September 7, 2018

Ms. Michelle Monsegur

Assistant Town Administrator
Town of Hingham
210 Central Street
Hingham, MA 02043

Re: Non-Binding Estimate for Hingham Water Facility O&M – Revision to include meter reading
and billing.

Dear Ms. Monsegur:

I am following up regarding your request for a non-binding estimate for the operation and
maintenance costs of the Aquarion Water Facilities, located in Hingham MA. It is understood
that the Town is considering purchase of the Aquarion Facilities and to do so will need to
understand operations and maintenance costs associated with the operation of the facilities.

The methodology used for estimating costs was derived by comparing the Aquarion Facilities
size and scope of work with comparable Veolia projects currently being operated in the New
England region. A matrix was developed for the following costs: labor, chemicals, heat and
repair and maintenance. This matrix identified High, Low and Average costs per MG for each
Veolia facility. By comparing the scope of work and water sources for the various projects,
Veolia was able to best estimate costs per MG for each of the above cost categories. Electricity
was calculated from information obtained from the Town’s recent Request For Proposal. These
costs were then summed and profit and overhead charges applied to arrive at a total estimated
annual fee. In addition, estimated costs are inclusive of insurances and bonds and other
administrative costs.

Veolia has estimated annual operation and maintenance costs for the water system to be
$2,098,000. We have also estimated the cost for meter reading and billing at $1,072,571.00
this includes rental of office space and purchasing of the billing platform software (estimated at
$400,000) amortized over a 10 year contract term. The total annual fee is estimated at
$3,170,571.

Veolia North America

15 Elkins Street
Boston, MA 02127
508-889-1242
Please keep in mind that the cost outlined in this letter is an estimate based upon the request
by the Town of Hingham. Nothing in this letter shall be interpreted as (i) being a binding offer to
perform due diligence, negotiate, or consummate a transaction; or (ii) requiring either party to
enter into any agreement or arrangement with the other party with respect to a transaction; or
(iii) requiring the Team or any of its affiliates to enter into any form of collaboration. This
document is not intended to, and does not; contain all matters upon which agreement would
have to be reached with respect to a transaction in order for us to make a binding agreement or
commitment. Any future binding agreement or commitment with respect to a transaction will
be subject to the completion of our due diligence investigation, the negotiation and execution
of a definitive agreement containing mutually acceptable terms and conditions, and the receipt
of all necessary internal authorizations, which we may decline to provide in our sole and
absolute discretion.

If you have any questions regarding this letter, or Veolia’s service offerings in general, please do
not hesitate to contact me at 508-889-1242.

Respectfully,
Digitally signed by Darlene Domingos

Darlene Domingos DN: cn=Darlene Domingos, o=Veolia Water, ou=Vice President

Operations, email=darlene.domingos@veolia.com, c=US
Date: 2018.09.07 15:07:11 -04'00'

Darlene Domingos,
VP Operations, Veolia East

Veolia North America

15 Elkins St.
Boston, MA 02127
508-889-1242