Document:

Exhibit 10.1

FIRST AMENDMENT TO THE

TUESDAY MORNING CORPORATION

EMPLOYEE STOCK PURCHASE PLAN

 

                THIS FIRST AMENDMENT TO THE TUESDAY MORNING
CORPORATION EMPLOYEE STOCK PURCHASE PLAN (this “Amendment”) is effective as set
forth below and is made by the Compensation Committee (the “Committee”) of
Tuesday Morning Corporation, a Delaware corporation (the “Company”).

PRELIMINARY
STATEMENTS

                A.            The Company has previously established the Tuesday
Morning Corporation Employee Stock Purchase Plan (the “ESPP”), for the benefit
of eligible employees of the Company. 
Capitalized terms used but not otherwise defined herein shall have the
meanings ascribed to them in the ESPP.

                B.            Pursuant to Section 8.1 of the ESPP, the Committee has
the right to make certain amendments to the ESPP.

                C.            The Committee desires to (1) establish a limit on the
number of shares of common stock that can be granted to employees pursuant to
the ESPP and (2) put a limit on the term of the ESPP.

AMENDMENT

                NOW, THEREFORE, the ESPP is
hereby amended as follows, effective September 18, 2007:

                1.  NUMBER OF SHARES; TERM.  Section 4.1 is hereby amended and restated in
its entirety to read as follows:

                “4.1         Number of Shares; Term. 
The number of Shares which the Company may offer to Participants under
the Plan is limited to 250,000 Shares. 
Such Shares shall be purchased in open market transactions.  Unless the Plan is previously suspended or
terminated upon the adoption of a resolution of the Plan Administrators or the
Board of Directors of the Company, purchases under the Plan shall be permitted
with respect to Employee payroll deductions and Company matching contributions
through December 31, 2007.  No Employee
payroll deductions or Company matching contributions shall be made under the
Plan for periods after December 31, 2007. 
After Shares are purchased with contributions made under the Plan for
the month of December 2007, the Plan shall terminate and the Plan Administrator
shall take such actions as are required by Section 8.2 of the Plan.”

 

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                2.  Except as expressly set forth herein, the
ESPP shall remain in full force and effect without further amendment or
modification.

 

[The remainder of
this page is intentionally left blank.]

 

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                IN WITNESS WHEREOF, this
Amendment has been executed by a duly authorized officer of the Company as of
the date specified below and effective as set forth herein.

	
   

  	
  TUESDAY MORNING CORPORATION

  
	
   

  	
   

  
	
  Date:  September
  19, 2007

  	
  By:

  	
  /s/ ELIZABETH
  A. SCHROEDER

  
	
   

  	
  Elizabeth A. Schroeder

  
	
   

  	
  Chief Financial Officer, Secretary and

  
	
   

  	
  Treasurer

  

 

3Exhibit
10.1

EXECUTION COPY

 

October
31, 2007

Constellation Energy Group, Inc.

750 E. Pratt Street

Baltimore, MD 21202

 

Ladies and Gentlemen:

                The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and conditions of the
Transaction entered into between J.P. Morgan Securities Inc., as agent for
JPMorgan Chase Bank, National Association, London Branch (the “Seller”), and Constellation Energy Group, Inc., a Maryland
corporation (the “Purchaser”), on
the Trade Date specified below (the “Transaction”).  This Confirmation constitutes a “Confirmation”
as referred to in the Agreement specified below.  In the event of a conflict between the
Agreement (as defined below) and this Confirmation, the terms of this
Confirmation shall govern.

This
Confirmation evidences a complete and binding agreement between the Seller and
the Purchaser as to the terms of the Transaction to which this Confirmation
relates.  This Confirmation shall
supplement, form a part of, and be subject to an agreement in the form of the
2002 ISDA Master Agreement (the “Agreement”) as
if the Seller and the Purchaser had executed an agreement in such form (but
without any Schedule except for the election of the laws of the State of New
York as the governing law (but without giving regard to its conflicts of law
provisions)) on the Trade Date.  In the
event of any inconsistency between provisions of that Agreement and this
Confirmation, this Confirmation will prevail for the purpose of the Transaction
to which this Confirmation relates.  The
parties hereby agree that no Transaction other than the Transaction to which
this Confirmation relates shall be governed by the Agreement.

ARTICLE 1

DEFINITIONS

Section
1.01.  Definitions. 
(a) As
used in this Confirmation, the following terms shall have the following
meanings:

“10b-18 VWAP” means, (A) for any Trading Day described in
clause (x) of the definition of Trading Day hereunder, the volume-weighted
average price at which the Common Stock trades as reported in the composite
transactions for the principal United States securities exchange on which such
Common Stock is then listed (or, if applicable, the Successor Exchange on which
the Common Stock has been listed in accordance with Section 7.02(b)), on such
Trading Day, excluding (i) trades that do not settle regular way,
(ii) opening (regular way) reported trades in the consolidated system on
such Trading Day, (iii) trades that occur in the last ten minutes before
the scheduled close of trading on the Exchange on such Trading Day and ten
minutes before the scheduled close of the primary trading in the market where
the trade is effected, and (iv) trades on such Trading Day that do not
satisfy the requirements of Rule 10b-18(b)(3), as determined in good faith by
the Calculation Agent, or (B) for any Trading Day that is described in clause
(y) of the definition of Trading Day hereunder, an amount determined in good
faith by the Calculation Agent as 10b-18 VWAP. 
The Purchaser acknowledges that the Seller may refer to the Bloomberg
Page “CEG.N <Equity> AQR SEC” (or any successor thereto), in its
judgment, for such Trading Day to determine the 10b-18 VWAP.

JPMorgan Chase Bank,
National Association

Organised under the laws of
the United States as a National Banking Association.

Main Office 1111 Polaris
Parkway, Columbus, Ohio 43271

Registered as a branch in
England & Wales branch No. BR000746.

Registered Branch Office
125 London Wall, London EC2Y 5AJ

Authorised and regulated by
the Financial Services Authority

 

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“Additional Termination Event” has the meaning set forth in
Section 7.02.

“Agreement” has the meaning set forth in the second paragraph
of this Confirmation.

“Affected Party” has the meaning set forth in Section 14 of
the Agreement.

“Affected Transaction” has the meaning set forth in Section
14 of the Agreement.

“Affiliated Purchaser” means any “affiliated purchaser” (as
such term is defined in Rule 10b-18) of the Purchaser.

“Alternative Termination Delivery Unit” means (i) in the case
of a Termination Event (other than a Merger Event or Nationalization) or Event
of Default (as defined in the Agreement), one share of Common Stock and (ii) in
the case of a Merger Event or Nationalization, a unit consisting of the number
or amount of each type of property received by a holder of one share of Common
Stock in such Merger Event or Nationalization; provided that
if such Merger Event involves a choice of consideration to be received by
holders of the Common Stock, an Alternative Termination Delivery Unit shall be
deemed to include the amount of cash received by a holder who had elected to
receive the maximum possible amount of cash as consideration for his shares.

