Document:

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                                                                     Exhibit 4.1

                               FIRST SUPPLEMENT
              TO INDENTURE OF TRUST, DATED AS OF OCTOBER 1, 1998

          THIS FIRST SUPPLEMENT TO INDENTURE OF TRUST, dated as of June 29,
2000, (this "First Supplement") between SOUTH JERSEY GAS COMPANY, a corporation
organized and existing under the laws of the State of New Jersey (the
"Company"), and THE BANK OF NEW YORK, a New York banking corporation, as trustee
(the "Trustee") under the Indenture of Trust hereinafter mentioned.

                                  WITNESSETH

          WHEREAS, the Company has heretofore duly executed, acknowledged and
delivered to the Trustee, a certain Indenture of Trust, dated as of October 1,
1998 (the "Original Indenture" and as supplemented by this First Supplement, the
"Indenture") to provide for the issuance of its Secured Medium Term Notes; and

          WHEREAS, the Company is making provisions for the issuance and sale of
its Secured Medium Term Notes, Series A, 2000-1, Series A, 2000-2 and Series A,
2000-3 to be issued under the Indenture, which notes (the "Insured Notes") shall
be insured by Ambac Assurance Corporation; and

          WHEREAS, Ambac Assurance Corporation requires the addition of certain
provisions to the Indenture set forth in this First Supplement in connection
with its issuance of a financial guaranty insurance policy with respect to such
insurance; and

          WHEREAS, the execution and delivery of this First Supplement have been
duly authorized by the Board of Directors of the Company at a meeting duly
called and held according to law; and

          WHEREAS, all acts and things prescribed by law, by the charter and
bylaws of the Company and by the Indenture necessary to make the Insured Notes,
when executed by the Company and authenticated by the Trustee as provided in the
Indenture, valid, binding and legal obligations of the Company, and to make this
First Supplement a valid, binding and legal instrument in accordance with its
terms, have been done, performed and fulfilled, and the execution and delivery
hereof have been in all respects duly authorized.

          NOW THEREFORE, THIS FIRST SUPPLEMENT TO INDENTURE WITNESSETH:

          That in order to declare the terms and conditions upon which the
Insured Notes are to be authenticated, issued and delivered and in consideration
of the premises and of the purchase and acceptance of the Insured Notes by the
Noteholders thereof and the sum of One Dollar duly paid to it by the Trustee at
the execution of this First Supplement, the receipt whereof is hereby
acknowledged, the Company covenants and agrees with the Trustee for the equal
and proportionate benefit of the respective Noteholders from time to time of
Insured Notes,
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as follows (Capitalized terms used but not otherwise defined herein shall have
the meanings set forth in the Indenture):

                                  ARTICLE ONE

                            ADDITIONAL DEFINITIONS

SECTION 1.1    DEFINITIONS

     AMBAC ASSURANCE

     The term "Ambac Assurance" shall mean Ambac Assurance Corporation, a
Wisconsin-domiciled stock insurance company, and its successors and assigns.

     FINANCIAL GUARANTY INSURANCE POLICY

     The term "Financial Guaranty Insurance Policy" shall mean the financial
guaranty insurance policy issued by Ambac Assurance insuring the payment when
due of the principal of and interest on the Insured Notes as provided therein.

     INSURED NOTEHOLDER

     The term "Insured Noteholder" shall mean a Noteholder of the Insured Notes.

                                  ARTICLE TWO

                                 AMBAC CONSENT

SECTION 2.1    CONSENT OF AMBAC ASSURANCE

     Any provision of the Indenture expressly recognizing or granting rights in
or to Ambac Assurance may not be amended in any manner which affects the rights
of Ambac Assurance hereunder without the prior written consent of Ambac
Assurance.

