Indemnities of Servicer; Release of Claims. The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement. The Servicer shall indemnify the Issuer, the Indenture Trustee (for itself and for the benefit of the Holders), and the Independent Managers and each of their respective trustees, officers, directors, employees and agents (each, an "Indemnified Person") for, and defend and hold harmless each such Person from and against, any and all Losses imposed on, incurred by or asserted against any such Person as a result of (i) the Servicer's willful misconduct, bad faith or negligence in the performance of its duties or observance of its covenants under this Agreement or its reckless disregard of its obligations and duties under this Agreement, (ii) the Servicer's breach of any of its representations and warranties contained in this Agreement, (iii) any litigation or related expenses relating to the Servicer's status or obligations as Servicer (other than any proceeding the Servicer is required to institute under the Servicing Agreement) or (iv) any finding that interest payable to any future REP with respect to disputed funds must be paid by the Issuer or from the Transition Property, except to the extent of Losses either resulting from the willful misconduct, bad faith or gross negligence of such Person seeking indemnification hereunder or resulting from a breach of a representation or warranty made by such Person seeking indemnification hereunder in any of the Basic Documents that gives rise to the Servicer's breach.For purposes of Section 6.02(b), in the event of the termination of the rights and obligations of EGSI (or any successor thereto pursuant to Section 6.03) as Servicer pursuant to Section 7.01, or a resignation by such Servicer pursuant to this Agreement, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer pursuant to Section 7.02.Indemnification under this Section 6.02 shall survive any repeal of, modification of, or supplement to, or judicial invalidation of, the Securitization Law or any Financing Order and shall survive the resignation or removal of the Indenture Trustee or any Independent Manager or the termination of this Agreement and shall include reasonable out-of-pocket fees and expenses of investigation and litigation (including reasonable attorney's fees and expenses).Except to the extent expressly provided in this Agreement or the other Basic Documents (including the Servicer's claims with respect to the Servicing Fee, reimbursement for any Excess Remittance, reimbursement for costs incurred pursuant to Section 5.02(d) and the payment of the purchase price of Transition Property), the Servicer hereby releases and discharges the Issuer, the Independent Managers, and the Indenture Trustee and each of their respective officers, directors and agents (collectively, the "Released Parties") from any and all actions, claims and demands whatsoever, whenever arising, which the Servicer, in its capacity as Servicer or otherwise, shall or may have against any such Person relating to the Transition Property or the Servicer's activities with respect thereto other than any actions, claims and demands arising out of the willful misconduct, bad faith or gross negligence of the Released Parties.Promptly after receipt by an Indemnified Person of notice (or, in the case of the Indenture Trustee, receipt of notice by a Responsible Officer only) of the commencement of any action, proceeding or investigation, such Indemnified Person shall, if a claim in respect thereof is to be made against the Servicer under this Section 6.02, notify the Servicer in writing of the commencement thereof. Failure by an Indemnified Person to so notify the Servicer shall relieve the Servicer from the obligation to indemnify and hold harmless such Indemnified Person under this Section 6.02 only to the extent that the Servicer suffers actual prejudice as a result of such failure. With respect to any action, proceeding or investigation brought by a third party for which indemnification may be sought under this Section 6.02, the Servicer shall be entitled to conduct and control, at its expense and with counsel of its choosing that is reasonably satisfactory to such Indemnified Person, the defense of any such action, proceeding or investigation (in which case the Servicer shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person except as set forth below); provided that the Indemnified Person shall have the right to participate in such action, proceeding or investigation through counsel chosen by it and at its own expense. Notwithstanding the Servicer's election to assume the defense of any action, proceeding or investigation, the Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Servicer shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the defendants in any such action include both the Indemnified Person and the Servicer and the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or additional to those available to the Servicer, (ii) the Servicer shall not have employed counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person within a reasonable time after notice of the institution of such action, (iii) the Servicer shall authorize the Indemnified Person to employ separate counsel at the expense of the Servicer or (iv) in the case of the Indenture Trustee, such action exposes the Indenture Trustee to a material risk of criminal liability or forfeiture or a Servicer Default has occurred and is continuing. Notwithstanding the foregoing, the Servicer shall not be obligated to pay for the fees, costs and expenses of more than one separate counsel for the Indemnified Persons other than one local counsel, if appropriate.The Servicer shall indemnify the PUCT (for the benefit of Customers) for, and defend and hold harmless against, any and all Losses that may be imposed upon, incurred by or asserted against the PUCT, including any increase in the Servicing Fee that becomes payable pursuant to Section 6.06, as a result of a Servicer Default resulting from the Servicer's willful misconduct, bad faith or negligence in performance of its duties or observance of its covenants under this Agreement. The indemnification obligation set forth in this paragraph may be enforced by the PUCT but is not enforceable by any REP or any Customer. Any indemnity payments made to the PUCT under this paragraph for the benefit of Customers shall be remitted to the Indenture Trustee promptly for deposit into the applicable Collection Account.
