TRANSITION PROPERTY PURCHASE AND SALE AGREEMENT
between
WMECO FUNDING LLC
Note Issuer
and
WESTERN MASSACHUSETTS ELECTRIC COMPANY
Seller
Dated as of May 17, 2001
This TRANSITION PROPERTY PURCHASE AND SALE AGREEMENT, dated as of May
17, 2001, is between WMECO Funding LLC, a Delaware limited liability company
(the "Note Issuer"), and Western Massachusetts Electric Company, a
Massachusetts corporation (together with its successors in interest to the
extent permitted hereunder, the "Seller").
RECITALS
WHEREAS, the Note Issuer desires to purchase the Transition Property (as
defined herein) created pursuant to the Statute and the Financing Order (each
as defined herein); and
WHEREAS, the Seller is willing to sell the Transition Property to the
Note Issuer.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings:
"Administration Agreement" means the Administration Agreement dated as
of May 17, 2001 between Western Massachusetts Electric Company, as
Administrator, and the Note Issuer, as amended and supplemented from time to
time.
"Agencies" means, collectively, the Massachusetts Development Finance
Agency and the Massachusetts Health and Educational Facilities Authority.
"Agreement" means this Transition Property Purchase and Sale Agreement,
as amended and supplemented from time to time.
"Authorized Officer" means an officer of the Seller listed on the list
of Authorized Officers delivered by the Seller to the Note Trustee and the
Certificate Trustee on the date of issuance of the Certificates (as such list
may be modified or supplemented by the Seller from time to time).
"Back-Up Security Interest" has the meaning specified in Section 2.01.
"Basic Documents" means, collectively, this Agreement, the Note
Indenture, the Declaration of Trust, the Certificate Indenture, the Servicing
Agreement, the Administration Agreement, the Note Purchase Agreement, the
Underwriting Agreement and the Fee and Indemnity Agreement.
"Business Day" means any day other than a Saturday, a Sunday or a day on
which banking institutions or trust companies in New York, New York, Boston,
Massachusetts, Hartford, Connecticut or Wilmington, Delaware are authorized
or obligated by law, regulation or executive order to remain closed.
"Capital Subaccount" has the meaning specified in Section 8.02(a) of the
Note Indenture.
"Certificate Indenture" means the Certificate Indenture dated as of May
17, 2001, between the Certificate Issuer and the Certificate Trustee, as
amended and supplemented from time to time.
"Certificate Trustee" means the Person acting as trustee under the
Certificate Indenture.
"Certificateholders" has the meaning specified in Section 1.01(a) of the
Certificate Indenture.
"Certificates" means the Massachusetts RRB Special Purpose Trust WMECO-1
Rate Reduction Certificates issued under the Certificate Indenture.
"Closing Date" means May 17, 2001.
"Collection Account" has the meaning specified in Section 8.02(a) of the
Note Indenture.
"Corporate Trust Office" has the meaning specified in Section 1.01(a) of
the Note Indenture.
"Customers" means all of Seller's customers or ratepayers taking the
delivery, transmission, distribution, back-up, maintenance, emergency and any
other delivery or energy service provided by Seller to customers within the
territory in which it serves customers, regardless of any such customer's
source of electric power.
"Date of Breach" means, with respect to the repurchase obligation
specified in Section 5.01(b), the date of a breach of a representation or
warranty that triggers such repurchase obligation.
"Declaration of Trust" means the Declaration of Trust dated as of May
15, 2001, among the Agencies and the Delaware Trustee, as amended and
supplemented from time to time.
"Delaware Trustee" means the Person acting as trustee under the
Declaration of Trust.
"DTE" means the Massachusetts Department of Telecommunications and
Energy and any successor thereto.
"DTE Regulations" has the meaning specified in Section 1.01 of the
Servicing Agreement.
"Fee and Indemnity Agreement" means the Fee and Indemnity Agreement
dated as of May 17, 2001 among the Note Issuer, the Delaware Trustee, the
Certificate Trustee, the Trust and the Agencies, as amended and supplemented
from time to time.
"Financing Order" means the order of the DTE, DTE-00-40 , issued on
February 7, 2001.
"Fitch" means Fitch, Inc. or its successor.
"Grant" means mortgage, pledge, collaterally assign and xxxxx x xxxx
upon and a security interest in. A Grant of any agreement or instrument
shall include all rights, powers and options (but none of the obligations) of
the Granting Person thereunder, the immediate and continuing right to claim
for, collect, receive and give receipts for payments in respect of and all
other monies 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 Person or
otherwise, and generally to do and receive anything that the Granting Person
is or may be entitled to do or receive thereunder with respect thereto.
"Indemnified Person" has the meaning specified in Section 5.01(c),
Section 5.01(d), Section 5.01(e) or in Section 5.01(h), for the purposes set
forth therein.
"Independent" has the meaning specified in Section 1.01(a) of the Note
Indenture.
"Issuance Advice Letter" means the initial Issuance Advice Letter, dated
May 16, 2001, filed with the DTE by the Seller pursuant to the Financing
Order.
"Issuance Date" has the meaning specified in Section 2.01(c)(i) of the
Note Indenture.
"Lien" means a security interest, lien, charge, pledge or encumbrance of
any kind.
"Losses" has the meaning specified in Section 5.01(e).
"Moody's" means Xxxxx'x Investors Service, Inc. or its successor.
"Note Indenture" means the Note Indenture dated as of May 17, 2001,
between the Note Issuer and the Note Trustee, as amended and supplemented
from time to time.
"Note Issuer" has the meaning set forth in the preamble of this
Agreement.
"Note Purchase Agreement" means the Note Purchase Agreement dated as of
May 17, 2001 between the Note Issuer and the Trust, as amended and
supplemented from time to time.
"Note Register" has the meaning specified in Section 2.05 of the Note
Indenture.
"Note Trustee" means the Person acting as trustee under the Note
Indenture.
"Noteholder" or "Holder" means the Person in whose name a Note is
registered on the Note Register.
"Notes" means the WMECO Funding LLC Notes issued under the Note
Indenture.
"Officer's Certificate" means a certificate signed by the chairman of
the board, the chief executive officer, the president, the vice chairman of
the board, any vice president, the treasurer, any assistant treasurer, the
clerk, any assistant clerk, the controller or the finance manager of the
Seller.
