<PAGE>
FORM U-3A-2
FILE NO. 69-143
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
STATEMENT BY HOLDING COMPANY CLAIMING
EXEMPTION UNDER U-3A-2 RULE FROM THE
PROVISIONS OF THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935
EASTERN GAS & WATER INVESTMENT COMPANY
OCEAN CITY, MARYLAND
<PAGE>
EASTERN GAS & WATER INVESTMENT COMPANY hereby files with the
Securities and Exchange Commission, pursuant to Rule 2, its
statement claiming exemption as a holding company from the
provisions of the Public Utility Holding Company Act of 1935. In
support of such claim for exemption the following information is
submitted:
1. The name of the claimant is Eastern Gas & Water
Investment Company, a corporation organized in the State
of Delaware, and located at Ocean City, Maryland. It is
a holding company, having totally owned subsidiaries as
follows:
(a) The Eastern Shore Gas Company (Maryland), a
corporation organized in the State of Maryland,
whose principal office is located at Ocean City,
Maryland. It is engaged in the retail, utility
distribution of propane to its customers.
(b) Eastern Shore Propane, a corporation organized in
the State of Delaware, whose principal office is
located at Ocean City, Maryland. It is engaged in
the retail sale of bottled propane to its
customers.
(c) The Chestertown Shorgas Company, a corporation
organized in the State of Maryland, whose principal
office was located at Chestertown, Maryland. It was
formerly engaged in the retail, utility
distribution of propane air gas to its customers.
This company is currently a shell corporation with
no business activity.
(d) Eastern Management Services, Inc., a Delaware
Corporation, whose principal office was located in
King of Prussia, Pennsylvania. It was formerly
engaged in management services to its affiliates.
This company is currently a shell corporation with
no business activity.
<PAGE>
(e) West Virginia Oil Gathering Corporation, a
corporation organized in the State of West
Virginia, whose principal office is located in
Eureka, West Virginia. It is engaged in truck and
pipeline operations.
2. The Eastern Shore Gas Company (Maryland) has plants in
Snow Hill, Berlin, Ocean City, West Ocean City and
Pocomoke City, Maryland, at which propane gas is stored
and then distributed and sold to its customers.
3. The following information is for the last calendar year
(i.e., December 31, 1998) with respect to claimant and
each of its subsidiary public utility companies:
(a) During the calendar year 1998, the Eastern Shore
Gas Company (Maryland) sold 542,265 M.C.F.
($2,572,500) to its retail customers in the state
of Maryland.
(b) None of the above mentioned subsidiaries
distributes any natural or manufactured gas at
retail outside of the state in which each company
is organized.
(c) None of the above mentioned subsidiaries sells
natural or manufactured gas at wholesale outside
the state in which each company is organized or at
the state line.
(d) None of the above mentioned subsidiaries purchases
natural or manufactured gas outside the state in
which each company is organized or at the state
line.
A consolidating statement of income and surplus of the
claimant and its subsidiary companies for the last
calendar year (i.e., calendar year ending December 31,
1998) together with a consolidating balance sheet of
claimant and its subsidiary companies as of the close of
such calendar year is attached hereto as Exhibit A.
4. a. through e. -- none of the subsidiaries qualify as an
EWG or as a foreign utility.
Exhibit C -- Not Applicable.
<PAGE>
The above named claimant has caused this statement to be duly
executed on its behalf by its authorized officers on this 10th
day of February 1998.
