12E.9  Authorization of the sale of rights in the master settlement agreement.

1.  Subject to the program plan as authorized by a constitutional majority of each house of the general assembly and approved by the governor, the governor shall sell and assign all or a portion of the state's share to the authority. The attorney general shall assist the governor in the preparation and review of all necessary documentation to effect such a sale by the date specified in the program plan. The terms and conditions of the sale shall be established in the program plan in order to accomplish the purpose and intent of this chapter.

2.  The sale made under this section shall be irrevocable during the time when bonds are outstanding under this chapter, and shall be a part of the contractual obligation owed to the bondholders. The sale shall constitute and be treated as a true sale and absolute transfer of the property so transferred and not as a pledge or other security interest for any borrowing. The characterization of such a sale as an absolute transfer shall not be negated or adversely affected by the fact that only a portion of the state's share is being sold, or by the state's acquisition or retention of an ownership interest in the residual assets.

3.  On or after the effective date of such sale, the state shall not have any right, title, or interest in the portion of the master settlement agreement sold and such portion shall be the property of the authority and not the state, and shall be owned, received, held, and disbursed by the authority or its trustee or assignee, and not the state.

4.  On or before the effective date of the sale, the state shall notify the escrow agent under the master settlement agreement of the sale and shall instruct the escrow agent that subsequent to that date, all payments constituting the portion sold shall be made directly to the authority.

5.  The authority, the treasurer of state, and the attorney general shall report to the legislative council and the executive council on or before the date specified in the program plan, advising them of the accomplishment of the sale, its terms, and conditions.

Section History: Recent form

  2000 Acts, ch 1208, §9, 25

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