FIRST AMENDMENT TO AMENDED AND RESTATED LETTER OF CREDIT
AND REIMBURSEMENT AGREEMENT
THIS First Amendment to Amended and Restated Letter of Credit
and Reimbursement Agreement (this "First Amendment") is made as of the 21st day
of August, 2003, among SOUTH JERSEY INDUSTRIES, INC., a New Jersey corporation
("South Jersey"), MARINA ENERGY LLC, a New Jersey limited liability company
("Marina Energy"; and together with South Jersey, collectively, the
"Obligors"),WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association
having its principal offices in Charlotte, North Carolina ("Wachovia"), as the
Fronting Bank (the "Fronting Bank"), WACHOVIA, as the Administrative Agent (the
"Administrative Agent") and the participating banks listed on the signature
pages hereto (the "Banks"). Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to them in the Reimbursement
Agreement (as defined below).
WITNESSETH:
WHEREAS, the undersigned are parties to that certain Amended
and Restated Letter of Credit and Reimbursement Agreement dated as of September
19, 2002 (the "Reimbursement Agreement");
WHEREAS, the Company has requested that the Administrative
Agent and the Banks amend certain provisions of the Reimbursement Agreement in
order to further coincide with certain provisions set forth in (1) the 364-Day
Revolving Credit Agreement between Wachovia, South Jersey and the several
lenders from time to time party thereto, and (2) Three-Year Revolving Credit
Agreement between Wachovia, South Jersey Gas Company and the several lenders
from time to time party thereto; and
WHEREAS, the parties to the Reimbursement Agreement wish to
amend the Reimbursement Agreement in accordance with the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the premises set forth above (which are
incorporated herein by this reference) and for other good and valuable
consideration, the receipt and sufficiency of which hereby are acknowledged,
each of the undersigned agrees as follows:
1. Amendments to Reimbursement Agreement. The Reimbursement
Agreement is amended as follows:
(a) Section 1.01
(i) Section 1.01 of the Reimbursement Agreement is
amended by adding the following definitions in alphabetical order:
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"Continuing Director" means, with respect to any
Person as of any date of determination, any member of the
board of directors of such Person who (a) was a member of such
board of directors on the Closing Date, or (b) was nominated
for election or elected to such board of directors with the
approval of a majority of the Continuing Directors who were
members of such board at the time of such nomination or
election.
"First Mortgage Notes" means those First Mortgage
Notes identified on Schedule I attached hereto, and subsequent
First Mortgage Notes issued in accordance with this Agreement.
"Hedging Obligations" means, with respect to any
Person, the obligations of such Person under any interest rate
or currency swap agreement, interest rate or currency future
agreement, interest rate collar agreement, swap agreement (as
defined in 11 U.S.C. ss. 101), interest rate or currency hedge
agreement, and any put, call or other agreement or arrangement
designed to protect such Person against fluctuations in
interest rates or currency exchange rates.
"South Jersey Gas Company" means South Jersey Gas
Company, a New Jersey corporation.
(ii) The following definitions in Section 1.01 of the
Reimbursement Agreement are amended to read in their entirety as
follows:
"Change in Control" means the occurrence of either of
the following: (i) any entity, person (within the meaning of
Section 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act) which
theretofore was beneficial owner (as defined in Rule 13d-3
under the Exchange Act) of less than 20% of the South Jersey's
then outstanding common stock either (x) acquires shares of
common stock of the South Jersey in a transaction or series of
transactions that results in such entity, person or group
directly or indirectly owning beneficially 20% or more of the
outstanding common stock of South Jersey, or (y) acquires, by
proxy or otherwise, the right to vote for the election of
directors, for any merger, combination or consolidation of the
Obligors or any of its direct or indirect Subsidiaries, or,
for any other matter or question, more than 20% of the then
outstanding voting securities of South Jersey; or (ii) 20% or
more of the directors of the board of directors of South
Jersey fail to consist of Continuing Directors.
"Consolidated EBIT" means, with respect to South
Jersey and its Consolidated Subsidiaries, for any period, an
amount equal to: (i) Consolidated Net Income for such period,
plus (ii) amounts deducted in the computation thereof for (a)
Consolidated Interest Expense and (b) federal, state and local
income taxes.
"Consolidated Interest Expense" means, with respect
to South Jersey and its Consolidated Subsidiaries, for any
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period, an amount equal to (i) all interest in respect of
Indebtedness accrued during such period (whether or not
actually paid during such period), plus (ii) the net amount
payable (or minus the net amount receivable) under any Hedging
Obligation with respect to such Indebtedness accrued during
such period (whether or not actually paid or received during
such period).
"Consolidated Net Income" means the net income of
South Jersey and its Consolidated Subsidiaries, as determined
on a consolidated basis in accordance with GAAP and as
adjusted to exclude (i) net after-tax extraordinary or
non-recurring gains or losses (whether cash or non-cash gains
or losses), (ii) net after-tax gains or losses attributable to
any sale of capital assets, (iii) the net income of any
Consolidated Subsidiary to the extent that dividends or
distributions of such net income are not at the date of
determination permitted by the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule
or other regulation and (iv) the cumulative effect of any
changes in GAAP.
"Indebtedness" means, for any Person, all obligations
of such Person which in accordance with GAAP should be
classified on a balance sheet of such Person as liabilities of
such Person, and in any event shall include, without
duplication, all (i) indebtedness for borrowed money, (ii)
obligations evidenced by bonds, debentures, notes or other
similar instruments, (iii) obligations to pay the deferred
purchase price of property or services, (iv) obligations as
lessee under leases which shall have been or should be, in
accordance with GAAP, recorded as capital leases, (v)
obligations as lessee under operating leases which have been
recorded as off-balance sheet liabilities, (vi) obligations
under Hedging Obligations, (vii) reimbursement obligations
(contingent or otherwise) in respect of outstanding letters of
credit, (viii) indebtedness of the type referred to in clauses
(i) through (vi) above secured by (or for which the holder of
such indebtedness has an existing right, contingent or
otherwise, to be secured by) any lien or encumbrance on, or
security interest in, property (including, without limitation,
accounts and contract rights) owned by such Person, even
though such Person has not assumed or become liable for the
payment of such indebtedness, and (ix) obligations under
direct or indirect guaranties in respect of, and obligations
(contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of,
indebtedness or obligations of others of the kinds referred to
in clauses (i) through (vii) above. Notwithstanding anything
to the contrary set forth above, Capital Stock, including
Capital Stock having a preferred interest, shall not
constitute Indebtedness for purposes of this Agreement.
"Material Adverse Change" means (a) a materially
adverse change in the business, assets, liabilities (actual or
contingent), operations, condition (financial or otherwise) or
prospects of (i) South Jersey or (ii) South Jersey and its
Subsidiaries, taken as a whole, (b) any material impairment of
the ability of any Obligor to perform any of its respective
Obligations under this Agreement or any Related Document or
(c) any material impairment of the rights of, or benefits
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available to, the Administrative Agent, the Fronting Bank or
the Banks under this Agreement or any of the Related
Documents.
"Permitted Indebtedness" means any of the following:
(1) Indebtedness under this Agreement;
(2) Indebtedness of South Jersey (other than the type
described in clauses (3), (4) and (5) below) in an aggregate
principal amount not to exceed $100,000,000 (inclusive of the
type described in clause (1) above) at any time outstanding;
(3) Indebtedness of South Jersey Gas Company under
the First Mortgage Notes existing as of the Closing Date and
as identified on Schedule I attached hereto, and subsequent
First Mortgage Notes, so long as before and immediately after
the incurrence of such Indebtedness, South Jersey is in
compliance with Section 5.04;
(4) With respect to South Jersey Gas Company and its
Subsidiaries, any Indebtedness so long as before and
immediately after the incurrence of such Indebtedness, South
Jersey is in compliance with Section 5.04; and
(5) Indebtedness of the Obligors or South Jersey Gas
Company under Hedging Obligations covering a notional amount
not to exceed the face amount of the outstanding Indebtedness.
"Permitted Liens" means, with respect to any Person,
any of the following:
(1) Liens for taxes, assessments or governmental
charges not delinquent or being contested in good faith and by
appropriate proceedings and for which adequate reserves in
accordance with GAAP are maintained on such Person's books;
(2) Liens arising out of deposits in connection with
workers' compensation, unemployment insurance, old age
pensions or other social security or retirement benefits
legislation;
(3) Deposits or pledges to secure bids, tenders,
contracts (other than contracts for the payment of money),
leases, statutory obligations, surety and appeal bonds, and
other obligations of like nature arising in the ordinary
course of such Person's business;
(4) Liens imposed by law, such as mechanics',
workers', materialmen's, carriers' or other like liens arising
in the ordinary course of such Person's business which secure
the payment of obligations which are not past due or which are
being diligently contested in good faith by appropriate
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proceedings and for which adequate reserves in accordance with
GAAP are maintained on such Person's books;
(5) Rights of way, zoning restrictions, easements and
similar encumbrances affecting such Person's real property
which do not materially interfere with the use of such
property;
(6) With respect to South Jersey, Liens securing
Permitted Indebtedness, described in clause (2) of the
definition of "Permitted Indebtedness", not in excess of
$5,000,000 in the aggregate;
(7) With respect to South Jersey Gas Company, Liens
securing Permitted Indebtedness, described in clause (4) of
the definition of "Permitted Indebtedness", not in excess of
$5,000,000 in the aggregate;
(8) With respect to Marina Energy, Liens on the real
property owned by Marina Energy securing the Bonds;
(9) Purchase money security interests for the
purchase of equipment to be used in the Obligors' or South
Jersey Gas Company's business, encumbering only the equipment
so purchased, and which secures only the purchase-money
Indebtedness incurred to acquire the equipment so purchased,
which Indebtedness qualifies as Permitted Indebtedness and
which Indebtedness is not in excess of $5,000,000;
(10) With respect to South Jersey Gas Company, Liens
securing Permitted Indebtedness of the type described in
clause (3) of "Permitted Indebtedness".
"Rated Entity" means South Jersey or any of its
subsidiaries which maintain senior unsecured, non-credit
enhanced debt ratings by both Xxxxx'x and S&P. If more than
one such Person exists, the Rated Entity shall be South Jersey
or any of its Subsidiaries which maintains the lowest senior
unsecured, non-credit enhanced debt rating by either Xxxxx'x
or S&P.
(b) Section 5.01(b) of the Reimbursement Agreement is amended
to read as follows:
(b) Maintenance of Properties, Etc. Maintain, and cause each
of its Subsidiaries to maintain, good and marketable title to all of
its properties which are used or useful in the conduct of its business,
and preserve, maintain, develop and operate, and cause each of its
Subsidiaries to preserve, maintain, develop and operate, in substantial
conformity with all laws and material contractual obligations, all such
properties in good working order and condition, ordinary wear and tear
excepted, except where such failure would not result in a Material
Adverse Change.
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(c) Section 5.01(l) of the Reimbursement Agreement is amended
to read as follows:
(l) Further Assurances. At the expense of the Obligors,
promptly execute and deliver, or cause to be promptly executed and
delivered, all further instruments and documents, and take and cause to
be taken all further actions, that may be reasonably necessary or that
the Required Banks through the Administrative Agent may reasonably
request, to enable the Banks and the Administrative Agent to enforce
the terms and provisions of this Agreement and the Related Documents
and to exercise their rights and remedies hereunder. In addition, the
Obligors will use all reasonable efforts to duly obtain Governmental
Actions required from time to time on or prior to such date as the same
may become legally required, and thereafter to maintain all such
Governmental Actions in full force and effect, except where such
failure would not result in a Material Adverse Change.
(d) Section 5.02(e) of the Reimbursement Agreement is amended
to read as follows:
(e) Sale of Assets, Etc. Sell, transfer, lease, assign or
otherwise convey or dispose, or permit any Subsidiary to sell,
transfer, lease, assign or otherwise convey or dispose, of assets
(whether now owned or hereafter acquired), in any single transaction or
series of transactions, whether or not related having an aggregate book
value in excess of 10% of the Consolidated assets of South Jersey and
its Consolidated Subsidiaries, except for dispositions of capital
assets in the ordinary course of business as presently conducted
(e) Section 5.02(f) of the Reimbursement Agreement is amended
to read as follows:
(f) Restricted Investments. Other than in the ordinary course
of business (i) make or permit to exist any loans or advances to, or
any other investment in, any Person except for investments in Permitted
Investments, or (ii) acquire any assets or property of any other
Person.
(f) Section 5.02(h) of the Reimbursement Agreement is amended
to read as follows:
(h) Distributions. Pay any dividends on or make any other
distributions in respect of any Capital Stock or redeem or otherwise
acquire any such Capital Stock without in each instance obtaining the
prior written consent of the Required Lenders; provided, that (i) any
Subsidiary of South Jersey (other than Marina Energy) may pay regularly
scheduled dividends or make other distributions to South Jersey; and
(ii) if no Default or Event of Default exists or would result
therefrom, South Jersey may pay distributions or dividends in either
cash or Capital Stock or may redeem or otherwise acquire Capital Stock.
(g) Section 5.02(i) of the Reimbursement Agreement is amended
to read as follows:
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(i) Lease Obligations. Permit the aggregate obligations of
South Jersey and its Subsidiaries that are due and payable during any
fiscal year under leases or agreements to lease (other than obligations
under Capital Leases) to exceed $5,000,000.
(h) Section 5.03(e) of the Reimbursement Agreement is amended
to read as follows:
(e) as soon as possible and in any event within five (5) days
after the occurrence of each Event of Default and each Default known to
any of the Obligors, a statement of the chief financial officer of the
Obligors setting forth details of such Event of Default or Default and
the action which the Obligors have taken and propose to take with
respect thereto;
(i) Section 5.04(b) of the Reimbursement Agreement is amended
to read as follows:
(b) Consolidated EBIT to Consolidated Interest Expense.
Maintain at the end of each fiscal quarter, for the four consecutive
fiscal quarters then ending, a ratio of Consolidated EBIT to
Consolidated Interest Expense of the Borrower and its Consolidated
Subsidiaries of not less than 2.0 to 1.0.
(j) Section 6.02 of the Reimbursement Agreement is amended
to add the following sentence to the end of such Section 6.02:
"Nevertheless, any acceleration of Bonds, Demand Loans and
Tender Advances under this Section 6.02 shall not require the
acceleration of any Hedging Obligations, which shall be governed by the
terms and conditions of the documents controlling such Hedging
Obligations."
(k) Section 9.05(a) of the Reimbursement Agreement is amended
to read as follows:
(a) by reason of any inaccuracy or alleged inaccuracy in any
material respect, or any untrue statement or alleged untrue statement
of any material fact, or by reason of the omission or alleged omission
to state therein a material fact necessary to make such statements, in
the light of the circumstances under which they were made, not
misleading, in each case relating to this Agreement or any of the
Related Documents and the transactions contemplated thereby, or in any
manner, whether direct or indirect, related to this Agreement.
2. Representations and Warranties. The Obligors hereby
represent and warrant that (A) all of the representations and warranties
contained in Section 4.01 of the Reimbursement Agreement are true, correct and
complete as of the date hereof, and (B) no Default or Event of Default has
occurred and is continuing on the date hereof before or after giving effect to
this First Amendment.
3. Successors and Assigns. This First Amendment shall be
binding upon and inureto the benefit of each of the parties hereto and its
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respective successors and assigns. The successor and assigns of such entities
shall include, without limitation, their respective receivers, trustees, or
debtors-in-possession.
4. Further Assurances. The Obligors hereby agree from time to
time, as and when requested by the Fronting Bank, to execute and deliver or
cause to be executed and delivered, all such documents, instruments and
agreements and to take or cause to be taken such further or other action as the
Fronting Bank may reasonably deem necessary in order to carry out the intent and
purposes of this First Amendment.
5. Fees and Expenses. The Obligors hereby agree to pay all
costs, fees and expenses (including reasonable attorneys' fees) incurred by the
Fronting Bank indrafting this First Amendment and documents related thereto and
in collecting or enforcing the undersigned's obligations under this First
Amendment.
6. Definitions. All references to the singular shall be deemed
to include the plural and vice versa where the context so requires.
7. Governing Law. THIS FIRST AMENDMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO NEW YORK CHOICE OF LAW PRINCIPLES.
8. Severability. Wherever possible, each provision of this
First Amendment shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this First Amendment shall be
prohibited by or invalid under such law, such provision shall be ineffective to
the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this First Amendment.
9. Execution in Counterparts. This First Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
10. Section Headings. The section headings herein are for
convenience of reference only, and shall not affect in any way the
interpretation of any of the provisions hereof.
11. No Amendment. Except as expressly and specifically amended
hereby and by the First Amendment, the Reimbursement Agreement remain
unmodified and in full force and effect.
[Signature Pages Follow]
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IN WITNESS WHEREOF, this First Amendment has been duly
executed by each of the undersigned as of the day and year first set forth
above.
THE OBLIGORS:
SOUTH JERSEY INDUSTRIES, INC.
By: /s/ XXXXX X. XXXXXXXX
--------------------------------------
Xxxxx X. Xxxxxxxx
Vice President, Treasurer &
Chief Financial Officer
MARINA ENERGY LLC
By: South Jersey Industries, Inc.
Its: Sole Member
By:/s/ XXXXX X. XXXXXXXX
--------------------------------------
Xxxxx X. Xxxxxxxx
Vice President, Treasurer &
Chief Financial Officer
Counterpart signature page to the First Amendment to the Amended and Restated
Letter of Credit and Reimbursement Agreement dated as of August 21, 2003 among
South Jersey Industries, Inc., Marina Energy LLC, Wachovia Bank, National
Association and the participating banks a party thereto.
Page S1
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent, as Fronting Bank
and as a Bank
By:/s/ XXXXXXXX X. XXXXXXXX
--------------------------------------
Xxxxxxxx X. Xxxxxxxx
Vice President
Counterpart signature page to the First Amendment to the Amended and Restated
Letter of Credit and Reimbursement Agreement dated as of August 21, 2003 among
South Jersey Industries, Inc., Marina Energy LLC, Wachovia Bank, National
Association and the participating banks a party thereto.
Page S2
The Banks:
XXXXXX UNITED BANK
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------
Title: Senior Vice President
---------------------------------
Counterpart signature page to the First Amendment to the Amended and Restated
Letter of Credit and Reimbursement Agreement dated as of August 21, 2003 among
South Jersey Industries, Inc., Marina Energy LLC, Wachovia Bank, National
Association and the participating banks a party thereto.
Page S3
COMMERCE BANK, N.A.
By: /s/ XXXXXX X. XXXXX
--------------------------------------
Name: Xxxxxx X. Xxxxx
--------------------------------------
Title: Senior Vice President
--------------------------------------
Counterpart signature page to the First Amendment to the Amended and Restated
Letter of Credit and Reimbursement Agreement dated as of August 21, 2003 among
South Jersey Industries, Inc., Marina Energy LLC, Wachovia Bank, National
Association and the participating banks a party thereto.
Page S4
SUN NATIONAL BANK
By: /s/ XXXXX XXXXX
--------------------------------------
Name: Xxxxx Xxxxx
----------------------------------
Title: Vice President
----------------------------------
Counterpart signature page to the First Amendment to the Amended and Restated
Letter of Credit and Reimbursement Agreement dated as of August 21, 2003 among
South Jersey Industries, Inc., Marina Energy LLC, Wachovia Bank, National
Association and the participating banks a party thereto.
Page S5
SCHEDULE I
First Mortgage Notes
Series Outstanding
Bonds of the Seventeenth Series $9,089,000
Bonds of the Eighteenth Series $31,850,000
Bonds of the Nineteenth Series $35,000,000
Bonds of the Twentieth Series $99,965,000
Bonds of the Twenty-First Series $85,500,000
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