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4(ii)(e)(7)
Contract No. MA-13629
TITLE XI RESERVE FUND
AND FINANCIAL AGREEMENT
THIS TITLE XI RESERVE FUND AND FINANCIAL AGREEMENT (the "Financial
Agreement") dated October 16, 2000 between Cape May Light, L.L.C., a Delaware
limited liability company (the "Company"), and THE UNITED STATES OF AMERICA (the
"United States"), represented by the SECRETARY OF TRANSPORTATION, acting by and
through the MARITIME ADMINISTRATOR (the "Secretary").
RECITALS
Pursuant to the conditions and understandings set forth in the Recitals
to the Security Agreement executed on this date, the Company has authorized the
issuance of obligations designated "United States Government Guaranteed Ship
Financing Bonds, 2000 Series" in an aggregate amount not to exceed $37,900,000
to finance the cost of construction of the cv Cape May Light (the "Vessel");
NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, and of other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereby agree as follows:
Section 1.
(a) Granting Clause. The Company hereby sells, grants, conveys,
mortgages, assigns, transfers, pledges, confirms and sets over to the Secretary
a continuing security interest in all of its right, title and interest in and to
(1) the Title XI Reserve Fund, and (2) all sums, instruments, moneys, negotiable
documents, chattel paper and proceeds thereof currently on deposit, or hereafter
deposited in the Title XI Reserve Fund.
(b) Definitions. For all purposes of this Financial Agreement, unless
otherwise expressly provided or unless the context otherwise requires, the
capitalized terms used herein shall have the meaning specified in Schedule X to
the Security Agreement entered into on this date.
SECTION 2. TITLE XI RESERVE FUND DEPOSITS.
(a) Pursuant to the Depository Agreement, the Company shall establish
with the Depository a depository account (herein called the "Title XI Reserve
Fund").
(b)(1) If for any fiscal year the Company shall fail to meet the
financial tests set forth in Section 8(b) hereof including the Proviso; the
Company shall, within 105 days after the end of each fiscal year of the Company,
compute its net income attributable to the operation of the Vessel ("Title XI
Reserve Fund Net Income"). This computation requires the multiplication of
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the Company's total net income after taxes by a fraction with a numerator
composed of the total original capitalized cost of the Vessel and a denominator
composed of the total original capitalized cost of all the Company's fixed
assets. The net income after taxes, computed in accordance with generally
accepted accounting principles, shall be adjusted as follows:
(A) The depreciation expense applicable to the fiscal year shall
be added back.
(B) There shall be subtracted an amount equal to the principal
amount of debt required to be paid or redeemed, and actually paid or redeemed by
the Company during the fiscal year; and the principal amount of Obligations
Retired or Paid, prepaid or redeemed, in excess of the required Redemptions or
payments which may be used by the Company as a credit against future required
Redemptions or other required payments with respect to the Obligations, but
excluding payments from the Title XI Reserve Fund and the Title XI Escrow Fund.
(2) Promptly after the computation of the Title XI Reserve Fund Net
Income by the Company:
(A) If the Vessel is owned by the Company, then from the Title XI
Reserve Fund Net Income for the Vessel there shall be deducted, annually, an
amount (pro rated for a period of less than a full fiscal year) which is 10% of
the Company's aggregate original equity investment in said Vessel, as specified
in Attachment A.
(B) The Company shall, unless otherwise approved by the Secretary
in writing, deposit into the Title XI Reserve Fund an amount equal to 50 percent
of the balance of the Title XI Reserve Fund Net income remaining after the above
deduction.
(C) Irrespective of the requirements that the Company make
deposits into the Title XI Reserve Fund, the Company shall not be required to
make any deposits into the Title XI Reserve Fund if (i) the Obligations and the
related Secretary's Note with respect to the Vessel shall have been satisfied
and discharged and if the Company shall have paid or caused to be paid all other
sums secured under the Security Agreement and the Mortgage, (ii) all of the
Guarantees on the Outstanding Obligations shall have been terminated pursuant to
the Security Agreement, or (iii) the amount (including any securities at current
market value) in the Title XI Reserve Fund is equal to, or in excess of 50% of
the aggregate principal amount of the Outstanding Obligations;
(D) The Company shall deliver to the Secretary (with a copy to the
Depository) at the time of each deposit into the Title XI Reserve Fund pursuant
to Section 2(b)(2)(B), and any deposits required under the Security Agreement, a
statement of an independent certified public accountant (who may be the regular
auditors for the Company) stating that such deposit has been computed in
accordance with Section 2(b)(2)(B), (and the Security Agreement, if applicable)
and showing the pertinent calculations.
