PNM RESOURCES INC (Form: 8-K, Received: 05/26/2009 16:48:06)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 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) May 26, 2009

(May 19, 2009)

Commission File Number	Name of Registrant, State of Incorporation, Address and Telephone Number	IRS Employer Identification No.

001-32462	PNM Resources, Inc. (A New Mexico Corporation) Alvarado Square Albuquerque, New Mexico 87158 (505) 241-2700	85-0468296

_____________________________________

(Former name or former address, if changed since last report)

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 5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) Compensatory Arrangements of Certain Officers.

On May 19, 2009, the shareholders of PNM Resources, Inc. (the “Company”) approved the Company’s Second Amended and Restated Omnibus Performance Equity Plan (the “PEP”). The terms of the PEP were previously disclosed in the Company’s definitive proxy statement for its 2009 annual meeting of shareholders (the “2009 Proxy Statement”), which was filed with the Securities and Exchange Commission (the “SEC”) on April 8, 2009. In addition, a copy of the PEP was filed as Exhibit 4.1 to the Registration Statement on Form S-8 (File No. 333-159361) that the Company filed with the SEC on May 20, 2009, and is incorporated herein by reference.

When the Company’s shareholders approved the PEP, certain programs and awards that the Company’s Board Governance and Human Resources Committee (the “Compensation Committee”) previously granted under the PEP (subject to shareholder approval of the PEP) became effective. Those programs and awards include the 2009 Officer Incentive Plan (the “OIP”), performance-based, time-vested restricted stock rights awards and performance cash awards based on adjusted cash earnings, performance share awards and performance cash awards tied to special purpose performance criteria, and time-vested restricted stock rights awards, all of which are described below.

Officer Incentive Plan

As noted, the OIP and the award opportunities established thereunder became effective on shareholder approval of the PEP. The OIP and the related award opportunities previously were disclosed in a Current Report on Form 8-K that the Company filed with the SEC on February 20, 2009 and on pages 38 and 39 of the 2009 Proxy Statement. Awards are earned under the OIP based on business area and individual performance against established goals. However, in order to ensure the awards can be funded by the Company’s earnings, no awards will be made unless the Company achieves certain threshold corporate earnings per share targets, adjusted for certain items, to ensure the award payments are based on the underlying growth of the core business (“Incentive EPS”). The Incentive EPS levels are established solely for measuring performance under the OIP and have no effect on, and are not necessarily identical to, any earnings guidance that may be announced by the Company. A copy of the OIP is filed herewith as Exhibit 10.2.

Performance-Based, Time-Vested Restricted Stock Rights and Performance Cash Awards Based on Adjusted Cash Earnings

The Compensation Committee’s previous awards of performance-based, time-vested restricted stock rights and performance cash also became effective on shareholder approval of the PEP. These awards previously were disclosed on page 43 of the 2009 Proxy Statement. The number of restricted stock rights issued pursuant to a performance-based, time-vested restricted stock rights award and the amount payable pursuant to a performance cash award will be determined based upon the Company’s adjusted cash earnings during the one-year performance period beginning on January 1, 2009 and ending on December 31, 2009. The adjusted cash earnings performance element focuses on the Company’s net cash flow earnings from operating activities (as reflected on the Company’s cash flow earnings statement), adjusted to reflect certain items as described in the 2009 Proxy Statement. The adjusted cash earnings levels are established

solely for measuring performance under the performance-based, time-vested restricted stock rights awards and performance cash awards and have no effect on, and are not necessarily identical to, any earnings outlook or guidance that may be announced by the Company. Copies of the Performance Restricted Stock Rights Award Agreement and the Performance Cash Award Agreement are filed herewith as Exhibits 10.4 and 10.5, respectively.

The performance-based, time-vested restricted stock rights awards and the performance cash awards described in the preceding paragraph were made in connection with the Compensation Committee’s earlier decision to modify the Company’s long-term incentive compensation program. The Compensation Committee’s modifications to the long-term incentive compensation program were described in the Compensation Discussion and Analysis section of the 2009 Proxy Statement (see “Long-Term Incentive Compensation” beginning on page 40). Under the Company’s modified long-term incentive compensation program, the Compensation Committee intends to make the following types of awards pursuant to the PEP (percentages indicate relative allocations of each type of award):

·	Stock options – 20%;

·	Performance-based, time-vested restricted stock rights – 40%; and

·	Performance cash awards – 40%.

Special Purpose Awards

On April 27, 2009, performance share awards and additional performance cash awards, both of which are tied to special purpose performance criteria, were approved. These awards were made subject to shareholder approval and became effective on shareholder approval of the PEP. These awards were not made pursuant to the Company’s modified long-term incentive compensation program as described in the preceding paragraph, but rather as one-time special purpose awards.

The number of performance shares issued to a particular named executive officer (“NEO”) of the Company pursuant to the special purpose performance criteria award will be determined based on the Company’s level of attainment of two performance goals during the April 1, 2009 to December 31, 2011 performance period. The two performance goals are (1) the Company’s funds from operations (“FFO”) to debt ratio; and (2) the reduction in the emission levels of (a) nitrous oxide, (b) sulfur dioxide, (c) particulate matter, and (d) mercury at the Company’s San Juan Generating Station to levels that are less than the limits on the emissions of such pollutants set forth in the Consent Decree entered by the United States District Court for the District of New Mexico on May 10, 2005 in the case of Grand Canyon Trust and Sierra Club v. Public Service Company of New Mexico , Case No. CIV 02-552 (the “Environmental Goal”). Each of the two performance goals will determine 50% of the total amount of performance shares, if any, issued pursuant to the award. At the end of the performance period, the Compensation Committee will determine the Company’s FFO to debt ratio for the year ended December 31, 2011 (threshold, target, or maximum), the level of attainment of the Environmental Goal during the performance period (threshold, target, or maximum) and the corresponding level of the NEO’s performance share award for each performance goal (threshold, target, or maximum). The Compensation Committee will submit its determinations to the Board of Directors (or the independent Directors) for approval to the extent the Board’s (or independent Directors’) approval is necessary with respect to any NEO. The performance shares, if any, payable pursuant to the award will be issued on or before March 15, 2012. The maximum award opportunity is three times the threshold grant. The Compensation Committee intends that the performance share awards granted to “covered employees” as defined in

Section 162(m) of the Tax Code and Internal Revenue Service guidance issued thereunder will qualify for the performance based compensation exception to the limitation on deductibility of compensation imposed by Section 162(m) of the Tax Code. A copy of the Performance Share Award Agreement is filed herewith as Exhibit 10.6.

The amount of the performance cash award to which a particular NEO is entitled pursuant to the special purpose performance criteria award also will be determined based on the Company’s level of attainment of the FFO to debt ratio and the Environmental Goal during the April 1, 2009 to December 31, 2011 performance period. At the end of the performance period, the Compensation Committee will determine the Company’s FFO to debt ratio for the year ended December 31, 2011 (threshold, target, or maximum), the level of attainment of the Environmental Goal during the performance period (threshold, target, or maximum) and the corresponding level of the NEO’s performance cash award for each performance goal (threshold, target, or maximum). The Compensation Committee will submit its determinations to the Board of Directors (or independent Directors) for approval to the extent the Board’s (or independent Directors’) approval is necessary with respect to any officer. The performance cash award, if any, payable pursuant to the award will be paid on or before March 15, 2012. The maximum award opportunity is three times the threshold grant. The Compensation Committee intends that the performance cash awards granted to “covered employees” will qualify for the performance based compensation exception to the limitation on deductibility of compensation imposed by Section 162(m) of the Tax Code. A copy of the Performance Cash Award Agreement is filed herewith as Exhibit 10.7.

The FFO to debt ratio and the Environmental Goal used for purposes of the special purpose performance share awards and performance cash awards described in the preceding paragraphs are established solely for measuring performance under the performance share awards and performance cash awards and should not be considered to have any other effect.

Time-Vested Restricted Stock Rights Awards

Two-thirds of the 2009 awards of time-vested restricted stock rights awards previously disclosed on pages 41 and 42 of the 2009 Proxy Statement were granted in February 2009 as discussed in the 2009 Proxy Statement. On May 18, 2009, the Compensation Committee also approved (subject to shareholder approval of the PEP and the approval of the Board) the grant of the remaining one-third of the 2009 awards of time-vested restricted stock rights. The time-vested restricted stock rights awards became effective upon shareholder approval of the PEP and Board approval, both of which occurred on May 19, 2009. A copy of the Restricted Stock Rights Award Agreement is filed herewith as Exhibit 10.8.

The descriptions of the terms and conditions of the programs created and the awards granted pursuant to the PEP contained herein and in the 2009 Proxy Statement are not complete and are qualified in their entirety by reference to the full text of the PEP, the OIP and the related forms of award agreements. The following forms of award agreements relating to awards to be granted by the Compensation Committee under the PEP are filed as exhibits to this Current Report on Form 8-K:

·	Form of Stock Option Award Agreement (for nonqualified stock options granted in 2010 and later) (Exhibit 10.3 filed herewith);

·	Form of Performance Restricted Stock Rights Award Agreement (for performance-based, time-vested restricted stock rights awards based on adjusted cash earnings) (Exhibit 10.4 filed herewith);

·	Form of Performance Cash Award Agreement (for performance cash awards based on adjusted cash earnings) (Exhibit 10.5 filed herewith);

·	Form of Performance Share Award Agreement (for performance share awards based on special purpose performance criteria) (Exhibit 10.6 filed herewith);

·	Form of Performance Cash Award Agreement (for performance cash awards based on special purpose performance criteria) (Exhibit 10.7 filed herewith); and

·	Form of Restricted Stock Rights Award Agreement (for time-vested restricted stock rights awards) (Exhibit 10.8 filed herewith).

Item 9.01.

Financial Statements and Exhibits.