"Operating Expense" has the meaning specified in Section 1.01(a) of the
Note Indenture.
"Opinion of Counsel" means one or more written opinions of counsel who
may be an employee of or counsel to the party providing such opinion of
counsel, which counsel shall be reasonably acceptable to the party receiving
such opinion of counsel.
"Outstanding Amount" has the meaning specified in Section 1.01(a) of the
Note Indenture.
"Overcollateralization Subaccount" has the meaning specified in Section
8.02(a) of the Note Indenture.
"Person" means any individual, corporation, limited liability company,
estate, partnership, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization or
government or any agency or political subdivision thereof.
"Rating Agencies" means, collectively, S&P, Xxxxx'x and Fitch.
"Repurchase Date" means the date that is five Business Days after the
date that is (i) if the terms of Section 5.01(b)(i)(A) and Section
5.01(b)(i)(B)(2) are applicable, two Business Days after the Date of Breach
if the Seller fails to make the deposit required by Section 5.01(b)(i)(B)(2)
or 90 days after the Date of Breach if the Seller makes the deposit required
by Section 5.01(b)(i)(B)(2); (ii) if the terms of Section 5.01(b)(ii) are
applicable, 90 days after the Date of Breach; and (iii) if the terms of
Section 5.01(b)(i)(A) and Section 5.01(b)(i)(B)(1) are applicable, 90 days
after the Date of Breach.
"Repurchase Price" has the meaning specified in Section 5.01(b)(i).
"Required Overcollateralization Level" has the meaning specified in
Section 1.01(a) of the Note Indenture.
"RTC Charge" means the portion (which may become all) of the Transition
Charge designated pursuant to the Financing Order as the RTC Charge, as the
same may be adjusted from time to time as provided in the Financing Order,
and may in the future include a pro rata component of any exit fee collected
pursuant to Section 1G(g) of Chapter 164 of the Massachusetts General Laws.
"RTC Charge Collections" has the meaning specified in Section 1.01 of
the Servicing Agreement.
"Seller" has the meaning set forth in the preamble of this Agreement.
"Servicer Default" means an event specified in Section 7.01 of the
Servicing Agreement.
"Servicing Agreement" means the Transition Property Servicing Agreement
dated as of May 17, 2001 between Western Massachusetts Electric Company, as
Servicer, and the Note Issuer, as amended and supplemented from time to time.
"S&P" means Standard & Poor's Ratings Services, a division of The McGraw
Hill Companies, Inc. or its successor.
"Statute" means Chapter 164 of the Massachusetts Acts of 1997, entitled
An Act Relative to Restructuring the Electric Utility Industry in the
Commonwealth, Regulating the Provision of Electricity and Other Services, and
Promoting Enhanced Consumer Protections Therein.
"Transition Charge" means the "Transition Charge" as defined in the
Statute and referred to as the Seller's "Transition Charge" in Western
Massachusetts Electric Company's Restructuring Order, DTE Docket No. 97-120
and subsequent filings with the DTE pursuant thereto.
"Transition Property" means the transition property that exists under
Order 7 of the Financing Order.
"Trust" or "Certificate Issuer" means Massachusetts RRB Special Purpose
Trust WMECO-1, a Delaware business trust.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from
time to time.
"Underwriting Agreement" means the Underwriting Agreement dated as of
May 14, 2001 among Western Massachusetts Electric Company, the Note Issuer
and the underwriters named therein.
Section 1.02. Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(b) The words "hereof," "herein," "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement; Section, Schedule and
Exhibit references contained in this Agreement are references to Sections,
Schedules and Exhibits in or to this Agreement unless otherwise specified;
and the term "including" shall mean "including without limitation".
(c) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms.
ARTICLE 2
CONVEYANCE OF TRANSITION PROPERTY
Section 2.01. Conveyance of Transition Property. In consideration of
the Note Issuer's delivery to or upon the order of the Seller of
$153,964,509.50, the Seller does hereby irrevocably sell, transfer, assign,
set over and otherwise convey to the Note Issuer, WITHOUT RECOURSE OR
WARRANTY, except as specifically set forth herein, all right, title and
interest of the Seller in and to the Transition Property (such sale,
transfer, assignment, setting over and conveyance of the Transition Property
includes, to the fullest extent permitted by the Statute, the assignment of
all revenues, collections, claims, payments, money or proceeds of or arising
from the RTC Charge pursuant to the Financing Order) and copies of all books
and records related thereto. Such sale, transfer, assignment, setting over
and conveyance is hereby expressly stated to be a sale and, pursuant to
Section 1H(f)(1) of Chapter 164 of the Massachusetts General Laws, shall be
treated as an absolute transfer of all of the Seller's right, title and
interest in (as in a true sale), and not as a pledge or other financing of,
the Transition Property. If such sale, transfer, assignment, setting over
and conveyance is held by any court of competent jurisdiction not to be a
true sale as provided in Section 1H(f)(1) of Chapter 164 of the Massachusetts
General Laws, then such sale, transfer, assignment, setting over and
conveyance shall be treated as the creation of a security interest in the
Transition Property and, without prejudice to its position that it has
absolutely transferred all of its rights in the Transition Property to the
Note Issuer, the Seller hereby Grants to the Note Issuer a security interest
in the Transition Property (including, to the fullest extent permitted by the
Statute, the assignment of all revenues, collections, claims, payments, money
or proceeds of or arising from the RTC Charge pursuant to the Financing
Order) to secure a payment obligation incurred by the Seller in respect of
the amount paid by the Note Issuer to the Seller pursuant to this Agreement
(the "Back-Up Security Interest"). Such sale, transfer, assignment, setting
over and conveyance of the Transition Property includes the right to use the
Seller's computer software system to access and create copies of all books
and records related to the Transition Property.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER
Subject to Section 3.09 hereof, the Seller makes the following
representations and warranties, as of the Closing Date, on which the Note
Issuer has relied in acquiring the Transition Property.
Section 3.01. Organization and Good Standing. The Seller is duly
organized and validly existing as a corporation in good standing under the
laws of The Commonwealth of Massachusetts, with the requisite corporate power
and authority to own its properties as such properties are currently owned
and to conduct its business as such business is now conducted by it, and has
the requisite corporate power and authority to own the Transition Property.
