Exhibit 10.5
EXECUTION COPY

 

FIRST AMENDMENT TO CREDIT AGREEMENT

THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is entered into as
of November 3, 2016 and is effective as of November 3, 2016 among PUBLIC SERVICE
COMPANY OF NEW MEXICO, a New Mexico corporation (the “Borrower”), the Lenders
party hereto and U.S. BANK NATIONAL ASSOCIATION, as Administrative Agent for the
Lenders (in such capacity, the “Administrative Agent”). Capitalized terms used
herein and not otherwise defined shall have the meanings ascribed thereto in the
Credit Agreement (as defined below).

R E C I T A L S

WHEREAS, the Borrower, the Lenders party thereto and the Administrative Agent
are parties to that certain Credit Agreement, dated as of January 8, 2014 (as
amended or modified from time to time, the “Credit Agreement”);

WHEREAS, the Borrower has requested a modification to the Credit Agreement as
described below; and

WHEREAS, the Administrative Agent and the Lenders party hereto are willing to
agree to such modification, subject to the terms set forth herein as more fully
set forth below.

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

A G R E E M E N T

1.Amendments to Credit Agreement.

(a)    The definition of “Material Lease” in Section 1.1 of the Credit Agreement
is hereby deleted in its entirety.
(b)    The following definition in Section 1.1 of the Credit Agreement is
amended and restated in its entirety to read as follows:
“Indebtedness” means, with respect to any Person (without duplication), (a) all
indebtedness and obligations of such Person for borrowed money or in respect of
loans or advances of any kind, (b) all obligations of such Person evidenced by
notes, bonds, debentures or similar instruments, (c) all reimbursement
obligations of such Person with respect to surety bonds, letters of credit and
bankers’ acceptances (in each case, whether or not drawn or matured and in the
stated amount thereof), (d) all obligations of such Person to pay the deferred
purchase price of property or services, (e) all indebtedness

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created or arising under any conditional sale or other title retention agreement
with respect to property acquired by such Person, (f) all obligations of such
Person as lessee under leases that are or are required to be, in accordance with
GAAP, recorded as capital leases, to the extent such obligations are required to
be so recorded, (g) the net termination obligations of such Person under any
Hedging Agreements, calculated as of any date as if such agreement or
arrangement were terminated as of such date in accordance with the applicable
rules under GAAP, (h) all Contingent Obligations of such Person, (i) all
obligations and liabilities of such Person incurred in connection with any
transaction or series of transactions providing for the financing of assets
through one or more securitizations or in connection with, or pursuant to, any
synthetic lease or similar off-balance sheet financing, (j) the aggregate amount
of uncollected accounts receivable of such Person subject at the time of
determination to a sale of receivables (or similar transaction) to the extent
such transaction is effected with recourse to such Person (whether or not such
transaction would be reflected on the balance sheet of such Person in accordance
with GAAP) and (k) all indebtedness referred to in clauses (a) through (j) above
secured by any Lien on any property or asset owned or held by such Person
regardless of whether the indebtedness secured thereby shall have been assumed
by such Person or is nonrecourse to the credit of such Person.

(c)    The following definitions are hereby added to Section 1.1 of the Credit
Agreement in the appropriate alphabetical order:
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of an institution described in clause (a) of this definition,
or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clauses (a) or (b) of this definition
and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any
person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

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“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

(d)    Clause (d) in the definition of “Defaulting Lender” in Section 1.1 of the
Credit Agreement is hereby amended to read as follows:     
(d) has become or is insolvent or has become the subject of a bankruptcy or
insolvency proceeding, or has had a receiver, conservator, trustee or custodian
appointed for it, or has taken any action in furtherance of, or indicating its
consent to, approval of or acquiescence in any such proceeding or appointment,
or has become the subject of a Bail-in Action.

(e)    Section 6.18 and Section 6.19 of the Credit Agreement are hereby deleted
in their entirety and replaced with the following:
6.18    [Reserved].

6.19    [Reserved].