(d) Exhibits:

Exhibit Number	Description
10.1	PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-8 (File No. 333-159361) that the Company filed on May 20, 2009)
10.2	2009 Officer Incentive Plan
10.3	Form of Stock Option Award Agreement for nonqualified stock options granted in 2010 and later under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.4	Form of Performance Restricted Stock Rights Award Agreement for performance-based, time-vested restricted stock rights awards based on adjusted cash earnings granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.5	Form of Performance Cash Award Agreement for performance cash awards based on adjusted cash earnings granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.6	Form of Performance Share Award Agreement for performance share awards based on special purpose performance criteria granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.7	Form of Performance Cash Award Agreement for performance cash awards based on special purpose performance criteria granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.8	Form of Restricted Stock Rights Award Agreement for time-vested restricted stock rights awards granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

PNM RESOURCES, INC.

(Registrant)

Date: May 26, 2009 By: /s/ Thomas G. Sategna

Thomas G. Sategna

Vice President and Corporate Controller

(Officer duly authorized to sign this report)

EXHIBIT INDEX

Exhibit Number	Description
10.1	PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-8 (File No. 333-159361) that the Company filed on May 20, 2009)
10.2	2009 Officer Incentive Plan
10.3	Form of Stock Option Award Agreement for nonqualified stock options granted in 2010 and later under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.4	Form of Performance Restricted Stock Rights Award Agreement for performance-based, time-vested restricted stock rights awards based on adjusted cash earnings granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.5	Form of Performance Cash Award Agreement for performance cash awards based on adjusted cash earnings granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.6	Form of Performance Share Award Agreement for performance share awards based on special purpose performance criteria granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.7	Form of Performance Cash Award Agreement for performance cash awards based on special purpose performance criteria granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan
10.8	Form of Restricted Stock Rights Award Agreement for time-vested restricted stock rights awards granted under the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan

Exhibit 10.2

PNM RESOURCES, INC.

2009 OFFICER INCENTIVE PLAN

INTRODUCTION

PNM Resources, Inc. (the “Company”) has adopted the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “PEP”), which currently is subject to approval by the Company’s shareholders and becomes effective upon shareholder approval. The Company also has adopted this 2009 Officer Incentive Plan (the “Plan”) for the purpose of providing annual cash-based incentive awards (each an “Award”) to eligible Officers (as defined below). The Awards payable to Officers under the Plan are intended to qualify as Performance Cash Awards granted pursuant to Section 9.4 of the PEP and, in the case of Officers who are Covered Employees, as Performance-Based Performance Cash Awards granted pursuant to Section 12 of the PEP.

Capitalized terms used in the Plan and not otherwise defined herein shall have the meanings given to them under the terms of the PEP.

ELIGIBILITY

All Officers of the Company and its Affiliates are eligible to participate in the Plan with the exception of the First Choice Power officers, who will participate in the First Choice Power, L.P. Incentive Plan, and the Optim Energy, LLC officers, who will participate in Optim Energy’s programs. For purposes of the Plan, the term “Officer” means any employee of the Company or any Affiliate (other than First Choice Power or Optim Energy) who has the title of Chief Executive Officer, President, Executive Vice President, Senior Vice President or Vice President and who is in salary grade H18 or higher.

PLAN OBJECTIVES

The Plan is designed to motivate and reward Officers for benefiting our customers and shareholders by achieving and exceeding the Performance Goals (as defined below) established for such Officers.

PERFORMANCE PERIOD

The period over which the Officer’s performance will be measured for purposes of determining whether Awards are payable under the Plan began on January 1, 2009 and ends on December 31, 2009 (the “Performance Period”). The Board Governance and Human Resources Committee (the “Committee”) of the Company’s Board of Directors (the “Board”), in its sole discretion, reserves the right to adjust, amend or suspend the Plan during the Performance Period.

AWARD DETERMINATION

In order for Awards to be payable under the Plan, the performance goals described below (collectively, the “Performance Goals”) must be satisfied.

Exhibit 10.2

Business Area Earnings Per Share

PNM Resources, Inc. will be treated as one “Business Area” and its Utility subsidiaries (Public Service Company of New Mexico and Texas-New Mexico Power Company), collectively, will be treated as a separate “Business Area.” A Business Area must achieve the applicable Earnings Per Share (“EPS”) levels set forth in the table below in order for Awards to be payable pursuant to the Plan to Officers within such Business Area.

	PNMR EPS	Utility EPS
No Award	Less than or equal to $0.40	Less than or equal to $0.53
Threshold	Greater than or equal to $0.41 and less than or equal to $0.45	Greater than or equal to $0.54 and less than or equal to $0.59
Target	Greater than or equal to $0.46 and less than or equal to $0.58	Greater than or equal to $0.60 and less than or equal to $0.73
Maximum	Greater than or equal to $0.59	Greater than or equal to $0.74

If a Business Area does not achieve the Threshold EPS level set forth above, no Awards are payable under the Plan to Officers within that Business Area. In addition, no Awards are payable to Officers of either Business Area if the PNM Resources EPS is less than $0.41. Subject to the preceding sentence, if a Business Area achieves the Threshold, Target or Maximum level of EPS, the aggregate potential Awards payable to the Officers of that Business Area at that level of performance (e.g., the aggregate Awards payable at Target for those Officers), as determined pursuant to the table set out below, will make up the initial potential “Award Pool” for that Business Area.

The Award Pool for a Business Area will be increased if the attained EPS level exceeds by at least $0.01 the minimum EPS number for the Target Award level and is less than the minimum EPS number for the Maximum Award level. For example, if the PNM Resources EPS is at least $0.47 but is less than $0.59, the Award Pool for the PNM Resources Business Area will be increased. For each $0.01 of additional EPS, the Award Pool will be increased by up to the Plan’s share of 25% of the incremental earnings (i.e., the additional EPS multiplied by the average number of common shares of PNM Resources, Inc, common stock used to calculate diluted EPS as reported in Company’s 10-K multiplied by 25%). The Plan’s share of 25% of the incremental earnings will be determined by multiplying 25% of the incremental earnings by a fraction, the numerator of which is the Award Pool for that Business Area and the denominator of which is the sum of the Award Pool for both Business Areas under this Plan and the total award pool under Company’s incentive compensation plan for non-Officer employees. The Committee, in the exercise of its discretion, may choose to increase the Award Pool by an amount less than the Business Area’s share of 25% of the incremental earnings.

For purposes of the Plan, a Business Area’s EPS will be the net earnings for that Business Area, excluding non-recurring items that do not factor into ongoing earnings, divided by the average number of common shares of PNM Resources, Inc, common stock used to calculate diluted EPS as reported in Company’s 10-K. The Committee’s determination of the EPS of a particular Business Unit shall be binding and conclusive.

For purposes of the Plan, the Chief Executive Officer, the Executive Vice President, the Chief Operating Officer, the Senior Vice Presidents and the shared services Vice Presidents are

Exhibit 10.2

assigned to the PNM Resources Business Area. The utility Vice Presidents are assigned to the Utility Business Area.

Each Business Area is broken down into separate “Business Units.” The Business Units are identified on Attachment A. The Award Pool for each Business Area will be broken into Business Unit Award Pools. The Award Pool for each of the Business Units of a Business Area will be determined by multiplying the Business Area Award Pool by a fraction. The numerator of the fraction is the total potential Awards payable at the relevant EPS performance level (Threshold, Target or Maximum) to all of the Officers assigned to that Business Unit and the denominator of which is the total potential Awards payable at the relevant performance level to all of the Officers assigned to that Business Area.

Business Unit Award Pools and Scorecard

Performance measures have been established and weighted for each Business Unit in the two Business Areas. These performance measures are described on Attachment A. The Committee will use a Business Unit Scorecard to measure whether a Business Unit met its performance measures at the Threshold, Target or Maximum levels. The level of performance of the relevant Business Unit will be applied to further adjust the Award Pool for that Business Unit. The adjusted Award Pool will equal the lesser of the Award Pool prior to the adjustment or the aggregate potential Awards payable to all of the Officers of that Business Unit at the level of performance (Threshold, Target or Maximum), as described in the table set out below, attained by the Business Unit.

Officer Award Opportunities (as a percentage of base salary )

The amount of the potential Award payable to any Officer based upon his or her Business Unit’s level of achievement of its Performance Goals, expressed as a percentage of the Officer’s base salary determined as of January 1, 2009, is as follows:

	Threshold	Target	Maximum
Chairman and CEO	24.0%	60.0%	120.0%

President and COO	19.0%	48.0%	96.0%
EVP, Chief Financial Officer	19.0%	48.0%	96.0%

Senior Vice-Presidents	14.0%	36.0%	72.0%

VP, Corporate Controller VP, Treasurer VP, Generation VP, CIO VP, People Services VP, Marketing & Cust. Service VP, Regulatory	10.0%	24.0%	48.0%
All Other Vice-Presidents	7.0%	18.0%	36.0%

The adjusted Business Unit Award Pool will be allocated among the Officers in that Business Unit based upon the amount potentially payable to that Officer, as determined in accordance with the table set out above, for the level of performance (Threshold, Target or Maximum) attained by the relevant Business Unit, as compared to the similar amounts payable to all

Exhibit 10.2

Officers of that Business Unit at the relevant performance level. In no event will the amount payable to an Officer exceed the indicated percentage of the Officer’s base salary, as in effect on January 1, 2009, as determined in accordance with the above table, for the attained level of performance.

Individual Goals

On or before March 31, 2009, the Committee will establish in writing and provide to each Officer the individual leadership effectiveness goals (“Individual Goals”) by which the Committee will measure the Officer’s individual performance during the Performance Period. The Committee, in its discretion, will establish the Individual Goals for the Chief Executive Officer. The Committee will establish the Individual Goals for all other Officers based on management’s recommendations. The Committee may reduce (but not increase) each Officer’s Award, as calculated above, by up to 33.33% based on the Committee’s determination with respect to whether the Officer met the Officer’s Individual Goals during the Performance Period. The Committee’s assessment of an Officer’s performance is final and conclusive.

