i

TARIFF

TABLE OF CONTENTS

Page Sheet

RULES AND REGULATIONS

I. Technical Words, Phrases, Terms and Abbreviations 1 1

1.01 Abbreviations 1 1

1.02 Billing Period 1 1

1.03 British Thermal Unit 1 1

1.04 Cubic Foot of Gas 1 1

1.05 Customer 2 1

1.06 2 1

1.07 Day, Daily or Delivery Gas Day 2 1

1.08 District 2 1

1.09 Florida Agriculture 2 1

1.10 Gas 2 1

1.11 Gas Service 2 1

1.12 Gas Service Facilities 2 1

1.13 Heat Only Customer 2 1

1.14 High Pressure 2 1

1.15 Main 2 1

1.16 Meter 2 1

1.17 Normal Business Hours 2 1

1.18 Point of Delivery 3 1

1.19 Request for Service 3 1

1.20 Rate Schedule 3 1

1.21 Service or Service Line 3 1

1.22 Standard Delivery Pressure 3 1

1.23 Therm 3 1

II. Initiation of Service 3 2

2.01 Request for Service 3 2

2.02 Acceptance of Request for Service 3 2

2.03 Obligation of Customer and District 3 2

2.04 Turn On and Connection Charges 3 2

2.05 Withholding of Gas Service 3 2

2.06 Discontinuance of Gas Service for Unauthorized Use 4 2

2.07 Limitation of Use 4 2

2.08 Pressure 4 2

2.09 High Pressure 4 2

III. 4 3

3.01 General 4 3

3.02 4 3

3.03 5 3

3.04 Ownership of Property 5 3

3.05 Right of Way 5 3

ii

3.06 5 3

3.07 Access to Premises 5 3

3.08 5 3

3.09 Indemnity 5 3

3.10 Service Charges 5 3

3.11 Excess Flow Valves 6 3

IV. Deposits 6 4

4.01 Establishment of Credit 6 4

4.02 New or Additional Deposits 7 4

4.03 Receipt for Cash Deposit 7 4

4.04 Record of Deposit 7 4

4.05 Interest on Deposit 7 4

4.06 Refund of Deposit When Gas Service Is Disconnected 8 4

4.07 Dishonored Checks 8 4

V. Billing 8 5

5.01 Billing Periods 8 5

5.02 Receipt of Bills 8 5

5.03 Non-Receipt of Bills 8 5

5.04 Initial or Final Bills 8 5

5.05 Customer Discontinuance of Service 8 5

5.06 Calculation of Bill 8 5

5.07 Delinquent Bills 9 5

5.08 Discontinuance of Service for Non-Payment of Bills 9 5

5.09 Adjustment of Bills for Meter Error 9 5

VI. Measurement 10 6

6.01 Measuring Equipment 10 6

6.02 Residential Metering 10 6

6.03 Meter Tests 10 6

6.04 Meter Tests by Request 10 6

6.05 Measurement Standards 11 6

VII. Main and Service Extensions 12 7

7.01 Main Extensions 12 7

7.02 Service Extensions From Existing Mains 13 7

7.03 Relocation of Gas Service Facilities 13 7

7.04 Main and Service Extensions Amortization Surcharge 13 7

VIII. Force Majeure 14 8

8.01 Suspension of Obligation 14 8

8.02 Definition 14 8

IX. End Use Curtailment or Interruption Plan 15 9

9.01 Application 15 9

9.02 Definitions 15 9

9.03 Curtailment Priorities 15 9

9.04 Curtailment of Customer-Owned Gas 15 9

9.05 Curtailment Notice 16 9

9.06 Overrun Penalties and Charges 16 9

9.07 Withholding of Gas Service 16 9

iii

9.08 Liability 16 9

X. Housing Development Incentives 16 10

10.01 Application 16 10

10.02 Value Rating Chart 17 10

10.03 Time 17 10

RATE SCHEDULES

DLM District Labor and Material Charges 17 20

RSS Residential Sales Service 18 21

RSAC Residential Gas Air Conditioning Sales Service 19 22

CSS Commercial Sales Service 19 23

ISS Interruptible Sales Service 20 24

TS Transportation Service 21 25

NCR Negotiated Contract Rate Service 27 26

PGCR Purchased Gas Cost Recovery Provisions 28 27

FORMS

I Request for Service, Residential 28 40

II Request for Service, Commercial Sales 30 41

PRO FORMA CONTRACTS

I Transportation Service 31 70

II Marketer-Lang Customer Contract 50 71

1

RULES AND REGULATIONS

First Revised Sheet No. 1

ARTICLE I

TECHNICAL WORDS, PHRASES, TERMS AND ABBREVIATIONS

Except where the context requires another meaning, the following words, phrases, terms

and abbreviations shall be construed to have the following meanings:

1.01 Abbreviations.

(01) Btu British thermal unit

(02) CCF One hundred cubic feet

(03) CFM Cubic feet per minute

(04) CF Cubic feet

(05) CFH Cubic feet per hour

(06) CSS Commercial Sales Service Rate Schedule

(07) DLM District Labor and Material Rate Schedule

(08) DNQ Daily Nominated Quantity

(09) FERC Federal Energy Regulatory Commission

(10) FGT Florida Gas Transmission Company

(11) ISS Interruptible Sales Service Rate Schedule

(12) MCF One thousand cubic feet

(13) MDSQ Maximum Daily Standby Quantity

(14) MDTQ Maximum Daily Transportation Quantity

(15) NCR Negotiated Contract Rate Service Rate Schedule

(16) PGCR Purchased Gas Cost Recovery Provisions

(17) psi Pounds per square inch

(18) psia Pounds per square inch absolute

(19) psig Pounds per square inch gauge

(20) RSS Residential Sales Service Rate Schedule

(21) RACSS Residential Air Conditioning Sales Service Rate Schedule

(22) TS Transportation Service Rate Schedule

1.02 Billing Period. The Billing Period is each month, based on regularly scheduled meter

readings which are approximately 30 days apart.

1.03 British Thermal Unit. The quantity of heat required to raise the temperature of one

pound of water from 59.0 degrees Fahrenheit to 60.0 degrees Fahrenheit at a constant pressure of

14.73 p.s.i.a.

1.04 Cubic Foot of Gas. For gas delivered at the Standard Delivery Pressure, a cubic foot of

gas is the volume of gas which, at the temperature and pressure existing in the meter, occupies

one cubic foot. For gas delivered at other than the Standard Delivery Pressure, a cubic foot of gas

is that volume of gas which, at a temperature of 60 degrees Fahrenheit and at absolute pressure

of 14.98 pounds per square inch, occupies one cubic foot

2

1.05 Customer. Any person (i.e., individual, firm, partnership, district, corporation,

municipality, cooperative organization, association, governmental agency, or similar

organization) supplied with Gas Service by the District.

1.06 All pipe, fittings, appliances and apparatus of every type

(except metering, regulating and other similar equipment which remains the property of the

District) located on the Customer's side of the Point of Delivery and used in connection with or

forming a part of an installation for utilizing Gas for any purpose.

1.07 Day, Daily or Delivery Gas Day. When capitalized, a twenty-four (24) hour period

beginning and ending at 10:00 a.m. Eastern Time (or such other time as may be provided for a

rence date for any Day shall be the

calendar date upon which said period commences. When not capitalized, day or business day

shall mean a civil day other than Saturday, Sunday, or holiday resulting in the close of business

for the District.

1.08 District. Lake Apopka Natural Gas District, an independent special district created by

the legislature of the State of Florida by Chapter 59-556, Laws of Florida, 1959, and

subsequently modified and reauthorized by Chapter 74-553, Laws of Florida, 1974, and Chapter

99-454, Laws of Florida, 1999.

1.09 Florida Agriculture. Agricultural business within the service territory of the District, as

demonstrated by current annual assessment from the County Property Appraiser of bona fide

agricultural classification for the business location within the District.

1.10 Gas. Natural gas or a mixture of gases suitable for fuel, delivered through the District's

distribution system, having a heating value of not less than 950 Btu's per cubic foot.

1.11 Gas Service. The supplying of Gas or the transportation of Gas by the District to a

Customer.

1.12 Gas Service Facilities. The service line, meter, and all appurtenances thereto necessary

to convey Gas from the District's Main to the Point of Delivery and which are owned by District.

1.13 Heat Only Customer. A residential Customer who receives Gas Service from the

District for no purposes other than air space heating and operating a gas grill and gas lights.

1.14 High Pressure. Gas delivered at any pressure above the Standard Delivery Pressure.

1.15 Main. The pipe and appurtenances installed in an area to convey Gas to other mains or

to service areas.

1.16 Meter. Any device or instrument used to measure and indicate volumes of Gas which

flow through it.

1.17 Normal Business Hours. 8 a.m. to 5 p.m. Monday through Friday, excluding

3

holidays.

