<PAGE>
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the period ended March 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-6986
PUBLIC SERVICE COMPANY OF NEW MEXICO
(Exact name of registrant as specified in its charter)
New Mexico 85-0019030
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Alvarado Square, Albuquerque, New Mexico 87158
(Address of principal executive offices)
(Zip Code)
(505) 241-2700
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock--$5.00 par value 41,774,083 shares
Class Outstanding at May 11, 1995
<PAGE>
<PAGE>
PUBLIC SERVICE COMPANY OF NEW MEXICO AND SUBSIDIARIES
INDEX
Page No.
PART I. FINANCIAL INFORMATION:
Report of Independent Public Accountants 3
ITEM 1. FINANCIAL STATEMENTS
Consolidated Statements of Earnings--
Three Months Ended March 31, 1995 and 1994 4
Consolidated Balance Sheets--
March 31, 1995 and December 31, 1994 5
Consolidated Statements of Cash Flows--
Three Months Ended March 31, 1995 and 1994 6
Notes to Consolidated Financial Statements 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8
PART II. OTHER INFORMATION:
ITEM 1. LEGAL PROCEEDINGS 13
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 14
ITEM 5. OTHER INFORMATION 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 15
Signature 16
<PAGE>
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Stockholders
of Public Service Company of New Mexico:
We have reviewed the accompanying condensed consolidated balance sheet of
Public Service Company of New Mexico (a New Mexico corporation) and
subsidiaries as of March 31, 1995, and the related condensed consolidated
statements of earnings and cash flows for the three-month periods ended March
31, 1995 and 1994. These financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the financial statements referred to above for them to be
in conformity with generally accepted accounting principles.
We have previously audited in accordance with generally accepted auditing
standards, the consolidated balance sheet of Public Service Company of New
Mexico and subsidiaries as of December 31, 1994 (not presented herein). In
our report dated February 23, 1995, we expressed an unqualified opinion on
that statement. In our opinion, the information set forth in the
accompanying condensed consolidated balance sheet as of December 31, 1994, is
fairly presented, in all material respects, in relation to the consolidated
balance sheet from which it has been derived.
ARTHUR ANDERSEN LLP
Albuquerque, New Mexico
May 9, 1995
<PAGE>
<PAGE>
<TABLE>
ITEM 1. FINANCIAL STATEMENTS
PUBLIC SERVICE COMPANY OF NEW MEXICO AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF EARNINGS
(Unaudited)
<CAPTION>
Three Months Ended
March 31
------------------
1995 1994
---- ----
(In thousands except
per share amounts)
<S>
Operating revenues: <C> <C>
Electric $141,608 $148,668
Gas 86,200 109,419
Water 2,427 2,720
-------- --------
Total operating revenues 230,235 260,807
-------- --------
Operating expenses:
Fuel and purchased power 31,866 32,158
Gas purchased for resale 43,582 63,293
Other operation and maintenance 81,211 79,656
Depreciation and amortization 20,515 18,737
Taxes, other than income taxes 9,669 10,193
Income taxes 9,661 14,099
-------- --------
Total operating expenses 196,504 218,136
-------- --------
Operating income 33,731 42,671
-------- --------
Other income and deductions, net of taxes 1,575 (47)
-------- --------
Income before interest charges 35,306 42,624
-------- --------
Interest charges:
Interest on long-term debt 15,434 17,182
Other interest charges 1,688 1,405
Allowance for borrowed funds used
during construction - (66)
-------- --------
Net interest charges 17,122 18,521
-------- --------
Net earnings 18,184 24,103
Preferred stock dividend requirements 1,538 1,681
-------- --------
Net earnings applicable to common stock $ 16,646 $ 22,422
======== ========
Average shares of common stock outstanding 41,774 41,774
======== ========
Net earnings per share of common stock $ 0.40 $ 0.54
======== ========
Dividends paid per share of common stock $ - $ -
======== ========
The accompanying notes are an integral part of these financial statements.
/TABLE
<PAGE>
<PAGE>
<TABLE>
PUBLIC SERVICE COMPANY OF NEW MEXICO AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
March 31, December 31,
1995 1994
-------- -----------
(Unaudited)
<S> (In thousands)
ASSETS <C> <C>
Utility plant $2,619,687 $2,587,592
Accumulated provision for depreciation and amortization (924,845) (890,905)
---------- ----------
Net utility plant 1,694,842 1,696,687
---------- ----------
Other property and investments 34,040 34,523
---------- ----------
Current assets:
Cash 23,015 21,029
Temporary investments, at cost 30,510 74,521
Receivables 113,119 129,048
Income taxes receivable - 4,182
Fuel, materials and supplies 49,425 51,068
Gas in underground storage 8,492 8,744
Other current assets 9,160 9,549
---------- ----------
Total current assets 233,721 298,141
---------- ----------
Deferred charges 166,858 173,914
---------- ----------
$2,129,461 $2,203,265
========== ==========
CAPITALIZATION AND LIABILITIES
Capitalization:
Common stock equity:
Common stock $ 208,870 $ 208,870
Additional paid-in capital 469,708 469,648
Excess pension liability, net of tax (1,106) (1,106)
Retained earnings (deficit) since January 1, 1989
(appropriated $4.7 million as of March 31, 1995) (29,360) (46,006)
---------- ----------
Total common stock equity 648,112 631,406
Cumulative preferred stock:
Without mandatory redemption requirements 59,000 59,000
With mandatory redemption requirements 17,975 17,975
Long-term debt, less current maturities 746,839 752,063
---------- ----------
Total capitalization 1,471,926 1,460,444
---------- ----------
Current liabilities:
Short-term debt 65,000 -
Accounts payable 58,161 105,213
Current maturities of long-term debt 35,869 148,532
Accrued interest and taxes 37,148 28,073
Other current liabilities 44,861 43,662
---------- ----------
Total current liabilities 241,039 325,480
---------- ----------
Deferred credits 416,496 417,341
---------- ----------
$2,129,461 $2,203,265
========== ==========
The accompanying notes are an integral part of these financial statements.
/TABLE
<PAGE>
<PAGE>
<TABLE>
PUBLIC SERVICE COMPANY OF NEW MEXICO AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Three Months Ended
March 31
------------------
1995 1994
---- ----
<S> (In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES: <C> <C>
Net earnings $18,184 $24,103
Adjustments to reconcile net earnings to net cash
flows from operating activities:
Depreciation and amortization 25,001 22,931
Accumulated deferred investment tax credit (1,162) (1,295)
Accumulated deferred income tax 249 3,476
Changes in certain assets and liabilities:
Receivables 20,111 14,204
Fuel, materials and supplies 1,895 (3,766)
Deferred charges 6,727 13,204
Accounts payable (47,059) (39,744)
Accrued interest and taxes 9,075 7,553
Deferred credits (1,714) (2,628)
Other 1,805 5,167
Other, net 1,864 1,711
------- -------
Net cash flows from operating activities 34,976 44,916
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Utility plant additions (22,779) (26,884)
(Increase) decrease in other property 299 (274)
Temporary investments, net 44,011 -
------- -------
Net cash flows from investing activities 21,531 (27,158)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Redemption of PV lease obligation bonds (132,663) -
Redemptions and repurchases of preferred stock - (1,419)
Bond redemption premium and costs (85) -
Proceeds from asset securitization 18,758 -
Repayments of long-term debt (4,000) (10,568)
Net increase in short-term debt 65,000 -
Dividends paid (1,531) (1,704)
------- -------
Net cash flows from financing activities (54,521) (13,691)
------- -------
Increase in cash 1,986 4,067
Cash at beginning of period 21,029 20,510
------- -------
Cash at end of period $23,015 $24,577
======= =======
SUPPLEMENTAL CASH FLOW DISCLOSURES:
Interest paid $20,833 $19,368
======= =======
Income taxes paid, net $ - $ -
======= =======
The accompanying notes are an integral part of these financial statements.
/TABLE
<PAGE>
<PAGE>
PUBLIC SERVICE COMPANY OF NEW MEXICO AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) General Accounting Policy
In the opinion of management, the accompanying unaudited consolidated financial
statements contain all adjustments necessary for a fair presentation of the
consolidated financial statements. The accounting policies followed by Public
Service Company of New Mexico (the "Company") are set forth in note (1) of notes
to the Company's consolidated financial statements in the Company's Annual Re-
port on Form 10-K for the year ended December 31, 1994 (the "1994 Form 10-K")
filed with the Securities and Exchange Commission.
(2) Palo Verde Nuclear Generating Station ("PVNGS") Lease Obligation Bonds
("LOBs") Redemption
On March 8, 1995, approximately $121 million of PVNGS LOBs were retired. The
retired LOBs consisted of approximately $58 million of 10.30% LOBs due 2014
retired at a price of 100% of par and approximately $63 million of 10.15% LOBs
due 2016 retired at a price of 97.8% of par. Additionally, approximately $4.4
million and $4.8 million of LOBs due 1996 and 1997 at interest rates of 9.125%
and 8.95%, respectively, were retired at par on March 22, 1995. In connection
with the LOB retirements, approximately $65 million was borrowed under the
Company's liquidity arrangements and approximately $19 million was obtained un-
der the securitization facility related to certain amounts being recovered from
gas customers relating to certain gas contract settlements. The Company intends
to repay the borrowing from proceeds of pending asset sales. In conjunction with
these retirements, the Company wrote off approximately $1.5 million of net costs
related to these transactions. The retirement of the LOBs, which were the
Company's highest cost debt, will save the Company approximately $11 million
annually in interest expense over the next five years.
<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The Company's 1994 Form 10-K PART II, ITEM 7.--"MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" discussed manage-
ment's assessment of the Company's financial condition, results of operations
and other issues facing the Company. The following discussion supplements the
1994 Form 10-K discussion and should be read in conjunction with the consoli-
dated financial statements presented herein and in the 1994 Form 10-K.
LIQUIDITY AND CAPITAL RESOURCES
The Company's construction expenditures for the first quarter of 1995 were
approximately $22.8 million. During the remainder of 1995, the Company
anticipates it will spend approximately $87 million for additional construction
expenditures and approximately $100 million for the retirement of additional
long-term debt.
The Company expects that such cash requirements are to be met primarily through
internally-generated cash. However, to cover differences in the amounts and
timing of cash generation and cash requirements, the Company intends to utilize
short-term borrowings under its liquidity arrangements, which consist of a $100
million secured revolving credit facility ("Facility"), a $40 million credit
facility collateralized by the Company's electric customer accounts receivable,
and $11 million in local lines of credit. As of March 31, 1995, the Company had
short-term borrowings of $40 million under the credit facility collateralized by
the electric customer accounts receivable and $25 million under the Facility,
and temporary investments of $ 30.5 million.