Appears in 2 contracts
Samples: Transition Property Servicing Agreement (Entergy Gulf States Reconstruction Funding I, LLC), Transition Property Servicing Agreement (Entergy Gulf States Reconstruction Funding I, LLC)
Indemnities of Servicer; Release of Claims. The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement. The Servicer shall indemnify the Issuer, the Indenture Trustee (for itself and for the benefit of the Holders), and the Independent Managers and each of their respective trustees, officers, directors, employees and agents (each, an "Indemnified Person") for, and defend and hold harmless each such Person from and against, any and all Losses imposed on, incurred by or asserted against any such Person as a result of (i) the Servicer's willful misconduct, bad faith or negligence in the performance of its duties or observance of its covenants under this Agreement or its reckless disregard of its obligations and duties under this Agreement, (ii) the Servicer's breach of any of its representations and warranties contained in this Agreement, (iii) any litigation or related expenses relating to the Servicer's status or obligations as Servicer (other than any proceeding the Servicer is required to institute under the Servicing Agreement) or (iv) any finding that interest payable to any future REP with respect to disputed funds must be paid by the Issuer or from the Transition Property, except to the extent of Losses either resulting from the willful misconduct, bad faith or gross negligence of such Person seeking indemnification hereunder or resulting from a breach of a representation or warranty made by such Person seeking indemnification hereunder in any of the Basic Documents that gives rise to the Servicer's breach.. For purposes of Section 6.02(b), in the event of the termination of the rights and obligations of EGSI (or any successor thereto pursuant to Section 6.03) as Servicer pursuant to Section 7.01, or a resignation by such Servicer pursuant to this Agreement, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer pursuant to Section 7.02.Indemnification 7.02. Indemnification under this Section 6.02 shall survive any repeal of, modification of, or supplement to, or judicial invalidation of, the Securitization Law or any Financing Order and shall survive the resignation or removal of the Indenture Trustee or any Independent Manager or the termination of this Agreement and shall include reasonable out-of-pocket fees and expenses of investigation and litigation (including reasonable attorney's fees and expenses).Except expenses). Except to the extent expressly provided in this Agreement or the other Basic Documents (including the Servicer's claims with respect to the Servicing Fee, reimbursement for any Excess Remittance, reimbursement for costs incurred pursuant to Section 5.02(d) and the payment of the purchase price of Transition Property), the Servicer hereby releases and discharges the Issuer, the Independent Managers, and the Indenture Trustee and each of their respective officers, directors and agents (collectively, the "Released Parties") from any and all actions, claims and demands whatsoever, whenever arising, which the Servicer, in its capacity as Servicer or otherwise, shall or may have against any such Person relating to the Transition Property or the Servicer's activities with respect thereto other than any actions, claims and demands arising out of the willful misconduct, bad faith or gross negligence of the Released Parties.. Promptly after receipt by an Indemnified Person of notice (or, in the case of the Indenture Trustee, receipt of notice by a Responsible Officer only) of the commencement of any action, proceeding or investigation, such Indemnified Person shall, if a claim in respect thereof is to be made against the Servicer under this Section 6.02, notify the Servicer in writing of the commencement thereof. Failure by an Indemnified Person to so notify the Servicer shall relieve the Servicer from the obligation to indemnify and hold harmless such Indemnified Person under this Section 6.02 only to the extent that the Servicer suffers actual prejudice as a result of such failure. With respect to any action, proceeding or investigation brought by a third party for which indemnification may be sought under this Section 6.02, the Servicer shall be entitled to conduct and control, at its expense and with counsel of its choosing that is reasonably satisfactory to such Indemnified Person, the defense of any such action, proceeding or investigation (in which case the Servicer shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person except as set forth below); provided that the Indemnified Person shall have the right to participate in such action, proceeding or investigation through counsel chosen by it and at its own expense. Notwithstanding the Servicer's election to assume the defense of any action, proceeding or investigation, the Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Servicer shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the defendants in any such action include both the Indemnified Person and the Servicer and the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or additional to those available to the Servicer, (ii) the Servicer shall not have employed counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person within a reasonable time after notice of the institution of such action, (iii) the Servicer shall authorize the Indemnified Person to employ separate counsel at the expense of the Servicer or (iv) in the case of the Indenture Trustee, such action exposes the Indenture Trustee to a material risk of criminal liability or forfeiture or a Servicer Default has occurred and is continuing. Notwithstanding the foregoing, the Servicer shall not be obligated to pay for the fees, costs and expenses of more than one separate counsel for the Indemnified Persons other than one local counsel, if appropriate.. The Servicer shall indemnify the PUCT (for the benefit of Customers) for, and defend and hold harmless against, any and all Losses that may be imposed upon, incurred by or asserted against the PUCT, including any increase in the Servicing Fee that becomes payable pursuant to Section 6.06, as a result of a Servicer Default resulting from the Servicer's willful misconduct, bad faith or negligence in performance of its duties or observance of its covenants under this Agreement. The indemnification obligation set forth in this paragraph may be enforced by the PUCT but is not enforceable by any REP or any Customer. Any indemnity payments made to the PUCT under this paragraph for the benefit of Customers shall be remitted to the Indenture Trustee promptly for deposit into the applicable Collection Account. Binding Effect of Servicing Obligations. Any Person (a) into which the Servicer may be merged, converted or consolidated, (b) that may result from any reorganization, merger (including, but not limited to, merger as defined in Art. 1.02.A.