1.18 Point of Delivery. The point at which District's Gas Service Facilities are connected to

the Customer's Installation, normally the outlet side of the Meter.

1.19 Request for Service. A request for Gas Service submitted to the District by a

1.20 Rate Schedule. A statement of the rates or charges for a particular classification of all

classes of Customers for Gas Service and the provisions, terms, conditions, classifications,

practices and rules and regulations affecting such rates or charges.

1.21 Service or Service Line. The pipes, regulators, meters and similar equipment installed

1.22 Standard Delivery Pressure. The Standard Delivery Pressure is seven inches of water

column above atmospheric pressure. Normal atmospheric pressure throughout the District's

service area is assumed to be 14.73 p.s.i.a. No adjustment will be made for variations from the

normal atmospheric pressure at the Customer's meter.

1.23 Therm.

Second Revised Sheet No. 2

ARTICLE II

INITIATION OF SERVICE

2.01 REQUEST FOR GAS SERVICE. Gas Service may be requested by a prospective

Customer by submitting to District a completed Request For Gas Service and establishing

creditworthiness pursuant to section 4.01, below.

2.02 ACCEPTANCE OF REQUEST FOR GAS SERVICE . A Request For Gas Service shall

be deemed to be accepted by the District when Gas Service pursuant thereto is initiated.

2.03 OBLIGATION OF CUSTOMER AND District. The terms and conditions of the

Customer's Request For Gas Service, these Rules and Regulations, and the applicable Rate

Schedules shall become binding upon the Customer and District upon acceptance by the District

of the Customer's Request For Gas Service.

2.04 TURN ON AND CONNECTION CHARGES. Whenever Gas Service is established or

reestablished at any location, the charges set forth in rate schedule DLM will be made:

2.05 WITHHOLDING OF GAS SERVICE. District will not provide Gas Service:

(1) to any Customer where it finds that providing Gas Service will create an unsafe or

hazardous condition;

(2) to an existing or prospective Customer where such Customer's use of Gas is or will

4

be detrimental or hazardous to, or jeopardize, the Gas Service supplied to other Customers;

(3) to any Customer when that Customer is in arrears in payment for Gas Service at that

location or another location in the District's service area.

2.06 DISCONTINUANCE OF GAS SERVICE FOR UNAUTHORIZED USE OF GAS.

District will discontinue Gas Service without notice in the event of tampering with regulators,

valves, meters or other facilities furnished and owned by District, or other unauthorized or

fraudulent use of Gas Service. Whenever Gas Service is discontinued for unauthorized or

fraudulent use thereof, the District, before restoring Gas Service, will require Customer to make,

at Customer's expense, all changes in piping or equipment necessary to eliminate the

unauthorized or fraudulent use, and to pay an amount reasonably estimated as the deficiency in

District's revenue and all costs incurred by District resulting from such unauthorized or

fraudulent use.

2.07 LIMITATION OF USE. Gas delivered to a Customer shall be for such Customer's own

use and shall not be resold by such Customer, either by submetering or otherwise. In case of

any unauthorized submetering, sale, or disposition of Gas by a Customer, Gas Service to such

Customer shall be discontinued and will not be restored until such unauthorized activities have

ceased and all bills outstanding have been paid in full. Billings for Gas sold or disposed of by the

Customer shall be recalculated under appropriate rate schedules and, in addition, a bill will be

rendered to the Customer for all expenses incurred by the District for clerical work, testing, and

inspections in connection with such recalculation.

2.08 PRESSURE. District shall make reasonable efforts to maintain its Standard Delivery

Pressure of 14 .98 p. s. I. a. (14. 73 plus .25 p. s. I. g. ) (seven inches water column) at the Point

of Delivery. Where delivery pressure higher than Standard Delivery Pressure is supplied, District

will make reasonable efforts to maintain such higher delivery pressure.

2.09 HIGH PRESSURE. The District does not undertake to deliver Gas at a pressure higher

than the Standard Delivery Pressure throughout its service areas. Prospective industrial and large

commercial Customers who desire to utilize Gas at pressures higher than the Standard Delivery

Pressure should inquire of the District to determine the pressure that the District can make

available at any given location in its service territory before obtaining any equipment requiring

pressures higher than the Standard Delivery Pressure.

Original Sheet No. 3

ARTICLE III

CUSTOMER'S INSTALLATION

3.01 GENERAL. Customer's Installation shall be constructed, installed and maintained, at

governmental codes and ordinances applicable thereto, these Rules and Regulations and other

applicable governmental requirements.