(E) In addition, the Company shall deliver to the Secretary (with
a copy to the Depository), within 105 days after the end of each fiscal year of
the Company, a statement by
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such certified public accountant stating (i) the total amount of all deposits
which were required to be so deposited into the Title XI Reserve Fund for such
fiscal year (and showing the pertinent calculations), or (ii) that no such
deposit was required to be made for such fiscal year (and showing the pertinent
calculations) and that at the end of such fiscal year no adjustments pursuant to
Section 2(b)(2)(G) were required to be made (and, if such adjustments were
required to be made, stating the reasons therefor).
(F) The computation of all deposits required by this Section 2
shall be made on the basis of information available to the Company at the time
of each such deposit. Each such deposit shall be subject to adjustments from
time to time in the event and to the extent that the same would be required or
permitted by mistakes or omissions, additional information becoming available to
the Company, or judicial or administrative determinations made subsequent to the
making of such deposits.
Section 3. Withdrawals from the Title XI Reserve Fund.
(a) From time to time, moneys in the Title XI Reserve Fund shall be
subject to withdrawal by delivery by the Company to the Secretary of a Request
for Payment (specifying the Person or Persons to be paid and the amount of such
payment) executed by the Company, together with an Officer's Certificate of the
Company stating the reasons and the purpose for the withdrawal.
(b) Upon approval by the Secretary of the Request for Payment evidenced
by the countersignature thereon of the Secretary, the Secretary shall cause the
Request for Payment to be delivered to the Depository, which shall promptly make
payment to such Person or Persons in accordance with the terms of such Request
for Payment.
Section 4. Termination of the Title XI Reserve Fund.
(a) The Title XI Reserve Fund shall terminate at such time as the
Secretary's Note shall have been satisfied and discharged and the Company shall
have paid or caused to be paid all sums secured under the Security Agreement or
the Mortgage.
(b) Upon the termination of the Title XI Reserve Fund, pursuant to
Section 4(a), the moneys remaining in the Title XI Reserve Fund shall be subject
to withdrawal and payment into the general funds of the Company.
(c) Upon payment by the Secretary to the Indenture Trustee of the
Guarantees pursuant to the Indenture, the Title XI Reserve Fund shall, upon
written instructions of the Secretary, be terminated and the balance remaining
in the Title XI Reserve Fund shall be paid to the Secretary and the Company as
determined by the Secretary.
(d) Any withdrawal from the Title XI Reserve Fund pursuant to this
Section 4 shall not effect a discharge of or diminish any obligations of the
Company under the Security Agreement, Mortgage or any other agreement as the
case may be except to the extent that the
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amount withdrawn is applied to payments required to be made by the Company under
the Security Agreement, Mortgage or any other agreement.
Section 5. Eligible Investments; Form of Deposits.
(a) Moneys held in the Title XI Reserve Fund shall, if so directed by
a Request of the Company delivered to the Depository (with a copy to the
Secretary), be invested by the Depository in the following Eligible Investments:
(1) time deposits, negotiable certificates of deposit, or similar
instruments of deposit with a bank or trust company organized as a
corporation under the laws of the United States or any State thereof,
or of the District of Columbia, subject to supervision or examination
by Federal or State authority or authority of the District of Columbia,
and having a combined capital and surplus of at least $3,000,000;
provided that, the aggregate of all such time deposits and certificates
of deposit with any one bank or trust company shall not exceed 10% of
the combined capital and surplus of such bank or trust company;
(2) short term commercial paper having either of the two highest
ratings for short term commercial paper assigned by any two nationally
recognized organizations regularly engaged in rating the investment
quality of such commercial paper; and
(3) securities (designated by the Company in such Request) which
at the date of such investment are:
(A) direct obligations of, or obligations (other than the
Obligations or Obligations related to the Company) fully guaranteed or insured
by, the United States or any agency of the United States or with the Secretary's
prior written consent and subject to such conditions imposed by him, obligations
or securities fully insured by an instrumentality of the United States;
(B) bonds, not in default as to principal or interest of any
county, municipality or state of the United States and having either of the two
