EXHIBIT
4.3






EXECUTION
COPY






PNM
RESOURCES, INC.






to






U.S.
BANK NATIONAL ASSOCIATION,






Trustee













SUPPLEMENTAL
INDENTURE NO. 2






Dated
as of August 4, 2008













(For
Senior Notes)












TABLE
OF CONTENTS
    Article
1
 DEFINITIONS
 Section
      1.01
              Relation
      to Base
      Indenture
              2Section
      1.02
              Definition
      of
      Terms
              2
 
 Article
2
 CHARGES
TO THE GENERAL TERMS AND CONDITIONS
 OF THE
ORIGINAL SENIOR NOTES
 
 Section
      2.01
              Amendment
      of Section 1.02 of Supplemental Indenture No. 1
              4Section
      2.02
              Amendment
      of Section 2.04 of Supplemental Indenture No. 1
              4Section
      2.03
              Amendment
      of Section 2.05 of Supplemental Indenture No. 1
              4Section
      2.04
              Amendment
      of Article 8 of Supplemental Indenture No. 1
              5Section
      2.05
              Amendment
      of Exhibit A of Supplemental Indenture No. 1
              10
 
 Article
3
 MISCELLANEOUS
 
 Section
      3.01
              Ratification
      of Indenture
              10Section
      3.02
              Trustee
      not Responsible for
      Recitals
              10Section
      3.03
              New
      York Law to
      Govern
              10Section
      3.04
              Separability
              10Section
      3.05
              Counterparts
              10
 
  i




SUPPLEMENTAL INDENTURE NO. 2,
dated as of August 4, 2008 (“Supplemental Indenture No.
2”), between PNM
RESOURCES, INC., a corporation duly organized and existing under the laws
of the State of New Mexico (the “Company”), having its
principal office at Alvarado Square, Albuquerque, New Mexico 87158, and U.S. BANK NATIONAL
ASSOCIATION, a national banking association, as Trustee (the “Trustee”).






RECITALS
OF THE COMPANY






WHEREAS, the Company has
heretofore executed and delivered to the Trustee an Indenture dated as of
October 7, 2005 (the “Base
Indenture”), providing for the issuance from time to time of series of
the Notes (as defined in
the Base Indenture).






WHEREAS, pursuant to Section 9.01(7) of the Base
Indenture, the Company has heretofore executed and delivered to the Trustee a
Supplemental Indenture dated as of October 7, 2005 (the “Supplemental Indenture No. 1”and, together with the Base Indenture, the “Indenture”) to establish the
form and terms of the Company’s 5.1% Senior Notes due August 16, 2010 (the “Original Senior Notes”) as
permitted by Section
3.01 of the Base Indenture.






WHEREAS, on October 7,
2005, pursuant to Section
2.01 and Section
3.01 of the Base
Indenture, the Company issued $100,000,000 aggregate principal amount of the
Original Senior Notes, all of which remain Outstanding on the date
hereof.






WHEREAS, Section 9.02 of the
Base Indenture provides that, with the consent of the Holders of the Notes of
all series then Outstanding under the Indenture, considered as one class, by Act
of said Holders delivered to the Company and the Trustee, the Company, when
authorized by or pursuant to a Board Resolution, and the Trustee may enter into
an indenture or indentures supplemental to the Base Indenture for the purpose of
adding any provisions to, or changing in any manner or eliminating any of the
provisions of, the Indenture.






WHEREAS,the Company now
desires to amend the Indenture in order to change the terms of the Original
Senior Notes (such Original Senior Notes as so modified the “Amended Senior
Notes”).






WHEREAS,Holders of all Notes
Outstanding (as such terms are defined in the Base Indenture) have heretofore
consented to the changes to the Indenture and the Original Senior Notes embodied
in and to be effected by this Supplemental Indenture No. 2 pursuant to Section 9.02of the Base
Indenture.






WHEREAS, the Company has
requested that the Trustee execute and deliver this Supplemental Indenture No.
2, and all requirements necessary to make this Supplemental Indenture No. 2 a
valid, binding and enforceable instrument in accordance with its terms, and to
make the Amended Senior Notes, when executed by the Company and authenticated
and delivered by the Trustee, the valid, binding and enforceable obligations of
the Company, have been done and performed, and the execution and delivery of
this Supplemental Indenture No. 2 has been duly authorized in all
respects.






