EXECUTION COPY
MASSACHUSETTS RRB SPECIAL PURPOSE TRUST WMECO-1
RATE REDUCTION CERTIFICATES
WMECO FUNDING LLC
WESTERN MASSACHUSETTS ELECTRIC COMPANY
UNDERWRITING AGREEMENT
New York, New York
May 14, 2001
To the Representatives named in Schedule I
hereto of the Underwriters named in
Schedule II hereto
Ladies and Gentlemen:
1. Introduction. Massachusetts RRB Special Purpose Trust WMECO-
1, a Delaware business trust to be formed (the "Trust"), will sell to the
underwriters named in Schedule II hereto (the "Underwriters"), for whom you
(the "Representatives") are acting as representatives, the principal amount
of Massachusetts RRB Special Purpose Trust WMECO-1 Rate Reduction
Certificates identified in Schedule I hereto (the "Certificates"). If the
firm or firms listed in Schedule I hereto include only the firm or firms
listed in Schedule II hereto, then the terms "Underwriters" and
"Representatives," as used herein, shall each be deemed to refer to such firm
or firms.
The Trust will be formed pursuant to a Declaration of Trust to be dated
prior to the Closing Date (as hereinafter defined) (the "Declaration of
Trust"), by The Bank of New York (Delaware), as Delaware Trustee (the
"Delaware Trustee"), and the Massachusetts Development Finance Agency and the
Massachusetts Health and Educational Facilities Authority (each an "Agency,"
and, collectively, the "Agencies"), acting jointly as settlors thereunder
pursuant to Chapter 164 of the Massachusetts Acts of 1997 (the "Statute").
The Certificates will be issued pursuant to a Certificate Indenture dated on
or about May 17, 2001 (the "Certificate Indenture"), between the Trust, the
Delaware Trustee and The Bank of New York, as Certificate Trustee (the
"Certificate Trustee"). The assets of the Trust will consist solely of the
WMECO Funding LLC Notes (the "Notes"), issued by WMECO Funding LLC, a
Delaware limited liability company (the "Note Issuer"), and the payments
received with respect thereto. The Notes will be issued pursuant to a Note
Indenture dated on or about May 17, 2001 (the "Note Indenture"), between the
Note Issuer and The Bank of New York, as Note Trustee (the "Note Trustee"),
and purchased by the Trust pursuant to a Note Purchase Agreement dated on or
about May 17, 2001 (the "Note Purchase Agreement"), between the Note Issuer
and the Trust. The Certificates will represent fractional undivided
beneficial interests in the underlying Notes and the proceeds thereof. The
Notes will be secured primarily by, and will be payable from, the Transition
Property described in the Issuance Advice Letter. Such Transition Property
will be sold to the Note Issuer by Western Massachusetts Electric Company, a
Massachusetts corporation (the "Company"), pursuant to a Transition Property
Purchase and Sale Agreement dated on or about May 17, 2001 (the "Sale
Agreement"), between the Company, as Seller, and the Note Issuer. The
Transition Property will be serviced pursuant to a Transition Property
Servicing Agreement dated on or about May 17, 2001 (as amended and
supplemented from time to time, the "Servicing Agreement"), between the
Company, as Servicer, and the Note Issuer.
Capitalized terms used and not otherwise defined herein shall have the
respective meanings given to them in the Note Indenture.
2. Representations and Warranties.
(a) Each of the Company and the Note Issuer represents and
warrants to, and agrees with, each Underwriter as set forth below in
this Section 2(a). Certain terms used in this Underwriting Agreement
are defined in paragraph (iii) below.
(i) If the offering of the Certificates is a Delayed
Offering (as specified in Schedule I hereto), paragraph (A) below
is applicable and, if the offering of the Certificates is a Non-
Delayed Offering (as so specified), paragraph (B) below is
applicable.
(A) The Note Issuer, the Notes and the Certificates
meet the requirements for the use of Form S-3 and Rule
415 under the Securities Act of 1933, as amended (the
"Act"), and the Note Issuer has filed with the Securities
and Exchange Commission (the "SEC") a registration
statement (file number 333-59118) on such Form, including
a basic prospectus, for registration under the Act of the
offering and sale of the Certificates. The Note Issuer
may have filed one or more amendments thereto, and may
have used a Preliminary Final Prospectus, each of which
has previously been furnished to you. Such registration
statement, as so amended, and in the form heretofore
delivered to you, has become effective. The offering of
the Certificates is a Delayed Offering and, although the
Basic Prospectus may not include all the information with
respect to the Certificates and the offering thereof
required by the Act and the rules thereunder to be
included in the Final Prospectus, the Basic Prospectus
includes all such information required by the Act and the
rules thereunder to be included therein as of the
Effective Date. The Note Issuer will next file with the
SEC pursuant to Rules 415 and 424(b)(2) or (5) a final
supplement to the form of prospectus included in such
registration statement relating to the Certificates and
the offering thereof. As filed, such final prospectus
supplement shall include all required information with
respect to the Certificates and the offering thereof and,
except to the extent the Representatives shall agree in
writing to a modification, shall be in all substantive
respects in the form furnished to you prior to the
Execution Time or, to the extent not completed at the
Execution Time, shall contain only such specific
additional information and other changes (beyond that
contained in the Basic Prospectus and any Preliminary
Final Prospectus) as the Note Issuer has advised you,
prior to the Execution Time, will be included or made
therein.
(B) The Note Issuer, the Notes and the Certificates
meet the requirements for the use of Form S-3 and Rule
415 under the Act and the Note Issuer has filed with the
SEC a registration statement (file number 333-59118) on
such Form, including a basic prospectus, for registration
under the Act of the offering and sale of the
Certificates. The Note Issuer may have filed one or more
amendments thereto, including a Preliminary Final
Prospectus in accordance with Rule 424(a), each of which
has previously been furnished to you. The Note Issuer
will next file with the SEC either (x) a final prospectus
supplement relating to the Certificates in accordance
with Rules 430A and 424(b)(1) or (4), or (y) prior to the
effectiveness of such registration statement, an
amendment to such registration statement, including the
form of final prospectus supplement. In the case of
clause (x), the Note Issuer has included in such
registration statement, as amended at the Effective Date,
all information (other than Rule 430A Information)
required by the Act and the rules thereunder to be
included in the Final Prospectus with respect to the
Certificates and the offering thereof. As filed, such
final prospectus supplement or such amendment and form of
final prospectus supplement shall contain all Rule 430A
Information, together with all other such required
information, with respect to the Certificates and the
offering thereof and, except to the extent the
Representatives shall agree in writing to a modification,
shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the
extent not completed at the Execution Time, shall contain
only such specific additional information and other
changes (beyond that contained in the Basic Prospectus
and any Preliminary Final Prospectus) as the Note Issuer
has advised you, prior to the Execution Time, will be
included or made therein.
(ii) On the Effective Date, the Registration Statement
did or will, and when the Final Prospectus is first filed (if
required) in accordance with Rule 424(b) and on the Closing Date,
the Final Prospectus (and any supplement thereto) will, comply in
all material respects with the applicable requirements of the Act,
the Securities Exchange Act of 1934, as amended (the "Exchange
Act") and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the respective rules thereunder; on the
Effective Date, the Registration Statement did not or will not
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; on the
Effective Date and on the Closing Date the Note Indenture and the
Certificate Indenture did or will comply in all material respects
with the requirements of the Trust Indenture Act and the rules and
regulations thereunder; and, on the Effective Date, the Final
Prospectus, if not filed pursuant to Rule 424(b), did not or will
not, and on the date of any filing pursuant to Rule 424(b) and on
the Closing Date, the Final Prospectus (together with any
supplement thereto) will not, include any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that
neither the Note Issuer nor the Company makes any representations
or warranties as to (A) that part of the Registration Statement
which shall constitute the Statements of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of the Note
Trustee and the Certificate Trustee or (B) the information
contained in or omitted from the Registration Statement or the
Final Prospectus (or any supplement thereto) under the heading
"Underwriting" in reliance upon and in conformity with information
furnished in writing to the Note Issuer by or on behalf of any
Underwriter through the Representatives specifically for inclusion
in the Registration Statement or the Final Prospectus (or any
supplement thereto), as specified in Section 8(b) of this
Agreement. No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted.
(iii) The terms which follow, when used in this
Agreement, shall have the meanings indicated. The term "Effective
Date" shall mean each date that the Registration Statement and any
post-effective amendment or amendments thereto became or become
effective and each date after the date hereof on which a document
incorporated by reference in the Registration Statement is filed.
"Execution Time" shall mean the date and time that this Agreement
is executed and delivered by the parties hereto. "Basic
Prospectus" shall mean the prospectus referred to in paragraph
(a)(i) above contained in the Registration Statement at the
Effective Date including, in the case of a Non-Delayed Offering,
any Preliminary Final Prospectus. "Preliminary Final Prospectus"
shall mean any preliminary prospectus supplement to the Basic
Prospectus which describes the Certificates and the offering
thereof and is used prior to filing of the Final Prospectus.
