authenticated and delivered by the Trustee, the valid,
binding and enforceable obligations of the Company, have been done and performed, and the execution
and delivery of this Supplemental Indenture No. 2 has been duly authorized in all respects.

     NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

Article 1

DEFINITIONS

          Section 1.01 Relation to Base Indenture. This Supplemental Indenture No. 2 constitutes
an integral part of the Base Indenture.

          Section 1.02 Definition of Terms. For all purposes of this Supplemental Indenture No.
2:

          (a) Capitalized terms used herein without definition shall have the meanings specified in the
Base Indenture or Supplemental Indenture No. 1, or, if not defined in the Base Indenture or
Supplemental Indenture No. 1, in the Purchase Contract Agreement, the Pledge Agreement or the
Remarketing Agreement, as applicable;

1

 

          (b) a term defined anywhere in this Supplemental Indenture No. 2 has the same meaning
throughout;

          (c) the singular includes the plural and vice versa;

          (d) headings are for convenience of reference only and do not affect interpretation;

          (e) the following terms have the meanings given to them in this Article 1 and such meanings
shall supersede and replace the meanings given them, if any, in the Base Indenture or Supplemental
Indenture No. 1:

          “Base Rate” means, if the Company has elected for the Reset Rate to be a floating interest
rate, the applicable index rate or the method or formula for calculating an index rate chosen by
the Company in connection with such election as stated in the notice provided for in Section
8.03(g).

          “Pledge Agreement” means the Amended and Restated Pledge Agreement, dated as of August 4,
2008, among the Company, U.S. Bank National Association, as Collateral Agent, Custodial Agent and
Securities Intermediary, and U.S. Bank National Association, as Purchase Contract Agent and
attorney-in-fact for the Holders of the Purchase Contracts, as amended from time to time.

          “Purchase Contract Agreement” means the Amended and Restated Purchase Contract Agreement,
dated as of August 4, 2008, between the Company and U.S. Bank National Association, as purchase
contract agent, as amended from time to time.

          “Remarketing Agreement” means the Remarketing Agreement, dated as of October 7, 2005, as
amended and supplemented by a letter agreement, dated as of August 4, 2008, among the Company, the
Remarketing Agent, and the Purchase Contract Agent, as amended from time to time.

          “Remarketing Price” shall have the meaning set forth in Section 8.02.

          “Resale Restriction Termination Date” means, for any Restricted Senior Note (or beneficial
interest therein), one year (or such other period specified in Rule 144 (or any successor
provision)) from the Issuance Date.

          “Reset Effective Date” means the Purchase Contract Settlement Date, in the event of a
Successful Remarketing pursuant to which the Coupon Rate is reset to a Reset Rate.

          “Reset Rate” means, at the option of the Company, either (i) the fixed interest rate per annum
(as determined by the Remarketing Agent) or, (ii) if the Company has elected for the Reset Rate to
be a floating interest rate, the sum of the Reset Spread (as determined by the Remarketing Agent)
and the Base Rate, as necessary to remarket the Remarketed Senior Notes at the Remarketing Price;
provided that if there are no Corporate Units outstanding and none of the Holders elect to have
Separate Senior Notes held by them remarketed, or in the case of a Failed Final Remarketing, the
interest rate payable on the Senior Notes will not be reset and the interest rate payable on the
Senior Notes shall continue to be the Coupon Rate.

          “Reset Spread” means the number of basis points necessary to be added to the Base Rate on the
applicable Remarketing Date in order to remarket all of the Remarketed Senior Notes at the
Remarketing Price on such Remarketing Date, as determined in accordance with Section 8.03.

          “Treasury Portfolio” means a portfolio of (1) U.S. treasury securities (or principal or
interest strips thereof) that mature on or prior to November 15, 2008 in an aggregate amount at
maturity equal to the Applicable Principal Amount, and, (2) in the case of a Special Event
Redemption, for each scheduled Interest Payment Date that occurs after the Special Event Redemption
Date to and including the Purchase Contract Settlement Date, U.S. treasury securities (or principal
or interest strips thereof) that mature on or prior to the business day immediately preceding such
scheduled Interest Payment Date in an aggregate amount equal to the aggregate interest payment
(assuming no reset of the interest rate) that would have been due on such scheduled Interest
Payment Date on the Applicable Principal Amount.

          “Treasury Portfolio Purchase Price” means the lowest aggregate ask-side price quoted by a
Primary Treasury Dealer to the Quotation Agent between 9:00 a.m. and 11:00 a.m., New York City
time, on the third Business Day immediately preceding the Special Event Redemption Date for the
purchase of the applicable Treasury Portfolio for settlement on the Special Event Redemption Date.