highest ratings for bonds assigned by any two nationally recognized
organizations regularly engaged in rating the investment quality of such bonds;
(C) bonds, not in default as to principal or interest, of
corporations organized and existing under the laws of the United States or of
the District of Columbia or of any state of the United States and having one of
the three highest ratings for bonds assigned by any two nationally recognized
organizations regularly engaged in rating the investment quality of such bonds;
provided that, no investment under this subsection (5)(a)(3)(C) shall be made in
any obligations of the Company or a Related Party;
(D) capital stock, but limited at the time of acquisition to any
amounts in the Title XI Reserve Fund in excess of the principal amount of
Obligations to be redeemed pursuant to the mandatory sinking fund provisions of
the Indenture, during the next succeeding 12 months
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of (i) corporations organized and existing under the laws of the United States
or the District of Columbia or of any state of the United States if such stock
is currently fully listed and registered upon an exchange registered with the
Securities and Exchange Commission as a national securities exchange and
permitted for investment by a savings bank under the laws of the State of New
York without regard to the provisions therein limiting such investments to a
percentage of the assets or surplus of such savings bank, (ii) banks either
regulated by the Comptroller of the Currency of the United States or subject to
the Banking Law of the State of New York, or (iii) insurance companies licensed
to do business in such state; provided that, no investment under this subsection
shall be made in stock of the Company or a Related Party; provided further that,
any request under this subsection shall be accompanied by an opinion of counsel
satisfactory to the Secretary as to the qualification of such securities under
this clause and provided further, that the Company shall cause to be sold,
within 60 days, or at any time if the Secretary so directs the Company in
writing, any securities which cease to qualify under this subsection.
(b) In any case where the Company is required to deposit or redeposit
sums into the Title XI Reserve Fund, the Company shall make the required deposit
in cash or, in lieu thereof, with the Secretary's prior written approval, may
deposit into the Title XI Reserve Fund, negotiable certificates of deposit,
short term commercial paper or securities which are (1) Eligible Investments (2)
owned by the Company and (3) of an equivalent current market value (based upon
the last sales price thereof on the Business Day immediately preceding such
deposit or, if there shall have been no sale thereof on such day, the average of
the last known bid and asked prices). With the Secretary's prior written
approval, the Company may exchange Eligible Investments in the Title XI Reserve
Fund at current market value (determined as above provided) for an equivalent
amount of cash.
(c) Cash held in the Title XI Reserve Fund will be held by the
Depository pursuant to the Depository Agreement.
Section 6. Company's Rights with Respect to Securities Held in the
Title XI Reserve Fund. Unless there is an existing Default under the Security
Agreement, the Company shall have:
(a) the right to vote (or direct the vote of) securities held in the
Title XI Reserve Fund as to (1) the sale of all or any part of the assets of the
issuer or obligor thereof, (2) the increase or reduction of the capital of such
issuer or obligor, (3) the liquidation, dissolution, merger or consolidation of
such issuer or obligor, or (4) any purpose which would not then impair the lien
of, or the security interest granted to the Secretary; and
(b) the right to exercise (or direct the exercise of) any and all
rights of ownership of such securities, including the right to consent or object
to the extension, modification or renewal of any thereof, the right to consent
or object to any plan or reorganization, or readjustment, and the right to
exercise any right, privilege or option pertaining thereto.
Section 7. Annual Statement of Company with Respect to the Title XI
Reserve Fund. Within 105 days after the close of each fiscal year of the Company
at the end of which there are
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funds in the Title XI Reserve Fund (and at such other times as the Secretary may
request in writing), the Company shall submit to the Secretary (with a copy to
the Depository) (a) an opinion of counsel satisfactory to the Secretary as to
the qualification, under Section 5(a)(3)(D), of securities acquired pursuant to
that subparagraph and then held in the Title XI Reserve Fund and (b) a list of
the Eligible Investments held in the Title XI Reserve Fund at the close of said
fiscal year (or at the time of the Secretary's request as aforesaid).
Section 8. Financial Requirement of the Company.
