EXHIBIT 10.1
SALE AGREEMENT
BONDABLE TRANSITION PROPERTY SALE AGREEMENT
between
PSE&G TRANSITION FUNDING LLC
Issuer
and
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
Seller
Dated as of January 31, 2001
TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.01 Definitions....................................................................1
SECTION 1.02 Other Definitional Provisions..................................................1
ARTICLE II
Conveyance of Transferred Bondable Transition Property
SECTION 2.01 Conveyance of Initial Transferred Bondable Transition Property.................2
SECTION 2.02 Conditions to Conveyance of Bondable Transition Property.......................3
ARTICLE III
Representations and Warranties of Seller
SECTION 3.01 Organization and Good Standing.................................................5
SECTION 3.02 Due Qualification..............................................................5
SECTION 3.03 Power and Authority............................................................5
SECTION 3.04 Binding Obligation.............................................................6
SECTION 3.05 No Violation...................................................................6
SECTION 3.06 No Proceedings.................................................................6
SECTION 3.07 Approvals......................................................................6
SECTION 3.08 The Transferred Bondable Transition Property...................................7
SECTION 3.09 Solvency.......................................................................9
ARTICLE IV
Covenants of the Seller
SECTION 4.01 Seller's Existence............................................................10
SECTION 4.02 No Liens or Conveyances.......................................................10
SECTION 4.03 Use of Proceeds. ............................................................10
SECTION 4.04 Delivery of Collections.......................................................10
SECTION 4.05 Notice of Liens...............................................................11
SECTION 4.06 Compliance with Law...........................................................11
SECTION 4.07 Covenants Related to Transferred Bondable Transition Property.................11
SECTION 4.08 Protection of Title...........................................................12
SECTION 4.09 Taxes.........................................................................13
ARTICLE V
Additional Undertakings of the Seller
SECTION 5.01 Liability of the Seller; Indemnities..........................................13
SECTION 5.02 Merger or Consolidation of, or Assumption of the Obligations of, the Seller...14
SECTION 5.03 Limitation on Liability of the Seller and Others..............................16
ARTICLE VI
Miscellaneous Provisions
SECTION 6.01 Amendment.....................................................................16
SECTION 6.02 Notices.......................................................................16
SECTION 6.03 Assignment by Seller..........................................................17
SECTION 6.04 Assignment to Trustee.........................................................17
SECTION 6.05 Limitations on Rights of Others...............................................17
SECTION 6.06 Severability..................................................................17
SECTION 6.07 Separate Counterparts.........................................................18
SECTION 6.08 Headings......................................................................18
SECTION 6.09 Governing Law.................................................................18
SECTION 6.10 Nonpetition Covenant..........................................................18
EXHIBIT A - Xxxx of Sale...................................................................A-1
EXHIBIT B - Opinion of Counsel.............................................................B-1
EXHIBIT C - Opinion of Counsel.............................................................C-1
APPENDIX A - Master Definitions
BONDABLE TRANSITION PROPERTY SALE AGREEMENT, dated as of
January 31, 2001, by and between PSE&G TRANSITION FUNDING LLC, a Delaware
limited liability company, as issuer (the "Issuer"), and PUBLIC SERVICE
ELECTRIC AND GAS COMPANY, a New Jersey corporation, as seller hereunder (in
such capacity, the "Seller").
W I T N E S S E T H:
WHEREAS the Issuer desires to purchase from time to time
Bondable Transition Property created pursuant to the Competition Act and
the Financing Order;
WHEREAS the Seller is willing to sell Bondable Transition
Property to the Issuer;
WHEREAS the Issuer, in order to finance the purchase of the
Transferred Bondable Transition Property, will from time to time issue
Transition Bonds under the Indenture; and
WHEREAS the Issuer, to secure its obligations under the
Transition Bonds and the Indenture, will pledge its right, title and
interest in, to and under the Transferred Bondable Transition Property to
the Trustee for the benefit of the Transition Bondholders.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, 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 Appendix
A hereto.
SECTION 1.02 OTHER DEFINITIONAL PROVISIONS.
(a) "Agreement" means this Bondable 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 Competition Act, as the context requires, have the meanings assigned to
such terms in the Competition Act, but without giving effect to amendments
to the Competition Act after the date hereof which have a material adverse
effect on the Issuer or the Transition Bondholders.
(c) All terms defined in this Agreement have the defined
meanings 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 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" means "including without
limitation".
(e) The definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms.
ARTICLE II
CONVEYANCE OF TRANSFERRED BONDABLE TRANSITION PROPERTY
SECTION 2.01 CONVEYANCE OF INITIAL TRANSFERRED BONDABLE
TRANSITION PROPERTY.
(a) In consideration of the Issuer's payment to or upon the
order of the Seller of $2,525,000,000, net of the underwriting discount,
original issue discount and the financial advisory fee for the Transition
Bonds in the aggregate amount of $14,439,091.21, or $2,510,560,908.79 (the
"Initial Purchase Price") by wire transfer of funds immediately available
on the date hereof to Seller's account no. D/5000000016439 for further
credit to account no. 576010933 at First Union National Bank, Charlotte,
NC, routing transit ABA# 05300219, subject to the conditions specified in
Section 2.02, the Seller does hereby irrevocably sell, transfer, assign and
otherwise convey to the Issuer, without recourse (subject to the
obligations of the Seller herein), all right, title and interest of the
Seller in, to and under the Initial Transferred Bondable Transition
Property identified in the Xxxx of Sale delivered pursuant to Section
2.02(a) on or prior to the Initial Transfer Date (such sale, transfer,
assignment and conveyance of the Initial Transferred Bondable Transition
Property to include, to the fullest extent permitted by the Competition Act
and the New Jersey UCC, the assignment of all revenues, collections,
claims, rights, payments, money or proceeds of or arising from the
Transition Bond Charges related to the Initial Transferred Bondable
Transition Property, as the same may be adjusted from time to time). Such
sale, transfer, assignment and conveyance of the Initial Transferred
Bondable Transition Property is hereby expressly stated to be a sale or
other absolute transfer and, pursuant to Section 23.a. of the Competition
Act, shall constitute a sale or other absolute transfer of all of the
Seller's right, title and interest, in, to and under and not a borrowing
secured by, the Initial Transferred Bondable Transition Property. The
preceding sentence is the statement referred to in Section 23.a. of the
Competition Act. The Seller agrees and confirms that upon payment of the
Initial Purchase Price and the execution and delivery of this Agreement and
the related Xxxx of Sale, the Seller shall have no right, title or interest
in, to or under the Initial Transferred Bondable Transition Property.
(b) Subject to the conditions specified in Section 2.02, the
Issuer does hereby purchase the Initial Transferred Bondable Transition
Property from the Seller for the consideration set forth in paragraph (a)
above.
(c) The Seller and the Issuer each acknowledge and agree
that the purchase price for the Initial Transferred Bondable Transition
Property sold pursuant to this Agreement is equal to its fair market value
at the time of sale.
(d) The Seller and the Issuer further agree that from time
to time the Seller may offer to sell, and the Issuer may purchase,
Subsequent Transferred Bondable Transition Property as of Subsequent
Transfer Dates, subject to the conditions specified in Section 2.02, in
exchange for consideration to be agreed upon (the "Subsequent Purchase
Price"). The Seller and the Issuer hereby agree that each such sale,
transfer, assignment and conveyance of any Subsequent Transferred Bondable
Transition Property shall include, to the fullest extent permitted by the
Competition Act and the New Jersey UCC, the assignment of all revenues,
collections, claims, rights, payments, money or proceeds of or arising from
the Transition Bond Charges related to the Subsequent Transferred Bondable
Transition Property, as the same may be adjusted from time to time. Such
sale, transfer, assignment and conveyance of the Subsequent Transferred
Bondable Transition Property is hereby expressly stated to be a sale or
other absolute transfer and, pursuant to Section 23.a. of the Competition
Act, shall constitute a sale or other absolute transfer of all of the
Seller's right, title and interest, in, to and under and not a borrowing
secured by, the Subsequent Transferred Bondable Transition Property. The
preceding sentence is the statement referred to in Section 23.a. of the
Competition Act. The Seller agrees and confirms that after giving effect to
any sale contemplated by this paragraph (d) and the execution and delivery
of the related Xxxx of Sale, it shall have no right, title or interest in,
to or under the Subsequent Transferred Bondable Transition Property.
(e) Notwithstanding the foregoing, in the event that any
sale, transfer, assignment and conveyance of any Transferred Bondable
Transition Property is determined by a court of competent jurisdiction not
to be a true and absolute sale as contemplated by the parties hereto and by
the Competition Act, then such sale, transfer, assignment and conveyance
shall be treated as a pledge of such Transferred Bondable Transition
Property and the Seller shall be deemed to have granted, and does hereby
grant, as of the date hereof a security interest to the Issuer in such
Transferred Bondable Transition Property to secure a payment obligation
incurred by the Seller in the amount paid by the Issuer for the Transferred
Bondable Transition Property.
