f8k_031309pnmr.htm

0001108426-09-000027.txt : 20090313 0001108426-09-000027.hdr.sgml : 20090313 20090313163533 ACCESSION NUMBER: 0001108426-09-000027 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20090313 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20090313 DATE AS OF CHANGE: 20090313 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TEXAS NEW MEXICO POWER CO CENTRAL INDEX KEY: 0000022767 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 750204070 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 002-97230 FILM NUMBER: 09680566 BUSINESS ADDRESS: STREET 1: 4100 INTERNATIONAL PLZ STREET 2: PO BOX 2943 CITY: FORT WORTH STATE: TX ZIP: 76113 BUSINESS PHONE: 8177310099 MAIL ADDRESS: STREET 1: 4100 INTERNATIONAL PLAZA STREET 2: PO BOX 2943 CITY: FORT WORTH STATE: TX ZIP: 76113 FORMER COMPANY: FORMER CONFORMED NAME: COMMUNITY PUBLIC SERVICE CO DATE OF NAME CHANGE: 19810617 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PNM RESOURCES INC CENTRAL INDEX KEY: 0001108426 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 850019030 STATE OF INCORPORATION: NM FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32462 FILM NUMBER: 09680565 BUSINESS ADDRESS: STREET 1: ALVARADO SQUARE STREET 2: NEW MEXICO CITY: ALBUQUERQUE STATE: NM ZIP: 87158 BUSINESS PHONE: 5052412700 MAIL ADDRESS: STREET 1: ALVARADO SQUARE CITY: ALBUQUERQUE STATE: NM ZIP: 87158 FORMER COMPANY: FORMER CONFORMED NAME: MANZANO CORP DATE OF NAME CHANGE: 20000303 8-K 1 f8k_031309pnmr.htm FORM 8-K f8k_031309pnmr.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported)	March 13, 2009
	(March 10, 2009)


Commission	Name of Registrants, State of Incorporation,	I.R.S. Employer
File Number	Address and Telephone Number	Identification No.
001-32462	PNM Resources, Inc.	85-0468296
	(A New Mexico Corporation)
	Alvarado Square
	Albuquerque, New Mexico 87158
	(505) 241-2700

002-97230	Texas-New Mexico Power Company	75-0204070
	(A Texas Corporation)
	577 North Garden Ridge Blvd.
	Lewisville, Texas 75067
	(972) 420-4189

______________________________

(Former name, former address and former fiscal year, if changed since last report) Texas-New Mexico Power Company 4100 International Plaza P.O. Box 2943 Fort Worth, Texas 76113 (817) 731-0099

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)

o	Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4(c)

Item 1.01 Entry into a Material Definitive Agreement.

On August 15, 2005, PNM Resources, Inc. (“PNMR”) executed an amended and restated $600 million unsecured credit agreement, which has subsequently been amended (as amended, the “PNMR Credit Agreement”). Other parties to the PNMR Credit Agreement include the lenders party thereto and Bank of America, N.A. as administrative agent.

On May 15, 2008, Texas-New Mexico Power Company (“TNMP”), an indirect wholly owned subsidiary of PNMR, entered into a $200 million unsecured credit agreement, which has subsequently been amended (as amended, the “TNMP Revolving Credit Agreement”). Other parties to the TNMP Revolving Credit Agreement include the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent.

On March 10, 2009, the TNMP Revolving Credit Agreement was amended in certain respects by an Amendment No. 2 (the “TNMP Amendment 2”), and on March 11, 2009, the PNMR Credit Agreement was amended in certain respects by a Third Amendment (the “PNMR Amendment 3”), in each case, to accommodate certain proposed future financings by TNMP. TNMP Amendment 2 also contains an agreement by TNMP to reduce the size of the TNMP Revolving Credit agreement from $200 million to $75 million upon the occurrence of certain future financings. This description of PNMR Amendment 3 and TNMP Amendment 2 is qualified in its entirety by reference to the full text of the PNMR Amendment 3 and TNMP Amendment 2, copies of which are filed as Exhibit 10.1 and 10.2, hereto, and are incorporated by reference herein.

