Document:

ex10-3.htm

     

    
 

    

    Exhibit
10.3

    [Bank of
America Letterhead]

    

    

    

    

    May 4,
2009

    

    

    Utility
Services Affiliates (Perth Amboy) Inc.

    1500
Ronson Road

    Iselin,
New Jersey 08830

    

    Attention:  Mr.
Bruce O’Connor, Vice President and Treasurer

    

    
      	
               
      

            	
              Re:

            	
              Uncommitted
      Line of Credit

            

    

    
      	
               
      

            	
              Extension
      of Maturity Date

            

    

    

    Dear Mr.
O’Connor:

    

    Reference is made to the Master
Promissory Note, dated July 18, 2008 (the “Note”) in the original maximum
principal amount of Three Million and 00/100 Dollars ($3,000,000), executed by
Utility Services Affiliates (Perth Amboy) Inc., a New Jersey corporation (the
"Borrower") and delivered to Bank of America, N.A. (the “Bank”), and the
Uncommitted Line of Credit Letter Agreement, dated May 1, 2008, between the
Borrower and Bank (the “Letter Agreement”). The obligations to the Bank are
guaranteed by Middlesex Water Company under Continuing and Unconditional
Guaranty, dated July 22, 2008 (the “Guaranty”).  The Note, Letter
Agreement, Guaranty, and any and all other documents, instruments, and
agreements executed in connection therewith are referred to herein as the “Loan
Documents”. Capitalized terms used herein shall have the meaning ascribed to
them in the Loan Documents.

    

    The Borrower has requested that the
Note, the Letter Agreement, and all documents, instruments, agreements and
amendments that evidence, govern or secure the Note (together with the Note, and
the "Loan Documents") be modified for the purpose of extending the Maturity Date
(as such term is defined in the Note) and the Bank has agreed to such
extension.

    

    The Bank agrees that the Maturity Date
as set forth in the Loan Documents shall be extended from May 30, 2009 to May
30, 2010.

    

    Upon (a) the execution and delivery of
this Letter Agreement by the Borrower and (b) receipt by the Bank of any unpaid
payments under the Loan Documents, if any, through but not including the date of
the execution and delivery of this letter and the extension set forth in this
letter shall be effective and enforceable against the Borrower. Nothing herein
contained or implied shall be construed as a waiver of any other provision of
the Loan Documents or any other document executed in connection with the Loan
Documents or a waiver of any presently existing or future default in the
non-payment of principal and/or interest or any other amounts due under the Loan
Documents.

    

    The Borrower hereby warrants and
represents that the representations and warranties contained in the Loan
Documents continue to be true and correct and that no event of default, and no
event which with the giving of notice or lapse of time or both would become an
event of default, has occurred or is

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    continuing
under the Loan Documents.  The Borrower acknowledges that as of the
date hereof there are no offsets, defenses, claims, counterclaims, charges or
deductions of any nature against amounts due and owing under the Note or against
the Bank or any of its officers, directors or employers.

    

    The Borrower and the Guarantor hereby
ratify and confirm in all respects and without condition all of the terms and
provisions of the Loan Documents, as modified herein, as applicable, and each
agrees that said terms and provisions, except to the extent expressly modified
herein, continue in full force and effect.

    

    This letter shall be binding upon the
Borrower and each endorser and guarantor of the Loan Documents and their
respective successors, heirs and assigns and shall inure to the benefit of the
Bank and its successors and assigns. This Agreement shall take effect as a
sealed instrument and shall be governed by the laws of the State of New
Jersey.

    

    In no event shall this letter agreement
constitute or be construed as a waiver or release of the obligations of any
maker, guarantor, endorser or other person liable for the Borrower’s obligations
under the Note, and the obligations of such parties shall remain in full force
and effect.

    

    If this letter extending the Maturity
Date is acceptable, please acknowledge below and return the acknowledged copy to
me.

    

    If you have any questions, please
contact me.

    

    
      	 
      	
              Sincerely,

            
	 
      	 
      	 
      
	 
      	
              Bank
      of America, N.A.