2

 

          The terms “Supplemental Indenture No. 2,” “Company,” “Trustee,” “Indenture,” “Base Indenture”
“Supplemental Indenture No. 1,” “Original Senior Notes” and “Amended Senior Notes” shall have the
respective meanings set forth in the recitals to this Supplemental Indenture No. 2 and the
paragraph preceding such recitals.

ARTICLE 2

CHANGES TO THE GENERAL TERMS AND CONDITIONS

OF THE ORIGINAL SENIOR NOTES

          Section 2.01 Amendment of Section 1.02 of Supplemental Indenture No. 1. Supplemental
Indenture No. 1 is hereby amended by deleting the definition of “Definitive Senior Notes” from
Section 1.02 thereof.

          Section 2.02 Amendment of Section 2.04 of Supplemental Indenture No. 1. Supplemental
Indenture No. 1 is hereby amended by deleting Section 2.04 thereof in its entirety and replacing it
with the following:

     Section 2.04. Global or Definitive Senior Notes. Senior
Notes that are no longer a component of the Corporate Units and are
released from the Collateral Account (as defined in the Pledge
Agreement) may, at the Company’s option, either be issued (i) in
fully registered, global form, and initially evidenced by one or
more certificates issued to Cede & Co., as nominee of The Depository
Trust Company, or (ii) in certificated form.

          Section 2.03. Amendment of Section 2.05 of Supplemental Indenture No. 1. Supplemental
Indenture No. 1 is hereby amended by deleting Section 2.05 thereof in its entirety and replacing it
with the following:

     Section 2.05. Interest. (a) The Senior Notes will bear
interest initially at the rate of 5.1% per year (the “Coupon Rate”)
from the original date of issuance through and including the earlier
of (i) the Maturity Date and (ii) the day immediately preceding any
Reset Effective Date. In the event of a Successful Remarketing of
the Senior Notes, the Coupon Rate will be reset by the Remarketing
Agent at the appropriate Reset Rate with effect from the related
Reset Effective Date, as set forth under Section 8.03. If the Coupon
Rate is so reset, the Senior Notes will bear interest at the Reset
Rate from time to time in effect from the related Reset Effective
Date until the principal thereof and interest thereon is paid or
duly made available for payment and shall bear interest, to the
extent permitted by law, compounded on each Interest Payment Date,
on any overdue principal and payment of interest at the Coupon Rate
through and including the day immediately preceding the Reset
Effective Date and at the Reset Rate from time to time in effect
thereafter.

     (b) Interest on the Senior Notes shall be payable quarterly in
arrears on February 16, May 16, August 16 and November 16 of each
year (each, an “Interest Payment Date”), commencing November 16,
2005, to the Person in whose name such Senior Note, or any
predecessor Senior Note, is registered at the close of business on
the Record Date for such Interest Payment Date. Interest on the
Senior Notes shall accrue from October 7, 2005.

     Notwithstanding the foregoing, in the event of a Successful
Remarketing of the Senior Notes, the Company may redetermine the
Interest Payment Dates and the Senior Notes will bear interest at
the appropriate Reset Rate from time to time in effect from the
related Reset Effective Date payable either semi-annually or
quarterly, as determined by the Company.

     (c) If the Reset Rate is a fixed interest rate, the amount of
interest payable for any full quarterly or semi-annual period, as
the case may be, will be

3

 

computed on the basis of a 360-day year
consisting of twelve 30-day months. The amount of interest payable
for any period shorter than a full quarterly or semi-annual period,
as the case may be, for which interest is computed will be computed
on the basis of a 30-day month and, for any period less than a
month, on the basis of the actual number of days elapsed per 30-day
month. In the event that any scheduled Interest Payment Date falls
on a day that is not a Business Day, then payment of interest
payable on such Interest Payment 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).

     (d) Notwithstanding any other provision of the Indenture, in
the event the Reset Rate is a floating interest rate, the Company
may elect (i) to modify the day count conventions set forth in this
Section 2.05 and (ii) to modify the definition of the term “Business
Day” set forth in Section 1.02 herein.