FFO/Debt Modifier

The amount of the Award available to the Officers, as determined above, is subject to a positive or negative adjustment of up to 10% based on the ratio of the Company’s funds from operations to debt (the “FFO/Debt Modifier”) as set forth in the table below:

Level	FFO/Debt Result	Award Modifier
Threshold	11.0	(10%)
Target	11.5	0
Maximum	12.5	10%

The level of the Award Modifier will be interpolated for each incremental 0.1 of FFO/Debt result.

AWARD APPROVAL AND PAYOUT TIMING

In January 2010, the Committee will determine and certify the level of Awards, if any, payable for the Performance Period in the manner described above. The Board then will approve the CEO’s Award and the Committee will have final approval authority for all other Awards. To the extent Awards are payable under the Plan, the Company will make such payment on or before March 15, 2010 in a single lump sum cash payment.

The total of all Awards payable to the Officers of a Business Area or Unit will not exceed the adjusted Award Pool for that Business Area or Unit.

PROVISIONS FOR A CHANGE IN CONTROL

If a Change in Control occurs during the Performance Period and the Officer still is employed by the Company or an Affiliate at the end of the Performance Period, the Officer may be entitled to receive an Award for such Performance Period. If the Plan is modified after the occurrence of a Change in Control in a manner that has the effect of reducing the amounts otherwise payable under the Plan, the Officer shall receive, at a minimum, an Award equal to 50% of the Maximum Award available under this Plan for the Performance Period. Such Award will be payable in a single lump sum cash payment on or before March 15, 2010.

Exhibit 10.2

PRO-RATA AWARDS FOR PARTIAL SERVICE PERIODS

In the event an Officer who is eligible for an Award under the Plan does not participate in the Plan for the entire Performance Period or participates in the Plan at varying levels during the Performance Period, the Officer may be entitled to a pro rata portion of the Award, if any, payable at the end of the Performance Period based on the level of achievement of the Performance Goals applicable to the Award. The payment to which the Officer is entitled for the pro rata portion of the Award shall be based on the number of full months that the Officer was actively employed at each eligibility level during the Performance Period compared to the number of full months included in the Performance Period. Any pro-rata Awards to which an Officer becomes entitled pursuant to this paragraph will be paid to the Officer in a single lump sum cash payment on or before March 15, 2010. (Note: Any month in which an Officer is actively on the payroll for at least one day will count as a full month.)

Pro-rata Awards will be payable only to the following Officers or Employees:

-	Officers who are newly hired during the Plan Year and are employed by the Company or an Affiliate on the day on which Awards are distributed for the Performance Period.

-	Employees or Officers who are promoted, transferred or demoted during the Performance Period and are employed by the Company or an Affiliate on the day on which Awards are distributed for the Performance Period.

-	Officers who are on leave of absence for any full months during the Performance Period and are employed by the Company or an Affiliate on the day on which Awards are distributed for the Performance Period.

Officers who terminate employment with the Company or an Affiliate during the Performance Period due to Impaction (as defined in the PNM Resources, Inc. Non-Union Severance Pay Plan), retirement on or after the Officer’s Normal Retirement Date (as defined in the PNM Resources, Inc. Retirement Savings Plan), Change in Control (as defined in the PNM Resources, Inc. Officer Retention Plan) or Disability (as defined in the PNM Resources Executive Savings Plan II).

-	Officers who die during the Performance Period, in which case the Award will be paid to the spouse of a married Officer or the estate of an unmarried Officer.

FORFEITURE OF AWARDS

An Officer who terminates employment with the Company or an Affiliate on or before the date on which Awards are distributed for the Performance Period for any reason other than death, Impaction, Retirement, Change in Control or Disability will not be eligible for payment of an Award. (Any Officer who elects voluntary separation or Retirement in lieu of termination for performance or misconduct will not be eligible for payment of an Award.)

ETHICS

The purpose of the Plan is to fairly reward performance achievement. Any Officer who manipulates or attempts to manipulate the Plan for personal gain at the expense of customers, other employees or Company or Affiliate objectives will be subject to appropriate disciplinary action, up to and including termination of employment, and will forfeit any bonus under the Plan.

Exhibit 10.2

NONTRANSFERABLE

No award may be assigned or transferred by an Officer other than by will or the laws of descent and distribution.

WITHHOLDING

The Company or any Affiliate has the authority and the right to deduct or withhold, or to require an Officer to remit to the Company, an amount sufficient to satisfy Federal, state, and local and foreign taxes (including the Officer’s FICA obligation) required by law to be withheld with respect to any taxable event arising as a result of this Plan. Any potential payment to an Officer under the terms of this Plan also is subject to withholdings and deductions by the Company or any Affiliate, and the Officer hereby authorizes the Company or any Affiliate to apply such withholdings and deductions to liquidate and reduce any outstanding debt or unpaid sums owed by the Officer to the Company or any Affiliate or to the successor of either of them.

NO RIGHTS OF OWNERSHIP

While the Plan is intended to provide Officers with the opportunity to share in the success of the Company and its Affiliates, the Plan is merely a bonus plan and does not give any Officer any of the rights of ownership of the Company or any Affiliate or provide any security interest in any assets of the Company or any Affiliate.

CONTINUATION OF EMPLOYMENT

This Plan shall not be construed to confer upon any Officer any right to continue in the employment of the Company or any Affiliate and shall not limit the right of the Company or any Affiliate, in its sole discretion, to terminate the employment of any Officer at any time.

Approved by:

/s/ Alice A. Cobb

Alice A. Cobb, Senior Vice President

and Chief Administrative Officer

Date: March 30, 2009

Exhibit 10.3

STOCK OPTION AWARD AGREEMENT

PNM RESOURCES, INC.

SECOND AMENDED AND RESTATED

OMNIBUS PERFORMANCE EQUITY PLAN

PNM Resources, Inc., a New Mexico corporation (“PNM” or the “Company”), hereby awards to «First» «Last» (the “Optionee”), an employee of the Company and a Participant in the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “Plan”), as it may be amended, a non-qualified stock option (“Option” or “Options”) to purchase up to, but not to exceed in the aggregate «Total_Stock_Options» shares of common stock of the Company (“Stock”), at an Exercise Price of $xx.xx per share, subject to the terms and conditions set forth in this Stock Option Award Agreement (the “Agreement”). The grant is given effective as of the ____ day of ________, 20__ (the “Grant Date”).

Capitalized terms used in this Agreement and not otherwise defined herein shall have the meanings given to such terms in the Plan.

1. Grant . This Option is granted pursuant to the Plan, the terms of which are hereby incorporated by reference.

2. Vesting .

(a) Except as set forth herein below, these Options shall vest in the following manner: (i) on the first anniversary of the Grant Date, 33%; (ii) on the second anniversary of the Grant Date, an additional 34%; and (iii) on the third anniversary of the Grant Date, the final 33%.

(b) Upon the Optionee’s Termination of Employment with the Company due to death, Disability, Retirement, Impaction or a Change in Control, all nonvested Options shall become 100% vested as described in the applicable provisions of the Plan.

(c) Upon the Optionee’s involuntary or voluntary Termination of Employment with the Company for reasons other than those set forth in Subparagraph (b) above, the Option, if not previously vested, shall be canceled and forfeited.

(d) Upon the Optionee’s Termination of Employment with the Company for Cause, all Options (vested and nonvested) shall be terminated and forfeited immediately.

3. Exercise of Options .

(a) Timing of Exercise . Generally, the vested Options shall be exercisable at any time following the vesting thereof, on or before the earlier of (i) three (3) months following the Optionee’s voluntary or involuntary Termination of Employment for reasons other than Impaction or Cause; (ii) three (3) years following the Optionee’s Termination of Employment due to death, Disability, Retirement, Impaction or Change In Control of the Company; or (iii) the tenth (10 th ) anniversary date of the Grant Date of the Options. The time period during which Optionee may exercise any Option will not be extended for any reason. The Company does not represent or guarantee that the Options granted hereunder will actually be exercisable throughout

the exercise period. Factors that could affect the exercisability of the Options or the Optionee’s desire to exercise the Options include, but are not limited to, the price of Company Stock remaining below the exercise price for any Option, black-out periods that preclude the sale of Stock acquired through the exercise of any Option or that may preclude the exercise of any Option, or lapse of the exercise period.

Optionee is responsible for ascertaining the times and conditions applicable to the exercise of each Grant of Options awarded under the Plan.

(b) Time and Method of Payment . The Options shall be exercised by the Optionee giving written notice to the Company of his or her intent to exercise the Options, along with the tendering of cash in full payment of the Exercise Price of the Options being exercised, times the number of such Options being exercised. Alternatively, in lieu of cash, the Exercise Price may be paid, in full or in part by the Optionee, by delivery to the Company (through actual tender or by attestation), of Stock of the Company owned by the Optionee for more than six months. The amount credited against the Exercise Price for Stock being assigned and delivered to the Company shall equal the Fair Market Value of the Stock on the date of transfer times the number of shares being assigned and delivered. In addition, the Exercise Price for any Option may be paid through (i) a broker-assisted “cashless exercise” arrangement by the Optionee’s delivery of written notice to the Company of his or her intent to exercise the Options together with irrevocable instructions to the broker to promptly deliver to the Company the amount of the sale or loan proceeds that is equal to the Exercise Price; or (ii) any other method permitted by the Committee, in its discretion. For Optionees subject to Section 16 of the Exchange Act and key employees as specified in the Insider Trading Policy, pre-clearance for sales of stock (including a broker-assisted “cashless exercise”) shall be obtained from the Senior Vice President and General Counsel at PNM Resources, Inc., Alvarado Square, Albuquerque, New Mexico 87158, or his/her successor.