Item 9.01. Financial Statements and Exhibits.

Exhibit Number		Exhibit
10.1		Third Amendment to Credit Agreement, dated as of March 11, 2009, among PNM Resources, Inc., First Choice Power, L.P., the lenders party thereto, and Bank of America, N.A., as Administrative Agent for the Lenders
10.2		Amendment No. 2 to Credit Agreement, dated as of March 10, 2009, by and among Texas-New Mexico Power Company, as Borrower, the institutions from time to time parties thereto as Lenders, and JPMorgan Chase Bank, N.A., in its capacity as Administrative Agent for itself and the other Lenders

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.


	PNM RESOURCES, INC. TEXAS-NEW MEXICO POWER COMPANY (Registrants)


Date: March 13, 2009	/s/ Thomas G. Sategna
	Thomas G. Sategna Vice President and Corporate Controller (Officer duly authorized to sign this report)

EX-10.1 2 exh10-1_031309.htm EXHIBIT 10.1 exh10-1_031609.htm

Exhibit 10.1

THIRD AMENDMENT TO CREDIT AGREEMENT

THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is entered into as of March __, 2009 among PNM RESOURCES, INC., a New Mexico corporation (the "Company"), FIRST CHOICE POWER, L.P., a Texas limited partnership ("FCP", collectively with the Company, the "Borrowers"), the Lenders party hereto, and BANK OF AMERICA, N.A., as Administrative Agent for the Lenders (in such capacity, the "Administrative Agent"). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Credit Agreement (as defined below).

R E C I T A L S

WHEREAS, the Borrowers, the Lenders party thereto and the Administrative Agent are parties to that certain Amended and Restated Credit Agreement, dated as of August 15, 2005 (as amended or modified from time to time, the "Credit Agreement");

WHEREAS, Texas-New Mexico Power Company ("TNMP"), a Subsidiary of the Company, wishes to incur certain secured Indebtedness; and

WHEREAS, the Borrowers have requested that the Administrative Agent and Lenders agree to certain changes to the Credit Agreement to accommodate the incurrence of such secured Indebtedness.

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

A G R E E M E N T

1. Amendments.

(a) Section 1.1. The following new definition "TNMP First Mortgage Bonds" is hereby added to Section 1.1 of the Credit Agreement in the appropriate alphabetical order:

"TNMP First Mortgage Bonds" means those certain first mortgage bonds issued pursuant to the First Mortgage Indenture substantially in the form of the draft dated March 4, 2009 and dated on or before April 1, 2009, between TNMP and The Bank of New York Mellon Trust Company, N.A., as trustee thereunder, as it may be supplemented and amended from time to time so long as such supplements or amendments do not cause a Default under this Agreement.

(b) Section 8.5. Section 8.5 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

8.5 Liens.

Such Borrower will not (nor will it permit its Subsidiaries to) contract, create, incur, assume or permit to exist any Lien with respect to any of its property or assets of any kind (whether real or personal, tangible or intangible), whether now owned or