3.02 INSPECTION OF CUSTOMER'S INSTALLATION. Where governmental inspection of

5

a Customer's Installation is required, District will not supply Gas Service to such installation

until all governmental authorities having jurisdiction have inspected and approved the

thereof, is in viol

Installation and Gas Service will be restored only when the noncomplying condition has been

corrected..

3.03

Installation which will affect the operation of any portion of the distribution system of the

District shall be made without written consent of the District. The Customer will be liable for

any damage to the District resulting from a violation of this rule.

3.04 OWNERSHIP OF PROPERTY. The District will own, operate and maintain all service

pipes, regulators, vents, meters, meter connections, valves and other apparatus from District

Main to the outlet side of the Meter.

3.05 RIGHT OF WAY. Customer shall grant to District, without cost to District, all rights,

easements, permits and privileges which in District's opinion are necessary for the rendering of

Gas Service. Customer will furnish to District, without charge, an acceptable location for

District's Meter.

3.06

District's property on Customer's premises, and shall permit no one but District's agents or

employees, or persons authorized by law, to have access to District's piping, meters or apparatus.

In the event of any loss or damage to District's property caused by or arising out of carelessness

or misuse thereof by Customer, Customer shall pay to District the cost of replacing such loss or

repairing such damage.

3.07 ACCESS TO PREMISES. Customer shall give District's authorized agents and

employees access to Customer's property at all reasonable hours for the purpose of installing,

inspecting, maintaining or removing its facilities on Customer's premises, reading Meters and

performing such other actions as are incidental to furnishing or terminating Gas Service to

Customer.

3.08

operate, change or tamper with any of the District's facilities.

3.09 INDEMNITY. Customer shall indemnify, hold harmless, and defend the District from

and against any and all liability, proceedings, suits, cost or expense for loss, damage or injury to

persons or property, in any manner directly or indirectly connected with or growing out of the

Delivery.

3.10

request, Customer shall pay the District the service charges for such work set forth in Rate

6

Schedule DLM.

3.11 EXCESS FLOW VALVES. Prior to, or immediately after, installing a new Customer

Service Line or replacing an existing Service Line, the District will notify the Customer of the

availability of an excess flow valve, the safety benefits of these valves and the costs of their

installation. Excess flow valves meeting the performance standards prescribed by the United

States Department of Transpiration will be made available upon request of the Customer and, if

requ

pays all the costs of installation, including the cost of the valve itself. In addition, the Customer

shall pay all costs of maintenance and repair on the excess flow valve regardless of where it may

Second Revised Sheet No. 4

ARTICLE IV

DEPOSITS

4.01 ESTABLISHMENT OF CREDIT. Each prospective Customer shall establish credit prior

to the commencement of Gas Service by District as follows:

(1) Residential Customers shall establish credit by making a cash deposit in the sum of

$125.00; provided, however, if Gas Service to a residential Customer has been discontinued for

non-payment of bills rendered by the District, the deposit requirement for restoration of Gas

Service shall be $175.00.

(2) All non-residential Customers shall establish credit by making a cash deposit with the

District equal to two times the estimated average monthly bill to be rendered by the District

during periods of peak Gas usage.

(3) As an alternative to making a cash deposit, a non-residential Customer shall have the

option of establishing credit by one of the following methods:

(a) Furnishing an irrevocable letter of credit from a bank, or a surety bond, issued

by a company with an A.M. Best Rating Service rating of B/VI or higher for bonds up to

$50,000 in amount and a rating of A-/VII or higher for bonds over $50,000 in amount. The

amount of such deposit, letter of credit or surety bond shall be equal to two times the estimated

average monthly bill during periods of peak Gas usage.

(b) By possessing and maintaining a Standard & Poor's Long Term Debt Rating

of A- ,or better, or by possessing and maintaining a Moody's rating of A3 or better. Comparable

ratings will be considered from other nationally recognized rating organizations acceptable to

the District.