SECTION 2.2    CONSENT OF AMBAC ASSURANCE IN ADDITION TO INSURED NOTEHOLDER
               CONSENT

     Unless otherwise provided in this Section, Ambac Assurance's consent shall
be required in addition to any requisite Insured Noteholder consent for the
following purposes: (i) the execution and delivery of any supplemental Indenture
or any amendment, supplement or change to or modification of the Indenture that
affects Ambac Assurance or the Insured Noteholders; (ii) the removal of the
Trustee and selection and appointment of any successor trustee; and (iii) the
initiation or approval of any action not described in (i) or (ii) above which
requires consent of the Insured Noteholders.

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SECTION 2.3    CONSENT OF AMBAC ASSURANCE UPON DEFAULT; ACCELERATION RIGHTS

     (a) Anything in the Indenture to the contrary notwithstanding, upon the
occurrence and continuance of an Event of Default, Ambac Assurance shall be
entitled to control and direct the enforcement of all rights and remedies
granted to the Insured Noteholders or the Trustee for the benefit of the Insured
Noteholders under the Indenture, only to the extent the Insured Noteholders had
such rights and remedies under the Indenture, including, without limitation: (i)
the right to accelerate the principal of the Insured Notes as described in the
Indenture; and (ii) the right to annul any declaration of acceleration, and
Ambac Assurance shall also be entitled to approve all waivers of Events of
Default by or on behalf of the Insured Noteholders.

     (b) Upon the occurrence of an Event of Default which is continuing, the
Trustee may, with the consent of Ambac Assurance, and shall, at the direction of
Ambac Assurance or a majority of the Insured Noteholders with the consent of
Ambac Assurance, by written notice to the Company and Ambac Assurance, declare
the principal of the Insured Notes to be immediately due and payable, whereupon
that portion of the principal of the Insured Notes thereby coming due and the
interest thereon accrued to the date of payment shall, without further action,
become and be immediately due and payable, anything in the Indenture or in the
Insured Notes to the contrary notwithstanding.

                                 ARTICLE THREE

                   NOTICES/INFORMATION TO BE GIVEN TO AMBAC

SECTION 3.1    INFORMATION FOR SURVEILLANCE DEPARTMENT

     As long as the Financial Guaranty Insurance Policy is in effect, the
Company or the Trustee, as appropriate, shall furnish to the Surveillance
Department of Ambac Assurance:

         (a) as soon as practicable after the filing thereof with the Securities
and Exchange Commission, a copy of any financial statements of the Company and a
copy of any audit and annual report of the Company filed therewith;

         (b) such additional information Ambac Assurance may reasonably request;
and

         (c) a copy of any notice to be given to the registered owners of the
Insured Notes, including without limitation, notice of any redemption of or
defeasance of any Insured Notes, and any certificate rendered pursuant to the
Indenture relating to the security for the Insured Notes.

SECTION 3.2    INFORMATION FOR GENERAL COUNSEL'S OFFICE

     (a) The Trustee or the Company, as appropriate, shall notify the General
Counsel's Office of Ambac Assurance of any failure of the Company to provide
relevant notices, certificates, or other documents required to be provided under
the Indenture with respect to the Notes.

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     (b) Notwithstanding any other provision of the Indenture, the Trustee or
the Company, as appropriate, shall promptly notify the General Counsel's Office
of Ambac Assurance if at any time there are insufficient moneys to make any
payments of principal and/or interest as required with respect to the Insured
Notes and promptly upon the occurrence of any Event of Default under the
Indenture.

SECTION 3.3    OTHER INFORMATION RIGHTS

     The Company will permit Ambac Assurance to discuss the affairs, finances
and accounts of the Company or any information Ambac Assurance may reasonably
request regarding the security for the Insured Notes with appropriate officers
of the Company.  The Trustee or the Company, as appropriate, will permit Ambac
Assurance to have access to and to make copies of all books and records relating
to the Insured Notes at any reasonable time.  Ambac Assurance will keep all such
information confidential and will use such information solely for purposes of
monitoring its responsibilities with respect to the Insured Notes.