1


NOW, THEREFORE, in
consideration of the covenants and agreements set forth herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:






Article
1




DEFINITIONS




Section
1.01  Relation to Base
Indenture.  This Supplemental Indenture No. 2 constitutes an
integral part of the Base Indenture.




Section
1.02  Definition of Terms.
 For all purposes of this Supplemental Indenture No. 2:






(a)      
Capitalized terms used herein without definition shall have the meanings
specified in the Base Indenture or Supplemental Indenture No. 1, or, if not
defined in the Base Indenture or Supplemental Indenture No. 1, in the Purchase
Contract Agreement, the Pledge Agreement or the Remarketing Agreement, as
applicable;






(b)      
a term defined anywhere in this Supplemental Indenture No. 2 has the same
meaning throughout;






(c)      
the singular includes the plural and vice versa;






(d)      
headings are for convenience of reference only and do not affect
interpretation;






(e)      
the following terms have the meanings given to them in this Article 1and such meanings
shall supersede and replace the meanings given them, if any, in the Base
Indenture or Supplemental Indenture No. 1:






“Base Rate” means, if the
Company has elected for the Reset Rate to be a floating interest rate, the
applicable index rate or the method or formula for calculating an index rate
chosen by the Company in connection with such election as stated in the notice
provided for in Section
8.03(g).






“Pledge Agreement” means
the Amended and Restated Pledge Agreement, dated as of August 4, 2008,
among the Company, U.S. Bank National Association, as Collateral Agent,
Custodial Agent and Securities Intermediary, and U.S. Bank National Association,
as Purchase Contract Agent and attorney-in-fact for the Holders of the Purchase
Contracts, as amended from time to time.






“Purchase Contract Agreement”
means the Amended and Restated Purchase Contract Agreement, dated as of
August 4, 2008, between the Company and U.S. Bank National Association, as
purchase contract agent, as amended from time to time.






2


“Remarketing Agreement” means
the Remarketing Agreement, dated as of October 7, 2005, as amended and
supplemented by a letter agreement, dated as of August 4, 2008, among the
Company, the Remarketing Agent, and the Purchase Contract Agent, as amended from
time to time.






“Remarketing Price” shall have
the meaning set forth in Section 8.02.






“Resale Restriction Termination
Date” means, for any Restricted Senior Note (or beneficial interest
therein), one year (or such other period specified in Rule 144 (or any successor
provision)) from the Issuance Date.






“Reset Effective Date” means
the Purchase Contract Settlement Date, in the event of a Successful Remarketing
pursuant to which the Coupon Rate is reset to a Reset Rate.






“Reset Rate” means, at the
option of the Company, either (i) the fixed interest rate per annum (as
determined by the Remarketing Agent) or, (ii) if the Company has elected for the
Reset Rate to be a floating interest rate, the sum of the Reset Spread (as
determined by the Remarketing Agent) and the Base Rate, as necessary to remarket
the Remarketed Senior Notes at the Remarketing Price; provided that if there are no
Corporate Units outstanding and none of the Holders elect to have Separate
Senior Notes held by them remarketed, or in the case of a Failed Final
Remarketing, the interest rate payable on the Senior Notes will not be reset and
the interest rate payable on the Senior Notes shall continue to be the Coupon
Rate.






“Reset Spread” means the
number of basis points necessary to be added to the Base Rate on the applicable
Remarketing Date in order to remarket all of the Remarketed Senior Notes at the
Remarketing Price on such Remarketing Date, as determined in accordance with
Section
8.03.






“Treasury Portfolio” means a
portfolio of (1) U.S. treasury securities (or principal or interest strips
thereof) that mature on or prior to November 15, 2008 in an aggregate amount at
maturity equal to the Applicable Principal Amount, and, (2) in the case of a
Special Event Redemption, for each scheduled Interest Payment Date that occurs
after the Special Event Redemption Date to and including the Purchase Contract
Settlement Date, U.S. treasury securities (or principal or interest strips
thereof) that mature on or prior to the business day immediately preceding such
scheduled Interest Payment Date in an aggregate amount equal to the aggregate
interest payment (assuming no reset of the interest rate) that would have been
due on such scheduled Interest Payment Date on the Applicable Principal
Amount.






“Treasury Portfolio Purchase
Price” means the lowest aggregate ask-side price quoted by a Primary
Treasury Dealer to the Quotation Agent between 9:00 a.m. and 11:00 a.m., New
York City time, on the third Business Day immediately preceding the Special
Event Redemption Date for the purchase of the applicable Treasury Portfolio for
settlement on the Special Event Redemption Date.






