Exhibit 10.4
REMARKETING
AGREEMENT
March 30, 2005
Banc of America Securities LLC
Hearst Tower
214 N. Tryon St.
Charlotte, North Carolina 28225
JPMorgan Chase Bank, N.A.
4 New York Plaza
New York, New York 10004
Attention: Institutional Trust
Services
Ladies and Gentlemen:
This Agreement is dated as of March
30, 2005 (this “ Agreement ”) by and among PNM
Resources, Inc., a New Mexico corporation (the “
Company ”), Banc of America Securities LLC, as the
reset agent and the remarketing agent (the “ Remarketing
Agent ”), and JPMorgan Chase Bank, N.A., a national
banking association, not individually but solely as Purchase
Contract Agent (the “ Purchase Contract Agent ”)
and as attorney-in-fact of the holders of Purchase Contracts (as
defined in the Purchase Contract and Pledge Agreement referred to
below).
Section 1. Definitions . (a)
Capitalized terms used and not defined in this Agreement shall have
the meanings set forth in the Purchase Contract and Pledge
Agreement, dated as of March 30, 2005, among the Company, the
Purchase Contract Agent and U.S. Bank Trust National Association,
as Collateral Agent, Custodial Agent and Securities Intermediary,
as amended from time to time (the “ Purchase Contract and
Pledge Agreement ”).
(b) As used in this Agreement, the
following terms have the following meanings:
“ Agreement ” has
the meaning specified in the first paragraph of this Remarketing
Agreement.
“ Commencement Date
” has the meaning specified in Section 3.
“ Commission ”
means the Securities and Exchange Commission.
“ Company ” has
the meaning specified in the first paragraph of this Remarketing
Agreement.
“ Final Remarketing
” has the meaning specified in Section 2(c).
“ Final Remarketing
Date ” has the meaning specified in Section
2(c).
“ indemnified party
” has the meaning specified in Section 7(c).
“ indemnifying party
” has the meaning specified in Section 7(c).
“ Initial Remarketing
” has the meaning specified in Section 2(b).
“ Initial Remarketing
Date ” has the meaning specified in Section
2(b).
“ Preliminary
Prospectus ” means any preliminary prospectus relating to
the Remarketed Senior Notes included in the Registration Statement,
including the documents incorporated by reference therein as of the
date of such preliminary prospectus; and any reference to any
amendment or supplement to such preliminary prospectus shall be
deemed to refer to and include any documents filed after the date
of such preliminary prospectus under the Exchange Act and
incorporated by reference in such preliminary
prospectus.
“ Prospectus ”
means the prospectus relating to the Remarketed Senior Notes, in
the form in which first filed, or transmitted for filing, with the
Commission after the effective date of the Registration Statement
pursuant to Rule 424(b), including the documents incorporated by
reference therein as of the date of such prospectus; and any
reference to any amendment or supplement to such prospectus shall
be deemed to refer to and include any documents filed after the
date of such prospectus, under the Exchange Act, and incorporated
by reference in such prospectus.
“ Purchase Contract and
Pledge Agreement ” has the meaning specified in Section
1(a).
“ Registration
Statement ” means a registration statement under the
Securities Act prepared by the Company relating to, inter alia, the
Remarketing of the Remarketed Senior Notes pursuant to Section 5(a)
hereunder, including all exhibits thereto and the documents
incorporated by reference in the prospectus contained in such
registration statement, and any post-effective amendments
thereto.
“ Remarketed Senior
Notes ” means the Senior Notes underlying the Pledged
Applicable Ownership Interests in Senior Notes and the Separate
Senior Notes, if any, subject to Remarketing as identified to the
Remarketing Agent by the Purchase Contract Agent and the Custodial
Agent, respectively, promptly after 5:00 p.m., New York City time,
on the sixth Business Day immediately preceding the Purchase
Contract Settlement Date, and shall include: (a) the Senior Notes
underlying the Pledged Applicable Ownership Interests in Senior
Notes of the Holders of Corporate Units who have not notified the
Purchase Contract Agent prior to 5:00 p.m., New York City time, on
the seventh Business Day immediately preceding the Purchase
Contract Settlement Date of their intention to effect a Cash
Settlement of the related Purchase Contracts pursuant to the terms
of the Purchase Contract and Pledge Agreement or who have so
notified the Purchase Contract Agent but failed to make the
required cash payment prior to 5:00 p.m., New York City time, on
the sixth Business Day immediately preceding the Purchase Contract
Settlement Date pursuant to the terms of the Purchase Contract and
Pledge Agreement, and (b) the Separate Senior Notes of the holders
of Separate Senior Notes, if any, who have elected to have their
Separate Senior Notes remarketed in such Remarketing prior to 5:00
p.m., New York City time, on the seventh Business Day immediately
preceding the Purchase Contract Settlement Date pursuant to the
terms of the Purchase Contract and Pledge Agreement.
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“ Remarketing ”
means the remarketing of the Remarketed Senior Notes pursuant to
this Remarketing Agreement on any of the Initial Remarketing Date,
the Second Remarketing Date or the Final Remarketing
Date.
“ Remarketing Fee
” has the meaning specified in Section 4.
“ Remarketing Materials
” means the Registration Statement, the Preliminary
Prospectus, the Prospectus or any other information furnished by
the Company to the Remarketing Agent for distribution to investors
in connection with the Remarketing.
“ Remarketing Settlement
Date ” means the Purchase Contract Settlement
Date.
“ Reset Rate ”
has the meaning specified in Section 2(d).
“ Second Remarketing
” has the meaning specified in Section 2(c).
“ Second Remarketing
Date ” has the meaning specified in Section
2(c).
“ Securities ”
has the meaning specified in Section 10.
“ Senior Notes ”
means the series of notes designated Senior Notes, Series A of the
Company.
“ Transaction Documents
” means this Agreement, the Purchase Contract and Pledge
Agreement and the Indenture, in each case as amended or
supplemented from time to time.
“ Underwriting
Agreement ” has the meaning specified in Section
3(a).
Section 2. Appointment and
Obligations of the Remarketing Agent . (a) The Company hereby
appoints Banc of America Securities LLC as the exclusive
Remarketing Agent, and, subject to the terms and conditions set
forth herein, Banc of America Securities LLC hereby accepts
appointment as Remarketing Agent, for the purpose of (i)
remarketing the Remarketed Senior Notes on behalf of the holders
thereof, (ii) determining, in consultation with the Company, in the
manner provided for herein and in the Purchase Contract and Pledge
Agreement and the Indenture, the Reset Rate for the Senior Notes,
and (iii) performing such other duties as are assigned to the
Remarketing Agent in the Transaction Documents.
(b) Unless a Special Event
Redemption or a Termination Event has occurred prior to such date,
on the fifth Business Day immediately preceding the Purchase
Contract Settlement Date (the “ Initial Remarketing
Date ”), the Remarketing Agent shall use its reasonable
efforts to remarket (the “ Initial Remarketing
”) the Remarketed Senior Notes at the Remarketing
Price.
(c) In the case of a Failed
Remarketing on the Initial Remarketing Date and unless a Special
Event Redemption or a Termination Event has occurred prior to such
date, on the fourth Business Day immediately preceding the Purchase
Contract Settlement Date (the “ Second Remarketing
Date ”), the Remarketing Agent shall use its reasonable
efforts to remarket (the “ Second Remarketing ”)
the Remarketed Senior Notes at the Remarketing Price. In the case
of a Failed Remarketing on the Second Remarketing Date and unless a
Special Event Redemption or
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a Termination Event has occurred prior to such
date, on the third Business Day immediately preceding the Purchase
Contract Settlement Date (the “ Final Remarketing Date
”), the Remarketing Agent shall use its reasonable efforts to
remarket (the “ Final Remarketing ”) the
Remarketed Senior Notes at the Remarketing Price. It is understood
and agreed that the Remarketing on any Remarketing Date will be
considered successful and no further attempts will be made if the
resulting proceeds are at least equal to the Remarketing
Price.
(d) In connection with each
Remarketing, the Remarketing Agent shall determine, in consultation
with the Company, the rate per annum, rounded to the nearest
one-thousandth (0.001) of one percent per annum, that the Senior
Notes should bear (the “ Reset Rate ”) in order
for the Remarketed Senior Notes to have an aggregate market value
equal to the Remarketing Price and that in the sole reasonable
discretion of the Remarketing Agent will enable it to remarket all
of the Remarketed Senior Notes at the Remarketing Price in such
Remarketing; provided that such rate shall not exceed the
maximum interest rate permitted by applicable law.
(e) If, by 4:00 p.m., New York City
time, on the applicable Remarketing Date, (1) the Remarketing Agent
is unable to remarket all of the Remarketed Senior Notes, other
than to the Company, at the Remarketing Price pursuant to the terms
and conditions hereof or (2) the Remarketing did not occur on such
Remarketing Date because one of the conditions set forth in Section
6 hereof was not satisfied, a Failed Remarketing shall be deemed to
have occurred, and the Remarketing Agent shall advise by telephone
the Depositary, the Purchase Contract Agent, the Collateral Agent
and the Company. Whether or not there has been a Failed Remarketing
will be determined in the sole reasonable discretion of the
Remarketing Agent.