"Final Prospectus" shall mean the prospectus supplement relating to
the Certificates that is first filed pursuant to Rule 424(b) after
the Execution Time, together with the Basic Prospectus or, if, in
the case of a Non-Delayed Offering, no filing pursuant to
Rule 424(b) is required, shall mean the form of final prospectus
relating to the Certificates, including the Basic Prospectus,
included in the Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph (a)(i) above, including all incorporated
documents, exhibits and financial statements, as amended at the
Execution Time (or, if not effective at the Execution Time, in the
form in which it shall become effective) and, in the event any post-
effective amendment thereto becomes effective prior to the Closing
Date (as hereinafter defined), shall also mean such registration
statement as so amended. Such term shall include any Rule 430A
Information deemed to be included therein at the Effective Date as
provided by Rule 430A. "Rule 415," "Rule 424," "Rule 430A" and
"Regulation S-K" refer to such rules or regulation under the Act.
"Rule 430A Information" means information with respect to the
Certificates and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to
Rule 430A. Any reference herein to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective
Date of the Registration Statement or the issue date of the Basic
Prospectus, any Preliminary Final Prospectus or the Final Pros
pectus, as the case may be; and any reference herein to the terms
"amend," "amendment" or "supplement" with respect to the
Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and
include the filing of any document under the Exchange Act after the
Effective Date of the Registration Statement or the issue date of
the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus, as the case may be, deemed to be incorporated therein
by reference. A "Non-Delayed Offering" shall mean an offering of
Certificates which is intended to commence promptly after the
effective date of a registration statement, with the result that,
pursuant to Rules 415 and 430A, all information (other than
Rule 430A Information) with respect to the Certificates so offered
must be included in such registration statement at the effective
date thereof. A "Delayed Offering" shall mean an offering of
Certificates pursuant to Rule 415 which does not commence promptly
after the effective date of a registration statement, with the
result that only information required pursuant to Rule 415 need be
included in such registration statement at the effective date
thereof with respect to the Certificates so offered. Whether the
offering of the Certificates is a Non-Delayed Offering or a Delayed
Offering shall be set forth in Schedule I hereto.
3. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Trust
will sell to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Trust, at the purchase price for each class of
Certificates set forth in Schedule II hereto, the respective principal amount
of each class of Certificates set forth opposite the name of each Underwriter
on Schedule II hereto. Simultaneously with the execution and delivery of
this Agreement, and as a condition precedent to the effectiveness of this
Agreement, the Agencies will deliver to the Company, the Note Issuer and the
Representatives an executed copy of the certificate attached hereto as
Appendix A.
4. Delivery and Payment. Delivery of and payment for the
Certificates shall be made at 9:00 AM Eastern Time on May 17, 2001 (or such
later date not later than five business days after such specified date as the
Representatives shall designate), which date and time may be postponed by
agreement between the Representatives and the Note Issuer or as provided in
Section 9 hereof (such date and time of delivery and payment for the
Certificates being herein called the "Closing Date"). Delivery of the
Certificates shall be made to the Representatives for the respective accounts
of the several Underwriters against payment by the several Underwriters
through the Representatives of the purchase price thereof to the Trust by
wire transfer of immediately available funds in U.S. dollars. Delivery of
the Certificates shall be made at such location as the Representatives shall
reasonably designate at least one business day in advance of the Closing
Date. The Certificates to be so delivered shall be initially represented by
Certificates registered in the name of Cede & Co., as nominee of The
Depository Trust Company ("DTC"). The interests of beneficial owners of the
Certificates will be represented by book entries on the records of DTC and
participating members thereof. Definitive Certificates will be available
only under limited circumstances described in the Final Prospectus.
The Trust will have the Certificates available for inspection,
checking and packaging by the Representatives in New York, New York, not
later than 1:00 PM (Eastern Time) on the business day prior to the Closing
Date.
5. Covenants.
(a) Covenants of the Note Issuer. The Note Issuer covenants
and agrees with the several Underwriters that:
(i) The Note Issuer will use its best efforts to cause
the Registration Statement, if not effective at the Execution Time,
and any amendment thereto, to become effective. Prior to the
termination of the offering of the Certificates, the Note Issuer
will not file any amendment of the Registration Statement or
supplement (including the Final Prospectus or any Preliminary Final
Prospectus) to the Basic Prospectus unless the Note Issuer has
furnished you a copy for your review prior to filing and will not
file any such proposed amendment or supplement to which you
reasonably object. Subject to the foregoing sentence, the Note
Issuer will cause the Final Prospectus, properly completed in a
form approved by you, and any supplement thereto to be filed with
the SEC pursuant to the applicable paragraph of Rule 424(b) within
the time period prescribed and will provide evidence satisfactory
to the Representatives of such timely filing. The Note Issuer will
promptly advise the Representatives (A) when the Registration
Statement, if not effective at the Execution Time, and any
amendment thereto, shall have become effective, (B) when the Final
Prospectus, and any supplement thereto, shall have been filed with
the SEC pursuant to Rule 424(b), (C) when, prior to termination of
the offering of the Certificates, any amendment to the Registration
Statement shall have been filed or become effective, (D) of any
request by the SEC for any amendment of the Registration Statement
or supplement to the Final Prospectus or for any additional
information, (E) of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and
(F) of the receipt by the Note Issuer of any notification with
respect to the suspension of the qualification of the Certificates
for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose. The Note Issuer will use its best
efforts to prevent the issuance of any such stop order and, if
issued, to obtain as soon as possible the withdrawal thereof.
(ii) If, at any time when a prospectus relating to the
Certificates is required to be delivered under the Act, any event
occurs as a result of which the Final Prospectus as then
supplemented would include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were
made not misleading, or if it shall be necessary to amend the
Registration Statement or supplement the Final Prospectus to comply
with the Act or the Exchange Act or the respective rules
thereunder, the Note Issuer promptly will (A) prepare and file with
the SEC, subject to the second sentence of paragraph (a)(i) of this
Section 5, an amendment or supplement which will correct such
statement or omission or effect such compliance and (B) supply any
supplemented Prospectus to you in such quantities as you may
reasonably request.
(iii) As soon as practicable, the Note Issuer will
use its reasonable efforts to cause the Trust to make generally
available to the Certificateholders and the Representatives an
earnings statement or statements of the Trust which will satisfy
the provisions of Section 11(a) of the Act and Rule 158 under the
Act.
(iv) The Note Issuer will furnish to the Representatives
and counsel for the Underwriters, without charge, copies of the
Registration Statement (including exhibits thereto) and, so long as
delivery of a prospectus by an Underwriter or dealer may be
required by the Act, as many copies of any Preliminary Final
Prospectus and the Final Prospectus and any supplement thereto as
the Representatives may reasonably request. The Note Issuer shall
furnish or cause to be furnished to the Representatives copies of
all reports required by Rule 463 under the Act. The Note Issuer
will pay the expenses of printing or other production of all
documents relating to the offering.
(v) The Note Issuer will arrange for the qualification
of the Certificates for sale under the laws of such jurisdictions
as the Representatives may designate, will maintain such
qualifications in effect so long as required for the distribution
of the Certificates or requested by the Representatives and will
arrange for the determination of the legality of the Certificates
for purchase by institutional investors; provided, however, that in
no event shall the Note Issuer be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to
take any action that would subject it to service of process in
suits, other than those arising out of the offering or sale of the
Certificates, in any jurisdiction where it is not now so subject.
(vi) Until 90 days after the date hereof, the Note Issuer
will not, without the written consent of the Representatives,
offer, sell or contract to sell, or otherwise dispose of, directly
or indirectly, or announce the offering of, any asset-backed
securities of a trust or other special purpose vehicle (other than
the Notes and the Certificates).
(vii) For a period from the date of this Agreement
until the retirement of the Certificates or until such time as the
Underwriters shall cease to maintain a secondary market in the
Certificates, whichever occurs first, the Note Issuer will deliver
to the Representatives the annual statements of compliance and the
annual independent auditor's servicing reports furnished to the
Note Issuer or the Note Trustee pursuant to the Servicing Agreement
or the Note Indenture, as applicable, as soon as such statements
and reports are furnished to the Note Issuer or the Note Trustee.
(viii) So long as any of the Certificates are
outstanding, the Note Issuer will furnish to the Representatives
(A) as soon as available, a copy of each report of the Note Issuer
or the Trust filed with the SEC under the Exchange Act, or mailed
to Certificateholders, (B) a copy of any filings with the
Massachusetts Department of Telecommunications and Energy ("DTE")
pursuant to the Financing Order, including, but not limited to, any
Advice Letters, and (iii) from time to time, any information
concerning the Company, the Note Issuer or the Trust, as the
Representatives may reasonably request.
(ix) To the extent, if any, that any rating necessary to
satisfy the condition set forth in Section 6(r) of this Agreement
is conditioned upon the furnishing of documents or the taking of
other actions by the Note Issuer on or after the Closing Date, the
Note Issuer shall furnish such documents and take such other
actions.