(18) of the Texas Business Corporation Act or in Section 1.002(55) of the Texas Business Organizations Code, as applicable to the Servicer, as amended from time to time (including, without limitation, any merger commonly referred to as a "merger by division")), conversion or consolidation to which the Servicer shall be a party, or (c) that may acquire or succeed to (whether by merger, division, conversion, consolidation, reorganization, sale, transfer, lease, management contract or otherwise) 1) the properties and assets of the Servicer substantially as a whole, 2) the properties and assets of the Servicer located within the State of Texas substantially as a whole, 3) all or substantially all of the electric transmission and distribution business of the Servicer which is required to provide electric service to the Servicer's customers in the Service Area (or, if transmission and distribution are not provided by a single entity, the distribution business of the Servicer required to provide electric service to the Servicer's Customers in the Service Area), or 4) the distribution system business assets of the Servicer in a portion of the Service Area, and which Person in any of the foregoing cases executes an agreement of assumption to perform all of the obligations of the Servicer hereunder shall be a successor to the Servicer under this Agreement (a "Permitted Successor") without further act on the part of any of the parties to this Agreement; provided, however, that immediately after giving effect to such transaction, no representation, warranty or covenant made pursuant to Section 6.01 shall be breached and no Servicer Default, and no event which, after notice or lapse of time, or both, would become a Servicer Default shall have occurred and be continuing, the Servicer shall have delivered to the Issuer, the Indenture Trustee and each Rating Agency an Officer's Certificate and an Opinion of Counsel from Independent counsel stating that such consolidation, conversion, merger, division, reorganization, sale, transfer, lease, management contract transaction, acquisition or other succession and such agreement of assumption comply with this Section 6.03 and that all conditions precedent, if any, provided for in this Agreement relating to such transaction have been complied with, the Servicer shall have delivered to the Issuer, the Indenture Trustee and each Rating Agency an Opinion of Counsel from Independent counsel of the Servicer either (A) stating that, in the opinion of such counsel, all filings to be made by the Servicer and the Issuer, including filings with the PUCT pursuant to the Securitization Law, have been authorized, executed and filed that are necessary to fully preserve and protect the respective interests of the Issuer and the Indenture Trustee in all of the Transferred Transition Property and reciting the details of such filings, or (B) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interests, the Servicer shall have delivered to the Issuer, the Indenture Trustee, the Rating Agencies and the PUCT an Opinion of Counsel from Independent tax counsel stating that, for federal income tax purposes, notwithstanding such consolidation, conversion, merger, division, reorganization, sale, transfer, lease, management contract transaction, acquisition or other succession and such agreement of assumption, (a) the Issuer will not be subject to tax as an entity separate from its sole owner, (b) the Transition Bonds will be treated as debt of the Issuer's sole owner, and (c) the Transition Bonds will not be treated as transferred in a taxable exchange; and the Servicer shall have given the Rating Agencies prior written notice of such transaction, or, in the case of clause (c)(4) above, the Rating Agency Condition shall be satisfied. When the conditions set forth in this Section 6.03 have been satisfied, the preceding Servicer shall automatically and without further notice (except as provided in clause (v) above) be released from all of its obligations hereunder. When any Person (or more than one Person) acquires the properties and assets of the Servicer substantially as a whole or otherwise becomes the successor, whether by merger, conversion, consolidation, sale, transfer, lease, management contract or otherwise, to all or substantially all of the electric transmission and distribution business of the Servicer (or, if transmission and distribution are not provided by a single entity, provides distribution service directly to Customers taking service at facilities, premises or loads located in the Service Area in accordance with the terms of this Section 6.03), then upon satisfaction of all of the other conditions of this Section 6.03, the preceding Servicer shall automatically and without further notice be released from all of its obligations hereunder.
Appears in 1 contract
Indemnities of Servicer; Release of Claims. The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement. The Servicer shall indemnify the Issuer, the Indenture Trustee (for itself and for the benefit of the Holders), and the Independent Managers and each of their respective trustees, officers, directors, employees and agents (each, an "Indemnified Person") for, and defend and hold harmless each such Person from and against, any and all Losses imposed on, incurred by or asserted against any such Person as a result of (i) the Servicer's willful misconduct, bad faith or negligence in the performance of its duties or observance of its covenants under this Agreement or its reckless disregard of its obligations and duties under this Agreement, (ii) the Servicer's breach of any of its representations and warranties contained in this Agreement, (iii) any litigation or related expenses relating to the Servicer's status or obligations as Servicer (other than any proceeding the Servicer is required to institute under the Servicing Agreement) or (iv) any finding that interest payable to any future REP with respect to disputed funds must be paid by the Issuer or from the Transition Property, except to the extent of Losses either resulting from the willful misconduct, bad faith or gross negligence of such Person seeking indemnification hereunder or resulting from a breach of a representation or warranty made by such Person seeking indemnification hereunder in any of the Basic Documents that gives rise to the Servicer's breach.. For purposes of Section 6.02(b), in the event of the termination of the rights and obligations of EGSI ETI (or any successor thereto pursuant to Section 6.03) as Servicer pursuant to Section 7.01, or a resignation by such Servicer pursuant to this Agreement, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer pursuant to Section 7.02.Indemnification 7.02. Indemnification under this Section 6.02 shall survive any repeal of, modification of, or supplement to, or judicial invalidation of, the Securitization Law or any the Financing Order and shall survive the resignation or removal of the Indenture Trustee or any Independent Manager or the termination of this Agreement and shall include reasonable out-of-pocket fees and expenses of investigation and litigation (including reasonable attorney's fees and expenses).Except expenses). Except to the extent expressly provided in this Agreement or the other Basic Documents (including