(f)    Section 7.2 of the Credit Agreement is amended and restated in its
entirety to read as follows:
7.2     Financial Covenant.

The ratio of (a) Consolidated Indebtedness to (b) Consolidated Capitalization
shall be less than or equal to 0.65 to 1.0 as of the last day of any Fiscal
Quarter.

(g)    Clause (o) of Section 8.5 of the Credit Agreement is amended to read as
follows:
(o) Liens on Property that is subject to a lease that is classified as an
operating lease as of the Closing Date but which is subsequently converted to a
capital lease,
(h)    A new Section 11.22 is hereby added to the Credit Agreement to read as
follows:
11.22    Acknowledgement and Consent to Bail-In of EEA Financial Institutions.

Notwithstanding anything to the contrary in any Credit Document or in any other
agreement, arrangement or understanding among any such parties, each party
hereto acknowledges that any liability of any Lender that is an EEA Financial
Institution arising

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under any Credit Document, to the extent such liability is unsecured, may be
subject to the Write-Down and Conversion Powers of an EEA Resolution Authority
and agrees and consents to, and acknowledges and agrees to be bound by:

(a)    the application of any Write-Down and Conversion Powers by an EEA
Resolution Authority to any such liabilities arising hereunder which may be
payable to it by any Lender that is an EEA Financial Institution; and

(b)    the effects of any Bail-in Action on any such liability, including, if
applicable:

(i)    a reduction in full or in part or cancellation of any such liability;

(ii)    a conversion of all, or a portion of, such liability into shares or
other instruments of ownership in such EEA Financial Institution, its parent
undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be
accepted by it in lieu of any rights with respect to any such liability under
this Agreement or any other Credit Document; or

(iii)    the variation of the terms of such liability in connection with the
exercise of the Write-Down and Conversion Powers of any EEA Resolution
Authority.

(i)     Schedule 6.18 and Schedule 6.19 to the Credit Agreement are hereby
deleted in their entirety.
(j)    Footnote 2 in Schedule 1 to Exhibit 7.1(c) to the Credit Agreement is
hereby deleted.
2.Effectiveness. This Amendment shall be effective as of November 3, 2016;
provided that on or before such date the Administrative Agent shall have
received (i) copies of this Amendment duly executed by the Borrower, the
Administrative Agent and the Required Lenders and (ii) the Administrative
Agent’s and its affiliates’ fees and expenses (including fees and expenses of
counsel for the Administrative Agent) in connection with this Amendment.
 
3.Ratification of Credit Agreement. The term “Credit Agreement” as used in each
of the Credit Documents shall hereafter mean the Credit Agreement as amended and
modified by this Amendment and as amended and modified from time to time
hereafter. Except as herein specifically agreed, the Credit Agreement, as
amended by this Amendment, is hereby ratified and confirmed and shall remain in
full force and effect according to its terms. Each party hereto acknowledges and
consents to the modifications set forth herein and agrees that, other than as
explicitly set forth in Section 1 above, this Amendment does not impair, reduce
or limit any of its obligations under the Credit Documents (including, without
limitation, the indemnity obligations

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set forth therein) and that, after the date hereof, this Amendment shall
constitute a Credit Document.
 
4.Authority/Enforceability. The Borrower represents and warrants as follows:

(a)    It has taken all necessary action to authorize the execution, delivery
and performance of this Amendment.
(b)    This Amendment has been duly executed and delivered by the Borrower and
constitutes the Borrower’s legal, valid and binding obligations, enforceable in
accordance with its terms, except as such enforceability may be limited by
Debtor Relief Laws or similar laws affecting creditors’ rights generally or by
general principles of equity.
(c)    Other than the filing of annual short-term financing plans with the New
Mexico Public Regulation Commission in the normal course of business, and such
Commission’s actions thereon, no consent, approval, authorization or order of,
or filing, registration or qualification with, any court or Governmental
Authority or third party is required in connection with the execution, delivery
or performance by the Borrower of this Amendment that has not been obtained or
completed.