The Company received New Mexico Public Utility Commission ("NMPUC") authoriza-
tion on May 1, 1995, to extend the Facility, which was to expire on June 13,
1995, for an additional three years. The Company expects to renew the Facility
before its expiration date.
Credit Rating
In addition to the recent upgrade of the Company's security rating outlook from
"stable" to "positive" by Standard & Poor's Corp., Duff & Phelps Inc. upgraded
the EIP Funding Corp. secured lease obligation bonds and the Company's preferred
stock. Duff & Phelps Inc. stated that the upgrade reflects, among other things,
the Company's progress toward restructuring its rates and operations, improving
the Company's competitive position by lowering rates and providing the Company
with a reasonable framework for gradually improving its financial position.
Duff & Phelps Inc. further stated that with the Company's reduced regulatory
uncertainty and business risk, credit protection measures are expected to
gradually improve.
<PAGE>
<PAGE>
RESULTS OF OPERATIONS
The financial performance of the excluded resources improved from last year's
quarter as a result of the sale of 35 MW of San Juan Generating Station ("SJGS")
Unit 4 to Utah Associated Municipal Power Systems ("UAMPS") and reduced PVNGS
Unit 3 operation and maintenance ("O&M") expenses. Operating results for the
excluded resources for these periods reflect the allocation of interest charges
based on the average investment in excluded net utility plant as a percent of
total utility plant for the period. Selected financial information for the
excluded resources is shown below:
Three Months Ended
March 31
--------
1995 1994
---- ----
(In thousands)
Operating revenues $ 9,061 $ 9,854
Operating income $ 11319 $ 87
Net loss $ (116) $ (1,644)
Net utility plant at end of period $140,252* $158,350
* Decrease is a result of the sale of 35 MW of SJGS Unit 4 to UAMPS.
Electric gross margin (electric operating revenues less fuel and purchased power
expense) decreased $6.8 million in the current quarter due to: (1) reduced off-
system sales of $5.8 million as a result of the expiration of three power sale
contracts and generally poor wholesale power market conditions caused by the
abundance of inexpensive hydro power and warmer than usual temperatures and (2)
a difference of $6.7 million between the estimated unbilled revenues reported in
the fourth quarter of 1993 and actual unbilled revenues recorded in the first
quarter of 1994. Partially offsetting such decrease was the increase in retail
revenues (net of the effect of retail rate reductions) resulting from increased
load growth.
Gas gross margin (gas operating revenues less gas purchased for resale) de-
creased $3.5 million from the same quarter last year due to a decrease in gas
deliveries resulting from much warmer than normal weather experienced in the
first quarter of 1995.
Other O&M expenses increased $1.6 million from last year's quarter as a result
of higher distribution expense of $1.4 million attributed to increased tree
trimming and maintenance expenses, higher production O&M expense for the gas and
oil-fired units of $1.1 million resulting from the maintenance outages in the
first quarter of 1995, and higher transmission expense of $.9 million. Such
increases were partially offset by lower O&M expenses of $2.0 million related to
outages at Four Corners Generating Station and PVNGS during the first quarter of
1994.
Depreciation and amortization expenses increased $1.8 million in the current
quarter as a result of implementing the new depreciation rates approved by the
NMPUC.
Other income and deductions (net) increased $1.6 million from the same quarter
last year due to an after-tax accrual of $2.6 million of income resulting from
the carrying costs related to gas take-or-pay settlement amounts, which was
partially offset by an after-tax write-off of debt retirement expenses of $.9
million.
Net interest charges decreased $1.4 million in the current quarter due to the
retirement of $45 million of 10.125% first mortgage bonds in April 1994.
<PAGE>
<PAGE>
OTHER ISSUES FACING THE COMPANY
OLE Project
As previously reported, plans to construct the OLE transmission line, a 345 Kv
line connecting the existing Ojo 345 Kv line to the Norton station in northern
New Mexico, had faced considerable opposition by persons concerned primarily
about the environmental impacts of the project. As a result, in 1994, an
alternative route was identified. (See PART II, ITEM 7.--"MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS--OTHER
ISSUES FACING THE COMPANY--TRANSMISSION ISSUES--OLE Transmission Project" in the
Company's 1994 Form 10-K.)
The proposed alternative route required endorsements from the three affected
Indian tribes prior to the construction of the line across those tribal lands.
One of the three Indian tribes has withdrawn its support for the proposed
alternative route. Given that development, the Company advised the hearing
examiner at a prehearing conference held on May 8, 1995, that the Company is
unable to identify a viable alternative and requested a decision on the
application for the OLE line as originally filed. The Company is awaiting a
final decision from the NMPUC.
Sale of SDCW
As previously reported, in February 1994, the Company and the City of Santa Fe
(the "City") entered into a purchase and sale agreement for the Company's water
division. (See PART II, ITEM 7.--"MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULT OF OPERATIONS--OTHER ISSUES FACING THE COMPANY--
SALE OF SDCW".) The Company's current estimate of the sales price is
approximately $52 million. Such amount will be adjusted in accordance with the
terms and conditions of the contract at the time of sale. On March 9, 1995,
the hearing examiner issued his recommended decision, recommending approval of
the sale and the terms and condition of the agreement reached with the City.
The Company currently expects that the closing will occur in the second quarter
of 1995.
Open Transmission Access and Stranded Cost
On March 29, 1995, the Federal Energy Regulatory Commission ("FERC") issued its
Notice of Proposed Rulemakings on various issues pertaining to restructuring of
the wholesale electric industry. The FERC is seeking comments on various issues,
including non-discriminatory transmission access, stranded cost recovery and
functional unbundling of generation and transmission services. The Company is
currently evaluating these issues and plans to file responses with the FERC.
The Company does not anticipate a final ruling from FERC in 1995.
Gas Assets Sale
As previously reported,in February 1994, an agreement was executed with Williams
Gas Processing--Blanco, Inc, a subsidiary of the Williams Field Services Group,
Inc., of Tulsa, Oklahoma, for the sale of the assets of the Company's gas
gathering and processing subsidiaries and for the sale of Northwest andSoutheast
gas gathering and processing facilities of the Company. The agreement provides
for a cash selling price of $155 million, subject to certain adjustments. The
Company would recognize an after-tax gain of approximately $14.1 million from
the sale.The sale is subject to NMPUC approval.(See "MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS--OTHER ISSUES FACING
THE COMPANY--SALE OF GAS GATHERING AND PROCESSING ASSETS" in the Company's 1994
Form 10-K).
On April 14, 1995, the hearing examiner issued his recommended decision,
recommending approval of the sale. If NMPUC approval is issued on an expedited
basis, the Company expects to finalize the sale by the end of July 1995. How-
ever, the Company cannot predict the ultimate timing or outcome of the NMPUC
action.
<PAGE>
<PAGE>
PART II--OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Archaeological Site Damage
In March 1995, a contractor installing gas pipeline on State Road 14 on behalf
of the Company damaged an archaeological site located in the New Mexico State
Highway and Transportation Department ("NMSHTD") right-of-way. The contractor
was installing the gas pipeline at the direction of the Company. The Company
notified both the NMSHTD and the New Mexico State Historic Preservation Office
("SHPO"). The Company conducted an investigation and provided information
regarding the site,damage and remedial measures in response to requests from the
NMSHTD. The incident may subject the Company and its employees to criminal and
civil liability under the New Mexico Cultural Properties Act ("NMCPA"). Under
NMCPA, the maximum civil penalty can be the cost of restoration, stabilization
or interpretation of the archaeological site, or twice such cost in the court's
discretion. The likelihood and type of any citations, prosecutions or civil
penalties that may be pursued by either the NMSHTD or the SHPO are unknown at
this time. Although the Company is unable to predict the outcome of any
proceeding stemming from this incident, the Company does not expect that the
ultimate resolution will have a material adverse effect on the Company's
financial condition or results of operation.
<PAGE>
<PAGE>
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the annual meeting of shareholders held on April 25, 1995, the shareholders
elected the following three nominees to serve as directors until the annual
meeting of shareholders in 1998, or until their successors are duly elected and
qualified, as follows:
Votes
Against Broker
Director Votes For or Withheld Abstentions Non-Votes
-------- --------- ----------- ----------- ---------
J. T. Ackerman 36,296,038 364,260 * *
J. A. Godwin 36,276,828 383,470 * *
M. Lujan, Jr. 36,287,787 372,511 * *
The approval of the selection by the Company's board of directors of Arthur
Andersen LLP as independent auditors for the fiscal year ending December 31,
1995, was voted on, as follows:
Votes
Against Broker
Votes for or Withheld Abstentions Non-Votes
--------- ----------- ----------- ---------
36,354,331 145,877 160,090 *
* Not applicable or not readily available.
LOBs Consent Solicitation
On January 12, 1995, the Company and First PV Funding Corporation ("First PV")
commenced the Solicitation of Consents to certain proposed amendments to the
Indenture governing the 10.30% Lease Obligation Bonds Series 1986A due 2014,
9.125% Lease Obligation Bonds Series 1986A due 1996, 10.15% Lease Obligation
Bonds Series 1986B due 2016 and 8.95% Lease Obligation Bonds Series 1986B due
1997 (the "LOBs"). The purpose of the proposed amendments was to facilitate the
retirement or acquisition at current market prices of certain LOBs.
At the conclusion of the Solicitation of Consents on March 1, 1995, bondholders
owning $560,067,000 in aggregate principal amount of LOBs, or about 91% of the
$614,933,000 of LOBs outstanding had given their consent to amending the
Indenture governing such LOBs. The Company paid $2.50 in cash for each $1,000
in principal amount of LOBs for which a proper consent was given.
ITEM 5. OTHER INFORMATION
Nuclear Fuel Supply
The Company has made arrangements through contract flexibilities to obtain
quantities of uranium concentrates anticipated to be sufficient to meet its
share of uranium concentrates requirements through 2000. The Company's existing
contracts and options could be utilized to meet 75% of such requirements in 2001
and 2002 and 40% of requirements from 2003 through 2007.The Company understands
that other PVNGS participants have made arrangements for the uranium concentrate
requirements through 1997. Their existing contracts and options could be
utilized to meet 80% of requirements in 1998 and 1999 and 70% of requirements
from 2000 through 2006. The PVNGS participants, including the Company,
contracted for all conversion services required through 2000 with options for up
to 70% through 2002. The PVNGS participants, including the Company, also have an
enrichment services contract with United States Enrichment Corporation ("USEC")
which obligates USEC to furnish enrichment services required for the operation
of the three PVNGS units over a term expiring in September 2002, with options to
continue through September 2007.