the Servicer's claims with respect to the Servicing Fee, reimbursement for any Excess Remittance, reimbursement for costs incurred pursuant to Section 5.02(d) and the payment of the purchase price of Transition Property), the Servicer hereby releases and discharges the Issuer, the Independent Managers, and the Indenture Trustee and each of their respective officers, directors and agents (collectively, the "Released Parties") from any and all actions, claims and demands whatsoever, whenever arising, which the Servicer, in its capacity as Servicer or otherwise, shall or may have against any such Person relating to the Transition Property or the Servicer's activities with respect thereto other than any actions, claims and demands arising out of the willful misconduct, bad faith or gross negligence of the Released Parties.. Promptly after receipt by an Indemnified Person of notice (or, in the case of the Indenture Trustee, receipt of notice by a Responsible Officer only) of the commencement of any action, proceeding or investigation, such Indemnified Person shall, if a claim in respect thereof is to be made against the Servicer under this Section 6.02, notify the Servicer in writing of the commencement thereof. Failure by an Indemnified Person to so notify the Servicer shall relieve the Servicer from the obligation to indemnify and hold harmless such Indemnified Person under this Section 6.02 only to the extent that the Servicer suffers actual prejudice as a result of such failure. With respect to any action, proceeding or investigation brought by a third party for which indemnification may be sought under this Section 6.02, the Servicer shall be entitled to conduct and control, at its expense and with counsel of its choosing that is reasonably satisfactory to such Indemnified Person, the defense of any such action, proceeding or investigation (in which case the Servicer shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person except as set forth below); provided that the Indemnified Person shall have the right to participate in such action, proceeding or investigation through counsel chosen by it and at its own expense. Notwithstanding the Servicer's election to assume the defense of any action, proceeding or investigation, the Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Servicer shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the defendants in any such action include both the Indemnified Person and the Servicer and the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or additional to those available to the Servicer, (ii) the Servicer shall not have employed counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person within a reasonable time after notice of the institution of such action, (iii) the Servicer shall authorize the Indemnified Person to employ separate counsel at the expense of the Servicer or (iv) in the case of the Indenture Trustee, such action exposes the Indenture Trustee to a material risk of criminal liability or forfeiture or a Servicer Default has occurred and is continuing. Notwithstanding the foregoing, the Servicer shall not be obligated to pay for the fees, costs and expenses of more than one separate counsel for the Indemnified Persons other than one local counsel, if appropriate.. The Servicer shall indemnify the PUCT (for the benefit of Customers) for, and defend and hold harmless against, any and all Losses that may be imposed upon, incurred by or asserted against the PUCT, including any increase in the Servicing Fee that becomes payable pursuant to Section 6.06, as a result of a Servicer Default resulting from the Servicer's willful misconduct, bad faith or negligence in performance of its duties or observance of its covenants under this Agreement. The indemnification obligation set forth in this paragraph may be enforced by the PUCT but is not enforceable by any REP or any Customer. Any indemnity payments made to the PUCT under this paragraph for the benefit of Customers shall be remitted to the Indenture Trustee promptly for deposit into the applicable Collection Account.
Appears in 1 contract
Samples: Transition Property Servicing Agreement (Entergy Texas Restoration Funding, LLC)
Indemnities of Servicer; Release of Claims. (a) The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement. (b) The Servicer shall indemnify the Issuer, the Indenture Trustee (for itself and for the benefit of the Holders), and the Independent Managers and each of their respective trustees, officers, directors, employees and agents (each, an "“Indemnified Person"”) for, and defend and hold harmless each such Person from and against, any and all Losses imposed on, incurred by or asserted against any such Person as a result of (i) the Servicer's ’s willful misconduct, bad faith or gross negligence in the performance of its duties or observance of its covenants under this Agreement or its reckless disregard of its obligations and duties under this Agreement, (ii) the Servicer's ’s breach of any of its representations and warranties contained in this Agreement, Agreement or (iii) any litigation or related expenses relating to the Servicer's ’s status or obligations as Servicer (other than any proceeding the Servicer is required to institute under the Servicing Agreement) or (iv) any finding that interest payable to any future REP with respect to disputed funds must be paid by the Issuer or from the Transition Property), except to the extent of Losses either resulting from the willful misconduct, bad faith or gross negligence of such Person seeking indemnification hereunder or resulting from a breach of a representation or warranty made by such Person seeking indemnification hereunder in any of the Basic Documents that gives rise to the Servicer's ’s breach.. (c) For purposes of Section 6.02(b), in the event of the termination of the rights and obligations of EGSI EAI (or any successor thereto pursuant to Section 6.03) as Servicer pursuant to Section 7.01, or a resignation by such Servicer pursuant to this Agreement, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer pursuant to Section 7.02.Indemnification 7.02. (d) Indemnification under this Section 6.02 shall survive any repeal of, modification of, or supplement to, or judicial invalidation of, the Securitization Law Act or any the Financing Order and shall survive the resignation or removal of the Indenture Trustee or any Independent Manager or the termination of this Agreement and shall include reasonable out-of-pocket fees and expenses of investigation and litigation (including reasonable attorney's ’s fees and expenses).Except expenses). (e) Except to the extent expressly provided in this Agreement or the other Basic Documents (including the Servicer's ’s claims with respect to the Servicing Fee, reimbursement for any Excess Remittance, reimbursement for costs incurred pursuant to Section 5.02(d) and the payment of the purchase price of Transition Storm Recovery Property), the Servicer hereby releases and discharges the Issuer, the Independent Managers, and the Indenture Trustee and each of their respective officers, directors and agents (collectively, the "“Released Parties"”) from any and all actions, claims and demands whatsoever, whenever arising, which the Servicer, in its capacity as Servicer or otherwise, shall or may have against any such Person relating to the Transition Storm Recovery Property or the Servicer's ’s activities with respect thereto other than any actions, claims and demands arising out of the willful misconduct, bad faith or gross negligence of the Released Parties.. (f) Promptly after receipt by an Indemnified Person of notice (or, in the case of the Indenture Trustee, receipt of notice by a Responsible Officer only) of the commencement of any action, proceeding or investigation, such Indemnified Person shall, if a claim in respect thereof is to be made against the Servicer under this Section 6.02, notify the Servicer in writing of the commencement thereof. Failure by an Indemnified Person to so notify the Servicer shall relieve the Servicer from the obligation to indemnify and hold harmless such Indemnified Person under this Section 6.02 only to the extent that the Servicer suffers actual prejudice as a result of such failure. With respect to any action, proceeding or investigation brought by a third party for which indemnification may be sought under this Section 6.02, the Servicer shall be entitled to conduct and control, at its expense and with counsel of its choosing that is reasonably satisfactory to such Indemnified Person, the defense of any such action, proceeding or investigation (in which case the Servicer shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person except as set forth below); provided that the Indemnified Person shall have the right to participate in such action, proceeding or investigation through counsel chosen by it and at its own expense. Notwithstanding the Servicer's ’s election to assume the defense of any action, proceeding or investigation, the Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Servicer shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the defendants in any such action include both the Indemnified Person and the Servicer and the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or additional to those available to the Servicer, (ii) the Servicer shall not have employed counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person within a reasonable time after notice of the institution of such action, (iii) the Servicer shall authorize the Indemnified Person to employ separate counsel at the expense of the Servicer or (iv) in the case of the Indenture Trustee, such action exposes the Indenture Trustee to a material risk of criminal liability or forfeiture or a Servicer Default has occurred and is continuing. Notwithstanding the foregoing, the Servicer shall not be obligated to pay for the fees, costs and expenses of more than one separate counsel for the Indemnified Persons other than one local counsel, if appropriate.. SECTION 6.03. Merger or Other Succession to, and Assumption of, the Obligations of the Servicer . Any Person: (a) into which the Servicer may be merged or consolidated and which succeeds to all or the major part of the electric distribution business of the Servicer, (b) which results from the division of the Servicer into two or more Persons and which succeeds to all or the major part of the electric distribution business of the Servicer, (c) which may result from any merger or consolidation to which the Servicer shall be a party and which succeeds to all or the major part of the electric distribution business of the Servicer, (d) which may succeed to the properties and assets of the Servicer substantially as a whole and which succeeds to all or the major part of the electric distribution business of the Servicer, or (e) which may otherwise succeed to all or the major part of the electric distribution business of the Servicer, which Person in any of the foregoing cases executes an agreement of assumption to perform every obligation of the Servicer under this Agreement, shall be a Successor Servicer 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 Section 6.01 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 Servicer shall have delivered to the Issuer, the APSC, the Trustee and the Rating Agencies an Officer’s Certificate and an Opinion of Counsel each stating that such consolidation, merger, division, sale, transfer or other succession and such agreement of assumption comply with this Section 6.03 and that all conditions precedent, if any, provided for in this Agreement relating to such transaction have been complied with; (iii) the Servicer shall have delivered to the Issuer, the Trustee, the APSC and the Rating Agencies an Opinion of Counsel stating that, in the opinion of such counsel, either: (A) all filings to be made by the Servicer, including filings under the Statute and the UCC, that are necessary fully to preserve and protect the interests of the Trustee in the applicable Storm Recovery Property have been executed and filed and reciting the details of such filings, or (B) no such action is necessary to preserve and protect such interests; and (iv) the Servicer shall have delivered to the Issuer, the Indenture Trustee, the Rating Agencies and the APSC an Opinion of Counsel from Independent tax counsel stating that, for federal income tax purposes, notwithstanding such consolidation, merger, division, sale, transfer or other succession and such agreement of assumption, (a) the Issuer will not be subject to tax as an entity separate from its sole owner, (b) the Storm Recovery Bonds will be treated as debt of the Issuer’s sole owner, and (c) the Storm Recovery Bonds will not be treated as transferred in a taxable exchange; and (v) the Servicer shall have given the Rating Agencies prior written notice of such transaction. The Servicer shall indemnify not consummate any transaction referred to in clauses (a), (b), (c), (d), or (e) above except upon execution of the PUCT above-described agreement of assumption and compliance with subclauses (for the benefit of Customers) fori), (ii), (iii), and defend (iv) of clause (e) above. When any Person acquires the properties and hold harmless against, any and all Losses that may be imposed upon, incurred by or asserted against assets of the PUCT, including any increase in the Servicing Fee that becomes payable pursuant to Section 6.06, Servicer substantially as a result of a Servicer Default resulting from whole and becomes the Servicer's willful misconduct, bad faith or negligence in performance of its duties or observance of its covenants under this Agreement. The indemnification obligation set forth in this paragraph may be enforced by the PUCT but is not enforceable by any REP or any Customer. Any indemnity payments made successor to the PUCT under Servicer in accordance with the terms of this paragraph for Section 6.03, then upon the benefit satisfaction of Customers all of the other conditions of Section 5.04 and of this Section 6.03, the Servicer shall automatically and without further notice be remitted to the Indenture Trustee promptly for deposit into the applicable Collection Accountreleased from its obligations hereunder. SECTION 6.04.