hereafter acquired, securing any Indebtedness other than the following: (a) Liens securing Borrower Obligations, (b) Liens for taxes not yet due or Liens for taxes being contested in good faith by appropriate proceedings for which adequate reserves determined in accordance with GAAP have been established (and as to which the property subject to any such Lien is not yet subject to foreclosure, sale or loss on account thereof), (c) Liens in respect of property imposed by law arising in the ordinary course of business such as materialmen's, mechanics', warehousemen's, carrier's, landlords' and other nonconsensual statutory Liens which are not yet due and payable, which have been in existence less than 90 days or which are being contested in good faith by appropriate proceedings for which adequate reserves determined in accordance with GAAP have been established (and as to which the property subject to any such Lien is not yet subject to foreclosure, sale or loss on account thereof), (d) pledges or deposits made in the ordinary course of business to secure payment of worker's compensation insurance, unemployment insurance, pensions or social security programs, (e) Liens arising from good faith deposits in connection with or to secure performance of tenders, bids, leases, government contracts, performance and return-of-money bonds and other similar obligations incurred in the ordinary course of business (other than obligations in respect of the payment of borrowed money), (f) Liens arising from good faith deposits in connection with or to secure performance of statutory obligations and surety and appeal bonds, (g) easements, rights-of-way, restrictions (including zoning restrictions), minor defects or irregularities in title and other similar charges or encumbrances not, in any material respect, impairing the use of the encumbered property for its intended purposes, (h) judgment Liens that would not constitute an Event of Default, (i) Liens arising by virtue of any statutory or common law provision relating to banker's liens, rights of setoff or similar rights as to deposit accounts or other funds maintained with a creditor depository institution, (j) any Lien created or arising over any property which is acquired, constructed or created by such Borrower or its Subsidiaries, but only if (i) such Lien secures only principal amounts (not exceeding the cost of such acquisition, construction or creation) raised for the purposes of such acquisition, construction or creation, together with any costs, expenses, interest and fees incurred in relation thereto or a guarantee given in respect thereof, (ii) such Lien is created or arises on or before 180 days after the completion of such acquisition, construction or creation, (iii) such Lien is confined solely to the property so acquired, constructed or created and any improvements thereto and (iv) the aggregate principal amount of all Indebtedness at any one time outstanding that is secured by such Liens shall not exceed (A) in the case of the Company and its Subsidiaries, $50,000,000 and (B) in the case of any other Borrower and its Subsidiaries, $25,000,000, (k) any Lien on Margin Stock, (l) Liens with respect to the Indebtedness evidenced by the FMB Indenture, but only to the extent of the Insured Series First Mortgage Bonds, and the "permitted encumbrances" under the FMB Indenture, (m) with respect to the Company and PSNM, the assignment of, or Liens on, accounts receivable in connection with PSNM Accounts Receivable Securitization and the filing of related financing statements under the Uniform Commercial Code of the applicable jurisdictions, (n) with respect to First Choice, (i) the assignment of, or Liens on, accounts receivable in connection with First Choice Securitization and the filing of related financing statements under the Uniform Commercial Code of the applicable jurisdictions and (ii) other Liens in connection with the Constellation Agreement, (o) the assignment of, or Liens on, demand, energy or wheeling revenues, or on capacity reservation or option fees, payable to such Borrower or any of its Subsidiaries with respect to any wholesale electric service or transmission agreements, the assignment of, or Liens on, revenues from energy services contracts, and the assignment of, or Liens on,

capacity reservation or option fees payable to such Borrower or such Subsidiary with respect to asset sales permitted herein, (p) Liens on assets of TNMP securing the TNMP First Mortgage Bonds in an aggregate principal amount not to exceed $400,000,000 at any one time, (q) any extension, renewal or replacement (or successive extensions, renewals or replacements), as a whole or in part, of any Liens referred to in the foregoing clauses (a) through (p), for amounts not exceeding the principal amount of the Indebtedness secured by the Lien so extended, renewed or replaced, provided that such extension, renewal or replacement Lien is limited to all or a part of the same property or assets that were covered by the Lien extended, renewed or replaced (plus improvements on such property or assets), (r) Liens on Property that is subject to a Material Lease that is classified as an operating lease as of the Closing Date but which is subsequently converted into a capital lease, (s) Liens securing obligations under Hedging Agreements entered into in the ordinary course of business and not for speculative purposes, (t) Liens granted by bankruptcy-remote special purpose Subsidiaries to secure stranded cost securitization bonds, and (u) Liens on Property, in addition to those otherwise permitted by clauses (a) through (t) above, securing, directly or indirectly, Indebtedness or obligations of such Borrower and its Subsidiaries arising pursuant to other agreements entered into in the ordinary course of business which do not exceed, in the aggregate at any one time outstanding, (i) in the case of the Company and its Subsidiaries, $50,000,000 and (ii) in the case of any other Borrower and its Subsidiaries, $25,000,000.

