EXHIBIT 10.9
MORTGAGE, SECURITY AGREEMENT AND
ASSIGNMENT OF LEASES AND INCOME
by and between
AES RED OAK, L.L.C.
(as "MORTGAGOR")
-to-
THE BANK OF NEW YORK
(as "MORTGAGEE")
Dated as of: March 1, 2000
This instrument was prepared by, and
after recording, please return to:
▇▇▇▇▇▇▇▇▇ ▇▇▇, Esq.
WINTHROP, STIMSON, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
MORTGAGE, SECURITY AGREEMENT AND
ASSIGNMENT OF LEASES AND INCOME
THIS MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND
INCOME (this "MORTGAGE") made and delivered as of this 1st day of March,
2000, by AES RED OAK, L.L.C., a Delaware limited liability company having an
address at c/o The AES Corporation, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (together with its permitted successors and assigns, the
"MORTGAGOR"), to THE BANK OF NEW YORK ("BNY"), a bank organized and existing
under the laws of the State of New York and having an address ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, not individually, but solely in
its capacity as Collateral Agent for the benefit of and on behalf of the
Senior Parties (as hereinafter defined) under the Collateral Agency Agreement
(as hereinafter defined) (together with its permitted successors and assigns,
the "MORTGAGEE").
W I T N E S S E T H:
WHEREAS, pursuant to the terms of that certain deed from Forest View
Industrial Park, Inc. ("FOREST View") to Mortgagor, dated February 23, 2000
(the "DEED"), Mortgagor is the fee owner of the property located in the
Borough of Sayreville, Middlesex County, New Jersey, more particularly
described in EXHIBIT A attached hereto and made a part hereof (the "SITE"),
which Deed was recorded in the Office of the Clerk of Middlesex County, New
Jersey (the "REGISTER'S OFFICE") on February 24, 2000 in Book 4748, Page 548;
WHEREAS, pursuant to the Deed, Mortgagor is the holder of (i) a
certain access easement to Jernee Mill Road (the "ACCESS EASEMENT"), which
Access Easement was originally granted by Pfizer Inc. to Forest View pursuant
to an Easement dated June 22, 1989 and recorded in the Register's Office on
June 22, 1989 in Deed Book 3789, Page 213, affecting the property described
in EXHIBIT B attached hereto and made a part hereof (the "ACCESS EASEMENT
PREMISES"), and (ii) two (2) sight triangle easements (the "SIGHT TRIANGLE
EASEMENTS"), which Sight Triangle Easements were originally granted by Pfizer
Inc. to Forest View pursuant to an Easement dated June 22, 1989 and recorded
in the Register's Office on June 22, 1989 in Deed Book 3789, Page 227,
affecting the property described in EXHIBIT C attached hereto and made a part
hereof (the "SIGHT TRIANGLE EASEMENTS PREMISES") (the "ACCESS EASEMENT
PREMISES" together with the "SIGHT TRIANGLE EASEMENTS PREMISES,"
collectively, the "EASEMENT PREMISES");
WHEREAS, pursuant to the terms of that certain Ground Lease
Agreement dated as of March 1, 2000 (as amended, modified or otherwise
supplemented from time to time the "SITE LEASE") between Mortgagor, as ground
lessor, and AES Urban Renewal Corporation, as ground lessee (the "SITE
LESSEE" or "AES URC"), Mortgagor has leased the Site together with the Access
Easement and the Sight Triangle Easements to AES URC. A memorandum of Site
Lease was delivered to the Register's Office for recording immediately prior
to the recordation of this Mortgage;
WHEREAS, AES URC, as ground lessee, intends to construct a portion
of the Facilities (as hereinafter defined) on the Site (such portion, the
"URC FACILITY");
WHEREAS, pursuant to that certain Sublease Agreement dated as of
March 1, 2000 (as amended, modified or otherwise supplemented from time to
time, the "SITE SUBLEASE"), between AES URC, as ground sublessor, and
Mortgagor, as ground sublessee, AES URC has subleased the Site and the URC
Facility to Mortgagor. A Memorandum of Sublease was delivered to the
Register's Office for recording immediately prior to the recordation of this
Mortgage;
WHEREAS, Mortgagor has financed a portion of the cost of the
development, construction and equipping of a gas-fired combined cycle
electric generating facility with a net design capacity of approximately 830
megawatts (net) at the Site (the "GENERATING FACILITY") through the issuance,
from time to time, of certain securities (the "SECURITIES") issued pursuant
to the Indenture (as hereinafter defined);
WHEREAS, in connection with the commencement of commercial operation
of the Project, the Mortgagor is required to deliver the Debt Service Reserve
Letter of Credit (the "DSR LETTER OF CREDIT") and Dresdner Bank AG, acting
through its New York Branch ("DRESDNER"), as issuing bank, has agreed to
issue the DSR Letter of Credit subject to the terms and conditions contained
in the Debt Service Reserve Letter of Credit and Reimbursement Agreement,
dated as of March 1, 2000 (as amended, supplemented or modified and in effect
from time to time, the "DSR LOC REIMBURSEMENT AGREEMENT"), among each of the
banks and financial institutions parties thereto and Dresdner, as issuing
bank, a bank and as agent for such banks and financial institutions (in such
capacity as agent, and together with its successors and assigns, the "DSR LOC
PROVIDER");
WHEREAS, in connection with the Mortgagor's obligations under
Section 18.2 of the Power Purchase Agreement (as hereinafter defined), the
Mortgagor intends to deliver the Power Purchase Agreement Letter of Credit
(the "PPA LOC") and Dresdner, as issuing bank, has agreed to issue the PPA
LOC subject to the terms and conditions contained in the Power Purchase
Agreement Letter of Credit and Reimbursement Agreement, dated as of March 1,
2000 (as amended, supplemented or modified and in effect from time to time,
the "PPA LOC REIMBURSEMENT AGREEMENT"), among Mortgagor, each of the banks
and financial institutions parties thereto and Dresdner, as issuing bank, a
bank and as agent for such banks (in its capacity as agent, and together with
its successors and assigns in such capacity, the "PPA LOC PROVIDER");
WHEREAS, the Mortgagor intends to finance certain working capital
requirements of the Project by entering into a Working Capital Agreement,
dated as of March 1, 2000 (as amended, supplemented or modified and in effect
from time to time, the "WORKING CAPITAL AGREEMENT") among the Mortgagor, each
of the banks and financial institutions party thereto and Dresdner, as the
initial bank, a bank and as agent bank (in its capacity as agent, together
with its successors and assigns, the "WORKING CAPITAL PROVIDER"); and
WHEREAS, as security for Mortgagor's obligations under the
Securities, the DSR LOC Reimbursement Agreement and related evidences of
indebtedness, the PPA LOC Reimbursement Agreement and related evidences of
indebtedness, the Collateral Agency
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Agreement, and the Working Capital Agreement and related evidences of
indebtedness (collectively, the "FINANCING DOCUMENTS") and all future
modifications, extensions and renewals of such obligations, including without
limitation the payment of the indebtedness evidenced by the Securities (such
obligations collectively, the "SECURED OBLIGATIONS"), Mortgagor has agreed to
grant to Mortgagee a security interest in the Collateral (as hereinafter
defined).
NOW, THEREFORE, in consideration of the premises set forth above,
and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged and FOR THE PURPOSE OF SECURING the payment and
performance of the Secured Obligations, which Secured Obligations may
increase, decrease and increase again, from time to time, Mortgagor and
Mortgagee hereby agree as follows:
G R A N T I N G C L A U S E S:
In order to secure the Secured Obligations, including without
limitation the payment of an indebtedness evidenced by the Securities, in the
aggregate principal amount of up to Four Hundred Thirty-Eight Million Five
Hundred Dollars ($438,500,000.00) lawful money of the United States, and any
and all sums, amounts and expenses incurred hereunder and under the
Indenture, the Collateral Agency Agreement, the DSR LOC Reimbursement
Agreement, the PPA LOC Reimbursement Agreement and the Working Capital
Agreement according to the terms hereof or thereof and all future
modifications, extensions and renewals of such obligations, and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Mortgagor hereby grants, conveys, mortgages and warrants
unto Mortgagee, its successors and assigns, all of the right, title and
interest of Mortgagor in and to the following property described in Granting
Clauses (a) through (n) inclusive (all of which is hereinafter collectively
referred to as the "COLLATERAL" or the "MORTGAGED PROPERTY") and Mortgagor
covenants that it shall pay and perform the Secured Obligations when due in
accordance with the provisions of the appropriate Financing Documents:
(a) THE SITE: the fee simple interest, title and estate of
Mortgagor in and to the Site;
(b) THE SITE LEASE: all right, title and interest of
Mortgagor as the lessor under the Site Lease, including, without limitation,
all rents, insurance proceeds and condemnation, requisition and other awards
and payments of any kind for or with respect to any of the Mortgaged
Property, as well as all the rights, powers and remedies on the part of
Mortgagor, whether arising under the Site Lease or by statute or at law or
equity or otherwise, arising out of any default thereunder;
(c) THE SITE SUBLEASE: (i) all right, title and interest of
Mortgagor as the sublessee under the Site Sublease, (ii) all right, title and
interest of Mortgagor in any sublease hereafter entered into by Mortgagor as
sub-sublessor, and (iii) all rights of Mortgagor to exercise any election or
option or to make any decision or determination or to give or receive any
notice, consent, waiver or approval or to take any other action under or in
respect of the Site Sublease, as well as all the rights, powers and remedies
on the part of Mortgagor, whether arising under the Site Sublease or by
statute or at law or equity or otherwise, arising out of any default
thereunder;
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(d) THE FACILITIES: (i) the Generating Faciltiy and all
buildings, structures and improvements of every nature whatsoever presently
or hereafter located, erected or placed upon the Site or the Easement
Premises and now or hereafter owned by Mortgagor, and all extensions,
additions, improvements, betterments, renewals, substitutions and
replacements of or to any of the foregoing (collectively, the "IMPROVEMENTS")
and (ii) all machinery, appliances, apparatus, equipment, fittings,
furniture, fixtures, interior improvements, decorations, piping, conduits,
chattels, articles of personal property and other property of every kind and
nature whatsoever owned by Mortgagor, or in which Mortgagor has or shall have
an interest, to the full extent of such interest, now or hereafter attached
to or located on the Site, the Improvements, the Easement Facilities (as
hereinafter defined), the Easement Premises, or any appurtenances thereof,
and used in connection with the present or future operation and occupancy of
the Site, the Improvements, the Easement Facilities (as hereinafter defined),
the Easement Premises, together with any and all extensions, additions,
improvements, betterments, renewals, substitutions and replacements to any of
the foregoing, and all of the right, title and interest of Mortgagor in and
to any such personal property or fixtures which, to the fullest extent
permitted by law, shall be conclusively deemed fixtures and a part of the
real property encumbered hereby (collectively, the "EQUIPMENT"; the
Improvements and said Equipment being hereinafter referred to, collectively,
as the "FACILITIES");
(e) THE EASEMENTS: the Access Easement, the Sight Triangle
Easements and all other easements, rights-of-way, gores of land, streets,
ways, alleys, passages, sewer rights, water courses, water rights and powers,
mineral rights, ditches, ditch rights, reservoirs and reservoir rights, and
all privileges, tenements, hereditaments and appurtenances whatsoever, of any
nature whatsoever, in any way belonging, relating or appertaining to the
Site, the Easement Premises or the Facilities, or which hereafter shall in
any way belong, relate or be appurtenant thereto (said easements, rights and
privileges described in this paragraph (e), including without limitation the
Access Easement and the Sight Triangle Easements, being hereinafter referred
to, collectively, as the "EASEMENTS");
(f) TOGETHER WITH: subject to the provisions of this
Mortgage, all right, title and interest of Mortgagor in and to all awards or
payments, including interest thereon, and the right to receive the same,
which may be made with respect to the Mortgaged Property or any part thereof,
from the exercise of the right of eminent domain, either temporary or
permanent (including any transfer made in lieu of the exercise of said right)
or for any changes to the grades of streets or as a result of any other
damage to the Mortgaged Property or any part thereof;
(g) TOGETHER WITH: subject to the provisions of the
Indenture and this Mortgage, all right, title and interest of Mortgagor in
and to all insurance or other proceeds of, and any unearned premiums on, any
insurance policies required to be maintained by Mortgagor under the
Indenture, including, without limitation, the right, subject to the terms of
the Indenture and this Mortgage, to receive and apply the proceeds of any
insurance, judgments or settlements made in lieu thereof;
(h) TOGETHER WITH: subject to the terms of the Indenture,
all right, title and interest of Mortgagor in and to all "general
intangibles", "accounts" and "proceeds", together with the replacements and
substitutes thereof and profits therefrom (as such terms are defined in the
Uniform Commercial Code (as hereinafter defined)), with respect to which
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Mortgagee shall have, in addition to all rights and remedies provided in
ARTICLE V hereof, all of the rights and remedies of a "secured party" under
the Uniform Commercial Code other than any right, title and interest of
Mortgagor in and to any account created under the Indenture;
(i) TOGETHER WITH: subject in all respects to the
provisions of ARTICLE IV hereof, all right, title and interest of Mortgagor
in, to and under any and all Leases (as hereinafter defined) now or hereafter
entered into, including without limitation, all right, title and interest of
Mortgagor to receive the rents, issues and profits of the Mortgaged Property
thereunder, including without limitation Project Revenues (as hereinafter
defined) (collectively, "INCOME") together with all books and records which
contain payments made under the Leases;
(j) TOGETHER WITH: all of Mortgagor's right, title and
interest in and to all plans and specifications prepared for construction or
operation of the Facilities or other development of the Collateral (including
all amendments, modifications, supplements, general conditions and addenda
thereof or thereto) and all studies, data and drawings (including without
limitation architectural, engineering, mechanical and electrical drawings)
related thereto, and all contracts and agreements of Mortgagor relating to
the aforesaid plans and specifications or to the aforesaid studies, data and
drawings or to the construction or operation of the Facilities;
(k) TOGETHER WITH: to the extent permitted by Legal
Requirements (as hereinafter defined), all of Mortgagor's right, title and
interest in and to all present and future Permits (as hereinafter defined);
PROVIDED, that any of the Permits which by their terms or by operation of Law
would become void, voidable, terminable or revocable or would constitute a
breach or default thereunder if pledged or assigned hereunder or if a
security interest therein were granted hereunder are expressly excepted and
excluded from the lien and term of this Mortgage to the extent necessary to
avoid such voidness, voidability, terminability or revocability;
(l) TOGETHER WITH: all of Mortgagor's right, title and
interest in and to all development, construction management's and maintenance
contracts, including, but not limited to, the Project Contracts (as
hereinafter defined) and warranties, indemnities, undertakings and guarantees
of contractors, subcontractors, materialmen, vendors and suppliers relating
to the Facilities;
(m) TOGETHER WITH: to the extent permitted by Law, all of
Mortgagor's rights and remedies at any time arising under or pursuant to
Section 365(h) of the United States Bankruptcy Code, including, without
limitation, all of Mortgagor's rights to remain in possession of the
Collateral; and
(n) TOGETHER WITH: all and singular the tenements,
hereditaments and appurtenances belonging to the Mortgaged Property or any
part thereof hereby mortgaged or intended so to be or in anywise appertaining
thereto (including, but not limited to, all income, rents and profits arising
therefrom), all streets, alleys, passages, ways, water courses, all other
rights, liberties and privileges of whatsoever kind or character, the
reversions and remainders, and all the estate, right, title, interest,
property, possession, claim and demand whatsoever, as well as at law and
equity, of Mortgagor in and to all of the foregoing or any or every part
thereof.
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TO HAVE AND TO HOLD the Mortgaged Property and all the parts thereof
unto Mortgagee, its successors and assigns, to the Mortgagee's own use and
behalf forever.
ARTICLE I
CERTAIN DEFINITIONS
Section 1.1. Capitalized terms not otherwise defined in this
Mortgage shall have the meaning given to such terms in that certain Trust
Indenture, dated as of March 1, 2000, between Mortgagor and The Bank Of New
York ,as trustee, and The Bank of New York, as depository bank (as amended,
modified or otherwise supplemented and in effect from time to time, the
"INDENTURE"). For purposes of this Mortgage, the following terms shall have
the following meanings, unless the context of this Mortgage requires
otherwise:
(a) "ADJUSTED BASE RATE" means the interest rate which is
the higher of (x) the Federal Funds Rate plus .5% and (y) the Reference Rate.
(b) "ADDITIONAL COLLATERAL" has the meaning provided in
SECTION 5.1.
(c) "AFFECTED PROPERTY" has the meaning provided in SECTION
2.5.
(d) "ANNUAL BUDGET" has the meaning provided in the
Indenture.
(e) "BUSINESS DAY" means any day other than a Saturday,
Sunday or other day on which banks in New York, New York are authorized or
required by law or executive order to remain closed or a day on which the
Corporate Trust Office of the Trustee is closed for business.
(f) "COLLATERAL" has the meaning provided in the Granting
Clauses.
(g) "COLLATERAL AGENCY AGREEMENT" means the Collateral
Agency and Intercreditor Agreement, dated as of March 1, 2000, among
Mortgagor, BNY and Dresdner Bank AG, acting through its New York Branch.
(h) "EASEMENT FACILITIES" means all pipes, valves,
conduits, pumps, lines, processors, transformers, works, facilities,
equipment, devices, buildings and improvements of every kind and nature
located on or within any Easement Premises or that certain piece or parcel of
land described in EXHIBIT D annexed hereto under, over or across which
Mortgagor has been granted a license pursuant to that certain License
Agreement for Utility Lines Occupation dated February 23, 2000 between
Consolidated Rail Corporation and Mortgagor.
(i) "EASEMENTS" has the meaning provided in the Granting
Clauses.
(j) "ENVIRONMENTAL LIABILITIES AND COSTS" means all
liabilities, obligations, losses, damages (whether actual, consequential or
punitive), costs and expenses (including, without limitation, all reasonable
fees, disbursements and expenses of counsel, experts and consultants), fines,
penalties and sanctions, whether based on or in contract, tort, implied or
express warranty, strict liability or criminal or civil statute (including,
without limitation, any of the foregoing arising under any Environmental Law,
Permit, or order or agreement with any
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Governmental Authority or other Person), and which relate to any
environmental, health or safety condition, or a Release or threatened Release.
(k) "ENVIRONMENTAL LIEN" means any lien in favor of any
Governmental Authority for Environmental Liabilities and Costs.
(l) "EQUIPMENT" has the meaning provided in the Granting
Clauses.
(m) "EVENT OF DEFAULT" means any of the events or
circumstances described as such in ARTICLE VI hereof.
(n) "FACILITIES" has the meaning provided in the Granting
Clauses.
(o) "FEDERAL FUNDS RATE" means, for any period, a
fluctuating interest rate PER ANNUM equal for each day during such period to
the weighted average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by federal funds brokers,
as published for such day (or, if such day is not a Business Day, for the
next preceding Business Day) by the Federal Reserve Bank of New York or, if
such rate is not so published for any day that is a Business Day, the average
of the quotations for such day on such transactions received by Mortgagee
from federal funds brokers of recognized standing selected by it.
(p) "IMPOSITIONS" means all duties, taxes, assessments,
dues, charges, fees, excises, levies, license and permit fees, impositions,
water rates, sewer rents and other charges, ordinary or extraordinary,
whether foreseen or unforeseen, of any kind whatsoever, (i) now or hereafter
levied or assessed or imposed against or upon or in respect of the Mortgaged
Property, or (ii) which now is or may be levied or assessed against the
Income by virtue of any present or future Legal Requirement, as well as all
income taxes, assessments and other governmental charges levied and imposed
by any Governmental Authority upon or against Mortgagor or in respect of the
Mortgaged Property or any part thereof, to the extent the same is in lieu of
or in substitution of the items described in clause (i). Taxes shall not
include any taxes imposed on the net income, gross receipts or any franchise
taxes of Mortgagee, except as provided in the Indenture.
(q) "IMPROVEMENTS" has the meaning provided in the Granting
Clauses.
(r) "INCOME" has the meaning provided in the Granting
Clauses.
(s) "INDEMNITEE" has the meaning provided in SECTION 2.5.
(t) "INDENTURE" has the meaning provided in the first
paragraph of this SECTION 1.1.
(u) "LEASES" means any lease, sublease, rental agreement,
occupancy agreement, license, franchise or concession agreement or any other
form of occupancy or use agreement, however denominated, written or oral,
affecting the Mortgaged Property, or any part thereof, including, without
limitation, the Project Contracts now or hereafter entered into and all
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modifications, amendments, renewals, extensions, replacements, guarantees and
other agreements affecting the same.
(v) "LEGAL REQUIREMENT(S)" means all present and future
laws, ordinances, orders, judgments, rules, regulations and requirements of
any Governmental Authority or arbitrator applicable to the Mortgagor or the
Mortgaged Property, including, without limitation, Environmental Laws, the
Employee Retirement Income Security Act of 1974 (as amended from time to
time), zoning and subdivision laws and ordinances and building codes,
restrictive covenants, and development orders, which at any time are or may
be applicable to the Mortgaged Property or any part thereof, including,
without limitation, the Americans With Disabilities Act (42 U.S.C. ss.12101
eT Seq.), as amended, and the regulations promulgated thereunder.
(w) "MORTGAGE" means this document, as the same may be
amended, modified, supplemented, assigned by Mortgagee, extended, renewed,
restated and in effect from time to time.
(x) "MORTGAGED PROPERTY" has the meaning provided in the
Granting Clauses.
(y) "MORTGAGEE" means the Mortgagee herein named or, at any
given time, the holder or holders of this Mortgage, and its or their
respective heirs, executors, administrators, successors and assigns.
(z) "MORTGAGOR" means the Mortgagor herein named, any
subsequent owner or owners of the Mortgaged Property, and its or their
respective heirs, executors, administrators, successors and permitted assigns.
(aa) "PERMIT" means any permit, approval, authorization,
license, consent, variance or permission required from or by a Governmental
Authority for the use, operation, maintenance and restoration of the
Mortgaged Property or any part thereof in accordance with all Legal
Requirements, including, without limitation, a certificate of occupancy.
(aa) "PROJECT CONTRACTS" has the meaning provided in the
Indenture.
(ab) "PROJECT REVENUES" has the meaning provided in the
Indenture.
(ac) "REFERENCE RATE" means the variable rate of interest
PER ANNUM officially announced or published by Mortgagee from time to time as
its "reference rate," such rate being set by Mortgagee as a general reference
rate of interest, taking into account such factors as Mortgagee may deem
appropriate, it being understood that many of Mortgagee's commercial or other
loans are priced in relation to such rate, that it is not necessarily the
lowest or best rate actually charged to any customer and that Mortgagor may
make various commercial or other loans at rates of interest having no
relationship to such rate. Each change in the Reference Rate shall be
effective as of the opening of business on the date announced as the
effective date of the change in such "reference rate."
(ad) "RELEASE" means any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment or into or out of any
property, including, without limitation, the movement of
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Hazardous Materials through or in the air, soil, surface water, ground water
or property or as may be otherwise defined under Environmental Laws.
(ae) "REMEDIAL ACTION" means any and all actions required
by any Environmental Law or voluntarily undertaken to (i) clean up, remove,
treat or in any other way address Hazardous Materials in the indoor or
outdoor environment, (ii) prevent the Release or threatened Release or
minimize the further Release of Hazardous Materials so that they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment or (iii) perform pre-remedial studies and
investigations and post-remedial monitoring and care.
(af) "REQUIRED SENIOR PARTIES" has the meaning provided in
the Collateral Agency Agreement.
(ag) "SECURED OBLIGATIONS" has the meaning provided in the
Granting Clauses.
(ah) "SENIOR PARTIES" has the meaning provided in the
Collateral Agency Agreement.
(ai) "SENIOR PARTY CERTIFICATES" has the meaning provided
in the Collateral Agency Agreement.
(aj) "SITE" has the meaning provided in the Granting
Clauses.
(ak) "STATE" means the State of New Jersey.
(al) "TENANT(S)" means all of the parties to, and Persons
obligated to Mortgagor under, any Lease.
(am) "TRIGGER EVENT" has the meaning provided in the
Collateral Agency Agreement.
(an) "TRANSACTION DOCUMENTS" has the meaning provided in
the Indenture.
(ao) "UNIFORM COMMERCIAL CODE" means the Uniform Commercial
Code as in effect from time to time in the State.
ARTICLE II
REPRESENTATIONS, WARRANTIES and covenants
OF MORTGAGOR
Mortgagor represents and warrants to Mortgagee as follows:
Section 2.1. PAYMENT AND PERFORMANCE OF SECURED OBLIGATIONS. The
maximum principal indebtedness secured by this Mortgage is $438,500,000.00,
provided, however, that
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such limitation shall not limit the security of this Mortgage with respect to
future advances. All future advances under the Securities, this Mortgage, the
Indenture and the other Financing Documents shall have the same priority as
if the future advance was made on the date that this Mortgage was recorded.
Mortgagor hereby acknowledges and agrees that the Secured Obligations
include, and that this Mortgage is given to secure, advances that may be made
by Mortgagee, Working Capital Provider, PPA LOC Provider and DSR LOC Provider
to Mortgagor and obligations to Mortgagee that may be incurred by Mortgagor
after the execution of this Mortgage ("FUTURE ADVANCES") and that this
Mortgage shall secure all Future Advances of every kind and whenever
occurring, including, without limitation, interest on the principal
indebtedness, the payment of taxes, assessments, maintenance charges,
insurance premiums, costs incurred for the protection of the Mortgaged
Property and the lien of this Mortgage, expenses incurred by the Mortgagee by
reason of default by the Mortgagor, and advances made to enable completion of
the improvements.
Section 2.2. WARRANTY OF TITLE, ETC. Mortgagor represents and
warrants that:
(a) (i) it is the sole and lawful owner of, and has good,
marketable and indefeasible fee simple title to, the Site and Facilities on
the Site, (ii) it is lawfully possessed of the Easements, (iii) Mortgagor has
good and valid rights of access to the Site for the operation of the
Facilities, (iv) the Mortgagor has good and valid rights to use the Easement
Facilities in accordance with the terms thereof, (v) its title to the Site,
and its interest in the Facilities and Easements are free and clear of all
liens, charges and encumbrances of every kind and character, other than the
Permitted Liens, (vi) it is not required to obtain the consent of any
third-party which has not been obtained prior to encumbering and conveying
the Mortgaged Property as provided herein, (vii) this Mortgage is and will
remain a valid and enforceable first lien on the Mortgaged Property, subject
only to the Permitted Liens, (viii) it has not previously assigned the Income
or any of its other rights in and to the Mortgaged Property, (ix) there are
no offsets or defenses to this Mortgage or to the Secured Obligations, and
(x) that there are no unpaid claims of mechanics, materialmen or contractors
that may result in the entry of a lien on the Mortgaged Property;
(b) the Facilities are or will be situated on the Site and
certain of the Easement Premises and the use thereof is in full compliance in
all material respects with all Legal Requirements; and
(c) the Mortgagor has all easements and rights necessary
for Mortgagor's construction and operation of the Facilities in a manner
which is consistent with (i) the Indenture and the Transaction Documents and
(ii) the Annual Budget.
Section 2.3. MORTGAGED PROPERTY IS FREE FROM DAMAGE. Mortgagor
represents and warrants that the Mortgaged Property is free from material
damage caused by fire, explosion, accident or any other casualty (whether or
not covered by insurance) and there are no condemnation or similar
proceedings pending or, to the best of Mortgagor's knowledge, threatened
which affect the Mortgaged Property.
Section 2.4. UTILITIES. Mortgagor represents and warrants that the
Facilities are served by, or will be served by, and have, or will have, the
benefit of all utilities, services,
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facilities, easements and rights required for its operation of the Facilities
in accordance with the Indenture and the Transaction Documents.
Section 2.5. ENVIRONMENTAL INDEMNIFICATION. (a) Mortgagor agrees to
defend, indemnify and hold harmless Mortgagee and its respective co-trustees
and affiliates, and the directors, officers, employees, consultants and
advisers and agents of any of the foregoing (each of the foregoing being an
"INDEMNITEE") from and against any and all claims, damages, liabilities,
obligations, losses, penalties, actions, judgments, suits, costs,
disbursements and expenses of any kind or nature (including, without
limitation, reasonable fees and disbursements of one firm of counsel to all
such Indemnitees) which may be imposed on, incurred by or asserted against
any such Indemnitee in connection with or arising out of any matter affecting
or relating to the Affected Property (as defined below) pursuant to any
Environmental Law, or any Release or use, storage, treatment, transportation
, disposal or handling of any Hazardous Materials on, from, under or
affecting all or any part of the Affected Property, including, without
limitation, (i) all Environmental Liabilities and Costs arising from or
connected with the Affected Property, (ii) damages (whether actual,
consequential or punitive) arising from any personal injury (including
wrongful death) or property damage (real or personal) alleged to have
resulted from any Release of Hazardous Materials on, upon or into all or any
part of the Affected Property, (iii) any costs and liabilities incurred in
connection with the investigation, removal, cleanup and/or remediation of any
Hazardous Material present upon all or any part of the Affected Property,
(iv) to the extent required by law, additional costs to treat or to take
necessary precautions to protect against the release or migration of
Hazardous Materials on, from, under or affecting the Mortgaged Property into
the air, any body of surface or subsurface water or any surrounding areas,
and (v) any costs or liabilities incurred in connection with any
Environmental Lien (except, with respect to any of the foregoing, to the
extent the same results from the gross negligence or willful misconduct of
any Indemnitee) (the Mortgaged Property and any surrounding areas to the
extent affected by a Release from the Mortgaged Property are hereinafter
collectively referred to as the "AFFECTED PROPERTY"). The indemnity contained
in this SECTION 2.5 shall not be limited, impaired or terminated by (1) any
extensions of time for performance under any of the Financing Documents, (2)
any sale or assignment of this Mortgage, (3) any sale or transfer of all or
any part of the Mortgaged Property, (4) any foreclosure of this Mortgage or
deed to the Mortgaged Property in lieu of foreclosure, or exercise of any
other remedies under this Mortgage, (5) the satisfaction, release or
termination of this Mortgage, (6) the release or substitution in whole or in
part of any other security for the Secured Obligations or (7) Mortgagee's
participating in the management of, or taking possession of, or title to, the
Mortgaged Property or any part thereof whether by foreclosure or otherwise.
(b) Mortgagee agrees that, in the event any investigation,
litigation or proceeding alleging matters of the nature set forth in
paragraph (a) above is asserted or threatened in writing or instituted
against it or any other Indemnitee, or any remedial, removal or response
action is requested of it or any of its officers, directors, agents and
employees, for which any Indemnitee is entitled to an indemnity or defense
hereunder, such Indemnitee shall promptly notify Mortgagor in writing after
obtaining any notice of the foregoing, provided that a failure to so notify
Mortgagor in writing after obtaining any notice of the foregoing shall not
relieve Mortgagor of any liability hereunder unless such failure prejudices
Mortgagor's ability to defend against such action or proceeding or take other
necessary or appropriate action to remediate or mitigate the liability
involved. Notwithstanding anything to the contrary in this
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SECTION 2.5, if Mortgagor has actual knowledge of any of the foregoing,
independent of Indemnitee's notice, Mortgagor shall in no event be relieved
of any obligation under this SECTION 2.5. In the event that any Indemnitee
requests Mortgagor to defend against such investigation, litigation or
proceeding or requested remedial, removal or response action, Mortgagor shall
promptly do so, and such Indemnitee shall have the right to have legal
counsel of its choice participate in such defense. No action taken by legal
counsel chosen by such Indemnitee in defending against any such
investigation, litigation or proceeding or requested remedial, removal or
response action shall vitiate or in any way impair Mortgagor's obligation
hereunder to otherwise indemnify and hold harmless such Indemnitee.
(c) Mortgagee shall give Mortgagor reasonable prior notice
of any settlement, compromise or similar disposition by Mortgagee of any
investigation, litigation or proceeding as to which Mortgagor has an
obligation to defend and Mortgagee will not settle, compromise or effect a
similar disposition of any matter unless such settlement, compromise or
disposition (i) includes an unconditional release of the Mortgagor from all
liability relating thereto and (ii) does not include a statement as to, or an
admission of fault, culpability or failure to act, by or on behalf of
Mortgagor.
(d) The obligations of Mortgagor under this SECTION 2.5
shall survive the repayment and performance of the Secured Obligations and
the release of the lien created by this Mortgage.
Section 2.6. TRANSFER OR ENCUMBRANCE OF THE MORTGAGED PROPERTY.
Except to the extent permitted under Section 6.12 of the Indenture, no part
of the Mortgaged Property shall be terminated, sold, transferred, leased,
assigned, licensed, disposed of or conveyed or, except for Permitted Liens
and the URC Documents, further encumbered, mortgaged or hypothecated, whether
voluntarily or involuntarily, directly or indirectly, or by operation of law
or otherwise, without the prior written consent of Mortgagee in each
instance. To the extent any new real property is acquired by Mortgagor,
Mortgagor shall (i) execute and deliver a mortgage in the form and substance
of this Mortgage and all other documents necessary to create a first lien on
the new property in favor of Mortgagee, (ii) deliver to Mortgagee title
insurance insuring the lien of the new mortgage free and clear of all Liens
other than Permitted Liens, (iii) deliver to Mortgagee a survey of the new
property prepared by a registered land surveyor and complying with the
minimum detail requirements adopted by the American Land Title Association of
American Congress on Surveying and Mapping, and (iv) deliver to Mortgagee an
opinion of Mortgagor's counsel, in customary form and substance and
reasonably acceptable to Mortgagee. All costs and expenses incurred by
Mortgagor and Mortgagee by virtue of the foregoing, including, but not
limited to, title insurance premiums, recording fees, mortgage and other
taxes, survey costs and Mortgagee's attorneys' fees and disbursements, shall
be paid by Mortgagor on demand; provided, however, Mortgagee hereby approves
Mortgagor's future purchase of the URC Facility from AES URC pursuant to its
purchase option at the end of the term of the Site Lease, and this Mortgage
shall grant a security interest in the URC Facility upon such acquisition by
Mortgagor without the need for Mortgagor to provide the materials listed in
items (i) through (iv) of this sentence.
Section 2.7. AFTER-ACQUIRED PROPERTY. All right, title and interest
of Mortgagor in and to all improvements, betterments, renewals, substitutes
and replacements of, and all additions,
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accessions and appurtenances to, the Mortgaged Property hereafter acquired,
constructed, assembled or placed by the Mortgagor on the Site, the
Facilities, the Easement Premises, the Easement Facilities and all
conversions of the security constituted thereby, immediately upon such
acquisition, construction, assembly, placement or conversion, as the case may
be, and in each such case without any further mortgage, conveyance or
assignment or other act of Mortgagor, including Mortgagor's future
acquisition of the URC Facility, shall become subject to the lien of this
Mortgage as fully and completely, and with the same effect, as though now
owned by Mortgagor and incorporated in the Granting Clauses hereof.
Section 2.8. FURTHER ASSURANCES. Mortgagor shall, at Mortgagor's
sole cost and expense, and at the request of Mortgagee, do, execute,
acknowledge and deliver all further acts, mortgages, assignments, notices of
assignment, transfers and assurances as Mortgagee shall from time to time
reasonably require (i) for filing, registering or recording this Mortgage and
all UCC financing and continuation statements delivered in connection with
the Secured Obligations; (ii) for better assuring, assigning, transferring
and confirming unto Mortgagee the Mortgaged Property or such property which
Mortgagor may be or may hereafter become bound to convey, mortgage or assign
to Mortgagee, including, without limitation, amendments and supplements to
this Mortgage and UCC financing and continuation statements, the filing or
recordation of which are, in the reasonable determination of Mortgagee,
necessary or appropriate to create, perfect or maintain the existence or
perfected status of any security interest granted pursuant to this Mortgage
or any other Financing Document; and (iii) for carrying out the intention or
facilitating the performance of the terms of this Mortgage or any other
Financing Document. Mortgagee is hereby authorized to file such UCC Financing
Statements and Continuation Statements as it may deem necessary or
appropriate to evidence, maintain, perfect and continue the security interest
granted by this Mortgage without notice to or the signature or consent of the
Mortgagor.
Section 2.9. LITIGATION. Mortgagor shall promptly furnish to
Mortgagee written notice of, and copies of any documents or papers requested
by Mortgagee relating to, any actions, suits or proceedings pending, or to
the knowledge of Mortgagor threatened, against and, which could, if
determined adversely to Mortgagor have a Material Adverse Effect on Mortgagor
or all or any portion of the Mortgaged Property.
Section 2.10. REPRESENTATIONS. All representations and warranties
contained in this ARTICLE II are made as of the date of this Mortgage.
ARTICLE III
CONDEMNATION
Section 3.1. Mortgagor, immediately upon obtaining knowledge of the
institution of any proceedings for the condemnation of the Mortgaged Property
or any portion thereof, shall notify Mortgagee of the pendency of such
proceedings. Mortgagee, at its election and in its discretion, may
participate in any such proceedings and Mortgagor from time to time shall
deliver to Mortgagee all instruments requested by it to permit such
participation. All awards from a condemnation (or other taking or purchase in
lieu thereof) of the Mortgaged Property or any portion thereof shall be
deposited and applied in accordance with the Collateral Agency Agreement.
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ARTICLE IV
LEASES AND INCOME;
ASSIGNMENT AS FURTHER SECURITY
Section 4.1. ASSIGNMENT, RIGHTS OF MORTGAGEE. All of the provisions
of that certain Assignment of Leases and Income dated the date hereof from
Mortgagor to Mortgagee, which Assignment of Leases and Income will be
recorded in Register's Office immediately after recording this Mortgage,
shall be incorporated herein by reference as if set forth fully herein.
ARTICLE V
SECURITY AGREEMENT
Section 5.1. THIS MORTGAGE A SECURITY AGREEMENT; FILINGS. This
Mortgage constitutes both a real property mortgage and a "security agreement"
within the meaning of the Uniform Commercial Code. Mortgagor (as Debtor)
hereby grants to Mortgagee (as Creditor and Secured Party) a security
interest in all of Mortgagor's right, title and interest in and to (i) so
much of the Equipment or any other part of the Mortgaged Property as are
considered or as shall be determined to be personal property or "fixtures"
(as defined in the Uniform Commercial Code) and not real estate, together
with all replacements thereof, substitutions therefor or additions thereto,
and (ii) all general intangibles and accounts in any way relating to the
Mortgaged Property (said Equipment, personal property, fixtures, general
intangibles and accounts being sometimes hereinafter referred to as the
"ADDITIONAL COLLATERAL"), subject only to Permitted Liens, Mortgagor and
Mortgagee acknowledge and agree that all references in this Mortgage to
Collateral shall include, but shall not be limited to, the Additional
Collateral. Mortgagor shall execute any and all such documents, including
without limitation financing statements pursuant to the Uniform Commercial
Code ("FINANCING STATEMENTS"), as Mortgagee may reasonably request, to
preserve and maintain the priority of the lien created hereby on property
which may constitute or be deemed to be Additional Collateral, and shall pay
to Mortgagee on demand any reasonable expenses incurred by Mortgagee in
connection with the preparation, execution and filing of any such documents.
Mortgagor shall, at its sole cost and expense, execute and file all Financing
Statements and refilings and continuations of filings previously executed by
Mortgagor as Mortgagee reasonably deems necessary or advisable to create,
preserve and protect said lien; and Mortgagor hereby authorizes and empowers
Mortgagee to execute any such Financing Statements or filings, on Mortgagee's
behalf, if Mortgagor should fail to do so.
Section 5.2. RIGHT TO PROCEED AGAINST ADDITIONAL COLLATERAL UPON THE
OCCURRENCE OF AND DURING CONTINUATION AN EVENT OF DEFAULT. If a Trigger Event
shall have occurred and be continuing and Mortgagee shall have received the
Senior Party Certificates from the Required Senior Parties pursuant to
Section 2.3(a) of the Collateral Agency Agreement, in addition to any other
rights and remedies which it may have, Mortgagee shall have and may exercise
immediately and without demand, any and all rights and remedies granted to a
secured party upon default under the Uniform Commercial Code, including,
without limiting the generality of the foregoing, the right to take
possession of the Additional Collateral or any part thereof and sell the same
at one or more public or private sales, and to take such other measures as
Mortgagee
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may deem necessary for the care, protection and preservation of the
Additional Collateral. The parties agree that, in the event Mortgagee shall
elect to proceed with respect to the Additional Collateral separately from
the other Mortgaged Property unless a greater period shall then be mandated
by the Uniform Commercial Code, ten (10) days' notice of the sale of the
Additional Collateral shall be reasonable notice. Mortgagee's reasonable
expenses of retaking, holding, preparing for sale, selling and the like,
including, but not limited to, reasonable attorneys' fees and other legal
expenses, shall be assessed against Mortgagor, added to the Secured
Obligations and secured by the lien of this Mortgage. Mortgagor agrees that
it will not remove or permit to be removed from the Mortgaged Property any of
the Additional Collateral without the prior written consent of Mortgagee
except as hereinabove provided or as permitted by the Indenture. The proceeds
of any disposition of the Additional Collateral, or any part thereof, shall
be applied by Mortgagee in accordance with the terms of the Indenture.
Section 5.3. REPLACEMENTS, ETC. All replacements, renewals,
accessions, attachments and additions to the Additional Collateral shall be
and become immediately subject to the security interest of this Mortgage and
the provisions of this ARTICLE V. Mortgagor warrants and represents that the
Additional Collateral now is, and covenants to ensure that all replacements
thereof, substitutions therefor or additions thereto will be, free and clear
of liens, encumbrances or security interests of others except Permitted Liens.
ARTICLE VI
DEFAULTS
Section 6.1. The term "EVENT OF DEFAULT", as used in this Mortgage,
shall mean the occurrence of and continuation of a Trigger Event.
ARTICLE VII
REMEDIES
Section 7.1. MORTGAGEE'S POWER OF ENFORCEMENT. If a Trigger Event
shall have occurred and be continuing and Mortgagee shall have received the
Senior Party Certificates from the Required Senior Parties pursuant to
Section 2.3(a) of the Collateral Agency Agreement, Mortgagee may and in
accordance with the procedures prescribed, and to the extent permitted, by
applicable law, either with or without entry or taking possession as
hereinabove provided or otherwise, and without regard to whether or not the
Secured Obligations shall be due and without prejudice to any other right of
Mortgagee, proceed by any appropriate action or proceeding: (i) to institute
proceedings for the complete or partial foreclosure of this Mortgage and to
sell, at one or more sales as an entirety or in separate lots or parcels, the
Mortgaged Property, as hereinafter provided or pursuant to law, (ii) to sell
for cash or upon credit the Mortgaged Property or any part thereof and all
estate, claim, demand, right, title and interest of Mortgagor therein and
rights of redemption thereof, at one (1) or more sales, in its entirety or in
portions, at such time and place, upon such terms and after such notice
thereof as may be required or permitted by law or in the absence of any such
requirements, as Mortgagee (acting in accordance with an opinion of counsel
upon which Mortgagee may conclusively rely) may deem appropriate, and in the
15
foreclosure sale, of less than all of the Mortgaged Property, this Mortgage
shall continue as a lien on the remaining portion of the Mortgaged Property,
(iii) to split this Mortgage into two (2) or more mortgages and to institute
proceedings for the complete or partial foreclosure of any one or more of
such mortgages, with such unforeclosed mortgages remaining a lien on the
Mortgaged Property and to sell, at one or more sales as an entirety or in
separate lots or parcels, the Mortgaged Property, as hereinafter provided or
pursuant to law, subject to such mortgages which were not foreclosed, (iv) to
cumulatively pursue any other remedy now or hereafter available to it in
equity, at law, by virtue of statute or otherwise, (v) to exercise in respect
of any part or parts of the Additional Collateral, all of the rights and
remedies available to a secured party upon default under the applicable
provisions of the Uniform Commercial Code in effect in the State, and (vi) to
enforce any and all remedies of the Mortgagor under the Project Contracts.
Section 7.2. ENTRY; RECEIVERSHIP. If a Trigger Event shall have
occurred and be continuing and mortgagee shall have received the senior party
certificates from the required senior parties pursuant to section 2.3(a) of
the Collateral Agency Agreement, Mortgagee may and in accordance with the
procedures prescribed, and to the extent permitted, by applicable law, either
with or without entry or taking possession as hereinabove provided or
otherwise, and without regard to whether or not the Secured Obligations shall
be due and without prejudice to any other right of Mortgagee, proceed by any
appropriate action or proceeding to enter into possession of the Mortgaged
Property, with or without legal action, and by force, if necessary, lease the
same and collect all rents and profits therefrom and, after deducting all
costs of collection and administration expense, apply the net rents and
profits to the payment of taxes, water and sewer rents, charges and claims,
insurance premiums, assessments and all other carrying charges (including,
without limitation, agents' compensation and reasonable fees and costs of
counsel and receivers) and to the maintenance, repair or restoration of the
Mortgaged Property, or on account and in reduction of the principal or
interest, or principal and interest, hereby secured, in such order and
amounts as Mortgagee, in Mortgagee's sole discretion, may elect and have a
receiver appointed to enter into possession of the Mortgaged Property,
collect the rents and profits therefrom, and apply the same as provided for
herein. Mortgagee shall be liable to account only for rents and profits
actually received. FOR SUCH PURPOSES, IF A TRIGGER EVENT SHALL HAVE OCCURRED
AND BE CONTINUING AND MORTGAGEE SHALL HAVE RECEIVED THE SENIOR PARTY
CERTIFICATES FROM THE REQUIRED SENIOR PARTIES PURSUANT TO SECTION 2.3(A) OF
THE COLLATERAL AGENCY AGREEMENT, MORTGAGOR HEREBY AUTHORIZES ANY ATTORNEY OF
ANY COURT OF RECORD TO APPEAR FOR MORTGAGOR TO SIGN AN AGREEMENT FOR ENTERING
AN AMICABLE ACTION OF EJECTMENT FOR POSSESSION OF THE MORTGAGED PROPERTY AND
TO CONFESS JUDGMENT THEREIN AGAINST MORTGAGOR IN FAVOR OF MORTGAGEE FOR SUCH
POSSESSION AS WELL AS ALL MONETARY AMOUNTS SECURED HEREUNDER, WHEREUPON A
WRIT MAY FORTHWITH ISSUE FOR THE IMMEDIATE POSSESSION OF THE PROPERTY,
WITHOUT ANY PRIOR WRIT OR PROCEEDING WHATSOEVER; AND FOR SO DOING, THIS
MORTGAGE OR A COPY HEREOF VERIFIED BY AFFIDAVIT SHALL BE A SUFFICIENT
WARRANT. THE AUTHORITY GRANTED HEREIN TO CONFESS JUDGMENT SHALL NOT BE
EXHAUSTED BY ANY EXERCISE THEREOF, BUT SHALL CONTINUE FROM TIME TO TIME AND
AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL OF THE AMOUNTS DUE HEREUNDER AND
THE PERFORMANCE
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OF ALL OTHER COVENANTS HEREIN AND IN THE REMAINING LOAN DOCUMENTS.
Notwithstanding the foregoing, if a Trigger Event shall have occurred and be
continuing and Mortgagee shall have received the Senior Party Certificates
from the Required Senior Parties pursuant to Section 2.3(a) of the Collateral
Agency Agreement, and in the event of threatened waste to any part of the
Mortgaged Property (but not actual waste), Mortgagee shall provide notice to
Mortgagor of its intention to appoint a receiver and shall permit Mortgagor a
reasonable period of time to eliminate the threatened waste prior to the
appointment of a receiver.
Section 7.3. ENTRY OF JUDGMENT. IF A TRIGGER EVENT SHALL HAVE
OCCURRED AND BE CONTINUING AND MORTGAGEE SHALL HAVE RECEIVED THE SENIOR PARTY
CERTIFICATES FROM THE REQUIRED SENIOR PARTIES PURSUANT TO SECTION 2.3(A) OF
THE COLLATERAL AGENCY AGREEMENT, MORTGAGOR HEREBY IRREVOCABLY AUTHORIZES AND
EMPOWERS ANY THE CLERK OF ANY COURT IN THE STATE OF NEW JERSEY, OR ELSEWHERE,
TO APPEAR AT ANY TIME FOR MORTGAGOR IN ANY ACTION BROUGHT AGAINST MORTGAGOR
ON THIS MORTGAGE AT THE SUIT OF MORTGAGEE, WITH OR WITHOUT DECLARATION FILED,
AS OF ANY TERM, AND THEREIN TO CONFESS OR ENTER JUDGMENT AGAINST MORTGAGOR
FOR THE ENTIRE UNPAID PRINCIPAL OF THE LOAN AND ALL OTHER SUMS DUE HEREUNDER
OR UNDER ANY OF THE LOAN DOCUMENTS, AND ALL ARREARAGES OF INTEREST THEREON,
TOGETHER WITH COSTS OF SUIT, AND FOR SO DOING, THIS MORTGAGE OR A COPY
THEREOF VERIFIED BY AFFIDAVIT SHALL BE A SUFFICIENT WARRANT. To the extent
permitted, and in accordance with the procedures prescribed, by applicable
law, Mortgagee shall take action either by such proceedings or by the
exercise of its powers with respect to entry or taking possession, or both,
as Mortgagee may determine.
Section 7.4. MORTGAGEE'S RIGHT TO ENTER, TO OPERATE MORTGAGED
PROPERTY AND APPLY INCOME.
(a) If a Trigger Event shall have occurred and be
continuing and Mortgagee shall have received the Senior Party Certificates
from the Required Senior Parties pursuant to Section 2.3(a) of the Collateral
Agency Agreement, Mortgagor upon demand of Mortgagee, shall forthwith
surrender to Mortgagee the actual possession of the Mortgaged Property, and
if and to the extent permitted by law, Mortgagee itself, or by such officers
or agents as it may appoint, or by a court-appointed receiver, may, without
assuming liability for the performance of any obligations of Mortgagor, enter
and take possession of all the Mortgaged Property and may exclude Mortgagor
and its agents and employees wholly therefrom and have unencumbered access to
the books, papers and accounts of Mortgagor.
(b) If a Trigger Event shall have occurred and be
continuing and Mortgagee shall have received the Senior Party Certificates
from the Required Senior Parties pursuant to Section 2.3(a) of the Collateral
Agency Agreement, and if Mortgagor shall for any reason fail to surrender or
deliver the Mortgaged Property or any part thereof after Mortgagee's demand
therefor, Mortgagee may seek to obtain a writ, judgment or decree conferring
on Mortgagee the right to immediate possession or requiring Mortgagor to
deliver immediate possession of all or any part of the Mortgaged Property to
Mortgagee. Mortgagor shall pay to Mortgagee, upon
17
demand, all reasonable costs and expenses of obtaining such judgment or
decree and reasonable compensation to Mortgagee, its attorneys and agents,
and all such costs, expenses and compensation shall, until paid, be Secured
Obligations secured by the lien of this Mortgage.
(c) Upon every such entry upon or taking of possession,
Mortgagee shall have the right, at the expense of Mortgagor, to operate,
manage and control the Mortgaged Property and to carry on the business
thereof in the name of Mortgagor or otherwise as Mortgagee shall deem best
and otherwise to exercise all or any of the rights described in the
Assignment of Leases and Income as set forth in Article IV, as it shall deem
best, and to make all such repairs, replacements, alterations, additions or
improvements to the Mortgaged Property or any part thereof as Mortgagee may
deem proper.
Section 7.5. LEASES. Mortgagee is authorized to foreclose this
Mortgage in accordance with the terms of this Mortgage subject to the rights
of any Tenants or may elect which Tenants Mortgagee desires to name as
parties defendant in such foreclosure, and the failure to make any such
Tenants parties defendant to any such foreclosure proceedings and to
foreclose their rights will not be, nor be asserted by Mortgagor to be, a
defense to any proceedings instituted by Mortgagee to collect the sums
secured hereby or to collect any deficiency remaining unpaid after the
foreclosure sale of the Mortgaged Property.
Section 7.6. FORECLOSURE; PROCEEDS OF SALE. At any foreclosure sale,
Mortgagee may bid for and acquire the Mortgaged Property or any part thereof
(and in lieu of paying cash therefor may make settlement for the purchase
price by crediting against the Secured Obligations then outstanding the net
sales price after deducting therefrom the expenses of the sale and the costs
of the auction and any other sums which Mortgagee is authorized to deduct
under this Mortgage) and, upon compliance with the terms of sale, may hold,
retain and possess and dispose of such property in its own absolute right
without further accountability. The proceeds of such sale shall be applied in
accordance with the Collateral Agency Agreement.
Section 7.7. WAIVER OF APPRAISEMENT, VALUATION, STAY, EXTENSION AND
REDEMPTION LAWS. Mortgagor agrees, to the fullest extent that it may lawfully
do so, that in the event of any Event of Default on its part hereunder,
neither Mortgagor nor anyone claiming through or under Mortgagor shall or
will claim, insist upon or plead or in any way take advantage of, and hereby
waives, any appraisement, valuation, stay, marshalling of assets, extension,
homestead or similar exemption, redemption or moratorium law now or hereafter
in force and effect. Mortgagor agrees that Mortgagee or any court having
jurisdiction to foreclose the lien of this Mortgage may sell the Mortgaged
Property in part or as an entirety.
Section 7.8. RECEIVER. If a Trigger Event shall have occurred and be
continuing and Mortgagee shall have received the Senior Party Certificates
from the Required Senior Parties pursuant to Section 2.3(a) of the Collateral
Agency Agreement, Mortgagee, without regard to the value or adequacy of any
security for the Secured Obligations and without regard for the solvency of
the Mortgagor, shall be entitled as a matter of right if it so elects,
without notice to Mortgagor except as provided below, to the appointment of a
receiver to enter upon and take possession of the Mortgaged Property and to
collect all Income and apply the same in accordance with the Indenture and
this Mortgage. Mortgagor agrees to, and does consent to, the appointment of a
receiver in the circumstance described in the preceding sentence.
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Notwithstanding the foregoing, if a Trigger Event shall have occurred and be
continuing and Mortgagee shall have received the Senior Party Certificates
from the Required Senior Parties pursuant to Section 2.3(a) of the Collateral
Agency Agreement, and in the event of threatened waste to any part of the
Mortgaged Property (but not actual waste), Mortgagee shall provide notice to
Mortgagor of its intention to appoint a receiver and shall permit Mortgagor a
reasonable period of time to eliminate the threatened waste prior to the
appointment of a receiver. The expenses, including receiver's fees,
reasonable attorneys' fees, costs and agent's compensation, incurred pursuant
to the powers herein contained shall be Secured Obligations secured by the
lien of this Mortgage. The right to enter and take possession of and to
operate, manage and control the Mortgaged Property and to collect all Income,
whether by a receiver or otherwise, shall be cumulative of any other right or
remedy hereunder or afforded by law and may be exercised concurrently
therewith or independently thereof. Mortgagee shall be liable to account only
for such Income as is actually received by Mortgagee, whether received
pursuant to this SECTION 7.8 or SECTION 7.2 hereof.
Section 7.9. LEGAL EXPENSES OF MORTGAGEE. Mortgagor shall pay to
Mortgagee, on demand, all costs, charges and expenses (including reasonable
attorneys' fees and disbursements) incurred or paid at any time by Mortgagee
(i) because of the failure of Mortgagor to pay, perform or observe any of the
Secured Obligations or (ii) in any litigation to prosecute or defend the
title, rights and lien created by this Mortgage (including an action to
foreclose this Mortgage or otherwise enforce Mortgagee's remedies hereunder),
together with interest on each such payment made by Mortgagee at the Adjusted
Base Rate plus three percent (3%) from the date each such payment is made
and, to the extent permitted by law, all such sums and the interest thereon
shall be Secured Obligations secured by the lien of this Mortgage.
Section 7.10. DELAY OR OMISSION. No delay or omission of Mortgagee
in exercising any right, power or remedy accruing upon any Event of Default
shall exhaust or impair any such right, power or remedy or shall be construed
to waive any such Event of Default or to constitute acquiescence therein.
Every right, power and remedy given to Mortgagee may be exercised from time
to time and as often as may be deemed expedient by Mortgagee.
Section 7.11. NO WAIVER OF ONE DEFAULT TO AFFECT ANOTHER. No waiver
of any Event of Default hereunder shall extend to or affect any subsequent or
any other Event of Default then existing, or impair any rights, powers or
remedies consequent thereon.
Section 7.12. NO MERGER. It is the intention of the parties hereto
that if Mortgagee shall at any time hereafter acquire title to all or any
portion of the Mortgaged Property, then, and until the Secured Obligations
have been paid and performed in full, the interest of Mortgagee under this
Mortgage shall not merge or become merged in or with the estate and interest
of Mortgagee as the holder and owner of title to the Mortgaged Property or
any part thereof and that, until such payment in full, the estate of
Mortgagee in the Mortgaged Property and the interest of Mortgagee under this
Mortgage shall be deemed separate and apart and shall continue in full force
and effect to the same extent as if Mortgagee had not acquired title to the
Mortgaged Property or any part thereof.
Section 7.13. MORTGAGEE'S RIGHTS TO PERFORM MORTGAGOR'S COVENANTS.
If a Trigger Event shall have occurred and be continuing and Mortgagee shall
have received the Senior Party Certificates from the Required Senior Parties
19
pursuant to Section 2.3(a) of the Collateral Agency Agreement, then, without
limiting any other provision of this Mortgage, and without waiving or
releasing Mortgagor from any Secured Obligation or default hereunder,
Mortgagee (or any receiver of the Mortgaged Property) may (but shall not be
obligated to), in order to preserve its interest in the Mortgaged Property,
and upon not less than two (2) days' prior written notice to Mortgagor,
except in case of an emergency, make any such payment or perform any other
act or take any appropriate action (including, without limitation, entry on
the Mortgaged Property and performance of work thereat) as Mortgagee, in its
reasonable discretion, may deem necessary, and all payments made and costs
and expenses incurred or paid by Mortgagee in correction therewith shall
become due and payable immediately. The amounts so incurred or paid by
Mortgagee, together with interest thereon at the Adjusted Base Rate plus
three percent (3%) from the date incurred until paid by Mortgagor, shall be
added to the Secured Obligations and secured by the Lien of this Mortgage.
Mortgagee is hereby empowered to enter and to authorize others to enter upon
the Mortgaged Property or any part thereof for the purpose of performing or
observing any such defaulted covenant, condition or term, without thereby
becoming liable to Mortgagor or any person in possession holding under
Mortgagor.
Section 7.14. MORTGAGEE'S RIGHT TO SPECIFIC PERFORMANCE. If a
Trigger Event shall have occurred and be continuing and Mortgagee shall have
received the Senior Party Certificates from the Required Senior Parties
pursuant to Section 2.3(a) of the Collateral Agency Agreement, then, without
limiting any other provisions of this Mortgage, and without waiving or
releasing Mortgagor from any Secured Obligations or default hereunder,
Mortgagee may (but shall not be obligated to), in order to protect its
interest in the Mortgaged Property, commence an action for specific
performance to cause Mortgagor to comply with any of the covenants contained
in this Mortgage or any other Financing Document.
Section 7.15. REMEDIES CUMULATIVE. No right, power or remedy
conferred upon or reserved to Mortgagee by this Mortgage is exclusive of any
other right, power or remedy, but each and every such right, power and remedy
shall be cumulative and concurrent and shall be in addition to any other
right, power and remedy given hereunder, or now or hereafter existing at law,
in equity or by statute.
Section 7.16. RIGHT TO RELEASE. Mortgagee at all times shall have
the right to release any part of the Mortgaged Property now or hereafter
covered by this instrument or any other security Mortgagee now has or may
hereafter have securing payment of all or any part of the Secured
Obligations, without releasing any other part of the Mortgaged Property or
other security, without impairing the Secured Obligations or any rights to
any deficiency, and without affecting the lien, assignment of rents and
security interest of this instrument as to the part or parts thereof not so
released.
ARTICLE VIII
PROVISIONS OF GENERAL APPLICATION
Section 8.1. MODIFICATIONS. No change, amendment, modification,
cancellation or discharge of this Mortgage, or any part hereof, shall be
valid unless in writing, dated and signed
20
by the party against whom enforcement of such change, amendment,
modification, cancellation or discharge is sought.
Section 8.2. JUDICIAL PROCEEDINGS; WAIVER OF JURY TRIAL. Any
judicial proceeding brought against any party with respect to this Mortgage
shall be brought in any court of competent jurisdiction in Middlesex County,
New Jersey and, by execution and delivery of this Mortgage, each party (i)
accepts, generally and unconditionally, the nonexclusive jurisdiction of such
courts and any related appellate court and irrevocably agrees to be bound by
any judgment rendered thereby in connection with any such claim and (ii)
irrevocably waives, to the greatest extent permitted by applicable law, any
objection it may now or hereafter have as to the venue of any such proceeding
brought in such a court or that such a court is an inconvenient forum.
MORTGAGOR IRREVOCABLY DESIGNATES, APPOINTS, AND EMPOWERS AND HEREBY CONFERS
AN IRREVOCABLE SPECIAL POWER, AMPLE AND SUFFICIENT, TO CT CORPORATION SYSTEM,
WITH OFFICES ON THE DATE HEREOF LOCATED IN ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇▇▇ AS ITS DESIGNEE, APPOINTEE AND AGENT WITH RESPECT TO ANY ACTION OR
PROCEEDING IN NEW JERSEY TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR, AND ON ITS
BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS,
SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR
PROCEEDING AND AGREES THAT THE FAILURE OF SUCH AGENT TO GIVE ANY ADVICE OF
ANY SUCH SERVICE OF PROCESS TO MORTGAGOR SHALL NOT IMPAIR OR AFFECT THE
VALIDITY OF SUCH SERVICE OR OF ANY CLAIM BASED THEREON. IF FOR ANY REASON
SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS
SUCH, MORTGAGOR AGREES TO DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN
NEW JERSEY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY
TO THE MORTGAGEE. MORTGAGOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID TO MORTGAGOR, AT ITS ADDRESS SET FORTH IN SECTION 8.12, SUCH
SERVICE TO BECOME EFFECTIVE ON THE THIRD (3RD) BUSINESS DAY AFTER SUCH
MAILING. Nothing herein shall affect the right of Mortgagor or Mortgagee to
serve process in any other manner permitted by law or shall limit the right
of Mortgagor or Mortgagee to bring proceedings against the other in the
courts of any other jurisdiction. MORTGAGOR AND MORTGAGEE DO EACH HEREBY
KNOWINGLY, VOLUNTARILY, UNCONDITIONALLY, IRREVOCABLY AND INTENTIONALLY
FOREVER WAIVE, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, THE RIGHT
TO A TRIAL BY JURY IN EVERY JURISDICTION IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM BROUGHT BY MORTGAGOR OR MORTGAGEE AGAINST THE OTHER OR THEIR
RESPECTIVE SUCCESSORS OR ASSIGNS IN RESPECT OF ANY MATTER ARISING OUT OF,
UNDER OR CONNECTED WITH (INCLUDING, WITHOUT LIMITATION, ANY ACTION TO RESCIND
OR CANCEL THIS MORTGAGE OR THE SECURED OBLIGATIONS, AND ANY CLAIMS ASSERTING
THAT THE INDENTURE OR ANY OTHER FINANCING DOCUMENT OR THE SECURED OBLIGATIONS
WERE FRAUDULENTLY INDUCED OR ARE OTHERWISE VOID OR VOIDABLE) THIS MORTGAGE,
THE INDENTURE, THE INDEBTEDNESS EVIDENCED BY THE INDENTURE, THE MORTGAGED
PROPERTY OR ANY OF THE OTHER
21
FINANCING DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY PERSON OR ANY EXERCISE BY ANY
PARTY OF THEIR RESPECTIVE RIGHTS UNDER THE FINANCING DOCUMENTS. THIS WAIVER
OF THE RIGHT TO A JURY TRIAL IS A MATERIAL INDUCEMENT FOR MORTGAGEE TO ACCEPT
THIS MORTGAGE.
Section 8.3. SATURDAY, SUNDAY OR NON-BUSINESS DAY. If the date for
the performance of any term, provision or condition (monetary or otherwise)
under the Financing Documents or this Mortgage shall happen to fall on a
Saturday, Sunday or non-Business Day, the date for the performance of such
term, provision or condition shall be extended to the next succeeding
Business Day immediately thereafter occurring, with interest at the rate
provided in the respective Financing Document on the outstanding principal
balance to such next succeeding Business Day if such term, provision or
condition shall result in the extension of any monetary payment due to
Mortgagee.
Section 8.4. USE OF THE WORD "HEREIN". The words "herein," "hereof,"
"hereinafter," "hereunder" and other words of similar import refer to this
Mortgage as a whole and not to any particular Article, Section, subsection or
other subdivision of this Mortgage unless specifically noted otherwise in
this Mortgage.
Section 8.5. MONIES. All references to monies in this Mortgage, the
Indenture or any of the Financing Documents, or the equivalent thereof, shall
be deemed to mean lawful monies of the United States of America.
Section 8.6. NO PARTNERSHIP OR JOINT VENTURE. Nothing herein, nor
the acts of the parties hereto, shall be deemed or construed to create a
partnership or joint venture between Mortgagor and Mortgagee.
Section 8.7. STAMP OR OTHER TAX. Should any stamp tax, intangible
tax, recording tax or other tax (excluding income, franchise, gross receipts
or similar taxes with respect to Mortgagee) now or hereafter become payable
with respect to this Mortgage, or their execution or delivery, Mortgagor will
pay the same prior to the due date thereof and hold Mortgagee harmless from
all costs arising from same (including, without limitation, costs arising
from Mortgagor's failure to timely pay same).
Section 8.8. ASSIGNMENT OF FINANCING DOCUMENTS: COVENANTS RUN WITH
LAND. The covenants, terms, conditions and agreements contained in this
Mortgage shall run with the land and bind Mortgagor, the heirs, executors,
administrators, principals, legal representatives, successors and assigns of
Mortgagor and each person constituting Mortgagor and all subsequent owners,
encumbrancers and Tenants of the Mortgaged Property, or any part thereof, and
shall inure to the benefit of Mortgagee its successors and assigns and all
subsequent beneficial owners of this Mortgage.
Section 8.9. RIGHTS OF THIRD-PARTIES. Mortgagee makes no
representations and assumes no obligations concerning the quality of the
construction of the Mortgaged Property or the absence therefrom of any
defects. In this regard, Mortgagor agrees to and shall indemnify Mortgagee
from any liability, claim or losses resulting from the condition of the
Mortgaged
22
Property, whether related to the quality of construction or otherwise and
whether arising during or after the term of the Indenture. This paragraph
shall survive the payment and performance of the Secured Obligations and
shall continue in full force and effect so long as the possibility of any
liability, claim or loss exists.
Section 8.10. NO AGENCY. Mortgagee is not the agent or
representative of Mortgagor, and Mortgagor is not the agent or representative
of Mortgagee, and nothing in this Mortgage shall be construed to make
Mortgagee liable to anyone for goods delivered or services performed by them
upon the Mortgaged Property or for debts or claims accruing to them against
Mortgagor. Nothing herein shall be construed to create a contractual
relationship between Mortgagee and anyone supplying labor or materials to the
Mortgaged Property.
Section 8.11. CONFLICTS AND INCONSISTENCIES/EFFECT OF INDENTURE. In
the event of a conflict between any provision of the Indenture and this
Mortgage, the Indenture shall control, except that this Mortgage shall
control with respect to (i) the imposition of the lien hereof and (ii) the
governing law applicable to this Mortgage as set forth in SECTION 8.17
hereof. To the extent the Indenture expressly permits any acts or conditions
prohibited hereunder (or which result in an Event of Default) or which are
expressly excluded from any prohibitions thereunder, such acts or conditions
shall be allowed without resulting in an Event of Default.
Section 8.12. NOTICES AND DELIVERIES; MANNER OF DELIVERY;
EFFECTIVENESS.
8.12.1. MANNER OF DELIVERY. All notices, communications and
materials (including all information) to be given or delivered pursuant to
this Mortgage shall be in writing (which shall include telex and telecopy
transmissions).
8.12.2. ADDRESSES. All notices, communications and
materials to be given or delivered pursuant to this Mortgage shall be given
or delivered at the following respective addresses and telecopier and
telephone numbers and to the attention of the following individuals or
departments:
if to Mortgagor, to it at:
AES Red Oak, L.L.C.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Project Manager
Telecopier/Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
The AES Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Telecopier/Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
if to Mortgagee, to it at:
▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telecopier/Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
or at such other address or telecopier or telephone number or to the
attention of such other individual or department as the party to which such
information pertains may hereafter specify for the purpose in a notice
specifically captioned "Notice of Change of Address" given to (i) if the
party to which such information pertains is the Mortgagor, the Mortgagee, and
(ii) if the party to which such information pertains is the Mortgagee, the
Mortgagor.
8.12.3. EFFECTIVENESS. Each notice and communication and
any material given or delivered under this Mortgage shall be deemed so given
or delivered (i) if sent by certified mail, postage prepaid, return receipt
requested, on the third Business Day after such notice, communication or
material, addressed as above provided, is delivered to a United States post
office and a receipt therefor is issued thereby, (ii) if sent by any other
means of physical delivery, when such notice, communication or material is
delivered to the appropriate address as above provided, and (iii) if sent by
telecopier, when such notice, communication or material is transmitted to the
appropriate telecopier number as above provided and is received at such
number.
8.12.4. REASONABLE NOTICE. Any requirement under applicable
law of reasonable notice by the Mortgagee to the Mortgagor of any event in
connection with, or in any way related to, this Mortgage or the exercise by
the Mortgagee of any of its rights hereunder or thereunder shall be met if
notice of such event is given to the Mortgagor in the manner prescribed above
at least ten (10) days before (i) the date of such event or (ii) the date
after which such event will occur.
Section 8.13. CAPTIONS. The captions and the table of contents
herein are inserted only for convenience and reference, and in no way define,
limit, enlarge or describe the scope or intent of this Mortgage or the
construction of any provision hereof. References herein to Articles,
Sections, subsections, paragraphs and subparagraphs are to those of this
Mortgage unless another document is specified.
Section 8.14. GENDER AND NUMBER. Wherever the context of this
Mortgage so requires, the masculine gender includes the feminine or neuter,
and the singular number or word includes the plural, and vice versa.
Section 8.15. SEVERABILITY. If any provision of this Mortgage or the
application thereof to any Person or circumstance shall to any extent be
invalid or unenforceable, the remainder of this Mortgage, or the application
of such provision to Persons or circumstances other than those as to which it
is invalid or unenforceable, shall not be affected thereby, and each
provision of this Mortgage shall be valid and enforceable to the fullest
extent permitted by law.
24
Section 8.16. FILING OF MORTGAGE, ETC. Mortgagor forthwith upon the
execution and delivery of this Mortgage and thereafter, from time to time,
will cause this Mortgage, and each instrument of further assurance to be
filed, registered or recorded in such manner and in such places as may be
required by any present or future law in order to publish notice of, and to
fully protect the priority of, the lien hereof and the interest of Mortgagee
in the Mortgaged Property. Mortgagor will pay all filing, registration or
recording fees, and all expenses incident to the preparation, execution and
acknowledgment of this Mortgage, any instrument of further assurance, any
mortgage supplemental hereto, any security instrument with respect to the
Mortgaged Property and any instrument of further assurance, any amendment or
restatement hereof, and any satisfaction or assignment of this Mortgage, and
Mortgagor will pay all Federal, state, county and municipal taxes, duties,
imposts, assessments and charges arising out of or in connection with the
execution, delivery and recording of this Mortgage, any mortgage supplemental
hereto, any amendment or restatement of this Mortgage, any security
instrument with respect to the Mortgaged Property or any instrument of
further assurance. Mortgagor shall hold harmless and indemnify Mortgagee, its
successors and assigns, against any liability incurred by reason of the
imposition of any tax on the making, delivery and recording of this Mortgage.
Section 8.17. CONTROLLING LAW. This Mortgage shall be governed by,
and construed and enforced in accordance with the law of the State.
Section 8.18. NO RECOURSE. In the event of non-performance by
Mortgagor of its obligations under this Mortgage, or any part thereof, or for
any claim based thereon or otherwise in respect thereof or related thereto,
no recourse shall be had to (i) any assets or properties of the Mortgagor (or
any person that controls the Mortgagor within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act) or (ii) any Affiliate
of the Mortgagor or any incorporators, officers, directors or employees
thereof, and no judgment relating to the obligations of the Mortgagor under
this Mortgage, or any part thereof, or for any claim based thereon or
otherwise in respect thereof or related thereto, shall be obtainable by the
Senior Parties or the Collateral Agent against the Mortgagor or any other
incorporator, stockholder, officer, employee or director past, present or
future of the Mortgagor or any Affiliate of the Mortgagor; provided, however,
that nothing contained herein shall prevent the taking of any action
permitted by law against the Mortgagor or any of its Affiliates, or in any
way affect or impair the rights of the Collateral Agent or Senior Parties to
take any action permitted by law, in either case to realize upon the
Collateral and, provided further, that nothing herein shall be deemed to
affect the obligations of any Affiliate of the Mortgagor under any
Transaction Document to which such Affiliate is a party.
Section 8.19. PLANT MORTGAGE. Mortgagor and Mortgagee intend that
this Mortgage shall be a plant or industrial mortgage and that the lien of
this Mortgage shall also extend to the real estate, fixtures, machinery,
equipment and personal property necessary to operate the Premises as a going
concern.
Section 8.20. FUTURE ADVANCES. In the event Mortgagee, DSR LOC
Provider, Working Capital Provider and/or PPA LOC Provider makes future
advances to Mortgagor, such future advances, with interest thereon, shall be
secured by this Mortgage, unless the parties shall agree otherwise in
writing. If any of such future advances should be applied to the payment of
any
25
existing debt owed by the Mortgagor, Mortgagee shall be subrogated to the
rights of the party to whom such payment is made.
Section 8.21. SECURITY AND PRIORITY OF ADVANCES. This Mortgage
secures, and the Secured Obligations include, future advances. Advances may
be made by Mortgagee, Working Capital Provider, DSR LOC Provider and/or the
PPA LOC Provider and indebtedness may be incurred from time to time
hereafter, but each such advance or indebtedness shall be secured hereby as
if made on the date hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
26
IN WITNESS WHEREOF, this Mortgage has been duly executed by
Mortgagor the day and year first above written.
MORTGAGOR:
AES RED OAK, L.L.C.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
MORTGAGEE:
THE BANK OF NEW YORK
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
27
CORPORATE ACKNOWLEDGMENT
DISTRICT _____________)
OF ) ss
COLUMBIA _____________)
On this 15th of March, 2000, before me, the undersigned, a notary
public in and for the District of Columbia, personally appeared ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ , the Vice President of AES Red Oak, L.L.C., a Delaware limited
liability company, the company named in the foregoing instrument, who, I am
satisfied, is the person who signed the within within instrument, and that he
is such vice president of the company, being authorized by virtue of a
resolution of the company, executed the foregoing instrument by signing the
name of such Company by himself as vice president of the company and
acknowledges same as his voluntary act and deed, the voluntary act and deed
of said limited liability company for the purposes therein contained.
Witness my hand and official seal.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Signature:
(SEAL)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Notary Public, District of Columbia
My Commission Expires: 4-1-02
THIS INSTRUMENT WAS PREPARED BY ▇▇▇▇▇▇▇▇▇ ▇▇▇, ESQ.
28
CORPORATE ACKNOWLEDGMENT
DISTRICT _____________)
OF ) ss
COLUMBIA _____________)
On this 15th of March, 2000, before me, the undersigned, a notary
public in and for the District of Columbia, personally appeared ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, the Vice President of The Bank of New York, a Delaware limited
liability company, the company named in the foregoing instrument, who, I am
satisfied, is the person who signed the within instrument, and that he is
such vice president of the company, being authorized by virtue of a
resolution of the company, executed the foregoing instrument by signing the
name of such Company by himself as vice president of the company and
acknowledges same as his voluntary act and deed, the voluntary act and deed
of said limited liability company for the purposes therein contained.
Witness my hand and official seal.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Signature:
(SEAL)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Notary Public, District of Columbia
My Commission Expires: 4-1-02
THIS INSTRUMENT WAS PREPARED BY ▇▇▇▇▇▇▇▇▇ ▇▇▇, ESQ.
29
EXHIBIT A
SITE
All that tract or parcel of land and premises, situate, lying and being in
the Borough of Sayreville in the County of Middlesex and State of New Jersey,
more particularly described as follows:
PARCEL I (FEE)
BEGINNING at a point in the Easterly line of Raritan River Railroad
right-of-way; said point being distant 719.16 feet on a course bearing of
North 05 degrees 35 minutes 10 seconds East from a point of curvature of a
curve having a radius of 443.3 feet; said point of beginning also being
distant 259.91 feet on a course bearing of South 05 degrees 35 minutes 10
seconds West from the point of intersection formed by the Easterly
right-of-way line of the Raritan River Railroad with the Southerly line of
lands now or formerly owned by the ▇▇▇▇▇▇▇ Company extended Easterly from the
point and place of beginning of Parcel "A" as described in Deed Book 2883
page 873 a distance of 70.00 feet on a course bearing South 85 degrees 11
minutes 00 seconds East, running thence from said beginning point:
(1) Along the Easterly line of the Raritan River Railroad North 5 degrees
35 minutes 10 seconds East a distance of 811.14 feet to a point and
corner; thence
(2) South 84 degrees 24 minutes 50 seconds East a distance of 38.72 feet to
a point and corner; thence
(3) North 24 degrees 50 minutes 30 seconds East a distance of 820.45 feet
to a point and corner; thence
(4) North 37 degrees 30 minutes 30 seconds East a distance of 509.70 feet
to a point and corner; thence
(5) North 56 degrees 20 minutes 30 seconds East a distance of 285.61 feet
to a point and corner; thence
(6) North 69 degrees 20 minutes 30 seconds East a distance of 242.34 feet
to a point and corner in the Westerly line of the Jersey Central Power
and Light Company easement, 150 feet wide; thence
(7) Along the Westerly line of said Jersey Central Power and Light Company
easement South 11 degrees 49 minutes 50 seconds East a distance of
1,163.29 feet to a point and corner; thence
(8) Continuing along the Westerly line of said Jersey Central Power and
Light Company easement South 57 degrees 21 minutes 50 seconds East a
distance of 383.51 feet to a point and corner ; thence
(9) South 28 degrees 12 minutes 20 seconds West a distance 425.47 feet to a
point and corner; thence
2
(10) South 28 degrees 10 minutes 30 seconds West a distance of 586.75 feet
to a point and corner; thence
(11) South 05 degrees 20 minutes 30 seconds West a distance of 146.75 feet
to a point and corner; thence
(12) South 82 degrees 20 minutes 30 seconds West a distance of 319.17 feet
to a point and corner; thence
(13) North 85 degrees 03 minutes 10 seconds West a distance of 562.61 feet
to a point of curvature; thence
(14) On the arc of a circle curving to the right having a radius of 520.00
feet an arc distance of 100.00 feet (chord bearing and distance North
79 degrees 32 minutes 37 seconds West 99.85 feet) to a point and
corner; thence
(15) South 15 degrees 57 minutes 56 seconds West a distance of 60.00 feet to
a point and corner; thence
(16) On the arc of a circle curving to the right having a radius of 580.00
feet an arc distance of 345.40 feet (chord bearing and distance North
56 degrees 58 minutes 27 seconds West 340.32 feet) to a point of
tangency; thence
(17) North 39 degrees 54 minutes 50 seconds West a distance of 46.44 feet
returning to the point and place of BEGINNING.
The above premises are commonly known as ▇▇▇ ▇, ▇▇▇▇▇ ▇▇.▇▇.
▇
▇▇▇▇▇▇▇ ▇
ACCESS EASEMENT
All that tract or parcel of land and premises, situate, lying and being in
the Borough of Sayreville in the County of Middlesex and State of New Jersey,
more particularly described as follows:
PARCEL II (ACCESS EASEMENT)
BEGINNING at a concrete monument in the Westerly line of the Raritan River
Railroad, said point being the point and place of beginning of Parcel "A" as
described in Deed Book 2883 page 873 and running thence from said beginning
point:
(1) North 85 degrees 11 minutes 00 seconds West a distance of 934.57 feet
to a point and corner in the Easterly line of Jernees Mill Road; thence
(2) On a line parallel to and distant 44 feet measured at a right angle
from the centerline of ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ degrees 56 minutes 50
seconds East a distance of 60.47 feet to a point; thence
(3) South 85 degrees 11 minutes 00 seconds East a distance of 927.86 feet
to a point in the Westerly line of the Raritan River Railroad; thence
(4) Along the Westerly line of the Raritan River Railroad South 05 degrees
35 minutes 10 seconds West a distance of 60.00 feet returning to the
point and place of BEGINNING.
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EXHIBIT C
SIGHT TRIANGLE EASEMENTS
All that tract or parcel of land and premises, situate, lying and being in
the Borough of Sayreville in the County of Middlesex and State of New Jersey,
more particularly described as follows:
PARCEL III (SIGHT TRIANGLE EASEMENTS)
EASEMENT "A"
BEGINNING at the point of intersection formed by the Easterly line of Jernees
Mill Road (also known as Middlesex County Road # 3-R-18) with the Northerly
line of a proposed 60 foot road as shown and delineated on a map entitled,
"final subdivision Plat For: Forest View Industrial Park," dated December 1,
1988 and is about to be filed at the Office of The Middlesex County Clerk;
said beginning point being distant 44 feet measured at a right angle from the
centerline of Jernees Mill Road, running thence from said beginning point:
(1) Along the Easterly line of ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ degrees 56
minutes 50 seconds East a distance of 96.60 feet to a point; thence
(2) South 08 degrees 33 minutes 17 seconds East a distance of 98.52 feet to
a point in the Northerly line of said proposed 60 foot wide road;
thence
(3) Along the Northerly line of said proposed North 85 degrees 11 minutes
00 seconds West a distance of 34.78 feet returning to the point and
place of BEGINNING.
EASEMENT "B"
BEGINNING at the point of intersection formed by the Easterly line of Jernees
Mill Road (also known as Middlesex County Road # 3-R-18) with the Northerly
line of a proposed 60 foot road as shown and delineated on a map entitled,
"Final Subdivision Plat For: Forest View Industrial Park," dated December 1,
1988 and is about to be filed at the Office of The Middlesex County Clerk;
said beginning point being distant 44 feet measured at a right angle from the
centerline of Jernees Mill Road, running thence from said beginning point:
(1) Along the Southerly line of said proposed 60 foot wide Road South 85
degrees 11 minutes 00 seconds East a distance of 34.78 feet to a point;
thence
(2) South 30 degrees 49 minutes 29 seconds West a distance of 22.26 feet to
a point in the Easterly line of Jernees Mill Road; thence
(3) North 85 degrees 11 minutes 00 seconds West a distance of 27.52 feet to
a point in the Easterly line of Jernees Mill Road; thence
(4) Along the Easterly line of ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ degrees 56
minutes 50 seconds East a distance of 20.16 feet returning to the point
and place of BEGINNING.
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EXHIBIT D
CONRAIL PROPERTY
Block 62.04, portion of Lot 5
(described below)
Diagram of Conrail Utility Crossing
for AES Red Oak Power Plant
▇▇▇ ▇, ▇▇▇▇▇ ▇▇.▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇. ▇▇
by
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Professional Engineer
New Jersey License No. 24347
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