Appears in 1 contract
Samples: Property Servicing Agreement
Indemnities of Servicer; Release of Claims. (a) The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement. (b) The Servicer shall indemnify the Issuer, Issuer and the Indenture Trustee (Trustee, for itself and for the benefit on behalf of the Holders)Environmental Control Bondholders for which it acts as Indenture Trustee, and the Independent Managers and each of their respective trusteesmanagers, members, officers, directors, employees and agents (each, an "Indemnified Person") for, and defend and hold harmless each such Person from and against, any and all Losses that may be imposed onupon, incurred by or asserted against any such Person as a result of (i) the Servicer's ’s willful misconduct, bad faith or negligence in the performance of its duties or observance of its covenants under this 11 Agreement or its reckless disregard of its obligations and duties under this Agreement, (ii) the Servicer's ’s material breach of any of its obligations, duties, representations or warranties that results in a Servicer Default under this Agreement and warranties contained in this Agreement, (iii) any litigation or and related expenses relating to the Servicer's its status or and obligations as Servicer. The Servicer (other than shall not be liable for any proceeding the Servicer is required to institute under the Servicing Agreement) or (iv) any finding that interest payable to any future REP with respect to disputed funds must be paid by the Issuer or from the Transition Property, except to the extent of Losses either resulting from the willful misconduct, bad faith or gross negligence of such any Person seeking indemnification hereunder indemnified pursuant to this Section 5.02 (each, an “Indemnified Party”) or resulting from a breach of a representation or warranty made by such Person seeking indemnification hereunder Indemnified Party in any of the Basic Documents that gives rise to the Servicer's ’s breach.For purposes . The Environmental Control Bondholders shall be entitled to enforce their rights and remedies against the Servicer under this Section 5.02 solely through a case of action brought for their benefit by the Indenture Trustee. The Servicer’s indemnification under this Section 6.02(b), in the event of 5.02(b) shall survive the termination of the rights and obligations of EGSI (or any successor thereto pursuant to Section 6.03) as Servicer pursuant to Section 7.01, or a resignation by such Servicer pursuant to this Agreement, such and any amounts paid with respect thereto shall be remitted and deposited with the Indenture Trustee for deposit into the Collection Account (c) The Servicer shall indemnify the PSCWV, on behalf of the Customers, for any Losses they incur by reason of the Servicer’s willful misconduct, bad faith or negligence including without limitation Losses attributable to higher Environmental Control Charges imposed on customers by reason of additional Operating Expenses, for example the Issuer’s higher Servicing Fees payable to a Successor Servicer. The PSCWV shall be deemed entitled to be enforce Section 5.02(c) for the Servicer pending appointment benefit of a successor Servicer pursuant to Section 7.02.Indemnification Customers, and Customers may not enforce this indemnity. The Servicer’s indemnification under this Section 6.02 5.02(c) shall survive the termination of this Agreement, and any repeal ofamounts paid with respect thereto shall be remitted and deposited with the Indenture Trustee for deposit into the Collection Account, modification ofunless otherwise directed by the PSCWV. (d) The Servicer shall indemnify the Indenture Trustee and its officers, directors and agents for, and defend and hold harmless each such Person from and against, any and all Losses that may be imposed upon, incurred by or asserted against any such Person as a result of the acceptance or performance of the trusts and duties contained herein and in the other Basic Documents to which the Indenture Trustee is a party, except to the extent that any such Loss shall be due to the willful misconduct, bad faith or negligence of the Indenture Trustee. The foregoing indemnity is extended to the Indenture Trustee solely in its individual capacity and not for the benefit of the Environmental Control Bondholders or any other Person. Such amounts shall be deposited and distributed in accordance with the Indenture. (e) The Servicer’s indemnification obligations under Sections 5.02(b),(c) and (d) for events occurring prior to the removal or resignation of the Indenture Trustee, or supplement tothe termination of this Agreement with respect to the Issuer, or judicial invalidation of, the Securitization Law or any Financing Order and shall survive the resignation or removal of the Indenture Trustee or any Independent Manager or the termination of this Agreement with respect to the Issuer, and shall include reasonable out-of-pocket costs, fees and expenses of investigation and litigation (including the Issuer’s and the Indenture Trustee’s reasonable attorney's attorneys’ fees and expenses).Except expenses). (f) Except to the extent expressly provided for in this Agreement or the other Basic Documents (including the Servicer's ’s claims with respect to the Servicing Fee, reimbursement for any Excess Remittance, reimbursement for costs incurred pursuant to Section 5.02(d) Fees and the Seller’s claim for payment of the purchase price of Transition the Transferred Environmental Control Property), the Servicer hereby releases and discharges the IssuerIssuer (including its respective managers, the Independent Managersmembers, officers, directors and agents, if any) and the Indenture Trustee and each of their respective (including 12 its officers, directors and agents agents) (collectively, the "“Released Parties"”) from any and all actions, claims and demands whatsoever, whenever arising, which the Servicer, in its capacity as Servicer or otherwiseServicer, shall or may have against any such Person relating to the Transition Transferred Environmental Control Property or the Servicer's ’s activities with respect thereto other than any actions, claims and demands arising out of the willful misconduct, bad faith or gross negligence of the Released Parties.Promptly after receipt by an Indemnified Person of notice . (or, in the case of the Indenture Trustee, receipt of notice by a Responsible Officer onlyg) of the commencement of If any action, claim, demand or proceeding (including any governmental investigation) shall be brought or investigationasserted against an Indemnified Party entitled to any indemnification provided for under this Section 5.02, such Indemnified Person