Pennichuck subsidiary arranges $2.5M SRF financing

Sept. 20, 2007
Pennichuck Corporation today announced that its Pittsfield Aqueduct Company subsidiary has arranged a $2.5 million financing pursuant to the New Hampshire State Drinking Water Revolving Loan Fund (SRF). Proceeds will be utilized by Pittsfield over the next two years to fund new water utility infrastructure projects within its recently acquired systems serving Barnstead and North Conway, New Hampshire. Such projects include distribution systems, zone booster stations, water treatment...

MERRIMACK, NH, Sept. 19, 2007 -- Pennichuck Corporation today announced that its Pittsfield Aqueduct Company subsidiary ("Pittsfield") has arranged a $2.5 million financing pursuant to the New Hampshire State Drinking Water Revolving Loan Fund (the "SRF"). Proceeds will be utilized by Pittsfield over the next two years to fund new water utility infrastructure projects within its recently acquired systems serving Barnstead and North Conway, New Hampshire. Such projects include distribution systems, zone booster stations, water treatment facilities, water storage facilities, and well supplies.

The State of New Hampshire established the SRF, which is administered by its Department of Environmental Services, for financing water pollution control and drinking water improvement projects within the State. Inclusive of this transaction, Pennichuck has arranged seven SRF loans aggregating about $7 million among its Pennichuck Water, Pennichuck East, and Pittsfield regulated water utility subsidiaries.

SRF loans represent a low cost source of debt financing for water utility infrastructure projects. Borrowings under SRF loans accrue interest at the rate of 1% during construction. Once the project is placed into service, the SRF loan converts to a twenty-year (monthly amortizing) repayment period at a fixed rate of interest equal to 80% of the rate for high quality municipal bonds. The benefits of low cost SRF loans are completely passed along to customers.

Pennichuck Corporation is a holding company involved principally in the supply and distribution of potable water in southern and central New Hampshire through its three regulated water utilities. Its non-regulated, water-related activities include operations and maintenance contracts with municipalities and private entities in New Hampshire and Massachusetts. The Company's real estate operations are involved in the ownership, management and development of real estate in the greater Nashua, New Hampshire area.

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