<PAGE>
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
10.18.4 Amendment No. 4 dated as of March 8, 1995, to Facility Lease
between Public Service Company of New Mexico and The First
National Bank of Boston, dated as of December 16, 1985
10.20.3 Amendment No. 3 dated as of March 8, 1995, to Facility Lease
between Public Service Company of New Mexico and The First
National Bank of Boston, dated as of August 12, 1986
10.64* Results Pay
15.0 Letter Re Unaudited Interim Financial Information
27 Financial Data Schedule
99.1.6 1995 Supplemental Indenture among First PV Funding Corporation,
Public Service Company of New Mexico and Chemical Bank, as
Trustee dated as of February 14, 1995
99.3.3 Supplemental Indenture No. 3 dated as of March 8, 1995, to Trust
Indenture, Mortgage, Security Agreement and Assignment of Rents
between The First National Bank of Boston and Chemical Bank dated
as of December 16, 1985
99.9.1 Supplemental Indenture No. 2 dated as of March 8, 1995, to Trust
Indenture, Mortgage, Security Agreement and Assignment of Rents
between The First National Bank of Boston and Chemical Bank dated
as of August 12, 1986
*Designates each management contract, compensatory plan or arrangement
required to be filed as an exhibit to this report.
b. Reports on Form 8-K:
None, other than the previously filed Form 8-Ks described in the 1994 Form
10-K.
<PAGE>
<PAGE>
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PUBLIC SERVICE COMPANY OF NEW MEXICO
(Registrant)
Date: May 11, 1995 /s/ Donna M. Burnett
-----------------------------------
Donna M. Burnett
Corporate Controller and
Chief Accounting Officer
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This schedule contains summary financial information extracted from the
Company's Consolidated Statements of Earnings, Consolidated Balance Sheets and
Consolidated Statements of Cash Flows for the period ended March 31, 1995 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,694,842
<OTHER-PROPERTY-AND-INVEST> 34,040
<TOTAL-CURRENT-ASSETS> 233,721
<TOTAL-DEFERRED-CHARGES> 166,858
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 2,129,461
<COMMON> 208,870
<CAPITAL-SURPLUS-PAID-IN> 468,602
<RETAINED-EARNINGS> (29,360)
<TOTAL-COMMON-STOCKHOLDERS-EQ> 648,112
17,975
59,000
<LONG-TERM-DEBT-NET> 746,839
<SHORT-TERM-NOTES> 65,000
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 35,869
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 556,666
<TOT-CAPITALIZATION-AND-LIAB> 2,129,461
<GROSS-OPERATING-REVENUE> 230,235
<INCOME-TAX-EXPENSE> 10,693
<OTHER-OPERATING-EXPENSES> 186,843
<TOTAL-OPERATING-EXPENSES> 196,504
<OPERATING-INCOME-LOSS> 33,731
<OTHER-INCOME-NET> 1,575
<INCOME-BEFORE-INTEREST-EXPEN> 35,306
<TOTAL-INTEREST-EXPENSE> 17,122
<NET-INCOME> 18,184
1,538
<EARNINGS-AVAILABLE-FOR-COMM> 16,646
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 14,791
<CASH-FLOW-OPERATIONS> 34,976
<EPS-PRIMARY> 0.40
<EPS-DILUTED> 0
</TABLE>
<PAGE>
ARTHUR
ANDERSEN
ARTHUR ANDERSEN LLP
May 9, 1995
Arthur Andersen LLP
Suite 400
6501 Americas Parkway NE
Albuquerque, NM 87110-5372
505 889-4700
Public Service Company of New Mexico
Alvarado Square
Albuquerque, NM 87158
Gentlemen:
We are aware that Public Service Company of New Mexico has incorporated by
reference in its Registration Statement No. 33-65418 its Form 10-Q for
the quarter ended March 31, 1995, which includes our report dated May 9,
1995 covering the unaudited interim financial information contain therein.
Pursuant to Regulation C of the Securities Act of 1933, that report
is not considered a part of the registration statement prepared or
certified by our firm or a report prepared or certified by our firm within the
meaning of Sections 7 and 11 of the Act.
Very truly yours,
/s/ Arthur Andersen LLP
- ---------------------------------
Arthur Andersen LLP
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS HERETOFORE
AMENDED AND AS AMENDED BY THIS AMENDMENT NO. 4 THERETO HAVE BEEN ASSIGNED TO,
AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF, CHEMICAL BANK, AS
INDENTURE TRUSTEE UNDER A TRUST INDENTURE, MORTGAGE, SECURITY AGREEMENT AND
ASSIGNMENT OF RENTS DATED AS OF DECEMBER 16, 1985, AS AMENDED.
AMENDMENT NO. 4
Dated as of March 8, 1995
to
FACILITY LEASE
Dated as of December 16, 1985, as heretofore amended,
between
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity
but solely as Owner Trustee under
a Trust Agreement dated as of
December 16, 1985 with Public
Service Company of New Mexico,
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
Original Facility Lease recorded December 31, 1985, as Instrument No. 85-
623268, re-recorded April 17, 1986, as Instrument No. 86-187558, confirmed by
document recorded April 25, 1986, as Instrument No. 86-203239, amended by
Amendment No. 1 thereto recorded July 17, 1986, as Instrument No. 86-367462,
amended by Amendment No. 2 thereto recorded on November 25, 1986, as
Instrument No. 86-650739, and amended by Amendment No. 3 thereto recorded on
April 7, 1987, as Instrument No. 87-210926, all in Maricopa County, Arizona
Recorder's Office.
<PAGE>
AMENDMENT NO. 4 dated as of March 8, 1995 (Amendment No. 4) to
the Facility Lease dated as of December 16, 1985, as heretofore amended,
between THE FIRST NATIONAL BANK OF BOSTON, a national banking association,
not in its individual capacity but solely as Owner Trustee under a Trust
Agreement dated as of December 16, 1985 with Public Service Company of New
Mexico (successor by assignment to Burnham Leasing Corporation) (the Lessor),
and PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation (the
Lessee).
W I T N E S S E T H:
WHEREAS, the Lessee and the Lessor have heretofore entered into
a Facility Lease dated as of December 16, 1985, as heretofore amended (the
Facility Lease), providing for the lease by the Lessor to the Lessee of the
Undivided Interest and the Real Property Interest; and
WHEREAS, the Lessee and the Lessor desire to amend the Facility
Lease as set forth in Section 2 hereof;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein or in the recitals shall have the meanings assigned
to such terms in Appendix A to the Facility Lease or in the Note Prepayment
Agreement (as defined in Section 2(a) below), as the case may be.
SECTION 2. Amendments.
(a) Background. On September 2, 1992, the Lessee became the
successor by assignment to the right, title and interest of the original
Owner Participant in and to the Transaction Documents and the Trust Estate.
Public Service Company of New Mexico ("PNM"), both as the Lessee and the
Owner Participant, has determined that, from time to time, it may cause the
prepayment, in whole or in part, of the Notes. PNM, Funding Corp, the Owner
Trustee and FNB (in its capacity as Owner Trustee under the Trust Agreement
dated as of August 12, 1986 with PNM (successor by assignment to the interest
of the original owner participant thereunder)) have entered into the Note
Prepayment Agreement dated as of January 12, 1995 (the "Note Prepayment
Agreement"). Among other things, the Note Prepayment Agreement contemplates
that this Amendment No. 4 and the Unit 1 Indenture Supplement will be
executed and delivered.
(b) Section 3(a)(ii) of the Facility Lease (as most recently
amended by Amendment No. 3 thereto) is hereby amended to read in its entirety
as follows:
"(ii)(1) on July 15, 1986 an amount equal to
4.3683233% of Facility Cost, (2) on July 15, 1987 an
amount equal to 4.70354% of Facility Cost, (3) on
July 15, 1987 and on each Basic Rent Payment Date
thereafter to and including January 15, 1995 an
amount equal to 4.7006080% of Facility Cost, (4) on
July 15, 1995 and on each Basic Rent Payment Date
thereafter to and including January 15, 2015 an
amount equal to the dollar amount specified opposite
such date on Schedule X to Amendment No. 4 dated as
of March 8, 1995 to the Facility Lease and (5) on
(x) July 15, 1995, (y) each Basic Rent Payment Date
thereafter to and including January 15, 2015 and (z)
(in the event that (I) the Owner Participant shall
have elected to cause the Owner Trustee to prepay a
Note in whole or in part in accordance with the
terms thereof or (II) the Owner Participant shall
have elected to cause the Owner Trustee to make a
deposit pursuant to Section 2.3(c) of the Indenture;
the date on which such prepayment or deposit is due
being hereinafter called a "Prepayment Date") on
each Prepayment Date, an amount equal to the
aggregate amount of principal, premium (if any) and
accrued interest to the extent due and payable on
such date on all Notes then outstanding, or the
amount of such deposit, as the case may be;"
(c) Payment of Basic Rent pursuant to Section 3(a)(ii)(5)(z) of
the Facility Lease (as added by this Amendment No. 4) are prepayments of
Basic Rent that would have otherwise been due and payable absent this
Amendment No. 4 and the Note Prepayment Agreement.
(d) Schedules 1, 2 and 3 to the Facility Lease (as most recently
added by Amendment No. 2) are hereby deleted. From and after March 8, 1995,
as of any Basic Rent Payment Date or any other applicable date, Casualty
Value, Special Casualty Value and Termination Value shall equal to the sum of
(i) $10,000,000 and (ii) the unpaid principal amount of the Notes Outstanding
on such date (after giving effect to the payment and application of any Basic
Rent otherwise payable on such date) plus accrued interest.
(e) Section 3(e) of the Facility Lease shall no longer be
applicable to changes in Current Pricing Assumptions.
SECTION 3. Miscellaneous.
(a) Effective Date of Amendments. The amendments set forth in
Section 2 hereof shall be and become effective upon the execution hereof by
the parties hereto.
(b) Counterpart Execution. This Amendment No. 4 may be executed
in any number of counterparts and by each of the parties hereto on separate
counterparts; all such counterparts shall together constitute but one and the
same instrument.
(c) Governing Law. This Amendment No. 4 has been negotiated and
delivered in the State of New York and shall be governed by, and be construed
in accordance with, the laws of the State of New York, except to the extent
that pursuant to the law of the State of Arizona such law is mandatorily
applicable hereto.