“Averaging Period” means the period of consecutive Trading
Days from and including the Valuation Commencement Date to and including the
Valuation Completion Date.

“Bankruptcy Code” has the meaning set forth in Section 9.06.

“Business Day” means any day on which the Exchange is open
for trading.

“Calculation Agent” means has the meaning set forth in the
Pricing Supplement.

“Common Stock” has the meaning set forth in Section 2.01.

“Communications Procedures” has the meaning set forth in
Annex A hereto.

“Confirmation” has the meaning set forth in the first
paragraph of this letter agreement.

“Contract Period” means the period commencing on and
including the Trade Date and ending on and including the date all payments or
deliveries of shares of Common Stock pursuant to Article 3 or Section 7.04 have
been made.

“Default Notice Day” has the meaning set forth in Section
7.03(a).

“De-Listing” has the meaning set forth in Section 7.02(b).

“Discount” means the amount specified as such in the Pricing
Supplement.

“Early Termination Date” has the meaning set forth in
Section 14 of the Agreement.

“Event of Default” has the meaning set forth in Section 14 of
the Agreement (except that “Event of Default” shall not include the events set
forth in Sections 5(a)(v) and (vi) of the Agreement).

“Exchange” means the New York Stock Exchange.

“Exchange Act” means the Securities Exchange Act of 1934, as
amended.

“Expiration Date” means the 62nd Trading Day
following the Valuation Commencement Date.

 

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“Extraordinary Cash Dividend” means the per share cash
dividend or distribution, or a portion thereof, declared by the Purchaser on
shares of Common Stock that is classified by the board of directors of the
Purchaser as an “extraordinary” dividend.

“Initial Settlement Date” means November 2. 2007.

“Merger Event” has the meaning set forth in Section 7.02(c).

“Minimum Delivery Number” means the number of shares of
Common Stock, rounded down to the nearest integer, equal to (A) the Purchase
Price divided by (B) the Upside Threshold.

“Nationalization” has the meaning set forth in Section
7.02(d).

“Ordinary Cash Dividend” has the meaning set forth in Section
8.01(b).

“Pricing Supplement” means the Pricing Supplement attached
hereto as Annex B.

“Purchase Price” has the meaning set forth in Section 2.01.

“Purchaser” has the meaning set forth in the first paragraph
of this Confirmation.

“Regulation M” means Regulation M under the Exchange Act.

“Rule 10b-18” means Rule 10b-18 promulgated under the
Exchange Act (or any successor rule thereto).

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as
amended.

“Seller” has the meaning set forth in the first paragraph
hereto.

“Seller Termination Share Purchase Period” has the meaning
set forth in Section 7.04.

“Settlement Number” means the number of shares of Common
Stock equal to (i) the Valuation Number minus (ii) the
Minimum Delivery Number.

“Share Cap” means, for any date, (i) 50% of the authorized
but unissued shares of Common Stock as of the Trade Date, minus (ii) the net number of shares of
Common Stock delivered by the Purchaser to the Seller in respect of this
Transaction on or prior to such date, plus
(iii) the net number of shares of Common Stock delivered by the Seller to the
Purchaser in respect of this Transaction on or prior to such date, subject to
appropriate adjustments pursuant to Section 8.02.

“Share De-listing Event” has the meaning set forth in Section
7.02(b).

“Successor Exchange” has the meaning set forth in Section
7.02(b).

“Termination Amount” shall be the amount determined pursuant
to Section 6 of the Agreement.

“Termination Event” has the meaning set forth in Section 14
of the Agreement (except that “Termination Event” shall not include the event
set forth in Section 5(b)(v) of the Agreement).

“Termination Price” means the value of an Alternative
Termination Delivery Unit to the Seller, as determined by the Calculation
Agent.

 

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“Trade Date” has the meaning set forth in Section 2.01.

“Trading Day” means (x) any day (i) other than a Saturday, a
Sunday or a day on which the Exchange is not open for business, (ii) during
which trading of any securities of the Purchaser on any national securities
exchange has not been suspended, (iii) during which there has not been, in the
Seller’s reasonable judgment, a material limitation in the trading of Common
Stock or any options contract or futures contract related to the Common Stock,
and (iv) during which there has been no suspension pursuant to Section 4.02 of
this Confirmation, or (y) any day that, notwithstanding the occurrence of
events contemplated in clauses (ii), (iii) and (iv) of this definition, the
Calculation Agent determines to be a Trading Day. The Seller shall explain the
basis for any determination made pursuant to clause (iii).

“Transaction” has the meaning set forth in the first
paragraph of this Confirmation.

“Upside Threshold” has the meaning specified as such in the
Pricing Supplement.

“Valuation Commencement Date” means November 2, 2007

“Valuation Completion Date” has the meaning specified as such
in the Pricing Supplement.

“Valuation Number” means the number of shares of Common
Stock, rounded down to the nearest integer, equal to the Purchase Price divided by the Valuation Price; provided,
however, that if such number of shares of Common Stock is less than
the Minimum Delivery Number, the Valuation Number shall be equal to the Minimum
Delivery Number.

“Valuation Price” means the average of the 10b-18 VWAPs for all Trading
Days in the Averaging Period minus the
Discount.

ARTICLE 2

PURCHASE OF THE STOCK

Section
2.01.  Purchase of the Stock. Subject to the terms and conditions of
this Confirmation, the Purchaser agrees to purchase from the Seller, and the
Seller agrees on the date hereof (the “Trade Date”) to
sell to the Purchaser a number of shares of the Purchaser’s common stock, with
no par value per share (“Common Stock”),
for a purchase price equal to $250,000,000.00 (the “Purchase
Price”).  The number of shares
of Common Stock purchased by the Purchaser hereunder shall be determined in
accordance with the terms of this Confirmation.

Section
2.02.  Initial Delivery and
Payments.  On the Initial
Settlement Date, the Seller shall deliver the Minimum Delivery Number to the
Purchaser, upon payment by the Purchaser of an amount equal to the sum of the
Purchase Price to the Seller. Delivery and payment pursuant to this Section
2.02 shall be effected in accordance with the Seller’s customary procedures.

Section
2.03.  Conditions to Seller’s Obligations.  The Seller’s obligation to deliver
the Minimum Delivery Number to the Purchaser on the Initial Settlement Date is
subject to the condition that the representations and warranties made by the
Purchaser in the Agreement shall be true and correct as of the date hereof and
the Initial Settlement Date.

