Exhibit 10.1

This exhibit is filed to clarify and restate the exhibit filed as Exhibit 10.1
to the Company’s Annual Report on Form 10-K for the fiscal year ended December
31, 2009
  
Change in Director Compensation
  
Non-employee directors of PNM Resources, Inc. (the “Company”) receive their
annual retainer in the form of cash and stock-based compensation as determined
by the Company’s Board of Directors.   At the December 2009 Board meeting, the
Board approved increasing the 2010 annual retainer for non-employee directors
from the 2009 annual retainer reported in the Company’s 2009 Proxy Statement by
increasing the amount of time-vested restricted stock rights from 2,500 to
4,000.  No other changes were made to the amount of stock options, amount of
annual cash retainer, or meeting and chair fees.  Thus, the 2010 annual retainer
for non-employee directors is as follows:
 
Annual Retainer:
 
$35,000 (1), 1,000 stock options* and 4,000 restricted stock rights*
     
Annual Committee Chair Fee:
 
$  5,000 paid in quarterly installments (in addition to meeting attendance
fees), except that the Annual Audit and Ethics Committee Chair Fee is $10,000
     
Attendance Fees:
(no attendance fee for teleconference meetings less than 1 hour in duration)
 
$    1,750  per Board meeting
$    1,500 per Board Committee meeting

 
* Stock options and restricted stock rights granted under the Company’s Omnibus
Performance Equity Plan (“PEP”) each vest in three equal annual installments
beginning on the first anniversary of the grant date.  These awards are
typically made at the annual meeting of directors, unless the meeting occurs
during a black-out period for trading in the Company’s securities as specified
in the Company’s Insider Trading Policy.  As set forth under the Company’s Stock
Option Grant Policy, under those circumstances, the Board will either (a)
schedule a special meeting after the expiration of the black-out period, (b)
make awards pursuant to a unanimous written consent executed after the
expiration of the black-out period, or (c) pre-approve the equity awards with an
effective date after the expiration of the black-out period.  The date of the
awards is the date on which the Board approves the awards, unless (i) the
approval date is a non-trading day, in which case the date is the immediately
preceding trading date or (ii) in the case of pre-approval during a black-out
period, in which case the grant date is the first trading date after the
expiration of the black-out period.  The exercise price of the stock option is
equal to the closing price of the common stock on the New York Stock Exchange on
the date of the grant.   The PEP prohibits option re-pricing.
  
Directors are also reimbursed for any Board-related expenses, such as travel
expenses incurred to attend Board and Board committee meetings and director
educational programs.

(1) Jeffry E. Sterba retired as the Company’s Chief Executive Officer (“CEO”)
effective March 1, 2010.  While employed as CEO, Mr. Sterba received no
additional compensation for serving as a director or as the Chairman of the
Board and was only reimbursed for any travel related expenses to Board
meetings.  As reported in a Current Report on Form 8-K filed February 19, 2010,
in February 2010, the Board asked Mr. Sterba to continue to serve as Chairman
following his retirement as CEO.  In his role as Chairman, Mr. Sterba will,
among other things, provide support on strategic and public policy issues to the
Company.  He also continues to serve as chair of the First Choice Power board of
managers and as a PNMR representative on the board of Optim Energy, LLC and as
its chair.  As compensation, Mr. Sterba receives a separate annual retainer of
$250,000, prorated from March 1-December 31, 2010 (in lieu of the $35,000 annual
cash retainer received by other non-employee directors).    As reported in the
Company’s 2010 proxy statement, effective March 1, 2010, Mr. Sterba also
receives  Board attendance fees and is eligible to receive the annual equity
award of 1,000 stock options and 4,000 restricted stock rights typically made at
the annual meeting of directors.  In addition, Mr. Sterba will be reimbursed for
any Board-related expenses, such as travel expenses incurred to attend Board
meetings. 

 
 

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