The terms
“Supplemental Indenture No. 2,”
“Company,” “Trustee,” “Indenture,” “Base Indenture” “Supplemental Indenture No. 1,”
“Original Senior Notes”




3


and “Amended Senior Notes” shall
have the respective meanings set forth in the recitals to this Supplemental
Indenture No. 2 and the paragraph preceding such recitals.






Article
2




CHANGES
TO THE GENERAL TERMS AND CONDITIONS


OF
THE ORIGINAL SENIOR NOTES




Section
2.01  Amendment of Section 1.02 of
Supplemental Indenture No. 1.  Supplemental Indenture No.
1 is hereby amended by deleting the definition of “Definitive Senior Notes” from
Section 1.02 thereof.




Section
2.02  Amendment of Section 2.04 of
Supplemental Indenture No. 1.  Supplemental Indenture No.
1 is hereby amended by deleting Section 2.04 thereof in its entirety and
replacing it with the following:






Section
2.04.        Global or Definitive Senior
Notes.  Senior Notes that are no longer a component of the Corporate
Units and are released from the Collateral Account (as defined
in the Pledge Agreement) may, at the Company’s option, either be issued (i) in
fully registered, global form, and initially evidenced by one or more
certificates issued to Cede & Co., as nominee of The Depository Trust
Company, or (ii) in certificated form.




Section
2.03  Amendment of Section 2.05 of
Supplemental Indenture No. 1.  Supplemental Indenture No.
1 is hereby amended by deleting Section 2.05 thereof in its entirety and
replacing it with the following:






Section
2.05.        Interest. 
(a)  The Senior Notes will bear interest initially at the rate of 5.1% per
year (the “Coupon Rate”)
from the original date of issuance through and including the earlier of (i) the
Maturity Date and (ii) the day immediately preceding any Reset Effective
Date.  In the event of a Successful Remarketing of the Senior Notes, the
Coupon Rate will be reset by the Remarketing Agent at the appropriate Reset Rate
with effect from the related Reset Effective Date, as set forth under Section 8.03.  If the
Coupon Rate is so reset, the Senior Notes will bear interest at the Reset Rate
from time to time in effect from the related Reset Effective Date until the
principal thereof and interest thereon is paid or duly made available for
payment and shall bear interest, to the extent permitted by law, compounded on
each Interest Payment Date, on any overdue principal and payment of interest at
the Coupon Rate through and including the day immediately preceding the Reset
Effective Date and at the Reset Rate from time to time in effect
thereafter.






(b)      
Interest on the Senior Notes shall be payable quarterly in arrears on February
16, May 16, August 16 and November 16 of each year (each, an “Interest Payment Date”),
commencing November 16,




4


2005, to
the Person in whose name such Senior Note, or any predecessor Senior Note, is
registered at the close of business on the Record Date for such Interest Payment
Date.  Interest on the Senior Notes shall accrue from October 7,
2005.






Notwithstanding
the foregoing, in the event of a Successful Remarketing of the Senior Notes, the
Company may redetermine the Interest Payment Dates and the Senior Notes will
bear interest at the appropriate Reset Rate from time to time in effect from the
related Reset Effective Date payable either semi-annually or quarterly, as
determined by the Company.






(c)      
If the Reset Rate is a fixed interest rate, the amount of interest payable for
any full quarterly or semi-annual period, as the case may be, will be computed
on the basis of a 360-day year consisting of twelve 30-day months.  The
amount of interest payable for any period shorter than a full quarterly or
semi-annual period, as the case may be, for which interest is computed will be
computed on the basis of a 30-day month and, for any period less than a month,
on the basis of the actual number of days elapsed per 30-day month.  In the
event that any scheduled Interest Payment Date falls on a day that is not a
Business Day, then payment of interest payable on such Interest Payment Date
will be made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay).






(d)
      Notwithstanding any other provision of the
Indenture, in the event the Reset Rate is a floating interest rate, the Company
may elect (i) to modify the day count conventions set forth in this Section 2.05 and(ii) to modify the
definition of the term “Business Day” set forth in Section 1.02
herein.




