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INTANGIBLE TRANSITION PROPERTY SALE AGREEMENT
between
ILLINOIS POWER SECURITIZATION LIMITED LIABILITY COMPANY
Grantee
and
ILLINOIS POWER SPECIAL PURPOSE TRUST
Note Issuer
Dated as of December 1, 1998
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.01. Definitions. . . . . . . . . . . . . . . . . . . 1
SECTION 1.02. Other Definitional Provisions. . . . . . . . . . 1
ARTICLE II
CONVEYANCE OF 1998 TRANSITION PROPERTY AND RELATED ASSETS . . . . . . . . 2
SECTION 2.01. Conveyance of 1998 Transition
Property and Related Assets. . . . . . . . . . . 2
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF GRANTEE . . . . . . . . . . . . . . . . 4
SECTION 3.01. Organization and Good Standing . . . . . . . . . 4
SECTION 3.02. Due Qualification. . . . . . . . . . . . . . . . 4
SECTION 3.03. Power and Authority. . . . . . . . . . . . . . . 4
SECTION 3.04. Binding Obligation . . . . . . . . . . . . . . . 5
SECTION 3.05. No Violation . . . . . . . . . . . . . . . . . . 5
SECTION 3.06. No Proceedings . . . . . . . . . . . . . . . . . 5
SECTION 3.07. Approvals. . . . . . . . . . . . . . . . . . . . 6
SECTION 3.08. The 1998 Transition Property and Related
Assets . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE IV
COVENANTS OF THE GRANTEE. . . . . . . . . . . . . . . . . . . . . . . . .11
SECTION 4.01. Corporate Existence. . . . . . . . . . . . . . .11
SECTION 4.02. No Liens . . . . . . . . . . . . . . . . . . . .11
SECTION 4.03. Delivery of Collections. . . . . . . . . . . . .12
SECTION 4.04. Notice of Liens. . . . . . . . . . . . . . . . .12
SECTION 4.05. Compliance with Law. . . . . . . . . . . . . . .12
SECTION 4.06. Covenants Related to the 1998
Transition Property,
Related Assets and the Notes . . . . . . . . . .12
SECTION 4.07. Protection of Title. . . . . . . . . . . . . . .13
SECTION 4.08. Nonpetition Covenants. . . . . . . . . . . . . .14
SECTION 4.09. Taxes. . . . . . . . . . . . . . . . . . . . . .15
SECTION 4.10. Performance of Obligations; Servicing. . . . . .15
SECTION 4.11. Additional Negative Covenants. . . . . . . . . .17
SECTION 4.12. No Other Business. . . . . . . . . . . . . . . .17
SECTION 4.13. No Borrowing . . . . . . . . . . . . . . . . . .17
SECTION 4.14. Guarantees Loans, Advances and Other
Liabilities. . . . . . . . . . . . . . . . . . .18
SECTION 4.15. Capital Expenditures . . . . . . . . . . . . . .18
SECTION 4.16. Notice of Defaults . . . . . . . . . . . . . . .18
SECTION 4.17. Separate Existence . . . . . . . . . . . . . . .18
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SECTION 4.18. Further Instruments and Acts . . . . . . . . . .21
SECTION 4.19. Subsequent Transition Property . . . . . . . . .21
ARTICLE V
THE GRANTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 5.01. Liability of Grantee; Indemnities. . . . . . . .23
SECTION 5.02. Merger or Consolidation of, or
Assumption of the Obligations of,
Grantee. . . . . . . . . . . . . . . . . . . . .24
SECTION 5.03. Limitation on Liability of Grantee
and Others . . . . . . . . . . . . . . . . . . .26
ARTICLE VI
MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . .26
SECTION 6.01. Amendment . . . . . . . . . . . . . . . . . . . . . .26
SECTION 6.02. Notices . . . . . . . . . . . . . . . . . . . . . . .28
SECTION 6.03. Assignment. . . . . . . . . . . . . . . . . . . . . .28
SECTION 6.04. Limitations on Rights of OTHERS . . . . . . . . . . .28
SECTION 6.05. Severability. . . . . . . . . . . . . . . . . . . . .29
SECTION 6.06. Separate Counterparts . . . . . . . . . . . . . . . .29
SECTION 6.07. Headings. . . . . . . . . . . . . . . . . . . . . . .29
SECTION 6.08. Governing Law . . . . . . . . . . . . . . . . . . . .29
SECTION 6.09. Assignment to Indenture Trustee . . . . . . . . . . .29
SECTION 6.10. Limitation of Liability . . . . . . . . . . . . . . .30
SECTION 6.11. Limitation of Liability . . . . . . . . . . . . . . .30
SECTION 6.12. Holders as Third-Party Beneficiaries. . . . . . . . .31
SECTION 6.13. Representations and Indemnities to Survive. . . . . .31
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INTANGIBLE TRANSITION PROPERTY SALE AGREEMENT dated as of December 1,
1998 between ILLINOIS POWER SECURITIZATION LIMITED LIABILITY COMPANY, a
Delaware limited liability company (the "Grantee"), and ILLINOIS POWER
SPECIAL PURPOSE TRUST, a Delaware business trust (the "Note Issuer").
WHEREAS the Note Issuer desires to purchase the 1998 Transition Property
created pursuant to the Public Utilities Act and the 1998 Funding Order,
together with the Related Assets; and
WHEREAS the Grantee is willing to sell such 1998 Transition Property and
Related Assets to the Note Issuer.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINITIONS. Capitalized terms used herein and not
otherwise defined herein have the meanings assigned to them in that certain
Indenture (including Appendix A thereto) dated as of the date hereof between
the Note Issuer and Xxxxxx Trust and Savings Bank, as the Indenture Trustee,
as the same may be amended, supplemented or otherwise modified from time to
time.
SECTION 1.02. OTHER DEFINITIONAL PROVISIONS.
(a) "AGREEMENT" means this Intangible Transition Property Sale
Agreement, as the same may be amended, supplemented or otherwise modified
from time to time.
(b) Non-capitalized terms used herein which are defined in the Public
Utilities Act shall, as the context requires, have the meanings assigned to
such terms in the Public Utilities Act, but without giving effect to
amendments to the Public Utilities Act after the date hereof which have a
material adverse effect on the Note Issuer or the Holders.
(c) All terms defined in this Agreement shall have the defined
meaning when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(d) The words "hereof," "herein," "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement; Section, Schedule and
Exhibit references contained in this Agreement are references to Sections,
Schedules and Exhibits in or to this Agreement unless otherwise specified;
and the term "including" shall mean "including without limitation".
(e) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter forms of such terms.