(a) Primary Covenants. The Company shall not without the Secretary's
prior written consent:
Except as hereinafter provided, make any distribution of earnings,
except as may be permitted by (A) or (B) below:
(A) From retained earnings in an amount specified in subsection
(C) below, provided that, in the fiscal year in which the distribution
of earnings is made there is no operating loss to the date of such
payment of such distribution of earnings, and (i) there was no
operating loss in the immediately preceding three fiscal years, or (ii)
there was a one-year operating loss during the immediately preceding
three fiscal years, but (a) such loss was not in the immediately
preceding fiscal year, and (b) there was positive net income for the
three year period;
(B) If distributions of earnings may not be made under (A) above,
a distribution can be made in an amount equal to the total operating
net income for the immediately preceding three fiscal year period,
provided that, (i) there were no two successive years of operating
losses, (ii) in the fiscal year in which such distribution is made,
there is no operating loss to the date of such distribution, and (iii)
the distribution or earnings made would not exceed an amount specified
in Section 8(a)(1)(C) below;
(C) Distributions of earnings may be made from earnings of prior
years in an aggregate amount equal to (i) 40 percent of the Company's
total net income after tax for each of the prior years, less any
distributions that were made in such years; or (ii) the aggregate of
the Company's total net income after tax for such prior years, provided
that, after making such distribution, the Company's Long Term Debt does
not exceed its Net Worth. In computing net income for the purposes of
this Section, extraordinary gains, such as gains from the sale of
assets, shall be excluded.
(1) Enter into any service, management or operating agreement for the
operation of the Vessel (excluding husbanding type agreements), or appoint or
designate a managing or operating agent for the operation of the Vessel
(excluding husbanding agents) unless approved by the Secretary;
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(2)(A) Sell, mortgage, transfer, or demise charter the Vessel or any
assets to any non-Related Party except as permitted in subsection 8(a)(6) below,
or (B) sell, mortgage, transfer, or demise charger the Vessel or any assets to a
Related Party, unless such transaction is (i) at a fair market value as
determined by an independent appraiser acceptable to the Secretary, and (ii) a
total cash transaction or, in the case of demise charter, the charter payments
are cash payments.
(3) Enter into any agreement for both (A) sale and (B) leaseback of the
same assets so sold unless the proceeds from such sale are at least equal to the
fair market value of the property sold;
(4) Guarantee, or otherwise become liable for the obligations of any
Person, except in respect of any undertakings as to the fees and expenses of the
Indenture Trustee, except endorsement for deposit of checks and other negotiable
instruments acquired in the ordinary course of business and except as otherwise
permitted in Section 8(b);
(5) Directly or indirectly embark on any new enterprise or business
activity not directly connected with the business of shipping or other activity
in which the Company is actively engaged;
(6) Enter into any merger or consolidation or convey, sell, demise
charter, or otherwise transfer, or dispose of any portion of its properties or
assets (any and all of which acts are encompassed within the words "sale" or
"sold" as used herein), provided that, the Company shall not be deemed to have
sold such properties or assets if (A) the Net Book Value (defined as the
original book value of an asset less depreciation calculated on a straight line
basis over its useful life) of the aggregate of all the assets sold by the
Company during any period of 12 consecutive calendar months does not exceed 10%
of the total Net Book Value of all the Company's assets (the assets which are
the basis for the calculation of the 10% of the Net Book Value are those
indicated on the most recent audited annual financial statement required to be
submitted pursuant to Section 9 hereof prior to the date of the sale); (b) the
Company retains the proceeds of the sale of assets for use in accordance with
the Company's regular business activities; and (C) the sale is not otherwise
prohibited by subsection 8(a)(3) above. Notwithstanding any other provision of
this subsection, the Company may not consummate such sale without the
Secretary's prior written consent if the Company has not, prior to the time of
such sale, submitted to the Secretary the financial statement in clause (A) of
this subsection, and any attempt to consummate a sale absent such approval shall
be null and void ab initio.