Section
2.04  Amendment of Article 8 of
Supplemental Indenture No. 1.  Supplemental Indenture No.
1 is hereby amended by deleting Article 8 thereof in its entirety and replacing
it with the following:






Article
8


REMARKETING






Section
8.01.        Remarketing
Procedures.  (a)  Unless a Special Event Redemption, an Early
Settlement or a Cash Merger Early Settlement has occurred prior to the Initial
Remarketing Date, the Company shall engage the Remarketing Agent pursuant to the
Remarketing Agreement for the Remarketing of the Senior Notes.  The Company
will request, not later than seven nor more than 15 calendar days prior to the
Initial Remarketing Date, that the Trustee notify the Holders of




5


Separate
Senior Notes, Corporate Units and Treasury Units of the procedures to be
followed in the Remarketings.






(b)           Each
Holder of Separate Senior Notes may elect to have Separate Senior Notes held by
such Holder remarketed in all Remarketings.  A Holder making such an
election must, pursuant to the Pledge Agreement, notify the Custodial Agent and
deliver such Separate Senior Notes to the Custodial Agent on or prior to 5:00
p.m. (New York City time) on or prior to the seventh Business Day immediately
preceding the Initial Remarketing Date (but no earlier than the Interest Payment
Date immediately preceding the Initial Remarketing Date).  Any such notice
and delivery may not be conditioned upon the level at which the Reset Rate is
established in the Remarketing.  Any such notice and delivery may be
withdrawn on or prior to 5:00 p.m. (New York City time) on the seventh Business
Day immediately preceding the Initial Remarketing Date in accordance with the
provisions set forth in the Pledge Agreement.  Any such notice and delivery
not withdrawn by such time will be irrevocable with respect to all
Remarketings.  Pursuant to Section 5.07(c) of the Pledge
Agreement, by 12:00 noon, New York City time, on the Business Day immediately
preceding the Initial Remarketing Date, the Custodial Agent, based on the
notices and deliveries received by it prior to such time, shall notify the
Remarketing Agent of the principal amount of Separate Senior Notes to be
tendered for Remarketing and, upon a Successful Remarketing, shall cause such
Separate Senior Notes to be presented to the Remarketing Agent.  Under
Section 5.02 of the
Purchase Contract Agreement, Senior Notes that are components of Corporate Units
will be deemed tendered for Remarketing and will be remarketed in accordance
with the terms of the Remarketing Agreement.






(c)           The
right of each Holder of Senior Notes that are included in Corporate Units to
have such Senior Notes, and each Holder of Separate Senior Notes to have any
Separate Senior Notes (together, the “Remarketed Senior Notes”),
remarketed and sold on any Remarketing Date shall be limited to the extent that
(i) the Remarketing Agent conducts a Remarketing pursuant to the terms of the
Remarketing Agreement, (ii) a Special Event Redemption has not occurred prior to
such Remarketing Date, (iii) the Remarketing Agent is able to find a purchaser
or purchasers for Remarketed Senior Notes at the Remarketing Price and (iv) the
purchaser or purchasers deliver the purchase price therefor to the Remarketing
Agent as and when required.






(d)           Neither
the Trustee, the Company nor the Remarketing Agent shall be obligated in any
case to provide funds to make payment upon tender of Senior Notes for
remarketing.






6


Section
8.02.        Remarketing. 
Unless a Special Event Redemption, an Early Settlement or a Cash Merger Early
Settlement has occurred prior to the Initial Remarketing Date, on the Initial
Remarketing Date, the Remarketing Agent shall, pursuant and subject to the terms
of the Remarketing Agreement, use commercially reasonable efforts to remarket
the Remarketed Senior Notes at a price (the “Remarketing Price”) equal to
100.00% of the aggregate principal amount of the Remarketed Senior
Notes.






Section
8.03.        Reset Rate and Extended
Maturity Date.  (a)  In connection with each Remarketing, and
subject to Sections
8.03(b) and 8.03(c) below, the Remarketing
Agent shall determine, in consultation with the Company, the Reset Rate (with
the fixed interest rate or, in the case of a floating interest rate, the Reset
Spread rounded to the nearest one-thousandth (0.001) of one percent per annum)
that the Remarketed Senior Notes should bear in order to have an aggregate
market value equal to the Remarketing Price and that in the sole discretion of
the Remarketing Agent will enable it to remarket all of the Remarketed Senior
Notes at the Remarketing Price in such Remarketing.






