Exhibit 10.26
[MASTER FUND LOAN AGREEMENT FOR MIDDLESEX WATER COMPANY - PRIVATE FORM]
LOAN AGREEMENT
BY AND BETWEEN
THE STATE OF NEW JERSEY,
ACTING BY AND THROUGH THE NEW JERSEY
DEPARTMENT OF ENVIRONMENTAL PROTECTION,
AND
MIDDLESEX WATER COMPANY
DATED AS OF NOVEMBER 1, 2004
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions......................................................
ARTICLE II
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REPRESENTATIONS AND COVENANTS OF BORROWER
SECTION 2.01. Representations of Borrower......................................
SECTION 2.02. Particular Covenants of Borrower.................................
ARTICLE III
LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS
SECTION 3.01. Loan; Loan Term..................................................
SECTION 3.02. Disbursement of Loan Proceeds....................................
SECTION 3.03. Amounts Payable..................................................
SECTION 3.04. Unconditional Obligations........................................
SECTION 3.05. Loan Agreement to Survive Bond Resolution and Trust Bonds........
SECTION 3.06. Disclaimer of Warranties and Indemnification.....................
SECTION 3.07. Option to Prepay Loan Repayments.................................
SECTION 3.08. Priority of Loan and Fund Loan...................................
SECTION 3.09. Approval of the New Jersey State Treasurer.......................
ARTICLE IV
ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND
SECTION 4.01. Assignment and Transfer by Trust.................................
SECTION 4.02. Assignment by Borrower...........................................
ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
SECTION 5.01. Events of Default................................................
SECTION 5.02. Notice of Default................................................
SECTION 5.03. Remedies on Default..............................................
SECTION 5.04. Attorneys' Fees and Other Expenses...............................
SECTION 5.05. Application of Moneys............................................
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SECTION 5.06. No Remedy Exclusive; Waiver; Notice..............................
SECTION 5.07. Retention of Trust's Rights......................................
ARTICLE VI
MISCELLANEOUS
SECTION 6.01. Notices..........................................................
SECTION 6.02. Binding Effect...................................................
SECTION 6.03. Severability.....................................................
SECTION 6.04. Amendments, Supplements and Modifications........................
SECTION 6.05. Execution in Counterparts........................................
SECTION 6.06. Applicable Law and Regulations...................................
SECTION 6.07. Consents and Approvals...........................................
SECTION 6.08. Captions.........................................................
SECTION 6.09. Benefit of Loan Agreement; Compliance with Bond Resolution.......
SECTION 6.10. Further Assurances...............................................
SCHEDULE A.Certain Additional Loan Agreement Provisions
EXHIBIT A (1) Description of Project and Environmental Infrastructure
System.....................................................A-1-1
(2) Description of Loan........................................A-2-1
EXHIBIT B Basis for Determination of Allowable Project Costs...............B-1
EXHIBIT C Estimated Disbursement Schedule..................................C-1
EXHIBIT D Specimen Borrower Bond...........................................D-1
EXHIBIT E Opinions of Borrower's Bond and General Counsels.................E-1
EXHIBIT F Additional Covenants and Requirements............................F-1
EXHIBIT G General Administrative Requirements for the State
Environmental Infrastructure Financing Program.................G-1
EXHIBIT H Form of Continuing Disclosure Agreement..........................H-1
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NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE FUND LOAN AGREEMENT
THIS LOAN AGREEMENT, made and entered into as of November 1, 2003, by and
between THE STATE OF NEW JERSEY, acting by and through the New Jersey Department
of Environmental Protection, and the Borrower (capitalized terms used in this
Loan Agreement shall have, unless the context otherwise requires, the meanings
ascribed thereto in Section 1.01 hereof);
WITNESSETH THAT:
WHEREAS, the Borrower has, in accordance with the Regulations, made timely
application to the State for a Loan to finance a portion of the Cost of the
Project;
WHEREAS, the State has approved the Borrower's application for a Loan from
Federal Funds, if and when received by and available to the State, and moneys
from repayments of loans previously made from such Federal Funds, in the amount
of the loan commitment set forth in Exhibit A-2 attached hereto and made a part
hereof to finance a portion of the Cost of the Project;
WHEREAS, the New Jersey State Legislature has approved an appropriations
act that authorizes an expenditure of said proceeds, Federal Funds or related
moneys to finance a portion of the Cost of the Project;
WHEREAS, the Borrower, in accordance with the Business Corporation Law and
all other applicable law, will issue a Borrower Bond to the State evidencing
said Loan at the Loan Closing; and
WHEREAS, in accordance with the New Jersey Environmental Infrastructure
Trust Act, P.L. 1985, c. 334, as amended, and the Regulations, the Borrower has
been awarded a Trust Loan for a portion of the Cost of the Project plus, if
applicable to the Borrower, capitalized interest on the Trust Loan, certain
costs of issuance and bond insurance premium related thereto.
NOW, THEREFORE, for and in consideration of the award of the Loan by the
State, the Borrower agrees to complete the Project and to perform under this
Loan Agreement in accordance with the conditions, covenants and procedures set
forth herein and attached hereto as part hereof, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms as used in this Loan
Agreement shall, unless the context clearly requires otherwise, have the
following meanings:
"Administrative Fee" means an annual fee of up to one percent (1.0%) of
the initial principal amount of the Loan or such lesser amount, if any, as may
be authorized by any act of the New Jersey State Legislature and as the State
may approve from time to time.
"Authorized Officer" means, in the case of the Borrower, any person or
persons authorized pursuant to a resolution of the board of directors of the
Borrower to perform any act or execute any document relating to the Loan, the
Borrower Bond or this Loan Agreement.
"Borrower" means the corporation that is a party to and is described in
Schedule A to this Loan Agreement, and its successors and assigns.
"Borrower Bond" means the general obligation bond, note, debenture or
other evidence of indebtedness authorized, executed, attested and delivered by
the Borrower to the State and authenticated, if applicable, on behalf of the
Borrower to evidence the Loan, a specimen of which is attached hereto as Exhibit
D and made a part hereof.
"Borrowers" means any other Local Government Unit or Private Entity (as
such terms are defined in the Regulations) authorized to construct, operate and
maintain Environmental Infrastructure Facilities that have entered into Loan
Agreements with the State pursuant to which the State will make Loans to such
recipients from Federal Funds.
"Business Corporation Law" means the "New Jersey Business Corporation
Act", constituting Chapter 263 of the Pamphlet Laws of 1968 of the State
(codified at N.J.S.A. 14A:1-1 et seq.), as the same may from time to time be
amended and supplemented.
"Code" means the Internal Revenue Code of 1986, as the same may from time
to time be amended and supplemented, including any regulations promulgated
thereunder, any successor code thereto and any administrative or judicial
interpretations thereof.
"Cost" means those costs that are eligible, reasonable, necessary,
allocable to the Project and permitted by generally accepted accounting
principles, including Allowances and Building Costs (as defined in the
Regulations), as shall be determined on a project-specific basis in accordance
with the Regulations as set forth in Exhibit B hereto, as the same may be
amended by subsequent eligible costs as evidenced by a certificate of an
authorized officer of the State.
"Environmental Infrastructure Facilities" means Water Supply Facilities
(as such term is defined in the Regulations).
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"Environmental Infrastructure System" means the Environmental
Infrastructure Facilities of the Borrower, including the Project, described in
Exhibit A-1 attached hereto and made a part hereof for which the Borrower is
borrowing the Loan under this Loan Agreement.
"Event of Default" means any occurrence or event specified in Section 5.01
hereof.
"Federal Funds" means those funds awarded to the State pursuant to the
Clean Water Act (33 U.S.C. ss.1251 et seq.) or the Safe Drinking Water Act (42
U.S.C. ss.300f et seq.), as the same may from time to time be amended and
supplemented.
"Loan" means the loan made by the State to the Borrower to finance or
refinance a portion of the Cost of the Project pursuant to this Loan Agreement.
For all purposes of this Loan Agreement, the principal amount of the Loan at any
time shall be the amount of the loan commitment set forth in Exhibit A-2
attached hereto and made a part hereof (such amount being also specified as the
initial aggregate principal amount of the Borrower Bond) less any amount of such
principal amount that has been repaid by the Borrower under this Loan Agreement
and less any adjustment made for low bid or final building costs pursuant to the
provisions of N.J.A.C. 7:22-3.26 and the appropriations act of the New Jersey
State Legislature authorizing the expenditure of moneys to finance a portion of
the Cost of the Project.
"Loan Agreement" means this Loan Agreement, including the Exhibits
attached hereto, as it may be supplemented, modified or amended from time to
time in accordance with the terms hereof.
"Loan Agreements" means any other loan agreements entered into by and
between the State and one or more of the Borrowers pursuant to which the State
will make Loans to such Borrowers from Federal Funds.
"Loan Closing" means the date upon which the Borrower shall deliver its
Borrower Bond, as previously authorized, executed, attested and, if applicable,
authenticated, to the State.
"Loan Repayments" means the sum of (i) the repayments of the principal
amount of the Loan payable by the Borrower pursuant to Section 3.03(a) of this
Loan Agreement and (ii) any late charges incurred hereunder, but shall not
include the Administrative Fee.
"Loan Term" means the term of this Loan Agreement provided in Sections
3.01 and 3.03 hereof and in Exhibit A-2 attached hereto and made a part hereof.
"Loans" means the loans made by the State to the Borrowers under the Loan
Agreements from Federal Funds.
"Master Program Trust Agreement" means that certain Master Program Trust
Agreement, dated as of November 1, 1995, by and among the Trust, the State,
United States Trust Company of New York, as Master Program Trustee thereunder,
The Bank of New York (NJ), in several capacities thereunder, and First Fidelity
Bank, N.A. (predecessor to Wachovia Bank, National Association), in several
capacities thereunder, as supplemented by that certain
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Agreement of Resignation of Outgoing Master Program Trustee, Appointment of
Successor Master Program Trustee and Acceptance Agreement, dated as of November
1, 2001, by and among United States Trust Company of New York, as Outgoing
Master Program Trustee, State Street Bank and Trust Company, N.A. (predecessor
to U.S. Bank Trust National Association), as Successor Master Program Trustee,
and the Trust, as the same may be amended and supplemented from time to time in
accordance with its terms.
"Prime Rate" means the prevailing commercial interest rate announced by
the Trustee from time to time in the State as its prime lending rate.
"Project" means the Environmental Infrastructure Facilities of the
Borrower described in Exhibit A-1 attached hereto and made a part hereof, which
constitutes a project for which the State is permitted to make a loan to the
Borrower pursuant to the Regulations, all or a portion of the Cost of which is
financed or refinanced by the State through the making of the Loan under this
Loan Agreement and which may be identified under either the Drinking Water or
Clean Water Project Lists with the Project Number specified in Exhibit A-1
attached hereto.
"Regulations" means the rules and regulations, as applicable, now or
hereafter promulgated under N.J.A.C. 7:22-3 et seq., 7:22-4 et seq., 7:22-5 et
seq., 7:22-9 et seq. and 7:22-10 et seq., as the same may from time to time be
amended and supplemented.
"State" means the State of New Jersey, acting, unless otherwise
specifically indicated, by and through the New Jersey Department of
Environmental Protection, and its successors and assigns.
"Trust" means the New Jersey Environmental Infrastructure Trust, a public
body corporate and politic with corporate succession duly created and validly
existing under and by virtue of P.L. 1985, c. 334, as amended (N.J.S.A. 58:11B-1
et seq.).
"Trust Loan" means the loan made to the Borrower by the Trust pursuant to
the Trust Loan Agreement.
"Trust Loan Agreement" means the loan agreement by and between the
Borrower and the Trust dated as of November 1, 2003 to finance or refinance a
portion of the Cost of the Project.
"Trustee" means, initially, Wachovia Bank, National Association, the
Trustee appointed by the Trust and its successors as Trustee under the Bond
Resolution, as provided in Article X of the Bond Resolution.
(b) In addition to the capitalized terms defined in subsection (a) of this
Section 1.01, certain additional capitalized terms used in this Loan Agreement
shall, unless the context clearly requires otherwise, have the meanings ascribed
to such additional capitalized terms in Schedule A attached hereto and made a
part hereof.
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(c) Except as otherwise defined herein or where the context otherwise
requires, words importing the singular number shall include the plural number
and vice versa, and words importing persons shall include firms, associations,
corporations, agencies and districts. Words importing one gender shall include
the other gender.
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ARTICLE II
REPRESENTATIONS AND COVENANTS OF BORROWER
SECTION 2.01. Representations of Borrower. The Borrower represents for the
benefit of the State as follows:
(a) Organization and Authority.
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(i) The Borrower is a corporation duly created and validly existing
under and pursuant to the laws of the State, including the Business
Corporation Law.