(c) Exercise Following Optionee’s Death . If the Optionee dies, whether or not the Optionee is an employee of the Company at the date of such death, without having fully exercised his or her vested Options, the personal representative or the person receiving such Options from the Optionee or his or her estate shall have the right to exercise the Options pursuant to the timing and methods set forth in Subparagraphs (a) and (b) above.

(d) Delivery of Shares . Within an administratively reasonable period of time after the exercise of an Option and the payment of the full Exercise Price, and after satisfaction of all applicable withholding requirements, the Optionee shall receive a Stock certificate evidencing his or her ownership of such Stock. The Optionee shall have none of the rights of a shareholder with respect to Options until the date a Stock certificate is issued in the Optionee’s name. No adjustment will be made for dividends or other rights for which the record date is prior to the date such Stock certificate is dated.

(e) Holding Period . The shares of Stock obtained upon the exercise of any Option granted hereunder may not, if necessary to meet Rule 16b-3 requirements, be sold by an Optionee subject to Section 16 of the Exchange Act until six (6) months after the delivery to the Participant of the Stock Option Award Agreement.

4. Adjustments . Neither the existence of the Plan nor this Option shall affect, in any way, the right or power of the Company to make or authorize: any or all adjustments, recapitalizations, reorganizations, or other changes in the Company’s capital structure or its business; or any merger or consolidation of the Company; or any corporate act or proceeding, whether of a similar character or otherwise; all of which, and the resulting adjustments in, or impact on, the Option are more fully described in Section 5.3 of the Plan.

5. Withholding and Deductions . The Company shall have the right to deduct from any payments made by the Company to the Optionee, or to require that the Optionee remit to the Company, an amount sufficient to satisfy any federal, state or local taxes of any kind as are required by law to be withheld with respect to the exercise of the Options granted hereunder. The Company also shall have the right to take such other actions as may be necessary in the opinion of the Company to satisfy the tax withholding and payment obligations related to the exercise of the Options granted hereunder. The Company may, in its sole discretion, permit the Optionee to elect to satisfy the minimum statutory tax withholding obligation which may arise in connection with the exercise of Options by requesting that the Company withhold shares of Stock having a Fair Market Value of the Stock equal to the amount of the minimum statutory tax withholding. Any such election shall be subject to the provisions of applicable law and to any conditions the Committee may determine to be necessary in order to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act. Any shares of Stock deliverable to the Optionee under the terms of this Agreement also are subject to offset by the Company, and the Optionee hereby authorizes such offset, to liquidate and reduce any outstanding debt or unpaid sums owed by the Optionee to the Company or its successor.

6. Compliance with Exchange Act . With respect to Optionees subject to Section 16 of the Exchange Act, Options granted or exercised pursuant to this Award are intended to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act.

7. Dividend Equivalents . The Optionee will not be entitled to receive a dividend equivalent for any of the shares of Stock subject to the Options granted hereunder.

8. Non-Assignability . Options shall not be transferable other than by will or by the laws of descent and distribution, and during Optionee’s lifetime shall be exercisable only by the Optionee. The Options are otherwise non-assignable. (See Section 14 of the Plan).

9. Optionee Representation . As a condition to the exercise of any Option, the Company may require a representation from the person exercising the Option that the Stock is being acquired only for investment purposes and without any present intention to sell or distribute such shares.

10. Employment Agreement . Notwithstanding anything to the contrary herein contained in this Agreement, (a) neither the Plan nor this Agreement is intended to create an express or implied contract of employment for a specified term between the Optionee and the Company and (b) unless otherwise expressed or provided, in writing, by an authorized officer, the employment relationship between the Optionee and the Company shall be defined as “employment at will” wherein either party, without prior notice, may terminate the relationship with or without cause.

11. Regulatory Approvals and Listing . The Company shall not be required to issue any certificate for shares of Stock upon the exercise of an Option granted under the Agreement prior to satisfying any regulatory or registration approval, qualification or ruling from the Securities and Exchange Commission, the Internal Revenue Service or any other governmental agency which the Committee, in its sole discretion, shall determine to be necessary or advisable. (See Section 20.1 of the Plan).

12. Nonstatutory Stock Option . The Options granted hereunder are nonstatutory (non-qualified) stock options, and are not “incentive stock options” pursuant to the Code.

13. Administration . This Agreement shall at all times be subject to the terms and conditions of the Plan and the Plan shall in all respects be administered by the Committee in accordance with the terms of and as provided in the Plan. The Committee shall have the sole and complete discretion with respect to the interpretation of this Agreement and the Plan, and all matters reserved to it by the Plan. The decisions of the majority of the Committee with respect thereto and to this Agreement shall be final and binding upon Optionee and the Company. In the event of any conflict between the terms and conditions of this Agreement and the Plan, the provisions of the Plan shall control.

14. Waiver and Modification. The provisions of this Agreement may not be waived or modified unless such waiver or modification is in writing signed by the Company.

15. Validity and Construction . The validity and construction of this Option shall be governed by the laws of the state of New Mexico.

MANY OF THE PROVISIONS OF THIS AWARD AGREEMENT ARE SUMMARIES OF SIMILAR PERTINENT PROVISIONS OF THE PLAN. TO THE EXTENT THIS AGREEMENT IS SILENT ON AN ISSUE OR THERE IS A CONFLICT BETWEEN THE PLAN AND THIS AGREEMENT, THE PLAN PROVISIONS SHALL CONTROL.

IN WITNESS WHEREOF, the Company has caused this Stock Option Award Agreement to be executed, effective as of ____________, 20__, by its duly authorized representative.

PNM RESOURCES, INC.

By ________________________________

Alice A. Cobb

Senior Vice President and

Chief Administrative Officer

Exhibit 10.4

PERFORMANCE

RESTRICTED STOCK RIGHTS AWARD AGREEMENT

PNM RESOURCES, INC. SECOND AMENDED AND RESTATED

OMNIBUS PERFORMANCE EQUITY PLAN

PNM Resources, Inc., a New Mexico corporation, (“PNMR” or the “Company”) hereby awards to «First» «Last» , (the “Grantee”), a Participant in the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “Plan”), as it may be amended, a Performance Restricted Stock Rights Award (the “Award”) for the number of shares of common stock of Company (“Stock”) noted below. The grant is made effective as of the 9th day of March, 2009 (the “Grant Date”).

Capitalized terms used in this Performance Restricted Stock Rights Award Agreement (the “Agreement”) and not otherwise defined herein shall have the meanings given to such terms in the Plan.

1. Grant . Company hereby awards Grantee an opportunity to earn Restricted Stock Rights at the Threshold, Target or Maximum Award level listed in Section 5, based upon Company’s performance over the Performance Period (as defined in Section 4), in accordance with and subject to the terms and conditions set forth in this Agreement. In no event will the Award exceed the Maximum Award level indicated in Section 5. If Grantee is a Covered Employee, the Award is intended to be a Performance-Based Award granted pursuant to Section 12 of the Plan.

2. Award Subject to Plan . This Award is granted pursuant to the Plan, the terms of which are hereby incorporated by reference.

3. Shareholder Approval Required . Grantee understands and agrees that Company has adopted the amended and restated Plan subject to shareholder approval. If the shareholders of Company do not approve the Plan at the annual shareholders meeting on May 19, 2009 or any extensions thereof, the Award and this Agreement shall automatically be withdrawn and cancelled and no amounts will be payable to Grantee hereunder.

4. Performance Period . The Performance Period for this Award begins on January 1, 2009 and ends on December 31, 2009.

5. Performance Goals; Number of Restricted Stock Rights Earned . Grantee will earn Restricted Stock Rights based upon the level of Company’s Adjusted Cash Earnings during the Performance Period as set forth below:

If Company’s Adjusted Cash Earnings over the Performance Period are:	The number of Restricted Stock Rights awarded to Grantee will be:
At least $250 MM (but not $260 MM)	__________ (the Threshold Award), adjusted as described below.
At least $260 MM (but not $275 MM)	__________ (the Target Award), adjusted as described below.
$275 MM or more	__________ (the Maximum Award)

If Company’s Adjusted Cash Earnings for the Performance Period are less than $250,000,000, no Restricted Stock Rights will be due pursuant to the Agreement. If Company’s Adjusted Cash Earnings for the Performance Period exceed $250,000,000 but are less than $260,000,000, the number of Restricted Stock Rights to which Grantee is entitled will be interpolated between the Threshold and Target Award levels. If Company’s Adjusted Cash Earnings for the Performance Period exceed $260,000,000 but are less than $275,000,000, the number of Restricted Stock Rights to which Grantee is entitled also will be interpolated between the Target and Maximum Award levels.

6. Adjusted Cash Earnings . Company’s “Adjusted Cash Earnings” for the Performance Period is the amount of Company’s net cash flow from operating activities (as reflected on Company’s cash flow statement) adjusted by the following: (a) adding amounts received by Company as principal payments on the Palo Verde lessor notes; (b) adding amounts received by Company as Palo Verde 3 toll revenue; (c) adding amounts received by Company attributable to the Optim Energy, LLC, cash earnings; (d) subtracting the changes in Company’s working capital; and (e) subtracting the taxes paid by Company on the Gas Asset Transaction. For purposes of this Agreement, the term “Gas Asset Transaction” means the sale of various assets of the Gas Division by Public Service Company of New Mexico pursuant to the Asset Purchase Agreement by and among Public Service Company of New Mexico, Continental Energy Systems LLC and New Mexico Gas Company, Inc. dated January 12, 2008.

7. Determination of Adjusted Cash Earnings and Restricted Stock Rights Award . The Committee will determine the Adjusted Cash Earnings for the Performance Period and Grantee’s corresponding Restricted Stock Rights Award, if any, on or before February 28, 2010. The Committee then will submit its determinations with respect to the Adjusted Cash Earnings and the number of Restricted Stock Rights to which Grantee is entitled to the Board of Directors for review and approval. The date on which the Board of Directors approves the number of Restricted Stock Rights is referred to below as the “Determination Date.” The Restricted Stock Rights to which Grantee is entitled pursuant to this Section shall vest and become payable at the times described in Sections 8 and 9.