                                 ARTICLE FOUR

                                  DEFEASANCE

SECTION 4.1    DEFEASANCE

     (a) The definition of "Outstanding" in the Indenture with respect to the
Insured Notes shall include Insured Notes as described in Section 4.1 (b) below.

     (b) Notwithstanding anything herein to the contrary, in the event that the
principal and/or interest due on the Insured Notes shall be paid by Ambac
Assurance pursuant to the Financial Guaranty Insurance Policy, the Insured Notes
shall (i) remain Outstanding for all purposes; (ii) not be defeased or otherwise
satisfied; and (iii) not be considered paid by the Company, and the assignment
and pledge of the Pledged First Mortgage Bond and all covenants, agreements and
other obligations of the Company to the registered owners of the Insured Notes
shall continue to exist and shall run to the benefit of Ambac Assurance, and
Ambac Assurance shall be subrogated to the rights of such registered owners.

                                 ARTICLE FIVE

     PAYMENT PROCEDURE PURSUANT TO THE FINANCIAL GUARANTY INSURANCE
                                    POLICY

SECTION 5.1    PROCEDURES

     As long as the insurance on the Insured Notes shall be in full force and
effect, the Company and the Trustee agree to comply with the following
provisions:

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     (a) At least one (1) day prior to all Interest Payment Dates with respect
to any Insured Notes, the Trustee or paying agent, if any, will determine
whether there will be sufficient funds available to pay the principal of or
interest on the Insured Notes on such Interest Payment Date. If the Trustee or
paying agent, if any, determines that there will be insufficient funds
available, the Trustee or paying agent, if any, shall so notify Ambac Assurance.
Such notice shall specify the amount of the anticipated deficiency, the Insured
Notes to which such deficiency is applicable and whether such Insured Notes will
be deficient as to principal or interest, or both. If the Trustee or paying
agent, if any, has not so notified Ambac Assurance at least one (1) day prior to
an Interest Payment Date, Ambac Assurance will make payments of principal or
interest due on the Insured Notes on or before the first (1st) day next
following the date on which Ambac Assurance shall have received notice of
nonpayment from the Trustee or paying agent, if any.

     (b) The Trustee or paying agent, if any, shall, after giving notice to
Ambac Assurance as provided in Section 5.1(a) above, make available to Ambac
Assurance and, at Ambac Assurance's direction, to the United States Trust
Company of New York, as insurance trustee for Ambac Assurance or any successor
insurance trustee (the "Insurance Trustee"), the registration books of the
Company maintained by the Trustee or paying agent, if any, and all records
relating to the Insured Notes maintained under the Indenture.

     (c) The Trustee or paying agent, if any, shall provide Ambac Assurance and
the Insurance Trustee with a list of registered owners of Insured Notes entitled
to receive principal or interest payments from Ambac Assurance under the terms
of the Financial Guaranty Insurance Policy, and shall make arrangements with the
Insurance Trustee (i) to mail checks to the registered owners of Insured Notes
entitled to receive full or partial interest payments from Ambac Assurance and
(ii) to pay principal upon Insured Notes surrendered to the Insurance Trustee by
the registered owners of Insured Notes entitled to receive full or partial
principal payments from Ambac Assurance.