SECTION 2.02 CONDITIONS TO CONVEYANCE OF BONDABLE TRANSITION
PROPERTY. The obligation of the Seller to sell, and the obligation of the
Issuer to purchase Bondable Transition Property upon any Transfer Date
shall be subject to and conditioned upon the satisfaction or waiver of each
of the following conditions:
(a) on or prior to the Transfer Date, the Seller shall
deliver to the Issuer a duly executed Xxxx of Sale identifying the Bondable
Transition Property to be conveyed as of that date, substantially in the
form of Exhibit A hereto;
(b) as of the Transfer Date, no breach by the Seller of its
representations, warranties or covenants in this Agreement shall exist and
the Seller shall have delivered to the Issuer and the Trustee an Officers'
Certificate to such effect and no Servicer Default shall have occurred and
be continuing;
(c) as of the Transfer Date:
(i) the Issuer shall have sufficient funds available
to pay the purchase price for the Transferred Bondable Transition
Property to be conveyed on such date, and
(ii) all conditions set forth in the Indenture to the
issuance of one or more Series of Transition Bonds intended to
provide such funds shall have been satisfied or waived;
(d) on or prior to the Transfer Date, the Seller shall have
taken all actions required under the Competition Act, the Financing Order
and the New Jersey UCC, including, without limitation, filings under the
New Jersey UCC, to transfer to the Issuer ownership of the Transferred
Bondable Transition Property to be conveyed on such date, free and clear of
all Liens other than Liens created by the Issuer pursuant to the Indenture
and the Issuer shall have taken any action required for the Issuer to grant
to the Trustee a first priority perfected security interest in the
Collateral and maintain such security interest as of such date, including,
without limitation, filings under the New Jersey UCC;
(e) in the case of any sale of Subsequent Transferred
Bondable Transition Property only, the Seller shall have provided the
Issuer and each Rating Agency with a notice specifying the Subsequent
Transfer Date for the Subsequent Transferred Bondable Transition Property
not later than 10 days prior to the Subsequent Transfer Date;
(f) the Seller shall have delivered to each Rating Agency
and to the Issuer:
(i) an Opinion of Counsel to the Seller with respect
to the transfer of the Transferred Bondable Transition Property
then being conveyed to the Issuer substantially in the form of
Exhibit B hereto, and
(ii) an Opinion of Counsel to the Seller, substantially
in the form of Exhibit C hereto;
(g) the Seller shall have delivered to the Trustee and the
Issuer an Officers' Certificate confirming the satisfaction of each
condition precedent specified in this Section 2.02;
(h) with respect to any Subsequent Sale, the Seller shall
have taken any action necessary in order for the Rating Agency Condition to
have been satisfied; and
(i) the Seller shall have received the Initial Purchase
Price or the Subsequent Purchase Price, as applicable, in funds immediately
available on the applicable Transfer Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
As of the Transfer Date, the Seller makes the following
representations and warranties on which the Issuer has relied and will rely
in acquiring Transferred Bondable Transition Property. The following
representations and warranties are made under existing law as in effect as
of the Transfer Date. The Seller shall not be in breach of any
representation or warranty herein as a result of a change in law occurring
after the Transfer Date. The representations and warranties shall survive
the sale of Transferred Bondable Transition Property to the Issuer and the
pledge thereof to the Trustee pursuant to the Indenture.
SECTION 3.01 ORGANIZATION AND GOOD STANDING. The Seller is a
corporation duly organized and in good standing under the laws of the State
of New Jersey, with corporate power and authority to own its properties and
conduct its business as currently owned or conducted.
SECTION 3.02 DUE QUALIFICATION. The Seller is duly qualified
to do business as a foreign corporation 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 requires such
qualifications, licenses or approvals (except where the failure to so
qualify and to obtain such licenses and approvals would not be reasonably
likely to have a material adverse effect on the Seller's business,
operations, assets, revenues, properties or prospects).
SECTION 3.03 POWER AND AUTHORITY. The Seller has the
corporate power and authority to execute and deliver this Agreement and to
carry out its terms; the Seller has full corporate power and authority to
own the Bondable Transition Property and sell and assign the Transferred
Bondable Transition Property to the Issuer, and the Seller has duly
authorized such sale and assignment to the Issuer by all necessary
corporate action; and the execution, delivery and performance of this
Agreement has been duly authorized by the Seller by all necessary corporate
action.
SECTION 3.04 BINDING OBLIGATION. This Agreement constitutes
a legal, valid and binding obligation of the Seller enforceable against the
Seller in accordance with its terms subject to bankruptcy, receivership,
insolvency, reorganization, moratorium or other laws affecting creditors'
rights generally from time to time in effect and to general principles of
equity (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 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 articles of incorporation or by-laws of the Seller, or
any indenture, agreement or other instrument to which the Seller is a party
or by which it is bound; nor 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 (except as contemplated by the
Basic Documents and as set forth in Section 2.01(e) hereof); nor violate
any law or any order, rule or regulation applicable to the Seller of any
court or of any federal or State regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Seller or
its properties. The Bondable Transition Property is not subject to any Lien
thereon created by the indenture, dated August 1, 1924 (as amended and
supplemented by 95 supplemental indentures), of Public Service Electric and
Gas Company to Fidelity Union Trust Company, as successor trustee.
SECTION 3.06 NO PROCEEDINGS. Except as disclosed in the
prospectus and the related prospectus supplement, each dated January 25,
2001, of PSE&G Transition Funding LLC, relating to the Transition Bonds,
(together, the "Prospectus") there are no proceedings or investigations
pending or, to the Seller's best knowledge, threatened, before any court,
federal or State regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Seller or its
properties:
(a) asserting the invalidity of the Basic Documents, the
Transition Bonds, the Competition Act, the Restructuring Order (insofar as
it relates to the transactions contemplated hereby) or the Financing Order;
(b) seeking to prevent the issuance of the Transition Bonds
or the consummation of any of the transactions contemplated by the Basic
Documents or the Transition Bonds;
(c) challenging the Seller's treatment of the Transition
Bonds as debt of the Seller for federal and State income, gross receipts or
franchise tax purposes; or
(d) seeking any determination or ruling that could
reasonably be expected to materially and adversely affect the performance
by the Seller of its obligations under, or the validity or enforceability
of, the Basic Documents or the Transition Bonds.
SECTION 3.07 APPROVALS. Except for the filing of financing
statements and continuation statements under the New Jersey UCC, 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 execution
and delivery by the Seller of this Agreement, the performance by the Seller
of the transactions contemplated hereby or the fulfillment by the Seller of
the terms hereof, except those that have been obtained or made. The Pricing
Advice Certificate (as defined in the Financing Order) has been filed in
accordance with the Financing Order and is final and incontestable in
accordance with its terms.
SECTION 3.08 THE TRANSFERRED BONDABLE TRANSITION PROPERTY.
(a) Information. All information provided by the Seller to
the Issuer with respect to the Transferred Bondable Transition Property is
correct in all material respects.
(b) Effect of Transfer. Each sale, transfer, assignment and
conveyance herein contemplated constitutes a sale or other absolute
transfer, of all right, title and interest of the Seller in, to and under
the Transferred Bondable Transition Property from the Seller to the Issuer;
upon execution and delivery of this Agreement and the related Xxxx of Sale,
the Seller will have no right, title or interest in, to or under the
Transferred Bondable Transition Property; and the Transferred Bondable
Transition Property would not be part of the estate of the Seller as debtor
in the event of the filing of a bankruptcy petition by or against the
Seller under any bankruptcy law.
(c) Transfer Filings. The Seller is the sole owner of the
Transferred Bondable Transition Property sold to the Issuer on the Transfer
Date; and the Transferred Bondable Transition Property will have been
validly sold, assigned, transferred and conveyed to the Issuer free and
clear of all Liens other than Liens created by the Issuer pursuant to the
Indenture. All actions or filings, including filings with the New Jersey
Division of Revenue/Office of Commercial Recording under the New Jersey
UCC, necessary in any jurisdiction to give the Issuer a valid first
priority perfected ownership interest in the Transferred Bondable
Transition Property and to grant to the Trustee a first priority perfected
security interest in the Transferred Bondable Transition Property, free and
clear of all Liens of the Seller or anyone else have been taken or made.
(d) Financing Order Irrevocable; Process Valid; No
Litigation; Etc.
(i) The Financing Order as issued on September 17,
1999 has been issued by the BPU in accordance with the Competition
Act, and such order and the process by which it was issued comply
with all applicable laws, rules and regulations, including but not
limited to the due process requirements of the United States
Constitution and the New Jersey Constitution. The Financing Order
has become effective pursuant to the Competition Act and is and as
of the date of issuance of any Transition Bonds will be in full
force and effect and final and non-appealable.
(ii) As of the Series Issuance Date, the Transition
Bonds of the related Series will be entitled to the protections
provided by the Competition Act and, in accordance with the
Competition Act, the Financing Order and the Transition Bond Charge
authorized therein have become irrevocable and each Advice Letter
is final and uncontestable.
(iii) (A) Under the Competition Act, the State of New
Jersey may not limit, alter or impair the Transferred
Bondable Transition Property or other rights vested in the
Seller, the Issuer, the Trustee or the Transition
Bondholders pursuant to the Financing Order until the
Transition Bonds are fully paid and discharged, or in any
way limit, alter, impair or reduce the value or amount of
the Transferred Bondable Transition Property; and
(B) under the Contract Clauses of the United
States Constitution and the New Jersey Constitution, the
State of New Jersey, including the BPU, could not
constitutionally take any action of a legislative character,
including the repeal or amendment of the Competition Act,
which would substantially limit, alter or impair the
Bondable Transition Property or other rights vested in the
Transition Bondholders pursuant to the Financing Order, or
substantially limit, alter, impair or reduce the value or
amount of the Bondable Transition Property, unless such
action is a reasonable exercise of the State of New Jersey's
sovereign powers and of a character reasonable and
appropriate to the public purpose justifying such action and
under the Takings Clauses of the United States and New
Jersey Constitutions, the State of New Jersey could not
repeal or amend the Competition Act or take any other action
in contravention of its pledge and agreement quoted above
without paying just compensation to the Transition
Bondholders, as determined by a court of competent
jurisdiction, if doing so would constitute a permanent
appropriation of a substantial property interest of the
Transition Bondholders in the Bondable Transition Property
and deprive the Transition Bondholders of their reasonable
expectations arising from their investments in the
Transition Bonds. There is no assurance, however, that, even
if a court were to award just compensation, it would be
sufficient to pay the full amount of principal of and
interest on the Transition Bonds.