ARTICLE II
CONVEYANCE OF 1998 TRANSITION PROPERTY AND RELATED ASSETS
SECTION 2.01. CONVEYANCE OF 1998 TRANSITION PROPERTY AND RELATED ASSETS.
In consideration of the Note Issuer's delivery of $864,000,000 (less
underwriting discounts and original issue discount) to or upon the order of
the Grantee, the Grantee irrevocably sells, transfers, assigns, sets over and
otherwise conveys to the Note Issuer, without recourse (subject to the
obligations herein), all of its right, title and interest in, to and under:
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(a) the 1998 Transition Property (such sale, transfer, assignment,
set over and conveyance of the 1998 Transition Property includes, to the
fullest extent permitted by the Funding Law, the assignment of all revenues,
collections, claims, rights, payments, money or proceeds of or arising from
the IFCs pursuant to the 1998 Funding Order and the 1998 Initial Tariff),
including, without limitation, any contractual rights to collect IFCs from
Customers and Allocable IFC Revenue Amounts; and
(b) the Related Assets.
Such sale, transfer, assignment, set over and conveyance is expressly
stated to be a sale and absolute transfer, and pursuant to Section 18-108 of
the Funding Law, shall be treated as an absolute transfer (as in a true
sale), and not as a pledge or other financing, of the 1998 Transition
Property. The previous sentence is the express statement referred to in
Section 18-108 of the Funding Law. To the extent that, notwithstanding the
Funding Law, the Application and the 1998 Funding Order, the foregoing sale,
transfer, assignment, set over and conveyance is held not to be an absolute
transfer (as in a true sale) as contemplated under Section 18-108 of the
Funding Law, then such sale, transfer, assignment, set over and conveyance
shall be treated as a pledge of the 1998 Transition Property and the Grantee
shall be deemed to have granted a security interest to the Note Issuer in the
1998 Transition Property. The Grantee takes the position that it has no
rights in the 1998 Transition Property to which such a security interest
could attach because it has sold, transferred, assigned, set over or
otherwise conveyed all rights in, to and under the 1998 Transition Property
to the Note Issuer pursuant to Section 18-108 of the Funding Law.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF GRANTEE
The Grantee makes the following representations and warranties, as of
the Closing Date, on which the Note Issuer has relied in acquiring the 1998
Transition Property and Related Assets. These representations and warranties
shall survive the sale, transfer, assignment, set over and conveyance of the
1998 Transition Property and Related Assets to the Note Issuer, the pledge
thereof to the Indenture Trustee pursuant to the Indenture and the issuance
of the Notes.
SECTION 3.01. ORGANIZATION AND GOOD STANDING. The Grantee is duly
organized and validly existing as a limited liability company in good
standing under the laws of the State of Delaware, with the power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted, and
had at all relevant times, and has, the requisite power, authority and legal
right to own the 1998 Transition Property and Related Assets.
SECTION 3.02. DUE QUALIFICATION. The Grantee is duly qualified to do
business as a limited liability company in good standing, and has obtained
all necessary licenses and approvals, in all jurisdictions in which the
ownership or lease of property or the conduct of its business shall require
such qualifications, licenses or approvals (except where the failure to so
qualify would not be reasonably likely to have a material adverse effect on
the Grantee's business, operations, assets, revenues or properties).
SECTION 3.03. POWER AND AUTHORITY. The Grantee has the requisite power
and authority to execute and deliver this Agreement and to carry out its
terms; the Grantee has full power and authority to sell and assign the 1998
Transition Property and Related Assets to be sold and
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assigned to the Note Issuer and the Grantee has duly authorized such sale and
assignment to the Note Issuer by all necessary company action; and the
execution, delivery and performance of this Agreement have been duly
authorized by the Grantee by all necessary company action.
SECTION 3.04. BINDING OBLIGATION. This Agreement constitutes a legal,
valid and binding obligation of the Grantee enforceable against the Grantee
in accordance with its terms, subject to applicable insolvency,
reorganization, moratorium, fraudulent transfer and other similar laws
relating to or affecting creditors' rights generally from time to time in
effect and to general principles of equity (including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing),
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.05. NO VIOLATION. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof do not
(i) conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time) a default under,
the Operating Agreement or Certificate of Formation of the Grantee, or any
indenture, agreement or other instrument to which the Grantee is a party or
by which it shall be bound; (ii) result in the creation or imposition of any
Lien upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument; or (iii) violate any law or any order, rule or
regulation applicable to the Grantee of any court or of any Federal or state
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Grantee or its properties.
SECTION 3.06. NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the Grantee's knowledge, threatened, before any
court, Federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Grantee
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or its properties involving or relating to the Grantee or the Note Issuer or,
to the Grantee's knowledge, any other Person: (i) asserting the invalidity of
the Funding Law, this Agreement, any of the other Basic Documents or the
Notes, (ii) seeking to prevent the issuance of the Notes or the consummation
of any of the transactions contemplated by this Agreement or any of the other
Basic Documents, (iii) seeking any determination or ruling that could
reasonably be expected to materially and adversely affect the Grantee's
performance of its obligations under, or the validity or enforceability of
this Agreement, any of the other Basic Documents or the Notes, or (iv) which
could reasonably be expected to adversely affect the Federal or state income
tax attributes of the Notes.
SECTION 3.07. APPROVALS. No approval, authorization, consent, order or
other action of or filing with, any court, Federal or state regulatory body,
administrative agency or other governmental instrumentality is required in
connection with the Grantee's execution and delivery of this Agreement, the
Grantee's performance of the transactions contemplated hereby or the
Grantee's fulfillment of the terms hereof except those that have been
obtained or made.
SECTION 3.08. THE 1998 TRANSITION PROPERTY AND RELATED ASSETS.
(a) INFORMATION. At the Closing Date, all information provided by
the Grantee to the Note Issuer with respect to the 1998 Transition Property
(including the 1998 Funding Order and the 1998 Initial Tariff) and the
Related Assets is correct in all material respects.
(b) TITLE. It is the intention of the parties hereto that the
transfer and assignment herein contemplated constitute a sale and absolute
transfer of the 1998 Transition Property and Related Assets from the Grantee
to the Note Issuer and that no beneficial interest in or title to the 1998
Transition Property and Related Assets shall be part of the Grantee's estate
in the event of the filing of a bankruptcy petition by or against the Grantee
under any bankruptcy law. No portion of the 1998
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Transition Property and Related Assets has been sold, transferred, assigned,
pledged or otherwise conveyed by the Grantee to any Person other than the
Note Issuer. At the Closing Date, immediately prior to the sale hereunder,
the Grantee owns the 1998 Transition Property and Related Assets, free and
clear of all Liens and rights of any other Person, and no encumbrances,
offsets, defenses or counterclaims exist or have been asserted with respect
thereto.