(ii) The acting officers of the Borrower who are contemporaneously
herewith performing or have previously performed any action contemplated
in this Loan Agreement either are or, at the time any such action was
performed, were the duly appointed or elected officers of such Borrower
empowered by applicable New Jersey law and, if applicable, authorized by
resolution of the Borrower to perform such actions. To the extent any such
action was performed by an officer no longer the duly acting officer of
such Borrower, all such actions previously taken by such officer are still
in full force and effect.
(iii) The Borrower has full legal right and authority and all
necessary licenses and permits required as of the date hereof to own,
operate and maintain its Environmental Infrastructure System, to carry on
its activities relating thereto, to execute, attest and deliver this Loan
Agreement and the Borrower Bond, to authorize the authentication of the
Borrower Bond, to sell the Borrower Bond to the State, to undertake and
complete the Project and to carry out and consummate all transactions
contemplated by this Loan Agreement.
(iv) The proceedings of the Borrower's board of directors approving
this Loan Agreement and the Borrower Bond, authorizing the execution,
attestation and delivery of this Loan Agreement and the Borrower Bond,
authorizing the sale of the Borrower Bond to the State, authorizing the
authentication of the Borrower Bond on behalf of the Borrower and
authorizing the Borrower to undertake and complete the Project, including,
without limitation, the Borrower Bond Resolution (collectively, the
"Proceedings"), have been duly and lawfully adopted in accordance with the
Business Corporation Law and other applicable New Jersey law at a meeting
or meetings that were duly called and held in accordance with the Borrower
By-Laws and at which quorums were present and acting throughout.
(v) By official action of the Borrower taken prior to or concurrent
with the execution and delivery hereof, including, without limitation, the
Proceedings, the Borrower has duly authorized, approved and consented to
all necessary action to be taken by the Borrower for: (A) the execution,
attestation, delivery and performance of this Loan Agreement and the
transactions contemplated hereby; (B) the issuance of the Borrower Bond
and the sale thereof to the State upon the terms set forth herein; and (C)
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the execution, delivery and due performance of any and all other
certificates, agreements and instruments that may be required to be
executed, delivered and performed by the Borrower in order to carry out,
give effect to and consummate the transactions contemplated by this Loan
Agreement.
(vi) This Loan Agreement and the Borrower Bond have each been duly
authorized by the Borrower and duly executed, attested and delivered by
Authorized Officers of the Borrower, and the Borrower Bond has been duly
sold by the Borrower to the State, duly authenticated by the trustee or
paying agent, if applicable, under the Borrower Bond Resolution and duly
issued by the Borrower in accordance with the terms of the Borrower Bond
Resolution; and assuming that the State has all the requisite power and
authority to authorize, execute, attest and deliver, and has duly
authorized, executed, attested and delivered, this Loan Agreement, and
assuming further that this Loan Agreement is the legal, valid and binding
obligation of the State, enforceable against the State in accordance with
its terms, each of this Loan Agreement and the Borrower Bond constitutes a
legal, valid and binding obligation of the Borrower, enforceable against
the Borrower in accordance with its respective terms, except as the
enforcement thereof may be affected by bankruptcy, insolvency or other
laws or the application by a court of legal or equitable principles
affecting creditors' rights; and the information contained under
"Description of Loan" in Exhibit A-2 attached hereto and made a part
hereof is true and accurate in all respects.
(b) Full Disclosure. There is no fact that the Borrower has not disclosed
to the State in writing on the Borrower's application for the Loan or otherwise
that materially adversely affects or (so far as the Borrower can now foresee)
that will materially adversely affect the properties, activities, prospects or
condition (financial or otherwise) of the Borrower or its Environmental
Infrastructure System, or the ability of the Borrower to make all Loan
Repayments or otherwise to observe and perform its duties, covenants,
obligations and agreements under this Loan Agreement and the Borrower Bond.
(c) Pending Litigation. There are no proceedings pending or, to the
knowledge of the Borrower, threatened against or affecting the Borrower in any
court or before any governmental authority or arbitration board or tribunal
that, if adversely determined, would materially adversely affect (i) the
undertaking or completion of the Project, (ii) the properties, activities,
prospects or condition (financial or otherwise) of the Borrower or its
Environmental Infrastructure System, (iii) the ability of the Borrower to make
all Loan Repayments, (iv) the authorization, execution, attestation or delivery
of this Loan Agreement or the Borrower Bond, (v) the issuance of the Borrower
Bond and the sale thereof to the State, (vi) the adoption of the Borrower Bond
Resolution, or (vii) the Borrower's ability otherwise to observe and perform its
duties, covenants, obligations and agreements under this Loan Agreement and the
Borrower Bond, which proceedings have not been previously disclosed in writing
to the State either in the Borrower's application for the Loan or otherwise.
(d) Compliance with Existing Laws and Agreements. (i) The authorization,
execution, attestation and delivery of this Loan Agreement and the Borrower Bond
by the Borrower, (ii) the authentication of the Borrower Bond by the trustee or
paying agent under the
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Borrower Bond Resolution, as the case may be, and the sale of the Borrower Bond
to the State, (iii) the adoption of the Borrower Bond Resolution, (iv) the
observation and performance by the Borrower of its duties, covenants,
obligations and agreements hereunder and thereunder, (v) the consummation of the
transactions provided for in this Loan Agreement, the Borrower Bond Resolution
and the Borrower Bond, and (vi) the undertaking and completion of the Project
will not (A) other than the lien, charge or encumbrance created hereby, by the
Borrower Bond, by the Borrower Bond Resolution and by any other outstanding debt
obligations of the Borrower that are at parity with the Borrower Bond as to lien
on, and source and security for payment thereon from, the revenues of the
Borrower's Environmental Infrastructure System, result in the creation or
imposition of any lien, charge or encumbrance upon any properties or assets of
the Borrower pursuant to, (B) result in any breach of any of the terms,
conditions or provisions of, or (C) constitute a default under, any existing
resolution, outstanding debt or lease obligation, trust agreement, indenture,
mortgage, deed of trust, loan agreement or other instrument to which the
Borrower is a party or by which the Borrower, its Environmental Infrastructure
System or any of its properties or assets may be bound, nor will such action
result in any violation of the provisions of the charter or other document
pursuant to which the Borrower was established or any laws, ordinances,
injunctions, judgments, decrees, rules, regulations or existing orders of any
court or governmental or administrative agency, authority or person to which the
Borrower, its Environmental Infrastructure System or its properties or
operations is subject.
(e) No Defaults. No event has occurred and no condition exists that, upon
the authorization, execution, attestation and delivery of this Loan Agreement
and the Borrower Bond, the issuance of the Borrower Bond and the sale thereof to
the State, the adoption of the Borrower Bond Resolution or the receipt of the
amount of the Loan, would constitute an Event of Default hereunder. The Borrower
is not in violation of, and has not received notice of any claimed violation of,
any term of any agreement or other instrument to which it is a party or by which
it, its Environmental Infrastructure System or its properties may be bound,
which violation would materially adversely affect the properties, activities,
prospects or condition (financial or otherwise) of the Borrower or its
Environmental Infrastructure System or the ability of the Borrower to make all
Loan Repayments, to pay all other amounts due hereunder or otherwise to observe
and perform its duties, covenants, obligations and agreements under this Loan
Agreement and the Borrower Bond.
(f) Governmental Consent. The Borrower has obtained all permits and
approvals required to date by any governmental body or officer for the
authorization, execution, attestation and delivery of this Loan Agreement and
the Borrower Bond, for the issuance of the Borrower Bond and the sale thereof to
the State, for the adoption of the Borrower Bond Resolution, for the making,
observance and performance by the Borrower of its duties, covenants, obligations
and agreements under this Loan Agreement and the Borrower Bond and for the
undertaking or completion of the Project and the financing or refinancing
thereof, including, but not limited to, if required, the approval by the New
Jersey Board of Public Utilities (the "BPU") of the issuance by the Borrower of
the Borrower Bond to the State and any other approvals required therefor by the
BPU; and the Borrower has complied with all applicable provisions of law
requiring any notification, declaration, filing or registration with any
governmental body or officer in connection with the making, observance and
performance by the Borrower of its duties, covenants, obligations and agreements
under this Loan Agreement and the Borrower Bond or
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with the undertaking or completion of the Project and the financing or
refinancing thereof. No consent, approval or authorization of, or filing,
registration or qualification with, any governmental body or officer that has
not been obtained is required on the part of the Borrower as a condition to the
authorization, execution, attestation and delivery of this Loan Agreement and
the Borrower Bond, the issuance of the Borrower Bond and the sale thereof to the
State, the undertaking or completion of the Project or the consummation of any
transaction herein contemplated.
(g) Compliance with Law. The Borrower:
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(i) is in compliance with all laws, ordinances, governmental rules
and regulations to which it is subject, the failure to comply with which
would materially adversely affect (A) the ability of the Borrower to
conduct its activities or to undertake or complete the Project, (B) the
ability of the Borrower to make the Loan Repayments and to pay all other
amounts due hereunder, or (C) the condition (financial or otherwise) of
the Borrower or its Environmental Infrastructure System; and
(ii) has obtained all licenses, permits, franchises or other
governmental authorizations presently necessary for the ownership of its
properties or for the conduct of its activities that, if not obtained,
would materially adversely affect (A) the ability of the Borrower to
conduct its activities or to undertake or complete the Project, (B) the
ability of the Borrower to make the Loan Repayments and to pay all other
amounts due hereunder, or (C) the condition (financial or otherwise) of
the Borrower or its Environmental Infrastructure System.
(h) Use of Proceeds. The Borrower will apply the proceeds of the Loan from
the State as described in Exhibit B attached hereto and made a part hereof (i)
to finance or refinance a portion of the Cost of the Borrower's Project; and
(ii) where applicable, to reimburse the Borrower for a portion of the Cost of
the Borrower's Project, which portion was paid or incurred in anticipation of
reimbursement by the State and is eligible for such reimbursement under and
pursuant to the Regulations, the Code and any other applicable law. All of such
costs constitute Costs for which the State is authorized to make Loans to the
Borrower pursuant to the Regulations.
SECTION 2.02. Particular Covenants of Borrower.
(a) Promise to Pay. The Borrower unconditionally promises, in accordance
with the terms of and to the extent provided in the Borrower Bond Resolution, to
make punctual payment of the principal of the Loan and the Borrower Bond and all
other amounts due under this Loan Agreement and the Borrower Bond according to
their respective terms.
(b) Performance Under Loan Agreement; Rates. The Borrower covenants and
agrees (i) to comply with all applicable State and federal laws, rules and
regulations in the performance of this Loan Agreement; (ii) to maintain its
Environmental Infrastructure System in good repair and operating condition;
(iii) to cooperate with the State in the observance and performance of the
respective duties, covenants, obligations and agreements of the Borrower and the
State under
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this Loan Agreement; and (iv) to establish, levy and collect rents, rates and
other charges for the products and services provided by its Environmental
Infrastructure System, which rents, rates and other charges shall be at least
sufficient to comply with all covenants pertaining thereto contained in, and all
other provisions of, any bond resolution, trust indenture or other security
agreement, if any, relating to any bonds, notes or other evidences of
indebtedness issued or to be issued by the Borrower, including without
limitation rents, rates and other charges, together with other available moneys,
sufficient to pay the principal of and Interest on the Borrower Bond, plus all
other amounts due hereunder.
(c) Revenue Obligation; No Prior Pledges. The Borrower shall not be
required to make payments under this Loan Agreement except from the revenues of
its Environmental Infrastructure System and from such other funds of such
Environmental Infrastructure System legally available therefor and from any
other sources pledged to such payment pursuant to subsection (a) of this Section
2.02. In no event shall the Borrower be required to make payments under this
Loan Agreement from any revenues or receipts not derived from its Environmental
Infrastructure System or pledged pursuant to subsection (a) of this Section
2.02. Except for (i) loan repayments required with respect to the Trust Loan,
(ii) the debt service on any future bonds or notes of the Borrower issued at
parity with the Borrower Bond under the Borrower Bond Resolution, and (iii) the
debt service on any bonds, notes or evidences of indebtedness of the Borrower at
parity with the Borrower Bond under the Borrower Bond Resolution and currently
outstanding or issued on the date hereof, the revenues derived by the Borrower
from its Environmental Infrastructure System, after the payment of all costs of
operating and maintaining the Environmental Infrastructure System, are and will
be free and clear of any pledge, lien, charge or encumbrance thereon or with
respect thereto prior to, or of equal rank with, the obligation of the Borrower
to make Loan Repayments under this Loan Agreement and the Borrower Bond, and all
corporate or other action on the part of the Borrower to that end has been and
will be duly and validly taken.
(d) Completion of Project and Provision of Moneys Therefor. The Borrower
covenants and agrees (i) to exercise its best efforts in accordance with prudent
environmental infrastructure utility practice to complete the Project and to
accomplish such completion on or before the estimated Project completion date
set forth in Exhibit G hereto and made a part hereof; (ii) to comply with the
terms and provisions contained in Exhibit G hereto; and (iii) to provide from
its own fiscal resources all moneys, in excess of the total amount of loan
proceeds it receives under the Loan and Trust Loan, required to complete the
Project.
(e) See Section 2.02(e) as set forth in Schedule A attached hereto, made a
part hereof and incorporated in this Section 2.02(e) by reference as if set
forth in full herein.
(f) Reserved.
(g) Operation and Maintenance of Environmental Infrastructure System. The
Borrower covenants and agrees that it shall, in accordance with prudent
environmental infrastructure utility practice, (i) at all times operate the
properties of its Environmental Infrastructure System and any business in
connection therewith in an efficient manner, (ii) maintain its Environmental
Infrastructure System in good repair, working order and operating
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condition, and (iii) from time to time make all necessary and proper repairs,
renewals, replacements, additions, betterments and improvements with respect to
its Environmental Infrastructure System so that at all times the business
carried on in connection therewith shall be properly and advantageously
conducted.
(h) Records and Accounts. The Borrower shall keep accurate records and
accounts for its Environmental Infrastructure System specifically relating to
the project (the "System Records") separate and distinct from its other records
and accounts (the "General Records"). Such System Records shall be audited
annually by an independent certified public accountant, which may be part of the
annual audit of the General Records of the Borrower. Such System Records and
General Records shall be made available for inspection by the State at any
reasonable time upon prior written notice, and a copy of such annual audit(s)
therefor, including all written comments and recommendations of such accountant,
shall be furnished to the State within 150 days of the close of the fiscal year
being so audited or, with the consent of the State, such additional period as
may be provided by law.
(i) Inspections; Information. The Borrower shall permit the State and any
party designated by the State, at any and all reasonable times during
construction of the Project and thereafter upon prior written notice, to
examine, visit and inspect the property, if any, constituting the Project and to
inspect and make copies of any accounts, books and records, including (without
limitation) its records regarding receipts, disbursements, contracts,
investments and any other matters relating thereto and to its financial
standing, and shall supply such reports and information as the State may
reasonably require in connection therewith.
(j) Insurance. The Borrower shall maintain or cause to be maintained, in
force, insurance policies with responsible insurers or self-insurance programs
providing against risk of direct physical loss, damage or destruction of its
Environmental Infrastructure System at least to the extent that similar
insurance is usually carried by utilities constructing, operating and
maintaining Environmental Infrastructure Facilities of the nature of the
Borrower's Environmental Infrastructure System, including liability coverage,
all to the extent available at reasonable cost but in no case less than will
satisfy all applicable regulatory requirements.
(k) Cost of Project. The Borrower certifies that the building cost of the
Project, as listed in Exhibit B hereto and made a part hereof, is a reasonable
and accurate estimation thereof, and it will supply to the State a certificate
from a licensed professional engineer authorized to practice in the State
stating that such building cost is a reasonable and accurate estimation and that
the useful life of the Project exceeds the maturity date of the Borrower Bond.
(l) Delivery of Documents. Concurrently with the delivery of this Loan
Agreement (as previously authorized, executed and attested) at the Loan Closing,
the Borrower will cause to be delivered to the State each of the following
items:
(i) an opinion of the Borrower's bond counsel substantially in the
form of Exhibit E hereto; provided, however, that the State may permit
portions of such opinion to be rendered by general counsel to the Borrower
and may permit variances in such opinion from the form set forth in
Exhibit E if such variances are acceptable to the State;
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(ii) counterparts of this Loan Agreement as previously executed and
attested by the parties hereto;
(iii) copies of those resolutions finally adopted by the board of
directors of the Borrower and requested by the State, including, without
limitation, (A) the resolution of the Borrower authorizing the execution,
attestation and delivery of this Loan Agreement, (B) the Borrower Bond
Resolution, as amended and supplemented as of the date of the Loan
Closing, authorizing the execution, attestation, authentication, sale and
delivery of the Borrower Bond to the State, (C) the resolution of the
Borrower confirming the details of the sale of the Borrower Bond to the
State, each of said resolutions of the Borrower being certified by an
Authorized Officer of the Borrower as of the date of the Loan Closing, (D)
the resolution of the BPU approving the issuance by the Borrower of the
Borrower Bond to the State and setting forth any other approvals required
therefor by the BPU, if applicable, and (E) any other Proceedings; and
(iv) the certificates of insurance coverage as required pursuant to
the terms of Section 3.06(c) hereof and such other certificates,
documents, opinions and information as the State may require in Exhibit F
hereto, if any.
(m) Execution and Delivery of Borrower Bond. Concurrently with the
delivery of this Loan Agreement at the Loan Closing, the Borrower shall also
deliver to the State the Borrower Bond, as previously executed, attested and, if
applicable, authenticated.
(n) Notice of Material Adverse Change. The Borrower shall promptly notify
the State of any material adverse change in the properties, activities,
prospects or condition (financial or otherwise) of the Borrower or its
Environmental Infrastructure System, or in the ability of the Borrower to make
all Loan Repayments and otherwise to observe and perform its duties, covenants,
obligations and agreements under this Loan Agreement and the Borrower Bond.
(o) Continuing Representations. The representations of the Borrower
contained herein shall be true at the time of the execution of this Loan
Agreement and at all times during the term of this Loan Agreement.
(p) Additional Covenants and Requirements. (i) No later than the Loan
Closing and, if necessary, in connection with the making of the Loan, additional
covenants and requirements have been included in Exhibit F hereto and made a
part hereof. Such covenants and requirements may include, but need not be
limited to, the maintenance of specified levels of Environmental Infrastructure
System rates, the issuance of additional debt of the Borrower and the transfer
of revenues and receipts from the Borrower's Environmental Infrastructure
System. The Borrower agrees to observe and comply with each such additional
covenant and requirement, if any, included in Exhibit F hereto. (ii) Additional
defined terms, covenants, representations and requirements have been included in
Schedule A attached hereto and made a part hereof. Such additional defined
terms, covenants, representations and requirements are incorporated in this Loan
Agreement by reference thereto as if set forth in full herein and the
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Borrower hereby agrees to observe and comply with each such additional term,
covenant, representation and requirement included in Schedule A as if the same
were set forth in its entirety where reference thereto is made in this Loan
Agreement.
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ARTICLE III
LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS
SECTION 3.01. Loan; Loan Term. The State hereby agrees to make the Loan as
described in Exhibit A-2 hereof and to disburse proceeds of the Loan to the
Borrower in accordance with Section 3.02 and Exhibit C hereof, and the Borrower
hereby agrees to borrow and accept the Loan from the State upon the terms set
forth in Exhibit A-2 attached hereto and made a part hereof; provided, however,
that the State shall be under no obligation to make the Loan if (a) at the Loan
Closing, the Borrower does not deliver to the State a Borrower Bond and such
other documents required under Section 2.02(l) hereof, or (b) an Event of
Default has occurred and is continuing under this Loan Agreement. Although the
State intends to disburse proceeds of the Loan to the Borrower at the times and
up to the amounts set forth in Exhibit C to pay a portion of the Cost of the
Project, due to unforeseen circumstances there may not be sufficient Federal
Funds on deposit on any date to make the disbursement in such amount.
Nevertheless, the Borrower agrees that the aggregate principal amount set forth
in Exhibit A-2 hereto shall constitute the initial principal amount of the Loan
(as the same may be adjusted downward in accordance with the definition
thereof), and the State shall have no obligation thereafter to loan any
additional amounts to the Borrower.
The Borrower shall have no legal or equitable interest in the Federal
Funds received by and available to the State or in moneys from repayments of
loans previously made from Federal Funds by the State.
The Borrower shall use the proceeds of the Loan strictly in accordance
with Section 2.01(h) hereof.
The payment obligations created under this Loan Agreement and the
obligations to pay the principal of and other amounts due under the Borrower
Bond are each direct, general, irrevocable and unconditional obligations of the
Borrower payable from any source legally available to the Borrower in accordance
with the terms of and to the extent provided in the Borrower Bond Resolution.
SECTION 3.02. Disbursement of Loan Proceeds. (a) The State shall disburse
Federal Funds earmarked for the Loan to the Borrower in accordance with the
terms hereof. Before each and every disbursement of the proceeds of the Loan by
the State to the Borrower, the Borrower shall in accordance with the procedures
set forth in the Regulations submit to the State a requisition executed by an
Authorized Officer of the Borrower.
(b) The State shall not be under any obligation to disburse any Loan
proceeds to the Borrower under this Loan Agreement, unless:
(i) the Loan Closing shall have occurred on the date established
therefor by the State;
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(ii) there shall be Federal Funds available from time to time to
fund the Loan, as determined solely by the State;
(iii) in accordance with the "New Jersey Environmental
Infrastructure Trust Act", P.L. 1985, c. 334, as amended (N.J.S.A.
58:11B-1 et seq.), and the Regulations, the Borrower shall have timely
applied for, shall have been awarded and, prior to or simultaneously with
the Loan Closing, shall have closed a Trust Loan for a portion of the
Allowable Costs (as defined in such Regulations) of the Project in an
amount not in excess of the amount of Allowable Costs of the Project
financed by the Loan from the State, plus the amount of: (i) capitalized
interest during the Project construction period, if any, (ii) the cost of
funding reserve capacity for the Project, if any, as well as that portion
of the Debt Service Reserve Fund (as defined in the Trust Loan Agreement)
attributable to the cost of funding such reserve capacity for the Project,
and (iii) certain issuance expenses related thereto, including, if
applicable, a municipal bond insurance policy premium;
(iv) the Borrower shall have on hand moneys to pay for the greater
of (A) that portion of the total cost of the Project that is not eligible
to be funded from the Loan or the Trust Loan, or (B) that portion of the
total cost of the Project that exceeds the actual amounts of the loan
commitments made by the State and the Trust, respectively, for the Loan
and the Trust Loan; and
(v) no Event of Default nor any event that, with the passage of time
or service of notice or both, would constitute an Event of Default shall
have occurred and be continuing hereunder.
SECTION 3.03. Amounts Payable. (a) The Borrower shall repay the Loan at
zero-interest in principal installments payable to the Trustee semiannually on
the Principal Payment Dates, in accordance with the schedule set forth in
Exhibit A-2 attached hereto and made a part hereof, as the same may be amended
or modified by the State, in particular, without limitation, to make any
adjustments to the amount of the Loan in accordance with the definition thereof;
provided, however, that the amount of any reduction in the principal amount of
the Loan pursuant to N.J.A.C. 7:22-3.26 shall be credited to the principal
payments set forth in Exhibit A-2 in inverse order of their maturity. The
obligations of the Borrower under the Borrower Bond shall be deemed to be
amounts payable under this Section 3.03. Each payment made to the Trustee
pursuant to the Borrower Bond shall be deemed to be a credit against the
corresponding obligation of the Borrower under this Section 3.03, and any such
payment made to the Trustee shall fulfill the Borrower's obligation to pay such
amount hereunder and under the Borrower Bond. Each payment made to the Trustee
pursuant to this Section 3.03 shall be applied to the principal of the Loan.
(b) In addition to the principal payments on the Loan required by
subsection (a) of this Section 3.03, the Borrower shall pay a late charge for
any such payment that is received by the Trustee later than the tenth (10th) day
following its due date in an amount equal to the greater of twelve percent (12%)
per annum or the Prime Rate plus one half of one percent per annum on
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such late payment from its due date to the date actually paid; provided,
however, that such late charge payable on the Loan shall not be in excess of the
maximum interest rate permitted by law.
(c) In addition to the Loan Repayments payable under subsections (a) and
(b) of this Section 3.03, the Borrower shall pay one-half of the Administrative
Fee, if any, to the Trustee semiannually on each Principal Payment Date,
commencing with the first Principal Payment Date subsequent to the Loan Closing.
SECTION 3.04. Unconditional Obligations. The obligation of the Borrower to
make the Loan Repayments and all other payments required hereunder and the
obligation to perform and observe the other duties, covenants, obligations and
agreements on its part contained herein shall be absolute and unconditional, and
shall not be abated, rebated, set-off, reduced, abrogated, terminated, waived,
diminished, postponed or otherwise modified in any manner or to any extent
whatsoever while any Loan Repayments remain unpaid, for any reason, regardless
of any contingency, act of God, event or cause whatsoever, including (without
limitation) any acts or circumstances that may constitute failure of
consideration, eviction or constructive eviction, the taking by eminent domain
or destruction of or damage to the Project or Environmental Infrastructure
System, commercial frustration of the purpose, any change in the laws of the
United States of America or of the State or any political subdivision of either
or in the rules or regulations of any governmental authority, any failure of the
State to perform and observe any agreement, whether express or implied, or any
duty, liability or obligation arising out of or connected with the Project or
this Loan Agreement, or any rights of set-off, recoupment, abatement or
counterclaim that the Borrower might otherwise have against the State, the
Trustee or any other party or parties; provided, however, that payments
hereunder shall not constitute a waiver of any such rights. The Borrower shall
not be obligated to make any payments required to be made by any other Borrowers
under separate Loan Agreements.
SECTION 3.05. Loan Agreement to Survive Loan. The Borrower acknowledges
that its duties, covenants, obligations and agreements set forth in Sections
3.06(a) and (b) hereof shall survive the payment in full of the Loan.
SECTION 3.06. Disclaimer of Warranties and Indemnification. (a) The
Borrower acknowledges and agrees that: (i) the State does not make any warranty
or representation, either express or implied, as to the value, design,
condition, merchantability or fitness for particular purpose or fitness for any
use of the Environmental Infrastructure System or the Project or any portions
thereof or any other warranty or representation with respect thereto; (ii) in no
event shall the State or its agents be liable or responsible for any incidental,
indirect, special or consequential damages in connection with or arising out of
this Loan Agreement or the Project or the existence, furnishing, functioning or
use of the Environmental Infrastructure System or the Project or any item or
products or services provided for in this Loan Agreement; and (iii) to the
fullest extent permitted by law, the Borrower shall indemnify and hold the State
harmless against, and the Borrower shall pay any and all, liability, loss, cost,
damage, claim, judgment or expense of any and all kinds or nature and however
arising and imposed by law, which the State may sustain, be subject to or be
caused to incur by reason of any claim, suit or action based upon personal
injury, death or damage to property, whether real, personal or mixed, or upon or
arising
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out of contracts entered into by the Borrower, the Borrower's ownership of the
Environmental Infrastructure System or the Project, or the acquisition,
construction or installation of the Project.
(b) It is mutually agreed by the Borrower and the State that the State and
its commissioners, officers, agents, servants or employees shall not be liable
for, and shall be indemnified and saved harmless by the Borrower in any event
from, any action performed under this Loan Agreement and any claim or suit of
whatsoever nature, except in the event of loss or damage resulting from their
own negligence or willful misconduct.
(c) In connection with its obligation to provide the insurance required
under Section 2.02(j) hereof: (i) the Borrower shall include, or cause to be
included, the State and its employees and officers as additional "named
insureds" on (A) any certificate of liability insurance procured by the Borrower
(or other similar document evidencing the liability insurance coverage procured
by the Borrower) and (B) any certificate of liability insurance procured by any
contractor or subcontractor for the Project, and from the latter of the date of
the Loan Closing or the date of the initiation of construction of the Project
until the date the Borrower receives the written certificate of Project
completion from the State, the Borrower shall maintain said liability insurance
covering the State and said employees and officers in good standing; and (ii)
the Borrower shall include the State as an additional "named insured" on any
certificate of insurance providing against risk of direct physical loss, damage
or destruction of the Environmental Infrastructure System, and during the Loan
Term the Borrower shall maintain said insurance covering the State in good
standing.
The Borrower shall provide the State with a copy of each of any such
original, supplemental, amendatory or reissued certificates of insurance (or
other similar documents evidencing the insurance coverage) required pursuant to
this Section 3.06(c).
SECTION 3.07. Option to Prepay Loan Repayments. The Borrower may prepay
the Loan Repayments, in whole or in part, upon not less than ninety (90) days'
prior written notice to the State; provided, however, that any such full or
partial prepayment may only be made (i) if the Borrower is not then in arrears
on its Trust Loan, (ii) if the Borrower is contemporaneously making a full or
partial prepayment of the Trust Loan such that, after the prepayment of the Loan
and the Trust Loan, the Trust gives its consent required under Section 3.07(iii)
of the Trust Loan Agreement, and (iii) upon the prior written approval of the
State. Prepayments shall be applied to the principal payments on the portion of
the Loan to be prepaid in inverse order of their maturity.
SECTION 3.08. Priority of Loan and Trust Loan. (a) The Borrower hereby
agrees that, to the extent allowed by law, including, without limitation, the
appropriations act of the New Jersey State Legislature authorizing the
expenditure of Trust bond proceeds to finance a portion of the Cost of the
Project, or the Borrower Bond Resolution, any loan repayments then due and
payable on the Borrower's Trust Loan, including, without limitation, any
administrative fees and any late payment charges then due and payable under the
Trust Loan Agreement, shall be satisfied by the Borrower before any Loan
Repayments then due and payable hereunder on the Loan shall be satisfied by the
Borrower.
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(b) The Borrower hereby acknowledges that in the event the Borrower fails
or is unable to pay promptly to the Trust in full any loan repayments on the
Trust Loan, then any Loan Repayments paid by the Borrower on the Loan under this
Loan Agreement and received by the Trustee during the time of any such loan
repayment deficiency under the Trust Loan Agreement shall be applied by the
Trustee first to satisfy such Trust Loan Agreement loan repayment deficiency as
a credit against the obligations of the Borrower to make loan repayments of that
portion of interest under the Trust Loan Agreement that is allocable to the
interest payable on the Trust Bonds (as defined in the Trust Loan Agreement) and
to make payments of that portion of interest under the bond or note issued by
the Borrower to the Trust that is allocable to the interest payable on the Trust
Bonds, second, to the extent available, to make loan repayments of principal
under the Trust Loan Agreement and payments of principal on the bond or note
issued by the Borrower to the Trust pursuant to the Trust Loan Agreement, third,
to the extent available, to the payment of the administrative fee payable under
the Trust Loan Agreement and to make payments of that portion of interest under
the bond or note issued by the Borrower to the Trust that is allocable to the
administrative fee payable under the Trust Loan Agreement, fourth, to the extent
available, to the payment of late charges payable under the Trust Loan Agreement
and to make payments of that portion of interest under the bond or note issued
by the Borrower to the Trust that is allocable to the late charges payable under
the Trust Loan Agreement, and finally, to the extent available, to make Loan
Repayments on the Loan.
(c) The Borrower hereby further acknowledges that any Loan Repayments paid
by the Borrower on the Loan under this Loan Agreement shall be applied according
to the provisions of the Master Program Trust Agreement.
SECTION 3.09. Approval of the New Jersey State Treasurer. The Borrower and
the State hereby acknowledge that prior to or simultaneously with the Loan
Closing the New Jersey State Treasurer, in satisfaction of the requirements of
Section 9a of the Act, issued the "Certificate of the New Jersey State Treasurer
Regarding the Approval of the Trust Loan and the Fund Loan" (the "Treasurer's
Certificate"). Pursuant to the terms of the Treasurer's Certificate, the New
Jersey State Treasurer approved the Loan and the terms and conditions thereof as
established by the provisions of this Loan Agreement.
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ARTICLE IV
ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND
SECTION 4.01. Assignment and Transfer by State. The Borrower hereby
approves and consents to any assignment or transfer of this Loan Agreement and
the Borrower Bond that the State deems to be necessary in connection with the
environmental infrastructure loan program of the State under the Regulations.
SECTION 4.02. Assignment by Borrower. Neither this Loan Agreement nor the
Borrower Bond may be assigned by the Borrower for any reason, unless the
following conditions shall be satisfied: (i) the State shall have approved said
assignment in writing; (ii) the assignee shall have expressly assumed in writing
the full and faithful observance and performance of the Borrower's duties,
covenants, obligations and agreements under this Loan Agreement and, to the
extent permitted under applicable law, the Borrower Bond; and (iii) immediately
after such assignment, the assignee shall not be in default in the observance or
performance of any duties, covenants, obligations or agreements of the Borrower
under this Loan Agreement or the Borrower Bond.
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ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
SECTION 5.01. Events of Default. If any of the following events occur, it
is hereby defined as and declared to be and to constitute an "Event of Default":
(a) failure by the Borrower to pay, or cause to be paid, any Loan
Repayment required to be paid hereunder when due, which failure shall continue
for a period of fifteen (15) days;
(b) failure by the Borrower to make, or cause to be made, any required
payments of principal, redemption premium, if any, and interest on any bonds,
notes or other obligations of the Borrower issued under the Borrower Bond
Resolution (other than the Loan and the Borrower Bond) or otherwise secured by
all or a portion of the property pledged under the Borrower Bond Resolution,
after giving effect to the applicable grace period;
(c) failure by the Borrower to pay, or cause to be paid, any late charges
incurred hereunder or any portion thereof when due or to observe and perform any
duty, covenant, obligation or agreement on its part to be observed or performed
under this Loan Agreement, other than as referred to in subsection (a) of this
Section 5.01 or other than the obligations of the Borrower contained in Section
2.02(d)(ii) hereof and in Exhibit F hereto, which failure shall continue for a
period of thirty (30) days after written notice, specifying such failure and
requesting that it be remedied, is given to the Borrower by the State, unless
the State shall agree in writing to an extension of such time prior to its
expiration; provided, however, that if the failure stated in such notice is
correctable but cannot be corrected within the applicable period, the State may
not unreasonably withhold its consent to an extension of such time up to 120
days from the delivery of the written notice referred to above if corrective
action is instituted by the Borrower within the applicable period and diligently
pursued until the Event of Default is corrected;
(d) any representation made by or on behalf of the Borrower contained in
this Loan Agreement, or in any instrument furnished in compliance with or with
reference to this Loan Agreement or the Loan, is false or misleading in any
material respect;
(e) a petition is filed by or against the Borrower under any federal or
state bankruptcy or insolvency law or other similar law in effect on the date of
this Loan Agreement or thereafter enacted, unless in the case of any such
petition filed against the Borrower such petition shall be dismissed within
thirty (30) days after such filing and such dismissal shall be final and not
subject to appeal; or the Borrower shall become insolvent or bankrupt or shall
make an assignment for the benefit of its creditors; or a custodian (including,
without limitation, a receiver, liquidator or trustee) of the Borrower or any of
its property shall be appointed by court order or take possession of the
Borrower or its property or assets if such order remains in effect or such
possession continues for more than thirty (30) days;
(f) the Borrower shall generally fail to pay its debts as such debts
become due; and
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(g) failure of the Borrower to observe or perform such additional duties,
covenants, obligations, agreements or conditions as are required by the State
and specified in Exhibit F attached hereto and made a part hereof.
SECTION 5.02. Notice of Default. The Borrower shall give the State prompt
telephonic notice of the occurrence of any Event of Default referred to in
Section 5.01(d) or (e) hereof and of the occurrence of any other event or
condition that constitutes an Event of Default at such time as any senior
administrative or financial officer of the Borrower becomes aware of the
existence thereof.
SECTION 5.03. Remedies on Default. Whenever an Event of Default referred
to in Section 5.01 hereof shall have occurred and be continuing, the State shall
have the right to take whatever action at law or in equity may appear necessary
or desirable to collect the amounts then due and thereafter to become due
hereunder or to enforce the observance and performance of any duty, covenant,
obligation or agreement of the Borrower hereunder.
In addition, if an Event of Default referred to in Section 5.01(a) hereof
shall have occurred and be continuing, the State shall, to the extent allowed by
applicable law, have the right to declare all Loan Repayments and all other
amounts due hereunder (including, without limitation, payments under the
Borrower Bond) to be immediately due and payable, and upon notice to the
Borrower the same shall become due and payable without further notice or demand.
SECTION 5.04. Attorneys' Fees and Other Expenses. The Borrower shall on
demand pay to the State the reasonable fees and expenses of attorneys and other
reasonable expenses (including, without limitation, the reasonably allocated
costs of in-house counsel and legal staff) incurred by the State in the
collection of Loan Repayments or any other sum due hereunder or in the
enforcement of the observation or performance of any other duties, covenants,
obligations or agreements of the Borrower upon an Event of Default.
SECTION 5.05. Application of Moneys. Any moneys collected by the State
pursuant to Section 5.03 hereof shall be applied (a) first to pay any attorneys'
fees or other fees and expenses owed by the Borrower pursuant to Section 5.04
hereof, (b) second, to the extent available, to pay principal due and payable on
the Loan, (c) third, to the extent available, to pay any other amounts due and
payable hereunder, and (d) fourth, to the extent available, to pay principal on
the Loan and other amounts payable hereunder as such amounts become due and
payable.
SECTION 5.06. No Remedy Exclusive; Waiver; Notice. No remedy herein
conferred upon or reserved to the State is intended to be exclusive, and every
such remedy shall be cumulative and shall be in addition to every other remedy
given under this Loan Agreement or now or hereafter existing at law or in
equity. No delay or omission to exercise any right, remedy or power accruing
upon any Event of Default shall impair any such right, remedy or power or shall
be construed to be a waiver thereof, but any such right, remedy or power may be
exercised from time to time and as often as may be deemed expedient. In order to
entitle the State to exercise any remedy reserved to it in this Article V, it
shall not be necessary to give any notice other than such notice as may be
required in this Article V.
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SECTION 5.07. Retention of State's Rights. Notwithstanding any assignment
or transfer of this Loan Agreement pursuant to the provisions hereof, or
anything else to the contrary contained herein, the State shall have the right
upon the occurrence of an Event of Default to take any action, including
(without limitation) bringing an action against the Borrower at law or in
equity, as the State may, in its discretion, deem necessary to enforce the
obligations of the Borrower to the State pursuant to Section 5.03 hereof.
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ARTICLE VI
MISCELLANEOUS
SECTION 6.01. Notices. All notices, certificates or other communications
hereunder shall be sufficiently given and shall be deemed given when hand
delivered or mailed by registered or certified mail, postage prepaid, to the
Borrower at the address specified in Exhibit A-1 attached hereto and made a part
hereof and to the State and the Trustee at the following addresses:
(a) State:
New Jersey Department of Environmental Protection
Municipal Finance and Construction Element
401 East State Street - 3rd Floor
Trenton, New Jersey 08625-0425
Attention: Assistant Director
New Jersey Department of the Treasury
Office of Public Finance
State Street Square - 5th Floor
Trenton, New Jersey 08625-0002
Attention: Director
(b) Trustee:
Wachovia Bank, National Association
21 South Street, 3rd Floor
Morristown, New Jersey 07960
Attention: Corporate Trust Department
Any of the foregoing parties may designate any further or different
addresses to which subsequent notices, certificates or other communications
shall be sent by notice in writing given to the others.
SECTION 6.02. Binding Effect. This Loan Agreement shall inure to the
benefit of and shall be binding upon the State and the Borrower and their
respective successors and assigns.
SECTION 6.03. Severability. In the event any provision of this Loan
Agreement shall be held illegal, invalid or unenforceable by any court of
competent jurisdiction, such holding shall not invalidate, render unenforceable
or otherwise affect any other provision hereof.
SECTION 6.04. Amendments, Supplements and Modifications. This Loan
Agreement may not be amended, supplemented or modified without the prior written
consent of the State and the Borrower.
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SECTION 6.05. Execution in Counterparts. This Loan Agreement may be
executed in several counterparts, each of which shall be an original and all of
which shall constitute but one and the same instrument.
SECTION 6.06. Applicable Law and Regulations. This Loan Agreement shall be
governed by and construed in accordance with the laws of the State, including
the Regulations, which Regulations are, by this reference thereto, incorporated
herein as part of this Loan Agreement.
SECTION 6.07. Consents and Approvals. Whenever the written consent or
approval of the State shall be required under the provisions of this Loan
Agreement, such consent or approval may only be given by the State.
SECTION 6.08. Captions. The captions or headings in this Loan Agreement
are for convenience only and shall not in any way define, limit or describe the
scope or intent of any provisions or sections of this Loan Agreement.
SECTION 6.09. Further Assurances. The Borrower shall, at the request of
the State, authorize, execute, attest, acknowledge and deliver such further
resolutions, conveyances, transfers, assurances, financing statements and other
instruments as may be necessary or desirable for better assuring, conveying,
granting, assigning and confirming the rights, security interests and agreements
granted or intended to be granted by this Loan Agreement and the Borrower Bond.
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IN WITNESS WHEREOF, the State and the Borrower have caused this Loan
Agreement to be executed, sealed and delivered as of the date first above
written.
THE STATE OF NEW JERSEY,
ACTING BY AND THROUGH THE
NEW JERSEY DEPARTMENT OF
ENVIRONMENTAL PROTECTION
[SEAL]
By:_____________________________
ATTEST: Bradley M. Campbell
Commissioner, Department of
Environmental Protection
- -----------------------------
Stanley V. Cach, Jr. P.E., P.P.
Assistant Director,
Municipal Finance and Construction Element,
Department of Environmental Protection
MIDDLESEX WATER COMPANY
[SEAL]
By: /s/Dennis G. Sullivan
---------------------------
ATTEST: Dennis G. Sullivan
President
/s/Kenneth J. Quinn
- ---------------------------
Kenneth J. Quinn
Secretary
[Signature Page]
SCHEDULE A
Certain Additional Loan Agreement Provisions
--------------------------------------------
S-1
EXHIBIT A-1
Description of Project and Environmental Infrastructure System
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A-1-1
EXHIBIT A-2
Description of Loan
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A-2-1
EXHIBIT B
Basis for Determination of Allowable Project Costs
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B-1
EXHIBIT C
Estimated Disbursement Schedule
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C-1
EXHIBIT D
Specimen Borrower Bond
----------------------
D-1
(To be supplied by Borrower's
bond counsel in substantially the following form)
IMPORTANT NOTE: The next two pages set forth the form of the Borrower Bond
prepared by the Trust's Bond Counsel for municipal/county Borrowers. Although
the Trust recognizes that each corporate Borrower has its own bond form as
required pursuant to its Borrower Bond Resolution, please incorporate in the
bond form the pertinent information from this municipal/county bond form (e.g.,
include the concept of principal amount or lesser amount under Section 3.01,
reference to payments to the Trustee, disbursement process, unconditional
nature, prepayment, security and date). To the extent that you do not have an
existing Bond Resolution, the pledge under your Bond Resolution should be
drafted to constitute a general obligation pledge of (i) all the gross revenues
of the company and (ii) any specific property (e.g. mortgage) or other security
pledged for this transaction (e.g. letter of credit).
D-2
SEE IMPORTANT NOTE ON PRIOR PAGE
FOR VALUE RECEIVED, [NAME OF BORROWER], a corporation duly created and
validly existing under the Constitution and laws of the State of New Jersey (the
"Borrower"), hereby promises to pay to the order of the State of New Jersey (the
"State") the principal amount of ___________________ Dollars ($__________), or
such lesser amount as shall be determined in accordance with Section 3.01 of the
Loan Agreement (as hereinafter defined), at the times and in the amounts
determined as provided in the Loan Agreement, plus any other amounts due and
owing under the Loan Agreement at the times and in the amounts as provided
therein. The Borrower irrevocably pledges its full faith and credit for the
punctual payment of the principal of, and all other amounts due under, this
Borrower Bond and the Loan Agreement according to their respective terms.
This Borrower Bond is issued pursuant to the Loan Agreement dated as of
November 1, 2003 by and between the State, acting by and through the New Jersey
Department of Environmental Protection, and the Borrower (the "Loan Agreement").
This Borrower Bond is issued in consideration of the loan made under the Loan
Agreement (the "Loan") to evidence the payment obligations of the Borrower set
forth therein. Payments under this Borrower Bond shall, except as otherwise
provided in the Loan Agreement, be made directly to the Trustee (as defined in
the Loan Agreement) for the account of the State. This Borrower Bond is subject
to assignment or endorsement in accordance with the terms of the Loan Agreement.
All of the terms, conditions and provisions of the Loan Agreement are, by this
reference thereto, incorporated herein as part of this Borrower Bond.
Pursuant to the Loan Agreement, disbursements shall be made by the State
to the Borrower upon receipt by the State of requisitions from the Borrower
executed and delivered in accordance with the requirements set forth in Section
3.02 of the Loan Agreement.
This Borrower Bond is entitled to the benefits and is subject to the
conditions of the Loan Agreement. The obligations of the Borrower to make the
payments required hereunder shall be absolute and unconditional, without any
defense or right of set-off, counterclaim or recoupment by reason of any default
by the State under the Loan Agreement or under any other agreement between the
Borrower and the State or out of any indebtedness or liability at any time owing
to the Borrower by the State or for any other reason.
This Borrower Bond is subject to optional prepayment under the terms and
conditions, and in the amounts, provided in Section 3.07 of the Loan Agreement.
To the extent allowed by applicable law, this Borrower Bond may be subject to
acceleration under the terms and conditions, and in the amounts, provided in
Section 5.03 of the Loan Agreement.
To the extent provided by law, this Borrower Bond is junior and
subordinate in all respects to any bonds or notes of the Borrower issued on even
date herewith to the New Jersey Environmental Infrastructure Trust as to lien
on, and source and security for payment from, the revenues of the Borrower.
D-3
IN WITNESS WHEREOF, the Borrower has caused this Borrower Bond to be duly
executed, sealed and delivered as of October 15, 2003.
[NAME OF BORROWER]
[SEAL]
By:_____________________________________
ATTEST: Mayor
_______________________ By:_____________________________________
Clerk Chief Financial Officer/Treasurer
D-4
EXHIBIT E
Opinions of Borrower's Bond and General Counsels
------------------------------------------------
E-1
[LETTERHEAD OF COUNSEL TO BORROWER]
November 6, 2003
State of New Jersey
Department of Environmental Protection
401 East State Street
Trenton, New Jersey 08625
Ladies and Gentlemen:
We have acted as counsel to [Name of Borrower], a corporation duly
organized and validly existing under the laws of the State of New Jersey (the
"Borrower"), which has entered into a Loan Agreement (as hereinafter defined)
with the State of New Jersey, acting by and through the New Jersey Department of
Environmental Protection (the "State"), and have acted as such in connection
with the authorization, execution, attestation and delivery by the Borrower of
its Loan Agreement and Borrower Bond (as hereinafter defined) pursuant to the
New Jersey Business Corporation Act, P.L. 1968, c. 263, as amended (the
"Business Corporation Law"), and a [bond resolution] [indenture] of the Borrower
[adopted on] [dated] [DATE] and entitled "[TITLE]", as amended and supplemented,
including by a supplemental [resolution] [indenture] [adopted on] [dated] [DATE]
and entitled "[TITLE]" (such [resolutions] [indentures] shall be collectively
referred to herein as the "Resolution"). All capitalized terms used but not
defined herein shall have the meanings ascribed to such terms in the Loan
Agreement.
In so acting, we have examined the Constitution and laws of the State of
New Jersey, including, without limitation, the Business Corporation Law, and the
certificate of incorporation and by-laws of the Borrower. We have also examined
originals, or copies certified or otherwise identified to our satisfaction, of
the following:
(a) the Loan Agreement dated as of November 1, 2003 (the "Loan Agreement")
by and between the State and the Borrower;
(b) the proceedings of the board of directors of the Borrower relating to
the approval of the Loan Agreement and the execution, attestation and delivery
thereof on behalf of the Borrower and the authorization of the undertaking and
completion of the Project;
(c) the Borrower Bond dated as of October 15, 2003 (the "Borrower Bond")
issued by the Borrower to the State to evidence the Loan; and
(d) the proceedings (together with the proceedings referred to in clause
(b) above and Section 5 below, the "Proceedings") of the board of directors of
the Borrower, including, without limitation, the Resolution, relating to the
authorization of the Borrower Bond and the sale, execution, attestation,
authentication and delivery thereof to the State (the Loan Agreement and the
Borrower Bond are referred to herein collectively as the "Loan Documents").
E-2
We have also examined and relied upon originals, or copies certified or
otherwise authenticated to our satisfaction, of such other records, documents,
certificates and other instruments, and have made such investigation of law as
in our judgment we have deemed necessary or appropriate, to enable us to render
the opinions expressed below.
We are of the opinion that:
1. The Borrower is a corporation duly created and validly existing under
and pursuant to the Constitution and statutes of the State of New Jersey,
including the Business Corporation Law, with the legal right to carry on the
business of its Environmental Infrastructure System as currently being conducted
and as proposed to be conducted.
2. The Borrower has full legal right and authority to execute, attest and
deliver the Loan Documents, to sell the Borrower Bond to the State, to cause the
authentication of the Borrower Bond, to observe and perform its duties,
covenants, obligations and agreements under the Loan Documents and to undertake
and complete the Project.
3. The acting officers of the Borrower who are contemporaneously herewith
performing or have previously performed any action contemplated in the Loan
Agreement are, and at the time any such action was performed were, the duly
appointed or elected officers of the Borrower empowered by applicable New Jersey
law and authorized by resolution of the Borrower to perform such actions.
4. In accordance with the terms of the Resolution and to the extent
provided therein, the Borrower has irrevocably pledged its full faith and credit
for the punctual payment of the Loan Repayments and all other amounts due under
the Loan Documents according to their respective terms.
5. The proceedings of the Borrower's board of directors (i) approving the
Loan Documents, (ii) authorizing their execution, attestation and delivery on
behalf of the Borrower, (iii) with respect to the Borrower Bond only,
authorizing its sale by the Borrower to the State and authorizing its
authentication on behalf of the Borrower, (iv) authorizing the Borrower to
consummate the transactions contemplated by the Loan Documents, (v) authorizing
the Borrower to undertake and complete the Project, and (vi) authorizing the
execution and delivery of all other certificates, agreements, documents and
instruments in connection with the execution, attestation and delivery of the
Loan Documents, have each been duly and lawfully adopted and authorized in
accordance with applicable law and applicable resolutions of the Borrower,
including, without limitation, the Resolution, the other Proceedings and the
Business Corporation Law, which Proceedings constitute all of the actions
necessary to be taken by the Borrower to authorize its actions contemplated by
clauses (i) through (vi) above and which Proceedings, including, without
limitation, the Resolution, were duly adopted in accordance with applicable New
Jersey law at a meeting or meetings duly called and held in accordance with
applicable New Jersey law and at which quorums were present and acting
throughout.
6. The Loan Documents have been duly authorized, executed, attested and
delivered by the Authorized Officers of the Borrower, the Borrower Bond has been
duly sold by the
E-3
Borrower to the State, and the Borrower Bond has been duly authenticated by the
trustee or paying agent under the Resolution, if applicable; and assuming in the
case of the Loan Agreement that the State has the requisite power and authority
to authorize, execute, attest and deliver, and has duly authorized, executed,
attested and delivered, the Loan Agreement, the Loan Documents constitute the
legal, valid and binding obligations of the Borrower, enforceable against the
Borrower in accordance with their respective terms, subject, however, to the
effect of, and to restrictions and limitations imposed by or resulting from,
bankruptcy, insolvency, moratorium, reorganization or other similar laws
affecting creditors' rights generally. No opinion is rendered as to the
availability of any particular remedy.
7. The authorization, execution, attestation and delivery of the Loan
Documents by the Borrower and, in the case of the Borrower Bond only, the
authentication thereof by the trustee or paying agent under the Resolution and
the sale thereof to the State, the observation and performance by the Borrower
of its duties, covenants, obligations and agreements thereunder, the
consummation of the transactions contemplated therein, and the undertaking and
completion of the Project do not and will not (i) other than the lien, charge or
encumbrance created by the Loan Documents, by the Resolution and by any other
outstanding debt obligations of the Borrower that are at parity with the
Borrower Bond as to lien on, and source and security for payment thereon from,
the revenues of the Borrower, result in the creation or imposition of any lien,
charge or encumbrance upon any properties or assets of the Borrower pursuant to,
(ii) result in any breach of any of the terms, conditions or provisions of, or
(iii) constitute a default under, any existing resolution, outstanding debt or
lease obligation, trust agreement, indenture, mortgage, deed of trust, loan
agreement or other instrument to which the Borrower is a party or by which the
Borrower, its Environmental Infrastructure System or any of its properties or
assets may be bound, nor will such action result in any violation of the
provisions of the charter or other document pursuant to which the Borrower was
established or any laws, ordinances, injunctions, judgments, decrees, rules,
regulations or existing orders of any court or governmental or administrative
agency, authority or person to which the Borrower, its Environmental
Infrastructure System or its properties or operations is subject.
8. All approvals, consents or authorizations of, or registrations of or
filings with, any governmental or public agency, authority or person required to
date on the part of the Borrower in connection with the authorization,
execution, attestation, delivery and performance of the Loan Documents, the sale
of the Borrower Bond and the undertaking and completion of the Project have been
obtained or made.
9. There is no litigation or other proceeding pending or, to our
knowledge, after due inquiry, threatened in any court or other tribunal of
competent jurisdiction (either State or federal) (i) questioning the creation,
organization or existence of the Borrower, (ii) questioning the validity,
legality or enforceability of the Resolution, the Loan or the Loan Documents,
(iii) questioning the undertaking or completion of the Project, (iv) otherwise
challenging the Borrower's ability to consummate the transactions contemplated
by the Loan or the Loan Documents, or (v) that, if adversely decided, would have
a materially adverse impact on the financial condition of the Borrower.
E-4
10. Other than its bond or note dated as of October 15, 2003 issued to the
New Jersey Environmental Infrastructure Trust, the Borrower has no bonds, notes
or other debt obligations outstanding that are superior or senior to the
Borrower Bond as to lien on, and source and security for payment thereof from,
the revenues of the Borrower.
[11. To the best of our knowledge, upon due inquiry, (i) all
representations made by the Borrower contained within Exhibit F of the Loan
Agreement are true, accurate and complete, and (ii) all expectations contained
therein are reasonable, and we know of no reason why the Borrower would be
unable to comply on a continuing basis with the covenants contained within
Exhibit F of the Loan Agreement.]
We hereby authorize McCarter & English, LLP, acting as bond counsel to the
State in connection with the Loan, and the Attorney General of the State of New
Jersey, acting as general counsel to the State in connection with the Loan, to
rely on this opinion as if we had addressed this opinion to them in addition to
you.
Very truly yours,
E-5
EXHIBIT F
Additional Covenants and Requirements
-------------------------------------
F-1
EXHIBIT G
General Administrative Requirements for the
State Environmental Infrastructure Financing Program
----------------------------------------------------
G-1
M O R T G A G E
THIRTIETH SUPPLEMENTAL INDENTURE
MIDDLESEX WATER COMPANY
TO
WACHOVIA BANK, NATIONAL ASSOCIATION
Trustee
Dated as of October 15, 2004
Record and Return to:
Peter D. Hutcheon, Esq.
Norris, McLaughlin & Marcus, P.A.
721 Route 202/206
P.O. Box 1018
Somerville, NJ 08876
(908) 722-0700
Prepared By:_______________________
Peter D. Hutcheon, Esq.
THIS THIRTIETH SUPPLEMENTAL INDENTURE, dated as of the 15th day of
October, 2004, between MIDDLESEX WATER COMPANY, a corporation organized and
existing under the laws of the State of New Jersey, having its principal office
in the Township of Iselin, New Jersey (herein called the "Water Company"), and
WACHOVIA BANK, NATIONAL ASSOCIATION (as successor to First Union National Bank,
the successor to Meridian Bank, the successor to United Counties Trust Company
in turn the successor to the Union County Trust Company), a corporation
organized and existing under the laws of the United States, having its principal
New Jersey corporate trust office in the Town of Morristown, New Jersey, as
Trustee under the Indenture of Mortgage hereinafter mentioned (herein called the
"Trustee"):
WHEREAS, on April 1, 1927, Water Company executed and delivered to
the Trustee an Indenture of Mortgage (herein called the "Mortgage") to secure
its First and Refunding Mortgage Gold Bonds, Series A, 5-1/2%, which bonds have
since been redeemed by Water Company, and which Mortgage provides that bonds of
other series may be issued under and pursuant to an indenture supplemental
thereto; and
WHEREAS, on May 14, 1935, Water Company executed and delivered to
the Trustee a Supplemental Indenture to secure its First and Refunding Mortgage
Bonds, Series B, 4-1/2%, which Supplemental Indenture, prior to the execution
and delivery hereof, was satisfied and discharged of record, no bonds having
been issued thereunder; and
WHEREAS, as of October 1, 1939, Water Company executed and delivered
to the Trustee a Second Supplemental Indenture of Mortgage (herein called the
"Second Supplemental Indenture") to secure its First and Refunding Mortgage
3-3/4% Bonds, Series C (herein called the "Series C Bonds"), which bonds were
paid at maturity by Water Company, and otherwise modifying, amending and
supplementing the Mortgage; and
WHEREAS, as of April 1, 1946, Water Company executed and delivered
to the Trustee a Third Supplemental Indenture of Mortgage (herein called the
"Third Supplemental Indenture") to secure its First and Refunding Mortgage 3%
Bonds, Series D (herein called the "Series D Bonds"), which bonds were paid at
maturity by Water Company, and otherwise modifying, amending and supplementing
the Mortgage; and
WHEREAS, as of April 1, 1949, Water Company executed and delivered
to the Trustee a Fourth Supplemental Indenture of Mortgage (herein called the
"Fourth Supplemental Indenture") to secure its First Mortgage 3-1/2% Bonds,
Series E (herein called the "Series E Bonds"), which bonds were paid at maturity
by Water Company, and otherwise modifying, amending and supplementing the
Mortgage; and
WHEREAS, as of February 1, 1955, Water Company executed and
delivered to the Trustee a Fifth Supplemental Indenture of Mortgage (herein
called the "Fifth Supplemental Indenture") to secure its First Mortgage 3-5/8%
Bonds, Series F (herein called the "Series F
Bonds"), which bonds were paid at maturity by Water Company, and otherwise
supplementing the Mortgage; and
WHEREAS, as of December 1, 1959, Water Company executed and
delivered to the Trustee a Sixth Supplemental Indenture of Mortgage (herein
called the "Sixth Supplemental Indenture") to secure its First Mortgage 5-3/4%
Bonds, Series G (herein called the "Series G Bonds"), which bonds have since
been redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of January 15, 1963, Water Company executed and
delivered to the Trustee a Seventh Supplemental Indenture of Mortgage (herein
called the "Seventh Supplemental Indenture") to secure its First Mortgage 4-1/2%
Bonds, Series H (herein called the "Series H Bonds"), which bonds were paid at
maturity by Water Company and otherwise supplementing the Mortgage; and
WHEREAS, as of July 1, 1964, Water Company executed and delivered to
the Trustee, an Eighth Supplemental Indenture of Mortgage (herein called the
"Eighth Supplemental Indenture") to secure its First Mortgage 4 3/4% Bonds,
Series I (herein called the "Series I Bonds"), which bonds have since been
redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of June 1, 1965, Water Company executed and delivered to
the Trustee a Ninth Supplemental Indenture of Mortgage (herein called the "Ninth
Supplemental Indenture") to secure its First Mortgage 4-3/4% Bonds, Series J
(herein called the "Series J Bonds"), which bonds have since been redeemed by
Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of February 1, 1968, Water Company executed and
delivered to the Trustee a Tenth Supplemental Indenture of Mortgage (herein
called the "Tenth Supplemental Indenture") to secure its First Mortgage 6-3/4%
Bonds, Series K (herein called the "Series K Bonds"), and otherwise
supplementing the Mortgage; and
WHEREAS, as of December 1, 1968, Water Company executed and
delivered to the Trustee an Eleventh Supplemental Indenture of Mortgage (herein
called the "Eleventh Supplemental Indenture") to secure its First Mortgage
6-7/8% Bonds, Series L (herein called the "Series L Bonds"), which bonds have
since been redeemed by Water Company, and otherwise supplementing the Mortgage;
and
WHEREAS, as of December 1, 1970, Water Company executed and
delivered to the Trustee a Twelfth Supplemental Indenture of Mortgage (herein
called the "Twelfth Supplemental Indenture") to secure its First Mortgage 10%
Bonds, Series M (herein called the "Series M Bonds"), which bonds have since
been redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of December 1, 1972, Water Company executed and
delivered to the Trustee a Thirteenth Supplemental Indenture of Mortgage (herein
called the "Thirteenth Supplemental Indenture") to secure its First Mortgage
8-1/8% Bonds, Series N (herein called the "Series N Bonds"), which bonds have
since been redeemed by Water Company, and otherwise supplementing the Mortgage;
and
WHEREAS, as of April 1, 1979, Water Company executed and delivered
to the Trustee a Fourteenth Supplemental Indenture of Mortgage (herein called
the "Fourteenth Supplemental Indenture") to secure its First Mortgage 7% Bonds,
Series 0 (herein called the "Series 0 Bonds"), which bonds have since been
redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of April 1, 1983, Water Company executed and delivered
to the Trustee a Fifteenth Supplemental Indenture of Mortgage (herein called the
"Fifteenth Supplemental Indenture") to secure its First Mortgage 10-1/2% Bonds,
Series P (herein called the "Series P Bonds"), which bonds have since been
redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of August 1, 1988, Water Company executed and delivered
to the Trustee a Sixteenth Supplemental Indenture of Mortgage (herein called the
"Sixteenth Supplemental Indenture") to secure its First Mortgage 8% Bonds,
Series Q (herein called the "Series Q Bonds"), which bonds have since been
redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of June 15, 1991, Water Company executed and delivered
to the Trustee a Seventeenth Supplemental Indenture of Mortgage (herein called
the "Seventeenth Supplemental Indenture") to secure its First Mortgage 7.25%
Bonds, Series R (herein called the "Series R Bonds"), which bonds have since
been redeemed by Water Company, and otherwise supplementing the Mortgage; and
WHEREAS, as of March 1, 1993, Water Company executed and delivered
to the Trustee a Supplementary Indenture of Mortgage to the Fifteenth
Supplemental Indenture of Mortgage (herein called the "Supplementary Indenture
to the Fifteenth Supplemental Indenture") to secure its First Mortgage 2 7/8%,
Series P-1 (herein called the "Series P-1 Bonds"), which bonds have since been
redeemed by Water Company, and otherwise supplementing the Mortgage.
WHEREAS, as of September 1, 1993, Water Company executed and
delivered to the Trustee an Eighteenth Supplemental Indenture of Mortgage
(herein called the "Eighteenth Supplemental Indenture") to secure its First
Mortgage 5.20% Bonds, Series S (herein called the "Series S Bonds"), and
otherwise supplementing the Mortgage; and
WHEREAS, as of September 1, 1993, Water Company executed and
delivered to the Trustee a Nineteenth
Supplemental Indenture of Mortgage (herein called the "Nineteenth Supplemental
Indenture") to secure its First Mortgage 5.25% Bonds, Series T (herein called
the "Series T Bonds"), and otherwise supplementing the Mortgage; and
WHEREAS, as of January 1, 1994, Water Company executed and delivered
to Trustee a Twentieth Supplemental Indenture of Mortgage (herein called the
"Twentieth Supplemental Indenture") to secure its First Mortgage 6.4% Bonds,
Series U (herein called the "Series U Bonds"), and otherwise supplementing the
Mortgage; and
WHEREAS, as of January 1, 1994, Water Company executed and delivered
to Trustee a Twenty-First Supplemental Indenture of Mortgage (herein called the
"Twenty-First Supplemental Indenture") to secure its First Mortgage 5.25% Bonds,
Series V (herein called the "Series V Bonds"), and otherwise supplementing the
Mortgage; and
WHEREAS, as of March 1, 1998, Water Company executed and delivered
to Trustee a Twenty-Second Supplemental Indenture of Mortgage (herein called the
"Twenty-Second Supplemental Indenture") to secure its First Mortgage 5.35%
Bonds, Series W (herein called the "Series W Bonds"), and otherwise
supplementing the Mortgage; and
WHEREAS, as of October 15, 1998, Water Company executed and
delivered to Trustee a Twenty-Third Supplemental Indenture of Mortgage (herein
called the "Twenty-Third Supplemental Indenture") to secure its First Mortgage
0% Bond, Series X (herein called the "Series X Bond"), and otherwise
supplementing the Mortgage; and
WHEREAS, as of October 15, 1998, Water Company executed and
delivered to Trustee a Twenty-Fourth Supplemental Indenture of Mortgage (herein
called the "Twenty-Fourth Supplemental Indenture") to secure its First Mortgage
Scheduled Interest Rate Bond, Series Y (herein called the "Series Y Bond"), and
otherwise supplementing the Mortgage; and
WHEREAS, as of October 15, 1999, Water Company executed and
delivered to Trustee a Twenty-Fifth Supplemental Indenture of Mortgage (herein
called the "Twenty-Fifth Supplemental Indenture") to secure its First Mortgage
0% Bond, Series Z (herein called the "Series Z Bond"), and otherwise
supplementing the Mortgage; and
WHEREAS, as of October 15, 1999, Water Company executed and
delivered to Trustee a Twenty-Sixth Supplemental Indenture of Mortgage (herein
called the "Twenty-Sixth Supplemental Indenture") to secure its First Mortgage
Scheduled Interest Rate Bond, Series AA (herein called the "Series AA Bond"),
and otherwise supplementing the Mortgage; and
WHEREAS, as of October 15, 2001, Water Company executed and
delivered to Trustee a Twenty-Seventh Supplemental Indenture of Mortgage (herein
called the "Twenty-Seventh Supplemental Indenture") to secure its First Mortgage
0% Bond, Series BB (herein called the "Series BB Bond"), and otherwise
supplementing the Mortgage; and
WHEREAS, as of October 15, 2001, Water Company executed and
delivered to Trustee a Twenty-Eighth Supplemental Indenture of Mortgage (herein
called the "Twenty-Eighth Supplemental Indenture") to secure its First Mortgage
Scheduled Interest Rates Bond, Series CC (herein called the "Series CC Bond"),
and otherwise supplementing the Mortgage; and
WHEREAS, as of January 15, 2002, Water Company executed and
delivered to Trustee a Twenty-Ninth Supplemental Indenture of Mortgage (herein
called the "Twenty-Ninth Supplemental Indenture") to secure its First Mortgage
5.10% Bonds, Series DD (herein called the "Series DD Bond"), and otherwise
supplementing the Mortgage; and
WHEREAS, Water Company deems it necessary to borrow money and to
issue its bonds therefor, to be secured by the Mortgage, the Second Supplemental
Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture,
the Fifth Supplemental Indenture, the Sixth Supplemental Indenture, the Seventh
Supplemental Indenture, the Eighth Supplemental Indenture, the Ninth
Supplemental Indenture, the Tenth Supplemental Indenture, the Eleventh
Supplemental Indenture, the Twelfth Supplemental Indenture, the Thirteenth
Supplemental Indenture, the Fourteenth Supplemental Indenture, the Fifteenth
Supplemental Indenture, the Sixteenth Supplemental Indenture, the Seventeenth
Supplemental Indenture, the Supplementary Indenture to the Fifteenth
Supplemental Indenture and the Eighteenth, the Nineteenth, the Twentieth, the
Twenty-First, the Twenty-Second, the Twenty-Third, the Twenty-Fourth, the
Twenty-Fifth, the Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, the
Twenty-Ninth Supplemental Indentures and by this Thirtieth Supplemental
Indenture;
WHEREAS, Water Company desires to authorize and create a series of
bonds under which a single bond shall be issued limited to an aggregate
principal amount of $7,715,909 designated Series EE and to be known as its
"First Mortgage 0% Bond, Series EE" (herein called the "Series EE Bond"), it
being the intention of the parties that the Series EE Bond shall, together with
all other Bonds issued under the Mortgage and all indentures supplemental
thereto, be entitled to priority over all other obligations of the Water Company
and shall be secured by a prior first lien on all the mortgaged property,
subject only to the prior liens specifically permitted under the Mortgage or
under any indenture supplemental thereto; and
WHEREAS, Water Company desires that the Series EE Bond shall be
issued to fund payment of the principal of $7,715,909 the amount of the Loan
borrowed from the from the State of New Jersey, acting by and through the New
Jersey Department of Environmental Protection (the "State") under the Loan
Agreement dated as of November 1, 2004 the "Loan Agreement") by and between the
State and the Water Company, or such lesser amount as shall be determined in
accordance with Section 3.01 of the Loan Agreement, plus any other amounts due
and owing under the Loan Agreement at the time and in the amounts as provided
therein, which principal amount is to be applied for the cleaning and lining of
certain pipes and mains and the spot replacement of water mains, hydrants,
service lines and valves which are utilized by Water Company for the furnishing
of water in its New Jersey service area and construction of a six thousand two
hundred fifty linear foot, sixty inch diameter ductile iron pipeline from its
raw
water pump station in the City of New Brunswick, New Jersey, to the Carl J.
Olsen Water Treatment Plant in the Township of Edison, New Jersey; and
WHEREAS, the State requires as a condition of making the loan
documented by the Loan Agreement, that a single Series EE Bond be issued to the
State, that such Bond evidence the payment obligations of the Water Company
under Section 2.02(m) of the Loan Agreement, that payments under the Series EE
Bond be made to the Loan Servicer (as defined in the Loan Agreement) for the
account of the State, that the Series EE Bond be subject to assignment or
transfer in accordance with the terms of the Loan Agreement, that all of the
terms, conditions and provisions of the Loan Agreement be expressly incorporated
by reference into the Series EE Bond, that the obligations of the Water Company
under the Series EE Bond shall be absolute and unconditional, without any
defense or right of set-off, counterclaim or recoupment by reason of default by
the State under the Loan Agreement or under any other agreement between the
Water Company and the State or out of any indebtedness or liability at any time
owing to the Water Company or for any other reason, that the Series EE Bond be
subject to optional prepayment under the terms and conditions and in the amounts
provided in Section 3.07 of the Loan Agreement, and that the Series EE Bond may
be subject to acceleration under the terms and conditions and in the amounts,
provided in Section 5.03 of the Loan Agreement; and
WHEREAS, Water Company represents that all acts and proceedings
required by law and by the Charter and By-Laws of Water Company, and by the
Mortgage and the Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth,
Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth,
Seventeenth Supplemental Indentures, the Supplementary Indenture to the
Fifteenth Supplemental Indenture, and the Eighteenth, the Nineteenth, the
Twentieth, the Twenty-First, the Twenty-Second, the Twenty-Third, the
Twenty-Fourth, the Twenty-Fifth, the Twenty-Sixth, the Twenty-Seventh, the
Twenty-Eighth, and the Twenty-Ninth Supplemental Indentures (to the extent
applicable) necessary to make the Series EE Bond, when executed by Water
Company, authenticated and delivered by the Trustee, and duly issued, the valid,
binding and legal obligations of Water Company and to constitute this Thirtieth
Supplemental Indenture a valid and binding supplement to the Mortgage and the
Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh,
Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth Supplemental
Indentures, the Supplementary Indenture to the Fifteenth Supplemental Indenture
and the Eighteenth, the Nineteenth, the Twentieth, the Twenty-First, the
Twenty-Second, the Twenty-Third, the Twenty-Fourth, the Twenty-Fifth, the
Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, and the Twenty-Ninth
Supplemental Indentures in accordance with its and their terms, for the security
of all bonds issued and which may hereafter be issued pursuant to the Mortgage
and all indentures supplemental thereto, have been done and performed; and the
execution and delivery of this Thirtieth Supplemental Indenture have been in all
respects duly authorized;
NOW THEREFORE, THIS INDENTURE WITNESSETH, that for and in
consideration of the premises, and of the sum of One Dollar ($1.00), lawful
money of the United States of America, by each of the parties paid to the other,
at or before the delivery hereof, and for other valuable consideration, the
receipt and sufficiency whereof is hereby acknowledged,
Water Company has executed and delivered this Thirtieth Supplemental Indenture,
and has granted, bargained, sold, aliened, enfeoffed, conveyed and confirmed,
and by these presents does grant, bargain, sell, alien, enfeoff, convey and
confirm, unto to the Trustee, its successors and assigns forever, all real
property of Water Company, together with all appurtenances and contracts,
rights, privileges, permits and franchises used or useful in connection with the
business of the Water Company as a water company or as a water utility or used
directly for the purpose of supplying water, granted, bargained, sold, aliened,
enfeoffed, conveyed and confirmed unto the Trustee by the Mortgage and the
Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh,
Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth Supplemental
Indentures, and the Supplementary Indenture to the Fifteenth Supplemental
Indenture and the Eighteenth, the Nineteenth, the Twentieth, the Twenty-First,
the Twenty-Second, the Twenty-Third, the Twenty-Fourth, the Twenty-Fifth, the
Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, and the Twenty-Ninth
Supplemental Indentures, or intended to be (including without limitation all
such property acquired by Water Company since January 15, 2002, and all such
property which Water Company may hereafter acquire), subject, however, to
Permissible Encumbrances, and excepting all Property heretofore released from
the lien of the Mortgage and the indentures supplemental thereto, and excepting
all property of Water Company which is not used or useful in connection with its
business as a water company or as a water utility as well as all personal
property (both tangible and intangible) as to which a security interest may not
be perfected by a filing under the Uniform Commercial Code as in effect in the
State of New Jersey;
TO HAVE AND TO HOLD all and singular the above granted property,
unto the Trustee, its successors and assigns forever, IN TRUST, nevertheless,
for the equal and proportionate use, benefit, security and protection of those
who from time to time shall hold any bonds which have been or may be issued
under the Mortgage or any indenture supplemental thereto, without any
discrimination, preference or priority of any one bond over any other by reason
of priority in the time of issue, sale or negotiation thereof or otherwise,
except as otherwise in the Mortgage or in any indenture supplemental thereto
provided; and in trust for enforcing the payment of the principal of and the
interest on such bonds, according to the tenor, purport and effect of the bonds
and of the Mortgage and all indentures supplemental thereto and for enforcing
the terms, provisions, covenants and stipulations therein and in the bonds set
forth; and upon the trust, uses and purposes and subject to the covenants,
agreements and conditions set forth and declared in the Mortgage as modified,
amended and supplemented by all indentures supplemental thereto;
AND the parties do hereby covenant and agree that the Mortgage and
the Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth,
Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth
Supplemental Indentures, the Supplementary Indenture to the Fifteenth
Supplemental Indenture and the Eighteenth, the Nineteenth, the Twentieth, the
Twenty-First, the Twenty-Second, the Twenty-Third, the Twenty-Fourth, the
Twenty-Fifth, the Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth and the
Twenty-Ninth Supplemental Indentures be and hereby are supplemented as
hereinafter provided, and that the above granted property is to be held and
applied subject to the covenants, conditions, uses and
trusts set forth in the Mortgage, as modified, amended and supplemented by such
Supplemental Indentures and this Thirtieth Supplemental Indenture; and Water
Company for itself and its successors does hereby covenant and agree to and with
the Trustee, and its successors in said trust, for the equal benefit of all
present and future holders and registered owners of the bonds issued under the
Mortgage and all indentures supplemental thereto, as follows:
ARTICLE I
First Mortgage 0% Bonds, Series EE
Section 1. Water Company hereby creates a series of bonds to be
issued under and secured by the Mortgage, the Second, Third, Fourth, Fifth,
Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth,
Fifteenth, Sixteenth, and Seventeenth Supplemental Indentures, the Supplementary
Indenture to the Fifteenth Supplemental Indenture, the Eighteenth, the
Nineteenth, the Twentieth, the Twenty-First, the Twenty-Second, the
Twenty-Third, the Twenty-Fourth, the Twenty-Fifth, the Twenty-Sixth, the
Twenty-Seventh, the Twenty-Eighth and the Twenty-Ninth Supplemental Indentures
and by this Thirtieth Supplemental Indenture, and to be designated as, and to be
distinguished from the bonds of all other series by the title, "First Mortgage
0% Bonds, Series EE". The Series EE Bond shall be issued only as a single
registered bond without coupons in the principal amount of the Loan under the
Loan Agreement; shall be dated as of November 1, 2004; and shall be issued in
non-negotiable form to the State. The Series EE Bond shall bear interest from
the date of issuance of the Series EE Bond, computed on the basis of a 360-day
year composed of twelve 30-day months until the obligations of the Water Company
with respect to the payment of principal shall be discharged, in the dollar
amount set forth for each respective payment period under the column heading
"Interest" in Exhibit A-2 to the Loan Agreement, shall be payable as set forth
below, shall state that, subject to certain limitations, the Mortgage and all
indentures supplemental thereto may be modified, amended or supplemented as
provided in the Mortgage as heretofore supplemented; shall mature on November 1,
2024, and shall be earlier redeemable (i) under the terms and conditions and in
the amounts provided in Section 3.07 of the Loan Agreement at the option of the
Water Company with, to the extent required by the July 8, 2004 Order (Docket No.