shall, if a claim in respect thereof is to be made against the Servicer under this Section 6.02, Party shall promptly notify the Servicer in writing of writing; provided, however, that failure to give such notification shall not affect the commencement thereof. Failure by an Indemnified Person indemnification provided hereunder except to so notify the extent the Servicer shall relieve the Servicer from the obligation to indemnify and hold harmless such Indemnified Person under this Section 6.02 only to the extent that the Servicer suffers actual prejudice have been actually prejudiced as a result of such failure. With respect SECTION 5.03 Merger or Consolidation of, or Assumption of the Obligations of, Servicer. Any Person (a) into which the Servicer may be merged or consolidated and which succeeds to any actionmaterial part of the electric distribution business of the Servicer, proceeding (b) which results from the division of the Servicer into two or investigation brought by a third party for more Persons and which indemnification succeeds to any material part of the electric distribution business of the Servicer, (c) which may be sought under this Section 6.02, result from any merger or consolidation to which the Servicer shall be entitled a party and which succeeds to conduct any material part of the electric distribution business of the Servicer, (d) which may succeed to the properties and controlassets of the Servicer substantially as a whole and which succeeds to any material part of the electric distribution business of the Servicer or (e) which may otherwise succeed to any material part of the electric distribution business of the Servicer, at its expense and with counsel which Person in any of its choosing that is reasonably satisfactory the foregoing cases executes an agreement of assumption to such Indemnified Personperform every obligation of the Servicer hereunder, shall be the defense successor to the Servicer under this Agreement without further act on the part of any such actionof the parties to this Agreement; provided, proceeding or investigation (in which case the Servicer shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person except as set forth below); provided however, that the Indemnified Person shall have the right to participate in such action, proceeding or investigation through counsel chosen by it and at its own expense. Notwithstanding the Servicer's election to assume the defense of any action, proceeding or investigation, the Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Servicer shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the defendants in any immediately after giving effect to such action include both the Indemnified Person transaction, no representation and the Servicer and the Indemnified Person warranty made pursuant to Section 5.01 shall have reasonably concluded that there may been breached and no Servicer Default, and no event which, after notice or lapse of time, or both, would become a Servicer Default, shall have occurred and be legal defenses available to it that are different from or additional to those available to the Servicercontinuing, (ii) the Servicer shall not have employed counsel reasonably satisfactory delivered to the Indemnified Person Issuer, the PSCWV and the Indenture Trustee an Officers’ Certificate and an Opinion of Counsel stating that such consolidation, merger or succession and such agreement of assumption comply with this Section 5.03 and that all conditions precedent provided for in this Agreement relating to represent the Indemnified Person within a reasonable time after notice of the institution of such actiontransaction have been complied with, (iii) the Servicer Rating Agencies shall authorize the Indemnified Person to employ separate counsel at the expense have received prior written notice of the Servicer or such transaction, (iv) in the case of Servicer shall have delivered to the Issuer, the Indenture Trustee, the PSCWV and each Rating Agency an Opinion of Counsel either stating that, in the opinion of such counsel, (A) all filings, including filings with the PSCWV pursuant to the Statute, have been executed and filed that are necessary to preserve fully and protect fully the interests of the Issuer in the Transferred Environmental Control Property and reciting the details of such filings or (B) no such action exposes the Indenture Trustee shall be necessary to a material risk of criminal liability or forfeiture or a Servicer Default has occurred preserve and is continuingprotect such interests. Notwithstanding anything herein to the foregoingcontrary, the Servicer execution of the above referenced agreement of assumption and compliance with clauses (i), (ii), (iii) and (iv) above shall not be obligated to pay for the fees, costs and expenses of more than one separate counsel for the Indemnified Persons other than one local counsel, if appropriate.The Servicer shall indemnify the PUCT (for the benefit of Customers) for, and defend and hold harmless against, any and all Losses that may be imposed upon, incurred by or asserted against the PUCT, including any increase in the Servicing Fee that becomes payable pursuant to Section 6.06, as a result of a Servicer Default resulting from the Servicer's willful misconduct, bad faith or negligence in performance of its duties or observance of its covenants under this Agreement. The indemnification obligation set forth in this paragraph may be enforced by the PUCT but is not enforceable by any REP or any Customer. Any indemnity payments made conditions precedent to the PUCT under this paragraph for consummation of the benefit of Customers shall be remitted transactions referred to the Indenture Trustee promptly for deposit into the applicable Collection Account.in clause (a), (b), (c), (d) or (e) above. SECTION 5.04
Appears in 1 contract
Samples: Servicing Agreement
