Document:

Exhibit 10.44

[

 

 

 

 

LOAN AGREEMENT

BY AND BETWEEN

NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE
TRUST

AND

MIDDLESEX WATER COMPANY

 

 

 

 

DATED AS OF MAY 1, 2012

    	 

    	 

    

 

	 	TABLE OF CONTENTS	 
	 	 	 
	 	 	Page
	 
 ARTICLE I
	DEFINITIONS
  
	SECTION 1.01.	Definitions.	2
	 
 ARTICLE II
  
	REPRESENTATIONS AND COVENANTS OF BORROWER
  
	SECTION 2.01.	Representations of Borrower	6
	SECTION 2.02.	Particular Covenants of Borrower.	10
	 
 ARTICLE III
  
	LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS
  
	SECTION 3.01.	Loan; Loan Term	19
	SECTION 3.02.	Disbursement of Loan Proceeds.	19
	SECTION 3.03.	Amounts Payable.	20
	SECTION 3.03A.	Amounts on Deposit in Project Loan Account After Completion of Project Draws.	21
	SECTION 3.04.	Unconditional Obligations	22
	SECTION 3.05.	Loan Agreement to Survive Bond Resolution and Trust Bonds	23
	SECTION 3.06.	Disclaimer of Warranties and Indemnification.	24
	SECTION 3.07.	Option to Prepay Loan Repayments	25
	SECTION 3.08.	Priority of Loan and Fund Loan.	25
	SECTION 3.09.	Approval of the New Jersey State Treasurer	26
	 
 ARTICLE IV
  
	ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND
  
	SECTION 4.01.	Assignment and Transfer by Trust.	27
	SECTION 4.02.	Assignment by Borrower	27
	 
 ARTICLE V
  
	EVENTS OF DEFAULT AND REMEDIES
  
	SECTION 5.01.	Events of Default	28
	SECTION 5.02.	Notice of Default	29
	SECTION 5.03.	Remedies on Default	29

 

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	 	TABLE OF CONTENTS	 
	 	 	 
	 	 	Page
	 	  	 
	SECTION 5.04.	Attorneys’ Fees and Other Expenses	30
	SECTION 5.05.	Application of Moneys	29
	SECTION 5.06.	No Remedy Exclusive; Waiver; Notice	29
	SECTION 5.07.	Retention of Trust’s Rights	1
	 
 ARTICLE VI
  
	MISCELLANEOUS
  
	SECTION 6.01.	Notices	1
	SECTION 6.02.	Binding Effect	1
	SECTION 6.03.	Severability	1
	SECTION 6.04.	Amendments, Supplements and Modifications.	1
	SECTION 6.05.	Execution in Counterparts	1
	SECTION 6.06.	Applicable Law and Regulations	1
	SECTION 6.07.	Consents and Approvals	1
	SECTION 6.08.	Captions	1
	SECTION 6.09.	Benefit of Loan Agreement; Compliance with Bond Resolution	1
	SECTION 6.10.	Further Assurances	1
	 	 	 
	 	 	 

 

	SCHEDULE A	Certain Additional Loan Agreement Provisions	S-1
	 	 	 
	EXHIBIT A	(1) Description of Project and Environmental Infrastructure System	A-1
	 	(2) Description of Loan	A-2
	 	 	 
	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 Counsel and General Counsel	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 TRUST LOAN AGREEMENT

THIS LOAN AGREEMENT,
made and entered into as of May 1, 2012, by and between the NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST, a public body corporate
and politic with corporate succession, 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 Trust, in accordance with the Act, the Bond Resolution and a financial plan approved by the State Legislature in accordance
with Sections 22 and 22.1 of the Act, will issue its Trust Bonds on or prior to the Loan Closing for the purpose of making the
Loan to the Borrower and the Loans to the Borrowers from the proceeds of the Trust Bonds to finance a portion of the Costs of Environmental
Infrastructure Facilities;

WHEREAS,
the Borrower has, in accordance with the Act and the Regulations, made timely application to the Trust for a Loan to finance a
portion of the Costs of the Project;

WHEREAS,
the State Legislature, in accordance with Sections 20 and 20.1 of the Act, has in the form of an appropriations act approved a
project priority list that includes the Project and that authorizes an expenditure of proceeds of the Trust Bonds to finance a
portion of the Costs of the Project;

WHEREAS,
the Trust has approved the Borrower’s application for a Loan from available proceeds of the Trust Bonds to finance a portion
of the Costs of the Project;

WHEREAS,
in accordance with the applicable Bond Act (as defined in the Fund Loan Agreement), and the Regulations, the Borrower has been
awarded a Fund Loan for a portion of the Costs of the Project; and

WHEREAS,
the Borrower, in accordance with the Act, the Regulations, the Business Corporation Law and all other applicable law, will issue
a Borrower Bond to the Trust evidencing said Loan at the Loan Closing.

NOW, THEREFORE,
for and in consideration of the award of the Loan by the Trust, 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.

(a)          The
following terms as used in this Loan Agreement shall, unless the context clearly requires otherwise, have the following meanings:

“Act”
means the “New Jersey Environmental Infrastructure Trust Act”, constituting Chapter 334 of the Pamphlet Laws of 1985
of the State (codified at N.J.S.A. 58:11B-1 et seq.), as the same may from time to time be amended and supplemented.

“Administrative
Fee” means that portion of Interest on the Loan or Interest on the Borrower Bond payable hereunder as an annual fee of
up to four-tenths of one percent (.40%) of the initial principal amount of the Loan or such lesser amount, if any, as may be authorized
by any act of the State Legislature and as the Trust 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
directorsof the Borrower to perform any act or execute any document relating to the Loan, the Borrower Bond or this Loan Agreement.

“Bond Counsel”
means a law firm appointed or approved by the Trust, as the case may be, having a reputation in the field of municipal law whose
opinions are generally acceptable by purchasers of municipal bonds.

"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 Trust and, if applicable, authenticated 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 Trust pursuant to
which the Trust will make Loans to such recipients from moneys on deposit in the Project Fund, excluding the Project Loan Account.

“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.

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“Costs”
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 Trust.

“Debt Service
Reserve Fund” means the Debt Service Reserve Fund, if any, as defined in the Bond Resolution.

“Department”
means the New Jersey Department of Environmental Protection

“Environmental
Infrastructure Facilities” means Water Supply Facilities (as such terms are defined in the Regulations).

“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.

“Excess
Project Funds” shall have the meaning set forth in Section 3.03A hereof.

“Fund Loan”
means the loan made to the Borrower by the State, acting by and through the Department, pursuant to the Fund Loan Agreement dated
as of May 1, 2012 by and between the Borrower and the State, acting by and through the Department, to finance or refinance a portion
of the Costs of the Project.

“Fund Loan
Agreement” means the loan agreement dated as of May 1, 2012 by and between the Borrower and the State, acting by and
through the Department, regarding the terms and conditions of the Fund Loan.

“Interest
on the Loan” or “Interest on the Borrower Bond” means the sum of (i) the Interest Portion, (ii) the
Administrative Fee, and (iii) any late charges incurred hereunder.

“Interest
Portion” means that portion of Interest on the Loan or Interest on the Borrower Bond payable hereunder that is necessary
to pay the Borrower’s proportionate share of interest on the Trust Bonds (i) as set forth in Exhibit A-2 hereof under the
column heading entitled “Interest”, or (ii) with respect to any prepayment of Trust Bond Loan Repayments in accordance
with Section 3.07 or 5.03 hereof, to accrue on any principal amount of Trust Bond Loan Repayments to the date of the optional redemption
or acceleration, as the case may be, of the Trust Bonds allocable to such prepaid or accelerated Trust Bond Loan Repayment.

“Loan”
means the loan made by the Trust to the Borrower to finance or refinance a portion of the Costs of the Project pursuant to this
Loan Agreement, as further described in Schedule A attached hereto.

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“Loan Agreement”
means this Loan Agreement, including Schedule A and the Exhibits attached hereto, as it may be supplemented, modified or amended
from time to time in accordance with the terms hereof and of the Bond Resolution.

“Loan Agreements”
means any other loan agreements entered into by and between the Trust and one or more of the Borrowers pursuant to which the Trust
will make Loans to such Borrowers from moneys on deposit in the Project Fund, excluding the Project Loan Account, financed with
the proceeds of the Trust Bonds.

