FIRST AMENDMENT TO
CREDIT AGREEMENT
By and Among
NEW JERSEY RESOURCES CORPORATION
as the Borrower
THE FINANCIAL INSTITUTIONS PARTY THERETO
as the Lenders
and
PNC BANK, NATIONAL ASSOCIATION
as the Administrative Agent
and
FLEET NATIONAL BANK
as the Syndication Agent
and
BANK ONE, NA
as the Documentation Agent
Dated as of
October 3, 2001
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (the "First Amendment")
made as of October 3, 2001, among NEW JERSEY RESOURCES CORPORATION, a New Jersey
corporation (the "Borrower"), the financial institutions listed on the signature
pages hereto (each individually a "Lender" and collectively the "Lenders"), PNC
BANK, NATIONAL ASSOCIATION, a national banking association, as Administrative
Agent for the Lenders (in such capacity the "Administrative Agent"), FLEET
NATIONAL BANK (as successor to SUMMIT BANK), as Syndication Agent and BANK ONE,
NA, a national banking association, as Documentation Agent, amends that certain
Credit Agreement dated as of January 5, 2001 by and among the Borrower, the
financial institutions listed on the signature pages thereto (the "Existing
Lenders") and the Administrative Agent (the Credit Agreement, together with the
exhibits and schedules thereto and all modifications, amendments, extensions,
renewals, substitutions or replacements prior to the date hereof, the "Existing
Agreement") (the Existing Agreement, as amended by this First Amendment and as
modified, amended, extended, renewed, substituted or replaced from time to time
hereafter, the "Agreement").
WITNESSETH:
WHEREAS, the Borrower, the Lenders and the Administrative Agent
entered into the Existing Agreement pursuant to which the Lenders made certain
financial accommodations available to the Borrower including Commitments to make
Revolving Credit Loans in an amount not to exceed $135,000,000; and
WHEREAS, the Borrower, the Lenders and the Administrative Agent
desire to amend the Existing Agreement as set forth herein.
NOW THEREFORE, in consideration of the mutual promises contained
herein and other good and valuable consideration, the Borrower, the
Administrative Agent and the Lenders with the intent to be legally bound hereby,
agree that the Existing Agreement shall be amended as follows:
ARTICLE I
AMENDMENTS TO EXISTING AGREEMENT
SECTION 1.01. ADDITIONAL DEFINITIONS. Section 1.1 of the
Existing Agreement is hereby amended by adding thereto the following definitions
in the appropriate alphabetical order:
"First Amendment" shall mean that certain First Amendment to
Credit Agreement dated as of October 3, 2001.
"First Amendment Effective Date" shall mean October 3, 2001.
"Gas Cost Underrecovery Adjustment Assets" means that
Underrecovered Gas Cost Balance to be collected from all sales customers
and transportation customers,
through surcharge commencing December 1, 2001 over an amortization
period of three years from that date, with simple interest at 5.5% per
annum, until November 30, 2004.
"Permitted Accounts Receivable Securitization" means the
receivables financing program providing for the sale of Receivables
Facility Assets by Borrower and its Subsidiaries to the Receivables
Subsidiary in transactions purporting to be sales (and treated as sales
for GAAP purposes), which Receivables Subsidiary shall finance the
purchase of such Receivables Facility Assets by the sale, transfer,
conveyance, lien or pledge of such Receivables Facility Assets to one or
more limited purpose financing companies, special purpose entities
and/or other financial institutions, in each case, on a limited recourse
basis as to the Borrower and its Subsidiaries; provided that any such
transaction described herein shall be consummated pursuant to
documentation in form and substance reasonably satisfactory to the
Agent.
"Receivables Documents" shall mean all documentation relating to
any Permitted Accounts Receivable Securitization.
"Receivables Facility Assets" shall mean all Gas Cost
Underrecovery Adjustment Assets of Borrower and its Subsidiaries which
are transferred to the Receivables Subsidiary pursuant to a Permitted
Accounts Receivable Securitization, and any assets related thereto,
including without limitation (i) all collateral given by the respective
account debtor or on its behalf (but not by Borrower or any of its
Subsidiaries) securing such Gas Cost Underrecovery Adjustment Assets,
(ii) all contracts and all guarantees (but not by Borrower or any of its
Subsidiaries) or other obligations directly related to such Gas Cost
Underrecovery Adjustment Assets, (iii) other related assets including
those set forth in the Receivables Documents, and (iv) proceeds of all
of the foregoing.
"Receivables Facility Attributed Indebtedness" at any time shall
mean the aggregate net outstanding amount theretofore paid to the
Receivables Subsidiary in respect of the Receivables Facilities Assets
sold, transferred, financed or pledged by it in connection with a
Permitted Accounts Receivable Securitization (it being the intent of the
parties that the amount of Receivables Facility Attributed Indebtedness
at any time outstanding approximate as closely as possible the principal
amount of Indebtedness which would be outstanding at such time under the
Permitted Accounts Receivable Securitization if the same were structured
as a secured lending agreement rather than a purchase agreement).
"Receivables Subsidiary" means a special purpose, bankruptcy
remote wholly-owned Subsidiary of Borrower which may be formed for the
sole and exclusive purpose of engaging in activities in connection with
the purchase, sale and financing of Gas Cost Underrecovery Adjustment
Assets in connection with and pursuant to a Permitted Accounts
Receivable Securitization.
"Underrecovered Gas Cost Balance" means that amount of New
Jersey Natural Gas Company's Levelized Gas Adjustment Clause not
recovered in customer rates for the period ending October 31, 2001.
SECTION 1.02. AMENDMENTS TO CERTAIN DEFINITIONS. The
definition of the term "Permitted Encumbrance" contained in Section 1.1 of the
Existing Agreement is hereby
-2-
amended by adding to the end thereof the following new clauses (x) and (xi)
which shall read as follows:
"(x) Encumbrances on Receivables Facility Assets transferred
(a) to the Receivables Subsidiary or (b) by the Receivables Subsidiary
to the purchasers of such receivables (and the filing of financing
statements in connection therewith) created by, and as set forth in, the
Receivables Documents pursuant to the Permitted Accounts Receivable
Securitization; and
(xi) Encumbrances on meter assets created in connection with
capitalized lease transactions and securing Indebtedness in favor of one
or more financial institutions incurred in connection with such
transactions in an aggregate principal amount not to exceed
$27,000,000."
SECTION 1.03. Amendment to Section 5.2 of the Existing
Agreement. Section 5.2 of the Existing Agreement is hereby amended and restated
to read as follows:
"5.2 Encumbrances. The Borrower will not create or
suffer to exist, or permit any of its Subsidiaries to create or suffer
to exist, any Encumbrance or any other type of preferential arrangement,
upon or with respect to any of its properties, whether now owned or
hereafter acquired, or assign, or permit any of its Subsidiaries to
assign, any right to receive income, in each case to secure or provide
for the payment of any Indebtedness of any Person, other than:
(a) purchase money liens or purchase money security
interests upon or in any property acquired or
held by the Borrower or any Subsidiary in the
ordinary course of business to secure the
purchase price of such property or to secure
indebtedness incurred solely for the purpose of
financing the acquisition of such property, so
long as such indebtedness does not exceed 100%
of the purchase price of such property;
(b) Encumbrances existing on such property at the
time of the acquisition of such property or the
acquisition of such Subsidiary (other than any
such Encumbrance created as a result of such
acquisition);
(c) Permitted Encumbrances;
(d) Extensions or renewals of any Encumbrance
described in clauses (a) through (c) above,
provided, that (i) any such extension or renewal
shall be limited to the property theretofore
subject to such Encumbrance and (ii) the
principal amount of the Indebtedness secured by
such Encumbrance shall not be increased; or
(e) Encumbrances permitted pursuant to Section 5.2
of that certain Credit Agreement by and among
New Jersey Natural Gas Company as Borrower, the
financial
-3-
institutions party thereto as the Lenders, PNC
Bank, National Association as the Administrative
Agent, Fleet National Bank (as successor to
Summit Bank) as Syndication Agent, Bank One, NA
as the Documentation Agent and PNC Capital
Markets and Fleet National Bank (as successor to
Summit Bank) as the Co-Lead Arrangers.
provided, that the aggregate principal amount of Indebtedness
secured by Encumbrances referred to in clauses (a) and (b) above
shall not exceed $5,000,000 at any time outstanding (it being
expressly agreed that any refinanced Indebtedness shall not be
considered new Indebtedness hereunder)."
SECTION 1.04. AMENDMENT TO SECTION 5.3 OF THE EXISTING
AGREEMENT. Section 5.3 of the Existing Agreement is hereby amended and restated
to read as follows:
"5.3 INDEBTEDNESS. The Borrower shall not and shall
not permit any Subsidiary to create, incur, assume, cause,
permit or suffer to exist or remain outstanding any Indebtedness
except for:
(i) The Bank Indebtedness;
(ii) Existing Indebtedness set forth on
Schedule 5.3 hereof and any extensions, renewals or refinancings
thereof in outstanding principal amounts not greater than those
shown on Schedule 5.3; provided that such extensions, renewals
or refinancings when incurred and when added to the Borrower's
then outstanding Indebtedness would not cause the Borrower to be
in violation of Section 5.2 hereof;
(iii) Additional Indebtedness under the
Mortgage Indenture as permitted pursuant to the terms of the
Mortgage Indenture in the form in effect on the Closing Date;
(iv) Additional Indebtedness in favor of one
or more financial institutions in connection with capitalized
leases of meter assets in an aggregate principal amount not to
exceed $27,000,000 at any one time outstanding;
(v) Receivables Facility Attributed
Indebtedness;
(vi) Indebtedness permitted pursuant to
Section 5.3 of that certain Credit Agreement by and among New
Jersey Natural Gas Company as Borrower, the financial
institutions party thereto as the Lenders, PNC Bank, National
Association as the Administrative Agent, Fleet National Bank (as
successor to Summit Bank) as Syndication Agent, Bank One, NA as
the Documentation Agent and PNC Capital Markets and Fleet
National Bank (as successor to Summit Bank) as the Co-Lead
Arrangers; and
-4-
(vii) Additional Indebtedness not otherwise
permitted by the foregoing clauses (i), (ii), (iii), (iv), (v)
or (vi) in an aggregate principal amount not to exceed
$25,000,000 at any one time outstanding.
In addition, Indebtedness incurred pursuant to item (vii) may
not contain covenants (other than covenants relating to
collateral, if any, securing such Indebtedness as such security
interests are permitted hereby) more restrictive than or in
addition to those contained herein."
SECTION 1.05. AMENDMENT TO SECTION 5.5 OF THE EXISTING
AGREEMENT. Section 5.5 of the Existing Agreement is hereby amended to add the
following language to the end thereof:
", except for investments in the Receivables Subsidiary prior to
the occurrence and continuance of any Potential Default or Event of
Default."
SECTION 1.06. AMENDMENT TO SECTION 5.6 OF THE EXISTING
AGREEMENT. Section 5.6 of the Existing Agreement is hereby amended to add the
following language to the end thereof:
", and other than (i) a sale, contribution or other transfer of
Receivables Facility Assets to the Receivables Subsidiary and the
Receivables Subsidiary may sell and make other transfers of Receivables
Facility assets, in each case pursuant to the Receivables Documents in
connection with the Permitted Accounts Receivable Securitization" and
(ii) in connection with the capitalized lease transactions permitted
under Section 5.3(iv)."
SECTION 1.07. NO OTHER AMENDMENTS OR WAIVERS. The amendments
to the Existing Agreement set forth in Sections 1.01 through 1.05 above do not
either implicitly or explicitly alter, waive or amend, except as expressly
provided in this First Amendment, the provisions of the Existing Agreement. The
amendments set forth in Sections 1.01 through 1.05 hereof do not waive, now or
in the future, compliance with any other covenant, term or condition to be
performed or complied with nor do they impair any rights or remedies of the
Lenders or the and the Administrative Agent under the Existing Agreement with
respect to any such violation. Nothing in this First Amendment shall be deemed
or construed to be a waiver or release of, or a limitation upon, the Lenders' or
the Administrative Agent's exercise of any of their respective rights and
remedies under the Existing Agreement and the other Loan Documents, whether
arising as a consequence of any Events of Default which may now exist or
otherwise, and all such rights and remedies are hereby expressly reserved.
ARTICLE II
BORROWER'S SUPPLEMENTAL REPRESENTATIONS
SECTION 2.01. INCORPORATION BY REFERENCE. As an inducement to
the Lenders to enter into this First Amendment, the Borrower hereby repeats
herein, for the benefit of the Lenders, the representations and warranties made
by the Borrower in Article III of the Existing Agreement, as amended hereby,
except that for purposes hereof such representations and warranties shall be
deemed to extend to and cover this First Amendment.
-5-
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.01. CONDITIONS PRECEDENT. Each of the following
shall be a condition precedent to the effectiveness of this First Amendment:
(i) The Administrative Agent shall have received on behalf
of each Lender, on or before the First Amendment Effective Date, duly executed
counterpart originals of this First Amendment (which may be initially delivered
via telecopier).
(ii) The following statements shall be true and correct on
the First Amendment Effective Date, and the Administrative Agent shall have
received a certificate signed by an authorized officer of the Borrower dated the
First Amendment Effective Date stating that:
(A) except to the extent modified in writing by the
Borrower heretofore delivered to the Banks, the representations and warranties
made pursuant to Section 3.01 of this First Amendment and in the other Loan
Documents are true and correct on and as of the First Amendment Effective Date
as though made on and as of such date in all material respects;
(B) no Event of Default or Potential Default has
occurred and is continuing, or would result from the execution of or performance
under this First Amendment;
(C) the Borrower has in all material respects
performed all agreements, covenants and conditions required to be performed on
or prior to the date hereof under the Existing Agreement and the other Loan
Documents.
(iii) The Administrative Agent shall have received a
certificate, duly certified as of the date hereof, by the secretary or assistant
secretary of the Borrower, as to (A) the Certificate of Incorporation of the
Borrower in effect as of the date hereof, (B) the By-Laws of the Borrower in
effect as of the date hereof, (C) the resolutions of the Borrower's Board of
Directors authorizing the borrowings hereunder and the execution and delivery of
this First Amendment, and all documents supplemental hereto and (D) the names of
the officers of the Borrower authorized to sign this First Amendment and all
supplemental documentation and which contains a true signature of each such
officer.
(iv) The Borrower shall pay to the Administrative Agent for
the account of each Lender who executes this First Amendment on or before the
First Amendment Effective Date a fee equal to one (1) basis point (.01%) of such
Lender's aggregate Commitment.
-6-
ARTICLE IV
GENERAL PROVISIONS
SECTION 4.01. RATIFICATION OF TERMS. Except as expressly
amended by this First Amendment, the Existing Agreement and each and every
representation, warranty, covenant, term and condition contained therein is
specifically ratified and confirmed in all material respects.
SECTION 4.02. REFERENCES. All notices, communications,
agreements, certificates, documents or other instruments executed and delivered
after the execution and delivery of this First Amendment in connection with the
Agreement, any of the other Loan Documents or the transactions contemplated
thereby may refer to the Existing Agreement without making specific reference to
this First Amendment, but nevertheless all such references shall include this
First Amendment unless the context requires otherwise. From and after the First
Amendment Effective Date, all references in the Existing Agreement and each of
the other Loan Documents to the "Agreement" shall be deemed to be references to
the Existing Agreement as amended hereby.
SECTION 4.03. COUNTERPARTS. This First Amendment may be
executed in different counterparts, each of which when executed by the Borrower,
the Administrative Agent and the Lenders shall be regarded as an original, and
all such counterparts shall constitute one First Amendment. Delivery of an
executed counterpart by telecopier shall be effective as delivery of a manually
executed counterpart hereof.
SECTION 4.04. CAPITALIZED TERMS. Except for proper nouns and
as otherwise defined herein, capitalized terms used herein as defined terms
shall have the meanings ascribed to them in the Existing Agreement, as amended
hereby.
SECTION 4.05. GOVERNING LAW. THIS FIRST AMENDMENT AND THE
RIGHTS AND OBLIGATIONS HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW JERSEY WITHOUT REGARD TO THE PROVISIONS
THEREOF REGARDING CONFLICTS OF LAW.
SECTION 4.06. HEADINGS. The headings of the sections in this
First Amendment are for purposes of reference only and shall not be deemed to be
a part hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-7-
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound
hereby, have caused this First Amendment to Credit Agreement to be duly executed
by their duly authorized officers as of the date first written above.
ATTEST: NEW JERSEY RESOURCES CORPORATION
By: By: (SEAL)
----------------------------- ------------------------------
Name: Name:
--------------------------- ----------------------------------
Title: Title:
-------------------------- ---------------------------------
PNC BANK, NATIONAL ASSOCIATION, in its
capacity as the Administrative Agent
hereunder
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
PNC BANK, NATIONAL ASSOCIATION, as a
Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
FLEET NATIONAL BANK, as a Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
BANK ONE, N.A., as a Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
[REMAINDER OF SIGNATURES CONTINUED OF FOLLOWING PAGE]
[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
THE BANK OF NEW YORK, as a Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
CITIZENS BANK OF MASSACHUSETTS, as a
Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
BANK OF TOKYO-MITSUBISHI TRUST COMPANY,
as a Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
THE CHASE MANHATTAN BANK, as a Lender
By: (SEAL)
------------------------------
Name:
----------------------------------
Title:
---------------------------------
