Document:

EXHIBIT
10.6

 

SEVERANCE
PAYMENT AGREEMENT

(Amended
and Restated as of November 4, 2008)

 

This
Severance Agreement was entered into as of January 30, 2002 between
Internet Brands, Inc., formerly CarsDirect.com, Inc., (the “Company”)
and Lynn Walsh (the “Employee”) and is hereby amended and restated as of November 4,
2008.

 

WHEREAS,
Employee is a senior executive of the Company in the capacity of Executive Vice
President and General Counsel;

 

WHEREAS,
the Company desires to recognize Employee’s continued contribution to the
growth and stability of the Company and provide an additional incentive for
Employee to remain at the Company;

 

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

 

1.               Severance Payment.    If
the Company terminates Employee’s employment without Cause, as defined in
paragraph 2 below, and for reasons other than death or disability, and such termination
constitutes a “separation from service” within the meaning of Section 409A
of the Internal Revenue Code of 1986, as amended, and the applicable guidance
issued thereunder (“Section 409A”), the Company will make a lump sum
payment to Employee which payment shall be equal to nine months of Employee’s
base salary plus 75% of Employee’s annual stated cash bonus target.  Notwithstanding the foregoing, it shall be a
condition to Employee’s right to receive such payment that Employee executes
and delivers to the Company a full general release of claims within twenty-one
(21) days following the date of such termination and the statutory period for
rescission of such release elapses without revocation of such release.  Such payment shall be made on the date following
the termination date on which statutory period has lapsed, but in all cases, no
later than sixty (60) days following the termination date.  In addition, Employee shall receive nine
months of continued health, dental and life insurance benefits under COBRA on
the same premium copayment terms as Employee had while employed at the Company
provided that Employee was enrolled in such plans on the date of termination,
subject to Employee’s timely election and maintenance of  COBRA coverage. Notwithstanding the foregoing
sentence, if Employee retains alternative employment during the nine month
severance period and the new employer offers such benefits, Employee’s health,
dental and/or life insurance benefits shall terminate on the date that such
benefits commence at the new employer.

 

2.     Acceleration of Vesting of Equity Grants
Upon a Change of Control.  On the
occurrence of a Change of Control (defined below) (i) each of Employee’s
equity grants that are not otherwise fully vested shall automatically vest on a
daily prorata basis over the period starting from the most recent vesting date
of each such grant prior to the Change of Control

 

1

 

through immediately prior to the closing date of the Change of Control;
(ii) the remaining unvested  portion
of each of Employee’s equity grants shall automatically vest 50% immediately
prior to the closing date of the Change of Control. Immediately prior to the
closing of the Change of Control transaction, the Company or the successor
entity will reserve amounts sufficient to pay Employee for the remaining 50% of
unvested equity grants (in cash and/or publicly traded stock of the successor
entity on the same terms as provided to Company stockholders on the closing
date). Such remaining 50% shall continue to vest under the terms of such equity
grant agreements through the earlier of the first anniversary of the closing
date of the Change of Control transaction or a termination of Employee under
this subsection (c), upon which date all remaining unvested equity grants shall
automatically vest and Employee shall be paid all amounts reserved for such
purpose to Employee. “Change of Control” shall mean (i) the consummation
of a merger or consolidation of the Company with any other corporation, other
than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities
of the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (ii) the
consummation of the sale or disposition by the Company of all or substantially
all the Company’s assets,

 

3.               Cause.            For purposes of paragraph 1 above, “Cause”
shall be defined as (i) termination for any act of personal dishonesty
taken by Employee in connection with Employee’s responsibilities to the Company
after repeated written warnings, (ii) a felony conviction, (iii) termination
due to a willful act that constitutes misconduct and is injurious to the
Company after repeated written warnings, or (iv) gross negligence,
recklessness, or willful misconduct or malfeasance in the performance by
Employee of her duties after repeated written warnings.

 

4.               Taxes.              All payments made pursuant to this Agreement
shall be subject to withholding of applicable income and employment taxes.

 

5.               Section 409A.  To
the extent applicable, this Agreement shall be interpreted in a manner that
satisfies, or qualifies for exemption from, the requirements of Section 409A.  Notwithstanding any provision of this
Agreement to the contrary, if the Company determines that any payments or
benefits payable under this Agreement may be subject to Section 409A, the
Company may, with Employee’s prior written consent, adopt such amendments to
this Agreement or adopt other policies or procedures (including amendments,
policies and procedures with retroactive effect), or take any other actions,
that the Company determines are necessary or appropriate to comply with, or
exempt such payments and benefits from, the requirements of Section 409A.

 

2

 

IN
WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Company by its duly authorized officer, as of November 4, 2008.

 

	
  INTERNET BRANDS, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Robert N. Brisco

  	
   

  	
   

  
	
   

  	
  Robert
  N. Brisco

  	
   

  	
   

  
	
   

  	
  Chief
  Executive Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EMPLOYEE:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Lynn Walsh

  	
   

  	
   

  
	
   

  	
  Lynn
  Walsh

  	
   

  	
   

  

 

3exh4-1_093008.htm

    

     

    EXHIBIT
4.1

     

    EXECUTION
COPY

     

     PNM
RESOURCES, INC.

     

     

    and

     

     

    U.S.
BANK NATIONAL ASSOCIATION,

    as
Purchase Contract Agent

     

     

     

    AMENDED
AND RESTATED

    PURCHASE
CONTRACT AGREEMENT

    

    

    

    

    Dated
as of August 4, 2008

    

    

    

    

    

     

    

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    Table
of Contents

     

     

    ARTICLE 1

    DEFINITIONS
AND OTHER PROVISIONS OF GENERAL APPLICATION

     

    
      	 
      	 
      	
              Page

            
	
              Section
      1.01.

            	
              Definitions                                                                                          

            	
              1

            
	
              Section
      1.02.

            	
              Compliance
      Certificates and
      Opinions                                                                                          

            	
              11

            
	
              Section
      1.03.

            	
              Form
      of Documents Delivered to Purchase Contract Agent

            	
              11

            
	
              Section
      1.04.

            	
              Acts
      of Holders; Record
      Dates                                                                                          

            	
              12

            
	
              Section
      1.05.

            	
              Notices                                                                                          

            	
              12

            
	
              Section
      1.06.

            	
              Notice
      to Holders;
      Waiver                                                                                          

            	
              13

            
	
              Section
      1.07.

            	
              Effect
      of Headings and Table of
      Contents                                                                                          

            	
              14

            
	
              Section
      1.08.

            	
              Successors
      and
      Assigns                                                                                          

            	
              14

            
	
              Section
      1.09.

            	
              Separability
      Clause                                                                                          

            	
              14

            
	
              Section
      1.10.

            	
              Benefits
      of
      Agreement                                                                                          

            	
              14

            
	
              Section
      1.11.

            	
              Governing
      Law                                                                                          

            	
              14

            
	
              Section
      1.12.

            	
              Legal
      Holidays                                                                                          

            	
              14

            
	
              Section
      1.13.

            	
              Counterparts                                                                                          

            	
              14

            
	
              Section
      1.14.

            	
              Inspection
      of
      Agreement                                                                                          

            	
              14

            
	
              Section
      1.15.

            	
              Appointment
      of Financial Institution as Agent for the Company

            	
              14

            
	
              Section
      1.16.

            	
              No
      Waiver                                                                                          

            	
              15

            

    

     

    ARTICLE
2

    CERTIFICATE
FORMS

     

    
      	
              Section
      2.01.

            	
              Forms
      of Certificates
      Generally                                                                                          

            	
              15

            
	
              Section
      2.02.

            	
              Form
      of Purchase Contract Agent’s Certificate of Authentication

            	
              15

            

    

     

    ARTICLE
3

    THE
UNITS

     

    
      	
              Section
      3.01.

            	
              Amount;
      Form and
      Denominations                                                                                          

            	
              15

            
	
              Section
      3.02.

            	
              Rights
      and Obligations Evidenced by the
      Certificates                                                                                          

            	
              15

            
	
              Section
      3.03.

            	
              Execution,
      Authentication, Delivery and
      Dating                                                                                          

            	
              16

            
	
              Section
      3.04.

            	
              Temporary
      Certificates                                                                                          

            	
              16

            
	
              Section
      3.05.

            	
              Registration;
      Registration of Transfer and
      Exchange                                                                                          

            	
              17

            
	
              Section
      3.06.

            	
              Form
      of Private Placement
      Legends                                                                                          

            	
              18

            
	
              Section
      3.07.

            	
              Notices
      to
      Holders                                                                                          

            	
              19

            
	
              Section
      3.08.

            	
              Intentionally
      Omitted                                                                                          

            	
              19

            
	
              Section
      3.09.

            	
              Definitive
      Certificates                                                                                          

            	
              19

            
	
              Section
      3.10.

            	
              Mutilated,
      Destroyed, Lost and Stolen
      Certificates                                                                                          

            	
              19

            
	
              Section
      3.11.

            	
              Persons
      Deemed
      Owners                                                                                          

            	
              20

            
	
              Section
      3.12.

            	
              Cancellation                                                                                          

            	
              20

            
	
              Section
      3.13.

            	
              Creation
      of Treasury Units by Substitution of Treasury Securities

            	
              21

            
	
              Section
      3.14.

            	
              Recreation
      of Corporate
      Units                                                                                          

            	
              22

            
	
              Section
      3.15.

            	
              Transfer
      of Collateral upon Occurrence of Termination Event

            	
              23

            
	
              Section
      3.16.

            	
              No
      Consent to
      Assumption                                                                                          

            	
              24

            

    

     

    ARTICLE
4

    THE
SENIOR NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE

     

     

    TREASURY
PORTFOLIO

     

    
      	
              Section
      4.01.

            	
              Interest
      Payments; Rights to Interest Payments Preserved

            	
              24

            

    

     

    
      
        
        

      

      
        i

        
          

        

      

       

    

    
      	
              Section
      4.02.

            	
              Notice
      and
      Voting                                                                                          

            	
              24

            
	
              Section
      4.03.

            	
              Special
      Event
      Redemption                                                                                          

            	
              25

            

    

     

    ARTICLE
5

    THE
PURCHASE CONTRACTS

     

    
      	
              Section
      5.01.

            	
              Purchase
      of Shares of Common
      Stock                                                                                          

            	
              26

            
	
              Section
      5.02.

            	
              Remarketing;
      Payment of Purchase
      Price                                                                                          

            	
              28

            
	
              Section
      5.03.

            	
              Issuance
      of Shares of Common
      Stock                                                                                          

            	
              31

            
	
              Section
      5.04.

            	
              Adjustment
      of each Fixed Settlement
      Rate                                                                                          

            	
              32

            
	
              Section
      5.05.

            	
              Notice
      of Adjustments and Certain Other
      Events                                                                                          

            	
              40

            
	
              Section
      5.06.

            	
              Termination
      Event;
      Notice                                                                                          

            	
              41

            
	
              Section
      5.07.

            	
              Early
      Settlement                                                                                          

            	
              41

            
	
              Section
      5.08.

            	
              Election
      to Receive Preferred Stock in Lieu of Common Stock

            	
              43

            
	
              Section
      5.09.

            	
              No
      Fractional
      Shares                                                                                          

            	
              43

            
	
              Section
      5.10.

            	
              Charges
      and
      Taxes                                                                                          

            	
              43

            
	
              Section
      5.11.

            	
              Contract
      Adjustment
      Payments                                                                                          

            	
              44

            

    

     

    ARTICLE
6

    REMEDIES

     

    
      	
              Section
      6.01.

            	
              Unconditional
      Right of Holders to Receive Contract Adjustment Payments and to Purchase
      Shares of Common Stock or Preferred Stock

            	
              47

            
	
              Section
      6.02.

            	
              Restoration
      of Rights and
      Remedies                                                                                          

            	
              48

            
	
              Section
      6.03.

            	
              Rights
      and Remedies
      Cumulative                                                                                          

            	
              48

            
	
              Section
      6.04.

            	
              Delay
      or Omission Not
      Waiver                                                                                          

            	
              48

            
	
              Section
      6.05.

            	
              Undertaking
      for
      Costs                                                                                          

            	
              48

            
	
              Section
      6.06.

            	
              Waiver
      of Stay or Extension
      Laws                                                                                          

            	
              48

            

    

     

    ARTICLE
7

    THE
PURCHASE CONTRACT AGENT

     

    
      	
              Section
      7.01.

            	
              Certain
      Duties and
      Responsibilities                                                                                          

            	
              48

            
	
              Section
      7.02.

            	
              Notice
      of
      Default                                                                                          

            	
              49

            
	
              Section
      7.03.

            	
              Certain
      Rights of Purchase Contract
      Agent                                                                                          

            	
              49

            
	
              Section
      7.04.

            	
              Not
      Responsible for Recitals or Issuance of
      Units                                                                                          

            	
              50

            
	
              Section
      7.05.

            	
              May
      Hold
      Units                                                                                          

            	
              51

            
	
              Section
      7.06.

            	
              Money
      Held in
      Custody                                                                                          

            	
              51

            
	
              Section
      7.07.

            	
              Compensation
      and
      Reimbursement                                                                                          

            	
              51

            
	
              Section
      7.08.

            	
              Corporate
      Purchase Contract Agent Required, Eligibility

            	
              51

            
	
              Section
      7.09.

            	
              Resignation
      and Removal; Appointment of
      Successor                                                                                          

            	
              52

            
	
              Section
      7.10.

            	
              Acceptance
      of Appointment by
      Successor                                                                                          

            	
              53

            
	
              Section
      7.11.

            	
              Merger,
      Conversion, Consolidation or Succession to Business

            	
              53

            
	
              Section
      7.12.

            	
              Preservation
      of Information; Communications to Holders

            	
              53

            
	
              Section
      7.13.

            	
              No
      Obligations of Purchase Contract
      Agent                                                                                          

            	
              53

            
	
              Section
      7.14.

            	
              Tax
      Compliance                                                                                          

            	
              54

            

    

     

    ARTICLE
853

    SUPPLEMENTAL
AGREEMENTS

     

    
      	
              Section
      8.01.

            	
              Supplemental
      Agreements Without Consent of Holders

            	
              54

            
	
              Section
      8.02.

            	
              Supplemental
      Agreements with Consent of
      Holders                                                                                          

            	
              54

            
	
              Section
      8.03.

            	
              Execution
      of Supplemental
      Agreements                                                                                          

            	
              55

            
	
              Section
      8.04.

            	
              Effect
      of Supplemental
      Agreements                                                                                          

            	
              55

            

    

     

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

    
      	
              Section
      8.05.

            	
              Reference
      to Supplemental
      Agreements                                                                                          

            	
              56

            

    

     

    ARTICLE
9

    CONSOLIDATION,
MERGER, CONVEYANCE, TRANSFER OR LEASE

     

    
      	
              Section
      9.01.

            	
              Covenant
      Not to Consolidate, Merge, Convey, Transfer or Lease Property Except under
      Certain Conditions

            	
              56

            
	
              Section
      9.02.

            	
              Rights
      and Duties of Successor Corporation

            	
              56

            
	
              Section
      9.03.

            	
              Officers’
      Certificate and Opinion of Counsel Given to Purchase Contract
      Agent

            	
              56

            

    

     

    ARTICLE
10

    COVENANTS

     

    
      	
              Section
      10.01.

            	
              Performance
      Under Purchase
      Contracts                                                                                          

            	
              57

            
	
              Section
      10.02.

            	
              Maintenance
      of Office or
      Agency                                                                                          

            	
              57

            
	
              Section
      10.03.

            	
              Company
      to Reserve Common Stock and Preferred Stock

            	
              57

            
	
              Section
      10.04.

            	
              Covenants
      as to Common Stock and Preferred
      Stock                                                                                          

            	
              57

            
	
              Section
      10.05.

            	
              Statements
      of Officers of the Company as to
      Default                                                                                          

            	
              57

            
	
              Section
      10.06.

            	
              ERISA                                                                                          

            	
              58

            
	
              Section
      10.07.

            	
              Tax
      Treatment                                                                                          

            	
              58

            

    

     

    EXHIBITS

     

     

    Exhibit A
- Form of Corporate Unit Certificate

     

     

    Exhibit B
- Form of Treasury Unit Certificate

     

     

    Exhibit C
- Instruction to Purchase Contract Agent

     

     

    Exhibit D
- Notice from Purchase Contract Agent to Holders

     

     

    Exhibit E
- Notice to Settle by Cash

     

     

    Exhibit F
- Notice from Purchase Contract Agent to Collateral Agent

     

     

    Exhibit G
- Notice to Settle by Cash Upon Failed Final Remarketing

     

    
      
         

      

      
        iii

        
          

        

      

      
         

      

    

    

     

    AMENDED AND RESTATED PURCHASE
CONTRACT AGREEMENT, dated as of August 4, 2008, between PNM RESOURCES, INC., a New
Mexico corporation (the “Company”), and U.S. BANK NATIONAL
ASSOCIATION, a national banking association, acting as purchase contract
agent for the Holders of Units (as defined herein) from time to time (the “Purchase Contract
Agent”).

     

     

    RECITALS

     

     

    The Company and the Purchase Contract
Agent are parties to a Purchase Contract Agreement, dated as of October 7, 2005
(the “Original
Agreement”), relating to the Units.  Section 8.02 of the
Original Agreement provides that, with the consent of the Holders of the
Outstanding Units voting together as one class, by Act of said Holders delivered
to the Company and the Purchase Contract Agent, the Company, when duly
authorized, and the Purchase Contract Agent may enter into an agreement or
agreements supplemental to the Original Agreement for the purpose of modifying
in any manner the terms of the Purchase Contracts, or the provisions of the
Original Agreement or the rights of the Holders in respect of the
Units.  The Company proposes to amend the Original Agreement by
amending and restating the Original Agreement in its entirety as provided herein
(the “Amendment”) in
order to (i) delay the Initial Remarketing Date (as defined in the Original
Agreement), (ii) permit efforts at Remarketing to occur on each of three, rather
than two, Business Days and (iii) provide for certain other changes to the
Original Agreement.  The Company has solicited the consent of the
Holders of Outstanding Units to the Amendment and has received from and
delivered to the Purchase Contract Agent, in accordance with Section 8.02 of the
Original Agreement, Acts of the Holders of all of the Outstanding
Units.  The Company hereby requests that the Purchase Contract Agent
join with the Company in the execution and delivery of this Amended and Restated
Agreement.

     

     

    For and
in consideration of the premises, it is mutually agreed as follows:

     

     

    ARTICLE
1

     

    DEFINITIONS
AND OTHER PROVISIONS OF GENERAL APPLICATION

     

     

               Section
1.01.               Definitions. 
For all purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:

     

     

    (a)           the
terms defined in this Article have the meanings assigned to them in this Article
and include the plural as well as the singular, and nouns and pronouns of the
masculine gender include the feminine and neuter genders;

     

     

    (b)           all
accounting terms not otherwise defined herein have the meanings assigned to them
in accordance with generally accepted accounting principles in the United
States;

     

     

    (c)           the
words “herein,” “hereof”
and “hereunder” and
other words of similar import refer to this Agreement as a whole and not to any
particular Article, Section, Exhibit or other subdivision; and

     

     

    (d)           the
following terms have the meanings given to them in this Section 1.01(d):

     

     

    “Accounting Event” has the
meaning set forth in the Supplemental Indenture.

     

     

    “Act” has the meaning, with
respect to any Holder, set forth in Section 1.04(a).

     

     

    “Adjusted Applicable Market
Value” has the meaning set forth in Section 5.01(a).

     

     

    “Affiliate” of any specified
Person means any other Person directly or indirectly controlling or controlled
by or under direct or indirect common control with such specified Person. 
For the purposes of this definition, “control” when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    “Agreement” means this amended
and restated instrument as originally executed or as it may from time to time be
supplemented or amended by one or more agreements supplemental hereto entered
into pursuant to the applicable provisions hereof.

     

     

    “Amendment” has the meaning
set forth in the first recital hereof.

     

     

    “Applicable Market Value” has
the meaning set forth in Section 5.01(a).

     

     

    “Applicable Ownership
Interest” shall mean, with respect to a Corporate Unit and any Treasury
Portfolio contained in a Corporate Unit, (i) a 1/40, or 2.5%, undivided
beneficial ownership interest in $1,000 face amount of U.S. treasury securities
(or principal or interest strips thereof) included in such Treasury Portfolio
that mature on or prior to November 15, 2008 and (ii) for each scheduled Payment
Date on the Senior Notes that occurs after the Special Event Redemption Date to
and including the Purchase Contract Settlement Date, in the case of a Special
Event Redemption, an equitable percentage (such percentage to be calculated in a
manner that is internally consistent with the other calculations used in the
transaction) undivided beneficial ownership interest in $1,000 face amount of
U.S. treasury securities (or principal or interest strips thereof) included in
such Treasury Portfolio that mature on or prior to the business day immediately
preceding such scheduled Payment Date.

     

     

    “Applicable Principal Amount”
means the aggregate principal amount of the Senior Notes that are components of
Corporate Units.

     

     

    “Applicants” has the meaning
set forth in Section
7.12(b).

     

     

    “Bankruptcy Code” means Title
11 of the United States Code, or any other law of the United States that from
time to time provides a uniform system of bankruptcy laws.

     

     

    “Board of Directors” means the
board of directors of the Company or a duly authorized committee of that
board.

     

     

    “Board Resolution” means one
or more resolutions of the Board of Directors, a copy of which has been
certified by the Secretary or an Assistant Secretary of the Company, to have
been duly adopted by the Board of Directors and to be in full force and effect
on the date of such certification and delivered to the Purchase Contract
Agent.

     

     

    “Business Day” or “business day” means any day
other than a Saturday or Sunday or any other day on which banking institutions
and trust companies in New York City, New York are permitted or required by
applicable law to remain closed or a day on which the Indenture Trustee or the
Collateral Agent is closed for business.

     

     

    “Cash Merger” has the meaning
set forth in Section
5.04(b)(ii).

     

     

    “Cash Merger Early Settlement”
has the meaning set forth in Section
5.04(b)(ii).

     

     

    “Cash Merger Early Settlement
Date” has the meaning set forth in Section
5.04(b)(ii).

     

     

    “Cash Settlement” has the
meaning set forth in Section
5.02(b)(i).

     

     

    “Certificate” means a
Corporate Units Certificate or a Treasury Units Certificate.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Closing Price” has the
meaning set forth in Section
5.01(a).

     

     

    “Code” means the Internal
Revenue Code of 1986, as amended.

     

     

    “Collateral” has the meaning
set forth in Section
1.01(e) of the Pledge Agreement.

     

     

    “Collateral Account” has the
meaning set forth in Section
1.01(e) of the Pledge Agreement.

     

     

    “Collateral Agent” means U.S.
Bank National Association, as Collateral Agent under the Pledge Agreement until
a successor Collateral Agent shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter “Collateral Agent” shall mean
the Person who is then the Collateral Agent thereunder.

     

     

    “Collateral Substitution”
means (i) with respect to a Corporate Unit, (x) the substitution for the Pledged
Senior Note included in such Corporate Unit by Treasury Securities or portions
thereof in an aggregate principal amount at maturity equal to the aggregate
principal amount of such Pledged Senior Note, or (y) the substitution for the
Pledged Applicable Ownership Interest in the Treasury Portfolio included in such
Corporate Unit by Treasury Securities or portions thereof in an amount equal to
such Pledged Applicable Ownership Interest in the Treasury Portfolio, or (ii)
with respect to a Treasury Unit, (x) the substitution for the Pledged Treasury
Securities included in such Treasury Unit (if the Applicable Ownership Interest
in the Treasury Portfolio has not replaced the Senior Note as a component of the
Corporate Unit) by Senior Notes in an aggregate principal amount equal to the
aggregate principal amount at stated maturity of the Pledged Treasury
Securities, or (y) the substitution for the Pledged Treasury Securities included
in such Treasury Unit (if the Applicable Ownership Interest in the Treasury
Portfolio has replaced the Senior Note as a component of the Corporate Unit) by
the appropriate Applicable Ownership Interest in the Treasury
Portfolio.

     

     

    “Common Stock” means the
common stock, no par value, of the Company.

     

     

    “Company” means the Person
named as the “Company”
in the first paragraph of this Agreement until a successor shall have become
such pursuant to the applicable provision of this Agreement, and thereafter
“Company” shall mean
such successor.

     

     

    “Constituent Person” has the
meaning set forth in Section
5.04(b)(i).

     

     

    “Contract Adjustment Payments”
means the payments payable by the Company on the Payment Dates in respect of
each Purchase Contract, at a rate per year of 1.525% of the Stated Amount per
Purchase Contract.

     

     

    “Corporate Trust Office” means
the office of the Purchase Contract Agent at which, at any particular time, its
corporate trust business shall be principally administered, which office at the
date hereof is located at 100 Wall Street, Suite 1600, New York, New York
10005.

     

     

    “Corporate Unit” means the
collective rights and obligations of a Holder of a Corporate Units Certificate
in respect of a 1/40 undivided beneficial interest in a Senior Note or an
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, subject in each case (except for the appropriate Applicable Ownership
Interest specified in clause (ii) of the definition of such term) to the Pledge
thereof, and the related Purchase Contract.

     

     

    “Corporate Units Certificate”
means a certificate evidencing the rights and obligations of a Holder in respect
of the number of Corporate Units specified on such certificate.

     

     

    “Current Market Price” means,
in respect of a share of Common Stock on any date of determination, the average
of the daily Closing Prices for the 5 consecutive Trading Days ending the
earlier of the day in question and the day before the “ex date” with respect to
the issuance or distribution requiring such computation.  For purposes of

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    this
definition, the term “ex date,” when used with respect to any issuance or
distribution, shall mean the first date on which Common Stock trades regular way
on such exchange or in such market without the right to receive such issuance or
distribution.

     

     

    “Custodial Agent” means U.S.
Bank National Association, as Custodial Agent under the Pledge Agreement until a
successor Custodial Agent shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter “Custodial Agent” shall mean
the Person who is then the Custodial Agent thereunder.

     

     

    “Definitive Certificate” means
a Certificate that evidences all or part of the Units and is registered in the
name of a Holder or a nominee thereof.

     

     

    “Distributed Property” has the
meaning set forth in Section
5.04(a).

     

     

    “Dividend Threshold Amount”
has the meaning set forth in Section 5.04(a).

     

     

    “Early Settlement” has the
meaning set forth in Section
5.07(a).

     

     

    “Early Settlement Amount” has
the meaning set forth in Section 5.07(b).

     

     

    “Early Settlement Date” has
the meaning set forth in Section 5.07(b).

     

     

    “Early Settlement Rate” has
the meaning set forth in Section 5.07(c).

     

     

    “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended.

     

     

    “Exchange Act” means the
Securities Exchange Act of 1934 and any statute successor thereto, in each case
as amended from time to time, and the rules and regulations promulgated
thereunder.

     

     

    “Exchange Property” has the
meaning set forth in Section
5.04(b).

     

     

    “Ex-Dividend Date” has the
meaning set forth in Section
5.04(a).

     

     

    “Expiration Date” has the
meaning set forth in Section
1.04(e).

     

     

    “Expiration Time” has the
meaning set forth in Section
5.04(a)(vi).

     

     

    “Extended Maturity Date” has
the meaning set forth in Section 5.02(a).

     

     

    “Failed Final Remarketing” has
the meaning set forth in Section 5.02(a).

     

     

    “Failed Remarketing” has the
meaning set forth in Section
5.02(a).

     

     

    “Final Remarketing Date” means
the third Business Day immediately preceding the Purchase Contract Settlement
Date.

     

     

    “Fixed Settlement Rate” means
each of the Maximum Share Number and the Minimum Share Number.

     

     

    “Holder” means, with respect
to a Unit, the Person in whose name the Unit evidenced by a Certificate is
registered in the Security Register.

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    “Indemnitees” has the meaning
set forth in Section
7.07(c).

     

     

    “Indenture” means the
Indenture, dated as of October 7, 2005, between the Company and the Indenture
Trustee (including any provisions of the TIA that are deemed incorporated
therein), as supplemented by the Supplemental Indenture, pursuant to which the
Senior Notes were originally issued, and as further supplemented by the
Supplemental Indenture No. 2.

     

     

    “Indenture Trustee” means U.S.
Bank National Association, as trustee under the Indenture, or any successor
thereto.

     

     

    “Initial Remarketing Date”
means the fifth Business Day immediately preceding the Purchase Contract
Settlement Date.

     

     

    “Issuer Order” or “Issuer Request” means a
written order or request signed in the name of the Company by (i) either its
Chief Executive Officer, its President or one of its Vice Presidents, and (ii)
either its Corporate Secretary or one of its Assistant Corporate Secretaries or
its Treasurer or one of its Assistant Treasurers, and delivered to the Purchase
Contract Agent.

     

     

    “Maximum Share Number” has the
meaning set forth in Section
5.01(a)(iii).

     

     

    “Minimum Share Number” has the
meaning set forth in Section
5.01(a)(i).

     

     

    “non-electing share” has the
meaning set forth in Section
5.04(b)(i).

     

     

    “NYSE” has the meaning set
forth in Section
5.01(a).

     

     

    “Officers’ Certificate” means
a certificate signed by (i) either the Company’s Chief Executive Officer, its
President or one of its Vice Presidents, and (ii) either the Company’s Corporate
Secretary or one of its Assistant Corporate Secretaries or its Treasurer or one
of its Assistant Treasurers, and delivered to the Purchase Contract
Agent.

     

     

    “Opinion of Counsel” means a
written opinion of counsel, who may be counsel to the Company (and who may be an
employee of the Company), and who shall be reasonably acceptable to the Purchase
Contract Agent.  An Opinion of Counsel may rely on certificates as to
matters of fact.

     

     

    “Original Agreement” has the
meaning set forth in the first recital hereof.

     

     

    “Outstanding Units” means,
with respect to any Unit and as of the date of determination, all Units
evidenced by Certificates theretofore authenticated, executed and delivered
under this Agreement, except:

     

     

    (i)           if
a Termination Event has occurred, (x) Corporate Units for which the underlying
Senior Notes or Applicable Ownership Interests in the Treasury Portfolio have
been theretofore deposited with the Purchase Contract Agent in trust for the
Holders of such Corporate Units and (y) Treasury Units;

     

     

    (ii)          Units
evidenced by Certificates theretofore cancelled by the Purchase Contract Agent
or delivered to the Purchase Contract Agent for cancellation or deemed cancelled
pursuant to the provisions of this Agreement; and

     

     

    (iii)         Units evidenced by Certificates in
exchange for or in lieu of which other Certificates have been authenticated,
executed on behalf of the Holder and delivered pursuant to this Agreement, other
than any such Certificate in respect of which there shall have been presented to
the 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    Purchase Contract Agent proof
satisfactory to it that such Certificate is held by a protected purchaser in
whose hands the Units evidenced by such Certificate are valid obligations of the
Company;

     

     

    provided, however, that in determining
whether the Holders of the requisite number of the Units have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Units
owned by the Company or any Affiliate of the Company shall be disregarded and
deemed not to be Outstanding Units, except that, in determining whether the
Purchase Contract Agent shall be authorized and protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Units that a Responsible Officer of the Purchase Contract Agent actually knows
to be so owned shall be so disregarded.  Units so owned that have been
pledged in good faith may be regarded as Outstanding Units if the pledgee
establishes to the satisfaction of the Purchase Contract Agent the pledgee’s
right so to act with respect to such Units and that the pledgee is not the
Company or any Affiliate of the Company.

     

     

    “Payment Date” means each
February 16, May 16, August 16 and November 16 of each year, commencing February
16, 2006.

     

     

    “Permitted Investments” has
the meaning set forth in Section 1.01(e) of the Pledge
Agreement.

     

     

    “Person” means a legal person,
including any individual, corporation, estate, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof or any other entity of whatever nature.

     

     

    “Plan” means an employee
benefit plan that is subject to ERISA, a plan or individual retirement account
that is subject to Section 4975 of the Code or any entity whose assets are
considered assets of any such plan.

     

     

    “Pledge” means the pledge
under the Pledge Agreement of the Senior Notes, the Treasury Securities or the
appropriate Applicable Ownership Interest (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, as the case may be, in each
case constituting a part of the Units (it being understood that the appropriate
Applicable Ownership Interest (as specified in clause (ii) of the definition of
such term) in the Treasury Portfolio shall not be subject to the
Pledge).

     

     

    “Pledge Agreement” means the
Amended and Restated Pledge Agreement, dated as of August 4, 2008, among
the Company, the Collateral Agent, the Custodial Agent, the Securities
Intermediary and the Purchase Contract Agent, on its own behalf and as
attorney-in-fact for the Holders from time to time of the Units, as amended from
time to time.

     

     

    “Pledged Applicable Ownership
Interests” has the meaning set forth in Section 1.01(e) of the Pledge
Agreement.

     

     

    “Pledged Senior Notes” has the
meaning set forth in Section
1.01(e) of the Pledge Agreement.

     

     

    “Pledged Treasury Securities”
has the meaning set forth in Section 1.01(e) of the Pledge
Agreement.

     

     

    “Predecessor Certificate”
means a Predecessor Corporate Units Certificate or a Predecessor Treasury Units
Certificate.

     

     

    “Predecessor Corporate Units
Certificate” of any particular Corporate Units Certificate means every
previous Corporate Units Certificate evidencing all or a portion of the rights
and obligations of the Company and the Holder under the Corporate Units
evidenced thereby; and, for the purposes of this definition, any Corporate Units
Certificate authenticated and delivered under Section 3.10 in exchange for
or in lieu of a mutilated, destroyed, lost or stolen Corporate Units Certificate
shall be deemed to evidence the same rights and obligations of the Company and
the Holder as the mutilated, destroyed, lost or stolen Corporate Units
Certificate.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    “Predecessor Treasury Units
Certificate” of any particular Treasury Units Certificate means every
previous Treasury Units Certificate evidencing all or a portion of the rights
and obligations of the Company and the Holder under the Treasury Units evidenced
thereby; and, for the purposes of this definition, any Treasury Units
Certificate authenticated and delivered under Section 3.10 in exchange for
or in lieu of a mutilated, destroyed, lost or stolen Treasury Units Certificate
shall be deemed to evidence the same rights and obligations of the Company and
the Holder as the mutilated, destroyed, lost or stolen Treasury Units
Certificate.

     

     

    “Preferred Stock” means shares
of Preferred Stock of the Company created by the Statement of Resolutions,
convertible into shares of Common Stock as provided in the Statement of
Resolutions.

     

     

    “Primary Treasury Dealer”
shall mean a primary U.S. government securities dealer.

     

     

    “Private Placement Legend”
shall have the meaning set forth in Section 3.06(b).

     

     

    “Proceeds” has the meaning set
forth in Section 1.01(e)
of the Pledge Agreement.