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              By:

            	
              /s/Lori A.
      Moylan                    
      

            
	 
      	 
      	
              Lori
      A. Moylan

            
	 
      	 
      	
              Senior
      Vice President

            

    

    

    

    This
letter is agreed to by:

    

    
      	
              WITNESS:

            	 
      
	 
      	
              UTILITY
      SERVICES AFFILIATES (PERTH AMBOY) INC.

               

            
	
              /s/Ronald
      Williams

               

               

            	
              By:
      /s/ A. Bruce
      O’Connor                             
      

                   NAME:  A.
      Bruce O’Connor

                   TITLE:   Vice
      President & Treasurer

               

            

    

    

    GUARANTOR:

    

    MIDDLESEX
WATER COMPANY

    

    

    By: /s/A. Bruce
O’Connor           

           Vice
President & CFO

     
 

     

    -2-ex10-4.htm

    Exhibit 10.4

     

    
 

    Loan No.
RX0024T6

    

    PROMISSORY
NOTE AND SUPPLEMENT

    (Revolving
Term Loan Supplement)

    

    THIS PROMISSORY NOTE AND
SUPPLEMENT (this "Promissory Note and
Supplement"), is entered into as of March 19, 2009, between TIDEWATER UTILITIES, INC., a Delaware corporation (the
"Company"), and
CoBANK, ACB, a federally
chartered instrumentality of the United States ("CoBank"), and
supplements that certain Master Loan Agreement dated as of May 23, 2003 (as
amended or restated from time to time, the “MLA”). Capitalized
terms used herein and not defined herein shall have the meanings given to those
terms in the MLA.

    

    SECTION
1.          The Commitment.  On
the terms and conditions set forth in the MLA and this Promissory Note and
Supplement, CoBank agrees to make loans (each a “Loan”) to the Company
during the period set forth below in an aggregate principal amount not to exceed
$10,000,000 at any one time outstanding (the "Commitment").  Within
the limits and during the term of the Commitment, the Company may borrow, prepay
and reborrow.

    

    SECTION
2.          Purpose.  The
purpose of the Commitment is to finance capital expenditures and to provide
funds for general corporate purposes.

    

    SECTION
3.          Term.  The term of
the Commitment shall be from the date hereof, up to and including November 30,
2011, or such later date as CoBank may, in its sole discretion, authorize in
writing.

    

    SECTION
4.          Availability. Loans will be
made available as provided in Section 2.02 of the MLA.

    

    SECTION 5.     Interest.  

    

    (A)           Interest Rate Options. The
Company agrees to pay interest on the unpaid principal balance of the Loans in
accordance with one or more of the following interest rate options, as selected
by the Company:

    

    (1)           Weekly Quoted Variable Rate Option.
At a rate per annum equal to the rate of interest established by CoBank
on the first Business Day of each week (the "Variable Rate Option"). The rate
established by CoBank shall be effective until the first Business Day of the
next week. Each change in the rate shall be applicable to all balances subject
to this option and information about the then current rate shall be made
available upon telephonic request.

    

    (2)           Quoted Fixed Rate
Option.  At a fixed rate per annum to be quoted by CoBank in
its sole discretion in each instance (the “Quoted Fixed Rate Option”). Under this
option, rates may be fixed on such balances and for such periods (each a "Quoted Fixed Rate Period") as may be
agreeable to CoBank in its sole discretion in each instance; provided that: (1)
rates may not be fixed for periods of less than 180 days; (2) rates may be fixed
on balances of $100,000 or multiples thereof; and (3) the maximum number of
balances that may be subject to this option at any one time shall be five
(5).

    

    (3)           LIBOR Option.  At a
fixed rate per annum equal to "LIBOR" (as hereinafter defined) plus 1.50% per
annum (the “LIBOR Option”).  Under
this option:  (1) rates may be fixed for "Interest Periods" (as
hereinafter defined) of 1, 2, 3, or 6 months, as selected by the
Company;