5.Representations and Warranties. The Borrower represents and warrants to the
Lenders that (a) the representations and warranties of the Borrower set forth in
Section 6 of the Credit Agreement are true and correct as of the date hereof,
unless they specifically refer to an earlier date and except that, for purposes
of the foregoing, the references to “December 31, 2012” in Section 6.7 of the
Credit Agreement are hereby amended to “December 31, 2015,” (b) no event has
occurred and is continuing which constitutes a Default or an Event of Default,
and (c) it has no claims, counterclaims, offsets, credits or defenses to its
obligations under the Credit Documents, or to the extent it has any, they are
hereby released in consideration of the Lenders party hereto entering into this
Amendment.

6.No Conflicts. The Borrower represents and warrants that the execution and
delivery of this Amendment, the consummation of the transactions contemplated
herein and in the Credit Agreement (before and after giving effect to this
Amendment), and the performance of and compliance with the terms and provisions
hereof by the Borrower will not (a) violate, contravene or conflict with any
provision of its articles or certificate of incorporation, bylaws or other
organizational or governing document, (b) violate, contravene or conflict with
any law, rule, regulation (including, without limitation, Regulation U and
Regulation X), order, writ, judgment, injunction, decree or permit applicable to
the Borrower, (c) violate, contravene or conflict with contractual provisions
of, or cause an event of default under, any indenture, loan agreement, mortgage,
deed of trust, contract or other agreement or instrument to which the Borrower
is a party or by which it or its properties may be bound, the violation of which
would have or would be reasonably expected to have a Material Adverse Effect or
(d) result in or require the creation of any Lien upon or with respect to the
Borrower’s properties.

7.Counterparts/Telecopy. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which

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shall constitute one and the same instrument. Delivery of executed counterparts
by telecopy or by electronic format (.pdf) shall be effective as an original.

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

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

BORROWER:
 
PUBLIC SERVICE COMPANY OF NEW MEXICO,
a New Mexico corporation

By:    /s/ Elisabeth Eden            
Name:    Elisabeth Eden            
Title:    Vice President and Treasurer        

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ADMINISTRATIVE AGENT:
 

U.S. BANK NATIONAL ASSOCIATION,
individually in its capacity as a Lender and in its capacity as Administrative
Agent
 

By:    /s/ Raymond J. Palmer            
Name:    Raymond J. Palmer                
Title:    Sr. Vice President                
 

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LENDERS:

BOKF, NA DBA BANK OF ALBUQUERQUE,
as a Lender

By:    /s/ John Valentine            
Name:    John Valentine                
Title:    SVP                    

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BANK OF THE WEST,
as a Lender

By:    /s/ Philip Garlinghouse            
Name:    Philip Garlinghouse            
Title:    Vice President                

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WASHINGTON FEDERAL N.A.,
as a Lender

By:    /s/ Joshua Smith            
Name:    Joshua Smith                
Title:    V.P.                    

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FIRST NATIONAL BANK OF SANTA FE,
as a Lender

By:    /s/ Michael L. Roach            
Name:    Michael L. Roach            
Title:    Senior Vice President            

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SOUTHWEST CAPITAL BANK,
as a Lender

By:    /s/ Katja A. Fitz            
Name:    Katja A. Fitz                
Title:    Asst. Vice President            

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NEW MEXICO BANK & TRUST,
as a Lender

By:    /s/ Robert W. Eaton            
Name:    Robert W. Eaton            
Title:    Executive VP                

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FOUR CORNERS COMMUNITY BANK,
as a Lender

By:    /s/ Roger LaHart            
Name:    Roger LaHart                
Title:    Chief Lending Officer            

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WESTERN COMMERCE BANK,
CARLSBAD, NEW MEXICO,
as a Lender

By:    /s/ Mike Hoyl                
Name:    Mike Hoyl                
Title:    Executive Vice President        

PUBLIC SERVICE COMPANY OF NEW MEXICO
FIRST AMENDMENT TO CREDIT AGREEMENT