     

     

    “Prospectus” means the
prospectus relating to the delivery of shares or any securities in connection
with an Early Settlement pursuant to Section 5.07 or a Cash Merger
Early Settlement of Purchase Contracts pursuant to Section 5.04(b)(ii), in the
form in which first filed, or transmitted for filing, with the Securities and
Exchange Commission after the effective date of the Registration Statement
pursuant to Rule 424(b) under the Securities Act, including the documents
incorporated by reference therein as of the date of such
Prospectus.

     

     

    “Purchase Contract” means,
with respect to any Unit, the contract forming a part of such Unit and
obligating the Company to (i) sell, and the Holder of such Unit to purchase,
shares of Common Stock or Preferred Stock, as applicable, and (ii) pay the
Holder thereof Contract Adjustment Payments, in each case on the terms and
subject to the conditions set forth in Article 5 hereof.

     

     

    “Purchase Contract Agent”
means the Person named as the “Purchase Contract Agent” in
the first paragraph of this Agreement until a successor Purchase Contract Agent
shall have become such pursuant to the applicable provisions of this Agreement,
and thereafter “Purchase
Contract Agent” shall mean such Person or any subsequent successor who is
appointed pursuant to this Agreement.

     

     

    “Purchase Contract Settlement
Date” means November 16, 2008.

     

     

    “Purchase Contract Settlement
Fund” has the meaning set forth in Section 5.03.

     

     

    “Purchase Price” has the
meaning set forth in Section
5.01(a).

     

     

    “Purchased Shares” has the
meaning set forth in Section
5.04(a)(vi).

     

     

    “Put Right” has the meaning
set forth in Section
8.05 of the Supplemental Indenture.

     

     

    “Quotation Agent” means any
Primary Treasury Dealer selected by the Company.

     

     

    “Record Date” for any
distribution and Contract Adjustment Payment payable on any Payment Date means,
as to any Certificate, the first business day of the calendar month in which the
relevant Payment Date falls; provided that the Company
may, at its option, select any other day as the Record Date for any Payment Date
so long as such Record Date selected is more than one Business Day but less than
60 Business Days prior to such Payment Date.

     

     

    “Redemption Amount” has the
meaning set forth in Section
1.02(e) of the Supplemental Indenture.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    “Redemption Price” has the
meaning set forth in Section
1.02(e) of the Supplemental Indenture.

     

     

    “Reference Dealer” means a
dealer engaged in trading of convertible securities.

     

     

    “Reference Price” has the
meaning set forth in Section
5.01(a)(ii).

     

     

    “Registration Statement” means
a registration statement under the Securities Act prepared by the Company
covering, inter alia, the delivery by the Company of any securities in
connection with an Early Settlement on the Early Settlement Date or a Cash
Merger Early Settlement of Purchase Contracts on the Cash Merger Early
Settlement Date under Section
5.04(b)(ii), including all exhibits thereto and the documents
incorporated by reference in the prospectus contained in such registration
statement, and any post-effective amendments thereto.

     

     

    “Remarketing” means the
remarketing of the Senior Notes by the Remarketing Agent pursuant to the
Remarketing Agreement.

     

     

    “Remarketing Agent” has the
meaning set forth in the Remarketing Agreement.

     

     

    “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 Date” means the
Initial Remarketing Date, the Second Remarketing Date or the Final Remarketing
Date.

     

     

    “Remarketing Fee” has the
meaning set forth in Section
4 of the Remarketing Agreement.

     

     

    “Remarketing Price” has the
meaning set forth in Section
5.02(a).

     

     

    “Reorganization Event” has the
meaning set forth in Section
5.04(b)(i).

     

     

    “Resale Restriction Termination
Date” means, for any Restricted Unit (or beneficial interest therein),
one-year (or such other period specified in Rule 144 (or any successor
provision)) from the date of issuance.

     

     

    “Reset Rate” has the meaning
set forth in Section
1.02(e) of the Supplemental Indenture.

     

     

    “Responsible Officer” shall
mean, when used with respect to the Purchase Contact Agent, any officer within
the corporate trust department of the Purchase Contract Agent, including any
vice president, assistant vice president, assistant secretary, assistant
treasurer, trust officer or any other officer of the Purchase Contract Agent who
customarily performs functions similar to those performed by the Persons who at
the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person’s knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of this Purchase Contract Agreement.

     

     

    “Restricted Unit” means any
Unit (or beneficial interest therein) until such time as:

     

     

    (i)           such
Unit (or beneficial interest therein) has been transferred pursuant to a
Registration Statement

     

     

    (ii)           the
Resale Restriction Termination Date therefor has passed; or

     

     

    (iii)           the Private Placement Legend therefor
has otherwise been removed pursuant to Section
3.05.

     

     

    “Rights” has the meaning set
forth in Section
5.04(a).

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    “Rule 144” means Rule 144 under
the Securities Act (or any successor rule).

     

     

    “Rule 144A” means Rule 144A
under the Securities Act (or any successor rule).

     

     

    “Second Remarketing Date”
means the fourth Business Day immediately preceding the Purchase Contract
Settlement Date.

     

     

    “Securities Act” means the
Securities Act of 1933 and any statute successor thereto, in each case as
amended from time to time, and the rules and regulations promulgated
thereunder.

     

     

    “Securities Intermediary”
means U.S. Bank National Association, as Securities Intermediary under the
Pledge Agreement until a successor Securities Intermediary shall have become
such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter “Securities
Intermediary” shall mean such successor or any subsequent successor who
is appointed pursuant to the Pledge Agreement.

     

     

    “Security Register” and “Security Registrar” have the
respective meanings set forth in Section 3.05.

     

     

    “Senior Indebtedness” means
indebtedness of any kind of the Company unless the instrument under which such
indebtedness is incurred expressly provides that it is on a parity in right of
payment with or subordinate in right of payment to the Contract Adjustment
Payments.

     

     

    “Senior Notes” means the
series of notes designated the senior notes due 2010 to be issued by the Company
under the Indenture.

     

     

    “Separate Senior Notes” means
Senior Notes that are no longer a component of Corporate Units.

     

     

    “Separate Senior Notes Purchase
Price” means the amount in cash equal to the product of the Remarketing
Price multiplied by the number of Separate Senior Notes remarketed in the
Remarketing.

     

     

    “Settlement Rate” has the
meaning set forth in Section
5.01(a).

     

     

    “Special Event” has the
meaning set forth in Section
1.02(e) of the Supplemental Indenture.

     

     

    “Special Event Redemption”
means the redemption of the Senior Notes pursuant to the Indenture following the
occurrence of a Special Event.

     

     

    “Special Event Redemption
Date” means the date upon which a Special Event Redemption is scheduled
to occur pursuant to the Indenture.

     

     

    “Stated Amount” means, with
respect to any one Corporate Unit or Treasury Unit, $25, and, with respect to
any one Senior Note, $1,000.

     

     

    “Statement of Resolutions”
means the Statement of Resolutions Establishing a Series of Preferred Stock of
PNM Resources, Inc. adopted by the Board of Directors of the Company on
September 28, 2004, to be filed by the Company with the New Mexico Public
Regulation Commission prior to the Purchase Contract Settlement
Date.

     

     

    “Successful Remarketing” has
the meaning set forth in Section 5.02(a).

     

     

    “Supplemental Indenture” means
the Supplemental Indenture, dated as of October 7, 2005, between the
Company and the Indenture Trustee.

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    “Supplemental Indenture No. 2”
means the Supplemental Indenture No. 2, dated as of the date hereof, between the
Company and the Indenture Trustee.

     

     

    “Tax Event” has the meaning
set forth in Section 1.02(e)
of the Supplemental Indenture.

     

     

    “Termination Date” means the
date, if any, on which a Termination Event occurs.

     

     

    “Termination Event” means the
occurrence of any of the following events:

     

     

    (i)           at
any time on or prior to the Purchase Contract Settlement Date, a judgment,
decree or court order shall have been entered granting relief under the
Bankruptcy Code, adjudicating the Company to be insolvent, or approving as
properly filed a petition seeking reorganization or liquidation of the Company
or any other similar applicable federal or state law and if such judgment,
decree or order shall have been entered more than 60 days prior to the Purchase
Contract Settlement Date, such decree or order shall have continued undischarged
and unstayed for a period of 60 days;

     

     

    (ii)           at
any time on or prior to the Purchase Contract Settlement Date, a judgment,
decree or court order for the appointment of a receiver or liquidator or trustee
or assignee in bankruptcy or insolvency of the Company or of its property, or
for the termination or liquidation of its affairs, shall have been entered and
if such judgment, decree or order shall have been entered more than 60 days
prior to the Purchase Contract Settlement Date, such judgment, decree or order
shall have continued undischarged and unstayed for a period of 60 days;
or

     

     

    (iii)           at
any time on or prior to the Purchase Contract Settlement Date, the Company shall
file a petition for relief under the Bankruptcy Code, or shall consent to the
filing of a bankruptcy proceeding against it, or shall file a petition or answer
or consent seeking reorganization or liquidation under the Bankruptcy Code or
any other similar applicable federal or state law, or shall consent to the
filing of any such petition, or shall consent to the appointment of a receiver
or liquidator or trustee or assignee in bankruptcy or insolvency of it or of its
property, or shall make an assignment for the benefit of creditors, or shall
admit in writing its inability to pay its debts generally as they become
due.

     

     

    “Threshold Appreciation Price”
has the meaning set forth in Section 5.01(a).

     

     

    “TIA” means the Trust
Indenture Act of 1939, as amended from time to time, or any successor
legislation.

     

     

    “Trading Day” has the meaning
set forth in Section
5.01(a).

     

     

    “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 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
Payment Date in an aggregate amount at maturity equal to the aggregate interest
payment (assuming no reset of the interest rate) that would have been due on
such scheduled 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.

     

     

    “Treasury Securities” means
zero-coupon U.S. treasury securities that mature on November 15, 2008 (CUSIP No.
912828EC0).

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    “Treasury Unit” means,
following the substitution of Treasury Securities for Pledged Senior Notes or
the Pledged Applicable Ownership Interest in the Treasury Portfolio as
collateral to secure a Holder’s obligations under the Purchase Contract, the
collective rights and obligations of a Holder of a Treasury Units Certificate in
respect of such Treasury Securities, subject to the Pledge thereof, and the
related Purchase Contract.

     

     

    “Treasury Units Certificate”
means a certificate evidencing the rights and obligations of a Holder in respect
of the number of Treasury Units specified on such certificate.

     

     

    “Trigger Event” has the
meaning set forth in Section
5.04(a).

     

     

    “Unit” means a Corporate Unit
or a Treasury Unit, as the case may be.

     

     

    “Vice President” means any
vice president, whether or not designated by a number or a word or words added
before or after the title “Vice
President.”

     

     

    Section
1.02.          Compliance Certificates and
Opinions.  Except as otherwise expressly provided by this Agreement,
upon any application or request by the Company to the Purchase Contract Agent to
take any action in accordance with any provision of this Agreement, the Company
shall furnish to the Purchase Contract Agent an Officers’ Certificate stating
that all conditions precedent, if any, provided for in this Agreement relating
to the proposed action have been complied with and an Opinion of Counsel stating
that, in the opinion of such counsel, all such conditions precedent, if any,
have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically required by
any provision of this Agreement relating to such particular application or
request, no additional certificate or opinion need be furnished.

     

     

    Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Agreement (other than the Officers’ Certificate provided
for in Section 10.05)
shall include:

     

     

    (i)           a
statement that each individual signing such certificate or opinion has read such
covenant or condition and the definitions herein relating thereto;

     

     

    (ii)           a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based;

     

     

    (iii)           a
statement that, in the opinion of each such individual, he or she has made such
examination or investigation as is necessary to enable such individual to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and

     

     

    (iv)           a
statement as to whether, in the opinion of each such individual, such condition
or covenant has been complied with.

     

     

    Section
1.03.          Form of Documents Delivered
to Purchase Contract Agent.  In any case where several matters are
required to be certified by, or covered by an opinion of, any specified Person,
it is not necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or covered by
only one document, but one such Person may certify or give an opinion with
respect to some matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such matters in one or
several documents.  Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which its certificate or
opinion is based are erroneous.  Any such certificate or Opinion of Counsel
may be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Company unless
such counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    Where any
Person is required to make, give or execute two or more applications, requests,
consents, certificates, statements, opinions or other instruments under this
Agreement, they may, but need not, be consolidated and form one
instrument.

     

     

    Section
1.04.          Acts of Holders; Record
Dates.  (a)  Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Agreement to be given
or taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Purchase Contract Agent and, where it is hereby expressly
required, to the Company.  Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
“Act” of the Holders
signing such instrument or instruments.  Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.01) conclusive in
favor of the Purchase Contract Agent and the Company, if made in the manner
provided in this Section.

     

     

    (b)           The
fact and date of the execution by any Person of any such instrument or writing
may be proved in any manner that the Purchase Contract Agent deems
sufficient.

     

     

    (c)           The
ownership of Units shall be proved by the Security Register.

     

     

    (d)           Any
request, demand, authorization, direction, notice, consent, waiver or other Act
of the Holder of any Unit shall bind every future Holder of the same Unit and
the Holder of every Certificate evidencing such Unit issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Purchase
Contract Agent or the Company in reliance thereon, whether or not notation of
such action is made upon such Certificate.

     

     

    (e)           The
Company may set any date as a record date for the purpose of determining the
Holders of Outstanding Units entitled to give, make or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Agreement to be given, made or taken by Holders of
Units.  If any record date is set pursuant to this paragraph, the Holders
of the Outstanding Corporate Units and the Outstanding Treasury Units, as the
case may be, on such record date, and no other Holders, shall be entitled to
take the relevant action with respect to the Corporate Units or the Treasury
Units, as the case may be, whether or not such Holders remain Holders after such
record date; provided
that no such action shall be effective hereunder unless taken prior to or
on the applicable Expiration Date by Holders of the requisite number of
Outstanding Units on such record date.  Nothing contained in this paragraph
shall be construed to prevent the Company from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and be of no effect), and nothing contained
in this paragraph shall be construed to render ineffective any action taken by
Holders of the requisite number of Outstanding Units on the date such action is
taken.  Promptly after any record date is set pursuant to this paragraph,
the Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Purchase Contract Agent in writing and to each Holder of Units in the manner set
forth in Section
1.06.

     

     

    With
respect to any record date set pursuant to this Section 1.04(e), the Company
may designate any date as the “Expiration Date” and from
time to time may change the Expiration Date to any earlier or later day; provided that no such change
shall be effective unless notice of the proposed new Expiration Date is given to
the Purchase Contract Agent in writing, and to each Holder of Units in the
manner set forth in Section
1.06, prior to or on the existing Expiration Date.  If an Expiration
Date is not designated with respect to any record date set pursuant to this
Section, the Company shall be deemed to have initially designated the 180th day
after such record date as the Expiration Date with respect thereto, subject to
its right to change the Expiration Date as provided in this paragraph. 
Notwithstanding the foregoing, no Expiration Date shall be later than the 180th
day after the applicable record date.

     

     

    Section
1.05.          Notices.  Any
notice or communication is duly given if in writing and delivered in Person or
mailed by first-class mail (registered or certified, return receipt requested),
telecopier (with receipt

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    confirmed)
or overnight air courier guaranteeing next day delivery, to the others’ address;
provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt
thereof:

     

     

    If to the
Purchase Contract Agent:

     

    U.S. Bank
National Association

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

    If to the
Company:

     

     

    PNM
Resources, Inc.

    Alvarado
Square MS-2704

    Albuquerque,
New Mexico 87158

    Attention: 
Treasurer

    Telephone: 
(505) 241-2700

    Telecopy: 
(505) 241-2369

     

    If to the
Collateral Agent:

     

     

    U.S. Bank
National Association

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

    If to the
Indenture Trustee:

     

     

    U.S. Bank
National Association

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

     

    The
Purchase Contract Agent shall send to the Indenture Trustee at the telecopier
number set forth above a copy of any notices in the form of Exhibits C, D, E, F or G it sends or
receives.

     

     

    Section
1.06.          Notice to
Holders; Waiver. 
Where this Agreement provides for notice to Holders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each Holder affected by such
event, at its address as it appears in the Security Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice.  In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder, shall affect the sufficiency of such notice with
respect to other Holders.  Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice.  Waivers of notice by Holders shall be filed
with the Purchase Contract Agent, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such
waiver.  In case
by reason of the suspension of regular mail service or by reason of any other
cause it shall be impracticable to give such notice by 

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    mail, then such notification as shall
be made with the approval of the Purchase Contract Agent shall constitute a
sufficient notification for every purpose hereunder.

     

     

    Section
1.07.          Effect of Headings and Table
of Contents.  The Article and Section headings herein and the Table
of Contents are for convenience only and shall not affect the construction
hereof.

     

     

    Section
1.08.          Successors and
Assigns.  All covenants and agreements in this Agreement by the
Company and the Purchase Contract Agent shall bind their respective successors
and assigns, whether so expressed or not.

     

     

    Section
1.09.          Separability
Clause.  In case any provision in this Agreement or in the Units
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof and thereof shall not in any
way be affected or impaired thereby.

     

     

    Section
1.10.          Benefits of
Agreement.  Nothing contained in this Agreement or in the Units,
express or implied, shall give to any Person, other than the parties hereto and
their successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this
Agreement.  The Holders from time to time shall be beneficiaries of this
Agreement and shall be bound by all of the terms and conditions hereof and of
the Units evidenced by their Certificates by their acceptance of delivery of
such Certificates.

     

     

    Section
1.11.          Governing Law. 
This Agreement and the Units shall be governed by, and construed in accordance
with, the laws of the State of New York.

     

     

    Section
1.12.          Legal Holidays. 
In any case where any Payment Date shall not be a Business Day (notwithstanding
any other provision of this Agreement or the Units), Contract Adjustment
Payments or other distributions shall not be paid on such date, but Contract
Adjustment Payments or such other distributions shall be paid on the next
succeeding Business Day with the same force and effect as if made on such
Payment Date, provided
that if such Business Day is in the next succeeding calendar year, then payment
of the Contract Adjustment Payments or other distributions will be made on the
Business Day immediately preceding such Business Day.  No interest shall
accrue or be payable by the Company or to any Holder for the period from and
after any such Payment Date.

     

     

    In any
case where the Purchase Contract Settlement Date or any Early Settlement Date or
Cash Merger Early Settlement Date shall not be a Business Day (notwithstanding
any other provision of this Agreement or the Units), Purchase Contracts shall
not be performed and Early Settlement and Cash Merger Early Settlement shall not
be effected on such date and Remarketing of Senior Notes shall not settle on
such date, but Purchase Contracts shall be performed or Early Settlement or Cash
Merger Early Settlement shall be effected or remarketed Senior Notes shall be
settled, as applicable, on the next succeeding Business Day with the same force
and effect as if made on such Purchase Contract Settlement Date, Early
Settlement Date or Cash Merger Early Settlement Date, as
applicable.

     

     

    Section
1.13.          Counterparts. 
This Agreement may be executed in any number of counterparts by the parties
hereto on separate counterparts, each of which, when so executed and delivered,
shall be deemed an original, but all such counterparts shall together constitute
one and the same instrument.

     

     

    Section
1.14.          Inspection of
Agreement.  A copy of this Agreement shall be available at all
reasonable times during normal business hours at the Corporate Trust Office for
inspection by any Holder.

     

     

    Section
1.15.          Appointment of Financial
Institution as Agent for the Company.  The Company may appoint a
financial institution (which may be the Collateral Agent) to act as its agent in
performing its obligations and in accepting and enforcing performance of the
obligations of the Purchase Contract Agent and the Holders, under this Agreement
and the Purchase Contracts, by giving notice of such appointment in the manner
provided in Section 1.05
hereof.

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    Any such
appointment shall not relieve the Company in any way from its obligations
hereunder.

     

     

    Section
1.16.          No Waiver.  No
failure on the part of the Company, the Purchase Contract Agent, the Collateral
Agent, the Securities Intermediary or any of their respective agents to
exercise, and no course of dealing with respect to, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Company, the Collateral Agent, the
Securities Intermediary or any of their respective agents of any right, power or
remedy hereunder preclude any other or further exercise thereof or the exercise
of any other right, power or remedy.  The remedies herein are cumulative
and are not exclusive of any remedies provided by law.

     

     

    ARTICLE
2

     

    CERTIFICATE
FORMS

     

     

    Section
2.01.          Forms of Certificates
Generally.  The Certificates (including the form of Purchase
Contract forming part of each Unit evidenced thereby) shall be in substantially
the form set forth in Exhibit A hereto (in the case of Certificates evidencing
Corporate Units) or Exhibit B hereto (in the case of Certificates evidencing
Treasury Units), with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Units are listed or any depositary therefor, or as may, consistently herewith,
be determined by the officers of the Company executing such Certificates, as
evidenced by their execution of the Certificates.

     

     

    The
definitive Certificates shall be produced in any manner as determined by the
officers of the Company executing the Units evidenced by such Certificates,
consistent with the provisions of this Agreement, as evidenced by their
execution thereof.

     

     

    Section
2.02.          Form of Purchase Contract
Agent’s Certificate of Authentication.  The form of the Purchase
Contract Agent’s certificate of authentication of the Units shall be in
substantially the form set forth on the form of the applicable
Certificates.

     

     

    ARTICLE
3

     

    THE
UNITS

     

     

    Section
3.01.          Amount; Form and
Denominations.  The aggregate number of Units evidenced by
Certificates authenticated, executed on behalf of the Holders and delivered
hereunder is limited to 4,000,000, except for Certificates authenticated,
executed and delivered upon registration of transfer of, in exchange for, or in
lieu of, other Certificates pursuant to Section 3.04, 3.05, 3.10, 3.13, 3.14 or 8.05.

     

     

    The
Certificates shall be issuable only in registered form and only in denominations
of a single Corporate Unit or Treasury Unit and any integral multiple
thereof.

     

     

    Section
3.02.          Rights and Obligations
Evidenced by the Certificates.  Each Corporate Units Certificate
shall evidence the number of Corporate Units specified therein, with each such
Corporate Unit representing (1) the ownership by the Holder thereof of a 1/40
undivided beneficial interest in a Senior Note or the Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, subject to the Pledge of
such Senior Note or the Applicable Ownership Interest (as specified in clause
(i) of the definition of such term) in the Treasury Portfolio, as the case may
be, by such Holder pursuant to the Pledge Agreement, and (2) the rights and
obligations of the Holder thereof and the Company under one Purchase
Contract.  The Purchase Contract Agent is hereby authorized, as
attorney-in-fact for, and on behalf of, the Holder of each Corporate Unit, to
pledge, pursuant to the Pledge Agreement, the Senior Note and the Applicable
Ownership Interest (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, if any, forming a part of such Corporate Unit, to the
Collateral Agent for the benefit of the Company, and to grant to the Collateral
Agent, for the benefit of the Company, a security interest in the right, title
and interest of such Holder in such Senior Note and the Applicable Ownership
Interest (as specified in 

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    clause
(i) of the definition of such term) in the Treasury Portfolio, if any, to secure
the obligation of the Holder under each Purchase Contract to purchase shares of
Common Stock or Preferred Stock, as applicable.

     

     

    Upon the
formation of a Treasury Unit pursuant to Section 3.13, each Treasury
Unit Certificate shall evidence the number of Treasury Units specified therein,
with each such Treasury Unit representing (1) the ownership by the Holder
thereof of a 1/40 undivided beneficial interest in a Treasury Security with a
principal amount at maturity equal to $1,000, subject to the Pledge of such
interest by such Holder pursuant to the Pledge Agreement, and (2) the rights and
obligations of the Holder thereof and the Company under one Purchase
Contract.  The Purchase Contract Agent is hereby authorized, as
attorney-in-fact for, and on behalf of, the Holder of each Treasury Unit, to
pledge, pursuant to the Pledge Agreement, such Holder’s interest in the Treasury
Security forming a part of such Treasury Unit to the Collateral Agent, for the
benefit of the Company, and to grant to the Collateral Agent, for the benefit of
the Company, a security interest in the right, title and interest of such Holder
in such Treasury Security to secure the obligation of the Holder under each
Purchase Contract to purchase shares of Common Stock or Preferred Stock, as
applicable.

     

     

    Prior to
the purchase of shares of Common Stock or Preferred Stock, as applicable, under
each Purchase Contract, such Purchase Contract shall not entitle the Holder of a
Unit to any of the rights of a holder of shares of Common Stock or Preferred
Stock, as applicable, including, without limitation, the right to vote or
receive any dividends or other payments or to consent or to receive notice as a
shareholder in respect of the meetings of shareholders or for the election of
directors of the Company or for any other matter, or any other rights whatsoever
as a shareholder of the Company.

     

     

    Section
3.03.          Execution, Authentication,
Delivery and Dating.  Subject to the provisions of Sections 3.13 and 3.14 hereof,
upon the execution and delivery of this Agreement, and at any time and from time
to time thereafter, the Company may deliver Certificates executed by the Company
to the Purchase Contract Agent for authentication, execution on behalf of the
Holders and delivery, together with its Issuer Order for authentication of such
Certificates, and the Purchase Contract Agent in accordance with such Issuer
Order shall authenticate, execute on behalf of the Holders and deliver such
Certificates.

     

     

    The
Certificates shall be executed on behalf of the Company by its Chairman of the
Board of Directors, its Chief Executive Officer, its President, its Chief
Financial Officer, its Treasurer or one of its Vice Presidents.  The
signature of any of these officers on the Certificates may be manual or
facsimile.

     

     

    Certificates
bearing the manual or facsimile signatures of individuals who were at any time
the proper officers of the Company shall bind the Company, notwithstanding that
such individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Certificates or did not hold such offices at
the date of such Certificates.

     

     

    No
Purchase Contract evidenced by a Certificate shall be valid until such
Certificate has been executed on behalf of the Holder by the manual signature of
an authorized officer of the Purchase Contract Agent, as such Holder’s
attorney-in-fact.  Such signature by an authorized officer of the Purchase
Contract Agent shall be conclusive evidence that the Holder of such Certificate
has entered into the Purchase Contracts evidenced by such
Certificate.

     

     

    Each
Certificate shall be dated the date of its authentication.

     

     

    No
Certificate shall be entitled to any benefit under this Agreement or be valid or
obligatory for any purpose unless there appears on such Certificate a
certificate of authentication substantially in the form provided for herein
executed by an authorized officer of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.

     

     

    Section
3.04.          Temporary
Certificates.  Pending the preparation of definitive Certificates,
the Company shall execute and deliver to the Purchase Contract Agent, and the
Purchase Contract Agent shall authenticate, 

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    execute
on behalf of the Holders, and deliver, in lieu of such definitive Certificates,
temporary Certificates that are in substantially the form set forth in Exhibit A or Exhibit B hereto, as the case
may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Corporate Units or Treasury Units, as the case may be, are listed, or as may,
consistently herewith, be determined by the officers of the Company executing
such Certificates, as evidenced by their execution of the
Certificates.

     

     

    If
temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay.  After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the Corporate Trust Office, at the expense of the Company and
without charge to the Holder.  Upon surrender for cancellation of any one
or more temporary Certificates, the Company shall execute and deliver to the
Purchase Contract Agent, and the Purchase Contract Agent shall authenticate,
execute on behalf of the Holder, and deliver in exchange therefor, one or more
definitive Certificates of like tenor and denominations and evidencing a like
number of Units as the temporary Certificate or Certificates so
surrendered.  Until so exchanged, the temporary Certificates shall in all
respects evidence the same benefits and the same obligations with respect to the
Units evidenced thereby as definitive Certificates.

     

     

    Section
3.05.          Registration; Registration
of Transfer and Exchange.  The Purchase Contract Agent shall keep at
the Corporate Trust Office a register (the “Security Register”) in which,
subject to such reasonable regulations as it may prescribe, the Purchase
Contract Agent shall provide for the registration of Certificates and of
transfers of Certificates (the Purchase Contract Agent, in such capacity, the
“Security
Registrar”).  The Security Registrar shall record separately the
registration and transfer of the Certificates evidencing Corporate Units and
Treasury Units.

     

     

    Upon
surrender for registration of transfer of any Certificate at the Corporate Trust
Office, the Company shall execute and deliver to the Purchase Contract Agent,
and the Purchase Contract Agent shall authenticate, execute on behalf of the
designated transferee or transferees, and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of any authorized
denominations, like tenor, and evidencing a like number of Corporate Units or
Treasury Units, as the case may be.

     

     

    At the
option of the Holder, Certificates may be exchanged for other Certificates, of
any authorized denominations and evidencing a like number of Corporate Units or
Treasury Units, as the case may be, upon surrender of the Certificates to be
exchanged at the Corporate Trust Office.  Whenever any Certificates are so
surrendered for exchange, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the Holder, and deliver the Certificates that the Holder making the
exchange is entitled to receive.

     

     

    All
Certificates issued upon any registration of transfer or exchange of a
Certificate shall evidence the ownership of the same number of Corporate Units
or Treasury Units, as the case may be, and be entitled to the same benefits and
subject to the same obligations under this Agreement as the Corporate Units or
Treasury Units, as the case may be, evidenced by the Certificate surrendered
upon such registration of transfer or exchange.

     

     

    Every
Certificate presented or surrendered for registration of transfer or exchange
shall (if so required by the Purchase Contract Agent) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Purchase Contract Agent duly executed, by the Holder thereof or
its attorney duly authorized in writing.

     

     

    No
service charge shall be made for any registration of transfer or exchange of a
Certificate, but the Company and the Purchase Contract Agent may require payment
from the Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Certificates, other than any exchanges pursuant to Sections 3.04, 3.06 and 8.05 not involving any
transfer.

     

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    Any
transfer of Restricted Units shall be made only upon receipt by the Purchase
Contract Agent of such opinions of counsel, certificates and/or other
information reasonably required by and satisfactory to it in order to ensure
compliance with the Securities Act or in accordance with the terms of the
following paragraph.

     

     

    Upon the
transfer, exchange or replacement of Units not bearing a Private Placement
Legend, the Purchase Contract Agent shall exchange such Units for Units that do
not bear a Private Placement Legend. Upon the transfer, exchange or replacement
of Units bearing a Private Placement Legend, the Purchase Contract Agent shall
deliver only Units that bear a Private Placement Legend unless:

     

     

    (i)           such
Units are transferred pursuant to a Registration Statement;

     

     

    (ii)           such
Units are transferred pursuant to Rule 144 upon delivery to the Purchase
Contract Agent of a certificate of the transferor in a form that may be agreed
to between the Company and the Purchase Contract Agent and an Opinion of Counsel
reasonably satisfactory to the Purchase Contract Agent and the
Company;

     

     

    (iii)           such
Units are transferred, replaced or exchanged after the Resale Restriction
Termination Date therefor; or

     

     

    (iv)           in
connection with such transfer, exchange or replacement, the Purchase Contract
Agent and the Company shall have received an Opinion of Counsel and other
evidence reasonably satisfactory to it to the effect that neither such Private
Placement Legend nor the related restrictions on transfer are required in order
to maintain compliance with the provisions of the Securities Act.

     

     

    The
Private Placement Legend on any Unit shall be removed at the request of the
Holder on or after the Resale Restriction Termination Date therefor. The Company
shall deliver to the Purchase Contract Agent an Officers’ Certificate promptly
upon effectiveness, withdrawal or suspension of any Registration
Statement.

     

     

    Notwithstanding
the foregoing, the Company shall not be obligated to execute and deliver to the
Purchase Contract Agent, and the Purchase Contract Agent shall not be obligated
to authenticate, execute on behalf of the Holder and deliver any Certificate in
exchange for any other Certificate presented or surrendered for registration of
transfer or for exchange on or after the Business Day immediately preceding the
earliest to occur of any Early Settlement Date with respect to such Certificate,
any Cash Merger Early Settlement Date with respect to such Certificate, the
Purchase Contract Settlement Date or the Termination Date.  In lieu of
delivery of a new Certificate, upon satisfaction of the applicable conditions
specified above in this Section and receipt of appropriate registration or
transfer instructions from such Holder, the Purchase Contract Agent
shall:

     

     

    (i)           if
the Purchase Contract Settlement Date (including upon any Cash Settlement) or an
Early Settlement Date or a Cash Merger Early Settlement Date with respect to
such other Certificate has occurred, deliver the shares of Common Stock or
Preferred Stock, as applicable, issuable in respect of the Purchase Contracts
forming a part of the Units evidenced by such other Certificate; or

     

     

    (ii)           if
a Termination Event shall have occurred prior to the Purchase Contract
Settlement Date, transfer the Senior Notes, the Treasury Securities, or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, evidenced thereby, in each case subject to the applicable conditions and
in accordance with the applicable provisions of Section 3.15 and Article 5 hereof.

     

     

    Section
3.06.          Form of Private Placement
Legends.  (a) Each Restricted Unit shall bear the following
legend:

     

     

    THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES
ACT”), AND MAY NOT BE SOLD OR OTHERWISE 

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    TRANSFERRED
IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. 
EACH PURCHASER OF ANY OF THESE SECURITIES IS HEREBY NOTIFIED THAT THE SELLER OF
ANY OF THESE SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

     

     

    THESE
SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)
(1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
ACQUIRING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A (IF AVAILABLE), (2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE), (3) TO AN ACCREDITED INVESTOR WITHIN THE
MEANING OF RULE 501(a) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT (IF AVAILABLE) OR (4)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND
(B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.

     

     

    IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE PURCHASE CONTRACT
AGENT SUCH OPINIONS OF COUNSEL, CERTIFICATES AND/OR OTHER INFORMATION AS IT MAY
REASONABLY REQUIRE IN FORM REASONABLY SATISFACTORY TO IT AS PROVIDED FOR IN THE
INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS
AS PROVIDED FOR IN THE INDENTURE.

     

     

    (b)           Each
Restricted Unit shall bear the private placement legends specified therefor in
Section 3.06(a) on the
face thereof (together, the “Private Placement
Legend”).

     

     

    Section
3.07.          Notices to
Holders.  Whenever a notice or other communication to the Holders is
required to be given under this Agreement, the Company or the Company’s agent
shall give such notices and communications to the Holders.

     

     

    Section
3.08.          Intentionally
Omitted. 

     

     

    Section
3.09.          Definitive
Certificates.  The Certificates, on original issuance, will be
issued in the form of one or more Definitive Certificates, to be delivered to
the Holders.  Each such Definitive Certificate shall initially be
registered on the books and records of the Company in the name of the Holder to
whom it is issued, or such Holder’s nominee.

     

     

    Section
3.10.          Mutilated, Destroyed, Lost
and Stolen Certificates.  If any mutilated Certificate is
surrendered to the Purchase Contract Agent, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
a new Certificate, evidencing the same number of Corporate Units or Treasury
Units, as the case may be, and bearing a Certificate number not
contemporaneously outstanding.