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 shall require such
qualifications, licenses or approvals (except where the failure to so qualify
or obtain such licenses and approvals would not be reasonably likely to have
a material adverse effect on the Seller's business, operations, assets,
revenues or properties).
Section 3.03. Power and Authority. The Seller has the requisite
corporate power and authority to execute and deliver this Agreement and to
carry out its terms; and the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of the Seller.
Section 3.04. Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Seller enforceable against it in
accordance with its terms, subject to applicable insolvency, reorganization,
moratorium, fraudulent transfer and other laws relating to or affecting
creditors' or secured parties' rights generally from time to time in effect
and to general principles of equity (including concepts of materiality,
reasonableness, good faith and fair dealing), regardless of whether
considered in a proceeding in equity or at law.
Section 3.05. No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof do
not: (i) conflict with or result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of time) a
default under, the articles of organization or by-laws of the Seller, or any
material indenture, agreement or other instrument to which the Seller is a
party or by which it is bound; (ii) result in the creation or imposition of
any Lien upon any of the Seller's properties pursuant to the terms of any
such indenture, agreement or other instrument (other than any Lien that may
be granted under the Basic Documents or any Lien created pursuant to Section
1H(e) of Chapter 164 of the Massachusetts General Laws); or (iii) violate any
existing law or any existing 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.
Section 3.06. No Proceedings. There are no proceedings pending and, to
the Seller's knowledge, there are no proceedings threatened and, to the
Seller's knowledge, there are no investigations pending or threatened, before
any court, federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Seller or its
properties involving or relating to the Seller or the Note Issuer or, to the
Seller's knowledge, any other Person: (i) asserting the invalidity of this
Agreement, any of the other Basic Documents, the Notes, the Certificates, the
Statute or the Financing Order, (ii) seeking to prevent the issuance of the
Notes or the Certificates or the consummation of any of the transactions
contemplated by this Agreement or any of the other Basic Documents, (iii)
seeking any determination or ruling that might materially and adversely
affect the performance by the Seller of its obligations under, or the
validity or enforceability of, this Agreement, any of the other Basic
Documents, the Notes or the Certificates or (iv) seeking to adversely affect
the federal or state income tax classification of the Notes or the
Certificates as debt.
Section 3.07. Approvals. No approval, authorization, consent, order or
other action of, or filing with, any court, federal or state regulatory body,
administrative agency or other governmental instrumentality is required in
connection with the 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 and those that the Seller, in its capacity as Servicer under
the Servicing Agreement, is required to make in the future pursuant to the
Servicing Agreement and post closing filings required under federal
securities law in connection therewith.
Section 3.08. The Transition Property.
(a) Title. It is the intention of the parties hereto that the
transfer and assignment herein contemplated constitute a sale of the
Transition Property from the Seller to the Note Issuer and that no interest
in, or title to, the Transition Property shall be part of the Seller's estate
in the event of the filing of a bankruptcy petition by or against the Seller
under any bankruptcy law. No portion of the Transition Property has been
sold, transferred, assigned or pledged by the Seller to any Person other than
the Note Issuer. On the Closing Date, immediately upon the sale hereunder,
the Seller has transferred, sold and conveyed the Transition Property to the
Note Issuer, free and clear of all Liens (except for any Liens created
pursuant to Section 1H(e) of Chapter 164 of the Massachusetts General Laws
and any Liens that may be granted under the Basic Documents), and pursuant to
Section 1H(f)(1) of Chapter 164 of the Massachusetts General Laws such
transfer shall be treated as an absolute transfer of all of the Seller's
right, title and interest (as in a true sale), and not as a pledge or other
financing of, the Transition Property.
(b) Transfer Filings. On the Closing Date, immediately upon the
sale hereunder, the Transition Property has been validly transferred and sold
to the Note Issuer, the Note Issuer shall own all such Transition Property
free and clear of all Liens (excluding any Lien created pursuant to Section
1H(e) of Chapter 164 of the Massachusetts General Laws and any Lien that may
be Granted under the Basic Documents) and all filings to be made by the
Seller (including filings with the DTE under the Statute) necessary in any
jurisdiction to Grant the Note Issuer a valid first priority perfected
ownership interest (subject to any Lien created pursuant to Section 1H(e) of
Chapter 164 of the Massachusetts General Laws and any Lien that may be
Granted under the Basic Documents) in, and to Grant the Note Trustee a valid
first priority perfected security interest (subject to any Lien created
pursuant to Section 1H(e) of Chapter 164 of the Massachusetts General Laws
and any Lien that may be granted under the Basic Documents) in, the
Transition Property have been made. No further action is required to
maintain the Note Issuer's first priority perfected ownership interest or the
Note Trustee's first priority perfected security interest (in each case,
subject to any Lien created pursuant to Section 1H(e) of Chapter 164 of the
Massachusetts General Laws and any Lien that may be Granted under the Basic
Documents). Filings have also been made to the extent required in any
jurisdiction to perfect the Back-Up Security Interest granted by the Seller
to the Note Issuer (subject to any Lien created pursuant to Section 1H(e) of
Chapter 164 of the Massachusetts General Laws and any Lien that may be
Granted under the Basic Documents).
(c) Financing Order and Issuance Advice Letter; Other Approvals.