(b) Supplemental Covenants. Commencing with the First Calendar Year of
Vessel Operations and continuing thereafter unless, after giving effect to such
transaction or transactions during any fiscal year: (i) the Company's
debt-to-equity ratio does not exceed 2:1; (ii) upon completion of construction
of the Vessel and the First Calendar Year of Vessel Operation, the Company's
Minimum Cash Flow Ratio is not less than 1.0 to 1.0; and (iii) the Company has a
positive cash balance at all times, the Company shall not, without the
Secretary's prior written consent during any fiscal year of the Company after
completion of construction of the Vessel:
(1) Withdraw any capital;
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(2) Redeem any share capital or convert any of the same into debt;
(3) Pay any dividend (except dividends payable in capital stock of the
Company);
(4) Make any loan or advance (except advances to cover current expenses
of the Company), either directly or indirectly, to any stockholder, director,
officer, or employee of the Company, or to any Related Party;
(5) Make any investments in the securities of any Related Party;
(6) Prepay in whole or in part any indebtedness to any stockholder,
director, officer or employee of the Company, or to any Related Party;
(7) Increase any direct employee compensation (as hereinafter defined)
paid to any employee in excess of $100,000 per annum; nor increase any direct
employee compensation which is already in excess of $100,000 per annum; nor
initially employ or re-employ any person at a direct employee compensation rate
in excess of $100,000 per annum; provided, however, that beginning with January
1, 2000, the $100,000 limit may be increased annually based on the previous
year's closing CPI-U (Consumer Price Index for All Urban Consumers published by
the Bureau of Labor Statistics). For the purpose of this section the term
"direct employee compensation" is the total amount of any wage, salary, bonus,
commission, or other form of direct payment to any employee from all companies
with guarantees under Title XI of the Act as reported to the Internal Revenue
Service for any fiscal year;
(8) Acquire any fixed assets other than those required for the
maintenance of the Company's existing assets, including the normal maintenance
and operation of any vessel or vessels owned or chartered by the Company;
(9) Either enter into or become liable (directly or indirectly) under
charters and leases (having a term of six months or more) for the payment of
charter hire and rent on all such charters and leases which have annual payments
aggregating in excess of $3,000,000;
(10) Pay any indebtedness subordinated to the Obligations or to any
other Title XI obligations;
(11) Create, assume, incur, or in any manner become liable for any
indebtedness, except current liabilities, or short term loans, incurred or
assumed in the ordinary course of business as such business presently exists;
(12) Make any investment, whether by acquisition of stock or
indebtedness, or by loan, advance, transfer of property, capital contribution,
guarantee of indebtedness or otherwise, in any Person, other than obligations of
the United States, bank deposits or investments in securities of the character
permitted for moneys in the Title XI Reserve Fund; or
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(13) Create, assume, permit or suffer to exist or continue any
mortgage, lien, charge or encumbrance upon, or pledge of, or subject to the
prior payment of any indebtedness, any of its property or assets, real or
personal, tangible or intangible, whether now owned or hereafter acquired, or
own or acquire, or agree to acquire, title to any property of any kind subject
to or upon a chattel mortgage or conditional sales agreement or other title
retention agreement, except (i) loans, mortgages and indebtedness guaranteed by
the Secretary under Title XI of the Act or related to the construction of a
vessel approved for Title XI by the Secretary and (ii) liens incurred in the
ordinary course of business as such business presently exists.
Notwithstanding the requirements set forth in Section 8(b)(i) above, so long as
the Company is not in Default under the Security Agreement and Guarantor's
guarantee is in full force and effect, the Company will not be required to make
any Title XI Reserve Fund Deposits during the First Calendar Year of Vessel
Operation and the Second Calendar Year of Vessel Operation regardless of its
debt-to-equity ratio and, in the Third Calendar Year of Vessel Operation and the
Fourth Year of Vessel Operation unless its debt-to-equity ratio is in excess of
4.0 to 1.0.
Notwithstanding the requirements in Section 8(b) above, so long as the
Shipowner is not in Default under the Security Agreement and the Guarantor's
guarantee is in full force and effect, the Shipowner may:
(1) Make advances, loans or other distributions to the Sister Shipowner
if the Sister Shipowner issues a guarantee of the Company's debt that is in form
and substance acceptable to the Secretary and said guarantee is in full force
and effect and the Sister Shipowner has not defaulted on its Security Agreement;
(2) Make reimbursement or payments to the Guarantor and/ or Ocean
Development Co. with respect to administrative, operational and/or management
expenses incurred with respect to the Vessel;
(3) Make a distribution in form and substance satisfactory to the
Secretary to the Guarantor to be used for equity on an option vessel as provided
for in the shipbuilding contract relating to the Vessel, and the vessel being
constructed by the Sister Shipowner provided the Company has met its cash flow
test for the most recent reporting period, has a debt-to-equity ratio not in
excess of 4.0 to 1.0 until the sixth calendar year of vessel operation, and is
not in default on its Security Agreement; and
(4) Make advances to the Guarantor in accordance with the Guarantor's
cash management program provided such program has been approved by the Secretary
and any such advances are evidenced by a receivable from the Guarantor, which
receivable is due and payable to the Company at any time the Company does not
have adequate funds to meet its current obligations including but limited to
current obligations with respect to the Title XI debt.