8. Vesting .

(a) Except as set forth below, the Restricted Stock Rights to which Grantee is entitled shall vest in the following manner: (i) 33% of the Restricted Stock Rights will vest on the first anniversary of the Determination Date, (ii) an additional 34% of the Restricted Stock Rights will vest on the second anniversary of the Determination Date, and (iii) the final 33% of the Restricted Stock Rights will vest on the third anniversary of the Determination Date.

(b) Upon Grantee’s Separation from Service due to death, Disability, Retirement, Impaction or Change in Control prior to the end of the Performance Period, Grantee shall vest in a pro rata portion of the Restricted Stock Rights to which Grantee is entitled at the end of the Performance Period as described in Subsection 13.1(a)(iii)(3) of the Plan. The number of Restricted Stock Rights to which Grantee is entitled hereunder shall be determined at the conclusion of the Performance Period based upon actual performance during the Performance Period.

(c) Upon Grantee’s Separation from Service due to death, Disability, Retirement, Impaction or Change in Control after the conclusion of the Performance Period,

nonvested Restricted Stock Rights shall become 100% vested in accordance with Subsection 13.1(a)(iii)(3) of the Plan.

(d) Upon Grantee’s involuntary or voluntary Separation from Service for any reason other than those set forth in Subparagraphs (b) and (c) above, the Restricted Stock Rights, if not previously vested, shall be canceled and forfeited immediately.

(e) Upon Grantee’s Separation from Service for Cause, all nonvested Restricted Stock Rights shall be canceled and forfeited immediately.

9. Form and Timing of Delivery of Stock .

(a) If any Restricted Stock Rights granted hereunder vest as described in Section 8(a), Grantee will receive the Stock payable with respect to such vested Restricted Stock Rights within ninety (90) days following the dates on which the Restricted Stock Rights vest.

(b) If any Restricted Stock Rights granted hereunder vest as described in Section 8(b), Grantee will receive the Stock within ninety (90) days following the end of the Performance Period.

(c) Except as otherwise provided in Section 9(d), if any Restricted Stock Rights granted hereunder vest as described in Section 8(c), Grantee will receive the Stock payable with respect to such Restricted Stock Rights within ninety (90) days following the date of Grantee’s Separation from Service.

(d) The Restricted Stock Rights granted hereunder are subject to the requirements of Section 409A of the Code. Accordingly, the restrictions described in Section 20.4 of the Plan apply to the Restricted Stock Rights. In addition, if Grantee is a Specified Employee at the time of Grantee’s Separation from Service, the six (6) month delay in payments to a Specified Employee upon a Separation from Service (described in Section 20.3 of the Plan) applies.

10. Adjustments . Neither the existence of the Plan nor the Award shall affect, in any way, the right or power of Company to make or authorize: any or all adjustments, recapitalizations, reorganizations, or other changes in Company’s capital structure or its business; or any merger or consolidation of Company; or any corporate act or proceeding, whether of a similar character or otherwise; all of which, and the resulting adjustments in, or impact on, the Award are more fully described in Section 5.3 of the Plan.

11. Withholding and Deductions . Company shall have the right to require that Grantee remit to Company an amount sufficient to satisfy any federal, state or local taxes of any kind as are required by law to be withheld with respect to the delivery of shares of Stock as payment for the Restricted Stock Rights granted hereunder. Company also shall have the right to take such other actions as may be necessary in the opinion of Company to satisfy all obligations for withholding and payment of such taxes. Company may, in its sole discretion, permit Grantee to elect to satisfy the minimum statutory tax withholding obligation which may arise in connection with the Restricted Stock Rights by requesting that Company withhold shares of Stock having a Fair Market Value on the date of withholding equal to the amount of the minimum statutory tax withholding. Any such election shall be subject to the provisions of applicable law and to any conditions the Committee may determine to be necessary in order to

comply with all applicable withholding requirements and the applicable conditions of Rule 16b-3 or its successors under the Exchange Act.

12. Dividend Equivalents . Grantee will not be entitled to receive a dividend equivalent for any of the Restricted Stock Rights granted hereunder.

13. Compliance with Exchange Act . If Grantee is subject to Section 16 of the Exchange Act, Restricted Stock Rights granted pursuant to this Award are intended to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act.

14. Non-Assignability . The Award and Grantee’s rights under this Agreement shall not be transferable other than by will or by the laws of descent and distribution. The Restricted Stock Rights are otherwise non-assignable. (See Section 14 of the Plan). The terms hereof shall be binding on the executors, administrators, heirs and successors of Grantee.

15. Voting Rights . During the Restricted Period, Grantee will have no voting rights with respect to nonvested Restricted Stock Rights.

16. Grantee Representation . As a condition to the receipt of any shares of Stock hereunder, Company may require a representation from Grantee that the Stock is being acquired only for investment purposes and without any present intention to sell or distribute such shares.

17. Employment Agreement . Notwithstanding anything to the contrary contained in this Agreement, (a) neither the Plan nor this Agreement is intended to create an express or implied contract of employment for a specified term between Grantee and Company and (b) unless otherwise expressed or provided, in writing, by an authorized officer, the employment relationship between Grantee and Company shall be defined as “employment at will” wherein either party, without prior notice, may terminate the relationship with or without cause.

18. Regulatory Approvals and Listing . Company shall not be required to issue any certificate for shares of Stock upon the vesting of Restricted Stock Rights granted under this Agreement prior to satisfying any regulatory approval, registration, qualification or other requirements of the Securities and Exchange Commission, the Internal Revenue Service or any other governmental agency which the Committee, in its sole discretion, shall determine to be necessary or advisable. (See Section 20.1 of the Plan).

19. Administration . This Agreement shall at all times be subject to the terms and conditions of the Plan and the Plan shall in all respects be administered by the Committee in accordance with the terms of and as provided in the Plan. The Committee shall have the sole and complete discretion with respect to the interpretation of this Agreement and the Plan, and all matters reserved to it by the Plan. The decisions of the majority of the Committee with respect thereto and to this Agreement shall be final and binding upon Grantee and Company. In the event of any conflict between the terms and conditions of this Agreement and the Plan, the provisions of the Plan shall control.

20. Waiver and Modification . The provisions of this Agreement may not be waived or modified unless such waiver or modification is in writing signed by Company.

21. Validity and Construction . The validity and construction of this Award shall be governed by the laws of the State of New Mexico.

IN WITNESS WHEREOF, Company has caused this Performance Restricted Stock Rights Award Agreement to be executed on March __, 2009, by a duly authorized representative.

PNM RESOURCES, INC.

Alice A. Cobb

Senior Vice President and

Chief Administrative Officer

Exhibit 10.5

PERFORMANCE CASH AWARD AGREEMENT

PNM RESOURCES, INC. SECOND AMENDED AND RESTATED

OMNIBUS PERFORMANCE EQUITY PLAN

PNM Resources, Inc., a New Mexico corporation, (“PNMR” or the “Company”) hereby awards to «First_Name» «Last_Name» , (the “Participant”) a Participant in the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “Plan”), as it may be amended, a Performance Cash Award (the “Award”) effective as of the 9th day of March, 2009.

Capitalized terms used in this Performance Cash Award Agreement (the “Agreement”) and not otherwise defined herein shall have the meanings given to such terms in the Plan.

1. Grant . Company hereby awards to Participant the opportunity to earn a cash payment in an amount equal to the Threshold, Target or Maximum Award level listed in Section 5, based upon Company’s performance over the Performance Period (defined in Section 4), in accordance with and subject to the terms and conditions set forth in this Agreement. In no event will the Award exceed the Maximum Award level indicated in Section 5. If Participant is a Covered Employee, the Award is intended to be a Performance-Based Award granted pursuant to Section 12 of the Plan.

2. Award Subject to Plan . This Award is granted pursuant to the Plan, the terms of which are hereby incorporated by reference.

3. Shareholder Approval Required . Participant understands and agrees that Company has adopted the amended and restated Plan subject to shareholder approval. If the shareholders of Company do not approve the Plan at the annual shareholders meeting on May 19, 2009 or any extensions thereof, the Award and this Agreement shall automatically be withdrawn and cancelled and no amounts will be payable to Participant hereunder.

4. Performance Period . The Performance Period for this Award begins on January 1, 2009 and ends on December 31, 2009.

5. Performance Goals; Amount of Award . The amount of the Award to which Participant is entitled pursuant to this Agreement, if any, is based upon the level of Company’s Adjusted Cash Earnings during the Performance Period as set forth below:

If Company’s Adjusted Cash Earnings over the Performance Period are:	The Annual Performance Cash Award awarded to Participant will be:
At least $250 MM (but not $260 MM)	«PC_Thres» (the Threshold Award), adjusted as described below.
At least $260 MM (but not $275 MM)	«PC_Target» (the Target Award), adjusted as described below.
$275 MM or more	«PC_Max» (the Maximum Award)

If Company’s Adjusted Cash Earnings for the Performance Period are less than $250,000,000, no payment will be due pursuant to this Agreement. If Company’s Adjusted Cash

Earnings for the Performance Period exceed $250,000,000 but are less than $260,000,000, the amount of the payment to which Participant is entitled will be interpolated between the Threshold and Target Award levels. If Company’s Adjusted Cash Earnings for the Performance Period exceed $260,000,000 but are less than $275,000,000, the amount of the payment to which Participant is entitled also will be interpolated between the Target and Maximum Award levels.

7. Determination of Adjusted Cash Earnings and Awards Payable . The Committee will determine the Adjusted Cash Earnings for the Performance Period and the amount of the Award to which Participant is entitled, if any, on or before February 28, 2010. If Participant is Company’s CEO, the Committee then will submit its determinations with respect to the Adjusted Cash Earnings and the amount to which such Participant is entitled to the Board of Directors for review and approval. No amount will be payable to such Participant in the absence of approval by the Board of Directors.