(c) If the Customer's debt is not rated and the Customer's aggregate annual usage

is 500,000 Therms or more, credit may be established by demonstrating adequate financial

strength and stability. Upon request of a Customer whose annual usage is 500,000 Therms or

more, the District will evaluate the Customer's creditworthiness by reviewing the Customer's

audited financial statements for at least the two most recently completed fiscal years. These

audited financial statements must be furnished by the Customer and must be accompanied by

the opinion of independent certified public accountants or chartered accountants of recognized

national or regional standing. In evaluating the Customer's creditworthiness, the District will

consider the following financial factors: the Customer's tangible net worth, the interest coverage

ratio, the ratio of long term debt to tangible net worth, and the Customer's net cash flow. In

7

evaluating the Customer's credit-worthiness, the District may also consider other known factors

relating to the Customer's creditworthiness. Accounts for which credit is established pursuant to

this section (3) are subject to periodic review by the District to assure that no material changes

adversely affecting the Customer's credit-worthiness have occurred. Each Customer for whom

credit is established pursuant to this section (3) shall annually furnish audited financial

statements, together with the opinion of independent certified public accountants or chartered

accountants of recognized national or regional standing, to the District within 90 days following

the conclusion of the Customer's fiscal year. In the event (i) the debt rating or audited financial

statements are unacceptable to the District, or become unacceptable, or (ii) the Customer pays

with a check dishonored by a bank, or (iii) the Customer fails to comply with the District's Rules

and Regulations, credit may be established by either a cash deposit, a letter of credit or a surety

bond.

(4) A parent company may serve as a guarantor for a subsidiary company to secure the

payment of bills for Gas Service provided the parent company can meet the requirements for

establishing credit as stated in subsections (2) or (3), above.

4.02 NEW OR ADDITIONAL DEPOSITS. Whenever a non-

usage increases for reasons likely to recur (such as, for instance, installation of additional gas

appliances or increased work schedules) to the extent that the actual or estimated charges for Gas

Service for two peak Gas usage Billing Periods will exceed the amount of the cash deposit, or

other security, made or furnished by the Customer, the District will require, upon thirty (30) days

written notice delivered to Customer separate and apart from any bill for Gas Service, an

Section 4.01, above, so that the amount of the cash deposit, or other security, is equal to the then

current actual or estimated charges for Gas Service for two peak Gas usage Billing Periods. If

Customer has received Gas Service continuously during the 12 month period immediately prior

to the date of notice, actual Gas consumption shall be used. If Customer has received Gas

Service for less than 12 months, then District will base the amount of the new or additional cash

deposit, or other security, upon estimated Gas usage when actual Gas usage is not available.

The 30 day notice shall not apply when Gas Service is being reestablished after discontinuance

of service for non-payment.

4.03 RECEIPT FOR CASH DEPOSIT. A non-transferable receipt will be issued to a

Customer for any cash deposit and means provided so that such Customer may claim the deposit

if the receipt is lost.

4.04 RECORD OF DEPOSIT. With respect to a cash deposit, District will keep-records to

show:

(1) The name of the Customer making the deposit;

(2) The premises occupied by the Customer;

(3) The date and amount of the deposit; and

(4) Each transaction concerning the deposit.

4.05 INTEREST ON CASH DEPOSIT. District will not pay interest on cash deposits for Gas

Service.

8

4.06 REFUND OF DEPOSIT WHEN GAS SERVICE IS DISCONNECTED. Upon

termination of Gas Service, a cash deposit may be credited against the final account and the

balance, if any, shall be returned to the Customer within fifteen (15) days after Gas Service is

discontinued.

4.07 DISHONORED CHECKS. Customer shall pay a service charge in accordance with

Section 832.07, Florida Statutes, as may be amended from time to time, of $25, if the face value

does not exceed $50, $30, if the face value exceeds $50 but does not exceed $300, $40, if the

face value exceeds $300, or an amount of up to 5 percent of the face amount of the check,

whichever is greater, for each check delivered to the District which is dishonored by the bank

upon which it is drawn. Gas Service will be terminated for failure to pay such dishonored check

charge.

First Revised Sheet No. 5

ARTICLE V

BILLING

5.01 BILLING PERIODS. The District will render bills for Gas Service each month at

intervals of approximately 30 days; provided, however, if a Customer is, or during the past six

(6) months has been, in arrears in the payment of bills for Gas Service, the District, as an

alternative to discontinuance of Gas Service, may initiate more frequent billing and payment

periods as a means of eliminating, or avoiding recurrence of, an arrearage in payment.

5.02 RECEIPT OF BILLS. Bills shall be considered received by Customer when mailed to

the most recent billing address supplied by Customer to District.

5.03 NON-RECEIPT OF BILLS. Failure of Customer to receive a bill shall not relieve

Customer of its obligation to pay the bill.

5.04 INITIAL OR FINAL BILLS. When the period of Gas Service for which an initial or

final bill is rendered is less than a normal Billing Period, the Customer shall be charged the

normal customer charge multiplied by the result of the number of days Gas Service was rendered

during the Billing Period divided by thirty (30); provided, however, when the period of Gas

Service is seventy-five (75) percent, or more, of a normal Billing Period, there shall be no

reduction in the normal customer charge.

