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Exhibit 10.1

Execution Version

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South Jersey Gas Company
 
$525,000,000 Senior Secured Notes
 
$150,000,000 Senior Secured Notes, Series F, 2020, Tranche A
due April 16, 2030
 
$250,000,000 Senior Secured Notes, Series F, 2020, Tranche B
due April 16, 2050

$125,000,000 Senior Secured Notes, Series F, 2020, Tranche C
due October 1, 2050
 

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Note Purchase Agreement
 

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Dated as of April 16, 2020
 

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Table of Contents

Section
Heading
Page
       
Section 1.
Authorization of Notes
1
         
Section 1.1.
Authorization of Notes
1
 
Section 1.2.
Pledged Mortgage Bonds
2
       
Section 2.
Sale and Purchase of Notes
2
       
Section 3.
Closings
2
       
Section 4.
Conditions to Each Closing
3
         
Section 4.1.
Representations and Warranties of the Company
3
 
Section 4.2.
Performance; No Default
3
 
Section 4.3.
Compliance Certificates
3
 
Section 4.4.
Opinions of Counsel
4
 
Section 4.5.
Purchase Permitted by Applicable Law, Etc
4
 
Section 4.6.
Sale of Notes
4
 
Section 4.7.
Payment of Special Counsel Fees
4
 
Section 4.8.
Private Placement Number
5
 
Section 4.9.
Changes in Corporate Structure
5
 
Section 4.10.
Funding Instructions
5
 
Section 4.11.
UCC Financing Statements and the Supplement
5
 
Section 4.12.
Possession of Pledged Mortgage Bonds
5
 
Section 4.13.
Proceedings and Documents
5
       
Section 5.
Representations and Warranties of the Company
6
         
Section 5.1.
Organization; Power and Authority
6
 
Section 5.2.
Authorization, Etc
6
 
Section 5.3.
Disclosure
6
 
Section 5.4
Subsidiaries
7
 
Section 5.5.
Financial Statements; Material Liabilities
7
 
Section 5.6.
Compliance with Laws, Other Instruments, Etc
7
 
Section 5.7.
Governmental Authorizations, Etc
7
 
Section 5.8.
Litigation; Observance of Statutes and Orders
7
 
Section 5.9.
Taxes
8
 
Section 5.10.
Title to Property; Leases
8
 
Section 5.11.
Licenses, Permits, Etc
8
 
Section 5.12.
Compliance with ERISA
8
 
Section 5.13.
Private Offering by the Company
9
 
Section 5.14.
Use of Proceeds; Margin Regulations
9
 
Section 5.15.
Existing Indebtedness
10
 
Section 5.16.
Foreign Assets Control Regulations, Etc
10
 
Section 5.17.
Status under Certain Statutes
11

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Section 5.18.
Environmental Matters
11
 
Section 5.19.
Lien of Mortgage
12
 
Section 5.20.
Filings under Indenture
12
 
Section 5.21.
Status of Certain Material Agreements
12
       
Section 6.
Representations of the Purchasers
12
         
Section 6.1.
Purchase for Investment
12
 
Section 6.2.
Source of Funds
13
 
Section 6.3.
Purchaser Status; Experience
14
 
Section 6.4.
Access to Information
14
       
Section 7.
Information as to Company
15
         
Section 7.1.
Financial and Business Information
15
 
Section 7.2.
Officer’s Certificate
17
 
Section 7.3.
Visitation
18
       
Section 8.
Payment and Prepayment of the Notes
18
         
Section 8.1.
Maturity
18
 
Section 8.2.
Optional Prepayments with Make‑Whole Amount
19
 
Section 8.3.
Allocation of Partial Prepayments
19
 
Section 8.4.
Maturity; Surrender, Etc
19
 
Section 8.5.
Purchase of Notes
19
 
Section 8.6.
Make‑Whole Amount for the Notes
20
 
Section 8.7.
Change in Control
21
       
Section 9.
Affirmative Covenants
22
         
Section 9.1.
Compliance with Law
22
 
Section 9.2.
Insurance
23
 
Section 9.3.
Maintenance of Properties
23
 
Section 9.4.
Payment of Taxes
23
 
Section 9.5.
Corporate Existence, Etc
23
 
Section 9.6.
Books and Records
23
 
Section 9.7.
Compliance with Material Agreements
24
 
Section 9.8.
Ownership
24
 
Section 9.9.
Recording of the Second Supplement
24
       
Section 10.
Negative Covenants
24
         
Section 10.1.
Transactions with Affiliates
24
 
Section 10.2.
Line of Business
24
 
Section 10.3.
Terrorism Sanctions Regulations
24
 
Section 10.4.
Release of Lien of Indenture or Mortgage
25
 
Section 10.5.
Tax Withholding
25
       
Section 11.
Events of Default
25

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Section 12.
Remedies on Default, Etc.
27
         
Section 12.1.
Acceleration
27
 
Section 12.2.
Other Remedies
28
 
Section 12.3.
Rescission
28
 
Section 12.4.
No Waivers or Election of Remedies, Expenses, Etc
28
       
Section 13.
Payments on Notes
28
         
Section 13.1.
Home Office Payment
28
       
Section 14.
Registration; Exchange; Expenses, Etc
29
         
Section 14.1.
Registration of Notes
29
 
Section 14.2.
Transaction Expenses
29
 
Section 14.3.
Survival
29
       
Section 15.
Survival of Representations and Warranties; Entire Agreement
29
       
Section 16.
Amendment and Waiver
30
         
Section 16.1.
Requirements
30
 
Section 16.2.
Solicitation of Holders of Notes
30
 
Section 16.3.
Binding Effect, Etc
31
 
Section 16.4.
Notes Held by Company, Etc
31
       
Section 17.
Notices
31
       
Section 18.
Indemnification
32
       
Section 19.
Reproduction of Documents
32
       
Section 20.
Confidential Information
33
       
Section 21.
Miscellaneous
34
         
Section 21.1.
Successors and Assigns
34
 
Section 21.2.
Accounting Terms
34
 
Section 21.3.
Severability
34
 
Section 21.4.
Construction, Etc
34
 
Section 21.5.
Counterparts
34
 
Section 21.6.
Governing Law
34
 
Section 21.7.
Jurisdiction and Process; Waiver of Jury Trial
35
 
Section 21.8.
Payments Due on Non‑Business Days
35
 
Section 21.9.
Purchasers
35

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Schedule A
—
Information Relating to Purchasers
Schedule B
—
Defined Terms
Schedule 4.11
—
Collateral Filings
Schedule 5.5
—
Financial Statements
Schedule 5.15(a)
—
Existing Indebtedness
Schedule 5.15(b)
—
Liens not permitted by Mortgage
Schedule 5.15(c)
—
Debt Instruments
Exhibit 4.4(a)(i)
—
Form of Opinion of Special Counsel for the Company
Exhibit 4.4(a)(ii)
—
Form of Opinion of General Counsel for the Company
Exhibit 10.5
—
Form of U.S. Tax Compliance Certificate

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South Jersey Gas Company
One South Jersey Plaza, Route 54
Folsom, New Jersey 08037
 
$150,000,000 Senior Secured Notes, Series F, 2020, Tranche A
due April 16, 2030
 
$250,000,000 Senior Secured Notes, Series F, 2020, Tranche B
due April 16, 2050

$125,000,000 Senior Secured Notes, Series F, 2020, Tranche C
due October 1, 2050
 
April 16, 2020
 
To Each of the Purchasers Listed in
Schedule A Hereto:
 
Ladies and Gentlemen:
 
South Jersey Gas Company, a corporation organized under the laws of the State of
New Jersey (the “Company”), agrees with each of the purchasers whose names
appear at the end hereof (each, a “Purchaser” and, collectively, the
“Purchasers”) as follows:
 
Section 1.           Authorization of Notes.
 
Section 1.1.         Authorization of Notes  The Company has authorized and will
create an issue of (i) $150,000,000 aggregate principal amount of its Senior
Secured Notes, Series F, 2020, Tranche A, due April 16, 2030 (the “Tranche A
Notes”), (ii) $250,000,000 aggregate principal amount of its Senior Secured
Notes, Series F, 2020, Tranche B, due April 16, 2050 (the “Tranche B Notes”),
and (iii) $125,000,000 aggregate principal amount of its Senior Secured Notes,
Series F, 2020, Tranche C, due October 1, 2050 (the “Tranche C Notes” and,
together with the Tranche A Notes and the Tranche B Notes, the “Notes”).  The
Notes will be issued under an Indenture of Trust dated as of October 1, 1998
(the “Original Indenture”), between the Company and The Bank of New York Mellon,
as Trustee (the “Trustee”), as heretofore supplemented by five Supplemental
Indentures.  The Original Indenture as so amended and supplemented is herein
called the “Indenture.”  Copies of the Original Indenture and all the
supplemental indentures requested by you have been delivered to you.  The Notes
shall be issuable in fully registered form only.  The Tranche A Notes shall
mature on April 16, 2030, shall bear interest at the rate of 3.28% per annum
payable semiannually, on April 16 and October 16 of each year and at maturity
commencing on October 16, 2020, the Tranche B Notes shall mature on April 16,
2050, shall bear interest at the rate of 3.93% per annum payable semiannually,
on April 16 and October 16 of each year and at maturity commencing on October
16, 2020, and the Tranche C Notes shall mature on October 1, 2050, shall bear
interest at the rate of 3.98% per annum payable semiannually, on October 1 and
April 1 of each year and at maturity commencing on April 1, 2021.  The Notes
shall be subject to redemption as provided in the Indenture, and shall be in the
form established pursuant to the Indenture.  As permitted by the Indenture, the
Notes originally issued to you thereunder shall be dated, and bear interest
from, the date of their original issue on the date of the applicable Closing.
 

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South Jersey Gas Company
Note Purchase Agreement

Certain capitalized and other terms used in this Agreement are defined in
Schedule B; and references to a “Schedule” or an “Exhibit” are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.  Terms used
herein but not defined herein shall have the meanings set forth in the
Indenture. 
 
Section 1.2.         Pledged Mortgage Bonds.  The Notes will be secured under
that certain Supplemental Indenture Amending and Restating First Mortgage
Indenture (the “Original Mortgage”) dated as of January 23, 2017, between the
Company and The Bank of New York Mellon (the “Mortgage Trustee”) (the Original
Mortgage, as supplemented to date and from time to time hereafter, including
without limitation that Second Supplemental Indenture (the “Second Supplement”)
dated as of April 16, 2020 between the Company and the Mortgage Trustee, the
“Mortgage”).  Specifically, (i) the Tranche A Notes will be secured by that
certain First Mortgage Bond, Series F, Tranche A, dated April 16, 2020 (the
“Tranche A Pledged Mortgage Bond”) issued to the Trustee to secure up to an
aggregate of $150,000,000 principal amount of Tranche A Notes issued under the
Indenture, (ii) the Tranche B Notes will be secured by that certain First
Mortgage Bond, Series F, Tranche B, dated April 16, 2020 (the “Tranche B Pledged
Mortgage Bond”) issued to the Trustee to secure up to an aggregate of
$250,000,000 principal amount of Tranche B Notes issued under the Indenture, and
(iii) the Tranche C Notes will be secured by that certain First Mortgage Bond,
Series F, Tranche C, to be dated October 1, 2020 (the “Tranche C Pledged
Mortgage Bond” and, together with the Tranche A Pledged Mortgage Bond and the
Tranche B Pledged Mortgage Bond, each a “Pledged Mortgage Bond” and,
collectively, the “Pledged Mortgaged Bonds”) issued to the Trustee to secure up
to an aggregate of $125,000,000 principal amount of Tranche C Notes issued under
the Indenture.  Excluding the Notes, none of the Pledged Mortgage Bonds secure
any notes of the Company.
 
Section 2.           Sale and Purchase of Notes.
 
Subject to the terms and conditions of this Agreement, the Company will issue
and sell to each Purchaser and each Purchaser will purchase from the Company, at
the applicable Closing provided for in Section 3, Notes in the principal
amount(s) and of the Tranche(s) specified opposite such Purchaser’s name in
Schedule A at the purchase price of 100% of the principal amount thereof.  The
Purchasers’ obligations hereunder are several and not joint obligations, and no
Purchaser shall have any liability to any Person for the performance or
non‑performance of any obligation by any other Purchaser hereunder.
 
Section 3.           Closings.
 
The execution and delivery of this Agreement and the sale and purchase of the
Tranche A Notes and the Tranche B Notes to be purchased by each Purchaser
thereof shall occur at a closing on April 16, 2020 or on such other Business Day
thereafter on or prior to April 30, 2020 as may be agreed upon by the Company
and the Purchasers of the Tranche A Notes and the Tranche B Notes (the “First
Closing”), and the sale and purchase of the Tranche C Notes to be purchased by
each Purchaser thereof shall occur at a closing on October 1, 2020 or on such
other Business Day thereafter on or prior to October 30, 2020 as may be agreed
upon by the Company and the Purchasers of the Tranche C Notes (the “Second
Closing”), in each case, at the offices of Chapman and Cutler LLP, 111 West
Monroe Street, Chicago, Illinois 60603 at 9:00 a.m. Central time, on the date of
the applicable Closing.  The First Closing and the Second Closing are each
referred to herein as a “Closing.”  On the date of the applicable Closing, the
Company will deliver to each Purchaser the Notes of the applicable Tranche(s) to
be purchased by such Purchaser in the form of a single Note (or such greater
number of Notes in denominations of at least $100,000 as such Purchaser may
request) of such Tranche(s) in the amount(s) purchased, dated the date of the
applicable Closing and registered in such Purchaser’s name (or in the name of
such Purchaser’s nominee), against delivery by such Purchaser to the Company or
its order of immediately available funds in the amount of the purchase price
therefor by wire transfer of immediately available funds for the account of the
Company to an account specified pursuant to Section 4.10 hereof.  If, on the
date of the applicable Closing, the Company shall fail to tender such Notes to
such Purchaser as provided above in this Section 3, or any of the conditions
specified in Section 4 with respect to such Closing shall not have been
fulfilled to any Purchaser’s reasonable satisfaction, such Purchaser shall, at
such Purchaser’s election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights such Purchaser may have by reason
of such failure or such nonfulfillment.
 

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South Jersey Gas Company
Note Purchase Agreement

Section 4.           Conditions to Each Closing.
 
Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such
Purchaser at the applicable Closing is subject to the fulfillment to such
Purchaser’s reasonable satisfaction, prior to or at the applicable Closing, of
the following conditions:
 
Section 4.1.          Representations and Warranties of the Company.  The
representations and warranties of the Company in this Agreement shall be correct
when made and at the time of each Closing.
 
Section 4.2.         Performance; No Default.  The Company shall have performed
and complied with all agreements and conditions contained in each Financing
Agreement required to be performed or complied with by the Company prior to or
at such Closing, and after giving effect to the issue and sale of the Tranche A
Notes and the Tranche B Notes in the case of the First Closing, and the Tranche
C Notes in the case of the Second Closing, as applicable (and the application of
the proceeds thereof as contemplated by Section 5.14), (i) no Default or Event
of Default shall have occurred and be continuing, and (ii) no Change in Control
or Control Event shall have occurred. 
 
Section 4.3.          Compliance Certificates.  The Company shall have performed
and complied with all agreements and conditions contained in the Indenture and
the Mortgage which are required to be performed or complied with by the Company
for the issuance of the Notes and the Pledged Mortgage Bonds at the applicable
Closing.  In addition, on the date of each Closing the Company shall have
delivered the following certificates:
 
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South Jersey Gas Company
Note Purchase Agreement

(a)         Officer’s Certificates.  The Company shall have delivered to such
Purchaser (i) an Officer’s Certificate, dated the date of the applicable
Closing, certifying that the conditions specified in Section 4 of this Agreement
with respect to such Closing have been fulfilled, (ii) copies of all
certificates and opinions required to be delivered to the Trustee under the
Indenture in connection with the issuance of the applicable Notes under the
Indenture, in each case, dated the date of the applicable Closing, and (iii)
copies of all certificates and opinions delivered to the Mortgage Trustee under
the Mortgage in connection with the issuance of the applicable Pledged Mortgage
Bond; and
 
(b)         Secretary’s Certificate.  The Company shall have delivered to such
Purchaser a certificate of its Secretary or Assistant Secretary, dated the date
of such Closing, certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
this Agreement, the applicable Notes and the applicable Pledged Mortgage Bond.
 
Section 4.4.          Opinions of Counsel.  Such Purchaser shall have received
opinions in form and substance reasonably satisfactory to such Purchaser, dated
the date of the applicable Closing (a) from (i) Cozen O’Connor,counsel for the
Company, and (ii) Melissa Orsen, Senior Vice President and General Counsel to
the Company, covering the matters set forth in Exhibits 4.4(a)(i) and 4.4(a)(ii)
and covering such other matters incident to the transactions contemplated hereby
as such Purchaser or its counsel may reasonably request and (b) from Chapman and
Cutler LLP, the Purchasers’ special counsel in connection with such
transactions, covering such matters incident to such transactions as such
Purchaser may reasonably request.  The Company hereby directs its counsel to
deliver such opinions and understands and agrees that each Purchaser will and
hereby is authorized to rely on such opinions to the extent set forth therein. 
 
Section 4.5.          Purchase Permitted by Applicable Law, Etc.  On the date of
the applicable Closing, such Purchaser’s purchase of the applicable Notes shall
(a) be permitted by the laws and regulations of each jurisdiction to which such
Purchaser is subject, without recourse to provisions (such as Section 1405(a)(8)
of the New York Insurance Law) permitting limited investments by insurance
companies without restriction as to the character of the particular investment,
(b) not violate any applicable law or regulation (including, without limitation,
Regulation T, U or X of the Board of Governors of the Federal Reserve System)
and (c) not subject such Purchaser to any tax, penalty or liability under or
pursuant to any applicable law or regulation, which law or regulation was not in
effect on the date hereof.  If requested by such Purchaser, such Purchaser shall
have received an Officer’s Certificate certifying as to such matters of fact as
such Purchaser may reasonably specify to enable such Purchaser to determine
whether such purchase is so permitted.
 
Section 4.6.          Sale of Notes.  Contemporaneously with such Closing, the
Company shall sell to each Purchaser and each Purchaser, as applicable, shall
purchase the applicable Notes to be purchased by it at such Closing as specified
in Schedule A.  In the case of the Second Closing, the transactions contemplated
herein with respect to the First Closing shall have been consummated in
accordance with the terms hereof.
 
Section 4.7.          Payment of Special Counsel Fees.  Without limiting the
provisions of Section 14.2, the Company shall have paid on or before each
Closing the reasonable fees, charges and disbursements of the Purchasers’
special counsel referred to in Section 4.4(b) to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to such Closing.
 
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South Jersey Gas Company
Note Purchase Agreement

Section 4.8.          Private Placement Number.  A Private Placement Number
issued by Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO)
shall have been obtained for each Tranche of the Notes.
 
Section 4.9.          Changes in Corporate Structure.  The Company shall not
have changed its jurisdiction of incorporation, or been a party to any merger or
consolidation or succeeded to all or any substantial part of the liabilities of
any other entity, at any time following the date of the most recent financial
statements referred to in Schedule 5.5.
 
Section 4.10.        Funding Instructions.  At least three Business Days prior
to the date of each Closing, each Purchaser, as applicable, shall have received
written instructions signed by a Responsible Officer on letterhead of the
Company setting forth wire instructions for payment of the purchase price of the
applicable Notes, including (a) the name and address of the transferee bank, (b)
such transferee bank’s ABA number, and (c) the account name and number into
which the purchase price for the applicable Notes is to be deposited.
 
Section 4.11.      UCC Financing Statements and the Supplement.  All UCC
Financing Statements, the Mortgage, the Second Supplement or other instruments
with respect thereto as may be necessary shall have been duly filed or recorded
(or, in the case of the Second Supplement, duly submitted within three (3)
Business Days of the date of the First Closing for recording) in such manner and
in such places as is reasonably satisfactory to the Purchasers (and their
special counsel) and the Company and as described in Schedule 4.11
(collectively, the “Collateral Filings”) (and no other instruments shall be
required to be filed) to establish and perfect the security interests and liens
of the Trustee in the Mortgaged Property created by the Mortgage and which can
be perfected by filing the Mortgage or a UCC Financing Statement under the UCC.
 
Section 4.12.        Possession of Pledged Mortgage Bonds.  (a) Each Purchaser
with respect to the First Closing shall have received written confirmation from
the Trustee that it has possession of the Tranche A Pledged Mortgage Bond and
the Tranche B Pledged Mortgage Bond in the aggregate outstanding principal
amount of $400,000,000 and that prior to the issuance of any of the Tranche A
Notes or the Tranche B Notes, there are no outstanding senior secured notes of
the Company issued under the Indenture that are secured by the Tranche A Pledged
Mortgage Bond or the Tranche B Pledged Mortgage Bond.
 
(b)          Each Purchaser with respect to the Second Closing shall have
received written confirmation from the Trustee that it has possession of the
Tranche C Pledged Mortgage Bond in the outstanding principal amount of
$125,000,000 and that prior to the issuance of any of the Tranche C Notes, there
are no outstanding senior secured notes of the Company issued under the
Indenture that are secured by the Tranche C Pledged Mortgage Bond.
 
Section 4.13.       Proceedings and Documents.  All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be
reasonably satisfactory to each Purchaser and its special counsel, and each
Purchaser and its special counsel shall have received all such counterpart
originals or certified or other copies of such documents as such Purchaser or
such special counsel may reasonably request.  Each Purchaser that so requests
shall have received a copy of the Indenture and the Mortgage (together with all
amendments and supplements thereto), certified by the Company as of the date of
such Closing, exclusive of property exhibits, recording information and the
like. 
 
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South Jersey Gas Company
Note Purchase Agreement

Section 5.           Representations and Warranties of the Company.
 
The Company represents and warrants to each Purchaser at a Closing that, as of
the date of such Closing:
 
Section 5.1.          Organization; Power and Authority.  The Company is a
corporation duly organized and validly existing under the State of New Jersey
and is in good standing under the laws of the State of New Jersey, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  The Company has the corporate power and authority to own or
hold under lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to execute and
deliver each Financing Agreement and to perform the provisions hereof and
thereof.
 
Section 5.2.          Authorization, Etc.  Each Financing Agreement has been
duly authorized by all necessary corporate action on the part of the Company,
and each Financing Agreement constitutes, and upon execution and delivery
thereof each Note will constitute, a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its respective terms,
except as such enforceability may be limited by (a) applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors’ rights generally and (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
 
Section 5.3.          Disclosure.  The Company, through its agents, BofA
Securities, Inc. and Wells Fargo Securities, LLC, has delivered to each
Purchaser a copy of an Investor Presentation, dated March 2020 (the “Investor
Presentation”), relating to the Company.  The Investor Presentation fairly
describes, in all material respects, the general nature of the business and
principal properties of the Company.  This Agreement (including all Schedules
attached hereto), the Investor Presentation, the documents, certificates or
other writings delivered to the Purchasers by or on behalf of the Company in
connection with the transactions contemplated hereby and the financial
statements listed in Schedule 5.5, in each case, delivered to the Purchasers
prior to the date of this Agreement (this Agreement (including all Schedules
hereto), the Investor Presentation and such documents, certificates or other
writings and such financial statements being referred to, collectively, as the
“Disclosure Documents”), taken as a whole, do not contain any untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein not misleading in light of the circumstances under which they
were made.  Except as disclosed in the Disclosure Documents, since December 31,
2019, there has been no change in the financial condition, operations, business
or properties of the Company except changes that individually or in the
aggregate would not reasonably be expected to have a Material Adverse Effect. 
There is no fact known to the Company that would reasonably be expected to have
a Material Adverse Effect that has not been set forth herein or in the
Disclosure Documents.
 
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South Jersey Gas Company
Note Purchase Agreement

Section 5.4           Subsidiaries.  The Company has no Subsidiaries.
 
Section 5.5.         Financial Statements; Material Liabilities.  The Company
has delivered to each Purchaser copies of the financial statements of the
Company listed in Schedule 5.5.  All of said financial statements (including in
each case the related schedules and notes) fairly present in all material
respects the financial position of the Company as of the respective dates
specified in such Schedule and the results of its operations and cash flows for
the respective periods so specified and have been prepared in accordance with
GAAP consistently applied throughout the periods involved except as set forth in
the notes thereto (subject, in the case of any interim financial statements, to
normal year‑end adjustments).  The Company does not have any Material
liabilities that are not disclosed on such financial statements or otherwise
disclosed in the Disclosure Documents or in Schedule 5.15.
 
Section 5.6.          Compliance with Laws, Other Instruments, Etc.  The
execution, delivery and performance by the Company of each Financing Agreement
will not (a) contravene, result in any breach of, or constitute a default under,
or result in the creation of any Lien, other than the Lien created under the
Mortgage, in respect of any property of the Company, under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate
charter or bylaws, or any other Material agreement or instrument to which the
Company is bound or by which the Company or any of its properties may be bound
or affected, (b) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company, including,
without limitation, the Public Order, or (c) violate any provision of any
statute or other rule or regulation of any Governmental Authority applicable to
the Company.
 
Section 5.7.        Governmental Authorizations, Etc.  No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of any Financing Agreement, except for any filing that has
already been made or any approval that has already been obtained, including
without limitation the Public Order, or for certain post‑Closing filing
requirements with the Board of Public Utilities, State of New Jersey, as
required by the Public Order.  The period of time for filing an appeal as of
right to the Superior Court of New Jersey, Appellate Division with respect to
the Public Order has expired. 
 
Section 5.8.          Litigation; Observance of Statutes and Orders.  (a) There
are no actions, suits, investigations or proceedings pending or, to the
knowledge of the Company, threatened against or affecting the Company or any
property of the Company in any court or before any arbitrator of any kind or
before or by any Governmental Authority that, individually or in the aggregate,
would reasonably be expected to have a Material Adverse Effect.
 
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(b)         The Company is not (i) in default under any term of any agreement or
instrument to which it is a party or by which it is bound, (ii) in violation of
any order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or (iii) in violation of any applicable law, ordinance, rule or
regulation of any Governmental Authority (including without limitation
Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations
that are referred to in Section 5.16), which default or violation, individually
or in the aggregate, would reasonably be expected to have a Material Adverse
Effect.
 
Section 5.9.        Taxes.  The Company has filed all tax returns that are
required to have been filed in any jurisdiction, and has paid all taxes shown to
be due and payable on such returns and all other taxes and assessments levied
upon it or its properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (a) the amount of which is not
individually or in the aggregate Material or (b) the amount, applicability or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company has established adequate
reserves in accordance with GAAP.  The Company knows of no basis for any other
tax or assessment that would reasonably be expected to have a Material Adverse
Effect.  The charges, accruals and reserves on the books of the Company in
respect of federal, state or other taxes for all fiscal periods are adequate. 
The federal income tax liabilities of the Company have been finally determined
(whether by reason of completed audits or the statute of limitations having run)
for all fiscal years up to and including the fiscal year ended December 31,
2013.
 
Section 5.10.        Title to Property; Leases.  The Company has good and
sufficient title to its properties that individually or in the aggregate are
Material, including all such properties reflected in the most recent audited
balance sheet referred to in Section 5.5 or purported to have been acquired by
the Company after said date (except as sold or otherwise disposed of in the
ordinary course of business), in each case free and clear of Liens (other than
the Lien created under the Mortgage) prohibited by this Agreement, the Indenture
or the Mortgage.  To the Company’s knowledge, all Material leases are valid and
subsisting and are in full force and effect in all material respects. 
 
Section 5.11.         Licenses, Permits, Etc.  The Company owns or possesses all
licenses, permits, franchises, authorizations, patents, copyrights, proprietary
software, service marks, trademarks and trade names, or rights thereto, that,
individually or in the aggregate, are Material to its business as now being
conducted, without known conflict with the rights of others, except for those
conflicts that would not be reasonably expected to have a Material Adverse
Effect.
 
Section 5.12.       Compliance with ERISA.  (a) Each Plan, other than any
Multiemployer Plan, operated and administered by the Company or any ERISA
Affiliate and each Plan with which the Company or any ERISA Affiliate has a
relationship has been operated and administered in compliance with all
applicable laws except for such instances of noncompliance as have not resulted
in and would not reasonably be expected to result in a Material Adverse Effect. 
Neither the Company nor any ERISA Affiliate has incurred any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to “employee benefit plans” (as defined in Section 3 of ERISA), which
liability has resulted or would reasonably be expected to result in a Material
Adverse Effect, and no event, transaction or condition has occurred or exists
that could reasonably be expected to result in the incurrence of any such
liability by the Company or any ERISA Affiliate, or in the imposition of any
Lien on any of the rights, properties or assets of the Company or any ERISA
Affiliate, in either case pursuant to Title I or IV of ERISA or to Section
430(k) of the Code or to any such penalty or excise tax provisions under the
Code or federal law or Section 4068 of ERISA or by the granting of a security
interest in connection with the amendment of a Plan, other than such liabilities
or Liens as would not be individually or in the aggregate Material.
 
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(b)         The present value of the aggregate benefit liabilities under each of
the Plans (other than Multiemployer Plans), determined as of the end of such
Plan’s most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan’s most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities by more than $10,000,000 in the aggregate
for all Plans.  The term “benefit liabilities” has the meaning specified in
Section 4001 of ERISA and the terms “current value” and “present value” have the
meanings specified in Section 3 of ERISA.
 
(c)          The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
Section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
 
(d)        The expected postretirement benefit obligation (determined as of the
last day of the Company’s most recently ended fiscal year in accordance with
Financial Accounting Standards Board Accounting Standards Codification Topic
715‑60, without regard to liabilities attributable to continuation coverage
mandated by Section 4980B of the Code) of the Company is not Material.
 
(e)          The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction that is subject to
the prohibitions of Section 406 of ERISA or in connection with which a tax could
be imposed pursuant to Section 4975(c)(1)(A)‑(D) of the Code.  The
representation by the Company to each Purchaser in the first sentence of this
Section 5.12(e) is made in reliance upon and subject to the accuracy of such
Purchaser’s representation in Section 6.2 as to the sources of the funds to be
used to pay the purchase price of the Notes to be purchased by such Purchaser.
 
Section 5.13.        Private Offering by the Company.  Neither the Company nor
anyone acting on the Company’s behalf has offered the Notes or any similar
securities for sale to, or solicited any offer to buy any of the same from, or
otherwise approached or negotiated in respect thereof with, any Person other
than not more than fifty-five (55) Institutional Investors, including the
Purchasers, each of which has been offered the Notes in connection with a
private sale for investment.  Neither the Company nor anyone acting on its
behalf has taken, or will take, any action that would subject the issuance or
sale of the Notes to the registration requirements of Section 5 of the
Securities Act or to the registration requirements of any securities or blue sky
laws of any applicable jurisdiction.
 
Section 5.14.        Use of Proceeds; Margin Regulations.  The Company will use
the proceeds of the sale of the Notes to repay debt, including amounts
outstanding under its term loan credit agreement and for general corporate
purposes, and in compliance with all laws referenced in Section 5.16.  No part
of the proceeds from the sale of the Notes hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(12 CFR 221), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Company in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220).  Margin stock does not
constitute more than 1% of the value of the assets of the Company, and the
Company does not have any present intention that margin stock will constitute
more than 1% of the value of such assets.  As used in this Section, the terms
“margin stock” and “purpose of buying or carrying” shall have the meanings
assigned to them in said Regulation U. 
 
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Section 5.15.       Existing Indebtedness.  (a) Except as described therein,
Schedule 5.15(a) sets forth a complete and correct list of all outstanding
Indebtedness of the Company as of March 31, 2020 (including a description of the
obligors and obligees, principal amount outstanding and collateral therefor, if
any, and guaranty thereof, if any), since which date there has been no Material
change in the amounts, interest rates, sinking funds, installment payments or
maturities of the Indebtedness of the Company.  The Company is not in default
and no waiver of default is currently in effect, in the payment of any principal
or interest on any Indebtedness of the Company, and no event or condition exists
with respect to any Indebtedness of the Company, that would permit (or that with
notice or the lapse of time, or both, would permit) one or more Persons to cause
such Indebtedness to become due and payable before its stated maturity or before
its regularly scheduled dates of payment.
 
(b)          Except as disclosed in Schedule 5.15(b), the Company has not agreed
or consented to cause or permit in the future (upon the happening of a
contingency or otherwise) any of its property, whether now owned or hereafter
acquired, to be subject to a Lien not permitted by the Mortgage.
 
(c)          The Company is not a party to, or otherwise subject to any
provision contained in, any instrument evidencing Indebtedness of the Company,
any agreement relating thereto or any other agreement (including, but not
limited to, its charter or other organizational document) which limits the
amount of, or otherwise imposes restrictions on the incurring of, Indebtedness
of the Company, except as specifically indicated in Schedule 5.15(c).
 
Section 5.16.        Foreign Assets Control Regulations, Etc.  (a)  Neither the
Company nor any Controlled Entity (i) is a Blocked Person, (ii) has been
notified that its name appears or may in the future appear on a State Sanctions
List or (iii) has been notified that it is a target of sanctions that have been
imposed by the United Nations or the European Union.
 
(b)          Neither the Company nor any Controlled Entity (i) has, to the
Company’s knowledge, violated, been found in violation of, or been charged or
convicted under, any applicable U.S. Economic Sanctions Laws, Anti‑Money
Laundering Laws or Anti‑Corruption Laws or (ii) to the Company’s knowledge, is
under investigation by any Governmental Authority for possible violation of any
U.S. Economic Sanctions Laws, Anti‑Money Laundering Laws or Anti‑Corruption
Laws.
 
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(c)          No part of the proceeds from the sale of the Notes hereunder:
 
(i)          constitutes or will constitute funds obtained on behalf of any
Blocked Person or will otherwise be used by the Company or any Controlled
Entity, directly or indirectly, (A) in connection with any investment in, or any
transactions or dealings with, any Blocked Person, (B) for any purpose that
would cause any Purchaser to be in violation of any U.S. Economic Sanctions Laws
or (C) otherwise in violation of any U.S. Economic Sanctions Laws;
 
(ii)          will be used, directly or indirectly, in violation of, or cause
any Purchaser to be in violation of, any applicable Anti‑Money Laundering Laws;
or
 
(iii)         will be used, directly or indirectly, for the purpose of making
any improper payments, including bribes, to any official of a Governmental
Authority or commercial counterparty in order to obtain, retain or direct
business or obtain any improper advantage, in each case which would be in
violation of, or cause any Purchaser to be in violation of, any applicable
Anti‑Corruption Laws.
 
(d)         The Company has established procedures and controls which it
reasonably believes are adequate (and otherwise comply with applicable law) to
ensure that the Company and each Controlled Entity is and will continue to be in
compliance with all applicable U.S. Economic Sanctions Laws, Anti‑Money
Laundering Laws and Anti‑Corruption Laws.
 
Section 5.17.        Status under Certain Statutes.  The Company is not subject
to regulation under the Investment Company Act of 1940, as amended, the Public
Utility Holding Company Act of 2005, as amended, the ICC Termination Act of
1995, as amended, nor is the Company subject to rate regulation under the
Federal Power Act, as amended.
 
Section 5.18.        Environmental Matters.  (a) The Company has no knowledge of
any liability, has not received any notice of any liability, and no proceeding
has been instituted raising any liability against the Company or any of its real
properties or other assets now or formerly owned, leased or operated by the
Company, alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as would not reasonably be
expected to result in a Material Adverse Effect.
 
(b)          The Company has no knowledge of any facts which would give rise to
any liability, public or private, for violation of Environmental Laws or damage
to the environment emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by the Company or to other
assets or their use, except, in each case, such as would not reasonably be
expected to result in a Material Adverse Effect.
 
(c)          The Company has not stored any Hazardous Materials on real
properties now or formerly owned, leased or operated by it nor has it disposed
of any Hazardous Materials in each case in a manner contrary to any
Environmental Laws that would reasonably be expected to result in a Material
Adverse Effect.
 
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(d)          All buildings on all real properties now owned, leased or operated
by the Company are in compliance with applicable Environmental Laws, except
where failure to comply would not reasonably be expected to result in a Material
Adverse Effect.
 
Section 5.19.      Lien of Mortgage.  The Mortgage constitutes a direct and
valid Lien upon all of the properties and assets of the Company specifically or
generally described or referred to in the Mortgage as being subject to the Lien
thereof, subject only to Permitted Encumbrances, and will create a similar Lien
upon all properties and assets acquired by the Company after the date hereof
which are required to be subjected to the Lien of the Mortgage, when acquired by
the Company, subject only to the exceptions referred to in the Mortgage and
Permitted Encumbrances, and subject, further to the recordation of a supplement
to the Mortgage describing such after‑acquired property; the descriptions of all
such properties and assets contained in the granting clauses of the Mortgage are
correct and adequate for the purposes of the Mortgage; and the Original Mortgage
has been duly recorded, and the Second Supplement, within three (3) Business
Days following the First Closing, will be duly submitted for recording as a
mortgage and deed of trust of real estate, and any required filings with respect
to personal property and fixtures subject to the Lien of the Mortgage have been
duly made in each place in which such recording or filing is required to
protect, preserve and perfect the Lien of the Mortgage; and all taxes and
recording and filing fees required to be paid with respect to the execution,
recording or filing of the Original Mortgage, the filing of financing statements
related thereto and similar documents and the issuance of the Notes have been
paid or with respect to the Second Supplement, will be, paid.  The Original
Mortgage has been recorded, and the Second Supplement, within three (3) Business
Days following the First Closing, will be duly submitted for recording in the
real estate recording office in each county listed on Schedule 4.11, which
counties collectively include all counties where the Company owns property
subject to the Lien of the Mortgage.
 
Section 5.20.        Filings under Indenture.  No action, including any filing,
registration, notice or approval, is necessary or advisable in New Jersey, New
York or any other jurisdiction to establish or protect for the benefit of the
Trustee and the Holders of Notes that the Notes are secured by the Pledged
Mortgage Bond, other than recording the Second Supplement in the counties in New
Jersey referred to therein.
 
Section 5.21.        Status of Certain Material Agreements.  No amendment,
modification, supplement or other change has been made to the Mortgage since the
Second Supplement. 
 
Section 6.            Representations of the Purchasers.
 
Section 6.1.          Purchase for Investment.  Each Purchaser severally
represents that it is purchasing the Notes for its own account or for one or
more separate accounts maintained by such Purchaser or for the account of one or
more pension or trust funds and not with a view to the distribution thereof,
provided that the disposition of the property of such Purchaser or such pension
or trust fund shall at all times be within the control of such Purchaser or such
pension or trust fund.  Each Purchaser understands that the Notes have not been
registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where neither such
registration nor such an exemption is required by law, and that the Company is
not required to register the Notes.  Each Purchaser understands that the Notes
are being offered and sold in reliance upon specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying upon the truth and accuracy of the representations,
warranties, agreements, acknowledgements and understandings set forth herein in
order to determine the applicability of such exemptions and the suitability of
such Purchaser to acquire the Notes. 
 
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Section 6.2.          Source of Funds.  Each Purchaser severally represents that
at least one of the following statements is an accurate representation as to
each source of funds (a “Source”) to be used by such Purchaser to pay the
purchase price of the Notes to be purchased by such Purchaser hereunder:
 
(a)          the Source is an “insurance company general account” (as the term
is defined in the United States Department of Labor’s Prohibited Transaction
Exemption (“PTE”) 95‑60) in respect of which the reserves and liabilities (as
defined by the annual statement for life insurance companies approved by the
NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by
or on behalf of any employee benefit plan together with the amount of the
reserves and liabilities for the general account contract(s) held by or on
behalf of any other employee benefit plans maintained by the same employer (or
affiliate thereof as defined in PTE 95‑60) or by the same employee organization
in the general account do not exceed 10% of the total reserves and liabilities
of the general account (exclusive of separate account liabilities) plus surplus
as set forth in the NAIC Annual Statement filed with such Purchaser’s state of
domicile; or
 
(b)         the Source is a separate account that is maintained solely in
connection with such Purchaser’s fixed contractual obligations under which the
amounts payable, or credited, to any employee benefit plan (or its related
trust) that has any interest in such separate account (or to any participant or
beneficiary of such plan (including any annuitant)) are not affected in any
manner by the investment performance of the separate account; or
 
(c)         the Source is either (i) an “insurance company pooled separate
account,” (within the meaning of PTE 90‑1) or (ii) a “bank collective investment
fund” (within the meaning of PTE 91‑38) and, except as disclosed by such
Purchaser to the Company in writing pursuant to this clause (c), no employee
benefit plan or group of plans maintained by the same employer or employee
organization beneficially owns more than 10% of all assets allocated to such
pooled separate account or collective investment fund; or
 
(d)         the Source constitutes assets of an “investment fund” (within the
meaning of Part VI of PTE 84‑14 (the “QPAM Exemption”)) managed by a “qualified
professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM
Exemption); no employee benefit plan’s assets that are managed by the QPAM in
such investment fund, when combined with the assets of all other employee
benefit plans established or maintained by the same employer or by an
“affiliate” (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such
employer or by the same employee organization and managed by such QPAM,
represent more than 20% of the total client assets managed by such QPAM; the
conditions of Part I(c) and (g) of the QPAM Exemption are satisfied; neither the
QPAM nor a Person controlling or controlled by the QPAM maintains an ownership
interest in the Company that would cause the QPAM and the Company to be
“related” within the meaning of Part VI(h) of the QPAM Exemption and (i) the
identity of such QPAM and (ii) the names of any employee benefit plans whose
assets in the investment fund, when combined with the assets of all other
employee benefit plans established or maintained by the same employer or by an
affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such
employer or by the same employee organization, represent 10% or more of the
assets of such investment fund, have been disclosed to the Company in writing
pursuant to this clause (d); or
 
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(e)          the Source constitutes assets of a “plan(s)” (within the meaning of
Part IV(h) of PTE 96‑23 (the “INHAM Exemption”)) managed by an “in‑house asset
manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption);
the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied;
neither the INHAM nor a Person controlling or controlled by the INHAM (applying
the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10%
or more interest in the Company and (i) the identity of such INHAM and (ii) the
name(s) of the employee benefit plan(s) whose assets constitute the Source have
been disclosed to the Company in writing pursuant to this clause (e); or
 
(f)           the Source is a governmental plan; or
 
(g)          the Source is one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans, each of
which has been identified to the Company in writing pursuant to this clause (g);
or
 
(h)          the Source does not include “plan assets” of any employee benefit
plan, other than a plan exempt from the coverage of Title I of ERISA.
 
As used in this Section 6.2, the terms “employee benefit plan,” “governmental
plan,” and “separate account” shall have the respective meanings assigned to
such terms in Section 3 of ERISA.
 
Section 6.3.          Purchaser Status; Experience. Each Purchaser separately
represents that such Purchaser is, and on the date of the applicable Closing
will be, an “accredited investor” as defined in Rule 501(a) under the Securities
Act.  Such Purchaser, either alone or together with its representatives, has
such knowledge, sophistication and experience in business and financial matters
so as to be capable of evaluating the merits and risks of the prospective
investment in the Notes, and has so evaluated the merits and risks of such
investment.  Such Purchaser is able to bear the economic risk of an investment
in the Notes and is able to afford a complete loss of such investment.
 
Section 6.4.        Access to Information.  Each Purchaser separately
acknowledges that such Purchaser has reviewed the Disclosure Documents and has
been afforded (a) the opportunity to ask such questions as it has deemed
necessary of, and to receive answers from, representatives of the Company
concerning the terms and conditions of the offering of the Notes and the risks
of investing in the Notes; (b) access to information about the Company and its
financial condition, results of operations, business, properties, management and
prospects sufficient to enable it to evaluate its investment; and (c) the
opportunity to obtain such additional information that the Company possesses or
can acquire without unreasonable effort or expense that is necessary to make an
informed investment decision with respect to the investment.
 
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Section 7.           Information as to Company.
 
Section 7.1.          Financial and Business Information.  The Company shall
deliver to each Purchaser and each Holder of a Note that is an Institutional
Investor:
 
(a)          Quarterly Statements — within 60 days after the end of each
quarterly fiscal period in each fiscal year of the Company (other than the last
quarterly fiscal period of each such fiscal year), duplicate copies of:
 
(i)           a consolidated balance sheet of the Company and its Subsidiaries
as at the end of such quarter, and
 
(ii)          consolidated statements of income and changes in cash flows of the
Company and its Subsidiaries, for such quarter and (in the case of the second
and third quarters) for the portion of the fiscal year ending with such quarter,
 
setting forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally, and
certified by a Senior Financial Officer as fairly presenting, in all material
respects, the financial position of the companies being reported on and their
results of operations and cash flows, subject to changes resulting from year‑end
adjustments;  provided that delivery within the time period specified above of
copies of the Company’s Form 10‑Q prepared in compliance with the requirements
therefor and filed with the SEC shall be deemed to satisfy the requirements of
this Section 7.1(a); and provided, further, that the Company shall be deemed to
have made such delivery of such Form 10‑Q if it shall have timely made such Form
10‑Q available on “EDGAR” or on, or through a link on, the website of the
Company or its parent, South Jersey Industries, Inc., and shall have given each
Institutional Investor prior notice of such availability on EDGAR or on or
through the website of the Company or its parent in connection with each
delivery (such availability and notice thereof being referred to as “Electronic
Delivery”);
 
(b)          Annual Statements — within 120 days after the end of each fiscal
year of the Company, duplicate copies of:
 
(i)           a consolidated balance sheet of the Company and its Subsidiaries,
as at the end of such year, and
 
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(ii)         consolidated statements of income and changes in cash flows and of
the Company and its Subsidiaries for such year,
 
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied by an opinion thereon of independent public accountants of
recognized national standing, which opinion shall state that such financial
statements present fairly, in all material respects, the financial position of
the companies being reported upon and their results of operations and cash flows
and have been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, provided that
the delivery within the time period specified above of the Company’s Annual
Report on Form 10‑K for such fiscal year (together with the Company’s annual
report to shareholders, if any, prepared pursuant to Rule 14a‑3 under the
Exchange Act) prepared in accordance with the requirements therefor and filed
with the SEC shall be deemed to satisfy the requirements of this Section 7.1(b),
and provided, further, that the Company shall be deemed to have made such
delivery of such Form 10‑K if it shall have timely made Electronic Delivery
thereof;
 
(c)         SEC and Other Reports — except for the filings referred to in
Section 7.1(a) and (b) above, promptly upon their becoming available and, to the
extent applicable, one copy of (i) each financial statement, report, notice or
proxy statement sent by the Company or any Subsidiary to public securities
holders generally, and (ii) each regular or periodic report, each registration
statement (without exhibits except as expressly requested by such Institutional
Investor), and each prospectus and all amendments thereto filed by the Company
or any Subsidiary with the SEC and of all press releases and other statements
made available generally by the Company or any Subsidiary to the public
concerning developments that are Material, provided that the Company shall be
deemed to have made such delivery of such information if it shall have timely
made Electronic Delivery thereof;
 
(d)         Notice of Default or Event of Default — promptly, and in any event
within five Business Days after a Responsible Officer becomes aware of the
existence of any Default or Event of Default or that any Person has given any
notice or taken any action with respect to a claimed default hereunder or that
any Person has given any notice or taken any action with respect to a claimed
default of the type referred to in Section 11(f) hereof, a written notice
specifying the nature and period of existence thereof and what action the
Company is taking or proposes to take with respect thereto;
 
(e)          ERISA Matters — promptly, and in any event within ten Business Days
after a Responsible Officer becomes aware of any of the following, a written
notice setting forth the nature thereof and the action, if any, that the Company
or an ERISA Affiliate proposes to take with respect thereto:
 
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(i)          with respect to any Plan (other than any Multiemployer Plan) that
is subject to Title IV of ERISA, any reportable event, as defined in Section
4043(c) of ERISA and the regulations thereunder, for which notice thereof has
not been waived pursuant to such regulations as in effect on the date hereof and
on the date of the Second Closing; or

(ii)        the taking by the PBGC of steps to institute, or the threatening by
the PBGC of the institution of, proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any such Plan, or
the receipt by the Company or any ERISA Affiliate of a notice from a
Multiemployer Plan that such action has been taken by the PBGC with respect to
such Multiemployer Plan; or
 
(iii)        any event, transaction or condition that could result in the
incurrence of any liability by the Company or any ERISA Affiliate pursuant to
Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans, or in the imposition of any Lien on any of
the rights, properties or assets of the Company or any ERISA Affiliate pursuant
to Title I or IV of ERISA or such penalty or excise tax provisions, if such
liability or Lien, taken together with any other such liabilities or Liens then
existing, would reasonably be expected to have a Material Adverse Effect;
 
(f)          Supplemental Indentures — promptly, and in any event within five
days after the execution and delivery thereof, a copy of any supplement to the
Indenture or the Mortgage that the Company from time to time may hereafter
execute and deliver which amends the Indenture or the Mortgage in any material
respect; and
 
(g)         Requested Information — with reasonable promptness, such other data
and information relating to the business, operations, affairs, financial
condition, assets or properties of the Company or any of its Subsidiaries or
relating to the ability of the Company to perform its obligations hereunder and
under the Notes as from time to time may be reasonably requested by any Holder
of a Note that is an Institutional Investor or such information regarding the
Company required to satisfy the requirements of 17 CFR §230.144A, as amended
from time to time, in connection with any contemplated transfer of the Notes.
 
Section 7.2.          Officer’s Certificate.  Each set of financial statements
delivered to a Purchaser or a Holder of a Note that is an Institutional Investor
pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a
certificate of a Senior Financial Officer setting forth:
 
(a)          Covenant Compliance — (i) the information (including detailed
calculations) required in order to establish whether the Company was in
compliance with the requirements of the Indenture and the Mortgage during the
quarterly or annual period covered by the statements then being furnished to the
extent required to be provided under the Indenture or the Mortgage; (ii) to the
extent the Company issued Additional Obligations under the Indenture or the
Mortgage during the period covered by the statements being furnished, any
calculations that the Company provided to the Trustee or the Mortgage Trustee to
show compliance with the Indenture or the Mortgage in connection with the
issuance of the Additional Obligations (including with respect to each such
Section, where applicable, the calculations of the maximum or minimum amount,
ratio or percentage, as the case may be, permissible under the terms of such
Sections, and the calculation of the amount, ratio or percentage then in
existence).
 
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(b)          Event of Default – a statement that such Senior Financial Officer
has reviewed the relevant terms hereof and of the Indenture and the Mortgage and
has made, or caused to be made, under his or her supervision, a review of the
transactions and conditions of the Company and its Subsidiaries from the
beginning of the quarterly or annual period covered by the statements then being
furnished to the date of the certificate and that such review shall not have
disclosed the existence during such period of any condition or event that
constitutes a Default or an Event of Default under either the Indenture or the
Mortgage or, if any such condition or event existed or exists, specifying the
nature and period of existence thereof and what action the Company shall have
taken or proposes to take with respect thereto.
 
Section 7.3.          Visitation.  The Company shall permit the representatives
of each Purchaser and each Holder of a Note that is an Institutional Investor:
 
(a)          No Default – if no Default or Event of Default then exists, at the
expense of such Institutional Investor and upon reasonable prior notice to the
Company, to visit the principal executive office of the Company, to discuss the
affairs, finances and accounts of the Company and its Subsidiaries with the
Company’s officers to the extent they are reasonably available, and, with the
consent of the Company (which consent will not be unreasonably withheld), to
visit the other offices and properties of the Company and each Subsidiary, all
at such reasonable times and as often as may be reasonably requested in writing;
and
 
(b)          Default – if a Default or Event of Default then exists and is
continuing, at the expense of the Company to visit and inspect any of the
offices or properties of the Company or any Subsidiary, to examine all their
respective books of account, records, reports and other papers, to make copies
and extracts therefrom, and to discuss their respective affairs, finances and
accounts with their respective officers and independent public accountants (and
by this provision the Company authorizes said accountants to discuss the
affairs, finances and accounts of the Company and its Subsidiaries), all at such
times and as often as may be reasonably requested.
 
Section 8.          Payment and Prepayment of the Notes.
 
Section 8.1.          Maturity .
 
(a)          As provided therein, the entire unpaid principal balance of each
Tranche A Note shall be due and payable on the maturity date thereof. 
 
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(b)          As provided therein, the entire unpaid principal balance of each
Tranche B Note shall be due and payable on the maturity date thereof. 
 
(c)          As provided therein, the entire unpaid principal balance of each
Tranche C Note shall be due and payable on the maturity date thereof. 
 
Section 8.2.          Optional Prepayments with Make‑Whole Amount.  The Company
may, at its option, upon notice as provided below, prepay at any time all, or
from time to time any part of, the Notes, in an amount not less than 5% of the
aggregate principal amount of the Notes then outstanding in the case of a
partial prepayment, at 100% of the principal amount so prepaid, together with
interest accrued thereon to the date of such prepayment, plus the Make‑Whole
Amount determined for the prepayment date with respect to such principal amount
of each Note that is then being so prepaid.  The Company will give each Holder
of Notes written notice of each optional prepayment under this Section 8.2 not
less than 30 days and not more than 60 days prior to the date fixed for such
prepayment, unless the Company and the Required Holders agree to another time
period pursuant to Section 16.  Each such notice shall specify such date (which
shall be a Business Day), the aggregate principal amount of the Notes to be
prepaid on such date, the principal amount of each Note held by such Holder to
be prepaid (determined in accordance with Section 8.3), and any other
information required to be delivered under the terms of the Indenture or the
Mortgage, and the interest to be paid on the prepayment date with respect to
such principal amount being prepaid, and shall be accompanied by a certificate
of a Senior Financial Officer as to the estimated Make‑Whole Amount due in
connection with such prepayment (calculated as if the date of such notice were
the date of the prepayment), setting forth the details of such computation.  Two
Business Days prior to such prepayment, the Company shall deliver to each Holder
of Notes a certificate of a Senior Financial Officer specifying the calculation
of such Make‑Whole Amount as of the specified prepayment date.
 
Section 8.3.         Allocation of Partial Prepayments.  In the case of each
partial prepayment of the Notes, the principal amount of the Notes to be prepaid
shall be allocated among all of the Notes at the time outstanding in proportion,
as nearly as practicable, to the respective unpaid principal amounts thereof. 
 
Section 8.4.         Maturity; Surrender, Etc.  In the case of each prepayment
of Notes pursuant to this Section 8, the principal amount of each Note to be
prepaid shall mature and become due and payable on the date fixed for such
prepayment (which shall be a Business Day), together with interest on such
principal amount accrued to such date and the applicable Make‑Whole Amount, if
any.  From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Make‑Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue.  Any Note paid or prepaid in full shall be surrendered to the
Company and cancelled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
 
Section 8.5.          Purchase of Notes.  The Company will not and will not
permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly
or indirectly, any of the outstanding Notes except (a) upon the payment or
prepayment of the Notes in accordance with the terms of this Agreement and the
Notes or (b) pursuant to a written offer to purchase any outstanding Notes made
by the Company or an Affiliate pro rata to the Holders of the Notes upon the
same terms and conditions.  The Company will promptly cancel all Notes acquired
by it or any Affiliate pursuant to any payment, prepayment or purchase of Notes
pursuant to any provision of this Agreement and no Notes may be issued in
substitution or exchange for any such Notes.
 
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Section 8.6.          Make‑Whole Amount for the Notes.  The term “Make‑Whole
Amount” means, with respect to any Note, an amount equal to the excess, if any,
of the Discounted Value of the Remaining Scheduled Payments with respect to the
Called Principal of such Note over the amount of such Called Principal, provided
that the Make‑Whole Amount may in no event be less than zero.  For the purposes
of determining the Make‑Whole Amount, the following terms have the following
meanings:
 
“Called Principal” means, with respect to any Note, the principal of such Note
that is to be prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1 or any other Financing
Agreement, as the context requires.
 
“Discounted Value” means, with respect to the Called Principal of any Note, the
amount obtained by discounting all Remaining Scheduled Payments with respect to
such Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes of such Tranche is
payable) equal to the Reinvestment Yield with respect to such Called Principal.
 
“Reinvestment Yield” means, with respect to the Called Principal of any Note,
0.50% plus the yield to maturity implied by the yield(s) reported as of 10:00
a.m. (New York City time) on the second Business Day preceding the Settlement
Date with respect to such Called Principal, on the display designated as “Page
PX1” (or such other display as may replace Page PX1) on Bloomberg Financial
Markets for the most recently issued actively traded on‑the‑run U.S. Treasury
securities (“Reported”) having a maturity equal to the Remaining Average Life of
such Called Principal as of such Settlement Date.  If there are no such U.S.
Treasury securities Reported having a maturity equal to such Remaining Average
Life, then such implied yield to maturity will be determined by (a) converting
U.S. Treasury bill quotations to bond equivalent yields in accordance with
accepted financial practice and (b) interpolating linearly between the yields
Reported for the applicable most recently issued actively traded on‑the‑run U.S.
Treasury securities with the maturities (1) closest to and greater than such
Remaining Average Life and (2) closest to and less than such Remaining Average
Life.  The Reinvestment Yield shall be rounded to the number of decimal places
as appears in the interest rate of the Note. 
 
If such yields are not Reported or the yields Reported as of such time are not
ascertainable (including by way of interpolation), then “Reinvestment Yield”
means, with respect to the Called Principal of any Note, 0.50% plus the yield to
maturity implied by the U.S. Treasury constant maturity yields reported, for the
latest day for which such yields have been so reported as of the second Business
Day preceding the Settlement Date with respect to such Called Principal, in
Federal Reserve Statistical Release H.15 (or any comparable successor
publication) for the U.S. Treasury constant maturity having a term equal to the
Remaining Average Life of such Called Principal as of such Settlement Date.  If
there is no such U.S. Treasury constant maturity having a term equal to such
Remaining Average Life, such implied yield to maturity will be determined by
interpolating linearly between (1) the U.S. Treasury constant maturity so
reported with the term closest to and greater than such Remaining Average Life
and (2) the U.S. Treasury constant maturity so reported with the term closest to
and less than such Remaining Average Life.  The Reinvestment Yield shall be
rounded to the number of decimal places as appears in the interest rate of the
Note.
 
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“Remaining Average Life” means, with respect to any Called Principal, the number
of years obtained by dividing (a) such Called Principal into (b) the sum of the
products obtained by multiplying (i) the principal component of each Remaining
Scheduled Payment with respect to such Called Principal by (ii) the number of
years, computed on the basis of a 360‑day year composed of twelve 30‑day months
and calculated to two decimal places, that will elapse between the Settlement
Date with respect to such Called Principal and the scheduled due date of such
Remaining Scheduled Payment.
 
“Remaining Scheduled Payments” means, with respect to the Called Principal of
any Note, all payments of such Called Principal and interest thereon that would
be due after the Settlement Date with respect to such Called Principal if no
payment of such Called Principal were made prior to its scheduled due date,
provided that if such Settlement Date is not a date on which interest payments
are due to be made under the Note, then the amount of the next succeeding
scheduled interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date pursuant to
Section 8.2 or Section 12.1, as the context requires.
 
“Settlement Date” means, with respect to the Called Principal of any Note, the
date on which such Called Principal is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to Section
12.1, as the context requires.
 
Section 8.7.          Change in Control.  
 
(a)          Notice of Change in Control. The Company will, within 15 Business
Days after any Responsible Officer has knowledge of the occurrence of any Change
in Control, give written notice of such Change in Control to each Holder of
Notes.  If a Change in Control has occurred, such notice shall contain and
constitute an offer to prepay the Notes as described in subparagraph (b) of this
Section 8.7 and shall be accompanied by the certificate described in
subparagraph (e) of this Section 8.7. 
 
(b)          Offer to Prepay Notes.  The offer to prepay Notes contemplated by
subparagraph (a) of this Section 8.7 shall be an offer to prepay, in accordance
with and subject to this Section 8.7, all, but not less than all, of the Notes
held by each holder (in this case only, “holder” in respect of any Note
registered in the name of a nominee for a disclosed beneficial owner shall mean
such beneficial owner) on a date specified in such offer (the “Proposed
Prepayment Date”).  If such Proposed Prepayment Date is in connection with an
offer contemplated by subparagraph (a) of this Section 8.7, such date shall be
not less than 20 days and not more than 45 days after the date of such offer (if
the Proposed Prepayment Date shall not be specified in such offer, the Proposed
Prepayment Date shall be the 30th day after the date of such offer).
 
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(c)          Acceptance; Rejection.  A Holder of Notes may accept the offer to
prepay made pursuant to this Section 8.7 by causing a notice of such acceptance
or rejection to be delivered to the Company at least five Business Days prior to
the Proposed Prepayment Date.  A failure by a Holder of Notes to respond to an
offer to prepay made pursuant to this Section 8.7 shall be deemed to constitute
a rejection of such offer by such Holder.
 
(d)          Prepayment.  Prepayment of the Notes to be prepaid pursuant to this
Section 8.7 shall be at 100% of the principal amount of such Notes, together
with interest on such Notes accrued to the date of prepayment.  The prepayment
shall be made on the Proposed Prepayment Date.
 
(e)          Officer’s Certificate. Each offer to prepay the Notes pursuant to
this Section 8.7 shall be accompanied by a certificate, executed by a Senior
Financial Officer of the Company and dated the date of such offer, specifying:
(i) the Proposed Prepayment Date; (ii) that such offer is made pursuant to this
Section 8.7; (iii) the principal amount of each Note offered to be prepaid; (iv)
the interest that would be due on each Note offered to be prepaid, accrued to
the Proposed Prepayment Date; (v) that the conditions of this Section 8.7 have
been fulfilled; and (vi) in reasonable detail, the nature and date or proposed
date of the Change in Control.
 
(f)          Effect on Required Payments.  The amount of each payment of the
principal of the Notes made pursuant to this Section 8.7 shall be applied
against and reduce each of the then remaining principal payments due on such
Notes pursuant to Section 8.1 by a percentage equal to the aggregate principal
amount of such Notes so paid divided by the aggregate principal amount of such
Notes outstanding immediately prior to such payment.
 
(g)          “Change in Control” Defined.  “Change in Control” means the
occurrence of one or more of the following events:
 
(i)           any sale, lease, exchange or other transfer (in a single
transaction or a series of related transactions) of all or substantially all of
the assets of the Company to any Person or “group” (within the meaning of the
Exchange Act and the rules of the SEC thereunder in effect on the date of the
First Closing), or
 
(ii)          the acquisition of ownership, directly or indirectly, beneficially
or of record, by any Person or “group” (within the meaning of the Exchange Act
and the rules of the SEC thereunder as in effect on the date of the First
Closing) of 50% or more of the outstanding ownership interests of the Company,
other than an acquisition by the Parent or any Subsidiary of the Parent of such
outstanding ownership interests of the Company.
 
Section 9.           Affirmative Covenants.
 
The Company covenants that so long as any of the Notes are outstanding:
 
Section 9.1.         Compliance with Law.  Without limiting Section 10.3, the
Company will, and will cause each of its Subsidiaries to, comply with all laws,
ordinances or governmental rules or regulations to which each of them is
subject, including, without limitation, ERISA, Environmental Laws, the USA
PATRIOT Act and the other laws and regulations that are referred to in Section
5.16, and will obtain and maintain in effect all licenses, certificates,
permits, franchises and other governmental authorizations necessary to the
ownership of their respective properties or to the conduct of their respective
businesses, in each case to the extent necessary to ensure that non‑compliance
with such laws, ordinances or governmental rules or regulations or failures to
obtain or maintain in effect such licenses, certificates, permits, franchises
and other governmental authorizations would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.
 
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Section 9.2.          Insurance.  The Company will and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co‑insurance and self‑insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.
 
Section 9.3.          Maintenance of Properties.  The Company will and will
cause each of its Subsidiaries to, maintain and keep, or cause to be maintained
and kept, their respective properties in good repair, working order and
condition (other than ordinary wear and tear), so that the business carried on
in connection therewith may be properly conducted at all times, provided that
this Section shall not prevent the Company nor any Subsidiary from discontinuing
the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
 
Section 9.4.          Payment of Taxes.  The Company will and will cause each of
its Subsidiaries to, file all income tax or similar tax returns required to be
filed in any jurisdiction and to pay and discharge all taxes shown to be due and
payable on such returns and all other taxes, assessments, governmental charges,
or levies payable by any of them, to the extent the same have become due and
payable and before they have become delinquent, provided that neither the
Company nor any Subsidiary need pay any such tax, assessment, charge or levy if
(a) the amount, applicability or validity thereof is contested by the Company or
such Subsidiary on a timely basis in good faith and in appropriate proceedings,
and the Company or a Subsidiary has established adequate reserves therefor in
accordance with GAAP on the books of the Company or such Subsidiary or (b) the
nonpayment of all such taxes, assessments, charges and levies in the aggregate
would not reasonably be expected to have a Material Adverse Effect.
 
Section 9.5.         Corporate Existence, Etc.  The Company will at all times
preserve and keep in full force and effect the corporate existence of each of
its Subsidiaries (unless merged into the Company or a wholly‑owned Subsidiary)
and all rights and franchises of its Subsidiaries unless, in the good faith
judgment of the Company or such Subsidiary, the termination of or failure to
preserve and keep in full force and effect such corporate existence, right or
franchise would not, individually or in the aggregate, have a Material Adverse
Effect.
 
Section 9.6.          Books and Records.  The Company will, and will cause each
of its Subsidiaries to, maintain proper books of record and account in
conformity with GAAP and all applicable requirements of any Governmental
Authority having legal or regulatory jurisdiction over the Company or such
Subsidiary, except where any such nonconformity would not reasonably be expected
to have a Material Adverse Effect.
 
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Section 9.7.         Compliance with Material Agreements.  The Company will
comply in all material respects with the material terms, conditions and
provisions of all Material agreements, except where such noncompliance would not
reasonably be expected to have a Material Adverse Effect.
 
Section 9.8.          Ownership.  The Parent will directly or indirectly own, at
all times, 100% of the Capital Stock having voting rights of the Company. 
 
Section 9.9.         Recording of the Second Supplement.  Within three (3)
Business Days following the date of the First Closing, the Company will duly
submit the Second Supplement for recording as a mortgage of real estate in each
county in which the Company owns real property.  The Company will pay all taxes
and recording or filing fees required to be paid with respect to the execution,
recording or filing of the Second Supplement.
 
Section 10.          Negative Covenants.
 
The Company covenants that so long as any of the Notes are outstanding:
 
Section 10.1.       Transactions with Affiliates.  The Company will not and will
not permit any Subsidiary to enter into directly or indirectly any Material
transaction or Material group of related transactions (including without
limitation the purchase, lease, sale or exchange of properties of any kind or
the rendering of any service) with any Affiliate (other than the Company or
another Subsidiary), except pursuant to the reasonable requirements of the
Company’s or such Subsidiary’s business and upon fair and reasonable terms no
less favorable to the Company or such Subsidiary than would be obtainable in a
comparable arm’s‑length transaction with a Person not an Affiliate.
 
Section 10.2.        Line of Business.  The Company will not engage in any
business if, as a result, the general nature of the business in which the
Company and its Subsidiaries, taken as a whole, would then be engaged would be
substantially changed from the general nature of the business in which the
Company is engaged on the date of this Agreement.
 
Section 10.3.       Terrorism Sanctions Regulations.  The Company will not and
will not permit any Controlled Entity (a) to become (including by virtue of
being owned or controlled by a Blocked Person), own or control a Blocked Person
or any Person that is the target of sanctions imposed by the United Nations or
by the European Union, or (b) directly or indirectly to have any investment in
or engage in any dealing or transaction (including, without limitation, any
investment, dealing or transaction involving the proceeds of the Notes) with any
Person if such investment, dealing or transaction (i) would cause any Purchaser
or any Holder of Notes to be in violation of or subject to sanctions under any
law or regulation applicable to such Purchaser or such Holder, or (ii) is
prohibited by or subject to sanctions under any U.S. Economic Sanctions, or (c)
to engage, nor shall any Affiliate of either engage, in any activity that could
subject such Person or any Purchaser or any Holder of Notes to sanctions under
CISADA or any similar law or regulation with respect to Iran or any other
country that is subject to U.S. Economic Sanctions. 
 
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Section 10.4.        Release of Lien of the Mortgage.  The Company will not
cause or permit the Lien of the Mortgage that secures any collateral thereunder
to be released without the prior written consent of each Holder of a Note, other
than as permitted under Sections 1.3(a), 4.4, 6.3, 6.5(a), 6.7, 10.4, 10.5, 10.6
or 13.4 or Articles VIII or IX of the Mortgage.  Notwithstanding the foregoing,
the Trustee may release a Pledged Mortgage Bond and the Mortgage Trustee may
release the Lien of the Mortgage, provided that, on the same date that such
Liens are released, the Trustee receives a substituted pledged bond or bonds
that are secured by the same collateral that secured such Pledged Mortgage Bond
immediately prior to its release and the release of the Mortgage pursuant to a
mortgage that is acceptable in scope, form and substance to the Required
Holders, such acceptance not to be unreasonably withheld or delayed, and the
Holders of Notes shall have received such opinions of counsel, certificates,
uniform commercial code searches and title searches that provide evidence that
the substituted pledged bonds are secured by a first priority Lien on the
collateral purported to be pledged as collateral to secure the substituted
pledged bond or bonds as the Required Holders shall reasonably request.
 
Section 10.5.        Tax Withholding.  Except as otherwise required by
applicable law, the Company agrees that it will not withhold from any applicable
payment to be made to a Holder of a Note that is not a United States Person any
tax so long as such Holder shall have delivered to the Company (in such number
of copies as shall be requested) on or about the date on which such Holder
becomes a Holder under this Agreement (and from time to time thereafter upon the
reasonable request of the Company), executed copies of IRS Form W-8BEN or IRS
Form W-8BEN-E (or any successor form), as applicable, as well as the applicable
“U.S. Tax Compliance Certificate” substantially in the form attached as Exhibit
10.5, in both cases correctly completed and executed.
 
Section 11.          Events of Default.
 
An “Event of Default” shall exist if any of the following conditions or events
shall occur and be continuing:
 
(a)          the Company defaults in the payment of any principal or Make‑Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or;
 
(b)          the Company defaults in the payment of any interest on any Note for
more than five Business Days after the same becomes due and payable; or
 
(c)         the occurrence of any “Event of Default” under Section 8.1(a) of the
Indenture (other than defaults described in Sections 8.1(a)(1) or 8.1(a)(2)) or
the occurrence of any “Event of Default” under Section 10.1 of the Mortgage
(other than defaults described in Section 10.1(a) or 10.1(b)); or
 
(d)          any representation or warranty made in writing by or on behalf of
the Company or by any officer of the Company in this Agreement, the Indenture,
the Mortgage or in any writing furnished in connection with the transactions
contemplated hereby, proves to have been false, incorrect or misleading in any
material respect on the date as of which made; or
 
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(e)          the Company defaults in the performance of or compliance with any
term contained herein (other than those referred to in paragraphs (a), (b) and
(c) of this Section 11) or in the Indenture or the Mortgage and such default is
not remedied, in the case of defaults hereunder, within 30 days after the
earlier of (i) a Responsible Officer obtaining actual knowledge of such default
and (ii) the Company receiving written notice of such default from any Holder of
a Note (any such written notice to be identified as a “notice of default” and to
refer specifically to this paragraph (e) of Section 11), and in the case of
defaults under either the Indenture or the Mortgage, within the grace period
specified for such defaults respectively in the Indenture and the Mortgage; or
 
(f)          (i) the Company or any Subsidiary is in default (as principal or as
guarantor or other surety) in the payment of any principal of or premium or
make‑whole amount or interest on any Indebtedness (other than the Notes and any
other notes or other debt instruments authenticated under the Indenture) that is
outstanding in an aggregate principal amount of at least $50,000,000 beyond any
period of grace provided with respect thereto, or (ii) the Company or any
Subsidiary is in default in the performance of or compliance with any term of
any instrument, mortgage, indenture or other agreement relating to any
Indebtedness (other than the Notes and any other notes or debt instruments
authenticated under the Indenture) in an aggregate principal amount of at least
$50,000,000 or any other condition exists, and as a consequence of such default
or condition such Indebtedness has become, or has been declared, due and
payable, or (iii) as a consequence of the occurrence or continuation of any
event or condition (other than the passage of time or the right of the holder of
Indebtedness to convert such Indebtedness into equity interests), the Company or
any Subsidiary has become obligated to purchase or repay Indebtedness (other
than the Notes and any other notes authenticated under the Indenture) before its
regular maturity or before its regularly scheduled dates of payment in an
aggregate outstanding principal amount of at least $50,000,000; or
 
(g)          a final judgment or judgments at any one time outstanding for the
payment of money aggregating in excess of $50,000,000 (except to the extent
covered by independent third‑party insurance as to which the insurer
acknowledges in writing that such judgment or judgments are covered by such
insurance) are rendered against one or more of the Company or any Subsidiary and
which judgments are not, within 30 days after entry thereof, bonded, discharged
or stayed pending appeal, or are not discharged within 30 days after the
expiration of such stay; or
 
(h)         if (i) any Plan shall fail to satisfy the minimum funding standards
of ERISA or the Code for any plan year or part thereof or a waiver of such
standards or extension of any amortization period is sought or granted under
Section 412 of the Code, (ii) a notice of intent to terminate any Plan shall
have been or is reasonably expected to be filed with the PBGC or the PBGC shall
have instituted proceedings under Section 4042 of ERISA to terminate or appoint
a trustee to administer any Plan or the PBGC shall have notified the Company or
any ERISA Affiliate that a Plan may become a subject of any such proceedings,
(iii) the aggregate “amount of unfunded benefit liabilities” (within the meaning
of Section 4001(a)(18) of ERISA) for which the Company or any ERISA Affiliate is
obligated under all Plans, determined in accordance with Title IV of ERISA,
shall exceed $50,000,000, (iv) the Company or any ERISA Affiliate shall have
incurred or is reasonably expected to incur any liability (other than for
premium payments due to the PBGC) pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee benefit plans,
(v) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, or
(vi) the Company or any Subsidiary establishes or amends any employee welfare
benefit plan that provides post‑employment welfare benefits in a manner that
could increase the liability of the Company or any Subsidiary thereunder;
provided that any such event or events described in clauses (i) through (vi)
above, either individually or together with any other such event or events,
would reasonably be expected to have a Material Adverse Effect.
 
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As used in Section 11(h), the terms “employee benefit plan” and “employee
welfare benefit plan” shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
 
Section 12.          Remedies on Default, Etc.
 
Section 12.1.        Acceleration.  (a) If an Event of Default has occurred with
respect to the Company in connection with an “Event of Default” under Sections
8.1(a)(6) or 8.1(a)(7) of the Indenture or an “Event of Default” under Sections
10.1(d) or 10.1(e) of the Mortgage, all of the Notes then outstanding shall
automatically become immediately due and payable.
 
(b)          If any other Event of Default has occurred and is continuing, any
Holder or Holders of more than 50% in aggregate principal amount of the Notes at
the time outstanding may at any time during the continuation of such Event of
Default, at its or their option, by notice or notices to the Company, declare
all of the Notes then outstanding to be immediately due and payable.
 
(c)          If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing with respect to any Notes, any Holder
or Holders of Notes at the time outstanding affected by such Event of Default
may at any time during the continuation of such Event of Default, at its or
their option, by notice or notices to the Company, declare all of the Notes held
by such Holder or Holders to be immediately due and payable.
 
Upon any Note’s becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Note will forthwith mature and the entire
unpaid principal amount of such Note, plus (i) all accrued and unpaid interest
thereon (including, but not limited to, interest accrued thereon at the Default
Rate) and (ii) the Make‑Whole Amount determined in respect of such principal
amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived.  The Company
acknowledges, and the parties hereto agree, that each Holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make‑Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.

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 Section 12.2.        Other Remedies.  If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become or
have been declared immediately due and payable under Section 12.1, the Holder of
any Note at the time outstanding may proceed to protect and enforce the rights
of such Holder by an action at law, suit in equity or other appropriate
proceeding, whether for the specific performance of any agreement contained
herein or in any Note, or for an injunction against a violation of any of the
terms hereof or thereof, or in aid of the exercise of any power granted hereby
or thereby or by law or otherwise.
 
Section 12.3.       Rescission.  At any time after any the Notes have been
declared due and payable pursuant to clause (b) or (c) of Section 12.1, the
Holders of more than 50% in aggregate principal amount of the Notes then
outstanding, by written notice to the Company, may rescind and annul any such
declaration and its consequences if (a) the Company has paid all overdue
interest on the Notes, all principal of and Make‑Whole Amount, if any, on any
Notes that are due and payable and are unpaid other than by reason of such
declaration, and all interest on such overdue principal and Make‑Whole Amount,
if any, and (to the extent permitted by applicable law) any overdue interest in
respect of the Notes, at the Default Rate, (b) neither the Company nor any other
Person shall have paid any amounts which have become due solely by reason of
such declaration, (c) all Events of Default and Defaults, other than non‑payment
of amounts that have become due solely by reason of such declaration, have been
cured or have been waived pursuant to Section 16, and (d) no judgment or decree
has been entered for the payment of any monies due pursuant hereto or to any
Notes.  No rescission and annulment under this Section 12.3 will extend to or
affect any subsequent Event of Default or Default or impair any right consequent
thereon.
 
Section 12.4.       No Waivers or Election of Remedies, Expenses, Etc.  No
course of dealing and no delay on the part of any Holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such Holder’s rights, powers or remedies.  No right, power
or remedy conferred by this Agreement or by any Note upon any Holder thereof
shall be exclusive of any other right, power or remedy referred to herein or
therein or now or hereafter available at law, in equity, by statute or
otherwise.  Without limiting the obligations of the Company under Section 14,
the Company will pay to the Holder of each Note on demand such further amount as
shall be sufficient to cover all reasonable costs and expenses of such Holder
incurred in any enforcement or collection under this Section 12, including,
without limitation, reasonable attorneys’ fees, expenses and disbursements.
 
Section 13.          Payments on Notes.
 
Section 13.1.        Home Office Payment.  So long as any Purchaser or its
nominee shall be the Holder of any Note, and notwithstanding anything contained
in the Indenture or in such Note to the contrary, the Company will pay all sums
becoming due on such Note for principal, Make‑Whole Amount or premium, if any,
and interest by the method and at the address specified for such purpose below
such Purchaser’s name in Schedule A, or by such other method or at such other
address as such Purchaser shall have from time to time specified to the Company
in writing for such purpose, without the presentation or surrender of such Note
or the making of any notation thereon, except that upon written request of the
Company made concurrently with or reasonably promptly after payment or
prepayment in full of any Note, such Purchaser shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Trustee at its
principal executive office or at the place of payment most recently designated
by the Trustee pursuant to the Indenture.  Prior to any sale or other
disposition of any Note held by a Purchaser or its nominee, such Purchaser will,
at its election, either endorse thereon the amount of principal paid thereon and
the last date to which interest has been paid thereon or surrender such Note to
the Company in exchange for a new Note or Notes pursuant to Section 2.6 of the
Indenture.  The Company will afford the benefits of this Section 13.1 to any
Institutional Investor that is the direct or indirect transferee of any Note
purchased by a Purchaser under this Agreement and that has made the same
agreement relating to such Note as the Purchasers have made in this Section
13.1. 
 
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Section 14.         Registration; Exchange; Expenses, Etc.
 
Section 14.1.        Registration of Notes.  The Company shall cause the Trustee
to keep a register for the registration of Notes and registration of transfers
of Notes in accordance with Section 2.6 of the Indenture. 
 
Section 14.2.       Transaction Expenses.  Whether or not the transactions
contemplated hereby are consummated, the Company will pay all reasonable costs
and expenses (including reasonable attorneys’ fees of one special counsel and,
if reasonably required by the Required Holders, one local or other counsel)
incurred (a) by the Purchasers in connection with such transactions, and (b) by
the Holders of the Notes in connection with any amendments, waivers or consents
under or in respect of any Financing Agreement (whether or not such amendment,
waiver or consent becomes effective), including, without limitation: (i) the
reasonable costs and expenses incurred in enforcing or defending (or determining
whether or how to enforce or defend) any rights under any Financing Agreement or
in responding to any subpoena or other legal process or informal investigative
demand issued in connection with any Financing Agreement, or by reason of being
a Holder of Notes, (ii) the reasonable costs and expenses, including financial
advisors’ fees, incurred in connection with the insolvency or bankruptcy of the
Company or any Subsidiary or in connection with any work‑out or restructuring of
the transactions contemplated  by any Financing Agreement and (iii) the
reasonable costs and expenses incurred in connection with the initial filing of
any Financing Agreement and all related documents and financial information with
the SVO, provided that such costs and expenses under this clause (iii) shall not
exceed $5,000 for the Notes.  The Company will pay, and will save each Purchaser
and each other Holder of a Note harmless from, all claims in respect of any
fees, costs or expenses if any, of brokers and finders (other than those, if
any, retained by a Purchaser or other Holder in connection with its purchase of
the Notes).
 
Section 14.3.        Survival.  The obligations of the Company under this
Section 14 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of any Financing Agreement, and the
termination of any Financing Agreement.
 
Section 15.          Survival of Representations and Warranties; Entire
Agreement.
 
All representations and warranties contained herein shall survive the execution
and delivery of the Financing Agreements, the purchase or transfer by any
Purchaser of any Note or portion thereof or interest therein and the payment of
any Note, and may be relied upon by any subsequent Holder of a Note, regardless
of any investigation made at any time by or on behalf of such Purchaser or any
other Holder of a Note.  All statements contained in any certificate or other
instrument delivered by or on behalf of the Company pursuant to this Agreement
shall be deemed representations and warranties of the Company under this
Agreement.  Subject to the preceding sentence, the Financing Agreements embody
the entire agreement and understanding between each Purchaser and the Company
and supersede all prior agreements and understandings relating to the subject
matter hereof.
 
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Section 16.          Amendment and Waiver.
 
Section 16.1.       Requirements.  The Company will not cause or permit the
Indenture to change the amount or time of any prepayment or payment of principal
of, or reduce the rate or change the time of payment or method of computation of
interest or of the Make‑Whole Amount, if any, on the Notes as set forth in the
Indenture and the Notes, without the written consent of the Holder of each Note
at the time outstanding affected thereby.  The Company will not cause or permit
the Mortgage or a Pledged Mortgage Bond to be amended to change the amount or
time of any prepayment or payment of principal of, or reduce the rate or change
the time of payment or method of computation of interest or of the Make‑Whole
Amount, if any, on such Pledged Mortgage Bond as set forth in the Mortgage and
the Pledged Mortgage Bond, without the written consent of the Holder of each
Note to which such Pledged Mortgage Bond relates.  This Agreement and the Notes
may be amended, and the observance of any term hereof or of the Notes may be
waived (either retroactively or prospectively), with (and only with) the written
consent of the Company and the Required Holders, except that (a) no amendment or
waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any
defined term, will be effective as to any Holder of Notes unless consented to by
such Holder of Notes in writing, and (b) no such amendment or waiver may,
without the written consent of all of the Purchasers and all of the Holders of
Notes at the time outstanding affected thereby, (i) subject to the provisions of
Section 12 relating to acceleration or rescission, change the amount or time of
any prepayment or payment of principal of, or reduce the rate or change the time
of payment or method of computation of interest (if such change results in a
decrease in the interest rate) or of the Make‑Whole Amount, if any, on, the
Notes, (ii) change the percentage of the principal amount of the Notes the
Holders of which are required to consent to any such amendment or waiver or the
principal amount of the Notes that the Purchasers are to purchase pursuant to
Section 2 upon the satisfaction of the conditions to Closing that appear in
Section 4, or (iii) amend any of Sections 8, 10.4, 11(a), 11(b), 12, 16 or 20.
 
Section 16.2.        Solicitation of Holders of Notes.
 
(a)          Solicitation.  The Company will provide each Purchaser and each
Holder of Notes (irrespective of the amount of Notes then owned by it) with
sufficient information, sufficiently far in advance of the date a decision is
required, to enable such Purchaser and such Holder to make an informed and
considered decision with respect to any proposed amendment, waiver or consent in
respect of any of the provisions hereof or of the Notes.  The Company will
deliver executed or true and correct copies of each amendment, waiver or consent
effected pursuant to the provisions of this Section 16 to each Purchaser and
each Holder of outstanding Notes promptly following the date on which it is
executed and delivered by, or receives the consent or approval of, the requisite
Purchasers or Holders of Notes.
 
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(b)          Payment.  The Company will not directly or indirectly pay or cause
to be paid any remuneration, whether by way of supplemental or additional
interest, fee or otherwise (other than legal fees or other related expenses), or
grant any security or provide other credit support, to any Purchaser or Holder
of Notes as consideration for or as an inducement to the entering into by such
Purchaser or Holder of Notes or any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or security is
concurrently granted or other credit support concurrently provided, on the same
terms, ratably to each Purchaser and Holder of Notes then outstanding even if
such Purchaser or Holder did not consent to such waiver or amendment.
 
(c)          Consent in Contemplation of Transfer.  Any consent made pursuant to
this Section 16.2 by the Holder of any Note that has transferred or has agreed
to transfer such Note to the Company, any Subsidiary or any Affiliate of the
Company and has provided or has agreed to provide such written consent as a
condition to such transfer shall be void and of no force or effect except solely
as to such Holder, and any amendments effected or waivers granted or to be
effected or granted that would not have been or would not be so effected or
granted but for such consent (and the consents of all other Holders of Notes
that were acquired under the same or similar conditions) shall be void and of no
force or effect except solely as to such transferring Holder.
 
Section 16.3.        Binding Effect, Etc.  Any amendment or waiver consented to
as provided in this Section 16 applies equally to all Purchasers and all Holders
of Notes and is binding upon them and upon each future Holder of any Note and
upon the Company without regard to whether such Note has been marked to indicate
such amendment or waiver.  No such amendment or waiver will extend to or affect
any obligation, covenant, agreement, Default or Event of Default not expressly
amended or waived or impair any right consequent thereon.  No course of dealing
between the Company and any Purchaser or the Holder of any Note nor any delay in
exercising any rights hereunder or under any Note shall operate as a waiver of
any rights of any Purchaser or any Holder of such Note.  As used herein, the
term “this Agreement” and references thereto shall mean this Note Purchase
Agreement as it may from time to time be amended or supplemented.
 
Section 16.4.        Notes Held by Company, Etc.  Solely for the purpose of
determining whether the Holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the Holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to
be outstanding.
 
Section 17.          Notices.
 
Except for Electronic Deliveries, all notices and communications provided for
hereunder shall be in writing and sent (a) by telecopy if the sender on the same
day sends a confirming copy of such notice by a recognized overnight delivery
service (charges prepaid), or (b) by registered or certified mail with return
receipt requested (postage prepaid), or (c) by a recognized overnight delivery
service (with charges prepaid).  Any such notice must be sent:
 
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(i)           if to any Purchaser or its nominee, to such Purchaser or nominee
at the address specified for such communications in Schedule A, or at such other
address as such Purchaser or nominee shall have specified to the Company in
writing;
 
(ii)          if to any other Holder of any Note, to such Holder at such address
as such Holder shall have specified to the Company in writing;
 
(iii)         if to the Company, to the Company at its address set forth at the
beginning hereof to the attention of Treasurer, or at such other address as the
Company shall have specified to the Holder of each Note in writing; or
 
(iv)         if to the Trustee, to The Bank of New York Mellon, as Trustee, c/o
The Bank of New York Mellon Trust Company, N.A., Attention: Corporate Trust, 525
William Penn Place, 38th Floor, Pittsburgh, PA 15259, or at such other address
as the Trustee shall have specified to the Company and each other party hereto
in writing.
 
Notices under this Section 17 will be deemed given only when actually received.
 
Section 18.          Indemnification.
 
The Company hereby agrees to indemnify and hold the Purchasers harmless from,
against and in respect of any and all loss, liability and reasonable expense
(including reasonable attorneys’ fees) arising from any misrepresentation or
nonfulfillment of any undertaking on the part of the Company under this
Agreement.  The indemnification obligations of the Company under this Section 18
shall survive the execution and delivery of this Agreement, the delivery of the
Notes to the Purchasers and the consummation of the transactions contemplated
herein.
 
Section 19.          Reproduction of Documents.
 
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser at the applicable Closing
(except the Notes themselves), and (c) financial statements, certificates and
other information previously or hereafter furnished to any Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, electronic,
digital, or other similar process and such Purchaser may destroy any original
document so reproduced.  The Company agrees and stipulates that, to the extent
permitted by applicable law, any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding
(whether or not the original is in existence and whether or not such
reproduction was made by such Purchaser in the regular course of business) and
any enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence.  This Section 19 shall not prohibit the
Company or any other Holder of Notes from contesting any such reproduction to
the same extent that it could contest the original, or from introducing evidence
to demonstrate the inaccuracy of any such reproduction.
 
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Section 20.          Confidential Information.
 
For the purposes of this Section 20, “Confidential Information” means
information delivered to any Purchaser or Holder of a Note by or on behalf of
the Company or any Subsidiary in connection with the transactions contemplated
by or otherwise pursuant to this Agreement or the Notes that is proprietary in
nature and that was clearly marked or labeled or otherwise adequately identified
when received by such Purchaser or Holder as being confidential information of
the Company or such Subsidiary, provided that such term does not include
information that (a) was publicly known or otherwise known to such Purchaser or
Holder prior to the time of such disclosure without an obligation of
confidentiality, (b) subsequently becomes publicly known through no act or
omission by such Purchaser or Holder or any person acting on such Purchaser’s or
Holder’s behalf, (c) otherwise becomes known to such Purchaser or Holder other
than through disclosure by the Company or any Subsidiary or (d) constitutes
financial statements delivered to such Purchaser or Holder under Section 7.1 of
this Agreement that are otherwise publicly available.  Each Purchaser and Holder
will maintain the confidentiality of such Confidential Information in accordance
with procedures adopted by such Purchaser or Holder in good faith to protect
confidential information of third parties delivered to such Purchaser or Holder
and shall use such information only for purposes of monitoring its investment in
the Notes, provided that such Purchaser or Holder may deliver or disclose
Confidential Information to (i) its directors, trustees, officers, employees,
agents, attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by the Notes and who
agree to hold confidential the Confidential Information substantially in
accordance with the terms of this Section 20), (ii) its financial advisors and
other professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20, (iii)
any other Holder of any Note, (iv) any Institutional Investor to which it sells
or offers to sell such Note or any part thereof or any participation therein (if
such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (v) any Person
from which it offers to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state or
provincial regulatory authority having jurisdiction over such Purchaser or
Holder, (vii) the NAIC or the SVO or, in each case, any similar organization, or
any nationally recognized rating agency that requires access to information
about such Purchaser’s or Holder’s investment portfolio, or (viii) any other
Person to which such delivery or disclosure may be necessary or appropriate (w)
to effect compliance with any law, rule, regulation or order applicable to such
Purchaser or Holder, (x) in response to any subpoena or other legal process, (y)
in connection with any litigation to which such Purchaser or Holder is a party
or (z) if an Event of Default has occurred and is continuing, to the extent such
Purchaser or Holder may reasonably determine such delivery and disclosure to be
necessary or appropriate in the enforcement or for the protection of the rights
and remedies under such Purchaser’s or Holder’s Notes and this Agreement.  Each
Holder of a Note, by its acceptance of a Note, will be deemed to have agreed to
be bound by and to be entitled to the benefits of this Section 20 as though it
were a party to this Agreement.  On reasonable request by the Company in
connection with the delivery to any Holder of a Note of information required to
be delivered to such Holder under this Agreement or requested by such Holder
(other than a Holder that is a party to this Agreement or its nominee), such
Holder will enter into an agreement with the Company embodying the provisions of
this Section 20.
 
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Section 21.          Miscellaneous.
 
Section 21.1.        Successors and Assigns.  All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent Holder of a Note) whether so expressed or
not; provided, however, the provisions of Section 7 hereof and any other
provision of this Agreement that relates only to Institutional Investors shall
only apply to Institutional Investors.
 
Section 21.2.      Accounting Terms.  All accounting terms used herein which are
not expressly defined in this Agreement have the meanings respectively given to
them in accordance with GAAP.  Except as otherwise specifically provided herein,
(a) all computations made pursuant to this Agreement shall be made in accordance
with GAAP, and (b) all financial statements shall be prepared in accordance with
GAAP.  For purposes of determining compliance with the covenants set out in any
Financing Agreement, any election by the Company to measure an item of
Indebtedness using fair value (as permitted by Accounting Standard Codification
Topic No. 825‑10‑25 – Recognition, subsection Fair Value Option or any similar
accounting standard) shall be disregarded and such determination shall be made
by valuing indebtedness at 100% of the outstanding principal thereof, unless
otherwise provided in such Financing Agreement.
 
Section 21.3.       Severability.  Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.
 
Section 21.4.        Construction, Etc.  Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant.  Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
 
For the avoidance of doubt, all Schedules and Exhibits attached to this
Agreement shall be deemed to be a part hereof.
 
Section 21.5.        Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be an original but all of which together
shall constitute one instrument.  Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.
 
Section 21.6.       Governing Law.  This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice‑of‑law principles of the law
of such State that would permit the application of the laws of a jurisdiction
other than such State.
 
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Section 21.7.        Jurisdiction and Process; Waiver of Jury Trial.  (a) The
Company irrevocably submits to the non‑exclusive jurisdiction of any New York
State or federal court sitting in the Borough of Manhattan, The City of New
York, over any suit, action or proceeding arising out of or relating to this
Agreement or the Notes.  To the fullest extent permitted by applicable law, the
Company irrevocably waives and agrees not to assert, by way of motion, as a
defense or otherwise, any claim that it is not subject to the jurisdiction of
any such court, any objection that it may now or hereafter have to the laying of
the venue of any such suit, action or proceeding brought in any such court and
any claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
 
(b)          The Company consents to process being served by or on behalf of any
Holder of Notes in any suit, action or proceeding of the nature referred to in
Section 21.7(a) by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, return receipt
requested, to it at its address specified in Section 17 or at such other address
of which such Holder shall then have been notified pursuant to said Section. 
The Company agrees that such service upon receipt (i) shall be deemed in every
respect effective service of process upon it in any such suit, action or
proceeding and (ii) shall, to the fullest extent permitted by applicable law, be
taken and held to be valid personal service upon and personal delivery to it. 
Notices hereunder shall be conclusively presumed to be received as evidenced by
a delivery receipt furnished by the United States Postal Service or any
reputable commercial delivery service.
 
(c)         Nothing in this Section 21.7 shall affect the right of any Holder of
a Note to serve process in any manner permitted by law, or limit any right that
the Holders of any of the Notes may have to bring proceedings against the
Company in the courts of any appropriate jurisdiction or to enforce in any
lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.
 
(d)          The parties hereto hereby waive trial by jury in any action brought
on or with respect to this Agreement, the Notes or any other document executed
in connection herewith or therewith.
 
Section 21.8.        Payments Due on Non‑Business Days.  Anything in this
Agreement or the Notes to the contrary notwithstanding (but without limiting the
requirement in Section 8.4 that the notice of any optional prepayment specify a
Business Day as the date fixed for such prepayment), any payment of principal of
or Make‑Whole Amount or interest on any Note that is due on a date other than a
Business Day shall be made on the next succeeding Business Day without including
the additional days elapsed in the computation of the interest payable on such
next succeeding Business Day; provided that if the maturity date of any Note is
a date other than a Business Day, the payment otherwise due on such maturity
date shall be made on the next succeeding Business Day and shall include the
additional days elapsed in the computation of interest payable on such next
succeeding Business Day.
 
Section 21.9.        Purchasers.  Notwithstanding anything to the contrary in
this Agreement, (a) in the event any Purchaser at the First Closing is, at any
time prior to the Second Closing, no longer a Holder of a Note and such
Purchaser is not listed as a Purchaser of a Tranche C Note in the Second
Closing, such Purchaser shall not be deemed to be a “Purchaser” for purposes of
Sections 7, 10 and 16, and (b) if at any time after the Second Closing, any
Purchaser shall cease being a Holder of a Note, then such Purchaser shall not be
deemed to be a “Purchaser” for purposes of Sections 7, 10 and 16
 
*   *   *   *   *

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If you are in agreement with the foregoing, please sign the form of agreement on
a counterpart of this Agreement and return it to the Company, whereupon this
Agreement shall become a binding agreement between you and the Company.

 
Very truly yours,
           
South Jersey Gas Company
           
By: 
/s/ Cielo Hernandez
     
Name:

Cielo Hernandez      
Title:

Treasurer  

-36-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
The Prudential Insurance Company of America
             
By:
/s/ Brian E. Lemons
     
Name:
Brian E. Lemons
     
Title: 
Vice President
             
Prudential Legacy Insurance Company of New Jersey
              By:
/s/ Brian E. Lemons
     
Name:
Brian E. Lemons
     
Title: 
Vice President
             
Farmers New World Life Insurance Company
             
By:
Prudential Private Placement Investors,
L.P. (as Investment Advisor)
             
By:
Prudential Private Placement Investors, Inc.
(as its General Partner)
              By:
/s/ Brian E. Lemons
     
Name: 
Brian E. Lemons
     
Title: 
Vice President
             
Health Options, Inc.
             
By:
Prudential Private Placement Investors,
L.P. (as Investment Advisor)
     

     
By:
Prudential Private Placement Investors, Inc.
(as its General Partner)
              By:
/s/ Brian E. Lemons
     
Name: 
Brian E. Lemons
     
Title: 
Vice President
 

-37-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
PAR U Hartford Life Insurance Comfort Trust
             
By:
Prudential Arizona Reinsurance Universal Company, as Grantor
             
By:
/s/ Brian E. Lemons
     
Name:
 Brian E. Lemons
     
Title: 
Vice President
             
Prudential Universal Reinsurance Company
             
By:
PGIM, Inc., as investment manager
             
By:
/s/ Brian E. Lemons
     
Name:
 Brian E. Lemons
     
Title:
 Vice President
 

-38-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Teachers Insurance and Annuity Association of America
              By:

Nuveen Alternatives Advisors LLC, its investment manager
             
By:

/s/  Matthew W. Smith
     
Name: 
Matthew W. Smith
     
Title: 
Senior Director
 

-39-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Metropolitan Life Insurance Company
   
by
MetLife Investment Management, LLC, Its Investment Manager
             
MetLife Insurance K.K.
   
by
MetLife Investment Management, LLC, Its Investment Manager
             
Metropolitan Tower Life Insurance Company
   
by
MetLife Investment Management, LLC, Its Investment Manager
             
Symetra Life Insurance Company
   
by
MetLife Investment Management, LLC, Its Investment Manager
             
Brighthouse Reinsurance Company of Delaware
    by

MetLife Investment Management, LLC, Its Investment Manager
             
American Fidelity Assurance Company
    by MetLife Investment Management, LLC, Its Investment Manager  

 
By:
/s/ John Wills
     
Name:
John Wills
     
Title:  
Authorized Signatory
 

-40-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
The United States Life Insurance Company in the City of New York
   
The Variable Annuity Life Insurance Company
             
By:
AIG Asset Management (U.S.), LLC, as Investment Adviser
              By:

/s/ David Etlinger
     
Name:
David Etlinger
     
Title: 
Vice President
 

-41-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
The Northwestern Mutual Life Insurance Company
             
By:
Northwestern Mutual Investment Management Company, LLC,
     
Its Investment Adviser
              By:

/s/ Bradley T. Kunath
     
Name:

Bradley T. Kunath      
Title:

Managing Director              
The Northwestern Mutual Life Insurance Company for its Group Annuity Separate
Account
              By:
/s/ Bradley T. Kunath
     
Name:

Bradley T. Kunath      
Title:

Its Authorized Representative  

-42-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Connecticut General Life Insurance Company
             
By:
Cigna Investments, Inc. (authorized agent)
             
By:

/s/ Chris Potter
     
Name:
Chris Potter
     
Title: 
Managing Director
             
Life Insurance Company of North America
             
By:
Cigna Investments, Inc. (authorized agent)
             
By:

/s/ Chris Potter
     
Name: 
Chris Potter
     
Title:
Managing Director
 

-43-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Manulife Life Insurance Company
             
By:
/s/ Akira Okada
     
Name:
Akira Okada
     
Title:
Head of Investments
 

-44-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Manufacturers Life Reinsurance Limited
             
By:

 /s/ Tatsuya Oshiro
     
Name:
Tatsuya Oshiro
     
Title:
Co-Head of Investments,
Manulife General Account Investments (Singapore) Pte. Ltd.
as investment manager of
Manufacturers Life Reinsurance Limited
 

-45-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Great-West Life & Annuity Insurance Company
              By:

/s/ Ward Argust
      Name:
Ward Argust
      Title:

Assistant Vice President, Investments
 

-46-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
The Canada Life Assurance Company
              By:
/s/ David Ayers
      Name:
David Ayers
      Title:
Sr. Managing Dir. Bond Investments
AUTHORIZED SIGNATORY
              By:
/s/ William Sharman
      Name:
William Sharman
      Title:
VP Bond Investments
       
AUTHORIZED SIGNATORY
 

-47-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Massachusetts Mutual Life Insurance Company
             
By:
Barings LLC as Investment Adviser
              By:
/s/ Elisabeth A. Perenick
     
Name:

Elisabeth A. Perenick      
Title:

Managing Director              
C.M. Life Insurance Company
             
By:
Barings LLC as Investment Adviser
              By:

/s/ Elisabeth A. Perenick
     
Name:

Elisabeth A. Perenick      
Title:

Managing Director  

-48-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
AXA Equitable Life Insurance Company
              By:
/s/ Amy Judd
      Name:
Amy Judd
      Title:
Investment Officer
 

-49-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Thrivent Financial for Lutherans
              By:
/s/ Christopher Patton
      Name:

Christopher Patton
      Title:
Managing Director
 

-50-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Jackson National Life Insurance Company
             
By:
PPM America, Inc., as attorney in fact,
     
on behalf of Jackson National Life Insurance Company
              By:
/s/ Luke S. Stifflear
     
Name:

Luke S. Stifflear      
Title:

Senior Managing Director  

-51-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Transamerica Premier Life Insurance Company
             
By:
AEGON USA Investment Management, LLC, its investment manager
              By:
/s/ Frederick B. Howard
     
Name:
Frederick B. Howard
     
Title: 
Vice President
             
Transamerica Life Insurance Company
             
By:
AEGON USA Investment Management, LLC, its investment manager
             
By
/s/ Frederick B. Howard
     
Name:
Frederick B. Howard
     
Title: 
Vice President
             
Transamerica Life (Bermuda) Ltd
             
By:
AEGON USA Investment Management, LLC, its investment manager
             
By:
/s/ Frederick B. Howard
     
Name:
Frederick B. Howard
     
Title: 
Vice President
 

-52-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
NASSAU LIFE INSURANCE COMPANY
             
By:
Nassau Asset Management LLC,
   
Its:
Investment Manager
             
By:
/s/ David E. Czerniecki
     
Name:
 David E. Czerniecki
     
Title: 
Chief Investment Officer
             
NASSAU LIFE AND ANNUITY COMPANY
             
By:
Nassau Asset Management LLC,
   
Its:
Investment Manager
             
By:
/s/ David E. Czerniecki
     
Name:
 David E. Czerniecki
     
Title: 
Chief Investment Officer
 

-53-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
The Guardian Life Insurance Company of America
             
By:

/s/ Timothy Powell
     
Name:
 Timothy Powell
     
Title: 
Managing Director
             
The Guardian Insurance & Annuity Company, Inc.
             
By:

/s/ Timothy Powell
     
Name:
 Timothy Powell
     
Title: 
Managing Director
 

-54-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
MONY Life Insurance Company
              By:
/s/ Diane S. Griswold
     
Name:
 Diane S. Griswold
     
Title:
 2nd VP, Investments
 

-55-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
State Farm Mutual Automobile Insurance Company
             
By:
 /s/  Julie Hoyer
     
Name:
 Julie Hoyer
     
Title:
 Investment Executive
              By:

/s/ Rebekah L. Holt
     
Name:
 Rebekah L. Holt
     
Title: 
Investment Professional
             
State Farm Fire and Casualty Company
              By:
/s/  Julie Hoyer
     
Name:
 Julie Hoyer
     
Title: 
Investment Executive
             
By:
 /s/ Rebekah L. Holt
     
Name:
 Rebekah L. Holt
     
Title:
 Investment Professional
             
State Farm Insurance Companies Employee Retirement Trust
             
By:
/s/  Julie Hoyer
     
Name:
 Julie Hoyer
     
Title:
 Investment Executive
             
By:

/s/ Rebekah L. Holt
     
Name:
 Rebekah L. Holt
     
Title: 
Investment Professional
 

-56-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
CMFG Life Insurance Company
             
By:
MEMBERS Capital Advisors, Inc.,
     
acting as Investment Advisor
              By:
/s/ Allen R. Cantrell
     
Name:
Allen R. Cantrell
     
Title:
Managing Director, Investments
 

 
-57-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Country Life Insurance Company
             
By:
/s/ John A. Jacobs
     
Name: 
John A. Jacobs
     
Title: 
Director – Fixed Income
             
Country Mutual Insurance Company
             
By:
/s/ John A. Jacobs
     
Name:
John A. Jacobs
     
Title: 
Director – Fixed Income
 

-58-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
United of Omaha Life Insurance Company
             
By:
/s/ Justin P. Kavan
     
Name:
Justin P. Kavan
     
Title: 
Senior Vice President
 

-59-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Ameritas Life Insurance Corp.
   
Ameritas Life Insurance Corp. of New York
             
By:
Ameritas Investment Partners Inc., as Agent
             
By:
 /s/ Tina Udell
     
Name:
Tina Udell
     
Title:
Vice President & Managing Director
 

-60-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
American United Life Insurance Company
             
By:
/s/ David M. Weisenburger
     
Name:
David M. Weisenburger
     
Title:
VP, Fixed Income Securities
 

-61-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Genworth Life Insurance Company
             
By:
 /s/ Stuart Shepetin
     
Name:
Stuart Shepetin
     
Title:
Investment Officer
 

-62-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Standard Insurance Company
             
By:
/s/ Chris Beaulieu
     
Name:
Chris Beaulieu
     
Title: 
VP, Individual Annuities & Investments
 

-63-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date thereof.

 
Southern Farm Bureau Life Insurance Company
             
By:

/s/ David Divine
     
Name:
David Divine
     
Title: 
Director – Securities Management
 

-64-

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

Defined Terms
 
As used herein, the following terms have the respective meanings set forth below
or set forth in the Section hereof following such term:
 
“Additional Obligations” means notes issued under the Indenture (other than the
Notes) after the date of the First Closing or mortgage bonds issued under the
Mortgage (other than the Pledged Mortgage Bonds) after the date of the First
Closing.
 
“Affiliate” means, at any time, and with respect to any Person, (a) any other
Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of voting or equity interests of the
Company or any Subsidiary or any Person of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
10% or more of any class of voting or equity interests.  Unless the context
otherwise clearly requires, any reference to an “Affiliate” is a reference to an
Affiliate of the Company.
 
“Agreement” is defined in Section 16.3.
 
“Anti‑Corruption Laws” means any law or regulation in a U.S. or any non‑U.S.
jurisdiction regarding bribery or any other corrupt activity, including the U.S.
Foreign Corrupt Practices Act and the U.K. Bribery Act 2010.
 
“Anti‑Money Laundering Laws” means any law or regulation in a U.S. or any
non‑U.S. jurisdiction regarding money laundering, drug trafficking,
terrorist‑related activities or other money laundering predicate crimes,
including the Currency and Foreign Transactions Reporting Act of 1970 (otherwise
known as the Bank Secrecy Act) and the USA PATRIOT Act.
 
“Blocked Person” means (a) a Person whose name appears on the list of Specially
Designated Nationals and Blocked Persons published by OFAC, (b) a Person,
entity, organization, country or regime that is blocked or a target of sanctions
that have been imposed under U.S. Economic Sanctions Laws or (c) a Person that
is an agent, department or instrumentality of, or is otherwise beneficially
owned by, controlled by or acting on behalf of, directly or indirectly, any
Person, entity, organization, country or regime described in clause (a) or (b).
 
“Business Day” means for the purposes of any provision of this Agreement, any
day other than a Saturday, a Sunday or a day on which commercial banks in New
York, New York or Folsom, New Jersey are required or authorized to be closed.
 
“Called Principal” is defined in Section 8.6.

SCHEDULE B
(to Note Purchase Agreement)
 

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

“Capital Lease” means, at any time, a lease with respect to which the lessee is
required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.“Change in Control” is defined
in Section 8.7(g).
 
“CISADA” means the Comprehensive Iran Sanctions, Accountability and Divestment
Act.
 
“Closing” is defined in Section 3.
 
“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time.
 
“Collateral Filings” is defined in Section 4.11.
 
“Company” is defined in the first paragraph of this Agreement.
 
“Confidential Information” is defined in Section 20.
 
“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or otherwise.
 
“Control Event” means:
 
(i)          the execution by the Company or any of its Affiliates of any
agreement or letter of intent with respect to any proposed transaction or event
or series of transactions or events which, individually or in the aggregate, may
reasonably be expected to result in a Change in Control, or
 
(ii)          the execution of any written agreement which, when fully performed
by the parties thereto, would result in a Change in Control.
 
 “Controlled Entity” means (a) any of the Subsidiaries of the Company and any of
their or the Company’s respective Controlled Affiliates and (b) if the Company
has a parent company, such parent company and its Controlled Affiliates. 
 
“Default” means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.
 
“Default Rate” means that rate of interest that is the greater of (i) 2% per
annum above the rate of interest stated in the Notes of such Tranche or (ii) 2%
over the rate of interest publicly announced by Bank of America, N.A. in New
York, New York as its “base” or “prime” rate.
 
“Discounted Value” is defined in Section 8.6.
 
“Disclosure Documents” is defined in Section 5.3.  
 
B-2

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

“Electronic Delivery” is defined in Section 7.1(a).
 
“Environmental Laws” means any and all federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including but not limited to
those related to Hazardous Materials.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the rules and regulations promulgated thereunder from
time to time in effect.
 
“ERISA Affiliate” means any trade or business (whether or not incorporated) that
is treated as a single employer together with the Company under Section 414 of
the Code.
 
“Event of Default” is defined in Section 11.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Financing Agreements” means this Agreement, the Indenture, the Notes, the
Pledged Mortgage Bonds, and the Mortgage (including without limitation the
Second Supplement).
 
“First Closing” is defined in Section 3.
 
“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States of America.
 
“Governmental Authority” means:
 
(a)          the government of
 
(i)           the United States of America or any State or other political
subdivision thereof, or
 
(ii)          any other jurisdiction in which the Company or any Subsidiary
conducts all or any part of its business, or which asserts jurisdiction over any
properties of the Company or any Subsidiary, or
 
(b)          any entity exercising executive, legislative, judicial, regulatory
or administrative functions of, or pertaining to, any such government.
 
“Hazardous Material” means any and all pollutants, toxic or hazardous wastes
that might pose a hazard to health and safety, the removal of which may be
required or the generation, manufacture, refining, production, processing,
treatment, storage, handling, transportation, transfer, use, disposal, release,
discharge, spillage, seepage or filtration of which is or shall be restricted,
prohibited or penalized by any applicable Environmental Law including, but not
limited to, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar
restricted, prohibited or penalized substances. 
 
B-3

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

“Holder” is defined in the Indenture. 
 
“Indebtedness” with respect to any Person means, at any time, without
duplication,
 
(a)          its liabilities for borrowed money and its redemption obligations
in respect of mandatorily redeemable Preferred Stock;
 
(b)          its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the ordinary
course of business but including all liabilities created or arising under any
conditional sale or other title retention agreement with respect to any such
property);
 
(c)         (i) all liabilities appearing on its balance sheet in accordance
with GAAP in respect of Capital Leases and (ii) all liabilities which would
appear on its balance sheet in accordance with GAAP in respect of synthetic
leases assuming such synthetic leases were accounted for as Capital Leases;
 
(d)          all liabilities for borrowed money secured by any Lien with respect
to any property owned by such Person (whether or not it has assumed or otherwise
become liable for such liabilities);
 
(e)          all liabilities in respect of letters of credit or instruments
serving a similar function issued or accepted for such Person’s account by banks
and other financial institutions (whether or not representing obligations for
borrowed money);
 
(f)           the aggregate swap termination value of all swap contracts of such
Person, and
 
(g)          any guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (f) hereof. 
 
Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (g) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
 
“Indenture” is defined in Section 1.1.
 
“INHAM Exemption” is defined in Section 6.2(e).
 
“Institutional Investor” means (a) any Purchaser of a Note, (b) any Holder of a
Note holding (together with one or more of its affiliates) more than 5% of the
aggregate principal amount of the Notes then outstanding, (c) any Holder of a
Note that is a bank, trust company, savings and loan association or other
financial institution, a pension plan, an investment company, an insurance
company, a broker or dealer, or another similar financial institution or entity,
regardless of legal form, and (d) any Related Fund of any Holder of any Note
referred to in clauses (a) through (c) above. 
 
B-4

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

“Investor Presentation” is defined in Section 5.3.
 
“Lien” means, with respect to any Person, any mortgage, lien, pledge, charge,
security interest or other encumbrance, or any interest or title of any vendor,
lessor, lender or other secured party to or of such Person under any conditional
sale or other title retention agreement or Capital Lease, upon or with respect
to any property or asset of such Person (including in the case of stock,
stockholder agreements, voting trust agreements and all similar arrangements).
 
“Make‑Whole Amount” is defined in Section 8.6.
 
“Material” means material in relation to the business, operations, affairs,
financial condition, assets or properties of the Company and its Subsidiaries
taken as a whole.
 
“Material Adverse Effect” means a material adverse effect on (a) the business,
operations, affairs, financial condition, assets or properties of the Company
and its Subsidiaries taken as a whole, (b) the ability of the Company to perform
its obligations under this Agreement, the Notes or the Indenture or (c) the
validity or enforceability of any Financing Agreement.
 
“Mortgage” is defined in Section 1.2. 
 
“Mortgaged Property” shall have the meaning for such term in the Mortgage. 
 
“Mortgage Trustee” is defined in Section 1.2. 
 
“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term
is defined in Section 4001(a)(3) of ERISA).
 
“NAIC” means the National Association of Insurance Commissioners or any
successor thereto.
 
“NAIC Annual Statement” is defined in Section 6.2(a).
 
“Notes” is defined in Section 1.1.
 
“OFAC” means the Office of Foreign Assets Control of the United States
Department of the Treasury.
 
“OFAC Sanctions Program” means any economic or trade sanction that OFAC is
responsible for administering and enforcing.  A list of OFAC Sanctions Programs
may be found at
http://www.treasury.gov/resource‑center/sanctions/Programs/Pages/Programs.aspx.
 
B-5

--------------------------------------------------------------------------------

South Jersey Gas Company
Note Purchase Agreement

“Officer’s Certificate” means a certificate of a Senior Financial Officer or of
any other officer of the Company whose responsibilities extend to the subject
matter of such certificate.
 
“Original Indenture” is defined in Section 1.1.
 
“Original Mortgage” is defined in Section 1.2.
 
“Parent” shall mean South Jersey Industries, Inc., a New Jersey corporation. 
 
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA or any successor thereto.
 
“Permitted Encumbrances” is defined in the Indenture. 
 
“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, business entity or
Governmental Authority.
 
“Plan” means an “employee benefit plan” (as defined in Section 3(3) of ERISA)
subject to Title I of ERISA that is or, within the preceding five years, has
been established or maintained, or to which contributions are or, within the
preceding five years, have been made or required to be made, by the Company or
any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate
may have any liability.
 
“Pledged Mortgage Bond” is defined in Section 1.2.
 
“Preferred Stock” means any class of capital stock of a Person that is preferred
over any other class of capital stock (or similar equity interests) of such
Person as to the payment of dividends or the payment of any amount upon
liquidation or dissolution of such Person.
 
“property” or “properties” means, unless otherwise specifically limited, real or
personal property of any kind, tangible or intangible, choate or inchoate.
 
“Proposed Prepayment Date” is defined in Section 8.7(b).
 
“PTE” is defined in Section 6.2(a).
 
“Public Order” means order of the Board of Public Utilities, State of New
Jersey, BPU Docket No. GF18070696, dated September 17, 2018 and effective
September 27, 2018. 
 
“Purchaser” is defined in the first paragraph of this Agreement.
 
“QPAM Exemption” is defined in Section 6.2(d).
 
“Reinvestment Yield” is defined in Section 8.6.
 
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South Jersey Gas Company
Note Purchase Agreement

“Related Fund” means, with respect to any Holder of any Note, any fund or entity
that (a) invests in Securities or bank loans, and (b) is advised or managed by
such Holder, the same investment advisor as such Holder or by an Affiliate of
such Holder or such investment advisor.
 
“Remaining Average Life” is defined in Section 8.6.
 
“Remaining Scheduled Payments” is defined in Section 8.6.
 
“Required Holders” means (i) at any time, prior to the Second Closing, (x) the
Purchasers of the Tranche C Notes and (y) the holders of more than 50% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates); and (ii) at any time, on or
after the Second Closing, the holders of more than 50% in principal amount of
the Notes at the time outstanding (exclusive of Notes then owned by the Company
or any of its Affiliates).
 
“Responsible Officer” means any Senior Financial Officer and any other officer
of the Company with responsibility for the administration of the relevant
portion of this Agreement.
 
“SEC” means the Securities and Exchange Commission of the United States, or any
successor thereto.
 
“Second Closing” is defined in Section 3.
 
“Second Supplement” is defined in Section 1.2.
 
“Securities” or “Security” shall have the meaning specified in Section 2(1) of
the Securities Act.
 
“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
 
“Senior Financial Officer” means the chief financial officer or the treasurer of
the Company.
 
“Settlement Date” is defined in Section 8.6.
 
“Source” is defined in Section 6.2. 
 
“State Sanctions List” means a list that is adopted by any state Governmental
Authority within the United States of America pertaining to Persons that engage
in investment or other commercial activities in Iran or any other country that
is a target of economic sanctions imposed under U.S. Economic Sanctions Laws.
 
“Subsidiary” means, as to any Person, any other Person in which such first
Person or one or more of its Subsidiaries or such first Person and one or more
of its Subsidiaries owns sufficient equity or voting interests to enable it or
them (as a group) ordinarily, in the absence of contingencies, to elect a
majority of the directors (or Persons performing similar functions) of such
second Person, and any partnership or joint venture if more than a 50% interest
in the profits or capital thereof is owned by such first Person or one or more
of its Subsidiaries or such first Person and one or more of its Subsidiaries
(unless such partnership or joint venture can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries).  Unless the context otherwise clearly requires, any reference to
a “Subsidiary” is a reference to a Subsidiary of the Company.
 
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South Jersey Gas Company
Note Purchase Agreement

“SVO” means the Securities Valuation Office of the NAIC or any successor to such
Office.
 
“Tranche” means (a) with respect to the Notes, the Tranche A Notes, the Tranche
B Notes or the Tranche C Notes, as the context requires, and (b) with respect to
the Pledged Mortgage Bonds, the Tranche A Pledged Mortgage Bond, the Tranche B
Pledged Mortgage Bond or the Tranche C Pledged Mortgage Bond, as the context
requires.
 
“Tranche A Notes” is defined in Section 1.1.
 
“Tranche B Notes” is defined in Section 1.1.
 
“Tranche C Notes” is defined in Section 1.1.
 
“Tranche A Pledged Mortgage Bond” is defined in Section 1.2.
 
“Tranche B Pledged Mortgage Bond” is defined in Section 1.2.
 
“Tranche C Pledged Mortgage Bond” is defined in Section 1.2.
 
“Trustee” is defined in Section 1.1. 
 
“UCC” means, the Uniform Commercial Code as enacted and in effect from time to
time in the state whose laws are treated as applying to the Mortgaged Property.
 
“UCC Financing Statements” shall mean any financing statements required or
permitted to be filed in accordance with the UCC. 
 
“USA PATRIOT Act” means United States Public Law 107‑56, Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
 
“U.S. Economic Sanctions Laws” means those laws, executive orders, enabling
legislation or regulations administered and enforced by the United States
pursuant to which economic sanctions have been imposed on any Person, entity,
organization, country or regime, including the Trading with the Enemy Act, the
International Emergency Economic Powers Act, the Iran Sanctions Act, the Sudan
Accountability and Divestment Act, each as amended from time to time, and any
other OFAC Sanctions Program.

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