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Section 9.
(a) Annual Financial Statements. The Company shall furnish to the
Secretary, in duplicate, (1) within 105 days after the end of each fiscal year
of the Company commencing with the first fiscal year ending after the date of
the Security Agreement, the Company's Audited Financial Statements including
balance sheet and income statement for such fiscal year along with a completed
M.A. Form 172 or such other form approved by the Secretary, and (2) within 90
days after the expiration of each semi-annual period of each fiscal year
commencing with the first such semi-annual period ending after the date of the
Security Agreement, a completed M.A. Form 172 or such other form approved by the
Secretary for such semi-annual period along with an Officer's Certificate
certifying its accuracy.
(b) Annual No Default Certificates. Within 105 days after the end of
each fiscal year of the Company, the Company shall furnish to the Secretary, an
Officer's Certificate dated as of the close of such fiscal year stating whether
or not, the Company is in default in the performance of or in default in the
compliance with any covenant, agreement or condition contained herein or in the
Mortgage, Security Agreement or charter relating to the Vessel listed in
Attachment A hereto, and if so, specifying each such default and stating the
nature thereof.
Section 10. Qualifying Financial Requirements of the Company.
The Company shall furnish an Officer's Certificate, dated the date
hereof, certifying that the Company has equity at least equal to the difference
between the Vessel's capitalizable cost and the Vessel's Title XI guaranteed
amount, that any other costs related to the Vessel are funded in the manner
established by the Funding Agreement, and that the Guaranty Agreement is in full
force and effect.
Section 11. Notices. Except as otherwise provided in this Agreement,
notices, requests, directions, instructions, waivers, approvals or other
communication may be made or delivered in person or by registered or certified
mail, postage prepaid, addressed to the party as provided below, or to such
other address as such party may hereafter specify in a written notice to the
other parties named herein, and all notices or other communications shall be in
writing so addressed and shall be effective upon receipt by the addressee
thereof:
The Secretary as: SECRETARY OF TRANSPORTATION
c/o Maritime Administrator
Maritime Administration
400 Seventh Street, S.W.
Washington, D.C. 20590
The Title XI Reserve
Fund Depository as: The Bank of New York
101 Barclay Street
New York, NY 10286
Attention: Corporate Trust Administration
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The Company as: Cape May Light, L.L.C.
Robin Street Wharf
1380 Port of New Orleans Place
New Orleans, Louisiana 70130-1890
Section 12. Amendments and Supplements. No agreement shall be effective
to amend, supplement, or discharge in whole or in part this Financial Agreement
unless such agreement is in writing signed by the parties hereto. Any
amendments, additions, deletions, substitutions or other changes no made in
accordance with this provision shall be invalid and of no effect.
Section 13. Counterparts. This Financial Agreement may be executed in
any number of counterparts. All such counterparts shall be deemed to be
originals, and shall together constitute but one and the same instrument.
Section 14. Governing Law. This Financial Agreement and the rights and
obligations of the parties hereto shall be governed by and construed in
accordance with U.S. maritime laws, to the extent applicable, and otherwise in
accordance with the laws of the State of New York.
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IN WITNESS WHEREOF, this Financial Agreement has been executed by the
parties hereto as of the day and year first above written.
UNITED STATES OF AMERICA
SECRETARY OF TRANSPORTATION
BY: MARITIME ADMINISTRATOR
/ s / Joel C. Richard
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Secretary
ATTEST:
/ s / Sarah J. Washington
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Assistant Secretary
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Shipowner: Cape May Light, L.L.C.
By: DELTA QUEEN COASTAL VOYAGES, L.L.C.,
its Managing Member
By: THE DELTA QUEEN STEAMBOAT CO.,
its Managing Member
By: / S / JORDAN B. ALLEN
------------------------------
Its Executive Vice President
ATTEST:
By / s / Pam Stringer
----------------------------
Assistant Secretary
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ATTACHMENT A
TITLE XI RESERVE FUND AND FINANCIAL AGREEMENT
(Contract No. MA-13629)
1. This Financial Agreement shall apply to the Cape May Light.
2. The Company's aggregate original equity investment for use in
Section 2 for the Cape May Light is $6,349,278.