2. Conditions Precedent. This Amendment shall be effective upon satisfaction of the following conditions precedent:

(a) Receipt by the Administrative Agent of documentation evidencing the TNMP First Mortgage Bonds on terms satisfactory to the Administrative Agent;

(b) Receipt by the Administrative Agent of copies of this Amendment duly executed by each Borrower and the Required Lenders; and

(c) Payment to each Lender (other than a Defaulting Lender) executing this Amendment on or prior to March 3, 2009 of an amendment fee equal to .10% of such Lender's Commitment.

3. Ratification of Credit Agreement. The term "Credit Agreement" as used in each of the Credit Documents shall hereafter mean the Credit Agreement as amended by this Amendment. Except as herein specifically agreed, the Credit Agreement is hereby ratified and confirmed and shall remain in full force and effect according to its terms.

4. Authority/Enforceability. Each Borrower represents and warrants as follows:

(a) It has taken all necessary action to authorize (i) the execution, delivery and performance of this Amendment and (ii) the incurrence of the Indebtedness evidenced by the TNMP First Mortgage Bonds.

(b) This Amendment has been duly executed and delivered by such Person and constitutes such Person's legal, valid and binding obligations, enforceable in accordance with its terms, except as such enforceability may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or similar laws affecting creditors' rights

generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity).

(c) No consent, approval, authorization or order of, or filing, registration or qualification with, any court or governmental authority or third party is required in connection with the execution, delivery or performance by such Person of this Amendment.

5. Representations and Warranties. Each Borrower represents and warrants to the Lenders that (a) the representations and warranties of such Borrower set forth in Section 6 of the Credit Agreement are true and correct as of the date hereof, unless they specifically refer to an earlier date, (b) no event has occurred and is continuing which constitutes a Default or an Event of Default, and (c) it has no claims, counterclaims, offsets, credits or defenses to its obligations under the Credit Documents or to the extent it has any they are hereby released in consideration of the Lenders entering into this Amendment.

6. No Conflicts. Neither the execution and delivery of this Amendment, nor the consummation of the transactions contemplated herein, nor performance of and compliance with the terms and provisions hereof by any Borrower will (a) violate, contravene or conflict with any provision of its respective articles or certificate of incorporation, bylaws or other organizational or governing document, (b) violate, contravene or conflict with any law, rule, regulation, order, writ, judgment, injunction, decree or permit applicable to a Borrower, (c) violate, contravene or conflict with contractual provisions of, or cause an event of default under, any indenture, loan agreement, mortgage, deed of trust, contract or other agreement or instrument to which a Borrower is a party or by which it or its properties may be bound or (d) result in or require the creation of any Lien upon or with respect to a Borrower's properties.

7. Counterparts/Telecopy. This Amendment may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. Delivery of executed counterparts by telecopy shall be effective as an original.

8. GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

[remainder of page intentionally left blank]

Each of the parties hereto has caused a counterpart of this Amendment to be duly executed and delivered as of the date first above written.

BORROWERS: PNM RESOURCES, INC.,

a New Mexico corporation

By: /s/ Terry R. Horn

Name: Terry R. Horn

Title: Vice President and Treasurer

FIRST CHOICE POWER, L.P.,

a Texas limited partnership

By: First Choice Power GP, LLC,

its general partner

By: /s/ Terry R. Horn

Name: Terry R. Horn

Title: Vice President and Treasurer

ADMINISTRATIVE

AGENT: BANK OF AMERICA, N.A.,

as Administrative Agent

By: /s/ Richard L. Stein

Name: Richard L. Stein

Title: Senior Vice President

PNM RESOURCES, INC.