(b) Covenants of the Company. The Company covenants and
agrees with the several Underwriters that, to the extent that the Note
Issuer has not already performed such act pursuant to Section 5(a):
(i) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and
any amendment thereto, to become effective. The Company will use
its best efforts to prevent the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement
and, if issued, to obtain as soon as possible the withdrawal
thereof.
(ii) The Company will cause the proceeds from the sale of
the Transition Property to be applied for the purposes permitted by
the Finance Order and described in the Prospectus including under
the caption "Use of Proceeds."
(iii) Until 90 days after the date hereof, the
Company will not, without the written consent of the
Representatives, offer, sell or contract to sell, or otherwise
dispose of, directly or indirectly, or announce the offering of,
any asset-backed securities of a trust or other special purpose
vehicle (other than the Notes and the Certificates).
(iv) So long as any of the Certificates are outstanding
and the Company is the Servicer, the Company will furnish to the
Representatives (A) as soon as available, a copy of each report of
the Trust filed with the SEC under the Exchange Act, or mailed to
Certificateholders, (B) a copy of any filings with the DTE pursuant
to the Financing Order, including, but not limited to, any Advice
Letters, and (C) from time to time, any information concerning the
Company, the Note Issuer or the Trust, as the Representatives may
reasonably request.
(v) To the extent, if any, that any rating necessary to
satisfy the condition set forth in Section 6(r) of this Agreement
is conditioned upon the furnishing of documents or the taking of
other actions by the Company on or after the Closing Date, the
Company shall furnish such documents and take such other actions.
(vi) If, at any time when a prospectus relating to the
Certificates is required to be delivered under the Act, any event
occurs as a result of which the Final Prospectus as then
supplemented would include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were
made not misleading, or if it shall be necessary to amend the
Registration Statement or supplement the Final Prospectus to comply
with the Act or the Exchange Act or the respective rules
thereunder, the Company at the Note Issuer's expense promptly will
(A) prepare and file with the SEC, subject to the second sentence
of paragraph (a)(i) of this Section 5, an amendment or supplement
which will correct such statement or omission or effect such
compliance and (B) supply any supplemented Prospectus to you in
such quantities as you may reasonably request.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Certificates shall be subject
to the accuracy of the representations and warranties on the part of the Note
Issuer and the Company contained herein as of the Execution Time and the
Closing Date and on the part of the Company contained in Article III of the
Sale Agreement and in Section 6.01 of the Servicing Agreement as of the
Closing Date, to the accuracy of the statements of the Note Issuer, the
Company and the Trust made in any certificates pursuant to the provisions
hereof, to the performance by the Note Issuer, the Company and the Trust of
their obligations hereunder to be performed on or prior to the Closing Date
and to the following additional conditions:
(a) If the Registration Statement has not become effective
prior to the Execution Time, unless the Representatives agree in writing
to a later time, the Registration Statement will become effective not
later than (i) 6:00 PM Eastern Time, on the date of determination of the
public offering price, if such determination occurred at or prior to
3:00 PM Eastern Time on such date, or (ii) 12:00 Noon Eastern Time on
the business day following the day on which the public offering price
was determined, if such determination occurred after 3:00 PM Eastern
Time on such date; if filing of the Final Prospectus, or any supplement
thereto, is required pursuant to Rule 424(b), the Final Prospectus, and
any such supplement, shall have been filed in the manner and within the
time period required by Rule 424(b); and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted or
threatened.
(b) The Representatives shall have received opinions of
counsel for the Company, portions of which may be delivered by Day,
▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, outside counsel for the Company, and portions of
which may be delivered by in-house counsel for the Company, as the
Representatives may agree, each dated the Closing Date, in form and
substance reasonably satisfactory to the Representatives, to the effect
that:
(i) the Company is a validly existing corporation in
good standing under the laws of the jurisdiction in which it is
chartered or organized and has all requisite corporate power and
authority to own its properties, conduct its business as presently
conducted and as described in the Registration Statement and the
Prospectus, and to execute, deliver and perform its obligations
under this Agreement, the Sale Agreement, the Servicing Agreement
and the Administration Agreement;
(ii) the Sale Agreement, the Servicing Agreement and the
Administration Agreement have been duly authorized, executed and
delivered by, and constitute legal, valid and binding instruments
enforceable against the Company in accordance with their terms
(subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws or equitable
principles affecting creditors' rights generally from time to time
in effect);
(iii) to the knowledge of such counsel, after having
made inquiry of officers of the Company, there is no pending or
threatened action, suit or proceeding before any court or
governmental agency, authority or body or any arbitrator involving
the Company or any of its affiliates, or challenging the Financing
Order or the collection of the RTC Charge or the use and enjoyment
of Transition Property under the Statute of a character required to
be disclosed in the Registration Statement which is not adequately
disclosed in the Final Prospectus, and there is no franchise,
contract or other document of a character required to be described
in the Registration Statement or the Final Prospectus, or to be
filed as an exhibit to the Registration Statement, which is not
described or filed as required;
(iv) this Agreement has been duly authorized, executed
and delivered by the Company;
(v) no consent, approval, authorization or order of any
Massachusetts or federal court or governmental agency or body is
required to be obtained by the Company for the consummation of the
transactions contemplated herein, except such as have been obtained
under the Statute, the DTE Regulations (as defined in Section 1.01
of the Servicing Agreement), the Public Utility Holding Company Act
of 1935, as amended (the "1935 Act") and the Act and such as may be
required under the blue sky laws of any jurisdiction in connection
with the purchase and distribution of the Certificates by the
Underwriters and such other approvals (specified in such opinion)
as have been obtained;
(vi) neither the execution and delivery of this
Agreement, the Sale Agreement, the Servicing Agreement, the
Administration Agreement nor the consummation of the transactions
contemplated by this Agreement, the Sale Agreement, the Servicing
Agreement or the Administration Agreement nor the fulfillment of
the terms of this Agreement, the Sale Agreement, the Servicing
Agreement or the Administration Agreement by the Company, will
(A) conflict with, result in any breach of any of the terms or
provisions of, or constitute (with or without notice or lapse of
time) a default under the articles of incorporation, bylaws or
other organizational documents of the Company, or conflict with or
breach any of the material terms or provisions of, or constitute
(with or without notice or lapse of time) a default under, any
indenture, material agreement or other material instrument filed as
an Exhibit to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2000 or any Form 10-Q or Form 8-K of
the Company filed subsequent to such date, (B) result in the
creation or imposition of any lien upon any properties of the
Company pursuant to the terms of any such indenture, agreement or
other instrument (other than as contemplated by the Basic Documents
and Section 1H(e) of Chapter 164 of the Massachusetts General
Laws), or (C) violate any Massachusetts or federal law or any
order, rule or regulation applicable to the Company of any
Massachusetts or federal court or regulatory body, administrative
agency or other governmental instrumentality having jurisdiction
over the Company, or any of its properties;
(vii) upon the delivery of the fully executed Sale
Agreement to the Note Issuer and the payment of the purchase price
of the Transition Property by the Note Issuer to the Seller
pursuant to the Sale Agreement, then (A) the transfer of the
Transition Property by the Seller to the Note Issuer pursuant to
the Sale Agreement conveys the Seller's right, title and interest
in the Transition Property to the Note Issuer and will be treated
under the laws of The Commonwealth of Massachusetts as an absolute
transfer of all of the Seller's right, title, and interest in the
Transition Property, other than for federal and state income tax
purposes, (B) such transfer of the Transition Property is
perfected, (C) such transfer has priority over any other assignment
of the Transition Property, and (D) the Transition Property is free
and clear of all liens created prior to its transfer to the Note
Issuer pursuant to the Sale Agreement;
(viii) to the extent described in the Final
Prospectus, the Sale Agreement, the Servicing Agreement and the
Administration Agreement, conform to the descriptions thereof
contained therein; and
(ix) the statements included in the Final Prospectus
under the headings "The Seller and Servicer" (other than under the
subheading "Billing and Collections" as to which such counsel need
not express any opinion) and "Servicing," to the extent that they
constitute matters of Massachusetts or federal laws or legal
conclusions with respect thereto, fairly summarize the matters
described therein.
In rendering such opinion, such counsel may rely (x) as to matters
involving the application of laws of any jurisdiction other than The
Commonwealth of Massachusetts or the United States, to the extent deemed
proper and specified in such opinion, upon the opinion of other counsel
of good standing believed to be reliable and who are satisfactory to
counsel for the Underwriters and (y) as to matters of fact, to the
extent deemed proper, on certificates of responsible officers of the
Company. References to the Final Prospectus in this paragraph (b)
include any supplements thereto at the Closing Date.