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (2) rates
may be fixed on balances of $100,000 or multiples thereof; (3) the maximum
number of balances that may be fixed at any one time shall be five (5); (4)
rates may only be fixed on a "Banking Day" (as hereinafter defined) on 3 Banking
Days’ prior notice; and (5) rates may not be fixed for Interest Periods expiring
on or after the second anniversary of the date hereof, at which time this option
shall cease to be in effect. For purposes hereof: (a) "LIBOR" shall mean the
rate (rounded upward to the nearest sixteenth of a percentage point and adjusted
for reserves required on “Eurocurrency Liabilities” (as hereinafter defined) for
banks subject to “FRB Regulation D” (as hereinafter defined) or required by any
other federal law or regulation) quoted by the British Bankers Association
(“BBA”) at 11:00 a.m. London time 2 Banking Days before the commencement of the
Interest Period for the offering of U.S. dollar deposits in the London interbank
market for the Interest Period designated by the Company, as published by
Bloomberg or another major information vendor listed on BBA’s official website;
(b) "Banking Day" shall mean a day on which CoBank is open for business,
dealings in U.S. dollar deposits are being carried out in the London interbank
market, and banks are open for business in New York City and London, England;
(c) "Interest Period" shall mean a period commencing on the date this option is
to take effect and ending on the numerically corresponding day in the next
calendar month or the month that is 2, 3, or 6 months thereafter, as the case
may be; provided, however, that: (i) in the event such ending day is not a
Banking Day, such period shall be extended to the next Banking Day unless such
next Banking Day falls in the next calendar month, in which case it shall end on
the preceding Banking Day; and (ii) if there is no numerically corresponding day
in the month, then such period shall end on the last Banking Day in the relevant
month; (d) “Eurocurrency Liabilities” shall have the meaning as set forth in FRB
Regulation D; and (e) “FRB Regulation D” shall mean Regulation D as promulgated
by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as
amended.

    

    (B)           Elections. Subject to the
limitations set forth above, the Company: (1) shall select the applicable rate
option(s) at the time it requests a Loan; (2) may, on any Business Day, elect to
convert balances bearing interest at the Variable Rate Option to the Quoted
Fixed Rate Option; (3) may, on the last day of any Quoted Fixed Rate Period,
elect to refix the rate under the Quoted Fixed Rate Option or convert the
balance to the Variable Rate Option; (4) may, on the last day of any Interest
Period, elect to convert balances bearing interest at the LIBOR Option to the
Variable Rate Option or Quoted Fixed Rate Option; and (5) may, on three Banking
Days' prior notice, elect to convert balances bearing interest at the Variable
Rate Option or the Quoted Fixed Rate Option to the LIBOR Option or refix a rate
under the LIBOR Option; provided, however, that balances bearing interest at the
Quoted Fixed Rate Option or the LIBOR Option may not be converted or continued
until the last day of the Quoted Fixed Rate Period or Interest Period applicable
thereto. In the absence of an election provided for herein, the Company shall be
deemed to have elected the Variable Rate Option. Notwithstanding the foregoing,
rates may not be fixed for periods expiring after the maturity date of the
Loans. All elections provided for herein shall be made telephonically or in
writing and must be received by 12:00 noon Company’s local time on the
applicable Business Day. Any election made telephonically shall be promptly
confirmed in writing, if so requested by CoBank.

    

    (C)           Calculation and
Payment.  Interest shall be calculated on the actual number of
days each Loan is outstanding on the basis of a year consisting of 360
days.  In calculating interest, the date each Loan is made shall be
included and the date each Loan (or portion thereof) is repaid shall, if
received before 3:00 P.M. Mountain time, be excluded.  Interest shall
be payable monthly in arrears by the twentieth (20th) day
of the following month (or on such other day in such month as CoBank shall
require in a written notice to the Company). Notwithstanding the foregoing, at
CoBank’s option, interest on any balance bearing interest at the LIBOR Option
shall be payable on the last day of the Interest Period or, in the case of
Interest Periods of longer than three months, at three month
intervals.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (D)           Additional Provisions Regarding The
LIBOR Option. Notwithstanding any other provision hereof, CoBank shall
have the right to temporarily suspend or permanently terminate the Company’s
ability to fix rates under the LIBOR Option or for one or more Interest Periods
if, for any reason whatsoever (including a change in Law): (1) LIBOR is no
longer being quoted in the London interbank market or is no longer being quoted
for an Interest Period; (2) CoBank is prohibited from offering rates based on
LIBOR; or (3) CoBank’s cost to fund balances bearing interest at the LIBOR
Option (as determined by CoBank in its sole discretion) increases beyond any
corresponding increase in LIBOR or decreases less than any corresponding
decrease in LIBOR. In addition, if as a result of a change in Law or otherwise,
CoBank is required to allocate additional capital to, or otherwise bear increase
costs as a result of maintaining balances under, the LIBOR Option, the Company
agrees to indemnify CoBank upon demand against all such costs.

