Common use of Issuance of Recovery Bonds Clause in Contracts

Issuance of Recovery Bonds. (a) The Company may issue one or more series of Recovery Bonds pursuant to the original Financing Order or any subsequent Financing Order. Each series of Recovery Bonds will be secured by separate Recovery Property and other Recovery Bond Collateral. Recovery Property which is pledged to secure one series of Recovery Bonds shall not be pledged to secure any other series of Recovery Bonds. (b) Following the initial issuance of Recovery Bonds, the Company shall not issue any series of Recovery Bonds (“Additional Issuances”) unless: (i) the Rating Agency Condition set forth in the Basic Documents for any outstanding series of Recovery Bonds has been satisfied; (ii) the Additional Issuance shall receive a rating or ratings as required by the applicable Financing Order; (iii) each Additional Issuance shall have recourse only to the Recovery Bond Collateral pledged in connection with such Additional Issuance, shall be nonrecourse to any of the Company’s other assets and shall not constitute a claim against the Company if cash flow from the pledged Recovery Bond Collateral is insufficient to pay such Additional Issuance in full; (iv) the Company has delivered to the Indenture Trustee an opinion of counsel of a nationally recognized firm experienced in such matters to the effect that after such issuance, in the opinion of such counsel, if the Member were to become a debtor in a case under the United States Bankruptcy Code (Title 11, U.S.C.), a federal court exercising bankruptcy jurisdiction and exercising reasonable judgment after full consideration of all relevant factors would not order substantive consolidation of the assets and liabilities of the Company with those of the bankruptcy estate of the Member, subject to the customary exceptions, qualifications and assumptions contained therein; (v) the Company has delivered to the Indenture Trustee documentation stating that the Recovery Bonds issued pursuant to such Additional Issuance shall have the benefit of a true-up mechanism; (vi) the transaction documentation for such Additional Issuance provides that holders of the Recovery Bonds of such Additional Issuance will not file or join in the filing of any involuntary bankruptcy petition against the Company; (vii) if the holders of the Recovery Bonds of any Additional Issuance are deemed to have any interest in any of the Bond Collateral pledged under the applicable Indenture (other than Recovery Bond Collateral pledged with respect to such Additional Issuance), the holders of such Recovery Bonds must agree that any such interest is subordinate to the claims and rights of the Holders of such other related series of Recovery Bonds; (viii) the Additional Issuance shall have its own bank accounts or trust accounts; and (ix) the Additional Issuance shall bear its own trustees fees and servicer fees, except that the allocation of such fees with respect to any Additional Issuance shall be governed by the terms of the related Indenture and the related Servicing Agreement.

Issuance of Recovery Bonds. (a) The Company may issue one or more series of Recovery Bonds pursuant to the original Financing Order or any subsequent Financing OrderOrder approved by the CPUC. Each series of Recovery Bonds will be secured by separate Recovery Property and other Recovery Bond Collateral. Recovery Property which is pledged to secure one series of Recovery Bonds shall not be pledged to secure any other series of Recovery Bonds. (b) Following the initial issuance of Recovery Bonds, the Company shall not issue any series of Recovery Bonds (“Additional Issuances”) unless: (i) the Rating Agency Condition set forth in the Basic Documents for any outstanding series of Recovery Bonds has been satisfied; (ii) the Additional Issuance shall receive a rating or ratings as required by the applicable Financing Order; (iii) each Additional Issuance shall have recourse only to the Recovery Bond Collateral pledged in connection with such Additional Issuance, shall be nonrecourse to any of the Company’s other assets and shall not constitute a claim against the Company if cash flow from the pledged Recovery Bond Collateral is insufficient to pay such Additional Issuance in full; (iv) the Company has delivered to the Indenture Trustee an opinion Opinion of counsel Counsel of a nationally recognized firm experienced in such matters to the effect that after such issuance, in the opinion of such counsel, if the Member were to become a debtor in a case under the United States Bankruptcy Code (Title 11, U.S.C.), a federal court exercising bankruptcy jurisdiction and exercising reasonable judgment after full consideration of all relevant factors would not order substantive consolidation of the assets and liabilities of the Company with those of the bankruptcy estate of the Member, subject to the customary exceptions, qualifications and assumptions contained therein; (v) the Company has delivered to the Indenture Trustee documentation a stating that the Recovery Bonds issued pursuant to such Additional Issuance shall have the benefit of a true-up mechanism; (vi) the transaction documentation for such Additional Issuance provides that holders of the Recovery Bonds of such Additional Issuance will not file or join in the filing of any involuntary bankruptcy petition against the Company; (vii) if the holders of the Recovery Bonds of any Additional Issuance are deemed to have any interest in any of the Bond Collateral pledged under the applicable Indenture (other than Recovery Bond Collateral pledged with respect to such Additional Issuance), the holders of such Recovery Bonds must agree that any such interest is subordinate to the claims and rights of the Holders of such other related series of Recovery Bonds; (viii) the Additional Issuance shall have its own bank accounts or trust accounts; and (ix) the Additional Issuance shall bear its own trustees fees and servicer fees, except that the allocation of such fees with respect to any Additional Issuance shall be governed by the terms of the related Indenture and the related Servicing Agreement.