(c) TRANSFER FILINGS. At the Closing Date, the 1998 Transition
Property and Related Assets have been validly transferred, assigned and sold
from the Grantee to the Note Issuer, the Note Issuer owns all the 1998
Transition Property and Related Assets, free and clear of all Liens and
rights of any other Person (other than Liens created pursuant to the
Indenture), and all filings to be made by the Grantee (including filings with
the ICC under the Funding Law) necessary in any jurisdiction to give the Note
Issuer a first priority perfected ownership interest in the 1998 Transition
Property and Related Assets have been made. No further action is required
under Illinois law to maintain such first priority perfected ownership
interest in the 1998 Transition Property. No further action, other than any
filings or other steps required to be taken with respect to proceeds or on
account of events occurring after the date hereof by Sections 9-103, 9-304,
9-306, 9-402(7) or 9-403(2)- (3) of the UCC, is required to maintain such
first priority perfected ownership interest in the Related Assets.
(d) STATE PLEDGE. The State of Illinois has agreed with the Holders,
pursuant to Section 18-105(b) of the Funding Law, as follows:
"(b) The State pledges to and agrees with the holders of any
transitional funding instruments who may enter into contracts with an
electric utility, grantee, assignee or issuer pursuant to this Article
XVIII that the State will not in any way limit, alter, impair or
reduce the value of intangible transition property created by, or
instrument funding charges approved by, a transitional funding order
so as to impair the terms of any contract made by such electric
utility, grantee, assignee or issuer with such holders or in any way
impair the
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rights and remedies of such holders until the pertinent grantee
instruments or, if the related transitional funding order does not
provide for the issuance of grantee instruments, the pertinent
transitional funding instruments and interest, premium and other costs
and charges related thereto, as the case may be, are fully paid and
discharged. Electric utilities, grantees and issuers are authorized to
include these pledges and agreements of the State in any contract with
the holders of transitional funding instruments or with any assignees
pursuant to this Article XVIII and any assignees are similarly
authorized to include these pledges and agreements of the State in any
contract with any issuer, holder or any other assignee. Nothing in
this Article XVIII shall preclude the State of Illinois from requiring
adjustments as may otherwise be allowed by law to the electric
utility's base rates, transition charges, delivery services charges,
or other charges for tariffed services, so long as any such adjustment
does not directly affect or impair any instrument funding charges
previously authorized by a transitional funding order issued by the
[ICC]."
As a result of the foregoing pledge, the State of Illinois may not, except as
provided in the succeeding sentence, in any way reduce, postpone, impair or
terminate the 1998 Transition Property in a manner substantially impairing
the Indenture or the rights and remedies of the Holders (and consequently,
may not revoke, reduce, postpone or terminate the 1998 Funding Order or the
rights of the Holders to receive IFC Payments and all other proceeds of the
1998 Transition Property), until the Notes, together with interest thereon,
are fully paid and discharged. Notwithstanding the immediately preceding
sentence, the State would be allowed to effect a temporary impairment of the
Holders' rights if it could be shown that a temporary impairment was
necessary to advance a significant and legitimate public purpose.
(e) 1998 FUNDING ORDER AND TARIFFS; OTHER APPROVALS. (i) The 1998
Funding Order pursuant to which the 1998 Transition Property has been created
has been duly entered by the ICC, is valid and binding, is Final and is in
full force and effect; (ii) the 1998 Initial Tariff is in full force and
effect and is not subject to modification by the ICC except as provided under
the Funding Law; (iii) as of the issuance of the Notes, the Notes are
entitled to the protections provided in Section 18-104(c) of the Funding Law
and, accordingly, the 1998 Funding Order, the 1998 Transition Property
8
and the IFCs are not revocable by the ICC; (iv) the ICC may not reduce,
postpone, impair or terminate the 1998 Transition Property, the 1998 Funding
Order or the IFCs; (v) the process by which the 1998 Funding Order was
adopted and approved and the 1998 Initial Tariff was filed, and the 1998
Funding Order and the 1998 Initial Tariff themselves, comply with all
applicable laws, rules and regulations and the ICC may not revoke, amend or
otherwise change the 1998 Initial Tariff in any manner which would defeat the
expectations of the Holders to receive IFC Payments on a timely basis; and
(vi) no other approval, authorization, consent, order or other action of, or
filing with, any court, Federal or state regulatory body, administrative
agency or other governmental instrumentality is required in connection with
the grant of the 1998 Transition Property, except those that have been
obtained or made.
(f) ASSUMPTIONS. At the Closing Date, the assumptions used in
calculating the IFCs are reasonable and made in good faith.
(g) CREATION OF 1998 TRANSITION PROPERTY. Upon the effectiveness of
the 1998 Initial Tariff: (i) all of the 1998 Transition Property constitutes
a current property right vested in the Grantee; (ii) the 1998 Transition
Property includes, without limitation, (A) the right, title and interest in
and to the IFCs authorized under the 1998 Funding Order, as adjusted from
time to time, (B) the right, title and interest in and to all revenues,
collections, claims, payments, money or proceeds of or arising from the IFCs
set forth in the 1998 Initial Tariff, and (C) all rights to compel Illinois
Power, as Servicer (or any successor), to file for and obtain adjustments to
the IFCs pursuant to the 1998 Funding Order; and (iii) the Grantee is
entitled to impose and collect the IFCs described in the 1998 Funding Order
and the 1998 Initial Tariff in an aggregate amount equal to the principal
amount of the Notes, all interest thereon, all amounts required to be
deposited in the Reserve Subaccount,
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the Overcollateralization Subaccount and the Capital Subaccount, and all
related fees, costs and expenses in respect of the Notes until they have been
paid in full, subject only to the $1.634 billion limitation set forth in the
1998 Funding Order as the maximum dollar amount of 1998 Transition Property
created thereunder.
(h) PROPERTY OF GRANTEE. To the fullest extent permitted by the
Funding Law and all other applicable law, the 1998 Transition Property and
the right to impose and collect IFCs contemplated thereunder constitute
property rights of the Grantee and its assigns, including the Note Issuer and
its assigns (including the Indenture Trustee on behalf of the Holders), which
property has been placed beyond the reach of Illinois Power and its
creditors, as in a true sale, and which property rights may not be limited,
altered, impaired, reduced or otherwise terminated by any subsequent actions
of Illinois Power or any third party and which shall, to the full extent
permitted by law, be enforceable against Illinois Power, its successors and
assigns, and all other third parties (including judicial lien creditors)
claiming an interest therein by or through Illinois Power or its successors
and assigns.