THIRD AMENDMENT TO CREDIT AGREEMENT

LENDERS: BANK OF AMERICA, N.A.,

as a Lender and L/C Issuer

By: /s/ Richard L. Stein

Name: Richard L. Stein

Title: Senior Vice President

WACHOVIA BANK, NATIONAL ASSOCIATION,

as a Lender and L/C Issuer

By: /s/ Frederick W. Price

Name: Frederick W. Price

Title: Managing Director

UNION BANK OF CALIFORNIA, N.A.

By: /s/ Efrain Soto

Name: Efrain Soto

Title: Vice President

JPMORGAN CHASE BANK, N.A.

By: /s/ Helen D. Davis

Name: Helen D. Davis

Title: Vice President

CITIBANK, N.A.

By: /s/ Todd C. Davis

Name: Todd C. Davis

Title: Director, Global Power

WELLS FARGO BANK, N.A.

By: /s/ Yann Blindert

Name: Yann Blindert

Title: Assistant Vice President

PNM RESOURCES, INC.

THIRD AMENDMENT TO CREDIT AGREEMENT

MERRILL LYNCH BANK USA

By: /s/ Louis Adler

Name: Louis Adler

Title: First Vice President

MORGAN STANLEY BANK

By: /s/ Melissa James

Name: Melissa James

Title: Authorized Signatory

UBS LOAN FINANCE LLC

By: /s/ Irja R. Otsa /s/ Mary E. Evans

Name: Irja R. Otsa Mary E. Evans

Title: Associate Director Associate Director

LEHMAN BROTHERS BANK, FSB

By: ________________________________

Name: ________________________________

Title: ________________________________

WILLIAM STREET COMMITMENT CORPORATION

By: /s/ Mark Walton

Name: Mark Walton

Title: Assistant Vice President

CREDIT SUISSE, CAYMAN ISLANDS BRANCH

By: /s/ James Moran /s/ Nupur Kumar

Name: James Moran Nupur Kumar

Title: Managing Director Vice President

PNM RESOURCES, INC.

THIRD AMENDMENT TO CREDIT AGREEMENT

U S BANK NATIONAL ASSOCIATION

By: ______________________________

Name: ______________________________

Title: ______________________________

HSBC BANK USA, NATIONAL ASSOCIATION

By: ______________________________

Name: ______________________________

Title: ______________________________

THE BANK OF NEW YORK MELLON

By: /s/ Mark W. Rogers

Name: Mark W. Rogers

Title: Vice President

ROYAL BANK OF CANADA

By: ______________________________

Name: ______________________________

Title: ______________________________

COMPASS BANK

By: ______________________________

Name: ______________________________

Title: ______________________________

SOUTHWEST SECURITIES BANK

By: /s/ Lonnie Warren

Name: Lonnie Warren

Title: Regional President

PNM RESOURCES, INC.

THIRD AMENDMENT TO CREDIT AGREEMENT

BANK OF ALBUQUERQUE, N.A.

By: _____________________________

Name: _____________________________

Title: _____________________________

BANK HAPOALIM BM

By: ______________________________

Name: ______________________________

Title: ______________________________

PNM RESOURCES, INC.

THIRD AMENDMENT TO CREDIT AGREEMENT

EX-10.2 3 exh10-2_031309.htm EXHIBIT 10.2 exh10-2_031609.htm

Exhibit 10.2

AMENDMENT NO. 2

CREDIT AGREEMENT

THIS AMENDMENT NO. 2 TO CREDIT AGREEMENT (the “Amendment”) is made as of March 10, 2009 by and among TEXAS-NEW MEXICO POWER COMPANY (the “Borrower”), the institutions from time to time parties thereto as Lenders (the “Lenders”), and JPMORGAN CHASE BANK, N.A., in its capacity as Administrative Agent for itself and the other Lenders (the “Administrative Agent”) under that certain Credit Agreement dated as of May 15, 2008 by and among the Borrower, the financial institutions party thereto, and the Administrative Agent (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”). Defined terms used herein and not otherwise defined herein shall have the meaning given to them in the Credit Agreement.