(iv) There is no order by any court providing for the
revocation, alteration, limitation or other impairment of the
Competition Act, the Financing Order, the Restructuring Order
(insofar as it relates to the sale of the Transferred Bondable
Transition Property), any Advice Letter, the Transferred Bondable
Transition Property or the Transition Bond Charge or any rights
arising under any of them or to enjoin the performance of any
obligations under the Financing Order.
(v) 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 creation or
transfer of the Transferred Bondable Transition Property, except
those that have been obtained or made.
(vi) Except as disclosed in the Prospectus, there are
no proceedings or investigations pending, or to the best of the
Seller's knowledge, threatened before any court, federal or State
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or the Issuer
or their respective properties challenging the Competition Act, the
Financing Order or the Restructuring Order (insofar as it relates
to the sale of the Transferred Bondable Transition Property).
(e) Assumptions. The assumptions used in calculating the
Transition Bond Charge in any Advice Letter delivered by the Issuer to the
BPU pursuant to the Financing Order are reasonable and made in good faith.
(f) Creation of Transferred Bondable Transition Property.
(i) For purposes of the Competition Act and the UCC,
the Transferred Bondable Transition Property constitutes presently
existing property;
(ii) the Bondable Transition Property consists of (A)
the irrevocable right of the Seller to charge, collect and receive,
and be paid from collections of, the Transition Bond Charge in the
amount necessary to provide for the full recovery of the Bondable
Stranded Costs which have been determined to be recoverable in the
Financing Order and (B) all rights of the Seller under the
Financing Order, including, without limitation, all rights to
obtain periodic adjustments of the Transition Bond Charge pursuant
to the Competition Act, and all revenues, collections, payments,
money and proceeds arising under, or with respect to, all of the
foregoing; and
(iii) the Financing Order, including the right to
collect the Transition Bond Charge, has become irrevocable.
(g) Prospectus. As of the date hereof, the information
describing the Seller under the caption "The Seller and Servicer of the
Bondable Transition Property" in the prospectus dated January 25, 2001
relating to the Transition Bonds is correct in all material respects.
SECTION 3.09 SOLVENCY. After giving effect to the sale of
any Transferred Bondable Transition Property hereunder, the Seller:
(a) is solvent and expects to remain solvent;
(b) is adequately capitalized to conduct its business and
affairs considering its size and the nature of its business and intended
purposes;
(c) is not engaged in nor does it expect to engage in a
business for which its remaining property represents an unreasonably small
capital;
(d) reasonably believes that it will be able to pay its
debts as they come due; and
(e) is able to pay its debts as they mature and does not
intend to incur, or believes that it will incur, indebtedness that it will
not be able to repay at its maturity.
ARTICLE IV
COVENANTS OF THE SELLER
SECTION 4.01 SELLER'S EXISTENCE. So long as any of the
Transition Bonds are outstanding, the Seller shall keep in full force and
effect its existence as a corporation and remain in good standing under the
laws of the jurisdiction of its organization, and shall obtain and preserve
its qualification to do business in each jurisdiction in which such
qualification is or will be necessary to protect the validity and
enforceability of this Agreement and each other instrument or agreement to
which the Seller is a party necessary to the proper administration of this
Agreement and the transactions contemplated hereby.
SECTION 4.02 NO LIENS OR CONVEYANCES. Except for the
conveyances hereunder, the Seller shall not sell, pledge, assign or
transfer to any other Person, or grant, create, incur, assume or suffer to
exist any Lien on, any of the Transferred Bondable Transition Property,
whether now existing or hereafter created, or any interest therein. The
Seller shall not at any time assert any Lien against or with respect to any
Transferred Bondable Transition Property, and shall defend the right, title
and interest of the Issuer and the Trustee, as assignee of the Issuer, in,
to and under the Transferred Bondable Transition Property, whether now
existing or hereafter created, against all claims of third parties claiming
through or under the Seller.
SECTION 4.03 USE OF PROCEEDS. The Seller shall use proceeds
from the sale of the Bondable Transition Property in accordance with the
Financing Order and the Competition Act.
SECTION 4.04 DELIVERY OF COLLECTIONS. If the Seller receives
collections of the Transition Bond Charge with respect to the Transferred
Bondable Transition Property or the proceeds thereof, the Seller shall pay
the Servicer all payments received by the Seller in respect thereof as soon
as practicable after receipt thereof by the Seller, but in no event later
than two Business Days after such receipt.
SECTION 4.05 NOTICE OF LIENS. The Seller shall notify the
Issuer and the Trustee promptly after becoming aware of any Lien on any
Transferred Bondable Transition Property other than the conveyances
hereunder or under the Indenture.
SECTION 4.06 COMPLIANCE WITH LAW. The Seller shall comply
with its organizational or governing documents and all laws, treaties,
rules, regulations and determinations of any governmental instrumentality
applicable to the Seller, except to the extent that failure to so comply
would not adversely affect the Issuer's or the Trustee's interests in the
Transferred Bondable Transition Property or under any of the Basic
Documents or the Seller's performance of its obligations hereunder.
SECTION 4.07 COVENANTS RELATED TO TRANSFERRED BONDABLE
TRANSITION PROPERTY.
(a) So long as any of the Transition Bonds are outstanding,
the Seller shall:
(i) treat the Transition Bonds as debt of the Issuer
and not of the Seller, except for financial accounting or tax
reporting purposes;
(ii) disclose in its financial statements that it is
not the owner of the Transferred Bondable Transition Property and
that the assets of the Issuer are not available to pay creditors of
the Seller or any of its Affiliates (other than the Issuer);
(iii) disclose the effects of all transactions
between the Seller and the Issuer in accordance with generally
accepted accounting principles; and
(iv) not own or purchase any Transition Bonds.
(b) The Seller agrees that upon the sale by the Seller of
the Transferred Bondable Transition Property to the Issuer pursuant to this
Agreement:
(i) to the fullest extent permitted by law, including
the Competition Act and applicable BPU Regulations, the Issuer
shall have all of the rights originally held by the Seller with
respect to the Transferred Bondable Transition Property, including
the right to collect any amounts payable by any Customer or Third
Party in respect of such Transferred Bondable Transition Property,
notwithstanding any objection or direction to the contrary by the
Seller; and
(ii) any payment by any Customer or Third Party to
the Issuer shall discharge such Customer's or such Third Party's
obligations in respect of such Transferred Bondable Transition
Property to the extent of such payment, notwithstanding any
objection or direction to the contrary by the Seller.
(c) So long as any of the Transition Bonds are Outstanding,
(i) in all proceedings relating directly or
indirectly to the Transferred Bondable Transition Property the
Seller shall: (A) affirmatively certify and confirm that it has
sold the Transferred Bondable Transition Property to the Issuer
(other than for financial accounting or tax reporting purposes),
and (B) not make any statement or reference in respect of the
Transferred Bondable Transition Property that is inconsistent with
the ownership thereof by the Issuer (other than for financial
accounting or tax reporting purposes); and
(ii) the Seller shall not take any action in respect
of the Transferred Bondable Transition Property except as
contemplated by the Basic Documents.
SECTION 4.08 PROTECTION OF TITLE. The Seller shall execute
and file such filings, and cause to be executed and filed such filings, and
take all such actions, all in such manner and in such places as may be
required by law fully to preserve, maintain, and protect the interests of
the Issuer and the Trustee in the Transferred Bondable Transition Property,
including all filings required under the New Jersey UCC relating to the
transfer of the ownership of the Transferred Bondable Transition Property
by the Seller to the Issuer and the pledge of the Transferred Bondable
Transition Property by the Issuer to the Trustee. The Seller shall deliver
(or cause to be delivered) to the Issuer and the Trustee file-stamped
copies of, or filing receipts for, any document filed as provided above, as
soon as available following such filing. The Seller shall institute any
action or proceeding necessary to compel the performance by the BPU or the
State of New Jersey of any of their obligations or duties under the
Competition Act or the Financing Order, and the Seller 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, in each case as may be reasonably necessary:
(a) to protect the Issuer and the Transition Bondholders 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;
or
(b) to block or overturn any attempts to cause a repeal of,
modification of or supplement to the Competition Act, the
Financing Order, any Advice Letter, the Restructuring Order
(to the extent it affects the rights of Transition
Bondholders or the validity or value of the Bondable
Transition Property) or the rights of Transition Bondholders
by legislative enactment or constitutional amendment that
would be adverse to the Issuer, the Trustee or the
Transition Bondholders.
The costs of any such actions or proceedings shall be reimbursed by the
Issuer to the Seller from amounts on deposit in the Collection Account as
an Operating Expense. The Seller's obligations pursuant to this Section
4.08 shall survive and continue notwithstanding that the payment of
Operating Expenses pursuant to the Indenture may be delayed (it being
understood that the Seller may be required to advance its own funds to
satisfy its obligation hereunder). The Seller designates the Issuer as its
agent and attorney-in-fact to execute any filings of financing statements,
continuation statements or other instruments required of the Issuer
pursuant to this Section, it being understood that the Issuer shall have no
obligation to execute any such instruments.
SECTION 4.09 TAXES. So long as any of the Transition Bonds
are outstanding, the Seller 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 Transferred Bondable Transition
Property; provided that no such tax need be paid if the Seller or one of
its Affiliates is contesting the same in good faith by appropriate
proceedings promptly instituted and diligently conducted and if the Seller
or such Affiliate has established appropriate reserves as shall be required
in conformity with generally accepted accounting principles.