     

     

    If there
shall be delivered to the Company and the Purchase Contract Agent (i) evidence
to their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) such security or indemnity as may be required by them to hold each of them
and any agent of any of them harmless, then, in the absence of notice to the
Company or the Purchase Contract Agent that such Certificate has been acquired
by a protected purchaser, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the Holder, and deliver to the Holder, in lieu of any such destroyed,
lost or stolen Certificate, a new Certificate, evidencing the same number of
Corporate Units or Treasury Units, as the case may be, and bearing a Certificate
number not contemporaneously outstanding.

     

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    Notwithstanding
the foregoing, the Company shall not be obligated to execute and deliver to the
Purchase Contract Agent, and the Purchase Contract Agent shall not be obligated
to authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Certificate on or after the Business Day immediately preceding the earliest of
any Early Settlement Date with respect to such lost or mutilated Certificate,
any Cash Merger Early Settlement Date with respect to such lost or mutilated
Certificate, the Purchase Contract Settlement Date or the Termination
Date.  In lieu of delivery of a new Certificate, upon satisfaction of the
applicable conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Purchase Contract
Agent shall:

     

     

    (i)           if
the Purchase Contract Settlement Date or Early Settlement Date or Cash Merger
Early Settlement Date with respect to such lost, stolen, destroyed or mutilated
Certificate has occurred, deliver the shares of Common Stock or Preferred Stock,
as applicable, issuable in respect of the Purchase Contracts forming a part of
the Units evidenced by such Certificate; or

     

     

    (ii)           if
a Cash Settlement with respect to such lost or mutilated Certificate or if a
Termination Event shall have occurred prior to the Purchase Contract Settlement
Date, transfer the Senior Notes, the Treasury Securities or the appropriate
Applicable Ownership Interest (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio, as the case may be, evidenced thereby, in
each case subject to the applicable conditions and in accordance with the
applicable provisions of Section 3.15 and Article 5 hereof.

     

     

    Upon the
issuance of any new Certificate under this Section, the Company and the Purchase
Contract Agent may require the payment by the Holder of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other fees and expenses (including, without limitation, the fees
and expenses of the Purchase Contract Agent) connected therewith.

     

     

    Every new
Certificate issued pursuant to this Section in lieu of any destroyed, lost or
stolen Certificate shall constitute an original additional contractual
obligation of the Company and of the Holder in respect of the Units evidenced
thereby, whether or not the destroyed, lost or stolen Certificate (and the Units
evidenced thereby) shall be at any time enforceable by anyone, and shall be
entitled to all the benefits and be subject to all the obligations of this
Agreement equally and proportionately with any and all other Certificates
delivered hereunder.

     

     

    The
provisions of this Section are exclusive and shall preclude, to the extent
lawful, all other rights and remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates.

     

     

    Section
3.11.          Persons Deemed
Owners.  Prior to due presentment of a Certificate for registration
of transfer, the Company and the Purchase Contract Agent, and any agent of the
Company or the Purchase Contract Agent, may treat the Person in whose name such
Certificate is registered as the owner of the Units evidenced thereby for
purposes of (subject to any applicable record date) any payment or distribution
on the Senior Notes or on the Applicable Ownership Interests (as specified in
clause (ii) of the definition of such term) in the Treasury Portfolio (if any),
as applicable, payment of Contract Adjustment Payments and performance of the
Purchase Contracts and for all other purposes whatsoever in connection with such
Units, whether or not such payment, distribution, or performance shall be
overdue and notwithstanding any notice to the contrary, and neither the Company
nor the Purchase Contract Agent, nor any agent of the Company or the Purchase
Contract Agent, shall be affected by notice to the contrary.

     

     

    Section
3.12.          Cancellation. 
All Certificates surrendered for delivery of shares of Common Stock or Preferred
Stock, as applicable, on or after the Purchase Contract Settlement Date or upon
the transfer of Senior Notes, or for delivery of Senior Notes, the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Treasury Securities,
as the case may be, after the occurrence of a Termination Event or pursuant to a
Cash Settlement, an Early Settlement or a Cash Merger Early Settlement, or upon
the registration of transfer or exchange of a Unit, or a Collateral Substitution
or the recreation of Corporate Units shall, if surrendered to any Person other
than the Purchase Contract Agent, be delivered to the Purchase Contract Agent
along with appropriate written instructions regarding the cancellation thereof
and, if not already cancelled, shall be promptly cancelled by it.  The
Company may at any time deliver to the Purchase Contract Agent for cancellation
any Certificates previously

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     authenticated,
executed and delivered hereunder that the Company may have acquired in any
manner whatsoever, and all Certificates so delivered shall, upon an Issuer
Order, be promptly cancelled by the Purchase Contract Agent.  No
Certificates shall be authenticated, executed on behalf of the Holder and
delivered in lieu of or in exchange for any Certificates cancelled as provided
in this Section, except as expressly permitted by this Agreement.  All
cancelled Certificates held by the Purchase Contract Agent shall be disposed of
in accordance with its customary practices.

     

     

    If the
Company or any Affiliate of the Company shall acquire any Certificate, such
acquisition shall not operate as a cancellation of such Certificate unless and
until such Certificate is delivered to the Purchase Contract Agent cancelled or
for cancellation.

     

     

    Section
3.13.          Creation of Treasury Units
by Substitution of Treasury Securities.  Unless the Treasury
Portfolio has replaced the Senior Notes as a component of the Corporate Units,
and subject to the conditions set forth in this Agreement, a Holder may, at any
time from and after the date of this Agreement and on or prior to 5:00 p.m. (New
York City time) on the seventh Business Day immediately preceding the Purchase
Contract Settlement Date, effect a Collateral Substitution and separate the
Pledged Senior Notes from the related Purchase Contracts in respect of all or a
portion of such Holder’s Corporate Units by substituting for such Pledged Senior
Notes, Treasury Securities or portions thereof in an aggregate principal amount
at maturity equal to the aggregate principal amount of such Pledged Senior
Notes; provided that
Holders may make Collateral Substitutions only in integral multiples of 40
Corporate Units.  To effect such substitution, the Holder
must:

     

     

    
      	
               
      

            	
              (1)

            	
              deposit
      with the Securities Intermediary Treasury Securities having an aggregate
      principal amount at maturity equal to the aggregate principal amount of
      the Senior Notes comprising part of all such Corporate Units;
      and

            

    

     

     

    
      	
               
      

            	
              (2)

            	
              transfer
      the related Corporate Units to the Purchase Contract Agent accompanied by
      a notice to the Purchase Contract Agent, substantially in the form of
      Exhibit C hereto,
      (i) stating that the Holder has deposited the relevant amount of Treasury
      Securities with the Securities Intermediary for credit to the Collateral
      Account and (ii) instructing the Purchase Contract Agent to instruct the
      Collateral Agent to release the Pledged Senior Notes underlying such
      Corporate Units, whereupon the Purchase Contract Agent shall promptly
      provide an instruction to such effect to the Collateral Agent,
      substantially in the form of Exhibit A to the Pledge
      Agreement.

            

    

     

     

    Upon
receipt of the Treasury Securities described in clause (1) above and the
instruction described in clause (2) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to
effect the release of such Pledged Senior Notes from the Pledge and the transfer
of such Senior Notes to the Purchase Contract Agent on behalf of the Holder free
and clear of the Company’s security interest therein.  Upon receipt of such
Senior Notes, the Purchase Contract Agent shall promptly:

     

     

    (i)           cancel
the related Corporate Units;

     

     

    (ii)           transfer
the Senior Notes to the Holder (such Senior Notes shall be tradable as a
separate security, independent of the resulting Treasury Units);
and

     

     

    (iii)           authenticate,
execute on behalf of such Holder and deliver Treasury Units in the form of a
Treasury Units Certificate executed by the Company in accordance with Section 3.03 evidencing the
same number of Purchase Contracts as were evidenced by the cancelled Corporate
Units.

     

     

    Holders
who elect to separate the Senior Notes from the related Purchase Contracts and
to substitute Treasury Securities for such Senior Notes shall be responsible for
any fees or expenses (including, without limitation, fees and expenses payable
to the Collateral Agent for its services as Collateral Agent) in respect of the
substitution, and neither the Company nor the Purchase Contract Agent shall be
responsible for any such fees or expenses.

     

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    If the
Treasury Portfolio has replaced the Senior Notes as a component of the Corporate
Units and subject to the conditions set forth in this Agreement, a Holder may,
at any time on or prior to the second Business Day immediately preceding the
Purchase Contract Settlement Date, substitute Treasury Securities for the
Applicable Ownership Interests in the Treasury Portfolio included in such
Corporate Units, but only in integral multiples of 4,000 Corporate Units. 
In such an event, the Holder shall transfer Treasury Securities having an
aggregate principal amount at maturity equal to the aggregate Stated Amount of
the Purchase Contracts underlying such Corporate Units to the Securities
Intermediary, and the Purchase Contract Agent shall instruct the Collateral
Agent to release the Pledge of and transfer to the Holder the appropriate
Applicable Ownership Interests in the Treasury Portfolio in the manner set forth
above.

     

     

    In the
event a Holder making a Collateral Substitution pursuant to this Section 3.13 fails to deliver
Corporate Units Certificates to the Purchase Contract Agent after depositing
Treasury Securities with the Securities Intermediary, any distributions on the
Senior Notes or Applicable Ownership Interest in the Treasury Portfolio
constituting a part of such Corporate Units shall be held in the name of the
Purchase Contract Agent or its nominee in trust for the benefit of such Holder,
until such Corporate Units are so transferred or the Corporate Units Certificate
is so delivered, as the case may be, or, such Holder provides evidence
satisfactory to the Company and the Purchase Contract Agent that such Corporate
Units Certificate has been destroyed, lost or stolen, together with any
indemnity that may be required by the Purchase Contract Agent and the
Company.

     

     

    Except as
described in Section
5.02 or in this Section
3.13 or in connection with a Cash Settlement, an Early Settlement, a Cash
Merger Early Settlement or a Termination Event, for so long as the Purchase
Contract underlying a Corporate Unit remains in effect, such Corporate Units
shall not be separable into its constituent parts, and the rights and
obligations of the Holder in respect of the Senior Notes or Applicable Ownership
Interests in the Treasury Portfolio, as the case may be, and the Purchase
Contract comprising such Corporate Units may be acquired, and may be transferred
and exchanged, only as a Corporate Unit.

     

     

    Section
3.14.          Recreation of Corporate
Units.  Unless the Treasury Portfolio has replaced the Senior Notes
as a component of the Corporate Units, and subject to the conditions set forth
in this Agreement, a Holder of Treasury Units may recreate Corporate Units at
any time on or prior to 5:00 p.m. (New York City time) on the seventh Business
Day immediately preceding the Purchase Contract Settlement Date; provided that Holders of
Treasury Units may only recreate Corporate Units in integral multiples of 40
Treasury Units.  To recreate Corporate Units, the Holder must:

     

     

    (1)           transfer
to the Securities Intermediary Senior Notes having an aggregate principal amount
equal to the aggregate principal amount at stated maturity of the Pledged
Treasury Securities comprising part of the Treasury Units; and

     

     

    (2)           transfer
the related Treasury Units to the Purchase Contract Agent accompanied by a
notice to the Purchase Contract Agent, substantially in the form of Exhibit C hereto, (i) stating
that the Holder has transferred the relevant amount of Senior Notes to the
Securities Intermediary for deposit in the Collateral Account and (ii)
instructing the Purchase Contract Agent to instruct the Collateral Agent to
release the Pledged Treasury Securities underlying such Treasury Units,
whereupon the Purchase Contract Agent shall promptly provide an instruction to
such effect to the Collateral Agent, substantially in the form of Exhibit C to the Pledge
Agreement.

     

     

    Upon
receipt of the Senior Notes described in clause (1) above and the instruction
described in clause (2) above, in accordance with the terms of the Pledge
Agreement, the Collateral Agent will cause the Securities Intermediary to effect
the release of the Pledged Treasury Securities having a corresponding aggregate
principal amount at maturity from the Pledge and the transfer thereof to the
Purchase Contract Agent on behalf of the Holder free and clear of the Company’s
security interest therein.  Upon receipt of such Treasury Securities, the
Purchase Contract Agent shall promptly:

     

     

    (i)           cancel
the related Treasury Units;

     

     

    (ii)           transfer
the Treasury Securities to the Holder; and

     

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    (iii)           authenticate,
execute on behalf of such Holder and deliver Corporate Units in the form of a
Corporate Units Certificate executed by the Company in accordance with Section 3.03 evidencing the
same number of Purchase Contracts as were evidenced by the cancelled Treasury
Units.

     

     

    Holders
who elect to recreate Corporate Units shall be responsible for any fees or
expenses (including, without limitation, fees and expenses payable to the
Collateral Agent for its services as Collateral Agent) in respect of the
recreation, and neither the Company nor the Purchase Contract Agent shall be
responsible for any such fees or expenses.

     

     

    If the
Treasury Portfolio has replaced the Senior Notes as a component of the Corporate
Units, a Holder of Treasury Units may at any time on or prior to the second
Business Day immediately preceding the Purchase Contract Settlement Date
substitute the Applicable Ownership Interests in the Treasury Portfolio for
Treasury Securities, but only in multiples of 4,000 Treasury Units.

     

     

    In such
an event, the Holder shall transfer the appropriate Applicable Ownership
Interests in the Treasury Portfolio to the Collateral Agent, and the Purchase
Contract Agent shall instruct the Collateral Agent to release the Pledge of and
transfer to the Holder Treasury Securities in the manner set forth
above.

     

     

    Except as
provided in Section 5.02
or in this Section 3.14
or in connection with a Cash Settlement, an Early Settlement, a Cash Merger
Early Settlement or a Termination Event, for so long as the Purchase Contract
underlying a Treasury Unit remains in effect, such Treasury Unit shall not be
separable into its constituent parts and the rights and obligations of the
Holder of such Treasury Unit in respect of the 1/40 of a Treasury Security and
the Purchase Contract comprising such Treasury Unit may be acquired, and may be
transferred and exchanged, only as a Treasury Unit.

     

     

    Section
3.15.          Transfer of Collateral upon
Occurrence of Termination Event.  Upon the occurrence of a
Termination Event and the transfer to the Purchase Contract Agent of the Senior
Notes, the appropriate Applicable Ownership Interests in the Treasury Portfolio
or the Treasury Securities, as the case may be, underlying the Corporate Units
and the Treasury Units, as the case may be, pursuant to the terms of the Pledge
Agreement, the Purchase Contract Agent shall request transfer instructions with
respect to such Senior Notes, the appropriate Applicable Ownership Interests in
the Treasury Portfolio or Treasury Securities, as the case may be, from each
Holder by written request, substantially in the form of Exhibit D hereto, mailed
to such Holder at its address as it appears in the Security
Register.

     

     

    Upon
delivery of a Corporate Units Certificate or Treasury Units Certificate to the
Purchase Contract Agent with such transfer instructions, the Purchase Contract
Agent shall transfer the Senior Notes, the appropriate Applicable Ownership
Interests in the Treasury Portfolio or Treasury Securities, as the case may be,
underlying such Corporate Units or Treasury Units, as the case may be, to such
Holder by appropriate procedures, in accordance with such instructions.  In
the event a Holder of Corporate Units or Treasury Units fails to effect such
transfer or delivery, the Senior Notes, the appropriate Applicable Ownership
Interests in the Treasury Portfolio or Treasury Securities, as the case may be,
underlying such Corporate Units or Treasury Units, as the case may be, and any
distributions thereon, shall be held in the name of the Purchase Contract Agent
or its nominee in trust for the benefit of such Holder, until the earlier to
occur of:

     

     

    (i)           the
transfer of such Corporate Units or Treasury Units or surrender of the Corporate
Units Certificate or Treasury Units Certificate or the receipt by the Company
and the Purchase Contract Agent from such Holder of satisfactory evidence that
such Corporate Units Certificate or Treasury Units Certificate has been
destroyed, lost or stolen, together with any indemnity that may be required by
the Purchase Contract Agent and the Company; and

     

     

     (ii)           the
expiration of the time period specified in the abandoned property laws of the
relevant State in which the Purchase Contract Agent holds such
property.

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    Section
3.16.          No Consent to
Assumption.  Each Holder of a Unit, by acceptance thereof, shall be
deemed expressly to have withheld any consent to the assumption under Section
365 of the Bankruptcy Code or otherwise, of the Purchase Contract by the Company
or its trustee, receiver, liquidator or a person or entity performing similar
functions in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or Federal law providing for
reorganization or liquidation.

     

     

    ARTICLE
4

     

    THE
SENIOR NOTES AND APPLICABLE OWNERSHIP

    INTERESTS
IN THE TREASURY PORTFOLIO

     

     

    Section
4.01.          Interest Payments; Rights to
Interest Payments Preserved.  Any payment on any Senior Note or on
the appropriate Applicable Ownership Interests (as specified in clause (ii) of
the definition of such term) in the Treasury Portfolio, as the case may be,
which is paid on any Payment Date shall, subject to receipt thereof by the
Purchase Contract Agent from the Company (in the case of a Senior Note that is
held in the name of the Purchase Contract Agent) or from the Collateral Agent as
provided by the terms of the Pledge Agreement (in the case of Applicable
Ownership Interests or a Senior Note that is held in the name of the Collateral
Agent), be paid by the Purchase Contract Agent to the Person in whose name the
Corporate Units Certificate (or one or more Predecessor Corporate Units
Certificates) of which such Senior Note or the appropriate Applicable Ownership
Interests in the Treasury Portfolio, as the case may be, forms a part is
registered at the close of business on the Record Date for such Payment
Date.

     

     

    Each
Corporate Units Certificate evidencing Senior Notes or the appropriate
Applicable Ownership Interests in the Treasury Portfolio delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Corporate Units Certificate shall carry the right to accrued and unpaid
interest or distributions, and to accrue interest or distributions, which were
carried by the Senior Notes or the appropriate Applicable Ownership Interests in
the Treasury Portfolio underlying such other Corporate Units
Certificate.

     

     

    In the
case of any Corporate Unit with respect to which (A) Cash Settlement of the
underlying Purchase Contract is properly effected pursuant to Section 5.02(b) or 5.02(c) hereof, (B) Early
Settlement of the underlying Purchase Contract is properly effected pursuant to
Section 5.07 hereof, (C)
Cash Merger Early Settlement of the underlying Purchase Contract is properly
effected pursuant to Section
5.04(b)(ii) hereof or (D) a Collateral Substitution is properly effected
pursuant to Section
3.13, in each case on a date that is after any Record Date and prior to
or on the next succeeding Payment Date, interest on the Senior Notes or
distributions on the appropriate Applicable Ownership Interests in the Treasury
Portfolio, as the case may be, underlying such Corporate Unit otherwise payable
on such Payment Date shall be payable on such Payment Date notwithstanding such
Cash Settlement, Early Settlement, Cash Merger Early Settlement or Collateral
Substitution, and such payment or distributions shall, subject to receipt
thereof by the Purchase Contract Agent, be payable to the Person in whose name
the Corporate Units Certificate (or one or more Predecessor Corporate Units
Certificates) was registered at the close of business on the Record
Date.

     

     

    Except as
otherwise expressly provided in the immediately preceding paragraph, in the case
of any Corporate Units with respect to which Cash Settlement, Early Settlement
or Cash Merger Early Settlement of the underlying Purchase Contract is properly
effected, or with respect to which a Collateral Substitution has been effected,
payments on the related Senior Notes or distributions on the appropriate
Applicable Ownership Interests in the Treasury Portfolio, as the case may be,
that would otherwise be payable or made after the Purchase Contract Settlement
Date, Early Settlement Date, Cash Merger Early Settlement Date or the date of
the Collateral Substitution, as the case may be, shall not be payable hereunder
to the Holder of such Corporate Units; provided, however, that to the extent
that such Holder continues to hold Separate Senior Notes or Applicable Ownership
Interest in the Treasury Portfolio that formerly comprised a part of such
Holder’s Corporate Units, such Holder shall be entitled to receive interest on
such Separate Senior Notes or distributions on the Applicable Ownership
Interests in the Treasury Portfolio.

     

     

    Section
4.02.          Notice and
Voting.  Under the terms of the Pledge Agreement, the Purchase
Contract Agent will be entitled to exercise the voting and any other consensual
rights pertaining to the Pledged Senior Notes, 

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    but only
to the extent instructed in writing by the Holders as described below. 
Upon receipt of notice of any meeting at which holders of Senior Notes are
entitled to vote or upon any solicitation of consents, waivers or proxies of
holders of Senior Notes, the Purchase Contract Agent shall, as soon as
practicable thereafter, mail, first class, postage pre-paid, to the Holders of
Corporate Units a notice:

     

     

    (i)           containing
such information as is contained in the notice or solicitation;

     

     

    (ii)           stating
that each Holder on the record date set by the Purchase Contract Agent therefor
(which, to the extent possible, shall be the same date as the record date for
determining the holders of Senior Notes, as the case may be, entitled to vote)
shall be entitled to instruct the Purchase Contract Agent as to the exercise of
the voting rights pertaining to such Senior Notes underlying their Corporate
Units; and

     

     

    (iii)           stating
the manner in which such instructions may be given.

     

     

    Upon the
written request of the Holders of Corporate Units on such record date received
by the Purchase Contract Agent at least six days prior to such meeting, the
Purchase Contract Agent shall endeavor insofar as practicable to vote or cause
to be voted, in accordance with the instructions set forth in such requests, the
maximum number of Senior Notes, as the case may be, as to which any particular
voting instructions are received.  In the absence of specific instructions
from the Holder of a Corporate Unit, the Purchase Contract Agent shall abstain
from voting the Senior Notes underlying such Corporate Unit.  The Company
hereby agrees, if applicable, to solicit Holders of Corporate Units to timely
instruct the Purchase Contract Agent in order to enable the Purchase Contract
Agent to vote such Senior Notes.

     

     

    The
Holders of Corporate Units and Treasury Units shall have no voting or other
rights in respect of Common Stock or Preferred Stock, as
applicable.

     

     

    Section
4.03.          Special Event
Redemption.  (a) If the Company elects to redeem the Senior Notes on
any Payment Date following the occurrence of a Special Event as permitted by the
Indenture, it shall notify the Collateral Agent in writing that a Special Event
has occurred and that it intends to redeem the Senior Notes on the Special Event
Redemption Date.  On the Special Event Redemption Date, the Collateral
Agent shall surrender the Pledged Senior Notes to the Indenture Trustee against
delivery of an amount equal to the aggregate Redemption Price for such Pledged
Senior Notes.  Thereafter, pursuant to the terms of the Pledge Agreement,
the Collateral Agent shall cause the Securities Intermediary to apply an amount
equal to the aggregate Redemption Amount of such funds to purchase on behalf of
the Holders of Corporate Units the Treasury Portfolio and promptly remit the
remaining portion of such funds to the Purchase Contract Agent for payment to
the Holders of such Corporate Units.

     

     

    (b)           Upon
the occurrence of a Special Event Redemption, (i) the Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio will be substituted as Collateral for the Pledged Senior
Notes and will be held by the Collateral Agent in accordance with the terms of
the Pledge Agreement to secure the obligation of each Holder of a Corporate Unit
to purchase Common Stock or Preferred Stock, as applicable, of the Company under
the Purchase Contract constituting a part of such Corporate Unit, (ii) the
Applicable Ownership Interests (as specified in clause (ii) of the definition of
such term) in the Treasury Portfolio will be transferred to the Purchase
Contract Agent for the benefit of the Holders of such Corporate Units, (iii) the
Holders of Corporate Units and the Collateral Agent shall have such security
interest rights and obligations with respect to such Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio as the Holders of Corporate Units and the Collateral Agent
had in respect of the Senior Notes, as the case may be, subject to the Pledge
thereof as provided in the Pledge Agreement, (iv) any reference herein or in the
Certificates to the Senior Notes shall be deemed to be a reference to such
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio and (v) any reference herein or in the
Certificates to interest on the Senior Notes shall be deemed to be a reference
to corresponding distributions on such Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio.  The Company may cause to be made in any Corporate Units
Certificates thereafter to be issued such change in phraseology and form (but
not in substance) as may be appropriate to reflect 

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

    the
substitution of the Applicable Ownership Interests (as specified in clause (i)
of the definition of such term) in the Treasury Portfolio for Senior Notes as
Collateral.

     

     

    (c)           The
Holders of Separate Senior Notes shall directly receive the Redemption Price for
the Separate Senior Notes in accordance with the terms of the
Indenture.

     

     

    ARTICLE
5

     

    THE
PURCHASE CONTRACTS

     

     

    Section
5.01.          Purchase of Shares of Common
Stock.  (a) Each Purchase Contract shall obligate the Holder of the
related Units to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to $25 (the “Purchase Price”), a number of
newly issued shares of Common Stock (subject to Sections 5.08 and 5.09) equal to the Settlement
Rate (as defined below) unless an Early Settlement, a Cash Merger Early
Settlement or a Termination Event with respect to the Unit of which such
Purchase Contract is a part shall have occurred.  The “Settlement Rate” is equal
to:

     

     

    (i)           if
the Adjusted Applicable Market Value (as defined below) is greater than or equal
to $25.116 (the “Threshold
Appreciation Price”), 0.9954 shares of Common Stock per Purchase Contract
(such number of shares, as adjusted from time to time pursuant to Section 5.04, the “Minimum Share
Number”);

     

     

    (ii)           if
the Adjusted Applicable Market Value is less than the Threshold Appreciation
Price but greater than $20.93 (the “Reference Price”), the number
of shares of Common Stock per Purchase Contract having a value equal to the
Stated Amount divided by the Applicable Market Value; and

     

     

    (iii) if
the Adjusted Applicable Market Value is less than or equal to the Reference
Price, 1.1945 shares of Common Stock per Purchase Contract (such number of
shares, as adjusted from time to time pursuant to Section 5.04, the “Maximum Share
Number”);

     

     

    in each
case rounded upward or downward to the nearest 1/10,000th of a
share.

     

     

    The “Adjusted Applicable Market
Value” means (i) prior to any adjustment pursuant to paragraph (i), (ii),
(iii), (iv), (v), (vi), (vii) or (x) of Section 5.04(a), the
Applicable Market Value, and (ii) at the time of and after any adjustment of the
Fixed Settlement Rate pursuant to paragraph (i), (ii), (iii), (iv), (v), (vi),
(vii) or (x) of Section
5.04(a), the Applicable Market Value multiplied by a fraction of which
the numerator shall be the Fixed Settlement Rate immediately after such
adjustment pursuant to paragraph (i), (ii), (iii), (iv), (v), (vi), (vii) or (x)
of Section 5.04(a) and
the denominator shall be the Fixed Settlement Rate immediately prior to such
adjustment; provided,
however, that if such
adjustment to the Fixed Settlement Rate is required to be made pursuant to the
occurrence of any of the events contemplated by paragraph (i), (ii), (iii),
(iv), (v), (vi), (vii) or (x) of Section 5.04(a) during the
period taken into consideration for determining the Applicable Market Value,
appropriate and customary adjustments shall be made to the Fixed Settlement
Rate.

     

     

    The “Applicable Market Value”
means the average of the Closing Price per share of Common Stock on each of the
20 consecutive Trading Days ending on the third Trading Day immediately
preceding the Purchase Contract Settlement Date.

     

     

    The “Closing Price” per share of
Common Stock on any date of determination means:

     

     

    (i)           the
closing sale price as of the close of the principal trading session (or, if no
closing price is reported, the last reported sale price) per share on the New
York Stock Exchange, Inc. (the “NYSE”) on such
date;

     

    
      
        
        

      

      
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    (ii)           if
the Common Stock is not listed for trading on the NYSE on any such date, the
closing sale price (or, if no closing price is reported, the last reported sale
price) per share as reported in the composite transactions for the principal
United States national or regional securities exchange on which the Common Stock
is so listed;

     

     

    (iii)           if
the Common Stock is not so listed on a United States national or regional
securities exchange, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization; or

     

     

    (iv)           if
the bid price referred to in clause (iii) is not available, the market value of
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained by the Company for purposes of determining the
Closing Price.

     

     

    A “Trading Day” means a day on
which the Common Stock (1) is not suspended from trading on any national or
regional securities exchange or association or over-the-counter market at the
close of business and (2) has traded at least once on the national or regional
securities exchange or association or over-the-counter market that is the
primary market for the trading of the Common Stock.

     

     

    (b)           Each
Holder of a Corporate Unit or a Treasury Unit, by its acceptance of such
Unit:

     

     

    (i)             irrevocably
authorizes the Purchase Contract Agent to enter into and perform the related
Purchase Contract on its behalf as its attorney-in-fact (including, without
limitation, the execution of Certificates on behalf of such
Holder);

     

     

    (ii)             agrees
to be bound by the terms and provisions thereof;

     

     

    (iii)             covenants
and agrees to perform its obligations under such Purchase Contract for so long
as such Holder remains a Holder of a Corporate Unit or a Treasury
Unit;

     

     

    (iv)             consents
to the provisions hereof;

     

     

    (v)             irrevocably
authorizes the Purchase Contract Agent to enter into and perform this Agreement
and the Pledge Agreement on its behalf and in its name as its
attorney-in-fact;

     

     

    (vi)             consents
to, and agrees to be bound by, the Pledge of such Holder’s right, title and
interest in and to the Collateral Account, including the Senior Notes and the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio or the Treasury Securities pursuant to the
Pledge Agreement; and

     

     

    (vii)             for
United States federal, state and local income and franchise tax purposes, agrees
to (A) treat an acquisition of the Corporate Units as an acquisition of the
Senior Notes and Purchase Contracts constituting the Corporate Units and (B)
treat itself as the owner of the applicable interest in the Collateral Account,
including the Senior Notes and the Applicable Ownership Interests in the
Treasury Portfolio (as specified in clause (i) of the definition of such term)
or the Treasury Securities,

     

     

    provided that upon a
Termination Event, the rights of the Holder of such Units under the Purchase
Contract may be enforced without regard to any other rights or
obligations.

     

     

    (c)           Each
Holder of a Corporate Unit or a Treasury Unit, by its acceptance thereof,
further covenants and agrees that to the extent and in the manner provided in
Section 5.02 hereof and
the provisions of the Pledge Agreement, but subject to the terms thereof,
Proceeds of the Senior Notes, the Treasury Securities or the Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as applicable, on the Purchase Contract Settlement
Date, shall be paid by the Collateral Agent to the Company in 

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    satisfaction
of such Holder’s obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such Proceeds.

     

     

    (d)           Upon
registration of transfer of a Certificate, the transferee shall be bound
(without the necessity of any other action on the part of such transferee) by
the terms of this Agreement, the Purchase Contracts underlying such Certificate
and the Pledge Agreement and the transferor shall be released from the
obligations under this Agreement, the Purchase Contracts underlying the
Certificate so transferred and the Pledge Agreement.  The Company covenants
and agrees, and each Holder of a Certificate, by its acceptance thereof,
likewise covenants and agrees, to be bound by the provisions of this
paragraph.

     

     

    Section
5.02.          Remarketing; Payment of
Purchase Price.  (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 Remarketing the Senior Notes.  By
12:00 noon (New York City time) on the Business Day immediately preceding the
Initial Remarketing Date, the Collateral Agent shall notify the Remarketing
Agent of the aggregate principal amount of Pledged Senior Notes, and the
Custodial Agent shall notify the Remarketing Agent of the aggregate principal
amount of Separate Senior Notes (if any) that are to be remarketed pursuant to
clause (i) below.  Upon receipt of such notice from the Collateral Agent
and Custodial Agent, the Remarketing Agent will, on the Initial Remarketing
Date, use its commercially reasonable efforts to remarket (based on the Reset
Rate) such Pledged Senior Notes and Separate Senior Notes on such date at a
price (the “Remarketing
Price”) equal to 100% of the
aggregate principal amount of such Pledged Senior Notes and Separate Senior
Notes being remarketed, as provided in the Remarketing Agreement, for settlement
on the Purchase Contract Settlement Date.

     

     

    (i)           Prior
to 5:00 p.m. (New York City time) on the seventh Business Day immediately
preceding the Purchase Contract Settlement Date, but no earlier than the Payment
Date immediately preceding such date, Holders of Separate Senior Notes may elect
to have their Separate Senior Notes remarketed in all Remarketings under the
Remarketing Agreement by delivering their Separate Senior Notes, along with a
notice of such election, substantially in the form of Exhibit F to the Pledge
Agreement, to the Custodial Agent.  The Custodial Agent shall hold the
Separate Senior Notes in an account separate from the Collateral Account in
which the Pledged Senior Notes (as defined in the Pledge Agreement) shall be
held.  Holders of Separate Senior Notes electing to have their Separate
Senior Notes remarketed will also have the right to withdraw that election by
written notice to the Custodial Agent, substantially in the form of Exhibit G to the Pledge
Agreement, on or prior to 5:00 p.m. (New York City time) on the seventh Business
Day immediately preceding the Purchase Contract Settlement Date (after which
time, such election shall become an irrevocable election to have such Separate
Senior Notes remarketed in all Remarketings), upon which notice the Custodial
Agent shall return such Separate Senior Notes to such Holder.  By 12:00
noon (New York City time) on the sixth Business Day immediately preceding the
Purchase Contract Settlement Date, the Custodial Agent shall notify the
Remarketing Agent of the aggregate principal amount of the Separate Senior Notes
to be remarketed. 

     

     

    (ii)           Not
later than seven calendar days nor more than 15 calendar days prior to the
Initial Remarketing Date, the Company shall notify Holders holding Units and
Separate Senior Notes of the procedures to be followed in the Remarketings,
including in the case of a Failed Final Remarketing the procedures to be
followed to exercise Put Rights.

     

     

    (iii)           The
Company agrees to use its reasonable best efforts to ensure that, if required by
applicable law, a registration statement with regard to the full amount of the
Senior Notes to be remarketed in each Remarketing shall be effective with the
Securities and Exchange Commission in a form that will enable the Remarketing
Agent to rely on it in connection with each such Remarketing.

     

     

    (iv)           The
Company shall cause a notice of a Failed Final Remarketing to be posted (with a
copy of such notice to be provided to the Purchase Contract Agent) on the
Business Day immediately following such Failed Final Remarketing on the
Company’s website.