On the Closing Date, under the laws of The Commonwealth of Massachusetts and
the United States in effect on the Closing Date, (i) the Financing Order
pursuant to which the Transition Property has been created is in full force
and effect; (ii) the Certificateholders are entitled to the protections of
the Statute and, accordingly, the Financing Order is not revocable by the
DTE; (iii) The Commonwealth of Massachusetts may not alter the provisions of
the Statute that make the RTC Charge irrevocable and binding, limit or alter
the Transition Charge, the Transition Property, or the Financing Order and
all rights thereunder, in a manner that would substantially impair the rights
of the Certificateholders, absent a demonstration by The Commonwealth of
Massachusetts that an impairment is narrowly-tailored and is necessary to
advance an important public interest, such as responding to a "great public
calamity" until the Certificates, together with interest thereon, are fully
met and discharged; (iv) except for periodic adjustments to the RTC Charge
required under the Statute, the DTE does not have authority, either by
rescinding, altering or amending the Financing Order or otherwise, to revalue
or revised for ratemaking purposes the Transition Costs, determine that the
reimbursable transition costs amounts or Transition Charges are unjust or
unreasonable or in any way to reduce or impair the value of Transition
Property either directly or indirectly by taking the reimbursable transition
costs amounts into account when setting other rates for the Seller; nor are
the amount of revenues arising with respect thereto subject to reduction,
impairment, postponement or termination; (v) the process by which the
Financing Order was adopted and approved, and the Financing Order and
Issuance Advice Letter themselves, comply with all applicable laws, rules and
regulations; (vi) the Issuance Advice Letter has been filed in accordance
with the Financing Order; (vii) 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 sale of the Transition
Property, except those that have been obtained or made and post closing
filings required in connection therewith and those that the Seller, in its
capacity as Servicer under the Servicing Agreement, is required to make in
the future pursuant to the Servicing Agreement; and (viii) The Commonwealth
of Massachusetts, in the exercise of its executive or legislative powers, may
not repeal or amend the Statute or the Financing Order, or take any action in
contravention of the pledge by The Commonwealth of Massachusetts in Section
1H(b)(3) of Chapter 164 of the Massachusetts General Laws, without paying
just compensation to the Certificateholders, as determined by a court of
competent jurisdiction, if this action would constitute a permanent
appropriation of a substantial property interest of Certificateholders in the
Transition Property and deprive the Certifcateholders of their reasonable
expectations arising from their investments in the Certificates.
(d) Assumptions. On the Closing Date, based upon the information
available to the Seller on the Closing Date, the assumptions used in
calculating the initial RTC Charge are reasonable and are made in good faith.
Notwithstanding the foregoing, the Seller makes no representation or warranty
that the assumptions used in calculating such RTC Charge will in fact be
realized.
(e) Creation of Transition Property. Upon the effectiveness of
the Financing Order and the Issuance Advice Letter: (i) all of the Transition
Property constitutes an existing property right; (ii) the Transition Property
includes the right, title and interest in and to all revenues, collections,
claims, payments, money, or proceeds of or arising from the RTC Charge, as
adjusted from time to time pursuant to the Financing Order, and all rights to
obtain adjustments to the RTC Charge pursuant to the Financing Order; and
(iii) subject to the cap on the Seller's Transition Charge set forth in the
Financing Order, the owner of the Transition Property is legally entitled to
collect payments in respect of the RTC Charge in the aggregate sufficient to
pay the interest on and principal of the Notes, to pay the fees and expenses
of servicing the Notes and the Certificates, to replenish the Capital
Subaccount to the Required Capital Level and to fund the
Overcollateralization Subaccount to the Required Overcollateralization Level
and to enforce all other material rights conferred in the Financing Order and
the Statute until the Notes and the Certificates are paid in full.
Notwithstanding the foregoing, the Seller makes no representation or warranty
that any amounts actually collected in respect of the RTC Charge will in fact
be sufficient to meet payment obligations with respect to the Notes and the
Certificates.
(f) Prospectus. As of the date hereof, the information describing
the Seller in "The Seller and Servicer" section of the prospectus dated May
14, 2001 offering the Notes and the Certificates is correct in all material
respects.
Section 3.09. Limitations on Representations and Warranties.
Notwithstanding any other provisions of this Agreement, the Seller will not
be in breach of any representation or warranty as a result of a change in law
by means of a legislative enactment, constitutional amendment or voter
initiative. Notwithstanding anything to the contrary in this Agreement, the
Seller makes no representation or warranty that any amounts actually
collected in respect of the RTC Charge will in fact be sufficient to meet
payment obligations with respect to the Notes and the Certificates or that
the assumptions used in calculating the RTC Charge will in fact be realized
nor shall the Seller be obligated to reduce, or accept a reduction of, any
rates or charges to which it would otherwise be entitled in respect of
services rendered or to be rendered to Customers in order to permit the
payment of the RTC Charge.
ARTICLE 4
COVENANTS OF THE SELLER
Section 4.01. Corporate Existence. So long as any of the Notes are
outstanding, the Seller (a) will keep in full force and effect its existence,
rights and franchises as a corporation under the laws of the jurisdiction of
its organization and (b) will obtain and preserve its qualification to do
business, in each case to the extent that in each such jurisdiction such
existence or qualification is or shall be necessary to protect the validity
and enforceability of this Agreement, the other Basic Documents to which the
Seller is a party and each other instrument or agreement necessary or
appropriate to the proper administration of this Agreement and the
transactions contemplated hereby.
Section 4.02. No Liens. Except for the conveyances hereunder, any Lien
under Section 1H(e) of Chapter 164 of the Massachusetts General Laws or the
Back-Up Security Interest, the Seller will not sell, pledge, assign or
transfer, or grant, create, or incur any Lien on, any of the Transition
Property, or any interest therein, and the Seller shall defend the right,
title and interest of the Note Issuer and the Note Trustee in, to and under
the Transition Property against all claims of third parties claiming through
or under the Seller. Western Massachusetts Electric Company, in its capacity
as Seller, will not at any time assert any Lien against, or with respect to,
any of the Transition Property.
Section 4.03. Delivery of Collections. If the Seller receives any
payments in respect of the RTC Charge or the proceeds thereof when it is not
acting as the Servicer, the Seller agrees to pay to the Servicer all payments
received by it in respect thereof as soon as practicable after receipt
thereof by it.
Section 4.04. Notice of Liens. The Seller shall notify the Note Issuer
and the Note Trustee promptly after becoming aware of any Lien on any of the
Transition Property, other than the conveyances hereunder, any Lien Granted
by the Issuer under the Basic Documents or any Lien under Section 1H(e) of
Chapter 164 of the Massachusetts General Laws or the Back-Up Security
Interest.
Section 4.05. Compliance with Law. The Seller hereby agrees to comply
with its organizational and governing documents and all laws, treaties,
rules, regulations and determinations of any governmental instrumentality
applicable to it, except to the extent that failure to so comply would not
adversely affect the Note Issuer's or the Note Trustee's interests in the
Transition Property or under any of the other Basic Documents to which the
Seller is party or the Seller's performance of its obligations hereunder or
under any of the other Basic Documents to which it is party.
Section 4.06. Covenants Related to Notes and Transition Property.
(a) So long as any of the Notes are outstanding, the Seller shall
treat the Notes as debt of the Note Issuer and not of the Seller, except for
financial accounting or tax reporting purposes.