ARTICLE V
ADDITIONAL UNDERTAKINGS OF THE SELLER
The Seller hereby undertakes the obligations contained in
this Article V and agrees that the Issuer shall have the right to assign
its rights with respect to such obligations to the Trustee for the benefit
of the Transition Bondholders.
SECTION 5.01 LIABILITY OF THE SELLER; INDEMNITIES.
(a) The Seller shall be liable in accordance herewith only
to the extent of the obligations specifically undertaken by the Seller
under this Agreement.
(b) The Seller shall indemnify the Issuer and the Trustee,
for itself and on behalf of the Transition Bondholders, and each of their
respective officers, directors, managers, employees and agents for, and
defend and hold harmless each such Person from and against, any and all
taxes (other than any taxes imposed on Transition Bondholders solely as a
result of their ownership of Transition Bonds) that may at any time be
imposed on or asserted against any such Person under existing law as of any
Transfer Date as a result of the sale and assignment of the Transferred
Bondable Transition Property by the Seller to the Issuer, the acquisition
or holding of the Transferred Bondable Transition Property by the Issuer or
the issuance and sale by the Issuer of the Transition Bonds, including any
sales, gross receipts, general corporation, personal property, privilege,
franchise or license taxes, but excluding any taxes imposed as a result of
a failure of such person to properly withhold or remit taxes imposed with
respect to payments on any Transition Bond, it being understood that the
Transition Bondholders shall be entitled to enforce their rights against
the Seller under this Section 5.01(b) solely through a cause of action
brought for their benefit by the Trustee.
(c) The Seller shall indemnify the Issuer and the Trustee,
for itself and on behalf of the Transition Bondholders, and each of their
respective officers, directors, managers, employees and agents for, and
defend and hold harmless each such Person from and against, (i) any and all
amounts of principal of and interest on the Transition Bonds (including
amounts owed to Holders of any floating rate Transition Bonds at the Gross
Fixed Rate) not paid when due or when scheduled to be paid in accordance
with their terms and the amount of any deposits to the Issuer required to
have been made in accordance with the terms of the Basic Documents which
are not made when so required, in each case as a result of the Seller's
breach of any of its representations, warranties or covenants contained in
this Agreement, and (ii) 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, other than any liabilities, obligations
or claims for or payments of principal of or interest on the Transition
Bonds, together with any reasonable costs and expenses incurred by such
Person, as a result of the Seller's breach of any of its representations,
warranties or covenants contained in this Agreement.
(d) The Seller shall pay any and all taxes levied or
assessed upon all or any part of the Issuer's property or assets based on
existing law as of the Transfer Date.
(e) Indemnification under this Section 5.01 shall survive
the resignation or removal of the Trustee and the termination of this
Agreement and shall include reasonable fees and expenses of investigation
and litigation (including reasonable attorneys' fees and expenses). The
Seller shall not indemnify any party under this Section 5.01 for any
changes in law after the Transfer Date.
(f) The indemnification obligation of the Seller under this
Section 5.01 shall be pari passu with all other general unsecured
obligations of the Seller.
SECTION 5.02 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF
THE OBLIGATIONS OF, THE SELLER. Any Person:
(a) into which the Seller may be merged or consolidated and
which succeeds to all or the major part of the electric
distribution business of the Seller,
(b) which results from the division of the Seller into two or
more Persons and which succeeds to all or the major part of
the electric distribution business of the Seller,
(c) which may result from any merger or consolidation to which
the Seller shall be a party and which succeeds to all or the
major part of the electric distribution business of the
Seller,
(d) which may succeed to the properties and assets of the Seller
substantially as a whole and which succeeds to all or the
major part of the electric distribution business of the
Seller, or
(e) which may otherwise succeed to all or the major part of the
electric distribution business of the Seller,
which Person in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Seller under this Agreement,
shall be the successor to the Seller hereunder without the execution or
filing of any document or any further act by 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 and no Servicer Default, and no
event that, after notice or lapse of time, or both, would
become a Servicer Default, shall have occurred and be
continuing,
(ii) the Seller shall have delivered to the Issuer and the
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
5.02 and that all conditions precedent, if any, provided for
in this Agreement relating to such transaction have been
complied with,
(iii) the Seller shall have delivered to the Issuer and the
Trustee an Opinion of Counsel either
(A) stating that, in the opinion of such counsel, all
filings to be made by the Seller, including New
Jersey UCC filings, that are necessary fully to
preserve and protect fully the respective interests
of the Issuer and the Trustee in the Transferred
Bondable Transition Property have been executed and
filed, and reciting the details of such filings, or
(B) stating that, in the opinion of such counsel, no such
action is necessary to preserve and protect such
interests,
(iv) the Rating Agencies shall have received prior written notice
of such transaction; and
(v) the Seller shall have delivered to the Issuer and the
Trustee an opinion of independent tax counsel (as selected
by, and in form and substance reasonably satisfactory to,
the Seller, 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 the Seller, the Issuer, the Trustee or the holders of the
Outstanding Transition Bonds.
The Seller shall not consummate any transaction referred to in clauses (a),
(b), (c), (d) or (e) above except upon execution of the above described
agreement of assumption and compliance with clauses (i), (ii), (iii), (iv)
and (v) above. When any Person acquires the properties and assets of the
Seller substantially as a whole and becomes the successor to the Seller 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, the Seller shall
automatically and without further notice be released from its obligations
hereunder.
SECTION 5.03 LIMITATION ON LIABILITY OF THE SELLER AND
OTHERS. The Seller and any director, officer, employee or agent of the
Seller 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 4.08, the
Seller shall not be under any obligation to appear in, prosecute or defend
any legal action that is not incidental 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. (a) This Agreement may be amended by
the Seller and the Issuer, with the consent of the Trustee and the
satisfaction of the Rating Agency Condition. Promptly after the execution
of any such amendment or consent, the Issuer shall furnish written
notification of the substance of such amendment or consent to each of the
Rating Agencies.
(b) Prior to the execution of any amendment to this
Agreement, the Issuer and the 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 Issuer and the Trustee may,
but shall not be obligated to, enter into any such amendment which affects
their own rights, duties or immunities under this Agreement or otherwise.
SECTION 6.02 NOTICES. Unless otherwise specifically provided
herein, all notices, directions, consents and waivers required under the
terms and provisions of this Agreement shall be in English and in writing,
and any such notice, direction, consent or waiver may be given by United
States first-class mail, reputable overnight courier service, facsimile
transmission or electronic mail (confirmed by telephone, United States
first-class mail or reputable overnight courier service in the case of
notice by facsimile transmission or electronic mail) or any other customary
means of communication, and any such notice, direction, consent or waiver
shall be effective when delivered or transmitted, or if mailed, five days
after deposit in the United States first-class mail with proper postage for
first-class mail prepaid:
(a) in the case of the Seller, at Public Service Electric and
Gas Company, 00 Xxxx Xxxxx, Xxxxxx, Xxx Xxxxxx 00000,
Attention: Treasurer,
(b) in the case of the Issuer, at PSE&G Transition Funding LLC,
00 Xxxx Xxxxx, X-0X, Xxxxxx, Xxx Xxxxxx 00000, Attention:
Managers,
(c) in the case of Moody's, at Xxxxx'x Investors Service, Inc.,
ABS Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000,
(d) in the case of Standard & Poor's, at Standard & Poor's
Ratings Group, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Asset Backed Surveillance Department, and
(e) in the case of Fitch, at Fitch, Inc., 0 Xxxxx Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: ABS Surveillance,
(f) in the case the Trustee, at the address provided for notices
or communications to the Trustee in the Indenture;
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 BY SELLER. Subject to Section 5.02,
this Agreement may not be assigned by the Seller.
SECTION 6.04 ASSIGNMENT TO TRUSTEE. The Seller hereby
acknowledges and consents to any pledge, assignment and grant of a security
interest by the Issuer to the Trustee pursuant to the Indenture for the
benefit of the Transition Bondholders of all right, title and interest of
the Issuer in, to and under the Transferred Bondable Transition Property
and the proceeds thereof and the assignment of any or all of the Issuer's
rights hereunder to the Trustee.
SECTION 6.05 LIMITATIONS ON RIGHTS OF OTHERS. The provisions
of this Agreement are solely for the benefit of the Seller, the Issuer and
the Trustee, on behalf of itself and the Transition Bondholders, 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 Collateral or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.
SECTION 6.06 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 6.07 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 6.08 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.
SECTION 6.09 GOVERNING LAW. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW JERSEY, 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 6.10 NONPETITION COVENANT. Notwithstanding any prior
termination of this Agreement or the Indenture, the Seller hereby covenants
and agrees that it shall not, prior to the date which is one year and one
day after the termination of the Indenture and the payment in full of the
Transition Bonds, any other amounts owed under the Indenture, including,
without limitation, any amounts owed to third-party credit enhancers, and
any amounts owed under the Hedge Agreement or the Interest Rate Swap
Agreement, acquiesce, petition or otherwise invoke or cause the Issuer to
invoke the process of any court or government authority for the purpose of
commencing or sustaining a case against the 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 the Issuer or any substantial part of the property of the
Issuer, or ordering the winding up or liquidation of the affairs of the
Issuer.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective duly
authorized officers as of the date and year first above written.
