Document:

Loan No. RX1447A

    FIRST AMENDMENT TO MASTER LOAN AGREEMENT

     

    THIS FIRST AMENDMENT TO MASTER LOAN AGREEMENT (this "Amendment" ) is entered into as of January 10, 2019, between ARTESIAN WASTEWATER MANAGEMENT, INC, a corporation organized and existing under the laws of the State of Delaware (the "Company"), and CoBANK, ACB, a federally chartered
          instrumentality of the United States ("Co Bank"),

     

    BACKGROUND

     

    CoBank and the Company are parties to a Master Loan Agreement dated as of August 8, 2018 (the "MLA"). The parties now desire to amend
        the MLA.

     

    NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and CoBank
      agree as follows:

     

    SECTION 1. Definitions. Capitalized terms used herein and not defined herein shall have the
      meanings given to those terms in the MLA.

     

    SECTION 2. Amendments.

     

    (A) Amendment to Definition of "Debt Service Coverage Ratio". The definition of the term
      "Debt Service Coverage Ratio" in Exhibit A of the MLA is hereby amended and restated to read as follows:

     

    "Debt Service Coverage Ratio" shall
        mean the ratio of: (1) net income (after taxes and after eliminating any gain or loss on sale of assets or other extraordinary gain or loss), plus depreciation expense, non-cash income taxes, amortization expense, and interest expense, minus
        non-cash patronage, and non-cash income from Subsidiaries and/or joint ventures, and minus grant income; to

    (2) all principal payments due within the period on all Long Term Debt plus interest expense, but excluding non-cash interest expense payable to affiliates (all as calculated
        for the Company on an unconsolidated basis for the applicable fiscal year in accordance with GAAP consistently applied
        or the appropriate standards of the regulatory agency having jurisdiction over the
        Company).

     

    (B) Amendment to Compliance Certificate. Exhibit B to the MLA is hereby amended
        and restated to read as set
          forth on the Exhibit to this Amendment.

     

    SECTION 3. Representations and Warranties.
        To induce CoBank to enter into this Amendment, the Company represents and warrants that: (A) no consent, permission, authorization, order or license of any governmental authority or of any party to any agreement to which the Company is a party or by which it or any of its property may be bound
      or affected, is necessary in connection with the execution, delivery, performance or enforcement of this Amendment;
      (B) the Company is in compliance with all of the terms of the Credit Documents, and no Default or Event of Default exists; and (C) this Amendment has been duly
        authorized, executed and delivered by the Company, and creates legal, valid, and binding obligations of the Company which are enforceable in accordance with their terms, except to the extent that enforceability may be limited
        by applicable bankruptcy, insolvency or similar laws affecting the rights of creditors generally.

    

    

    SECTION 4. Confirmation. Except as amended hereby, the MLA shall remain in full force and effect as written.

     

    SECTION 5. Counterparts and Electronic Delivery. This Amendment may be executed in counterparts (and by different parties in different counterparts), each of which shall constitute an original, and all of which when taken
        together shall constitute a single agreement. In addition, this Amendment may be delivered by electronic means,

     

    (Signature Page Follows)

    

    

    
      1

      
        

    

    

    

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

    

    

    	
            CoBANK, ACB

          	 	 	
            ARTESIAN WASTEWATER MANAGEMENT, INC.

          
	 	 	 	 	 
	
            By:

          	
            /s/ Christen Spencer

          	 	
            By:

          	
            /s/ David B. Spacht

          
	
            Title:

          	
            Assistant Corporate Secretary

          	 	
            Title:

          	
            CFO Treasurer

          

    

    

    
      2MLA No. RX1447B

    SECOND AMENDMENT TO

    MASTER LOAN AGREEMENT

     

    THIS SECOND AMENDMENT TO MASTER LOAN
        AGREEMENT (this “Amendment”) is entered into as of November 13, 2019, between ARTESIAN WASTEWATER MANAGEMENT, INC., a corporation organized and existing under the laws of the State of Delaware (the “Company”), and CoBANK, ACB, a federally chartered instrumentality of the United States (“CoBank”).

     

    BACKGROUND

     

    The Company and CoBank are parties to a Master Loan Agreement dated as of August 8, 2018 and numbered RX1447, as amended by a First
      Amendment to Master Loan Agreement dated as of January 10, 2019 (the “MLA”). The parties now desire to amend the MLA.

     

    NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

     

    SECTION 1.          Definitions. Capitalized terms used in this Amendment and not defined herein shall have the meanings given to those terms in the MLA.

     

    SECTION 2.          Amendment.  Section 6.22 of the MLA is hereby amended and restated to read as follows:

     

    SECTION

        6.22.  Debt Service Coverage Ratio.  Commencing with the fiscal year beginning on January 1, 2020 and ending on December 31, 2020, and for each fiscal year thereafter, the Company will have a Debt Service
        Coverage Ratio of not less than 1.25 to 1.00.