     

    
      
        
        

      

      
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    If, in
spite of using its commercially reasonable efforts, the Remarketing Agent cannot
remarket such Pledged Senior Notes and such Separate Senior Notes at the
Remarketing Price (other than to the Company) for any reason, or the Remarketing
has not occurred because a condition precedent to the Remarketing has not been
fulfilled (in each case, a “Failed Remarketing”) on the
Initial Remarketing Date, the Remarketing Agent shall, on the Second Remarketing
Date, use its commercially reasonable efforts to remarket such Pledged Senior
Notes and such Separate Senior Notes at the Remarketing Price for settlement on
the Purchase Contract Settlement Date. If, in spite of the Remarketing Agent’s
commercially reasonable efforts, a Failed Remarketing shall have occurred on the
Second Remarketing Date, the Remarketing Agent shall, on the Final Remarketing
Date, use its commercially reasonable efforts to remarket such Pledged Senior
Notes and such Separate Senior Notes at the Remarketing Price for settlement on
the Purchase Contract Settlement Date.

    

    If the
Remarketing Agent is able to remarket such Pledged Senior Notes and such
Separate Senior Notes (if any) at the Remarketing Price in any Remarketing (to
parties other than the Company) in accordance with the Remarketing Agreement (a
“Successful
Remarketing”), the Collateral Agent shall, in accordance with the Pledge
Agreement, cause the Securities Intermediary to transfer the Pledged Senior
Notes upon confirmation of deposit by the Remarketing Agent of the proceeds of
such Successful Remarketing in the Collateral Account.  The proceeds from
the Remarketing remitted to the Collateral Agent shall be applied to satisfy in
full the obligations of such Holders of Corporate Units to pay the Purchase
Price for the shares of Common Stock under the related Purchase Contracts on the
Purchase Contract Settlement Date.  Any proceeds in excess of those
required to pay the Purchase Price will be remitted to the Purchase Contract
Agent for payment to the Holders of the related Corporate Units.  With
respect to Separate Senior Notes, upon a Successful Remarketing, any proceeds of
the Remarketing attributable to the Separate Senior Notes will be remitted to
the Custodial Agent for payment to the holders of Separate Senior Notes and the
Custodial Agent will cause the separate Senior Notes to be transferred to the
Remarketing Agent.

     

    On the
Purchase Contract Settlement Date, the Company shall pay the Remarketing Fee to
the Remarketing Agent in accordance with the Remarketing Agreement.

     

     

    In the
event of a Successful Remarketing, the Maturity Date may be extended to a date
selected by the Company to a date 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 date on which the Reset Rate is set.

     

     

    If, in
spite of the Remarketing Agent using its commercially reasonable efforts, the
Remarketing on the Final Remarketing Date is a Failed Remarketing (a “Failed Final Remarketing”), as
of the Purchase Contract Settlement Date, each Holder of any Pledged Senior
Notes, unless such Holder has elected Cash Settlement and delivered cash in
accordance with Section
5.02(c), shall be deemed to have exercised such Holder’s Put Right with
respect to such Senior Notes and to have elected to have a portion of the
Proceeds of the Put Right set-off against such Holder’s obligation to pay the
aggregate Purchase Price for the shares of Common Stock or Preferred Stock, as
applicable, to be issued under the related Purchase Contracts in full
satisfaction of such Holders’ obligations under such Purchase Contracts. 
Following such set-off, each such Holder’s obligations to pay the Purchase Price
for the shares of Common Stock or Preferred Stock, as applicable, will be deemed
to be satisfied in full, and the Collateral Agent shall cause the Securities
Intermediary to release the Pledged Senior Notes from the Collateral Account and
shall promptly transfer the Pledged Senior Notes to the Company. 
Thereafter, the Collateral Agent shall promptly remit the remaining portion of
the Proceeds of the Holder’s exercise of the Put Right in excess of the
aggregate Purchase Price for the shares of Common Stock or Preferred Stock, as
applicable, to be issued under such Purchase Contracts to the Purchase Contract
Agent for payment to the Holder of the Corporate Units to which such Senior
Notes relate.

     

     

    As soon
as practicable after 5:00 p.m. (New York city time) on the Business Day
preceding the Purchase Contract Settlement Date, the Collateral Agent, based on
cash payment received by the Collateral Agent pursuant to Section 5.02(c)(ii) hereof,
shall promptly notify the Purchase Contract Agent and the Indenture Trustee of
the aggregate principal amount of Senior Notes pursuant to which a Put Right has
been automatically exercised pursuant to this Section 5.02(a).

     

     

    
      
        
        

      

      
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    (b)           (i)
Unless a Special Event Redemption, an Early Settlement or a Cash Merger Early
Settlement has occurred prior to the seventh Business Day immediately preceding
the Purchase Contract Settlement Date, each Holder of Corporate Units shall have
the right to satisfy such Holder’s obligations under the Purchase Contract on
the Purchase Contract Settlement Date in cash by notifying the Purchase Contract
Agent by use of a notice in substantially the form of Exhibit E hereto of its
intention to pay in cash (“Cash
Settlement”) on or prior to 5:00 p.m. (New York City time) on the seventh
Business Day immediately preceding the Purchase Contract Settlement Date. 
Promptly following 5:00 p.m. (New York City time) on the seventh Business Day
immediately preceding the Purchase Contract Settlement Date, the Purchase
Contract Agent shall notify the Collateral Agent and the Indenture Trustee by
written notice substantially in the form of Exhibit F to this Agreement of
the receipt of such notices from Holders intending to make a Cash
Settlement.

     

     

    (ii)           A
Holder of a Corporate Unit who has so notified the Purchase Contract Agent of
its intention to effect a Cash Settlement shall pay the Purchase Price to the
Collateral Agent for deposit in the Collateral Account on or prior to 11:00 a.m.
(New York City time) on the sixth Business Day immediately preceding the
Purchase Contract Settlement Date, in lawful money of the United States by
certified or cashiers’ check or wire transfer of immediately available funds
payable to or upon the order of the Securities Intermediary.  Any cash so
received shall be invested promptly by the Securities Intermediary in Permitted
Investments and paid to the Company on the Purchase Contract Settlement Date in
settlement of the Purchase Contracts in accordance with the terms of this
Agreement and the Pledge Agreement.  Any funds received by the Securities
Intermediary in respect of the investment earnings from such Permitted
Investments in excess of the Purchase Price for the shares of Common Stock or
Preferred Stock, as applicable, to be purchased by such Holder shall be
distributed to the Purchase Contract Agent when received for payment to the
Holder.

     

     

    (iii)           If
a Holder of a Corporate Unit does not notify the Purchase Contract Agent of its
intention to make a Cash Settlement in accordance with Section 5.02(b)(i) above, or
does notify the Purchase Contract Agent in accordance with Section 5.02(b)(i) above but
fails to make such payment as required by Section 5.02(b)(ii) above,
such Holder shall be deemed to have consented to the disposition of the Pledged
Senior Notes pursuant to any Remarketing as described in paragraph Section 5.02(a)
above.

     

     

    (iv)           By
12:00 noon (New York City time) on the sixth Business Day preceding the Purchase
Contract Settlement Date, the Collateral Agent, based on cash payments received
by the Collateral Agent pursuant to Section 5.02(b)(ii) hereof,
shall promptly notify the Purchase Contract Agent and the Indenture Trustee of
the aggregate principal amount of Senior Notes to be tendered for remarketing in
the Remarketings in a notice pursuant to the terms of the Pledge
Agreement.

     

     

    (c)           (i)           Each
Holder of a Corporate Unit who intends to effect a Cash Settlement of the
underlying Purchase Contract following a Failed Final Remarketing shall so
notify the Purchase Contract Agent by use of a notice in substantially the form
of Exhibit G hereto
prior to 5:00 p.m. (New York City time) on the second Business Day immediately
preceding the Purchase Contract Settlement Date.  Promptly following 5:00
p.m. (New York City time) on the second Business Day immediately preceding the
Purchase Contract Settlement Date, the Purchase Contract Agent shall notify the
Collateral Agent and the Indenture Trustee of the receipt of such notices from
Holders intending to make a Cash Settlement.

     

     

    (ii)           A
Holder of a Corporate Unit who has so notified the Purchase Contract Agent of
its intention to effect a Cash Settlement shall pay the Purchase Price to the
Collateral Agent for deposit in the Collateral Account prior to 5:00 p.m. (New
York City time) on the Business Day immediately preceding the Purchase Contract
Settlement Date, in lawful money of the United States by certified or cashiers'
check or wire transfer, in each case in immediately available funds payable to
or upon the order of the Securities Intermediary.  Any cash so received
shall be invested promptly by the Securities Intermediary in Permitted
Investments and paid to the Company on the Purchase Contract Settlement Date in
settlement of the Purchase Contracts in accordance with the terms of this
Agreement and the Pledge Agreement.  Any funds received by the Securities
Intermediary in respect of the investment earnings from such Permitted
Investments in excess of the Purchase Price for the shares of Common Stock to be

     

    
      
        
        

      

      
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        purchased by
such Holder shall be distributed to the Purchase Contract Agent when received
for payment to the Holder.

     

     

    (iii)           If
a Holder of a Corporate Unit does not notify the Purchase Contract Agent of its
intention to make a Cash Settlement in accordance with Section 5.02(b)(i) or 5.02(c)(i) above, or does
notify the Purchase Contract Agent in accordance with Section 5.02(b)(i) or 5.02(c)(i) above but fails to
make such payment as required by Section 5.02(b)(ii) or 5.02(c)(ii) above,
respectively, such Holder shall be deemed to have automatically exercised such
Holder's Put Right following a Failed Final Remarketing as described in Section 5.02(a)
above.

     

     

    (d)           [Intentionally
omitted].

     

     

    (e)           [Intentionally
omitted.]

     

     

    (f)           [Intentionally
omitted.]

     

     

    (g)           Any
distribution to Holders of any payments described above shall be payable at the
office of the Purchase Contract Agent in New York City maintained for that
purpose or, at the option of the Holder, by check mailed to the address of the
Person entitled thereto at such address as it appears on the Security
Register.

     

     

    (h)           Upon
Cash Settlement of any Purchase Contract:

     

     

    (i)           the
Collateral Agent will in accordance with the terms of the Pledge Agreement cause
the Pledged Senior Notes or, the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, underlying the relevant Units to be released from
the Pledge, free and clear of any security interest of the Company, and
transferred to the Purchase Contract Agent for delivery to the Holder thereof or
its designee as soon as reasonably practicable; and

     

     

    (ii)           subject
to the receipt thereof, the Purchase Contract Agent shall, by appropriate
procedures, in accordance with written instructions provided by the Holder
thereof, transfer such Senior Notes, or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, as the case may be (or, if no such instructions are given to
the Purchase Contract Agent by the Holder, the Purchase Contract Agent shall
hold such Senior Notes, or the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, and any interest payment thereon, in the name of
the Purchase Contract Agent or its nominee in trust for the benefit of such
Holder until the expiration of the time period specified in the abandoned
property laws of the relevant state where such property is held).

     

     

    (i)           The
obligations of the Holders to pay the Purchase Price are non-recourse
obligations and, except to the extent satisfied by Early Settlement, Cash Merger
Early Settlement or Cash Settlement, are payable solely out of the proceeds of
any Collateral pledged to secure the obligations of the Holders, and in no event
will Holders be liable for any deficiency between the Proceeds of the
disposition of Collateral and the Purchase Price.

     

     

    (j)           The
Company shall not be obligated to issue any shares of Common Stock or Preferred
Stock, as applicable, in respect of a Purchase Contract or deliver any
certificates thereof to the Holder of the related Units unless the Company shall
have received payment for the Common Stock or Preferred Stock, as applicable, to
be purchased thereunder in the manner herein set forth.

     

     

    Section
5.03.          Issuance of Shares of Common
Stock.  (a) Unless a Termination Event, an Early Settlement or a
Cash Merger Early Settlement shall have occurred, subject to Sections 5.04(b)(ii) and 5.08, on the Purchase Contract
Settlement Date upon receipt of the aggregate Purchase Price payable on all
Outstanding Units, 

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

    the
Company shall issue and deposit with the Purchase Contract Agent, for the
benefit of the Holders of the Outstanding Units, one or more certificates
representing newly issued shares of Common Stock registered in the name of the
Purchase Contract Agent (or its nominee) as custodian for the Holders (such
certificates for shares of Common Stock, together with any dividends or
distributions for which a record date and payment date for such dividend or
distribution has occurred after the Purchase Contract Settlement Date, being
hereinafter referred to as the “Purchase Contract Settlement
Fund”) to which the Holders are entitled hereunder.

     

     

    Subject
to the foregoing, upon surrender of a Certificate to the Purchase Contract Agent
on or after the Purchase Contract Settlement Date, Early Settlement Date or Cash
Merger Early Settlement Date, as the case may be, together with settlement
instructions thereon duly completed and executed, the Holder of such Certificate
shall be entitled to receive forthwith in exchange therefor a certificate
representing that number of newly issued whole shares of Common Stock which such
Holder is entitled to receive pursuant to the provisions of this Article 5 (after taking into
account all Units then held by such Holder), together with cash in lieu of
fractional shares as provided in Section 5.09 and any dividends
or distributions with respect to such shares constituting part of the Purchase
Contract Settlement Fund, but without any interest thereon, and the Certificate
so surrendered shall forthwith be cancelled.  Such shares shall be
registered in the name of the Holder or the Holder’s designee as specified in
the settlement instructions provided by the Holder to the Purchase Contract
Agent.  If any shares of Common Stock issued in respect of a Purchase
Contract are to be registered to a Person other than the Person in whose name
the Certificate evidencing such Purchase Contract is registered, no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of the Certificate evidencing such
Purchase Contract or has established to the satisfaction of the Company that
such tax either has been paid or is not payable.

     

     

    (b)           In
the event that a Holder should have made an election pursuant to Section 5.08, this Section 5.03 shall as to such
Holder apply to shares of Preferred Stock in lieu of shares of Common
Stock.

     

     

    Section
5.04.          Adjustment of each Fixed
Settlement Rate.  (a)  Adjustments for Dividends,
Distributions, Stock Splits, Etc.

     

     

    (i)           In
case the Company shall pay or make a dividend or other distribution on Common
Stock in Common Stock, each Fixed Settlement Rate in effect at the close of
business on the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased by dividing each
Fixed Settlement Rate by a fraction of which:

     

     

    (A)           the
numerator shall be the number of shares of Common Stock outstanding at the close
of business on the date fixed for such determination; and

     

     

    (B)       
the denominator shall be the sum of the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
and the total number of shares constituting such dividend or other
distribution,

     

     

    such
increase in each Fixed Settlement Rate to become effective immediately at the
opening of business on the Business Day following the date fixed for such
determination.  For the purposes of this paragraph (i), the number of
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Company but shall include any shares issuable in respect of
any scrip certificates issued in lieu of fractions of shares of Common
Stock.  The Company agrees that it shall not pay any dividend or make any
distribution on shares of Common Stock held in the treasury of the
Company.

     

     

    (ii)           In
case the Company shall issue rights, warrants or options, other than pursuant to
any dividend reinvestment plans or share purchase plans (that are not available
on an equivalent basis to holders of Units upon settlement of the Purchase
Contracts), to all holders of its Common Stock entitling them, for a period
expiring within 45 days after the record date for the determination of
shareholders entitled to receive such rights, warrants or options, to subscribe
for or purchase shares of Common Stock at a price per share less than the
Current Market Price per share of Common Stock on the date of 

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

    announcement
of such issuance, each Fixed Settlement Rate in effect at the close of business
on the date of such announcement shall be increased by dividing such Fixed
Settlement Rate by a fraction of which:

     

     

    (A)           the
numerator shall be the number of shares of Common Stock outstanding at the close
of business on the date of such announcement plus the number of shares of Common
Stock that the aggregate offering price of the total number of shares of Common
Stock so offered for subscription or purchase in the manner described in this
Section 5.04(a)(ii)
would purchase at the Current Market Price on the date of such announcement;
and

     

     

    (B)           the
denominator shall be the number of shares of Common Stock outstanding at the
close of business on the date of such announcement plus the number of shares of
Common Stock so offered for subscription or purchase,

     

     

    such
increase in each Fixed Settlement Rate to become effective immediately after the
opening of business on the Business Day following the date of such
announcement.  The Company agrees that it shall notify the Purchase
Contract Agent if any issuance of such rights, warrants or options is cancelled
or not completed following the announcement thereof and each Fixed Settlement
Rate shall thereupon immediately be readjusted to the Fixed Settlement Rate that
would then be in effect if such issuance had not been declared. For the purposes
of this clause (ii), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but
shall include any shares issuable in respect of any scrip certificates issued in
lieu of fractions of shares of Common Stock.  The Company agrees that it
shall not issue any such rights, warrants or options in respect of shares of
Common Stock held in the treasury of the Company.

     

     

    (iii)           In
case outstanding shares of Common Stock shall be subdivided or split into a
greater number of shares of Common Stock, each Fixed Settlement Rate in effect
at the close of business on the day preceding the day upon which such
subdivision or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, each Fixed Settlement Rate in
effect at the close of business on the day preceding the day upon which such
combination becomes effective shall be proportionately decreased, such increase
or decrease, as the case may be, to become effective immediately at the opening
of business on the Business Day following the day upon which such subdivision,
split or combination becomes effective.

     

     

    (iv)           (w) 
In case the Company shall, by dividend or otherwise, distribute to all holders
of its Common Stock evidences of its indebtedness or assets (including shares of
capital stock, securities, cash and property but excluding any rights, warrants
or options referred to in Section 5.04(a)(ii) above, or
any dividend or distribution paid exclusively in cash and any dividend or
distribution referred to in Section 5.04(a)(i) above) (any
of the foregoing hereinafter in this Section 5.04(a)(iv) called the
“Distributed Property”),
each Fixed Settlement Rate in effect at the close of business on the date fixed
for the determination of shareholders entitled to receive such distribution
shall be adjusted by dividing each Fixed Settlement Rate by a fraction of
which:

     

     

    (A)           the
numerator shall be the Current Market Price per share of Common Stock on the
date fixed for such determination less the then fair market value of the portion
of the assets or evidences of indebtedness so distributed applicable to one
share of Common Stock (as determined by the Board of Directors, whose
determination shall be conclusive and the basis for which shall be described in
a Board Resolution); and

     

     

    (B)           the
denominator shall be such Current Market Price per share of Common
Stock,

     

     

    such
adjustment to each Fixed Settlement Rate to become effective at the opening of
business on the Business Day following the date fixed for the determination of
shareholders entitled to receive such 

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

    distribution; provided that if the fair
market value of the Distributed Property applicable to one share of Common Stock
is equal to or greater than the Current Market Price on the date fixed for the
determination of stockholders entitled to receive such distribution, in lieu of
the foregoing adjustment, adequate provision shall be made so that each Holder
shall have the right to receive upon settlement the amount of Distributed
Property such Holder would have received had such Holder settled each Purchase
Contract on the date fixed for such determination as if the Purchase Contract
Settlement Date were such date fixed for such determination.  In any case
in which this Section
5.04(a)(iv) is applicable, Section 5.04(a)(ii) shall not
be applicable.  In the event that such dividend or distribution is not so
paid or made, each Fixed Settlement Rate shall again be adjusted to be the Fixed
Settlement Rate that would then be in effect if such dividend or distribution
had not been declared.

     

     

    (x)  Notwithstanding
the foregoing, if the Distributed Property distributed by the Company to all
holders of its Common Stock consist of capital stock of, or similar equity
interests in, a Subsidiary or other business unit of the Company, clause (w)
above shall not apply and instead each Fixed Settlement Rate shall be increased
so that each Fixed Settlement Rate shall be equal to the rate determined by
multiplying each such rate in effect immediately prior to the close of business
on the record date with respect to such distribution by a fraction of
which,

     

     

    (A)             the
numerator shall be the sum of (A) the average of the Closing Prices of the
Common Stock for the ten (10) consecutive Trading Days commencing on and
including the fifth Trading Day after the date on which “ex-dividend trading”
commences for such dividend or distribution on the NYSE, the Nasdaq Stock Market
or such other national or regional exchange or market on which such securities
are then listed or quoted (the “Ex-Dividend Date”) plus (B)
the average Closing Prices of the securities distributed in respect of each
share of Common Stock for the ten (10) consecutive Trading Days commencing on
and including the fifth Trading Day after the Ex-Dividend Date; and

     

     

    (B)   
the denominator shall be the average of the Closing Prices of the Common Stock
for the ten (10) consecutive Trading Days commencing on and including the fifth
Trading Day after the Ex-Dividend Date,

     

     

    such
adjustment to each Fixed Settlement Rate to become effective immediately prior
to the opening of business on the Business Day following the record date with
respect to such distribution.  In any case in which this paragraph (x) is
applicable, Section
5.04(a)(i), Section
5.04(a)(ii) and paragraph (w) of this Section 5.04(a)(iv) shall not
be applicable.

     

     

    (y)  Notwithstanding
anything to the contrary contained in this Section 5.04(a), rights or
warrants distributed by the Company to all holders of Common Stock entitling the
holders thereof to subscribe for or purchase shares of the Company’s capital
stock (either initially or under certain circumstances), which rights, options
or warrants, until the occurrence of a specified event or events (“Trigger Event”) (i) are deemed
to be transferred with such shares of Common Stock; (ii) are not exercisable;
and (iii) are also issued in respect of future issuances of Common Stock, shall
be deemed not to have been distributed for purposes of this Section 5.04(a) (and no
adjustment to each Fixed Settlement Rate under this Section 5.04(a) will be
required) until the occurrence of the earliest Trigger Event, whereupon such
rights, options and warrants shall be deemed to have been distributed and an
appropriate adjustment (if any is required) to each Fixed Settlement Rate shall
be made under this Section
5.04(a)(iv).  In addition, in the event of any distribution of
rights, options or warrants, or any Trigger Event with respect thereto that was
counted for purposes of calculating a distribution amount for which an
adjustment to each Fixed Settlement Rate under this Section 5.04(a) was made, (1)
in the case of any such rights, options or warrants that shall all have been
redeemed or repurchased without exercise by any holders thereof, each Fixed
Settlement Rate shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder or holders of Common Stock with respect to such
rights, options or warrants (assuming such holder had retained such rights,
options or warrants), made to all holders of Common Stock as of the date of such
redemption or repurchase, and (2) in the case of such 

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        
rights,
options or warrants that shall have expired or been terminated without exercise
by any holders thereof, each Fixed Settlement Rate shall be readjusted as if
such rights, options and warrants had not been issued.

    

     

     

    (z)                 For
purposes of this Section
5.04(a)(iv) and Section
5.04(a)(i) and Section
5.04(a)(ii), any dividend or distribution to which this Section 5.02(a)(iv) is
applicable that also includes shares of Common Stock, or rights, options or
warrants to subscribe for or purchase shares of Common Stock (or both), shall be
deemed instead to be (1) a dividend or distribution of the evidences of
indebtedness, assets or shares of capital stock other than such shares of Common
Stock or rights, options or warrants (and any Fixed Settlement Rate adjustment
required by this Section
5.04(a)(iv) with respect to such dividend or distribution shall then be
made) immediately followed by (2) a dividend or distribution of such shares of
Common Stock or such rights, options or warrants (and any further Fixed
Settlement Rate adjustment required by Section 5.04(a)(i) and Section 5.04(a)(ii) with
respect to such dividend or distribution shall then be made), except (A) the
record date of such dividend or distribution shall be deemed to be “the date
fixed for the determination of shareholders entitled to receive such dividend or
other distribution”, “the date fixed for the determination of shareholders
entitled to receive such rights, options or warrants” and “the date fixed for
such determination” within the meaning of Section 5.04(a)(i) and Section 5.04(a)(ii) and (B)
any shares of Common Stock included in such dividend or distribution shall not
be deemed “outstanding at the close of business on the date fixed for the
determination of shareholders entitled to receive such dividend or other
distribution” or “outstanding at the close of business on the date fixed for
such determination” within the meaning of Section
5.04(a)(i).

     

     

    (v)           In
case the Company or any of its subsidiaries shall make any dividend or
distribution consisting exclusively of cash to all holders of outstanding shares
of Common Stock (excluding any cash dividend or distribution on Common Stock to
the extent that the aggregate cash dividend per share of Common Stock in any
fiscal quarter does not exceed $0.40 (the “Dividend Threshold Amount”),
then each Fixed Settlement Rate will be adjusted by dividing each Fixed
Settlement Rate in effect immediately prior to the close of business on the
record date with respect to such dividend or distribution by a fraction of
which,

     

     

    (A)           the
numerator is the Current Market Price on the date fixed for the determination of
stockholders entitled to receive such distribution, less the amount per share of
Common Stock of such dividend or distribution in excess of the Dividend
Threshold Amount; and

     

     

    (B)           the denominator is such Current Market
Price, such adjustment to
each Fixed Settlement Rate to be effective immediately prior to the opening of
business on the Business Day following the date fixed for the determination of
stockholders entitled to receive such distribution; provided that if an adjustment is required to
be made under this clause as a result of a distribution that is not a regular
quarterly dividend, the Dividend Threshold Amount will be deemed to be zero;
and
provided further that if
the portion of the cash so distributed applicable to one share of Common Stock
is equal to or greater than the Current Market Price on the date fixed for the
determination of stockholders entitled to receive such distribution, in lieu of
the foregoing adjustment, adequate provision shall be made so that each Holder
shall have the right to receive upon settlement the amount of cash such Holder
would have received had such Holder settled each Purchase Contract on the date
fixed for such determination as if the Purchase Contract Settlement Date were
such date fixed for such determination.  The Dividend Threshold Amount is
subject to adjustment from time to time in a manner inversely proportional to
any adjustment made to each Fixed Settlement Rate under this Section
5.04; provided that no
adjustment will be made to the Dividend Threshold Amount for any adjustment made
pursuant to this clause (v).

     

     

    (vi)           In
case a tender or exchange offer made by the Company or any subsidiary of the
Company for all or any portion of the Common Stock shall expire and such tender
or exchange offer (as amended upon the expiration thereof) shall require the
payment to stockholders of consideration per share of Common Stock having a fair
market value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a resolution of the Board of Directors) that as
of the last 

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

    time (the
“Expiration Time”)
tenders or exchanges may be made pursuant to such tender or exchange offer (as
it may be amended) exceeds the Closing Price of a share of Common Stock on the
Trading Day next succeeding the Expiration Time, each Fixed Settlement Rate
shall be increased so that the same shall equal the rate determined by dividing
such Fixed Settlement Rate in effect immediately prior to the Expiration Time by
a fraction,

     

     

    (A)           the
numerator of which shall be equal to the product of (x) the Current Market Price
of a share of Common Stock as of the Expiration Time and (y) the number of
shares of Common Stock outstanding (including any shares accepted in terms of
the tender or exchange offer, such shares being referred to as the “Purchased Shares”) at the
Expiration Time less the fair market value (determined by the Board of Directors
as aforesaid) of the aggregate consideration payable to stockholders for all
Purchased Shares, and

     

     

    (B)           the
denominator of which shall be the product of (x) the number of shares of Common
Stock outstanding at the Expiration Time less any Purchased Shares and (y) the
Current Market Price of a share of Common Stock at the Expiration
Time,

     

     

    such
adjustment to become effective immediately prior to the opening of business on
the day following the Expiration Time.  If the Company is obligated to
purchase shares pursuant to any such tender or exchange offer, but the Company
is permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, each Fixed Settlement Rate shall again be
adjusted to be the Fixed Settlement Rate that would then be in effect if such
tender or exchange offer had not been made.

     

     

    (vii)           The
reclassification of Common Stock into securities including securities other than
Common Stock (other than any reclassification upon a Reorganization Event to
which Section 5.04(b)
applies) shall be deemed to involve:

     

     

    (A)           a
distribution of such securities other than Common Stock to all holders of Common
Stock (and the effective date of such reclassification shall be deemed to be
“the date fixed for the determination of shareholders entitled to receive such
distribution” and the “date fixed for such determination” within the meaning of
paragraph (iv) of this Section
5.04(a)); and

     

     

    (B)           a
subdivision, split or combination, as the case may be, of the number of shares
of Common Stock outstanding immediately prior to such reclassification into the
number of shares of Common Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed to be “the day upon
which such subdivision or split becomes effective” or “the day upon which such
combination becomes effective”, as the case may be, and “the day upon which such
subdivision, split or combination becomes effective” within the meaning of this
Section
5.04(a)(vii)).

     

     

    (viii)           All
adjustments to each Fixed Settlement Rate shall be calculated to the nearest
1/10,000th of a share of Common Stock (or if there is not a nearest 1/10,000th
of a share, to the next lower 1/10,000th of a share).  If any adjustments
are made to each Fixed Settlement Rate pursuant to this Section 5.04(a), an adjustment
shall also be made to the Applicable Market Value solely to determine which of
clauses (i), (ii) or (iii) of the definition of Settlement Rate in Section 5.01(a) will apply on
the Purchase Contract Settlement Date or any Cash Merger Early Settlement
Date.  Such adjustment shall be made by multiplying the Applicable Market
Value by the Adjustment Factor.  The “Adjustment Factor” means,
initially, a fraction the numerator of which shall be the Maximum Settlement
Rate immediately after the first adjustment to each Fixed Settlement Rate
pursuant to this Section
5.04(a) and the denominator of which shall be the Maximum Settlement Rate
immediately prior to such adjustment.  Each time an adjustment is required
to be made to each Fixed Settlement Rate pursuant to this Section 5.04(a), the
Adjustment Factor shall be multiplied by a fraction the numerator of which shall
be the Maximum Settlement Rate immediately after such adjustment to each Fixed
Settlement Rate pursuant to this Section 5.04(a) and the
denominator of which shall be the Maximum Settlement Rate immediately prior to
such 

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

    adjustment. 
Notwithstanding the foregoing, if any adjustment to each Fixed Settlement Rate
is required to be made pursuant to the occurrence of any of the events
contemplated by this Section
5.04(a) during the period taken into consideration for determining the
Applicable Market Value, the 20 individual Closing Prices used to determine the
Applicable Market Value shall be adjusted rather than the Applicable Market
Value and the Applicable Market Value shall be determined by (A) multiplying the
Closing Prices for Trading Days prior to such adjustment to each Fixed
Settlement Rate by the Adjustment Factor in effect prior to such adjustment, (B)
multiplying the Closing Prices for Trading Days following such adjustment by the
Adjustment Factor reflecting such adjustment, and (C) dividing the sum of all
such adjusted Closing Prices by 20.

     

     

    (ix)           The
Company may, but shall not be required to, make such increases in each Fixed
Settlement Rate, in addition to those required by this Section 5.04(a), as the Board
of Directors considers to be advisable.  The Company may make such a
discretionary adjustment only if it makes the same proportionate adjustment to
each Fixed Settlement Rate.  No adjustment in the Fixed Settlement Rate
shall be required unless such adjustment would require an increase or decrease
of at least one percent; provided, however, that any
such minor adjustments that are not required to be made shall be carried forward
and taken into account in any subsequent adjustment, and provided further that any
such adjustment of less than one percent that has not been made shall be made
(x) upon the end of the Company’s fiscal year and (y) upon the Purchase Contract
Settlement Date.

     

     

    (x)           If
the Company hereafter adopts any stockholder rights plan involving the issuance
of preference share purchase rights or other similar rights (the “Rights”) to all holders of the
Common Stock, a Holder shall be entitled to receive upon settlement of any
Purchase Contract, in addition to the shares of Common Stock issuable upon
settlement of such Purchase Contract, the related Rights for the Common Stock,
unless such Rights under the future stockholder rights plan have separated from
the Common Stock at the time of conversion, in which case each Fixed Settlement
Rate shall be adjusted as provided in Section 5.04(a)(iv) on the
date such Rights separate from the Common Stock.

     

     

    (b)           Adjustment for
Consolidation, Merger or Other Reorganization Event.

     

     

    (i)           In
the event of:

     

     

    (A)           any
consolidation or merger of the Company with or into another Person (other than a
merger or consolidation in which the Company is the continuing corporation and
in which the shares of Common Stock outstanding immediately prior to the merger
or consolidation are not exchanged for cash, securities or other property of the
Company or another corporation);

     

     

    (B)           any
sale, transfer, lease or conveyance to another Person of the property of the
Company as an entirety or substantially as an entirety;

     

     

    (C)           any
statutory share exchange of the Company with another Person (other than in
connection with a merger or acquisition); or

     

     

    (D)           any
liquidation, dissolution or termination of the Company other than as a result of
or after the occurrence of a Termination Event (any event described in clauses
(A), (B), (C) and (D), a “Reorganization
Event”),

     

     

    each
Holder will receive, in lieu of shares of Common Stock, on the Purchase Contract
Settlement Date or any Early Settlement Date with respect to each Purchase
Contract forming a part thereof, the kind and amount of securities, cash and
other property receivable upon such Reorganization Event (without any interest
thereon, and without any right to dividends or distribution thereon if such
dividends or distributions have a record date that is prior to the Purchase
Contract Settlement Date) by a Holder of one share of Common Stock (the “Exchange Property”),
multiplied by the applicable Settlement Rate.  The kind and amount of
Exchange Property will be determined 

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

    assuming
such holder of one Share of Common Stock is not a Person with which the Company
consolidated or into which the Company merged or which merged into the Company
or to which such sale or transfer was made, as the case may be (any such Person,
a “Constituent Person”),
or an Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-affiliates and such Holder failed to exercise its rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such Reorganization Event (provided that if the kind or
amount of securities, cash and other property receivable upon such
Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by a Person other than a
Constituent Person or an Affiliate thereof and in respect of which rights of
election shall not have been exercised (“non-electing share”), then for
the purpose of this Section
5.04(b)(i) the kind and amount of securities, cash and other property
receivable upon such Reorganization Event shall be deemed to be the kind and
amount so receivable per share by a plurality of the non-electing
shares).

     

     

    For
purposes of determining the applicable Settlement Rate under this Section 5.04(b)(i) and Section 5.04(b)(ii), the term
“Applicable Market
Value” shall be deemed to refer to the “Applicable Market Value” of the
Exchange Property, and such value shall be determined (A) with respect to any
publicly traded securities that compose all or part of the Exchange Property,
based on the Closing Price of such securities, (B) in the case of any cash that
composes all or part of the Exchange Property, based on the amount of such cash
and (C) in the case of any other property that composes all or part of the
Exchange Property, based on the value of such property, as determined by a
nationally recognized independent investment banking firm retained by the
Company for this purpose;
provided that prior to the separation of the Rights or any similar
stockholder rights from the Common Stock, such Rights or similar stockholder
rights shall be deemed to have no value.  For the purposes of this
paragraph only, the term “Closing Price” shall be
deemed to refer to the closing sale price, last quoted bid price or mid-point of
the last bid and ask prices, as the case may be, of any publicly traded
securities that comprise all or part of the Exchange Property and the term “Trading Day” shall be deemed
to refer to any publicly traded securities that comprise all or part of the
Exchange Property.

     

     

    In the
event of such a Reorganization Event, the Person formed by such consolidation,
merger or exchange or the Person that acquires the assets of the Company or, in
the event of a liquidation, dissolution or termination of the Company, the
Company or a liquidating trust created in connection therewith, shall execute
and deliver to the Purchase Contract Agent an agreement supplemental hereto
providing that each Holder of an Outstanding Unit shall have the rights provided
by this Section
5.04(b)(i).  Such supplemental agreement shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental agreement, shall be, in the sole judgment of the parties executing
such agreement, as nearly equivalent as may be practicable to the adjustments
provided for in this Section
5.04. The above provisions of this Section 5.04 shall similarly
apply to successive Reorganization Events.

     

     

    (ii)           Prior
to the Purchase Contract Settlement Date, in the event of a consolidation or
merger of the Company with or into another Person, or any merger of another
Person into the Company (other than a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock), in each case in which 30% or more of the total consideration paid
to the Company’s shareholders consists of cash or cash equivalents (a “Cash Merger”), then a Holder
of a Unit may settle (“Cash
Merger Early Settlement”) its Purchase Contract, upon the conditions set
forth below, at the Settlement Rate in effect immediately prior to the closing
of the Cash Merger;
provided that no Cash Merger Early Settlement will be permitted pursuant
to this Section
5.04(b)(ii) unless, at the time such Cash Merger Early Settlement is
effected, there is an effective Registration Statement with respect to any
securities to be issued and delivered in connection with such Cash Merger Early
Settlement, if such a Registration Statement is required (in the view of
counsel, which need not be in the form of a written opinion, for the Company)
under the Securities Act.  If such a Registration Statement is so required,
the Company covenants and agrees to use its commercially reasonable efforts to
(x) have in effect a Registration Statement covering any securities to be
delivered in respect of the Purchase Contracts being settled and (y) provide a
Prospectus in connection therewith, in each case in a form that may be used in
connection with such Cash Merger Early Settlement.  If a Holder elects a
Cash Merger Early Settlement of some or all of its Purchase Contracts, such
Holder shall be entitled to receive, on the Cash Merger Early Settlement Date,
the aggregate amount of any accrued and unpaid Contract Adjustment Payments,
with 

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

    respect
to such Purchase Contracts (except when the Cash Merger Early Settlement Date
falls after any Record Date and prior to the next succeeding Payment Date, in
which case Contract Adjustment Payments shall be payable to the Person in whose
name a Certificate is registered at the close of business on such Record Date
relating to the next succeeding Payment Date).  The Company shall pay such
amount as a credit against the amount otherwise payable by such Holder to effect
such Cash Merger Early Settlement.

     

     

    Within
five Business Days of the completion of a Cash Merger, the Company shall provide
written notice to Holders of such completion of a Cash Merger, which shall
specify the deadline for submitting the notice to settle early in cash pursuant
to this Section
5.04(b)(ii), the date on which such Cash Merger Early Settlement shall
occur (which date shall be at least ten days after the date of such written
notice by the Company, but which shall in no event be later than the earlier of
20 days after the date of such written notice by the Company and the seventh
Business Day immediately preceding the Purchase Contract Settlement Date) (the
“Cash Merger Early Settlement
Date”), the applicable Settlement Rate and the amount (per share of
Common Stock) of cash, securities and other consideration receivable by the
Holder, including the amount of Contract Adjustment Payments receivable, upon
settlement.

     

     

    Corporate
Units Holders (unless Applicable Ownership Interests in the Treasury Portfolio
have replaced Applicable Ownership Interests in Senior Notes as a component of
the Corporate Units) and Treasury Units Holders may only effect Cash Merger
Early Settlement pursuant to this Section 5.04(b)(ii) in
integral multiples of 40 Corporate Units or Treasury Units, as the case may
be.  If Applicable Ownership Interests in the Treasury Portfolio have
replaced Applicable Ownership Interests in Senior Notes as a component of the
Corporate Units, Corporate Units Holders may only effect Cash Merger Early
Settlement pursuant to this Section 5.04(b)(ii) in
multiples of 4,000 Corporate Units.  Other than the provisions relating to
timing of notice and settlement, which shall be as set forth in the immediately
preceding paragraph, the provisions of Section 5.01 shall apply with
respect to a Cash Merger Early Settlement pursuant to this Section
5.04(b)(ii).

     

     

    In order
to exercise the right to effect Cash Merger Early Settlement with respect to any
Purchase Contracts, the Holder of the Certificate evidencing Units shall
deliver, no later than 5:00 p.m. (New York City time) on the third Business Day
immediately preceding the Cash Merger Early Settlement Date, such Certificate to
the Purchase Contract Agent at the Corporate Trust Office duly endorsed for
transfer to the Company or in blank with the form of Election to Settle Early on
the reverse thereof duly completed and accompanied by payment (payable to the
Company in immediately available funds) in an amount equal to the result
of:

     

     

    (i)           the
product of (A) the Stated Amount times (B) the number of Purchase Contracts with
respect to which the Holder has elected to effect Cash Merger Early Settlement,
less

     

     

    (ii)           the
amount of any accrued and unpaid Contract Adjustment Payments (except when the
Cash Merger Early Settlement Date falls after any Record Date and prior to the
next succeeding Payment Date).

     

     

    Upon
receipt of such Certificate and payment of such funds, the Purchase Contract
Agent shall pay the Company from such funds the related Purchase Price pursuant
to the terms of the related Purchase Contracts, and notify the Collateral Agent
that all the conditions necessary for a Cash Merger Early Settlement by a Holder
have been satisfied pursuant to which the Purchase Contract Agent has received
from such Holder, and paid to the Company as confirmed in writing by the
Company, the related Purchase Price.

     

     

    Upon
receipt by the Collateral Agent of the notice from the Purchase Contract Agent
set forth in the immediately preceding paragraph, the Collateral Agent shall
release from the Pledge, (1) the Senior Notes underlying the Pledged Applicable
Ownership Interests in Senior Notes or the Pledged Applicable Ownership
Interests in the Treasury Portfolio, in the case of a Holder of Corporate Units
or (2) the Pledged Treasury Securities, in the case of a Holder of Treasury
Units, in each case with a Value equal to the product of (x) the Stated Amount
and (y) the number of Purchase Contracts as to which such Holder has elected to
effect Cash Merger Early Settlement, and shall instruct the Securities
Intermediary to Transfer all such Pledged Applicable Ownership Interests in the
Treasury Portfolio or Senior Notes underlying Pledged Applicable Ownership
Interests in Senior

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     Notes
or Pledged Treasury Securities, as the case may be, to the Purchase Contract
Agent for distribution to such Holder, in each case free and clear of the Pledge
created hereby.

     

     

    If a
Holder properly effects an effective Cash Merger Early Settlement in accordance
with the provisions of this Section 5.04(b)(ii), the
Company will deliver (or will cause the Collateral Agent to deliver) to the
Holder on the Cash Merger Early Settlement Date:

     

     

    (A)           the
kind and amount of securities, cash and other property receivable upon such Cash
Merger by a Holder of the number of shares of Common Stock issuable on account
of each Purchase Contract (regardless of any choice by a Holder pursuant to
Section 5.08 to receive
Preferred Stock in lieu of Common Stock) if the Purchase Contract Settlement
Date had occurred immediately prior to such Cash Merger (based on the Settlement
Rate in effect at such time), assuming such Holder of Common Stock is not a
Constituent Person or an Affiliate of a Constituent Person to the extent such
Cash Merger provides for different treatment of Common Stock held by Affiliates
of the Company and non-affiliates and such Holder failed to exercise its rights
of election, if any, as to the kind or amount of securities, cash and other
property receivable upon such Cash Merger (provided that if the kind or
amount of securities, cash and other property receivable upon such Cash Merger
is not the same for each non-electing share, then for the purpose of this Section 5.04(b)(ii), the kind
and amount of securities, cash and other property receivable upon such Cash
Merger by each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares).  For the
avoidance of doubt, for the purposes of determining the Applicable Market Value
(in connection with determining the appropriate Settlement Rate to be applied in
the foregoing sentence), the date of the closing of the Cash Merger shall be
deemed to be the Purchase Contract Settlement Date;

     

     

    (B)           the
Senior Notes, the Applicable Ownership Interests in the Treasury Portfolio or
Treasury Securities, as the case may be, related to the Purchase Contracts with
respect to which the Holder is effecting a Cash Merger Early Settlement;
and

     

     

    (C)           if
so required under the Securities Act, a Prospectus as contemplated by this Section
5.04(b)(ii).

     

     

    The
Corporate Units or the Treasury Units of the Holders who do not elect Cash
Merger Early Settlement in accordance with the foregoing will continue to remain
outstanding and be subject to settlement on the Purchase Contract Settlement
Date in accordance with the terms hereof.

     

     

    (c)           All
calculations and determinations pursuant to this Section 5.04 shall be made by
the Company or its agent and the Purchase Contract Agent shall have no
responsibility with respect to this Agreement.

     

     

    Section
5.05.          Notice of Adjustments and
Certain Other Events.  (a) Whenever the Fixed Settlement Rate is
adjusted as provided under Section 5.04(a), or the
Settlement Rate is adjusted under Section 5.04(b), the Company
shall within 10 Business Days following the occurrence of an event that requires
such adjustment (or if the Company is not aware of such occurrence, as soon as
reasonably practicable after becoming so aware):

     

     

    (i)           compute
the adjusted Fixed Settlement Rate or Settlement Rate, as the case may be, in
accordance with Section
5.04 and prepare and transmit to the Purchase Contract Agent an Officers’
Certificate setting forth the Fixed Settlement Rate or Settlement Rate, as the
case may be, the method of calculation thereof in reasonable detail, and the
facts requiring such adjustment and upon which such adjustment is based;
and

     

     

    (ii)           provide
a written notice to the Holders of the Units of the occurrence of such event and
a statement in reasonable detail setting forth the method by which the
adjustment to the Fixed Settlement Rate or Settlement Rate, as the case may be,
was determined and setting forth the adjusted Fixed Settlement Rate or
Settlement Rate, as the case may be.

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

     

    (b)           The
Purchase Contract Agent shall not at any time be under any duty or
responsibility to any Holder of Units to determine whether any facts exist which
may require any adjustment of the Fixed Settlement Rate or Settlement Rate, as
the case may be, or with respect to the nature or extent or calculation of any
such adjustment when made, or with respect to the method employed in making the
same.  The Purchase Contract Agent shall be fully authorized and protected
in relying on any Officers’ Certificate delivered pursuant to Section 5.05(a)(i) and any
adjustment contained therein and the Purchase Contract Agent shall not be deemed
to have knowledge of any adjustment unless and until it has received such
certificate.  The Purchase Contract Agent shall not be accountable with
respect to the validity or value (or the kind or amount) of any shares of Common
Stock or Preferred Stock, as applicable, or of any securities or property, which
may at the time be issued or delivered with respect to any Purchase Contract;
and the Purchase Contract Agent makes no representation with respect
thereto.  The Purchase Contract Agent shall not be responsible for any
failure of the Company to issue, transfer or deliver any shares of Common Stock
or Preferred Stock, as applicable, pursuant to a Purchase Contract or to comply
with any of the duties, responsibilities or covenants of the Company contained
in this Article.

     

     

    Section
5.06.          Termination Event;
Notice.  The Purchase Contracts and all obligations and rights of
the Company and the Holders thereunder, including, without limitation, the
rights of the Holders to receive and the obligation of the Company to pay any
Contract Adjustment Payments (including any accrued and unpaid Contract
Adjustment Payments), if the Company shall have such obligation, and the rights
and obligations of Holders to purchase Common Stock or Preferred Stock, as
applicable, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, prior to or on the Purchase Contract Settlement Date, a Termination
Event shall have occurred.

     

     

    Upon and
after the occurrence of a Termination Event, the Units shall thereafter
represent the right to receive the Senior Notes, the Treasury Securities or the
appropriate Applicable Ownership Interests in the Treasury Portfolio, as the
case may be, forming part of such Units, in accordance with the provisions of
Section 5.04 of the
Pledge Agreement.  Upon the occurrence of a Termination Event, the Company
shall promptly but in no event later than two Business Days thereafter give
written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security
Register.

     

     

    Section
5.07.          Early
Settlement.  (a) Subject to and upon compliance with the provisions
of this Section 5.07, at
the option of the Holder thereof, Purchase Contracts underlying Units having an
aggregated Stated Amount equal to $1,000 or an integral multiple thereof may be
settled early (“Early
Settlement”) at any time on or prior to 5:00 p.m. (New York City time) on
the seventh Business Day immediately preceding the Purchase Contract Settlement
Date; provided that no
Early Settlement will be permitted pursuant to this Section 5.07 unless, at the
time such Early Settlement is effected, there is an effective Registration
Statement with respect to any securities to be issued and delivered in
connection with such Early Settlement, if such a Registration Statement is
required (in the view of counsel, which need not be in the form of a written
opinion, for the Company) under the Securities Act.  If such a Registration
Statement is so required, the Company covenants and agrees to use reasonable
best efforts to (i) have in effect a Registration Statement covering any
securities to be delivered in respect of the Purchase Contracts being settled
and (ii) provide a Prospectus in connection therewith, in each case in a form
that may be used in connection with such Early Settlement.

     

     

    (b)           In
order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts, the Holder of the Certificate evidencing Units shall
deliver, at any time prior to 5:00 p.m. (New York City time) on the seventh
Business Day immediately preceding the Purchase Contract Settlement Date, such
Certificate to the Purchase Contract Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount (the “Early Settlement Amount”)
equal to the sum of:

     

     

    (i)           the
product of (A) the Stated Amount times (B) the number of Purchase Contracts with
respect to which the Holder has elected to effect Early Settlement,
plus

     

     

    (ii)           if
such delivery is made with respect to any Purchase Contracts during the period
from the close of business on any Record Date next preceding any Payment Date to
the 

     

    
      
        
        

      

      
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    opening
of business on such Payment Date, an amount equal to the Contract Adjustment
Payments payable on such Payment Date with respect to such Purchase
Contracts.

     

     

    Except as
provided in the immediately preceding sentence, no payment shall be made upon
Early Settlement of any Purchase Contract on account of any Contract Adjustment
Payments accrued on such Purchase Contract or on account of any dividends on the
Common Stock or Preferred Stock, as applicable, issued upon such Early
Settlement.  If the foregoing requirements are first satisfied with respect
to Purchase Contracts underlying any Units on or prior to 5:00 p.m. (New York
City time) on a Business Day, such day shall be the “Early Settlement Date” with
respect to such Units and if such requirements are first satisfied after 5:00
p.m. (New York City time) on a Business Day or on a day that is not a Business
Day, the “Early Settlement
Date” with respect to such Units shall be the next succeeding Business
Day.

     

     

    Upon the
receipt of such Certificate and Early Settlement Amount from the Holder, the
Purchase Contract Agent shall pay to the Company such Early Settlement Amount,
the receipt of which payment the Company shall confirm in writing.  The
Purchase Contract Agent shall then, in accordance with Section 5.06 of the Pledge
Agreement, notify the Collateral Agent that (A) such Holder has elected to
effect an Early Settlement, which notice shall set forth the number of such
Purchase Contracts as to which such Holder has elected to effect Early
Settlement, (B) the Purchase Contract Agent has received from such Holder, and
paid to the Company as confirmed in writing by the Company, the related Early
Settlement Amount and (C) all conditions to such Early Settlement have been
satisfied.

     

     

    Holders
of Treasury Units may only effect Early Settlement pursuant to this Section 5.07 in integral
multiples of 40 Treasury Units.  If the Treasury Portfolio has replaced the
Senior Notes as a component of the Corporate Units, Corporate Units Holders may
only effect Early Settlement pursuant to this Section 5.07 in integral
multiples of 4,000 Corporate Units.

     

     

    Upon
Early Settlement of the Purchase Contracts, the rights of the Holders to receive
and the obligation of the Company to pay any Contract Adjustment Payments
(including any accrued and unpaid Contract Adjustment Payments) with respect to
such Purchase Contracts shall immediately and automatically
terminate.

     

     

    (c)           Upon
Early Settlement of Purchase Contracts by a Holder of the related Units, the
Company shall issue, and the Holder shall be entitled to receive, 0.9954 newly
issued shares of Common Stock, or 0.09954 newly issued shares of Preferred
Stock, as applicable, as adjusted in the same manner and the same time as the
Settlement Rate is adjusted (the “Early Settlement
Rate”).

     

     

    (d)           No
later than the third Business Day after the applicable Early Settlement Date,
the Company shall cause:

     

     

    (i)           the
shares of Common Stock or Preferred Stock, as applicable, issuable upon Early
Settlement of Purchase Contracts to be issued and delivered, together with
payment in lieu of any fraction of a share, as provided in Section 5.09; and

     

     

    (ii)           the
related Pledged Senior Notes or the Applicable Ownership Interests in the
Treasury Portfolio (as specified in clause (i) of the definition of such term),
as applicable, in the case of Corporate Units, or the related Pledged Treasury
Securities, in the case of Treasury Units, to be released from the Pledge by the
Collateral Agent, free and clear of the Company’s security interest therein, and
transferred, in each case, to the Purchase Contract Agent for delivery to the
Holder thereof or its designee.

     

     

    (e)           Upon
Early Settlement of any Purchase Contracts, and subject to receipt of shares of
Common Stock or Preferred Stock, as applicable, from the Company and the Senior
Notes, the Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio or Treasury Securities, as
the case may be, from the Securities Intermediary, as applicable, the Purchase
Contract Agent shall, in accordance with the instructions provided by the Holder
thereof on the applicable form of Election to Settle Early on the reverse of the
Certificate evidencing the related Units:

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

     

    (i)           transfer
to the Holder the Senior Notes, the Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio or
Treasury Securities, as the case may be, forming a part of such
Units,

     

     

    (ii)           deliver
to the Holder a certificate or certificates for the full number of shares of
Common Stock or Preferred Stock, as applicable, issuable upon such Early
Settlement, together with payment in lieu of any fraction of a share, as
provided in Section
5.09, and

     

     

    (iii)           if
so required under the Securities Act, deliver a Prospectus for the shares of
Common Stock or Preferred Stock, as applicable, issuable upon such Early
Settlement as contemplated by (a).

     

     

    (f)           In
the event that Early Settlement is effected with respect to Purchase Contracts
underlying less than all the Units evidenced by a Certificate, upon such Early
Settlement the Company shall execute and the Purchase Contract Agent shall
execute on behalf of the Holder, authenticate and deliver to the Holder thereof,
at the expense of the Company, a Certificate evidencing the Units as to which
Early Settlement was not effected.

     

     

    (g)           A
Holder of a Unit who effects Early Settlement may elect to have the Senior Notes
no longer a part of a Corporate Unit remarketed in accordance with the
provisions of Section
5.02.

     

     

    Section
5.08.          Election to Receive
Preferred Stock in Lieu of Common Stock.  At any time prior to the
Purchase Contract Settlement Date, any Holder may elect that its obligation to
purchase, and the Company’s related obligation to issue and sell to it, Common
Stock pursuant to the terms of this Article 5 be converted into
obligations to purchase, issue and sell Preferred Stock, by delivering written
notice of such election to the Purchase Contract Agent and the Company. 
Upon such election, such Holder shall become obligated to purchase, and the
Company shall become obligated to issue and sell to it, one-tenth of a share of
Preferred Stock for each share of Common Stock that such Holder would otherwise
be obligated to purchase, and the Company would be obligated to issue and sell,
pursuant to this Article
5.  Any such election can be terminated by delivering subsequent
written notice of such termination to the Purchase Contract Agent and the
Company prior to the Purchase Contract Settlement Date.

     

     

    At any
time prior to the Purchase Contract Settlement Date, Holders of not less than a
majority of the Outstanding Units may, by delivering written notice to the
Company, request the Company to amend the Statement of Resolutions to delete
clause (3) of Section D of Article I thereof, and upon such request, the
Statement of Resolutions shall be so amended.

     

     

    Section
5.09.          No Fractional
Shares.  No fractional shares or scrip representing fractional
shares of Common Stock or Preferred Stock, as applicable, shall be issued or
delivered upon settlement on the Purchase Contract Settlement Date, or upon
Early Settlement or Cash Merger Early Settlement of any Purchase
Contracts.  If Certificates evidencing more than one Purchase Contract
shall be surrendered for settlement at one time by the same Holder, the number
of full shares of Common Stock or Preferred Stock, as applicable, that shall be
delivered upon settlement shall be computed on the basis of the aggregate number
of Purchase Contracts evidenced by the Certificates so surrendered. 
Instead of any fractional share of Common Stock or Preferred Stock, as
applicable, that would otherwise be deliverable upon settlement of any Purchase
Contracts on the Purchase Contract Settlement Date, or upon Early Settlement or
Cash Merger Early Settlement, the Company, through the Purchase Contract Agent,
shall make a cash payment in respect of such fractional interest in an amount
equal to the percentage of such fractional share times the Applicable Market
Value calculated as if the date of such settlement were the Purchase Contract
Settlement Date.  The Company shall provide the Purchase Contract Agent
from time to time with sufficient funds to permit the Purchase Contract Agent to
make all cash payments required by this Section 5.09 in a timely
manner.

     

     

    Section
5.10.          Charges and
Taxes.  The Company will pay all stock transfer and similar taxes
attributable to the initial issuance and delivery of the shares of Common Stock
or Preferred Stock, as applicable, pursuant to the Purchase Contracts; provided, however, that the
Company shall not be required to pay any such tax 

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

    or taxes
which may be payable in respect of any exchange of or substitution for a
Certificate evidencing a Unit or any issuance of a share of Common Stock or
Preferred Stock, as applicable, in a name other than that of the registered
Holder of a Certificate surrendered in respect of the Units evidenced thereby,
other than in the name of the Purchase Contract Agent, as custodian for such
Holder, and the Company shall not be required to issue or deliver such share
certificates or Certificates unless or until the Person or Persons requesting
the transfer or issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the satisfaction of the Company that such
tax has been paid.

     

     

    Section
5.11.          Contract Adjustment
Payments.  (a)  Subject to Section 5.11(d), the Company
shall pay, on each Payment Date, the Contract Adjustment Payments payable in
respect of each Purchase Contract to the Person in whose name a Certificate is
registered at the close of business on the Record Date relating to such Payment
Date.  The Contract Adjustment Payments will be payable at the office of
the Purchase Contract Agent in the Borough of Manhattan, New York City
maintained for that purpose.  The Contract Adjustment Payments will be
payable, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person’s address as it appears on the Security
Register, or by wire transfer to the account designated by such Person by a
prior written notice to the Purchase Contract Agent.  If any date on which
Contract Adjustment Payments are to be made is not a Business Day, then payment
of the Contract Adjustment Payments payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest in respect
of such delay).  Contract Adjustment Payments payable for any period will
be computed on the basis of a 360-day year of twelve 30-day months.  The
Contract Adjustment Payments will accrue from October 7, 2005.

     

     

    (b)           Upon
the occurrence of a Termination Event, the Company’s obligation to pay future
Contract Adjustment Payments (including any accrued Contract Adjustment
Payments) shall cease.

     

     

    (c)           Each
Certificate delivered under this Agreement upon registration of transfer of or
in exchange for or in lieu of (including as a result of a Collateral
Substitution or the recreation of Corporate Units) any other Certificate shall
carry the right to accrued and unpaid Contract Adjustment Payments, which right
was carried by the Purchase Contracts underlying such other
Certificates.

     

     

    (d)           In
the case of any Unit with respect to which Early Settlement or Cash Merger Early
Settlement of the underlying Purchase Contract is effected on a date that is
after any Record Date and prior to or on the next succeeding Payment Date,
Contract Adjustment Payments otherwise payable on such Payment Date shall be
payable on such Payment Date notwithstanding such Early Settlement or Cash
Merger Early Settlement, and such Contract Adjustment Payments shall be paid to
the Person in whose name the Certificate evidencing such Unit is registered at
the close of business on such Record Date. Except as otherwise expressly
provided in the immediately preceding sentence, and the right to receive accrued
and unpaid Contract Adjustment Payments as set forth in Section 5.04(b)(ii), in the
case of any Unit with respect to which Early Settlement or Cash Merger Early
Settlement of the underlying Purchase Contract is effected, Contract Adjustment
Payments that would otherwise be payable after the Early Settlement or Cash
Merger Early Settlement Date with respect to such Purchase Contract shall not be
payable.

     

     

    (e)           The
Company’s obligations with respect to Contract Adjustment Payments, if any, will
be subordinated and junior in right of payment to the Company’s obligations
under any Senior Indebtedness.

     

     

    (f)           In
the event (x) of any payment by, or distribution of assets of, the Company of
any kind or character, whether in cash, property or securities, to creditors
upon any dissolution, winding-up, liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, or (y) subject to the provisions of Section 5.11(h) below, that
(i) a default shall have occurred and be continuing with respect to the payment
of principal, interest or any other monetary amounts due and payable on any
Senior Indebtedness and such default shall have continued beyond the period of
grace, if any, specified in the instrument evidencing such Senior Indebtedness
(and the Purchase Contract Agent shall have received written notice thereof from
the Company or one or more holders of Senior Indebtedness or their
representative or representatives or the trustee or trustees under any indenture
pursuant to which any such Senior Indebtedness may have been issued), or (ii)
the maturity of any Senior Indebtedness shall have been accelerated because of a
default in respect of such Senior Indebtedness (and the Purchase Contract Agent
shall have received written notice thereof from the 

     

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

    

    Company
or one or more holders of Senior Indebtedness or their representative or
representatives or the trustee or trustees under any indenture pursuant to which
any such Senior Indebtedness may have been issued), then:

     

     

    (i)           
the holders of all Senior Indebtedness shall first be entitled to receive, in
the case of clause (x) above, payment of all amounts due or to become due upon
all Senior Indebtedness and, in the case of subclauses (i) and (ii) of clause
(y) above, payment of all amounts due thereon, or provision shall be made for
such payment in money or money’s worth, before the Holders of any of the Units
are entitled to receive any Contract Adjustment Payments on the Purchase
Contracts underlying the Units;

     

     

    (ii)           any
payment by, or distribution of assets of, the Company of any kind or character,
whether in cash, property or securities, to which the Holders of any of the
Units would be entitled except for the provisions of Section 5.11(e) through (q),
including any such payment or distribution which may be payable or deliverable
by reason of the payment of any other indebtedness of the Company being
subordinated to the payment of such Contract Adjustment Payments on the Purchase
Contracts underlying the Units, shall be paid or delivered by the Person making
such payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the representative or
representatives of the holders of Senior Indebtedness or to the trustee or
trustees under any indenture under which any instruments evidencing any of such
Senior Indebtedness may have been issued, ratably according to the aggregate
amounts remaining unpaid on account of such Senior Indebtedness held or
represented by each, to the extent necessary to make payment in full of all
Senior Indebtedness remaining unpaid after giving effect to any concurrent
payment or distribution (or provision therefor) to the holders of such Senior
Indebtedness, before any payment or distribution is made of such Contract
Adjustment Payments to the Holders of such Units; and

     

     

    (iii)           in
the event that, notwithstanding the foregoing, any payment by, or distribution
of assets of, the Company of any kind or character, whether in cash, property or
securities, including any such payment or distribution which may be payable or
deliverable by reason of the payment of any other indebtedness of the Company
being subordinated to the payment of Contract Adjustment Payments on the
Purchase Contracts underlying the Units, shall be received by the Purchase
Contract Agent or the Holders of any of the Units when such payment or
distribution is prohibited pursuant to Section 5.11(e) through (q),
such payment or distribution shall be paid over to the representative or
representatives of the holders of Senior Indebtedness or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing any
such Senior Indebtedness may have been issued, ratably as aforesaid, for
application to the payment of all Senior Indebtedness remaining unpaid until all
such Senior Indebtedness shall have been paid in full, after giving effect to
any concurrent payment or distribution (or provision therefor) to the holders of
such Senior Indebtedness.

     

     

    (g)           For
purposes of Section 5.11(e)
through (q), the words “cash, property or securities” shall not be deemed
to include shares of stock of the Company as reorganized or readjusted, or
securities of the Company or any other Person provided for by a plan of
reorganization or readjustment, the payment of which is subordinated at least to
the extent provided in Section
5.11(e) through (q) with respect to such Contract Adjustment Payments on
the Units to the payment of all Senior Indebtedness which may at the time be
outstanding; provided
that (i) the indebtedness or guarantee of indebtedness, as the case may be, that
constitutes Senior Indebtedness is assumed by the Person, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the holders of
the Senior Indebtedness are not, without the consent of each such holder
adversely affected thereby, altered by such reorganization or
readjustment;

     

     

    (h)           Any
failure by the Company to make any payment on or perform any other obligation
under Senior Indebtedness, other than any indebtedness incurred by the Company
or assumed or guaranteed, directly or indirectly, by the Company for money
borrowed (or any deferral, renewal, extension or refunding thereof) or any
indebtedness or obligation as to which the provisions of Section 5.11(e) through (q)
shall have been waived by the Company in the instrument or instruments by which
the Company incurred, assumed, guaranteed or otherwise created such indebtedness
or obligation, shall not be deemed a default or event of default if (i) the
Company shall be disputing its obligation to make such payment or perform such
obligation and (ii) either (A) no final judgment relating to such dispute shall
have been issued against the Company which is in full force and effect and is
not

     

    
      
        
        

      

      
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    subject
to further review, including a judgment that has become final by reason of the
expiration of the time within which a party may seek further appeal or review,
and (B) in the event a judgment that is subject to further review or appeal has
been issued, the Company shall in good faith be prosecuting an appeal or other
proceeding for review and a stay of execution shall have been obtained pending
such appeal or review.

     

     

    (i)           Subject
to the irrevocable payment in full of all Senior Indebtedness, the Holders of
the Units shall be subrogated (equally and ratably with the holders of all
obligations of the Company which by their express terms are subordinated to
Senior Indebtedness of the Company to the same extent as payment of the Contract
Adjustment Payments in respect of the Purchase Contracts underlying the Units is
subordinated and which are entitled to like rights of subrogation) to the rights
of the holders of Senior Indebtedness to receive payments or distributions of
cash, property or securities of the Company applicable to the Senior
Indebtedness until all such Contract Adjustment Payments owing on the Units
shall be paid in full, and as between the Company, its creditors other than
holders of such Senior Indebtedness and the Holders, no such payment or
distribution made to the holders of Senior Indebtedness by virtue of Section 5.11(e) through (q)
that otherwise would have been made to the Holders shall be deemed to be a
payment by the Company on account of such Senior Indebtedness, it being
understood that the provisions of Section 5.11(e) through (q)
are and are intended solely for the purpose of defining the relative rights of
the Holders, on the one hand, and the holders of Senior Indebtedness, on the
other hand.

     

     

    (j)           Nothing
contained in Section 5.11(e)
through (q) or elsewhere in this Agreement or in the Units is intended to
or shall impair, as among the Company, its creditors other than the holders of
Senior Indebtedness and the Holders, the obligation of the Company, which is
absolute and unconditional, to pay to the Holders such Contract Adjustment
Payments on the Units as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders and creditors of the Company other than the holders of
Senior Indebtedness, nor shall anything herein or therein prevent the Purchase
Contract Agent or any Holder from exercising all remedies otherwise permitted by
applicable law upon default under this Agreement, subject to the rights, if any,
under Section 5.11(e) through
(q), of the holders of Senior Indebtedness in respect of cash, property
or securities of the Company received upon the exercise of any such
remedy.

     

     

    (k)           Upon
payment or distribution of assets of the Company referred to in Section 5.11(e) through (q),
the Purchase Contract Agent and the Holders shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction in which any such
dissolution, winding up, liquidation or reorganization proceeding affecting the
affairs of the Company is pending or upon a certificate of the trustee in
bankruptcy, receiver, assignee for the benefit of creditors, liquidating trustee
or Purchase Contract Agent or other person making any payment or distribution,
delivered to the Purchase Contract Agent or to the Holders, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Section 5.11(e) through
(q).

     

     

    (l)           The
Purchase Contract Agent shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or representative on behalf of such holder) to
establish that such notice has been given by a holder of Senior Indebtedness or
a trustee or representative on behalf of any such holder or holders.  In
the event that the Purchase Contract Agent determines in good faith that further
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
Section 5.11(e) through
(q), the Purchase Contract Agent may request such Person to furnish
evidence to the reasonable satisfaction of the Purchase Contract Agent as to the
amount of Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under Section 5.11(e) through (q),
and, if such evidence is not furnished, the Purchase Contract Agent may defer
payment to such Person pending judicial determination as to the right of such
Person to receive such payment.

     

     

    (m)           Nothing
contained in Section 5.11(e)
through (q) shall affect the obligations of the Company to make, or
prevent the Company from making, payment of the Contract Adjustment Payments,
except as otherwise provided in this Section 5.11(e) through
(q).

     

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

     

    (n)           Each
Holder of Units, by its acceptance thereof, authorizes and directs the Purchase
Contract Agent on its behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in Section 5.11(e) through (q)
and appoints the Purchase Contract Agent its attorney-in-fact, as the case may
be, for any and all such purposes.

     

     

    (o)           The
Company shall give prompt written notice to the Purchase Contract Agent of any
fact known to the Company that would prohibit the making of any payment of
moneys to or by the Purchase Contract Agent in respect of the Units pursuant to
the provisions of this Section.  Notwithstanding the provisions of Section 5.11(e) through (q) or
any other provisions of this Agreement, the Purchase Contract Agent shall not be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment of moneys to or by the Purchase Contract Agent, or the
taking of any other action by the Purchase Contract Agent, unless and until the
Purchase Contract Agent shall have received written notice thereof mailed or
delivered to the Purchase Contract Agent at its Institutional Trust Services
department from the Company, any Holder, or the holder or representative of any
Senior Indebtedness; provided that if at least two
Business Days prior to the date upon which by the terms hereof any such moneys
may become payable for any purpose, the Purchase Contract Agent shall not have
received with respect to such moneys the notice provided for in this Section,
then, anything herein contained to the contrary notwithstanding, the Purchase
Contract Agent shall have full power and authority to receive such moneys and to
apply the same to the purpose for which they were received and shall not be
affected by any notice to the contrary that may be received by it within two
Business Days prior to or on or after such date.

     

     

    (p)           The
Purchase Contract Agent in its individual capacity shall be entitled to all the
rights set forth in this Section with respect to any Senior Indebtedness at the
time held by it, to the same extent as any other holder of Senior Indebtedness
and nothing in this Agreement shall deprive the Purchase Contract Agent of any
of its rights as such holder.

     

     

    (q)           No
right of any present or future holder of any Senior Indebtedness to enforce the
subordination herein shall at any time or in any way be prejudiced or impaired
by any act or failure to act on the part of the Company or by any noncompliance
by the Company with the terms, provisions and covenants of this Agreement,
regardless of any knowledge thereof which any such holder may have or be
otherwise charged with.