 

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ARTICLE 3

SUBSEQUENT SHARE DELIVERIES

Section
3.01.  Subsequent Delivery of Shares.  (a)  On the third Business Day immediately following the
Valuation Completion Date, the Seller shall deliver to the Purchaser the
Settlement Number, if any.

(b)        Delivery pursuant to this Article 3
shall be effected in accordance with the Seller’s customary procedures.

ARTICLE 4

MARKET TRANSACTIONS

Section
4.01.  Transactions by the Seller.  (a) The parties agree and acknowledge that:

(i)       During any Seller Termination Share
Purchase Period, the Seller (or its agent or affiliate) may effect transactions
in shares of Common Stock in connection with this Confirmation.  The timing of such transactions by the Seller,
the price paid or received per share of Common Stock pursuant to such
transactions and the manner in which such transactions are made, including
without limitation whether such transactions are made on any securities
exchange or privately, shall be within the sole judgment of the Seller; provided that the Seller shall use good faith efforts to
make all purchases of Common Stock in a manner that would comply with the
limitations set forth in clauses (b)(2), (b)(3), (b)(4) and (c) of Rule 10b-18
as if such rule were applicable to such purchases.

(ii)      During the Averaging Period, the Seller
(or its agent or affiliate) may effect transactions in shares of Common Stock
in connection with this Confirmation. 
The timing of such transactions by the Seller, the price paid or
received per share of Common Stock pursuant to such transactions and the manner
in which such transactions are made, including without limitation whether such
transactions are made on any securities exchange or privately, shall be within
the sole judgment of the Seller.

(iii)     The Purchaser shall, at least one day prior
to the first day of the Seller Termination Share Purchase Period, notify the
Seller of the total number of shares of Common Stock purchased in Rule 10b-18
purchases of blocks pursuant to the once-a-week block exception set forth in
Rule 10b-18(b)(4) by or for the Purchaser or any of its Affiliated Purchasers
during each of the four calendar weeks preceding such day and during the
calendar week in which such day occurs (“Rule 10b-18 purchase”
and “blocks” each being used as defined in
Rule 10b-18), which notice shall be substantially in the form set forth as
Exhibit A hereto.

(b)        The Purchaser acknowledges and agrees
that (i) all transactions effected pursuant to Section 4.01 hereunder shall be
made in the Seller’s sole judgment and for the Seller’s own account and (ii)
the Purchaser does not have, and shall not attempt to exercise, any influence
over how, when or whether to effect such transactions, including, without
limitation, the price paid or received per share of Common Stock pursuant to
such transactions whether such transactions are made on any securities exchange
or privately.  It is the intent of the
Seller and the Purchaser that this Transaction comply with the requirements of
Rule 10b5-1(c) of the Exchange Act and that this Confirmation shall be
interpreted to comply with the requirements of Rule 10b5-1(c)(1)(i)(B) and the
Seller shall take no action that results in the Transaction not so complying
with such requirements.

(c)        Notwithstanding anything to the contrary
in this Confirmation, the Purchaser acknowledges and agrees that, on any day,
the Seller shall not be obligated to deliver or receive any shares of Common
Stock to or from the Purchaser and the Purchaser shall not be entitled to
receive any shares of Common Stock from the Seller on such day, to the extent
(but only to the extent) that after such transactions (i) the Seller’s ultimate

 

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parent entity would directly or indirectly
beneficially own (as such term is defined for purposes of Section 13(d) of the
Exchange Act) at any time on such day in excess of 8.0% of the outstanding
shares of Common Stock or (ii) the Seller’s ultimate parent entity would
purchase, acquire, or take (as used in the Federal Power Act) at any time on
such day in excess of 8.0% of the outstanding shares of Common Stock.  Any purported receipt or delivery of shares
of Common Stock shall be void and have no effect to the extent (but only to the
extent) that after any receipt or delivery of such shares of Common Stock the
Seller’s ultimate parent entity or the Seller, as applicable, would directly or
indirectly so beneficially own or purchase, acquire or take, as applicable, the
percentage limitations set forth above of the outstanding shares of Common
Stock.  If, on any day, any delivery or
receipt of shares of Common Stock by the Seller is not effected, in whole or in
part, as a result of this provision, the Seller’s and Purchaser’s respective
obligations to make or accept such receipt or delivery shall not be
extinguished and such receipt or delivery shall be effected over time as
promptly as the Seller determines, in the reasonable determination of the
Seller, that after such receipt or delivery its or its ultimate parent entity,
as applicable, would not directly or indirectly beneficially own in excess of
the percentage limitations set forth above of the outstanding shares of Common
Stock.

Section
4.02.  Adjustment of Transaction for
Securities Laws.  (A)  If,
based on the advice of counsel, Seller reasonably determines that, on any
Trading Day, Seller’s trading activity in order to manage its economic hedge in
respect of the Transaction would not be advisable in respect of applicable
securities laws, then Seller may extend the Expiration Date, modify the
Averaging Period, or otherwise adjust the terms of the Transaction in its good
faith reasonable discretion to ensure Seller’s compliance with such laws.  The Seller shall notify the Purchaser of the
exercise of the Seller’s rights pursuant to this Section 4.02(a) upon such
exercise and the basis for such action.

(b)        The Purchaser agrees that, during the
Contract Period, neither the Purchaser nor any of its affiliates or agents
shall make any distribution (as defined in Regulation M) of Common Stock, or
any security for which the Common Stock is a reference security (as defined in
Regulation M) or take any other action that would, in the view of the Seller,
preclude purchases by the Seller of the Common Stock or cause the Seller to
violate any law, rule or regulation with respect to such purchases.

Section
4.03.  Purchases of Common Stock by the Purchaser.  Except for transactions (x) effected by an
agent independent of the Purchaser within the meaning of Rule 10b-18(a)(13)(ii)
by or for a shareholder investment or employee savings plan of the Purchaser or
(y) effected by agreement between the parties for long-term incentive plans of
the Purchaser in compliance with the limitations set forth in clauses (b)(2),
(b)(3), (b)(4) and (c) of Rule 10b-18, the Purchaser shall not, and shall cause its affiliates
and affiliated purchasers (each as defined in Rule 10b-18) not to,
directly or indirectly (including, without limitation, by means of a derivative
instrument) purchase, offer to purchase, place any bid or limit order that
would effect a purchase of, or commence any tender offer relating to, any
shares of Common Stock (or equivalent interest, including a unit of beneficial
interest in a trust or limited partnership or a depository share) or any
security convertible into or exchangeable for shares of Common Stock during the
Contract Period.