PSE&G TRANSITION FUNDING LLC,
as Issuer
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Manager
PUBLIC SERVICE ELECTRIC
AND GAS COMPANY,
as Seller
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Name: Xxxxx X. Xxxxx
Title: General Corporate Counsel
EXHIBIT A
XXXX OF SALE
For good and valuable consideration the receipt of which is
hereby acknowledged, PUBLIC SERVICE ELECTRIC AND GAS COMPANY, a New Jersey
corporation (the "Seller"), does hereby sell, assign, transfer and convey
to PSE&G TRANSITION FUNDING LLC, a Delaware limited liability company (the
"Issuer"), without recourse except as provided in the Sale Agreement
referred to below, all of the Seller's right, title and interest in, to and
under all of its Bondable Transition Property, which sale, assignment,
transfer and conveyance of such Bondable Transition Property shall include,
as provided in the Competition Act, the sale, assignment, transfer and
conveyance of all of the Seller's right, title and interest in, to and
under all revenues, collections, payments, money or proceeds arising under
or with respect to the Transition Bond Charge related to such Bondable
Transition Property, as the same may be adjusted from time to time in
accordance with the Competition Act and the Financing Order, to have and to
hold the same unto the Issuer and to the successors and assigns of the
Issuer, forever.
Capitalized terms used herein and not defined shall have the
meanings set forth in the Bondable Transition Property Sale Agreement dated
as of January 31, 2001 (the "Sale Agreement") between the Issuer and the
Seller.
This Xxxx of Sale is governed by the laws of the State of
New Jersey.
IN WITNESS WHEREOF, the Seller has duly executed and
delivered this Xxxx of Sale this 31st day of January, 2001.
PUBLIC SERVICE ELECTRIC
AND GAS COMPANY, as Seller
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Accepted this 31st day of January, 2001.
PSE&G TRANSITION FUNDING LLC
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
EXHIBIT B
OPINION OF COUNSEL
EXHIBIT C
OPINION OF COUNSEL
APPENDIX A
MASTER DEFINITIONS
The definitions contained in this Appendix A are applicable to the singular
as well as the plural forms of such terms.
Act has the meaning specified in Section 11.03 of the Indenture.
Adjustment Date means (a) January 1 of each year through January 1,
2015, (b) as long as the Transition Bonds are outstanding, October
1, January 1, April 1 and July 1 of each year, beginning April 1,
2015, and (c) any other date which is thirty days after a
Calculation Date.
Adjustment Request means an application filed by the Servicer with
the BPU for a Transition Bond Charge Adjustment pursuant to Section
4(b) of the Issuer Annex.
Administration Agreement means the Administration Agreement dated
as of January 31, 2001, between PSE&G, as administrator, and the
Issuer, as the same may be amended or supplemented from time to
time.
Administrator means PSE&G, as administrator under the
Administration Agreement, and each successor to PSE&G, in the same
capacity, pursuant to Section 14 of the Administration Agreement.
Advice Letter means, with respect to any Series of Transition
Bonds, the Issuance Advice Letter, in the form attached as Appendix
B to the Financing Order, filed with the BPU at the time of the
issuance of such Series.
Affiliate means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with
such specified Person. For the purposes of this definition, control
when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms controlling and controlled
have meanings correlative to the foregoing.
Annual Accountant's Report has the meaning assigned to that term in
Section 3.07 of the Servicing Agreement.
Annual Reconciliation Date means the last Business Day of October
of each year, commencing with October 2001 and continuing through
October 2014 (or such earlier month as the Servicer shall have
specified to the Issuer and the Trustee by not less than 30 days
prior written notice).
Authorized Denominations means, with respect to any Series or Class
of Transition Bonds, $1,000 and integral multiples of $1.00 above
that amount, provided, however, that one bond of each Class may
have denomination of less than $1,000, or such other denominations
as may be specified in the Series Supplement therefor.
Authorized Newspaper means the Luxemburger Wort or any other
newspaper published in Luxembourg on a daily basis.
Authorized Officer means, with respect to the Issuer, (a) any
Manager and, (b) any person designated as an "Officer" under the
Issuer LLC Agreement and authorized thereby to act on behalf of the
Issuer.
Basic Documents means the Formation Documents, the Sale Agreement,
any Bills of Sale, the Servicing Agreement, the Administration
Agreement, the Indenture, the Underwriting Agreement, the Hedge
Agreement, the Interest Rate Swap Agreement and the Securities
Account Control Agreement, as each may be amended or supplemented
from time to time.
Billing Month means a calendar month during which the Transition
Bond Charge is billed to Customers.
Xxxx of Sale means any xxxx of sale issued by the Seller to the
Issuer pursuant to the Sale Agreement evidencing the sale of
Bondable Transition Property by the Seller to the Issuer.
Bondable Stranded Costs means those bondable stranded costs, within
the meaning specified in the Competition Act, approved for recovery
in the Financing Order.
Bondable Transition Property has the meaning assigned to that term
in the Competition Act and the Financing Order.
Bondable Transition Property Documentation means all documents
relating to the Transferred Bondable Transition Property, including
copies of the Petition and the Financing Order and all documents
filed with the BPU in connection with any Transition Bond Charge
Adjustment.
Book-Entry Transition Bonds means beneficial interests in the
Transition Bonds, ownership and transfers of which shall be made
through book entries by a Clearing Agency as described in Section
2.11 of the Indenture.
BPU means the State of New Jersey Board of Public Utilities or its
successor.
BPU Regulations means any regulations, orders, guidelines or
directives promulgated, issued or adopted by the BPU.
Business Day means any day other than a Saturday or Sunday or a day
on which banking institutions in the City of Newark, New Jersey, or
in the City of New York, New York or, with respect to any
Transition Bonds listed on the Luxembourg Stock Exchange, in
Luxembourg, are required or authorized by law or executive order to
remain closed.
Calculation Date means (a) December 1 of each year until December
1, 2014, (b) September 1, December 1, March 1 and June 1 of each
year beginning March 1, 2015 and for so long as the Transition
Bonds are outstanding, and (c) any other day on which the Servicer
files an Adjustment Request.
Capital Reserve Subaccount has the meaning specified in Section
8.02(a) of the Indenture.
Capital Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Class means, with respect to any Series, any one of the classes of
Transition Bonds of that Series, as specified in the Series
Supplement for that Series.
Class Final Maturity Date means the Final Maturity Date of a Class,
as specified in the Series Supplement for the related Series.
Class Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Clearing Agency means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
Clearing Agency Participant means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of
securities deposited with the Clearing Agency.
Code means the Internal Revenue Code of 1986, as amended from time
to time, and Treasury Regulations promulgated thereunder.
Collateral has the meaning specified in the Granting Clause of the
Indenture.
Collection Account has the meaning specified in Section 8.02(a) of
the Indenture.
Collection Period means the period from and including the first day
of a calendar month to but excluding the first day of the next
calendar month.
Collections Curve means a forecast prepared by the Servicer of the
percentages of amounts billed in a Billing Month that are expected
to be received during each of the following seven months.
Collections Curve Payment means, with respect to a Billing Month,
the sum of the amounts paid to the Trustee over a seven-month
period following that Billing Month based on the Collections Curve
for that Billing Month.
Commission means the U.S. Securities and Exchange Commission, and
any successor thereof.
Competition Act means the Electric Discount and Energy Competition
Act, New Jersey Statutes Annotated, title 48, chapter 3, article 7.
Corporate Trust Office means the principal office of the Trustee at
which at any particular time its corporate trust business shall be
administered, which office at date of the execution of this
Indenture is located at 000 Xxxxxxx Xxxxxx, Xxxxx 12 East, New
York, New York 10286, Attention: CDO Unit, or at such other address
as the Trustee may designate from time to time by notice to the
Transition Bondholders and the Issuer, or the principal corporate
trust office of any successor Trustee (the address of which the
successor Trustee will notify the Transition Bondholders and the
Issuer in writing).
Covenant Defeasance Option has the meaning specified in Section
4.01(b) of the Indenture.
Curve Payment Shortfall means: (a) with respect to each Annual
Reconciliation Date, the excess of actual TBC Collections in
respect of each of the 12 Billing Months beginning 19 Billing
Months (or from the first Series Issuance Date, if less than 19
months have elapsed) before the Billing Month in which such
Reconcilation Date occurs, over the actual Collection Curve
Payments made to the Trustee in respect of those Billing Months;
and (b) with respect to each Monthly Reconciliation Date, the
excess of actual TBC Collections in respect of the Billing Month
that is 8 months prior to the Billing Month in which such
Reconciliation Date occurs, over the actual Collection Curve
Payments made to the Trustee in respect of that prior Billing
Month.
Customer means each person who is a retail consumer of electricity
and who accesses PSE&G's transmission and distribution system,
regardless of whether such consumer elects to purchase electricity
from a Third Party.
Daily Remittance Date means, if the Servicer has not satisfied the
conditions of Section 5.11(b) of the Servicing Agreement, each
Business Day commencing on the second Business Day following the
date on which the Servicer begins remittance procedures under
Section 3.03(a)(ii)(y) of the Servicing Agreement.
Default means any occurrence that is, or with notice or the lapse
of time or both would become, an Event of Default.
Defeasance Subaccount has the meaning specified in Section 8.02(a)
of the Indenture.
Definitive Transition Bonds has the meaning specified in Section
2.11 of the Indenture.
DTC Agreement means the agreement between the Issuer, the Trustee
and The Depository Trust Company, as the initial Clearing Agency,
dated on or about January 31, 2001, relating to the Transition
Bonds, as the same may be amended or supplemented from time to
time.
Eligible Guarantor Institution means a firm or other entity
identified in Rule 17Ad-15 under the Exchange Act as "an eligible
guarantor institution," including (as such terms are defined
therein):
(a) a bank;
(b) a broker, dealer, municipal securities broker or
dealer or government securities broker or dealer;
(c) a credit union;
(d) a national securities exchange, registered securities
association or clearing agency; or
(e) a savings association that is a participant in a
securities transfer association.