     

     

    (r)           Nothing
in this Section 5.11
shall apply to claims of, or payments to, the Purchase Contract Agent under or
pursuant to Section
7.07.

     

     

    (s)           With
respect to the holders of Senior Indebtedness, (i) the duties and obligations of
the Purchase Contract Agent shall be determined solely by the express provisions
of this Agreement; (ii) the Purchase Contract Agent shall not be liable to any
such holders if it shall, acting in good faith, mistakenly pay over or
distribute to the Holders or to the Company or any other Person cash, property
or securities to which any holders of Senior Indebtedness shall be entitled by
virtue of this Section
5.11 or otherwise; (iii) no implied covenants or obligations shall be
read into this Agreement against the Purchase Contract Agent; and (iv) the
Purchase Contract Agent shall not be deemed to be a fiduciary as to such
holders.

     

     

    ARTICLE
6

     

    REMEDIES

     

     

    Section
6.01.          Unconditional Right of
Holders to Receive Contract Adjustment Payments and to Purchase Shares of Common
Stock or Preferred Stock.  Each Holder of a Unit shall have the
right, which is absolute and unconditional, (i) subject to Article 5, to receive each
Contract Adjustment Payment with respect to the Purchase Contract comprising
part of such Unit on the respective Payment Date for such Unit and (ii) except
upon and following a Termination Event, to purchase shares of Common Stock or
Preferred Stock, as applicable, pursuant to such Purchase Contract and, in each
such case, to institute suit for the enforcement of any such right to receive
Contract Adjustment Payments and the right to purchase shares of Common Stock or
Preferred Stock, as applicable, and such rights shall not be impaired without
the consent of such Holder.

     

    
      
        
        

      

      
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    Section
6.02.          Restoration of Rights and
Remedies.  If any Holder has instituted any proceeding to enforce
any right or remedy under this Agreement and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company and such Holder shall be restored severally and
respectively to their former positions hereunder, and thereafter all rights and
remedies of such Holder shall continue as though no such proceeding had been
instituted.

     

     

    Section
6.03.          Rights and Remedies
Cumulative.  Except as otherwise provided with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Certificates in
the last paragraph of Section
3.10, no right or remedy herein conferred upon or reserved to the Holders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise.  The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

     

     

    Section
6.04.          Delay or Omission Not
Waiver.  No delay or omission of any Holder to exercise any right
upon a default or remedy upon a default shall impair any such right or remedy or
constitute a waiver of any such right.  Every right and remedy given by
this Article or by law to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by such Holders.

     

     

    Section
6.05.          Undertaking for
Costs.  All parties to this Agreement agree, and each Holder of a
Unit, by its acceptance of such Unit shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Agreement, or in any suit against the Purchase
Contract Agent for any action taken, suffered or omitted by it as Purchase
Contract Agent, the filing by any party litigant in such suit of an undertaking
to pay the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys’ fees and costs against any
party litigant in such suit, having due regard to the merits and good faith of
the claims or defenses made by such party litigant; provided that the provisions
of this Section shall not apply to any suit instituted by the Purchase Contract
Agent, to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Units, or to any suit instituted by
any Holder for the enforcement of interest on any Senior Notes or Contract
Adjustment Payments on or after the respective Payment Date therefor in respect
of any Unit held by such Holder, or for enforcement of the right to purchase
shares of Common Stock or Preferred Stock, as applicable, under the Purchase
Contracts constituting part of any Unit held by such Holder.

     

     

    Section
6.06.          Waiver of Stay or Extension
Laws.  The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Agreement; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Purchase Contract Agent or the
Holders, but will suffer and permit the execution of every such power as though
no such law had been enacted.

     

     

    ARTICLE
7

     

    THE
PURCHASE CONTRACT AGENT

     

     

    Section
7.01.          Certain Duties and
Responsibilities.  (a)  The Purchase Contract
Agent:

     

     

    (i)           undertakes
to perform, with respect to the Units, such duties and only such duties as are
specifically set forth to be performed by it in this Agreement, the Pledge
Agreement and the Remarketing Agreement and no implied covenants or obligations
shall be read into this Agreement, the Pledge Agreement or the Remarketing
Agreement against the Purchase Contract Agent; and

     

    
      
        
        

      

      
        48

        
          

        

      

      
        
        

      

    

     

    (ii)           in
the absence of bad faith or gross negligence on its part, may, with respect to
the Units, conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Purchase Contract Agent and conforming to the requirements of
this Agreement or the Pledge Agreement or the Remarketing Agreement, as
applicable, but in the case of any certificates or opinions which by any
provision hereof are specifically required to be furnished to the Purchase
Contract Agent, the Purchase Contract Agent shall be under a duty to examine the
same to determine whether or not they conform to the requirements of this
Agreement, the Pledge Agreement or the Remarketing Agreement, as applicable (but
need not confirm or investigate the accuracy of the mathematical calculations or
other facts stated therein).

     

     

    (b)           No
provision of this Agreement, the Pledge Agreement or the Remarketing Agreement
shall be construed to relieve the Purchase Contract Agent from liability for its
own grossly negligent action, its own grossly negligent failure to act, or its
own willful misconduct, except that:

     

     

    (i)           this
subsection shall not be construed to limit the effect of subsection (a) of this
Section;

     

     

    (ii)           the
Purchase Contract Agent shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be conclusively determined
by a court of competent jurisdiction that the Purchase Contract Agent was
grossly negligent in ascertaining the pertinent facts; and

     

     

    (iii)           no
provision of this Agreement or the Pledge Agreement or the Remarketing Agreement
shall require the Purchase Contract Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to
it.

     

     

    (c)           Whether
or not therein expressly so provided, every provision of this Agreement, the
Pledge Agreement and the Remarketing Agreement relating to the conduct or
affecting the liability of or affording protection to the Purchase Contract
Agent shall be subject to the provisions of this Section.

     

     

    (d)           The
Purchase Contract Agent is authorized to execute and deliver the Pledge
Agreement and the Remarketing Agreement in its capacity as Purchase Contract
Agent.

     

     

    Section
7.02.          Notice of
Default.  Within 30 days after the occurrence of any default by the
Company hereunder of which a Responsible Officer of the Purchase Contract Agent
has actual knowledge, the Purchase Contract Agent shall transmit by mail to the
Company and the Holders of Units, as their names and addresses appear in the
Security Register, notice of such default hereunder, unless such default shall
have been cured or waived.

     

     

    Section
7.03.          Certain Rights of Purchase
Contract Agent.  Subject to the provisions of Section 7.01:

     

     

    (a)           the
Purchase Contract Agent may, in the absence of bad faith, conclusively rely and
shall be fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, Senior Note, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;

     

     

    (b)           any
request or direction of the Company mentioned herein shall be sufficiently
evidenced by an Officers’ Certificate, Issuer Order or Issuer Request, and any
resolution of the Board of Directors of the Company may be sufficiently
evidenced by a Board Resolution;

     

     

    (c)           whenever
in the administration of this Agreement, the Pledge Agreement or the Remarketing
Agreement the Purchase Contract Agent shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting to take any action
hereunder, the Purchase Contract Agent (unless other 

     

    
      
        
        

      

      
        49

        
          

        

      

      
        
        

      

    

    evidence
be herein specifically prescribed in this Agreement) may, in the absence of bad
faith on its part, conclusively rely upon an Officers’ Certificate of the
Company;

     

     

    (d)           the
Purchase Contract Agent may consult with counsel of its selection appointed with
due care by it hereunder and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;

     

     

    (e)           the
Purchase Contract Agent shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Purchase Contract Agent, in its discretion, may make reasonable further inquiry
or investigation into such facts or matters related to the execution, delivery
and performance of the Purchase Contracts as it may see fit, and, if the
Purchase Contract Agent shall determine to make such further inquiry or
investigation, it shall be entitled to examine the relevant books, records and
premises of the Company, personally or by agent or attorney;

     

     

    (f)           the
Purchase Contract Agent may execute any of the powers hereunder or perform any
duties hereunder either directly or by or through agents, attorneys, custodians
or nominees or an Affiliate and the Purchase Contract Agent shall not be
responsible for any misconduct or negligence on the part of any agent, attorney,
custodian or nominee or an Affiliate appointed with due care by it
hereunder;

     

     

    (g)           the
Purchase Contract Agent shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement at the request or direction of
any of the Holders pursuant to this Agreement, unless such Holders shall have
offered to the Purchase Contract Agent security or indemnity reasonably
satisfactory to the Purchase Contract Agent against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;

     

     

    (h)           the
Purchase Contract Agent shall not be liable for any action taken, suffered, or
omitted to be taken by it in the absence of bad faith or gross negligence by
it;

     

     

    (i)           the
Purchase Contract Agent shall not be deemed to have notice of any default
hereunder unless a Responsible Officer of the Purchase Contract Agent has actual
knowledge thereof or unless written notice of any event that is in fact such a
default is received by the Purchase Contract Agent at the Corporate Trust Office
of the Purchase Contract Agent, and such notice references the Units and this
Agreement;

     

     

    (j)           the
Purchase Contract Agent may request that the Company deliver an Officers’
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Agreement,
which Officers’ Certificate may be signed by any person authorized to sign an
Officers’ Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded;

     

     

    (k)           the
rights, privileges, protections, immunities and benefits given to the Purchase
Contract Agent, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Purchase Contract Agent in each of
its capacities hereunder, and to each agent, custodian and other Person employed
to act hereunder; and

     

     

    (l)           the
Purchase Contract Agent shall not be required to initiate or conduct any
litigation or collection proceedings hereunder and shall have no
responsibilities with respect to any default hereunder except as expressly set
forth herein.

     

     

    Section
7.04.          Not Responsible for Recitals
or Issuance of Units.  The recitals contained herein, in the Pledge
Agreement, the Remarketing Agreement and in the Certificates shall be taken as
the statements of the Company, and the Purchase Contract Agent assumes no
responsibility for their accuracy or validity.  The Purchase Contract Agent
makes no representations as to the validity or sufficiency of either this
Agreement or 

     

    
      
        
        

      

      
        50

        
          

        

      

      
        
        

      

    

    of the
Units, or of the Pledge Agreement or the Pledge or the Collateral and shall have
no responsibility for perfecting or maintaining the perfection of any security
interest in the Collateral.  The Purchase Contract Agent shall not be
accountable for the use or application by the Company of the proceeds in respect
of the Purchase Contracts.

     

     

    Section
7.05.          May Hold Units. 
Any Security Registrar or any other agent of the Company, or the Purchase
Contract Agent and its Affiliates, in their individual or any other capacity,
may become the owner or pledgee of Units and may otherwise deal with the
Company, the Collateral Agent or any other Person with the same rights it would
have if it were not Security Registrar or such other agent, or the Purchase
Contract Agent.  The Company may become the owner or pledgee of
Units.

     

     

    Section
7.06.          Money Held in
Custody.  Money held by the Purchase Contract Agent in custody
hereunder need not be segregated from the Purchase Contract Agent’s other funds
except to the extent required by law or provided herein.  The Purchase
Contract Agent shall be under no obligation to invest or pay interest on any
money received by it hereunder except as otherwise provided hereunder or agreed
in writing with the Company.

     

     

    Section
7.07.          Compensation and
Reimbursement.  The Company agrees:

     

     

    (a)           to
pay to the Purchase Contract Agent compensation for all services rendered by it
hereunder, under the Pledge Agreement and under the Remarketing Agreement as the
Company and the Purchase Contract Agent shall from time to time agree in
writing;

     

     

    (b)           except
as otherwise expressly provided for herein, to reimburse the Purchase Contract
Agent upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Purchase Contract Agent in accordance with any provision
of this Agreement, the Pledge Agreement and the Remarketing Agreement (including
the reasonable compensation and the expenses and disbursements of its agents and
counsel) in connection with the negotiation, preparation, execution and delivery
and performance of this Agreement, the Pledge Agreement and the Remarketing
Agreement and any modification, supplement or waiver of any of the terms
thereof, except any such expense, disbursement or advance as may be attributable
to its gross negligence, willful misconduct or bad faith; and

     

     

    (c)           to
indemnify the Purchase Contract Agent and any predecessor Purchase Contract
Agent (and each of its directors, officers, agents and employees (collectively,
the “Indemnitees”) for,
and to hold it harmless against, any loss, claim, damage, fine, penalty,
liability or expense (including reasonable fees and expenses of counsel)
incurred without gross negligence, willful misconduct or bad faith on its part,
arising out of or in connection with the acceptance or administration of its
duties hereunder and under the Pledge Agreement and the Remarketing Agreement,
including the Indemnitees’ reasonable costs and expenses of defending themselves
against any claim (whether asserted by the Company, a Holder or any other
person) or liability in connection with the exercise or performance of any of
the Purchase Contract Agent’s powers or duties hereunder or
thereunder.

     

     

    The
provisions of this Section shall survive the resignation and removal of the
Purchase Contract Agent and the termination of this Agreement.

     

     

    Section
7.08.          Corporate Purchase Contract
Agent Required, Eligibility.  There shall at all times be a Purchase
Contract Agent hereunder which shall be a Person organized and doing business
under the laws of the United States of America, any State thereof or the
District of Columbia, authorized under such laws to exercise corporate trust
powers, having (or being a member of a bank holding company having) a combined
capital and surplus of at least $50,000,000, subject to supervision or
examination by Federal or State authority and having a corporate trust office in
the Borough of Manhattan, New York City, if there be such a Person in the
Borough of Manhattan, New York City, qualified and eligible under this Article
and willing to act on reasonable terms.  If such Person publishes reports
of condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published.  If at any time the Purchase Contract Agent shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.

     

     

    
      
        
        

      

      
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    Section
7.09.          Resignation and Removal;
Appointment of Successor.  (a)  No resignation or removal of
the Purchase Contract Agent and no appointment of a successor Purchase Contract
Agent pursuant to this Article shall become effective until the acceptance of
appointment by the successor Purchase Contract Agent in accordance with the
applicable requirements of Section 7.10.

     

     

    (b)           The
Purchase Contract Agent may resign at any time by giving written notice thereof
to the Company 60 days prior to the effective date of such resignation.  If
the instrument of acceptance by a successor Purchase Contract Agent required by
Section 7.10 shall not
have been delivered to the Purchase Contract Agent within 30 days after the
giving of such notice of resignation, the resigning Purchase Contract Agent may
petition, at the expense of the Company, any court of competent jurisdiction for
the appointment of a successor Purchase Contract Agent.

     

     

    (c)           The
Purchase Contract Agent may be removed at any time by Act of the Holders of at
least a majority in number of the Outstanding Units delivered to the Purchase
Contract Agent and the Company.  If the instrument of acceptance by a
successor Purchase Contract Agent required by Section 7.10 shall not have
been delivered to the Purchase Contract Agent within 30 days after such Act, the
Purchase Contract Agent being removed may petition any court of competent
jurisdiction for the appointment at the expense of the Company of a successor
Purchase Contract Agent.

     

     

    (d)           If
at any time:

     

     

    (i)           the
Purchase Contract Agent fails to comply with Section 310(b) of the TIA, as if
the Purchase Contract Agent were an indenture trustee under an indenture
qualified under the TIA, and shall fail to resign after written request therefor
by the Company or by any Holder who has been a bona fide Holder of a Unit for at
least six months;

     

     

    (ii)           the
Purchase Contract Agent shall cease to be eligible under Section 7.08 and shall fail to
resign after written request therefor by the Company or by any such Holder;
or

     

     

    (iii)           the
Purchase Contract Agent shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Purchase Contract Agent or of its
property shall be appointed or any public officer shall take charge or control
of the Purchase Contract Agent or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,

     

     

    then, in
any such case, (i) the Company by a Board Resolution may remove the Purchase
Contract Agent, or (ii) any Holder who has been a bona fide Holder of a Unit for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Purchase
Contract Agent and the appointment of a successor Purchase Contract
Agent.

     

     

    (e)           If
the Purchase Contract Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Purchase Contract Agent for
any cause, the Company, by a Board Resolution, shall promptly appoint a
successor Purchase Contract Agent and shall comply with the applicable
requirements of Section
7.10.  If no successor Purchase Contract Agent shall have been so
appointed by the Company and accepted appointment in the manner required by
Section 7.10, any Holder
who has been a bona fide Holder of a Unit for at least six months, on behalf of
itself and all others similarly situated, or the Purchase Contract Agent may
petition at the expense of the Company any court of competent jurisdiction for
the appointment of a successor Purchase Contract Agent.

     

     

    (f)           The
Company shall give, or shall cause such successor Purchase Contract Agent to
give, notice of each resignation and each removal of the Purchase Contract Agent
and each appointment of a successor Purchase Contract Agent by mailing written
notice of such event by first-class mail, postage prepaid, to all Holders as
their names and addresses appear in the applicable Security Register.  Each
notice shall include the name of the successor Purchase Contract Agent and the
address of its Corporate Trust Office.

     

    
      
        
        

      

      
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    Section
7.10.          Acceptance of Appointment by
Successor.  (a)  In case of the appointment hereunder of a
successor Purchase Contract Agent, every such successor Purchase Contract Agent
so appointed shall execute, acknowledge and deliver to the Company and to the
retiring Purchase Contract Agent an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Purchase Contract Agent
shall become effective and such successor Purchase Contract Agent, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, agencies and duties of the retiring Purchase Contract Agent; but, on the
request of the Company or the successor Purchase Contract Agent, such retiring
Purchase Contract Agent shall, upon payment of its charges, execute and deliver
an instrument transferring to such successor Purchase Contract Agent all the
rights, powers and trusts of the retiring Purchase Contract Agent and duly
assign, transfer and deliver to such successor Purchase Contract Agent all
property and money held by such retiring Purchase Contract Agent
hereunder.

     

     

    (b)           Upon
request of any such successor Purchase Contract Agent, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Purchase Contract Agent all such rights, powers and agencies
referred to in subsection (a) of this Section.

     

     

    (c)           No
successor Purchase Contract Agent shall accept its appointment unless at the
time of such acceptance such successor Purchase Contract Agent shall be
qualified and eligible under this Article.

     

     

    Section
7.11.          Merger, Conversion,
Consolidation or Succession to Business.  Any Person into which the
Purchase Contract Agent may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Purchase Contract Agent shall be a party, or any
Person succeeding to all or substantially all the corporate trust business of
the Purchase Contract Agent, shall be the successor of the Purchase Contract
Agent hereunder, provided that such Person
shall be otherwise qualified and eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.  In case any Certificates shall have been authenticated and
executed on behalf of the Holders, but not delivered, by the Purchase Contract
Agent then in office, any successor by merger, conversion or consolidation to
such Purchase Contract Agent may adopt such authentication and execution and
deliver the Certificates so authenticated and executed with the same effect as
if such successor Purchase Contract Agent had itself authenticated and executed
such Units.

     

     

    Section
7.12.          Preservation of Information;
Communications to Holders.  (a)  The Purchase Contract Agent
shall preserve, in as current a form as is reasonably practicable, the names and
addresses of Holders received by the Purchase Contract Agent in its capacity as
Security Registrar.

     

     

    (b)           If
three or more Holders (herein referred to as “Applicants”) apply in writing
to the Purchase Contract Agent, and furnish to the Purchase Contract Agent
reasonable proof that each such applicant has owned a Unit for a period of at
least six months preceding the date of such application, and such application
states that the applicants desire to communicate with other Holders with respect
to their rights under this Agreement or under the Units and is accompanied by a
copy of the form of proxy or other communication which such applicants propose
to transmit, then the Purchase Contract Agent shall mail to all the Holders
copies of the form of proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the Purchase Contract
Agent of the materials to be mailed and of payment, or provision for the
payment, of the reasonable expenses of such mailing.

     

     

    Section
7.13.          No Obligations of Purchase
Contract Agent.  Except to the extent otherwise expressly provided
in this Agreement, the Purchase Contract Agent assumes no obligations and shall
not be subject to any liability under this Agreement, the Pledge Agreement, the
Remarketing Agreement or any Purchase Contract in respect of the obligations of
the Holder of any Unit thereunder.  The Company agrees, and each Holder of
a Certificate, by its acceptance thereof, shall be deemed to have agreed, that
the Purchase Contract Agent’s execution of the Certificates on behalf of the
Holders shall be solely as agent and attorney-in-fact for the Holders, and that
the Purchase Contract Agent shall have no obligation to perform such Purchase
Contracts on behalf of the Holders, except to the extent expressly provided in
Article 5 hereof. 
Anything contained in this Agreement to the contrary notwithstanding, in no
event shall the Purchase Contract Agent or its officers, directors, employees or
agents be liable under this Agreement, the Pledge Agreement or the Remarketing
Agreement to any third party for indirect, 

     

    
      
        
        

      

      
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    incidental,
special, punitive, or consequential loss or damage of any kind whatsoever,
including lost profits, whether or not the likelihood of such loss or damage was
known to the Purchase Contract Agent and regardless of the form of
action.

     

     

    Section
7.14.          Tax Compliance. 
(a)  The Purchase Contract Agent, on its own behalf and on behalf of the
Company, will comply with all applicable certification, information reporting
and withholding (including “backup” withholding) requirements imposed by
applicable tax laws, regulations or administrative practice with respect to (i)
any payments made with respect to the Units or (ii) the issuance, delivery,
holding, transfer, redemption or exercise of rights under the Units.  Such
compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated
agent.

     

     

    (b)           The
Purchase Contract Agent shall comply in accordance with the terms hereof with
any reasonable written direction received from the Company with respect to the
execution or certification of any required documentation and the application of
such requirements to particular payments or Holders or in other particular
circumstances, and may for purposes of this Agreement conclusively rely on any
such direction in accordance with the provisions of Section 7.01(a)
hereof.

     

     

    (c)           The
Purchase Contract Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available, on
written request, to the Company or its authorized representative within a
reasonable period of time after receipt of such request.

     

     

    ARTICLE
8

     

    SUPPLEMENTAL
AGREEMENTS

     

     

    Section
8.01.          Supplemental Agreements
Without Consent of Holders.  Without the consent of any Holders, the
Company, when authorized by a Board Resolution, and the Purchase Contract Agent,
at any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Purchase
Contract Agent, to:

     

     

    (a)           evidence
the succession of another Person to the Company, and the assumption by any such
successor of the covenants of the Company herein and in the
Certificates;

     

     

    (b)           add
to the covenants of the Company for the benefit of the Holders, or surrender any
right or power herein conferred upon the Company;

     

     

    (c)           evidence
and provide for the acceptance of appointment hereunder by a successor Purchase
Contract Agent;

     

     

    (d)           make
provision with respect to the rights of Holders pursuant to the requirements of
Section
5.04(b);

     

     

    (e)           except
as provided for in Section
5.04, cure any ambiguity (or formal defect) or correct or supplement any
provisions herein which may be inconsistent with any other provisions herein;
or

     

     

    (f)           make
any other provisions with respect to such matters or questions arising under
this Agreement, provided that such action
shall not adversely affect the interests of the Holders in any material
respect.

     

     

    Section
8.02.          Supplemental Agreements with
Consent of Holders.  With the consent of the Holders of not less
than a majority of the Outstanding Units voting together as one class, including
without limitation the consent of the Holders obtained in connection with a
tender or an exchange offer, by Act of said Holders delivered to the Company and
the Purchase Contract Agent, the Company, when duly authorized, and the Purchase
Contract 

     

    
      
        
        

      

      
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    Agent may
enter into an agreement or agreements supplemental hereto for the purpose of
modifying in any manner the terms of the Purchase Contracts, or the provisions
of this Agreement or the rights of the Holders in respect of the Units; provided, however, that, except as
contemplated herein, no such supplemental agreement shall, without the unanimous
consent of the Holders of each outstanding Purchase Contract affected
thereby,

     

     

    (a)           change
any Payment Date;

     

     

    (b)           change
the amount or the type of Collateral required to be Pledged to secure a Holder’s
obligations under the Purchase Contract, unless such change is not adverse to
the Holders, impair the right of the Holder of any Purchase Contract to receive
distributions on the related Collateral or otherwise adversely affect the
Holder’s rights in or to such Collateral or adversely alter the rights in or to
such Collateral;

     

     

    (c)           reduce
any Contract Adjustment Payments or change any place where, or the coin or
currency in which, any Contract Adjustment Payment is payable;

     

     

    (d)           impair
the right to institute suit for the enforcement of any Purchase Contract or any
Contract Adjustment Payments;

     

     

    (e)           reduce
the number of shares of Common Stock or Preferred Stock, as applicable, or the
amount of any other property to be purchased pursuant to any Purchase Contract,
increase the price to purchase shares of Common Stock or Preferred Stock, as
applicable, or any other property upon settlement of any Purchase Contract or
change the Purchase Contract Settlement Date or the right to Early Settlement or
Cash Merger Early Settlement or otherwise adversely affect the Holder’s rights
under the Purchase Contract; or

     

     

    (f)           reduce
the percentage of the outstanding Purchase Contracts the consent of whose
Holders is required for any modification or amendment to the provisions of this
Agreement, the Purchase Contracts or the Pledge Agreement;

     

     

    provided that if any
amendment or proposal referred to above would adversely affect only the
Corporate Units or the Treasury Units, then only the affected class of Holders
as of the record date for the Holders entitled to vote thereon will be entitled
to vote on such amendment or proposal, and such amendment or proposal shall not
be effective except with the consent of Holders of not less than a majority of
such class; and provided, further, that the unanimous
consent of the Holders of each outstanding Purchase Contract of such class
affected thereby shall be required to approve any amendment or proposal
specified in clauses (a) through (f) above.

     

     

    It shall
not be necessary for any Act of Holders under this Section to approve the
particular form of any proposed supplemental agreement, but it shall be
sufficient if such Act shall approve the substance thereof.

     

     

    Section
8.03.          Execution of Supplemental
Agreements.  In executing, or accepting the additional agencies
created by, any supplemental agreement permitted by this Article or the
modifications thereby of the agencies created by this Agreement, the Purchase
Contract Agent shall be provided, and (subject to Section 7.01) shall be fully
authorized and protected in relying upon, an Officers’ Certificate and an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement and that any and all conditions
precedent to the execution and delivery of such supplemental agreement have been
satisfied.  The Purchase Contract Agent may, but shall not be obligated to,
enter into any such supplemental agreement which affects the Purchase Contract
Agent’s own rights, duties or immunities under this Agreement or
otherwise.

     

     

    Section
8.04.          Effect of Supplemental
Agreements.  Upon the execution of any supplemental agreement under
this Article, this Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Agreement for all purposes; and
every Holder of Certificates theretofore or thereafter authenticated, executed
on behalf of the Holders and delivered hereunder, shall be bound
thereby.

     

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

    

     

    Section
8.05.          Reference to Supplemental
Agreements.  Certificates authenticated, executed on behalf of the
Holders and delivered after the execution of any supplemental agreement pursuant
to this Article may, and shall if required by the Purchase Contract Agent, bear
a notation in form approved by the Purchase Contract Agent as to any matter
provided for in such supplemental agreement.  If the Company shall so
determine, new Certificates so modified as to conform, in the opinion of the
Purchase Contract Agent and the Company, to any such supplemental agreement may
be prepared and executed by  the Company and authenticated, executed on
behalf of the Holders and delivered by the Purchase Contract Agent in exchange
for outstanding Certificates.

     

     

    ARTICLE
9

     

    CONSOLIDATION,
MERGER, CONVEYANCE, TRANSFER OR LEASE

     

     

    Section
9.01.          Covenant Not to Consolidate,
Merge, Convey, Transfer or Lease Property Except under Certain
Conditions.  The Company covenants that it will not consolidate
with, convert into, or merge with and into, any other corporation or sell,
assign, transfer, lease or convey all or substantially all of its properties and
assets to any Person, unless:

     

     

    (a)      
either the Company shall be the continuing corporation, or the successor (if
other than the Company) shall be a corporation organized and existing under the
laws of the United States of America or a State thereof or the District of
Columbia and such corporation shall expressly assume all the obligations of the
Company under the Purchase Contracts, this Agreement, the Pledge
Agreement, the Indenture (including any supplement thereto), the Remarketing
Agreement by one or more supplemental agreements in form reasonably satisfactory
to the Purchase Contract Agent and the Collateral Agent, executed and delivered
to the Purchase Contract Agent and the Collateral Agent by such corporation;
and

     

     

    (b)      
the Company or such successor corporation, as the case may be, shall not,
immediately after such consolidation, conversion, merger, sale, assignment,
transfer, lease or conveyance,

     

     

    be in
default of payment obligations under the Purchase Contracts, this Agreement, the
Pledge Agreement, the Indenture (including any supplement thereto) or the
Remarketing Agreement or in material default in the performance of any other
covenants under any of the foregoing agreements.

     

     

    Section
9.02.          Rights and Duties of
Successor Corporation.  In case of any such merger, consolidation,
share exchange, sale, assignment, transfer, lease or conveyance and upon any
such assumption by a successor corporation in accordance with Section 9.01, such successor
corporation shall succeed to and be substituted for the Company with the same
effect as if it had been named herein as the Company.  Such successor
corporation thereupon may cause to be signed, and may issue either in its own
name or in the name of PNM Resources, Inc., any or all of the Certificates
evidencing Units issuable hereunder which theretofore shall not have been signed
by the Company and delivered to the Purchase Contract Agent; and, upon the order
of such successor corporation, instead of the Company, and subject to all the
terms, conditions and limitations in this Agreement prescribed, the Purchase
Contract Agent shall authenticate and execute on behalf of the Holders and
deliver any Certificates which previously shall have been signed and delivered
by the officers of the Company to the Purchase Contract Agent for authentication
and execution, and any Certificate evidencing Units which such successor
corporation thereafter shall cause to be signed and delivered to the Purchase
Contract Agent for that purpose.  All the Certificates issued shall in
all  respects have the same legal rank and benefit under this Agreement as
the Certificates theretofore or thereafter issued in accordance with the terms
of this Agreement as though all of such Certificates had been issued at the date
of the execution hereof.

     

     

    In case
of any such merger, consolidation, share exchange, sale, assignment, transfer,
lease or conveyance, such change in phraseology and form (but not in substance)
may be made in the Certificates evidencing Units thereafter to be issued as may
be appropriate.

     

     

    Section
9.03.          Officers’ Certificate and
Opinion of Counsel Given to Purchase Contract Agent.  The Purchase
Contract Agent, subject to Sections 7.01 and 7.03, shall receive an
Officers’ Certificate and an Opinion of 

     

    
      
        
        

      

      
        56

        
          

        

      

      
        
        

      

    

    Counsel
as conclusive evidence that any such merger, consolidation, share exchange,
sale, assignment, transfer, lease or conveyance, and any such assumption,
complies with the provisions of this Article and that all conditions precedent
to the consummation of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance have been met.

     

     

    ARTICLE
10

     

    COVENANTS

     

     

    Section
10.01.        Performance Under Purchase
Contracts.  The Company covenants and agrees for the benefit of the
Holders from time to time of the Units that it will duly and punctually perform
its obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.

     

     

    Section
10.02.        Maintenance of Office or
Agency.  The Company will maintain in the Borough of Manhattan, New
York City an office or agency where Certificates may be presented or surrendered
for acquisition of shares of Common Stock or Preferred Stock, as applicable,
upon settlement of the Purchase Contracts on the Purchase Contract Settlement
Date or upon Early Settlement or Cash Merger Early Settlement and for transfer
of Collateral upon occurrence of a Termination Event, where Certificates may be
surrendered for registration of transfer or exchange, for a Collateral
Substitution or recreation of Corporate Units and where notices and demands to
or upon the Company in respect of the Units and this Agreement may be
served.  The Company will give prompt written notice to the Purchase
Contract Agent of the location, and any change in the location, of such office
or agency.  The Company initially designates the Corporate Trust Office of
the Purchase Contract Agent as such office of the Company.  If at any time
the Company shall fail to maintain any such required office or agency or shall
fail to furnish the Purchase Contract Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Company hereby appoints the Purchase Contract
Agent as its agent to receive all such presentations, surrenders, notices and
demands.

     

     

    The
Company may also from time to time designate one or more other offices or
agencies where Certificates may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in the Borough of Manhattan, New York
City for such purposes.  The Company will give prompt written notice to the
Purchase Contract Agent of any such designation or rescission and of any change
in the location of any such other office or agency.  The Company hereby
designates as the place of payment for the Units the Corporate Trust Office and
appoints the Purchase Contract Agent at its Corporate Trust Office as paying
agent in such city.

     

     

    Section
10.03.        Company to Reserve Common
Stock and Preferred Stock.  The Company shall at all times prior to
the Purchase Contract Settlement Date reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock or Preferred
Stock the full number of shares of Common Stock or Preferred Stock, as
applicable, issuable against tender of payment in respect of all Purchase
Contracts constituting a part of the Units evidenced by Outstanding
Certificates.

     

     

    Section
10.04.        Covenants as to Common Stock
and Preferred Stock.  The Company covenants that all shares of
Common Stock or Preferred Stock, as applicable, which may be issued against
tender of payment in respect of any Purchase Contract constituting a part of the
Outstanding Units will, upon issuance, be duly authorized, validly issued, fully
paid and nonassessable.

     

     

    Section
10.05.        Statements of Officers of
the Company as to Default.  The Company will deliver to the Purchase
Contract Agent, within 120 days after the end of each fiscal year of the Company
ending after the date hereof, an Officers’ Certificate, stating whether or not
to the knowledge of the signers thereof the Company is in default in the
performance and observance of any of the terms, provisions and conditions
hereof, and if the Company shall be in default, specifying all such defaults and
the nature and status thereof of which they may have knowledge.

     

     

    
      
        
        

      

      
        57

        
          

        

      

      
        
        

      

    

    Section
10.06.        ERISA.  Each
Holder from time to time of the Units that is a Plan or who used assets of a
Plan to purchase Units hereby represents that either (i) no portion of the
assets used by such Holder to acquire the Corporate Units constitutes assets of
the Plan or (ii) the purchase or holding of the Corporate Units by such
purchaser or transferee will not constitute a non-exempt prohibited transaction
under Section 406 of ERISA or Section 4975 of the Code or similar violation
under any applicable laws.

     

     

    Section
10.07.        Tax Treatment. 
The Company covenants and agrees, for United States federal, state and local
income and franchise tax purposes, to (i) treat a Holder’s acquisition of the
Corporate Units as the acquisition of the Senior Note and Purchase Contract
constituting the Corporate Units and (ii) treat each Holder as the owner of the
applicable interest in the Collateral Account, including the Senior Notes and
Applicable Ownership Interests in the Treasury Portfolio or the Treasury
Securities.