(d) Disclosure. Pursuant to Arizona Revised Statutes Section 33-
401, the beneficiary of the Trust Agreement is Public Service Company of New
Mexico, a New Mexico corporation. The address of the beneficiary is Alvarado
Square, Albuquerque, New Mexico 87158, Attention: Treasurer. A copy of the
Trust Agreement is available for inspection at the offices of the Owner
Trustee at Blue Hills Office Park, Mail Stop 45-02-15, 150 Royall Street,
Canton, Massachusetts 02021, Attention of Corporate Trust Division.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 4 to Facility Lease to be duly executed in Boston,
Massachusetts, or Albuquerque, New Mexico, as the case may be, by an officer
thereunto duly authorized.
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity but
solely as Owner Trustee under a
Trust Agreement dated as of December
16, 1985 with Public Service Company
of New Mexico,
By
------------------------------------
Name:
Title:
PUBLIC SERVICE COMPANY OF NEW MEXICO
By
------------------------------------
Treasurer
CONSENT
In accordance with the provisions of the Collateral Trust
Indenture and the Indenture (as such terms are defined in Appendix A to the
within-mentioned Facility Lease) and pursuant to the Consolidated Joint
Officers' Certificate, Company Request, Lessee Request and Notice dated March
8, 1995, the undersigned, in its respective capacities as trustee under each
such indenture, hereby CONSENTS to the foregoing instrument.
CHEMICAL BANK,
as trustee
By:
---------------------------------
Name:
Title:<PAGE>
State of New Mexico )
) ss:
County of Bernallilo )
The foregoing instrument was acknowledged before me this 8th day
of March, 1995, by Mitch Marzec the Treasurer of PUBLIC SERVICE COMPANY OF
NEW MEXICO, a New Mexico corporation, on behalf of the corporation.
-------------------------
Notary Public
Commonwealth of Massachusetts )
) ss:
County of _______________ )
The foregoing instrument was acknowledged before me this 8th day
of March, 1995, by _______________, an _______________ of THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, on behalf of the banking
association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Public Service Company of New Mexico.
---------------------------
Notary Public
<PAGE>
SCHEDULE X to AMENDMENT NO. 4
Equity Portion of Basic Rent
Basic Rent
Payment Date Amount
July 15, 1995 $5,832.74
January 15, 1996 $6,068.99
July 15, 1996 $6,179.61
January 15, 1997 $6,301.49
July 15, 1997 $5,877.49
January 15, 1998 $6,676.49
July 15, 1998 $769,852.99
January 15, 1999 $566,369.99
July 15, 1999 $1,233,225.49
January 15, 2000 $599,283.99
July 15, 2000 $1,303,950.49
January 15, 2001 $633,068.99
July 15, 2001 $1,377,803.99
January 15, 2002 $669,136.99
July 15, 2002 $1,456,146.49
January 15, 2003 $706,796.99
July 15, 2003 $1,538,338.49
January 15, 2004 $746,460.99
July 15, 2004 $1,625,791.99
January 15, 2005 $789,489.49
July 15, 2005 $1,148,815.99
January 15, 2006 $1,191,546.49
July 15, 2006 $1,484,285.49
January 15, 2007 $1,259,260.99
July 15, 2007 $1,567,583.49
January 15, 2008 $1,329,575.99
July 15, 2008 $1,655,790.99
January 15, 2009 $1,404,006.49
July 15, 2009 $1,748,371.49
January 15, 2010 $1,482,067.49
July 15, 2010 $1,819,891.49
January 15, 2011 $6,664.49
July 15, 2011 $6,544.99
January 15, 2012 $6,210.49
July 15, 2012 $6,175.99
January 15, 2013 $3,252,956.49
July 15, 2013 $4,578,897.99
January 15, 2014 $4,578,897.99
July 15, 2014 $4,578,897.99
January 15, 2015 $2,122,897.99
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS HERETOFORE
AMENDED AND AS FURTHER AMENDED BY THIS AMENDMENT NO. 3 THERETO HAVE BEEN
ASSIGNED TO, AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF, CHEMICAL
BANK, AS INDENTURE TRUSTEE UNDER A TRUST INDENTURE, MORTGAGE, SECURITY
AGREEMENT AND ASSIGNMENT OF RENTS DATED AS OF AUGUST 12, 1986, AS HERETOFORE
AMENDED.
AMENDMENT NO. 3
Dated as of March 8, 1995
to
FACILITY LEASE
Dated as of August 12, 1986, as heretofore amended,
between
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity
but solely as Owner Trustee under
a Trust Agreement dated as of
August 12, 1986 with Public
Service Company of New Mexico,
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
Original Facility Lease recorded on August 18, 1986, as Instrument No. 86-
439392, amended by Amendment No. 1 thereto recorded on November 25, 1986, as
Instrument No. 86-650751, and Amendment No. 2 thereto recorded on
December 17, 1986, as Instrument No. 86-695942, all in Maricopa County
Recorder's Office.
<PAGE>
AMENDMENT NO. 3 dated as of March 8, 1995 (Amendment No. 3) to
the Facility Lease dated as of August 12, 1986, as heretofore amended,
between THE FIRST NATIONAL BANK OF BOSTON, a national banking association,
not in its individual capacity but solely as Owner Trustee under a Trust
Agreement dated as of August 12, 1986 with Public Service Company of New
Mexico (successor by assignment to Burnham Leasing Corporation a New York
corporation) (the Lessor), and PUBLIC SERVICE COMPANY OF NEW MEXICO, a New
Mexico corporation (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessee and the Lessor have heretofore entered into
a Facility Lease, dated as of August 12, 1986, as heretofore amended (the
Facility Lease), providing for the lease by the Lessor to the Lessee of the
Undivided Interest and the Real Property Interest; and
WHEREAS, the Lessee and the Lessor desire to amend the Facility
Lease as set forth in Section 2 hereof;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein or in the recitals shall have the meanings assigned
to such terms in Appendix A to the Facility Lease or in the Note Prepayment
Agreement (as defined in Section 2(a) below), as the case may be.
SECTION 2. Amendments.
(a) Background. On September 2, 1992, the Lessee became the
successor by assignment to the right, title and interest of the original
Owner Participant in and to the Transaction Documents and the Trust Estate.
Public Service Company of New Mexico ("PNM"), both as the Lessee and the
Owner Participant, has determined that, from time to time, it may cause the
prepayment, in whole or in part, of the Notes. PNM, Funding Corp, the Owner
Trustee and FNB (in its capacity as Owner Trustee under the Trust Agreement
dated as of December 16, 1985 with PNM (successor by assignment to the
interest of the original owner participant thereunder)) have entered into the
Note Prepayment Agreement dated as of January 12, 1995 (the "Note Prepayment
Agreement"). Among other things, the Note Prepayment Agreement contemplates
that this Amendment No. 3 and the Unit 1 Indenture Supplement will be
executed and delivered.
(b) Section 3(a)(ii) of the Facility Lease (as most recently
amended by Amendment No. 2 thereto) is hereby amended to read in its entirety
as follows:
"(ii)(1) on January 15, 1987 and on each Basic Rent
Payment Date thereafter to and including January 15,
1995 an amount equal to 4.4195613% of Facility Cost,
(2) on July 15, 1995 and on each Basic Rent Payment
Date thereafter to and including January 15, 2016 an
amount equal to the dollar amount specified opposite
such date on Schedule X to Amendment No. 3 dated as
of March 8, 1995 to the Facility Lease and (3) on
(x) July 15, 1995, (y) each Basic Rent Payment Date
thereafter to and including January 15, 2012 and (z)
(in the event that (I) the Owner Participant shall
have elected to cause the Owner Trustee to prepay a
Note in whole or in part in accordance with the
terms thereof or (II) the Owner Participant shall
have elected to cause the Owner Trustee to make a
deposit pursuant to Section 2.3(c) of the Indenture;
the date on which such prepayment or deposit is due
being hereinafter called a "Prepayment Date") on
each Prepayment Date, an amount equal to the
aggregate amount of principal, premium (if any) and
accrued interest to the extent due and payable on
such date on all Notes then outstanding, or the
amount of such deposit, as the case may be;"
(c) Payments of Basic Rent pursuant to Section 3(a)(ii)(3)(z) of
the Facility Lease (as added by this Amendment No. 3) are prepayments of
Basic Rent that would have otherwise been due and payable absent this
Amendment No. 3 and the Note Prepayment Agreement.
(d) Schedules 1, 2 and 3 to the Facility Lease (as most recently
added by Amendment No. 1) are hereby deleted. From and after March 8, 1995,
as of any Basic Rent Payment Date or any other applicable date, Casualty
Value, Special Casualty Value and Termination Value shall equal the sum of
(i) $10,000,000 and (ii) the unpaid principal amount of the Notes Outstanding
on such date (after giving effect to the payment and application of any Basic
Rent otherwise payable on such date) plus accrued interest.
(e) Section 3(e) of the Facility Lease shall no longer be
applicable to changes in Current Pricing Assumptions.
SECTION 3. Miscellaneous.
(a) Effective Date of Amendments. The amendments set forth in
Section 2 hereof shall be and become effective upon the execution hereof by
the parties hereto.
(b) Counterpart Execution. This Amendment No. 3 may be executed
in any number of counterparts and by each of the parties hereto on separate
counterparts; all such counterparts shall together constitute but one and the
same instrument.
(c) Governing Law. This Amendment No. 3 has been negotiated and
delivered in the State of New York and shall be governed by, and construed in
accordance with, the laws of the State of New York, except to the extent that
pursuant to the law of the State of Arizona such law is mandatorily
applicable hereto.
(d) Disclosure. Pursuant to Arizona Revised Statutes Section 33-
401, the beneficiary of the Trust Agreement is Public Service Company of New
Mexico, a New Mexico corporation. The address of the beneficiary is Alvarado
Square, Albuquerque, New Mexico 87158, Attention: Treasurer. A copy of the
Trust Agreement is available for inspection at the offices of the Owner
Trustee at Blue Hills Office Park, Mail Stop 45-02-15, 150 Royall Street,
Canton, Massachusetts 02021, Attention of Corporation Trust Division.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 3 to Facility Lease to be duly executed in New York, New York
by an officer thereunto duly authorized.