Eligible Institution means:
(a) the corporate trust department of the Trustee, so
long as any of the securities of the Trustee have a
credit rating from each Rating Agency in one of its
generic rating categories which signifies investment
grade, or
(b) a depositary institution organized under the laws of
the United States of America or any State (or any
domestic branch of a foreign bank), which
(i) has either
(A) with respect to any Eligible Investment
having a maturity of greater than one
month, a long-term unsecured debt
rating of "AAA" by Standard & Poor's
and Fitch and "Aaa" by Moody's, or
(B) with respect to any Eligible Investment
having a maturity one month or less, a
certificate of deposit rating of "A-1+"
by Standard & Poor's and "P-1" by
Moody's, or any other long-term,
short-term or certificate of deposit
rating acceptable to the Rating
Agencies, and
(ii) whose deposits are insured by the FDIC.
Eligible Investments mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or
registered form which evidence:
(a) direct obligations of, and obligations fully and
unconditionally guaranteed as to timely payment by,
the United States of America;
(b) demand deposits, time deposits or certificates of
deposit of any depository institution or trust
company (any depositary institution or trust company
being referred to in this definition as a "financial
institution") incorporated under the laws of the
United States of America or any State thereof (or any
domestic branch of a foreign bank) and subject to
supervision and examination by Federal or State
banking or depositary institution authorities;
provided, however, that at the time of the investment
or contractual commitment to invest therein, the
commercial paper or other short-term unsecured debt
obligations (other than such obligations the rating
of which is based on the credit of a Person other
than such depositary institution or trust company)
thereof shall have a credit rating from each of the
Rating Agencies in the highest investment category
granted thereby;
(c) commercial paper or other short term obligations of
any corporation organized under the laws of the
United States of America (other than PSE&G) whose
ratings, at the time of the investment or contractual
commitment to invest therein, from each of the Rating
Agencies are in the highest investment category
granted thereby;
(d) demand deposits, time deposits and certificates of
deposit which are fully insured by the Federal
Deposit Insurance Corporation;
(e) investments in money market funds having a rating
from each of the Rating Agencies in the highest
investment category granted thereby (including funds
for which the Trustee or any of its Affiliates act as
investment manager or advisor);
(f) bankers' acceptances issued by any depositary
institution or trust company referred to in clause
(b) above;
(g) repurchase obligations with respect to any security
that is a direct obligation of, or fully guaranteed
by, the United States of America or any agency or
instrumentality thereof the obligations of which are
backed by the full faith and credit of the United
States of America, in either case entered into with a
depositary institution or trust company (acting as
principal) described in clause (b) above;
(h) repurchase obligations with respect to any security
or whole loan entered into with
(i) a financial institution (acting as principal)
described in clause (b) above,
(ii) a broker/dealer (acting as principal)
registered as a broker or dealer under Section
15 of the Exchange Act (any broker/dealer
being referred to in this definition as a
"broker/dealer"), the unsecured short-term
debt obligations of which are rated P-1 by
Moody's and A-1+ by Standard & Poor's at the
time of entering into this repurchase
obligation, or
(iii) an unrated broker/dealer, acting as principal,
that is a wholly-owned subsidiary of a
non-bank or bank holding company the unsecured
short-term debt obligations of which are rated
P-1 by Moody's and A-1+ by Standard & Poor's
at the time of purchase; or
(i) any other investment permitted by each Rating Agency;
provided, however, that, with respect to Moody's only, the obligor
related to clauses (b), (c), (d), (f), (g) and (h) above must have
both a long term rating of at least A1 and a short term rating of
at least P1, and provided further, that, unless otherwise permitted
by each Rating Agency, upon the failure of any Eligible Institution
to maintain any applicable rating set forth in this definition or
the definition of Eligible Institution, the related investments at
such institution shall be reinvested in Eligible Investments at a
successor Eligible Institution within 10 days, and provided,
further, that, any Eligible Investment must not:
(a) be sold, liquidated or otherwise disposed of at a
loss, prior to the maturity thereof, or
(b) mature later than (i) the date on which the proceeds
of such Eligible Investment will be required to be on
deposit in the Collection Account in order for the
Trustee to make all required and scheduled payments
and deposits into Subaccounts under the Indenture, if
such Eligible Investment is held by an Affiliate of
the Trustee, or (ii) the Business Day prior to the
date on which the proceeds of such Eligible
Investment will be required to be on deposit in the
Collection Account in order for the Trustee to make
all required and scheduled payments and deposits into
Subaccounts under the Indenture, if such Eligible
Investment is not held by an Affiliate of the
Trustee.
Eligible Securities Account means either:
(a) a segregated trust account with an Eligible
Institution or
(b) a segregated trust account with the corporate trust
department of a depositary institution organized
under the laws of the United States of America or any
State (or any domestic branch of a foreign bank),
having corporate trust powers and acting as trustee
for funds deposited in such account, so long as any
of the securities of such depositary institution
shall have a credit rating from each Rating Agency in
one of its generic rating categories which signifies
investment grade.
Event of Default has the meaning specified in Section 5.01 of the
Indenture.
Excess Curve Payment means, (a) with respect to each Annual
Reconciliation Date, the excess of the Collections Curve Payments
made to the Trustee in respect of each of the 12 Billing Months
beginning 19 Billing Months (or from the first Series Issuance
Date, if less than 19 months have elapsed) before the Billing Month
in which the Reconciliation Date occurs, over the actual TBC
Collections in respect of those Billing Months; and (b) with
respect to each Monthly Reconciliation Date, the excess of the
Collections Curve Payments made to the Trustee in respect of the
Billing Month that is 8 months prior to the Billing Month in which
such Reconciliation Date occurs, over the actual TBC Collections in
respect of that prior Billing Month.
Exchange Act means the Securities Exchange Act of 1934, as amended.
Executive Officer means, with respect to any corporation, the chief
executive officer, chief operating officer, chief financial
officer, chief information officer, president, executive vice
president, any vice president, the secretary or the treasurer of
such corporation; and with respect to any limited liability
company, any manager thereof.
Expected Amortization Schedule means, with respect to each Series
or, if applicable, each Class of Transition Bonds, the expected
amortization schedule for principal thereof, as specified in the
Series Supplement therefor.
Expected Final Payment Date means, with respect to each Series or,
if applicable, each Class of Transition Bonds, the Payment Date
related to the date when all interest and principal is scheduled to
be paid with respect to that Series or Class in accordance with the
Expected Amortization Schedule, as specified in the Series
Supplement therefor.
FDIC means the Federal Deposit Insurance Corporation or its
successor.
Final Maturity Date means, for each Series or, if applicable, each
Class of Transition Bonds, the Payment Date related to the date by
which all principal of and interest on such Series or Class of
Transition Bonds is required to be paid, as specified in the Series
Supplement therefor.
Financing Issuance means an issuance of a new Series of Transition
Bonds under the Indenture to provide funds to finance the purchase
by the Issuer of Bondable Transition Property.
Financing Order means the bondable stranded cost rate order issued
by the BPU on September 17, 1999 pursuant to the Competition Act.
Fitch means Fitch, Inc., or its successor.
Formation Documents means, collectively, the Issuer LLC Agreement,
the Issuer Certificate of Formation and any other document pursuant
to which the Issuer is formed or governed, as each may be amended
or supplemented from time to time.
General Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Grant means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, and xxxxx x xxxx
upon and a security interest in and right of set-off against,
deposit, set over and confirm. A Grant of the Collateral or of any
other agreement or instrument shall include all rights, powers and
options (but none of the obligations) of the Granting party
thereunder, including the immediate and continuing right to claim
for, collect, receive and give receipt for principal, interest and
other payments in respect of the Collateral and all other moneys
payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise
all rights and options, to bring Proceedings in the name of the
Granting party or otherwise and generally to do and receive
anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
Hedge Counterparty means PSE&G as hedge counterparty under the
Hedge Agreement.
Hedge Agreement means the ISDA Master Agreement and the related
Schedule and Confirmations, each dated January 5, 2001 between
PSE&G and the Issuer, as same may be amended or supplemented from
time to time.
Holder or Transition Bondholder means the Person in whose name a
Transition Bond of any Series or Class is registered in the
Transition Bond Register.
Indemnification Event means an event which triggers PSE&G's
obligation to indemnify the Issuer and the Trustee, for itself and
on behalf of the Transition Bondholders, and each of their
respective managers, officers, directors and agents, pursuant to
Section 5.01 of the Sale Agreement.
Indemnity Amount means the amount of any indemnification obligation
payable under the Basic Documents.
Indenture means the Indenture dated as of January 31, 2001, between
the Issuer and the Trustee, as the same may be amended and
supplemented from time to time by one or more Supplemental
Indentures, and shall include each Series Supplement and the forms
and terms of the Transition Bonds established thereunder.
Independent means, when used with respect to any specified Person,
that the Person
(a) is in fact independent of the Issuer, any other
obligor upon the Transition Bonds, PSE&G and any
Affiliate of any of the foregoing Persons,
(b) does not have any direct financial interest or any
material indirect financial interest in the Issuer,
any such other obligor, PSE&G or any Affiliate of any
of the foregoing Persons, and
(c) is not connected with the Issuer, any such other
obligor, PSE&G or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter,
underwriter, trustee, partner, director or person
performing similar functions.
Independent Certificate means a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section
11.01 of the Indenture, made by an Independent appraiser or other
expert appointed by an Issuer Order and approved by the Trustee in
the exercise of reasonable care, and such opinion or certificate
shall state that the signer has read the definition of
"Independent" in this Appendix A and that the signer is Independent
within the meaning thereof.
Independent Manager has the meaning set forth in the Issuer LLC
Agreement.