(b)           Anything
herein to the contrary notwithstanding, the Remarketing Agent shall have no
obligation to determine whether there is any limitation under applicable law on
the Reset Rate or, if there is any such limitation, the maximum permissible
Reset Rate on the Senior Notes and shall rely solely upon written notice from
the Company (which the Company agrees to provide prior to the eighth Business
Day before the Initial Remarketing Date) as to whether or not there is any such
limitation in any applicable jurisdiction.






(c)           In
connection with each Remarketing, the Remarketing Agent, in consultation with
the Company, may extend the Maturity Date to a date selected by the Company that
is two or three years from the date on which the Reset Rate is set.  Such
extended maturity date (the “Extended Maturity Date”), if
any, will be specified in the Remarketing announcement and will become effective
on the Reset Effective Date.






(d)           In
connection with each Remarketing, the Company may also elect to add any
additional financial covenants as the Company may determine.  Such an
election would take effect, upon a Successful Remarketing, on the Reset
Effective Date.  In addition, as provided in Section 2.05(b) herein, upon a
Successful Remarketing, the Interest Payment Dates may be redetermined to
provide for payment of interest semi-annually instead of
quarterly.  Furthermore, as provided in Section 2.05(d) herein, upon a
Successful Remarketing at a floating interest rate Reset Rate, the business day
and day count conventions set forth in




7


Section 2.05 herein and the
definition of “Business Day” set forth in Section 1.02 herein may be
modified.






(e)           In
the event of a Failed Final Remarketing or if no Senior Notes are included in
Corporate Units and none of the Holders of the Separate Senior Notes elect to
have their Senior Notes remarketed in any Remarketing, the applicable interest
rate on the Senior Notes will not be reset and will continue to be the Coupon
Rate and the Maturity Date will not be extended.






(f)           In
the event of a Successful Remarketing, as of the Reset Effective Date, the
Coupon Rate shall be reset at the Reset Rate as determined by the Remarketing
Agent under the Remarketing Agreement and the Maturity Date, if extended, will
be extended to the Extended Maturity Date.






(g)           The
Company, at its option, may elect for the Reset Rate to be either a fixed
interest rate (as determined by the Remarketing Agent) or a floating interest
rate equal to the sum of the Reset Spread (as determined by the Remarketing
Agent) and the Base Rate (as determined by the Company).  The Amended
Senior Notes may have such terms in addition to or in lieu of any one or more of
the terms established pursuant to any of the provisions of this Supplemental
Indenture No. 2 and may be in such form, in any case, as the Company may
determine and as shall be set forth in an indenture supplemental to the
Indenture,  as supplemented and amended hereby; and the Trustee is
hereby authorized and directed to join with the Company in the execution and
delivery of any such supplemental indenture, such supplemental indenture, if
any, to be effective as the Reset Effective Date.








Section
8.04.        Failed
Remarketing.  (a)  If, by 4:00 p.m. (New York City time) on any
Remarketing Date, the Remarketing Agent is unable to remarket all of the
Remarketed Senior Notes at the Remarketing Price, pursuant to the terms and
conditions hereof, a Failed Remarketing shall be deemed to have occurred, and
the Remarketing Agent shall so advise by telephone the Purchase Contract Agent
and the Company.  Whether or not there has been a Failed Remarketing will
be determined in the sole reasonable discretion of the Remarketing Agent. 
Promptly following any Failed Final Remarketing, the Custodial Agent shall
return the Separate Senior Notes to the appropriate Holders.






(b)           The
Company shall cause a notice of a Failed Final Remarketing to be posted on the
Company’s website by the first Business Day following such Failed Final
Remarketing.






8


Section
8.05.        Put Right. 
(a)  Subject to paragraph (b) hereof, if there has not been a Successful
Remarketing prior to the Purchase Contract Settlement Date, Holders of Separate
Senior Notes and Holders of Senior Notes that are a component of Corporate Units
will, subject to this Section
8.05, have the right (the “Put Right”) to require the
Company to purchase their Senior Notes, on the Purchase Contract Settlement
Date, at a price per Senior Note equal to $1,000.00 plus accrued and unpaid
interest to but excluding the Purchase Contract Settlement Date (the “Put Price”).