ARTICLE 5

REPRESENTATIONS, WARRANTIES AND AGREEMENTS

Section
5.01.  Repeated Representations, Warranties and
Agreements of the Purchaser. 
The
Purchaser represents and warrants to, and agrees with, the Seller, on the date
hereof and on any date on which the Purchaser elects to receive or make any
delivery or payment pursuant to Section 7.03 of this Confirmation, that:

(a)        Disclosure; Compliance
with Laws.  The reports and
other documents required to be filed from and including the ending date of the
Purchaser’s most recent prior fiscal year have been filed by the Purchaser with
the SEC pursuant to the Exchange Act when considered as a whole (with the more
recent such reports and documents deemed to amend inconsistent statements
contained in any earlier such reports and documents and taking into account all
amendments and supplements to such reports that have been filed), do not
contain any untrue statement of a material fact or any omission of a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances in which they were made, not misleading.  The 

 

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Purchaser is not in possession of any material
nonpublic information regarding the Purchaser or the Common Stock.

(b)        Rule 10b5-1.  The Purchaser acknowledges that (i) the
Purchaser does not have, and shall not attempt to exercise, any influence over
how, when or whether to effect purchases of Common Stock by the Seller (or its
agent or affiliate) in connection with this Confirmation and (ii) the Purchaser
is entering into the Agreement and this Confirmation in good faith and not as
part of a plan or scheme to evade compliance with federal securities laws
including, without limitation, Rule 10b-5 promulgated under the Exchange
Act.  The Purchaser also acknowledges and
agrees that any amendment, modification, waiver or termination of this
Confirmation must be effected in accordance with the requirements for the
amendment or termination of a “plan” as defined in Rule 10b5-1(c) under the
Exchange Act.  Without limiting the
generality of the foregoing, any such amendment, modification, waiver or
termination shall be made in good faith and not as part of a plan or scheme to
evade the prohibitions of Rule 10b-5 under the Exchange Act.

(c)        No Manipulation.  The Purchaser is not entering into this
Confirmation to create actual or apparent trading activity in the Common Stock
(or any security convertible into or exchangeable for Common Stock) or to
manipulate the price of the Common Stock (or any security convertible into or
exchangeable for Common Stock).

(d)        Regulation M.  The Purchaser is not engaged in a
distribution, as such term is used in Regulation M, that would preclude
purchases by the Purchaser or the Seller of the Common Stock or cause the
Seller to violate any law, rule or regulation with respect to such purchases.

(e)        Board Authorization.  The Purchaser is entering into this
Transaction in connection with its share repurchase program, which was approved
by its board of directors and publicly disclosed on or prior to the date
hereof.  There is no internal policy of the
Purchaser, whether written or oral, that would prohibit the Purchaser from
entering into any aspect of this Transaction, including, but not limited to,
the purchases of shares of Common Stock to be made pursuant hereto.

(f)         Due Authorization and Good
Standing.  The Purchaser is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Maryland.  This
Confirmation has been duly authorized, executed and delivered by the Purchaser
and (assuming due authorization, execution and delivery thereof by the Seller)
constitutes a valid and legally binding obligation of the Purchaser. The
Purchaser has all corporate power to enter into this Confirmation and to
consummate the transactions contemplated hereby and to purchase the Common
Stock in accordance with the terms hereof.

(g)        Certain Transactions.  There has not been any public announcement
(as defined in Rule 165(f) under the Securities Act) of any merger,
acquisition, or similar transaction involving a recapitalization relating to
the Purchaser that would fall within the scope of Rule 10b-18(a)(13)(iv).

Section
5.02.  Initial Representations,
Warranties and Agreements of the Purchaser.  The
Purchaser represents and warrants to, and agrees with the Seller, as of the
date hereof, that:

(a)        Solvency.  The assets of the Purchaser at their fair
valuation exceed the liabilities of the Purchaser, including contingent
liabilities; the capital of the Purchaser is adequate to conduct the business
of the Purchaser and the Purchaser has the ability to pay its debts and
obligations as such debts mature and does not intend to, or does not believe
that it will, incur debt beyond its ability to pay as such debts mature.

(b)        Required Filings.  The Purchaser has made, and will use its best
efforts to make, all filings required to be made by it with the SEC, any
securities exchange or any other regulatory body with respect to the
Transaction contemplated hereby.

(c)        No Conflict.  The execution and delivery by the
Purchaser of, and the performance by the Purchaser of its obligations under,
this Confirmation and the consummation of the transactions herein contemplated
do not conflict with or violate (i) any provision of the certificate of
incorporation, by-laws or other 

 

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constitutive documents of the Purchaser, (ii) any
statute or order, rule, regulation or judgment of any court or governmental
agency or body having jurisdiction over the Purchaser or any of its
subsidiaries or any of their respective assets or (iii) any contractual
restriction binding on or affecting the Purchaser or any of its subsidiaries or
any of its material assets.

(d)        Consents.  All governmental and other consents that are
required to have been obtained by the Purchaser with respect to performance,
execution and delivery of this Confirmation have been obtained and are in full
force and effect and all conditions of any such consents have been complied
with.

(e)        Investment Company Act.  The Purchaser is not and, after giving effect
to the transactions contemplated in this Confirmation, will not be required to
register as an “investment company” as such term is defined in the Investment
Company Act of 1940, as amended.

Section
5.03.  Additional Representations, Warranties and Agreements.  The Purchaser and the Seller represent and warrant to,
and agree with, each other that:

(a)        Agency.  Each party agrees and acknowledges that (i) J.P. Morgan Securities
Inc., an affiliate of the Seller (“JPMSI”), has
acted solely as agent and not as principal with respect to this Transaction and
(ii) JPMSI has no obligation or liability, by way of guaranty, endorsement or
otherwise, in any manner in respect of its acting as agent in respect of this
Transaction (including, if applicable, in respect of the settlement
thereof).  Each party agrees it will look
solely to the other party (or any guarantor in respect thereof) for performance
of such other party’s obligations under this Transaction. JPMSI is authorized
to act as agent for the Seller.

(b)        Non-Reliance.  Each party has entered into this Transaction
solely in reliance on its own judgment. 
Neither party has any fiduciary obligation to the other party relating
to this Transaction.  In addition,
neither party has held itself out as advising, or has held out any of its
employees or agents as having the authority to advise, the other party as to
whether or not the other party should enter into this Transaction, any
subsequent actions relating to this Transaction or any other matters relating
to this Transaction.  Neither party shall
have any responsibility or liability whatsoever in respect of any advice of
this nature given, or views expressed, by it or any such persons to the other
party relating to this Transaction, whether or not such advice is given or such
views are expressed at the request of the other party.  The Purchaser has conducted its own analysis
of the legal, accounting, tax and other implications of this Transaction and
consulted such advisors, accountants and counsel as it has deemed necessary.

(c)        Commodity Exchange Act.  Each party is an “eligible contract participant”, as such term is defined in
Section 1a(12) of the Commodity Exchange Act, as amended.

Section
5.04.  Representations and Warranties of the Seller.  The Seller represents and warrants to the Purchaser
that:

(a)        Due Authorization.  This Confirmation has been duly authorized,
executed and delivered by the Seller and (assuming due authorization, execution
and delivery thereof by the Purchaser) constitutes a valid and legally binding
obligation of the Seller. The Seller has all corporate power to enter into this
Confirmation and to consummate the transactions contemplated hereby and to
deliver the Common Stock in accordance with the terms hereof.

(b)        Right to Transfer.  The Seller will, at the Initial Settlement
Date, have the free and unqualified right to transfer the Number of Shares of
Common Stock to be sold by the Seller pursuant to Section 2.01 hereof, free and
clear of any security interest, mortgage, pledge, lien, charge, claim, equity
or encumbrance of any kind.

 

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ARTICLE 6

ADDITIONAL COVENANTS

Section
6.01.  Purchaser’s Further Assurances.  The Purchaser hereby agrees with the Seller that the
Purchaser shall cooperate with the Seller, and execute and deliver, or use its
best efforts to cause to be executed and delivered, all such other instruments,
and to obtain all consents, approvals or authorizations of any person, and take
all such other actions as the Seller may reasonably request from time to time,
consistent with the terms of this Confirmation, in order to effectuate the
purposes of this Confirmation and the Transaction contemplated hereby.

Section
6.02  Purchaser’s Hedging Transactions. 
The Purchaser hereby agrees with the Seller that the Purchaser shall
not, during the Contract Period, enter into or alter any corresponding or
hedging transaction or position with respect to the Common Stock (including,
without limitation, with respect to any securities convertible or exchangeable
into the Common Stock) and agrees not to alter or deviate from the terms of
this Confirmation.

Section
6.03.  No Communications.  The Purchaser hereby agrees with the Seller that the
Purchaser shall not, directly or indirectly, communicate any information
relating to the Common Stock or this Transaction (including any notices
required by Section 6.04) to any employee of the Seller or J.P. Morgan
Securities Inc., other than as set forth in the Communications Procedures
attached as Annex A hereto.

Section
6.04.  Notice of Certain
Transactions.  If at any time
during the Contract Period, the Purchaser makes, or expects to be made, or has
made, any public announcement (as defined in Rule 165(f) under the Securities
Act) of any merger, acquisition, or similar transaction involving a
recapitalization relating to the Purchaser (other than any such transaction in
which the consideration consists solely of cash and there is no valuation
period, or as to which the completion of such transaction or the completion of
the vote by target shareholders has occurred), then the Purchaser shall (i)
notify the Seller prior to the opening of trading in the Common Stock on any
day on which the Purchaser makes, or expects to be made, or has made any such
public announcement, (ii) notify the Seller promptly following any such
announcement (or, if later, prior to the opening of trading in the Common Stock
on the first day of any Seller Termination Share Payment Period) that such
announcement has been made and (iii) promptly deliver to the Seller following
the making of any such announcement (or, if later, prior to the opening of
trading in the Common Stock on the first day of any Seller Termination Share
Payment Period) a certificate indicating (A) the Purchaser’s average daily Rule
10b-18 purchases (as defined in Rule 10b-18) during the three full calendar
months preceding the date of such announcement and (B) the Purchaser’s block
purchases (as defined in Rule 10b-18) effected pursuant to paragraph (b)(4) of
Rule 10b-18 during the three full calendar months preceding the date of such
announcement.  In addition, the Purchaser
shall promptly notify the Seller of the earlier to occur of the completion of
such transaction and the completion of the vote by target shareholders.  Accordingly, the Purchaser acknowledges that
its actions in relation to any such announcement or transaction must comply
with the standards set forth in Section 6.03.

ARTICLE 7

TERMINATION

Section
7.01. Events
of Default.  If an Event of
Default occurs, the provisions of Section 6 of the Agreement shall apply and
the Termination Amount shall be paid in accordance with Section 6 of the
Agreement.

Section
7.02.  Additional Termination Events.

(a)        An Additional Termination Event shall
occur in respect of which the Purchaser is the sole Affected Party and this
Transaction is the sole Affected Transaction if (i) a Share De-listing Event
occurs; (ii) a Merger Event occurs; (iii) a Nationalization occurs, (iv) the
10b-18 VWAP on any Trading Day following the 

 

9

Trade Date shall have been less than $48.00 (subject
to adjustment under Section 8.02) or (v) an event described in paragraph III of
Annex A occurs.

(b)        A “Share De-listing Event”
means that at any time during the Contract Period, the Common Stock ceases to
be listed, traded or publicly quoted on the Exchange for any reason (other than
a Merger Event, a “De-Listing”)
and is not immediately re-listed, traded or quoted as of the date of such
de-listing, on another U.S. national securities exchange or a U.S. automated
interdealer quotation system (a “Successor Exchange”),
provided that it shall not constitute an
Additional Termination Event if the Common Stock is immediately re-listed on a
Successor Exchange upon its De-Listing from the Exchange, and the Successor
Exchange shall be deemed to be the Exchange for all purposes.  In addition, in such event, the Seller shall
make any commercially reasonable adjustments it deems necessary to the terms of
the Transaction.

(c)        A “Merger Event”
means, in respect of the Common Stock, the public announcement, including any
public announcement as defined in Rule 165(f) of the Securities Act (by the
Purchaser or otherwise) at any time during the Contract Period any (i) recapitalization,
reclassification or change of the Common Stock that will, if consummated,
result in a transfer of all of the outstanding shares of Common Stock, (ii)
consolidation, amalgamation, merger or similar transaction of the Purchaser
with or into another entity (other than a consolidation, amalgamation or merger
in which the Purchaser will be the continuing entity and which does not result
in any such recapitalization, reclassification or change of more than 50% of
such shares outstanding), (iii) other takeover offer for the shares of Common
Stock that is aimed at resulting in a transfer of 100% of such shares of Common
Stock (other than such shares owned or controlled by the offeror) or (iv)
irrevocable commitment to so recapitalize, reclassify or change.

(d)        A “Nationalization”
means that all or substantially all of the outstanding shares of Common Stock
or assets of the Purchaser are nationalized, expropriated or are otherwise
required to be transferred to any governmental agency, authority or entity.

Section
7.03.  Consequences of Additional
Termination Events.  (a) In the event of the
occurrence or effective designation of an Early Termination Date under the
Agreement, cash settlement of the Termination Amount, as set forth in Section
7.03(b), shall apply unless (i) the Purchaser
elects (which election shall be binding) in lieu of payment of the amount payable in respect of
this Transaction pursuant to Section 6(d)(ii) of the Agreement, to deliver or
to receive Alternative Termination Delivery Units pursuant to Section 7.04, and (ii) notifies the
Seller of such election by delivery of written notice to the Seller on the
Business Day immediately following the Purchaser’s receipt of a notice (as
required by Section 6(d) of the Agreement following the designation of an Early
Termination Date in respect of this Transaction) setting forth the amounts
payable by the Seller or the Purchaser with respect to such Early Termination
Date (the date of such delivery, the “Default Notice Day”)
in which event (x) if the Termination Amount is owed to the Purchaser, the
Seller shall be obligated to deliver to the Purchaser, or (y) if the
Termination Amount is owed to the Seller, the Purchaser shall be obligated to
deliver to the Seller, the Alternative Termination Delivery Units pursuant to
Section 7.04 in a transaction exempted from the registration requirements under
the Securities Act; provided that the Purchaser’s election to deliver or receive
the Alternative Termination Delivery Units pursuant to
Section 7.04 shall not be valid
and cash settlement shall apply if (i) the representations
and warranties made by the Purchaser to the Seller in Section 5.01 are not true
and correct as of the date the Purchaser makes such election, as if made on
such date or (ii) in the event that the Termination Amount is payable by the
Purchaser to the Seller, (A) the Purchaser has taken any action that would make
unavailable (x) the exemption set forth in Section 4(2) of the Securities Act,
for the sale of any Alternative Termination Delivery Units by the Purchaser to
the Seller or (y) an exemption from the registration requirements of the
Securities Act reasonably acceptable to the Seller for resales of Alternative
Termination Delivery Units by the Seller, (B) such Early Termination Date is in
respect of an event which is within Purchaser’s control, or (C) the Purchaser
fails to execute a private placement agreement providing for such resale, which
agreement shall be in form and substance reasonably satisfactory to the Seller,
or otherwise fails to comply with any commercially reasonable requirements
imposed by the Seller in respect of the private placement of the Alternative
Termination Delivery Units.

(b)        If cash settlement applies in respect of
an Early Termination Date, Section 6 of the Agreement shall apply.

 

10

Section
7.04.  Alternative Termination Settlement.  Subject to Section 7.03(a), unless cash settlement is applicable pursuant to
Section 7.03(b), (i) the Seller shall, beginning on the first
Trading Day following the Default Notice Day and ending when the Seller shall
have satisfied its obligations under this clause (the “Seller
Termination Share Purchase Period”), purchase (subject to the
provisions of Section 4.01 and Section 4.02 hereof) a number of Alternative
Termination Delivery Units equal to (A) the Termination Amount divided by (B) the Termination Price; and (ii) the Seller
shall deliver such Alternative Termination Delivery Units to the Purchaser on
the settlement dates relating to such purchases; provided
that if the Termination Amount is owed to the Seller, clauses (i) and (ii) of
this Section 7.04 shall not apply and, in lieu thereof, the Purchaser shall, as
soon as directed by the Seller after the Default Notice Day, deliver to the
Seller a number of Alternative Termination Delivery Units equal to the quotient
of (A) the Termination Amount divided by (B) the Termination Price.  Notwithstanding the foregoing, the Purchaser
shall not be required to deliver shares of Common Stock or other securities
comprising the aggregate Alternative Termination Delivery Units in excess of
the Share Cap, in each case except to the extent that the Purchaser has
available at such time authorized but unissued shares of such Common Stock or
other securities not expressly reserved for any other uses (including, without
limitation, shares of Common Stock reserved for issuance upon the exercise of
options or convertible debt).  The
Purchaser shall not permit the sum of (i) the Share Cap plus (ii) the aggregate
number of shares expressly reserved for any such other uses, in each case
whether expressed as caps or as numbers of shares reserved or otherwise, to
exceed at any time the number of authorized but unissued shares of Common
Stock.

Section
7.05.  Notice of Default.  If an Event of Default occurs in respect of the
Purchaser, the Purchaser will, promptly upon becoming aware of it, notify the
Seller specifying the nature of such Event of Default.

ARTICLE 8

ADJUSTMENTS

Section
8.01.  Cash Dividends.  (a) If the Purchaser declares any Extraordinary Cash
Dividend that has a record date during the Contract Period, then an Additional
Termination Event shall occur in respect of which the Purchaser is the sole
Affected Party and this Transaction is the sole Affected Transaction.

(b)   If the Purchaser declares any cash dividend
on shares of Common Stock that is not an Extraordinary Cash Dividend (an “Ordinary Cash Dividend”) and that has a record date during
the Contract Period, and the amount of such Ordinary Cash Dividend, together
with all prior declared Ordinary Cash Dividends that have a record date during
the same regular dividend period of the Purchaser, exceeds the amount set forth
in the Pricing Supplement for such regular dividend period, then an Additional
Termination Event shall occur in respect of which the Purchaser is the sole
Affected Party and this Transaction is the sole Affected Transaction.

Section
8.02.  Other Dilution
Adjustments.  If (x) any
corporate event occurs involving the Purchaser or the Common Stock (other than
an Extraordinary Cash Dividend or an Ordinary Cash Dividend but including,
without limitation, a spin-off, a stock split, stock or other dividend or
distribution, reorganization, rights offering or recapitalization or any other
event having a dilutive or concentrative effect on the Common Stock) or (y) as
a result of market conditions, the Seller incurs additional costs in connection
with maintaining its hedge position with respect to this Transaction resulting
from the insufficient availability of stock lenders willing and able to lend
shares of Common Stock with a borrow cost not significantly greater than the
cost as of the date hereof, then in any such case, the Calculation Agent shall
make corresponding adjustments with respect to any one or more of the Upside
Threshold, the Minimum Delivery Number and any other variable relevant to the
terms of the Transaction, as the Calculation Agent determines appropriate to
preserve the fair value of the Transaction to the Seller, and shall determine
the effective date of such adjustment.

 

11

ARTICLE 9

MISCELLANEOUS

Section
9.01.  Successors and Assigns.  All covenants and agreements in this Confirmation made
by or on behalf of either of the parties hereto shall bind and inure to the
benefit of the respective successors and assigns of the parties hereto whether
so expressed or not.

Section
9.02.  Assignment and Transfer.  Notwithstanding the Agreement, the Seller may assign
any of its rights or duties hereunder to any one or more of its affiliates
without the prior written consent of the Purchaser but with prior written
notice to the Purchaser (except that no written notice is required for such
assignment or transfer to JPMSI). Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing Seller to purchase, sell,
receive or deliver any shares of Common Stock or other securities to or from
the Purchaser, Seller may designate any of its affiliates to purchase, sell,
receive or deliver such shares of Common Stock or other securities and
otherwise to perform the Seller’s obligations in respect of this Transaction
and any such designee may assume such obligations.  The Seller shall be discharged of its
obligations to the Purchaser only to the extent of any such performance.  For the avoidance of doubt, Seller hereby
acknowledges that notwithstanding any such designation hereunder, to the extent
any of Seller’s obligations in respect of this Transaction are not completed by
its designee, Seller shall be obligated to continue to perform or to cause any
other of its designees to perform in respect of such obligations.

Section
9.03.  Calculation Agent.  Whenever the Calculation Agent is required to
act or to exercise judgment in a any way with respect to this Transaction, it
will do so in good faith and in a commercially reasonable manner. All
determinations and calculations by the Calculation Agent, including 10b-18 VWAP
determinations, shall be provided to the other party at the end of each Trading
Day.

Section
9.04.  Non-confidentiality.  The Seller and the Purchaser hereby
acknowledge and agree that the parties are authorized to disclose the
Transaction and any related hedging transaction between the parties if and to
the extent such disclosing party reasonably determines (after consultation with
the other party) that such disclosure is required by law or by the rules of any
securities exchange or similar trading platform. Notwithstanding
any provision in this Confirmation, any Pricing Supplement or the Agreement, in
connection with Section 1.6011-4 of the Treasury Regulations, the parties
hereby agree that each party (and each employee, representative, or other agent
of such party) may disclose to any and all persons, without limitation of any
kind, the U.S. tax treatment and U.S. tax structure of the Transaction and all
materials of any kind (including opinions or other tax analyses) that are
provided to such party relating to such U.S. tax treatment and U.S. tax structure,
other than any information for which nondisclosure is reasonably necessary in
order to comply with applicable securities laws.

Section
9.05.  Unenforceability and Invalidity.  To the extent permitted by law, the unenforceability
or invalidity of any provision or provisions of this Confirmation shall not
render any other provision or provisions herein contained unenforceable or
invalid.

Section
9.06.  Securities Contract.  The parties hereto agree and acknowledge as of the
date hereof that (i) the Seller is a “financial institution” within the meaning
of Section 101(22) of Title 11 of the United States Code (the “Bankruptcy Code”) and (ii) this Confirmation is a “securities
contract,” as such term is defined in Section 741(7) of the Bankruptcy Code,
entitled to the protection of Sections 362(b)(6) and 555 of the Bankruptcy
Code.

Section
9.07.  No Collateral, Netting or Setoff.  Notwithstanding any provision of the Agreement, or any
other agreement between the parties, to the contrary, the obligations of the
Purchaser hereunder are not secured by any collateral.  Obligations under this Transaction shall not
be netted, recouped or set off (including pursuant to Section 6 of the
Agreement) against any other obligations of the parties, whether arising under
the Agreement, this Confirmation, under any other agreement between the parties
hereto, by operation of law or otherwise, and no other obligations of the
parties shall be netted, recouped or set off (including pursuant to Section 6
of the Agreement) against obligations under this Transaction, whether arising
under the Agreement, this Confirmation, under any other agreement between the
parties hereto, by operation of law or otherwise, and each party hereby waives
any such right of setoff, netting or recoupment.

 

12

Section
9.08  Notices. Unless otherwise specified herein, any notice, the
delivery of which is expressly provided for in this Confirmation, may be made
by telephone, to be confirmed in writing to the address below.  Changes to the information below must be made
in writing.

(a)           If
to the Purchaser:

 

Constellation Energy Group, Inc.

750 E. Pratt Street

Baltimore, MD 21202

Attention:  Jeanne M. Blondia

Title:  Vice President and Treasurer

Telephone No:  410 470-3620

Facsimile No:   410-470-5680

 

(b)           If to the Seller:

 

JPMorgan Chase Bank, National Association

c/o J.P. Morgan Securities Inc.

277 Park Avenue

New York, NY 
10172

Attention:  Eric
Stefanik

Title:  Operations Analyst

EDG Corporate Marketing

Telephone No:  (212) 622-5814

Facsimile No:   (212) 622-8534

 

Section
9.09.  Waiver of
Right to Trial by Jury.  EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY WITH
RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
ANY TRANSACTION CONTEMPLATED HEREBY.

 

13

Please
confirm that the foregoing correctly sets forth the terms of our agreement by
executing the copy of this Confirmation enclosed for that purpose and returning
it to us.

	
   

  	
   

  	
  Yours sincerely,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  J.P. MORGAN SECURITIES
  INC., as agent for JPMorgan

  
	
   

  	
   

  	
   Chase Bank, National Association, London
  Branch

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Sudheer Tegulapalle

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Sudheer
  Tegulapalle

  	
   

  
	
   

  	
   

  	
   

  	
  Title: Executive
  Director

  	
   

  
						

 

Confirmed as of the date
first

above written:

CONSTELLATION
ENERGY GROUP, INC.

 

 

	
  By:

  	
  /s/ Jeanne M.
  Blondia

  	
   

  	
   

  
	
   

  	
  Name: Jeanne M.
  Blondia

  	
   

  	
   

  
	
   

  	
  Title: Vice
  President, Treasurer and Assistant Secretary

  	
   

  	
   

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JPMorgan Chase Bank,
National Association

Organised under the laws of
the United States as a National Banking Association.

Main Office 1111 Polaris
Parkway, Columbus, Ohio 43271

Registered as a branch in
England & Wales branch No. BR000746.

Registered Branch Office
125 London Wall, London EC2Y 5AJ

Authorised and regulated by the Financial Services
Authority

 

 

 

14

 

ANNEX A

 

COMMUNICATIONS
PROCEDURES

 

 

October 31, 2007

 

I.              Introduction

Constellation
Energy Group, Inc., a Maryland corporation (“Counterparty”)
and J.P. Morgan Securities Inc., as agent for JPMorgan Chase Bank, National
Association, London Branch (“JPMorgan”) have
adopted these communications procedures (the “Communications
Procedures”) in connection with entering into the Confirmation (the
“Confirmation”) dated as of October 31,
2007 between JPMorgan and Counterparty relating to the sale by JPMorgan to
Counterparty of common stock, with no par value per share, or security
entitlements in respect thereof (the “Common Stock”)
of the Counterparty.  These
Communications Procedures supplement, form part of, and are subject to the
Confirmation.

II.            Communications
Rules

From
the date hereof until the end of the Contract Period, Counterparty and its
Employees and Designees shall not engage in any Program-Related Communication
with, or disclose any Material Non-Public Information to, any EDG Trading
Personnel.  Except as set forth in the
preceding sentence, the Confirmation shall not limit Counterparty and its
Employees and Designees in their communication with Affiliates and Employees of
JPMorgan, including without limitation Employees who are EDG Permitted Contacts.