     (d) The Trustee or paying agent, if any, shall, at the time it provides
notice to Ambac Assurance pursuant to Section 5.1(a) above, notify registered
owners of Insured Notes entitled to receive the payment of principal or interest
thereon from Ambac Assurance (i) as to the fact of such entitlement; (ii) that
Ambac Assurance will remit to them all or a part of the interest payments next
coming due upon proof of Insured Noteholder entitlement to interest payments and
delivery to the Insurance Trustee, in form reasonably satisfactory to the
Insurance Trustee, of an appropriate assignment of the registered owner's right
to payment; (iii) that should they be entitled to receive full payment of
principal from Ambac Assurance, they must surrender their Insured Notes (along
with an appropriate instrument of assignment in form reasonably satisfactory to
the Insurance Trustee to permit ownership of such Insured Notes to be registered
in the name of Ambac Assurance) for payment to the Insurance Trustee, and not
the Trustee or paying agent, if any, and (iv) that should they be entitled to
receive partial payment of principal from Ambac Assurance, they must surrender
their Insured Notes for payment thereon first to the Trustee or paying agent, if
any, who shall note on such Insured Notes the portion of the principal paid by
the Trustee or paying agent, if any, and then, along with an appropriate
instrument of assignment in form reasonably satisfactory to the Insurance
Trustee, to the Insurance Trustee, which will then pay the unpaid portion of
principal.

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     (e) In the event that the Trustee or paying agent, if any, has notice that
any payment of principal of or interest on an Insured Note which has become due
for payment and which is made to an Insured Noteholder by or on behalf of the
Company has been deemed a preferential transfer and theretofore recovered from
its registered owner pursuant to the United States Bankruptcy Code or any other
federal or state bankruptcy, insolvency or preferential payment statute by a
trustee in bankruptcy or other appropriate person in accordance with the final,
nonappealable order of a court having competent jurisdiction, the Trustee or
paying agent, if any, shall, at the time Ambac Assurance is notified pursuant to
(a) above, notify all registered owners that in the event that any registered
owner's payment is so recovered, such registered owner will be entitled to
payment from Ambac Assurance to the extent of such recovery if sufficient funds
are not otherwise available, and the Trustee or paying agent, if any, shall
furnish to Ambac Assurance its records evidencing the payments of principal of
and interest on the Insured Notes which have been made by the Trustee or paying
agent, if any, and subsequently recovered from registered owners and the dates
on which such payments were made.

     (f) In addition to those rights granted Ambac Assurance under the
Indenture, Ambac Assurance shall, to the extent it makes payment of principal of
or interest on Insured Notes, become subrogated to the rights of the recipients
of such payments in accordance with the terms of the Financial Guaranty
Insurance Policy, and to evidence such subrogation (i) in the case of
subrogation as to claims for past due interest, the Trustee or paying agent, if
any, shall note Ambac Assurance's rights as subrogee on the registration books
of the Company maintained by the Trustee or paying agent, if any, upon receipt
from Ambac Assurance of proof of the payment of interest thereon to the
registered owners of the Insured Notes; and (ii) in the case of subrogation as
to claims for past due principal, the Trustee or paying agent, if any, shall
note Ambac Assurance's rights as subrogee on the registration books of the
Company maintained by the Trustee or paying agent, if any, upon surrender of the
Insured Notes by the registered owners thereof together with proof of the
payment of principal thereof.

                                  ARTICLE SIX

                          TRUSTEE-RELATED PROVISIONS

SECTION 6.1    SPECIAL RULES REGARDING TRUSTEE

     (a) The Trustee or paying agent, if any, may be removed only with the
consent of Ambac Assurance, for any breach of the obligations set forth in the
Indenture.

     (b) Ambac Assurance shall receive prior written notice from the Company of
the resignation of any Trustee or paying agent, if any.

     (c) Every successor Trustee appointed pursuant to Section 9.11 of the
Indenture shall be a trust company or bank in good standing located in or
incorporated under the laws of the state of its organization, duly authorized to
exercise trust powers and subject to examination by federal or state authority,
having a reported capital and surplus of not less than $50,000,000 and
reasonably

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acceptable to Ambac Assurance. Any successor paying agent, if applicable, shall
not be appointed unless Ambac Assurance approves such successor in writing, such
approval not to be unreasonably withheld.

     (d) Notwithstanding any other provision of the Indenture, in determining
whether the rights of the Insured Noteholders will be adversely affected by any
action taken pursuant to the terms and provisions of the Indenture, the Trustee
(or paying agent) shall consider the effect on the Insured Noteholders as if
there were no Financial Guaranty Insurance Policy.

