Document:

Exhibit 10.40

 

 

 

 

 

 

LOAN AGREEMENT

BY AND BETWEEN

NEW JERSEY INFRASTRUCTURE BANK

AND

MIDDLESEX WATER COMPANY

 

(PROJECT NOS. 1225001-025/028)

 

 

DATED AS OF MAY 1, 2022

     

     

    

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	9
	ARTICLE III LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS
	SECTION 3.01.       Loan; Loan Term	14
	SECTION 3.02.       Disbursement of Loan Proceeds	14
	SECTION 3.03.       Amounts Payable	15
	SECTION 3.03A.    Unexpended Project Funds on Deposit in Project Loan Account	17
	SECTION 3.04.       Unconditional Obligations	17
	SECTION 3.05.       Loan Agreement to Survive Bond Indenture and I-Bank Bonds	18
	SECTION 3.06.       Disclaimer of Warranties and Indemnification	18
	SECTION 3.07.       Option to Prepay Loan Repayments	19
	SECTION 3.08.       Priority of Loan and Fund Loan	20
	SECTION 3.09.       Approval of the New Jersey State Treasurer	20
	ARTICLE IV ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND
	SECTION 4.01.       Assignment and Transfer by I-Bank	22
	SECTION 4.02.       Assignment by Borrower	22
	ARTICLE V EVENTS OF DEFAULT AND REMEDIES
	SECTION 5.01.       Events of Default	23
	SECTION 5.02.       Notice of Default	24
	SECTION 5.03.       Remedies on Default	24
	SECTION 5.04.       Attorneys’ Fees and Other Expenses	24

 

 

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TABLE OF CONTENTS

	Page
	SECTION 5.05.       Application of Moneys	24
	SECTION 5.06.       No Remedy Exclusive; Waiver; Notice	25
	SECTION 5.07.       Retention of I-Bank’s Rights	25
	ARTICLE VI MISCELLANEOUS
	SECTION 6.01.       Notices	26
	SECTION 6.02.       Binding Effect	26
	SECTION 6.03.       Severability	26
	SECTION 6.04.       Amendments, Supplements and Modifications	26
	SECTION 6.05.       Execution in Counterparts	27
	SECTION 6.06.       Applicable Law and Regulations	27
	SECTION 6.07.       Consents and Approvals	27
	SECTION 6.08.       Captions	27
	SECTION 6.09.       Benefit of Loan Agreement; Compliance with Bond Indenture	27
	SECTION 6.10.       Further Assurances	27
	SECTION 6.11.       No Personal Liability	27

 

 

	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 New Jersey Water Bank	G-1
	EXHIBIT H	Form of Continuing Disclosure Agreement	H-1

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NEW JERSEY
INFRASTRUCTURE BANK LOAN AGREEMENT

THIS LOAN AGREEMENT,
made and entered into as of May 1, 2022, by and between the NEW JERSEY INFRASTRUCTURE BANK, 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 I-Bank,
in accordance with the Act, the Bond Indenture and a financial plan approved by the State Legislature in accordance with Sections 22 and
22.1 of the Act, will issue its I-Bank 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 I-Bank 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 I-Bank 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 I-Bank Bonds to finance a portion of the Costs of
the Project;

WHEREAS, the I-Bank
has approved the Borrower’s application for a Loan from available proceeds of the I-Bank 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 I-Bank evidencing said Loan at the Loan Closing.

NOW, THEREFORE,
for and in consideration of the award of the Loan by the I-Bank, 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:

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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 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 that is
equal to fifteen hundredths of one percent (0.15%) of the aggregate sum of (i) the original principal amount of the Loan and (ii) the
original principal amount of the Fund Loan, or such lesser amount, if any, as may be authorized by any act of the State Legislature and
as the I-Bank may approve from time to time.

“Authorized Officer”
means (i) in the case of the I-Bank, the Chairman, Vice-Chairman or Executive Director of the I-Bank, or any other person or persons
designated by the I-Bank by resolution to act on behalf of the I-Bank pursuant to this Loan Agreement, and (ii) in
the case of the Borrower, any person or persons authorized pursuant to a resolution of the board of directors of the Borrower to
perform any act or execute any document relating to the Loan, the Borrower Bond or this Loan Agreement.

“Bond Counsel”
means a law firm appointed or approved by the I-Bank, 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 Bond”
means the general obligation bond, note, debenture or other evidence of indebtedness, authorized, executed, attested and delivered by
the Borrower to the I-Bank and, if applicable, authenticated on behalf of the Borrower to evidence and secure the Borrower’s obligations
to pay the Loan Repayments and all other amounts due and owing by the Borrower under this Loan Agreement, 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 I-Bank pursuant to which the I-Bank
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.

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“Construction
Financing Program Loan” means any loan that may have been made on the date of the Loan Closing by the I-Bank to the Borrower
pursuant to the Construction Financing Program of the I-Bank for the purpose of financing a portion of the Costs of the Project, and,
if made and outstanding, shall be identified and described in Exhibit F hereto.

“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 I-Bank.

“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, a portion of the Costs of which is being financed or refinanced by the I-Bank through
the making of the Loan pursuant to the terms and provisions of this Loan Agreement.

“Event of Default”
means any occurrence or event specified in Section 5.01 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, 2022 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, 2022 by and between the Borrower and the State, acting by and through the Department,
regarding the terms and conditions of the Fund Loan.

“I-Bank”
means the New Jersey Infrastructure Bank, a public body corporate and politic with corporate succession duly created and validly existing
under and by virtue of the Act.

“I-Bank 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.

“I-Bank Bonds”
means bonds authorized by Section 2.03 of the Bond Indenture, together with any refunding bonds authenticated and delivered pursuant to
Section 2.04 of the Bond Indenture, 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,
and (iv) a portion of the costs of issuance related to such bonds, or to refinance any or all of the above.

“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.

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“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 I-Bank Bonds (i) as set forth in Exhibit A-2 hereof under the column heading entitled “Interest”,
or (ii) with respect to any prepayment of I-Bank Bond Loan Repayments in accordance with Section 3.07 or 5.03 hereof, to accrue on any
principal amount of I-Bank Bond Loan Repayments to the date of the optional redemption or acceleration, as the case may be, of the I-Bank
Bonds allocable to such prepaid or accelerated I-Bank Bond Loan Repayment.

“Loan”
means the loan made by the I-Bank 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.

“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 Indenture.

“Loan Agreements”
means any other loan agreements entered into by and between the I-Bank and one or more of the Borrowers pursuant to which the I-Bank 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 I-Bank Bonds.

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

“Loan Repayments”
means the sum of (i) I-Bank 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 I-Bank 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 I-Bank, 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
I-Bank, 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 I-Bank Bonds.

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“Preliminary Official
Statement” means the Preliminary Official Statement relating to the issuance of the I-Bank 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 I-Bank is permitted to make a loan to the Borrower pursuant to the Act, the Regulations and the Bond
Indenture, a portion of the Costs of which is being financed or refinanced by the I-Bank through the making of the Loan pursuant to the
terms and provisions of this Loan Agreement, and which may be identified under either the Drinking Water or Clean Water Project Lists
with the Project Number specified in Exhibit A-1 attached hereto.

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

“Project Loan
Account” means the project loan account established on behalf of the Borrower in the Project Fund in accordance with the Bond
Indenture 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.

“Trustee”
means, initially, Zions Bancorporation, National Association d/b/a Zions Bank, the Trustee
appointed by the I-Bank and its successors as Trustee under the Bond Indenture, as provided in Article X of the Bond Indenture.

“Unexpended Project
Funds” shall have the meaning ascribed thereto in Section 3.03A hereof.

(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 all genders.

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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 I-Bank, the Trustee and the holders
of the I-Bank Bonds as follows:

(a)       Organization
and Authority.

(i)       The
Borrower is a corporation duly created and validly existing pursuant to the Constitution and statutes of the State of New Jersey, including
the Business Corporation Law.

(ii)       The
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 who is no longer the duly acting officer of such Borrower, all such actions previously taken by such officer
remain 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 I-Bank, 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 I-Bank, 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 all 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 I-Bank upon the terms set forth herein; and (D) 

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the execution, delivery and due performance
of any and all other certificates, agreements and instruments that may be required to be executed, delivered and performed by the Borrower
in order to carry out, give effect to and consummate the transactions contemplated by this Loan Agreement.

(vi)       This
Loan Agreement and the Borrower Bond have each been duly authorized by the Borrower and duly executed, attested and delivered by Authorized
Officers of the Borrower, and the Borrower Bond has been duly sold by the Borrower to the I-Bank, 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 I-Bank 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 I-Bank, enforceable against the I-Bank 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 I-Bank 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 delivery of this Loan Agreement or the
Borrower Bond, (v) the issuance of the Borrower Bond and the sale thereof to the I-Bank, (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 I-Bank 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 

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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 I-Bank, (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 under the Borrower Bond, (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 I-Bank, 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 (i) for the authorization,
execution, attestation and delivery of this Loan Agreement and the Borrower Bond, (ii) for the issuance of the Borrower Bond and the sale
thereof to the I-Bank, (iii) for the adoption of the Borrower Bond Resolution, (iv) for the making, observance and performance by the
Borrower of its duties, covenants, obligations and agreements under this Loan Agreement and the Borrower Bond, and (v) 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 I-Bank, 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 

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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 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 I-Bank, 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 I-Bank as described in Exhibit B attached hereto and made a
part hereof (i) to finance or refinance a portion of the Costs of the Project; and (ii) where applicable, to reimburse the Borrower for
a portion of the Costs of the Project, which portion was paid or incurred in anticipation of reimbursement by the I-Bank from proceeds
of the Loan and is eligible for such reimbursement pursuant to the Regulations, and any other applicable law. All of such costs constitute
Costs for which the I-Bank is authorized to make Loans to the Borrower pursuant to the Act and the Regulations.

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; Credit Rating; 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 

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Infrastructure System in good
repair and operating condition; (iii) to cooperate with the I-Bank in the observance and performance of the respective duties, covenants,
obligations and agreements of the Borrower and the I-Bank under this Loan Agreement; (iv) to maintain a Credit Rating from a NRRA, which
Credit Rating may be a non-public, indicative Credit Rating, (all pursuant to, and as such terms are defined in, the “Credit Policy”
of the I-Bank as in effect from time to time) for as long as the remaining aggregate outstanding principal amount of the Borrower Bond
and all other bonds issued by the Borrower to the I-Bank is greater than $2,000,000; and (v) 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,
together with any other moneys available for the purpose, shall be at least sufficient (A) to meet the operation and maintenance expenses
of its Environmental Infrastructure System, and (B) 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 to exercise its best efforts in accordance with prudent
environmental infrastructure utility practice to complete the Project and to accomplish such completion on or before the Project Completion
Date. In undertaking and completing the Project, the Borrower covenants and agrees to comply with each of the terms and provisions contained
herein, including, without limitation, the Exhibits hereto (including, without limitation, Exhibit G hereto). In order to complete the
Project in satisfaction of the terms and provisions hereof, including, without limitation, the Exhibits hereto, the Borrower hereby covenants
and agrees to provide from its own fiscal resources all moneys, in excess of the total amount of loan proceeds it receives pursuant to
the Loan and the Fund Loan, as well as any outstanding Construction Financing Program Loan, that are required in order 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)       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, 

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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.

(g)       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 I-Bank 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 I-Bank within 150 days of the close of the fiscal year being so audited, or such additional period of time as shall be consented to
by an Authorized Officer of the I-Bank in the sole and absolute discretion thereof, subject to the application of applicable law relating
to such additional period of time for the Borrower to complete its audit.

(ii)       Reserved.

(h)       Inspections;
Information. The Borrower shall permit the I-Bank and the Trustee (and any party designated by either of such parties to act on its
behalf or to assist it, including, without limitation, their respective professional advisors), at any and all reasonable times during
construction of the Project and, thereafter, upon prior written notice, (i) to visit, inspect and examine the property constituting the
Project and the site on which the Project is located, and (ii) to inspect (and make and retain copies of) any Borrower accounts, books,
records, correspondence and files, including, without limitation, Borrower records regarding contracts, receipts, disbursements, investments
and the overall financial standing of the Borrower, and any other matters related to the Borrower, the Project and the forgoing list of
deliverables. In furtherance of the intent of this subsection, the Borrower shall promptly prepare and provide such written reports and
informational summaries as the I-Bank or the Trustee may reasonably require.

(i)       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, or to, its Environmental Infrastructure System at least to the
extent that similar insurance is typically carried, and considered commercially reasonable, 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 regulatory requirements applicable
to the Borrower and its Environmental Infrastructure System.

(j)       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 that it will supply to the I-Bank a certificate from a licensed professional engineer
authorized 

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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.

(k)       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 I-Bank 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 an Authorized Officer
of the I-Bank 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 sole discretion of an Authorized Officer of the I-Bank (following consultation with Bond
Counsel), such variances are not to the material detriment of the interests of the holders of the I-Bank 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 I-Bank, 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 I-Bank, (C) the resolution of the Borrower, if any, confirming the details of the sale of the Borrower Bond
to the I-Bank, (D) the resolution of the BPU approving the issuance by the Borrower of the Borrower Bond to the I-Bank and setting forth
any other approvals required therefor by the BPU, if applicable, and (E) any other Proceedings;

(iv)       Reserved;

(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 I-Bank may require in Exhibit F hereto, if any.

(l)       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 I-Bank the Borrower Bond, as previously executed, attested and, if applicable, authenticated, upon the receipt of a written
certification of the I-Bank that a portion of the net proceeds of the I-Bank Bonds shall be deposited in the Project Loan Account simultaneously
with the delivery of the Borrower Bond.

(m)       Notice
of Material Adverse Change. The Borrower shall promptly notify the I-Bank 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.

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(n)       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.

(o)       Additional
Covenants and Requirements. (i) No later than the Loan Closing and, if necessary, in connection with the I-Bank’s issuance of
the I-Bank 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 transfer of revenues and receipts from the Borrower’s
Environmental Infrastructure System, compliance with Rule 15c2-12, 17 CFR 240.10b-5, promulgated by the SEC under the Securities Exchange
Act of 1934, as amended or supplemented, including any successor regulation or statute thereto (“Rule 10b-5”), and any other
applicable federal, state or self-regulatory organizational securities laws, regulations and rules, and matters in connection with the
appointment of the Trustee under the Bond Indenture 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.

(p)       Continuing
Disclosure Covenant. To the extent that the I-Bank, 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 I-Bank pursuant to criteria established, from time to time, by the I-Bank in its sole
discretion and set forth in a bond resolution or official statement of the I-Bank, the Borrower hereby covenants that it will authorize
and provide to the I-Bank, for inclusion in any preliminary official statement or official statement of the I-Bank, all statements and
information relating to the Borrower deemed material by the I-Bank for the purpose of satisfying Rule 15c2-12 as well as 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 I-Bank 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.

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ARTICLE
III

LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS

SECTION
3.01.       Loan; Loan Term.

(a)       The
I-Bank hereby agrees (i) to make the Loan, as described in Exhibit A-2 attached hereto and made a part hereof, to the Borrower, and (ii)
to disburse the proceeds of the Loan to the Borrower in accordance with Section 3.02 hereof. The Borrower hereby agrees to borrow and
accept the Loan from the I-Bank upon the terms set forth in Exhibit A-2 attached hereto and made a part hereof. 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 I-Bank Bonds issued to finance the Loan; and (ii) capitalized interest during
the Project construction period, 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 I-Bank nor the Trustee shall have any obligation thereafter to loan
any additional amounts to the Borrower.

(b)       Notwithstanding
the provisions of subsection (a) of this Section 3.01 to the contrary, the I-Bank shall be under no obligation (i) to make the Loan to
the Borrower if (1) at the Loan Closing, the Borrower does not deliver to the I-Bank the Borrower Bond and such other documents as are
required pursuant to Section 2.02(l) hereof, or (2) an Event of Default has occurred and is continuing pursuant to, and as defined in,
the Bond Indenture or pursuant to this Loan Agreement, or (ii) to disburse the proceeds of the Loan to the Borrower in accordance with
Section 3.02 hereof, unless each of the conditions precedent to such disbursement, as set forth in Section 3.02 hereof, have been satisfied
in full.

(c)       The
Borrower shall use the proceeds of the Loan strictly in compliance with the provisions of Section 2.01(h) hereof.

(d)       The
payment obligations of the Borrower created pursuant to the terms of this Loan Agreement are secured by the Borrower Bond. The obligations
of the Borrower to pay the principal of the Borrower Bond, Interest on the Borrower Bond, and other amounts due under the Borrower Bond
are each direct, general, irrevocable and unconditional obligations of the Borrower payable from any source legally available to the Borrower
in accordance with the terms of and to the extent provided in the Borrower Bond Resolution.

SECTION
3.02.       Disbursement of Loan Proceeds.

(a)       The
Trustee, as the agent of the I-Bank, shall disburse the amounts on deposit in the Project Loan Account to the Borrower (i) upon receipt
of a requisition executed by an Authorized Officer of the Borrower, and approved by the I-Bank, in a form satisfying the requirements
of Section 5.02(3) of the Bond Indenture, and (ii) subject to the schedule limitations set forth in subsection (c) of this Section 3.02.

(b)       The
I-Bank and the Trustee shall not be required to disburse any Loan proceeds to the Borrower pursuant to this Loan Agreement, unless:

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(i)       the
proceeds of the I-Bank Bonds shall be available for disbursement, as determined by the I-Bank in its sole and absolute discretion;

(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;

(iii)       the
Borrower shall have on hand moneys to pay for (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 any outstanding Construction Financing Program Loan, and/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 I-Bank, respectively, for the Fund Loan and the Loan
and any outstanding Construction Financing Program 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.

(c)       Notwithstanding
any provision of this Loan Agreement to the contrary, the I-Bank and the Trustee shall not disburse Loan proceeds to the Borrower from
the Project Loan Account pursuant to the provisions of this Section 3.02 at any time on or after the Project Loan Account Disbursement
Deadline, and, as of such date, any Loan proceeds that remain on deposit in the Project Loan Account shall no longer be available to the
Borrower via the disbursement procedures of this Section 3.02, but shall be disbursed only as provided in Section 3.03A hereof.

(d)       In
connection with the disbursement of Loan proceeds to the Borrower from the Project Loan Account pursuant to the provisions of this Section
3.02, the Borrower shall comply with each of its covenant obligations pursuant to this Loan Agreement relating to such disbursement of
Loan proceeds to the Borrower, as well as the use of such Loan proceeds by the Borrower.

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 Indenture;

(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 Indenture; and

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(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 I-Bank Bonds allocable to any prepaid or accelerated I-Bank 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 I-Bank Bond proceeds
and income thereon on deposit in the Interest Account (as defined in the Bond Indenture) to pay interest on the I-Bank 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.

(b)       The
Interest on the Loan described in clause (iii) of the definition thereof (i) shall consist of a late charge that is applicable to any
I-Bank Bond Loan Repayment that is received by the Trustee on any date subsequent to its due date and (ii) shall be payable concurrently
with the payment of such I-Bank Bond Loan Repayment in an amount calculated as follows: Such late charge shall equal the greater of twelve
percent (12%) per annum or the Prime Rate plus one-half of one percent (0.50%) per annum with respect to the remaining outstanding principal
amount of the Loan, from the applicable due date with respect to such I-Bank Bond Loan Repayment 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 and as calculated
pursuant to the terms hereof, 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, if any, certified
by the I-Bank pursuant to Section 5.10 of the Bond Indenture. Such amounts shall represent the Borrower’s allocable share of the
interest earnings on certain funds and accounts established under the Bond Indenture, as calculated and determined in accordance with
Section 5.10 of the Bond Indenture.

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

(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, 2022.

(f)       The
“DEP Loan Surcharge or Loan Origination Fee” as defined in Section 8 of Exhibit B attached hereto and made a part hereof,
as additionally identified in Exhibit A-2 attached hereto and made a part hereof, (the “DEP Fee”) shall be paid by the Borrower
to the Trustee on the date indicated therein in satisfaction of the payment obligation of the Borrower to the Department, and the obligation
of the Borrower with respect to the payment of such DEP Fee shall be an obligation of the Borrower under the Borrower Bond and an amount
payable pursuant 

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to this Section 3.03. For purposes of crediting and applying the payment by the Borrower of the DEP Fee upon receipt
thereof as provided hereby, the Trustee shall credit and apply such payment of the DEP Fee pursuant to the terms and provisions of the
Bond Indenture that relate to the payment, crediting and application of the State Administrative Fee (as defined in the Bond Indenture),
notwithstanding that fact that (i) the DEP Fee and the State Administrative Fee are separate and distinct fee payment obligations to be
satisfied by the Borrower, and (ii) as of the date hereof, there is no State Administrative Fee due and payable by the Borrower. The Trustee,
as assignee hereof, hereby agrees to the credit and application of the DEP Fee upon payment thereof as provided hereby.

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

(h)       Each
payment made by the Borrower pursuant to, and in satisfaction of, the requirements of this Section 3.03 shall be made by the Borrower
to the Trustee via an electronic transfer of immediately available funds; provided, however, that upon thirty (30) days prior written
notice to the Borrower, an Authorized Officer of the I-Bank may, in the sole discretion of such Authorized Officer, prescribe an alternative
method by which payments pursuant to, and in satisfaction of, this Section 3.03 shall be made by the Borrower to the Trustee. Such method
as prescribed by an Authorized Officer of the I-Bank may include, without limitation, the automatic debit by the I-Bank or the Trustee
of the respective amounts of such payments, as required by this Section 3.03, from an account that shall be identified by the Borrower
in writing and recorded on file with the I-Bank and the Trustee.

SECTION 3.03A.       Unexpended
Project Funds on Deposit in Project Loan Account. If, on the Project Loan Account Disbursement Deadline, any amounts remain on deposit
in the Borrower’s Project Loan Account (“Unexpended Project Funds”), such Unexpended Project Funds on deposit in the
Borrower’s Project Loan Account shall thereafter be applied by the I-Bank toward the Borrower’s obligation to make the Loan
Repayments next coming due.

SECTION
3.04.       Unconditional Obligations. The obligation of the Borrower to make the Loan Repayments and all other payments
required hereunder and the obligation to perform and observe the other duties, covenants, obligations and agreements on its part contained
herein shall be absolute and unconditional, and shall not be abated, rebated, set-off, reduced, abrogated, terminated, waived, diminished,
postponed or otherwise modified in any manner or to any extent whatsoever while any I-Bank 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 I-Bank or the Trustee to perform and observe any agreement, whether express 

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or implied, or any duty, liability
or obligation arising out of or connected with the Project, this Loan Agreement or the Bond Indenture, or any rights of set-off, recoupment,
abatement or counterclaim that the Borrower might otherwise have against the I-Bank, 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 Indenture.

The Borrower acknowledges
that payment of the I-Bank Bonds by the I-Bank does not constitute payment of the amounts due under this Loan Agreement and the Borrower
Bond.

The Borrower acknowledges
that payment of the I-Bank Bonds from moneys that were originally received by the Trustee pursuant to Section 5.04(1) of the Bond Indenture
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, 2022 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 I-Bank Bonds Security Account (as defined in the Bond Indenture), does not constitute payment of the amounts due under this Loan
Agreement and the Borrower Bond.

SECTION
3.05.       Loan Agreement to Survive Bond Indenture and I-Bank Bonds. The Borrower acknowledges that its duties, covenants,
obligations and agreements hereunder shall survive the discharge of the Bond Indenture applicable to the I-Bank Bonds and shall survive
the payment of the principal and redemption premium, if any, of and the interest on the I-Bank 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 I-Bank Bonds for purposes
of federal 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 I-Bank 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
I-Bank 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 I-Bank 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 I-Bank 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 

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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 I-Bank and the Trustee that the I-Bank and its officers, agents, servants and 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 I-Bank 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), notwithstanding the fact that such statute, by its express
terms would not apply to claims arising under contract with the I-Bank but for the provisions of this subsection

(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 I-Bank 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 I-Bank, the Borrower shall maintain said liability insurance covering the I-Bank and
said directors, employees and officers in good standing; and (ii) the Borrower shall include the I-Bank 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 I-Bank in good standing.

The Borrower shall provide
the I-Bank 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 I-Bank 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 I-Bank 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 I-Bank 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 I-Bank 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 

    -19- 

     

    

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 I-Bank, in its sole discretion, determines that the interests of the owners of the I-Bank Bonds are
not adversely affected by such prepayments, (iii) upon the prior written approval of the I-Bank, and (iv) provided that the Borrower shall
agree to pay all costs and expenses of the I-Bank in connection with such prepayment, including, without limitation, the fees of Bond
Counsel to the I-Bank and any other professional advisors to the I-Bank. In addition, if at the time of such prepayment the I-Bank Bonds
may only be redeemed at the option of the I-Bank upon payment of a premium, the Borrower shall add to its prepayment of I-Bank Bond Loan
Repayments an amount, as determined by the I-Bank, equal to such premium allocable to the I-Bank 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 and agrees that, to the extent permitted by law, any repayments then due and payable on the Loan pursuant
to this Loan Agreement and paid by the Borrower and any repayments then due and payable on the Fund Loan pursuant to the Fund Loan Agreement
and paid by the Borrower shall be applied by the Trustee, first, to the payment obligations of the Borrower with respect to the Loan and,
second, to the payment obligations of the Borrower with respect to the Fund Loan, all in a manner more specifically identified in subsection
(b) hereof. The Borrower agrees not to interfere with any such action by the Trustee with respect to the application of repayments as
set forth herein.

(b)       The
Borrower hereby further acknowledges and agrees that, in the event the Borrower fails or is unable to pay promptly to the I-Bank in full
any I-Bank Bond Loan Repayments pursuant to 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 pursuant to its Fund Loan Agreement, any of which payments
shall be received by the Trustee during the time of any such I-Bank Bond Loan Repayment deficiency, shall be applied by the Trustee first
to satisfy such I-Bank 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, second, to the extent available, to make I-Bank 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 pursuant to its Fund Loan Agreement, and finally, to the extent available, to satisfy the repayment of any administrative
fee pursuant to its Fund Loan Agreement.

(c)       The
Borrower hereby further acknowledges and agrees that any loan repayments paid by the Borrower on its Fund Loan pursuant to its Fund Loan
Agreement shall be applied according to the provisions of the Master Program Trust Agreement.

SECTION
3.09.       Approval of the New Jersey State Treasurer. The Borrower and the I-Bank hereby acknowledge that, prior to or
simultaneously with the Loan Closing, the New 

    -20- 

     

    

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 I-Bank 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.

    -21- 

     

    

ARTICLE
IV

ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND

SECTION
4.01.       Assignment and Transfer by I-Bank.

(a)       The
Borrower hereby expressly acknowledges that, other than the provisions of Section 2.02(d) hereof, the I-Bank’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 I-Bank Bonds
as provided in the Bond Indenture, and that if any Event of Default shall occur, the Trustee, pursuant to the Bond Indenture, shall be
entitled to act hereunder in the place and stead of the I-Bank (subject to the provisions of this Section 4.01(a), below, and of Section
5.07 hereof). The Borrower hereby acknowledges the requirements of the Bond Indenture applicable to the I-Bank 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 I-Bank 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) hereof (provided, however, that in no event shall the I-Bank have the right to accelerate the Borrower Bond in connection
with the enforcement of Section 2.02(d) hereof) and as otherwise provided by the terms and provisions of Section 5.07 hereof.

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

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 I-Bank 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; and (iii) immediately after such assignment, the assignee shall not be in default in the observance or performance of any duties,
covenants, obligations or agreements of the Borrower under this Loan Agreement or the Borrower Bond.

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ARTICLE
V

EVENTS OF DEFAULT AND REMEDIES

SECTION
5.01.       Events of Default. If any of the following events occur, it is hereby defined as and declared to be and to
constitute an “Event of Default”:

(a)       failure
by the Borrower to pay, or cause to be paid, any I-Bank Bond Loan Repayment required to be paid hereunder when due;

(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 subsections (a) and (g) of this Section 5.01, 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 I-Bank, unless the I-Bank
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 I-Bank 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 failure 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, and/or any proceeding with respect to such petition and/or pursuant to any such
law shall occur or be pending (including, without limitation, the operation and administration of the Borrower pursuant to any plan of
reorganization approved and implemented under any such law), unless in the case of any such petition filed against the Borrower or any
such proceeding such petition and such proceeding shall be dismissed within thirty (30) days after such filing and such dismissal shall
be final and not subject to appeal or the further jurisdiction of any court; 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;

    -23- 

     

    

(g)       failure
of the Borrower to observe or perform such additional duties, covenants, obligations, agreements or conditions as are required by the
I-Bank and specified in each of Exhibit F and Exhibit G attached hereto and made a part hereof; and

(h)       the
occurrence of an “Event of Default” pursuant to, and as defined in, (i) the Fund Loan Agreement or (ii) any Construction Financing
Program Loan that may be outstanding.

SECTION
5.02.       Notice of Default. The Borrower shall give the Trustee and the I-Bank prompt telephonic notice, confirmed immediately
thereafter with a written notice, of the occurrence of any Event of Default referred to in Section 5.01(e) or (f) 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 to direct any and all remedies in accordance with the terms of the
Bond Indenture, and the Borrower also acknowledges that the I-Bank shall have the right to take, or to direct the Trustee to take, any
action permitted or required pursuant to the Bond Indenture 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 I-Bank shall, to the extent allowed by applicable
law and to the extent and in the manner set forth in the Bond Indenture, 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 I-Bank 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 I-Bank 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 I-Bank 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 

    -24- 

     

    

Portion and the principal on the Loan and other amounts payable hereunder as such amounts become due and
payable.

SECTION
5.06.       No Remedy Exclusive; Waiver; Notice. No remedy herein conferred upon or reserved to the I-Bank 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 I-Bank 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 I-Bank’s Rights.  Notwithstanding any assignment or transfer of this Loan Agreement pursuant
to the provisions hereof or of the Bond Indenture, or anything else to the contrary contained herein, the I-Bank 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 I-Bank may, in its discretion, deem necessary to enforce the obligations of the Borrower to the I-Bank pursuant
to Section 5.03 hereof.

    -25- 

     

    

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, (i) to the Borrower at the address specified
in Exhibit A-1 attached hereto and made a part hereof and (ii) to the I-Bank and the Trustee at the following respective addresses:

(a)       I-Bank:

New Jersey Infrastructure Bank

3131 Princeton Pike

Building 4, Suite 216

Lawrenceville, New Jersey 08648-2201

Attention: Executive Director

(b)       Trustee:

Zions Bancorporation, National
Association d/b/a Zions Bank

401 Liberty Avenue, Suite 1729

Pittsburgh, Pennsylvania 15222

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 I-Bank 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 I-Bank and the Borrower and without the satisfaction of all conditions set forth in Section 11.12 of the Bond Indenture.
Notwithstanding the conditions set forth in Section 11.12 of the Bond Indenture, (i) Section 2.02(q) hereof may be amended, supplemented
or modified upon the written consent of the I-Bank and the Borrower and without the consent of the Trustee or any holders of the I-Bank
Bonds, and (ii) Exhibit H hereto may be amended, supplemented or modified prior to the execution and delivery thereof as the I-Bank, in
its sole discretion, shall determine to be necessary, desirable or convenient for the purpose of satisfying Rule 15c2-12 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 or any holders
of the I-Bank Bonds.

    -26- 

     

    

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 I-Bank or an Authorized Officer of
the I-Bank, as the case may be, shall be required pursuant to the provisions of this Loan Agreement, such consent or approval may only
be given by the I-Bank or an Authorized Officer of the I-Bank, as the case may be, (i) unless otherwise provided by law or by the rules,
regulations or resolutions of the I-Bank, or (ii) unless expressly delegated to the Trustee, and (iii) except as otherwise provided in
Section 6.09 hereof. Further, whenever the written consent or approval of the I-Bank or an Authorized Officer of the I-Bank, as the case
may be, shall be required pursuant to the provisions of this Loan Agreement, such approval or consent of the I-Bank pursuant to the provisions
hereof may be either granted or withheld by the I-Bank in its sole and absolute discretion.

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 Indenture. This Loan Agreement is executed, among other reasons,
to induce the purchase of the I-Bank 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 I-Bank, the holders of the I-Bank Bonds and the Trustee. The Borrower
covenants and agrees to observe and comply with, and to enable the I-Bank to observe and comply with, all applicable duties, covenants,
obligations and agreements contained in the Bond Indenture.

SECTION
6.10.       Further Assurances. The Borrower shall, at the request of the I-Bank, 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.

SECTION
6.11.       No Personal Liability. The Borrower hereby acknowledges and agrees that, pursuant to and consistent with the
provisions of Section 13 of the Act (N.J.S.A. 58:11B-13), neither the directors of the I-Bank nor any officers of the I-Bank taking any
action with respect to the issuance of the I-Bank Bonds or the making of the Loan pursuant to this Loan Agreement shall be liable personally
with respect to the I-Bank Bonds or the Loan or any matters or transactions related thereto.

    -27- 

     

    

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

 

	 	 	
    NEW JERSEY

    INFRASTRUCTURE BANK

     

     

     

	[SEAL]	 	By:	/s/ Robert A. Briant, Jr.
	 	 	 	Robert A. Briant, Jr.
	
    ATTEST:

     
	 	 	Chairperson
	 	 	 	 
	/s/ David E. Zimmer	 	 	 
	David E. Zimmer	 	 	 
	Assistant Secretary	 	
     

     

     

    MIDDLESEX WATER COMPANY

	
     

    [SEAL]
	 	 	 
	 	 	 	 
	 	 	By:	/s/ A. Bruce O’Conner
	ATTEST:	 	 	Senior Vice President, Treasurer
	
     

     
	 	 	and Chief Financial Officer
	/s/ Jay L. Kooper	 	 	 
	
    Vice President, General Counsel

    and Secretary
	 	 	 

 

[signature page]

    -28-Exhibit 10.41

 

 

 

 

 

 

LOAN AGREEMENT

BY AND BETWEEN

THE STATE OF NEW JERSEY,

ACTING BY AND THROUGH THE NEW JERSEY

DEPARTMENT OF ENVIRONMENTAL PROTECTION,

AND

MIDDLESEX WATER COMPANY

 

(PROJECT NOS. 1225001-025/028)

 

 

 

 

DATED AS OF MAY 1, 2022

    -1- 

     

    

	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	9
	ARTICLE III LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS
	SECTION 3.01.         Loan; Loan Term	14
	SECTION 3.02.         Disbursement of Loan Proceeds	14
	SECTION 3.03.         Amounts Payable	15
	SECTION 3.03A.      Unexpended Project Funds	16
	SECTION 3.04.         Unconditional Obligations	16
	SECTION 3.05.         Loan Agreement to Survive Loan	17
	SECTION 3.06.         Disclaimer of Warranties and Indemnification	17
	SECTION 3.07.         Option to Prepay Loan Repayments	18
	SECTION 3.08.         Priority of Loan and I-Bank Loan	18
	SECTION 3.09.         Approval of the New Jersey State Treasurer	19
	ARTICLE IV ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND
	SECTION 4.01.         Assignment and Transfer by State	20
	SECTION 4.02.         Assignment by Borrower	20
	ARTICLE V EVENTS OF DEFAULT AND REMEDIES
	SECTION 5.01.         Events of Default	21
	SECTION 5.02.         Notice of Default	22

 

    -i- 

     

    

 

	TABLE OF CONTENTS

	Page

	SECTION 5.03.         Remedies on Default	22
	SECTION 5.04.         Attorneys’ Fees and Other Expenses	22
	SECTION 5.05.         Application of Moneys	22
	SECTION 5.06.         No Remedy Exclusive; Waiver; Notice	22
	SECTION 5.07.         Retention of State’s Rights	23
	ARTICLE VI MISCELLANEOUS
	SECTION 6.01.         Notices	24
	SECTION 6.02.         Binding Effect	24
	SECTION 6.03.         Severability	24
	SECTION 6.04.         Amendments, Supplements and Modifications	24
	SECTION 6.05.         Execution in Counterparts	25
	SECTION 6.06.         Applicable Law and Regulations	25
	SECTION 6.07.         Consents and Approvals	25
	SECTION 6.08.         Captions	25
	SECTION 6.09.      Further Assurances	25

 

	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 New Jersey Water Bank	G-1
			 

    -ii- 

     

    

NEW JERSEY WATER
BANK FUND LOAN AGREEMENT

THIS LOAN AGREEMENT,
made and entered into as of May 1, 2022 by and between THE STATE OF NEW JERSEY, acting by and through the New Jersey Department of
Environmental Protection, and the Borrower (capitalized terms used in this Loan Agreement shall have, unless the context otherwise requires,
the meanings ascribed thereto in Section 1.01 hereof);

WITNESSETH THAT:

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

WHEREAS, the State
has approved the Borrower’s application for a Loan from Federal Funds, if and when received by and available to the State, and moneys
from repayments of loans previously made from such Federal Funds, in the amount of the loan commitment set forth in Exhibit A-2 attached
hereto and made a part hereof to finance a portion of the Costs of the Project;

WHEREAS, the New
Jersey State Legislature has approved an appropriations act that authorizes an expenditure of said proceeds, Federal Funds or related
moneys to finance a portion of the Costs of the Project;

WHEREAS, the Borrower,
in accordance with the Business Corporation Law and all other applicable law, will issue a Borrower Bond to the State evidencing and securing
said Loan at the Loan Closing;

WHEREAS, in accordance
with the New Jersey Infrastructure Trust Act, P.L. 1985, c. 334, as amended, and the Regulations, the Borrower has been awarded an I-Bank
Loan for a portion of the Costs of the Project plus, if applicable to the Borrower, capitalized interest on the I-Bank Loan and certain
costs of issuance.

NOW, THEREFORE, for
and in consideration of the award of the Loan by the State, the Borrower agrees to complete the Project and to perform under this Loan
Agreement in accordance with the conditions, covenants and procedures set forth herein and attached hereto as part hereof, as follows:

    -1- 

     

    

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:

“Administrative
Fee” means an annual fee of up to one percent (1.0%) of the initial principal amount of the Loan or such lesser amount, if any,
as may be authorized by any act of the New Jersey State Legislature and as the State may approve from time to time.

“Authorized Officer”
means (i) in the case of the I-Bank, the Chairman, Vice-Chairman or Executive Director of the I-Bank, or any other person or persons
designated by the I-Bank by resolution to act on behalf of the I-Bank pursuant to this Loan Agreement, and (ii) in
the case of the Borrower, any person or persons authorized pursuant to a resolution of the board of directors of the Borrower to
perform any act or execute any document relating to the Loan, the Borrower Bond or this Loan Agreement.

“Bond Act”
means, as applicable, (i) the Water Supply Bond Act of 1981, P.L. 1981, c. 261, as the same may from time to time be amended and supplemented,
(ii) the Wastewater Treatment Bond Act of 1985, P.L. 1985, c. 329, as the same may from time to time be amended and supplemented, (iii)
the Stormwater Management and Combined Sewer Overflow Abatement Bond Act of 1989, P.L. 1989, c. 181, as the same may from time to time
be amended and supplemented, (iv) the Green Acres, Clean Water, Farmland and Historic Preservation Bond Act of 1992, P.L. 1992, c. 88,
as the same may from time to time be amended and supplemented, and (v) the Dam, Lake, Stream, Flood Control, Water Resources, and Wastewater
Treatment Project Bond Act of 2003, P.L. 2003, c.162, as the same may from time to time be amended and supplemented.

“Bond Counsel”
means a law firm appointed or approved by the State, 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 Bond”
means the general obligation bond, note, debenture or other evidence of indebtedness authorized, executed, attested and delivered by the
Borrower to the State and authenticated on behalf of the Borrower to evidence and secure the Borrower’s obligations to pay the Loan
Repayments and all other amounts due and owing by the Borrower under this Loan Agreement, a specimen of which is attached hereto as Exhibit
D and made a part hereof.

“Borrowers”
means any other Local Government Unit or Private Entity (as such terms are defined in the Regulations) authorized to construct, operate
and maintain Environmental Infrastructure Facilities that have entered into Loan Agreements with the State pursuant to which the State
will make Loans to such recipients from Federal Funds.

    -2- 

     

    

"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.

“Construction
Financing Program Loan” means any loan that may have been made on the date of the Loan Closing by the I-Bank to the Borrower
pursuant to the Construction Financing Program of the I-Bank for the purpose of financing a portion of the Costs of the Project, and,
if made and outstanding, shall be identified and described in Exhibit F hereto.

“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 State.

“Department”
means the New Jersey Department of Environmental Protection.

“Environmental
Infrastructure Facilities” means Water Supply Facilities (as such term is 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, a portion of the Costs of which is being financed or refinanced by the State through
the making of the Loan pursuant to the terms and provisions of this Loan Agreement. for which the Borrower is borrowing the Loan under
this Loan Agreement.

“Event of Default”
means any occurrence or event specified in Section 5.01 hereof.

“Federal Funds”
means those funds awarded to the State pursuant to the Clean Water Act (33 U.S.C. §1251 et seq.) or the Safe Drinking Water
Act (42 U.S.C. §300f et seq.), as the same may from time to time be amended and supplemented.

“I-Bank”
means the New Jersey Infrastructure Bank, a public body corporate and politic with corporate succession duly created and validly existing
under and by virtue of P.L. 1985, c. 334, as amended (N.J.S.A. 58:11B-1 et seq.).

“I-Bank Loan”
means the loan made to the Borrower by the I-Bank pursuant to the I-Bank Loan Agreement.

“I-Bank Loan Agreement”
means the loan agreement by and between the Borrower and the I-Bank dated as of May 1, 2022 to finance or refinance a portion of the Costs
of the Project.

“Loan”
means the loan made by the State to the Borrower to finance or refinance a portion of the Costs of the Project pursuant to this Loan Agreement.
For all purposes of this 

    -3- 

     

    

Loan Agreement, the principal amount of the Loan at any time shall be the amount of the loan commitment set forth
in Exhibit A-2 attached hereto and made a part hereof (such amount being also specified as the initial aggregate principal amount of the
Borrower Bond) less any amount of such principal amount that has been repaid by the Borrower under this Loan Agreement and less any adjustment
made for low bid or final building costs pursuant to the provisions of N.J.A.C. 7:22-3.26 and the appropriations act of the New Jersey
State Legislature authorizing the expenditure of moneys to finance a portion of the Costs of the Project.

“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.

“Loan Agreements”
means any other loan agreements entered into by and between the State and one or more of the Borrowers pursuant to which the State will
make Loans to such Borrowers from Federal Funds.

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

“Loan Repayments”
means the sum of (i) the repayments of the principal amount of the Loan payable by the Borrower pursuant to Section 3.03(a) of this Loan
Agreement and (ii) any late charges incurred hereunder, but shall not include the Administrative Fee.

“Loan Term”
means the term of this Loan Agreement provided in Sections 3.01 and 3.03 hereof and in Exhibit A-2 attached hereto and made a part hereof.

“Loans”
means the loans made by the State to the Borrowers under the Loan Agreements from moneys from Federal Funds.

“Master
Program Trust Agreement” means that certain Master Program Trust Agreement, dated as of November 1, 1995, by and among the I-Bank,
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
I-Bank, as the same may be amended and supplemented from time to time in accordance with its terms.

“Prime Rate”
means the prevailing commercial interest rate announced by the Trustee from time to time in the State as its prime lending rate.

“Project”
means the Environmental Infrastructure Facilities of the Borrower described in Exhibit A-1 attached hereto and made a part hereof, which
constitutes a project for which the State is permitted to make a loan to the Borrower pursuant to the Regulations, a portion of the Costs
of which is being financed or refinanced by the State through the making of the Loan

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 pursuant to the terms and provisions of this Loan
Agreement and which may be identified under either the Drinking Water or Clean Water Project Lists with the Project Number specified in
Exhibit A-1 attached hereto.

“Regulations”
means the rules and regulations, as applicable, now or hereafter promulgated under N.J.A.C. 7:22-3 et seq., 7:22-4 et seq.,
7:22-5 et seq., 7:22-6 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, acting, unless otherwise specifically indicated, by and through the Department, and its successors and
assigns.

“State Fund”
means, as applicable, the Clean Water State Revolving Fund, the Wastewater Treatment Fund, the 1992 Wastewater Treatment Fund, the
Stormwater Management and Combined Sewer Overflow Abatement Fund, the 1992 Dam Restoration and Clean Water Trust Fund, the 2003 Dam, Lake
and Stream Project Revolving Loan Fund, the 2003 Water Resources and Wastewater Treatment Fund or the Water Supply Fund as defined in
and as established pursuant to the applicable Bond Act.

“Trustee”
means, initially, Zions Bancorporation, National Association d/b/a Zions Bank, the Trustee appointed by the I-Bank and its successors
as Trustee under the Bond Indenture (as defined in the I-Bank Loan Agreement), as provided in Article X of the Bond Indenture.

“Unexpended
Project Funds” shall have the meaning ascribed thereto in Section 3.03A hereof.

(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 all genders.

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ARTICLE
II

REPRESENTATIONS AND COVENANTS OF BORROWER

SECTION
2.01.       
Representations of Borrower. The Borrower represents for the benefit of the State as follows:

(a)            
Organization and Authority.

(i)         
The Borrower is a corporation duly created and validly existing pursuant to the Constitution and statutes of the State of New Jersey,
including the Business Corporation Law.

(ii)             
The officers of the Borrower who are contemporaneously herewith performing or have previously performed any action contemplated
in this Loan Agreement either are or, at the time any such action was performed, were the duly appointed or elected officers of such Borrower
empowered by applicable New Jersey law and, if applicable, authorized by resolution of the Borrower to perform such actions. To the extent
any such action was performed by an officer who is no longer the duly acting officer of such Borrower, all such actions previously taken
by such officer remain in full force and effect.

(iii)           
The Borrower has full legal right and authority and all necessary licenses and permits required as of the date hereof to own, operate
and maintain its Environmental Infrastructure System, to carry on its activities relating thereto, to execute, attest and deliver this
Loan Agreement and the Borrower Bond, to authorize the authentication of the Borrower Bond, to sell the Borrower Bond to the State, to
undertake and complete the Project and to carry out and consummate all transactions contemplated by this Loan Agreement.

(iv)            
The proceedings of the Borrower’s board of directors approving this Loan Agreement and the Borrower Bond, authorizing the
execution, attestation and delivery of this Loan Agreement and the Borrower Bond, authorizing the sale of the Borrower Bond to the State,
authorizing the authentication of the Borrower Bond on behalf of the Borrower and authorizing the Borrower to undertake and complete the
Project, including, without limitation, the Borrower Bond Resolution (collectively, the “Proceedings”), have been duly and
lawfully adopted in accordance with the Business Corporation Law and other applicable New Jersey law at a meeting or meetings that were
duly called and held in accordance with the Borrower By-Laws and at which quorums were present and acting throughout.

(v)       
By official action of the Borrower taken prior to or concurrent with the execution and delivery hereof, including, without limitation,
the Proceedings, the Borrower has duly authorized, approved and consented to all necessary action to be taken by the Borrower for: (A)
the execution, attestation, delivery and performance of this Loan Agreement and the transactions contemplated hereby; (B) the issuance
of the Borrower Bond and the sale thereof to the State upon the terms set forth herein; and (C) 

    -6- 

     

    

the execution, delivery and due performance
of any and all other certificates, agreements and instruments that may be required to be executed, delivered and performed by the Borrower
in order to carry out, give effect to and consummate the transactions contemplated by this Loan Agreement.

(vi)            
This Loan Agreement and the Borrower Bond have each been duly authorized by the Borrower and duly executed, attested and delivered
by Authorized Officers of the Borrower, and the Borrower Bond has been duly sold by the Borrower to the State, duly authenticated by the
trustee or paying agent, if applicable, under the Borrower Bond Resolution and duly issued by the Borrower in accordance with the terms
of the Borrower Bond Resolution; and assuming that the State has all the requisite power and authority to authorize, execute, attest and
deliver, and has duly authorized, executed, attested and delivered, this Loan Agreement, and assuming further that this Loan Agreement
is the legal, valid and binding obligation of the State, enforceable against the State in accordance with its terms, each of this Loan
Agreement and the Borrower Bond constitutes a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in
accordance with its respective terms, except as the enforcement thereof may be affected by bankruptcy, insolvency or other laws or the
application by a court of legal or equitable principles affecting creditors' rights; and the information contained under "Description
of Loan" in Exhibit A-2 attached hereto and made a part hereof is true and accurate in all respects.

(b)       
Full Disclosure. There is no fact that the Borrower has not disclosed to the State in writing on the Borrower’s application
for the Loan or otherwise that materially adversely affects or (so far as the Borrower can now foresee) that will materially adversely
affect the properties, activities, prospects or condition (financial or otherwise) of the Borrower or its Environmental Infrastructure
System, or the ability of the Borrower to make all Loan Repayments or otherwise to observe and perform its duties, covenants, obligations
and agreements under this Loan Agreement and the Borrower Bond.

(c)       
Pending Litigation. There are no proceedings pending or, to the knowledge of the Borrower, threatened against or affecting
the Borrower in any court or before any governmental authority or arbitration board or tribunal that, if adversely determined, would materially
adversely affect (i) the undertaking or completion of the Project, (ii) the properties, activities, prospects or condition (financial
or otherwise) of the Borrower or its Environmental Infrastructure System, (iii) the ability of the Borrower to make all Loan Repayments,
(iv) the authorization, execution, attestation or delivery of this Loan Agreement or the Borrower Bond, (v) the issuance of the Borrower
Bond and the sale thereof to the State, (vi) the adoption of the Borrower Bond Resolution, or (vii) the Borrower’s ability otherwise
to observe and perform its duties, covenants, obligations and agreements under this Loan Agreement and the Borrower Bond, which proceedings
have not been previously disclosed in writing to the State either in the Borrower’s application for the Loan or otherwise.

(d)       
Compliance with Existing Laws and Agreements. (i) The authorization, execution, attestation and delivery of this Loan Agreement
and the Borrower Bond by the Borrower, (ii) the authentication of the Borrower Bond by the trustee or paying agent under the Borrower
Bond Resolution, as the case may be, and the sale of the Borrower Bond to the State, 

    -7- 

     

    

(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 under the Borrower
Bond, (v) the consummation of the transactions provided for in this Loan Agreement, the Borrower Bond Resolution and the Borrower Bond,
and (vi) the undertaking and completion of the Project will not (A) other than the lien, charge or encumbrance created hereby, by the
Borrower Bond, by the Borrower Bond Resolution and by any other outstanding debt obligations of the Borrower that are at parity with the
Borrower Bond as to lien on, and source and security for payment thereon from, the revenues of the Borrower’s Environmental Infrastructure
System, result in the creation or imposition of any lien, charge or encumbrance upon any properties or assets of the Borrower pursuant
to, (B) result in any breach of any of the terms, conditions or provisions of, or (C) constitute a default under, any existing resolution,
outstanding debt or lease obligation, trust agreement, indenture, mortgage, deed of trust, loan agreement or other instrument to which
the Borrower is a party or by which the Borrower, its Environmental Infrastructure System or any of its properties or assets may be bound,
nor will such action result in any violation of the provisions of the charter or other document pursuant to which the Borrower was established
or any laws, ordinances, injunctions, judgments, decrees, rules, regulations or existing orders of any court or governmental or administrative
agency, authority or person to which the Borrower, its Environmental Infrastructure System or its properties or operations is subject.

(e)       
No Defaults. No event has occurred and no condition exists that, upon the authorization, execution, attestation and delivery
of this Loan Agreement and the Borrower Bond, the issuance of the Borrower Bond and the sale thereof to the State, the adoption of the
Borrower Bond Resolution or the receipt of the amount of the Loan, would constitute an Event of Default hereunder. The Borrower is not
in violation of, and has not received notice of any claimed violation of, any term of any agreement or other instrument to which it is
a party or by which it, its Environmental Infrastructure System or its properties may be bound, which violation would materially adversely
affect the properties, activities, prospects or condition (financial or otherwise) of the Borrower or its Environmental Infrastructure
System or the ability of the Borrower to make all Loan Repayments, to pay all other amounts due hereunder or otherwise to observe and
perform its duties, covenants, obligations and agreements under this Loan Agreement and the Borrower Bond.

(f)        
Governmental Consent. The Borrower has obtained all permits and approvals required to date by any governmental body or officer
(i) for the authorization, execution, attestation and delivery of this Loan Agreement and the Borrower Bond, (ii) for the issuance of
the Borrower Bond and the sale thereof to the State, (iii) for the adoption of the Borrower Bond Resolution, (iv) for the making, observance
and performance by the Borrower of its duties, covenants, obligations and agreements under this Loan Agreement and the Borrower Bond,
and (v) for the undertaking or completion of the Project and the financing or refinancing thereof, including, but not limited to, if required,
the approval by the New Jersey Board of Public Utilities (the “BPU”) of the issuance by the Borrower of the Borrower Bond
to the State and any other approvals required therefor by the BPU; and the Borrower has complied with all applicable provisions of law
requiring any notification, declaration, filing or registration with any governmental body or officer in connection with the making, observance
and performance by the Borrower of its duties, covenants, obligations and agreements under this Loan Agreement and the Borrower Bond or
with the undertaking or completion of the Project and the financing or 

    -8- 

     

    

refinancing thereof. No consent, approval or authorization of,
or filing, registration or qualification with, any governmental body or officer that has not been obtained is required on the part of
the Borrower as a condition to the authorization, execution, attestation and delivery of this Loan Agreement and the Borrower Bond, the
issuance of the Borrower Bond and the sale thereof to the State, the undertaking or completion of the Project or the consummation of any
transaction herein contemplated.

(g)       
Compliance with Law. The Borrower:

(i)         
is in compliance with all laws, ordinances, governmental rules and regulations to which it is subject, the failure to comply with
which would materially adversely affect (A) the ability of the Borrower to conduct its activities or to undertake or complete the Project,
(B) the ability of the Borrower to make the Loan Repayments and to pay all other amounts due hereunder, or (C) the condition (financial
or otherwise) of the Borrower or its Environmental Infrastructure System; and

(ii)             
has obtained all licenses, permits, franchises or other governmental authorizations presently necessary for the ownership of its
properties or for the conduct of its activities that, if not obtained, would materially adversely affect (A) the ability of the Borrower
to conduct its activities or to undertake or complete the Project, (B) the ability of the Borrower to make the Loan Repayments and to
pay all other amounts due hereunder, or (C) the condition (financial or otherwise) of the Borrower or its Environmental Infrastructure
System.

(h)       
Use of Proceeds. The Borrower will apply the proceeds of the Loan from the State as described in Exhibit B attached hereto
and made a part hereof (i) to finance or refinance a portion of the Costs of the Project; and (ii) where applicable, to reimburse the
Borrower for a portion of the Costs of the Project, which portion was paid or incurred in anticipation of reimbursement by the State from
proceeds of the Loan and is eligible for such reimbursement pursuant to the Regulations, the Code and any other applicable law. All of
such costs constitute Costs for which the State is authorized to make Loans to the Borrower pursuant to the Regulations.

SECTION
2.02.       
Particular Covenants of Borrower.

(a)       
Promise to Pay. The Borrower unconditionally 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 of the Loan and the Borrower Bond, and all other amounts
due under this Loan Agreement and the Borrower Bond according to their respective terms.

(b)       
Performance Under Loan Agreement; Rates. The Borrower covenants and agrees (i) to comply with all applicable state and federal
laws, rules and regulations in the performance of this Loan Agreement; (ii) to maintain its Environmental Infrastructure System in good
repair and operating condition; (iii) to cooperate with the State in the observance and performance of the respective duties, covenants,
obligations and agreements of the Borrower and the State under this Loan Agreement; and (iv) to establish, levy and collect rents, rates
and other charges for the 

    -9- 

     

    

products and services provided by its Environmental Infrastructure System, which rents, rates and other charges,
together with any other moneys available for that purpose, shall be at least sufficient (A) to meet the operation and maintenance expenses
of its Environmental Infrastructure System, and (B) 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 if any on, the Borrower Bond, plus all other amounts due hereunder.

(c)       
Revenue Obligation; No Prior Pledges. The Borrower shall not be required to make payments under this Loan Agreement except
from the revenues of its Environmental Infrastructure System and from such other funds of such Environmental Infrastructure System legally
available therefor and from any other sources pledged to such payment pursuant to subsection (a) of this Section 2.02. In no event shall
the Borrower be required to make payments under this Loan Agreement from any revenues or receipts not derived from its Environmental Infrastructure
System or pledged pursuant to subsection (a) of this Section 2.02. Except for (i) loan repayments required with respect to the I-Bank
Loan, (ii) the debt service on any future bonds or notes of the Borrower issued at parity with the Borrower Bond under the Borrower Bond
Resolution, and (iii) the debt service on any bonds, notes or evidences of indebtedness of the Borrower at parity with the Borrower Bond
under the Borrower Bond Resolution and currently outstanding or issued on the date hereof, the revenues derived by the Borrower from its
Environmental Infrastructure System, after the payment of all costs of operating and maintaining the Environmental Infrastructure System,
are and will be free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with,
the obligation of the Borrower to make Loan Repayments under this Loan Agreement and the Borrower Bond, and all corporate or other action
on the part of the Borrower to that end has been and will be duly and validly taken.

(d)       
Completion of Project and Provision of Moneys Therefor. The Borrower covenants and agrees to exercise its best efforts in
accordance with prudent environmental infrastructure utility practice to complete the Project and to accomplish such completion on or
before the Project Completion Date. In undertaking and completing the Project, the Borrower covenants and agrees to comply with each of
the terms and provisions contained herein, including, without limitation, Section 2.02(h)(ii) hereof and the Exhibits hereto (including,
without limitation, Exhibit G hereto). In order to complete the Project in satisfaction of the terms and provisions hereof, including,
without limitation, Section 2.02(h)(ii) hereof and the Exhibits hereto, the Borrower hereby covenants and agrees to provide from its own
fiscal resources all moneys, in excess of the total amount of loan proceeds it receives pursuant to the Loan and the I-Bank Loan, as well
as any outstanding Construction Financing Program Loan, that are required in order to complete the Project.

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

(f)        
Reserved.

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(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 or certified public accountant, which may be part of the annual audit of the General Records of the Borrower. Such System
Records and General Records shall be made available for inspection by the State at any reasonable time upon prior written notice, and
a copy of such annual audit(s) therefor, including all written comments and recommendations of such accountant, shall be furnished to
the State within 150 days of the close of the fiscal year being so audited, or such additional period
of time as shall be consented to by the State, in the sole and absolute discretion of the State, subject to the application of applicable
law relating to such additional period of time for the Borrower to complete its audit.

(ii)             
Within thirty (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 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 State. 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, 5 or 6 or on a date later than the 180th day after the Loan Closing. In addition, all costs described in
N.J.A.C. 7:22-5.11(a) 3, 4, 5, and 6 and paid by the Borrower from a source other than the proceeds of the Loan shall be paid on a date
not later than the 180th day after Loan Closing. 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 Loan. The Borrower shall make
such records available to the State within fifteen (15) days of any request by the State. Notwithstanding any other provision hereof to
the contrary, the Borrower may only submit a requisition for Loan proceeds from the Allowance for Administrative Costs within ninety (90)
days of the Loan Closing.

(i)         
Inspections; Information. The Borrower shall permit the State (and any party designated by the State to act on its behalf
or to assist it, including, without limitation, its 

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professional advisors), at any and all reasonable times during construction of the
Project and, thereafter, upon prior written notice, (i) to visit, inspect and examine the property constituting the Project and the site
on which the Project is located, and (ii) to inspect (and make and retain copies of) any Borrower accounts, books, records, correspondence
and files, including, without limitation, Borrower records regarding contracts, receipts, disbursements, investments and the overall financial
standing of the Borrower, and any other matters related to the Borrower, the Project and the forgoing list of deliverables. In furtherance
of the intent of this subsection, the Borrower shall promptly prepare and provide such written reports and informational summaries as
the State may reasonably require.

(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, or to, its Environmental Infrastructure
System at least to the extent that similar insurance is typically carried, and considered commercially reasonable, 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 regulatory requirements
applicable to the Borrower and its Environmental Infrastructure System.

(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 that it will supply to the State a certificate from a licensed professional
engineer authorized to practice in the State stating that such building cost is a reasonable and accurate estimation and that the useful
life of the Project exceeds the maturity date of the Borrower Bond.

(l)         
Delivery of Documents. Concurrently with the delivery of this Loan Agreement (as previously authorized, executed and attested)
at the Loan Closing, the Borrower will cause to be delivered to the State each of the following items:

(i)         
an opinion of the Borrower’s bond counsel substantially in the form of Exhibit E hereto; provided, however, that the State
may permit portions of such opinion to be rendered by general counsel to the Borrower and may permit variances in such opinion from the
form set forth in Exhibit E if, in the sole discretion of the State, such variances are acceptable
to the State;

(ii)             
counterparts of this Loan Agreement as previously executed and attested by the parties hereto;

(iii)           
copies of those resolutions finally adopted by the board of directors of the Borrower and requested by the State, including, without
limitation, (A) the resolution of the Borrower authorizing the execution, attestation and delivery of this Loan Agreement, (B) the Borrower
Bond Resolution, as amended and supplemented as of the date of the Loan Closing, authorizing the execution, attestation, authentication,
sale and delivery of the Borrower Bond to the State, (C) the resolution of the Borrower confirming the details of the sale of the Borrower
Bond to the State, each of said resolutions of the Borrower being certified by an Authorized Officer of the Borrower as of the date of
the Loan 

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Closing, (D) the resolution of the BPU approving the issuance by the Borrower of the Borrower Bond to the State and setting forth
any other approvals required therefor by the BPU, if applicable, and (E) any other Proceedings; and

(iv)            
the certificates of insurance coverage as required pursuant to the terms of Section 3.06(c) hereof and such other certificates,
documents, opinions and information as the State may require in Exhibit F hereto, if any.

(m)            
Execution and Delivery of Borrower Bond. Concurrently with the delivery of this Loan Agreement at the Loan Closing, the
Borrower shall also deliver to the State the Borrower Bond, as previously executed, attested and, if applicable, authenticated.

(n)       
Notice of Material Adverse Change. The Borrower shall promptly notify the State of any material adverse change in the properties,
activities, prospects or condition (financial or otherwise) of the Borrower or its Environmental Infrastructure System, or in the ability
of the Borrower to make all Loan Repayments and otherwise to observe and perform its duties, covenants, obligations and agreements under
this Loan Agreement and the Borrower Bond.

(o)       
Continuing Representations. The representations of the Borrower contained herein shall be true at the time of the execution
of this Loan Agreement and at all times during the term of this Loan Agreement.

(p)       
Additional Covenants and Requirements. (i) No later than the Loan Closing and, if necessary, in connection with the making
of the Loan, additional covenants and requirements have been included in Exhibit F hereto and made a part hereof. Such covenants and requirements
may include, but need not be limited to, the maintenance of specified levels of Environmental Infrastructure System rates, the issuance
of additional debt of the Borrower, and the transfer of revenues and receipts from the Borrower’s Environmental Infrastructure System.
The Borrower agrees to observe and comply with each such additional covenant and requirement, if any, included in Exhibit F hereto. (ii)
Additional defined terms, covenants, representations and requirements have been included in Schedule A attached hereto and made a part
hereof. Such additional defined terms, covenants, representations and requirements are incorporated in this Loan Agreement by reference
thereto as if set forth in full herein and the 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.

    -13- 

     

    

ARTICLE
III

LOAN TO BORROWER; AMOUNTS PAYABLE; GENERAL AGREEMENTS

SECTION
3.01.       
Loan; Loan Term.

(a)       
The State hereby agrees (i) to make the Loan as described in Exhibit A-2 attached hereto and made a part hereof, to the Borrower,
and (ii) to disburse the proceeds of the Loan to the Borrower in accordance with Section 3.02 hereof. The Borrower hereby agrees to borrow
and accept the Loan from the State upon the terms set forth in Exhibit A-2 attached hereto and made a part hereof. The Borrower agrees
that the aggregate principal amount set forth in Exhibit A-2 hereto shall constitute the initial principal amount of the Loan (as the
same may be adjusted downward in accordance with the definition thereof), and the State shall have no obligation thereafter to loan any
additional amounts to the Borrower.

(b)       
Notwithstanding the provisions of subsection (a) of this Section 3.01 to the contrary, the State shall be under no obligation (i)
to make the Loan to the Borrower if (1) at the Loan Closing, the Borrower does not deliver to the State the Borrower Bond and such other
documents as are required pursuant to Section 2.02(l) hereof, or (2) an Event of Default has occurred and is continuing pursuant to this
Loan Agreement, or (ii) to disburse the proceeds of the Loan to the Borrower in accordance with Section 3.02 hereof, unless each of the
conditions precedent to such disbursement, as set forth in Section 3.02 hereof, have been satisfied in full.

(c)       
The Borrower shall have no legal or equitable interest in the Federal Funds received by and available to the State or in moneys
from repayments of loans previously made from Federal Fund by the State.

(d)       
The Borrower shall use the proceeds of the Loan strictly in compliance with the provisions of Section 2.01(h) hereof.

(e)       
The payment obligations of the Borrower created pursuant to the terms of this Loan Agreement are secured by the Borrower Bond.
The obligations of the Borrower to pay the principal of and other amounts due under the Borrower Bond are each direct, general, irrevocable
and unconditional obligations of the Borrower payable from any source legally available to the Borrower in accordance with the terms of
and to the extent provided in the Borrower Bond Resolution.

SECTION
3.02.       
Disbursement of Loan Proceeds.

(a)       
The State shall disburse Federal Funds to the Borrower (i) upon receipt of a requisition executed by an Authorized Officer of the
Borrower in a form satisfying the requirements of the Regulations, and (ii) subject to the schedule limitations set forth in subsection
(c) of this Section 3.02.

(b)       
The State shall not be under any obligation to disburse any Loan proceeds to the Borrower pursuant to this Loan Agreement, unless:

    -14- 

     

    

(i)         
the Loan Closing shall have occurred on the date established therefor by the State;

(ii)       
there shall be Federal Funds for disbursement, as determined by the State in its sole and absolute discretion;

(iii)      
in accordance with the “New Jersey Infrastructure Trust Act”, P.L. 1985, c. 334, as amended (N.J.S.A. 58:11B-1 et
seq.), and the Regulations, the Borrower shall have timely applied for, shall have been awarded and, prior to or simultaneously with
the Loan Closing, shall have closed an I-Bank Loan for a portion of the Allowable Costs (as defined in such Regulations) of the Project,
plus the amount of: (A) capitalized interest during the Project construction period, if any, (B) certain issuance expenses related thereto,
and (C) if applicable, an amount sufficient to pay the interest that accrued on any short-term loan by the I-Bank to the Borrower;

(iv)      
the Borrower shall have on hand moneys to pay for (A) that portion of the total Costs of the Project that is not eligible to be
funded from the Loan or the I-Bank Loan or any outstanding Construction Financing Program Loan, and/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 I-Bank, respectively, for the Loan and
the I-Bank Loan and any outstanding Construction Financing Program Loan; and

(v)       
no Event of Default nor any event that, with the passage of time or service of notice or both, would constitute an Event of Default
shall have occurred and be continuing hereunder.

(c)       
Notwithstanding any provision of this Loan Agreement to the contrary, the State shall not disburse Loan proceeds to the Borrower
from the State Fund pursuant to the provisions of this Section 3.02 at any time on or after the State Fund Disbursement Deadline, and,
as of such date, any Loan proceeds that remain on deposit in the State Fund shall no longer be available to the Borrower via the disbursement
procedures of this Section 3.02, but shall be allocated only as provided in Section 3.03A hereof.

(d)       
In connection with the disbursement of Loan proceeds to the Borrower from the State Fund pursuant to the provisions of this Section
3.02, the Borrower shall comply with each of its covenant obligations pursuant to this Loan Agreement relating to such disbursement of
Loan proceeds to the Borrower, as well as the use of such Loan proceeds by the Borrower, including without limitation, the provisions
of Section 2.02(h)(ii) hereof.

SECTION
3.03.       
Amounts Payable.

(a)       
The Borrower shall repay the Loan at zero-interest in principal installments payable to the Trustee semiannually on the Principal
Payment Dates, in accordance with the schedule set forth in Exhibit A-2 attached hereto and made a part hereof, as the same may be amended
or modified by the State, in particular, without limitation, to make any adjustments to the amount of the Loan in accordance with the
definition thereof; provided, however, that the amount of any reduction in the principal amount of the Loan pursuant to N.J.A.C. 7:22-3.26
shall be credited to the principal payments set forth in Exhibit A-2 in inverse order of their maturity. 

    -15- 

     

    

The obligations of the Borrower
under the Borrower Bond shall be deemed to be amounts payable under this Section 3.03. Each payment made to the Trustee pursuant to the
Borrower Bond shall be deemed to be a credit against the corresponding obligation of the Borrower under this Section 3.03, and any such
payment made to the Trustee shall fulfill the Borrower’s obligation to pay such amount hereunder and under the Borrower Bond. Each
payment made to the Trustee pursuant to this Section 3.03 shall be applied to the principal of the Loan.

(b)       
In addition to the principal payments on the Loan required by subsection (a) of this Section 3.03, the Borrower shall pay a late
charge that is applicable to any such payment that is received by the Trustee on any date subsequent to its due date, which late charge
shall be payable concurrently with the payment of such Loan principal payment in an amount calculated as follows: Such late charge shall
equal the greater of twelve percent (12%) per annum or the Prime Rate plus one-half of one percent (0.50%) per annum with respect to the
remaining outstanding principal amount of the Loan from the applicable due date with respect to such Loan repayment to the date it is
actually paid; provided, however, that such late charge payable on the Loan, as calculated pursuant to the terms hereof, shall not be
in excess of the maximum interest rate permitted by law.

(c)       
In addition to the Loan Repayments payable under subsections (a) and (b) of this Section 3.03, the Borrower shall pay one-half
of the Administrative Fee, if any, to the Trustee semiannually on each February 1 and August 1, commencing August 1, 2022.

(d)       
Each payment made by the Borrower pursuant to, and in satisfaction of, the requirements of this Section 3.03 shall be made by the
Borrower to the Trustee via an electronic transfer of immediately available funds; provided, however, that upon thirty (30) days prior
written notice to the Borrower, the State may, in its sole discretion, prescribe an alternative method by which payments pursuant to,
and in satisfaction of, this Section 3.03 shall be made by the Borrower to the Trustee. Such method as prescribed by the State may include,
without limitation, the automatic debit by the State or the Trustee of the respective amounts of such payments, as required by this Section
3.03, from an account that shall be identified by the Borrower in writing and recorded on file with the State.

SECTION 3.03A.        
Unexpended Project Funds. If, on the State Fund Disbursement Deadline, any amounts remain on deposit in the State Fund that
are allocable to the Borrower for its Project (“Unexpended Project Funds”), such Unexpended Project Funds on deposit in the
State Fund shall thereafter be applied, as follows: the Unexpended Project Funds shall be applied by the State as a prepayment of the
Borrower’s Loan Repayments, and shall be applied to the principal payments on the Loan in inverse order of their maturity.

SECTION
3.04.       
Unconditional Obligations. The obligation of the Borrower to make the Loan Repayments and all other payments
required hereunder and the obligation to perform and observe the other duties, covenants, obligations and agreements on its part contained
herein shall be absolute and unconditional, and shall not be abated, rebated, set-off, reduced, abrogated, terminated, waived, diminished,
postponed or otherwise modified in any manner or to any extent whatsoever while any Loan Repayments remain unpaid, for any reason, regardless
of any contingency, act of God, event or cause whatsoever, including (without limitation) any acts or circumstances that may constitute
failure of consideration, eviction or 

    -16- 

     

    

constructive eviction, the taking by eminent domain or destruction of or damage to the Project or
Environmental Infrastructure System, commercial frustration of the purpose, any change in the laws of the United States of America or
of the State or any political subdivision of either or in the rules or regulations of any governmental authority, any failure of the State
to perform and observe any agreement, whether express or implied, or any duty, liability or obligation arising out of or connected with
the Project or this Loan Agreement, or any rights of set-off, recoupment, abatement or counterclaim that the Borrower might otherwise
have against the State, the Trustee or any other party or parties; provided, however, that payments hereunder shall not constitute a waiver
of any such rights. The Borrower shall not be obligated to make any payments required to be made by any other Borrowers under separate
Loan Agreements.

SECTION
3.05.       
Loan Agreement to Survive Loan. The Borrower acknowledges that its duties, covenants, obligations and agreements
set forth in Sections 3.06(a) and (b) hereof shall survive the payment in full of the Loan.

SECTION
3.06.       
Disclaimer of Warranties and Indemnification.

(a)       
The Borrower acknowledges and agrees that: (i) the State does not make any warranty or representation, either express or implied,
as to the value, design, condition, merchantability or fitness for particular purpose or fitness for any use of the Environmental Infrastructure
System or the Project or any portions thereof or any other warranty or representation with respect thereto; (ii) in no event shall the
State or its agents be liable or responsible for any incidental, indirect, special or consequential damages in connection with or arising
out of this Loan Agreement or the Project or the existence, furnishing, functioning or use of the Environmental Infrastructure System
or the Project or any item or products or services provided for in this Loan Agreement; and (iii) to the fullest extent permitted by law,
the Borrower shall indemnify and hold the State harmless against, and the Borrower shall pay any and all, liability, loss, cost, damage,
claim, judgment or expense of any and all kinds or nature and however arising and imposed by law, which the State may sustain, be subject
to or be caused to incur by reason of any claim, suit or action based upon personal injury, death or damage to property, whether real,
personal or mixed, or upon or arising out of contracts entered into by the Borrower, the Borrower’s ownership of the Environmental
Infrastructure System or the Project, or the acquisition, construction or installation of the Project.

(b)       
It is mutually agreed by the Borrower and the State that the State and its commissioners, officers, agents, servants and employees
shall not be liable for, and shall be indemnified and saved harmless by the Borrower in any event from, any action performed under this
Loan Agreement and any claim or suit of whatsoever nature, except in the event of loss or damage resulting from their own negligence or
willful misconduct.

(c)       
In connection with its obligation to provide the insurance required under Section 2.02(j) hereof: (i) the Borrower shall include,
or cause to be included, the State and its employees and officers as additional “named insureds” on (A) any certificate of
liability insurance procured by the Borrower (or other similar document evidencing the liability insurance coverage procured by the Borrower)
and (B) any certificate of liability insurance procured by any contractor or subcontractor for the Project, and from the 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 

    -17- 

     

    

written
certificate of Project completion from the State, the Borrower shall maintain said liability insurance covering the State and said employees
and officers in good standing; and (ii) the Borrower shall include the State as an additional “named insured” on any certificate
of insurance providing against risk of direct physical loss, damage or destruction of the Environmental Infrastructure System, and during
the Loan Term the Borrower shall maintain said insurance covering the State in good standing.

The Borrower shall provide
the State with a copy of each of any such original, supplemental, amendatory or reissued certificates of insurance (or other similar documents
evidencing the insurance coverage) required pursuant to this Section 3.06(c).

SECTION
3.07.       
Option to Prepay Loan Repayments. The Borrower may prepay the Loan Repayments, in whole or in part, upon not
less than ninety (90) days’ prior written notice to the State; provided, however, that, 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 I-Bank Loan, (ii) if the Borrower is contemporaneously making a full or partial prepayment of the I-Bank Loan such that, after
the prepayment of the Loan and the I-Bank Loan, the I-Bank gives its consent required under Section 3.07(iii) of the I-Bank Loan Agreement,
(iii) upon the prior written approval of the State; and (iv) provided that the Borrower shall agree
to pay all costs and expenses of the State in connection with such prepayment. Prepayments shall be applied to the principal payments
on the portion of the Loan to be prepaid in inverse order of their maturity.

SECTION
3.08.       
Priority of Loan and I-Bank Loan.

(a)       
The Borrower hereby acknowledges and agrees that, to the extent permitted by law, any repayments then due and payable on the I-Bank
Loan pursuant to the I-Bank Loan Agreement and paid by the Borrower and any repayments then due and payable on this Loan pursuant to this
Loan Agreement and paid by the Borrower shall be applied by the Trustee, first, to the payment obligations of the Borrower with respect
to the I-Bank Loan and, second, to the payment obligations of the Borrower with respect to this Loan, all in a manner more specifically
identified in subjection (b) hereof. The Borrower agrees not to interfere with any such action by the Trustee with respect to the application
of repayments as set forth herein.

(b)       
The Borrower hereby further acknowledges and agrees that, in the event the Borrower fails or is unable to pay promptly to the Trustee
in full any loan repayments on the I-Bank Loan pursuant to the I-Bank Loan Agreement, then any Loan Repayments paid by the Borrower on
the Loan pursuant to this Loan Agreement and received by the Trustee during the time of any such loan repayment deficiency pursuant to
the I-Bank Loan Agreement shall be applied by the Trustee, first, to satisfy such I-Bank Loan Agreement loan repayment deficiency
as a credit against the obligations of the Borrower to make loan repayments of that portion of interest pursuant to the I-Bank Loan Agreement
that is allocable to the interest payable on the I-Bank Bonds (as defined in the I-Bank Loan Agreement) and to make payments of that portion
of interest pursuant to the bond or note issued by the Borrower to the I-Bank that is allocable to the interest payable on the I-Bank
Bonds, second, to the extent available, to make loan repayments of principal pursuant to the I-Bank Loan Agreement and payments
of principal on the bond or note issued by the Borrower to the I-Bank pursuant to the I-Bank Loan Agreement, third, to the 

    -18- 

     

    

extent
available, to the payment of the administrative fee payable pursuant to the I-Bank Loan Agreement and to make payments of that portion
of interest pursuant to the bond or note issued by the Borrower to the I-Bank that is allocable to the administrative fee payable pursuant
to the I-Bank Loan Agreement, fourth, to the extent available, to the payment of late charges payable pursuant to the I-Bank Loan
Agreement and to make payments of that portion of interest pursuant to the bond issued by the Borrower to the I-Bank that is allocable
to the late charges payable pursuant to the I-Bank Loan Agreement, and finally, to the extent available, to make Loan Repayments
on the Loan.

(c)       
The Borrower hereby further acknowledges and agrees that any Loan Repayments paid by the Borrower on the Loan pursuant to this
Loan Agreement shall be applied according to the provisions of the Master Program Trust Agreement.

SECTION
3.09.       
Approval of the New Jersey State Treasurer. The Borrower and the State hereby acknowledge that prior to or simultaneously
with the Loan Closing the New Jersey State Treasurer, in satisfaction of the requirements of Section 9a of the Act, issued the “Certificate
of the New Jersey State Treasurer Regarding the Approval of the I-Bank 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.

    -19- 

     

    

ARTICLE
IV

ASSIGNMENT OF LOAN AGREEMENT AND BORROWER BOND

SECTION
4.01.       
Assignment and Transfer by State. The Borrower hereby approves and consents to any assignment or transfer of
this Loan Agreement and the Borrower Bond that the State deems to be necessary in connection with the environmental infrastructure loan
program of the State pursuant to the Regulations.

SECTION
4.02.       
Assignment by Borrower. Neither this Loan Agreement nor the Borrower Bond may be assigned by the Borrower for
any reason, unless the following conditions shall be satisfied: (i) the State shall have approved said assignment in writing; (ii) the
assignee shall have expressly assumed in writing the full and faithful observance and performance of the Borrower’s duties, covenants,
obligations and agreements under this Loan Agreement and, to the extent permitted under applicable law, the Borrower Bond; and (iii) immediately
after such assignment, the assignee shall not be in default in the observance or performance of any duties, covenants, obligations or
agreements of the Borrower under this Loan Agreement or the Borrower Bond.

    -20- 

     

    

ARTICLE
V

EVENTS OF DEFAULT AND REMEDIES

SECTION
5.01.       
Events of Default. If any of the following events occur, it is hereby defined as and declared to be and to constitute
an “Event of Default”:

(a)       
failure by the Borrower to pay, or cause to be paid, any Loan Repayment required to be paid hereunder when due;

(b)       
failure by the Borrower to make, or cause to be made, any required payments of principal, redemption premium, if any, and interest
on any bonds, notes or other obligations of the Borrower issued under the Borrower Bond Resolution (other than the Loan and the Borrower
Bond) or otherwise secured by all or a portion of the property pledged under the Borrower Bond Resolution, after giving effect to the
applicable grace period;

(c)       
failure by the Borrower to pay, or cause to be paid, any late charges incurred hereunder or any portion thereof when due or to
observe and perform any duty, covenant, obligation or agreement on its part to be observed or performed under this Loan Agreement, other
than as referred to in subsections (a) and (g) of this Section 5.01, which failure shall continue for a period of thirty (30) days after
written notice, specifying such failure and requesting that it be remedied, is given to the Borrower by the State, unless the State shall
agree in writing to an extension of such time prior to its expiration; provided, however, that if the failure stated in such notice is
correctable but cannot be corrected within the applicable period, the State may not unreasonably withhold its consent to an extension
of such time up to 120 days from the delivery of the written notice referred to above if corrective action is instituted by the Borrower
within the applicable period and diligently pursued until the failure 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, and/or any proceeding with respect to such petition and/or pursuant to
any such law shall occur or be pending (including, without limitation, the operation and administration of the Borrower pursuant to any
plan of reorganization approved and implemented under any such law), unless in the case of any such petition filed against the Borrower
or any such proceeding, such petition and such proceeding shall be dismissed within thirty (30) days after such filing and such dismissal
shall be final and not subject to appeal or the further jurisdiction of any court; 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;

    -21- 

     

    

(g)       
failure of the Borrower to observe or perform such additional duties, covenants, obligations, agreements or conditions as are required
by the State and specified in each of Exhibit F and Exhibit G attached hereto and made a part hereof; and

(h)       
the occurrence of an “Event of Default” pursuant to, and as defined in, (i) the I-Bank Loan Agreement or (ii) any Construction
Financing Program Loan that may be outstanding.

SECTION
5.02.       
Notice of Default. The Borrower shall give the State prompt telephonic notice, confirmed immediately thereafter
with a written notice, of the occurrence of any Event of Default referred to in Section 5.01(e) or (f) hereof and of the occurrence of
any other event or condition that constitutes an Event of Default at such time as any senior administrative or financial officer of the
Borrower becomes aware of the existence thereof.

SECTION
5.03.       
Remedies on Default. Whenever an Event of Default referred to in Section 5.01 hereof shall have occurred and
be continuing, the State shall have the right to take whatever action at law or in equity may appear necessary or desirable to collect
the amounts then due and thereafter to become due hereunder or to enforce the observance and performance of any duty, covenant, obligation
or agreement of the Borrower hereunder.

In addition, if an Event
of Default referred to in Section 5.01(a) hereof shall have occurred and be continuing, the State shall, to the extent allowed by applicable
law, have the right to declare all Loan Repayments and all other amounts due hereunder (including, without limitation, payments under
the Borrower Bond) to be immediately due and payable, and upon notice to the Borrower the same shall become due and payable without further
notice or demand.

SECTION
5.04.       
Attorneys’ Fees and Other Expenses. The Borrower shall on demand pay to the State the reasonable fees and
expenses of attorneys and other reasonable expenses (including, without limitation, the reasonably allocated costs of in-house counsel
and legal staff) incurred by the State in the collection of Loan Repayments or any other sum due hereunder or in the enforcement of the
observation or performance of any other duties, covenants, obligations or agreements of the Borrower upon an Event of Default.

SECTION
5.05.       
Application of Moneys. Any moneys collected by the State pursuant to Section 5.03 hereof shall be applied (a)
first to pay any attorneys’ fees or other fees and expenses owed by the Borrower pursuant to Section 5.04 hereof, (b) second,
to the extent available, to pay principal due and payable on the Loan (to the extent permitted by Section 3.08(b) hereof), (c) third,
to the extent available, to pay any other amounts due and payable hereunder, and (d) fourth, to the extent available, to pay principal
on the Loan and other amounts payable hereunder as such amounts become due and payable.

SECTION
5.06.       
No Remedy Exclusive; Waiver; Notice. No remedy herein conferred upon or reserved to the State is intended to
be exclusive, and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Loan Agreement
or now or hereafter existing at law or in equity. No delay or omission to exercise any right, remedy or power accruing upon any Event
of Default shall impair any such right, remedy or power or shall be construed to be a waiver thereof, but any such right, remedy or power
may be 

    -22- 

     

    

exercised from time to time and as often as may be deemed expedient. In order to entitle the State to exercise any remedy reserved
to it in this Article V, it shall not be necessary to give any notice other than such notice as may be required in this Article V.

SECTION
5.07.       
Retention of State’s Rights. Notwithstanding any assignment or transfer of this Loan Agreement pursuant
to the provisions hereof, or anything else to the contrary contained herein, the State shall have the right upon the occurrence of an
Event of Default to take any action, including (without limitation) bringing an action against the Borrower at law or in equity, as the
State may, in its discretion, deem necessary to enforce the obligations of the Borrower to the State pursuant to Section 5.03 hereof.

    -23- 

     

    

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, (i) to the Borrower at the address specified
in Exhibit A-1 attached hereto and made a part hereof and (ii) to the State and the Trustee at the following respective addresses:

(a)       
State:

New Jersey Department of Environmental
Protection

Municipal Finance and Construction
Element

401 East State Street –
3rd Floor

Trenton, New Jersey 08625-0425

Attention: Assistant Director

New Jersey Department of the Treasury

Office of Public Finance

State Street Square – 5th
Floor

Trenton, New Jersey 08625-0002

Attention: Director

(b)       
Trustee:

Zions Bancorporation, National
Association d/b/a Zions Bank

401 Liberty Avenue, Suite 1729

Pittsburgh, Pennsylvania 15222

Attention: Corporate Trust
Department

Any of the foregoing parties
may designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent by notice
in writing given to the others.

SECTION
6.02.       
Binding Effect. This Loan Agreement shall inure to the benefit of and shall be binding upon the State and the
Borrower and their respective successors and assigns.

SECTION
6.03.       
Severability. In the event any provision of this Loan Agreement shall be held illegal, invalid or unenforceable
by any court of competent jurisdiction, such holding shall not invalidate, render unenforceable or otherwise affect any other provision
hereof.

SECTION
6.04.       
Amendments, Supplements and Modifications. This Loan Agreement may not be amended, supplemented or modified without
the prior written consent of the State and the Borrower.

    -24- 

     

    

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 of New Jersey, including the Regulations, which Regulations are, by this reference thereto, incorporated herein as part
of this Loan Agreement.

SECTION
6.07.       
Consents and Approvals. Whenever the written consent or approval of the State shall be required under the provisions
of this Loan Agreement, such consent or approval may only be given by the State. Further, whenever
the written consent or approval of the State shall be required pursuant to the provisions of this Loan Agreement, such approval or consent
of the State pursuant to the provisions hereof may be either granted or withheld by the State in its sole and absolute discretion.

SECTION
6.08.       
Captions. The captions or headings in this Loan Agreement are for convenience only and shall not in any way define,
limit or describe the scope or intent of any provisions or sections of this Loan Agreement.

SECTION
6.09.       
Further Assurances. The Borrower shall, at the request of the State, authorize, execute, attest, acknowledge
and deliver such further resolutions, conveyances, transfers, assurances, financing statements and other instruments as may be necessary
or desirable for better assuring, conveying, granting, assigning and confirming the rights, security interests and agreements granted
or intended to be granted by this Loan Agreement and the Borrower Bond.

    -25- 

     

    

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

 

	 	 	
    THE STATE OF NEW JERSEY

    ACTING BY AND THROUGH THE

    NEW JERSEY DEPARTMENT OF

    ENVIRONMENTAL PROTECTION

     

     

     

	[SEAL]	 	By:	/s/ Patricia Gardner
	 	 	 	
    Patricia Gardner

    Assistant Commissioner

    Water Resource Management

    Department of Environmental Protection

	
    ATTEST:

     
	 	 	 
	 	 	 	 
	/s/ Paul T. Hauch, P.E.	 	 	 
	
    Paul T. Hauch, P.E.

    Bureau Chief

    Bureau of Construction, Payments

    and Administration

    Municipal Finance and Construction Element

    Department of Environmental Protection
	 	 	 
	 	 	
     

     

     

     

     

    MIDDLESEX WATER COMPANY

	
     

    [SEAL]
	 	 	 
	 	 	 	 
	 	 	By:	/s/ A. Bruce O’Conner
	ATTEST:	 	 	Senior Vice President, Treasurer
	
     

     
	 	 	and Chief Financial Officer
	/s/ Jay L. Kooper	 	 	 
	
    Vice President, General Counsel

    and Secretary

     

     

     
	 	 	 

[signature page]

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