ACCOUNT AGREEMENT
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This ACCOUNT AGREEMENT (this "Account Agreement"), dated as of August 21, 2003,
is among ONCOR ELECTRIC DELIVERY TRANSITION BOND COMPANY LLC, a Delaware limited
liability company, as Issuer (the "Issuer") and THE BANK OF NEW YORK, a New York
banking corporation, as Indenture Trustee (the "Indenture Trustee") and as
account bank (the "Account Bank). Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in Appendix A to that
certain Indenture, dated as of August 21, 2003 (as amended or supplemented, the
"Indenture"), by and between the Issuer and the Indenture Trustee.
W I T N E S S E T H:
WHEREAS, the Issuer is issuing contemporaneously herewith $500,000,000 aggregate
principal amount of its series 2003 transition bonds (the "2003 Bonds") and may
issue one or more additional series of transition bonds in 2004 or later, each
pursuant to the Indenture (together with the 2003 Bonds, the "Bonds");
WHEREAS, the Indenture provides that there be established a special account as
defined below in which the Issuer shall deposit funds to cover the fees and
expenses including indemnity amounts of the Indenture Trustee;
WHEREAS, the Financing Order provides that in addition to the accounts specified
therein there may be established additional accounts and subaccounts by the
Issuer to be used for specified purposes;
WHEREAS, the Financing Order further provides that the Issuer may have assets
other than the Transition Property for the purpose of supporting its obligations
under the Bonds;
WHEREAS, the Financing Order affords the Issuer flexibility in establishing
terms and conditions of the Bonds and among other things in establishing
reserves.
NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
1. On or prior to August 21, 2003 (the "Closing Date"), the Account Bank
shall establish a segregated trust account (the "Indenture Trustee Reserve
Account") in the name of the Issuer for the benefit of the Indenture Trustee. In
no event shall the Indenture Trustee Reserve Account be deemed part of the trust
estate or constitute Collateral. Withdrawals from the Indenture Trustee Reserve
Account shall be made only as provided herein.
2. On the Closing Date, the Issuer shall deposit into the Indenture Trustee
Reserve Account, by wire transfer of immediately available funds, an amount
equal to $3,846,154. On the earlier of January 15, 2004 or the next issuance of
any Bonds in excess of the 2003 Bonds, the Issuer shall deposit into the
Indenture Trustee Reserve Account, by wire transfer of immediately available
funds, an amount equal to $6,153,846.
3. The funds to be credited to the Indenture Trustee Reserve Account shall
be invested and reinvested from time to time by the Account Bank upon receipt of
a written instruction from the Issuer or its agent or agents (from time to time
designated in writing) in Eligible Investments. The initial investment
instructions are hereto attached as Exhibit A. Upon receipt of instructions of
the Issuer, all net earnings on the amounts on deposit in the Indenture Trustee
Reserve Account shall be paid to the Issuer by the 5th Business Day of each
month, commencing on September, 2003. In no event shall the Account Bank or the
Indenture Trustee be liable for the selection of investments or for investment
losses incurred thereon. The Account Bank and the Indenture Trustee shall have
no liability in respect of losses incurred as a result of the failure of the
Issuer to provide timely written investment direction.
4. The Account Bank shall withdraw funds held in the Indenture Trustee
Reserve Account from time to time upon the request of the Indenture Trustee
without further consent by the Issuer or any other entity in order to reimburse
the Indenture Trustee for any fees and expenses reasonably incurred by the
Indenture Trustee (including reasonable attorney's fees and expenses) in
connection with the transactions contemplated in the Indenture, to the extent
that such amounts were not reimbursed or are not otherwise available under
section 8.02(e) of the Indenture, and were not incurred by the Indenture Trustee
through Indenture Trustee's own willful misconduct, negligence or bad faith
(collectively, the "Fees and Expenses"). The Indenture Trustee shall present a
statement of Fees and Expenses to the Issuer at least one day prior to such
withdrawal.
5. If an Event of Default under the Indenture has occurred and is
continuing (i) the Indenture Trustee shall have sole control of the Indenture
Trustee Reserve Account, (ii) the Account Bank shall recognize only written
instructions of the Indenture Trustee, and (iii) the Issuer shall have no
control over the Indenture Trustee Reserve Account, except as provided in
paragraph 6 below.
6. On the date upon which all amounts due to the Holders have been paid in
full in accordance with the terms of the Indenture, all funds remaining in the
Indenture Trustee Reserve Account less any amounts then due and owing to the
Indenture Trustee hereunder shall be distributed to the Issuer upon its written
order.
7. This Account Agreement shall not serve as a waiver or modification to
any right or remedy available to the Indenture Trustee under the terms of the
Basic Documents.
8. THIS ACCOUNT AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER
THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
9. Any notice, report or other communication given hereunder (including
each statement of Fees and Expenses) shall be in writing and addressed as
follows:
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if to the Issuer, to:
Oncor Electric Delivery Transition Bond Company LLC
Energy Plaza
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇-▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Manager
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Oncor Electric Delivery Company, as Administrator
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, Assistant Treasurer
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
if to the Indenture Trustee, to:
The Bank of New York
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▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Structured Finance - ABS
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address as any party shall have provided to the other
parties in writing. Any notice required to be in writing hereunder shall be
deemed given if such notice is mailed by certified mail, postage prepaid, by
facsimile, or hand-delivered to the address of such party as provided above.
10. No amendment or waiver of any provision of this Account Agreement, nor
any consent to any deviation by Issuer, shall in any event be effective unless
the same shall be in writing and signed by the Indenture Trustee (and, in the
case of an amendment, the other parties hereto), and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given and only in respect of the provisions of this Account Agreement
specifically waived.
11. This Account Agreement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. Delivery of an executed counterpart of a signature page of this
Account Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Account Agreement.
12. This Account Agreement is the entire agreement of the parties with
respect to the subject matter hereof, and supersedes any and all previous
agreements and understandings with respect to the subject matter thereof.
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13. In the event any one or more of the provisions contained in this
Account Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision hereof, but each shall be construed as if
such invalid, illegal or unenforceable provision had never been included
hereunder.
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IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Account Agreement as of the day and year first above written.
ONCOR ELECTRIC DELIVERY
TRANSITION BOND COMPANY LLC,
as Issuer
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇, Manager
ACKNOWLEDGED AND AGREED
THE BANK OF NEW YORK,
as Account Bank
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
THE BANK OF NEW YORK,
as Indenture Trustee
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
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EXHIBIT A
AUTHORIZATION AND DIRECTION TO THE BANK OF NEW YORK
TO INVEST CASH BALANCES
[INTENTIONALLY OMITTED]