EASTERN GAS & WATER INVESTMENT COMPANY
BY: Nicolette M. Martinelli
Treasurer
ATTEST:
Carolyn A. Park
Secretary
Name, title and address of officer to whom notices and
correspondence concerning this statement should be addressed:
Nicolette M. Martinelli Treasurer
5 Radnor Corporate Center, Suite 400
Radnor, PA 19087
<PAGE>
EASTERN GAS & WATER INVESTMENT CO
FILE NO. 69-143
CONSOLIDATING INCOME STATEMENT
FOR THE YEAR ENDING DECEMBER 31, 1998
<TABLE>
<CAPTION>
WEST
EASTERN EASTERN VIRGINIA
SHORE SHORE OIL
GAS PROPANE GATHERING EGWIC CONSOLIDATED
----------- ----------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
REVENUE
GAS SALES 2,572,500 315,884 0 2,888,385
SERVICE INCOME 337,038 0 0 337,038
OTHER REVENUE 52,726 (4,049) 215,284 263,961
OIL GATHERING 0 0 2,156,234 2,156,234
----------- ----------- -------------- ------------ -------------
2,962,265 311,836 2,371,517 0 5,645,618
EXPENSES
PRODUCTION EXPENSE 53,411 40,351 0 0 93,762
DISTRIBUTION EXPENSE 1,914,129 150,858 0 1,785 2,066,772
OPERATING EXENSES 0 0 1,796,338 0 1,796,338
DEPRECIATION 380,846 72,644 228,900 39,000 721,390
GENERAL & ADMINISTRATIVE 280,317 40,992 126,212 240 447,761
----------- ----------- -------------- ------------ -------------
2,628,703 304,846 2,151,450 41,025 5,126,024
EARNINGS BEFORE TAXES 333,562 6,990 220,067 (41,025) 519,594
INTEREST EXPENSE 0 0 154,472 154,472
STATE INCOME TAX 0 489 5,904 (5,113) 1,280
FEDERAL INCOME TAX 103,307 714 13,002 (14,564) 102,459
----------- ----------- -------------- ------------ -------------
NET INCOME 230,255 5,786 46,689 (21,348) 261,383
----------- ----------- -------------- ------------ -------------
----------- ----------- -------------- ------------ -------------
</TABLE>
<PAGE>
EASTERN GAS & WATER INVESTMENT COMPANY
FILE NO. 69-143
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
WEST
EASTER EASTERN VIRGINIA
SHORE SHORE OIL EMS &
GAS PROPANE GATHERING EGWIC CHESTERTOWN ELIMININATIONS CONSOLIDATED
------------ ------------- ------------- ----------- -------------- -------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
PROPERTY, PLANT AND EQUIP 8,293,072 1,004,619 1,614,910 215,000 0 11,127,601
ACCUMULATED DEPRECIATION (2,716,448) (449,536) (222,905) (3,388,889)
AQUISITION ADJUSTMENT 230,000 1,570,959 1,800,959
AMORTIZATION AQUISITION ADJ (221,000) (547,305) (768,305)
NET PROP, PLANT & EQUIP 5,576,624 564,083 1,392,005 1,238,654 0 0 8,771,366
CURRENT ASSETS:
CASH AND TEMP. INVESTMENTS (1,319,853) (2,536,260) 1,484,394 (124,830) 2 (2,496,547)
ACCOUNTS RECEIVABLE (2,707,957) 3,003,182 750,000 1,045,225
INVENTORIES 0 0
UNBILLED REVENUE 206,669 206,669
OTHER CURRENT ASSETS 7,823 175 7,998
------------ ------------- ------------- ----------- -------------- -------------- ------------
TOTAL CURRENT ASSETS (3,821,141) 466,922 2,242,217 (124,655) 2 0 (1,236,655)
DEFERRED CHARGES 121,961 121,961
AMORTIZATION OF INTANGIBLES 2,775 2,775
INVESTMENTS 810,967 (810,867) 100
------------ ------------- ------------- ----------- -------------- -------------- ------------
TOTAL ASSETS 1,755,483 1,031,005 3,758,959 1,924,965 2 (810,867) 7,659,547
------------ ------------- ------------- ----------- -------------- -------------- ------------
------------ ------------- ------------- ----------- -------------- -------------- ------------
</TABLE>
<PAGE>
EASTERN GAS & WATER INVESTMENT COMPANY
FILE NO. 69-143
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
EASTERN EASTERN W. VIRGINIA
SHORE SHORE OIL EMS &
GAS PROPANE GATHERING EGWIC CHESTERTOWN ELIMININATIONS CONSOLIDATED
----------- ------------ ------------- ------------ ------------- -------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
COMMON STOCK 7,500 200 100 8,744 2 7,802 8,744
PREFERRED STOCK 2,799,000 2,799,000
TREASURY STOCK (42,376) (42,376)
APIC 513,438 513,338 100
RETAINED EARNINGS 1,492,434 504,093 412,496 (1,084,265) 289,727 1,035,031
---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL STOCKHOLDERS' EQUITY 1,499,934 1,017,731 412,596 1,681,103 2 810,867 3,800,499
LONG TERM DEBT 0 0 2,830,013 0 2,830,013
CURRENT LIABILITIES:
CURRENT PORTION LONG TERM DEBT 0 0 359,996 0 359,996
ACCOUNTS PAYABLE 171,807 2,239 26,007 5,448 205,501
GAS ACCOUNT 87,624 (0) 87,624
OTHER ACCRUED LIABILTIES 29,867 25,463 122,559 71,724 249,613
TAXES ACCRUED: 0
PSC GROSS RECEIPTS TAX (15,289) (15,289)
FEDERAL INCOME TAX (18,813) (24,437) 13,378 (121,011) (150,883)
OTHER (19,311) (6,576) (5,589) (5,113) (36,588)
---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL CURRENT LIABILITIES 235,885 (3,311) 516,351 (48,951) 0 0 699,974
DEFERRED INCOME TAXES 19,664 16,584 292,813 329,061
---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL CAPITALIZATION & LIAB 1,755,483 1,031,005 3,758,959 1,924,965 2 810,867 7,659,547
---------- ---------- ---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ---------- ---------- ----------
</TABLE>