     

    SECTION 3.          Representations and Warranties.  To induce CoBank to enter into this Amendment, the Company represents and warrants that: (A) no consent,
          permission, authorization, order or license of any governmental authority or of any party to any agreement to which the Company is a party or by which it or any of its property may be bound or affected, is necessary in connection with the
          execution, delivery, performance or enforcement of this Amendment; (B) the Company is in compliance with all of the terms of the Credit Documents, and no Event of Default or Default exists; and (C) this Amendment has been duly authorized,
          executed and delivered by the Company, and creates legal, valid, and binding obligations of the Company which are enforceable in accordance with their terms, except to the extent that enforceability may be limited by applicable bankruptcy,
          insolvency or similar laws affecting the rights of creditors generally.

     

    SECTION 4. Confirmation. Except as modified herein, the MLA shall remain in full force and effect.

     

    SECTION 5. Counterparts and Electronic
        Delivery. This Amendment may be executed in counterparts (and by different parties in different counterparts), each of which shall constitute an original, and all of which when taken together shall constitute a
        single agreement. In addition, this Amendment may be delivered by electronic means.

     

    (Signature Page Follows)

     

    
      
         2

        

        

      

      
        

      
        

        

        

        

         

      

    

     

      

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

    

    

    	
            CoBANK, ACB

          	 	
            ARTESIAN WASTEWATER MANAGEMENT, INC.

          
	 	 	 
	 	 	 	 	 
	
            By:

          	 	 	
            By:

          	 
	 	 	 	 	 
	
            Title:

          	 	 	
            Title:

          	 

    

    

    

    

    
      3EXHIBIT 4.22

    

    

    DESCRIPTION OF SECURITIES

    REGISTERED PURSUANT TO SECTION 12 OF THE

    SECURITIES EXCHANGE ACT OF 1934

    

    

    The following description summarizes certain material terms of the Class A Non-Voting Common Stock, par value $1.00 per share, of
      Artesian Resources Corporation (the “Company,” “we,” “us” and “our”), which are the only securities of the Company registered pursuant to Section 12 of the Securities Exchange Act of 1934.  This summary description of our Class A Non-Voting Common
      Stock does not purport to be complete and is qualified in its entirety by reference to our Restated Certificate of Incorporation and By-laws, copies of which are filed as exhibits to this Annual Report on Form 10-K and are incorporated by reference
      herein, and to the applicable provisions of Delaware and U.S. federal law.  We encourage you to read our Restated Certificate of Incorporation and By-laws, and the applicable provisions of Delaware and the U.S. federal law for additional information.

    

    

    General

    

    

    Our authorized capital stock consists of:

    

    

    
      	
              •

            	
              15,000,000 shares of Class A Non-Voting Common Stock, par value $1.00 per share

            

    

    
      	
              •

            	
              1,040,000 shares of Class B Common Stock, par value $1.00 per share

            

    

    
      	
              •

            	
              10,868 shares of 7% Prior Preferred Stock, par value $25.00 per share

            

    

    
      	
              •

            	
              80,000 shares of Cumulative Prior Preferred Stock, par value $25.00 per share

            

    

    
      	
              •

            	
              100,000 shares of Series Preferred Stock, par value $1.00 per share

            

    

    

    

    We sometimes refer to our 7% Prior Preferred Stock, Cumulative Prior Preferred Stock and Series Preferred Stock collectively as “Preferred
      Stock” in this "Description of Securities.”

    

    

    Class A Non-Voting Common Stock

     

    Voting Rights

    

    

    Under our Restated Certificate Incorporation, generally, holders of shares of our Class A Non-Voting Common Stock do not have voting rights with respect to
      the election of directors and other matters voted upon by stockholders. Except as otherwise described in this “Description of Securities,” the right to vote for the election of directors and other stockholder matters is exercised exclusively by the
      holders of Class B Common Stock.

    

    

    Section 242(b)(2) of the General Corporation Law of the State of Delaware confers voting rights (“statutory voting rights”) to holders of the outstanding
      shares of a class that are not entitled to vote under the certificate of incorporation, with respect to a proposed amendment to the certificate of incorporation, if “the amendment would increase or decrease the aggregate number of authorized shares
      of such class, increase or decrease the par value of the shares of such class, or alter or change the powers, preferences, or special rights of the shares of such class so as to affect them adversely.”  The vote required to approve such amendments is
      a majority of the outstanding shares of the class.

    

    

    As a result, holders of our Class A Non-Voting Common Stock have the statutory voting rights set forth above.  In addition, under Section 4.20 of our
      Restated Certificate of Incorporation, we may not issue any shares of Series Preferred Stock without the approval of the holders of a majority of the shares of Class A Non-Voting Common Stock.

    

    

    Dividends

    

    

    Subject to dividends that we may be required to pay on outstanding shares of Preferred Stock, the holders of Class A Non-Voting Common Stock are entitled
      to receive dividends, as, when and if declared from time to time by our Board of Directors out of funds legally available for such purpose.  Our Restated Certificate of Incorporation requires that we declare and pay the same dividend per share on the
      Class A Non-Voting Common Stock and on the Class B Common Stock.