(f) In the event of a Successful
Remarketing, by approximately 4:30 p.m., New York City time, on the
applicable Remarketing Date, the Remarketing Agent shall advise, by
telephone (promptly confirmed in writing in the case of clause
(1)):
(1) the Depositary, the Purchase
Contract Agent, the Trustee and the Company of the Reset Rate
determined by the Remarketing Agent in such Remarketing and the
number of Remarketed Senior Notes sold in such
Remarketing;
(2) each purchaser (or the
Depositary Participant thereof) of Remarketed Senior Notes of the
Reset Rate and the number of Remarketed Senior Notes such purchaser
is to purchase;
(3) each such purchaser (if other
than a Depositary Participant) to give instructions to its
Depositary Participant to pay the purchase price on the Remarketing
Settlement Date in same day funds against delivery of the
Remarketed Senior Notes purchased through the facilities of the
Depositary; and
(4) each such purchaser (or
Depositary Participant thereof) that the Remarketed Senior Notes
will not be delivered until the Remarketing Settlement Date, and,
in the case of the Initial Remarketing Date or the Second
Remarketing, the Remarketing Settlement Date will be five Business
Days or four Business Days, respectively, following the date of
such Remarketing and that if such purchaser wishes to trade the
Remarketed Senior Notes that it has purchased prior to the third
Business Day preceding the Remarketing Settlement Date, such
purchaser will have to specify an alternative settlement cycle at
the time of any such trade to prevent failed settlement.
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The Remarketing Agent shall also, if
required by the Securities Act, deliver, in conformity with the
requirements of the Securities Act, to each purchaser a Prospectus
in connection with the Remarketing.
(g) The proceeds from a Successful
Remarketing (i) with respect to the Senior Notes underlying the
Applicable Ownership Interests in Senior Notes that are components
of the Corporate Units shall be paid to the Collateral Agent in
accordance with Section 5.02 of the Purchase Contract and Pledge
Agreement and (ii) with respect to the Separate Senior Notes, shall
be paid to the Custodial Agent for payment to the holders of such
Separate Senior Notes in accordance with Section 5.02 of the
Purchase Contract and Pledge Agreement.
(h) The right of each holder of
Remarketed Senior Notes to have such Remarketed Senior Notes
remarketed and sold on any Remarketing Date shall be subject to the
conditions that (i) the Remarketing Agent conducts (A) an Initial
Remarketing, (B) a Second Remarketing in the event of a Failed
Remarketing on the Initial Remarketing Date and (C) a Final
Remarketing in the event of a Failed Remarketing on the Second
Remarketing Date, each pursuant to the terms of this Agreement,
(ii) neither a Special Event Redemption nor a Termination Event has
occurred prior to such Remarketing Date, (iii) the Remarketing
Agent is able to find a purchaser or purchasers for Remarketed
Senior Notes at the Remarketing Price based on the Reset Rate, and
(iv) such purchaser or purchasers of the Remarketed Senior Notes
deliver the purchase price therefor to the Remarketing Agent as and
when required.
(i) It is understood and agreed that
the Remarketing Agent shall not have any obligation whatsoever to
purchase any Remarketed Senior Notes, whether in the Remarketing or
otherwise, and shall in no way be obligated to provide funds to
make payment upon tender of Remarketed Senior Notes for Remarketing
or to otherwise expend or risk its own funds or incur or to be
exposed to financial liability in the performance of its duties
under this Agreement. Neither the Company nor the Remarketing Agent
shall be obligated in any case to provide funds to make payment
upon tender of the Remarketed Senior Notes for
Remarketing.
Section 3. Representations and
Warranties of the Company . The Company represents and warrants
(i) on and as of the date any Remarketing Materials are first
distributed in connection with the Remarketing (the “
Commencement Date ”), (ii) on and as of the applicable
Remarketing Date and (iii) on and as of the Remarketing Settlement
Date, that:
(a) Each of the representations and
warranties of the Company as set forth in Sections 1(c) through
1(i), Sections 1(m) through 1(r) and Sections 1(u) through 1(w) of
the Underwriting Agreement dated March 23, 2005 (the “
Underwriting Agreement ”) among the Company and Banc
of America Securities LLC, J.P. Morgan Securities Inc. and Morgan
Stanley & Co. Incorporated, as Representatives of the
Underwriters identified in Schedule II thereto, is true and correct
as if made on each of the dates specified above; provided
that for purposes of this Section 3(a), any reference in such
sections of the Underwriting Agreement to (i) the
“Registration Statements”, the “Prospectus”
and the “Preliminary Prospectus” shall be deemed to
refer to the correlative terms as defined herein, (ii) the
“Closing Date” shall be deemed to refer to the
Remarketing Settlement Date, (iii) the “Securities”
shall be deemed to refer to the Remarketed Senior Notes, and (iv)
“this Agreement” and “Date of Delivery”
shall be ignored.
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(b) The Registration Statement, if
any, has been declared effective by the Commission; and no stop
order suspending the effectiveness of the Registration Statement
has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission.
(c) The documents incorporated by
reference in the Prospectus, when they were filed with the
Commission, conformed in all material respects to the requirements
of the Exchange Act and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; and any further documents so filed and
incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents are filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act, and will not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided , however , that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
relating to the Remarketing Agent furnished in writing to the
Company by the Remarketing Agent expressly for use in the
Registration Statement or the Remarketing Documents.
(d) The Registration Statement, if
any, as of the effective date, conformed (and the Preliminary
Prospectus and the Prospectus, if any, and any further amendments
or supplements to the Registration Statement or the Prospectus,
when they become effective or are filed with the Commission, as the
case may be, will conform) in all material respects to the
requirements of the Securities Act, and the Registration Statement
and the Remarketing Materials (and any amendment or supplement
thereto) as of their respective effective or filing date (or, with
respect to the Registration Statement, if later, the filing of the
Company’s latest Annual Report on Form 10-K) and as of the
applicable Remarketing Date and Remarketing Settlement Date do not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading; provided that no
representation and warranty is made as to any statement of
eligibility on Form T-1 filed or incorporated by reference as part
of the Registration Statement or the Remarketing Materials, or as
to information relating to the Remarketing Agent contained in or
omitted from the Registration Statement or the Remarketing
Materials in reliance upon and in conformity with written
information furnished to the Company by the Remarketing
Agent.
(e) No consent, approval,
authorization, filing with or order of any court or governmental
agency or body is required for the Remarketing or the consummation
by the Company of the transactions contemplated by the Transaction
Documents except such as may be or have been obtained under the
Securities Act, the TIA and the Public Utility Holding Company Act
of 1935 and such as may be required under the blue sky laws of any
jurisdiction in connection with the Remarketing.
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(f) The Company is not required to
register as an “investment company” as such term is
defined in the Investment Company Act of 1940, as
amended.
Section 4. Fees . In the
event of a Successful Remarketing of the Remarketed Senior Notes,
the Company shall pay the Remarketing Agent a remarketing fee equal
to 0.25% of the principal amount of the Remarketed Senior Notes
(the “ Remarketing Fee ”). Such Remarketing Fee
shall be paid by the Company on the Remarketing Settlement Date in
cash by wire transfer of immediately available funds to an account
designated by the Remarketing Agent.
Section 5. Covenants of the
Company . The Company covenants and agrees as
follows:
(a) If and to the extent the
Remarketed Senior Notes are required (in the view of counsel, which
need not be in the form of a written opinion, for either the
Remarketing Agent or the Company) to be registered under the
Securities Act as in effect at the time of the
Remarketing,
(1) to prepare the Registration
Statement and the Prospectus, in a form approved by the Remarketing
Agent, to file any such Prospectus pursuant to the Securities Act
within the period required by the Securities Act and the rules and
regulations thereunder and to use commercially reasonable efforts
to cause the Registration Statement to be declared effective by the
Commission prior to the second Business Day immediately preceding
the applicable Remarketing Date;
(2) to file promptly with the
Commission any amendment to the Registration Statement or the
Prospectus or any supplement to the Prospectus that may, in the
reasonable judgment of the Company or the Remarketing Agent, be
required by the Securities Act or requested by the
Commission;
(3) to advise the Remarketing Agent,
promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Remarketing Agent with
copies thereof;
(4) to file promptly all reports and
any definitive proxy or information statements required to be filed
by the Company with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
the Prospectus and for so long as the delivery of a Prospectus is
required in connection with the offering or sale of the Remarketed
Senior Notes;
(5) to advise the Remarketing Agent,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or
suspending the use of the Prospectus, of the suspension of the
qualification of any of the Remarketed Senior Notes for offering or
sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration
Statement or the Prospectus or for additional information, and, in
the event of the issuance of any stop order or of any order
preventing or suspending the use of any Prospectus or suspending
any such qualification, to use promptly its best efforts to obtain
its withdrawal;
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(6) to furnish promptly to the
Remarketing Agent such copies of the following documents as the
Remarketing Agent shall reasonably request: (A) conformed copies of
the Registration Statement as originally filed with the Commission
and each amendment thereto (in each case excluding exhibits); (B)
the Preliminary Prospectus and any amended or supplemented
Preliminary Prospectus; (C) the Prospectus and any amended or
supplemented Prospectus; and (D) any document incorporated by
reference in the Prospectus (excluding exhibits thereto); and, if
at any time when delivery of a prospectus is required in connection
with the Remarketing, any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include
any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or if for any other reason
it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any
document incorporated by reference in the Prospectus in order to
comply with the Securities Act or the Exchange Act, to notify the
Remarketing Agent and, upon its request, to file such document and
to prepare and furnish without charge to the Remarketing
A