III.           Termination

If,
in the sole judgment of any EDG Trading Personnel or any affiliate or Employee
of JPMorgan participating in any Communication with Counterparty or any
Employee or Designee of Counterparty, such Communication would not be permitted
by these Communications Procedures, such EDG Trading Personnel or affiliate or
Employee of JPMorgan shall immediately terminate such Communication.  In such case, or if such EDG Trading
Personnel or affiliate or Employee of JPMorgan determines following completion
of any Communication with Counterparty or any Employee or Designee of
Counterparty that such Communication was not permitted by these Communications
Procedures, such EDG Trading Personnel or such affiliate or Employee of
JPMorgan shall promptly consult with his or her supervisors and with counsel
for JPMorgan regarding such Communication. 
If, in the reasonable judgment of JPMorgan’s counsel following such
consultation, there is more than an insignificant risk that such Communication
could materially jeopardize the availability of the affirmative defenses
provided in Rule 10b5-1 under the 1934 Act with respect to any ongoing or
contemplated activities of JPMorgan or its affiliates in respect of the
Confirmation, it shall be an Additional Termination Event with respect to the
Confirmation.

IV.           Definitions

Capitalized
terms used and not otherwise defined herein shall have the meanings ascribed to
them in the Confirmation.  As used
herein, the following words and phrases shall have the following meanings:

“Communication” means any contact or communication (whether
written, electronic, oral or otherwise) between Counterparty or any of its
Employees or Designees, on the one hand, and JPMorgan or any of its affiliates
or Employees, on the other hand.

 

 

A-1

 

 

“Designee” means a person designated, in writing or orally,
by Counterparty to communicate with JPMorgan on behalf of Counterparty.

“EDG Permitted Contact” means any of Mr. David Aidelson, Ms.
Bernadette Barnard, Mr. Gregory Batista, Mr. Elliot Chalom, Mr. Santosh Nabar,
Mr. James Rothschild and Mr. Sudheer Tegulapalle or any of their designees; provided that JPMorgan may amend the list of EDG Permitted
Contacts by delivering a revised list of EDG Permitted Contacts to
Counterparty.

“EDG Trading Personnel” means Reuben Jacob, Gaurav Arora and
any other Employee of the public side of the Equity Derivatives Group or the
Special Equities Group of J.P. Morgan Chase & Co.; provided
that JPMorgan may amend the list of EDG Trading Personnel by delivering a
revised list of EDG Trading Personnel to Counterparty; and provided
further that, for the avoidance of doubt, the persons listed as
EDG/SEG Permitted Contacts are not EDG/SEG Trading Personnel.

“Employee” means, with respect to any entity, any principal,
officer, director, employee or other agent or representative of such entity.

“Material Non-Public Information” means information relating
to the Counterparty or the Common Stock that (a) has not been widely disseminated
by wire service, in one or more newspapers of general circulation, by
communication from the Counterparty to its shareholders or in a press release,
or contained in a public filing made by the Counterparty with the Securities
and Exchange Commission and (b) a reasonable investor might consider to be of
importance in making an investment decision to buy, sell or hold shares of
Common Stock.  For the avoidance of doubt
and solely by way of illustration, information should be presumed “material” if
it relates to such matters as dividend increases or decreases, earnings
estimates, changes in previously released earnings estimates, significant
expansion or curtailment of operations, a significant increase or decline of
orders, significant merger or acquisition proposals or agreements, significant
new products or discoveries, extraordinary borrowing, major litigation,
liquidity problems, extraordinary management developments, purchase or sale of
substantial assets and similar matters.

 “Program-Related
Communication” means any Communication the subject matter of which
relates to the Confirmation or any Transaction under the Confirmation or any
activities of JPMorgan (or any of its affiliates) in respect of the
Confirmation or any Transaction under the Confirmation.

 

 

 

A-2

.

 

ANNEX B

 

FORM OF
PRICING SUPPLEMENT

 

This Pricing Supplement is subject to the Confirmation
dated as of __________ (the “Confirmation”)
between J.P. Morgan Securities Inc., as agent for JPMorgan Chase Bank, National
Association, London Branch (the “Seller”), and
__________, a ________ corporation (the “Purchaser”).  Capitalized terms used herein have the
meanings set forth in the Confirmation.

 

	
  1

  	
  Discount:

  	
  [                            ]

  
	
   

  	
   

  	
   

  
	
  2

  	
  Upside Threshold:

  	
  [                            ]

  
	
   

  	
   

  	
   

  
	
  3

  	
  Calculation Agent: 

  	
  [                            ]

   

  
	
  4

  	
  Valuation Completion Date:

  	
  The Trading Day, during
  the period commencing on and including the [  
  ] Trading Day following the Valuation Commencement Date and ending on
  and including the Expiration Date, specified as such by the Seller, in its
  sole judgment, by delivering a notice designating such Trading Day as a
  Valuation Completion Date by the close of business on the Business Day
  immediately following such Trading Day; provided that if the Seller fails to
  validly designate the Valuation Completion Date prior to the Expiration Date,
  the Valuation Completion Date shall be the Expiration Date.

  
	
   

  	
   

  	
   

  
	
  5

  	
  Ordinary Dividend Amount:

  	
   

  

 

	
  Ordinary Dividend Amount

  	
  Dividend Period

  
	
   

  	
   

  
	
  $__ per share of Common Stock

  	
  [                     ]

  
	
   

  	
   

  
	
  $__ per share of Common Stock

  	
  [                    
  ]

  
	
   

  	
   

  
	
  $__ per share of Common Stock

  	
  [                    
  ]

  

 

 

B-1

 

EXHIBIT
A

 

[Letterhead of Purchaser]

JPMorgan Chase Bank, National Association

c/o J.P. Morgan Securities Inc.

277 Park Avenue

11th Floor

New York, New York 10172

	
   

  	
  Re:

  	
  Accelarated Purchase of
  Equity Securities

  

 

Ladies and Gentlemen:

In
connection with our entry into the Confirmation dated as of ___________ (the “Confirmation”), we hereby represent that set forth below is
the total number of shares of our common stock purchased by or for us or any of
our affiliated purchasers in Rule 10b-18 purchases of blocks (all defined in
Rule 10b-18 under the Securities Exchange Act of 1934) pursuant to the
once-a-week block exception set forth in Rule 10b-18(b)(4) during the four full
calendar weeks immediately preceding the first day of the Averaging Period (as
defined in the Confirmation).

Number
of Shares:

We
understand that you will use this information in calculating trading volume for
purposes of Rule 10b-18.

	
   

  	
  Very truly yours,

  	
   

  	
   

  

 

 

 

	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 

 

Exh-B-1

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