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity but
solely as Owner Trustee under a
Trust Agreement dated as of August
12, 1986 with Public Service
Company of New Mexico,
By
----------------------------------
Name:
Title:
PUBLIC SERVICE COMPANY OF
NEW MEXICO
By
---------------------------------
Mitchell J. Marzec
Treasurer
CONSENT
In accordance with the provisions of the Collateral Trust
Indenture and the Indenture (as such terms are defined in Appendix A to the
within-mentioned Facility Lease) and pursuant to the Consolidated Joint
Officers' Certificate, Company Request, Lessee Request and Notice dated
March 8, 1995, the undersigned, in its respective capacities as trustee under
each such indenture, hereby CONSENTS to the foregoing instrument.
CHEMICAL BANK,
as trustee
By:
----------------------------
Name:
Title:<PAGE>
State of New Mexico )
) ss:
County of Bernallilo )
The foregoing instrument was acknowledged before me this 8th day
of March, 1995 by M.J. Marzec the Treasurer of PUBLIC SERVICE COMPANY OF NEW
MEXICO, a New Mexico corporation, on behalf of the corporation.
---------------------------
Notary Public
Commonwealth of Massachusetts )
) ss:
County of _______________ )
The foregoing instrument was acknowledged before me this 8th day
of March, 1995 by _______________, an _______________ of THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, on behalf of the banking
association as trustee under that certain Trust Agreement dated as of August
12, 1986 with Public Service Company of New Mexico.
--------------------------
Notary Public
<PAGE>
SCHEDULE X TO AMENDMENT NO. 3
Equity Portion of Basic Rent
Basic Rent
Payment Date Amount
July 15, 1995 $383.55
January 15, 1996 $861.55
July 15, 1996 $577.05
January 15, 1997 $664.30
July 15, 1997 $212.80
January 15, 1998 $420.80
July 15, 1998 $201,079.80
January 15, 1999 $339,192.05
July 15, 1999 $748,599.55
January 15, 2000 $363,346.05
July 15, 2000 $800,864.30
January 15, 2001 $388,503.55
July 15, 2001 $855,437.05
January 15, 2002 $415,222.80
July 15, 2002 $913,876.05
January 15, 2003 $443,011.30
July 15, 2003 $976,739.55
January 15, 2004 $473,427.30
July 15, 2004 $1,043,535.05
January 15, 2005 $506,029.05
July 15, 2005 $1,114,871.55
January 15, 2006 $377,425.55
July 15, 2006 $970,681.05
January 15, 2007 $830,170.55
July 15, 2007 $1,038,875.80
January 15, 2008 $845,643.30
July 15, 2008 $570.05
January 15, 2009 $455.55
July 15, 2009 $852.05
January 15, 2010 $114.80
July 15, 2010 $700.55
January 15, 2011 $964.55
July 15, 2011 $363.55
January 15, 2012 $405.05
July 15, 2012 $2,576,545.80
January 15, 2013 $4,419,561.30
July 15, 2013 $4,419,561.30
January 15, 2014 $4,419,561.30
July 15, 2014 $4,419,561.30
January 15, 2015 $4,419,561.30
July 15, 2015 $4,419,561.30
January 15, 2016 $4,419,561.30
RESULTS PAY
Results Pay is a broad-based results oriented compensation program designed
to tie a portion of the cash rewards awarded employees to the success of
their business unit and the success of the Company. As an important new
element in PNM's total compensation program, Results Pay is timely as the
Company prepares for increasing competition. A key aspect of this
preparation is a change in corporate culture to greater employee
involvement and ownership in their jobs. Results Pay supports the new
culture by reinforcing the idea that all employees are responsible for
making the Company succeed.
The award pool for Results Pay is created when the Company exceeds its
basic objectives for financial performance. Employees earn an award based
on results in their unit and the Company's financial results. Total award
potential ranges from 5% for the workforce to 15% for key managers, 20% for
vice-presidents and 25% for senior vice-presidents. The CEO does not
participate in this plan.
Awards at the work force level are based 75% on unit results and 25% on
Company results. This is also the case for key managers. For vice-
presidents, 60% of their awards are based on unit results and 40% on
Company results. For senior vice-presidents, the ratio is 33% unit, 67%
Company to recognize the need for them to work as a team to achieve Company
goals.
For 1995, Company results will be measured by Earnings Per Share (EPS) from
continuing operations. The target will vary from year to year. If the EPS
threshold is not attained, no awards will be paid out, and the target level
must also be maintained after all awards are paid.
Awards for business unit results depend on the amount of money in the unit
pool, and whether unit goals have been met. Unit goals are generally
centered on cost control, customer satisfaction and efficiency in
operations.
In the future, Results Pay will enable the Company to slow down its growth
in base pay. It will also enable the Company to put more of management's
pay at risk while serving as the only annual incentive-type plan for that
group. In summary, Results Pay allows the Company the flexibility to
reward employees in accordance with the results of the business.
FIRST PV FUNDING CORPORATION,
PUBLIC SERVICE COMPANY OF NEW MEXICO
and
CHEMICAL BANK,
as Trustee
1995 SUPPLEMENTAL INDENTURE
dated as of February 14, 1995
to
COLLATERAL TRUST INDENTURE
dated as of December 16, 1985
Making Provision for Certain Amendments
to the Indenture Which Shall Become
Effective As Provided Herein
PALO VERDE NUCLEAR GENERATING STATION
<PAGE>
1995 SUPPLEMENTAL INDENTURE dated as of February 14, 1995 among
FIRST PV FUNDING CORPORATION, a Delaware corporation (the Company), PUBLIC
SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation (PNM), and CHEMICAL
BANK, a New York banking corporation, as trustee (the Trustee).
WHEREAS, the Company and PNM have heretofore executed and
delivered to the Trustee an indenture dated as of December 16, 1985 (the
Original Indenture) to provide for the issue from time to time of the
Company's debentures, notes or other evidences of indebtedness to be issued
in one or more series (the Securities);
WHEREAS, Section 11.01 of the Original Indenture provides, among
other things, that PNM, the Company and the Trustee may enter into indentures
supplemental to the Original Indenture for, among other things, the purpose
of establishing the form and terms of Securities of any series as permitted
by Sections 2.01 and 2.03 of the Original Indenture;
WHEREAS, PNM and the Company heretofore executed and delivered
the Series 1986A Bond Supplemental Indenture dated as of July 15, 1986 (the
Series 1986A Supplement) to the Trustee, and the Company issued thereunder a
series of Securities designated "Lease Obligation Bonds Series 1986A" (the
1986A Bonds) in the original aggregate principal amount of $253,677,000;
WHEREAS, PNM and the Company heretofore executed and delivered
the Series 1986B Bond Supplemental Indenture dated as of November 18, 1986
(the Series 1986B Supplement) to the Trustee, and the Company issued
thereunder a series of Securities designated "Lease Obligation Bonds, Series
1986B" (the 1986B Bonds) in the original aggregate principal amount of
$460,000,000;
WHEREAS, on January 16, 1995 (after giving effect to the Sinking
Fund payments in respect of the 1986A Bonds and the 1986B Bonds scheduled to
be made on such date) $201,922,000 of the Series 1986A Bonds and $413,011,000
of the Series 1986B Bonds were the only Securities Outstanding under the
Original Indenture as heretofore supplemented and amended (the Original
Indenture, as heretofore supplemented and amended and as amended by this 1995
Supplemental Indenture, being hereinafter called the Indenture);
WHEREAS, Section 11.02 of the Original Indenture provides that
the Company and the Trustee may, with the consent of PNM and the Holders of
not less than a majority in principal amount of the Outstanding Securities,
enter into an indenture supplemental to the Original Indenture for the
purpose of changing the rights and obligations of the Holders of Securities
and of PNM and the Company under the Indenture;
WHEREAS, the Company desires to make the amendments to Article
Six of the Indenture set forth in Section 1.01 of this 1995 Supplemental
Indenture to be effective upon the delivery by the Company and PNM to the
Trustee of Acts of the Holders of not less than a majority in principal
amount of the Outstanding Securities consenting to this 1995 Supplemental
Indenture;
WHEREAS, the Company and PNM have determined that such amendments
to Article Six of the Indenture are not within any of clauses (1) through (4)
of the proviso to Section 11.02 of the Original Indenture;
<PAGE>
WHEREAS, all acts and things necessary to constitute these
presents a valid and binding supplemental indenture and agreement according
to its terms have been done and performed, and the execution of this 1995
Supplemental Indenture has in all respects been duly authorized, and the
Company and PNM, in the exercise of legal right and power in them vested,
execute this 1995 Supplemental Indenture; and
WHEREAS, the conditions to the effectiveness specified in Section
1.02(a) thereto having not been satisfied, it is the intent of the parties
that the 1995 Supplemental Indenture dated as of January 5, 1995 (the Prior
1995 Supplement) among the Company, PNM and the Trustee be superseded in its
entirety by this 1995 Supplement:
NOW, THEREFORE, THIS 1995 SUPPLEMENTAL INDENTURE WITNESSETH:
ARTICLE ONE
AMENDMENT TO ORIGINAL INDENTURE
WITH CONSENT
SECTION 1.01. Optional Redemption in Certain Circumstances.
(a) PNM has become the assignee of the Equity Investor in respect
of the beneficial interests in two Lessors (each a "DBL Lessor"): (x) Owner
Trustee No. 2 (as identified on Schedule 2 to each of the Series 1986A
Supplement and the Series 1986B Supplement) and (y) Owner Trustee No. 6 (as
identified on Schedule 2 to the Series 1986B Supplement). In the event that
(i) PNM shall have determined to cause a prepayment in whole or in part of
the principal, interest and premium (if any) due in respect of the Pledged
Lessor Notes issued under and secured by each Lease Indenture to which a DBL
Lessor is party and (ii) PNM shall have determined that the provisions of
this Section 1.01(a) shall be applicable to Securities held by a Consenting
Holder (as defined in paragraph (c) of this Section 1.01), Securities (held
by such Consenting Holder) of a tenor equivalent to, and in an aggregate
principal amount up to the aggregate principal amount of, the Affected Bonds
(as defined in paragraph (b) of this Section 1.01) with respect to such DBL
Lessor may be redeemed at the option of the Company in accordance with the
provisions relating to optional redemptions otherwise applicable to such
Securities (in each case, as set forth in the Indenture and the Series
Supplemental Indentures applicable to such Securities), except as such
provisions have been changed by the provisions of this Section 1.01. This
Section 1.01 shall not be applicable to any Lessor other than a DBL Lessor.