WF04050341 of the Board of Public Utilities of the State of New Jersey ("BPU")
and/or required by then applicable law and regulations, the prior approval of
the BPU, (ii) as, when and to the extent mandated pursuant to subsection B of
Section 4 of Article VIII of the Second Supplemental Indenture; and shall be
subject to, entitled to the benefit of, and expressly incorporate by reference,
all of the terms, conditions and provisions of the Loan Agreement.
The Series EE Bond shall evidence the obligation to pay to the order
of the State the principal amount of the Loan (as defined in the Loan Agreement)
made by the State under the Loan Agreement which shall be $7,715,909, or such
lesser amount as determined in accordance with Section 3.01 of the Loan
Agreement, at the times and in the amounts determined as provided in the Loan
Agreement, plus any other amounts due and owing under the Loan Agreement at the
times and in the amounts as provided therein. The obligations of the Water
Company to make payments under the Series EE Bond are absolute and
unconditional, without any defense or right of set-off, counterclaim or
recoupment by reason of any default by the State under the Loan Agreement or
under any other agreement between the Water Company and the State or out of any
indebtedness or liability at any time owing to the Water Company by the State or
for any other reason. The Series EE Bond is subject to assignment or transfer in
accordance with the terms of the Loan Agreement. The Series EE Bond is subject
to acceleration under the terms and conditions, and in the amounts, provided in
Section 5.03 of the Loan Agreement. Payments under the Series EE Bond shall,
except as otherwise provided in the Loan Agreement, be made directly to the Loan
Servicer (as defined in the Loan Agreement), for the account of the State.
In addition to any other default provided for under the Mortgage and the
Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh,
Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth and Seventeenth,
Supplemental Indentures and the Supplementary Indenture to the Fifteenth
Supplemental Indenture and the Eighteenth, the Nineteenth, the Twentieth, the
Twenty-First, the Twenty-Second, the Twenty-Third, Twenty-Fourth, the
Twenty-Fifth, the Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, and the
Twenty-Ninth Supplemental Indentures, it shall be a default under this Thirtieth
Supplemental Indenture if payment of any of the principal or of the Interest on
the Loan constituting the Interest Portion, the Administrative Fee and any late
charges incurred under the Loan Agreement (as such terms are defined in the Loan
Agreement) is not made when the same shall become due and payable in
installments, at maturity, upon redemption or otherwise.
Section 2. Disbursements of the proceeds of the Loan from the State
under the Loan Agreement evidenced by the Series EE Bond shall be made by the
State to the Water Company upon receipt by the State of requisitions from the
Water Company executed and delivered in accordance with the requirements set
forth in Section 3.02 of the Loan Agreement.
Section 3. The Series EE Bond and the certificate of authentication
of the Trustee to be executed thereon shall be substantially in the form
prescribed for registered bonds without coupons in the Second Supplemental
Indenture (except that there may be deleted therefrom all references to the
issuance of coupon bonds in exchange therefor); shall be in the form attached to
this Thirtieth Supplemental Indenture as Exhibit A; and shall contain
appropriate references to this Thirtieth Supplemental Indenture in addition to
the Mortgage and the Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth,
Ninth, Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth
and Seventeenth Supplemental Indentures and the Supplementary Indenture to the
Fifteenth Supplemental Indenture and the Eighteenth, the Nineteenth, the
Twentieth, the Twenty-First, the Twenty-Second, the Twenty-Third, the
Twenty-Fourth, the Twenty-Fifth, the Twenty-Sixth, the Twenty-Seventh, the
Twenty-Eighth, and the Twenty-Ninth Supplemental Indentures and appropriate
changes with respect to the aggregate principal amount, interest rate,
redemption dates and provisions, and maturity date of the Series EE Bond, and
with appropriate reference to the provision of the Fourth Supplemental Indenture
that, subject to certain limitations, the Mortgage and all indentures
supplemental thereto may be modified, amended or supplemented
only as provided in the Mortgage and except that the Series EE Bond shall not
contain any references to a sinking fund.
Section 4. Subject to the provisions of the Mortgage and the Second,
Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh, Twelfth,
Thirteenth, Fourteenth, Fifteenth, Sixteenth and Seventeenth Supplemental
Indentures, the Supplementary Indenture to the Fifteenth Supplemental Indenture
and the Eighteenth, the Nineteenth, the Twentieth, the Twenty-First, the
Twenty-Second, the Twenty-Third, the Twenty-Fourth, the Twenty-Fifth, the
Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, and the Twenty-Ninth
Supplemental Indentures, forthwith upon the execution and delivery of this
Thirtieth Supplemental Indenture, or from time to time thereafter, Series EE
Bond in an aggregate principal amount of $7,715,909 may be executed by Water
Company and delivered to the Trustee for authentication and shall thereupon be
authenticated and delivered by the Trustee upon the written order of Water
Company, signed by its President or a Vice President and its Treasurer or
Assistant Treasurer, in such denominations and registered in such name or names
as may be specified in such written order.
Section 5. Sections 4(A)(iii) and (iv) of Article VIII of the Second
Supplemental Indenture shall not be available to the Water Company with respect
to the Series EE Bond. The Water Company shall issue its written order under
Section 4(a)(i) or (ii), as the case may be, reasonably promptly after receipt
by the Trustee of proceeds of sale, eminent domain or insurance (not otherwise
to be paid directly to the Company under the Mortgage as supplemented by the
Supplemental Indentures including this Thirtieth Supplemental Indenture).
ARTICLE II
Miscellaneous
-------------
Section 1. The provisions of the Mortgage as modified, amended and supplemented
by the Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth,
Ninth, Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth,
Fifteenth, Sixteenth and Seventeenth Supplemental Indentures,
the Supplementary Indenture to the Fifteenth Supplemental
Indenture and the Eighteenth, the Nineteenth, the Twentieth,
the Twenty-First, the Twenty-Second, the Twenty-Third, the
Twenty-Fourth, the Twenty-Fifth, the Twenty-Sixth, the
Twenty-Seventh, the Twenty-Eighth, and the Twenty-Ninth
Supplemental Indentures, and as modified and extended by this
Thirtieth Supplemental Indenture are hereby reaffirmed. Except
insofar as they are inconsistent with the provisions hereof,
the provisions of the Mortgage and the Second, Third, Fourth,
Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh,
Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth and
Seventeenth Supplemental Indentures and the Supplementary
Indenture to the Fifteenth Supplemental Indenture and the
Eighteenth, the Nineteenth, the Twentieth, the
Twenty-First, the Twenty-Second, the Twenty-Third, the
Twenty-Fourth, the Twenty-Fifth, the Twenty-Sixth, the
Twenty-Seventh, the Twenty-Eighth, and the Twenty-Ninth
Supplemental Indentures with respect to the Series C, Series
D, Series E, Series F, Series G, Series H, Series I, Series J,
Series K, Series L, Series M, Series N, Series O, Series P,
Series Q, Series R, Series P-1, Series S, Series T, Series U,
Series V, Series W, Series X, Series Y, Series Z, Series AA,
Series BB, Series CC and Series DD Bonds shall apply to the
Series EE Bond to the same extent as if they were set forth
herein in full. Unless there is something in the subject or
context repugnant to such construction, each reference in the
Mortgage and the Second, Third, Fourth, Fifth, Sixth, Seventh,
Eighth, Ninth, Tenth, Eleventh, Twelfth, Thirteenth,
Fourteenth, Fifteenth, Sixteenth and Seventeenth Supplemental
Indentures, the Supplementary Indenture to the Fifteenth
Supplemental Indenture and the Eighteenth, the Nineteenth, the
Twentieth, the Twenty-First, the Twenty-Second, the
Twenty-Third, the Twenty-Fourth, the Twenty-Fifth, the
Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, and the
Twenty-Ninth Supplemental Indentures to the Mortgage or any of
such Supplemental Indentures shall be construed as also
referring to this Thirtieth Supplemental Indenture. The
Mortgage and all indentures supplemental thereto may be
modified, amended or supplemented by Water Company with prior
notice by the Water Company to but without the consent of any
of the bondholders to accomplish any more of the following:
(1) to cure any ambiguity, supply any omission, or cure or correct
any defect or inconsistent provision in the Mortgage or any
indenture supplemental thereto;
(2) to cure any ambiguity, supply any omission, or cure or correct
any defect in any description of the Mortgaged Property, if
such action is not adverse to the interests of the bondholder;
(3) to insert such provisions clarifying matters or questions
arising under the Mortgage or any indenture supplemental
thereto as are necessary or desirable and are not contrary to
or inconsistent with the Mortgage or any indenture
supplemental thereto as in effect; or
(4) to restate the Mortgage as supplemented by the Supplemental
Indentures as a single integrated document which may add
headings, an index and other provisions aiding the convenience
of use.
The terms and provisions of the Series EE Bond shall not be amended by, and the
Series EE Bond shall not be entitled to the benefit of any covenant, term or
condition contained in any subsequent supplemental indenture without the express
written concurrence of the Water Company.
Section 2. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity and sufficiency of this Thirtieth
Supplemental Indenture or the due execution hereof by Water Company or for the
recitals contained herein, all of which recitals are made by Water Company
solely.
Section 3. The Trustee hereby accepts the trusts hereby declared and
provided and agrees to perform the same upon the terms and conditions in the
Mortgage, the Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth,
Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth and
Seventeenth Supplemental Indentures, the Supplementary Indenture to the
Fifteenth Supplemental Indenture, the Eighteenth, the Nineteenth, Twentieth, the
Twenty-First, the Twenty-Second, the Twenty-Third, the Twenty-Fourth, the
Twenty-Fifth, the Twenty-Sixth, the Twenty-Seventh, the Twenty-Eighth, the
Twenty-Ninth and this Thirtieth Supplemental Indenture set forth. The Trustee
also hereby agrees to execute and deliver the Escrow Agreement (as defined in
the Loan Agreement).
Section 4. The Trustee hereby authorizes the Loan Servicer to accept
payments made by Water Company of principal of the Series EE Bond for the
account of the State.
Section 5. This Thirtieth Supplemental Indenture has been executed
simultaneously in several counterparts and all of said counterparts executed and
delivered, each as an original, shall constitute one and the same instrument.
Section 6. Although this Thirtieth Supplemental Indenture, for
convenience and for the purpose of reference, is dated as of October 15, 2004,
the actual date of execution by Water Company and the Trustee is as shown by
their respective acknowledgments hereto annexed, and the actual date of delivery
hereof by Water Company and the Trustee is the date of the closing of the sale
of the Series EE Bonds by Water Company.
Section 7. In any case where the payment of principal of the Series
EE Bond or the date fixed for redemption of any Series EE Bond shall be a
Saturday or Sunday or a legal holiday or a day on which banking institutions in
the City of the principal corporate trust office of the Loan Servicer is located
are authorized by law to close, then payment of interest or principal or
redemption price need not be made on such date but may be made on the next
proceeding business day with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest on such payment shall
accrue after such date.
THE MORTGAGOR HEREBY DECLARES AND ACKNOWLEDGES THAT IT HAS RECEIVED,
WITHOUT CHARGE, A TRUE COPY OF THIS MORTGAGE.
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