5.05 CUSTOMER DISCONTINUANCE OF SERVICE. Unless otherwise provided in the

specific Rate Schedule under which Customer receives Gas Service, a Customer intending to

discontinue Gas Service shall furnish notice of such intent to District not less than five business

days prior to the desired date of such discontinuation. Customer shall be responsible for all Gas

Service provided to the premises at which discontinuance is desired until the expiration of five

business days following District's receipt of the notice required above. District will

automatically terminate Gas Service to a Customer after acceptance by District of a Request For

Gas Service of a succeeding occupant of the premises previously occupied by the Customer

requesting termination of Gas Service.

9

5.06 CALCULATION OF BILL. If a Customer takes Gas Service under more than one Rate

Schedule at a single Delivery Point, the bill shall be calculated separately for the Gas Service

provided under each such Rate Schedule. If a Customer takes Gas Service under one or more

Rate Schedules at two or more Points of Delivery, a bill shall be calculated separately for Gas

Service provided under each Rate Schedule at each Point of Delivery. If District must, for

reasons of its convenience, establish more than one Point of Delivery at a single premise, the

readings of the Meters for like classes of service will be combined.

5.07 DELINQUENT BILLS. A bill shall be considered delinquent upon the expiration of

fifteen (15) days from the date of mailing or other delivery thereof by District. Charges for

services due and rendered which are unpaid as of the past due date are subject to a Late Payment

Charge of $5.00 or 1.5% of the balance , whichever is greater, except the accounts of federal,

state, and local governmental entities, agencies, and instrumentalities. A Late Payment Charge

shall be applied to the accounts of federal, state, and local governmental entities, agencies, and

instrumentalities at a rate no greater than allowed, and in a manner permitted by applicable law.

5.08 DISCONTINUANCE OF SERVICE FOR NON-PAYMENT OF BILLS. Gas Service

will be discontinued for non-payment of bills but only after District has made a diligent attempt

to have the Customer make payment, including at least five (5) business days' written notice to

Customer, such notice being separate and apart from any bill for Gas Service, unless the

controversy over the nonpayment has been resolved through mutual agreement, or successfully

disputed by Customer.

5.09 ADJUSTMENT OF BILLS FOR METER ERROR. If a Meter is found to be in error,

bills will be adjusted in the following manner:

(1) Whenever a Meter is found to have an average error of more than two percent (2%)

fast (

the period since the last meter test. This one half period will not exceed twelve (12) months

unless it can be shown that the error was due to some cause, the date of which can be fixed, in

which case the overcharge shall be computed back to, but not beyond, such date based on

available records. If the Meter has not been tested, the period for which it has been in service

beyond the regular test period will be added to the twelve (12) months in computing the refund.

The refund will not include any part of any customer charge.

(2) Whenever a Meter tested is found to have an average error of more than two-percent

l Customer an amount equal to the unbilled

error. If District has required a meter test deposit, Customer will be billed only for the portion of

the unbilled error which is in excess of the deposit retained by District.

(3) District will back bill Customer if a Meter is found to be slow, non-registering or

partially registering. District will not back bill for any period greater than twelve (12) months

from the date it removes the meter of a Customer, which Meter is later found by District to be

slow, non-registering or partially registering. If it can be ascertained that the Meter was slow,

nonregistering or partially registering for less than twelve (12) months prior to removal, then

District will back bill only for the lesser period of time. Customer may extend the payments of

the back bill over the same amount of time for which District issued the back bill.

(4) In the event of a non-registering or a partially-registering Meter, Customer will be

10

billed on an estimate based on previous bills for similar usage. When a Meter is found to be in

error in excess of the prescribed limits of two percent (2%) fast or slow, the figure to be used for

calculating the amount of refund or charge shall be that percentage of error as determined by the

test.

(5) In the event of unauthorized use, Customer will be billed on an estimate of the Gas

ther facts and

during the period of unauthorized use.