     

     

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK;

     

    SIGNATURE
PAGE FOLLOWS]

     

    
      
         

      

      
        58 

        
          

        

      

      
         

      

    

     

    [SIGNATURE
PAGE TO AMENDED AND RESTATED PURCHASE CONTRACT AGREEMENT]

     

     

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

     

    PNM
RESOURCES, INC.

     

     

    By:/s/Terry R.
Horn                                                      

    Terry R.
Horn

    Vice
President and Treasurer

     

     

     

                                    U.S. BANK NATIONAL
ASSOCIATION,

                                       as
Purchase Contract Agent

     

     

    By: /s/ Patrick J.
Crowley                                                                

    Patrick
J. Crowley

    Vice
President

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    EXHIBIT
A

     

     

    THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES
ACT”), AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.  EACH PURCHASER OF
ANY OF THESE SECURITIES IS HEREBY NOTIFIED THAT THE SELLER OF ANY OF THESE
SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

     

     

    THESE
SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)
(1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
ACQUIRING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A (IF AVAILABLE), (2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE), (3) TO AN ACCREDITED INVESTOR WITHIN THE
MEANING OF RULE 501(a) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT (IF AVAILABLE) OR (4)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND
(B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.

     

     

    IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE PURCHASE CONTRACT
AGENT SUCH OPINIONS OF COUNSEL, CERTIFICATES AND/OR OTHER INFORMATION AS IT MAY
REASONABLY REQUIRE IN FORM REASONABLY SATISFACTORY TO IT AS PROVIDED FOR IN THE
INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS
AS PROVIDED FOR IN THE INDENTURE.

     

     

    (FORM OF
FACE OF CORPORATE UNIT CERTIFICATE)

     

     

    No.
_________                                                                                                                                

     

    Number of
Corporate Units: ___________________

     

     

    PNM
RESOURCES, INC.

    Corporate
Units

     

     

    This
Corporate Units Certificate certifies that ___________ is the registered Holder
of the number of Corporate Units set forth above.  Each Corporate Unit
consists of (i) either (a) a 1/40th, or
2.5%, undivided beneficial ownership interest of the Holder in one Senior Note
due 2010 (the “Senior
Note”) of PNM Resources, Inc., a New Mexico corporation (the “Company”), subject to the
Pledge of such ownership interest of a Senior Note by such Holder pursuant to
the Pledge Agreement, or (b) upon the occurrence of a Special Event Redemption
prior to the Purchase Contract Settlement Date, the Applicable Ownership
Interests, subject to the pledge of the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio by such Holder pursuant to the Pledge Agreement, and (ii) the
rights and obligations of the Holder under one Purchase Contract with the
Company.  All capitalized terms used herein which are defined in the
Purchase Contract Agreement (as defined on the reverse hereof) have the meaning
set forth therein.

     

     

    Pursuant
to the Pledge Agreement, the Senior Notes or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, constituting part of each
Corporate Unit evidenced hereby have been pledged to the Collateral Agent, for
the benefit of the Company, to secure the obligations of the Holder under the
Purchase Contract comprising part of such Corporate Unit.

     

     

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

    The
Pledge Agreement provides that all payments of the principal amount with respect
to any of the Pledged Senior Notes (as defined in the Pledge Agreement) or the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, as the case may be, or
interest or distributions on any Pledged Senior Notes or the appropriate
Applicable Ownership Interests (as specified in clause (ii) of the definition of
such term) in the Treasury Portfolio, as the case may be, constituting part of
the Corporate Units received by the Securities Intermediary shall be paid by
wire transfer in same day funds (i) in the case of (A) interest on Pledged
Senior Notes or distributions with respect to the appropriate Applicable
Ownership Interests (as specified in clause (ii) of the definition of such term)
in the Treasury Portfolio, as the case may be, and (B) any payments of the
principal amount of any Senior Notes or with respect to the appropriate
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio, as the case may be, that have been
released from the Pledge pursuant to the Pledge Agreement, to the Purchase
Contract Agent to the account designated by the Purchase Contract Agent, no
later than 2:00 p.m., New York City time, on the Business Day such payment is
received by the Securities Intermediary (provided that in the event
such payment is received by the Securities Intermediary on a day that is not a
Business Day or after 12:30 p.m., New York City time, on a Business Day, then
such payment shall be made no later than 10:30 a.m., New York City time, on the
next succeeding Business Day) and (ii) in the case of payments with respect to
the principal amount of the Pledged Senior Notes or with respect to the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, to the Company on the
Purchase Contract Settlement Date (as described herein) in accordance with the
terms of the Pledge Agreement, in full satisfaction of the respective
obligations of the Holders of the Corporate Units of which such Pledged Senior
Notes or the Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, as the case may be, are a
part under the Purchase Contracts forming a part of such Corporate Units. 
Interest on the Senior Notes and distributions on the appropriate Applicable
Ownership Interests (as specified in clause (ii) of the definition of such term)
in the Treasury Portfolio, as the case may be, forming part of a Corporate Units
evidenced hereby, which are payable quarterly in arrears on February 16, May 16,
August 16, and November 16 of each year, commencing February 16, 2006 (a “Payment Date”), shall,
subject to receipt thereof by the Purchase Contract Agent from the Securities
Intermediary, be paid to the Person in whose name this Corporate Units
Certificate (or a Predecessor Corporate Units Certificate) is registered at the
close of business on the Record Date for such Payment Date.

     

     

    Each
Purchase Contract evidenced hereby obligates the Holder of this Corporate Units
Certificate to purchase, and the Company to sell, on November 16, 2008 (the
“Purchase Contract Settlement
Date”), at a price equal to $25 (the “Purchase Price”), a number of
newly issued shares of common stock, no par value, (“Common Stock”) (or, under
certain circumstances, one-tenth as many newly issued shares of Convertible
Preferred Stock, Class A (“Preferred Stock”)), of the
Company, equal to the Settlement Rate, unless on or prior to the Purchase
Contract Settlement Date there shall have occurred a Termination Event or an
Early Settlement or Cash Merger Early Settlement with respect to such Purchase
Contract, all as provided in the Purchase Contract Agreement and more fully
described on the reverse hereof.  The Purchase Price, if not paid earlier,
shall be paid on the Purchase Contract Settlement Date by application of payment
received in respect of the principal amount with respect to any Pledged Senior
Notes pursuant to the Remarketing or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, as the case may be, pledged to secure the obligations under
such Purchase Contract of the Holder of the Corporate Units of which such
Purchase Contract is a part.

     

     

    Each
Purchase Contract evidenced hereby obligates the holder to agree, for United
States federal, state and local income and franchise tax purposes, to (i) treat
an acquisition of the Corporate Units as an acquisition of the Senior Notes and
Purchase Contracts constituting the Corporate Units and (ii) treat itself as
owner of the applicable interest in the Collateral Account, including the Senior
Notes and the Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio.

     

     

    The
Company shall pay, on each Payment Date, in respect of each Purchase Contract
forming part of a Corporate Unit evidenced hereby, an amount (the “Contract Adjustment
Payments”) equal to 1.525% per year of the Stated Amount.  Such
Contract Adjustment Payments shall be payable to the Person in whose name this
Corporate Units Certificate is registered at the close of business on the Record
Date for such Payment Date.

     

     

    
      
        
        

      

      
        A-2

        
          

        

      

      
        
        

      

    

    Interest
on the Senior Notes and distributions on the Applicable Ownership Interests (as
specified in clause (ii) of the definition of such term) and the Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in New York City.  The Contract Adjustment Payments will be payable, at the
option of the Company, by check mailed to the address of the Person entitled
thereto at such Person’s address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.

     

     

    Reference
is hereby made to the further provisions 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 Purchase
Contract Agent by manual signature, this Corporate Units Certificate shall not
be entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.

     

    
      
        
          A-3

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    IN
WITNESS WHEREOF, the Company and the Holder specified above have caused this
instrument to be duly executed.

     

    PNM
RESOURCES, INC.

     

     

    By:                                                                  

    Name:

    Title:

     

     

     

    HOLDER
SPECIFIED ABOVE (as to obligations of such Holder under the Purchase
Contracts)

     

     

                                    By:  U.S. BANK
NATIONAL ASSOCIATION, not

                                            
individually but solely as attorney-in-fact of such

                                            
Holder

     

     

     

    By:                                                                  

    Name:

    Title:

     

     

    Date:
                                      

     

    
      
        
          A-4

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    CERTIFICATE
OF AUTHENTICATION

    OF
PURCHASE CONTRACT AGENT

     

     

    This is
one of the Corporate Units Certificates referred to in the within mentioned
Purchase Contract Agreement.

     

    
      	
               
      

            	
              By:   
      U.S. BANK NATIONAL ASSOCIATION, as Purchase Contract
  Agent

            

    

     

     

    By:                                                                  

    Name:

    Title:

     

     

    Date:
                                      

     

    

    
      
        
          A-5

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    (FORM OF
REVERSE OF CORPORATE UNIT CERTIFICATE)

     

     

    Each
Purchase Contract evidenced hereby is governed by an Amended and Restated
Purchase Contract Agreement, dated as of August 4, 2008 (as may be
supplemented from time to time, the “Purchase Contract
Agreement”), between the Company and U.S. Bank National Association, as
Purchase Contract Agent (including its successors hereunder, the “Purchase Contract Agent”), to
which Purchase Contract Agreement and supplemental agreements thereto reference,
is hereby made for a description of the respective rights, limitations of
rights, obligations, duties and immunities thereunder of the Purchase Contract
Agent, the Company, and the Holders and of the terms upon which the Corporate
Units Certificates are, and are to be, executed and delivered.

     

     

    Each
Purchase Contract evidenced hereby obligates the Holder of this Corporate Units
Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to $25 (the “Purchase Price”), a number of
shares of Common Stock (subject to Sections 5.08 and 5.09) equal to the Settlement
Rate (or under certain circumstances one-tenth as many shares of Preferred
Stock), unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred.  The “Settlement Rate” is equal
to:

     

     

    (1)    
if the Adjusted Applicable Market Value (as defined below) is greater than or
equal to $25.116 (the “Threshold Appreciation
Price”), 0.9954 shares of Common Stock per Purchase Contract, (such
number of shares, as adjusted from time to time pursuant to Section 5.04, the “Minimum Share
Number”);

     

     

    (2)    
if the Adjusted Applicable Market Value is less than the Threshold Appreciation
Price but greater than $20.93 (the “Reference Price”), the number
of shares of Common Stock per Purchase Contract having a value equal to the
Stated Amount divided by the Adjusted Applicable Market Value; and

     

     

    (3)    
if the Adjusted Applicable Market Value is less than or equal to the Reference
Price, 1.1945 shares of Common Stock per Purchase Contract, (such number of
shares, as adjusted from time to time pursuant to Section 5.04, the “Maximum Share
Number”),

     

     

    in each
case subject to adjustment as provided in the Purchase Contract Agreement (and
in each case rounded upward or downward to the nearest 1/10,000th of a
share).

     

     

    No
fractional shares of Common Stock or Preferred Stock, as applicable, will be
issued upon settlement of Purchase Contracts, as provided in Section 5.09 of the Purchase
Contract Agreement.

     

     

    Each
Purchase Contract evidenced hereby, which is settled through Early Settlement or
Cash Merger Early Settlement, shall obligate the Holder of the related Corporate
Units to purchase at the Purchase Price, and the Company to sell, a number of
newly issued shares of Common Stock (subject to Sections 5.08 and 5.09) equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).

     

     

    The “Adjusted Applicable Market
Value” means (i) prior to any adjustment pursuant to paragraph (i), (ii),
(iii), (iv), (v), (vi), (vii) or (x) of Section 5.04(a) of the
Purchase Contract Agreement, the Applicable Market Value, and (ii) at the time
of and after any adjustment of the Fixed Settlement Rate pursuant to paragraph
(i), (ii), (iii), (iv), (v), (vi), (vii) or (x) of Section 5.04(a) of the
Purchase Contract Agreement, the Applicable Market Value multiplied by a
fraction, the numerator of which shall be the Fixed Settlement Rate immediately
after such adjustment pursuant to paragraph (i), (ii), (iii), (iv), (v), (vi),
(vii) or (x) of Section
5.04(a) of the Purchase Contract Agreement and the denominator of which
shall be the Fixed Settlement Rate immediately prior to such adjustment; provided, however, that if such
adjustment to the Fixed Settlement Rate is required to be made pursuant to the
occurrence of any of the events contemplated by paragraph (i), (ii), (iii),
(iv), (v), (vi), (vii) or (x) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Fixed Settlement Rate.

     

     

    
      
        A-6

      

      
        
        

        
          

        

      

      
        
        

      

    

    The “Applicable Market Value”
means the average of the Closing Price per share of Common Stock on each of the
20 consecutive Trading Days ending on the third Trading Day immediately
preceding the Purchase Contract Settlement Date.

     

     

    The “Closing Price” per share of
Common Stock on any date of determination means:

     

     

    (1)    
the closing sale price as of the close of the principal trading session (or, if
no closing price is reported, the last reported sale price) per share on the New
York Stock Exchange, Inc. (the “NYSE”) on such
date;

     

     

    (2)    
if Common Stock is not listed for trading on the NYSE on any such date, the
closing sale price (or, if no closing price is reported, the last reported sale
price) per share as reported in the composite transactions for the principal
United States national or regional securities exchange on which Common Stock is
so listed;

     

     

    (3)    
if Common Stock is not so listed on a United States national or regional
securities exchange, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization; or

     

     

    (4)    
if the bid price referred to above is not available, the market value of Common
Stock on such date as determined by a nationally recognized independent
investment banking firm retained by the Company for purposes of determining the
Closing Price.

     

     

    A “Trading Day” means a day on
which Common Stock (1) is not suspended from trading on any national or regional
securities exchange or association or over-the-counter market at the close of
business and (2) has traded at least once on the national or regional securities
exchange or association or over-the-counter market that is the primary market
for the trading of Common Stock.

     

     

    In
accordance with the terms of the Purchase Contract Agreement, the Holder of this
Corporate Units Certificate may pay the Purchase Price for the shares of Common
Stock or Preferred Stock, as applicable, purchased pursuant to each Purchase
Contract evidenced hereby by effecting a Cash Settlement, an Early Settlement
or, if applicable, a Cash Merger Early Settlement or from the proceeds of the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio or a Remarketing of the related Pledged
Senior Notes.  Unless the Treasury Portfolio has replaced the Senior Notes
as a component of Corporate Units, a Holder of Corporate Units who (1) does not,
on or prior to 5:00 p.m. (New York City time) on the seventh Business Day
immediately preceding the Purchase Contract Settlement Date, notify the Purchase
Contract Agent of its intention to effect a Cash Settlement, or who does so
notify the Purchase Contract Agent but fails to make an effective Cash
Settlement on or prior to 5:00 p.m. (New York City time) on the sixth Business
Day immediately preceding the Purchase Contract Settlement Date, or (2) on or
prior to 5:00 p.m. (New York City time) on the seventh Business Day prior to the
Purchase Contract Settlement Date, does not make an effective Early Settlement,
shall pay the Purchase Price for the shares of Common Stock or Preferred Stock,
as applicable, to be delivered under the related Purchase Contract from the
proceeds of the sale of the related Pledged Senior Notes held by the Collateral
Agent in the Remarketing unless the Holder has previously made a Cash Merger
Early Settlement.  Unless the Treasury Portfolio has replaced the Senior
Notes as a component of Corporate Units, such sale will be made by the
Remarketing Agent pursuant to the terms of the Remarketing Agreement.  If
the Treasury Portfolio has replaced the Senior Notes as a component of Corporate
Units, a Holder of Corporate Units who does not notify the Purchase Contract
Agent, on or prior to 5:00 p.m. (New York City time) on the seventh Business Day
immediately preceding the Purchase Contract Settlement Date of its intention to
effect a Cash Settlement shall pay the Purchase Price for the shares of Common
Stock or Preferred Stock, as applicable, to be delivered under the related
Purchase Contract from the proceeds at maturity of the Applicable Ownership
Interests (as defined in clause (i) of the definition of such term) in the
Treasury Portfolio.

     

     

    As
provided in the Purchase Contract Agreement, upon the occurrence of a Failed
Final Remarketing, unless a Holder of a Pledged Senior Note has notified the
Purchase Contract Agent of his intent to effect a Cash Settlement of the
Purchase Contract and delivered the Purchase Price to the Collateral Agent
pursuant to Section
5.02(b) of the Purchase Contract Agreement, such Holder shall be deemed
to have exercised such Holder’s Put 

     

    
      
        A-7

      

      
        
        

        
          

        

      

      
        
        

      

    

    Right and
to have elected to pay the Purchase Price under the Purchase Contract out of a
portion of the proceeds from the Put Right in full satisfaction of such Holder’s
obligations under the Purchase Contract.  In the event of the Company’s
failure to pay the Put Price when due, the Company shall be deemed to have
netted such Holder’s obligation to pay the Company the Purchase Price under the
Purchase Contracts against the Company’s obligation to pay the Put Price, in
full satisfaction of such Holder’s obligation under the Purchase
Contracts.

     

     

    The
Company shall not be obligated to issue any shares of Common Stock or Preferred
Stock, as applicable, in respect of a Purchase Contract or deliver any
certificates therefor to the Holder unless it shall have received payment of the
aggregate Purchase Price for the shares of Common Stock or Preferred Stock, as
applicable, to be purchased thereunder in the manner set forth in the Purchase
Contract Agreement.

     

     

    Under the
terms of the Pledge Agreement and the Purchase Contract Agreement, the Purchase
Contract Agent will be entitled to exercise the voting and any other consensual
 rights pertaining to the Pledged Senior Notes, but only to the extent
instructed in writing by the Holders.  Upon receipt of notice of any
meeting at which holders of Senior Notes are entitled to vote or upon any
solicitation of consents, waivers or proxies of holders of Senior Notes, the
Purchase Contract Agent shall, as soon as practicable thereafter, mail, first
class, postage pre-paid, to the Corporate Units Holders a notice:

     

     

    (1)    
containing such information as is contained in the notice or
solicitation;

     

     

    (2)    
stating that each Holder on the record date set by the Purchase Contract Agent
therefor (which, to the extent possible, shall be the same date as the record
date for determining the holders of Senior Notes, as the case may be, entitled
to vote) shall be entitled to instruct the Purchase Contract Agent as to the
exercise of the voting rights pertaining to the Senior Notes underlying such
Holder’s Corporate Units; and

     

     

    (3)    
stating the manner in which such instructions may be given.

     

     

    Upon the
written request of the Corporate Units Holders on such record date received by
the Purchase Contract Agent at least six days prior to such meeting, the
Purchase Contract Agent shall endeavor insofar as practicable to vote or cause
to be voted, in accordance with the instructions set forth in such requests, the
maximum aggregate principal amount of Senior Notes, as the case may be, as to
which any particular voting instructions are received.  In the absence of
specific instructions from the Holder of a Corporate Unit, the Purchase Contract
Agent shall abstain from voting the Senior Note evidenced by such Corporate
Unit.  The Company hereby agrees, if applicable, to solicit Holders of
Corporate Units to timely instruct the Purchase Contract Agent in order to
enable the Purchase Contract Agent to vote the Senior Notes.  The Holders
of Corporate Units shall have no voting or other rights in respect of Common
Stock or Preferred Stock, as applicable.

     

     

    Upon the
occurrence of a Special Event Redemption, the Collateral Agent shall surrender
the Pledged Senior Notes against delivery of an amount equal to the aggregate
Redemption Price of the Pledged Senior Notes and shall deposit the funds in the
Collateral Account in exchange for the Pledged Senior Notes.  Thereafter,
pursuant to the terms of the Pledge Agreement, the Collateral Agent shall cause
the Securities Intermediary to apply an amount equal to the aggregate Redemption
Amount of such funds to purchase on behalf of the Holders of Corporate Units the
Treasury Portfolio and promptly (a) transfer the Applicable Ownership Interests
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio to the Collateral Account to secure the obligations of each Holder of
Corporate Units to purchase shares of Common Stock or Preferred Stock, as
applicable, under the Purchase Contracts constituting a part of such Corporate
Units, (b) transfer the Applicable Ownership Interests (as specified in clause
(ii) of the definition of such term) in the Treasury Portfolio to the Purchase
Contract Agent for the benefit of the Holders of such Corporate Units and (c)
remit the remaining portion of such funds to the Purchase Contract Agent for
payment to the Holders of such Corporate Units.

     

     

    Following
the occurrence of a Special Event Redemption prior to the Purchase Contract
Settlement Date, the Holders of Corporate Units and the Collateral Agent shall
have such security interest rights and obligations with respect to the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio as the Holder of Corporate Units and the
Collateral Agent had in respect of the Senior Notes, as 

     

    
      
        A-8

      

      
        
        

        
          

        

      

      
        
        

      

    

    the case
may be, subject to the Pledge of the Applicable Ownership Interest (as specified
in clause (i) of the definition of such term) as provided in the Pledge
Agreement and any reference herein to the Senior Notes shall be deemed to be a
reference to such Treasury Portfolio.

     

     

    The
Corporate Units Certificates are issuable only in denominations of a single
Corporate Unit and any integral multiple thereof.  The transfer of any
Corporate Units Certificate will be registered and Corporate Units Certificates
may be exchanged as provided in the Purchase Contract Agreement.  The
Security Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement.  No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Purchase Contract
Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.  A Holder who elects
to substitute a Treasury Security for a Senior Note, thereby creating Treasury
Units, shall be responsible for any fees or expenses payable in connection
therewith.  Except as provided in the Purchase Contract Agreement, for so
long as the Purchase Contract underlying a Corporate Units remains in effect,
such Corporate Units shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Corporate Units in respect of the
Senior Notes and Purchase Contract constituting such Corporate Units may be
transferred and exchanged only as a Corporate Unit.

     

     

    Unless
the Treasury Portfolio has replaced the Senior Notes as a component of the
Corporate Units, and subject to the conditions set forth in the Purchase
Contract Agreement, the Holder of Corporate Units may substitute, at any time on
or prior to 5:00 p.m. (New York City time) on the seventh Business Day
immediately preceding the Purchase Contract Settlement Date, for the Pledged
Senior Notes securing such Holder’s obligations under the related Purchase
Contracts, Treasury Securities in an aggregate principal amount at maturity
equal to the aggregate principal amount of the Pledged Senior Notes in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.  From and after such Collateral Substitution, each Unit for
which such Pledged Treasury Securities secures the Holder’s obligation under the
Purchase Contract shall be referred to as a “Treasury Unit”.  A
Holder may make such Collateral Substitution only in integral multiples of 40
Corporate Units for 40 Treasury Units.

     

     

    If the
Treasury Portfolio has replaced the Senior Notes as a component of the Corporate
Units, a Holder may, at any time on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, substitute Treasury
Securities for the Applicable Ownership Interests in the Treasury Portfolio, but
only in integral multiples of 4,000 Corporate Units.  In such an event, the
Holder shall transfer Treasury Securities to the Collateral Agent, and the
Purchase Contract Agent shall instruct the Collateral Agent to release the
Pledge and transfer to the Holder the appropriate Applicable Ownership Interests
in the Treasury Portfolio.

     

     

    The
Company shall pay, on each Payment Date, the Contract Adjustment Payments
payable in respect of each Purchase Contract to the Person in whose name the
Corporate Units Certificate evidencing such Purchase Contract is registered at
the close of business on the Record Date for such Payment Date.  Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in New York City.  The Contract Adjustment Payments will be payable, at the
option of the Company, by check mailed to the address of the Person entitled
thereto at such Person’s address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.

     

     

    The
Purchase Contracts and all obligations and rights of the Company and the Holders
thereunder, including, without limitation, the rights of the Holders to receive
and the obligation of the Company to pay any Contract Adjustment Payments, shall
immediately and automatically terminate, without the necessity of any notice or
action by any Holder, the Purchase Contract Agent or the Company, if, on or
prior to the Purchase Contract Settlement Date, a Termination Event shall have
occurred.  Upon the occurrence of a Termination Event, the Company shall
promptly but in no event later than two Business Days thereafter give written
notice to the Purchase Contract Agent, the Collateral Agent and the Holders, at
their addresses as they appear in the Security Register.  Upon and after
the occurrence of a Termination Event, the Collateral Agent shall release the
Pledged Senior Notes or the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) (as defined in the
Pledge Agreement) in the Treasury Portfolio, as the case may be, from the Pledge
in accordance with the provisions of the Pledge Agreement.  A Corporate
Unit shall thereafter represent the right to receive the Senior Note or the
appropriate Applicable Ownership Interests in the Treasury Portfolio forming a
part of such Corporate

     

    
      
        A-9

      

      
        
        

        
          

        

      

      
        
        

      

    

    Unit in
accordance with the terms of, and except as set forth in, the Purchase Contract
Agreement and the Pledge Agreement.

     

     

    Subject
to and upon compliance with the provisions of the Purchase Contract Agreement,
at the option of the Holder thereof, Purchase Contracts underlying Units may be
settled early (“Early
Settlement”) at any time on or prior to 5:00 p.m. (New York City time) on
the seventh Business Day immediately preceding the Purchase Contract Settlement
Date as provided in the Purchase Contract Agreement.  In order to exercise
the right to effect Early Settlement with respect to any Purchase Contract
evidenced by this Certificate, the Holder of this Corporate Units Certificate
shall deliver to the Purchase Contract Agent at the Corporate Trust Office prior
to the time specified in the Purchase Contract Agreement an Election to Settle
Early form set forth below duly completed and accompanied by payment in the form
of immediately available funds payable to the order of the Company in an amount
(the “Early Settlement
Amount”) equal to the sum of:

     

     

    (i)           
the product of (A) the Stated Amount times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Early Settlement,
plus

     

     

    (ii)           if
such delivery is made with respect to any Purchase Contracts during the period
from the close of business on any Record Date next preceding any Payment Date to
the opening of business on such Payment Date, an amount equal to the Contract
Adjustment Payments payable on such Payment Date with respect to such Purchase
Contracts.

     

     

    Upon
Early Settlement of Purchase Contracts by a Holder of the related Units, the
Pledged Senior Notes or Pledged Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) underlying such Units shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of newly issued shares of Common Stock
adjusted in the same manner and at the same time as the Settlement Rate is
adjusted (the “Early Settlement
Rate”).

     

     

    Upon the
occurrence of a Cash Merger, a Holder of Corporate Units may effect Cash Merger
Early Settlement of the Purchase Contract underlying such Corporate Units
pursuant to the terms of Section 5.04(b)(ii) of the
Purchase Contract Agreement.  Upon Cash Merger Early Settlement of Purchase
Contracts by a Holder of the related Corporate Units, the Pledged Senior Notes
or Pledged Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio underlying such Corporate
Units shall be released from the Pledge as provided in the Pledge
Agreement.

     

     

    Upon
registration of transfer of this Corporate Units Certificate, the transferee
shall be bound (without the necessity of any other action on the part of such
transferee, except as may be required by the Purchase Contract Agent pursuant to
the Purchase Contract Agreement), under the terms of the Purchase Contract
Agreement and the Purchase Contracts evidenced hereby and the transferor shall
be released from the obligations under the Purchase Contracts evidenced by this
Corporate Units Certificate.  The Company covenants and agrees, and the
Holder, by its acceptance hereof, likewise covenants and agrees, to be bound by
the provisions of this paragraph.

     

     

    The
Holder of this Corporate Units Certificate, by its acceptance hereof,
irrevocably authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts forming part of the Corporate Units evidenced hereby
on its behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform its obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, irrevocably
authorizes the Purchase Contract Agent to enter into and perform the Purchase
Contract Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact, and consents to, and agrees to be bound by, the Pledge of such
Holder’s right, title and interest in and to the Collateral Account, including
the Senior Notes or the appropriate Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio, as the
case may be, underlying this Corporate Units Certificate pursuant to the Pledge
Agreement.  The Holder further covenants and agrees that, to the extent and
in the manner provided in the Purchase Contract Agreement and the Pledge
Agreement, but subject to the terms thereof, payments with respect to the

     

    
      
        A-10

      

      
        
        

        
          

        

      

      
        
        

      

    

    aggregate
principal amount of the Pledged Senior Notes or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, on the Purchase Contract
Settlement Date shall be paid by the Collateral Agent to the Company in
satisfaction of such Holder’s obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.

     

     

    Subject
to certain exceptions, the provisions of the Purchase Contract Agreement may be
amended with the consent of the Holders of a majority of the Purchase
Contracts.

     

     

    The
Purchase Contracts shall be governed by, and construed in accordance with, the
laws of the State of New York.

     

     

    Prior to
due presentment of this Certificate for registration of transfer, the Company,
the Purchase Contract Agent and its Affiliates and any agent of the Company or
the Purchase Contract Agent may treat the Person in whose name this Corporate
Units Certificate is registered as the owner of the Corporate Units evidenced
hereby for the purpose of receiving payments of interest payable on the Senior
Notes, receiving payments of Contract Adjustment Payments (subject to any
applicable record date), performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and neither the Company, the
Purchase Contract Agent nor any such agent shall be affected by notice to the
contrary.

     

     

    The
Purchase Contracts shall not, prior to the settlement thereof, entitle the
Holder to any of the rights of a holder of shares of Common Stock or Preferred
Stock, as applicable.

     

     

    A copy of
the Purchase Contract Agreement is available for inspection at the offices of
the Purchase Contract Agent.

     

    

    
      
        
          A-11

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    ABBREVIATIONS

     

     

    The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

     

     

    TEN
COM:                                                      
as tenants in common

     

     

    UNIF GIFT
MIN
ACT:                                    
______________ Custodian _____________

     

                                                                                    
(cust)                                    
(minor)

     

     

    Under
Uniform Gifts to Minors Act of

     

     

                                                                  

     

     

    TENANT:                                                       
as tenants by the entireties

     

     

    
      	
              JT
      TEN:                                                          
      as joint tenants with right of survivorship and not as tenants in
      common

            

    

     

     

    Additional
abbreviations may also be used though not in the above list.

     

     

    FOR VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto

     

     

                                                                                                                                                   

     

     

                                                                                                                                                   

     

               (Please insert Social
Security or Taxpayer I.D. or other Identifying Number of Assignee)

     

     

                                                                                                                                                   

     

     

                                                                                                                                                   

     

                (Please print or type
name and address including Postal Zip Code of Assignee)

     

     

    the
within Corporate Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney __________________, to transfer
said Corporate Units Certificates on the books of PNM Resources, Inc., with full
power of substitution in the premises.

     

     

    Dated:                                                             
Signature                                                         

     

    

     

     

    NOTICE:
 The signature to this assignment must correspond with the name as it
appears upon the face of the within Corporate Units Certificates in every
particular, without alteration or enlargement or any change
whatsoever.

     

     

    Signature
Guarantee:                                                                            

     

    
      
        
          A-12

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    SETTLEMENT
INSTRUCTIONS

     

     

    The
undersigned Holder directs that a certificate for shares of [Common Stock]
[Preferred Stock] deliverable upon settlement on or after the Purchase Contract
Settlement Date of the Purchase Contracts underlying the number of Corporate
Units evidenced by this Corporate Units Certificate be registered in the name
of, and delivered, together with a check in payment for any fractional share, to
the undersigned at the address indicated below unless a different name and
address have been indicated below.  If shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.

     

     

    Date:
                          
                                   
                                                                       

     

                                                               
Signature  

     

     

                                                                           
Signature Guarantee:                                        

     

                                                                           
(if assigned to another person)

     

    
      	
              If
      shares are to be registered in the name of and delivered to a Person other
      than the Holder, please (i) print such Person’s name and address and (ii)
      provide a guarantee of your signature:

            	
              REGISTERED
      HOLDER

               

              Please
      print name and address of Registered
Holder:

            

    

     

    
      	
                                                    
                       
                                    

              Name                                                                             
      

            	
                                        
                       
                                        

              Name                                                                       
      

            
	
                                                                                    
                      

              Address                                                                        

            	
                                                                                              

              Address                                                                 
      

            
	
                             
                                                                             

            	
                                                                              
                     

            
	

                             
                                                                             

            	

                                                                                               

            
	
                                                                                           
               

            	
                                                                               
          
               

            
	
              Social
      Security or other Taxpayer Identification Number, if any

            	 
      

    

    
      
        
          A-13

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    ELECTION
TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT

     

     

    The
undersigned Holder of this Corporate Units Certificate hereby irrevocably
exercises the option to effect [Early Settlement] [Cash Merger Early Settlement
following a Cash Merger] in accordance with the terms of the Purchase Contract
Agreement with respect to the Purchase Contracts underlying the number of
Corporate Units evidenced by this Corporate Units Certificate specified
below.  The undersigned Holder directs that a certificate for shares of
[Common Stock] [Preferred Stock] or other securities deliverable upon such
[Early Settlement] [Cash Merger Early Settlement] be registered in the name of,
and delivered, together with a check in payment for any fractional share and any
Corporate Units Certificate representing any Corporate Units evidenced hereby as
to which [Early Settlement] [Cash Merger Early Settlement] of the related
Purchase Contracts is not effected, to the undersigned at the address indicated
below unless a different name and address have been indicated below. 
Pledged Senior Notes or the appropriate Applicable Ownership Interests in the
Treasury Portfolio, as the case may be, deliverable upon such [Early Settlement]
[Cash Merger Early Settlement] will be transferred in accordance with the
transfer instructions set forth below.  If shares are to be registered in
the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.

     

     

    Dated:
                                                            
Signature                                                         

     

     

    Signature
Guarantee:                                                       

     

    

    
      
        
          A-14

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    Number of
Units evidenced hereby as to which [Early Settlement] [Cash Merger Early
Settlement] of the related Purchase Contracts is being elected:

     

    
      	
              If
      shares of [Common Stock] [Preferred Stock] or Corporate Units Certificates
      are to be registered in the name of and delivered to and Pledged Senior
      Notes or the Applicable Ownership Interests in the Treasury Portfolio, as
      the case may be, are to be transferred to a Person other than the Holder,
      please print such Person’s name and address:

            	
              REGISTERED
      HOLDER

               

              Please
      print name and address of Registered Holder:

            
	
                                                                                     

              Name                                                             
      

            	
                                                                                     

              Name                                                               
      

            
	
                                                                                     

              Address                          
                                     
      

            	
                                                                                      

              Address                         
                                     
      

            
	
                                                                                                       

            	
                                                 
             
                                   

            
	
                                                                                                    

            	
                                                      
         
                                  

            
	
                                                                                        

            	
                                                      
           
                                

            
	
              Social
      Security or other Taxpayer Identification Number, if any

            	   
      

    

     

    Transfer
Instructions for Pledged Senior Notes or the Applicable Ownership Interests in
the Treasury Portfolio, as the case may be, transferable upon [Early Settlement]
[Cash Merger Early Settlement] or a Termination Event:

     

     

                                                                                                                                                            

     

     

                                                                                                                                                            

     

     

                                                                                                                                                            

     

    

    
      
        
          A-15

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    EXHIBIT
B

     

     

    THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES
ACT”), AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.  EACH PURCHASER OF
ANY OF THESE SECURITIES IS HEREBY NOTIFIED THAT THE SELLER OF ANY OF THESE
SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

     

     

    THESE
SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)
(1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
ACQUIRING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A (IF AVAILABLE), (2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE), (3) TO AN ACCREDITED INVESTOR WITHIN THE
MEANING OF RULE 501(a) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT (IF AVAILABLE) OR (4)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND
(B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.