Initial Purchase Price has the meaning set forth in Section 2.01 of
the Sale Agreement.
Initial Transfer Date means the Series Issuance Date for the first
Series of Transition Bonds.
Initial Transferred Bondable Transition Property means the Bondable
Transition Property sold by the Seller to the Issuer as of the
Initial Transfer Date pursuant to the Sale Agreement and the Xxxx
of Sale delivered on or prior to the Initial Transfer Date as
identified in such Xxxx of Sale.
Insolvency Event means, with respect to a specified Person,
(a) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of
such Person or any substantial part of its property
in an involuntary case under any applicable Federal
or State bankruptcy, insolvency or other similar law
now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or
for any substantial part of its property, or ordering
the winding-up or liquidation of such Person's
affairs, and such decree or order shall remain
unstayed and in effect for a period of 90 consecutive
days or
(b) the commencement by such Person of a voluntary case
under any applicable Federal or State bankruptcy,
insolvency or other similar law now or hereafter in
effect, or the consent by such Person to the entry of
an order for relief in an involuntary case under any
such law, or the consent by such Person to the
appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or
for any substantial part of its property, or the
making by such Person of any general assignment for
the benefit of creditors, or the failure by such
Person generally to pay its debts as such debts
become due, or the taking of action by such Person in
furtherance of any of the foregoing.
Interest means, for any Payment Date for any Series or Class of
Transition Bonds, the sum, without duplication, of:
(a) an amount equal to the amount of interest accrued at
the applicable Interest Rate from the prior Payment
Date with respect to that Series or Class;
(b) any unpaid interest, to the extent permitted by law,
plus any interest accrued on this unpaid interest at
the applicable Interest Rate, to the extent permitted
by applicable law;
(c) if the Transition Bonds have been declared due and
payable, all accrued and unpaid interest thereon; and
(d) with respect to a Series or Class to be redeemed
prior to the next Payment Date, the amount of
interest that will be payable as interest on such
Series or Class upon such redemption.
Interest Rate means, with respect to each Series or Class of
Transition Bonds, the rate at which interest accrues on the
principal balance of Transition Bonds of such Series or Class, as
specified in the Series Supplement therefor.
Interest Rate Swap Agreement means any ISDA Master Agreement,
together with the related Schedule and Confirmation, between the
Issuer and a Swap Counterparty, as same may be amended or
supplemented from time to time, with respect to any Series or Class
of Transition Bonds.
Issuer means PSE&G Transition Funding LLC, a Delaware limited
liability company, or its successor under the Indenture or the
party named as such in the Indenture until a successor replaces it
and, thereafter, means the successor.
Issuer Annex means Annex 1 of the Servicing Agreement.
Issuer Certificate of Formation means the Amended and Restated
Certificate of Formation of the Issuer, dated January 25, 2001,
which was filed with the Delaware Secretary of State's Office on
January 26, 2001, as the same may be amended or supplemented from
time to time.
Issuer LLC Agreement means the Amended and Restated Limited
Liability Company Agreement between the Issuer and PSE&G, as sole
Member, dated as of January 31, 2001, as the same may be amended or
supplemented from time to time.
Issuer Officer's Certificate means a certificate signed by any
Authorized Officer of the Issuer, under the circumstances described
in, and otherwise complying with, the applicable requirements of
Section 11.01 of the Indenture, and delivered to the Trustee.
Unless otherwise specified, any reference in the Indenture to an
Officer's Certificate shall be to an Officer's Certificate of any
Authorized Officer of the Issuer.
Issuer Opinion of Counsel means one or more written opinions of
counsel who may, except as otherwise expressly provided in the
Indenture, be employees of or counsel to the Issuer or the Seller
and who shall be reasonably satisfactory to the Trustee, and which
opinion or opinions shall be addressed to the Trustee, and shall be
in a form reasonably satisfactory to the Trustee.
Issuer Order or Issuer Request means a written order or request,
respectively, signed in the name of the Issuer by any one of its
Authorized Officers and delivered to the Trustee.
Legal Defeasance Option has the meaning specified in Section
4.01(b) of the Indenture.
Lien means a security interest, lien, charge, pledge, equity or
encumbrance of any kind.
Losses means collectively, any and all liabilities, obligations,
losses, damages, payments, costs or expenses of any kind
whatsoever.
Manager has the meaning set forth in the Issuer LLC Agreement.
Market Transition Charge means the market transition charge that
PSE&G may impose on Customers pursuant to the Competition Act and
the Restructuring Order.
Member means PSE&G, as the sole member of the Issuer, in its
capacity as such member under the Issuer LLC Agreement.
Monthly Reconciliation Date means the last Business Day of each
month commencing with November 2014 (or such earlier month as the
Servicer shall have specified to the Issuer and the Trustee by not
less than 30 days prior written notice).
Monthly Remittance Date means the 13th day of each calendar month
(or if such day is not a Business Day, the preceding Business Day)
beginning in March 2001.
Monthly Servicing Fee means the fee payable to the Servicer on a
monthly basis for services rendered, in accordance with Section
5.07 of the Servicing Agreement.
Moody's means Xxxxx'x Investors Service, Inc., or its successor.
MTC-Tax means the tax which PSE&G is entitled to impose under the
Restructuring Order.
New Jersey UCC means the Uniform Commercial Code, as in effect in
the State of New Jersey, as amended from time to time.
Officers' Certificate means a certificate signed by
(a) the chairman of the board, the president, the vice
chairman of the board, any executive vice president
or any vice president; and
(b) the treasurer, any assistant treasurer, the secretary
or any assistant secretary of PSE&G.
Operating Expenses means, with respect to the Issuer, all fees,
costs, expenses and indemnity payments owed by the Issuer,
including, without limitation, all amounts owed by the Issuer to
the Trustee, the Monthly Servicing Fee, the fees and expenses
payable by the Issuer to the Administrator under the Administration
Agreement, the fees and expenses payable by the Issuer to the
Independent Managers and Special Members of the Issuer, fees of the
Rating Agencies, legal fees and expenses of the Servicer pursuant
to Section 3.10 of the Servicing Agreement, legal and accounting
fees, costs and expenses of the Issuer, and legal, accounting or
other fees, costs and expenses of the Seller (including, without
limitation, any costs and expenses incurred by the Seller pursuant
to Section 4.08 of the Sale Agreement) under or in connection with
the Basic Documents or the Financing Order.
Opinion of Counsel means one or more written opinions of counsel
who may be an employee of or counsel to PSE&G, the Issuer or any
other Person (as the context may require), which counsel shall be
reasonably acceptable to the Trustee, the Issuer or the Rating
Agencies, as applicable, and which shall be in form reasonably
satisfactory to the Trustee, if applicable.
Outstanding with respect to Transition Bonds means, as of the date
of determination, all Transition Bonds theretofore authenticated
and delivered under the Indenture except:
(a) Transition Bonds theretofore canceled by the
Transition Bond Registrar or delivered to the
Transition Bond Registrar for cancellation;
(b) Transition Bonds or portions thereof the payment for
which money in the necessary amount has been
theretofore deposited with the Trustee or any Paying
Agent in trust for the Holders of such Transition
Bonds; provided, however, that if such Transition
Bonds are to be redeemed, notice of such redemption
has been duly given pursuant to the Indenture or
provision therefor, satisfactory to the Trustee,
made; and
(c) Transition Bonds in exchange for or in lieu of other
Transition Bonds which have been authenticated and
delivered pursuant to the Indenture unless proof
satisfactory to the Trustee is presented that any
such Transition Bonds are held by a protected
purchaser;
provided that in determining whether the Holders of the requisite
Outstanding Amount of the Transition Bonds or any Series or Class
thereof have given any request, demand, authorization, direction,
notice, consent or waiver hereunder or under any Basic Document,
Transition Bonds owned by the Issuer, any other obligor upon the
Transition Bonds, PSE&G or any Affiliate of any of the foregoing
Persons shall be disregarded and deemed not to be Outstanding,
except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Transition Bonds that the Trustee
knows to be so owned shall be so disregarded. Transition Bonds so
owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such
Transition Bonds and that the pledgee is not the Issuer, any other
obligor upon the Transition Bonds, PSE&G or any Affiliate of any of
the foregoing Persons.
Outstanding Amount means the aggregate principal amount of all
Outstanding Transition Bonds or, if the context requires, all
Outstanding Transition Bonds of a Series or Class Outstanding at
the date of determination.
Overcollateralization means, with respect to any Payment Date, an
amount that, if deposited to the Overcollateralization Subaccount,
would cause the balance in such subaccount to equal the Scheduled
Overcollateralization Level for such Payment Date.
Overcollateralization Amount means, with respect to any Series of
Transition Bonds, the amount specified as such in the Series
Supplement therefor.
Overcollateralization Subaccount has the meaning specified in
Section 8.02(a) of the Indenture.
Paying Agent means the Trustee or any other Person, including any
Person appointed pursuant to Section 3.02(b) of the Indenture, that
meets the eligibility standards for the Trustee specified in
Section 6.11 of the Indenture and is authorized by the Issuer to
make the payments of principal of or premium, if any, or interest
on the Transition Bonds on behalf of the Issuer.
Payment Date means, with respect to each Series or Class of
Transition Bonds, each date or dates respectively specified as
Payment Dates for such Series or Class in the Series Supplement
therefor.
Person means any individual, corporation, estate, partnership,
joint venture, association, joint stock company, trust (including
any beneficiary thereof), business trust, limited liability
company, unincorporated organization or government or any agency or
political subdivision thereof.
Petition means the petition filed by PSE&G with the BPU, dated June
8, 1999.