WITNESSETH

WHEREAS, the Borrower, the Lenders, and the Administrative Agent are parties to the Credit Agreement; and

WHEREAS, the Borrower has requested that the Administrative Agent and the requisite number of Lenders under Section 11.6 of the Credit Agreement amend the Credit Agreement on the terms and conditions set forth herein; and

WHEREAS, the Borrower, the requisite number of Lenders under Section 11.6 of the Credit Agreement and the Administrative Agent have agreed to amend the Credit Agreement on the terms and conditions set forth herein;

NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto have agreed to the following amendments to the Credit Agreement:

1. Amendments to the Credit Agreement. Effective as of March 10, 2009 (the “Effective Date”) and subject to the satisfaction of the condition precedent set forth in Section 2 below, the Credit Agreement is hereby amended as follows:

1.1.	Section 1.1 to the Credit Agreement is amended to insert the following definitions in alphabetical order:

“First Mortgage Bond Trustee” has the meaning set forth in the definition of “Note Facilities Documentation”.

“1999 Indenture” has the meaning set forth in the definition of “Note Facilities Documentation”.

“2009 Term Loan Credit Agreement” means a term loan credit agreement to be dated on or before April 1, 2009, between the Borrower and one or more lenders parties thereto, including Union Bank, N.A. or any of its affiliates, individually and/or as agent on behalf of such lenders, as it may be amended, supplemented, extended or otherwise modified form time to time; provided that the Administrative Agent and the Lenders shall have received satisfactory evidence that all of the obligations outstanding under the 2008 Term Loan Credit Agreement shall have been paid in full in cash, and the 2008 Term Loan Credit Agreement shall have been terminated, prior to or substantially concurrently with the initial incurrence of Indebtedness pursuant to the 2009 Term Loan Credit Agreement.

1.2.	Section 1.1 to the Credit Agreement is hereby amended to delete the definition of “Note Facilities Documentation” in its entirety, and to substitute the following therefor:

“Note Facilities Documentation” means (1) the First Mortgage Indenture dated on or before April 1, 2009, between the Borrower and The Bank of New York Mellon Trust Company, N.A., as Trustee (together with its permitted successors and assigns in such capacity, the “First Mortgage Bond Trustee”), the First Supplemental Indenture dated on or before April 1, 2009 issued pursuant thereto and any other supplemental indentures, notes or other securities issued pursuant thereto or in connection therewith, as the same may be amended, supplemented, extended or otherwise modified from time to time, and/or (2) the Indenture dated as of January 1, 1999, between the Borrower and The Bank of New York Trust Company, N.A. (as successor to JPMorgan Chase Bank, N.A., formerly JPMorgan Chase Bank, as successor to Chase Bank of Texas, N.A.), as Trustee (the “1999 Indenture”), the Third Supplemental Indenture issued pursuant thereto and any other supplemental indentures, notes or other securities issued pursuant thereto or in connection therewith, as the same may be amended, supplemented, extended or otherwise modified from time to time; provided that the Administrative Agent and the Lenders shall have received satisfactory evidence that all of the obligations outstanding under the 2008 Term Loan Credit Agreement shall have been paid in full in cash, and the 2008 Term Loan Credit Agreement shall have been terminated, prior to or substantially concurrently with the initial incurrence of Indebtedness pursuant to the Note Facilities Documentation.