     (e) Notwithstanding any other provision of the Indenture, no removal,
resignation or termination of the Trustee or paying agent, if any, with respect
to any Insured Notes shall take effect until a successor, reasonably acceptable
to Ambac, shall be appointed.  If a successor Trustee has not been accepted by
Ambac Assurance within 60 days after a notice of removal or resignation has been
delivered, the Trustee may petition a court of competent jurisdiction at the
expense of the Company to appoint a successor trustee.

                                 ARTICLE SEVEN

                              INTERESTED PARTIES

SECTION 7.1    AMBAC ASSURANCE AS THIRD PARTY BENEFICIARY

     To the extent that the Indenture confers upon or gives or grants to Ambac
Assurance any right, remedy or claim under or by reason of the Indenture, Ambac
Assurance is hereby explicitly recognized as being a third-party beneficiary
hereunder and may enforce any such right remedy or claim conferred, given or
granted hereunder.

SECTION 7.2    PARTIES INTERESTED IN THE INDENTURE

     Nothing in the Indenture expressed or implied is intended or shall be
construed to confer upon, or to give or grant to, any person or entity, other
than the Company, the Trustee, Ambac Assurance, the paying agent, if any, and
the registered owners of all Notes, any right, remedy or claim under or by
reason of the Indenture or any covenant, condition or stipulation of the
Indenture, and all covenants, stipulations, promises and agreements in the
Indenture contained by and on behalf of the Company shall be for the sole and
exclusive benefit of the Company, the Trustee, Ambac Assurance, the paying
agent, if any, and the registered owners of the Notes.

                                 ARTICLE EIGHT

                                 MISCELLANEOUS

SECTION 8.1    EFFECT ON INDENTURE

     As supplemented by the First Supplement, the Indenture is in all respects
ratified and confirmed, and the Indenture, including the First Supplement, shall
be read as one instrument.  All

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terms used in the First Supplement shall have the same meaning as used elsewhere
in the Indenture except where the context clearly indicates otherwise.

SECTION 8.2    COUNTERPARTS

     The First Supplement may be executed in several counterparts, each of which
shall be considered an original and all collectively as one and the same
instrument.

SECTION 8.3    TERMINATION

     All rights granted to Ambac Assurance hereunder shall terminate and be of
no further force and effect at the time that there are no Insured Notes
outstanding under the Indenture.

     IN WITNESS WHEREOF, South Jersey Gas Company has caused this First
Supplement to the Indenture to be signed and acknowledged by one of its Vice
Presidents and attested by its Secretary, and The Bank of New York has caused
this Indenture to be signed by one of its authorized signatories, as of the day
and year first written above.

                                   SOUTH JERSEY GAS COMPANY

                                   By: /s/ David A. Kindlick
                                       --------------------------------------
                                             David A. Kindlick
                                             Senior Vice President,
                                             Finance and Rates

                                             ATTEST: /s/ Richard H. Walker
                                                     ---------------------------
                                                         Richard H. Walker
                                                         Assistant Secretary

                                   THE BANK OF NEW YORK

                                   By: /s/ Marie Trimboli
                                       --------------------------------------
                                   Name: Marie Trimboli
                                   Title: Assistant Treasurer

                                       8<PAGE>

                                                                     Exhibit 4.2

                               SECOND SUPPLEMENT
               TO INDENTURE OF TRUST, DATED AS OF OCTOBER 1, 1998

          THIS SECOND SUPPLEMENT TO INDENTURE OF TRUST, dated as of July 5,
2000, (this "Second Supplement") between SOUTH JERSEY GAS COMPANY, a corporation
organized and existing under the laws of the State of New Jersey (the
"Company"), and THE BANK OF NEW YORK, a New York banking corporation, as trustee
(the "Trustee") under the Indenture of Trust hereinafter mentioned.