Original Sheet No. 6

ARTICLE VI

MEASUREMENT

6.01 MEASURING EQUIPMENT. District will provide, install, own, operate and maintain at

its expense the Meters, recording devices and regulating or measuring equipment needed to

accurately measure the quantity of Gas provided to Customer, except for specialty equipment

needed for Customers who elect to receive transportation service from the District. All

Customers receiving transportation service shall be responsible for all costs associated with the

purchase, installation and maintenance of metering devices and, if required, telemetering

equipment; however, the metering equipment shall be the property of the District. The

expense such check measuring equipment as desired provided that such equipment shall be so

installed as no

6.02 RESIDENTIAL METERING. Except as hereinafter provided, each separate residential

occupancy unit shall be individually metered. Individual meters shall not be required, and

master metering permitted, for separate residential occupancy units:

(1) where dimensions or physical configurations of the units are subject to alteration;

(2) where Gas is used in central heating, water heating, ventilating and air conditioning

systems, or gas back up service to storage heating and cooling systems;

(3) in specialized-use housing accommodations such as hospitals and other health care

facilities, college dormitories, convents, sorority or fraternity houses, motels, hotels and similar

facilities;

(4) in specially designated areas for overnight occupancy at trailer, mobile home and

recreational vehicle parks where permanent residency is not established;

(5) in marinas where living aboard is prohibited by permanent means; or

(6) where individual Gas Service would otherwise be required above the second story.

6.03 METER TESTS. District will periodically test Meters to ensure they properly and

accurately measure the Gas Service provided to Customer.

6.04 METER TEST BY REQUEST. Customer may request the Meter be tested pursuant to

the following conditions and provisions:

(1) Upon written request of a Customer, District shall, without charge, make a test of the

11

accuracy of the Meter in use at Customer's premises; provided (i) that the Meter has not been

tested by District within 12 (twelve) months previous to such request and (ii) that Customer

agrees to accept the results of such test as the basis for the adjustment of disputed charges.

(2) Should Customer request a meter test more frequently than once a year, District will

require a deposit to defray the cost of testing not to exceed $100.00 for each test. If the Meter is

found to be more than two percent (2%) fast, the deposit shall be refunded, but if below this

accuracy limit the deposit will be retained by District as a service charge for conducting the test.

(3) Customer may witness the Meter test. A written report, giving the results of the test,

shall be furnished to Customer upon request.

6.05 MEASUREMENT STANDARDS. For purposes of measurement of Gas, the following

standards shall be applied.

(1) Base Conditions. The following base conditions shall apply:

(a) A standard cubic foot for measurement purposes shall be the volume of such

cubic foot at a temperature of 60 degrees Fahrenheit and an absolute pressure of 14.73 psia

(b) The average atmospheric pressure shall be assumed to be fourteen and seventy

three hundredths pounds per square inch absolute (14.73 psia) irrespective of actual elevation or

location of the point of measurement or of variations in such atmospheric pressure from time to

time.

(2) Volumetric Measurement. The following standards and assumptions shall apply to

measurement of volume:

(a) The Standard Delivery Pressure shall be 14.98 psia and the standard delivery

temperature shall be 60 degrees Fahrenheit.

(b) For purposes of billing computations a Cubic Foot of Gas shall be that

quantity which, at a pressure of 14.98 psia and a temperature of 60 degrees Fahrenheit, occupies

one cubic foot.

(c) When deliveries are made at flowing pressures in excess of the Standard

Delivery Pressure, metered volumes shall be corrected for such variation through utilization of

recorded flowing pressure data, correction devices which are an integral part of the Meter

installation, or by correction factors for fixed pressure deliveries.

(d) With respect to Gas delivered at High Pressure, flowing gas temperature shall

be assumed to average 60 degrees Fahrenheit for all measurement, unless the Customer and the

District agree otherwise. When an assumed flowing temperature of 60 degrees Fahrenheit is not

used, the temperature shall be determined as the arithmetic average of flowing temperatures as

recorded by a temperature recorder, if such a recorder is utilized, or through the use of correcting

indices or temperature compensating meters. Where recording or compensating devices are not

installed, the temperature of the Gas shall be assumed to be the climatological 30 year average

monthly temperature as established by the nearest National Oceanic and Atmospheric

Administration Weather Bureau, and published by the Department of Commerce.

(e) Unless determined to be otherwise by a gravity balance the specific gravity of

the flowing gas shall be assumed to be 0.6.

(f) When sales or transportation volumes are metered at pressures of 10 psig

(pounds per square inch gauge) and over, and where such volumes are also corrected for flowing

temperatures other than assumed 60 degrees Fahrenheit, such volumes shall be corrected for

deviations from Boyles Law by use of the appropriate supercompressibility factor.

(3) Billing Units. For purposes of billing, the unit shall be determined as follows:

12

(a) The billing unit of Gas shall be the Therm. The number of Therms billed to a

Customer shall be determined by multiplying the number of Cubic Feet of Gas delivered at 14.98

psia and 60 degrees Fahrenheit, by the total heating value of such gas and dividing the product

by 100,000.