(b)           The
Put Right of Holders of Senior Notes that are part of Corporate Units will be
automatically exercised unless such Holders (1) prior to 5:00 p.m., New York
City time, on the second Business Day immediately preceding the Purchase
Contract Settlement Date, provide written notice to the Purchase Contract Agent
of their intention to settle the related Purchase Contract with separate cash,
and (2) on or prior to 5:00 p.m., New York City time, on the Business Day
immediately preceding the Purchase Contract Settlement Date, deliver to the
Collateral Agent $25 in cash per Purchase Contract, in each case pursuant to the
Purchase Contract Agreement and such Holders shall be deemed to have elected to
pay the Purchase Price for the shares of Common Stock or Preferred Stock, as
applicable, to be issued under the related Purchase Contract from a portion of
the Proceeds of the Put Right of such Senior Notes equal to the Purchase Price
in full satisfaction of such Holders’ obligations under the Purchase Contracts,
and any remaining amount of the Put Price following satisfaction of the related
Purchase Contract will be paid to such Holder.






(c)           The
Put Right of a Holder of a Separate Senior Note shall only be exercisable upon
delivery of a notice to the Trustee by such Holder on or prior to 5:00 p.m., New
York City time, on the second Business Day immediately preceding the Purchase
Contract Settlement Date.  On or prior to the Purchase Contract Settlement
Date, the Company shall deposit with the Trustee immediately available funds in
an amount sufficient to pay, on the Purchase Contract Settlement Date, the
aggregate Put Price of all Separate Senior Notes with respect to which a Holder
has exercised a Put Right.  In exchange for any Separate Senior Notes
surrendered pursuant to the Put Right, the Trustee shall then distribute such
amount to the Holders of such Separate Senior Notes.






Section
8.06.        Additional Event of
Default.  In addition to the events listed as Events of Default in
Section 5.01 of the Base
Indenture, it shall be an additional Event of Default with respect to the Senior
Notes, if the Company shall not have satisfied its obligation to pay the Put
Price when due with respect to any Separate Senior Note following exercise of
the Put Right in accordance with Section 8.05.






9


Section
8.07        Legal
Holidays.  In case the Purchase Contract Settlement Date shall
not be a Business Day (notwithstanding any other provision of this Indenture or
of the Senior Notes), any Remarketing of Senior Notes shall not settle on such
date and remarketed Senior Notes shall be settled on the next succeeding
Business Day with the same force and effect as if made on such Purchase Contract
Settlement Date, and without any adjustment of the Purchase Price.




Section
2.05  Amendment of Exhibit A of
Supplemental Indenture No. 1.  Supplemental Indenture No.
1 is hereby amended by deleting Exhibit A thereto in its entirety and replacing
it with Exhibit A hereto.






Article
3


MISCELLANEOUS






Section
3.01  Ratification of
Indenture.  The Indenture, as supplemented by this Supplemental
Indenture No. 2, is in all respects ratified and confirmed, and this
Supplemental Indenture No. 2 shall be deemed part of the Indenture in the manner
and to the extent herein and therein provided.




Section
3.02  Trustee not Responsible for
Recitals.  The recitals herein contained are made by the Company and
not by the Trustee, and the Trustee assumes no responsibility for the
correctness thereof.  The Trustee makes no representation as to the
validity or sufficiency of this Supplemental Indenture No. 2.




Section
3.03  New York Law to
Govern.  THIS SUPPLEMENTAL INDENTURE NO. 2 AND EACH AMENDED SENIOR
NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.




Section
3.04  Separability.
 In case any one or more of the provisions contained in this Supplemental
Indenture No. 2 or in the Amended Senior Notes shall for any reason be held to
be invalid, illegal or unenforceable in any respect, then, to the extent
permitted by law, such invalidity, illegality or unenforceability shall not
affect any other provisions of this Supplemental Indenture No. 2 or of the
Amended Senior Notes, but this Supplemental Indenture No. 2 and the Amended
Senior Notes shall be construed as if such invalid or illegal or unenforceable
provision had never been contained herein or therein.




Section
3.05  Counterparts.
 This Supplemental Indenture No. 2 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.






[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK;






SIGNATURE
PAGE FOLLOWS]




10




[SIGNATURE
PAGE TO SUPPLEMENTAL INDENTURE NO. 2]






IN
WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No.
2 to be duly executed, as of the day and year first written above.




PNM
RESOURCES, INC.






By: /s/ Terry R.
Horn


Terry
R. Horn,


Vice President and Treasurer








U.S. BANK
NATIONAL ASSOCIATION,


as
Trustee






By: /s/Patrick J.
Crowley


Patrick J. Crowley


Vice President