(b) With respect to each DBL Lessor and the Lease Indenture to
which it is party, the term Affected Bonds shall have the meaning specified
in the applicable subparagraph of this Section 1.01(b):
(i) with respect to the Lease Indenture to which Owner Trustee No. 2
(as identified on Schedule 2 to each of the Series 1986A Supplement and
the Series 1986B Supplement) is a party, Affected Bonds are: (1) 1986A
Bonds with a Stated Maturity of principal of July 15, 1996 in a
principal amount equal to the unamortized principal amount of such
Owner Trustee's Non-Recourse Promissory Note, Fixed Rate Series (Due
July 15, 1996) in the original principal amount of $12,496,000 (item
2(v) on Schedule 2 to the Series 1986A Supplement); (2) 1986A Bonds
with a Stated Maturity of principal of January 15, 2014 in a principal
amount equal to the unamortized principal amount of such Owner
Trustee's Non-Recourse Promissory Note, Fixed Rate Series (Due January
15, 2013) in the original principal amount of $58,031,000 (item 2(vi)
on Schedule 2 to the Series 1986A Supplement); and (3) 1986B Bonds with
a Stated Maturity of principal of January 15, 2016 in a principal
amount equal to the unamortized principal amount of such Owner
Trustee's Non-Recourse Promissory Note, Releveraging Series (Due
January 15, 2015) in the original principal amount of $2,456,000 (item
2(ii) on Schedule 2 to the Series 1986B Supplement); and
(ii) with respect to the Lease Indenture to which Owner Trustee No. 6
(as identified on Schedule 2 to the Series 1986B Supplement) is a
party, Affected Bonds are: (1) 1986B Bonds with a Stated Maturity of
principal of January 15, 1997 in a principal amount equal to the
unamortized principal amount of such Owner Trustee's Non-Recourse
Promissory Note, Fixed Rate Series (Due January 15, 1997) in the
original principal amount of $10,645,000 (item 2(xi) on Schedule 2 to
the Series 1986B Supplement); and (2) 1986B Bonds with a Stated
Maturity of principal of January 15, 2016 in a principal amount equal
to the unamortized principal amount of such Owner Trustee's
Non-Recourse Promissory Note, Fixed Rate Series (Due July 15, 2012) in
the original principal amount of $60,598,000 (item 2(xii) on Schedule
2 to the Series 1986B Supplement).
(c) Consenting Holder means (i) PNM, (ii) the Company or (iii)
an Affiliate of PNM or any other Person who, with the written consent of PNM,
shall have elected in writing to have all or any portion of the Securities
held by such Person become subject to optional redemption in accordance with
Section 1.01(a).
(d) With respect to an optional redemption of Securities pursuant
to Section 1.01(a), upon delivery to the Trustee of an Officers' Certificate
of PNM and the Company to the effect:
(1) that PNM has become the assignee of the Equity Investor
in respect of a DBL Lessor (such Officer's Certificate shall
specifically identify (i) the Participation Agreement and owner
trust agreement to which such Equity Investor is party and (ii)
the Extension Letter, Lease Indenture (the Affected Indenture)
and Lease executed in connection with the transaction
contemplated by such Participation Agreement);
(2) that PNM has determined to cause an optional
prepayment, in whole or in part, of one or more Pledged Lessor
Notes outstanding under the Affected Indenture on the date
specified in such certificate;
(3)(A) if all the Pledged Lessor Notes outstanding under an
Affected Indenture are to be prepaid, that (i) there is
identified on a schedule to such certificate (the Securities
Schedule) particular Securities which are held by one or more
Consenting Holders and (ii) the Securities so identified are of
the series and Stated Maturities of principal and are of the
requisite amounts so as to constitute all of the Affected Bonds
with respect to the Affected Indenture; or
(B) if less than all the Pledged Lessor Notes
outstanding under an Affected Indenture are to be prepaid, that
(i) there is identified on the Securities Schedule particular
Securities which are held by one or more Consenting Holders, (ii)
there is identified all Pledged Lessor Notes then outstanding
under the Affected Indenture and the portion of the then
outstanding principal amount of each such Pledged Lessor Note
which is to be optionally prepaid and, (iii) after giving effect
to the proposed optional redemption of Securities and the
proposed prepayment of such Pledged Lessor Notes, the remaining
Affected Bonds with respect to the Affected Indenture will
correspond as to principal amount and interest rate to the
remaining Pledged Lessor Notes outstanding under the Affected
Indenture;
(4) in the event that the Securities Schedule specifies one
or more Consenting Holders which are not PNM or the Company, that
accompanying such Securities Schedule is the irrevocable written
election by each such Consenting Holder to make the identified
Securities held by such Person (or specified portions thereof)
subject to optional redemption pursuant to Section 1.01(a) of
this 1995 Supplemental Indenture;
(5) that PNM has determined that Section 1.01(a) shall be
applicable to the Securities identified on the Securities
Schedule;
(6) that the Company has determined to effect an optional
redemption of Securities in the amounts, series and Stated
Maturities of principal specified in such certificate (which
amounts, series and Stated Maturities of principal shall be
equal, in the aggregate, to the amounts, series and Stated
Maturities of principal of Securities specified on the Securities
Schedule);
(7) the date on which (i) the Pledged Lessor Notes are to
be prepaid as contemplated by this Section 1.01(d) and (ii) the
optional redemption contemplated by Section 1.01(a) shall occur
(both such dates shall be the same);
(8) that (i) there is no Event of Default under the
Indenture, (ii) neither PNM nor the Company has received a
"Notice of Default" in respect of the Indenture and (iii) neither
PNM nor the Company has knowledge of an "Indenture Event of
Default" under any Lease Indenture; and
(9) that accompanying such Officers' Certificate is the
Company Request contemplated by Section 7.01(c) of the Indenture
(in the event that the Securities identified on the Securities
Schedule include 1986A Bonds), Section 1.04(d) of the Series
1986B Supplement (in the event that the Securities identified on
the Securities Schedule include 1986B Bonds) and any comparable
provision of any subsequent Series Supplemental Indenture;
Securities in the amounts, series and Stated Maturities of principal
specified in such certificate (as contemplated by clause (6) of this Section
1.01(d)) held by PNM, the Company or one or more other Consenting Holders (as
identified on the applicable Securities Schedule) shall be redeemed on the
Redemption Date specified in such certificate; provided, that the Trustee
shall have received aggregate proceeds from the prepayment of the Pledged
Lessor Notes in question (including premium (if any) and accrued interest
thereon through the date of prepayment) sufficient to pay the aggregate
Redemption Price of the Securities to be redeemed (including, but without
limitation, any premium payable as provided in the applicable Series
Supplemental Indenture upon a redemption at the option of the Company).
Section 6.02 of the Indenture to the contrary notwithstanding, the particular
Securities of a series and Stated Maturity of principal to be redeemed shall
be the Securities of such series and Stated Maturity of principal as are
specified on the Securities Schedule to the Officers' Certificate described
in this Section 1.01(d).
(e) Section 6.03 of the Original Indenture shall not be
applicable to optional redemptions pursuant to this Section 1.01.
(f) Section 6.04 of the Original Indenture to the contrary
notwithstanding, deposits of redemption monies in respect of optional
redemptions pursuant to Section 1.01(a) may be made on the Redemption Date.
(g) Anything in clause (ii), (iii) or (iv) in Section 5.08 of the
Indenture to the contrary notwithstanding, the Company may act as a
Consenting Holder and, in connection therewith, enter into transactions
(including, but without limitation, tender offers and other Securities
purchases) which, in the judgment of the Company (as evidenced by a Board
Resolution), are appropriate to facilitate an optional redemption pursuant to
this Section 1.01, provided such transactions, either singly or in the
aggregate, do not materially adversely affect the interests of Holders of the
Securities. There shall be excluded from the Pledged Property and the Lien
of the Indenture (i) any moneys or other property advanced or provided to the
Company which shall not otherwise constitute Pledged Property and (ii) any
moneys received by the Company in payment of the Redemption Price of
Securities in respect of which the Company is Holder.
(h) Anything in Section 3.03 of the Indenture to the contrary
notwithstanding, the Trustee is authorized and directed (without necessity
for directions from, consent of or other action by Securityholders) to vote
the Pledged Lessor Notes issued under a Lease Indenture (i) in order to amend
such Lease Indenture to shorten or eliminate the period of prior notice for
prepayments of such Pledged Lessor Notes and to make such notice conditional
on receipt of sufficient funds to make such prepayment and (ii) as required
to implement or make effective the Trustee's consent pursuant to Section 5.09
to any change in any Principal Instrument which may be given by the Trustee
without the consent of the Holders of any Outstanding Securities.
SECTION 1.02. Effectiveness.
(a) The amendments to the Original Indenture specified in Section
1.01 shall become effective for all purposes of the Indenture upon (1) the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities, by Act or Acts of said Holders delivered to the
Company and the Trustee and (2) receipt by the Trustee of an Opinion of
Counsel to the effect that, assuming the due authorization, execution and
delivery thereof, such Act or Acts are valid and effective for all purposes
of this Indenture, the laws of the State of New York and Federal law.
(b) Upon the effectiveness of the amendments to the Original
Indenture specified in Section 1.01, the Original Indenture shall, as
provided in Section 11.05 thereof, be modified accordingly and such
amendments shall form a part of the Indenture for all purposes and every
Holder of Securities shall be bound thereby.
<PAGE>
ARTICLE TWO
MISCELLANEOUS
SECTION 2.01. Execution as Supplemental Indenture; Definitions;
etc.
(a) This 1995 Supplemental Indenture is executed and shall be
construed as an indenture supplemental to the Original Indenture and, as
provided in the Original Indenture, this 1995 Supplemental Indenture forms a
part thereof. Except as herein expressly otherwise defined, the use of the
terms herein is in accordance with the definitions contained in the Original
Indenture.
(b) The Prior 1995 Supplement is hereby cancelled and nullified
and shall have no further force or effect.
SECTION 2.02. Responsibility for Recitals, etc.
The recitals contained herein shall be taken as the statements of
the Company and PNM, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representation as to the
validity or sufficiency of this 1995 Supplemental Indenture.
SECTION 2.03. Provisions Binding on Successors.
All the covenants, stipulations, promises and agreements in this
1995 Supplemental Indenture contained by or on behalf of the Company or PNM
shall bind its successors and assigns, whether so expressed or not.
SECTION 2.04. New York Contract.
This 1995 Supplemental Indenture shall be deemed to be a contract
under the laws of the State of New York, and for all purposes shall be
governed by and construed in accordance with the laws of said state.
SECTION 2.05. Counterparts.