    

    

    Liquidation Rights

    

    

    In the event of a liquidation, dissolution or winding up of the Company, the holders of Class A Non-Voting Common Stock are entitled to share pro rata with
      the holders of Class B Common Stock in all assets and funds remaining after we pay all of our creditors and make required distributions to the holders of outstanding shares of Preferred Stock pursuant to our Restated Certificate of Incorporation.

    

    

    Other Rights

    

    

    There are no preemptive, conversion, subscription, redemption or sinking fund rights applicable to the Class A Non-Voting Common Stock.

    

    

    All outstanding shares of our Class A Non-Voting Common Stock are fully paid and non-assessable.

    

    

    Listing

    

    

    Our Class A Non-Voting Common Stock is listed on the Nasdaq Global Select Market and trades under the symbol “ARTNA.”

    

    

    Preferred Stock

    

    

    The rights, preferences and privileges of our Class A Non-Voting Common Stock are subject to, and may be adversely affected by, the rights, preferences and
      privileges of any series of Preferred Stock that we may issue in the future.

    

    

    For example, if shares of 7% Prior Preferred Stock or Cumulative Prior Preferred Stock are issued, no dividends may be declared and paid on the Class A
      Non-Voting Common Stock unless the dividends on the 7% Prior Preferred Stock and Cumulative Prior Preferred Stock then outstanding have been paid. In addition, in the event of our liquidation, dissolution or winding up or our sale of all of our
      assets, the holders of any outstanding 7% Prior Preferred Stock and Cumulative Prior Preferred Stock are entitled, after we pay all of our creditors, to be paid in cash the par value of their shares and any accrued but unpaid dividends before we make
      any payment to the holders of our Class A Non-Voting Common Stock.

    

    

    In addition, our board of directors has the power to fix, subject to preferences that may be applicable to the 7% Prior Preferred Stock or Cumulative Prior
      Preferred Stock under our Restated Certificate of Incorporation, the full, limited or no voting powers, and such designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions
      thereof of any such series of Series Preferred Stock.

    

    

    There are no shares of Preferred Stock outstanding.

    

    

    Provisions with Possible Anti-Takeover Effects

     

    Our Restated Certificate of Incorporation provides that we will be governed by Section 203 of the General Corporation Law of the State of Delaware which
      prohibits a “business combination” between a corporation and an “interested stockholder” within three years of the stockholder becoming an “interested stockholder.”  An “interested stockholder” is one who, directly or indirectly, owns 15% or more of
      the outstanding voting stock of the corporation.  A “business combination” includes:

    

    

    
      	
              •

            	
              A merger;

            

    

    
      	
              •

            	
              Consolidation;

            

    

    
      	
              •

            	
              Sale or lease or other disposition of assets having an aggregate value in excess of 10% of either the aggregate fair market value of the consolidated assets of the
                corporation or the aggregate market value of all the outstanding stock of the corporation; and

            

    

    
      	
              •

            	
              Certain transactions that would increase the interested stockholder's proportionate share ownership in the corporation or which provide the interested stockholder
                with a financial benefit.

            

    

    

    

    These restrictions do not apply where:

    
      	
              •

            	
              Prior to such time the Company’s board of directors approved the business combination or the transaction which resulted in the stockholder becoming an interested
                stockholder;

            

    

    
      	
              •

            	
              Upon consummation of the transaction in which the stockholder became an interested stockholder, the stockholder owns at least 85% of the voting stock outstanding at
                the commencement of such transaction, excluding, for determining the number of shares outstanding, shares owned by persons who are directors as well as officers and by employee stock plans in which participants do not have the right to
                determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

            

    

    
      	
              •

            	
              The business combination is approved by the board of directors and the affirmative vote of two-thirds of the outstanding voting stock not owned by the interested
                stockholder at an annual or special meeting.

            

    

    

    

    The business combinations provisions of Section 203 of the General Corporation Law of the State of Delaware may have the effect of deterring merger
      proposals, tender offers or other attempts to effect changes in control of us that are not negotiated and approved by our board of directors.

    

    

    We have adopted certain provisions in our Restated Certificate of Incorporation and By-laws which may have anti-takeover implications.  Our Restated
      Certificate of Incorporation provides that without the affirmative vote of at least 75% of the voting power of all of the then outstanding shares entitled to vote generally in the election of directors, voting together as a class, the provisions in
      our Restated Certificate of Incorporation and the By-laws establishing a classified board of directors may not be altered, amended or repealed.  In addition, absent approval of our board of directors, our By-laws may only be amended or repealed by
      the affirmative vote of the holders of at least 75% of the voting power of all of the then-outstanding shares entitled to vote generally in the election of directors, voting together as a single class.  These supermajority voting provisions, along
      with various supermajority voting provisions for certain classes of stock required for certain business combinations and other corporate actions described above, may have an effect of discouraging, delaying or preventing a change of control which may
      be at a premium above the prevailing market price.

    
      1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}]]