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Dard as collateral for Nisona’s nonrecourse note. The PPM
further states that Dard purchased the EMS for $337,500 in 1980
from Consumer Energy Funding, Inc. (CEF), an unrelated party.
According to the PPM, CEF was organized in 1980 and had limited
experience in the field of energy management and in the care or
supervision of systems similar to the one being acquired by Sav-
Fuel.
The PPM states that CEF entered into a user agreement with
Gould dated September 30, 1980. CEF was to operate and service
the energy management equipment to be installed at the Gould
manufacturing plant. Under the user agreement between CEF and
Gould, Gould was to pay CEF 50 percent of the gross energy
savings realized from the use of the energy management equipment.
Sav-Fuel was to enter into a management agreement with CEF
sometime around November 1980. Pursuant to the agreement, CEF
was to install and manage the EMS in exchange for certain
management fees. CEF was to retain 15 percent of the amount
received from Gould and was to remit the remaining 85 percent to
Sav-Fuel. Taking into account Sav-Fuel’s obligation to Nisona,
Sav-Fuel was to be entitled to 8.5 percent of any savings
generated by the EMS. It is unknown whether the EMS was
installed at Gould’s manufacturing plant and whether it ever
produced substantial energy savings.
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Last modified: May 25, 2011