1.3.	Section 8.5 to the Credit Agreement is hereby amended to delete subclause (q) thereof in its entirety, and to substitute the following therefor:

(q) Liens upon any property in favor of the First Mortgage Bond Trustee securing Indebtedness under the Note Facilities Documentation and/or the 2009 Term Loan Credit Agreement; provided that in the event that the aggregate principal amount of Indebtedness secured by such Liens shall exceed $318,000,000 (i) the Borrower Obligations shall concurrently be secured equally and ratably with (or prior to) such Indebtedness so long as such other Indebtedness shall be secured and (ii) the Borrower, the First Mortgage Bond Trustee and the Administrative Agent, for the benefit of the Lenders, shall have entered into such supplemental indentures and other documentation deemed necessary by the Administrative Agent in respect of such Lien on terms and

conditions acceptable to the Administrative Agent (including, without limitation, with respect to the voting of claims and release or modification of any such Lien on all or any portion of the collateral thereunder), and

1.4.	Section 8.7 to the Credit Agreement is hereby amended to delete the current Section 8.7 in its entirety and to substitute the following new Section 8.7 therefor:

The Borrower will not (nor will it permit any of its Subsidiaries to) enter into any contractual obligation that limits the ability (a) of any Subsidiary of the Borrower to make Restricted Payments to the Borrower or to otherwise transfer property to the Borrower or (b) of the Borrower to create, incur, assume or suffer to exist Liens on its property in favor of the Administrative Agent, for the benefit of the Lenders, other than (i) any such contractual obligation contained in the Credit Documents; (ii) any such contractual obligation contained in the “Credit Documents” as defined in the 2008 Term Loan Credit Agreement (as such contractual obligations in such “Credit Documents” exist as of the date hereof without giving effect to any subsequent amendment or other modification to such contractual obligations); (iii) any such contractual obligation contained in the “Credit Documents” (or any similar term) defined in the 2009 Term Loan Credit Agreement to the extent such contractual obligations in such “Credit Documents” (or any similar term) shall be no less favorable to the Administrative Agent and the Lenders than such contractual obligations set forth in the 2008 Term Loan Credit Agreement as of the date hereof without giving effect to any subsequent amendment or other modification to such contractual obligations; and (iv) any such contractual obligation contained in the Note Facilities Documentation (which contractual obligation shall be on terms no less favorable to the Administrative Agent and the Lenders than such contractual obligations set forth in the 1999 Indenture, the draft Third Supplemental Indenture thereto (draft stamp: “Draft of 2/13/2009 61544.5”) as provided to the Administrative Agent and the lenders on February 18, 2008, and the draft First Mortgage Indenture (draft stamp: “TS Draft 03/04/09” and “2018235 v.9”) as provided to the Administrative Agent and the Lenders on March 4, 2009, without giving effect to any amendment or other modification to such contractual obligations).

2. Conditions of Effectiveness. The effectiveness of this Amendment is subject to the conditions precedent that the Administrative Agent shall have received the following:

(A)	duly executed originals of this Amendment from the Borrower, the requisite number of Lenders under Section 11.6 of the Credit Agreement and the Administrative Agent;

(B)	the Amendment Fee (as defined below) payable for the account of each Lender executing this Amendment; and

(C)	such other documents, instruments and agreements as the Administrative Agent may reasonably request.

3. Amendment Fee. Each Lender that delivers a duly executed signature page to this Amendment to the Administrative Agent’s counsel, Sidley Austin LLP, Attention: Praju Tuladhar, by facsimile or e-mail PDF copy (fax: 312-853-7036; e-mail: ptuladhar

@sidley.com) by such time as requested by the Administrative Agent, shall be entitled to an amendment fee (the “Amendment Fee”) equal to 0.10% (10 basis points) multiplied by such consenting Lender’s Commitment (calculated after giving effect to the reductions set forth in Section 4 below).

4. Reductions of Commitments. The Borrower has notified the Administrative Agent and the Lenders of its desire to permanently reduce the Revolving Committed Amount to $75,000,000 in accordance with Section 2.1(d) of the Credit Agreement. On the terms set forth herein, effective as of the date of, and substantially concurrently with, the initial incurrence of Indebtedness pursuant to the Note Facilities Documentation (as such term is defined after giving effect to this Amendment), Schedule 1.1(a) of the Credit Agreement is hereby amended and restated in its entirety as set forth on Attachment A attached hereto.