Indemnities of Servicer; Release of Claims. (a) The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement. The (i)The Servicer shall indemnify the Issuer, the Indenture Trustee (for itself and for the benefit of the Holders), and the each Independent Managers Manager and each of their respective trustees, officers, directors, employees and agents (each, an "“Indemnified Person"”) for, and defend and hold harmless each such Person from and against, any and all Losses imposed on, incurred by or asserted against any such Person as a result of (i) the Servicer's ’s willful misconduct, bad faith or gross negligence in the performance of its duties or observance of its covenants under this Agreement or its reckless disregard of its obligations and duties under this Agreement, (ii) the Servicer's ’s breach of any of its representations and warranties contained in this Agreement, or (iii) any litigation or related expenses relating to the Servicer's ’s status or obligations as Servicer (other than any proceeding the Servicer is required to institute under the Servicing Agreement) or (iv) any finding that interest payable to any future REP with respect to disputed funds must be paid by the Issuer or from the Transition Property), except to the extent of Losses either resulting from the willful misconduct, bad faith or gross negligence of such Person seeking indemnification hereunder or resulting from a breach of a representation or warranty made by such Person seeking indemnification hereunder in any of the Basic Documents that gives rise to the Servicer's ’s breach.For . (j)For purposes of Section 6.02(b), in the event of the termination of the rights and obligations of EGSI ENO (or any successor thereto pursuant to Section 6.03) as Servicer pursuant to Section 7.01, or a resignation by such Servicer pursuant to this Agreement, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer pursuant to Section 7.02.Indemnification 7.02. (k)Indemnification under this Section 6.02 shall survive any repeal of, modification of, or supplement to, or judicial invalidation of, the Storm Recovery Securitization Law or any the Financing Order and shall survive the resignation or removal of the Indenture Trustee or any Independent Manager or the termination of this Agreement and shall include reasonable out-of-pocket fees and expenses of investigation and litigation (including reasonable attorney's ’s fees and expenses).Except expenses). (l)Except to the extent expressly provided in this Agreement or the other Basic Documents (including the Servicer's ’s claims with respect to the Servicing Fee, reimbursement for any Excess Remittance, reimbursement for costs incurred pursuant to Section 5.02(d) and the payment of the purchase price of Transition Storm Recovery Property), the Servicer hereby releases and discharges the Issuer, the Independent ManagersManager(s), and the Indenture Trustee and each of their respective officers, directors and agents (collectively, the "“Released Parties"”) from any and all actions, claims and demands whatsoever, whenever arising, which the Servicer, in its capacity as Servicer or otherwise, shall or may have against any such Person relating to the Transition Storm Recovery Property or the Servicer's ’s activities with respect thereto other than any actions, claims and demands arising out of the willful misconduct, bad faith or gross negligence of the Released Parties.. (m)The Servicer shall not be required to indemnify an Indemnified Person for any amount paid or payable by such Indemnified Person in the settlement of any action, proceeding or investigation without the written consent of the Servicer, which consent shall not be unreasonably withheld. Promptly after receipt by an Indemnified Person of notice (or, in the case of the Indenture Trustee, receipt of notice by a Responsible Officer only) of the commencement of any action, proceeding or investigation, such Indemnified Person shall, if a claim in respect thereof is to be made against the Servicer under this Section 6.02, notify the Servicer in writing of the commencement thereof. Failure by an Indemnified Person to so notify the Servicer shall relieve the Servicer from the obligation to indemnify and hold harmless such Indemnified Person under this Section 6.02 only to the extent that the Servicer suffers actual prejudice as a result of such failure. With respect to any action, proceeding or investigation brought by a third party for which indemnification may be sought under this Section 6.02, the Servicer shall be entitled to conduct and control, at its expense and with counsel of its choosing that is reasonably satisfactory to such Indemnified Person, the defense of any such action, proceeding or investigation (in which case the Servicer shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person except as set forth below); provided that the Indemnified Person shall have the right to participate in such action, proceeding or investigation through counsel chosen by it and at its own expense. Notwithstanding the Servicer's ’s election to assume the defense of any action, proceeding or investigation, the Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Servicer shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the defendants in any such action include both the Indemnified Person and the Servicer and the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or additional to those available to the Servicer, (ii) the Servicer shall not have employed counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person within a reasonable time after notice of the institution of such action, (iii) the Servicer shall authorize the Indemnified Person to employ separate counsel at the expense of the Servicer or (iv) in the case of the Indenture Trustee, such action exposes the Indenture Trustee to a material risk of criminal liability or forfeiture or a Servicer Default has occurred and is continuing. Notwithstanding the foregoing, the Servicer shall not be obligated to pay for the fees, costs and expenses of more than one separate counsel for the Indemnified Persons other than one local counsel, if appropriate.. The Servicer shall indemnify will not, without the PUCT (for prior written consent of the benefit Indemnified Person, settle or compromise or consent to the entry of Customers) forany judgment with respect to any pending or threatened claim, and defend and hold harmless againstaction, any and all Losses that suit or proceeding in respect of which indemnification may be imposed upon, incurred by or asserted against the PUCT, including any increase in the Servicing Fee that becomes payable pursuant to Section 6.06, as a result of a Servicer Default resulting from the Servicer's willful misconduct, bad faith or negligence in performance of its duties or observance of its covenants sought under this AgreementSection 6.02 (whether or not the Indemnified Person is an actual or potential party to such claim or action) unless such settlement, compromise or consent includes an unconditional release of the Indemnified Person from all liability arising out of such claim, action, suit or proceeding. The indemnification obligation set forth in this paragraph may be enforced by the PUCT but is not enforceable by any REP or any Customer. Any indemnity payments made to the PUCT under this paragraph for the benefit of Customers shall be remitted to the Indenture Trustee promptly for deposit into the applicable Collection AccountSECTION 6.03.
Appears in 1 contract
Samples: Servicing Agreement