(c) The Representatives shall have received opinions of
counsel for the Note Issuer, portions of which may be delivered by Day,
▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, outside counsel for the Note Issuer, and portions of
which may be delivered by in-house counsel for the Note Issuer, as the
Representatives may agree, and portions of which may be delivered by
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, P.A., special Delaware counsel for the Note
Issuer, each dated the Closing Date, in form and substance reasonably
satisfactory to the Representatives, to the effect that:
(i) the Note Issuer has been duly formed and is validly
existing in good standing as a limited liability company under the
laws of the State of Delaware, with all necessary limited liability
company power and authority to execute, deliver and perform its
obligations under this Agreement, the Sale Agreement, the Servicing
Agreement, the Note Indenture, the Note Purchase Agreement, the
Administration Agreement, the Fee and Indemnity Agreement and the
Notes and is qualified to do business in The Commonwealth of
Massachusetts (and is registered as a foreign limited liability
company in The Commonwealth of Massachusetts);
(ii) the Sale Agreement, the Servicing Agreement, the
Note Indenture, the Note Purchase Agreement, the Administration
Agreement and the Fee and Indemnity Agreement have been duly
authorized, executed and delivered, and constitute legal, valid and
binding instruments enforceable against the Note Issuer in
accordance with their terms (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws or equitable principles affecting
creditors' rights generally from time to time in effect); and the
Notes have been duly authorized and executed, and when
authenticated in accordance with the provisions of the Note
Indenture and delivered to and paid for by the Trust in accordance
with the terms of the Note Purchase Agreement, will constitute
legal, valid and binding obligations of the Note Issuer entitled to
the benefits of the Note Indenture (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws or equitable principles affecting
creditors' rights generally from time to time in effect);
(iii) to the extent described in the Final
Prospectus, the Sale Agreement, the Servicing Agreement, the Note
Indenture, the Note Purchase Agreement, the Administration
Agreement, the Fee and Indemnity Agreement, the Limited Liability
Company Agreement, and the Notes conform to the descriptions
thereof contained therein;
(iv) the Note Indenture has been duly qualified under the
Trust Indenture Act;
(v) to the knowledge of such counsel, after having made
inquiry of officers of the Note Issuer, but without having made any
other investigation, there is no pending or threatened action, suit
or proceeding before any court or governmental agency, authority or
body or any arbitrator involving the Note Issuer, or challenging
the Notes, the Financing Order or the collection of the RTC Charge
or the use and enjoyment of Transition Property under the Statute
of a character required to be disclosed in the Registration
Statement which is not adequately disclosed in the Final
Prospectus, and there is no franchise, contract or other document
relating to the Note Issuer, the Notes or the Financing Order of a
character required to be described in the Registration Statement or
Final Prospectus, or to be filed as an exhibit, which is not
described or filed as required;
(vi) the statements included in the Final Prospectus
under the headings "Energy Deregulation and New Massachusetts
Market Structure" (to the extent the Statute is described),
"Description of the Transition Property," "The Note Issuer,"
"Servicing" (to the extent the Servicing Agreement or the Financing
Order is described) and "Description of the Notes," and under the
subheading "Bankruptcy and creditors' rights issues" under the
caption "Risk Factors," to the extent that they constitute matters
of Massachusetts, Delaware or federal law or legal conclusions with
respect thereto, fairly summarize the matters described therein;
(vii) the Registration Statement has become effective
under the Act; any required filing of the Basic Prospectus, any
Preliminary Final Prospectus and the Final Prospectus, and any
supplements thereto, pursuant to Rule 424(b) have been made in the
manner and within the time period required by Rule 424(b); to the
knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued, no
proceedings for that purpose have been instituted or threatened,
and the Registration Statement and the Final Prospectus (other than
(A) the information contained under the captions "The Trust," "The
State Agencies," "Federal Income Tax Consequences" and "State
Taxation," and to the extent statements contained under the
subheadings "Certificateholders could experience payment delays or
losses as a result of amendment, repeal or invalidation of the
restructuring statute or breach of the Commonwealth
pledge-Legislative or executive actions" and "-Court decisions"
under the caption "Risk Factors" represent the opinions of ▇▇▇▇▇▇ &
Dodge LLP, or (B) the financial statements including the notes
thereto or other financial data contained in the Final Prospectus
as to which such counsel need express no opinion) comply as to form
in all material respects with the applicable requirements of the
Act, the Exchange Act and the Trust Indenture Act and the
respective rules thereunder; and such counsel shall confirm, on the
basis of certain assumptions, that at the Effective Date no facts
have come to such counsel's attention which would cause such
counsel to believe that the Registration Statement contained any
untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading or that the Final Prospectus
as of its date and the Closing Date includes any untrue statement
of a material fact or omits to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading (other than (A) the
information contained under the captions "The Trust," "The State
Agencies," "Federal Income Tax Consequences" and "State Taxation,"
and to the extent statements contained under the subheadings
"Certificateholders could experience payment delays or losses as a
result of amendment, repeal or invalidation of the restructuring
statute or breach of the Commonwealth pledge-Legislative or
executive actions" and "-Court decisions" under the caption "Risk
Factors" represent the opinions of ▇▇▇▇▇▇ & Dodge LLP, or (B) the
financial statements including the notes thereto or other financial
data contained in the Final Prospectus as to which such counsel
need express no opinion);
(viii) this Agreement has been duly authorized,
executed and delivered by the Note Issuer;
(ix) no consent, approval, authorization or order of any
Massachusetts, Delaware or federal court or governmental agency or
body is required to be obtained by the Note Issuer for the issuance
of the Notes or the consummation by the Note Issuer of the
transactions contemplated herein, except such as have been obtained
under the Statute, the DTE Regulations, the 1935 Act and the Act
and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of
the Certificates by the Underwriters and such other approvals
(specified in such opinion) as have been obtained;
(x) neither the execution and delivery of this
Agreement, the Sale Agreement, the Servicing Agreement, the Note
Indenture, the Note Purchase Agreement, the Administration
Agreement or the Fee and Indemnity Agreement, nor the issuance and
sale of the Notes, nor the consummation of the transactions
contemplated by this Agreement, the Sale Agreement, the Servicing
Agreement, the Note Indenture, the Note Purchase Agreement, the
Administration Agreement or the Fee and Indemnity Agreement, nor
the fulfillment of the terms of this Agreement, the Sale Agreement,
the Servicing Agreement, the Note Indenture, the Note Purchase
Agreement, the Administration Agreement or the Fee and Indemnity
Agreement by the Note Issuer, will (A) conflict with, result in any
breach of any of the terms or provisions of, or constitute (with or
without notice or lapse of time) a default under the Limited
Liability Company Agreement of the Note Issuer, or conflict with or
breach any of the material terms or provisions of, or constitute
(with or without notice or lapse of time) a default under, any
indenture, agreement or other instrument known to such counsel and
to which the Note Issuer is a party or by which the Note Issuer is
bound, (B) result in the creation or imposition of any lien upon
any properties of the Note Issuer pursuant to the terms of any such
indenture, agreement or other instrument (other than as
contemplated by the Basic Documents and Section 1H(e) of Chapter
164 of the Massachusetts General Laws), or (C) violate any
Massachusetts, Delaware or federal law or any order, rule or
regulation applicable to the Note Issuer of any Massachusetts,
Delaware or federal court, regulatory body, administrative agency
or other governmental instrumentality having jurisdiction over the
Note Issuer, or any of its properties;
(xi) Upon the giving of value by the Note Trustee to the
Note Issuer with respect to the Collateral, (A) the Note Indenture
creates in favor of the Note Trustee a security interest in the
rights of the Note Issuer in the Collateral, (B) such security
interest is valid against the Note Issuer (subject to the rights of
any third parties holding security interests in such Collateral
perfected in the manner described in Sections 1H(d) and (e) of the
Statute), and has attached and (C) such security interest is
perfected; and
(xii) the Note Issuer is not, and after giving effect
to the offering and sale of the Certificates and the application of
the proceeds thereof as described in the Final Prospectus, will not
be, an "investment company" or under the "control" of an
"investment company" as such terms are defined under the Investment
Company Act of 1940, as amended.
In rendering such opinion, such counsel may rely (x) as to matters
involving the application of laws of any jurisdiction other than The
Commonwealth of Massachusetts, the State of Delaware or the United
States, to the extent deemed proper and specified in such opinion, upon
the opinion of other counsel of good standing believed to be reliable
and who are satisfactory to counsel for the Underwriters and (y) as to
matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Note Issuer and public officials.
References to the Final Prospectus in this paragraph (c) include any
supplements thereto at the Closing Date.
