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SECOND RESTATED MORTGAGE
AND
SECURITY AGREEMENT
Made By And Between
CAP ROCK ELECTRIC COOPERATIVE, INC.
Mortgagor
and
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
Mortgagee
Dated as of
October 24, 1995
THIS INSTRUMENT GRANTS A SECURITY INTEREST BY A UTILITY
***
THIS INSTRUMENT CONTAINS FUTURE ADVANCE PROVISIONS
***
THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS
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CFC Form C48 (Class A)
Electric Mortgage for Non-RUS Borrowers
Rev. 1/20/95
TX 107-A-9043 (RBA)
TABLE OF CONTENTS
PAGE
ARTICLE I
Section 1.01 Definitions 1
Section 1.02 Construction 5
ARTICLE II
SECURITY
Section 2.01 Granting Clause 6
ARTICLE III
ADDITIONAL NOTES
Section 3.01 Additional Notes 8
ARTICLE IV
PARTICULAR COVENANTS OF THE MORTGAGOR
Section 4.01 Authority to Execute and Deliver Notes and
Mortgages; All Action Taken; Enforceable
Obligations 9
Section 4.02 Authority to Mortgage Property; No Liens; Exception
for Permitted Encumbrances; Mortgagor to Defend
Title and Remove Liens 9
Section 4.03 No Encumbrances on Property 9
Section 4.04 Additional Permitted Debt 9
Section 4.05 Payment of Notes 10
Section 4.06 Preservation of Corporate Existence and
Franchises 10
Section 4.07 Maintenance of Mortgaged Property 10
TABLE OF CONTENTS; Continued
PAGE
Section 4.08 Insurance; Restoration of Damaged Mortgaged
property 11
Section 4.09 Mortgagee Right to Expend Money to Protect
Mortgaged Property 12
Section 4.10 Further Assurances 12
Section 4.11 Application of Proceeds from Condemnation 12
Section 4.12 Compliance with Loan Agreements; Notice of
Amendments to, and Defaults under Loan
Agreements 12
Section 4.13 Rights of Way, etc 13
ARTICLE V
REMEDIES OF THE MORTGAGEE
Section 5.01 Events of Default 13
Section 5.02 Acceleration of Maturity; Recision and
Amendment 14
Section 5.03 Remedies of Mortgagee 15
Section 5.04 Application of Proceeds from Remedial
Actions 16
Section 5.05 Remedies Cumulative; No Election 16
Section 5.06 Waiver of Appraisement Rights 16
Section 5.07 Notice of Default 16
-ii-
TABLE OF CONTENTS; Continued
PAGE
ARTICLE VI
POSSESSION UNTIL DEFAULT - DEFEASANCE CLAUSE
Section 6.01 Possession Until Default 17
Section 6.02 Defeasance 17
ARTICLE VII
MISCELLANEOUS
Section 7.01 Property Deemed Real Property 17
Section 7.02 Mortgage to Bind and Benefit Successors and
Assigns 17
Section 7.03 Headings 18
Section 7.04 Notices 18
Section 7.05 Severability 18
Section 7.06 Mortgage Deemed Security Agreement 18
Section 7.07 Indemnification by Mortgagor of Mortgagee 19
APPENDIX A
APPENDIX B
APPENDIX C
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SECOND RESTATED MORTGAGE AND SECURITY AGREEMENT, dated as of
October 24, 1995 (hereinafter called this "Mortgage") is made by and
between CAP ROCK ELECTRIC COOPERATIVE, INC. (hereinafter called the
("Mortgagor"), a corporation existing under the laws of the State of
Texas, (the "State") and NATIONAL RURAL UTILITIES COOPERATIVE FINANCE
CORPORATION (hereinafter called "CFC" or the "Mortgagee"), a
corporation existing under the laws of the District of Columbia.
RECITALS
WHEREAS, the Mortgagor and CFC are parties to that certain Restated
Mortgage and Security Agreement dated as of March 30, 1993, as supplemented,
amended or restated (the "Original Mortgage" identified in Appendix "A" of
this Mortgage) originally entered into between the Mortgagor and CFC; and
WHEREAS, this Mortgage restates and consolidates the Original
Mortgage while preserving the priority of CFC's Lien under the Original
Mortgage and secures the payment of Mortgagor's outstanding and current
secured indebtedness to CFC, which indebtedness is described more
particularly by listing the Original Notes in Appendix "A" hereto; and
WHEREAS, the Mortgagor and CFC are authorized to enter into this
Mortgage;
NOW, THEREFORE, the parties hereto, in consideration of the mutual
covenants contained herein, do agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. In addition to the terms defined
elsewhere in this Mortgage, the terms defined in this Article I shall have
the meanings specified herein and/or under the applicable Uniform Commercial
Code, unless the context clearly requires otherwise. The terms defined herein
include the plural as well as the singular and the singular as well as the
plural.
ADDITIONAL NOTES shall mean any Notes issued by the Mortgagor to CFC or any
other lender pursuant to Article III of this Mortgage including any
refunding, renewal, or substitute Notes which may from time to time be
executed and delivered by the Mortgagor pursuant to the terms of Article III.
BUSINESS DAY shall mean any day that CFC is open for business.
CFC is defined in the recitals to this Mortgage and shall include its
successors and assigns.
CFC Notes shall mean the Original CFC Notes and any Additional Notes issued
by the Mortgagor to CFC.
DEBT SERVICE COVERAGE RATIO ("DSC") shall mean the ratio determined as
follows: for any calendar year add (i) Patronage Capital and Operating
Margins, (ii) Non-Operating Margins-Interest, (iii) Interest Expense, (iv)
Depreciation and Amortization Expense for such year, and (v) cash received in
respect of generation and transmission and other capital credits, and divide
the sum so obtained by the sum of all payments of Principal and Interest
Expense during such calendar year; PROVIDED, HOWEVER, that in the event that
any Long-Term Debt has been refinanced during such year the payments of
Principal and Interest Expense required to be made during such year on
account
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of such Long-Term Debt shall be based (in lieu of actual payments required to
be made on such refinanced Debt) upon the larger of (i) an annualization of
the payments required to be made with respect to the refinancing debt during
the portion of such year such refinancing debt is outstanding or (ii) the
payment of Principal and Interest Expense required to be made during the
following year on account of such refinancing debt.
DEPRECIATION AND AMORTIZATION EXPENSE shall mean an amount constituting the
depreciation and amortization of the Mortgagor as computed for purposes of
Form 7.
EQUITIES AND MARGINS shall mean Mortgagor's equities and margins as such
terms are defined by generally accepted accounting principles.
EQUITY shall mean the aggregate of Mortgagor's Equities and Margins as
computed pursuant to generally accepted accounting principles.
EVENT OF DEFAULT shall have the meaning specified in Section 5.01 hereof.
EXCEPTED PROPERTY shall mean the properties, if any, identified on Appendix C
hereto.
FISCAL YEAR shall mean the fiscal year of the Mortgagor.
FORM 7 shall mean the form so identified by CFC or, if no such form is
applicable to the accounts of the Mortgagor, such reference shall apply to
the corresponding information otherwise determined in accordance with
generally accepted accounting principles.
INTEREST EXPENSE shall mean an amount constituting the interest expense with
respect to Total Long-Term Debt of the Mortgagor as computed for purposes of
Form 7. In computing Interest Expense, there shall be added, to the extent
not otherwise included, an amount equal to 33-1/3% of the excess of
Restricted Rentals paid by the Mortgagor over 2% of the Mortgagor's Equities
and Margins.
LIEN shall mean any statutory or common law consensual or non- consensual
mortgage, pledge, security interest, encumbrance, lien, right of set off,
claim or charge of any kind, including, without limitation, any conditional
sale or other title retention transaction, any lease transaction in the
nature thereof and any secured transaction under the Uniform Commercial Code.
Loan Agreements shall mean any loan agreement executed by and between the
Mortgagor and CFC in connection with the execution and delivery of any Notes
secured hereby and any loan agreement between the Mortgagor and another
mortgagee in connection with the execution and delivery of any Notes secured
hereby.
LONG-TERM DEBT shall mean any amount included in Tonal Long-Term Debt
pursuant to generally accepted accounting principles.
LONG-TERM LEASES shall mean leases having unexpired terms (taking into
account terms of renewal at the option of the lessor, whether or not such
leases have previously been renewed) of more than 12 months.
MAXIMUM DEBT LIMIT, if any, shall mean the amount more particularly described
in Appendix "A" hereto.
MORTGAGED PROPERTY shall have the meaning specified in Section 2.01 hereof.
MORTGAGEE shall mean CFC, its successor and assigns.
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NON-OPERATING MARGINS-INTEREST shall mean the amount of non- operating
margins-interest of Mortgagor as computed for purposes of Form 7.
NOTE OR NOTES shall mean one or more of the CFC Notes, and any other Notes
which pursuant to Article III may, from time to time, be secured under this
Mortgage.
ORIGINAL CFC NOTES shall mean the Notes evidencing outstanding and current
indebtedness of the Mortgagor to CFC as of the date of this Mortgage, listed
on Appendix "A" hereto.
OUTSTANDING shall mean all Notes heretofore issued as of the date of
determination except Notes the principal and interest on which have been
fully paid and which have been canceled by the Mortgagee or Notes the payment
for which has been provided for pursuant to Section 6.02.
PATRONAGE CAPITAL AND OPERATING MARGINS shall mean the net amount of
operating revenue and patronage capital less the total cost of electric
service of the Mortgagor as computed for purposes of Form 7.
PERMITTED DEBT shall have the meaning specified in Section 4.04.
PERMITTED ENCUMBRANCES shall mean:
(i) any Liens for taxes, assessments or governmental charges
for the current year and taxes, assessments or governmental
charges not due and delinquent;
(ii) Liens for workmen's compensation awards and similar
obligations not then delinquent;
(iii) mechanics', laborers', materialmen's and similar Liens not then
delinquent, and any such Liens, whether or not delinquent, whose
validity is at the time being contested in good faith;
(iv) Liens and charges incidental to construction or current operation
which have not been filed or asserted or the payment of which has been
adequately secured or which, in the opinion of counsel to the Mortgagor
are insignificant in amount;
(v) Liens, securing obligations not assumed by the Mortgagor and on
account of which it does not pay and does not expect to pay interest,
existing upon real estate (or rights in or relating to real estate)
over or in respect of which the Mortgagor has a right-of-way or-other
easement for substation, transmission, distribution or other
right-of-way purposes;
(vi) any right which the United States of America or any state or
municipality or governmental body or agency may have by virtue of any
franchise, license, contract or statute to purchase, or designate a
purchaser of, or order the sale of, any property of the Mortgagor upon
payment of reasonable compensation there for, or upon reasonable
compensation or conditions to terminate any franchise, license or other
rights before the expiration date hereof or to regulate the property
and business of the Mortgagor;
(vii) attachment of judgment Liens covered by insurance, or
upon appeal and covered by bond;
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(viii) deposits or pledges to secure payment of workmen's
compensation, unemployment insurance, old age pensions or
other social security;
(ix) deposits or pledges to secure performance of bids, tenders,
contracts (other than contracts for the payment of borrowed
money),leases, public or statutory obligations;
(x) surety or appeal bonds, and other deposits or pledges for
purposes of like general nature in the ordinary course of
business;
(xi) easements or reservations in respect to any property for the
purpose of transmission and distribution lines and rights- of-way and
similar purposes, zoning ordinances, regulations, reservations,
restrictions, covenants, party wall agreements, conditions of record
and other encumbrances (other than to secure the payment of money),
none of which in the opinion of counsel to the Mortgagor is such as to
interfere with the proper operation of the property affected thereby;
(xii) the burdens of any law or governmental organization or permit
requiring the Mortgagor to maintain certain facilities or perform
certain acts as a condition of its occupancy of or interference with
any public land or any river, stream or other waters or relating to
environmental matters;
(xiii) any Lien or encumbrance for the discharge of which moneys have
been deposited in trust with a proper depository to apply such moneys
to the discharge of such Lien or encumbrances;
(xiv) any Lien reserved as security for rent or compliance with other
provisions of the lease in case of any leasehold estate made, or
existing on property acquired, in the ordinary course of business or in
connection with Restricted Rentals permitted by Section 4.04; and
(xv) purchase money indebtedness permitted by Section 4.04.
PRINCIPAL shall mean the amount of principal billed on account of Total
Long-Term Debt of Borrower as computed for purposes of Form 7.
RESTRICTED RENTALS shall mean all rentals required to be paid under finance
leases and charged to income, exclusive of any amounts paid under any such
lease (whether or not designated therein as rental or additional rental) for
maintenance or repairs, insurance, taxes, assessments, water rates or similar
charges. For the purpose of this definition the term "finance lease" shall
mean any lease having a rental term (including the term for which such lease
may be renewed or extended at the option of the lessee) in excess of 3 years
and covering property having an initial cost in excess of $250,000 other than
automobiles, trucks, trailers, other vehicles (including without limitation
aircraft and ships) , office, garage and warehouse space and office equipment
(including without limitation computers).
SECURITY INTEREST shall mean any assignment, transfer, mortgage,
hypothecation or pledge.
SUBORDINATED INDEBTEDNESS shall mean indebtedness of the Mortgagor, payment
of which shall be subordinated to the prior payment of the Notes by
subordination agreement in form and substance satisfactory to the Mortgagee
which approval will not be unreasonably withheld.
TOTAL ASSETS shall mean an amount constituting the total assets of the
Mortgagor as computed for purposes of Form 7.
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TOTAL LONG-TERM DEBT shall mean an amount constituting the long- term debt of
the Mortgagor as computed for purposes of Form 7.
TOTAL UTILITY PLANT shall mean the amount constituting the total utility
plant of the Mortgagor computed in accordance with generally accepted
accounting principles. Uniform Commercial Code shall mean the Uniform
Commercial Code of any state in which any of the Mortgaged Property is
located.
SECTION 1.02. CONSTRUCTION
a. Accounting terms not referred to above are used in this Mortgage
in accordance with generally accepted accounting principles.
b. Except as set forth in Article V, whenever this Mortgage requires
the consent or approval of the Mortgagee, if there is more than one
mortgagee, such consent or approval shall be given by CFC so long as CFC, or
its assignee, is the noteholder of a majority of the aggregate unpaid
principal balance of the Notes Outstanding and otherwise by each other
noteholder having at least 10% of the aggregate unpaid principal balance of
the Notes outstanding.
ARTICLE II
SECURITY
SECTION 2.01. GRANTING CLAUSE. In order to secure the payment of the
principal of (and premium, if any) and interest on the Notes, according to
their terms, and further to secure the due performance of the covenants,
agreements and provisions contained in this Mortgage and the Loan Agreements,
and to declare the terms and conditions upon which the Notes are to be
secured, the Mortgagor, in consideration of the premises, does hereby grant,
bargain, sell, alienate, convey, assign, transfer, mortgage, hypothecate,
pledge, set over and confirm unto the Mortgagee, and their respective
assigns, all property, rights, privileges and franchises of the Mortgagor of
every kind and description, real, personal or mixed, tangible or intangible,
whether now owned or hereafter acquired by the Mortgagor, wherever located,
and grants a security interest therein for the purposes herein expressed,
except any Excepted Property, and including all and singular the following
described property (all of which is hereinafter called the "Mortgaged
Property")
I
All right title and interest of the Mortgagor in and to the electric
generating plants and facilities and electric transmission and distribution
lines and facilities now owned by the Mortgagor and located in the counties
listed in Appendix B hereto, or hereafter constructed or acquired by the
Mortgagor, wherever located, and in and to all extensions and improvements
thereof and additions thereto, including any and all other property of every
nature and description, used or acquired for use by the Mortgagor in
connection therewith, and including, without limitation, the property
described in the property schedule listed on, or attached to, Appendix B
hereto;
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II
All right, title and interest of the Mortgagor in, to and under any
and all grants, privileges, rights of way And easements now owned, held,
leased, enjoyed or exercised, or which may hereafter be owned, held, leased,
acquired, enjoyed or exercised, by the Mortgagor for the purposes of, or in
connection with, the construction or operation by or on behalf of the
Mortgagor of electric transmission or distribution lines or systems, whether
underground or overhead or otherwise, or of any electric generating plant,
wherever located;
III
All right, title and interest of the Mortgagor in, to and under any
and all licenses, ordinances, privileges and permits heretofore granted,
issued or executed, or which may hereafter be granted, issued or executed, to
it or to its assignors by the United States of America, or by any state, or
by any county, township, municipality, village or other political subdivision
thereof, or by any agency, board, commission or department of any of the
foregoing, authorizing the construction, acquisition, or operation of
electric transmission or distribution lines, or systems, or any electric
generating plant or plants, insofar as the same may by law be assigned,
granted, bargained, sold, conveyed, transferred, mortgaged or pledged;
IV
All right, title and interest of the Mortgagor in, to and under any
and all contracts heretofore or hereafter executed by and between the
Mortgagor and any person, firm, corporation or governmental body or agency
providing for the purchase, sale, exchange or transmission of electric power
or energy by the Mortgagor together with any and all other accounts, contract
rights and general intangibles (as such terms are defined in the applicable
Uniform Commercial Code) heretofore or hereafter acquired by the Mortgagor,
including, without limitation, the accounts, contract rights and general
intangibles described in Appendix B hereto;
V
Also, all right, title and interest of the Mortgagor in and to all other
property, real or personal, tangible or intangible, of every kind, nature and
description, and wheresoever situated, now owned or hereafter acquired by the
Mortgagor, it being the intention hereof that all such property now owned but
not specifically described herein or acquired or held by the Mortgagor after
the date hereof shall be as fully embraced within and subjected to the lien
hereof as if the same were now owned by the Mortgagor and were specifically
described herein to the extent only, however, that the subjection of such
property to the lien hereof shall not be contrary to law;
Together with all rents, income, revenues, profits, cash, proceeds
and benefits at any time derived, received or had from any and all of the
above-described property or business operations of the Mortgagor, to the
fullest extent permitted by law.
PROVIDED, HOWEVER, that no automobiles, trucks, trailers, tractors
or other vehicles (including, without limitation, aircraft or ships, if any)
owned or used by the Mortgagor-shall be included in the Mortgaged Property.
TO HAVE AND TO HOLD all and singular the Mortgaged Property unto the
Mortgagee and their respective assigns forever, to secure equally and ratably
the payment of the principal of (premium, if any) and interest on the Notes,
according to their terms, without preference, priority or distinction as to
interest or principal (except as otherwise specifically provided herein) or
as
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to lien or otherwise of any Note over any other Note by reason of the
priority in time of the execution, delivery or maturity thereof or of the
assignment or negotiation thereof, or otherwise, and to secure the due
performance of the covenants, agreements and provisions herein and in the
Loan Agreements contained, and for the uses and purposes and upon the terms,
conditions, provisos and agreements hereinafter expressed and declared.
ARTICLE III
ADDITIONAL NOTES
SECTION 3.01. ADDITIONAL NOTES. Without the prior consent of the
Mortgagee, the Mortgagor may issue Additional Notes to CFC or to another
lender which Notes will thereupon be secured equally and ratably with the
Notes if the following requirements are satisfied:
(1) As evidenced by a certificate of an independent accountant
delivered to the Mortgagee, the Mortgagor shall have achieved (x) for
each of the two calendar years preceding, or any two consecutive 12
month periods ending within 180 days preceding the issuance of such
Notes, a DSC of not less than 1.35 and (y) Equity of not less than 20%
of Total Assets after taking into consideration such new indebtedness
and the assets created by such indebtedness;
(2) No Event of Default or any event which with the giving of notice or
lapse of time or both would become an Event of Default has occurred and
is continuing hereunder; and
(3) At least 95% of the proceeds of the borrowings represented by such
Additional Notes are for the purpose of acquiring or constructing new
or replacement electric utility or general plant.
The Mortgagor shall also have the right without the consent of the Mortgagee,
so long as an Event of Default or any event which with the giving of notice
or lapse of time or both would become an Event of Default, has not occurred
and is continuing hereunder, to issue Additional Notes for the purpose of
refunding or refinancing any Notes so long as the total amount of outstanding
indebtedness evidenced by any such Additional Note is not greater than 105
percent of the Note being refunded or refinanced.
ARTICLE IV
PARTICULAR COVENANTS OF THE MORTGAGOR
The Mortgagor covenants with the Mortgagee from time to time, as
follows:
SECTION 4.01. AUTHORITY TO EXECUTE AND DELIVER NOTES AND MORTGAGES;
ALL ACTION TAKEN; ENFORCEABLE OBLIGATIONS. The Mortgagor is authorized under
its articles of incorporation and bylaws and all applicable laws and by
corporate action to execute and deliver the Notes and any Additional Notes
and this Mortgage; and the Notes and this Mortgage are, and any Additional
Notes when executed and delivered will be, the valid and enforceable
obligations of the Mortgagor in accordance with their respective terms.
SECTION 4.02. AUTHORITY TO MORTGAGE PROPERTY; NO LIENS; EXCEPTION
FOR PERMITTED ENCUMBRANCES; MORTGAGOR TO DEFEND TITLE AND REMOVE LIENS. The
Mortgagor warrants that it has good right and lawful authority to mortgage
the
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Mortgaged Property for the purposes herein expressed, and that the Mortgaged
Property is free and clear of any Lien, affecting the title thereto, except
the lien of this Mortgage and Permitted Encumbrances. Except as to Permitted
Encumbrances, the Mortgagor will, so long As any of the Notes shall be
Outstanding, maintain and preserve the lien of this Mortgage superior to all
other Liens affecting the Mortgaged Property and will forever warrant and
defend the title to the Mortgaged Property against any and all claims and
demands. Except as to Permitted Encumbrances, the Mortgagor will promptly pay
or discharge any and all obligations for or on account of which any such Lien
or charge might exist or could be created and any and all lawful taxes,
rates, levies, assessments, Liens, claims or other charges imposed upon or
accruing upon any of the Mortgagor's property (whether taxed to the Mortgagor
or to the Mortgagee), or the franchises, earnings or business of the
Mortgagor, as and when the same shall become due and payable; and when called
upon so to do the Mortgagor will furnish to the Mortgagee adequate proof of
such payment or discharge; PROVIDED, HOWEVER, that this provision shall not
be deemed to require the payment or discharge of any tax, rate, levy,
assessment or other governmental charge while the Mortgagor is contesting the
validity thereof by appropriate proceedings in good faith and so long as it
shall have set aside on its books adequate reserves with respect thereto.
SECTION 4.03. NO ENCUMBRANCES ON PROPERTY. Except to secure loans
made to the Mortgagor by the Mortgagee, the Mortgagor will not, without the
prior written consent of the Mortgagee, create or incur or suffer or permit
to be created or incurred or to exist any Lien, charge, assignment, pledge,
mortgage on any of the Mortgaged Property prior to or on a parity with the
Lien of this Mortgage except for the Permitted Encumbrances. Subject to the
provisions of Section 4.04, or unless approved by the Mortgagee, the
Mortgagor will purchase all materials, equipment and replacements to be
incorporated in or used in connection with the Mortgaged Property outright
and not subject to any conditional sales agreement, chattel mortgage,
bailment, lease or other agreement reserving to the seller any right, title
or Lien.
SECTION 4.04. ADDITIONAL PERMITTED DEBT. Except as permitted by
Section 3.01 and the Loan Agreements, the Mortgagor shall not incur, assume,
guarantee or otherwise become liable in respect of any debt (including
Subordinated Indebtedness) other than the following: ("Permitted Debt")
(1) Purchase money indebtedness in non-electric utility
property, in an amount not exceeding 10% of Total
Utility Plant or 50% of Equity, whichever is greater;
(2) Restricted Rentals in an amount not to exceed 5% of
Equity -during any 12 consecutive calendar month
period;
(3) Unsecured current debt and lease obligations
incurred in the ordinary course of business
including accounts payable for goods and services;
and
(4) Unsecured indebtedness.
SECTION 4.05. PAYMENT OF NOTES. The Mortgagor will duly and
punctually pay the principal of (premium, if any) and interest on the Notes
at the dates and places and in the manner provided therein, and all other
sums becoming due hereunder.
SECTION 4.06. PRESERVATION OF CORPORATE EXISTENCE AND FRANCHISES.
The Mortgagor will, so long as any of the Notes are outstanding, take or
cause to be taken all such action as from time to time may be necessary to
preserve its corporate existence and to preserve and renew all franchises,
rights of way, easements, permits, and licenses now or hereafter to be
granted or upon it
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conferred, and will comply with all valid laws, ordinances, regulations, and
requirements applicable to it or its property.
SECTION 4.07. MAINTENANCE OF MORTGAGED PROPERTY. So long as the
Mortgagor holds title to the Mortgaged Property, the Mortgagor will at all
times maintain and preserve the Mortgaged Property and each and every part
and parcel thereof in good repair, working order and condition, ordinary wear
and tear and acts of God excepted, and in compliance with all applicable
laws, regulations and orders, and will from time to time make all needed and
proper repairs, renewals, and replacements, and useful and proper
alterations, additions, betterments and improvements, and will, subject to
contingencies beyond its reasonable control, at all times keep its plant and
properties in continuous operating condition and use all reasonable diligence
to furnish the consumers served by it through the Mortgaged Property, or any
part thereof, with an adequate supply of electric energy and other services
furnished by the Mortgagor. If any substantial part of the Mortgaged Property
is leased by the Mortgagor to any other party, the lease agreement between
the Mortgagor and the lessee shall obligate the lessee to comply with the
provisions of this Section in respect of the leased facilities and permit the
Mortgagor-to operate the leased facilities in the event of any failure by the
lessee to so comply.
SECTION 4.08. INSURANCE; RESTORATION OF DAMAGED MORTGAGED PROPERTY.
The Mortgagor will take out, as the respective risks are incurred, and
maintain the classes and amounts of insurance in conformance with generally
accepted utility industry standards for such classes and amounts of coverages
of utilities of the size and character of the Mortgagor.
The foregoing insurance coverage shall be obtained by means of bond
and policy forms approved by regulatory authorities, and, with respect to
insurance upon any part of the Mortgaged Property, shall provide that the
insurance shall be payable to the Mortgagee as their interest may appear by
means of the standard mortgagee clause without contribution. Each policy or
other contract for such insurance shall contain an agreement by the insurer
that, notwithstanding any right of cancellation reserved to such insurer,
such policy or contract shall continue in force for at least thirty (30) days
after written notice to the Mortgagee of cancellation.
In the event of damage to or the destruction or loss of any portion
of the Mortgaged Property which shall be covered by insurance, unless the
Mortgagee shall otherwise agree, the Mortgagor shall replace or restore such
damaged, destroyed or lost portion so that the Mortgaged Property shall be in
substantially the same condition as it was in prior to such damage,
destruction or loss, and shall apply the proceeds of the insurance for that
purpose. The Mortgagor shall replace the lost portion of the Mortgaged
Property or shall commence such restoration promptly after such damage,
destruction or loss shall have occurred and shall complete such replacement
or restoration as expeditiously as practicable, and shall pay or cause to be
paid out of the proceeds of such insurance all costs and expenses in
connection therewith so that such replacement or restoration shall be so
completed that the portion of the Mortgaged Property so replaced or restored
shall be free and clear of all mechanics' liens and other claims.
Sums recovered under any policy or fidelity bond by the Mortgagor
for a loss of funds advanced under the Notes or recovered by the Mortgagee
for any loss under such policy or bond shall, unless otherwise directed by
the Mortgagee, be applied to the prepayment of the Notes PRO RATA according
to the unpaid principal amounts thereof (such prepayments to be applied to
such notes and installments thereof as may be designated by the Mortgagee at
the time of any such prepayment), or be used to construct or acquire
facilities which will become part of the Mortgaged Property. At the request
of the Mortgagee, the Mortgagor shall exercise such rights and remedies which
it may have under such
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policy or fidelity bond and which may be designated by the Mortgagee, and the
Mortgagor hereby irrevocably appoints the Mortgagee as its agent to exercise
such rights and remedies under such policy or bond as the Mortgagee may
choose, and the Mortgagor shall pay all costs and expenses incurred by the
Mortgagee in connection with such exercise.
SECTION 4.09. MORTGAGEE RIGHT TO EXPEND MONEY TO PROTECT MORTGAGED
PROPERTY. The Mortgagor agrees that the Mortgagee from time to time hereunder
may, in its sole discretion, after having given five (5) Business Days prior
written notice to Mortgagor, but shall not be obligated to, advance funds on
behalf of Mortgagor, in order to insure Mortgagor compliance with any
covenant, warranty, representation or agreement of Mortgagor made in or
pursuant to this Mortgage or any of the Loan Agreements, to preserve or
protect any right or interest of the Mortgagee in the Mortgaged Property or
under or pursuant to this Mortgage or any of the Loan Agreements, including
without limitation, the payment of any insurance premiums or taxes and the
satisfaction or discharge of any judgment or any Lien upon the Mortgaged
Property or other property or assets of Mortgagor; PROVIDED, HOWEVER, that
the making of any such advance by the Mortgagee shall not constitute a waiver
by the Mortgagee of any Event of Default with respect to which such advance
is made nor relieve the Mortgagor of any such Event of Default. The Mortgagor
shall pay to the Mortgagee upon demand all such advances made by the
Mortgagee with interest thereon at a rate equal to the Mortgagee's rate at
such time for short-term loans but in no event shall such rate be in excess
of the maximum rate permitted by applicable law. All such advances shall be
included in the obligations and secured by the security interest granted
hereunder.
SECTION 4.10. FURTHER ASSURANCES. Upon the request of any Mortgagee
hereunder, the Mortgagor shall promptly execute, acknowledge or deliver, or
cause to be executed, acknowledged or delivered to such Mortgagee supplements
here to and/or financing statements and other instruments and documents as
may be requested by such Mortgagee to protect and preserve the Mortgaged
Property, perfection of such Mortgagee's security interest therein and/or
such Mortgagee's rights and remedies hereunder.
SECTION 4.11. APPLICATION OF PROCEEDS FROM CONDEMNATION. In the
event that the Mortgaged Property or any part thereof, shall be taken under
the power of eminent domain, all proceeds and avails there from may be used
to finance construction of facilities secured or to be secured by this
Mortgage. Any proceeds not so used shall forthwith be applied by the
Mortgagor: first, to the ratable payment of any indebtedness secured by this
Mortgage other than principal of or interest on the Notes; second, to the
ratable payment of interest which shall have accrued on the Notes and be
unpaid; third, to the ratable payment of or on account of the unpaid
principal of the Notes, to such installments thereof as may be designated by
the respective Mortgagee at the time of any such payment.
SECTION 4.12. COMPLIANCE WITH LOAN AGREEMENTS; NOTICE OF AMENDMENTS
TO AND DEFAULTS UNDER LOAN AGREEMENTS. The Mortgagor will observe and perform
all of the covenants, agreements, terms and conditions contained in any Loan
Agreement entered into in connection with the issuance of any of the Notes,
as from time to time amended. The Mortgagor will send promptly to each
mortgagee notice of any default by the Mortgagor under any Loan Agreement and
notice of any amendment to any Loan Agreement.
SECTION 4.13. RIGHTS OF WAY, ETC. The Mortgagor will use its best
efforts to obtain all such rights of way, easements from landowners and
releases from lien holders as shall be necessary or advisable in the conduct
of its business, and, if requested by the Mortgagee, deliver to the Mortgagee
evidence satisfactory to it of the obtaining of such rights of way, easements
or releases.
10
ARTICLE V
REMEDIES OF THE MORTGAGEE
SECTION 5.01. EVENTS OF DEFAULT: Each of the following shall
be an Event of Default:
(a) default shall be made in the payment of any installment of
or on account of interest on or principal of (or premium, if any
associated with) any Note or Notes for more than five (5) Business Days
after the same shall be required to be made;
(b) default shall be made in the due observance or performance
of any other of the covenants, conditions or agreements on the part of
the Mortgagor, in any of the Notes, Loan Agreements or in this
Mortgage, and such default shall continue for a period of sixty (60)
days after written notice specifying such default and requiring the
same to be remedied shall have been given to the Mortgagor by the
Mortgagee;
(c) the Mortgagor shall file a petition in bankruptcy or be
adjudicated a bankrupt or insolvent, or shall make an assignment for
the benefit of its creditors, or shall consent to the appointment of a
receiver of itself or of its property, or shall institute proceedings
for its reorganization or proceedings instituted by others for its
reorganization shall not be dismissed within sixty (60) days after the
institution thereof;
(d) a receiver or liquidator of the Mortgagor or of any
substantial portion of its property shall be appointed and the order
appointing such receiver or liquidator shall not be vacated within
sixty (60) days after the entry thereof;
(e) the Mortgagor shall forfeit or otherwise be deprived
of its corporate charter or franchises, permits, easements, or
licenses required to carry on any material portion of its
business;
(f) a final judgment shall be entered against the Mortgagor
and shall remain unsatisfied or without a stay in respect thereof for a
period of sixty (60) days; or,
(g) any representation or warranty made by the Mortgagor
herein, in the Loan Agreements or in any certificate or financial
statement delivered hereunder or thereunder shall prove to be false or
misleading in any material respect.
SECTION 5.02. ACCELERATION OF MATURITY; RESCISSION AND
AMENDMENT.
(a) If an Event of Default described in Section 5.01(a) has
occurred and is continuing, any mortgagee upon which such default has
occurred may declare the principal of, and any other amounts due on
account of, all its Notes secured hereunder to be due and payable
immediately by a notice in writing to the Mortgagor and to all other
mortgagees (failure to provide said notice to all other mortgagees
shall not effect the validity of any acceleration of the Note or Notes
by such mortgagee), and upon such declaration, all unpaid
principal (premium, if any) and accrued interest so declared shall
become due and payable immediately, anything contained herein or in
any Note or Notes to the contrary notwithstanding. Upon receipt of
actual knowledge of or any notice of acceleration by any mortgagee,
any other mortgagee may declare the principal of all of its Notes to
be due and payable immediately by a notice in writing to the Mortgagor
and upon such declaration, all unpaid
11
principal (premium, if any) and accrued interest so declared shall
become due and payable immediately, anything contained herein or in
any Note or Notes to the contrary notwithstanding.
(b) If any other Event of Default shall have occurred and be
continuing, the Mortgagee may declare the principal (premium, if any)
and accrued interest on all Notes secured by this Mortgage due and
payable and upon such declaration, all unpaid principal (premium, if
any) and interest so declared shall become due and payable immediately,
anything contained herein or in any Note or Notes to the contrary
notwithstanding. Should the Mortgagee not take action to accelerate the
Notes within thirty (30) days after an Event of Default, any mortgagee
shall have the right to declare the principal (premium, if any) and
accrued interest on all Notes secured by this Mortgage due and payable
and upon such declaration, all unpaid principal (premium, if any) and
interest so declared shall become due and payable immediately, anything
contained herein or in any Note or Notes to the contrary
notwithstanding.
(c) If at any time after the unpaid principal of (premium, if
any) and accrued interest on any of the Notes shall have been so
declared to be due and payable, all payments in respect of principal
and interest which shall have become due and payable by the terms of
such Note or Notes (other than amounts due as a result of the
acceleration of the Notes) shall be paid to the respective mortgagee,
and all other defaults hereunder and under the Notes shall have been
made good and secured to the satisfaction of each of the mortgagees,
then and in every such case, a mortgagee who shall have declared the
principal of (premium, if any) and interest on Notes held by such
mortgagee to be due and payable may, by written notice to the
Mortgagor, annul such declaration and waive such default and the
consequences thereof, but no such waiver shall extend to or affect any
subsequent default or impair any right consequent thereon.
SECTION 5.03. REMEDIES OF MORTGAGEE. if one or more of the Events
of Default shall occur and be continuing, the Mortgagee personally or by
attorney, in its or their discretion, may, on behalf of all of the
noteholders, in so far as not prohibited by law:
(a) take immediate possession of the Mortgaged Property,
collect and receive all credits, outstanding accounts and bills
receivable of the Mortgagor and all rents, income, revenues and profits
pertaining to or arising from the Mortgaged Property, or any part
thereof, whether then past due or accruing thereafter, and issue
binding receipts therefor; and manage, control and operate the
Mortgaged Property as fully as the Mortgagor might do if in possession
thereof, including, without limitation, the making of all repairs or
replacements deemed necessary or advisable;
(b) proceed to protect and enforce the rights of the Mortgagee
and the rights of each mortgagee by suits or actions in equity or at
law in any court or courts of competent jurisdiction, whether for
specific performance of any covenant or any agreement contained herein
or in aid of the execution of any power herein granted or for the
foreclosure hereof or hereunder or for the sale of the Mortgaged
Property, or any part thereof, or to collect the debts hereby secured
or for the enforcement of such other or additional appropriate legal or
equitable remedies as may be deemed necessary or advisable
to protect and enforce the rights and remedies herein granted or
conferred, and in the event of the institution of any such action or
suit the mortgagee instituting such action or suit shall have the right
to have appointed a receiver of the Mortgaged Property and of all
rents, income, revenues and profits
12
pertaining thereto or arising therefrom, whether then past due or
accruing after the appointment of such receiver, derived, received or
had from the time of the commencement of such suit or action, and such
receiver shall have all the usual powers and duties of receivers in
like and similar cases, to the fullest extent permitted by law, and if
application shall be made for the appointment of a receiver the
Mortgagor hereby expressly consents that the court to which such
application shall be made may make said appointment; and
(c) sell or cause to be sold all and singular the Mortgaged
Property or any part thereof, and all right, title, interest, claim and
demand of the Mortgagor therein or thereto, at public auction at such
place in any county in which the property to be sold, or any part
thereof, is located, at such time and upon such terms as may be
specified in a notice of sale, which shall state the time when and the
place where the sale is to be held, shall contain a brief general
description of the property to be sold, and shall be given by mailing a
copy thereof to the Mortgagor at least fifteen (15) days prior to the
date fixed for such sale and by publishing the same once in each week
for two successive calendar weeks prior to the date of such sale in a
newspaper of general circulation published in said county or, if no
such newspaper is published in such county, in a newspaper of general
circulation in such county, the first such publication to be not less
than fifteen (15) days nor more than thirty (30) days prior to the date
fixed for such sale. Any sale to be made under this subparagraph (c) of
this Section 5.03 may be adjourned from time to time by announcement at
the time and place appointed for such sale or for such adjourned sale
or sales, and without further notice or publication the sale may be had
at the time and place to which the same shall be adjourned; PROVIDED,
HOWEVER, that in the event another or different notice of sale or
another or different manner of conducting the same shall be required by
law the notice of sale shall be given or the sale be conducted, as the
case may be, in accordance with the applicable provisions of law. The
expense incurred by such mortgagee (including, but not limited to,
receiver's fees, counsel fees, cost of advertisement and agents'
compensation) in the exercise of any of the remedies provided in this
Mortgage shall be secured by this Mortgage.
SECTION 5.04. APPLICATION OF PROCEEDS FROM REMEDIAL ACTIONS. Any
proceeds or funds arising from the exercise of any rights or the enforcement
of any remedies herein provided after the payment or provision for the
payment of any and all costs and expenses in connection with the exercise of
such rights or the enforcement of such remedies shall be applied first, to
the ratable payment of indebtedness hereby secured other than the principal
of or interest on the Notes; second, to the ratable payment of interest which
shall have accrued on the Notes and which shall be unpaid; third, to the
ratable payment of or on account of the unpaid principal of the Notes; and
the balance, if any, shall be paid to whosoever shall be entitled thereto.
SECTION 5.05. REMEDIES CUMULATIVE; NO ELECTION. Every right or
remedy herein conferred upon or reserved to the Mortgagee shall be cumulative
and shall be in addition to every other right and remedy given hereunder or
now or hereafter existing at law, or in equity, or by statute. The pursuit of
any right or remedy shall not be construed as an election.
SECTION 5.06. WAIVER OF APPRAISEMENT RIGHTS. The Mortgagor, for
itself and all who may claim through or under it, covenants that it will not
at any time insist upon or plead, or in any manner whatever claim, or take
the benefit or advantage of, any appraisement, valuation, stay, extension or
redemption laws now or hereafter in force in any locality where any of the
Mortgaged Property may be situated, in order to prevent, delay or hinder the
enforcement or foreclosure of this Mortgage, or the absolute sale of the
13
Mortgaged Property, or any part thereof, or the final and absolute putting
into possession thereof, immediately after such sale, of the purchaser or
purchasers thereat, and the Mortgagor, for itself and all who may claim
through or under it, hereby waives the benefit of all such laws unless such
waiver shall be forbidden by law.
SECTION 5.07. NOTICE OF DEFAULT. The Mortgagor covenants that it
will give immediate written notice to the Mortgagee of the occurrence of an
Event of Default or in the event that any right or remedy described in
Sections 5.02 and 5.03 hereof is exercised or enforced or any action i. taken
to exercise or enforce any such right or remedy.
ARTICLE VI
POSSESSION UNTIL DEFAULT-DEFEASANCE CLAUSE
SECTION 6.01. POSSESSION UNTIL DEFAULT. Until some one or more of
the Events of Default shall have happened, the Mortgagor shall be suffered
and permitted to retain actual possession of the Mortgaged Property, and to
manage, operate and use the same and any part thereof, with the rights and
franchises appertaining thereto, and to collect, receive, take, use and enjoy
the rents, revenues, issues, earnings, income, products and profits thereof
or therefrom, subject to the provisions of this Mortgage.
SECTION 6.02. DEFEASANCE. If the Mortgagor shall pay or cause to
be paid the whole amount of the principal of (premium, if any) and interest
on the Notes at the times and in the manner therein provided, and shall also
pay or cause to be paid all other sums payable by the Mortgagor hereunder or
under any applicable Loan Agreement and shall keep and perform, all covenants
herein required to be kept and performed by it, then and in that case, all
property, rights and interest hereby conveyed or assigned or pledged shall
revert to the Mortgagor and the estate, right, title and interest of the
Mortgagee shall thereupon cease, determine and become void and the Mortgagee,
in such case, on written demand of the Mortgagor but at the Mortgagor's cost
and expense, shall enter satisfaction of the Mortgage upon the record. In any
event, each mortgagee, upon payment in full to such mortgagee by the
Mortgagor of all Principal of (premium, if any) and interest on any Note held
by such mortgagee and the payment and discharge by the Mortgagor of all
charges due to such mortgagee hereunder or under any applicable Loan
Agreement, shall execute and deliver to the Mortgagor such instrument of
satisfaction, discharge or release as shall be required by law in the
circumstances.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. PROPERTY DEEMED REAL PROPERTY. It is hereby declared
to be the intention of the Mortgagor that any electric generating plant or
plants and facilities and all electric transmission and distribution lines,
or other electric or non- electric systems and facilities, embraced in the
Mortgaged Property, including, without limitation, all rights of way and
easements granted or given to the Mortgagor or obtained by it to use real
property in connection with the construction, operation or maintenance of
such plant, lines, facilities or systems, and all other property physically
attached to any of the foregoing, shall be deemed to be real property.
SECTION 7.02. MORTGAGE TO BIND AND BENEFIT SUCCESSORS AND ASSIGNS.
All of the covenants, stipulations, promises, undertakings and agreements
herein contained by or on behalf of the Mortgagor shall bind its successors
and assigns, whether so specified or not, and all titles, rights and remedies
hereby granted to or conferred upon the Mortgagee shall pass to and inure to
14
the benefit of the successors and assigns of the Mortgagee and shall be
deemed to be granted or conferred for the ratable,benefit and security of all
who shall from time to time be a mortgagee. The Mortgagor hereby agrees to
execute such consents, acknowledgements and other instruments as may be
reasonably requested by the Mortgagee in connection with the assignment,
transfer, mortgage, hypothecation or pledge of the rights or interests of the
Mortgagee hereunder or under the Notes or in and to any of the Mortgaged
Property.
SECTION 7.03. HEADINGS. The descriptive headings of the various
articles of this Mortgage were formulated and inserted for convenience only
and shall not be deemed to affect the meaning or construction of any of the
provisions hereof.
SECTION 7.04. NOTICES. All demands, notices, reports, approvals,
designations, or directions required or permitted to be given hereunder shall
be in writing and shall be deemed to be properly given if sent by registered
or certified mail, postage prepaid, or delivered by hand, or sent by
facsimile transmission, receipt confirmed, addressed to the proper party or
parties at the following address:
As to the Mortgagor: CAP ROCK ELECTRIC COOPERATIVE, INC.
000 Xxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
As to the Mortgagee: NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
Woodland Park
0000 Xxxxxxxxxxx Xxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attention: Governor
and as to any other person, firm, corporation or governmental body or agency
having an interest herein by reason of being a Mortgagee, at the last address
designated by such person, firm, corporation, governmental body or agency to
the Mortgagor and the Mortgagee. Any such party may from time to time
designate to each other a new address to which demands, notices, reports,
approvals, designations or directions may be addressed, and from and after
any such designation the address designated shall be deemed to be the address
of such party in lieu of the address given above.
SECTION 7.05. SEVERABILITY. The invalidity of any one or more
phrases, clauses, sentences, paragraphs or provisions of this Mortgage shall
not affect the remaining portions hereof, nor shall any invalidity as to any
mortgagee hereunder affect the rights hereunder of any other mortgagee.
SECTION 7.06 MORTGAGE DEEMED SECURITY AGREEMENT. To the extent that
any of the property described or referred to in this Mortgage is governed by
the provisions of the Uniform Commercial Code this Mortgage is hereby deemed
a "security agreement" under the Uniform Commercial Code, and a "financing
statement" under the Uniform Commercial Code for said security agreement. The
mailing addresses of the Mortgagor as debtor, and any mortgagee as secured
party are as set forth in Section 7.04 hereof.
SECTION 7.07. INDEMNIFICATION BY MORTGAGOR OF MORTGAGEE. The
Mortgagor agrees to indemnify and save harmless the Mortgagee against any
liability or damages which any of them may incur or sustain in the exercise
and performance of their rightful powers and duties hereunder. For such
reimbursement and indemnity, the Mortgagee shall be secured under this
Mortgage in the same manner as the Notes and all such reimbursements for
expense or damage shall be paid to the Mortgagee incurring or suffering the
same with interest at the rate specified in Section 4.09 hereof.
15
IN WITNESS WHEREOF, CAP ROCK ELECTRIC COOPERATIVE, INC., as
Mortgagor, has caused this Second Restated Mortgage and Security Agreement to
be signed in its name and its corporate seal to be hereunto affixed and
attested-by its officers thereunto duly authorized, and NATIONAL RURAL
UTILITIES COOPERATIVE FINANCE CORPORATION, as Mortgagee, has caused this
Second Restated Mortgage and Security Agreement to be signed in its name and
its corporate seal to be hereunto affixed and attested by its officers
thereunto duly authorized, all as of the day and year first above written.
CAP ROCK ELECTRIC COOPERATIVE, INC.
(SEAL)
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------
Xxxxxxx X. Xxxxx
Chairman of the Board
Attest: /s/ Xxxxxx X. Xxxxxxxx
------------------------------
Title:
------------------------------
Executed by the Mortgagor
in the presence of
/s/ ILLEGIBLE
-------------------------------------
/s/ ILLEGIBLE
-------------------------------------
Witnesses
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
By: /s/ ILLEGIBLE
----------------------------
for Governor
ATTEST: /s/ ILLEGIBLE
------------------------------
Title: Assistant Secretary Treasurer
------------------------------
Executed by the Mortgagee
in the presence of:
/s/ Xxxxxx Xxxxxxx
-------------------------------------
/s/ Xxx X. Xxxx
-------------------------------------
Witnesses
16
APPENDIX A
1. The Maximum Debt Limit is not applicable.
2. The Original Mortgage as described in the first WHEREAS clause above is
Restated Mortgage and Security Agreement dated as of March 30, 1993.
3. The outstanding secured indebtedness described in the second
WHEREAS clause above as evidenced by the Original Notes is as
follows:
======================================================================================================
Original
Note Designation Loan Agreement Principal Amount Maturity Date
======================================================================================================
Cap Rock Electric Cooperative, Inc.
------------------------------------------------------------------------------------------------------
9002 9/21/88 158,000 10/21/2009
------------------------------------------------------------------------------------------------------
9004 9/21/88 565,000 8/14/2010
------------------------------------------------------------------------------------------------------
9008 9/21/88 2,330,000 7/27/2013
------------------------------------------------------------------------------------------------------
9012 9/21/88 3,692,000 3/18/2017
------------------------------------------------------------------------------------------------------
9013 9/21/88 4,186,316 9/24/2020
------------------------------------------------------------------------------------------------------
9014 4/19/89 5,161,290 9/25/2022
------------------------------------------------------------------------------------------------------
9015 4/19/89 4,000,000 9/25/2022
------------------------------------------------------------------------------------------------------
9016 4/19/89 4,000,000 9/25/2022
------------------------------------------------------------------------------------------------------
9017 4/19/89 4,000,000 9/25/2022
------------------------------------------------------------------------------------------------------
9018 3/22/90 4,301,075 3/22/2025
------------------------------------------------------------------------------------------------------
9019 3/22/90 2,365,591 3/22/2025
------------------------------------------------------------------------------------------------------
9020 3/22/90 4,301,075 3/22/2025
------------------------------------------------------------------------------------------------------
9021 3/22/90 3,763,441 3/22/2025
------------------------------------------------------------------------------------------------------
9022 3/22/90 3,225,806 3/22/2025
------------------------------------------------------------------------------------------------------
9024 3/10/92 846,411 3/10/2027
------------------------------------------------------------------------------------------------------
9025 3/10/92 846,411 3/10/2027
------------------------------------------------------------------------------------------------------
9026 3/10/92 846,411 3/10/2027
------------------------------------------------------------------------------------------------------
9027 3/10/92 846,411 3/10/2027
------------------------------------------------------------------------------------------------------
Lone Wolf Electric Cooperative, Inc.
------------------------------------------------------------------------------------------------------
9028 3/30/93 10,000 2/17/2007
------------------------------------------------------------------------------------------------------
9030 3/30/93 146,000 10/16/2014
------------------------------------------------------------------------------------------------------
9031 3/30/93 641,000 6/4/2016
------------------------------------------------------------------------------------------------------
9034 3/30/93 4,268,617 3/30/2028
------------------------------------------------------------------------------------------------------
9035 3/30/93 4,268,617 3/30/2028
------------------------------------------------------------------------------------------------------
9036 3/30/93 4,268,617 3/30/2028
------------------------------------------------------------------------------------------------------
9037 3/30/93 4,268,617 3/30/2028
------------------------------------------------------------------------------------------------------
9039 12/13/94 5,072,000 12/13/2029
------------------------------------------------------------------------------------------------------
9040 12/13/94 5,072,000 12/13/2029
------------------------------------------------------------------------------------------------------
9041 12/13/94 5,072,000 12/13/2029
------------------------------------------------------------------------------------------------------
9043 10/24/95 15,000,000 10/24/2005
------------------------------------------------------------------------------------------------------
======================================================================================================
Original
Note Designation Loan Agreement Principal Amount Maturity Date
======================================================================================================
ns Cooperative
------------------------------------------------------------------------------------------------------
10-49-044-C-9005 2/21/86 $743,617 4/23/2021
------------------------------------------------------------------------------------------------------
APPENDIX B - - PROPERTY SCHEDULE
(a) The counties referred to in Section 2.01 are Andrews, Borden,
Collin, Dawson, Ector, Fannin, Fisher, Glasscock, Howard,
Hunt, Irion, Martin, Midland, Mitchell, Nolan, Reagan, Scurry,
Sterling, Xxx Xxxxx and Xxxxx in the state of Texas.
(b) The property referred to in the Granting clause includes the
following:
SEE ATTACHED
APPENDIX C - - EXCEPTED PROPERTY
NOT APPLICABLE
STATE OF TEXAS )
-------------
COUNTY OF MIDLAND )
------------
On this 24TH day of OCTOBER , 1995, before me appeared XXXXXX X.
XXXXX and XXXXXX X. personally known, by me and having been duly sworn by me
did say that they are the Chairman of the Board and Secretary, respectively,
of Cap Rock Electric Cooperative, Inc., a Texas corporation, and that the
seal affixed to the foregoing instrument is the corporate seal of said
corporation, and that said instrument was signed and sealed in behalf of said
corporation by authority of its Board of Directors, and said X.X. XXXXXXXXX
and X.X. XXXX acknowledged that the execution of said instrument was a free
act and deed of said corporation.
IN WITNESS whereof, I have hereunto set my hand and official seal the
day and year last above written.
---------------------------------
XXXXXX X. XXXX /s/ Xxxxxx X. Xxxx
[SEAL] NOTARY PUBLIC ---------------------------
STATE OF TEXAS Notary Public
Commission Expires 3-29-97
---------------------------------
My commission expires:
COMMONWEALTH OF VIRGINIA ) SS
BEFORE ME, a Notary Public, in and for the Commonwealth of Virginia,
appeared in person G.V. BEER , signing for the Governor of the National Rural
Utilities Cooperative Finance Corporation, to me personally known, and known to
be the identical person who subscribed the name of said corporation to the
foregoing instrument, being by me duly sworn, and who stated that she/he is duly
authorized to execute the foregoing instrument on behalf of said corporation,
and further stated and acknowledged that she/he executed the foregoing
instrument as a free and voluntary act and deed of said corporation for the
consideration therein mentioned and set forth.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal
this 20TH day of OCTOBER , 1995.
/s/ Xxxxx Xxxxxxxxx
---------------------------
Notary Public
(Notarial Seal)
My Commission expires:
January 31, 1998
SECOND DEED OF TRUST ADDENDUM
TO
MORTGAGE AND SECURITY AGREEMENT
This Second Deed of Trust Addendum to Mortgage and Security Agreement
(referred to herein as the "Deed of Trust") is attached to and is made a part
of the Second Mortgage and Security Agreement dated as of the 7 day of
October, 1995 (the "Mortgage") made by and between CAP ROCK ELECTRIC
COOPERATIVE, INC. (referred to in the Mortgage as the "Mortgagor") and
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORPORATION (referred to in the
Mortgage as the. "Mortgagee").
The purpose of this Deed of Trust is to grant to Mortgagee, in
addition to the liens contained in the Mortgage, a deed of trust lien in and
to the real property, improvements, fixtures, appurtenances and other
properties which make up the Mortgaged Property (as that term is defined in
the Mortgage, but as modified pursuant to Section 1 below). The liens granted
in this Deed of Trust shall be in addition to, and not in lieu of, the liens
and security interests granted in the Mortgage.
For purposes of the liens granted as set forth below, in addition to
any defined terms set forth in the Mortgage (which defined terms shall have
the same meanings when used herein) or elsewhere in this Deed of Trust, the
following definitions shall apply:
Grantor: Cap Rock Electric Cooperative, Inc.
000 Xxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Beneficiary: National Rural Utilities Cooperative Finance Corporation
Woodland Park
0000 Xxxxxxxxxxx Xxx
Xxxxxxx, XX 00000-0000
Trustee: Xxxxxx X. Xxxxxx
For good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged and confessed, the undersigned parties do hereby agree as
follows:
SECTION 1. MORTGAGED PROPERTY. The Mortgaged Property shall include, in
addition to the properties described in the Mortgage, the properties as
described in Schedule 1 hereto.
SECTION 2. CONVEYANCE IN TRUST. Grantor hereby conveys the Mortgaged
Property to Trustee in trust, with power of sale, TO HAVE AND TO HOLD the
Mortgaged Property, together with the rights, privileges, and appurtenances
thereto belonging, unto Trustee and Trustee's substitutes or successors
forever. Grantor binds itself and its legal representatives, successors and
assigns to WARRANT AND FOREVER DEFEND the Mortgaged Property unto the
Trustee, and the Trustee's substitutes or successors and assigns, against the
claim or claims of all persons claiming or to claim the same or any part
thereof.
SECTION 3. INDEBTEDNESS SECURED. The liens granted in this Deed of Trust
shall secure the payment of the principal of and interest on the CFC Notes,
according to their terms, and further to secure the due performance of
covenants, agreements and provisions contained in the Mortgage and this Deed
of Trust, and the CFC Loan Agreements (hereinafter referred to as the
"Indebtedness").
1
SECTION 4. REMEDIES UPON EVENTS OF DEFAULT. Upon the occurrence of any
of the Events of Default, Beneficiary may proceed with foreclosure and
enforce its rights and remedies under the following terms and conditions:
(a) NOTICE OF SALE - Notice of sale of all or part of the Mortgaged
Property by the Trustee shall be given by posting written notice thereof at
the courthouse door (or other area in the courthouse as may be designated for
such public notices) of the county in which the sale is to be made, and by
filing a copy of the notice in the office of the county clerk of the county
in which the sale is to be made, at least twenty-one (21) days preceding the
date of the sale, and if the Mortgaged Property to be sold is in more than
one county a notice shall be posted at the courthouse door (or other area in
the courthouse as may be designated for such public notices) and filed with
the county clerk of each county in which the Mortgaged Property to be sold is
situated. In addition, Beneficiary shall, at least twenty-one (21) days
preceding the date of sale, serve written notice of the proposed sale by
certified mail on Grantor and each debtor obligated to pay the Indebtedness
secured hereby according to the records of Beneficiary. Service of such
notice shall be completed upon deposit of the notice, enclosed in a postpaid
wrapper, properly addressed to such debt?or at the most recent address as
shown by the records of Beneficiary, in a post office or official depository
under the care and custody of the United States Postal Service. The affidavit
of any person having knowledge of the facts to the effect that such service
was completed shall be prima facie evidence of the fact of service. Any
notice that is required or permitted to be given to Grantor may be addressed
to Grantor at Grantor's address as stated in this Deed of Trust. Any notice
that is to be given by certified mail to any other debtor may, if no address
for such other debtor is shown by the records of Beneficiary, be addressed to
such other debtor at the address of Grantor as is shown by the records of
Beneficiary. Notwithstanding the foregoing provisions of this Section, notice
of such sale given in accordance with the requirements of the applicable laws
of the State of Texas in effect at the time of such sale shall constitute
sufficient notice of such sale.
(b) TRUSTEE'S SALE - Beneficiary may require the Trustee to sell all or
part of the Mortgaged Property, at public auction, to the highest bidder, for
cash, at the county courthouse of the county in Texas in which the Mortgaged
Property is located and if the Mortgaged Property is located in more than one
county such sale or sales may be made at the courthouse in any county in
which the Mortgaged Property is situated. All sales shall take place at such
area of the courthouse as shall be properly designated from time to time by
the commissioners court (or, if not so designated by the commissioners court,
at such other area in the courthouse as may be provided in the notice of sale
hereinafter described) of the specified county, between the hours of 10:00
o'clock a.m. and 4:00 o'clock p.m. (the commencement of such sale to occur
within three hours following the time designated in the above described
notice of sale as the earliest time at which such sale shall occur, if
required by applicable law) on the first Tuesday of any month, after giving
notice of the time, place and terms of said sale (including the earliest time
at which such sale shall occur) and of the Mortgaged Property to be sold in
the manner hereinafter described. Trustee may sell all or any port ion of the
Mortgaged Property, together or in lots or parcels. Beneficiary may bid and
become the purchaser of all or any part of the Mortgaged Property at any
trustee's or foreclosure sale hereunder, and the amount of Beneficiary's
successful bid may be credited on the Indebtedness.
(c) PARTIAL SALES - The sale by Trustee of less than the whole of the
Mortgaged Property shall not exhaust the power of sale herein granted, and
Trustee is specifically empowered to make successive sales under such power
until the whole of the Mortgaged Property shall be sold; and if the proceeds
of such sale of less than the whole of the Mortgaged Property shall be less
than the aggregate of Indebtedness and expenses thereof, this Deed of Trust
and the lien, security interest and assignment hereof shall remain in full
force and effect as to the unsold portion of the Mortgaged Property just as
though no sale had been
2
made; provided, however, that Grantor shall never have any right to require
the sale of less than the whole of the Mortgaged Property, but Beneficiary
shall have the right, at its sole election, to request Trustee to sell less
than the whole of the Mortgaged Property. If there is a default on the
payment of any installment on any Portion of the Indebtedness, and
Beneficiary elects not to accelerate the unpaid balance of the Note
or~Indebtedness, Beneficiary shall have the option to proceed with
foreclosure in satisfaction of such unpaid installment or other amount either
through judicial proceedings or by directing Trustee to proceed as if under a
full foreclosure, conducting the sale as herein provided without declaring
the entire Indebtedness due. It is agreed that such sale, if so made, shall
not in any manner affect the unmatured part of the Indebtedness, but as to
such unmatured part this Deed of Trust shall remain in full force and effect
as though no-sale had been made under the provisions of this Section. Several
sales may be made hereunder without exhausting the right of sale for any
unmatured part of the Indebtedness.
(d) FORECLOSURE OF ALL MORTGAGED PROPERTY - The Mortgaged Property may
be sold in one or more public sales pursuant to Texas Property Code Section
51.002 and Texas UCC Section 9.504(d). Grantor and all persons obligated to
pay the Indebtedness agree that notice of sale of the Mortgaged Property
provided pursuant to paragraph (a) above and pursuant to Texas Property Code
Section 51.002 is and shall constitute commercially reasonable notice of the
Mortgaged Property or any part of the Mortgaged Property. Beneficiary shall
also be entitled to foreclose its security interests against any personal
property in accordance with any other rights and remedies Beneficiary may
have as a secured party under the Texas UCC.
(e) TRUSTEE'S DEED - Trustee shall deliver to the purchaser a Trustee's
deed and such other assignments and documents of transfer and sale as Trustee
may deem necessary conveying the Mortgaged Property so sold in fee simple
with covenants of general warranty. Grantor covenants and agrees to defend
generally the purchaser's title to the Mortgaged Property against all claims
and demands.
(f) PROCEEDS OF SALE - Trustee shall apply the proceeds of the sale in
the following order: (a) to all reasonable costs and expenses of the sale,
including but not limited to, reasonable Trustee's fees and attorney's fees
and costs of title evidence; (b) to all sums secured by this Deed of Trust in
such order as Beneficiary, in Beneficiary's sole discretion, directs; and (c)
the excess, if any, to the person or persons legally entitled thereto.
(g) POSSESSION AFTER SALE - If the Mortgaged Property is sold pursuant
to paragraph (b), Grantor or any person holding possession of the Mortgaged
Property through the Grantor shall immediately surrender possession of the
Mortgaged Property to the purchaser at such sale upon the purchaser's written
demand. If possession is no surrendered upon the purchaser's written demand,
Grantor or such person shall be a tenant at sufferance and may be removed by
writ of possession or by an action for forcible entry and detainer.
(h) COSTS AND EXPENSES - Beneficiary shall be entitled to collect all
costs and expenses incurred in pursuing such remedies, including but not
limited to, attorney's fees and costs of documentary evidence, abstracts and
title reports.
(i) SUBSTITUTE TRUSTEE - Beneficiary, at Beneficiary's option, with or
without cause, may from time to time remove Trustee and appoint a successor
trustee to any Trustee appointed hereunder without other formality than a
designation in writing. Without conveyance of the Mortgaged Property, the
successor trustee shall succeed to all title, power, and duties conferred
upon the Trustee by this Deed of Trust and by applicable law.
(j) REMEDIES CUMULATIVE - Each remedy provided in this Deed of Trust is
distinct and cumulative to all other rights or remedies under this Deed of
Trust or afforded by law or equity, and may be exercised concurrently,
independently, or successively, in any order whatsoever.
(k) SCHEDULE 1. Schedule 1 attached hereto is an integral part of this
Deed of Trust and is incorporated herein by reference.
3
IN WITNESS WHEREOF, CAP ROCK ELECTRIC COOPERATIVE, INC., as
Mortgagor/Grantor, has caused this Deed of Trust to be signed and its
corporate seal to be hereunto affixed and attested by its officers thereunto
duly authorized, and NATIONAL RURAL UTILITIES COOPERATIVE FINANCE
CORPORATION, as Mortgagee/Beneficiary, has caused this Deed of Trust to be
signed in its name and its corporate seal to be hereunto affixed and attested
by its officers thereunto duly authorized, all as of the day and year first
above written.
CAP ROCK ELECTRIC COOPERATIVE, INC.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Xxxxxxx X Xxxxx
Chairman of the Board
(SEAL)
Attest: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------
Secretary
Executed by the Mortgagor/Grantor
in the presences of:
/s/ ILLEGIBLE
-------------------------------------
/s/ ILLEGIBLE
-------------------------------------
Witnesses
NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION
By: /s/ ILLEGIBLE
--------------------------------
for Governor
[SEAL]
Attest: /s/ ILLEGIBLE
------------------------------
Assistant Secretary-Treasurer
Executed by the Mortgagee/Beneficiary
in the presences of:
/s/ Xxxxxx Xxxxxxx
-------------------------------------
/s/ Xxx X. Xxxx
-------------------------------------
Witnesses
4
STATE OF TEXAS )
) SS
COUNTY OF Midland )
On this 24TH day of OCTOBER, 1995, before me appeared Xxxxxxx X. Xxxxx, who
did say that he signed as the Chairman of the Board of CAP ROCK ELECTRIC
COOPERATIVE, INC., a corporation, and that the seal affixed to the foregoing
instrument is the corporate seal of said corporation, and that said
instrument was signed and sealed on behalf of said corporation by authority
of a duly adopted resolution of its board of directors, and he acknowledged
to me that said corporation executed the same.
IN WITNESS WHEREOF I have heretofore set my and official seal the day
and year last above written.
--------------------------- /s/ XXXXXX X. XXXX
XXXXXX X. XXXX ------------------------------
NOTARY PUBLIC Notary Public
STATE OF TEXAS
Commission Expires 3-29-97
---------------------------
(Notarial Seal)
My commission expires:
COMMONWEALTH OF VIRGINIA )
) SS
COUNTY OF FAIRFAX )
On this 20TH day of OCTOBER , 1995, before me appeared G.V. BEER ,who did say
that the undersigned for the Governor of NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION, a corporation, and that the seal affixed to the
foregoing instrument is the corporate seal of said corporation, and that said
instrument was signed and sealed on behalf of said corporation by authority
of a duly adopted resolution of its board of directors, and HE acknowledged
to me that said corporation executed the same.
IN WITNESS WHEREOF I have heretofore set my and official seal the day
and year last above written.
/s/ Xxxxx Xxxxxxxxx
------------------------------
Notary Public
(Notarial Seal)
My commission expires: January 31, 1998
SCHEDULE 1
NOT APPLICABLE