This 1995 Supplemental Indenture may be executed in any number of
counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
SECTION 2.06. Certain Ministerial Provisions Relating to
Optional Redemptions under Section 1.01 of the 1995 Supplemental Indenture.
(a) Where any Consenting Holder shall be the transferee of any
Securities, Chemical Bank, as Security Registrar, acknowledges that it shall
use its best efforts to register the transfer(s) in question during the
period through and including any Redemption Date selected in accordance with
Section 1.01 of this 1995 Supplemental Indenture, provided that such transfer
within such period is reasonably practicable.
(b) The Trustee agrees that, in connection with a Redemption Date
selected in accordance with Section 1.01 of this 1995 Supplemental Indenture,
notice pursuant to Section 6.01 of the Original Indenture may be delivered by
the Company on the Redemption Date in question (provided that all Securities
specified in the Officers' Certificate delivered pursuant to Section 1.01
shall have been registered in the name of a Consenting Holder).
(c) In the event that (i) the Securities designated in a
Securities Schedule accompanying an Officers' Certificate delivered pursuant
to Section 1.01 (a Section 1.01 Certificate) are registered in the name of a
security depositary, a clearing corporation or agency or nominee and (ii) a
Responsible Officer of the Trustee has knowledge that the Holder in question
customarily acts only as a security depositary, a clearing corporation or
agency or nominee, then the Trustee may accept such Section 1.01 Certificate
with such modifications thereto (including, but without limitation, being
accompanied by a security position listing from such depositary, clearing
corporation, agency or nominee) as may be appropriate, in PNM's judgment, to
reflect the circumstances of the manner in which a Consenting Holder holds
beneficial (but not record) ownership of the Securities in question;
provided, however, that, if the Trustee determines that a proposed
modification affects any interest, right, duty, immunity and indemnity in
favor of the Trustee under the Indenture, the Trustee may in its discretion
decline to accept such modifications.
<PAGE>
IN WITNESS WHEREOF, the Company, PNM and the Trustee have caused
this 1995 Supplemental Indenture to be duly executed by their respective
officers thereunto duly authorized, as of the date and year first above
written.
FIRST PV FUNDING CORPORATION
[CORPORATE SEAL]
By
------------------------------
M.A. Ferrucci
President
Attest:
- -----------------------
Assistant Secretary
PUBLIC SERVICE COMPANY
OF NEW MEXICO
[CORPORATE SEAL]
By
------------------------------
Mitchell J. Marzec
Treasurer
Attest:
- ----------------------
Assistant Secretary
CHEMICAL BANK,
as Trustee
[CORPORATE SEAL]
By
----------------------------
T.J. Foley
Vice President
Attest:
- ----------------------
Senior Trust Officer<PAGE>
STATE OF DELAWARE )
) : ss.:
COUNTY OF NEW CASTLE )
On this day of March, 1995, before me personally came M.A.
Ferrucci, to me known, who, being by me duly sworn, did depose and say that
he resides at Wilmington, Delaware; that he is the President of FIRST PV
FUNDING CORPORATION, one of the corporations described in and which executed
the foregoing instrument; that he knows the seal of said corporation; that
the seal affixed to said instrument is such corporate seal; that it was so
affixed by authority of the Board of Directors of said corporation, and that
he signed his name thereto by like authority.
[NOTARIAL SEAL]
--------------------------- <PAGE>
STATE OF NEW MEXICO )
) : ss.:
COUNTY OF BERNALILLO )
On this day of March, 1995 before me personally came M.J.
Marzec, to me known, who, being by me duly sworn, did depose and say that he
resides at Albuquerque, New Mexico; that he is the Treasurer of PUBLIC
SERVICE COMPANY OF NEW MEXICO, one of the corporations described in and which
executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
[NOTARIAL SEAL]
-------------------------- <PAGE>
STATE OF NEW YORK )
) : ss.:
COUNTY OF NEW YORK )
On this day of March, 1995, before me personally came T. J.
Foley, to me known, who, being by me duly sworn, did depose and say that he
resides at Bethpage, New York; that he is, a Vice President of CHEMICAL BANK,
one of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the seal affixed
to said instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation, and that he signed
his name thereto by like authority.
[NOTARIAL SEAL]
------------------------
SUPPLEMENTAL INDENTURE NO. 3
Dated as of March 8, 1995
To
TRUST INDENTURE, MORTGAGE, SECURITY AGREEMENT AND
ASSIGNMENT OF RENTS
Dated as of December 16, 1985, as heretofore supplemented
between
THE FIRST NATIONAL BANK OF BOSTON, not
in its individual capacity but solely
as Owner Trustee under a Trust
Agreement dated as of December 16,
1985 with Public Service
Company of New Mexico
and
CHEMICAL BANK,
as Indenture Trustee
Original Indenture recorded December 31, 1985, as Instrument No. 85-623270,
re-recorded April 17, 1986, as Instrument No. 86-187559, and confirmed
by document recorded April 25, 1986, as Instrument No. 86-203241,
and Supplemental Indenture No. 1 thereto, dated as of July 15, 1986,
recorded July 17, 1986 as Instrument No. 86-367465, and Supplemental
Indenture No. 2 thereto, dated as of November 18, 1986, recorded
November 25, 1986 as Instrument No. 86-650741, all in Maricopa
County, Arizona Recorder's Office
<PAGE>
SUPPLEMENTAL INDENTURE No. 3 dated as of March 8, 1995 to Trust
Indenture, Mortgage, Security Agreement and Assignment Of Rents dated as of
December 16, 1985, between THE FIRST NATIONAL BANK OF BOSTON, a national
banking association (FNB), not in its individual capacity, but solely as
Owner Trustee (the Owner Trustee) under a Trust Agreement dated as of
December 16, 1985, between FNB, whose address is Blue Hills Office Park, Mail
Stop 45-02-15, 150 Royall Street, Canton, Massachusetts 02021, with Public
Service Company of New Mexico, a New Mexico corporation (successor by
assignment to the interest originally held by Burnham Leasing Corporation, a
New York corporation), and CHEMICAL BANK, a New York banking corporation (the
Indenture Trustee), whose address is 450 West 33rd Street, New York, New York
10001, Attention Corporate Trustee Administration Department.
W I T N E S S E T H:
WHEREAS, the Owner Trustee and the Indenture Trustee have entered
into a Trust Indenture, Mortgage, Security Agreement and Assignment of Rents
dated as of December 16, 1985 (as heretofore supplemented and amended, the
Indenture);
WHEREAS, the Owner Trustee and the Indenture Trustee desire to
amend the Indenture as set forth in Section 2 hereof;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in
Appendix A to the Indenture.
SECTION 2. Amendments.
(a) Background. On September 2, 1992, the Lessee became the
successor by assignment to the right, title and interest of the original
Owner Participant in and to the Transaction Documents and the Trust Estate.
Public Service Company of New Mexico ("PNM"), both as Lessee and Owner
Participant, has determined that, from time to time, it may cause the
prepayment, in whole or in part, of the Notes Outstanding under the
Indenture. PNM, Funding Corp, the Owner Trustee and FNB (in its capacity as
Owner Trustee under the Trust Agreement dated as of August 12, 1986 with PNM
(as successor by assignment to the original owner participant thereunder))
have entered into a Note Prepayment Agreement dated as of January 12, 1995
(the "Note Prepayment Agreement"). Among other things, the Note Prepayment
Agreement contemplates that this Supplemental Indenture No. 3 will be
executed and delivered.
(b) Amendment to Section 3.8. The requirement of Section 3.8 of
the Indenture that final payment of a Note be made only against surrender of
such Note is hereby deleted.
(c) Amendment to Section 3.9(a). The following sentence is
added at the end of Section 3.9(a):
"In the event that (in accordance with the applicable provisions
of a Note) the Owner Trustee determines to prepay a Note in part,
the Owner Trustee may apply the principal portion of such
prepayment to prepay such remaining installments of principal in
such amounts as the Owner Trustee shall identify in its notice of
prepayment (such notice of prepayment to be accompanied by an
appropriately prepared replacement Schedule I to the Note being
prepaid)."
(d) Amendment to Section 3.9(c). Anything in Section 3.9(c) of
the Indenture and any provision of any Note to the contrary notwithstanding,
in the event of a prepayment of a Note, prior notice of such prepayment need
not be given if the same institution is both the Indenture Trustee and the
holder, assignee and pledgee of the Note to be prepaid.
(e) Amendment to Section 4.3. Anything in Section 4.3 of the
Indenture to the contrary, at the request of the Owner Trustee, the Indenture
Trustee shall not destroy cancelled Notes but shall return the same marked
"CANCELLED" to the Owner Trustee.
(f) Amendment to Section 5.1. Clause first of Section 5.1 is
hereby amended and restated in its entirety as follows:
"first, so much of such payment as shall be required
to pay in full the aggregate amount of the payment
or payments of principal and/or premium and/or
interest (as well as any interest on overdue
principal or, to the extent permitted by law,
interest) then due and unpaid on all Notes (whether
a scheduled installment of principal and interest or
amounts due in respect of principal, premium and
accrued interest in the event that the Owner Trustee
shall exercise its prepayment option in whole or in
part) shall be distributed to the Holders of the
Notes ratably, without priority of one over the
other, in the proportion that the aggregate amount
of such payment or payments then due and unpaid on
all Notes held by each such Holder on such date
bears to the aggregate amount of such payment or
payments then due and unpaid on all Notes
Outstanding on such date, without priority of
principal, premium or interest over any of them;"
SECTION 3. Miscellaneous.
(a) Effective Date of Supplemental Indenture.
This Supplemental Indenture No. 3 shall be and become effective
upon the execution hereof by the parties hereto.
(b) Counterpart Execution.
This Supplemental Indenture No. 3 may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which, when so executed and delivered, shall be an original, but all
such counterparts shall together constitute but one and the same instrument.
(c) Execution as Supplemental Indenture.
This Supplemental Indenture No. 3 is executed and shall be
construed as an indenture supplemental to the Indenture and, as provided in
the Indenture, this Supplemental Indenture No. 3 forms a part thereof.
(d) Disclosure.
Pursuant to Arizona Revised Statutes Section 33-401, the
beneficiary of the Trust Agreement is Public Service Company of New Mexico,
a New Mexico corporation. The address of the beneficiary is Alvarado Square,
Albuquerque, New Mexico 87158, Attention: Treasurer. A copy of the Trust
Agreement is available for inspection at the offices of the Owner Trustee at
Blue Hills Office Park, Mail Stop 45-02-15, 150 Royall Street, Canton,
Massachusetts 02021, Attention of Corporate Trust Division.