5. Representations and Warranties of the Borrower.

(A)

The Borrower hereby represents and warrants that (i) this Amendment and the Credit Agreement, as previously executed and as amended hereby, constitute legal, valid and binding obligations of the Borrower and are enforceable against the Borrower in accordance with their terms (except as enforceability may be limited by bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally) and (ii) no Default or Event of Default has occurred and is continuing.

(B)

Upon the effectiveness of this Amendment and after giving effect hereto, the Borrower hereby reaffirms all covenants, representations and warranties made in the Credit Agreement as amended hereby, and agrees that all such covenants, representations and warranties shall be true and correct as of the effective date of this Amendment (unless such representation and warranty is made as of a specific date, in which case such representation and warranty shall be true and correct as of such date).

6. References to the Credit Agreement.

(A)

Upon the effectiveness of Section 1 hereof, on and after the date hereof, each reference in the Credit Agreement (including any reference therein to “this Credit Agreement,” “hereunder,” “hereof,” “herein” or words of like import referring thereto) or in any other Credit Document shall mean and be a reference to the Credit Agreement as amended hereby.

(B)	Except as specifically amended above, the Credit Agreement and all other documents, instruments and agreements executed and/or delivered in connection therewith, shall remain in full force and effect, and are hereby ratified and confirmed.

(C)

The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement or any other documents, instruments and agreements executed and/or delivered in connection therewith.

7. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.

8. Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

9. Counterparts. This Amendment may be executed by one or more of the parties to this Amendment on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written.

BORROWER:

TEXAS-NEW MEXICO POWER COMPANY

a Texas corporation

By: /s/ Terry R. Horn

Name: Terry R. Horn

Title: Vice President & Treasurer

Signature Page to Amendment No. 2

LENDERS:

JPMORGAN CHASE BANK, N.A.,

individually in its capacity as a Lender and in

its capacity as Administrative Agent and L/C Issuer

By: /s/ Helen D. Davis

Name: Helen D. Davis

Title: Vice President

UNION BANK OF CALIFORNIA, N.A.,

individually in its capacity as a Lender and in its capacity as Syndication Agent

By: /s/ Efrain Soto

Name: Efrain Soto

Title: Vice President

Signature Page to Amendment No. 2

SUNTRUST BANK,

individually in its capacity as a Lender

By: /s/ Andrew Johnson

Name: Andrew Johnson

Title: Director

Signature Page to Amendment No. 2

WELLS FARGO BANK, N.A.,

individually in its capacity as a Lender

By: /s/ Yann Blindert

Name: Yann Blindert

Title: Assistant Vice President

Signature Page to Amendment No. 2

KEYBANK NATIONAL ASSOCIATION,

individually in its capacity as a Lender

By: /s/ Keven D. Smith

Name: Keven D. Smith

Title: Senior Vice President

Signature Page to Amendment No. 2

COMPASS BANK,

individually in its capacity as a Lender

By: _________________________

Name: _________________________

Title: _________________________

Signature Page to Amendment No. 2

SOUTHWEST SECURITIES, FSB,

individually in its capacity as a Lender

By: _________________________

Name: _________________________

Title: _________________________

Signature Page to Amendment No. 2

UNITED WESTERN BANK,

individually in its capacity as a Lender

By: /s/ Michael Saun

Name: Michael Saun

Title: Senior Vice President

Signature Page to Amendment No. 2

ATTACHMENT A

SCHEDULE 1.1(a)

PRO RATA SHARES

Lender	Commitment	Pro Rata Share

JPMorgan Chase Bank, N.A.	$15,000,000	20.000000%
Union Bank of California, N.A.	$15,000,000	20.000000%
SunTrust Bank	$13,500,000	18.000000%
Wells Fargo Bank, N.A.	$13,125,000	17.500000%
KeyBank National Association	$11,250,000	15.000000%
United Western Bank	$3,375,000	4.500000%
Compass Bank	$1,875,000	2.500000%
Southwest Securities, FSB	$1,875,000	2.500000%
Total	$75,000,000	100.000000%