A. Any sale, assignment or transfer of energy transition property to an assignee that is a financing entity that is wholly owned, directly or indirectly, by the utility shall be an absolute transfer and true sale of, and not a pledge of or secured transaction relating to, the seller's right, title and interest in, to and under the energy transition property if the documents governing the transaction expressly state that the transaction is a sale or other absolute transfer. A transfer of an interest in energy transition property shall be created when:
(1) the financing order creating the energy transition property has become effective;
(2) the documents evidencing the transfer of energy transition property have been executed and delivered to the assignee; and
(3) value is received.
B. On the filing of a financing statement with the secretary of state pursuant to Subsection D of Section 13 [62-18-13 NMSA 1978] of the Energy Transition Act, a transfer of an interest in energy transition property shall be perfected against all third persons, except creditors holding a prior security interest, ownership interest or assignment in the energy transition property previously perfected in accordance with Section 13 of that act.
C. The characterization of the sale, assignment or transfer as an absolute transfer and true sale, and the corresponding characterization of the property interest of the purchaser, shall not be affected or impaired by:
(1) commingling of energy transition revenues with other funds;
(2) the retention by the seller of:
(a) a partial or residual interest, including an equity interest, in the energy transition property, whether direct or indirect, or whether subordinate or otherwise; or
(b) the right to recover costs associated with taxes or license fees imposed on the collection of energy transition revenues;
(3) any recourse that the purchaser may have against the seller;
(4) any indemnification rights, obligations or repurchase rights made or provided by the seller;
(5) the obligation of the seller to collect energy transition revenues on behalf of an assignee;
(6) the treatment of the sale, assignment or transfer of energy transition property for tax, financial reporting or other purposes;
(7) any subsequent order of the commission amending a financing order pursuant to Subsection B of Section 7 [62-18-7 NMSA 1978] of the Energy Transition Act;
(8) any use of an adjustment mechanism approved in the financing order; or
(9) anything else that might affect or impair the characterization of the property.
History: Laws 2019, ch. 65, § 14.
ANNOTATIONSEffective dates. — Laws 2019, ch. 65 contained no effective date provision, but, pursuant to N.M. Const., art. IV, § 23, was effective June 14, 2019, 90 days after the adjournment of the legislature.