(d) The Representatives shall have received opinions of
counsel for the Trust and the Agencies, portions of which may be
delivered by ▇▇▇▇▇▇ & Dodge LLP or ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, both co-
special counsel for the Trust and the Agencies, and portions of which
may be delivered by ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, P.A., special Delaware
counsel for the Trust, and ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, special New York
counsel for the Trust, each dated the Closing Date, in form and
substance reasonably satisfactory to the Representatives, to the effect
that:
(i) the Declaration of Trust, the Certificate Indenture
and the Certificates conform in all material respects with the
descriptions thereof contained in the Final Prospectus under the
headings "The Trust" and "Description of the Certificates" (other
than matters regarding DTC, Clearstream and Euroclear, as to which
they shall be entitled to express no opinion) and in the Prospectus
Summary under the headings "The Certificates," "Issuer of
Certificates," "Interest" and "Principal";
(ii) the Trust has been duly created and is validly
existing in good standing as a business trust under the Delaware
Business Trust Act (being Chapter 38 of Title 12 of the Delaware
Code, 12 Del.C., 3801 et seq.,);
(iii) each of the Agencies is a duly created and
validly existing body politic and corporate and a public
instrumentality of The Commonwealth of Massachusetts with the
necessary power, authority and legal right to execute, deliver and
perform all of its obligations under the Declaration of Trust and
the issuance resolution of such Agency;
(iv) the Agencies have validly authorized and approved
the formation of the Trust, the issuance of the Certificates and
all other transactions and actions contemplated by the Basic
Documents or required to be taken by the Agencies as conditions
precedent to the issuance of the Certificates; such authorizations
and approvals are valid and in full force and effect;
(v) the Declaration of Trust has been duly authorized,
executed and delivered by the Agencies and, assuming the due
authorization, execution and delivery thereof by the Delaware
Trustee, constitutes a legal, valid and binding instrument
enforceable against the Agencies in accordance with its terms,
except as enforcement thereof may be subject to or limited by
bankruptcy, insolvency, moratorium, reorganization, fraudulent
conveyance or other laws relating to or affecting the enforcement
of creditors' rights generally, and except as limited by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(vi) the Certificate Indenture has been duly authorized,
executed and delivered by the Delaware Trustee on its own behalf
and separately on behalf of the Trust and, assuming the due
authorization, execution and delivery thereof by the Certificate
Trustee, constitutes a legal, valid and binding instrument,
enforceable against the Trust in accordance with its terms, except
as enforcement thereof may be subject to or limited by bankruptcy,
insolvency, moratorium, reorganization, fraudulent conveyance or
other similar laws relating to or affecting the enforcement of
creditors' rights generally, and except as limited by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(vii) the Certificates have been duly authorized and
executed and, when authenticated in accordance with the provisions
of the Certificate Indenture and delivered to and paid for by the
Underwriters pursuant to this Agreement, (A) the Certificates will
be duly issued in conformity with the Statute, (B) the Certificates
will constitute valid, fully paid and non-assessable undivided
beneficial interests in the Trust, (C) the Certificateholders will
be entitled to the benefits of the Certificate Indenture, (D) the
Certificates will constitute "electric rate reduction bonds" under
Section 1H(a) of Chapter 164 of the Massachusetts General Laws and
(E) the Certificateholders will be entitled to the rights and
benefits afforded under the Statute;
(viii) the Note Purchase Agreement has been duly
authorized, executed and delivered by the Delaware Trustee on
behalf of the Trust and, assuming due authorization, execution and
delivery thereof by WMECO Funding LLC, constitutes a legal, valid
and binding instrument, enforceable against the Trust in accordance
with its terms, except as enforcement thereof may be subject to or
limited by bankruptcy, insolvency, moratorium, reorganization,
fraudulent conveyance or other similar laws relating to or
affecting the enforcement of creditors' rights generally, and
except as limited by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity
or at law);
(ix) the Certificate Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended;
(x) the statements included in the Final Prospectus
under the headings "The Trust," "The State Agencies" and
"Description of the Certificates" fairly summarize the matters
described therein (other than matters related to DTC, Clearstream
or Euroclear, as to which they shall be entitled to express no
opinion) and the statements included or incorporated in the Final
Prospectus under the headings "Federal Income Tax Consequences,"
"State Taxation" and "ERISA Considerations," and under the
following subheadings of the caption "Risk Factors":
"Certificateholders could experience payment delays or losses as a
result of amendment, repeal or invalidation of the restructuring
statute or breach of the Commonwealth pledge-Legislative or
executive actions" and "-Court decisions," to the extent that they
constitute matters of Massachusetts, Delaware or federal law or
legal conclusions with respect thereto, provide a fair and accurate
summary of such law or conclusions;
(xi) to the knowledge of such counsel, there is no
pending or threatened action, suit or proceeding before any court
or governmental agency, authority or body or any arbitrator
challenging the validity or enforceability of the issuance
resolutions of the Agencies or actions taken by the Agencies in
connection therewith or otherwise involving the Agencies or
relating to the Certificates or the Trust of a character required
to be described in the Registration Statement or Final Prospectus,
or to be filed as an exhibit, which is not described or filed as
required;
(xii) to the knowledge of such counsel, the
Registration Statement and the Final Prospectus (other than (A) the
financial statements including the notes thereto and other
financial data contained therein, (B) information contained under
the captions "The Note Issuer" and "The Seller and Servicer," (C)
information regarding DTC, Clearstream and Euroclear and (D) the
statement of eligibility of the Trustee on Form T-l and the
documents incorporated by reference therein, as to which such
counsel shall not be required to make any statement or express any
opinion) comply as to form in all material respects with the
applicable requirements of the Act, the Exchange Act and the Trust
Indenture Act and the respective rules thereunder, and such counsel
shall confirm, on the basis of certain assumptions, that at the
Effective Date no facts have come to such counsel's attention which
would cause such counsel to believe that the Registration Statement
(other than (A) the financial statements including the notes
thereto or other financial data contained therein, (B) information
contained under the captions "The Note Issuer" and "The Seller and
Servicer," (C) information regarding DTC, Clearstream and Euroclear
and (D) the statement of eligibility of the Trustee on Form T-l and
the documents incorporated by reference therein, as to which such
counsel shall not be required to make any statement or express any
opinion) contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that
the Final Prospectus (other than (A) the financial statements
including the notes thereto or other financial data contained
therein, (B) information contained under the captions "The Note
Issuer" and "The Seller and Servicer," (C) information regarding
DTC, Clearstream and Euroclear and (D) the statement of eligibility
of the Trustee on Form T-l and the documents incorporated by
reference therein, as to which such counsel shall not be required
to make any statement or express any opinion) as of its date and
the Closing Date contained or contains any untrue statement of a
material fact or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading;
(xiii) no consent, approval, authorization or order of
any court or governmental agency or body is required to be obtained
by the Delaware Trustee, the Certificate Trustee or the Trust under
Massachusetts, Delaware or federal law for the issuance of the
Certificates by the Trust, except such as have been obtained under
the Statute, the DTE Regulations and the Act and such as may be
required under the blue sky laws of any jurisdiction in connection
with the purchase and distribution of the Certificates by the
Underwriters and such other approvals (specified in such opinion)
as have been obtained;
(xiv) neither the execution and delivery of the
Certificate Indenture, nor the issuance and sale of the
Certificates, nor the consummation of the transactions contemplated
by this Agreement or the Certificate Indenture, nor the fulfillment
of the terms of this Agreement or the Certificate Indenture by the
Trust will (A) conflict with, result in any breach of any of the
terms or provisions of, or constitute (with or without notice or
lapse of time) a default under the Certificate of Trust or
Declaration of Trust or other procedural documents of the Trust, or
conflict with or breach any of the material terms or provisions of,
or constitute (with or without notice or lapse of time) a default
under, any indenture, agreement or other instrument known to such
counsel and to which the Trust is a party or by which the Trust is
bound, (B) result in the creation or imposition of any lien upon
any properties of the Trust pursuant to the terms of any such
indenture, agreement or other instrument (except as contemplated by
the Basic Documents or created pursuant to the Statute), or
(C) violate any Massachusetts, Delaware or federal law, order, rule
or regulation applicable to the Trust of any Massachusetts,
Delaware or federal court, state regulatory body, administrative
agency or other governmental instrumentality having jurisdiction
over the Trust, or any of its properties;
(xv) neither the execution and delivery of the
Declaration of Trust and the certificate the form of which is
attached hereto as Appendix A (the "Appendix A Certificate"), nor
the consummation of the transactions contemplated by the
Declaration of Trust and the Appendix A Certificate, nor the
fulfillment of the terms of the Declaration of Trust and the
Appendix A Certificate by the Agencies will (A) conflict with or
breach any of the material terms or provisions, or constitute (with
or without notice or lapse of time) a default under any indenture,
agreement or other instrument known to such counsel and to which
the Agencies are parties or by which the Agencies are bound or (B)
violate any Massachusetts or federal law, order, rule or regulation
applicable to the Agencies or the decision of any Massachusetts or
federal court or of any federal or Massachusetts state regulatory
body, administrative agency or other governmental instrumentality
having jurisdiction over the Agencies; and
(xvi) the Trust is not an "investment company" or
under the "control" of an "investment company" as such terms are
defined under the Investment Company Act of 1940, as amended.