          Section 2.04 Amendment of Article 8 of Supplemental Indenture No. 1. Supplemental
Indenture No. 1 is hereby amended by deleting Article 8 thereof in its entirety and replacing it
with the following:

ARTICLE 8

REMARKETING

     Section 8.01. Remarketing Procedures. (a) Unless a
Special Event Redemption, an Early Settlement or a Cash Merger Early
Settlement has occurred prior to the Initial Remarketing Date, the
Company shall engage the Remarketing Agent pursuant to the
Remarketing Agreement for the Remarketing of the Senior Notes. The
Company will request, not later than seven nor more than 15 calendar
days prior to the Initial Remarketing Date, that the Trustee notify
the Holders of Separate Senior Notes, Corporate Units and Treasury
Units of the procedures to be followed in the Remarketings.

     (b) Each Holder of Separate Senior Notes may elect to have
Separate Senior Notes held by such Holder remarketed in all
Remarketings. A Holder making such an election must, pursuant to the
Pledge Agreement, notify the Custodial Agent and deliver such
Separate Senior Notes to the Custodial Agent on or prior to 5:00
p.m. (New York City time) on or prior to the seventh Business Day
immediately preceding the Initial Remarketing Date (but no earlier
than the Interest Payment Date immediately preceding the Initial
Remarketing Date). Any such notice and delivery may not be
conditioned upon the level at which the Reset Rate is established in
the Remarketing. Any such notice and delivery may be withdrawn on or
prior to 5:00 p.m. (New York City time) on the seventh Business Day
immediately preceding the Initial Remarketing Date in accordance
with the provisions set forth in the Pledge Agreement. Any such
notice and delivery not withdrawn by such time will be irrevocable
with respect to all Remarketings. Pursuant to Section 5.07(c) of the
Pledge Agreement, by 12:00 noon, New York City time, on the Business
Day immediately preceding the Initial Remarketing Date, the
Custodial Agent, based on the notices and deliveries received by it
prior to such time, shall notify the Remarketing Agent of the
principal amount of Separate Senior Notes to be tendered for
Remarketing and, upon a Successful Remarketing, shall cause such
Separate Senior Notes to be presented to the Remarketing Agent.
Under Section 5.02 of the Purchase Contract Agreement, Senior Notes
that are components of
Corporate Units will be deemed tendered for Remarketing and
will be remarketed in accordance with the terms of the Remarketing
Agreement.

4

 

     (c) The right of each Holder of Senior Notes that are included
in Corporate Units to have such Senior Notes, and each Holder of
Separate Senior Notes to have any Separate Senior Notes (together,
the “Remarketed Senior Notes”), remarketed and sold on any
Remarketing Date shall be limited to the extent that (i) the
Remarketing Agent conducts a Remarketing pursuant to the terms of
the Remarketing Agreement, (ii) a Special Event Redemption has not
occurred prior to such Remarketing Date, (iii) the Remarketing Agent
is able to find a purchaser or purchasers for Remarketed Senior
Notes at the Remarketing Price and (iv) the purchaser or purchasers
deliver the purchase price therefor to the Remarketing Agent as and
when required.

     (d) Neither the Trustee, the Company nor the Remarketing Agent
shall be obligated in any case to provide funds to make payment upon
tender of Senior Notes for remarketing.

     Section 8.02. Remarketing. Unless a Special Event
Redemption, an Early Settlement or a Cash Merger Early Settlement
has occurred prior to the Initial Remarketing Date, on the Initial
Remarketing Date, the Remarketing Agent shall, pursuant and subject
to the terms of the Remarketing Agreement, use commercially
reasonable efforts to remarket the Remarketed Senior Notes at a
price (the “Remarketing Price”) equal to 100.00% of the aggregate
principal amount of the Remarketed Senior Notes.

     Section 8.03. Reset Rate and Extended Maturity Date.
(a) In connection with each Remarketing, and subject to Sections
8.03(b) and 8.03(c) below, the Remarketing Agent shall determine, in
consultation with the Company, the Reset Rate (with the fixed
interest rate or, in the case of a floating interest rate, the Reset
Spread rounded to the nearest one-thousandth (0.001) of one percent
per annum) that the Remarketed Senior Notes should bear in order to
have an aggregate market value equal to the Remarketing Price and
that in the sole discretion of the Remarketing Agent will enable it
to remarket all of the Remarketed Senior Notes at the Remarketing
Price in such Remarketing.

     (b) Anything herein to the contrary notwithstanding, the
Remarketing Agent shall have no obligation to determine whether
there is any limitation under applicable law on the Reset Rate or,
if there is any such limitation, the maximum permissible Reset Rate
on the Senior Notes and shall rely solely upon written notice from
the Company (which the Company agrees to provide prior to the eighth
Business Day before the Initial Remarketing Date) as to whether or
not there is any such limitation in any applicable jurisdiction.

     (c) In connection with each Remarketing, the Remarketing Agent,
in consultation with the Company, may extend the Maturity Date to a
date selected by the Company that is two or three years from the
date on which the Reset Rate is set. Such extended maturity date
(the “Extended Maturity Date”), if any, will be specified in the
Remarketing announcement and will become effective on the Reset
Effective Date.

     (d) In connection with each Remarketing, the Company may also
elect to add any additional financial covenants as the Company may
determine. Such an election would take effect, upon a Successful
Remarketing, on the Reset Effective Date. In addition, as provided
in Section 2.05(b) herein, upon a Successful Remarketing, the
Interest Payment Dates may be redetermined to
provide for payment of interest semi-annually instead of
quarterly. Furthermore, as provided in Section 2.05(d) herein, upon
a Successful Remarketing at a floating interest rate Reset Rate, the
business day and day count conventions set

5

 

forth in Section 2.05
herein and the definition of “Business Day” set forth in Section
1.02 herein may be modified.

     (e) In the event of a Failed Final Remarketing or if no Senior
Notes are included in Corporate Units and none of the Holders of the
Separate Senior Notes elect to have their Senior Notes remarketed in
any Remarketing, the applicable interest rate on the Senior Notes
will not be reset and will continue to be the Coupon Rate and the
Maturity Date will not be extended.

     (f) In the event of a Successful Remarketing, as of the Reset
Effective Date, the Coupon Rate shall be reset at the Reset Rate as
determined by the Remarketing Agent under the Remarketing Agreement
and the Maturity Date, if extended, will be extended to the Extended
Maturity Date.

     (g) The Company, at its option, may elect for the Reset Rate to
be either a fixed interest rate (as determined by the Remarketing
Agent) or a floating interest rate equal to the sum of the Reset
Spread (as determined by the Remarketing Agent) and the Base Rate
(as determined by the Company). The Amended Senior Notes may have
such terms in addition to or in lieu of any one or more of the terms
established pursuant to any of the provisions of this Supplemental
Indenture No. 2 and may be in such form, in any case, as the Company
may determine and as shall be set forth in an indenture supplemental
to the Indenture, as supplemented and amended hereby; and the
Trustee is hereby authorized and directed to join with the Company
in the execution and delivery of any such supplemental indenture,
such supplemental indenture, if any, to be effective as the Reset
Effective Date.

     Section 8.04. Failed Remarketing. (a) If, by 4:00 p.m.
(New York City time) on any Remarketing Date, the Remarketing Agent
is unable to remarket all of the Remarketed Senior Notes at the
Remarketing Price, pursuant to the terms and conditions hereof, a
Failed Remarketing shall be deemed to have occurred, and the
Remarketing Agent shall so advise by telephone the Purchase Contract
Agent and the Company. Whether or not there has been a Failed
Remarketing will be determined in the sole reasonable discretion of
the Remarketing Agent. Promptly following any Failed Final
Remarketing, the Custodial Agent shall return the Separate Senior
Notes to the appropriate Holders.

     (b) The Company shall cause a notice of a Failed Final
Remarketing to be posted on the Company’s website by the first
Business Day following such Failed Final Remarketing.

     Section 8.05. Put Right. (a) Subject to paragraph (b)
hereof, if there has not been a Successful Remarketing prior to the
Purchase Contract Settlement Date, Holders of Separate Senior Notes
and Holders of Senior Notes that are a component of Corporate Units
will, subject to this Section 8.05, have the right (the “Put Right”)
to require the Company to purchase their Senior Notes, on the
Purchase Contract Settlement Date, at a price per Senior Note equal
to $1,000.00 plus accrued and unpaid interest to but excluding the
Purchase Contract Settlement Date (the “Put Price”).

     (b) The Put Right of Holders of Senior Notes that are part of
Corporate Units will be automatically exercised unless such Holders
(1) prior to
5:00 p.m., New York City time, on the second Business Day
immediately preceding the Purchase Contract Settlement Date, provide
written notice to the Purchase Contract Agent of their intention to
settle the related Purchase Contract

6

 

with separate cash, and (2) on
or prior to 5:00 p.m., New York City time, on the Business Day
immediately preceding the Purchase Contract Settlement Date, deliver
to the Collateral Agent $25 in cash per Purchase Contract, in each
case pursuant to the Purchase Contract Agreement and such Holders
shall be deemed to have elected to pay the Purchase Price for the shares of Common Stock or Preferred Stock, as applicable, to be
issued under the related Purchase Contract from a portion of the
Proceeds of the Put Right of such Senior Notes equal to the Purchase
Price in full satisfaction of such Holders’ obligations under the
Purchase Contracts, and any remaining amount of the Put Price
following satisfaction of the related Purchase Contract will be paid
to such Holder.