                                   WITNESSETH

          WHEREAS, the Company has heretofore duly executed, acknowledged and
delivered to the Trustee, a certain Indenture of Trust, dated as of October 1,
1998 (the "Original Indenture," as supplemented by the First Supplement dated as
of June 29, 2000, and as further supplemented by this Second Supplement, the
"Indenture") to provide for the issuance of its Secured Medium Term Notes; and

          WHEREAS, the Company desires to make provisions for the issuance and
sale of its Secured Medium Term Notes to be issued under the Indenture, which
notes may, at the election of the Company as set forth in a Company Order, be
subject to redemption at the request of the representatives of deceased
noteholders, under certain conditions (the "RHO Notes"); and

          WHEREAS, the Company desires to supplement the provisions of the
Original Indenture to provide for such redemptions; and

          WHEREAS, the execution and delivery of this Second Supplement have
been duly authorized by the Offering Committee of the Board of Directors of the
Company at a meeting duly called and held according to law; and

          WHEREAS, all acts and things prescribed by law, by the charter and
bylaws of the Company and by the Indenture necessary to make the RHO Notes, when
executed by the Company and authenticated by the Trustee as provided in the
Indenture, valid, binding and legal obligations of the Company, and to make this
Second Supplement a valid, binding and legal instrument in accordance with its
terms, have been done, performed and fulfilled, and the execution and delivery
hereof have been in all respects duly authorized.

          NOW THEREFORE, THIS SECOND SUPPLEMENT TO INDENTURE WITNESSETH:

          That in order to declare the terms and conditions upon which the RHO
Notes are to be authenticated, issued and delivered and in consideration of the
premises and of the purchase and acceptance of the RHO Notes by the Noteholders
thereof and the sum of One Dollar duly paid to it by the Trustee at the
execution of this Second Supplement, the receipt whereof is hereby acknowledged,
the Company covenants and agrees with the Trustee for the equal and
proportionate benefit of the respective Noteholders from time to time of RHO
Notes, as follows
<PAGE>

(Capitalized terms used but not otherwise defined herein shall have the meanings
set forth in the Indenture):

                             ADDITIONAL DEFINITIONS

SECTION 1.1    DEFINITIONS

     For purposes of this Second Supplement, the following terms shall have the
following meanings:

     BENEFICIAL OWNER

     The term "Beneficial Owner" shall mean the person who has the right to
sell, transfer or otherwise dispose of an interest in RHO Notes and the right to
receive the proceeds therefrom, as well as the interest and principal payable to
the Noteholder thereof.

     PARTICIPANT

     The term "Participant" shall mean one of the participating organizations
for which the Depository holds the Global Note.

                                  ARTICLE TWO

                        ADDITIONAL REDEMPTION PROVISIONS

SECTION 2.1    GENERAL

     Notwithstanding any provisions of the Original Indenture (including,
without limitation, Article Three thereof) any Notes designated as RHO Notes in
a Company Order with respect to such Notes shall also be subject to redemption
in the manner and to the extent provided in this Article Two, except as the
specific terms of Article Two may be modified in the Company Order with respect
to such Notes.

SECTION 2.2    REDEMPTION AT THE HOLDER'S OPTION

     (a) A determination of beneficial ownership in the RHO Notes will be
determined by the Company, in its sole discretion, which determinations shall be
final and binding on all parties.

     (b) Unless the RHO Notes have been declared due and payable prior to their
maturity by reason of an Event of Default, the personal representative or other
Person authorized to represent the estate of the deceased Beneficial Owner or
from a surviving joint tenant(s) or tenant(s) by the entirety (each, a
"Representative") of a deceased Beneficial Owner has the right to request
redemption prior to the maturity of all or part of such interest, expressed in
integral multiples of $1,000 principal amount, in the RHO Notes, and the Company
will redeem the same subject to the limitations that the Company will not be
obligated to redeem, during the period

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<PAGE>

from the Original Issue Date through and including the first anniversary of the
Original Issue Date or such other period as set forth in the Company Order with
respect to such Notes (the "Initial Period"), and during any twelve-month period
which ends on and includes each anniversary date thereafter or such other period
as set forth in the Company Order with respect to such Notes (each such period
being hereinafter referred to as a "Subsequent Period") on behalf of a deceased
Beneficial Owner, (1) any ownership interest in RHO Notes which exceeds the
aggregate principal amount set forth in the Company Order for such Notes (the
"Individual Limitation"); or (2) ownership interests in RHO Notes for all
Representatives of deceased Beneficial Owners so requesting redemption in an
aggregate principal amount exceeding the amount set forth in the Company Order
for such Notes (the "Aggregate Limitation").

     (c) A request for redemption in the form attached as Schedule I hereto may
be initiated by the Representative of a deceased Beneficial Owner at any time
and in any principal amount in integral multiples of $1,000.  Representatives of
deceased Beneficial Owners must make arrangements with the Participant through
whom such interest is owned in order that timely presentation of redemption
requests can be made by the Participant to the Trustee.  If the Company,
although not obligated to do so, chooses to redeem interests of any deceased
Beneficial Owner in the RHO Notes in the Initial Period or in any Subsequent
Period in excess of the applicable Individual Limitation, such redemption, to
the extent that it exceeds the Individual Limitation for any deceased Beneficial
Owner, shall not be included in the computation of the Aggregate Limitation for
such Initial Period or such Subsequent Period, as the case may be, or for any
succeeding Subsequent Period.  Any RHO Notes (or portion thereof) tendered
pursuant to a redemption request may be withdrawn by a written request by the
Representative received by the Trustee at least ten (10) days prior to its
repayment.

     (d)  Subject to the Individual Limitation and the Aggregate Limitation, the
Company will, after the death of any Beneficial Owner, redeem the interest of
the Beneficial Owner in the RHO Notes within 60 days following receipt by the
Trustee of a redemption request .  The Trustee will notify the Company promptly
after receipt of any redemption request and the Company will provide all funds
necessary for such redemption prior to the date of redemption to the Trustee.
If, during the Initial Period or any Subsequent Period, redemption requests
exceed the applicable Aggregate Limitation required to be redeemed, then such
excess redemption requests will be applied to successive Subsequent Periods,
regardless of the number of Subsequent Periods required to redeem such
interests.  All Redemption Requests will be redeemed in the order in which the
Trustee receives the Redemption Requests, subject to the Individual Limitation
and Aggregate Limitation.

     (e) To obtain repayment pursuant to a redemption request, the
Representative must provide to the Participant (i) a written request for
repayment signed by the Representative, and such signature must be guaranteed by
a member firm of a registered national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD") or a commercial bank or trust
company having an office or correspondent in the United States, (ii) appropriate
evidence satisfactory to the Company and the Trustee that (1) the Representative
has authority to act on behalf of the deceased Beneficial Owner, (2) the death
of such Beneficial Owner has occurred and (3) the deceased was the owner of a
beneficial interest in such RHO Notes at the time of death, (iii) if applicable,
a properly executed assignment or endorsement, and (iv) if the

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<PAGE>

beneficial interest in such RHO Notes is held by a nominee of the deceased
Beneficial Owner, a certificate satisfactory to the Trustee from such nominee
attesting to the deceased's ownership of a beneficial interest in such RHO
Notes. The Participant will provide these documents to the Trustee. All
questions as to the eligibility or validity of any exercise of redemption on
behalf of a deceased Beneficial Owner will be determined by the Company, in its
sole discretion, which determinations will be final and binding on all parties.