8. Form and Timing of Payment . Participant will receive the payment, if any, on or before March 15, 2010.

9. Termination of Employment Prior to Payment of Award . In order to receive any Award pursuant to this Agreement, Participant must be employed by Company on the date of payment of the Award. If Participant incurs a Termination of Employment with Company prior to such date, no Award is payable to Participant under this Agreement.

10. Prior Awards Pursuant to the Long-Term Performance Cash Program . Through Participant’s acceptance of the Award and this Agreement, Participant acknowledges and agrees that no award is payable to Participant under the Long-Term Performance Cash Program (the “Program”) formerly sponsored by Company. More specifically, Participant agrees that the awards granted to Participant pursuant to the Program, if any, relating to the 2007-2009 and 2008-2010 performance periods are hereby canceled and Participant has no rights to such awards in the future.

11. Withholding and Deductions . Company is authorized to withhold from any payments called for by this Plan all withholding and other taxes due to the federal and any state governments and to take such other action as Company may deem necessary or advisable to enable Company and Participants to satisfy obligations for the payment of withholding taxes and other tax liabilities relating to any payment.

12. Non-Assignability . The Award and Participant’s rights under this Agreement shall not be transferable other than by will or by the laws of descent and distribution. The Performance Cash Award is otherwise non-assignable. (See Section 14 of the Plan). The terms of this Agreement and the Plan shall be binding on the executors, administrators, heirs and successors of Participant.

13. Employment Agreement . Notwithstanding anything to the contrary contained in this Agreement, (a) neither the Plan nor this Agreement is intended to create an express or implied contract of employment for a specified term between Participant and Company and (b) unless otherwise expressed or provided, in writing, by an authorized officer, the employment relationship between Participant and Company shall be defined as “employment at will” wherein either party, without prior notice, may terminate the relationship with or without cause.

14. Administration . This Agreement shall at all times be subject to the terms and conditions of the Plan and the Plan shall in all respects be administered by the Committee in accordance with the terms of and as provided in the Plan. The Committee shall have the sole and complete discretion with respect to the interpretation of this Agreement and the Plan, and all matters reserved to it by the Plan. The decisions of the majority of the Committee with respect thereto and to this Agreement shall be final and binding upon Participant and Company. In the event of any conflict between the terms and conditions of this Agreement and the Plan, the provisions of the Plan shall control.

15. Waiver and Modification . The provisions of this Agreement may not be waived or modified unless such waiver or modification is in writing signed by Company.

16. Validity and Construction . The validity and construction of this Agreement shall be governed by the laws of the State of New Mexico.

IN WITNESS WHEREOF, Company has caused this Performance Cash Award Agreement to be executed on March 27, 2009, by its duly authorized representative and Participant has executed this Agreement.

PNM RESOURCES, INC.

By ________________________________

Alice A. Cobb Participant

Senior Vice President and

Chief Administrative Officer

Exhibit 10.6

Part II Award Agreement

PERFORMANCE SHARE AWARD AGREEMENT

PNM RESOURCES, INC. SECOND AMENDED AND RESTATED

OMNIBUS PERFORMANCE EQUITY PLAN

PNM Resources, Inc., a New Mexico corporation, (“PNMR” or the “Company”) hereby awards to «First» «Last» , (the “Participant”) a Participant in the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “Plan”), as it may be amended, a Performance Share Award (the “Award”) for shares of Common Stock of Company (“Stock”). The grant is made effective as of April 27, 2009.

Capitalized terms used in this Performance Share Award Agreement (the “Agreement”) and not otherwise defined in this Agreement shall have the meanings given to such terms in the Plan.

1. Grant . Company hereby awards to Participant the opportunity to earn Performance Shares in an amount equal to the Threshold, Target or Maximum Award levels listed in Section 4(a) and (b), based upon Company’s performance over the Performance Period (defined in Section 3), in accordance with and subject to the terms and conditions set forth in this Agreement. In no event will the Award exceed the Maximum Award levels indicated in Section 4(a) and (b). If Participant is a Covered Employee, the Award is intended to be a Performance-Based Award granted pursuant to Section 12 of the Plan.

2. Award Subject to Plan . This Award is granted pursuant to the Plan, the terms of which are hereby incorporated by reference.

3. Performance Period . The Performance Period for this Award began on April 1, 2009 and ends on December 31, 2011.

4. Performance Goals; Amount of Award . The amount of the Award to which Participant is entitled pursuant to this Agreement, if any, is based upon the level of Company’s achievement with respect to the two Performance Goals described in this Section. Each of the Performance Goals described in this Section will account for fifty percent of the Participant’s total Award opportunity.

(a) Funds from Operations to Debt (“FFO to Debt”) Ratio Goal : Fifty percent of Participant’s Award will be determined based upon Company’s FFO to Debt Ratio during the Performance Period (the “FFO to Debt Ratio Portion”) as set forth in this Section 4(a).

(i) FFO to Debt Ratio Defined . For purposes of this Agreement, the term FFO to Debt Ratio means Company’s funds from operations (as determined conclusively by Company) for the fiscal year ending on the last day of the Performance Period divided by Company’s total debt outstanding, including any long-term leases and unfunded pension plan obligations, as of the last day of the Performance Period.

(ii) FFO to Debt Ratio Award Levels : Company’s achievement of the FFO to Debt Ratio Goal will determine the amount of the FFO to Debt Ratio Portion of the Award to which Participant is entitled as set forth below:

If Company’s FFO to Debt Ratio over the Performance Period is:	The FFO to Debt Ratio Portion of the Award to Participant will be
Greater than 15.0% but does not exceed 15.5%	[_______] (the Threshold Award), adjusted as described below. 1
Greater than 15.5% but does not exceed 16%	[_______] (the Target Award), adjusted as described below. 2
Greater than 16.0%	[_______] (the Maximum Award), adjusted as described below. 3

If Company’s FFO to Debt Ratio for the Performance Period is equal to or less than 15.0% no payment will be due with respect to the FFO to Debt Ratio Portion of the Award. If Company’s FFO to Debt Ratio for the Performance Period exceeds 15.0% but does not exceed 15.5%, the FFO to Debt Ratio Portion of Participant’s Award will be interpolated between the Threshold and Target Award levels. If Company’s FFO to Debt Ratio for the Performance Period exceeds 15.5% but does not exceed 16.0%, the FFO to Debt Ratio Portion of Participant’s Award also will be interpolated between the Target and Maximum Award levels.

(b) Environmental Goal : Fifty percent of Participant’s Award will be determined based upon Company’s attainment of the Environmental Goal (the “Environmental Goal Portion”), as set forth in this Section 4(b).

(i) Environmental Goal Defined . For purposes of this Agreement, the term “Environmental Goal” means the reduction in the emission levels of (1) nitrous oxide, (2) sulfur dioxide, (3) particulate matter, and (4) mercury (the “Pollutants”) at Company’s San Juan Generating Station (“SJGS”) during the Performance Period to levels that are less than the limits on the emissions of such Pollutants set forth in the Consent Decree entered by the United States District Court for the District of New Mexico on May 10, 2005 in the case of Grand Canyon Trust and Sierra Club v. Public Service Company of New Mexico , Case No. CIV 02-552 (the “Consent Decree”). The Consent Decree limits are set forth in the following table.

Pollutant	Consent Decree Limit
Nitrous Oxide	3.24 pounds/megawatt hour
Sulfur Dioxide	1.51 pounds per megawatt hour
Mercury	90% removal efficiency 4
Particulates	0.16 pounds per megawatt hour

Company will use the following method for determining the level of attainment of the Environmental Goal: (A) Company will measure the emission levels of each of the Pollutants from the SJGS over the course of the Performance Period; (B) Company then will compare the actual emission level for each Pollutant to the Consent Decree limit; (C) next, Company will

______________________________

1 Insert 50% of the total Threshold Award set by the Committee.

2 Insert 50% of the total Target Award set by the Committee.

3 Insert 50% of the total Maximum Award set by the Committee.

4 Company has assumed in establishing the Environmental Goal that, for purposes of measuring Mercury emission reductions, the Consent Decree limit is 90% removal.

calculate the simple percentage variance between the emission of such Pollutant from SJGS and the limit set forth in the Consent Decree, positive or negative (if the actual emission level is less than the Consent Decree limit it will result in a positive percentage variance); (D) Company will then add the percentage variances for all four Pollutants and divide the sum of such percentage variances by four to calculate the average variance for the Pollutants. The average variance for the Pollutants will determine the level of Company’s attainment of the Environmental Goal.

(ii) Environmental Goal Award Levels . Company’s achievement of the Environmental Goal will determine the amount of the Environmental Goal Portion of the Award to which Participant is entitled as set forth below:

If the average variance between the level of emission of the Pollutants at SJGS and the limits set forth in the Consent Decree over the Performance Period is:	The Environmental Goal Portion of Participant’s Award will be:
Greater than or equal to 10%	[______] Performance Shares (the Threshold Award), adjusted as described below. 5
Greater than or equal to 12%	[______] Performance Shares (the Target Award), adjusted as described below. 6
Greater than or equal to 14%	[______] Performance Shares (the Maximum Award) adjusted as described below. 7

If the level of attainment of the Environmental Goal is not greater than or equal to 10%, no payment of the Environmental Goal Portion of the Award will be due pursuant to this Agreement. If the level of attainment of the Environmental Goal is greater than 10% but less than 12%, the amount of the Environmental Goal Portion of the Award to which Participant is entitled will be interpolated between the Threshold and Target Award levels. If the level of attainment of the Environmental Goal is greater than 12% but less than 14%, the amount of the Environmental Goal Portion of the Award to which Participant is entitled also will be interpolated between the Target and Maximum Award levels.