Predecessor Transition Bond means, with respect to any particular
Transition Bond, every previous Transition Bond evidencing all or a
portion of the same debt as that evidenced by such particular
Transition Bond; and, for the purpose of this definition, any
Transition Bond authenticated and delivered under Section 2.06 of
the Indenture in lieu of a mutilated, lost, destroyed or stolen
Transition Bond shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Transition Bond.
Principal means, with respect to any Payment Date and each Series
or Class of Transition Bonds:
(a) the amount of principal scheduled to be paid on such
Payment Date in accordance with the Expected
Amortization Schedule;
(b) the amount of principal due on the Final Maturity
Date of any Series or Class on such Payment Date;
(c) the amount of principal due as a result of the
occurrence and continuance of an Event of Default and
acceleration of the Transition Bonds;
(d) the amount of principal and premium, if any, due as a
result of a redemption of Transition Bonds on such
Payment Date; and
(e) any overdue payments of principal.
Proceeding means any suit in equity, action at law or other
judicial or administrative proceeding.
Projected Transition Bond Balance means, as of any date, the sum of
the amounts provided for in the Expected Amortization Schedules for
each outstanding Series of Transition Bonds as of such date.
PSE&G means Public Service Electric and Gas Company, a New Jersey
corporation, or its successor.
Rating Agency means, as of any date, any rating agency rating the
Transition Bonds of any Class or Series at the time of issuance
thereof at the request of the Issuer. If no such organization or
successor is any longer in existence, "Rating Agency" shall be a
nationally recognized statistical rating organization or other
comparable Person designated by the Issuer, notice of which
designation shall be given to the Trustee, the Member and the
Servicer.
Rating Agency Condition means, with respect to any action, the
notification by the Trustee to each Rating Agency of such action
and the notification from each of Fitch and S&P to the Trustee and
the Issuer that such action will not result in a reduction or
withdrawal of the then current rating by such Rating Agency of any
Outstanding Series or Class of Transition Bonds.
Reconciliation Date means an Annual Reconciliation Date or a
Monthly Reconciliation Date, as appropriate.
Record Date has the meaning set forth in each Supplemental
Indenture.
Redemption Date means, with respect to each Series or Class of
Transition Bonds, the date for the redemption of the Transition
Bonds of such Series or Class pursuant to Sections 10.01 or 10.02
of the Indenture or the Series Supplement for such Series or Class,
which in each case shall be a Payment Date.
Redemption Price has the meaning set forth in Section 10.01 of the
Indenture.
Refunding Issuance means an issuance of a new Series of Transition
Bonds under the Indenture to pay the cost of refunding, through
redemption or payment on the Expected Final Payment Date for a
Series or Class of Transition Bonds, all or part of the Transition
Bonds of such Series or Class to the extent permitted by the terms
thereof.
Registered Holder means, as of any date, the Person in whose name a
Transition Bond is registered in the Transition Bond Register on
such date.
Released Parties has the meaning specified in Section 5.02(f) of
the Servicing Agreement.
Remittance Date means a Daily Remittance Date or a Monthly
Remittance Date, as applicable.
Required Capital Amount means with respect to any Series, the
amount required to be deposited in the Capital Subaccount on the
Series Issuance Date of such Series, as specified in the related
Series Supplement.
Reserve Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Responsible Officer means, with respect to the Trustee, any officer
within the Corporate Trust Office of the Trustee, including any
vice president, assistant vice president, secretary, assistant
secretary, or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.
Restructuring Order means the order of the BPU issued on August 24,
1999 pursuant to Section 13 of the Competition Act.
Retiring Trustee means a Trustee that resigns or vacates the office
of Trustee for any reason.
Sale Agreement means the Bondable Transition Property Sale
Agreement dated January 31, 2001 between the Seller and the Issuer,
as the same may be amended or supplemented from time to time.
Scheduled Overcollateralization Level means, with respect to each
Series and any Payment Date, the amount with respect to such Series
set forth as such in Schedule 1 of the Indenture, as such Schedule
has been adjusted in accordance with Section 3.19 of the Indenture
to reflect redemptions or defeasances of Transition Bonds and
issuances of additional Series of Transition Bonds.
Securities Account Control Agreement means the securities account
control agreement by and between PSE&G Transition Funding LLC, as
debtor, the Trustee as the Secured Party and The Bank of New York,
in its capacity as securities intermediary thereunder.
Seller means PSE&G, in its capacity as seller of the Bondable
Transition Property to the Issuer pursuant to the Sale Agreement.
Series means any series of Transition Bonds issued by the Issuer
and authenticated by the Trustee pursuant to the Indenture, as
specified in the Series Supplement therefor.
Series Capital Subaccount has the meaning specified in Section
8.02(a) of the Indenture.
Series Final Maturity Date means the Final Maturity Date for a Series.
Series Issuance Date means, with respect to any Series, the date on
which the Transition Bonds of such Series are to be originally
issued in accordance with Section 2.10 of the Indenture and the
Series Supplement for such Series.
Series Overcollateralization Subaccount has the meaning specified
in Section 8.02(a) of the Indenture.
Series Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Series Supplement means an indenture supplemental to the Indenture
that authorizes a particular Series of Transition Bonds, as the
same may be amended or supplemented from time to time.
Servicer means PSE&G, as the servicer of the Bondable Transition
Property, and each successor to PSE&G (in the same capacity)
pursuant to Section 5.03 or 6.04 of the Servicing Agreement.
Servicer Default means an event specified in Section 6.01 of the
Servicing Agreement.
Servicing Agreement means the Servicing Agreement dated as of
January 31, 2001, between the Issuer and the Servicer, as the same
may be amended and supplemented from time to time.
Special Member has the meaning set forth in the Issuer LLC
Agreement.
Standard & Poor's, or S&P, means Standard & Poor's Ratings Group, a
division of The XxXxxx-Xxxx Companies, or its successor.
State means any one of the 50 states of the United States of
America or the District of Columbia.
Subaccount means any of the subaccounts of the Collection Account
specified in Section 8.02 of the Indenture.
Subsequent Sale means the sale of additional Bondable Transition
Property by the Seller to the Issuer after the Initial Transfer
Date, subject to the satisfaction of the conditions specified in
the Sale Agreement and the Indenture.
Subsequent Transfer Date means the date that a sale of Subsequent
Transferred Bondable Transition Property will be effective, as
specified in a written notice provided by the Seller to the Issuer
pursuant to the Sale Agreement.
Subsequent Transferred Bondable Transition Property means Bondable
Transition Property sold by the Seller to the Issuer as of a
Subsequent Transfer Date pursuant to the Sale Agreement and the
Xxxx of Sale delivered on or prior to the Subsequent Transfer Date
as identified in such Xxxx of Sale.
Successor Servicer means a successor Servicer appointed by the
Trustee pursuant to Section 6.04 of the Servicing Agreement which
succeeds to all the rights and duties of the Servicer under the
Servicing Agreement.
Supplemental Indenture means a supplemental indenture entered into
by the Issuer and the Trustee pursuant to Article IX of the
Indenture.
Swap Counterparty means, with respect to any Interest Rate Swap
Agreement, the swap counterparty under that Interest Rate Swap
Agreement.
TBC Collections means amounts received by the Servicer in respect
of the Transition Bond Charge.
Termination Notice has the meaning specified in Section 6.01 of the
Servicing Agreement.
Third Party means any third party, including any electric
generation supplier, providing billing or metering services,
licensed by the BPU pursuant to relevant provisions of the
Competition Act, the BPU Regulations and the Financing Order.
Transfer Date means the Initial Transfer Date or any Subsequent
Transfer Date, as applicable.
Transferred Bondable Transition Property means Bondable Transition
Property which has been sold, assigned and transferred to the
Issuer pursuant to the Sale Agreement.
Transition Bond means any of the transition bonds (as defined in
the Competition Act) issued by the Issuer pursuant to the
Indenture.
Transition Bond Balance means, as of any date, the aggregate
Outstanding Amount of all Series of Transition Bonds on such date.
Transition Bond Charge means the Transition Bond Charge authorized
by the BPU to be imposed on all Customers by PSE&G or its successor
to recover Bondable Stranded Costs pursuant to the Competition Act
and the Financing Order.
Transition Bond Charge Adjustment means each adjustment to the
Transition Bond Charge related to the Transferred Bondable
Transition Property made in accordance with Section 4.01 of the
Servicing Agreement and the Issuer Annex.
Transition Bond Charge Adjustment Process means the process by
which the Transition Bond Charge is adjusted pursuant to the
Servicing Agreement, the Competition Act, the Petition and the
Financing Order.
Transition Bond Owner means, with respect to a Book-Entry
Transition Bond, the Person who is the beneficial owner of such
Book-Entry Transition Bond, as reflected on the books of the
Clearing Agency, or on the books of a Person maintaining an account
with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
Transition Bond Register has the meaning specified in Section
2.05(a) of the Indenture.
Transition Bond Registrar has the meaning specified in Section
2.05(a) of the Indenture.
Trust Indenture Act or TIA means the Trust Indenture Act of 1939,
as in force on the date hereof, unless otherwise specifically
provided.
Trustee means The Bank of New York, a New York banking corporation,
or its successor, as trustee under the Indenture and in the
capacity specified in the first paragraph of the Indenture, or any
successor Trustee under the Indenture.
Underwriting Agreement means the Underwriting Agreement dated as of
January 25, 2001, among the Seller, the Issuer and Xxxxxx Brothers,
Inc., on behalf of itself and as the representative of the several
underwriters named therein.
U.S. Government Obligations means direct obligations (or
certificates representing an ownership interest in such
obligations) of the United States of America (including any agency
or instrumentality thereof) for the payment of which the full faith
and credit of the United States of America is pledged and which are
not callable at the issuer's option.