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee and the Indenture Trustee
have each caused this Supplemental Indenture No. 3 to be duly executed by
their respective officers thereunto duly authorized, all as of the date first
set forth above.
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual
capacity, but solely as Owner
Trustee under the Trust
Agreement dated as of December
16, 1985, with Public Service
Company of New Mexico
By
-------------------------
Name:
Title:
CHEMICAL BANK,
By
-------------------------
Vice President
CONSENT AND DIRECTIVE
The undersigned, as trustee under the Collateral Trust Indenture
(as defined in Appendix A to the within-mentioned Indenture), is the assignee
and pledgee of First PV Funding Corporation in respect of the Notes which are
presently outstanding under the Indenture being supplemented by the foregoing
instrument. In accordance with the provisions of such Collateral Trust
Indenture (as amended by the 1995 Supplement thereto dated as of February 14,
1995) and pursuant to the Consolidated Joint Officers' Certificate, Company
Request, Lessee Request and Notice dated March 8, 1995, the undersigned, as
such assignee and pledgee, and as holder of all of the Notes outstanding
under the Indenture, hereby CONSENTS to the foregoing instrument and DIRECTS
the Indenture Trustee to execute and deliver the same.
CHEMICAL BANK, as
Collateral Trust Trustee
By:
-------------------------
Name:
Title:
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 8th day of March, 1995, before me personally came
, to me known, who, being by me duly sworn, did acknowledge, depose
and say that he resides at , Massachusetts; that he is an
of THE FIRST NATIONAL BANK OF BOSTON, a national banking
association, described in and which executed the foregoing instrument; and
that he signed his name thereto on behalf of said association by authority of
the Board of Directors of such association.
------------------------------
Notary Public
[NOTARIAL SEAL] Term Expires:
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 8th day of March, 1995, before me personally came
, to me known, who, being by me duly sworn, did acknowledge, depose
and say that he resides at , ; that he is a Vice
President of CHEMICAL BANK, a New York banking corporation, described in and
which executed the foregoing instrument; and that he signed his name thereto
on behalf of said corporation by authority of the Board of Directors of such
corporation.
------------------------------
Notary Public
[NOTARIAL SEAL] Term Expires:
SUPPLEMENTAL INDENTURE NO. 2
Dated as of March 8, 1995
To
TRUST INDENTURE, MORTGAGE, SECURITY AGREEMENT AND
ASSIGNMENT OF RENTS
Dated as of August 12, 1986
between
THE FIRST NATIONAL BANK OF BOSTON, not
in its individual capacity but solely
as Owner Trustee under a Trust
Agreement dated as of August 12, 1986
with Public Service Company of New Mexico
and
CHEMICAL BANK,
as Indenture Trustee
Original Indenture recorded August 18, 1986, as
Instrument No. 86-439394 and Supplemental Indenture No. 1
thereto, dated as of November 18, 1986, recorded
November 25, 1986 as Instrument No. 86-650753, all
in Maricopa County, Arizona Recorder's Office.
<PAGE>
SUPPLEMENTAL INDENTURE No. 2 dated as of March 8, 1995 to Trust
Indenture, Mortgage, Security Agreement and Assignment of Rents dated as of
August 12, 1986, between THE FIRST NATIONAL BANK OF BOSTON, a national
banking association (FNB), not in its individual capacity, but solely as
Owner Trustee (the Owner Trustee) under a Trust Agreement dated as of August
12, 1986, between FNB, whose address is Blue Hills Office Park, Mail Stop 45-
02-15, 150 Royall Street, Canton, Massachusetts 02021, with Public Service
Company of New Mexico, a New Mexico corporation (successor by assignment to
the interest originally held by Burnham Leasing Corporation, a New York
corporation), and CHEMICAL BANK, a New York banking corporation (the
Indenture Trustee), whose address is 450 West 33rd Street, New York, New York
10001, Attention Corporate Trustee Administration Department.
W I T N E S S E T H:
WHEREAS, the Owner Trustee and the Indenture Trustee have entered
into a Trust Indenture, Mortgage, Security Agreement and Assignment of Rents
dated as of August 12, 1986 (the Indenture) pursuant to which the Owner
Trustee has issued the Initial Series Note;
WHEREAS, the Owner Trustee and the Indenture Trustee desire to
amend the Indenture as set forth in Section 2 hereof;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in
Appendix A to the Indenture.
SECTION 2. Amendments.
(a) Background. On September 2, 1992, the Lessee became the
successor by assignment to the right, title and interest of the original
Owner Participant in and to the Transaction Documents and the Trust Estate.
Public Service Company of New Mexico ("PNM"), both as Lessee and Owner
Participant, has determined that, from time to time, it may cause the
prepayment, in whole or in part, of the Notes Outstanding under the
Indenture. PNM, Funding Corp, the Owner Trustee and FNB (in its capacity as
Owner Trustee under the Trust Agreement dated as of December 16, 1985 with
PNM (as successor by assignment to the original owner participant
thereunder)) have entered into a Note Prepayment Agreement dated as of
January , 1995 (the "Note Prepayment Agreement"). Among other things, the
Note Prepayment Agreement contemplates that this Supplemental Indenture No.
2 will be executed and delivered.
(b) Amendment to Section 3.8. The requirement of Section 3.8 of
the Indenture that final payment of a Note be made only against surrender of
such Note is hereby deleted.
(c) Amendment to Section 3.9 (a). The following sentence is
added at the end of Section 3.9(a):
"In the event that (in accordance with the applicable provisions
of a Note) the Owner Trustee determines to prepay a Note in part,
the Owner Trustee may apply the principal portion of such
prepayment to prepay such remaining installments of principal in
such amounts as the Owner Trustee shall identify in its notice of
prepayment (such notice of prepayment to be accompanied by an
appropriately prepared replacement Schedule I to the Note being
prepaid)."
(d) Amendment to Section 3.9(c). Anything in Section 3.9(c) of
the Indenture and any provision of any Note to the contrary notwithstanding,
in the event of a prepayment of a Note, prior notice of such prepayment need
not be given if the same institution is both the Indenture Trustee and the
holder, assignee and pledgee of the Note to be prepaid.
(e) Amendment to Section 4.3. Anything in Section 4.3 of the
Indenture to the contrary, at the request of the Owner Trustee, the Indenture
Trustee shall not destroy cancelled Notes but shall return the same marked
"CANCELLED" to the Owner Trustee.
(f) Amendment to Section 5.1. Clause first of Section 5.1 is
hereby amended and restated in its entirety as follows:
"first, so much of such payment as shall be required
to pay in full the aggregate amount of the payment
or payments of principal and/or premium and/or
interest (as well as any interest on overdue
principal or, to the extent permitted by law,
interest) then due and unpaid on all Notes (whether
a scheduled installment of principal and interest or
amounts due in respect of principal, premium and
accrued interest in the event that the Owner Trustee
shall exercise its prepayment option in whole or in
part) shall be distributed to the Holders of the
Notes ratably, without priority of one over the
other, in the proportion that the aggregate amount
of such payment or payments then due and unpaid on
all Notes held by each such Holder on such date
bears to the aggregate amount of such payment or
payments then due and unpaid on all Notes
Outstanding on such date, without priority of
principal, premium or interest over any of them;"
SECTION 3. Miscellaneous.
(a) Effective Date of Supplemental Indenture.
This Supplemental Indenture No. 2 shall be and become effective
upon the execution hereof by the parties hereto.
(b) Counterpart Execution.
This Supplemental Indenture No. 2 may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which, when so executed and delivered, shall be an original, but all
such counterparts shall together constitute but one and the same instrument.
(c) Execution as Supplemental Indenture.
This Supplemental Indenture No. 2 is executed and shall be
construed as an indenture supplemental to the Indenture and, as provided in
the Indenture, this Supplemental Indenture No. 2 forms a part thereof.
(d) Disclosure.
Pursuant to Arizona Revised Statutes Section 33-401,the
beneficiary of the Trust Agreement is Public Service Company of New Mexico,
a New Mexico corporation. The address of the beneficiary is Alvarado Square,
Albuquerque, New Mexico 87158, Attention: Treasurer. A copy of the Trust
Agreement is available for inspection at the offices of the Owner Trustee at
Blue Hills Office Park, Mail Stop 45-02-15, 150 Royall Street, Canton,
Massachusetts 02021, Attention of Corporate Trust Division.
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee and the Indenture Trustee
have each caused this Supplemental Indenture No. 2 to be duly executed by
their respective officers thereunto duly authorized, all as of the date first
set forth above.
<PAGE>
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity,
but solely as Owner Trustee
under the Trust Agreement dated
as of August 12, 1986, with
Public Service Company of New
Mexico
By
Name:
Title:
CHEMICAL BANK,
By
Vice President
CONSENT AND DIRECTIVE
The undersigned, as trustee under the Collateral Trust Indenture
(as defined in Appendix A to the within-mentioned Indenture), is the assignee
and pledgee of First PV Funding Corporation in respect of the Notes which are
presently outstanding under the Indenture being supplemented by the foregoing
instrument. In accordance with the provisions of such Collateral Trust
Indenture (as amended by the 1995 Supplement thereto dated as of February 14,
1995) and pursuant to the Consolidated Joint Officers' Certificate, Company
Request, Lessee Request and Notice dated March 8, 1995, the undersigned, as
such assignee and pledgee, and as holder of all of the Notes outstanding
under the Indenture, hereby CONSENTS to the foregoing instrument and DIRECTS
the Indenture Trustee to execute and deliver the same.
<PAGE>
CHEMICAL BANK,
as Collateral Trust Trustee
By:
Name:
Title:<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 8th day of March, 1995, before me personally came
, to me known, who, being by me duly sworn, did acknowledge, depose and say
that he resides at , Massachusetts; that he is an
of THE FIRST NATIONAL BANK OF BOSTON, a national banking association,
described in and which executed the foregoing instrument; and that he signed
his name thereto on behalf of said association by authority of the Board of
Directors of such association.
<PAGE>
Notary Public
[NOTARIAL SEAL]<PAGE>
Term Expires:<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 8th day of March, 1995, before me personally came
, to me known, who, being by me duly sworn, did acknowledge, depose
and say that he resides at , ; that he is a Vice
President of CHEMICAL BANK, a New York banking corporation, described in and
which executed the foregoing instrument; and that he signed his name thereto
on behalf of said corporation by authority of the Board of Directors of such
corporation.
<PAGE>
Notary Public
[NOTARIAL SEAL]<PAGE>
Term Expires:
