P.R. Laws tit. 22, § 1073
The following words or terms shall have the meaning expressed below when used in this chapter, unless the context clearly indicates otherwise:
(1) System assets.— Means the electric power generation, transmission, and distribution facilities (and other property and equipment used in connection therewith), whether now existing or hereafter acquired, owned by the Authority as of the effective date of this Act or thereafter acquired for use by the Authority, including any successor electric utility, to provide electric power service to Customers, including any transmission and distribution service.
(2) Authority.— Means the Puerto Rico Electric Power Authority, a public corporation and government instrumentality established and existing by virtue of §§ 191--217 of this title, and any successor or successors thereto, including successors referred to in Section 35 and Chapter IV of this Act.
(3) Restructuring bonds.— Means bonds, or other evidences of long-term indebtedness issued by the Corporation pursuant to this chapter, any restructuring resolution and the trust agreement related thereto:
(a) whose proceeds are used, directly or indirectly, to finance or refinance approved restructuring costs;
(b) which are directly or indirectly secured by, or payable from, restructuring property; and
(c) which have a term of not less than one (1) year nor more than thirty-five (35) years.
(4) Cause.— Means, with respect to a director of the Corporation: (a) actions or inactions of such director that constitute recklessness or bad faith or gross negligence in connection with the duties of such director pursuant to this chapter and other organizational documents of the Corporation; (b) such director’s engagement in, accusation, or conviction of fraud or other actions constituting an offense under any law applicable to such director; (c) such director’s inability to perform his/her duties as director due to death or disability; (d) such director’s failure to meet the requirements of this chapter; or (e) any other action or inaction as set forth in this chapter.
(5) Defeasance.— Means with respect to any debt, the legal or economic defeasance of such debt. “Defease” has a meaning correlative thereto.
(6) Transition charges.— Means those rates and charges that are independent from rates and charges of the Authority and that are imposed on customers in accordance with a Restructuring Resolution to recover the ongoing financing costs, and shall include a pro rata portion of any late payment fee imposed with respect to any past due electricity bill that includes therein a sum for transition charges.
(7) Customer.— Means any person that is connected to or takes or receives electric power service, within the Commonwealth of Puerto Rico, from the electric power generation, transmission, or distribution facilities that are part of the System Assets, whether or not those electric power generation, transmission, or distribution facilities are owned by the Authority. The Authority shall not be considered a customer. Each municipality of the Commonwealth of Puerto Rico shall be considered a customer to the extent that the dollar value of its electric power service usage in any fiscal year (including, when determining such value, the dollar value of the transition charges, which would otherwise be imposed on such municipality, and the Authority charges) exceeds the dollar value owed by the Authority to such municipality as a contribution in lieu of taxes for such fiscal year.
(8) Commission.— Means the Puerto Rico Energy Commission established by §§ 1051 et seq. of this title.
(9) Ancillary agreement.— Means any bond insurance, letter of credit, reserve account, surety bond, interest rate or swap agreement, hedge agreement, liquidity agreement or credit support annex or other agreement intended to promote the credit quality and marketability of restructuring bonds or to mitigate the risk of changes in interest rates.
(10) Trust agreement.— Means a trust agreement, trust indenture, or similar contract or agreement entered into by the Corporation and the trustee establishing the rights and responsibilities of the Corporation and of the holders of restructuring bonds issued thereunder and secured thereby.
(11) Servicing agreement.— Means the agreement or agreements between the Corporation and the servicer providing for the administration and servicing of restructuring property, as the same may are modified from time to time by the parties thereto in a manner not prohibited by this chapter.
(12) Corporation.— Means the Puerto Rico Electric Power Authority Revitalization Corporation, a special-purpose public corporation and a government instrumentality of the Commonwealth of Puerto Rico, established pursuant to § 1064 of this title.
(13) Financing costs.— Means the costs to issue, service, repay, or refinance restructuring bonds, whether incurred upon issuance of such Restructuring Bonds or over the term of the restructuring bonds, the recovery of which is authorized through a restructuring resolution. Without limitation thereto, “financing costs” may include any of the following, as the case may be:
(a) The principal of, interest on, and redemption premiums of restructuring bonds;
(b) any payment required under the terms of an ancillary agreement and any amount required to deposit or replenish (or to reimburse a third party for replenishing) a debt service reserve fund or account, operating expenditures reserve fund or account, or other fund or account established in accordance with a trust agreement, any ancillary agreement, resolution or other financing document related to the restructuring bonds;
(c) any federal or state tax or charge, including federal or state payments or contributions in lieu of taxes, franchise fees or license fees imposed on transition charge revenues (but excluding any Commonwealth or local taxes, fees or contributions or payments in lieu of taxes);
(d) any cost related to obtaining a restructuring order, or administering the Corporation, the restructuring bonds or the restructuring property, including the costs of implementing the adjustment mechanism, trustee (and other similar fiduciary), legal, accounting and other consultants, depository, calculation agent, manager, credit rating agency fees and expenses, and servicing fees and expenses, in each case, subject to the provisions of this chapter;
(e) any cost related to protecting the status of restructuring property and collecting transition charges, including any cost related to any judicial or similar proceedings that the Corporation or the trustee or any owner of all or a portion of restructuring property deems necessary to demand the payment of or collect transition charge revenues, or protect the restructuring property or any other costs referred to in § 1070(a) of this title, in each case, subject to the provisions of this chapter, and
(f) any other cost related to issuing Restructuring Bonds, or administering and servicing restructuring property and restructuring bonds, including the cost of calculating adjustments of transition charges, servicing fees and expenses, trustee (or similar fiduciary) fees and expenses, legal fees and expenses, accounting fees and expenses, administration fees and expenses, placement fees and expenses, underwriting fees and expenses, printing and marketing fees, filing or listing fees, fees and expenses of the Corporation’s other consultants, if any, rating agency fees, and any other cost approved by the Board of the Corporation as necessary or desirable to achieve the purposes of this chapter.
(14) Upfront financing costs.— Means the financing costs related to obtaining the restructuring order, the design, marketing, and issuance of restructuring bonds, except to the extent that the Corporation determines to pay said costs as ongoing financing costs payable from transition charge revenues. upfront financing costs include, without limitation, trustee (or similar fiduciary) fees and expenses, legal fees and expenses, accounting fees and expenses, servicer set-up rates or expenses, calculation agent, depository or other manager or fiduciary placement fees and expenses, underwriting fees and expenses, printing and marketing fees, filing or listing and compliance fees, fees and expenses of the Corporation’s other consultants, if any, credit rating agency fees, collateral fees and expenses, and any other cost approved by the Board of the Corporation as necessary or desirable to achieve the purposes of this chapter and shall include reimbursement to any person of amounts paid in advance to cover such costs.
(15) Approved restructuring costs.— Means any or all of the following costs approved under a restructuring resolution:
(a) the capital expenditures related to the construction and outfitting of the Aguirre Offshore Gasport, subject to satisfaction of any conditions set forth in the applicable trust agreement for any outstanding restructuring bonds;
(b) the costs of retiring or defeasing all or a portion of the Authority’s debt obligations or the restructuring bonds;
(c) rebate, yield reduction payments and any other amounts payable to the United States of America to preserve or protect the federal tax exemption outstanding debt obligations of the Authority or the Corporation;
(d) deposits from proceeds of restructuring bonds made to a capitalized interest fund or account, debt service reserve fund or account, or operating expenses reserve fund or account established in connection with such restructuring bonds; and, only in connection with the first issue of restructuring bonds, a deposit to the Self-Insurance Fund, established pursuant to the trust agreement, dated on January 1st, 1974, as amended, by and between the Authority and the U.S. Bank National Association, as successor trustee, in an amount not to exceed one hundred million dollars ($100,000,000); and
(e) subject to any limitations provided in this chapter, the financing costs. The restructuring resolution shall not include in any manner whatsoever, the cost of retiring a debt of the Authority that has not been included in the creditors’ agreement, except for debt incurred in 2016 in an amount not to exceed five hundred thirty-five million dollars ($535,000,000).
(16) Ongoing financing costs.— Means financing costs other than upfront financing costs and any excess of actual upfront financing costs incurred over the Corporation’s estimate of upfront financing costs that are payable from the proceeds of the issuance of restructuring bonds.
(17) Financing entity.— Means any servicer, trustee (or similar fiduciary), collateral or escrow agent, or other person acting for the benefit of the holders of the restructuring bonds or the Corporation that may own restructuring property or is entitled to receive proceeds from the restructuring bonds.
(18) Trustee.— Means the trustee party to a trust agreement representing the holders of the restructuring bonds issued and secured thereunder.
(19) Non-bypassable.— Means that transition charges shall be paid by all customers, even if the customer elects to purchase electricity, in whole or in part, from an alternative energy provider.
(20) Transition charge revenues.— Means any money and other property received or to be received, directly or indirectly, on account of the transition charges, and all proceeds of the investment thereof.
(21) Board.— Means the board of directors of the Corporation established pursuant to § 1064 of this title.
(22) Servicer.— Means the Authority, to the extent allowed by this chapter, and if the Authority is replaced as Servicer, in accordance with the servicing agreement or §§ 1051 et seq. of this title, it shall mean a person or persons authorized and required, by contract or otherwise, to impose, bill, or collect transition charges, to draft periodic reports on the billing and collection of transition charges, to remit collections by or on behalf of the Corporation or the assignees or creditors thereof, including a financing entity, and to render other related services to the Corporation, which may include the calculation of periodic adjustments to the transition charges or the rendering of other services related to the restructuring property; and it shall be understood to include any subservicer, backup servicer (including if it becomes a servicer under a servicing agreement), replacement servicer, or any of the successors thereof, authorized to act as such under a restructuring resolution.
(23) Adjustment mechanism.— Means the adjustment mechanism by formula as provided in a restructuring resolution, as approved in a restructuring order under the terms of §1067 of this title and § 1054x-1 of this title, to be applied by the Corporation periodically, and at least semi-annually, to adjust the transition charges and ensure the collection of transition charge revenues that are sufficient to comply with the timely payment of ongoing financing costs. The establishment and adjustment of the transition charges by the Corporation with respect to the adjustment mechanism shall not be subject to legislative or any other government review or approval, except as provided in § 1066 of this title, regarding the Commission’s review to correct the mathematical errors made by the Corporation, and § 1067(b) of this title regarding the approval of the adjustment mechanism in the restructuring order.
(24) Restructuring order.— Means the order approving the calculation methodology for the transition charges and the adjustment mechanism related thereto, as provided in this chapter. The “restructuring order” shall be irrevocable and shall not be subject to further review or amendment by the Commission.
(25) Person.— Means any natural or juridical person, including any local agency, or any individual, firm, partnership, joint venture, trust, corporation of individuals, association, public or private corporation, or municipality, organized or existing under the laws of the Commonwealth of Puerto Rico, the United States of America, or any state, any agency or instrumentality of the United States of America, or any combination thereof.
(26) Interested person.— Means
(a) the trustee representing the holders of the Authority’s outstanding bonds,
(b) the securities depository, if any, where any of such bonds shall be immobilized;
(c) any holder of the Authority’s outstanding debt obligations or any person providing credit or liquidity support, including financial guaranty insurance, to any or all of such obligations;
(d) any financial institution to which the Authority is indebted (other than through the securities depository) or otherwise obligated;
(e) the Secretary of Justice of the Commonwealth of Puerto Rico;
(f) any customer;
(g) any of the Authority’s providers of goods and services other than a customer of the Authority, as defined in this chapter;
(h) any person that has submitted to the secretary of the Board of the Corporation or to the Authority a request to receive the notice set forth in § 1067 of this title;
(i) any person that would otherwise be entitled to be notified or informed about the adjustment of the Authority’s rates and charges; and
(j) any other person interested in the matters object of the procedures provided for in § 1067 of this title.
(27) Restructuring property.— Means a restructuring resolution and the property rights and interests created thereby, including the title and right to, and the interest in:
(a) the right to create and receive transition charges;
(b) the transition charges, as adjusted from time to time in accordance with the adjustment mechanism, including any rights under a servicing agreement assigned pursuant to the corresponding trust agreement or other security agreement;
(c) all revenues, collections, claims, payments, money, or proceeds on account of the transition charges or constituting transition charges, regardless of whether such revenues, collections, claims, payments, money, or proceeds are billed, received, collected or maintained by the Authority or by the Corporation together with or commingled with other revenues, collections, claims, payments, money, or proceeds;
(d) all rights to obtain adjustments from transition charges pursuant to the terms of the restructuring resolution related thereto; and
(e) all reserves established in connection with the restructuring bonds or the restructuring property.
Once restructuring bonds are issued, the restructuring property shall constitute a vested existing property right as part of the assets of the Corporation, as initial owner, subject to any pledge of restructuring property pursuant to this chapter, notwithstanding the fact that the value of the property right shall depend on further actions that have not yet occurred, including customers remaining or becoming connected to the system assets and taking or receiving electric service, the imposition and billing of transition charges, or the rendering of services by the Authority. The term “restructuring property” shall not include the Authority’s real property or the property rights created on such personal property.
(28) Restructuring resolution.— Means a resolution of the Board of the Corporation adopted in accordance with this chapter, whereby the restructuring property is created and the imposition and collection of transition charges, as well as the approved restructuring costs, are approved through the issue of restructuring bonds. Such resolution includes the adjustment mechanism, as provided in §§ 1066 and 1067 of this title.
(29) Servicing fee.— Means the periodic amount paid to a servicer for services required in connection with the issue of restructuring bonds and the administration and servicing of restructuring property.
(30) Third-party biller.— Means any person authorized to bill or collect transition charges other than the Corporation, the Authority, or a servicer, if different from the Authority.
(31) Court.— Shall have the meaning provided in § 1067 of this title.
History —Feb. 16, 2016, No. 4, § 31.