(i) NATURE OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties set forth in this SECTION 3.08, insofar as they involve
conclusions of law, are made not on the basis that the Grantee purports to be
a legal expert or to be rendering legal advice, but rather to reflect the
parties' good faith understanding of the legal basis on which the parties are
entering into this Agreement and the other Basic Documents and the basis on
which the Holders are purchasing the Notes, and to reflect the parties'
agreement that, if such understanding turns out to be incorrect or
inaccurate, the Grantee will be obligated to indemnify the Note Issuer and
its permitted assigns, and that the Note Issuer and its permitted assigns
will be entitled to enforce any rights and remedies
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under the documents, on account of such inaccuracy to the same extent as if
the Grantee had breached any other representations or warranties hereunder.
ARTICLE IV
COVENANTS OF THE GRANTEE
SECTION 4.01. CORPORATE EXISTENCE. So long as any of the Notes are
outstanding, the Grantee (a) will keep in full force and effect its
existence, rights and franchises as a limited liability company under the
laws of the State of Delaware (unless it becomes, or any successor Grantee
hereunder is or becomes, organized under the laws of any other State or of
the United States of America, in which case the Grantee will keep in full
effect its existence, rights and franchises under the laws of such other
jurisdiction), (b) will obtain and preserve its qualification to do business,
in each case to the extent that in each such jurisdiction such existence or
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Basic Documents to which the Grantee is
a party and each other instrument or agreement necessary or appropriate to
the proper administration of this Agreement and the transactions contemplated
hereby and (c) at all times hereafter, the Grantee will not elect nor cause
nor permit the Note Issuer to elect to be classified as an association
taxable as a corporation for federal income tax purposes.
SECTION 4.02. NO LIENS. Except for the conveyances hereunder, the
Grantee will not sell, pledge, assign or transfer to any other Person, or
grant, create, incur, assume, suffer to exist or otherwise assert any Lien
on, any of the 1998 Transition Property or Related Assets, or any interest
therein, and the Grantee shall defend the right, title and interest of the
Note Issuer and the Indenture
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Trustee in, to and under the 1998 Transition Property and Related Assets,
against all claims of third parties claiming through or under the Grantee.
SECTION 4.03. DELIVERY OF COLLECTIONS. If the Grantee receives
collections in respect of the IFCs or the proceeds thereof, or in replacement
therefor, including, without limitation, any Allocable IFC Revenue Amounts,
the Grantee agrees to hold such payments in trust for the Servicer and to pay
the Servicer all payments received by the Grantee in respect thereof as soon
as practicable after receipt thereof by the Grantee, but in no event later
than two Business Days after such receipt.
SECTION 4.04. NOTICE OF LIENS. The Grantee shall notify the Note Issuer
and the Indenture Trustee in writing promptly after becoming aware of any
Lien on any of the 1998 Transition Property or Related Assets other than the
conveyances hereunder and under the Indenture.
SECTION 4.05. COMPLIANCE WITH LAW. The Grantee shall comply with its
organizational or governing documents and all laws, treaties, rules,
regulations and determinations of any governmental instrumentality applicable
to it, to the extent that failure to so comply would not materially adversely
affect the Note Issuer's or the Indenture Trustee's interests in the 1998
Transition Property or Related Assets or under any of the Basic Documents or
the Grantee's performance of its obligations hereunder or under any of the
other Basic Documents to which it is party.
SECTION 4.06. COVENANTS RELATED TO THE 1998 TRANSITION PROPERTY, RELATED
ASSETS AND THE NOTES.
(a) So long as any of the Notes are outstanding, the Grantee shall
indicate in its financial statements that the Note Issuer and not the Grantee
owns the 1998 Transition Property and the Related Assets.
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(b) So long as any of the Notes are outstanding, the Grantee shall
not own or purchase any Notes.
(c) The Grantee agrees that upon its sale of the 1998 Transition
Property and Related Assets to the Note Issuer pursuant to this Agreement,
(i) to the fullest extent permitted by law, including applicable ICC
Regulations, the Note Issuer shall have all of the rights of the owner of the
1998 Transition Property (including all of the rights originally held by the
Grantee with respect to the 1998 Transition Property and Related Assets),
including the right (subject to the terms of the Servicing Agreement) to
exercise any and all rights and remedies to collect any amounts payable by
any Customer or third party collection agent, including any ARES, in respect
of the 1998 Transition Property, notwithstanding any objection or direction
to the contrary by the Grantee and (ii) any payment by any Customer or third
party collection agent, including any ARES, to the Note Issuer (or to the
Servicer for the benefit of the Note Issuer) shall discharge such Customer's
or third party's obligations in respect of the 1998 Transition Property to
the extent of such payment, notwithstanding any objection or direction to the
contrary by the Grantee.
(d) So long as any of the Notes are outstanding, (i) except with
respect to federal and other applicable taxes, the Grantee shall not make any
statement or reference in respect of the 1998 Transition Property or the
Related Assets that is inconsistent with the ownership interest of the Note
Issuer therein, and (ii) the Grantee shall not take any action in respect of
the 1998 Transition Property or the Related Assets except as otherwise
contemplated by the Basic Documents.
SECTION 4.07. PROTECTION OF TITLE. The Grantee shall execute and file
such filings, including filings with the ICC pursuant to the Funding Law, and
cause to be executed and filed such filings, all in such manner and in such
places as may be required by law fully to preserve, maintain,
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and protect the interests of the Note Issuer in the 1998 Transition Property
and Related Assets, including all filings required under the Funding Law
relating to the transfer of the ownership or security interest in the 1998
Transition Property by the Grantee to the Note Issuer. The Grantee shall
deliver (or cause to be delivered) to the Note Issuer file-stamped copies of,
or filing receipts for, any document filed as provided above, promptly
following such filing. The Grantee shall institute any action or proceeding
necessary to compel performance by the ICC or the State of Illinois of any of
their obligations or duties under the Funding Law, the 1998 Funding Order,
the 1998 Initial Tariff or any amendatory tariff filed pursuant to Section
18-104(k) of the Funding Law, and the Grantee agrees to take such legal or
administrative actions, including defending against or instituting and
pursuing legal actions and appearing or testifying at hearings or similar
proceedings, as may be reasonably necessary to protect the Note Issuer and
the Holders from claims, state actions or other actions or proceedings of
third parties which, if successfully pursued, would result in a breach of any
representation set forth in Article III. The costs of any such actions or
proceedings will be payable by the Grantee. The Grantee designates the Note
Issuer as its agent and attorney-in-fact to execute any filings with the ICC,
financing statements, continuation statements or other instruments required
by the Note Issuer pursuant to this Section, it being understood that the
Note Issuer shall have no obligation to execute any such instruments.