In rendering such opinion, such counsel may (A) rely as to matters
involving the application of laws of any jurisdiction other than The
Commonwealth of Massachusetts, the State of Delaware or the United
States, to the extent deemed proper and specified in such opinion, upon
the opinion of other counsel of good standing believed to be reliable
and who are satisfactory to counsel for the Underwriters, (B) as to
matters relating to actions taken by the Company, the Note Issuer, the
Note Trustee, the DTE and the Servicer, assume such matters which are
the subject of opinions rendered by counsel to such parties hereunder or
under the Basic Documents, and (C) rely as to matters of fact, to the
extent deemed proper, on certificates of authorized representatives of
the Trust, the Agencies and public officials. References to the Final
Prospectus in this paragraph (d) include any supplements thereto at the
Closing Date.
(e) The Representatives shall have received opinions of
counsel to the Note Trustee, portions of which may be delivered by
▇▇▇▇▇▇▇▇ Ronon ▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, counsel to the Note Trustee, and
portions of which may be delivered by ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ ▇▇▇,
special New York counsel for the Note Trustee, each dated the Closing
Date, in form and substance reasonably satisfactory to the
Representatives, to the effect that:
(i) the Note Trustee is duly organized and validly
existing as a state banking institution in good standing under the
laws of the State of New York, with full corporate trust power and
authority to enter into and perform its obligations under the Note
Indenture;
(ii) the Note Indenture has been duly authorized,
executed and delivered, and constitutes a legal, valid and binding
instrument enforceable against the Note Trustee in accordance with
its terms (subject, as to enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium or other similar
laws or equitable principles affecting creditors' rights generally
from time to time in effect); and
(iii) the Notes have been duly authenticated by the
Note Trustee.
(f) The Representatives shall have received opinions of
counsel to the Certificate Trustee, portions of which may be delivered
by ▇▇▇▇▇▇▇▇ Ronon ▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, counsel to the Certificate
Trustee, and portions of which may be delivered by ▇▇▇▇▇, ▇▇▇▇▇▇ &
Martin LLP, special New York counsel for the Certificate Trustee, each
dated the Closing Date, in form and substance reasonably satisfactory to
the Representatives, to the effect that:
(i) the Certificate Trustee is duly organized and
validly existing as a state banking institution in good standing
under the laws of the State of New York, with full corporate trust
power and authority to enter into and perform its obligations under
the Note Indenture;
(ii) the Certificate Indenture has been duly authorized,
executed and delivered by the Certificate Trustee and constitutes a
legal, valid and binding instrument enforceable against the
Certificate Trustee in accordance with its terms (subject, as to
enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws or equitable
principles affecting creditors' rights generally from time to time
in effect); and
(iii) the Certificate Trustee has duly authenticated
and delivered the Certificates issued on the Closing Date on behalf
of the Trust;
(g) The Representatives shall have received an opinion of
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.A., counsel to the Delaware Trustee, dated
the Closing Date, in form and substance reasonably satisfactory to the
Representatives, to the effect that:
(i) the Delaware Trustee is duly incorporated and
validly existing as a banking corporation in good standing under
the laws of the State of Delaware, with full corporate trust power
and authority to enter into and perform its obligations under the
Declaration of Trust, and under the Note Purchase Agreement and the
Certificate Indenture on behalf of the Trust;
(ii) the Declaration of Trust, the Certificate Indenture
and the Note Purchase Agreement (on behalf of the Trust) have been
duly authorized, executed and delivered by the Delaware Trustee,
and constitute legal, valid and binding instruments enforceable
against the Delaware Trustee in accordance with their terms
(subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws or
equitable principles affecting creditors' rights generally from
time to time in effect);
(iii) the Delaware Trustee has duly executed the
Certificates issued on the Closing Date on behalf of the Trust;
(h) The Representatives shall have received from
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Underwriters, such
opinion or opinions, dated the Closing Date, with respect to the
issuance and sale of the Notes and the Certificates, the Note Indenture,
the Certificate Indenture, the Registration Statement, the Final
Prospectus (together with any supplement thereto) and other related
matters as the Representatives may reasonably require, and the Company,
the Note Issuer and the Trust shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.
(i) The Representatives shall have received a certificate of
the Note Issuer, signed by an officer of the Note Issuer, dated the
Closing Date, to the effect that the signer of such certificate has
carefully examined the Registration Statement, the Final Prospectus, any
supplement to the Final Prospectus and this Agreement and that:
(i) the representations and warranties of the Note
Issuer in this Agreement and in the Note Indenture are true and
correct in all material respects on and as of the Closing Date with
the same effect as if made on the Closing Date, and the Note Issuer
has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to
the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Note Issuer's knowledge,
threatened; and
(iii) since the dates as of which information is
given in the Final Prospectus (exclusive of any supplement
thereto), there has been no material adverse change in (A) the
condition (financial or other), earnings, business or properties of
the Note Issuer, whether or not arising from transactions in the
ordinary course of business, or (B) the Transition Property, except
as set forth in or contemplated in the Final Prospectus (exclusive
of any supplement thereto).
(j) The Representatives shall have received a certificate of
the Company, signed by an executive officer of the Company, dated the
Closing Date, to the effect that the signer of such certificate has
carefully examined the Registration Statement, the Final Prospectus, any
supplement to the Final Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in
this Agreement, the Sale Agreement and the Servicing Agreement are
true and correct in all material respects on and as of the Closing
Date with the same effect as if made on the Closing Date, and the
Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to
the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and
(iii) since the dates as of which information is
given in the Final Prospectus (exclusive of any supplement
thereto), there has been no material adverse change in (A) the
condition (financial or other), earnings, business or properties of
the Company and its subsidiaries taken as a whole, whether or not
arising from transactions in the ordinary course of business, or
(B) the Transition Property, except as set forth in or contemplated
in the Final Prospectus (exclusive of any supplement thereto).
(k) At the Closing Date, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP shall have
furnished to the Representatives (i) a letter or letters (which may
refer to letters previously delivered to one or more of the
Representatives), dated as of the Closing Date, in form and substance
satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange
Act and the respective applicable published rules and regulations
thereunder, that they consent to the inclusion of their report on the
audited financial statements of the Issuer and the reference to them as
experts under the heading "Experts" in the Basic Prospectus and the
Final Prospectus, and stating in effect that they have performed certain
specified procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature (which is
limited to accounting, financial or statistical information derived from
the general accounting records of the Company and the Note Issuer) set
forth in the Registration Statement and the Final Prospectus, including
information specified by the Underwriters and set forth under the
captions "Prospectus Summary," "Description of the Transition Property,"
"The Seller and Servicer," "Description of the Notes" and "Description
of the Certificates" in the Final Prospectus, agrees with the accounting
records of the Company and the Note Issuer, excluding any questions of
legal interpretation, and (ii) the opinion or certificate, dated as of
the Closing Date, in form and substance satisfactory to the
Representatives, satisfying the requirements of Section 2.10(g) of the
Note Indenture.
References to the Final Prospectus in this paragraph (k) include
any supplement thereto at the date of the letter.
In addition, at the Execution Time, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP shall have
furnished to the Representatives a letter or letters, dated as of the
Execution Time, in form and substance satisfactory to the
Representatives, to the effect set forth above.
(l) Subsequent to the Execution Time or, if earlier, the
dates as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Final Prospectus (exclusive
of any supplement thereto), there shall not have been any change, or any
development involving a prospective change, in or affecting either
(i) the business, properties or financial condition of the Company or
the Note Issuer or (ii) the Transition Property, the Notes, the
Certificates, the Financing Order or the Statute, the effect of which
is, in the judgment of the Representatives, so material and adverse as
to make it impractical or inadvisable to proceed with the offering or
delivery of the Notes or the Certificates as contemplated by the
Registration Statement (exclusive of any amendment thereof) and the
Final Prospectus (exclusive of any supplement thereto).
(m) The Representatives shall have received on the Closing
Date an opinion letter or letters of Day, ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel to
the Company and the Note Issuer, dated the Closing Date, in form and
substance reasonably satisfactory to the Representatives, (i) with
respect to the characterization of the transfer of the Transition
Property by the Company to the Note Issuer as a "true sale" for
bankruptcy purposes and (ii) to the effect that a court would not order
the substantive consolidation of the assets and liabilities of the Note
Issuer with those of the Company in the event of a bankruptcy,
reorganization or other insolvency proceeding involving the Company.
(n) The Representatives shall have received on the Closing
Date an opinion letter of ▇▇▇▇▇▇ & Dodge LLP, special counsel to
Agencies and the Trust, dated the Closing Date, in form and substance
reasonably satisfactory to the Representatives, to the effect that a
court would not order the substantive consolidation of the assets and
liabilities of Agencies with those of the Trust.
(o) The Representatives shall have received on the Closing
Date an opinion letter or letters of counsel for the Company, portions
of which may be delivered by Day, ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, outside counsel
for the Company, and portions of which may be delivered by in-house
counsel for the Company, as the Representatives may agree, each dated
the Closing Date, in form and substance reasonably satisfactory to the
Representatives, to the effect that: (i) the Financing Order has been
duly issued and authorized by the DTE and the Financing Order, giving
effect to the Issuance Advice Letter, is effective; (ii) in reliance on
the opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP that the Certificates are
"electric rate reduction bonds" under Section 1H(a) of Chapter 164 of
the Massachusetts General Laws, as of the issuance of the Certificates,
the Certificates are entitled to the protections provided in
Sections 1H(b)(3) and 1H(c)(4) of the Statute; (iii) the Financing Order
is no longer subject to appeal by any person; and (iv) the Servicer is
authorized to file periodic RTC Charge adjustments to the extent
necessary to ensure the timely recovery of revenues sufficient to
provide for the payment of an amount equal to the sum of the periodic
RRB payment requirements for the upcoming year, which includes indemnity
obligations under the Basic Documents.
(p) The Representatives shall have received on the Closing
Date an opinion letter or letters of ▇▇▇▇▇▇ & Dodge LLP, special counsel
for the Agencies and the Trust, dated the Closing Date, in form and
substance reasonably satisfactory to the Representatives, to the effect
that any state action (whether by legislative, DTE, citizen initiative
or otherwise) to revoke or limit the Financing Order, the Issuance
Advice Letter, the Transition Property or the RTC Charge in a manner
which would substantially impair the rights of Certificateholders would
be subject to a successful constitutional contracts clause and/or
takings clause defense.
(q) The Representatives shall have received on the Closing
Date an opinion letter or letters of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.A.,
special Delaware counsel to the Note Issuer, dated the Closing Date, in
form and substance reasonably satisfactory to the Representatives, to
the effect that: (i) if properly presented to a Delaware court, a
Delaware court applying Delaware law, would conclude that (x) in order
for a person to file a voluntary bankruptcy petition on behalf of the
Note Issuer, the affirmative vote of the Note Issuer's Sole Member (as
defined in the Limited Liability Company Agreement) and the affirmative
vote of all of the Directors (including the Independent Directors (as
defined in the Limited Liability Company Agreement)), as provided in
Section 2.07(b) of the Limited Liability Company Agreement of the Note
Issuer, is required, and (y) such provision, contained in
Section 2.07(b) of the Limited Liability Company Agreement, that
requires the affirmative vote of the Note Issuer's Sole Member and the
affirmative vote of all of the Directors (including the Independent
Directors) in order for a person to file a voluntary bankruptcy petition
on behalf of the Note Issuer, constitutes a legal, valid and binding
agreement of the Sole Member and is enforceable against the Sole Member,
in accordance with its terms; and (ii) the Limited Liability Company
Agreement constitutes a legal, valid and binding agreement of the Sole
Member thereunder, and is enforceable against the Sole Member in
accordance with its terms.
(r) The Notes and the Certificates shall have been rated in
the highest long-term rating category by each of the Rating Agencies.
(s) On or prior to the Closing Date, the Note Issuer shall
have delivered to the Representatives evidence, in form and substance
reasonably satisfactory to the Representatives, that appropriate filings
have been or are being made in accordance with the Statute and other
applicable law reflecting the grant of a security interest by the Note
Issuer in the Collateral to the Note Trustee.
(t) On or prior to the Closing Date, the Note Issuer shall
have delivered to the Representatives copies, certified to the
satisfaction of the Representatives, of the Financing Order and the
Issuance Advice Letter.
(u) Prior to the Closing Date, the Note Issuer, the Company
and the Trust shall have furnished to the Representatives and the
Agencies such further information, certificates, opinions and documents
as the Representatives and the Agencies may reasonably request,
including being included as addressees of, or receiving a letter
entitling the Representatives and the Agencies to rely on, each legal
opinion addressed to the rating agencies or the parties to the
transactions and each related certificate, if any.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters
hereunder may be canceled at, or at any time prior to, the Closing Date by
the Representatives. Notice of such cancellation shall be given to the Note
Issuer and the Trust in writing or by telephone or electronic mail confirmed
in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Day, ▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, Hartford, Connecticut,
on the Closing Date.
7. Expenses. Upon the sale of the Certificates, the Note Issuer
will pay or cause to be paid all costs and expenses incident to the
performance of the obligations of the Company, the Note Issuer, the Trust and
the Underwriters hereunder and the Agencies under the Basic Documents,
including, without limiting the generality of the foregoing, all costs, taxes
and expenses incident to the issuance and delivery of the Certificates to the
Underwriters, all fees, disbursements and expenses of the Company's, the Note
Issuer's, the Trust's, the Agencies' and the Underwriters' counsel and
accountants, all costs and expenses incident to the preparation, printing and
filing of the Registration Statement (including all exhibits thereto), any
preliminary prospectus, the Basic Prospectus, any Preliminary Final
Prospectus, the Final Prospectus and any amendments thereof or supplements
thereto, all costs and expenses incurred in connection with blue sky
qualifications, examining the legality of the Certificates for the investment
and the rating of the Certificates, all costs and expenses of the Note
Trustee, the Certificate Trustee and the Delaware Trustee, all costs and
expenses incurred in the acquisition or preparation of documents required to
be delivered by the Company, the Note Issuer, the Trust or the Agencies in
connection with the closing of the transactions contemplated hereby, all
costs and expenses required in connection with any filing with the National
Association of Securities Dealers in connection with the transactions
contemplated hereby, and all costs and expenses of the printing and
distribution of all documents in connection with the Certificates.
If the sale of the Certificates provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 6 hereof is not satisfied, because of any termination
pursuant to Section 10 hereof or because of any refusal, inability or failure
on the part of the Company, the Note Issuer or the Trust to perform any
agreement herein or comply with any provision hereof other than by reason of
a default (including under Section 9) by any of the Underwriters, the Company
and the Note Issuer will, jointly and severally, reimburse the Underwriters
upon demand for all out-of-pocket expenses (including reasonable fees and
disbursements of counsel) that shall have been incurred by the Underwriters
in connection with the proposed purchase and sale of the Certificates.
8. Indemnification and Contribution.
(a) The Company and the Note Issuer will, jointly and
severally, indemnify and hold harmless each Underwriter, the Trust, the
Agencies, the Commonwealth of Massachusetts and the Executive Office for
Administration and Finance of the Commonwealth of Massachusetts, the
directors, officials, officers, members, consultants, counsel, employees
and agents of each Underwriter, the Trust, the Agencies, the
Commonwealth of Massachusetts and the Executive Office for
Administration and Finance of the Commonwealth of Massachusetts and each
person who controls any Underwriter, the Trust, the Agencies, the
Commonwealth of Massachusetts and the Executive Office for
Administration and Finance of the Commonwealth of Massachusetts within
the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or
other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement for the registration of the Certificates as
originally filed or in any amendment thereof, or any omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, any untrue
statement or alleged untrue statement of a material fact contained in
the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus, or in any amendment thereof or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading, and will reimburse each such indemnified
party, as incurred, for any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that neither the
Company nor the Note Issuer will be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or
is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Note Issuer or the
Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in
addition to any liability which the Company and the Note Issuer may
otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, the Note Issuer, the Trust, the Agencies, the
Commonwealth of Massachusetts and the Executive Office for
Administration and Finance of the Commonwealth of Massachusetts, each of
their directors, each of their officials, counsel, consultants, agents
and employees, each of their officers (if any) who signs the
Registration Statement, and each person who controls the Company or the
Note Issuer within the meaning of either the Act or the Exchange Act, to
the same extent as the foregoing indemnity from the Company and the Note
Issuer to each Underwriter, but only with reference to written
information relating to such Underwriter furnished to the Note Issuer or
the Company by or on behalf of such Underwriter through the
Representatives specifically for inclusion in the documents referred to
in the foregoing indemnity. This indemnity agreement will be in
addition to any liability which any Underwriter may otherwise have. The
Note Issuer, the Company and the Agencies acknowledge that the
statements set forth in the second full paragraph, the second sentence
of the fourth full paragraph and the fifth full paragraph under the
heading "Underwriting" or the third full paragraph (other than the last
sentence thereof) under the heading "Plan of Distribution" in the Final
Prospectus constitute the only information furnished in writing by or on
behalf of the several Underwriters for inclusion in the documents
referred to in the foregoing indemnity, and you, as the Representatives,
confirm that such statements are correct.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party
in writing of the commencement thereof; but the failure so to notify the
indemnifying party (i) will not relieve it from liability under
paragraph (a) or (b) above unless and to the extent it did not otherwise
learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not,
in any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled to
appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for
which indemnification is sought (in which case the indemnifying party
shall not thereafter be responsible for the fees and expenses of any
separate counsel retained by the indemnified party or parties except as
set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the
right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party 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 party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party,
(iii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified party
within a reasonable time after notice of the institution of such action
or (iv) the indemnifying party shall authorize the indemnified party to
employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, 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 or contribution may be
sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action,
suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold
harmless an indemnified party for any reason, the Company, the Note
Issuer and the Underwriters agree to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same)
(collectively "Losses") to which the Company, the Note Issuer and one or
more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company,
Note Issuer and the Underwriters, respectively, from the offering of the
Certificates and the Notes; provided, however, that in no case shall any
Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Certificates) be
responsible for any amount in excess of the underwriting discount or
commission applicable to the Certificates purchased by such Underwriter
hereunder. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Company, the Note Issuer and
the Underwriters shall contribute in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault
of the Company, the Note Issuer and of the Underwriters in connection
with the statements or omissions which resulted in such Losses as well
as any other relevant equitable considerations. The relative benefits
received by the Company or the Note Issuer shall be deemed to be equal
to the total net proceeds from the offering (before deducting expenses)
of the Certificates (which shall be equal to the net proceeds from the
sale of the Notes to the Trust (before deducting expenses)), and
benefits received by the Underwriters shall be deemed to be equal to the
total underwriting discounts and commissions, in each case as set forth
on the cover page of the Final Prospectus. Relative fault shall be
determined by reference to whether any alleged untrue statement or
omission relates to information provided by the Company, the Note Issuer
or the Underwriters. The Company, the Note Issuer and the Underwriters
agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation
which does not take account of the equitable considerations referred to
above. Notwithstanding the provisions of this paragraph, no person
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 8, each person who controls an Underwriter
within the meaning of either the Act or the Exchange Act and each
director, officer, employee and agent of an Underwriter shall have the
same rights to contribution as such Underwriter, and each person who
controls the Note Issuer or the Company within the meaning of either the
Act or the Exchange Act, each officer of the Note Issuer or the Company
who shall have signed the Registration Statement and each director of
the Note Issuer or the Company shall have the same rights to
contribution as the Note Issuer or the Company, subject in each case to
the applicable terms and conditions of this paragraph. The
Underwriters' obligations in this paragraph to contribute are several in
proportion to their respective underwriting obligations and not joint.
9. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Certificates agreed to be
purchased by such Underwriter or Underwriters hereunder the Representatives
may in their discretion arrange for the Underwriters or another party or
other parties to purchase such Certificates on the terms contained herein.
If within 36 hours after such default by any Underwriter the Representatives
do not arrange for the purchase of such Certificates, the nondefaulting
Underwriters shall be obligated severally to take up and pay for (in the
respective proportions which the amount of Certificates set forth opposite
the names of all the remaining Underwriters) the Certificates which the
defaulting Underwriter or Underwriters agreed but failed to purchase;
provided, however, that in the event that the aggregate amount of
Certificates which the defaulting Underwriter or Underwriters agreed but
failed to purchase shall exceed 10% of the aggregate amount of Certificates
set forth in Schedule II hereto, the nondefaulting Underwriters shall have
the right to purchase all, but shall not be under any obligation to purchase
any, of the Certificates, and if such nondefaulting Underwriters do not
purchase all the Certificates, this Agreement will terminate without
liability to any nondefaulting Underwriter, the Note Issuer or the Company.
In the event of a default by any Underwriter as set forth in this Section 9,
the Closing Date shall be postponed for such period, not exceeding seven
days, as the Representatives shall determine in order that the required
changes in the Registration Statement and the Final Prospectus or in any
other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any,
to the Note Issuer and the Company and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representatives, by notice given to the
Company, the Note Issuer and the Agencies prior to delivery of and payment
for the Certificates, if prior to such time there shall have occurred (a) any
change, or any development involving a prospective change, in or affecting
(i) the business, properties or financial condition of the Company or the
Note Issuer or (ii) the Transition Property, the Notes, the Certificates, the
Financing Order or the Statute, the effect of which, in the judgment of the
Representatives, materially impairs the investment quality of the
Certificates or makes it impractical or inadvisable to market the
Certificates; (b) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (c) a suspension or
material limitation in trading in the securities of the Company or its
holding company; (d) a general moratorium on commercial banking activities
shall have been declared either by federal, New York state or Massachusetts
state authorities; or (e) any outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war or other calamity or crisis the effect of which on financial
markets is such as to make it, in the judgment of the Representatives,
impracticable or inadvisable to proceed with the offering or delivery of the
Certificates as contemplated by the Final Prospectus (exclusive of any
supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of
the Company or its officers, the Note Issuer or its officers and of the
Underwriters set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf
of any Underwriter or of the Company, the Note Issuer or any of the officers,
directors or controlling persons referred to in Section 8 hereof, and will
survive delivery of and payment for the Certificates. The provisions of
Sections 7 and 8 hereof shall survive the termination or cancellation of this
Agreement.
12. Notices. All communications hereunder 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, and if sent to the Representatives, to them at the address specified
in Schedule I hereto,
if to the Company, to:
Western Massachusetts Electric Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Assistant Treasurer-Finance
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Western Massachusetts Electric Company
c/o Northeast Utilities Service Company
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Assistant Treasurer-Finance
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Note Issuer, to:
WMECO Funding LLC
c/o Western Massachusetts Electric Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Assistant Treasurer-Finance
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Western Massachusetts Electric Company
c/o Northeast Utilities Service Company
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Assistant Treasurer-Finance
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇;
if sent to the Agencies, to:
Massachusetts Development Finance Agency
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
and
Massachusetts Health and Educational Facilities Authority
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
The parties hereto, by notice to the others, may designate
additional or different addresses for subsequent communications.
13. Successors. This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8
hereof, and no other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York.
15. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be deemed an original, which taken together
shall constitute one and the same instrument.
16. Miscellaneous. Time shall be of the essence of this
Agreement. As used herein, the term "business day" shall mean any day when
the SEC's office in Washington, D.C. is open for business.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company, the Note Issuer and the several Underwriters.
Very truly yours,
WESTERN MASSACHUSETTS ELECTRIC COMPANY
By: /s/▇▇▇▇▇ ▇.▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Treasurer-Finance
WMECO FUNDING LLC
By: /s/▇▇▇▇▇ ▇.▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
CONFIRMED AND ACCEPTED
on behalf of each of the Underwriters
▇▇▇▇▇▇ BROTHERS INC.
By: /s/▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
(▇▇▇▇▇▇ Brothers Inc.)
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By: /s/▇▇▇▇ ▇▇▇▇▇▇▇
(▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.)
SCHEDULE I to the
Underwriting Agreement
Underwriting Agreement dated May 14, 2001
Registration Statement No. 333-59118
Representative(s):
▇▇▇▇▇▇ Brothers Inc.
Three World Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Title: Massachusetts RRB Special Purpose Trust WMECO-1
$155,000,000 Rate Reduction Certificates
Principal ▇▇▇▇▇▇, Price to Public, Underwriting Discounts and Commissions and
Proceeds to Trust:
Scheduled
Total Price Underwriting Proceeds Final Final
Principal to Discounts to Distribution Termination
Amount public and Trust Date Date
Commissions
$155,000,000 $154,920,160 $655,650 $153,964,510 6/1/2013 6/1/2015
Original Issue Discount (if any): $79,840.00
Redemption provisions: Optional Redemption and Mandatory
Redemption as set forth in Article X of
the Note Indenture
Closing Date, Time and Location: May 17, 2001
9:00 a.m., Eastern Time
Hartford, Connecticut
Type of Offering: Delayed Offering
SCHEDULE II to the
Underwriting Agreement
Principal Amount of Certificates to be Purchased
Underwriters
▇▇▇▇▇▇ Brothers Inc. $77,500,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. $77,500,000
Total $155,000,000
APPENDIX A to the
Underwriting Agreement
CERTIFICATE OF THE AGENCIES PURSUANT
TO FINANCING ORDER APPROVING FINAL TERMS AND
CONDITIONS OF WMECO FUNDING LLC NOTES AND
MASSACHUSETTS RRB SPECIAL PURPOSE TRUST
WMECO-1 RATE REDUCTION CERTIFICATES
Pursuant to order number 24 of the Financing Order, the Massachusetts
Development Finance Agency and the Massachusetts Health and Educational
Facilities Authority (collectively, the "Agencies"), hereby approve the final
terms and conditions of the WMECO Funding LLC Notes (the "Notes") and the
Massachusetts RRB Special Purpose Trust WMECO-1 Rate Reduction Certificates
(the "Certificates"), as set forth in the underwriting agreement dated as of
May 14, 2001 by and among WMECO Funding LLC, Western Massachusetts Electric
Company and ▇▇▇▇▇▇ Brothers Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., as
representatives (the "Representatives") of the several Underwriters named
therein (the "Underwriting Agreement").
In furtherance of this approval, the Agencies authorize the
Massachusetts RRB Special Purpose Trust WMECO-1, a Delaware business trust
(the "Trust"), to issue the Certificates and otherwise comply with the terms
and conditions of the Underwriting Agreement.
WMECO Funding LLC, Western Massachusetts Electric Company and the
Representatives are entitled to rely on this certificate as if this
certificate were a part of, and the Agencies were parties to, the
Underwriting Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meaning set forth in the Underwriting Agreement.
Dated: May [ ], 2001
MASSACHUSETTS DEVELOPMENT FINANCE AGENCY
By:
Name:
Title:
MASSACHUSETTS HEALTH AND EDUCATIONAL FACILITIES
AUTHORITY
By:
Name:
Title: