Sec. 15. (a) A valid and enforceable lien and security interest in securitization property may be created only by a financing order and the execution and delivery of a security agreement with a financing entity in connection with the issuance of securitization bonds.

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Terms Used In Indiana Code 8-1-40.5-15

  • assignee: means any individual, corporation, or other legally recognized entity to which an interest in securitization property is transferred. See Indiana Code 8-1-40.5-1
  • Attachment: A procedure by which a person's property is seized to pay judgments levied by the court.
  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • commission: refers to the Indiana utility regulatory commission created by IC 8-1-1-2. See Indiana Code 8-1-40.5-2
  • Dependent: A person dependent for support upon another.
  • electric utility: means a public utility (as defined in IC 8-1-2-1(a)) that meets the following criteria:

    Indiana Code 8-1-40.5-3

  • financing order: means an order issued by the commission under section 10 of this chapter. See Indiana Code 8-1-40.5-4
  • financing party: means a holder of securitization bonds. See Indiana Code 8-1-40.5-5
  • Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Property: includes personal and real property. See Indiana Code 1-1-4-5
  • securitization bonds: means bonds, debentures, notes, certificates of participation, certificates of a beneficial interest, certificates of ownership, or other evidences of indebtedness that:

    Indiana Code 8-1-40.5-7

  • securitization charges: means nonbypassable amounts that are:

    Indiana Code 8-1-40.5-8

  • securitization property: means the rights and interests of an electric utility, or its successor, under a financing order, as described in section 11 of this chapter. See Indiana Code 8-1-40.5-9
     (b) The lien and security interest attach automatically from the time that value is received for the securitization bonds, and:

(1) constitute a continuously perfected lien and security interest in the securitization property and all proceeds of the property, whether or not accrued;

(2) have priority in the order of their filing, if a financing statement is filed with respect to the security interest in accordance with IC 26-1; and

(3) take precedence over any subsequent:

(A) judicial lien; or

(B) other creditor’s lien.

In addition to the rights and remedies provided by this chapter, all rights and remedies provided by IC 26-1 with respect to a security interest apply with respect to securitization property.

     (c) Transfer of an interest in securitization property to an assignee is perfected against all third parties, including subsequent judicial or other lien creditors, if a financing statement is filed with respect to the transfer in accordance with IC 26-1.

     (d) The priority of a lien and security interest under this section is not impaired by the following:

(1) A later modification of the financing order under which the securitization property arises.

(2) The commingling of other funds with funds arising from the collection of securitization charges. Any other security interest that may apply to funds arising from the collection of securitization charges terminates when the funds are transferred to a segregated account for the benefit of the assignee or a financing entity. If securitization property has been transferred to an assignee, any proceeds from that property shall be held in trust for the assignee.

     (e) If the electric utility or any of its successors default in paying revenues arising with respect to the securitization property, the commission or a court having jurisdiction shall, upon application of the financing party, and without limiting any other remedies available to the financing party, order the:

(1) sequestration; and

(2) payment to the financing party;

of revenues arising with respect to the securitization property. An order under this subsection remains in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor or any pledger or transferor of the securitization property.

     (f) Securitization property constitutes an account as defined in IC 26-1-9.1-102.

     (g) For purposes of this chapter and IC 26-1, securitization property is considered to exist regardless of whether:

(1) the revenue or proceeds with respect to the property have accrued; or

(2) the value of the property right is dependent on the customers of an electric utility receiving service.

     (h) Changes in a financing order or in customers’ securitization charges do not affect the validity, perfection, or priority of the security interest in the related securitization property.

     (i) The description of securitization property in a security agreement, in another agreement, or in a financing statement is sufficient if it refers to this chapter and the financing order under which the securitization property arises.

     (j) This chapter controls in any conflict between this chapter and any other Indiana law regarding:

(1) the attachment and perfection;

(2) the effect of perfection; and

(3) the priority;

of any security interest in securitization property.

As added by P.L.80-2021, SEC.1.

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