Credit Agreement



 Exhibit 10.1 

CREDIT AGREEMENT 

THIS CREDIT AGREEMENT (this “Agreement”) is entered into as of May 27, 2010, by and between SJW CORP., a California
corporation (“Corp”), and SJW LAND COMPANY, a California corporation (“Landco”) (with Corp and Landco sometimes hereinafter referred to individually and collectively as “Borrower” or “Borrowers”), and WELLS
FARGO BANK, NATIONAL ASSOCIATION (“Bank”). 
 RECITALS 

Borrower has requested that Bank extend or continue credit to Borrower as described below, and Bank has agreed to provide such credit to
Borrower on the terms and conditions contained herein. 
 NOW, THEREFORE, for valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Bank and Borrower hereby agree as follows: 
 ARTICLE I 

CREDIT TERMS 

SECTION 1.1. LINE OF CREDIT. 

(a) Line of Credit. Subject to the terms and conditions of this Agreement, Bank hereby agrees to make advances to Borrower from
time to time up to and including June 1, 2012, not to exceed at any time the aggregate principal amount of Ten Million Dollars ($10,000,000.00) (“Line of Credit”), the proceeds of which shall be used first, to refinance
Borrower’s outstanding credit accommodations from Bank, and second, to finance general corporate purposes. Borrower’s obligation to repay advances under the Line of Credit shall be evidenced by a promissory note dated as of May 27,
2010 (“Line of Credit Note”), all terms of which are incorporated herein by this reference. 
 (b) Letter of Credit
Subfeature. As a subfeature under the Line of Credit, Bank agrees from time to time during the term thereof to issue or cause an affiliate to issue standby letters of credit for the account of Borrower in furtherance of corporate purposes (each,
a “Letter of Credit” and collectively, “Letters of Credit”); provided however, that the aggregate undrawn amount of all outstanding Letters of Credit shall not at any time exceed Five Million Dollars ($5,000,000.00). The form and
substance of each Letter of Credit shall be subject to approval by Bank, in its sole discretion. Each Letter of Credit shall be issued for a term not to exceed one (1) year, as designated by Borrower; provided however, that no Letter of Credit
shall have an expiration date subsequent to the maturity date of the Line of Credit. The undrawn amount of all Letters of Credit shall be reserved under the Line of Credit and shall not be available for borrowings thereunder. Each Letter of Credit
shall be subject to the additional terms and conditions of the Letter of Credit agreements, applications and any related documents required by Bank in connection with the issuance thereof. Each drawing paid under a Letter of Credit shall be deemed
an advance under the Line of Credit and shall be repaid by Borrower in accordance with the terms and conditions of this Agreement applicable to such advances; provided however, that if advances under the Line of Credit are not available, for any
reason, at the time any drawing is paid, then Borrower shall immediately pay to Bank the full amount drawn, together with interest thereon from the date such drawing is paid to the date such amount is fully repaid by Borrower, at the rate of
interest applicable to advances under the Line of Credit. In such event Borrower agrees that Bank, in its sole discretion, may debit any account maintained by Borrower with Bank for the amount of any such drawing. 







 (c) Borrowing and Repayment. Borrower may from time to time during the term of the
Line of Credit borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions contained herein or in the Line of Credit Note; provided however, that the total outstanding
borrowings under the Line of Credit shall not at any time exceed the maximum principal amount available thereunder, as set forth above. Notwithstanding the foregoing, Borrower shall maintain a zero balance on advances under the Line of Credit for a
period of at least thirty (30) consecutive days during each 12-month period commencing June 1, 2010. 
 SECTION 1.2.
INTEREST/FEES. 
 (a) Interest. The outstanding principal balance of each credit subject hereto shall bear interest at
the rate of interest set forth in each promissory note or other instrument or document executed in connection therewith. 
 (b)
Computation and Payment. Interest shall be computed on the basis of a 360-day year, actual days elapsed. Interest shall be payable at the times and place set forth in each promissory note or other instrument or document required hereby.

 (c) Unused Commitment Fee. Borrower shall pay to Bank a fee equal to one-quarter percent (0.25%) per annum (computed
on the basis of a 360-day year, actual days elapsed) on the average daily unused amount of the Line of Credit, which fee shall be calculated on a quarterly basis by Bank and shall be due and payable by Borrower in arrears within ten (10) days
after each billing is sent by Bank. 
 (d) Letter of Credit Fees. Borrower shall pay to Bank (i) fees upon the
issuance of each Letter of Credit equal to one and three hundred seventy-five thousandths percent (1.375%) per annum (computed on the basis of a 360-day year, actual days elapsed) of the face amount thereof, and (ii) fees upon the payment
or negotiation of each drawing under any Letter of Credit and fees upon the occurrence of any other activity with respect to any Letter of Credit (including without limitation, the transfer, amendment or cancellation of any Letter of Credit)
determined in accordance with Bank’s standard fees and charges then in effect for such activity and charges then in effect for such activity. The issuance fee described in (i) above and applicable to each Letter of Credit shall be payable
in successive advance installments over the term of the applicable Letter of Credit, with the first installment due on the date of its issuance and each installment thereafter due at the end of each ninety (90) day period thereafter; provided,
that if there is less than ninety (90) days remaining until the expiration of such Letter of Credit, the last installment shall be due on such expiration date. 

SECTION 1.3. COLLECTION OF PAYMENTS. Corp authorizes Bank to collect all principal, interest and fees due under the Line of Credit by
charging Corp’s deposit account number XXXXX with Bank, or any other deposit account maintained by Corp with Bank, for the full amount thereof. Should there be insufficient funds in any such deposit account to pay all such sums when due, the
full amount of such deficiency shall be immediately due and payable by Borrower. 
  

 2 








 ARTICLE II 

REPRESENTATIONS AND WARRANTIES 

Each Borrower makes the following representations and warranties to Bank, which representations and warranties shall survive the
execution of this Agreement and shall continue in full force and effect until the full and final payment, and satisfaction and discharge, of all obligations of Borrower to Bank subject to this Agreement. 

SECTION 2.1. LEGAL STATUS. Borrower is a corporation, duly organized and existing and in good standing under the laws of California, and
is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification or licensing is required or in which the failure to so qualify or to be so licensed could have
a material adverse effect on Borrower. 
 SECTION 2.2. AUTHORIZATION AND VALIDITY. This Agreement and each promissory note,
contract, instrument and other document required hereby or at any time hereafter delivered to Bank in connection herewith (collectively, the “Loan Documents”) have been duly authorized, and upon their execution and delivery in accordance
with the provisions hereof will constitute legal, valid and binding agreements and obligations of Borrower or the party which executes the same, enforceable in accordance with their respective terms. 

SECTION 2.3. NO VIOLATION. The execution, delivery and performance by Borrower of each of the Loan Documents do not violate any provision
of any law or regulation, or contravene any provision of the Articles of Incorporation or By-Laws of Borrower, or result in any breach of or default under any contract, obligation, indenture or other instrument to which Borrower is a party or by
which Borrower may be bound. 
 SECTION 2.4. LITIGATION. There are no pending, or to the best of Borrower’s knowledge
threatened, actions, claims, investigations, suits or proceedings by or before any governmental authority, arbitrator, court or administrative agency which could have a material adverse effect on the financial condition or operation of Borrower
other than those disclosed by Borrower to Bank in writing prior to the date hereof. 
 SECTION 2.5. CORRECTNESS OF FINANCIAL
STATEMENT. The annual financial statement of Borrower dated December 31, 2009, and all interim financial statements delivered to Bank since said date, true copies of which have been delivered by Borrower to Bank prior to the date hereof,
(a) are complete and correct and present fairly the financial condition of Borrower, (b) disclose all liabilities of Borrower that are required to be reflected or reserved against under generally accepted accounting principles, whether
liquidated or unliquidated, fixed or contingent, and (c) have been prepared in accordance with generally accepted accounting principles consistently applied. Since the dates of such financial statements there has been no material adverse change
in the financial condition of Borrower, nor has Borrower mortgaged, pledged, granted a security interest in or otherwise encumbered any of its assets or properties except in favor of Bank or as otherwise permitted by Bank in writing. 

SECTION 2.6. INCOME TAX RETURNS. Borrower has no knowledge of any pending assessments or adjustments of its income tax payable with
respect to any year. 
  

 3 








 SECTION 2.7. NO SUBORDINATION. There is no agreement, indenture, contract or instrument to
which Borrower is a party or by which Borrower may be bound that requires the subordination in right of payment of any of Borrower’s obligations subject to this Agreement to any other obligation of Borrower. 

SECTION 2.8. PERMITS, FRANCHISES. Borrower possesses, and will hereafter possess, all permits, consents, approvals, franchises and
licenses required and rights to all trademarks, trade names, patents, and fictitious names, if any, necessary to enable it to conduct the business in which it is now engaged in compliance with applicable law. 

SECTION 2.9. ERISA. Borrower is in compliance in all material respects with all applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended or recodified from time to time (“ERISA”); Borrower has not violated any provision of any defined employee pension benefit plan (as defined in ERISA) maintained or contributed to by Borrower (each, a
“Plan”); no Reportable Event as defined in ERISA has occurred and is continuing with respect to any Plan initiated by Borrower; Borrower has met its minimum funding requirements under ERISA with respect to each Plan; and each Plan will be
able to fulfill its benefit obligations as they come due in accordance with the Plan documents and under generally accepted accounting principles. 

SECTION 2.10. OTHER OBLIGATIONS. Borrower is not in default on any obligation for borrowed money, any purchase money obligation or any
other material lease, commitment, contract, instrument or obligation. 
 SECTION 2.11. ENVIRONMENTAL MATTERS. Except as
disclosed by Borrower to Bank in writing prior to the date hereof, Borrower is in compliance in all material respects with all applicable federal or state environmental, hazardous waste, health and safety statutes, and any rules or regulations
adopted pursuant thereto, which govern or affect any of Borrower’s operations and/or properties, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Superfund Amendments and
Reauthorization Act of 1986, the Federal Resource Conservation and Recovery Act of 1976, and the Federal Toxic Substances Control Act, as any of the same may be amended, modified or supplemented from time to time. None of the operations of Borrower
is the subject of any federal or state investigation evaluating whether any remedial action involving a material expenditure is needed to respond to a release of any toxic or hazardous waste or substance into the environment. Borrower has no
material contingent liability in connection with any release of any toxic or hazardous waste or substance into the environment. 

ARTICLE III 

CONDITIONS 

SECTION 3.1. CONDITIONS OF INITIAL EXTENSION OF CREDIT. The obligation of Bank to extend any credit contemplated by this Agreement is
subject to the fulfillment to Bank’s satisfaction of all of the following conditions: 
 (a) Approval of Bank
Counsel. All legal matters incidental to the extension of credit by Bank shall be satisfactory to Bank’s counsel. 
  

 4 








 (b) Documentation. Bank shall have received, in form and substance satisfactory to
Bank, each of the following, duly executed: 
  

	 	(i)	This Agreement and each promissory note or other instrument or document required hereby. 


 

	 	(ii)	Corporate Resolution: Borrowing (2). 

  

	 	(iii)	Certificate of Incumbency (2). 

  

	 	(iv)	Disbursement Order. 

  

	 	(v)	Such other documents as Bank may require under any other Section of this Agreement. 


(c) Financial Condition. There shall have been no material adverse change, as determined by Bank, in the financial condition or
business of Borrower, nor any material decline, as reasonably determined by Bank, in the market value of a substantial or material portion of the assets of Borrower. 

SECTION 3.2. CONDITIONS OF EACH EXTENSION OF CREDIT. The obligation of Bank to make each extension of credit requested by Borrower
hereunder shall be subject to the fulfillment to Bank’s satisfaction of each of the following conditions: 
 (a)
Compliance. The representations and warranties contained herein and in each of the other Loan Documents shall be true on and as of the date of the signing of this Agreement and on the date of each extension of credit by Bank pursuant hereto,
with the same effect as though such representations and warranties had been made on and as of each such date, and on each such date, no Event of Default as defined herein, and no condition, event or act which with the giving of notice or the passage
of time or both would constitute such an Event of Default, shall have occurred and be continuing or shall exist. 
 (b)
Documentation. Bank shall have received all additional documents which may be required in connection with such extension of credit. 

ARTICLE IV 

AFFIRMATIVE COVENANTS 

Each Borrower covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether
direct or contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, Borrower shall, unless Bank otherwise consents in
writing: 
 SECTION 4.1. PUNCTUAL PAYMENTS. Punctually pay all principal, interest, fees or other liabilities due under any of
the Loan Documents at the times and place and in the manner specified therein. 
 SECTION 4.2. ACCOUNTING RECORDS. Maintain
adequate books and records in accordance with generally accepted accounting principles consistently applied, and permit any representative of Bank, at any reasonable time, to inspect, audit and examine such books and records, to make copies of the
same, and to inspect the properties of Borrower. Bank will keep all information received under this Agreement (“Borrower Information”) confidential, and will not disclose such Borrower Information to any person or entity, except
disclosures: (a) to federal and state bank examiners, and other regulatory officials having jurisdiction over Bank; (b) to (i) 

 

 5 








 
Bank’s representatives (including, without limitation, all other banks and companies affiliated with Wells Fargo & Company, and their legal counsel, auditors, and other professional
advisors retained by Bank or its affiliates on a need to know basis), (ii) syndication parties and loan participants, and (iii) any rating agency of Bank, provided that each such individual or entity is informed of the confidential nature
of the Borrower Information, and has agreed to treat the Borrower Information as confidential in accordance with terms and conditions no less protective than as set forth in this Agreement; (c) required by law or legal process in the opinion of
Bank’s representatives; or (d) otherwise authorized in writing by Borrower. In the event that Bank or any of its representatives is, in the opinion of Bank’s counsel, required by applicable law to disclose any Borrower Information,
then Bank, unless prohibited by law, will provide notice of the legal process to Borrower so that Borrower, at its sole option (but without obligation to do so), and at its sole expense, may attempt to seek a protective order or other appropriate
remedy and/or waive compliance with the provisions of this Agreement. Notwithstanding the provisions above, Borrower Information does not include information that: (w) is or becomes generally available to the public other than as a result of an
unauthorized disclosure by Bank or its representatives; (x) is or becomes available to Bank on a non-confidential basis by Borrower or any officer, employee, agent or representative of Borrower prior to its disclosure by Bank; (y) is or
becomes available to Bank from a source not known to Bank to be under an obligation of confidentiality to Borrower; or (z) is independently developed by Bank without the use of the Borrower Information. 

SECTION 4.3. FINANCIAL STATEMENTS. Provide to Bank all of the following, in form and detail satisfactory to Bank: 

(a) not later than 100 days after and as of the end of each calendar year, Corp’s 10K report filed with the Securities Exchange
Commission and an audited consolidated and consolidating financial statement of Corp, prepared by a certified public accountant acceptable to Bank, to include a balance sheet, an income statement, a statement of cash flow, a management report, an
auditor’s report, together with all supporting schedules and footnotes; 
 (b) not later than 55 days after and as of the
end of each quarter, Corp’s 10Q report filed with the Securities Exchange Commission and a financial statement of Corp, prepared by Corp, to include a balance sheet, an income statement, and a statement of cash flow; 

(c) contemporaneously with each annual and quarterly financial statement of Borrower required hereby, a certificate of the president or
chief financial officer of Borrower that said financial statements are accurate and that there exists no Event of Default nor any condition, act or event which with the giving of notice or the passage of time or both would constitute an Event of
Default; 
 (d) from time to time such other information as Bank may reasonably request. 

SECTION 4.4. COMPLIANCE. Preserve and maintain all licenses, permits, governmental approvals, rights, privileges and franchises necessary
for the conduct of its business; and comply with the provisions of all documents pursuant to which Borrower is organized and/or which govern Borrower’s continued existence and with the requirements of all laws, rules, regulations and orders of
any governmental authority applicable to Borrower and/or its business. 
 SECTION 4.5. INSURANCE. Maintain and keep in force,
for each business in which Borrower is engaged, insurance of the types and in amounts customarily carried in similar lines 
  


 6 








 
of business, including but not limited to fire, extended coverage, public liability, flood, property damage and workers’ compensation, with all such insurance carried with companies and in
amounts satisfactory to Bank, and deliver to Bank from time to time at Bank’s request schedules setting forth all insurance then in effect. 

SECTION 4.6. FACILITIES. Keep all properties useful or necessary to Borrower’s business in good repair and condition, and from time
to time make necessary repairs, renewals and replacements thereto so that such properties shall be fully and efficiently preserved and maintained. 

SECTION 4.7. TAXES AND OTHER LIABILITIES. Pay and discharge when due any and all indebtedness, obligations, assessments and taxes, both
real or personal, including without limitation federal and state income taxes and state and local property taxes and assessments, except (a) such as Borrower may in good faith contest or as to which a bona fide dispute may arise, and
(b) for which Borrower has made provision, to Bank’s satisfaction, for eventual payment thereof in the event Borrower is obligated to make such payment. 

SECTION 4.8. LITIGATION. Promptly give notice in writing to Bank of any litigation pending or threatened against Borrower with a claim in
excess of $5,000,000.00. 
 SECTION 4.9. NOTICE TO BANK. Promptly (but in no event more than five (5) days after the
occurrence of each such event or matter) give written notice to Bank in reasonable detail of: (a) the occurrence of any Event of Default, or any condition, event or act which with the giving of notice or the passage of time or both would
constitute an Event of Default; (b) any change in the name or the organizational structure of Borrower; (c) the occurrence and nature of any Reportable Event or Prohibited Transaction, each as defined in ERISA, or any funding deficiency
with respect to any Plan; or (d) any termination or cancellation of any insurance policy which Borrower is required to maintain, or any uninsured or partially uninsured loss through liability or property damage, or through fire, theft or any
other cause affecting Borrower’s property in excess of an aggregate of $5,000,000.00. 
 ARTICLE V 

NEGATIVE COVENANTS 

Each Borrower further covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities
(whether direct or contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, Borrower will not without Bank’s prior
written consent: 
 SECTION 5.1. USE OF FUNDS. Use any of the proceeds of any credit extended hereunder except for the purposes
stated in Article I hereof. 
 SECTION 5.2. OTHER INDEBTEDNESS. Create, incur, assume or permit to exist any indebtedness
or liabilities resulting from borrowings, loans or advances, whether secured or unsecured, matured or unmatured, liquidated or unliquidated, joint or several, except (a) the liabilities of Borrower to Bank, and (b) any other liabilities of
Borrower existing as of, and disclosed to Bank prior to, the date hereof, (c) indebtedness secured by real property of Borrower, (d) any indebtedness or liabilities not in excess of an aggregate of $1,000,000.00 outstanding at any
time in total for Landco and Corp to persons or entities other than Bank or affiliates of Borrower, (e) any indebtedness or liabilities of Corp to any wholly-owned subsidiary of Corp, including Landco, and (f) any indebtedness or
liabilities of Landco to Corp. or to any other wholly-owned subsidiary of Corp. 
  

 7 








 SECTION 5.3. MERGER, CONSOLIDATION, TRANSFER OF ASSETS. Merge into or consolidate
with any other entity; make any substantial change in the nature of Borrower’s business as conducted as of the date hereof; acquire all or substantially all of the assets of any other entity; nor sell, lease, transfer or otherwise dispose of
all or a substantial or material portion of Borrower’s assets except in the ordinary course of its business; provided, however, that Borrower shall be permitted to engage in any non-hostile mergers, acquisitions, or asset transfers other than
in the ordinary course of its business so long as (a) the aggregate amount involved in all such transactions does not exceed $5,000,000.00 during the term of this Agreement; (b) Borrower remains the surviving entity in the event of any
merger, (c) no Event of Default or any condition, event or act which with the giving of notice or the passage of time or both would constitute an Event of Default exists at the time of such transaction or would result from the consummation of
any such transaction, immediately after giving effect thereto, and (d) any such merger or acquisition involves a line of business substantially the same as that which is presently engaged in by Borrower. Notwithstanding the foregoing, any
sale by Corp of its shares of common stock in California Water Service Group shall not be restricted by this Agreement. 

SECTION 5.4. GUARANTIES. Guarantee or become liable in any way as surety, endorser (other than as endorser of negotiable instruments for
deposit or collection in the ordinary course of business), accommodation endorser or otherwise for, nor pledge or hypothecate any assets of Borrower as security for, any liabilities or obligations of any other person or entity, except (a) any
of the foregoing in favor of Bank, (b) except by way of issuing standby letters of credit pursuant to Section 1.1 (b) of this Agreement, and (c) guarantees by Corp in the ordinary course of business of the indebtedness of any
subsidiary in which Corp holds a 70% or greater ownership interest. 
 SECTION 5.5. LOANS, ADVANCES, INVESTMENTS. Make any loans
or advances to or investments in any person or entity, except (a) any of the foregoing existing as of, and disclosed to Bank prior to, the date hereof, (b) loans or advances to the other Borrower or by Corp to any subsidiary in which Corp
holds a 70% or greater ownership interest, and (c) investments made by Corp in any subsidiary in which Corp holds a 70% or greater ownership interest. 

SECTION 5.6. DIVIDENDS, DISTRIBUTIONS. Declare or pay any dividend or distribution either in cash, stock or any other property on
Borrower’s stock now or hereafter outstanding, nor redeem, retire, repurchase or otherwise acquire any shares of any class of Borrower’s stock now or hereafter outstanding in violation of any agreement to which Borrower is bound or if such
action would result in such a violation immediately after giving effect thereto. 
 SECTION 5.7. DISTRIBUTIONS FROM SAN JOSE
WATER COMPANY. Enter into any agreement with any other than Bank, or permit San Jose Water Company to enter into any agreement with any party other than Bank that would restrict the declaration or payment of dividends and distributions from San Jose
Water Company to Corp or limit San Jose Water Company’s ability to do so or Corp’s ability to receive the same. 

SECTION 5.8. PLEDGE OF ASSETS. Mortgage, pledge, grant or permit to exist a security interest in, or lien upon, all or any
portion of Borrower’s assets now owned or hereafter acquired, except (a) any of the foregoing in favor of Bank or which is existing as of, and 

 

 8 








 
disclosed to Bank in writing prior to, the date hereof, (b) voluntary liens on real property of Borrower, and (c) voluntary liens that secure other liabilities permitted under
Section 5.2 to the extent such liens are purchase money liens or liens on specific assets given in connection with indebtedness permitted under Section 5.2(d), (d) liens for unpaid taxes that either (i) are not yet delinquent or
(ii) are subject to a good faith protest by Borrower and for which, to the extent required by generally accepted accounting principles then in effect, proper and adequate book reserves are established by Borrower, and (e) liens arising by
operation of law or pursuant to contracts for warehousemen, landlords, carriers, mechanics, materialmen, laborers or suppliers, incurred in the ordinary course of business that (i) are not yet delinquent or (ii) are subject to a good faith
protest by Borrower and for which, to the extent required by generally accepted accounting principles then in effect, proper and adequate book reserves are established by Borrower, and (f) leases and subleases entered into by Landco in its
ordinary course of business. 
 ARTICLE VI 

EVENTS OF DEFAULT 

SECTION 6.1. The occurrence of any of the following shall constitute an “Event of Default” under this Agreement: 

(a) Borrower shall fail to pay when due any principal, interest, fees or other amounts payable under any of the Loan Documents.

 (b) Any financial statement or certificate furnished to Bank in connection with, or any representation or warranty made by
Borrower or any other party under this Agreement or any other Loan Document shall prove to be incorrect, false or misleading in any material respect when furnished or made. 

(c) Any default in the performance of or compliance with any obligation, agreement or other provision contained herein or in any other
Loan Document (other than those specifically described as an “Event of Default” in this section 6.1), and with respect to any such default that by its nature can be cured, such default shall continue for a period of twenty (20) days
from its occurrence. 
 (d) Any default in the payment or performance of any obligation, or any defined event of default, under
the terms of any contract, instrument or document (other than any of the Loan Documents) pursuant to which Borrower or San Jose Water Company has incurred any debt or other liability (i) to Bank, or (ii) to any person or entity, to the
extent such debt or liability to such persons or entities other than Bank exceeds $1,000,000 in the aggregate. 
 (e) Borrower
shall become insolvent, or shall suffer or consent to or apply for the appointment of a receiver, trustee, custodian or liquidator of itself or any of its property, or shall generally fail to pay its debts as they become due, or shall make a general
assignment for the benefit of creditors; Borrower shall file a voluntary petition in bankruptcy, or seeking reorganization, in order to effect a plan or other arrangement with creditors or any other relief under the Bankruptcy Reform Act, Title 11
of the United States Code, as amended or recodified from time to time (“Bankruptcy Code”), or under any state or federal law granting relief to debtors, whether now or hereafter in effect; or Borrower shall file an answer admitting the
jurisdiction of the court and the material allegations of any involuntary petition; or Borrower shall be adjudicated a bankrupt, or an order for relief shall be entered against Borrower by any court of competent jurisdiction under the Bankruptcy
Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors. 
  

 9 








 (f) The filing of a notice of judgment lien against Borrower; or the recording of any
abstract of judgment against Borrower in any county in which Borrower has an interest in real property; or the service of a notice of levy and/or of a writ of attachment or execution, or other like process, against the assets of Borrower; or the
entry of a judgment against Borrower, if the related claim involves at least Five Million Dollars ($5,000,000.00) or such other amount that would cause aggregate outstanding claims against Borrower in respect of any or all of the foregoing to exceed
Five Million Dollars ($5,000,000.00); or any involuntary petition or proceeding pursuant to the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors is filed or commenced
against Borrower. 
 (g) There shall exist or occur any event or condition that Bank in good faith believes impairs, or is
substantially to impair, the prospect of payment or performance by Borrower of its obligations under any of the Loan Documents. 

(h) The dissolution or liquidation of Borrower; or Borrower, or any of its directors, stockholders or members, shall take action seeking
to effect the dissolution or liquidation of Borrower. 
 (i) Corp shall own and control less than one hundred percent
(100%) of the common stock of (i) San Jose Water Company and (ii) Landco. 
 (j) San Jose Water Company shall
enter into any agreement with any party other than Bank, or any event occurs that would restrict the declaration or payment of dividends and distributions from San Jose Water Company to Corp or limit San Jose Water Company’s ability to do so or
Corp’s ability to receive the same. 
 SECTION 6.2. REMEDIES. Upon the occurrence of any Event of Default: (a) all
indebtedness of Borrower under each of the Loan Documents, any term thereof to the contrary notwithstanding, shall at Bank’s option and without notice become immediately due and payable without presentment, demand, protest or notice of
dishonor, all of which are hereby expressly waived by each Borrower; (b) the obligation, if any, of Bank to extend any further credit under any of the Loan Documents shall immediately cease and terminate; and (c) Bank shall have all
rights, powers and remedies available under each of the Loan Documents, or accorded by law, including without limitation the right to resort to any or all security for any credit subject hereto and to exercise any or all of the rights of a
beneficiary or secured party pursuant to applicable law. All rights, powers and remedies of Bank may be exercised at any time by Bank and from time to time after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be
in addition to any other rights, powers or remedies provided by law or equity. 
 ARTICLE VII 

MISCELLANEOUS 

SECTION 7.1. NO WAIVER. No delay, failure or discontinuance of Bank in exercising any right, power or remedy under any of the Loan
Documents shall affect or operate as a waiver of such right, power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of
any other right, power or remedy. Any waiver, permit, consent or approval of any kind by Bank of any breach of or default under any of the Loan Documents must be in writing and shall be effective only to the extent set forth in such writing.

  

 10 








 SECTION 7.2. NOTICES. All notices, requests and demands which any party is required or may
desire to give to any other party under any provision of this Agreement must be in writing delivered to each party at the following address: 
  

			
	BORROWER:	  	SJW CORP.
		  	110 W. Taylor Street
		  	San Jose, CA 95110
		
		  	SJW LAND COMPANY
		  	110 W. Taylor Street
		  	San Jose, CA 95110
		
	BANK:	  	WELLS FARGO BANK, NATIONAL ASSOCIATION
		  	121 S. Market Street,
2nd Floor
		  	San Jose, Ca 95113

 or to such other address as any party
may designate by written notice to all other parties. Each such notice, request and demand shall be deemed given or made as follows: (a) if sent by hand delivery, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt
or three (3) days after deposit in the U.S. mail, first class and postage prepaid; and (c) if sent by telecopy, upon receipt. 

SECTION 7.3. COSTS, EXPENSES AND ATTORNEYS’ FEES. Borrower shall pay to Bank immediately upon demand the full amount of all
payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include outside counsel fees and all allocated costs of Bank’s in-house counsel), expended or incurred by Bank in connection with (a) the
negotiation and preparation of this Agreement and the other Loan Documents, Bank’s continued administration hereof and thereof, and the preparation of any amendments and waivers hereto and thereto, (b) the enforcement of Bank’s rights
and/or the collection of any amounts which become due to Bank under any of the Loan Documents, and (c) the prosecution or defense of any action in any way related to any of the Loan Documents, including without limitation, any action for
declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary
proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity. 

SECTION 7.4. SUCCESSORS, ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the heirs, executors,
administrators, legal representatives, successors and assigns of the parties; provided however, that Borrower may not assign or transfer its interests or rights hereunder without Bank’s prior written consent. Bank reserves the right to sell,
assign, transfer, negotiate or grant participations in all or any part of, or any interest in, Bank’s rights and benefits under each of the Loan Documents. In connection therewith, Bank may disclose all documents and information which Bank now
has or may hereafter acquire relating to any credit subject hereto, Borrower or its business, or any collateral required hereunder. 
  

 11 








 SECTION 7.5. ENTIRE AGREEMENT; AMENDMENT. This Agreement and the other Loan
Documents constitute the entire agreement between Borrower and Bank with respect to each credit subject hereto and supersede all prior credit agreements (including, without limitation, that certain Credit Agreement dated August 1, 2001, as
amended from time to time), negotiations, communications, discussions and correspondence concerning the subject matter hereof. This Agreement may be amended or modified only in writing signed by each party hereto. 

SECTION 7.6. NO THIRD PARTY BENEFICIARIES. This Agreement is made and entered into for the sole protection and benefit of the parties
hereto and their respective permitted successors and assigns, and no other person or entity shall be a third party beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement or any other of the Loan
Documents to which it is not a party. 
 SECTION 7.7. TIME. Time is of the essence of each and every provision of this Agreement
and each other of the Loan Documents. 
 SECTION 7.8. SEVERABILITY OF PROVISIONS. If any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or any remaining provisions of this Agreement. 

SECTION 7.9. COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall
be deemed to be an original, and all of which when taken together shall constitute one and the same Agreement. 
 SECTION 7.10.
GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of California. 

SECTION 7.11 JOINT AND SEVERAL LIABILITY. 

(a) Each Borrower has determined and represents to Bank that it is in its best interests and in pursuance of its legitimate business
purposes to induce Bank to extend credit pursuant to this Agreement. Each Borrower acknowledges and represents that its business is related to the business of the other Borrower, the availability of the commitments provided for herein benefits both
Borrowers, and advances and other credit extensions made hereunder will be for and inure to the benefit of Borrowers, individually and together. 

(b) Each Borrower has determined and represents to Bank that it has, and after giving effect to the transactions contemplated by this
Agreement will have, assets having a fair saleable value in excess of its debts, after giving effect to any rights of contribution or subrogation which may be available to such Borrower, and each Borrower has, and will have, access to adequate
capital for the conduct of its business and the ability to pay its debts as such debts mature. 
 (c) Each Borrower agrees that
it is jointly and severally liable to Bank for, and each Borrower agrees to pay to Bank when due the full amount of, all indebtedness now existing or 

 

 12 








 
hereafter arising to Bank under or in connection with the Line of Credit and all modifications, extensions and renewals thereof, including without limitation all interest which accrues thereon
and all fees, costs and expenses chargeable to Borrowers or either of them in connection with the Line of Credit. The obligations of Borrowers to Bank for the Line of Credit hereunder shall be in addition to any obligations of Borrowers to Bank
under any other agreement heretofore or hereafter given to Bank unless said other agreement is expressly modified or revoked in writing, and this Agreement shall not, unless expressly herein provided, affect or invalidate any such other agreement.

 (d) The liability of each Borrower for the Line of Credit shall be reinstated and revived and the rights of Bank shall
continue if and to the extent that for any reason any amount at any time paid on account of the Line of Credit is rescinded or must otherwise be restored by Bank, whether as a result of any proceedings in bankruptcy or reorganization or otherwise,
all as though such amount had not been paid. 
 (e) Each Borrower authorizes Bank, without notice to or demand on such Borrower,
and without affecting such Borrower’s liability for the Line of Credit, from time to time to: (a) alter, compromise, extend, accelerate or otherwise change the time for payment of, or otherwise change the terms of, the liabilities and
obligations of the other Borrower to Bank on account of the Line of Credit; (b) take and hold security from the other Borrower for the payment of the Line of Credit, and exchange, enforce, waive, subordinate or release any such security;
(c) apply such security and direct the order or manner of sale thereof, including without limitation, a non-judicial sale permitted by the terms of the controlling security agreement or deed of trust, as Bank in its discretion may determine;
(d) release or substitute any one or more of the endorsers or any guarantors of the Line of Credit, or any other party obligated thereon; and (e) apply payments received by Bank from the other Borrower to indebtedness of the other Borrower
to Bank other than the Line of Credit. 
 (f) Each Borrower represents and warrants to Bank that it has established adequate
means of obtaining from the other Borrower on a continuing basis financial and other information pertaining to the other Borrower’s financial condition, and each Borrower agrees to keep adequately informed from such means of any facts, events
or circumstances which might in any way affect its risks hereunder. Each Borrower further agrees that Bank shall have no obligation to disclose to it any information or material about the other Borrower which is acquired by Bank in any manner.

 (g) Each Borrower waives any right to require Bank to: (i) proceed against the other Borrower or any other person;
(ii) proceed against or exhaust any security held from the other Borrower or any other person; (iii) pursue any other remedy in Bank’s power; (iv) apply payments received by Bank from the other Borrower to the Line of Credit; or
(v) make any presentments or demands for performance, or give any notices of nonperformance, protests, notices of protest or notices of dishonor in connection with the Line of Credit. 

(h) Each Borrower waives any defense to its liability for the Line of Credit based upon or arising by reason of: (i) any disability
or other defense of the other Borrower or any other person; (ii) the cessation or limitation from any cause whatsoever, other than payment in full, of the liability of the other Borrower for the Line of Credit; (iii) any lack of authority
of any officer, director, partner, agent or other person acting or purporting to act on behalf of the other Borrower or any defect in the formation of the other Borrower; (iv) the application by the other Borrower of the proceeds of the Line of
Credit for purposes other than the purposes intended or understood by Bank or Borrowers; (v) any act or omission by Bank which directly or indirectly 

 

 13 








 
results in or aids the discharge of the other Borrower by operation of law or otherwise, or which in any way impairs or suspends any rights or remedies of Bank against the other Borrower;
(vi) any impairment of the value of any interest in any security for the Line of Credit, including without limitation, the failure to obtain or maintain perfection or recordation of any interest in any such security, the release of any such
security without substitution, and/or the failure to preserve the value of, or to comply with applicable law in disposing of, any such security; or (vii) any modification of the obligations or liabilities of the other Borrower for the Line of
Credit, including without limitation the renewal, extension, acceleration or other change in time for payment of, or other change in the terms of, the indebtedness of either Borrower for the Line of Credit, including increase or decrease of the rate
of interest thereon. Until the Line of Credit and all indebtedness of each Borrower to Bank arising under or in connection with this Agreement shall have been paid in full, neither Borrower shall have any right of subrogation. Each Borrower waives
all rights and defenses it may have arising out of (A) any election of remedies by Bank, even though that election of remedies, such as a non-judicial foreclosure with respect to any security for the Line of Credit, destroys its rights of
subrogation or its rights to proceed against the other Borrower for reimbursement, or (B) any loss of rights it may suffer by reason of any rights, powers or remedies of the other Borrower in connection with any anti-deficiency laws or any
other laws limiting, qualifying or discharging either Borrower’s indebtedness for the Line of Credit, whether by operation of Sections 726 or 580d of the Code of Civil Procedure as from time to time amended, or otherwise. Until the Line of
Credit and all indebtedness of each Borrower to Bank arising under or in connection with this Agreement shall have been paid in full, each Borrower waives any right to enforce any remedy which Bank now has or may hereafter have against the other
Borrower or any other person, and waives any benefit of, or any right to participate in, any security now or hereafter held by Bank. 

SECTION 7.12. ARBITRATION. 

(a) Arbitration. The parties hereto agree, upon demand by any party, to submit to binding arbitration all claims, disputes and
controversies between or among them (and their respective employees, officers, directors, attorneys, and other agents), whether in tort, contract or otherwise in any way arising out of or relating to (i) any credit subject hereto, or any of the
Loan Documents, and their negotiation, execution, collateralization, administration, repayment, modification, extension, substitution, formation, inducement, enforcement, default or termination; or (ii) requests for additional credit.

 (b) Governing Rules. Any arbitration proceeding will (i) proceed in a location in California selected by the
American Arbitration Association (“AAA”); (ii) be governed by the Federal Arbitration Act (Title 9 of the United States Code), notwithstanding any conflicting choice of law provision in any of the documents between the parties; and
(iii) be conducted by the AAA, or such other administrator as the parties shall mutually agree upon, in accordance with the AAA’s commercial dispute resolution procedures, unless the claim or counterclaim is at least $1,000,000.00
exclusive of claimed interest, arbitration fees and costs in which case the arbitration shall be conducted in accordance with the AAA’s optional procedures for large, complex commercial disputes (the commercial dispute resolution procedures or
the optional procedures for large, complex commercial disputes to be referred to herein, as applicable, as the “Rules”). If there is any inconsistency between the terms hereof and the Rules, the terms and procedures set forth herein shall
control. Any party who fails or refuses to submit to arbitration following a demand by any other party shall bear all costs and expenses incurred by such other party in compelling arbitration of any dispute. Nothing contained herein shall be deemed
to be a waiver by any party that is a bank of the protections afforded to it under 12 U.S.C. §91 or any similar applicable state law. 
  

 14 








 (c) No Waiver of Provisional Remedies, Self-Help and Foreclosure. The arbitration
requirement does not limit the right of any party to (i) foreclose against real or personal property collateral; (ii) exercise self-help remedies relating to collateral or proceeds of collateral such as setoff or repossession; or
(iii) obtain provisional or ancillary remedies such as replevin, injunctive relief, attachment or the appointment of a receiver, before during or after the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of
the right or obligation of any party to submit any dispute to arbitration or reference hereunder, including those arising from the exercise of the actions detailed in sections (i), (ii) and (iii) of this paragraph. 

(d) Arbitrator Qualifications and Powers. Any arbitration proceeding in which the amount in controversy is $5,000,000.00 or less
will be decided by a single arbitrator selected according to the Rules, and who shall not render an award of greater than $5,000,000.00. Any dispute in which the amount in controversy exceeds $5,000,000.00 shall be decided by majority vote of a
panel of three arbitrators; provided however, that all three arbitrators must actively participate in all hearings and deliberations. The arbitrator will be a neutral attorney licensed in the State of California or a neutral retired judge of the
state or federal judiciary of California, in either case with a minimum of ten years experience in the substantive law applicable to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether or not an issue is
arbitratable and will give effect to the statutes of limitation in determining any claim. In any arbitration proceeding the arbitrator will decide (by documents only or with a hearing at the arbitrator’s discretion) any pre-hearing motions
which are similar to motions to dismiss for failure to state a claim or motions for summary adjudication. The arbitrator shall resolve all disputes in accordance with the substantive law of California and may grant any remedy or relief that a court
of such state could order or grant within the scope hereof and such ancillary relief as is necessary to make effective any award. The arbitrator shall also have the power to award recovery of all costs and fees, to impose sanctions and to take such
other action as the arbitrator deems necessary to the same extent a judge could pursuant to the Federal Rules of Civil Procedure, the California Rules of Civil Procedure or other applicable law. Judgment upon the award rendered by the arbitrator may
be entered in any court having jurisdiction. The institution and maintenance of an action for judicial relief or pursuit of a provisional or ancillary remedy shall not constitute a waiver of the right of any party, including the plaintiff, to submit
the controversy or claim to arbitration if any other party contests such action for judicial relief. 
 (e) Discovery. In
any arbitration proceeding, discovery will be permitted in accordance with the Rules. All discovery shall be expressly limited to matters directly relevant to the dispute being arbitrated and must be completed no later than 20 days before the
hearing date. Any requests for an extension of the discovery periods, or any discovery disputes, will be subject to final determination by the arbitrator upon a showing that the request for discovery is essential for the party’s presentation
and that no alternative means for obtaining information is available. 
 (f) Class Proceedings and Consolidations. No
party hereto shall be entitled to join or consolidate disputes by or against others in any arbitration, except parties who have executed any Loan Document, or to include in any arbitration any dispute as a representative or member of a class, or to
act in any arbitration in the interest of the general public or in a private attorney general capacity. 
 (g) Payment Of
Arbitration Costs And Fees. The arbitrator shall award all costs and expenses of the arbitration proceeding. 
  

 15 








 (h) Real Property Collateral; Judicial Reference. Notwithstanding anything herein to
the contrary, no dispute shall be submitted to arbitration if the dispute concerns indebtedness secured directly or indirectly, in whole or in part, by any real property unless (i) the holder of the mortgage, lien or security interest
specifically elects in writing to proceed with the arbitration, or (ii) all parties to the arbitration waive any rights or benefits that might accrue to them by virtue of the single action rule statute of California, thereby agreeing that all
indebtedness and obligations of the parties, and all mortgages, liens and security interests securing such indebtedness and obligations, shall remain fully valid and enforceable. If any such dispute is not submitted to arbitration, the dispute shall
be referred to a referee in accordance with California Code of Civil Procedure Section 638 et seq., and this general reference agreement is intended to be specifically enforceable in accordance with said Section 638. A referee with the
qualifications required herein for arbitrators shall be selected pursuant to the AAA’s selection procedures. Judgment upon the decision rendered by a referee shall be entered in the court in which such proceeding was commenced in accordance
with California Code of Civil Procedure Sections 644 and 645. 
 (i) Miscellaneous. To the maximum extent practicable,
the AAA, the arbitrators and the parties shall take all action required to conclude any arbitration proceeding within 180 days of the filing of the dispute with the AAA. No arbitrator or other party to an arbitration proceeding may disclose the
existence, content or results thereof, except for disclosures of information by a party required in the ordinary course of its business or by applicable law or regulation. If more than one agreement for arbitration by or between the parties
potentially applies to a dispute, the arbitration provision most directly related to the Loan Documents or the subject matter of the dispute shall control. This arbitration provision shall survive termination, amendment or expiration of any of the
Loan Documents or any relationship between the parties. 
 (j) Small Claims Court. Notwithstanding anything herein to the
contrary, each party retains the right to pursue in Small Claims Court any dispute within that court’s jurisdiction. Further, this arbitration provision shall apply only to disputes in which either party seeks to recover an amount of money
(excluding attorneys’ fees and costs) that exceeds the jurisdictional limit of the Small Claims Court. 
  

 16 








 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
day and year first written above. 
  

									
		 		 		 	WELLS FARGO BANK,
	SJW CORP.	 		 	NATIONAL ASSOCIATION
					
	By:	 	 /s/ W. Richard Roth
	 		 	By:	 	 /s/ Kevin Herr

		 	W. Richard Roth	 		 		 	Kevin Herr
		 	President	 		 		 	Vice President
					
	By:	 	 /s/ David Green
	 		 		 	
		 	David Green	 		 		 	
		 	Chief Financial Officer	 		 		 	
				
	SJW LAND COMPANY	 		 		 	
					
	By:	 	 /s/ W. Richard Roth
	 		 		 	
		 	W. Richard Roth	 		 		 	
		 	President	 		 		 	
					
	By:	 	 /s/ David Green
	 		 		 	
		 	David Green	 		 		 	
		 	Chief Financial Officer	 		 		 	

  

 17 









			
	 WELLS FARGO
	  	REVOLVING LINE OF CREDIT NOTE
		
	 $10,000,000.00
	  	 San Jose, California

May 27, 2010



FOR VALUE RECEIVED, the undersigned SJW CORP. and SJW LAND COMPANY (“Borrower”) promises to pay to the order of WELLS FARGO BANK, NATIONAL
ASSOCIATION (“Bank”) at its office at Santa Clara Valley RCBO, 121 S. Market Street, 2nd Floor, San Jose, CA 95113, or at such other place as the holder hereof may designate, in lawful money of the United States of America and in
immediately available funds, the principal sum of $10,000,000.00, or so much thereof as may be advanced and be outstanding, with interest thereon, to be computed on each advance from the date of its disbursement as set forth herein. 

1. DEFINITIONS: 
 As used
herein, the following terms shall have the meanings set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined: 

1.1 “Business Day” means any day except a Saturday, Sunday or any other day on which commercial banks in California are authorized or required
by law to close. 
 1.2 “Fixed Rate Term” means a period commencing on a Business Day and continuing for 1, 2, 3 or 6 months, as
designated by Borrower, during which all or a portion of the outstanding principal balance of this Note bears interest determined in relation to LIBOR; provided however, that no Fixed Rate Term may be selected for a principal amount less than
$500,000.00; and provided further, that no Fixed Rate Term shall extend beyond the scheduled maturity date hereof. If any Fixed Rate Term would end on a day which is not a Business Day, then such Fixed Rate Term shall be extended to the next
succeeding Business Day. 
 1.3 “LIBOR” means the rate per annum (rounded upward, if necessary, to the nearest whole 1/8 of 1%)
determined by dividing Base LIBOR by a percentage equal to 100% less any LIBOR Reserve Percentage. 
 (a) “Base LIBOR”
means the rate per annum for United States dollar deposits quoted by Bank as the Inter-Bank Market Offered Rate, with the understanding that such rate is quoted by Bank for the purpose of calculating effective rates of interest for loans making
reference thereto, on the first day of a Fixed Rate Term for delivery of funds on said date for a period of time approximately equal to the number of days in such Fixed Rate Term and in an amount approximately equal to the principal amount to which
such Fixed Rate Term applies. Borrower understands and agrees that Bank may base its quotation of the Inter-Bank Market Offered Rate upon such offers or other market indicators of the Inter-Bank Market as Bank in its discretion deems appropriate
including, but not limited to, the rate offered for U.S. dollar deposits on the London Inter-Bank Market. 
 (b) “LIBOR
Reserve Percentage” means the reserve percentage prescribed by the Board of Governors of the Federal Reserve System (or any successor) for “Eurocurrency Liabilities” (as defined in Regulation D of the Federal Reserve Board, as
amended), adjusted by Bank for expected changes in such reserve percentage during the applicable Fixed Rate Term. 
 1.4 “Prime Rate”
means at any time the rate of interest most recently announced within Bank at its principal office as its Prime Rate, with the understanding that the Prime Rate is one of Bank’s base rates and serves as the basis upon which effective rates of
interest are calculated for those loans making reference thereto, and is evidenced by the recording thereof after its announcement in such internal publication or publications as Bank may designate. 

2. INTEREST: 
 2.1 Interest. The outstanding
principal balance of this Note shall bear interest (computed on the basis of a 36O-day year, actual days elapsed) either (a) at a fluctuating rate per annum 1.00000% below the Prime Rate in effect from time to time, or (b) at a fixed rate
per annum determined by Bank to be 1.37500% above LlBOR in effect on the first day of the applicable Fixed Rate Term. When interest is determined in relation to the Prime Rate, each change in the rate of interest hereunder shall become effective on
the date each Prime Rate change is announced within Bank. With respect to each LlBOR selection option selected hereunder, Bank is hereby authorized to note the date, principal amount, interest rate and Fixed Rate Term applicable thereto and any
payments made thereon on Bank’s books and records (either manually or by electronic entry) and/or on any schedule attached to this Note, which notations shall be prima facie evidence of the accuracy of the information noted. 







 2.2 Selection of Interest Rate Options. At any time any portion of this Note bears interest determined in
relation to LlBOR, it may be continued by Borrower at the end of the Fixed Rate Term applicable thereto so that all or a portion thereof bears interest determined in relation to the Prime Rate or to LlBOR for a new Fixed Rate Term designated by
Borrower. At any time any portion of this Note bears interest determined in relation to the Prime Rate, Borrower may convert all or a portion thereof so that it bears interest determined in relation to LlBOR for a Fixed Rate Term designated by
Borrower. At such time as Borrower requests an advance hereunder or wishes to select a LlBOR option for all or a portion of the outstanding principal balance hereof, and at the end of each Fixed Rate Term, Borrower shall give Bank notice specifying:
(a) the interest rate option selected by Borrower; (b) the principal amount subject thereto; and (c) for each LlBOR selection, the length of the applicable Fixed Rate Term. Any such notice may be given by telephone (or such other
electronic method as Bank may permit) so long as, with respect to each LlBOR selection, (i) if requested by Bank, Borrower provides to Bank written confirmation thereof not later than 3 Business Days after such notice is given, and
(ii) such notice is given to Bank prior to 10:00 a.m. on the first day of the Fixed Rate Term, or at a later time during any Business Day if Bank, at it’s sole option but without obligation to do so, accepts Borrower’s notice and
quotes a fixed rate to Borrower. If Borrower does not immediately accept a fixed rate when quoted by Bank, the quoted rate shall expire and any subsequent LlBOR request from Borrower shall be subject to a redetermination by Bank of the applicable
fixed rate. If no specific designation of interest is made at the time any advance is requested hereunder or at the end of any Fixed Rate Term, Borrower shall be deemed to have made a Prime Rate interest selection for such advance or the principal
amount to which such Fixed Rate Term applied. 
 2.3 Taxes and Regulatory Costs. Borrower shall pay to Bank immediately upon demand, in addition
to any other amounts due or to become due hereunder, any and all (a) withholdings, interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes) imposed by any domestic or foreign governmental authority and related
in any manner to LlBOR, and (b) future, supplemental, emergency or other changes in the LlBOR Reserve Percentage, assessment rates imposed by the Federal Deposit Insurance Corporation, or similar requirements or costs imposed by any domestic or
foreign governmental authority or resulting from compliance by Bank with any request or directive (whether or not having the force of law) from any central bank or other governmental authority and related in any manner to LlBOR to the extent they
are not included in the calculation of LlBOR. In determining which of the foregoing are attributable to any LlBOR option available to Borrower hereunder, any reasonable allocation made by Bank among its operations shall be conclusive and binding
upon Borrower. 
 2.4 Payment of Interest. Interest accrued on this Note shall be payable on the 1st day of each month, commencing June 1,
2010. 
 2.5 Default Interest. From and after the maturity date of this Note, or such earlier date as all principal owing hereunder becomes due
and payable by acceleration or otherwise, or at Bank’s option upon the occurrence, and during the continuance of an Event of Default, the outstanding principal balance of this Note shall bear interest at an increased rate per annum (computed on
the basis of a 36O-day year, actual days elapsed) equal to 4% above the rate of interest from time to time applicable to this Note. 







 3. BORROWING AND REPAYMENT: 

3.1 Borrowing and Repayment. Borrower may from time to time during the term of this Note borrow, partially or wholly repay its outstanding borrowings, and
reborrow, subject to all of the limitations, terms and conditions of this Note and of the Credit Agreement between Borrower and Bank defined below; provided however, that the total outstanding borrowings under this Note shall not at any time exceed
the principal amount stated above. The unpaid principal balance of this obligation at any time shall be the total amounts advanced hereunder by the holder hereof less the amount of principal payments made hereon by or for Borrower, which balance may
be endorsed hereon from time to time by the holder. The outstanding principal balance of this Note shall be due and payable in full on June 1, 2012. 

3.2 Advances. Advances hereunder, to the total amount of the principal sum available hereunder, may be made by the holder at the oral or written request
of (a) W. Richard Roth, Angela Yip, Suzy Papazian, Wendy Walker, Clarice Tam, David Green, anyone acting alone, who are authorized to request advances and direct the disposition of any advances until written notice of the revocation of such
authority is received by the holder at the office designated above, or (b) any person, with respect to advances deposited to the credit of any deposit account of Borrower, which advances, when so deposited, shall be conclusively presumed to
have been made to or for the benefit of Borrower regardless of the fact that persons other than those authorized to request advances may have authority to draw against such account. The holder shall have no obligation to determine whether any person
requesting an advance is or has been authorized by Borrower. 
 3.3 Application of Payments. Each payment made on this Note shall be credited
first, to any interest then due and second, to the outstanding principal balance hereof. All payments credited to principal shall be applied first, to the outstanding principal balance of this Note which bears interest determined in relation to the
Prime Rate, if any, and second, to the outstanding principal balance of this Note which bears interest determined in relation to LlBOR, with such payments applied to the oldest Fixed Rate Term first. 

4. PREPAYMENT: 
 4.1 Prime Rate. Borrower may
prepay principal on any portion of this Note which bears interest determined in relation to the Prime Rate at any time, in any amount and without penalty. 

4.2 LlBOR. Borrower may prepay principal on any portion of this Note which bears interest determined in relation to LlBOR at any time and in the minimum
amount of $100,000.00; provided however, that if the outstanding principal balance of such portion of this Note is less than said amount, the minimum prepayment amount shall be the entire outstanding principal balance thereof. In consideration of
Bank providing this prepayment option to Borrower, or if any such portion of this Note shall become due and payable at any time prior to the last day of the Fixed Rate Term applicable thereto by acceleration or otherwise, Borrower shall pay to Bank
immediately upon demand a fee which is the sum of the discounted monthly differences for each month from the month of prepayment through the month in which such Fixed Rate Term matures, calculated as follows for each such month: 

(a) Determine the amount of interest which would have accrued each month on the amount prepaid at the interest rate applicable to such
amount had it remained outstanding until the last day of the Fixed Rate Term applicable thereto. 
 (b) Subtract from the amount
determined in (a) above the amount of interest which would have accrued for the same month on the amount prepaid for the remaining term of such Fixed Rate Term at LlBOR in effect on the date of prepayment for new loans made for such term and in
a principal amount equal to the amount prepaid. 
 (c) If the result obtained in (b) for any month is greater than zero,
discount that difference by LlBOR used in (b) above. 







 
Borrower acknowledges that prepayment of such amount may result in Bank incurring additional costs, expenses and/or liabilities, and that it is difficult to ascertain the full extent of such
costs, expenses and/or liabilities. Borrower, therefore, agrees to pay the above-described prepayment fee and agrees that said amount represents a reasonable estimate of the prepayment costs, expenses and/or liabilities of Bank. If Borrower fails to
pay any prepayment fee when due, the amount of such prepayment fee shall thereafter bear interest until paid at a rate per annum 2.000% above the Prime Rate in effect from time to time (computed on the basis of a 360-day year, actual days elapsed).

 5. EVENTS OF DEFAULT: 

This Note is made pursuant to and is subject to the terms and conditions of that certain Credit Agreement between Borrower and Bank dated
as of May 27, 2010, as amended from time to time (the “Credit Agreement”). Any default in the payment or performance of any obligation under this Note, or any defined event of default under the Credit Agreement, shall constitute an
“Event of Default” under this Note. 
 6. MISCELLANEOUS: 

6.1 Remedies. Upon the occurrence of any Event of Default, the holder of this Note, at the holder’s option, may declare all sums of principal and
interest outstanding hereunder to be immediately due and payable without presentment, demand, notice of nonperformance, notice of protest, protest or notice of dishonor, all of which are expressly waived by Borrower, and the obligation, if any, of
the holder to extend any further credit hereunder shall immediately cease and terminate. Borrower shall pay to the holder immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable
attorneys’ fees (to include outside counsel fees and all allocated costs of the holder’s in-house counsel), expended or incurred by the holder in connection with the enforcement of the holder’s rights and/or the collection of any
amounts which become due to the holder under this Note, and the prosecution or defense of any action in any way related to this Note, including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level,
in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other
person) relating to Borrower or any other person or entity. 
 6.2 Obligations Joint and Several. Should more than one person or entity sign
this Note as a Borrower, the obligations of each such Borrower shall be joint and several. 
 6.3 Governing Law. This Note shall be governed by
and construed in accordance with the laws of the State of California. 
 IN WITNESS WHEREOF, the undersigned has executed this Note as of the
date first written above. 
  

			
	SJW CORP.
		
	By:	 	 /s/ W. Richard Roth

		 	W. Richard Roth, President
		
	By:	 	 /s/ David Green

		 	David Green, Chief Financial Officer
	
	SJW LAND COMPANY
		
	By:	 	 /s/ W. Richard Roth

		 	W. Richard Roth, President
		
	By:	 	 /s/ David Green

		 	David Green, Chief Financial Officer