    

    SECTION
6.          Fees. In consideration of the
Commitment, the Company agrees to pay to CoBank a commitment fee on the average
daily unused portion of the Commitment from the date hereof to the date the
Commitment expires at the rate of 1/5th of
1% per annum (calculated on a 360 day basis). The fee shall be: (A) calculated
quarterly in arrears as of the last day of each calendar quarter and on the date
the Commitment expires or is terminated; and (B) shall be due and payable on the
20th day
of each January, April, July, and October, and on the date the Commitment
expires or is terminated. The fee shall be payable for each quarter or portion
thereof occurring during the original or any extended term of the
Commitment.

    

    SECTION
7.          Promissory
Note.  The Company promises to repay the Loans to CoBank or
order on the last day of the term of the Commitment, as same may be extended
from time to time. In addition to the above, the Company promises to pay to
CoBank or order interest on the unpaid principal balance of the Loans at the
times and in accordance with the provisions set forth above. If any date on
which principal or interest is due is not a Business Day, then such payment
shall be due and payable on the next Business Day and, in the case of principal,
interest shall continue to accrue on the amount thereof.

    

    SECTION
8.          Prepayment.  Subject
to section 10.01 of the MLA, the Company may, on one (or, in the case of fixed
rate balances, three) Business Day’s prior written notice, prepay all or any
portion of the Loans.  Unless otherwise agreed, all prepayments will
be applied to such balances, fixed or variable, as CoBank shall
specify.

    

    SECTION
9.          Security.  The
Company’s obligations hereunder and, to the extent related hereto, the MLA,
shall be secured as provided in Section 2.04 of the MLA.

    

    SECTION
10.       Conditions
Precedent.  In addition to the conditions precedent set forth
in the MLA, CoBank’s obligation to
make the initial Loan to the Company hereunder is subject to the conditions
precedent that CoBank shall have received each of the following (which in the
case of instruments or documents, must be originals, duly executed, and in form
and content acceptable to CoBank): (A) an amended and restated comfort letter
and agreement from Middlesex Water; (B) an amendment to the Mortgage (the “Mortgage Amendment”);
(C) such evidence as CoBank shall require that the Mortgage Amendment has been
recorded in all places where the Mortgage has been recorded; (D) a lien search
conducted in the office of the Delaware Secretary of State showing that there
are no Liens on any property of the Company other than Liens in favor of CoBank
and Liens permitted under Section 6.01 of the MLA; and (E) an endorsement to the
“Title Policy” (as hereinafter defined) adding this Promissory Note and
Supplement to the list of debt instruments secured by the Mortgage and insured
under  the Title Policy. For purposes hereof, the “Title Policy” shall
mean that certain title insurance

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    policy
dated as of May 23, 2003 and issued by Stewart Title Guaranty Company, as
endorsed to the date hereof.

    

    SECTION
11.       Representations and Warranties.
In addition to the representations and warranties set forth in the MLA,
the Company represents and warrants to CoBank that Appendix B to the Mortgage
(as amended) sets forth all real property and interests in real property of the
Company as of the date hereof, including without limitation, all real property
on or under which the Company has a well, water treatment plant,  or
water storage facility.

    

    IN WITNESS WHEREOF, the
parties have caused this Promissory Note and Supplement to be executed by their
duly authorized officers as of the date shown above.

    

    
      	
              CoBANK,
      ACB

            	 
      	
              TIDEWATER
      UTILITIES, INC.

            
	 
      	 
      	 
      	 
      	 
      
	
              By:

            	
              /s/Tokie
      Akrie

            	 
      	
              By:

            	
              /s/A.
      Bruce O’Connor

            
	 
      	 
      	 
      	 
      	 
      
	
              Title:

            	
              Assistant
      Corporate Secretary

            	 
      	
              Title:

            	
              Treasurer

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