**Exhibit 4.23****PUBLIC SERVICE COMPANY OF NEW MEXICO****TO****THE BANK OF NEW YORK TRUST COMPANY, N.A.****Trustee** **SEVENTH SUPPLEMENTAL INDENTURE****Dated as of June 1, 2007****To****INDENTURE****Dated as of March 11, 1998** **Providing for****2007 Pollution Control Series A Senior Unsecured Notes**
 
 

 
**SEVENTH SUPPLEMENTAL INDENTURE**, dated as of June 1, 2007, between **PUBLIC SERVICE COMPANYOF NEW MEXICO**, a corporation duly organized and existing under the laws of the State of NewMexico (the “**Company**”), having its principal office at Alvarado Square, Albuquerque, New Mexico87158, and **THE BANK OF NEW YORK TRUST COMPANY, N.A.**(as successor to JPMorgan Chase Bank, N.A.(formerly JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank))), a national bankingassociation, as Trustee (the “**Trustee**”) under the Indenture dated as of March 11, 1998 between theCompany and the Trustee (the “**Indenture**”).**RECITALS OF THE COMPANY**The Company has executed and delivered the Indenture to The Chase Manhattan Bank, as Trustee,to provide for the issuance from time to time of its senior notes (the “**Notes**”), said Notes to beissued in one or more series as in the Indenture provided.The Company has executed and delivered to the Trustee a First Supplemental Indenture, dated asof March 11, 1998, between the Company and the Trustee to establish the forms and terms of sevenseries of Notes, a Second Supplemental Indenture, dated as of March 11, 1998, between the Companyand the Trustee to establish the forms and terms of three series of Notes, a Third SupplementalIndenture, dated as of October 1, 1999, between the Company and the Trustee to establish the formsand terms of one series of Notes, a Fourth Supplemental Indenture, dated as of May 1, 2003, betweenthe Company and the Trustee to establish the forms and terms of one series of Notes, a FifthSupplemental Indenture, dated as of May 1, 2003, between the Company and the Trustee to establishthe forms and terms of one series of Notes, and a Sixth Supplemental Indenture, dated as of May 1,2003, between the Company and the Trustee to establish the forms and terms of one series of Notes,(the Indenture, as supplemented by said First Supplemental Indenture, said Second SupplementalIndenture, said Third Supplemental Indenture, said Fourth Supplemental Indenture, said FifthSupplemental Indenture and said Sixth Supplemental Indenture, collectively, the “Indenture, asheretofore supplemented”).On October 2, 2006, The Bank of New York Trust Company, N.A. succeeded to JPMorgan Chase Bank,N.A. (formerly JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank)) as Trustee.Pursuant to the terms of the Indenture, the Company desires to provide for the establishmentof a new series of Notes to be known as its 2007 Pollution Control Series A Senior Unsecured Notes(the “**2007A Notes**”), the form and substance of the 2007A Notes and the terms, provisions, andconditions thereof to be set forth as provided in the Indenture and this Seventh SupplementalIndenture.The Company and the City of Farmington, in the County of San Juan, an incorporatedmunicipality, a body politic and corporate, existing under the constitution and laws of the Stateof New Mexico (together with its successors and assigns, the “**City**”), are concurrently herewithentering into an Installment Sale Agreement, dated as of June 1, 2007, relating to certainfacilities located at the San Juan Generating Station, between the City, as vendor, and theCompany, as vendee (the “**Sale Agreement**”), whereby the City has agreed to cooperate withthe Company and will issue and deliver its pollution control revenue bonds under the PollutionControl Revenue Bond Act, §§ 3-59-1 to 3-59-14 NMSA 1978, as amended.
 
 

 
Pursuant to Ordinance No. 2007-1183, adopted by the City on May 22, 2007, as supplemented byResolution No. 2007-1239, adopted by the City on June 12, 2007 (as so supplemented, the“**Ordinance**”), the City has (1) authorized and provided for the issuance of $20,000,000 aggregateprincipal amount of its Pollution Control Revenue Bonds, 2007 Series A (Public Service Company ofNew Mexico San Juan Project) (the “**Bonds**”) to bear interest at the rate of 5.15% per annum and tomature on June 1, 2037 and (2) appointed Bank of Albuquerque, N.A., as trustee under the Ordinance(together with any successor trustee under the Ordinance, the “**Bond Trustee**”).Under the Sale Agreement, the Company is obligated to make certain payments to the City,which the City has pledged and assigned to the Bond Trustee by the terms of the Ordinance, toprovide for the payment of the principal of, and premium, if any, and interest on, the Bonds.The Company by the Guaranty Agreement, dated as of June 1, 2007 (the “**Guaranty**”), by andbetween the Company and the Bond Trustee, guarantees payment of the principal of, and interest onthe Bonds (the “**Guaranteed Amounts**”) and agrees to issue its 2007A Notes, to be delivered to theBond Trustee, as security for the performance of the Company’s obligation under the Guaranty topay the Guaranteed Amounts.Pursuant to an Insurance Agreement (“**Bond Insurance Agreement**”), dated as of June 26, 2007,between the Company and Financial Guaranty Insurance Company (the “**Bond Insurer**”), payment of theprincipal of, and interest on the Bonds, when due, will be insured by a Municipal Bond New IssueInsurance Policy for the Bonds (“**Bond Insurance Policy**”) to be issued by the Bond Insurersimultaneously with the issuance of the Bonds.Section 9.01 of the Indenture provides that, without the consent of any Holders, the Company,when authorized by a Board Resolution, and the Trustee, at any time and from time to time, mayenter into one or more indentures supplemental to the Indenture as in said Section 9.01 provided,and the Company desires to amend the Indenture, as heretofore supplemented, as hereinafterprovided, and has requested that the Trustee join in the execution and delivery hereof.All things necessary to make this Seventh Supplemental Indenture a valid agreement of theCompany, and to make the 2007A Notes, when executed by the Company and authenticated and deliveredby the Trustee, the valid obligations of the Company, have been done.**NOW, THEREFORE, THIS SEVENTH SUPPLEMENTAL INDENTURE WITNESSETH**:For and in consideration of the premises and the acceptance of the 2007A Notes by the BondTrustee under the Ordinance as collateral security for the Bonds and the issuance of the BondInsurance Policy by the Bond Insurer, and for the purpose of setting forth, as provided in theIndenture, the form and substance of the 2007A Notes and the terms, provisions, andconditions thereof, it is mutually agreed, for the equal and proportionate benefit of all Holdersof the 2007A Notes, as follows:
 
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**ARTICLE ONE****GENERAL TERMS AND CONDITIONS**