SECTION 4.08. NONPETITION COVENANTS. Notwithstanding any prior
termination of this Agreement or the Indenture, but subject to the ICC's
right to order the sequestration and payment of revenues arising with respect
to the 1998 Transition Property notwithstanding any bankruptcy,
reorganization or other insolvency proceedings with respect to Illinois
Power, the Grantee, the Note Issuer or any other grantee or assignee of the
1998 Transition Property pursuant to Section 18-
14
107(c)(4) of the Funding Law, the Grantee shall not, prior to the date which
is one year and one day after the termination of the Indenture, acquiesce,
petition or otherwise invoke or cause or join with any other Person to invoke
the process of any court or governmental authority for the purpose of
commencing or sustaining a case against the Note Issuer under any Federal or
state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of or for the Note Issuer or any substantial part of the property of
the Note Issuer, or ordering the winding up or liquidation of the affairs of
the Note Issuer.
SECTION 4.09. TAXES. So long as any of the Notes are outstanding, the
Grantee shall, and shall cause each of its subsidiaries to, pay all material
taxes, assessments and governmental charges imposed upon it or any of its
properties or assets or with respect to any of its franchises, business,
income or property before any penalty accrues thereon if the failure to pay
any such taxes, assessments and governmental charges would, after any
applicable grace periods, notices or other similar requirements, result in a
lien on the 1998 Transition Property or Related Assets; provided that no such
tax need be paid if the Grantee or one of its subsidiaries is contesting the
same in good faith by appropriate proceedings promptly instituted and
diligently conducted and if the Grantee or such subsidiary has established
appropriate reserves as shall be required in conformity with generally
accepted accounting principles.
SECTION 4.10. PERFORMANCE OF OBLIGATIONS; SERVICING.
(a) The Grantee may contract with other Persons to assist it in
performing its duties under this Agreement, and any performance of such
duties by a Person identified to the Note Issuer in an Officer's Certificate
of the Grantee shall be deemed to be action taken by the Grantee. In
addition, the Grantee agrees to perform, and shall be responsible and liable
for, the duties and obligations of the Note Issuer under Sections 3.02, 3.04,
3.05, 3.06, 3.07, 3.09, 3.14, 3.18, 3.19, 6.06(c), 6.07, 7.01,
15
7.03, 8.03 (regarding the direction of investment in Eligible Investments in
the Collection Account), and 8.06 of the Indenture, PROVIDED, HOWEVER, that
the Grantee may engage the Administrator to perform such duties and
obligations pursuant to the terms of the Administration Agreement.
(b) Except as otherwise expressly permitted therein, the Grantee
shall not waive, amend, modify, supplement or terminate any Basic Document or
any provision thereof without the written consent of the Note Issuer (which
consent shall not be withheld if the Indenture Trustee shall have consented
thereto) and prior written notice to the Rating Agencies. The Grantee shall
not terminate the Administration Agreement prior to the repayment in full of
all Notes.
(c) Upon any termination of the Servicer's rights and powers pursuant
to the Servicing Agreement, the Note Issuer shall promptly notify the Grantee
and the Rating Agencies. As soon as a Successor Servicer is appointed, the
Note Issuer shall notify the Grantee and the Rating Agencies of such
appointment, specifying in such notice the name and address of such Successor
Servicer.
(d) Without derogating from the absolute nature of the assignment
granted to the Note Issuer under this Agreement or the rights of the Note
Issuer hereunder, the Grantee will not, without the prior written consent of
the Note Issuer and prior written notice to the Rating Agencies, amend,
modify, waive, supplement, terminate or surrender, or agree to any amendment,
modification, supplement, termination, waiver or surrender of; the terms of
any Note Collateral or the Basic Documents, or waive timely performance or
observance by Illinois Power or the Servicer under the Grant Agreement or the
Servicing Agreement, respectively. If any such amendment, modification,
supplement or waiver shall be so consented to by the Note Issuer and the Note
Issuer shall so request, the Grantee shall execute and deliver, in its own
name and at its own expense, such agreements, instruments, consents and other
documents as shall be necessary or appropriate in the circumstances.
16
(e) The Grantee shall make all filings required under the Funding Law
relating to the transfer of the ownership or security interest in the 1998
Transition Property other than those required to be made by Illinois Power
pursuant to the Basic Documents.
SECTION 4.11. ADDITIONAL NEGATIVE COVENANTS. So long as any Notes are
Outstanding, the Grantee shall not:
(a) except as permitted by Section 5.02, sell, transfer, exchange or
otherwise dispose of any of its properties or assets;
(b) assert any claim against the Note Issuer by reason of the payment
of the taxes levied or assessed upon any part of the 1998 Transition Property
or the Related Assets;
(c) except as permitted by Section 5.02, terminate its existence or
dissolve or liquidate in whole or in part; or
(d) take any action that would be inconsistent with the Note Issuer's
absolute and first priority ownership interest in the 1998 Transition
Property and the Related Assets.
SECTION 4.12. NO OTHER BUSINESS. The Grantee shall not engage in any
business other than acquiring, owning, financing, transferring, assigning and
otherwise managing the 1998 Transition Property and Related Assets, and any
Subsequent Intangible Transition Property and Subsequent Related Assets, in
the manner contemplated by this Agreement and the Basic Documents (or in a
similar manner, in the case of Subsequent Transition Property and Subsequent
Related Assets) and activities incidental thereto.
SECTION 4.13. NO BORROWING. The Grantee shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness.
SECTION 4.14. GUARANTEES LOANS, ADVANCES AND OTHER LIABILITIES. Except
as otherwise contemplated by the Grant Agreement, the Administration
Agreement, the Servicing
17
Agreement or this Agreement, the Grantee shall not make any loan or advance
or credit to, or guarantee (directly or indirectly or by an instrument having
the effect of assuring another's payment or performance on any obligation or
capability of so doing or otherwise), endorse or otherwise become
contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire
(or agree contingently to do so) any stock, obligations, assets or securities
of; or any other interest in, or make any capital contribution to, any other
Person.
SECTION 4.15. CAPITAL EXPENDITURES. Other than expenditures made out
of available funds in an aggregate amount not to exceed $25,000 in any
calendar year, the Grantee shall not make any expenditure (by long- term or
operating lease or otherwise) for capital assets (either realty or
personalty).
SECTION 4.16. NOTICE OF DEFAULTS. The Grantee shall promptly notify
the Note Issuer, in writing, of each default under the Indenture and each
material default on the part of Illinois Power or the Servicer of their
respective obligations under the Grant Agreement or the Servicing
Agreement.