“Loan Closing”
means the date upon which the Trust shall issue and deliver the Trust Bonds and the Borrower shall deliver its Borrower Bond, as
previously authorized, executed, attested and, if applicable, authenticated, to the Trust.

“Loan Repayments”
means the sum of (i) Trust Bond Loan Repayments, (ii) the Administrative Fee, and (iii) any late charges incurred hereunder.

“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 Trust to the Borrowers under the Loan Agreements from moneys on deposit in the Project Fund, excluding
the Project Loan Account.

“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 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.

“Official
Statement” means the Official Statement relating to the issuance of the Trust Bonds.

“Preliminary
Official Statement” means the Preliminary Official Statement relating to the issuance of the Trust Bonds.

“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 Trust is permitted to make a loan to the Borrower pursuant to the Act, the Regulations
and the Bond Resolution, all or a portion of the Costs of which is financed or refinanced by the Trust through the making of the
Loan under this Loan Agreement and which may be identified under 

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either the Drinking Water or Clean Water Project Lists with the
Project Number specified in Exhibit A-1 attached hereto.

“Project
Fund” means the Project Fund as defined in the Bond Resolution.

“Project
Loan Account” means the project loan account established on behalf of the Borrower in the Project Fund in accordance
with the Bond Resolution to finance all or a portion of the Costs of the Project.

“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., 7:22-6 et seq., 7:22-7 et seq., 7:22-8 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.

“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 the Act.

“Trust
Bond Loan Repayments” means the repayments of the principal amount of the Loan plus the payment of any premium associated
with prepaying the principal amount of the Loan in accordance with Section 3.07 hereof plus the Interest Portion.

“Trust
Bonds” means bonds authorized by Section 2.03 of the Bond Resolution, together with any refunding bonds authenticated,
if applicable, and delivered pursuant to Section 2.04 of the Bond Resolution, in each case issued in order to finance (i) the portion
of the Loan deposited in the Project Loan Account, (ii) the portion of the Loans deposited in the balance of the Project Fund,
(iii) any capitalized interest related to such bonds, (iv) a portion of the costs of issuance related to such bonds, and (v) that
portion of the Debt Service Reserve Fund (to the extent the Trust establishes a Debt Service Reserve Fund pursuant to the Bond
Resolution), if any, allocable to the Loan or Loans, as the case may be, a portion of which includes the funding of reserve capacity,
if applicable, for the Environmental Infrastructure Facilities of the Borrower or Borrowers, as the case may be, or to refinance
any or all of the above.

“Trustee”
means, initially, U.S. 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.

(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 Trust, the Trustee and the holders of the Trust Bonds as follows:

(a)          Organization
and Authority.

(i)          The
Borrower is a corporation duly created and validly existing under and pursuant to the Constitution and statutes 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 State 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
Trust, 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 Trust,
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 State 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 Trust upon the terms set forth herein; (C) the 

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approval of the inclusion,
if such inclusion is deemed necessary in the sole discretion of the Trust, in the Preliminary Official Statement and the Official
Statement of all statements and information relating to the Borrower set forth in “APPENDIX B” thereto (the “Borrower
Appendices”) and any amendment thereof or supplement thereto; and (D) 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, including, without limitation,
the designation of the Borrower Appendices portion of the Preliminary Official Statement, if any, as “deemed final”
for the purposes and within the meaning of Rule 15c2-12 (“Rule 15c2-12”) of the Securities and Exchange Commission
(“SEC”) promulgated under the Securities Exchange Act of 1934, as amended or supplemented, including any successor
regulation or statute thereto.

(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 Trust, 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 Trust 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 Trust, enforceable against the Trust 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 Trust 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 and any other payments required under this Loan Agreement 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
or any other payments required under this Loan Agreement, (iv) the authorization, execution, attestation or 

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delivery of this Loan
Agreement or the Borrower Bond, (v) the issuance of the Borrower Bond and the sale thereof to the Trust, (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 Trust 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 Borrower Bond
Resolution, as the case may be, and the sale of the Borrower Bond to the Trust, (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 Trust, 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 Trust, for the adoption of the Borrower Bond Resolution, for the 

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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
Trust, as required by Section 9a of the Act, 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 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 Trust, the undertaking or completion of the Project or the consummation of any transaction herein contemplated.

(g)          Compliance
with Law. The Borrower:

(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 Trust as described in Exhibit B attached hereto and
made a part hereof (i) to finance or refinance a portion of the Costs of the Borrower’s Project; and (ii) where applicable,
to reimburse the Borrower for a portion of the Costs of the Borrower’s Project, which portion was paid or incurred in anticipation
of reimbursement by the Trust 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 Trust is authorized to make Loans to the Borrower pursuant to
the Act and the Regulations.

(i)          Official
Statement. The descriptions and information set forth in the Borrower Appendices, if any, contained in the Official Statement
relating to the Borrower, its operations and the transactions contemplated hereby, as of the date of the Official Statement, were
and, as of the date of delivery hereof, are true and correct in all material respects, and did not and do not 

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contain any untrue
statement of a material fact or omit to state a material fact that is necessary to make the statements contained therein, in light
of the circumstances under which they were made, not misleading.

(j)          Preliminary
Official Statement. As of the date of the Preliminary Official Statement, the descriptions and information set forth in the
Borrower Appendices, if any, contained in the Preliminary Official Statement relating to the Borrower, its operations and the transactions
contemplated hereby (i) were “deemed final” by the Borrower for the purposes and within the meaning of Rule 15c2-12
and (ii) were true and correct in all material respects, and did not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements contained therein, in light of the circumstances under which they were made,
not misleading.

SECTION
2.02.          Particular Covenants of Borrower.

(a)          Promise
to Pay. The Borrower unconditionally and irrevocably promises in accordance with the terms of and to the extent provided in
the Borrower Bond Resolution, to make punctual payment of the principal and redemption premium, if any, of the Loan and the Borrower
Bond, the Interest on the Loan, the Interest on 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 Trust in the observance and performance of the respective duties, covenants,
obligations and agreements of the Borrower and the Trust under 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)          Borrower
Bond; No Prior Liens. Except for (i) the Borrower Bond, (ii) any bonds or notes at parity with the Borrower Bond and currently
outstanding or issued on the date hereof, (iii) any future bonds or notes of the Borrower issued under the Borrower Bond Resolution
at parity with the Borrower Bond, and (iv) any Permitted Encumbrances (as defined in the Borrower Bond Resolution), the assets
of the Borrower that are subject to the Borrower Bond Resolution 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 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 

    	-10-

    	 

    
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 Fund 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)          Exclusion
of Interest from Federal Gross Income and Compliance with Code.

(i)          The
Borrower covenants and agrees that it shall not take any action or omit to take any action that would result in the loss of the
exclusion of the interest on any Trust Bonds now or hereafter issued from gross income for purposes of federal income taxation
as that status is governed by Section 103(a) of the Code.

(ii)          The
Borrower shall not directly or indirectly use or permit the use of any proceeds of the Trust Bonds (or amounts replaced with such
proceeds) or any other funds or take any action or omit to take any action that would cause the Trust Bonds (assuming solely for
this purpose that the proceeds of the Trust Bonds loaned to the Borrower represent all of the proceeds of the Trust Bonds) to be
“arbitrage bonds” within the meaning of Section 148(a) of the Code.

(iii)          The
Borrower shall not directly or indirectly use or permit the use of any proceeds of the Trust Bonds to pay the principal of or the
interest or redemption premium on or any other amount in connection with the retirement or redemption of any issue of state or
local governmental obligations (“refinancing of indebtedness”), unless the Borrower shall (A) establish to the satisfaction
of the Trust, prior to the issuance of the Trust Bonds, that such refinancing of indebtedness will not adversely affect the exclusion
from gross income for federal income tax purposes of the interest on the Trust Bonds, and (B) provide to the Trust an opinion of
Bond Counsel to that effect in form and substance satisfactory to the Trust.

(iv)          The
Borrower shall not directly or indirectly use or permit the use of any proceeds of the Trust Bonds to reimburse the Borrower for
an expenditure with respect to a Costs of the Borrower’s Project paid by the Borrower prior to the issuance of the Trust
Bonds, unless (A) the allocation by the Borrower of the proceeds of the Trust Bonds to reimburse such expenditure complies with
the requirements of Treasury Regulations §1.150-2 necessary to enable the reimbursement allocation to be treated as an expenditure
of the proceeds of the Trust Bonds for purposes of applying Sections 103 and 141-150, inclusive, of the Code, or (B) such proceeds
of the Trust Bonds will be used for refinancing of indebtedness that was used to pay Costs of the Borrower’s Project or to
reimburse the Borrower for expenditures with respect to Costs of the Borrower’s Project paid by the Borrower prior to the
issuance of such indebtedness in accordance with a reimbursement allocation for such expenditures that complies with the requirements
of Treasury Regulations §1.150-2.

    	-11-

    	 

    

(v)          The
Borrower shall not directly or indirectly use or permit the use of any proceeds of the Trust Bonds to pay any costs which are not
Costs of the Borrower’s Project that constitute a “capital expenditure” within the meaning of Treasury Regulations
§1.150-1.

(vi)          The
Borrower shall not use the proceeds of the Trust Bonds (assuming solely for this purpose that the proceeds of the Trust Bonds loaned
to the Borrower represent all of the proceeds of the Trust Bonds) in any manner that would cause the Trust Bonds to be considered
“federally guaranteed” within the meaning of Section 149(b) of the Code or “hedge bonds” within the meaning
of Section 149(g) of the Code.

(vii)          The
Borrower shall not issue any debt obligations that (A) are sold at substantially the same time as the Trust Bonds and finance or
refinance the Loan made to the Borrower, (B) are sold pursuant to the same plan of financing as the Trust Bonds and finance or
refinance the Loan made to the Borrower, and (C) are reasonably expected to be paid out of substantially the same source of funds
as the Trust Bonds and finance or refinance the Loan made to the Borrower.

(viii)          Neither
the Borrower nor any “related party” (within the meaning of Treasury Regulations §1.150-1) shall purchase Trust
Bonds in an amount related to the amount of the Loan.

(ix)          The
Borrower will not issue or permit to be issued obligations that will constitute an “advance refunding” of the Borrower
Bond within the meaning of Section 149(d)(5) of the Code without the express written consent of the Trust, which consent may only
be delivered by the Trust after the Trust has received notice from the Borrower of such contemplated action no later than sixty
(60) days prior to any such contemplated action, and which consent is in the sole discretion of the Trust.

(x)          See
Section 2.02(f)(xi) as set forth in Schedule A attached hereto, made a part hereof and incorporated in this Section 2.02(f)(xi)
by reference as if set forth in full herein.

(xi)          No
“gross proceeds” of the Trust Bonds held by the Borrower (other than amounts in a “bona fide debt service fund”)
will be held in a “commingled fund” (as such terms are defined in Treasury Regulations §1.148-1(b)).

(xii)          Based
upon all of the objective facts and circumstances in existence on the date of issuance of the Trust Bonds used to finance the Project,
(A) within six months of the date of issuance of the Trust Bonds used to finance the Project, the Borrower will incur a substantial
binding obligation to a third party to expend on the Project at least five percent (5%) of the “net sale proceeds”
(within the meaning of Treasury Regulations §1.148-1) of the Loan used to finance the Project (treating an obligation as not
being binding if it is subject to contingencies within the control of the Borrower, the Trust or a “related party”
(within the meaning of Treasury Regulations §1.150-1)), (B) completion of the Project and the allocation to expenditures of
the “net sale proceeds” of the Loan used to finance the Project will proceed with due diligence, and (C) all of the
proceeds of 

    	-12-

    	 

    
the Loan used to finance the Project (other than amounts deposited into the Debt Service Reserve Fund (to the extent
the Trust establishes a Debt Service Reserve Fund pursuant to the Bond Resolution) allocable to that portion of the Loan used to
finance reserve capacity, if any) and investment earnings thereon will be spent prior to the period ending three (3) years subsequent
to the date of issuance of the Trust Bonds used to finance the Project. Accordingly, the proceeds of the Loan deposited in the
Project Loan Account used to finance the Project will be eligible for the 3-year arbitrage temporary period since the expenditure
test, time test and due diligence test, as set forth in Treasury Regulations §1.148-2(e)(2), will be satisfied.

(xiii)          The
weighted average maturity of the Loan does not exceed 120% of the average reasonably expected economic life of the Project financed
or refinanced with the Loan, determined in the same manner as under Section 147(b) of the Code. Accordingly, the term of the Loan
will not be longer than is reasonably necessary for the governmental purposes of the Loan within the meaning of Treasury Regulations
§1.148-1(c)(4).

(xiv)          The
Borrower shall, within 30 days of date the Borrower concludes that no additional proceeds of the Loan will be required to pay costs
of the Project, provide to the Trust a certificate of the Borrower evidencing such conclusion.

For purposes of
this subsection and subsection (h) of this Section 2.02, quoted terms shall have the meanings given thereto by Section 148 of the
Code, including, particularly, Treasury Regulations §§1.148-1 through 1.148-11, inclusive, as supplemented or amended,
to the extent applicable to the Trust Bonds, and any successor Treasury Regulations applicable to the Trust Bonds.

(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 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.

(i)          The
Borrower shall keep accurate records and accounts for its Environmental Infrastructure System (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 Trust 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 Trust 

    	-13-

    	 

    
within 150 days of the close of the fiscal year being so audited or, with the consent of the Trust, such
additional period as may be provided by law.

(ii)          Within
30 days following receipt of any Loan proceeds, including without limitation the “Allowance for Administrative Costs”
or the “Allowance for Planning and Design” set forth in Exhibit B hereto, the Borrower shall allocate such proceeds
to an expenditures in a manner that satisfies the requirements of Treasury Regulation §1.148-6(d) and transmit a copy of each
such allocation to the Trust. No portion of the Allowance for Administrative Costs will be allocated to a cost other than a cost
described in N.J.A.C. 7:22-5.11(a) 3, 4 or 6. No portion of the Allowance for Planning and Design will be allocated to a cost other
than a cost described N.J.A.C. 7:22-5.12, or other costs of the Borrower’s Environmental Infrastructure System which are
“capital expenditures,” within the meaning of Treasury Regulations §1.150-1. The Borrower shall retain records
of such allocations for at least until the date that is three years after the scheduled maturity date of the Trust Bonds. The Borrower
shall make such records available to the Trust within 15 days of any request by the Trust.

(iii)          Unless
otherwise advised in writing by the Trust, in furtherance of the covenant of the Borrower contained in subsection (f) of this Section
2.02 not to cause the Trust Bonds to be arbitrage bonds, the Borrower shall keep, or cause to be kept, accurate records of each
investment it makes in any “nonpurpose investment” acquired with, or otherwise allocated to, “gross proceeds”
of the Trust Bonds not held by the Trustee and each “expenditure” it makes allocated to “gross proceeds”
of the Trust Bonds. Such records shall include the purchase price, including any constructive “payments” (or in the
case of a “payment” constituting a deemed acquisition of a “nonpurpose investment” (e.g., a “nonpurpose
investment” first allocated to “gross proceeds” of the Trust Bonds after it is actually acquired because it is
deposited in a sinking fund for the Trust Bonds)), the “fair market value” of the “nonpurpose investment”
on the date first allocated to the “gross proceeds” of the Trust Bonds, nominal interest rate, dated date, maturity
date, type of property, frequency of periodic payments, period of compounding, yield to maturity, amount actually or constructively
received on disposition (or in the case of a “receipt” constituting a deemed disposition of a “nonpurpose investment”
(e.g., a “nonpurpose investment” that ceases to be allocated to the “gross proceeds” of the Trust Bonds
because it is removed from a sinking fund for the Trust Bonds)), the “fair market value” of the “nonpurpose investment”
on the date it ceases to be allocated to the “gross proceeds” of the Trust Bonds, the purchase date and disposition
date of the “nonpurpose investment” and evidence of the “fair market value” of such property on the purchase
date and disposition date (or deemed purchase or disposition date) for each such “nonpurpose investment”. The purchase
date, disposition date and the date of determination of “fair market value” shall be the date on which a contract to
purchase or sell the “nonpurpose investment” becomes binding, i.e., the trade date rather than the settlement date.
For purposes of the calculation of purchase price and disposition price, brokerage or selling commissions, administrative expenses
or similar expenses shall not increase the purchase price of an item and shall not reduce the amount actually or constructively
received upon disposition of an item, except to the extent such costs constitute “qualified administrative costs”.

    	-14-

    	 

    

(iv)          Within
thirty (30) days of the last day of the fifth and each succeeding fifth “bond year” (which, unless otherwise advised
by the Trust, shall be the five-year period ending on the date five years subsequent to the date immediately preceding the date
of issuance of the Trust Bonds and each succeeding fifth “bond year”) and within thirty (30) days of the date the last
bond that is part of the Trust Bonds is discharged (or on any other periodic basis requested in writing by the Trust), the Borrower
shall (A) calculate, or cause to be calculated, the “rebate amount” as of the “computation date” or “final
computation date” attributable to any “nonpurpose investment” made by the Borrower and (B) remit the following
to the Trust: (1) an amount of money that when added to the “future value” as of the “computation date”
of any previous payments made to the Trust on account of rebate equals the “rebate amount”, (2) the calculations supporting
the “rebate amount” attributable to any “nonpurpose investment” made by the Borrower allocated to “gross
proceeds” of the Trust Bonds, and (3) any other information requested by the Trust relating to compliance with Section 148
of the Code (e.g., information related to any “nonpurpose investment” of the Borrower for purposes of application of
the “universal cap”).

(v)          The
Borrower covenants and agrees that it will account for “gross proceeds” of the Trust Bonds, investments allocable to
the Trust Bonds and expenditures of “gross proceeds” of the Trust Bonds in accordance with Treasury Regulations §1.148-6.
All allocations of “gross proceeds” of the Trust Bonds to expenditures will be recorded on the books of the Borrower
kept in connection with the Trust Bonds no later than 18 months after the later of the date the particular Costs of the Borrower’s
Project is paid or the date the portion of the project financed by the Trust Bonds is placed in service. All allocations of proceeds
of the Trust Bonds to expenditures will be made no later than the date that is 60 days after the fifth anniversary of the date
the Trust Bonds are issued or the date 60 days after the retirement of the Trust Bonds, if earlier. Such records and accounts will
include the particular Costs paid, the date of the payment and the party to whom the payment was made.

(vi)          From
time to time as directed by the Trust, the Borrower shall provide to the Trust a written report demonstrating compliance by the
Borrower with the provisions of Section 2.02(f) of this Loan Agreement, each such written report to be submitted by the Borrower
to the Trust in the form of a full and complete written response to a questionnaire provided by the Trust to the Borrower. Each
such questionnaire shall be provided by the Trust to the Borrower not less than fourteen (14) days prior to the date established
by the Trust for receipt from the Borrower of the full and complete written response to the questionnaire.

(i)          Inspections;
Information. The Borrower shall permit the Trust and the Trustee and any party designated by any of such parties, 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 Trust and the Trustee may reasonably require in connection
therewith.

    	-15-

    	 

    

(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)          Costs
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 Trust 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 Trust and the Trustee 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 Trust 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, in the opinion of the Trust, such variances are not to the material detriment of the interests
of the holders of the Trust Bonds;

(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 Trust, 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 Trust, (C) the resolution of the Borrower, if any, confirming the details of the
sale of the Borrower Bond to the Trust, (D) the resolution of the Borrower, if any, declaring its official intent to reimburse
expenditures for the Costs of the Project from the proceeds of the Trust Bonds, each of said resolutions of the Borrower being
certified by an Authorized Officer of the Borrower as of the date of the Loan Closing, (E) the resolution of the BPU approving
the issuance by the Borrower of the Borrower Bond to the Trust and setting forth any other approvals required therefor by the BPU,
if applicable, and (F) any other Proceedings;

(iv)          if
the Loan is being made to reimburse the Borrower for all or a portion of the Costs of the Borrower’s Project or to refinance
indebtedness or reimburse the Borrower for the repayment of indebtedness previously incurred by the Borrower to finance all or
a portion of the Costs of the Borrower’s Project, an opinion of Bond Counsel, in form and substance satisfactory to the Trust,
to the effect that such 

    	-16-

    	 

    
reimbursement or refinancing will not adversely affect the exclusion from gross income for federal income
tax purposes of the interest on the Trust Bonds; and

(v)          the
certificates of insurance coverage as required pursuant to the terms of Section 3.06(d) hereof and such other certificates, documents,
opinions and information as the Trust 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 Trust the Borrower Bond, as previously executed, attested and, if applicable, authenticated, upon the receipt
of a written certification of the Trust that a portion of the net proceeds of the Trust Bonds shall be deposited in the Project
Loan Account simultaneously with the delivery of the Borrower Bond.

(n)          Notice
of Material Adverse Change. The Borrower shall promptly notify the Trust 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)          Continuing
Disclosure Covenant. To the extent that the Trust, in its sole discretion, determines, at any time prior to the termination
of the Loan Term, that the Borrower is a material “obligated person”, as the term “obligated person” is
defined in Rule 15c2-12, with materiality being determined by the Trust pursuant to criteria established, from time to time, by
the Trust in its sole discretion and set forth in a bond resolution or official statement of the Trust, the Borrower hereby covenants
that it will authorize and provide to the Trust, for inclusion in any preliminary official statement or official statement of the
Trust, all statements and information relating to the Borrower deemed material by the Trust for the purpose of satisfying Rule
15c2-12 as well as Rule 10b-5 promulgated pursuant to the Securities Exchange Act of 1934, as amended or supplemented, including
any successor regulation or statute thereto (“Rule 10b-5”), including certificates and written representations of the
Borrower evidencing its compliance with Rule 15c2-12 and Rule 10b-5; and the Borrower hereby further covenants that the Borrower
shall execute and deliver the Continuing Disclosure Agreement, in substantially the form attached hereto as Exhibit H, with such
revisions thereto prior to execution and delivery thereof as the Trust shall determine to be necessary, desirable or convenient,
in its sole discretion, for the purpose of satisfying Rule 15c2-12 and the purposes and intent thereof, as Rule 15c2-12, its purposes
and intent may hereafter be interpreted from time to time by the SEC or any court of competent jurisdiction; and pursuant to the
terms and provisions of the Continuing Disclosure Agreement, the Borrower shall thereafter provide on-going disclosure with respect
to all statements and information relating to the Borrower in satisfaction of the requirements set forth in Rule 15c2-12 and Rule
10b-5, including, without limitation, the provision of certificates and written representations of the Borrower evidencing its
compliance with Rule 15c2-12 and Rule 10b-5.

    	-17-

    	 

    

(q)          Additional
Covenants and Requirements. (i) No later than the Loan Closing and, if necessary, in connection with the Trust’s issuance
of the Trust Bonds or 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, the use by or on behalf of the Borrower
of certain proceeds of the Trust Bonds as such use relates to the exclusion from gross income for federal income tax purposes of
the interest on any Trust Bonds, the transfer of revenues and receipts from the Borrower’s Environmental Infrastructure System,
compliance with Rule 15c2-12, Rule 10b-5 and any other applicable federal or state securities laws, and matters in connection with
the appointment of the Trustee under the Bond Resolution and any successors thereto. The Borrower hereby agrees to observe and
comply with each such additional covenant and requirement, if any, included in Exhibit F hereto as if the same were set forth herein
in its entirety. (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 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.

 

    	-18-

    	 

    

ARTICLE
III

LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS

SECTION
3.01.          Loan; Loan Term. The Trust 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 Trust upon the terms set forth
in Exhibit A-2 attached hereto and made a part hereof; provided, however, that the Trust shall be under no obligation to make the
Loan if (a) at the Loan Closing, the Borrower does not deliver to the Trust 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 the Bond Resolution or this Loan Agreement.
Although the Trust 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 Costs of the Project, due to unforeseen circumstances there may not be a sufficient amount on deposit
in the Project Fund on any date to make the disbursement in such amount. Nevertheless, the Borrower agrees that the amount actually
deposited in the Project Loan Account at the Loan Closing plus the Borrower’s allocable share of (i) certain costs of issuance
and underwriter’s discount for all Trust Bonds issued to finance the Loan; (ii) capitalized interest during the Project construction
period, if applicable; and (iii) that portion of the Debt Service Reserve Fund (to the extent the Trust establishes a Debt Service
Reserve Fund pursuant to the Bond Resolution) attributable to the cost of funding reserve capacity for the Project, if applicable,
shall constitute the initial principal amount of the Loan (as the same may be adjusted downward in accordance with the definition
thereof), and neither the Trust nor the Trustee shall have any obligation thereafter to loan any additional amounts to the Borrower.

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 the Borrower Bond, Interest on the Borrower Bond
and other amounts due under the Borrower Bond are 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
Trustee, as the agent of the Trust, shall disburse the amounts on deposit in the Project Loan Account to the Borrower upon receipt
of a requisition executed by an Authorized Officer of the Borrower, and approved by the Trust, in a form meeting the requirements
of Section 5.02(3) of the Bond Resolution.

(b)          The
Trust and Trustee shall not be required to disburse any Loan proceeds to the Borrower under this Loan Agreement, unless:

(i)          the
proceeds of the Trust Bonds shall be available for disbursement, as determined solely by the Trust;

    	-19-

    	 

    

(ii)          in
accordance with the Bond Act, 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 Fund 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 Trust;

(iii)          the
Borrower shall have on hand moneys to pay for the greater of (A) that portion of the total Costs of the Project that is not eligible
to be funded from the Fund Loan or the Loan, or (B) that portion of the total Costs of the Project that exceeds the actual amounts
of the loan commitments made by the State and the Trust, respectively, for the Fund Loan and the Loan; and

(iv)          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 in installments payable to the Trustee as follows:

(i)          the
principal of the Loan shall be repaid annually 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 any credits applicable to the Borrower as
set forth in the Bond Resolution;

(ii)          the
Interest Portion described in clause (i) of the definition thereof shall be paid semiannually on the Interest 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 any credits applicable to the Borrower as set forth in the Bond Resolution; and

(iii)          the
Interest Portion described in clause (ii) of the definition thereof shall be paid upon the date of optional redemption or acceleration,
as the case may be, of the Trust Bonds allocable to any prepaid or accelerated Trust Bond Loan Repayment.

The obligations
of the Borrower under the Borrower Bond shall be deemed to be amounts payable under this Section 3.03. Each Loan Repayment, whether
satisfied through a direct payment by the Borrower to the Trustee or (with respect to the Interest Portion) through the use of
Trust Bond proceeds and income thereon on deposit in the Interest Account (as defined in the Bond Resolution) to pay interest on
the Trust Bonds, shall be deemed to be a credit against the corresponding obligation of the Borrower under this Section 3.03 and
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 first to the Interest Portion then due and payable, second
to the principal of the Loan then due and payable, third to the payment of the Administrative Fee, and finally to
the payment of any late charges hereunder.

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(b)          The
Interest on the Loan described in clause (iii) of the definition thereof shall (i) consist of a late charge for any Trust Bond
Loan Repayment that is received by the Trustee later than the tenth (10th) day following its due date and (ii) be payable immediately
thereafter 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 such late payment from its due date to the date it is actually paid; provided, however, that the rate of Interest on the
Loan, including, without limitation, any late payment charges incurred hereunder, shall not exceed the maximum interest rate permitted
by law.

(c)          The
Borrower shall receive, as a credit against its semiannual payment obligations of the Interest Portion, the amounts certified by
the Trust pursuant to Section 5.10 of the Bond Resolution. Such amounts shall represent the Borrower’s allocable share of
the interest earnings on certain funds and accounts established under the Bond Resolution, calculated in accordance with Section
5.10 of the Bond Resolution.

(d)          In
accordance with the provisions of the Bond Resolution, the Borrower shall receive, as a credit against its Trust Bond Loan Repayments,
the amounts set forth in the certificate of the Trust filed with the Trustee pursuant to Section 5.02(4) of the Bond Resolution.

(e)          The
Interest on the Loan described in clause (ii) of the definition thereof shall be paid by the Borrower in the amount of one-half
of the Administrative Fee, if any, to the Trustee semiannually on each February 1 and August 1, commencing August 1, 2012.

(f)          The
Borrower hereby agrees to pay to the Trust at the Loan Closing a “Security Review Fee” in the amount necessary to reimburse
the Trust for all of its costs and expenses incurred in connection with reviewing the additional security securing the Trust Loan
as set forth in Exhibit F hereto, if any, including without limitation the fees and expenses of any professional advisers hired
by the Trust in connection therewith.

SECTION
3.03A.          Amounts on Deposit in Project Loan Account After Completion of
Project Draws.

(a)          If,
on the date which is thirty (30) days following the final date for which a disbursement of Loan proceeds is scheduled to be made
pursuant to Exhibit C hereto, any amounts remain on deposit in the Borrower’s Project Loan Account, the Borrower must provide
to the Trust and the Department a certificate of an Authorized Officer of the Borrower (i) stating that the Borrower has not yet
completed the Project, (ii) stating that the Borrower intends to complete the Project, (iii) setting forth the amount of remaining
Loan Proceeds required to complete the Project, and (iv) providing a revised draw schedule, in a form similar to Exhibit C hereto
and approved by the Department.

(b)          If,
on the date which is thirty (30) days following the final date for which a disbursement of Loan proceeds is scheduled to be made
pursuant to a revised draw schedule certified to the Trust and the Department in accordance with Section 3.03A(a) hereof, any amounts
remain on deposit in the Borrower’s Project Loan Account, the Borrower must provide to the Trust and the Department a certificate
of an Authorized Officer of the Borrower (i) stating that the Borrower has not yet completed the Project, (ii) stating that the
Borrower intends to 

    	-21-

    	 

    
complete the Project, (iii) setting forth the amount of remaining Loan Proceeds required to complete the Project,
and (iv) providing a revised draw schedule, in a form similar to Exhibit C hereto and approved by the Department.

(c)          If,
on the date which the Borrower has completed the Project, any amounts remain on deposit in the Borrower’s Project Loan Account,
the Borrower must within thirty (30) days following such date provide to the Trust and the Department a certificate (i) stating
that the Project is complete and (ii) setting forth the remaining costs, if any, of the Project for which a disbursement of Loan
will be required.

(d)          If
the Borrower fails to provide the certificate described in paragraphs (a), (b) or (c) of this Section 3.03A, when due, or if such
certificate states that the Borrower does not require all or any portion of the amount on deposit in the Project Loan Account to
complete the Project, such amounts on deposit in the Project Loan Account which are not certified by an Authorized Officer of the
Borrower as being required to complete the Project (“Excess Project Funds”) shall be applied as follows:

(i)          If
Trust Bonds can be redeemed within sixty (60) days of the date the Borrower is required to provide the certificate described in
paragraphs (a), (b) or (c) of this Section 3.03A, the Excess Project Funds shall be used by the Trust within such sixty (60) day
period to redeem Trust Bonds, including payment of any pre-payment premium. The Trust Bonds shall be redeemed in inverse order
of their maturity. The amount of any maturity redeemed shall not exceed the same proportion as the Loan bears to all Loans made
from proceeds of the Trust Bonds rounded down to whole denominations or any integral multiple. The aggregate amount of Trust Bonds
so redeemed shall not be less than the amount of nonqualified bonds allocable to the Borrower under Treasury Regulations §1.142-12.
The Excess Project Funds used to redeem Trust Bonds shall be applied by the Trust as a prepayment of the Borrower’s Loan
Repayments with respect to the redeemed bonds. Any excess shall be held by Trust invested at a yield which does not exceed the
yield on the Trust Bonds.

(ii)          If
Trust Bonds can not be redeemed within sixty (60) days of the date the Borrower is required to provide the certificate described
in paragraphs (a), (b) or (c) of this Section 3.03A, the Trust shall, within such sixty (60) day period, (A) deposit all of the
Excess Project Funds in a defeasance escrow established to defease Trust Bonds in inverse order of their maturity, in the same
proportion as the Loan bears to all Loans made from proceeds of the Trust Bonds, (B) provide the notice to the Internal Revenue
Service required pursuant to Treasury Regulations §1.142-2(c)(2), or any successor income tax regulations, and (C) apply the
Excess Project Funds as a prepayment of the Borrower’s Loan Repayments for the defeased Trust Bonds. The aggregate amount
of Trust Bonds so defeased shall not be less than the amount of nonqualified bonds allocable to the Borrower under Treasury Regulations
§1.142-12.

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,

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 reduced, abrogated, terminated, waived, diminished, postponed or otherwise modified in any manner
or to any extent whatsoever while any Trust Bonds remain outstanding or 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 Trust or the Trustee to perform and observe any agreement, whether express or implied, or any duty, liability or obligation
arising out of or connected with the Project, this Loan Agreement or the Bond Resolution, or any rights of set-off, recoupment,
abatement or counterclaim that the Borrower might otherwise have against the Trust, 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 or the Bond Resolution.

The Borrower acknowledges
that payment of the Trust Bonds by the Trust, including payment from moneys drawn by the Trustee from the Debt Service Reserve
Fund (to the extent the Trust establishes a Debt Service Reserve Fund pursuant to the Bond Resolution), does not constitute payment
of the amounts due under this Loan Agreement and the Borrower Bond. If at any time the amount in the Debt Service Reserve Fund
shall be less than the Debt Service Reserve Requirement as the result of any transfer of moneys from the Debt Service Reserve Fund
to the Debt Service Fund (as all such terms are defined in the Bond Resolution) as the result of a failure by the Borrower to make
any Trust Bond Loan Repayments required hereunder, the Borrower agrees to replenish (i) such moneys so transferred and (ii) any
deficiency arising from losses incurred in making such transfer as the result of the liquidation by the Trust of Investment Securities
(as defined in the Bond Resolution) acquired as an investment of moneys in the Debt Service Reserve Fund, by making payments to
the Trust in equal monthly installments for the lesser of six (6) months or the remaining term of the Loan at an interest rate
to be determined by the Trust necessary to make up any loss caused by such deficiency.

The Borrower acknowledges
that payment of the Trust Bonds from moneys that were originally received by the Trustee from repayments by the Borrowers of loans
made to the Borrowers by the State, acting by and through the Department, pursuant to loan agreements dated as of May 1, 2012 by
and between the Borrowers and the State, acting by and through the Department, to finance or refinance a portion of the Costs of
the Environmental Infrastructure Facilities of the Borrowers, and which moneys were upon such receipt by the Trustee deposited
in the Trust Bonds Security Account (as defined in the Bond Resolution) does not constitute payment of the amounts due under this
Loan Agreement and the Borrower Bond.

SECTION
3.05.          Loan Agreement to Survive Bond Resolution and Trust
Bonds. The Borrower acknowledges that its duties, covenants, obligations and agreements hereunder shall survive the discharge
of the Bond Resolution applicable to the Trust Bonds and shall survive the payment of the principal and redemption premium, if
any, of and the interest on the Trust Bonds until the Borrower can take no action or fail to take any action that could adversely
affect the exclusion from gross income of the interest on the Trust Bonds for purposes of federal 

    	-23-

    	 

    
income taxation, at which time
such duties, covenants, obligations and agreements hereunder shall, except for those set forth in Sections 3.06(a) and (b) hereof,
terminate.

SECTION
3.06.          Disclaimer of Warranties and Indemnification.

(a)          The
Borrower acknowledges and agrees that (i) neither the Trust nor the Trustee makes 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 Trust or the Trustee or their respective 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 Trust and
the Trustee 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 Trust and the Trustee 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 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, the Trust and the Trustee that the Trust and its 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. It is further agreed that the Trustee and its directors, 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 pursuant to
this Loan Agreement, except in the event of loss or damage resulting from their own negligence or willful misconduct.

(c)          The
Borrower and the Trust agree that all claims shall be subject to and governed by the provisions of the New Jersey Contractual Liability
Act, N.J.S.A. 59:13-1 et seq. (except for N.J.S.A. 59:13-9 thereof), although such Act by its express terms does not apply
to claims arising under contract with the Trust.

(d)          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 Trust and its directors, 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 later 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 Trust, the Borrower shall maintain said liability
insurance covering the Trust and said directors, employees and officers in good standing; and (ii)

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 the Borrower shall include the
Trust 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 Trust in good standing.

The Borrower shall
provide the Trust 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(d).

SECTION
3.07.          Option to Prepay Loan Repayments. The Borrower
may prepay the Trust Bond Loan Repayments, in whole or in part (but if in part, in the amount of $100,000 or any integral multiple
thereof), upon prior written notice to the Trust and the Trustee not less than ninety (90) days in addition to the number of days’
advance notice to the Trustee required for any optional redemption of the Trust Bonds, and upon payment by the Borrower to the
Trustee of amounts that, together with investment earnings thereon, will be sufficient to pay the principal amount of the Trust
Bond Loan Repayments to be prepaid plus the Interest Portion described in clause (ii) of the definition thereof on any such date
of redemption; provided, however, that, with respect to any prepayment other than those required by Section 3.03A hereof, any such
full or partial prepayment may only be made (i) if the Borrower is not then in arrears on its Fund Loan, (ii) if the Borrower is
contemporaneously making a full or partial prepayment of the Fund Loan such that, after the prepayment of the Loan and the Fund
Loan, the Trust, in its sole discretion, determines that the interests of the owners of the Trust Bonds are not adversely affected
by such prepayments, and (iii) upon the prior written approval of the Trust. In addition, if at the time of such prepayment the
Trust Bonds may only be redeemed at the option of the Trust upon payment of a premium, the Borrower shall add to its prepayment
of Trust Bond Loan Repayments an amount, as determined by the Trust, equal to such premium allocable to the Trust Bonds to be redeemed
as a result of the Borrower’s prepayment. Prepayments shall be applied first to the Interest Portion that accrues on the
portion of the Loan to be prepaid until such prepayment date as described in clause (ii) of the definition thereof and then to
principal payments (including premium, if any) on the Loan in inverse order of their maturity.

SECTION
3.08.          Priority of Loan and Fund Loan.

(a)          The
Borrower hereby acknowledges that, to the extent allowed by law or the Borrower Bond Resolution, any Loan Repayments then due and
payable on the Loan shall be satisfied by the Trustee before any loan repayments on the Borrower’s Fund Loan shall be satisfied
by the Trustee. The Borrower agrees not to interfere with any such action by the Trustee.

(b)          The
Borrower hereby acknowledges that in the event the Borrower fails or is unable to pay promptly to the Trust in full any Trust Bond
Loan Repayments under this Loan Agreement when due, then any (i) Administrative Fee paid hereunder, (ii) late charges paid hereunder,
and (iii) loan repayments paid by the Borrower on its Fund Loan under the related loan agreement therefor, any of which payments
shall be received by the Trustee during the time of any such Trust Bond Loan Repayment deficiency, shall be applied by the Trustee
first to satisfy such Trust Bond Loan Repayment deficiency as a credit against the obligations of the Borrower to make payments
of the Interest Portion under the Loan and the Borrower Bond, 

    	-25-

    	 

    
second, to the extent available, to make Trust Bond Loan Repayments
of principal hereunder and payments of principal under the Borrower Bond, third, to the extent available, to pay the Administrative
Fee, fourth, to the extent available, to pay any late charges hereunder, fifth, to the extent available, to satisfy
the repayment of the Borrower’s Fund Loan under its related loan agreement therefor, and finally, to the extent available,
to satisfy the repayment of the administrative fee under any such related loan agreement.

(c)          The
Borrower hereby further acknowledges that any loan repayments paid by the Borrower on its Fund Loan under the related loan agreement
therefor 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 Trust 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 Trust.

(a)          The
Borrower hereby expressly acknowledges that, other than the provisions of Section 2.02(d)(ii) hereof, the Trust’s right,
title and interest in, to and under this Loan Agreement and the Borrower Bond have been assigned to the Trustee as security for
the Trust Bonds as provided in the Bond Resolution, and that if any Event of Default shall occur, the Trustee or any Bond Insurer
(as such term may be defined in the Bond Resolution), if applicable, pursuant to the Bond Resolution, shall be entitled to act
hereunder in the place and stead of the Trust. The Borrower hereby acknowledges the requirements of the Bond Resolution applicable
to the Trust Bonds and consents to such assignment and appointment. This Loan Agreement and the Borrower Bond, including, without
limitation, the right to receive payments required to be made by the Borrower hereunder and to compel or otherwise enforce observance
and performance by the Borrower of its other duties, covenants, obligations and agreements hereunder, may be further transferred,
assigned and reassigned in whole or in part to one or more assignees or subassignees by the Trustee at any time subsequent to their
execution without the necessity of obtaining the consent of, but after giving prior written notice to, the Borrower.

The Trust shall
retain the right to compel or otherwise enforce observance and performance by the Borrower of its duties, covenants, obligations
and agreements under Section 2.02(d)(ii) hereof; provided, however, that in no event shall the Trust have the right to accelerate
the Borrower Bond in connection with the enforcement of Section 2.02(d)(ii) hereof.

(b)          The
Borrower hereby approves and consents to any assignment or transfer of this Loan Agreement and the Borrower Bond that the Trust
deems to be necessary in connection with any refunding of the Trust Bonds or the issuance of additional bonds under the Bond Resolution
or otherwise, all in connection with the pooled loan program of the Trust.

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
Trust and the Trustee 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; (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; and (iv) the Trust shall have received an opinion of Bond Counsel to the effect
that such assignment will not adversely affect the security of the holders of the Trust Bonds or the exclusion of the interest
on the Trust Bonds from gross income for purposes of federal income taxation under Section 103(a) of the Code.

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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 Trust Bond 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, the Administrative Fee or 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 Trustee, unless
the Trustee 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 Trustee 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 Trust and specified in Exhibit F attached hereto and made a part hereof.

SECTION
5.02.          Notice of Default. The Borrower shall give the
Trustee and the Trust 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 Borrower acknowledges the rights of the Trustee and
of any Bond Insurer to direct any and all remedies in accordance with the terms of the Bond Resolution, and the Borrower also acknowledges
that the Trust shall have the right to take, or to direct the Trustee to take, any action permitted or required pursuant to the
Bond Resolution and to take whatever other 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 Trust shall, to the extent
allowed by applicable law and to the extent and in the manner set forth in the Bond Resolution, have the right to declare, or to
direct the Trustee to declare, all Loan Repayments and all other amounts due hereunder (including, without limitation, payments
under the Borrower Bond) together with the prepayment premium, if any, calculated pursuant to Section 3.07 hereof 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 Trust or the Trustee 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 either of them
in the collection of Trust Bond 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 Trust or the Trustee 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 the Interest Portion then due and payable, (c) third, to the extent available, to pay the principal due and payable
on the Loan, (d) fourth, to the extent available, to pay the Administrative Fee, any late charges incurred hereunder or
any other amounts due and payable under this Loan Agreement, and (e) fifth, to the extent available, to pay the Interest
Portion and the principal on the Loan and other amounts payable hereunder as such amounts become due and payable.

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SECTION
5.06.          No Remedy Exclusive; Waiver; Notice. No remedy
herein conferred upon or reserved to the Trust or the Trustee 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 Trust or the Trustee 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.

SECTION
5.07.          Retention of Trust’s Rights.  Notwithstanding
any assignment or transfer of this Loan Agreement pursuant to the provisions hereof or of the Bond Resolution, or anything else
to the contrary contained herein, the Trust 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 Trust may, in its discretion,
deem necessary to enforce the obligations of the Borrower to the Trust pursuant to Section 5.03 hereof.

    	-30-

    	 

    

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
Trust and the Trustee at the following addresses:

(a)          Trust:

New Jersey Environmental
Infrastructure Trust

3131 Princeton Pike

Building 6, Suite 201

Lawrenceville, New Jersey
08648

Attention: Executive
Director

(b)          Trustee:

U.S. 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 Trust 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.

(a)          Except
as otherwise provided in this Section 6.04, this Loan Agreement may not be amended, supplemented or modified without the prior
written consent of the Trust and the Borrower and without the satisfaction of all conditions set forth in Section 11.12 of the
Bond Resolution. Notwithstanding the conditions set forth in Section 11.12 of the Bond Resolution, (i) Section 2.02(p) hereof may
be amended, supplemented or modified upon the written consent of the Trust and the Borrower and without the consent of the Trustee,
any Bond Insurer or any holders of the Trust Bonds, and (ii) Exhibit H hereto may be amended, supplemented or modified prior to
the execution and delivery thereof as the Trust, in its sole discretion, shall determine to be necessary, desirable or convenient
for the purpose of satisfying Rule 15c2-12 

    	-31-

    	 

    
and the purpose and intent thereof as Rule 15c2-12, its purpose and intent may hereafter
be interpreted from time to time by the SEC or any court of competent jurisdiction, and such amendment, supplement or modification
shall not require the consent of the Borrower, the Trustee, any Bond Insurer or any holders of the Trust Bonds.

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 Act and 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 Trust shall be required under the provisions of this Loan Agreement, such consent or approval may only
be given by the Trust unless otherwise provided by law or by rules, regulations or resolutions of the Trust or unless expressly
delegated to the Trustee and except as otherwise provided in Section 6.09 hereof.

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.          Benefit of Loan Agreement; Compliance with Bond
Resolution. This Loan Agreement is executed, among other reasons, to induce the purchase of the Trust Bonds. Accordingly, all
duties, covenants, obligations and agreements of the Borrower herein contained are hereby declared to be for the benefit of and
are enforceable by the Trust, the holders of the Trust Bonds and the Trustee. The Borrower covenants and agrees to observe and
comply with, and to enable the Trust to observe and comply with, all duties, covenants, obligations and agreements contained in
the Bond Resolution.

SECTION
6.10.          Further Assurances. The Borrower shall, at the
request of the Trust, 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.

    	-32-

    	 

    

IN WITNESS WHEREOF,
the Trust and the Borrower have caused this Loan Agreement to be executed, sealed and delivered as of the date first above
written.

 

	 	 	
        NEW JERSEY ENVIRONMENTAL

        INFRASTRUCTURE TRUST

         

         

         

	[SEAL]	 	By:	/s/Warren H. Victor
	 	 	 	Warren H. Victor
 Chairman
	
        ATTEST:

         
	 	 	 
	 	 	 	 
	/s/ David E. Zimmer	 	 	 
	
        David E. Zimmer

        Assistant Secretary
	 	 	 
	 	 	
         

         

         

        MIDDLESEX WATER COMPANY

	
         

        [SEAL]
	 	 	 
	 	 	 	 
	 	 	By:	/s/A. Bruce O’Connor
	ATTEST:	 	 	
        A.Bruce O’Connor

        President & CFO

	
         

         
	 	 	 
	/s/Kenneth J. Quinn	 	 	 
	Kenneth J. Quinn, Secretary	 	 	 

 

[signature page]

 

    	-33-

    	 

    

SCHEDULE A

Certain Additional Loan Agreement Provisions

    	S-1

    	 

    

EXHIBIT A-1

Description of Project and Environmental Infrastructure System

    	A-1

    	 

    

EXHIBIT A-2

Description of Loan

See Schedule to Specimen Borrower Bond (Exhibit
D hereto)

    	A-2

    	 

    

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

    	 

    

 

(Except for assignment page, to be supplied
by Borrower’s

bond counsel in substantially the following form)

IMPORTANT NOTE:
The next three 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., amounts payable under
the Borrower Bond set forth in the first paragraph, assignment in the second paragraph, disbursement language in the third paragraph,
unconditional obligation in the fourth paragraph, optional prepayment provisions in the fifth paragraph and the date of the Borrower
Bond). 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,
[the] [NAME OF BORROWER], a corporation duly created and validly existing under the Constitution and laws of the State (the “Borrower”),
hereby promises to pay to the order of the New Jersey Environmental Infrastructure Trust (the “Trust”) (i) 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,
together with (ii) 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) in the amount calculated as provided in the Loan Agreement,
payable on the days and in the amounts and as provided in the Loan Agreement, which principal amount and Interest Portion of the
Interest on the Loan shall, unless otherwise provided in the Loan Agreement, be payable on the days and in the amounts as also
set forth in Exhibit A attached hereto under the column headings respectively entitled “Principal” and “Interest”,
plus (iii) any other amounts due and owing under the Loan Agreement at the times and in the amounts as provided therein. The Borrower
unconditionally and irrevocably promises, in accordance with the terms of and to the extend provided in the Borrower Bond Resolution
(as defined in the Loan Agreement) to pay in full and when due the principal of and the Interest on this Borrower Bond (as defined
in the Loan Agreement) 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 May 1, 2012 by and between the Trust 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 in the Loan Agreement. This Borrower Bond has been assigned to U.S. Bank National
Association, as trustee (the “Trust’s Trustee”) under the “Environmental Infrastructure Bond Resolution,
Series 2012B”, adopted by the Trust on March 15, 2012, as the same may be amended and supplemented in accordance with the
terms thereof (the “Bond Resolution”), and payments hereunder shall, except as otherwise provided in the Loan Agreement,
be made directly to the Trust’s Trustee for the account of the Trust pursuant to such assignment. Such assignment has been
made as security for the payment of the Trust Bonds (as defined in the Loan Agreement) issued to finance or refinance the Loan
and as otherwise described in the Loan Agreement. This Borrower Bond is subject to further assignment or endorsement in accordance
with the terms of the Bond Resolution and 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 Trustee to the Borrower, in accordance with written instructions of the Trust,
upon receipt by the Trust and the Trust’s Trustee 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 Trust under the Loan Agreement or under any other agreement between the Borrower and the Trust
or out of any indebtedness or liability at any time owing to the Borrower by the Trust 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.

IN WITNESS WHEREOF,
the Borrower has caused this Borrower Bond to be duly executed, sealed and delivered as of May 3, 2012.

	 	 	[NAME OF BORROWER]
	[SEAL]	 	 	 
	 	 	By:	 
	ATTEST:	 	 	 
	 	 	 	 
	 	 	 	 

 

    	D-3

    	 

    

 

New Jersey Environmental
Infrastructure Trust hereby assigns the foregoing Borrower Bond to U.S. Bank National Association, as the Trust’s Trustee
under the “Environmental Infrastructure Bond Resolution, Series 2012B”, adopted on March 15, 2012, as amended and supplemented,
all as of the date of this Borrower Bond, as security for the Trust Bonds issued or to be issued under the Bond Resolution to finance
or refinance the Project Fund (as defined in the Bond Resolution).

	 	 	NEW JERSEY ENVIRONMENTAL
	 	 	INFRASTRUCTURE TRUST
	[SEAL]	 	 	 
	 	 	By:	/s/Warren H. Victor            
	ATTEST:         	 	 	 Warren H. Victor
	          Chairman	 	 	 
	/s/David E. Zimmer                    	 	 	 
	David E. Zimmer	 	 	 
	Assistant Secretary	 	 	 

 

    	D-4

    	 

    

EXHIBIT E

Opinions of Borrower’s Bond Counsel and General Counsel

 

    	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-1exhibit10_01.htm

 

  

Exhibit 10.01

AWARD NOTICE

NOTICE OF RESTRICTED STOCK UNITS

AWARDED PURSUANT TO THE

EASTMAN CHEMICAL COMPANY

2012 OMNIBUS STOCK COMPENSATION PLAN

Recipient:  Michael Chung

Number of Restricted Stock Units: 6,000

Date of Award:  May 31, 2012

1.           Award of Restricted Stock Unit.  This Award Notice serves to notify you that the Compensation and Management Development Committee (the “Committee”) of the Board of Directors of Eastman Chemical Company ("Company") has awarded to you, under the Company’s 2012 Omnibus Stock Compensation Plan (the "Plan"), the number of restricted stock units ("Restricted Stock Units") set forth above, representing the right to receive the same number of unrestricted shares of its $.01 par value Common Stock ("Common Stock"),  subject to the terms of the Plan and this Award Notice.  The Plan is incorporated herein by reference and made a part of this Award Notice. Terms not otherwise defined herein have the respective meanings set forth in the Plan.

2.           Lapse of Restrictions and Vesting of Restricted Stock Units. Subject to forfeiture of all of the Restricted Stock Units prior to vesting as described in Sections 7 and 11 of this Award Notice, the Restricted Stock Units will vest upon (i) as to one-third of the shares, the earlier of  the third anniversary of the award date, if and only if you are still an employee of the Company or its Subsidiaries at that time; or termination of your employment with the Company or its Subsidiaries by reason of death or disability, with the number of Restricted Stock Units set forth above prorated based on the number of full calendar months in which you were employed during the vesting period, and (ii) as to the remaining shares a date not later than the third anniversary of the award date as determined by the Committee, subject to your satisfactory performance in the area of management and leadership development of internal succession candidates responsible for Fibers major customer relationships in China and Asia Pacific, based upon the recommendation of the Chief Executive Officer (CEO) and at the Committee’s discretion, (the date described in clauses (i) and (ii),   as applicable, is referred to herein as the "Vesting Date").

3.           Issuance of Shares Upon Vesting of Restricted Stock Units.  Subject to the other terms of this Award Notice, the Company will either issue a certificate or certificates for shares of Common Stock underlying the vested Restricted Stock Units as promptly as practicable following the Vesting Date or place the shares in your account maintained by the Company's stock plan administrator.  The Company may withhold or require you to remit a cash amount sufficient to satisfy all taxes required by law to be withheld. Further, either the Company or you may elect to satisfy the withholding requirement by having the Company withhold shares of common stock having a Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax which could be imposed on the transaction.

4.           Nontransferability of Restricted Stock Units; Limitation on Issuance of Shares.  The Restricted Stock Units may not, except as otherwise provided in the Plan, be sold, assigned, transferred, pledged, or encumbered in any way, whether by operation of law or otherwise. After the Vesting Date, certificates for the shares underlying the Restricted Stock Units may be issued during your lifetime only to you, except in the case of a permanent disability involving mental incapacity.

5.           Limitation of Rights.  Prior to issuance of shares to you following the Vesting Date, you will have no voting or other rights as a stockholder of the Company with respect to the Restricted Stock Units or the underlying common shares. Neither the Plan nor this Award or Award Notice gives you any right to remain employed by the Company and its Subsidiaries.

  

61

  

Exhibit 10.01

 

6.           Dividend Equivalents.  The Restricted Stock Units entitle you to dividend equivalents equal to any cash dividends paid during the period that the Restricted Stock Units are outstanding and unvested with respect to a corresponding number of shares of Common Stock underlying Restricted Stock Units which vest on the Vesting Date. All such accrued dividend equivalents will become payable in cash by the Company into your account maintained by the Company’s stock plan administrator upon the Vesting Date of the Restricted Stock Units.  Until payment, the dividend equivalents shall be subject to the same terms and conditions as the Restricted Stock Units to which such dividend equivalents relate and shall be forfeited and not paid in the event that such Restricted Stock Units are not vested and are forfeited.

7.           Termination.  Upon termination of your employment with the Company or its Subsidiaries prior to the Vesting Date, other than for one of the reasons described in Section 2 of this Award Notice, all of the Restricted Stock Units will be canceled and forfeited by you to the Company without the payment of any consideration by the Company.  In such event, neither you nor any of your successors, heirs, assigns, or personal representatives will thereafter have any further rights or interest in such shares or otherwise in this Award.

8.           Change in Ownership; Change in Control.  Article 14 of the Plan contains certain special provisions that will apply to this Award in the event of a Change in Ownership or Change in Control.

            9.          Adjustment of Shares.  If the number of outstanding shares of Common Stock changes through the declaration of stock dividends or stock splits prior to the Vesting Date, the units of Common Stock subject to this Award automatically will be adjusted, according to the provisions of Article 15 of the Plan.  In the event of any other change in the capital structure or the Common Stock of the Company or other corporate events or transactions involving the Company, the Committee is authorized to make appropriate adjustments to this Award.

10.           Restrictions on Issuance of Shares.  If at any time the Company determines that listing, registration, or qualification of the Restricted Stock Units or of the shares of Common Stock subject to this Award upon any securities exchange or under any state or federal law, or the approval of any governmental agency, is necessary or advisable as a condition to the award or issuance of certificate(s) for the shares of Common Stock subject to this Award, such award or issuance may not be made in whole or in part unless and until such listing, registration, qualification, or approval shall have been effected or obtained free of any conditions not acceptable to the Company.

            11.           Noncompetition; Confidentiality.  You will not, without the written consent of the Company, either during your employment by the Company or thereafter, disclose to anyone or make use of any confidential information which you have acquired during your employment relating to any of the business of the Company, except as such disclosure or use may be required in connection with your work as an employee of the Company.  During your employment by the Company, and for a period of two years after the termination of such employment, you will not, either as principal, agent, consultant, employee, or otherwise, engage in any work or other activity in competition with the Company in the field or fields in which you have worked for the Company.  The agreement in this Section 11 applies separately in the United States and in other countries but only to the extent that its application shall be reasonably necessary for the protection of the Company.  You will forfeit all rights under this Award Notice to or related to the Restricted Stock Units if, in the determination of the Committee, you have violated any of the provisions of this Section 11, and in that event any payment or other action with respect to the Restricted Stock Units shall be made or taken, if at all, in the sole discretion of the Committee.   

           12.           Reimbursement of Certain Compensation Following Restatement.  The Award is subject to any applicable law or Company policy requiring reimbursement to the Company of certain incentive-based compensation following an accounting restatement due to material non-compliance by the Company with any financial reporting requirement or due to other events or conditions.

13.           Plan Controls.  In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Award Notice, the provisions of the Plan will be controlling and determinative.

  

62

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