continue to be pledged under the mortgage of these bonds, being assumed by West Penn Electric Company.

• The demand notes payable represent an advance of $2,200,000 made to the company on its non-interest bearing promissory notes by the American Water Works and Electric Company, Inc. (former parent company which has been dissolved and liquidated) which notes were deposited by such former parent in escrow as security for the payment of the amounts of premium and interest, if any, and expenses, which may finally be determined to be payable as a result of the retirement of that former parent company's preferred stock.

The aggregate principal amount of new S. F. collateral trust bonds proposed to be sold is to be $31,000,000; $745,000 of which is included under current liabilities as long term debt due within one (1) year because of the annual sinking fund requirements of the proposed issue. These bonds were priced at 100 for the purposes of this balance sheet only.

• Includes special provision of $10,819,926 for the purpose of ultimately abandoning West Penn Railways Company's street railway operations.

This includes 856,895 new shares of common stock proposed to be issued, exchanged and sold, priced at $22 per share, for purposes of this balance sheet only.

APPENDIX C

THE WEST PENN ELECTRIC COMPANY

Statement of income for twelve months ended May 31, 1949, and pro forma, giving effect as at the beginning of such period to the consummation of the 11 (e) plan and a 75% subsidiary dividend policy and the refinancing of West Penn Electric Company's present securities

Interest on first mortgage 5% gold bonds of West Penn Traction Com

APPENDIX D

THE WEST PENN ELECTRIC COMPANY

AND ITS SUBSIDIARY COMPANIES

Consolidated statement of income for the twelve months ended May 31, 1949, and pro forma, giving effect as at the beginning of such period to the consummation of the 11 (e) plan and the refinancing of West Penn Electric Company's present securities

IN THE MATTER OF

NEW ENGLAND GAS AND ELECTRIC ASSOCIATION

File No. 70-2111. Promulgated September 15, 1949.

(Public Utility Holding Company Act of 1935-Sections 6 and 7)

ISSUANCE AND SALE OF SECURITIES.

Application-declaration of registered holding company and several of its utility subsidiaries regarding issuance and sale by the holding company of additional shares of its common stock to its stockholders under a preemptive rights offering, and the issuance and sale by the several subsidiaries of their promissory notes to a commercial bank, granted and permitted to become effective.

APPEARANCES:

William A. Hill, of Boston, Massachusetts, for New England Gas and Electric Association.

Harold C. Lohren, for the Division of Public Utilities of the Commission.

FINDINGS AND OPINION OF THE COMMISSION

New England Gas and Electric Association ("NEGEA”), a registered holding company, and its public utility subsidiaries, Cambridge Electric Light Company ("Cambridge Electric"), Cambridge Gas Light Company ("Cambridge Gas"), Cape & Vineyard Electric Company ("Cape"), Dedham and Hyde Park Gas Company ("Dedham"), New Bedford Gas and Edison Light Company ("New Bedford"), Plymouth County Electric Company ("Plymouth"), and Worcester Gas Light Company ("Worcester"), have filed a joint application-declaration, with amendments thereto, pursuant to Sections 6 (a), 6 (b) and 7 of the Public Utility Holding Company Act of 1935, regarding the issuance and sale of additional common stock by NEGEA to its stockholders and the issuance and sale by the respective subsidiaries of their promissory notes to a commercial bank.

After appropriate notice, a public hearing was held. The

30 S. E. C.-35-9340

Commission having considered the record, makes the following findings:

DESCRIPTION OF COMPANIES.

NEGEA is an association, commonly described as a Massachusetts trust, organized in accordance with the laws of Massachusetts. It is a holding company owning the common stock of ten public utility companies which operate in Massachusetts, one which operates in Maine and one which operates in New Hampshire. In addition, it owns all the common stock of a steam heating company and a service company.

The applicant subsidiaries herein are all corporations organized under the laws of Massachusetts. Cambridge Electric and Cambridge Gas are engaged in the production, distribution and sale of electricity and manufactured gas, respectively, in and about Cambridge, Massachusetts. Cape is engaged in the purchase, distribution and sale of electricity on Cape Cod and on the island of Martha's Vineyard in Massachusetts. Dedham is engaged in the production, distribution and sale of manufactured gas in and about Dedham and Hyde Park, suburbs of Boston, Massachusetts. New Bedford is engaged in the production, distribution and sale of electricity and manufactured gas in and about the City of New Bedford, Massachusetts. Plymouth is engaged in the purchase, transmission, distribution and sale of electricity in and about Plymouth, Massachusetts. Worcester is engaged in the production, distribution and sale of manufactured gas in the cities of Worcester and Framingham, Massachusetts, and surrounding territory.

PROPOSED TRANSACTIONS.

The transactions proposed by applicants-declarants are as follows:

NEGEA proposes to offer to the holders of its outstanding 1,246,011 shares of common stock the right to subscribe for 124,601 shares of additional common stock at a price of $11.25 per share, on the basis of one share of the additional common stock for each ten shares of common stock held. Persons exercising the right to subscribe will also be given the privilege to subscribe for such of the additional shares as are not subscribed for through the exercise of the rights. Such privilege of over subscription will entitle the shareholders to subscribe for one share of additional stock for each share owned and will be subject