     (f) For purposes of this Article Two, an interest in RHO Notes held in
tenancy by the entirety, joint tenancy or by tenants in common will be deemed to
be held by a single Beneficial Owner and the death of a tenant by the entirety,
joint tenant or tenant in common will be deemed the death of a Beneficial Owner.
The death of a Person who, during his lifetime, was entitled to substantially
all of the rights of a Beneficial Owner of an interest in the RHO Notes will be
deemed the death of the Beneficial Owner, regardless of the recordation of such
interest on the records of the Participant, if such rights can be established to
the satisfaction of the Participant, if any, and the Company.

     (g) In the case of any redemption request which is presented pursuant to
this Article Two and which has not been fulfilled at the time the Company gives
notice of its election to partially redeem RHO Notes pursuant to the Article
Three of the Original Indenture, such interest or portion thereof shall not be
subject to redemption pursuant to such Article Three, but shall remain subject
to redemption pursuant to this Article Two.

                                 ARTICLE THREE

                                 MISCELLANEOUS

SECTION 3.1    EFFECT ON INDENTURE

     As supplemented by the Second Supplement, the Indenture is in all respects
ratified and confirmed, and the Indenture, including the First Supplement and
the Second Supplement, shall be read as one instrument.

SECTION 3.2    COUNTERPARTS

     The Second Supplement may be executed in several counterparts, each of
which shall be considered an original and all collectively as one and the same
instrument.

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<PAGE>

     IN WITNESS WHEREOF, South Jersey Gas Company has caused this Second
Supplement to the Indenture to be signed and acknowledged by one of its Vice
Presidents and attested by its Secretary, and The Bank of New York has caused
this Indenture to be signed by one of its authorized signatories, as of the day
and year first written above.

                                  SOUTH JERSEY GAS COMPANY

                                  By:   /s/ David A. Kindlick
                                       ------------------------------
                                            David A. Kindlick
                                            Senior Vice President,
                                            Finance and Rates

                                            ATTEST:  /s/ Richard H. Walker
                                           -----------------------------------
                                                     Richard H. Walker
                                                     Assistant Secretary

                                  THE BANK OF NEW YORK

                                  By:   /s/ Marie Trimboli
                                       ----------------------------------------
                                  Name: Marie Trimboli
                                  Title: Assistant Treasurer

                                       5
<PAGE>

                                   Schedule I
                                   ----------

                         FORM OF REQUEST FOR REDEMPTION
                            SOUTH JERSEY GAS COMPANY
                       Secured Medium Term Note, Series A
                 (_____% Secured Medium Term Notes due _______)
                       CUSIP No.________________________

          The undersigned Participant does hereby certify, pursuant to Section
2.2(c) of the Second Supplement to Indenture dated as of July 5, 2000 to the
Indenture dated as of October 1, 1998 between South Jersey Gas Company (the
"Company") and The Bank of New York, as trustee (the "Trustee"), to the Company
and the Trustee that:

I.   [Name of deceased Beneficial Owner] is deceased.

II.  [Name of deceased Beneficial Owner] had an interest in $ in face principal
     amount of the Company's Secured Median Term Note, Series A, Series ________
     (also known as ________ Notes) due _______ (the "Notes").

III. [Name of Representative] is [Beneficial Owner's personal
     representative/other person authorized to represent the estate of the
     Beneficial Owner/surviving joint tenant/surviving tenant by the entirety]
     of [Name of deceased Beneficial Owner] and has delivered to the undersigned
     a request for redemption in form satisfactory to the undersigned,
     requesting that $ [$1,000 or an integral multiple thereof] be redeemed
     pursuant to said Section 2.2(c). Such request and the documents
     accompanying such request, all of which are satisfactory to the
     undersigned, are delivered herewith.

IV.  [Name of Participant] holds the interest in the Notes with respect to which
     this Request for Redemption is being made on behalf of [Name of deceased
     Beneficial Owner].

          IN WITNESS WHEREOF, the undersigned has executed this Request for
Redemption as of ___________________, _____.

                                       [Name of Participant]

                                       By:________________________________

                                       Name:______________________________

                                       Title:_____________________________

                                       6

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