SECTION 4.17. SEPARATE EXISTENCE. The Grantee shall:
(i) Maintain with commercial banking institutions its own
deposit account or accounts separate from those of any Affiliate of
the Grantee. The Grantee's funds will not be diverted to any other
Person or for other than the Grantee's use, and, except as may be
expressly permitted by this Agreement or the Servicing Agreement, the
funds of the Grantee shall not be commingled with those of any
Affiliate of the Grantee.
(ii) Ensure that, to the extent that it shares the same
officers or other employees as any of its members or Affiliates, the
salaries of and the expenses related to providing
18
benefits to such officers and other employees shall be fairly allocated
among such entities, and each such entity shall bear its fair share of the
salary and benefit costs associated with all such common officers and
employees.
(iii) Ensure that, to the extent that it jointly contracts
with any of its members or Affiliates to do business with vendors or
service providers or to share overhead expenses, the costs incurred in
so doing shall be allocated fairly among such entities, and each such
entity shall bear its fair share of such costs. To the extent that
the Grantee contracts or does business with vendors or service
providers where the goods and services provided are partially for the
benefit of any other Person, the costs incurred in so doing shall be
fairly allocated to or among such entities for whose benefit the goods
and services are provided, and each such entity shall bear its fair
share of such costs. All material transactions between the Grantee
and any of its Affiliates shall be only on an arm' s-length basis.
(iv) Maintain a principal executive and administrative office
through which its business is conducted separate from those of its
members and Affiliates. To the extent that the Grantee and any of its
members or Affiliates have offices in contiguous space, there shall be
fair and appropriate allocation of overhead costs among them, and each
such entity shall bear its fair share of such expenses.
(v) Conduct its affairs strictly in accordance with its
Operating Agreement and observe all necessary, appropriate and
customary formalities, including, but not limited to, holding all
regular and special members' meetings, and meetings of the Grantee's
management committee, appropriate to authorize all action on behalf of
the Grantee, keeping all resolutions or consents necessary to
authorize actions taken or to be taken, and
19
maintaining accurate and separate books, records and accounts, including,
but not limited to, payroll and intercompany transaction accounts.
(vi) Ensure that its management committee (a) shall not
include any Person who is also a member of the Board of Directors of
any of the Grantee's Affiliates and (b) shall at all times include at
least two Independent Managers (as such term is defined in the
Grantee's Operating Agreement).
(vii) Act solely in its own name and through its own
authorized managers and agents, and no Affiliate of the Grantee shall
be appointed to act as agent of the Grantee, except as expressly
contemplated by this Agreement or the Servicing Agreement.
(viii) Ensure that no Affiliate of the Grantee shall advance
funds to the Grantee, or otherwise guaranty debts of, the Grantee,
except as provided in the Grantee's Operating Agreement; PROVIDED,
HOWEVER, that an Affiliate of the Grantee may provide funds to the
Grantee in connection with capitalization of the Grantee.
(ix) Not enter into any guaranty, or otherwise become liable,
with respect to any obligation of any Affiliate of the Grantee.
SECTION 4.18. FURTHER INSTRUMENTS AND ACTS. Upon request of the Note
Issuer, the Grantee will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out
more effectively the purposes of this Agreement.
SECTION 4.19. SUBSEQUENT TRANSITION PROPERTY.
(a) Notwithstanding any provision hereof to the contrary, the
Grantee may from time to time accept newly-created Subsequent Transition
Property pursuant to a related Subsequent Funding Order and a Subsequent
Tariff, subject to the conditions specified in paragraph (b) below.
20
(b) The Grantee shall be permitted to accept Subsequent Transition
Property only upon the satisfaction of each of the following conditions on
or prior to the related Subsequent Creation Date:
(i) Illinois Power shall have provided the Grantee, the
Subsequent Note Issuer, the Indenture Trustee and the Rating Agencies
with written notice, which shall be given not later than 10 days prior
to the related Subsequent Creation Date, specifying the Subsequent
Creation Date for such Subsequent Transition Property and the
aggregate amount of the IFCs related to such Subsequent Transition
Property, and shall have provided any information reasonably requested
by any of the foregoing Persons with respect to the Subsequent
Transition Property to be created in favor of the Grantee.
(ii) Illinois Power and the Grantee shall have delivered to
the Note Issuer a duly executed Subsequent Grant Agreement, and the
Grantee shall have delivered to the Note Issuer a duly executed
Subsequent Sale Agreement;
(iii) as of such Subsequent Creation Date, Illinois Power will
not be insolvent and will not have been made insolvent by such
transfer and Illinois Power will not be aware of any pending
insolvency with respect to itself;
(iv) the Rating Agency Condition shall have been satisfied
with respect to such creation;
(v) Illinois Power shall have delivered to the Grantee, the
Note Issuer, the Indenture Trustee and the Delaware Trustee an opinion
of independent tax counsel and/or a ruling from the IRS (as selected
by, and in form and substance reasonably satisfactory to Illinois
Power) to the effect that for federal income tax purposes (i) the
issuance of the Transitional Funding Order authorizing the collection
of the Instrument Funding Charges
21
does not result in gross income to Illinois Power, the Grantee or the
Note Issuer, (ii) the assignment of the Intangible Transition Property
to the Note Issuer and the issuance of the Notes does not result in
gross income to Illinois Power, the Grantee or the Note Issuer, and
(iii) the Notes will be obligations of Illinois Power for federal
income tax purposes;
(vi) as of such Subsequent Creation Date, no breach by
Illinois Power of its representations, warranties or covenants in the
Grant Agreement and no Servicer Default shall exist;
(vii) as of such Subsequent Creation Date, the Grantee shall
have sufficient funds available to pay Illinois Power the
consideration set forth in the Subsequent Grant Agreement, and all
conditions shall have been satisfied for the issuance of one or more
instruments under the Indenture in order to provide such funds;
(viii) the Grantee shall have delivered to the Rating Agencies
any Opinions of Counsel requested by the Rating Agencies;
(ix) the Grantee and the Note Issuer shall have taken all
actions required to perfect the ownership interest or security
interest (as the case may be) of the Note Issuer in the Subsequent
Transition Property and Subsequent Related Assets and the proceeds
thereof; free and clear of any Liens; and
(x) the Grantee shall have delivered to the Note Issuer an
Officer's Certificate confirming the satisfaction of each condition
precedent specified in this paragraph (b).
22
ARTICLE V
THE GRANTEE
SECTION 5.01. LIABILITY OF GRANTEE; INDEMNITIES.
(a) The Grantee shall be liable in accordance herewith only to the
extent of the obligations specifically undertaken by the Grantee under this
Agreement.
(b) The Grantee shall indemnify the Note Issuer, the Indenture
Trustee and the Delaware Trustee, and each of their respective officers,
directors, employees and agents for, and defend and hold harmless each such
Person from and against, any and all taxes (i) that may at any time be
imposed on or asserted against any such Person as a result of the grant of
the 1998 Transition Property to the Grantee, or (ii) that may be imposed on
or asserted against any such Person under existing law as of the Closing
Date as a result of the Grantee's ownership and assignment of the 1998
Transition Property, the Note Issuer's issuance and sale of the Notes, or
the other transactions contemplated herein, including, in each case, any
sales, gross receipt, general corporation, tangible personal property,
privilege or license taxes, but excluding any taxes imposed as a result of
a failure of such Person to withhold or remit taxes imposed with respect to
payments on any Note.
(c) The Grantee shall indemnify the Note Issuer, the Indenture
Trustee, the Delaware Trustee and the Holders and each of their respective
officers, directors, employees and agents for, and defend and hold harmless
each such Person from and against, any and all amounts of principal and
interest on the Notes not paid when due in accordance with their terms and
the amount of any deposits to the Note Issuer required to have been made in
accordance with the terms of the Basic Documents which are not made when so
required and any and all liabilities, obligations, claims, actions, suits,
or payments, of any kind whatsoever that may be imposed on or asserted
against any such Person, together with any reasonable costs and expenses
incurred by such Person (collectively,
23
"Losses"), as a result of the Grantee's breach of any of its representations,
warranties or covenants contained in this Agreement.
(d) The Grantee shall pay any and all taxes levied or assessed upon
all or any part of the Note Issuer's property or assets based on existing
law as of the Closing Date.
(e) Indemnification under this Section 5.01 shall survive the
resignation or removal of the Indenture Trustee or the Delaware Trustee and
the termination of this Agreement and shall include reasonable fees and
expenses of investigation and litigation (including reasonable attorneys'
fees and expenses).
SECTION 5.02. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, GRANTEE. Any Person (a) into which the Grantee may be
merged or consolidated, (b) which may result from any merger or
consolidation to which the Grantee shall be a party or (c) which may
succeed to the properties and assets of the Grantee substantially as a
whole, which Person in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Grantee hereunder, shall be
the successor to the Grantee under this Agreement without further act on
the part of any of the parties to this Agreement; PROVIDED, HOWEVER, that
(i) immediately after giving effect to such transaction, no representation
or warranty made pursuant to Article III shall have been breached, (ii) the
Grantee shall have delivered to the Note Issuer and the Indenture Trustee
an Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply
with this Section and that all conditions precedent, if any, provided for
in this Agreement relating to such transaction have been complied with,
(iii) the Grantee shall have delivered to the Note Issuer and the Indenture
Trustee an Opinion of Counsel either (A) stating that, in the opinion of
such counsel, all filings to be made by the Grantee, including filings with
the ICC pursuant to the Funding Law, have been executed and filed
24
that are necessary to fully preserve and protect the interest of the Note
Issuer in the 1998 Transition Property and Related Assets and reciting the
details of such filings, or (B) stating that, in the opinion of such counsel,
no such action shall be necessary to preserve and protect such interests (iv)
the Rating Agencies shall have received prior written notice of such
transaction and (v) Illinois Power shall have delivered to the Grantee, the
Note Issuer, the Delaware Trustee and the Indenture Trustee an opinion of
independent tax counsel (as selected by, and in form and substance reasonably
satisfactory to, Illinois Power, and which may be based on a ruling from the
Internal Revenue Service) to the effect that, for federal income tax
purposes, such consolidation or merger will not result in a material adverse
federal income tax consequence to Illinois Power, the Grantee, the Note
Issuer, the Delaware Trustee, the Indenture Trustee or the then existing
Holders. Notwithstanding anything herein to the contrary, the execution of
the foregoing agreement of assumption and compliance with clauses (i), (ii),
(iii), (iv) and (v) above shall be conditions to the consummation of any
transaction referred to in clauses (a), (b) or (c) above. When any Person
acquires the properties and assets of Illinois Power Securitization Limited
Liability Company, substantially as a whole and becomes the successor to
Illinois Power Securitization Limited Liability Company in accordance with
the terms of this Section 5.02, then upon the satisfaction of all of the
other conditions of this Section 5.02, Illinois Power Securitization Limited
Liability Company shall automatically and without further notice be released
from its obligations hereunder.
SECTION 5.03. LIMITATION ON LIABILITY OF GRANTEE AND OTHERS. The
Grantee and any director or officer or employee or agent of the Grantee may
rely in good faith on the advice of counsel or on any document of any kind,
PRIMA FACIE properly executed and submitted by any Person, respecting any
matters arising hereunder. Subject to Section 4.07, the Grantee shall not
be under any obligation to appear in, prosecute or defend any legal action
that shall not be incidental
25
to its obligations under this Agreement, and that in its opinion may involve
it in any expense or liability.
ARTICLE VI
MISCELLANEOUS PROVISIONS
SECTION 6.01. AMENDMENT. The Agreement may be amended by the Grantee
and the Note Issuer, with prior written notice given to the Rating Agencies
and the prior written consent of the Indenture Trustee, but without the
consent of any of the Holders, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions in this Agreement or of modifying in any manner the rights of
the Holders; PROVIDED, HOWEVER, that such action shall not, as evidenced by
an Officer's Certificate delivered to the Note Issuer and the Indenture
Trustee, adversely affect in any material respect the interests of any
Holder. This Agreement may also be amended from time to time by the
Grantee and the Note Issuer, with prior written notice given to the Rating
Agencies and the prior written consent of the Indenture Trustee and Holders
holding not less than a majority of the Outstanding Amount of the Notes of
all Series affected thereby, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of the Holders;
PROVIDED, HOWEVER, that no such amendment shall (a) increase or reduce in
any manner the amount of, or accelerate or delay the timing of, IFC
Collections or the timing of adjustments to IFCs or (b) reduce the
aforesaid percentage of the Outstanding Amount of the Notes, the Holders of
which are required to consent to any such amendment, without the consent of
the Holders of all the outstanding Notes.
26
Promptly after the execution of any such amendment or consent, the
Note Issuer shall furnish a copy of such amendment or consent to the
Indenture Trustee and each of the Rating Agencies.
It shall not be necessary for the consent of Holders pursuant to this
Section to approve the particular form of any proposed amendment or
consent, but it shall be sufficient if such consent shall approve the
substance thereof.
Prior to the execution of any amendment to this Agreement, the
Indenture Trustee shall be entitled to receive and rely upon an Opinion of
Counsel stating that the execution of such amendment is authorized or
permitted by this Agreement. The Indenture Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Indenture
Trustee's own rights, duties or immunities under this Agreement or
otherwise.
SECTION 6.02. NOTICES. All demands, notices and communications upon
or to the Grantee, the Note Issuer, the Indenture Trustee or the Rating
Agencies under this Agreement shall be in writing, personally delivered,
mailed or sent by telecopy or other similar form of rapid transmission, and
shall be deemed to have been duly given upon receipt (a) in the case of the
Grantee, Illinois Power Securitization Limited Liability Company, c/o
Illinois Power Company, 000 Xxxxx 00xx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000; (b)
in the case of the Note Issuer, to Illinois Power Special Purpose Trust,
c/o First Union Trust Company, National Association, One Xxxxxx Square, 000
Xxxx Xxxxxx, 0xx Xxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate
Trust Administration, with a copy to Xxxxxxxx, Xxxxxx & Finger, Attention:
Xxxxxxx Xxxxx, (c) in the case of the Indenture Trustee, at the Corporate
Trust Office; (d) in the case of Moody's, to Xxxxx'x Investors Service,
Inc., ABS Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000; (e) in the case of Standard & Poor's, to Standard & Poor's
Corporation, 00 Xxxxxxxx (00xx Xxxxx), Xxx Xxxx, Xxx Xxxx 00000, Attention:
ABS Surveillance; (f) in the case of Fitch IBCA,
27
to Fitch IBCA, Inc., Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: ABS Surveillance; or (g) in the case of Duff & Xxxxxx, to Xxxx &
Xxxxxx Rating Co., 00 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention of Asset Backed Monitoring Group; or as to each of the foregoing,
at such other address as shall be designated by written notice to the other
parties.
SECTION 6.03. ASSIGNMENT. Notwithstanding anything to the contrary
contained herein, except as provided in Section 5.02, this Agreement may
not be assigned by the Grantee.
SECTION 6.04. LIMITATIONS ON RIGHTS OF OTHERS. The provisions of this
Agreement are solely for the benefit of the Grantee, the Note Issuer, the
Indenture Trustee, the Delaware Trustee and the Holders, and nothing in
this Agreement, whether express or implied, shall be construed to give to
any other Person any legal or equitable right, remedy or claim in the 1998
Transition Property or Related Assets or under or in respect of this
Agreement or any covenants, conditions or provisions contained herein.
SECTION 6.05. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof; and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 6.06. SEPARATE COUNTERPARTS. This Agreement may be executed
by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same instrument.
SECTION 6.07. HEADINGS. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define
or limit any of the terms or provisions hereof.
28
SECTION 6.08. GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of Illinois, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
SECTION 6.09. ASSIGNMENT TO INDENTURE TRUSTEE. The Grantee
acknowledges and consents to any transfer, pledge, assignment and grant of
a security interest by the Note Issuer to the Indenture Trustee pursuant to
the Indenture for the benefit of the Holders of all right, title and
interest of the Note Issuer in, to and under the 1998 Transition Property
and Related Assets and the proceeds thereof and the assignment of any or
all of the Note Issuer's rights and obligations hereunder to the Indenture
Trustee.
SECTION 6.10. LIMITATION OF LIABILITY. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed and
delivered by First Union Trust Company, National Association ("First
Union") not individually or personally but solely as Delaware Trustee on
behalf of the Note Issuer, in the exercise of the powers and authority
conferred and vested in it, (b) the representations, undertakings and
agreements herein made by the Delaware Trustee on behalf of the Note Issuer
are made and intended not as personal representations, undertakings and
agreements by First Union are made and intended for the purpose of binding
only the Note Issuer, (c) nothing herein contained shall be construed as
creating any liability on First Union individually or personally, to
perform any covenant either expressed or implied contained herein, all such
liability, if any, being expressly waived by the parties who are
signatories to this Agreement and by any Person claiming by, through or
under such parties and (d) under no circumstances shall First Union be
personally liable for the payment of any indebtedness or expense of the
Note Issuer or be
29
personally liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Note Issuer
under this Agreement.
SECTION 6.11. LIMITATION OF LIABILITY. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed and
delivered by Xxxxxx Trust and Savings Bank, not individually or personally
but solely as Indenture Trustee, in the exercise of the powers and
authority conferred and vested in it, and (b) nothing herein contained
shall be construed as creating any liability on Xxxxxx Trust and Savings
Bank, individually or personally, to perform any covenant either expressed
or implied contained herein, all such liability, if any, being expressly
waived by the parties who are signatories to this Agreement and by any
person claiming by, through or under such parties.
SECTION 6.12. HOLDERS AS THIRD-PARTY BENEFICIARIES. The Grantee and
the Note Issuer agree that the Holders and the Indenture Trustee are
express third-party beneficiaries of the provisions of this Agreement and
that the Indenture Trustee, on behalf of the Holders, shall have the right
to enforce the terms hereof as provided in Section 6.09 hereof. The
Grantee will take all appropriate actions to perfect and maintain the
perfection of the Grantee's and the Note Issuer's ownership interest in any
of the 1998 Transition Property and to perfect and maintain the perfection
of the Indenture Trustee's security interest in such 1998 Transition
Property and all other Note Collateral.
SECTION 6.13. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. In addition
to the survival of representations and warranties as set forth in Article
III, (a) the agreements, representations warranties, indemnities and other
statements of the Grantee set forth in or made pursuant to this Agreement
will remain in full force and effect and will survive the grant of the 1998
Transition Property and the issuance and delivery of the Notes and (b) to
the fullest extent permitted by
30
applicable law, the provisions of Articles III, IV and V hereof shall survive
the termination and cancellation or invalidity of this Agreement.
7
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers as of the day and year first
above written.
ILLINOIS POWER SECURITIZATION
LIMITED LIABILITY COMPANY, Grantee
By: Xxxx X. Xxxxxx
-----------------------------
Name: Xxxx X. Xxxxxx
Title: Manager
ILLINOIS POWER SPECIAL PURPOSE
TRUST, Note Issuer
By: FIRST UNION TRUST
COMPANY, NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Delaware Trustee
By: /s/ Xxxxx X. Xxxxx
----------------------------
Name: Xxxxx X. Xxxxx
----------------------------
Title: Vice President
----------------------------
Acknowledged and accepted:
XXXXXX TRUST AND SAVINGS BANK,
not in its individual capacity
but solely as Indenture
Trustee
By: /s/ E. Xxx Xxxxxxxxx
-----------------------------
Name: E. Xxx Xxxxxxxxx
-----------------------------
Title: Vice President
-----------------------------
31