(b) So long as any of the Notes are outstanding, the Seller shall
indicate in its financial statements that it is not the owner of the
Transition Property and that the assets of the Note Issuer are not available
to pay creditors of the Seller or any of its Affiliates (other than the Note
Issuer).
(c) So long as any of the Notes are outstanding, the Seller shall
disclose the effects of all transactions between the Seller and the Note
Issuer in accordance with generally accepted accounting principles.
(d) So long as any of the Notes or Certificates are outstanding,
the Seller shall not own or purchase any Notes or Certificates.
(e) The Seller agrees that, upon the sale by the Seller of the
Transition Property to the Note Issuer pursuant to this Agreement, (i) to the
fullest extent permitted by law, including the Statute and applicable DTE
Regulations, the Note Issuer shall have all of the rights originally held by
the Seller with respect to the Transition Property, including the right
(subject to the terms of the Servicing Agreement) to exercise any and all
rights and remedies to collect any amounts payable by any Customer or third
party supplier in respect of the Transition Property, notwithstanding any
objection or direction to the contrary by the Seller and (ii) any payment by
any Customer or third party supplier to the Note Issuer shall discharge such
Customer's or third party supplier's obligations in respect of the Transition
Property to the extent of such payment, notwithstanding any objection or
direction to the contrary by the Seller.
(f) So long as any of the Notes are outstanding, (i) (A) the
Seller shall affirmatively certify and confirm that it has sold the
Transition Property to the Note Issuer (other than for financial accounting
or tax reporting purposes), and (B) the Seller shall not make any statement
or reference in respect of the Transition Property that is inconsistent with
the ownership thereof by the Note Issuer (other than for financial accounting
or tax reporting purposes), and (ii) the Seller shall not take any action in
respect of the Transition Property except solely in its capacity as the
Servicer thereof pursuant to the Servicing Agreement or as otherwise
contemplated by the Basic Documents.
Section 4.07. Protection of Title. The Seller shall execute and file
such filings, including filings with the DTE pursuant to the Statute and UCC
filings, and cause to be executed and filed such filings, all in such manner
and in such places as may be required by law fully to preserve, maintain and
protect the ownership or security interest of the Note Issuer in and the Note
Trustee in the Transition Property and the Back Up Security Interest,
including all filings required under the Statute and the applicable UCC
relating to the transfer of the ownership or security interest in the
Transition Property by the Seller to the Note Issuer, the granting of a
security interest in the Transition Property by the Note Issuer to the Note
Trustee and the Back-Up Security Interest and the continued perfection of
such ownership or security interest. The Seller shall deliver (or cause to be
delivered) to the Note Trustee (with a copy of the Note Issuer) 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 performance by the DTE or The
Commonwealth of Massachusetts of any of their obligations or duties under the
Statute 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, as may be reasonably necessary (i) to protect the Note Issuer,
the Noteholders, the Certificateholders, the Note Trustee, the Delaware
Trustee, the Certificate Trustee, the Certificate Issuer, the Commonwealth of
Massachusetts, the Executive Office for Administration and Finance of The
Commonwealth of Massachusetts and the Agencies and any of their respective
affiliates, officials, officers, directors, employees, consultants, counsel
and agents 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 (ii) to block or overturn any
attempts to cause a repeal of, modification of or supplement to the Statute,
the Financing Order, any Advice Letter (as defined in the Note Indenture),
the Restructuring Order (as defined in the Financing Order) (to the extent it
adversely affects the rights of Noteholders or the validity or value of the
Transition Property) or the rights of Noteholders by executive action,
legislative enactment or constitutional amendment that would be adverse to
the Note Issuer, the Note Trustee or the Noteholders. If the Servicer
performs its obligations under Section 5.02(d) of the Servicing Agreement in
all respects, such performance shall be deemed to constitute performance of
the Seller's obligations pursuant to clause (ii) of the immediately preceding
sentence. In such event, the Seller agrees to assist the Servicer as
reasonably necessary to perform its obligations under Section 5.02(d) of the
Servicing Agreement in all respects. The costs of any such actions or
proceedings shall be payable from RTC Charge Collections as an Operating
Expense in accordance with the priorities set forth in Section 8.02(d) of the
Note Indenture. The Seller's obligations pursuant to this Section 4.07 shall
survive and continue notwithstanding the fact that the payment of Operating
Expenses pursuant to Section 8.02(d) of the Note Indenture may be delayed (it
being understood that the Seller may be required to advance its own funds to
satisfy its obligations hereunder).
Section 4.08. Nonpetition Covenants. Notwithstanding any prior
termination of this Agreement or the Note Indenture, but subject to the DTE's
right to order the sequestration and payment of revenues arising with respect
to the Transition Property notwithstanding any bankruptcy, reorganization or
other insolvency proceedings with respect to the Seller pursuant to Section
1H(d)(5) of Chapter 164 of the Massachusetts General Laws, the Seller shall
not, prior to the date which is one year and one day after the termination of
the Note Indenture, petition or otherwise invoke or cause the Note Issuer to
invoke the process of any court or government authority for the purpose of
commencing or sustaining a case against the Note Issuer under any Federal or
state bankruptcy, insolvency or similar law, appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of the Note Issuer or any substantial part of the property of the
Note Issuer, or ordering the winding up or liquidation of the affairs of the
Note Issuer.
Section 4.09. Taxes. So long as any of the Notes are outstanding, the
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 Transition Property; provided that no such tax need be paid if
the Seller or one of its subsidiaries is contesting the same in good faith by
appropriate proceedings promptly instituted and diligently conducted and if
the Seller or such subsidiary has established appropriate reserves as shall
be required in conformity with generally accepted accounting principles.
Section 4.10. Additional Sales of Transition Property. So long as any
of the Notes are outstanding, the Seller shall not sell any transition
property (as defined in the Statute) to secure another issuance of electric
rate reduction bonds (as defined in the Statute) if it would cause the then
existing ratings on any Class of Certificates from the Rating Agencies to be
withdrawn or downgraded and in that regard, the Seller shall not consummate
any such sale unless the Rating Agency Condition (as defined in the Note
Indenture) shall have been satisfied and Moody's shall have provided written
confirmation that such sale will not result in the withdrawal or downgrade of
Moody's then existing ratings on any Class of Certificates.
Section 4.11. Issuance Advice Letter. The Seller hereby agrees not to
withdraw the filing of the Issuance Advice Letter with the DTE.
Section 4.12. Maintenance of Working Papers. So long as any of the
Notes are outstanding, the Seller shall keep and maintain any and all working
papers, reports and other documents used by the firm of Independent certified
public accountants in the preparation of its letters delivered on the
Issuance Date pursuant to Section 2.10(g) of the Note Indenture and [Section
6(k)] of the Underwriting Agreement.
ARTICLE 5
THE SELLER
Section 5.01. Liability of 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) Error! Bookmark not defined. In the event of a breach by the
Seller of any representation and warranty specified in Sections 3.08(c) or
3.08(e) that has a material adverse effect on the Certificateholders, the
Seller shall repurchase the Transition Property from the Note Issuer at a
purchase price equal to the then outstanding principal amount of the Notes
and all accrued and unpaid interest thereon, excluding any premium or penalty
of any kind (the "Repurchase Price"), as of the Repurchase Date; provided,
however, that the Seller shall not be obligated to repurchase the Transition
Property if (A) within 90 days after the Date of Breach such breach is cured
or the Seller takes remedial action such that there is not and will not be a
material adverse effect on the Certificateholders as a result of such breach
and (B) either (1) if the Seller had, immediately prior to the Date of
Breach, a long term debt rating of at least "A3" by Moody's and "BBB" or the
equivalent by S&P or Fitch, and the Seller enters into a binding agreement
with the Note Issuer to pay any amounts necessary so that all interest
payments due on the Notes during such 90-day period will be paid in full, or
(2) if the Seller does not have such long term debt ratings, the Seller
deposits, within two Business Days after the Date of Breach, an amount in
escrow with the Note Trustee sufficient, taking into account amounts on
deposit in the Collection Account which will be available for such purpose,
to pay all interest payments which will become due on the Notes during such
90-day period.
(i) In the event of a breach by the Seller of any
representation and warranty specified in Sections 3.01, 3.03, 3.04, 3.05,
3.06, 3.08(a) or 3.08(b) that has a material adverse effect on the
Certificateholders, if within 90 days after the Date of Breach such breach
has not been cured or the Seller has not taken remedial action such that
there is not and will not be a material adverse effect on the
Certificateholders as a result of such breach, then the Seller shall
repurchase the Transition Property from the Note Issuer for the Repurchase
Price on the Repurchase Date.
(ii) Notwithstanding any other provision of this Agreement,
upon the payment by the Seller of the Repurchase Price pursuant to this
Section 5.01(b), neither the Note Issuer nor any other Person shall have any
other claims, rights or remedies against the Seller under, arising from or
with respect to this Agreement, except as set forth in Section 5.01(b),
5.01(c), 5.01(d) and 5.01(h).
(c) Subject to Section 5.01(i), the Seller shall indemnify the
Note Issuer, the Note Trustee, the Certificate Trustee, the Delaware Trustee,
the Commonwealth of Massachusetts, the Executive Office for Administration
and Finance of The Commonwealth of Massachusetts, the Agencies, the
Certificate Issuer, the Noteholders and the Certificateholders (each an
"Indemnified Person" for purposes of this Section 5.01(c) and Section
5.01(i)) for, and defend and hold harmless each such Indemnified Person from
and against, any and all taxes (other than taxes imposed on Noteholders or
Certificateholders solely as a result of their ownership of Notes or
Certificates, respectively) that may at any time be imposed on or asserted
against any such Person under existing law as of the Closing Date as a result
of the sale of the Transition Property to the Note Issuer, including any
sales, gross receipts, general corporation, tangible personal property,
privilege or license taxes; provided, however, that the Noteholders and the
Certificateholders shall be entitled to enforce their rights against the
Seller under this Section 5.01(c) solely through a cause of action brought
for their benefit by the Note Trustee or the Certificate Trustee, as the case
may be.
(d) Subject to Section 5.01(i), the Seller shall indemnify the
Note Issuer, the Note Trustee, the Certificate Trustee, the Delaware Trustee,
The Commonwealth of Massachusetts, the Executive Office for Administration
and Finance of The Commonwealth of Massachusetts, the Agencies, the
Certificate Issuer, the Noteholders and the Certificateholders (each an
"Indemnified Person" for purposes of this Section 5.01(d) and Section
5.01(i)) for, and defend and hold harmless each such Indemnified Person from
and against, any and all taxes that may be imposed on or asserted against any
such Indemnified Person under existing law as of the Closing Date as a result
of the issuance and sale by the Note Issuer of the Notes, the issuance and
sale by the Trust of the Certificates or the other transactions contemplated
herein, including any sales, gross receipts, general corporation, tangible
personal property, privilege or license taxes; provided, however, that the
Noteholders and the Certificateholders shall be entitled to enforce their
rights against the Seller under this Section 5.01(d) solely through a cause
of action brought for their benefit by the Note Trustee or the Certificate
Trustee, as the case may be. The Seller shall be reimbursed for any payments
under this Section 5.01(d) from RTC Charge Collections as an Operating
Expense in accordance with the priorities set forth in Section 8.02(d) of the
Note Indenture.
(e) Subject to Section 5.01(i), the Seller shall indemnify the
Note Issuer, the Noteholders and the Certificateholders (each an "Indemnified
Person" for purposes of this Section 5.01(e) and Section 5.01(i)) for, and
defend and hold harmless each such Person from and against, any and all
liabilities, obligations, losses, actions, suits, claims, damages, payments,
costs or expenses of any kind whatsoever (collectively, "Losses") that may be
imposed on, incurred by or asserted against each such Indemnified Person as a
result of (i) the Seller's willful misconduct or negligence in the
performance of its duties or observance of its covenants under this
Agreement, or (ii) the Seller's breach in any material respect of any of its
representations and warranties contained in this Agreement (other than the
representations and warranties specified in Sections 3.01, 3.03, 3.04, 3.05,
3.06, 3.08(a), 3.08(b), 3.08(c) or 3.08(e), the breach of which are subject
to the repurchase obligation set forth in Section 5.01(b)), except in the
case of both clauses (i) and (ii) to the extent of Losses either resulting
from the willful misconduct or gross negligence of such Indemnified Person or
resulting from a breach of a representation and warranty made by such
Indemnified Person in any of the Basic Documents that gives rise to the
Seller's breach; provided, however, that the Noteholders and the
Certificateholders shall be entitled to enforce their rights against the
Seller under this indemnification solely through a cause of action brought
for their benefit by the Note Trustee or the Certificate Trustee, as the case
may be; provided, further, that the Seller may, at its election and in full
satisfaction of its obligations under this Section 5.01(e), repurchase the
Transition Property at the Repurchase Price, in which case neither the Note
Issuer nor any other Person shall have any other claims, rights or remedies
against the Seller under, arising from or with respect to this Agreement,
except as set forth in Sections 5.01(b), 5.01(c), 5.01(d) and 5.01(h).