     (c) The Put Right of a Holder of a Separate Senior Note shall
only be exercisable upon delivery of a notice to the Trustee by such
Holder on or prior to 5:00 p.m., New York City time, on the second
Business Day immediately preceding the Purchase Contract Settlement
Date. On or prior to the Purchase Contract Settlement Date, the
Company shall deposit with the Trustee immediately available funds
in an amount sufficient to pay, on the Purchase Contract Settlement
Date, the aggregate Put Price of all Separate Senior Notes with
respect to which a Holder has exercised a Put Right. In exchange for
any Separate Senior Notes surrendered pursuant to the Put Right, the
Trustee shall then distribute such amount to the Holders of such
Separate Senior Notes.

     Section 8.06. Additional Event of Default. In addition
to the events listed as Events of Default in Section 5.01 of the
Base Indenture, it shall be an additional Event of Default with
respect to the Senior Notes, if the Company shall not have satisfied
its obligation to pay the Put Price when due with respect to any
Separate Senior Note following exercise of the Put Right in
accordance with Section 8.05.

     Section 8.07 Legal Holidays. In case the Purchase
Contract Settlement Date shall not be a Business Day
(notwithstanding any other provision of this Indenture or of the
Senior Notes), any Remarketing of Senior Notes shall not settle on
such date and remarketed Senior Notes shall be settled on the next
succeeding Business Day with the same force and effect as if made on
such Purchase Contract Settlement Date, and without any adjustment
of the Purchase Price.

          Section 2.05 Amendment of Exhibit A of Supplemental Indenture No. 1. Supplemental
Indenture No. 1 is hereby amended by deleting Exhibit A thereto in its entirety and replacing it
with Exhibit A hereto.

ARTICLE 3

MISCELLANEOUS

          Section 3.01 Ratification of Indenture. The Indenture, as supplemented by this
Supplemental Indenture No. 2, is in all respects ratified and confirmed, and this Supplemental
Indenture No. 2 shall be deemed part of the Indenture in the manner and to the extent herein and
therein provided.

          Section 3.02 Trustee not Responsible for Recitals. The recitals herein contained are
made by the Company and not by the Trustee, and the Trustee assumes no responsibility for the
correctness thereof The Trustee makes no representation as to the validity or sufficiency of this
Supplemental Indenture No. 2.

          Section 3.03 New York Law to Govern. THIS SUPPLEMENTAL INDENTURE NO. 2 AND EACH
AMENDED SENIOR NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.

          Section 3.04 Separability. In case any one or more of the provisions contained in this
Supplemental Indenture No. 2 or in the Amended Senior Notes shall for any reason be held to be
invalid, illegal or

7

 

unenforceable in any respect, then, to the extent permitted by law, such
invalidity, illegality or unenforceability shall not affect any other provisions of this
Supplemental Indenture No. 2 or of the Amended Senior Notes, but this Supplemental Indenture No. 2
and the Amended Senior Notes shall be construed as if such invalid or illegal or unenforceable
provision had never been contained herein or therein.

          Section 3.05 Counterparts. This Supplemental Indenture No. 2 may be executed in any
number of counterparts each of which shall be an original, but such counterparts shall together
constitute but one and the same instrument.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;

SIGNATURE PAGE FOLLOWS]

8

 

[SIGNATURE PAGE TO SUPPLEMENTAL INDENTURE NO. 2]

          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No. 2 to be
duly executed, as of the day and year first written above.

	 	 	 	 	 
	 	PNM RESOURCES, INC.

 	 
	 	By:  	/s/ Terry R. Horn 	 
	 	 	Terry R. Horn, 	 
	 	 	Vice President and Treasurer 	 
	 
	 	U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	 	 
	 	 	Patrick J. Crowley 	 
	 	 	Vice President 	 
	 

9

 

[SIGNATURE PAGE TO SUPPLEMENTAL INDENTURE NO. 2]

          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No. 2 to be
duly executed, as of the day and year first written above.

	 	 	 	 	 
	 	PNM RESOURCES, INC.

 	 
	 	By:  	 	 
	 	 	Terry R. Horn, 	 
	 	 	Vice President and Treasurer 	 
	 
	 	U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	/s/ Patrick J. Crowley 	 
	 	 	Patrick J. Crowley 	 
	 	 	Vice President 	 
	 

10

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