(iii) Discretion to Reduce Environmental Goal Portion of Award . The Committee, in its sole discretion, may reduce (but not increase) the Environmental Goal Portion of the Award, if any, to which Participant is entitled based on such factors as the Committee determines to be appropriate.

5. Determination of Performance Goals and Awards Payable . The Committee will determine the FFO to Debt Ratio and the Environmental Goals for the Performance Period and the amount of the Award to which Participant is entitled, if any, on or before February 28, 2012. If payment of an Award to Participant requires approval of the Board of Directors, the Committee will submit its recommendation with respect to Participant’s Award to the Board of

___________________________

5 Insert 50% of the total Threshold Award set by the Committee.

6 Insert 50% of the total Target Award set by the Committee.

7 Insert 50% of the total Maximum Award set by the Committee.

Directors for approval. No amount will be payable to Participant in the absence of approval by the Board of Directors.

6. Vesting on Termination of Employment .

(a) Termination of Employment Due to Death, Disability, Retirement, Impaction or Change in Control . Upon Participant’s Termination of Employment due to death, Disability, Retirement, Impaction or Change in Control prior to the end of the Performance Period, Participant shall vest in a pro rata portion of the Award to which Participant is entitled at the end of the Performance Period as described in Section 13.1(a)(iv)(2) of the Plan. The amount of the Award to which Participant is entitled hereunder shall be determined at the conclusion of the Performance Period based upon actual performance during the Performance Period.

(b) Involuntary or Voluntary Termination of Employment for Other Reasons . Subject to Section 6(c), upon Participant’s involuntary or voluntary Termination of Employment for any reason other than those set forth in Section 6(a), the Award, if not previously vested, shall be canceled and forfeited immediately.

(c) Termination of Employment for Cause . Upon Participant’s Termination of Employment for Cause, Participant’s right to any Award hereunder shall be canceled and forfeited immediately.

7. Form and Timing of Delivery of Certificate . On or before March 15, 2012, Participant shall receive a Stock certificate evidencing Participant’s ownership of the number of Performance Shares, if any, to which Participant is entitled pursuant to Sections 4 and 5.

8. Withholding and Deductions . Company shall have the right to deduct from any payments made by Company to the Participant, or to require that the Participant remit to Company, an amount sufficient to satisfy any federal, state or local taxes of any kind as are required by law to be withheld with respect to the Performance Shares granted hereunder. Company also shall have the right to take such other actions as may be necessary in the opinion of Company to satisfy the tax withholding and payment obligations related to the Performance Shares granted hereunder. Company may, in its sole discretion, permit the Participant to elect to satisfy the Participant’s minimum statutory tax withholding obligation which may arise in connection with the Performance Shares by requesting that Company withhold shares of Stock having a Fair Market Value of the Stock equal to the minimum statutory tax withholding. Any such election shall be subject to the provisions of applicable law and to any conditions the Committee may determine to be necessary in order to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act. Any shares of Stock deliverable to the Participant under the terms of this Agreement also are subject to offset by Company, and the Participant hereby authorizes such offset, to liquidate and reduce any outstanding debt or unpaid sums owed by the Participant to Company or its successor.

of this Agreement and the Plan shall be binding on the executors, administrators, heirs and successors of Participant.

10. Employment Agreement . Notwithstanding anything to the contrary contained in this Agreement, (a) neither the Plan nor this Agreement is intended to create an express or implied contract of employment for a specified term between Participant and Company and (b) unless otherwise expressed or provided, in writing and by an authorized officer, the employment relationship between Participant and Company shall be defined as “employment at will” wherein either party, without prior notice, may terminate the relationship with or without cause.

11. Administration . This Agreement shall at all times be subject to the terms and conditions of the Plan and the Plan shall in all respects be administered by the Committee in accordance with the terms of and as provided in the Plan. The Committee shall have the sole and complete discretion with respect to the interpretation of this Agreement and the Plan, and all matters reserved to it by the Plan. The decisions of the majority of the Committee with respect thereto and to this Agreement shall be final and binding upon Participant and Company. In the event of any conflict between the terms and conditions of this Agreement and the Plan, the provisions of the Plan shall control.

12. Waiver and Modification . The provisions of this Agreement may not be waived or modified unless such waiver or modification is in writing signed by Company.

13. Validity and Construction . The validity and construction of this Agreement shall be governed by the laws of the State of New Mexico.

14. Dividend Equivalents . Participant is not entitled to receive a dividend equivalent with respect to the Performance Shares awarded pursuant to this Agreement.

15. Compliance with Exchange Act . If Participant is subject to Section 16 of the Exchange Act, Performance Shares granted pursuant to this Award are intended to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act.

16. Voting Rights . Participant will have no voting rights with respect to the Performance Shares until delivery of the Stock certificate in accordance with Section 8.

17. Tax Issues . Pursuant to Section 83 of the Code, the value of the Performance Shares will be taxed as ordinary income as of the date distributed to Participant.

18. Regulatory Approvals and Listing . Company shall not be required to issue any certificate for shares of Stock prior to satisfying any regulatory approval, registration, qualification or other requirements of the Securities and Exchange Commission, the Internal Revenue Service or any other governmental agency which the Committee, in its sole discretion, shall determine to be necessary or advisable.

19. Adjustments . Neither the existence of the Plan nor the Award shall affect, in any way, the right or power of Company to make or authorize any or all adjustments, recapitalizations, reorganizations, or other changes in Company’s capital structure or its

business; or any merger or consolidation of Company; or any corporate act or proceeding, whether of a similar character or otherwise; all of which, and the resulting adjustments in, or impact on, the Award are more fully described in Section 5.3 of the Plan.

20. Participant Representation . As a condition to the receipt of any shares of Stock hereunder, Company may require a representation from the Participant that the Stock is being acquired only for investment purposes and without any present intention to sell or distribute such shares.

IN WITNESS WHEREOF, Company has caused this Performance Share Award Agreement to be executed on ____________ ___, 2009, by its duly authorized representative.

PNM RESOURCES, INC.

Alice A. Cobb

Senior Vice President and

Chief Administrative Officer

Exhibit 10.7

Part II Award Agreement

PERFORMANCE CASH AWARD AGREEMENT

PNM RESOURCES, INC. SECOND AMENDED AND RESTATED

OMNIBUS PERFORMANCE EQUITY PLAN

PNM Resources, Inc., a New Mexico corporation, (“PNMR” or the “Company”) hereby awards to «First» «Last» (the “Participant”), a Participant in the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “Plan”), as it may be amended, a Performance Cash Award (the “Award”) effective as of April 27, 2009.

Capitalized terms used in this Performance Cash Award Agreement (the “Agreement”) and not otherwise defined in this Agreement shall have the meanings given to such terms in the Plan.

1. Grant . Company hereby awards to Participant the opportunity to earn a cash payment in an amount equal to the Threshold, Target or Maximum Award levels listed in Section 4(a) and (b), based upon Company’s performance over the Performance Period (defined in Section 3), in accordance with and subject to the terms and conditions set forth in this Agreement. In no event will the Award exceed the Maximum Award levels indicated in Section 4(a) and (b). If Participant is a Covered Employee, the Award is intended to be a Performance-Based Award granted pursuant to Section 12 of the Plan.

2. Award Subject to Plan . This Award is granted pursuant to the Plan, the terms of which are hereby incorporated by reference.

3. Performance Period . The Performance Period for this Award began on April 1, 2009 and ends on December 31, 2011.

If Company’s FFO to Debt Ratio over the Performance Period is:	The FFO to Debt Ratio Portion of the Award to Participant will be
Greater than 15.0% but does not exceed 15.5%	[$_______] (the Threshold Award), adjusted as described below. 1
Greater than 15.5% but does not exceed 16%	[$_______] (the Target Award), adjusted as described below. 2
Greater than 16.0%	[$_______] (the Maximum Award), adjusted as described below. 3

Pollutant	Consent Decree Limit
Nitrous Oxide	3.24 pounds/megawatt hour
Sulfur Dioxide	1.51 pounds per megawatt hour
Mercury	90% removal efficiency 4
Particulates	0.16 pounds per megawatt hour

____________________________

1 Insert 50% of the total Threshold Award set by the Committee.

2 Insert 50% of the total Target Award set by the Committee.

3 Insert 50% of the total Maximum Award set by the Committee.

4 Company has assumed in establishing the Environmental Goal that, for purposes of measuring Mercury emission reductions, the Consent Decree limit is 90% removal.

calculate the simple percentage variance between the emission of such Pollutant from SJGS and the limit set forth in the Consent Decree, positive or negative (if actual emission level is less than the Consent Decree limit it will result in a positive percentage variance); (D) Company will then add the percentage variances for all four Pollutants and divide the sum of such percentage variances by four to calculate the average variance for the Pollutants. The average variance for the Pollutants will determine the level of Company’s attainment of the Environmental Goal.

(ii) Environmental Goal Award Levels . Company’s level of achievement of the Environmental Goal (described above) will determine the amount of the Environmental Goal Portion of the Award to which Participant is entitled as set forth below:

If the average variance between the level of emission of the Pollutants at SJGS and the limits set forth in the Consent Decree over the Performance Period is:	The Environmental Goal Portion of Participant’s Award will be:
Greater than or equal to 10%	[$______] (the Threshold Award), adjusted as described below. 5
Greater than or equal to 12%	[$______] (the Target Award), adjusted as described below. 6
Greater than or equal to 14%	[$______] (the Maximum Award) adjusted as described below. 7

If the level of attainment of the Environmental Goal is not greater than or equal to 10%, no payment for the Environmental Goal Portion of the Award will be due pursuant to this Agreement. If the level of attainment of the Environmental Goal is greater than 10% but less than 12%, the amount of the Environmental Goal Portion of the Award to which Participant is entitled will be interpolated between the Threshold and Target Award levels. If the level of attainment of the Environmental Goal is greater than 12% but less than 14%, the amount of the Environmental Goal Portion of the Award to which Participant is entitled also will be interpolated between the Target and Maximum Award levels.