(f) Indemnification under Sections 5.01(c), 5.01(d), 5.01(e) and
5.01(h) shall include reasonable fees and out-of-pocket expenses of
investigation and litigation (including reasonable attorneys' fees and
expenses), except as otherwise provided in this Agreement.
(g) Without prejudice to any of the other rights of the parties,
the Seller will not be in breach of any representation or warranty as a
result of a change in law by means of a legislative enactment, constitutional
amendment or voter initiative. Notwithstanding anything to the contrary in
this Agreement, the Seller makes no representation or warranty that any
amounts actually collected in respect of the RTC Charge will in fact be
sufficient to meet payment obligations with respect to the Notes and the
Certificates or that the assumptions used in calculating the RTC Charge will
in fact be realized nor shall the Seller be obligated to reduce, or accept a
reduction of, any rates or charges to which it would otherwise be entitled in
respect of services rendered or to be rendered to customers in order to
permit the payment of the RTC Charge (other than deferrals for future
recovery).
(h) Subject to Section 5.01(i), the Seller shall indemnify and
hold harmless the Note Trustee, the Delaware Trustee, the Certificate
Trustee, the Certificate Issuer, The Commonwealth of Massachusetts, the
Executive Office for Administration and Finance of The Commonwealth of
Massachusetts, the Agencies and any of their respective affiliates,
officials, officers, directors, employees, consultants, counsel and agents
(each an "Indemnified Person" for purposes of this Section 5.01(h) and
Section 5.01(i)) against any and all Losses incurred by any of such
Indemnified Persons as a result of (i) the Seller's willful misconduct or
negligence in the performance of its duties or observance of its covenants
under this Agreement or (ii) the Seller's breach in any material respect of
any of its representations and warranties contained in this Agreement, except
in the case of both clauses (i) and (ii) to the extent of Losses either
resulting from the willful misconduct or gross negligence of such Indemnified
Person or resulting from a breach of a representation or warranty made by
such Indemnified Person in any of the Basic Documents that gives rise to the
Seller's breach. The indemnities contained in this Section 5.01(h) shall
survive the resignation or termination of the Note Trustee, the Certificate
Trustee or the Delaware Trustee or the termination of this Agreement.
(i) The Seller shall not be required to indemnify any Indemnified
Person under Sections 5.01(c), 5.01(d), 5.01(e) or 5.01(h) 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 Seller, which
consent shall not be unreasonably withheld. Promptly after receipt by an
Indemnified Person of notice of its involvement in any action, proceeding or
investigation, such Indemnified Person shall, if a claim for indemnification
in respect thereof is to be made against the Seller under this Section 5.01,
notify the Seller in writing of such involvement. Failure by an Indemnified
Person to so notify the Seller shall relieve the Seller from the obligation
to indemnify and hold harmless such Indemnified Person under this Section
5.01 only to the extent that the Seller 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 5.01, the Seller shall be entitled to assume the defense of any such
action, proceeding or investigation. Upon assumption by the Seller of the
defense of any such action, proceeding or investigation, the Indemnified
Person shall have the right to participate in such action or proceeding and
to retain its own counsel. The Seller shall be entitled to appoint counsel
of the Seller's choice at the Seller's expense to represent the Indemnified
Person in any action, proceeding or investigation for which a claim of
indemnification is made against the Seller under this Section 5.01 (in which
case the Seller 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 such counsel shall be reasonably
satisfactory to the Indemnified Person. Notwithstanding the Seller's
election to appoint counsel to represent the Indemnified Person in an action,
proceeding or investigation, the Indemnified Person shall have the right to
employ separate counsel (including local counsel), and the Seller shall bear
the reasonable fees, costs and expenses of such separate counsel if (i) the
use of counsel chosen by the Seller to represent the Indemnified Person would
present such counsel with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action include both the
Indemnified Person and the Seller 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 Seller, (iii) the
Seller 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 or (iv) the Seller shall
authorize the Indemnified Person to employ separate counsel at the expense of
the Seller. Notwithstanding the foregoing, the Seller shall not be obligated
to pay for the fees, costs and expenses of more than one separate counsel for
the Indemnified Persons (in addition to local counsel). The Seller will not,
without the prior written consent of the Indemnified Person, settle or
compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification may be sought under this Section 5.01 (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.
(j) The remedies of the Note Issuer, the Noteholders and the
Certificateholders provided in this Agreement are each such Person's sole and
exclusive remedies against the Seller for breach of its representations and
warranties in this Agreement.
Section 5.02. Merger or Consolidation of, or Assumption of the
Obligations of, Seller. Any Person (a) into which the Seller may be merged
or consolidated, (b) that may result from any merger or consolidation to
which the Seller shall be a party or (c) that may succeed to the properties
and assets of the Seller substantially as a whole, which Person in any case
described in the foregoing clause (c) executes an agreement of assumption to
perform every obligation of the Seller hereunder, shall be the successor to
the Seller under this Agreement without further act on the part of any of the
parties to this Agreement; provided, however, that (i) if the Seller is the
Servicer, 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, (ii) the Seller shall have delivered to the Note Issuer and the
Note Trustee an Officer's Certificate stating that such consolidation, merger
or succession and such agreement of assumption comply with this Section and
that all conditions precedent, if any, provided for in this Agreement
relating to such transaction have been complied with, (iii) the Seller shall
have delivered to the Note Issuer and the Note Trustee an Opinion of Counsel
stating that, in the opinion of such counsel (A) such consolidation, merger
or succession and such agreement of assumption comply with this Section and
that all conditions precedent provided for in this Agreement relating to such
transaction have been complied with and (B) either (1) all filings to be made
by the Seller, including filings with the DTE pursuant to the Statute and
under the applicable UCC, have been executed and filed that are necessary to
preserve and protect fully the interests of the Note Issuer and the Note
Trustee in the Transition Property and reciting the details of such filings,
or (2) no such action shall be necessary to preserve and protect such
interests and (iv) the Rating Agencies shall have received prior written
notice of such transaction. 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 and execution by
such successor of an agreement of assumption to perform every obligation of
the Seller hereunder, then upon satisfaction of all of the other conditions
of this Section 5.02, the Seller shall automatically and without further
notice be released from all of its obligations hereunder, except with respect
to any acts or omissions of the Seller that occurred prior to such
assumption.