     

     

    IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE PURCHASE CONTRACT
AGENT SUCH OPINIONS OF COUNSEL, CERTIFICATES AND/OR OTHER INFORMATION AS IT MAY
REASONABLY REQUIRE IN FORM REASONABLY SATISFACTORY TO IT AS PROVIDED FOR IN THE
INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS
AS PROVIDED FOR IN THE INDENTURE.

     

     

    (FORM OF
FACE OF TREASURY UNIT CERTIFICATE)

     

     

    No.
_______                                 

     

    

    Number of
Treasury Units: ______

     

     

    PNM
RESOURCES, INC.

    Treasury
Units

     

     

    This
Treasury Units Certificate certifies that ______________ is the registered
Holder of the number of Treasury Units set forth above.  Each Treasury Unit
consists of (i) a 1/40th, or
2.5%, undivided beneficial ownership interest of a Treasury Security having a
principal amount at maturity equal to $1,000, subject to the Pledge of such
Treasury Security by such Holder pursuant to the Pledge Agreement, and (ii) the
rights and obligations of the Holder under one Purchase Contract with PNM
Resources, Inc., a  New Mexico corporation (the “Company”).  All
capitalized terms used herein which are defined in the Purchase Contract
Agreement (as defined on the reverse hereof) have the meaning set forth
therein.

     

     

    Pursuant
to the Pledge Agreement, the Treasury Securities constituting part of each
Treasury Unit evidenced hereby have been pledged to the Collateral Agent, for
the benefit of the Company, to secure the obligations of the Holder under the
Purchase Contract comprising part of such Treasury Unit.

     

     

    Each
Purchase Contract evidenced hereby obligates the Holder of this Treasury Units
Certificate to purchase, and the Company, to sell, on November 16, 2008 (the
“Purchase Contract Settlement
Date”), at a price equal to $25 (the “Purchase Price”), a number of
newly issued shares of common stock, no par value, (“Common 

     

    
      
        B-1

      

      
        
        

        
          

        

      

      
        
        

      

    

    Stock”) (or, under certain
circumstances, one-tenth as many newly issued shares of Convertible Preferred
Stock, Class A (“Preferred
Stock”)), of the Company, equal to the Settlement Rate, unless prior to
or on the Purchase Contract Settlement Date there shall have occurred a
Termination Event, an Early Settlement or a Cash Merger Early Settlement with
respect to such Purchase Contract, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof.  The Purchase
Price, if not paid earlier, shall be paid on the Purchase Contract Settlement
Date by application of the proceeds from the Treasury Securities at maturity
pledged to secure the obligations of the Holder under such Purchase Contract of
the Treasury Units of which such Purchase Contract is a part.

     

     

    Each
Purchase Contract evidenced hereby obligates the holder to agree, for United
States federal, state and local income and franchise tax purposes, to (i) treat
an acquisition of the Treasury Units as an acquisition of the Treasury
Securities and Purchase Contracts constituting the Treasury Units and (ii) treat
itself as owner of the applicable interest in the Collateral Account, including
the Treasury Securities.

     

     

    The
Company shall pay, on each Payment Date, in respect of each Purchase Contract
forming part of a Treasury Unit evidenced hereby, an amount (the “Contract Adjustment
Payments”) equal to 1.525% per year of the Stated Amount.  Such
Contract Adjustment Payments shall be payable to the Person in whose name this
Treasury Units Certificate is registered at the close of business on the Record
Date for such Payment Date.

     

     

    Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in New York City.  The Contract Adjustment Payments will be payable, at the
option of the Company, by check mailed to the address of the Person entitled
thereto at such Person’s address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.

     

     

    Reference
is hereby made to the further provisions 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 Purchase
Contract Agent by manual signature, this Treasury Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.

     

    
      
        
          B-2

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    IN
WITNESS WHEREOF, the Company and the Holder specified above have caused this
instrument to be duly executed.

     

    PNM
RESOURCES, INC.

     

     

    By:                                                                  

    Name:

    Title:

     

     

    HOLDER
SPECIFIED ABOVE (as to obligations of such Holder under the Purchase
Contracts)

     

    
                                      By:   
U.S. BANK NATIONAL ASSOCIATION, not individually but solely as attorney-in-fact
or such Holder

    

     

     

     

    By:                                                                  

    Name:

    Title:

     

     

    Dated:
                                    

     

    
      
        
          B-3

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    CERTIFICATE
OF AUTHENTICATION OF

    PURCHASE
CONTRACT AGENT

     

     

    This is
one of the Treasury Units referred to in the within-mentioned Purchase Contract
Agreement.

     

    
      	
               
      

            	
              U.S.
      BANK NATIONAL ASSOCIATION,

            

    

    
      	
               
      

            	
              as
      Purchase Contract Agent

            

    

     

     

    By:
                                                                 

               
Name:                                                 

               
Title:                                                    

     

     

    Date:
_______________________

     

    

    
      
        
          B-4

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    (FORM OF
REVERSE OF TREASURY UNIT CERTIFICATE)

     

     

    Each
Purchase Contract evidenced hereby is governed by an Amended and Restated
Purchase Contract Agreement, dated as of August 4, 2008 (as may be
supplemented from time to time, the “Purchase Contract Agreement”)
between the Company and U.S. Bank National Association, as Purchase Contract
Agent (including its successors thereunder, herein called the “Purchase Contract Agent”), to
which the Purchase Contract Agreement and supplemental agreements thereto
reference, is hereby made for a description of the respective rights,
limitations of rights, obligations, duties and immunities thereunder of the
Purchase Contract Agent, the Company and the Holders and of the terms upon which
the Treasury Units Certificates are, and are to be, executed and
delivered.

     

     

    Each
Purchase Contract evidenced hereby obligates the Holder of this Treasury Units
Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to $25 (the “Purchase Price”) a number of
newly issued shares of Common Stock (subject to Sections 5.08 and 5.09) equal to the Settlement
Rate (or, under certain circumstances, one-tenth as many shares of Preferred
Stock), unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred.  The “Settlement Rate” is equal
to:

     

     

    (1)       
if the Adjusted Applicable Market Value (as defined below) is greater than or
equal to $25.116 (the “Threshold Appreciation
Price”), 0.9954 shares of Common Stock per Purchase Contract (such number
of shares, as adjusted from time to time pursuant to Section 5.04, the “Minimum Share
Number”);

     

     

    (2)       
if the Adjusted Applicable Market Value is less than the Threshold Appreciation
Price but greater than $20.93 (the “Reference Price”), the number
of shares of Common Stock per Purchase Contract having a value equal to the
Stated Amount divided by the Adjusted Applicable Market Value; and

     

     

    (3)       
if the Adjusted Applicable Market Value is less than or equal to the Reference
Price, 1.1945 shares of Common Stock per Purchase Contract (such number of
shares, as adjusted from time to time pursuant to Section 5.04, the “Maximum Share
Number”),

     

     

    in each
case subject to adjustment as provided in the Purchase Contract Agreement (and
in each case rounded upward or downward to the nearest 1/10,000th of a
share).

     

     

    No
fractional shares of Common Stock or Preferred Stock, as applicable, will be
issued upon settlement of Purchase Contracts, as provided in Section 5.09 of the Purchase
Contract Agreement.

     

     

    Each
Purchase Contract evidenced hereby, which is settled through Early Settlement or
Cash Merger Early Settlement shall obligate the Holder of the related Treasury
Units to purchase at the Purchase Price, and the Company to sell, a number of
newly issued shares of Common Stock (subject to Sections 5.08 and 5.09) equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).

     

     

    The “Adjusted Applicable Market
Value” means (i) prior to any adjustment pursuant to paragraph (i), (ii),
(iii), (iv), (v), (vi), (vii) or (x) of Section 5.04(a) of the
Purchase Contract Agreement, the Applicable Market Value, and (ii) at the time
of and after any adjustment of the Fixed Settlement Rate pursuant to paragraph
(i), (ii), (iii), (iv), (v), (vi), (vii) or (x) of Section 5.04(a) of the
Purchase Contract Agreement, the Applicable Market Value multiplied by a
fraction, the numerator of which shall be the Fixed Settlement Rate immediately
after such adjustment pursuant to paragraph (i), (ii), (iii), (iv), (v), (vi),
(vii) or (x) of Section 5.04(a)
of the Purchase Contract Agreement and the denominator of which shall be
the Fixed Settlement Rate immediately prior to such adjustment; provided, however, that if such
adjustment to the Fixed Settlement Rate is required to be made pursuant to the
occurrence of any of the events contemplated by paragraph (i), (ii), (iii),
(iv), (v),

     

     

    
      
        
          B-5

        

      

      
        
        

        
          

        

      

      
        
        

      

    

     (vi),
(vii) or (x) of Section
5.04(a) of the Purchase Contract Agreement during the period taken into
consideration for determining the Applicable Market Value, appropriate and
customary adjustments shall be made to the Fixed Settlement Rate.

     

     

    The “Applicable Market Value”
means the average of the Closing Price per share of Common Stock on each of the
20 consecutive Trading Days ending on the third Trading Day immediately
preceding the Purchase Contract Settlement Date.

     

     

    The “Closing Price” per share of
Common Stock on any date of determination means:

     

     

    (1)    
the closing sale price as of the close of the principal trading session (or, if
no closing price is reported, the last reported sale price) per share on the New
York Stock Exchange, Inc. (the “NYSE”) on such
date;

     

     

    (2)    
if Common Stock is not listed for trading on the NYSE on any such date, the
closing sale price (or, if no closing price is reported, the last reported sale
price) per share as reported in the composite transactions for the principal
United States national or regional securities exchange on which Common Stock is
so listed;

     

     

    (3)    
if Common Stock is not so listed on a United States national or regional
securities exchange, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization; or

     

     

    (4)    
if the bid price referred to above is not available, the market value of Common
Stock on such date as determined by a nationally recognized independent
investment banking firm retained by the Company for purposes of determining the
Closing Price.

     

     

    A “Trading Day” means a day on
which Common Stock (1) is not suspended from trading on any national or regional
securities exchange or association or over-the-counter market at the close of
business and (2) has traded at least once on the national or regional securities
exchange or association or over-the-counter market that is the primary market
for the trading of Common Stock.

     

     

    In
accordance with the terms of the Purchase Contract Agreement, the Holder of this
Treasury Unit shall pay the Purchase Price for the shares of the Common Stock or
Preferred Stock, as applicable, purchased pursuant to each Purchase Contract
evidenced hereby either by effecting an Early Settlement or, if applicable, a
Cash Merger Early Settlement of each such Purchase Contract or by applying a
principal amount of the Pledged Treasury Securities underlying such Holder’s
Treasury Unit equal to the Stated Amount of such Purchase Contract to the
purchase of the Common Stock or Preferred Stock, as applicable.  A Holder
of Treasury Units who (1) on or prior to 5:00 p.m. (New York City time) on the
seventh Business Day prior to the Purchase Contract Settlement Date, does not
make an effective Early Settlement or (2) on or prior to 5:00 p.m. (New York
City time) on the seventh Business Day prior to the Purchase Contract Settlement
Date, does not make an effective Cash Merger Early Settlement, shall pay the
Purchase Price for the shares of Common Stock or Preferred Stock, as applicable,
to be issued under the related Purchase Contract from the proceeds of the
Pledged Treasury Securities.

     

     

    The
Company shall not be obligated to issue any shares of Common Stock or Preferred
Stock, as applicable, in respect of a Purchase Contract or deliver any
certificates therefor to the Holder unless it shall have received payment of the
aggregate purchase price for the shares of Common Stock or Preferred Stock, as
applicable, to be purchased thereunder in the manner set forth in the Purchase
Contract Agreement.

     

     

    The
Treasury Units Certificates are issuable only in registered form and only in
denominations of a single Treasury Unit and any integral multiple thereof. 
The transfer of any Treasury Units Certificate will be registered and Treasury
Units Certificates may be exchanged as provided in the Purchase Contract
Agreement.  The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement.  No service charge shall be required for
any such registration of 

     

    
      
        B-6

      

      
        
        

        
          

        

      

      
        
        

      

    

    transfer
or exchange, but the Company and the Purchase Contract Agent may require payment
of a sum sufficient to cover any tax or other governmental charge payable in
connection therewith.  A Holder who elects to substitute Senior Notes or
Applicable Ownership Interests in the Treasury Portfolio, for Treasury
Securities, thereby recreating Corporate Units, shall be responsible for any
fees or expenses associated therewith.  Except as provided in the Purchase
Contract Agreement, for so long as the Purchase Contract underlying a Treasury
Unit remains in effect, such Treasury Unit shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Treasury
Unit in respect of the Treasury Security and the Purchase Contract constituting
such Treasury Unit may be transferred and exchanged only as a Treasury
Unit.

     

     

    Unless
the Treasury Portfolio has replaced the Senior Notes as a component of the
Corporate Units and subject to the conditions set forth in the Purchase Contract
Agreement, a Holder of Treasury Units may recreate, at any time on or prior to
5:00 p.m. (New York City time) on the seventh Business Day immediately preceding
the Purchase Contract Settlement Date, Corporate Units by delivering to the
Securities Intermediary Senior Notes with an aggregate principal amount, equal
to the aggregate principal amount at maturity of the Pledged Treasury Securities
in exchange for the release of such Pledged Treasury Securities in accordance
with the terms of the Purchase Contract Agreement and the Pledge
Agreement.  From and after such substitution, the Holder’s Units shall be
referred to as a “Corporate
Unit”.  Any such creation of Corporate Units may be effected only in
multiples of 40 Treasury Units for 40 Corporate Units.

     

     

    If the
Treasury Portfolio has replaced the Senior Notes as a component of the Corporate
Units, a Holder may, at any time on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, substitute Treasury
Securities for the Applicable Ownership Interests in the Treasury Portfolio, but
only in integral multiples of 4,000 Treasury Units.  In such an event, the
Holder shall transfer Treasury Securities to the Collateral Agent, and the
Purchase Contract Agent shall instruct the Collateral Agent to release the
Pledge of and transfer to the Holder the appropriate Applicable Ownership
Interests in the Treasury Portfolio.

     

     

    The
Company shall pay, on each Payment Date, the Contract Adjustment Payments
payable in respect of each Purchase Contract to the Person in whose name the
Treasury Units Certificate evidencing such Purchase Contract is registered at
the close of business on the Record Date for such Payment Date.  Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in New York City.  The Contract Adjustment Payments will be payable, at the
option of the Company, by check mailed to the address of the Person entitled
thereto at such Person’s address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.

     

     

    The
Purchase Contracts and all obligations and rights of the Company and the Holders
thereunder, including, without limitation, the rights of the Holders to receive
and the obligation of the Company to pay any Contract Adjustment Payments, shall
immediately and automatically terminate, without the necessity of any notice or
action by any Holder, the Purchase Contract Agent or the Company, if, on or
prior to the Purchase Contract Settlement Date, a Termination Event shall have
occurred.  Upon the occurrence of a Termination Event, the Company shall
promptly but in no event later than two Business Days thereafter give written
notice to the Purchase Contract Agent, the Collateral Agent and the Holders, at
their addresses as they appear in the Security Register.  Upon and after
the occurrence of a Termination Event, the Collateral Agent shall release the
Pledged Treasury Securities (as defined in the Pledge Agreement) in accordance
with the provisions of the Pledge Agreement.  A Treasury Unit shall
thereafter represent the right to receive the interest in the Treasury Security
forming a part of such Treasury Unit, in accordance with the terms of and except
as set forth in, the Purchase Contract Agreement and the Pledge
Agreement.

     

     

    Subject
to and upon compliance with the provisions of the Purchase Contract Agreement,
at the option of the Holder thereof, Purchase Contracts underlying Units may be
settled early (“Early
Settlement”) as provided in the Purchase Contract Agreement.  In
order to exercise the right to effect Early Settlement with respect to any
Purchase Contract evidenced by this Certificate, the Holder of this Treasury
Units Certificate shall deliver to the Purchase Contract Agent at the Corporate
Trust Office an Election to Settle Early form set forth below duly completed and
accompanied by payment in the form of immediately available funds payable to the
order of the Company in an amount (the “Early Settlement Amount”)
equal to the sum of:

     

    
      
        B-7

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (i)        
the product of (A) the Stated Amount times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Early Settlement,
plus

     

     

    (ii)       
if such delivery is made with respect to any Purchase Contracts during the
period from the close of business on any Record Date next preceding any Payment
Date to the opening of business on such Payment Date, an amount equal to the
Contract Adjustment Payments payable on such Payment Date with respect to such
Purchase Contracts.

     

     

    Upon
Early Settlement of Purchase Contracts by a Holder of the related Units, the
Pledged Treasury Securities underlying such Units shall be released from the
Pledge as provided in the Pledge Agreement and the Holder shall be entitled to
receive a number of newly issued shares of Common Stock adjusted in the same
manner and at the same time as the Settlement Rate is adjusted (the “Early Settlement
Rate”).

     

     

    Upon the
occurrence of a Cash Merger, a Holder of Treasury Units may effect Cash Merger
Early Settlement of the Purchase Contract underlying such Treasury Units
pursuant to the terms of Section 5.04(b)(ii) of the
Purchase Contract Agreement.  Upon Cash Merger Early Settlement of Purchase
Contracts by a Holder of the related Treasury Units, the Pledged Treasury
Securities underlying such Treasury Units shall be released from the Pledge as
provided in the Pledge Agreement.

     

     

    Upon
registration of transfer of this Treasury Units Certificate, the transferee
shall be bound (without the necessity of any other action on the part of such
transferee, except as may be required by the Purchase Contract Agent pursuant to
the Purchase Contract Agreement), under the terms of the Purchase Contract
Agreement and the Purchase Contracts evidenced hereby and the transferor shall
be released from the obligations under the Purchase Contracts evidenced by this
Treasury Units Certificate.  The Company covenants and agrees, and the
Holder, by its acceptance hereof, likewise covenants and agrees, to be bound by
the provisions of this paragraph.

     

     

    The
Holder of this Treasury Units Certificate, by its acceptance hereof, authorizes
the Purchase Contract Agent to enter into and perform the related Purchase
Contracts forming part of the Treasury Units evidenced hereby on its behalf as
its attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
its obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Purchase Contract Agent to enter
into and perform the Purchase Contract Agreement and the Pledge Agreement on its
behalf as its attorney-in-fact, and consents to the Pledge of the Treasury
Securities underlying this Treasury Units Certificate pursuant to the Pledge
Agreement.  The Holder further covenants and agrees, that, to the extent
and in the manner provided in the Purchase Contract Agreement and the Pledge
Agreement, but subject to the terms thereof, payments in respect to the
aggregate principal amount of the Pledged Treasury Securities on the Purchase
Contract Settlement Date shall be paid by the Collateral Agent to the Company in
satisfaction of such Holder’s obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.

     

     

    Subject
to certain exceptions, the provisions of the Purchase Contract Agreement may be
amended with the consent of the Holders of a majority of the Purchase
Contracts.

     

     

    The
Purchase Contracts shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.

     

     

    Prior to
due presentment of this Certificate for registration or transfer, the Company,
the Purchase Contract Agent and its Affiliates and any agent of the Company or
the Purchase Contract Agent may treat the Person in whose name this Treasury
Units Certificate is registered as the owner of the Treasury Units evidenced
hereby for the purpose of receiving payments of interest on the Treasury
Securities, receiving payments of Contract Adjustment Payments (subject to any
applicable record date), performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and 

     

    
      
        B-8

      

      
        
        

        
          

        

      

      
        
        

      

    

    neither
the Company, the Purchase Contract Agent nor any such agent shall be affected by
notice to the contrary.

     

     

    The
Purchase Contracts shall not, prior to the settlement thereof, entitle the
Holder to any of the rights of a holder of shares of Common Stock or Preferred
Stock, as applicable.

     

     

    A copy of
the Purchase Contract Agreement is available for inspection at the offices of
the Purchase Contract Agent.

     

    

    
      
        
          B-9

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    ABBREVIATIONS

     

     

    The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

     

     

    TEN
COM:                                                      
as tenants in common

     

     

    UNIF GIFT
MIN
ACT:                                  
______________ Custodian _____________

     

                                                                               
    
(cust)                                    
(minor)

     

     

    Under
Uniform Gifts to Minors Act of

     

     

                                                                  

     

     

    TENANT:                                                       
as tenants by the entireties

     

     

    
      	
              JT
      TEN:                                                          
      as joint tenants with right of survivorship and not as tenants in
      common

            

    

     

     

    Additional
abbreviations may also be used though not in the above list.

     

     

    FOR VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto

     

     

                                                                                                                                                   

     

     

                                                                                                                                                   

     

           (Please insert Social Security
or Taxpayer I.D. or other Identifying Number of Assignee)

     

     

                                                                                                                                                   

     

     

                                                                                                                                                   

     

            (Please print or type
name and address including Postal Zip Code of Assignee)

     

     

    the
within Corporate Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney __________________, to transfer
said Corporate Units Certificates on the books of PNM Resources, Inc., with full
power of substitution in the premises.

     

     

    Dated:                                                             
Signature                                                         

     

    

     

     

    NOTICE:
 The signature to this assignment must correspond with the name as it
appears upon the face of the within Corporate Units Certificates in every
particular, without alteration or enlargement or any change
whatsoever.

     

     

    Signature
Guarantee:                                                                            

     

    
      
        
          B-10

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    SETTLEMENT
INSTRUCTIONS

     

     

    The
undersigned Holder directs that a certificate for shares of [Common Stock]
[Preferred Stock] deliverable upon settlement on or after the Purchase Contract
Settlement Date of the Purchase Contracts underlying the number of Treasury
Units evidenced by this Treasury Units Certificate be registered in the name of,
and delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below.  If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.

     

     

    Dated:
                                    

     

    
      	
              If
      shares are to be registered in the name of and delivered to a Person other
      than the Holder, please (i) print such Person’s name and address and (ii)
      provide a guarantee of your signature:

            	
              REGISTERED
      HOLDER

               

              Please
      print name and address of Registered Holder:

            
	
                                                                                     

              Name

            	
                                                                                     

              Name

            
	
                                                                                     

              Address

            	
                                                                                     

              Address

            
	
                                                                                     

            	
                                                                                     

            
	
                                                                                     

            	
                                                                                     

            
	
                                                                                     

            	
                                                                                     

            
	
              Social
      Security or other Taxpayer Identification Number, if any

            	 
      

    

    
      
        
          B-11

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    ELECTION
TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT

     

     

    The
undersigned Holder of this Treasury Units Certificate hereby irrevocably
exercises the option to effect [Early Settlement] [Cash Merger Early Settlement
upon a Cash Merger] in accordance with the terms of the Purchase Contract
Agreement with respect to the Purchase Contracts underlying the number of
Treasury Units evidenced by this Treasury Units Certificate specified
below.  The option to effect [Early Settlement] [Cash Merger Early
Settlement] may be exercised only with respect to Purchase Contracts underlying
Treasury Units with an aggregate Stated Amount equal to $___ or an integral
multiple thereof.  The undersigned Holder directs that a certificate for
shares of [Common Stock] [Preferred Stock] or other securities deliverable upon
such [Early Settlement] [Cash Merger Early Settlement] be registered in the name
of, and delivered, together with a check in payment for any fractional share and
any Treasury Units Certificate representing any Treasury Units evidenced hereby
as to which Cash Merger Early Settlement of the related Purchase Contracts is
not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below.  Pledged Treasury
Securities deliverable upon such [Early Settlement] [Cash Merger Early
Settlement] will be transferred in accordance with the transfer instructions set
forth below.  If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.

     

     

    Dated:
                                                            
Signature                                                         

     

     

    Signature
Guarantee:                                                       

     

    

    
      
        
          B-12

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    Number of
Units evidenced hereby as to which [Early Settlement] [Cash Merger Early
Settlement] of the related Purchase Contracts is being elected:

     

    
      	
              If
      shares of [Common Stock] [Preferred Stock] or Corporate Units Certificates
      are to be registered in the name of and delivered to and Pledged Senior
      Notes or the Applicable Ownership Interests in the Treasury Portfolio, as
      the case may be, are to be transferred to a Person other than the Holder,
      please print such Person’s name and address:

            	
              REGISTERED
      HOLDER

               

              Please
      print name and address of Registered Holder:

            
	
                                                                                     

              Name

            	
                                                                                     

              Name

            
	
                                                                                     

              Address

            	
                                                                                     

              Address

            
	
                                                                                     

            	
                                                                                     

            
	
                                                                              
                   

            	
                                                                                     

            
	
                                                                                     

            	
                                                                                     

            
	
              Social
      Security or other Taxpayer Identification Number, if any

            	 
      

    

     

    Transfer
Instructions for Pledged Treasury Securities Transferable upon [Early
Settlement] [Cash Merger Early Settlement] or a Termination Event:

     

     

                                                                                                                                                               

     

     

                                                                                                                                                               

     

     

                                                                                                                                                               

     

    
      
        
          B-13

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
C

     

    INSTRUCTION
TO PURCHASE CONTRACT AGENT

     

     

    U.S. Bank
National Association,

      as
Purchase Contract Agent

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

     

    
      	
               
      

            	
              Re:      
      [_________ Corporate Units] [_________ Treasury Units] of PNM Resources,
      Inc. a New Mexico corporation (the “Company”).

            

    

     

     

    The
undersigned Holder hereby notifies you that it has delivered to U.S. Bank
National Association, as Securities Intermediary, for credit to the Collateral
Account, $_____ aggregate principal amount of [Senior Notes] [Treasury
Securities] in exchange for the [Pledged Senior Notes] [Pledged Treasury
Securities] [Pledged Applicable Ownership Interest] held in the Collateral
Account, in accordance with the Amended and Restated Pledge Agreement, dated
August 4, 2008 (the “Pledge Agreement”; unless
otherwise defined herein, terms defined in the Pledge Agreement are used herein
as defined therein), between you, the Company, the Collateral Agent, the
Custodial Agent and the Securities Intermediary.  The undersigned Holder
has paid all applicable fees and expenses relating to such exchange.  The
undersigned Holder hereby instructs you to instruct the Collateral Agent to
release to you on behalf of the undersigned Holder the [Pledged Senior Notes]
[Pledged Treasury Securities] related to such [Corporate Units] [Treasury Units]
[Pledged Applicable Ownership Interest].

     

     

    Date:
                                                  
                                                                                   

     

                                                                                    
Signature Guarantee:

     

     

                                                                                                                                                     

     

     

    Please
print name and address of

    Registered
Holder:

     

     

                                                                           
                                                                       

     

    Name                                                                          Social
Security or other Taxpayer

                                                                                       
Identification Number, if any

     

     

    Address

     

     

                                                                           

     

     

                                                                           

     

     

                                                                           

     

    
      
        
          C-1

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    EXHIBIT
D

     

     

    NOTICE
FROM PURCHASE CONTRACT AGENT

     

     

    TO
HOLDERS

     

     

    (Transfer
of Collateral upon Occurrence of a Termination Event)

     

     

    [HOLDER]

     

     

                                                                           

     

     

                                                                           

     

     

    Attention:

     

    Telecopy:
                                

     

     

    
      	
               
      

            	
              Re:      
      [Corporate Units] [Treasury Units] of PNM Resources, Inc., a New Mexico
      corporation (the “Company”)

            

    

     

     

    Please
refer to the Amended and Restated Purchase Contract Agreement, dated as of
August 4, 2008 (the “Purchase Contract Agreement”;
unless otherwise defined herein, terms defined in the Purchase Contract
Agreement are used herein as defined therein), between the Company and the
undersigned, as Purchase Contract Agent and as attorney-in-fact for the holders
of Corporate Units and Treasury Units from time to time.

     

     

    We hereby
notify you that a Termination Event has occurred and that [the Senior Notes]
[Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio] [the Treasury Securities] compromising a
portion of your ownership interest in ______ [Corporate Units] [Treasury Units]
have been released and are being held by us for your account pending receipt of
transfer instructions with respect to such [Senior Notes] [Applicable Ownership
Interests] [Treasury Securities] (the “Released
Securities”).

     

     

    Pursuant
to Section 3.15 of the
Purchase Contract Agreement, we hereby request written transfer instructions
with respect to the Released Securities.  Upon receipt of your instructions
and upon transfer to us of your [Corporate Units][Treasury Units] by delivery to
us of your [Corporate Units Certificate][Treasury Units Certificate], we shall
transfer the Released Securities by appropriate procedures, in accordance with
your instructions.

     

     

    In the
event you fail to effect such transfer or delivery, the Released Securities and
any distributions thereon, shall be held in our name, or a nominee in trust for
your benefit, until such time as such [Corporate Units][Treasury Units] are
transferred or your [Corporate Units Certificate] [Treasury Units Certificate]
is surrendered or satisfactory evidence is provided that such [Corporate Units
Certificate][Treasury Units Certificate] has been destroyed, lost or stolen,
together with any indemnification that we or the Company may
require.

     

    
      	
              Date: 
      

            	
                                                                           
      By: U.S. Bank National Association,

            

    

    
      	
               
      

            	
                                                                                   
      as the Purchase Contract Agent

            

    

     

    By:                                                                  

    Name:

     

    Title:
 Authorized Signatory

     

    
      
        
          D-1

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    EXHIBIT
E

     

     

    NOTICE TO
SETTLE BY CASH

     

     

    U.S. Bank
National Association,

      as
Purchase Contract Agent

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

     

    Re:      
Corporate Units of PNM Resources, Inc., a New Mexico corporation (the “Company”)

     

     

    The
undersigned Holder hereby irrevocably notifies you in accordance with Section 5.02(b) of the Amended
and Restated Purchase Contract Agreement, dated as of August 4, 2008 (the
“Purchase Contract
Agreement”; unless otherwise defined herein, terms defined in the
Purchase Contract Agreement are used herein as defined therein), between the
Company and you, as Purchase Contract Agent and as attorney-in-fact for the
Holders of the Purchase Contracts, that such Holder has elected to pay to the
Securities Intermediary for deposit in the Collateral Account, on or prior to
5:00 p.m. (New York City time) on the sixth Business Day immediately preceding
the Purchase Contract Settlement Date (in lawful money of the United States by
certified or cashiers’ check or wire transfer, in immediately available funds),
$___ as the Purchase Price for the shares of [Common Stock] [Preferred Stock]
issuable to such Holder by the Company with respect to Purchase Contracts on the
Purchase Contract Settlement Date. The undersigned Holder hereby instructs you
to notify promptly the Collateral Agent of the undersigned Holders’ election to
make such Cash Settlement with respect to the Purchase Contracts related to such
Holder’s Corporate Units.

     

     

    Date:
                                                              
Signature                                                         

     

     

        
Signature Guarantee:                                            

     

     

    Please
print name and address of Registered Holder:

     

     

                                                                           

     

     

                                                                           

     

    
      
        
          E-1

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    EXHIBIT
F

     

     

    NOTICE
FROM PURCHASE CONTRACT AGENT

    TO
COLLATERAL AGENT AND INDENTURE TRUSTEE

    (Settlement
of Purchase Contract through Remarketing)

     

     

    U.S. Bank
National Association,

      as
Collateral Agent and Indenture Trustee

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

     

    
      	
               
      

            	
              Re:      
      Corporate Units of PNM Resources, Inc., a New Mexico corporation (the
      “Company”)

            

    

     

     

    Please
refer to the Amended and Restated Purchase Contract Agreement, dated as of
August 4, 2008 (the “Purchase Contract Agreement”;
unless otherwise defined herein, terms defined in the Purchase Contract
Agreement are used herein as defined therein), between the Company and the
undersigned, as Purchase Contract Agent and as attorney-in-fact for the Holders
of Corporate Units from time to time.

     

     

    In
accordance with Section
5.02(b) of the Purchase Contract Agreement and, based on notices of
[Early Settlements] [Cash Settlements] received from Holders of Corporate Units
as of 5:00 p.m. (New York City time), on the seventh Business Day immediately
preceding the Purchase Contract Settlement Date, we hereby notify you that an
aggregate principal amount of $______ Senior Notes are to be tendered for
purchase in the Remarketing.

     

    
      	
              Date:
                                                                    
      By: U.S. Bank National Association,

            

    

    
      	
                                                                                     
              as the Purchase Contract
      Agent

            

    

     

    By:                                                                  

    Name:

     

    Title:
 Authorized Signatory

     

    
      
        
          F-1

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    EXHIBIT
G

     

     

    NOTICE TO
SETTLE BY CASH UPON FAILED FINAL REMARKETING

     

     

    U.S. Bank
National Association,

      as
Purchase Contract Agent

    100 Wall
Street, Suite 1600

    New York,
New York 10005

    Attention: 
Corporate Trust Administration

    Telephone: 
(212) 361-2505

    Telecopy: 
(212) 809-4993

     

     

    Re:      
Corporate Units of PNM Resources, Inc., a New Mexico corporation (the “Company”)

     

     

    The
undersigned Holder hereby irrevocably notifies you in accordance with Section 5.02(c) of the Amended
and Restated Purchase Contract Agreement, dated as of August 4, 2008 (the
“Purchase Contract
Agreement”; unless otherwise defined herein, terms defined in the
Purchase Contract Agreement are used herein as defined therein), between the
Company and you, as Purchase Contract Agent and as attorney-in-fact for the
Holders of the Purchase Contracts, that such Holder has elected to pay to the
Securities Intermediary for deposit in the Collateral Account, on or prior to
5:00 p.m. (New York City time) on the Business Day immediately preceding the
Purchase Contract Settlement Date (in lawful money of the United States by
certified or cashiers’ check or wire transfer, in immediately available funds),
$___ as the Purchase Price for the shares of [Common Stock] [Preferred Stock]
issuable to such Holder by the Company with respect to Purchase Contracts on the
Purchase Contract Settlement Date. The undersigned Holder hereby instructs you
to notify promptly the Collateral Agent of the undersigned Holder’s election to
make such Cash Settlement with respect to the Purchase Contracts related to such
Holder’s Corporate Units.

     

     

    Date:
                                                              
Signature                                                         

     

     

     

    Signature
Guarantee:                                            

     

     

    Please
print name and address of Registered Holder:

     

     

                                                                           

     

     

                                                                           

     

    

    

     

    
      
        
          G-1

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