5. Determination of Performance Goals and Awards Payable . The Committee will determine the FFO to Debt Ratio and the level of attainment of the Environmental Goals for the Performance Period and the amount of the Award to which Participant is entitled, if any, on or before February 28, 2012. If payment of an Award to Participant requires approval of the Board of Directors, the Committee will submit its recommendation with respect to such

______________________________

5 Insert 50% of the total Threshold Award set by the Committee.

6 Insert 50% of the total Target Award set by the Committee.

7 Insert 50% of the total Maximum Award set by the Committee.

Participant’s Award to the Board of Directors for approval. No amount will be payable to Participant in the absence of approval by the Board of Directors.

6. Vesting on Termination of Employment .

(a) Due to Death, Disability, Retirement, Impaction or Change in Control . Upon Participant’s Termination of Employment due to death, Disability, Retirement, Impaction or Change in Control prior to the end of the Performance Period, Participant shall vest in a pro rata portion of the Award to which Participant is entitled at the end of the Performance Period based on the level of achievement of the Performance Goals described in Section 4(a) and (b). The Payment to which Participant is entitled for the pro rata portion of the vested Award shall be based on the number of full months included in the Performance Period as of the date of Participant’s Termination of Employment compared to the number of full months included in the Performance Period. The amount of the Award to which Participant is entitled hereunder shall be determined at the conclusion of the Performance Period based upon actual performance during the Performance Period. The Award, if any, shall be paid at the time and in the form described in Section 7.

(c) Termination for Cause . Upon Participant’s Termination of Employment for Cause, Participant’s right to any Award hereunder shall be canceled and forfeited immediately.

7. Form and Timing of Payment . Participant will receive the payment of the Award, if any, in one lump sum cash payment on or before March 15, 2012.

8. Withholding and Deductions . Company is authorized to withhold from any payments called for by this Agreement all withholding and other taxes due to the federal and any state governments and to take such other action as Company may deem necessary or advisable to enable Company and Participant to satisfy obligations for the payment of withholding taxes and other tax liabilities relating to any payment.

9. Non-Assignability . The Award and Participant’s rights under this Agreement shall not be transferable other than by will or by the laws of descent and distribution. The Performance Cash Award is otherwise non-assignable. (See Section 14 of the Plan). The terms of this Agreement and the Plan shall be binding on the executors, administrators, heirs and successors of Participant.

will” wherein either party, without prior notice, may terminate the relationship with or without cause.

12. Waiver and Modification . The provisions of this Agreement may not be waived or modified unless such waiver or modification is in writing signed by Company.

13. Validity and Construction . The validity and construction of this Agreement shall be governed by the laws of the State of New Mexico.

IN WITNESS WHEREOF, Company has caused this Performance Cash Award Agreement to be executed on ____________ ___, 2009, by its duly authorized representative.

PNM RESOURCES, INC.

Alice A. Cobb

Senior Vice President and

Chief Administrative Officer

Exhibit 10.8

RESTRICTED STOCK RIGHTS AWARD AGREEMENT

PNM RESOURCES, INC.

SECOND AMENDED AND RESTATED

OMNIBUS PERFORMANCE EQUITY PLAN

PNM Resources, Inc., a New Mexico corporation, (“PNMR” or the “Company”) hereby awards to «First» «Last» , (the “Grantee”), a Participant in the PNM Resources, Inc. Second Amended and Restated Omnibus Performance Equity Plan (the “Plan”), as it may be amended, a Restricted Stock Rights Award (the “Award”) for the number of shares of common stock of the Company (“Stock”) noted below. The grant is made effective as of the ____ day of ________, 2009 (the “Grant Date”).

Capitalized terms used in this Restricted Stock Rights Award Agreement (the “Agreement”) and not otherwise defined herein shall have the meanings given to such terms in the Plan.

1. Grant . Grantee is hereby granted a Restricted Stock Rights Award for «Total_Restricted_Stock» shares of Stock. This Award is granted pursuant to the Plan, the terms of which are hereby incorporated by reference.

2. Vesting .

(a) Except as set forth below, these Restricted Stock Rights shall vest in the following manner: (i) 33% of the Restricted Stock Rights will vest on the first anniversary of the Grant Date; (ii) an additional 34% of the Restricted Stock Rights will vest on the second anniversary of the Grant Date; and (iii) the final 33% of the Restricted Stock Rights will vest on the third anniversary of the Grant Date.

(b) Upon Grantee’s Separation from Service due to death, Disability, Retirement, Impaction or Change in Control, nonvested Restricted Stock Rights shall become 100% vested in accordance with the applicable provisions of the Plan.

(c) Upon Grantee’s involuntary or voluntary Separation from Service for any reason other than those set forth in Subparagraph (b) above, the Restricted Stock Rights, if not previously vested, shall be canceled and forfeited immediately.

(d) Upon Grantee’s Separation from Service for Cause, all nonvested Restricted Stock Rights shall be terminated and forfeited immediately.

3. Form and Timing of Delivery of Certificate .

(a) If any Restricted Stock Rights granted hereunder vest as described in Section 2(a), the Grantee will receive the Stock payable with respect to such vested Restricted Stock Rights within ninety (90) days following the dates on which the Restricted Stock Rights vest.

(b) If any Restricted Stock Rights granted hereunder vest as described in Section 2(b), the Grantee will receive the Stock payable with respect to such Restricted Stock Rights within ninety (90) days following the date of the Grantee’s Separation from Service.

(c) The Restricted Stock Rights granted hereunder are subject to the requirements of Section 409A of the Code. Accordingly, the restrictions described in Section 20.3 of the Plan apply to the Restricted Stock Rights. In addition, if the Grantee is a Specified Employee at the time of the Grantee’s Separation from Service, the six (6) month delay in payments to a Specified Employee upon a Separation from Service (described in Section 20.3 of the Plan) applies.

4. Adjustments . Neither the existence of the Plan nor the Award shall affect, in any way, the right or power of the Company to make or authorize: any or all adjustments, recapitalizations, reorganizations, or other changes in the Company’s capital structure or its business; or any merger or consolidation of the Company; or any corporate act or proceeding, whether of a similar character or otherwise; all of which, and the resulting adjustments in, or impact on, the Award are more fully described in Section 5.3 of the Plan.

5. Withholding and Deductions . The Company shall have the right to deduct from any payments made by the Company to Grantee, or to require that the Grantee remit to the Company, an amount sufficient to satisfy any federal, state or local taxes of any kind as are required by law to be withheld with respect to the delivery of shares of Stock as payment for the Restricted Stock Rights granted hereunder. The Company also shall have the right to take such other actions as may be necessary in the opinion of the Company to satisfy all obligations for withholding and payment of such taxes. The Company may, in its sole discretion, permit the Grantee to elect to satisfy the minimum statutory tax withholding obligation which may arise in connection with the Restricted Stock Rights by requesting that the Company withhold shares of Stock having a Fair Market Value on the date of withholding equal to the amount of the minimum statutory tax withholding. Any such election shall be subject to the provisions of applicable law and to any conditions the Committee may determine to be necessary in order to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act.

6. Dividend Equivalents . The Grantee will not be entitled to receive a dividend equivalent for any of the Restricted Stock Rights granted hereunder.

7. Compliance with Exchange Act . If the Grantee is subject to Section 16 of the Exchange Act, Restricted Stock Rights granted pursuant to this Award are intended to comply with all applicable conditions of Rule 16b-3 or its successors under the Exchange Act.

8. Non-Assignability . The Award and Grantee’s rights under this Agreement shall not be transferable other than by will or by the laws of descent and distribution. The Restricted Stock Rights are otherwise non-assignable. (See Section 14 of the Plan). The terms hereof shall be binding on the executors, administrators, heirs and successors of the Grantee.

9. Voting Rights . During the Restricted Period, the Grantee will have no voting rights with respect to nonvested Restricted Stock Rights.

10. Grantee Representation . As a condition to the receipt of any shares of Stock hereunder, the Company may require a representation from the Grantee that the Stock is being acquired only for investment purposes and without any present intention to sell or distribute such shares.

11. Employment Agreement . Notwithstanding anything to the contrary contained in this Agreement, (a) neither the Plan nor this Agreement is intended to create an express or implied contract of employment for a specified term between the Grantee and the Company and (b) unless otherwise expressed or provided, in writing, by an authorized officer, the employment relationship between the Grantee and the Company shall be defined as “employment at will” wherein either party, without prior notice, may terminate the relationship with or without cause.

12. Regulatory Approvals and Listing . The Company shall not be required to issue any certificate for shares of Stock upon the vesting of Restricted Stock Rights granted under this Agreement prior to satisfying any regulatory approval, registration, qualification or other requirements of the Securities and Exchange Commission, the Internal Revenue Service or any other governmental agency which the Committee, in its sole discretion, shall determine to be necessary or advisable. (See Section 20.1 of the Plan).

13. Administration . This Agreement shall at all times be subject to the terms and conditions of the Plan and the Plan shall in all respects be administered by the Committee in accordance with the terms of and as provided in the Plan. The Committee shall have the sole and complete discretion with respect to the interpretation of this Agreement and the Plan, and all matters reserved to it by the Plan. The decisions of the majority of the Committee with respect thereto and to this Agreement shall be final and binding upon Grantee and the Company. In the event of any conflict between the terms and conditions of this Agreement and the Plan, the provisions of the Plan shall control.

14. Waiver and Modification . The provisions of this Agreement may not be waived or modified unless such waiver or modification is in writing signed by the Company.

15. Validity and Construction . The validity and construction of this Award shall be governed by the laws of the State of New Mexico.

IN WITNESS WHEREOF, the Company has caused this Restricted Stock Rights Award Agreement to be executed on _________ ____, 2009, by its duly authorized representative.

PNM RESOURCES, INC.

Alice A. Cobb

Senior Vice President and

Chief Administrative Officer