Section 5.03. Limitation on Liability of 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.
ARTICLE 6
MISCELLANEOUS PROVISIONS
Section 6.01. Amendment. This Agreement may be amended by the Seller
and the Note Issuer, with ten Business Days' prior written notice given to
the Rating Agencies and the prior written consent of the Note Trustee, but
without the consent of any of the Noteholders, to cure any ambiguity, to
correct or supplement any provisions in this Agreement or for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions in this Agreement or of modifying in any manner the rights of the
Noteholders; provided, however, that such action shall not, as evidenced by
an Officer's Certificate delivered to the Note Issuer and the Note Trustee,
adversely affect in any material respect the interests of any Noteholder.
This Agreement may also be amended from time to time by the Seller and
the Note Issuer, with ten Business Days' prior written notice given to the
Rating Agencies and the prior written consent of the Note Trustee and the
prior written consent of the Holders of Notes evidencing not less than a
majority of the Outstanding Amount of the Notes affected thereby, for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the
rights of the Noteholders.
It shall not be necessary for the consent of Noteholders pursuant to
this Section to approve the particular form of any proposed amendment or
consent, but it shall be sufficient if such consent shall approve the
substance thereof.
Prior to the execution of any amendment to this Agreement, the Note
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 Note Trustee may, but shall not be obligated to, enter
into any such amendment which affects the Note Trustee's own rights, duties
or immunities under this Agreement or otherwise.
The Note Issuer shall provide a copy of any amendment to this Agreement
to the Rating Agencies and the Note Trustee promptly after the execution
thereof.
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 mail,
courier service, facsimile transmission or electronic mail (confirmed by
telephone, United States mail or 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 if mailed, three days after deposit in the
United States mail with proper postage for ordinary mail prepaid:
(a) if to the Seller, to
Western Massachusetts Electric Company
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxxxxxxxxx, XX 00000
Attention: Assistant Treasurer-Finance
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Email: xxxxxxxx@xx.xxx
With a copy to:
Western Massachusetts Electric Company
c/o Northeast Utilities Service Company
if by U.S. Mail:
X.X. Xxx 000
Xxxxxxxx, XX 00000-0000
if by courier:
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Assistant Treasurer-Finance
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Email: xxxxxxx@xx.xxx
(b) if to the Note Issuer, to
WMECO Funding LLC
x/x Xxxxxxx Xxxxxxxxxxxxx Electric Company
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxxxxxxxxx, XX 00000
Attention: Assistant Treasurer-Finance
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Email: xxxxxxx@xx.xxx
with a copy to:
Western Massachusetts Electric Company
c/o Northeast Utilities Service Company
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Assistant Treasurer-Finance
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Email: xxxxxxx@xx.xxx
(c) if to the Note Trustee, to
The Bank of New York, as trustee
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, XX 00000
Attention: ABS Unit
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(d) if to Moody's, to
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: ABS Monitoring Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(e) if to S&P, to
Standard & Poor's
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Asset Backed Surveillance Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(f) if to Fitch, to
Fitch, Inc.
Xxx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: ABS Surveillance
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Email: xxxx@xxxxxxxxxxxx.xxx
(g) if to the Agencies, to:
Massachusetts Development Finance Agency
00 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
and
Massachusetts Health and Educational Facilities Authority
00 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(h) if to the Certificate Issuer, to:
The Bank of New York (Delaware), as Delaware Trustee for
Massachusetts RRB Special Purpose Trust WMECO-1
000 Xxxxx Xxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Compliance
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, XX 00000
Attention: ABS Unit
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(with copies to the Agencies at the addresses listed herein)
(i) as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
Section 6.03. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 5.02, this Agreement may not
be assigned by the Seller.
Section 6.04. Limitations on Rights of Third Parties. The provisions
of this Agreement are solely for the benefit of the Seller, the Note Issuer,
the Noteholders, the Certificateholders, the Note Trustee, the Certificate
Trustee, the Delaware Trustee, The Commonwealth of Massachusetts, the
Executive Office for Administration and Finance of The Commonwealth of
Massachusetts, the Agencies, the Certificate Issuer and the other Persons
expressly referred to herein, and such Persons shall have the right to
enforce the relevant provisions of this Agreement, except that the
Noteholders and the Certificateholders shall be entitled to enforce their
rights against the Seller under this Agreement solely through a cause of
action brought for their benefit by the Note Trustee or the Certificate
Trustee, as the case may be. 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 Transition Property or under or in
respect of this Agreement or any covenants, conditions or provisions
contained herein.
Section 6.05. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
Section 6.06. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
Section 6.07. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 6.08. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of The Commonwealth of Massachusetts,
without reference to its conflict of law provisions, and the obligations,
rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
Section 6.09. Assignment to Note Trustee. The Seller hereby
acknowledges and consents to any Grant of a Lien by the Note Issuer to the
Note Trustee pursuant to the Note Indenture for the benefit of the
Noteholders and the Note Trustee of all right, title and interest of the Note
Issuer in, to and under the Transition Property and the proceeds thereof and
the assignment of any or all of the Note Issuer's rights and obligations
hereunder to the Note Trustee.
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IN WITNESS WHEREOF, the parties hereto have caused this Transition
Property Purchase and Sale Agreement to be duly executed under seal by their
respective officers as of the day and year first above written.
WMECO FUNDING LLC,
Note Issuer
By: /s/Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: President
WESTERN MASSACHUSETTS ELECTRIC COMPANY,
Seller
By: /s/Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Assistant Treasurer - Finance