(b) The total heating value of the Gas delivered to the Customer shall be

determined as that reported monthly by the District's gas supplier, provided such value is

applicable to the Gas delivered to the Customer, or such value shall be determined by the District

by use of a calorimeter or other instrument suitable for heating value determination. The total

heating value shall be corrected to and expressed as that contained in the unit of sales and

transportation volume defined above.

(4) Quality. The District shall deliver Gas which is free of dangerous or objectionable

quantities of impurities such as hydrogen sulphide or other impurities which may cause

excessive corrosion of Mains or piping or from noxious or harmful fumes when burned in a

properly designed and adjusted burner. This provision is intended to protect the health and safety

of the public and in no manner does it guarantee compatibility with the operation of delicate or

sensitive machinery, instruments, or other types of apparatus which my be damaged by moisture,

grit, chemicals or other foreign substances which may be present in the Gas but which are

nevertheless within limits recognized as allowable in good practice.

First Revised Sheet No. 7

ARTICLE VII

MAIN AND SERVICE EXTENSIONS

7.01 MAIN EXTENSIONS. Whenever a prospective Customer or other person, such as a real

estate developer, municipality, township, county, or other authority (hereinafter referred to as

"Depositor") , requests gas service at a location where the District does not have a Main, the

District will extend its Mains and Gas Service to serve the prospective Customer or Customers

under the following conditions:

(1) The extension of gas service to the prospective Customer will not jeopardize gas

service to existing Customers.

(2) The District determines, in its sole discretion, that it has sufficient capital resources

available for Main extension purposes to finance its obligations under the Main extension

policies.

(3) The maximum capital cost to be incurred by the District for an extension of Main and

service facilities shall be defined as the Maximum Allowable Construction Cost (hereinafter

seven times the estimated annual revenue

to be derived from the facilities less the cost of Gas. Where the District, in its reasonable

discretion, believes that there is significant uncertainty regarding the revenues to be derived from

sales made from the requested extension of Main and service facilities, the District shall use

reasonable efforts to calculate the MACC giving due consideration to such uncertainty.

(4) Where the facilities to be installed will require an investment by the District in excess

of the MACC, the District will construct the necessary facilities provided the Customer or

Depositor deposits with the District an amount equal to the excess of the estimated actual

construction cost over the MACC. In this case, the District and the Depositor will then enter into

ding for

13

receipt of the deposit by the District, the respective obligations of the parties in connection with

the Main extension and the terms and conditions for a refund, if any, to the Depositor. The

deposit will be used by the District to finance the cost of extending the Mains and related

facilities and will not bear interest.

(5) Refund of Deposits. Deposits shall be refunded to Depositors in accord with the

following procedures:

(a) As new Customers connect to the extended Main or service facilities, and no

less often than on each of the first seven anniversaries of the date on which the deposit is made to

the District, the District shall refund to the Depositor an amount equal to (I) the actual or

estimated annual revenue, less the cost of gas, derived from sales to Customers served by the

extended facilities, less (ii) the MACC as determined in paragraph 7.01(3), above, divided by

seven (7).

(b) For each additional Customer taking gas service from any point on the

extended Main or service facilities within a period of seven (7) years from the date of

construction, the District shall refund to the Depositor the amount by which the MACC of the

new Customer exceeds the cost of connecting such new Customer, provided that an additional

Main extension shall not have been necessary to serve such additional Customer. Where the

Depositor and the District agree that new Customers are likely to connect to the extended

facilities over a period longer or shorter than seven years, the Depositor and the District may

agree, within the Construction Deposit Agreement, to provide for refunds over such longer or

shorter period as the parties agree is reasonable and appropriate under the circumstances.

(c) The aggregate refund to any Depositor made through the provisions of (a) and

(b) above shall not exceed the original deposit of such Depositor.

(d) The extension shall at all times be the property of the District, and any

unrefunded portion of said deposit at the end of seven (7) years, or such longer or shorter period

as may be agreed by the Depositor and District pursuant to subsection (5)(b) above, shall accrue

to the District.

7.02 SERVICE EXTENSIONS FROM EXISTING MAINS. The District will install, at no

charge to the Customer, the Gas Service facilities, commencing from an existing Main, necessary

to serve a Customer applying for gas service, where the cost of such Service extension does not

exceed the MACC as defined in section 7.01(3), above. Customers not meeting the above criteria

will be required to make a contribution in aid of construction based on the difference between the

cost of the required Service facilities and the MACC as calculated for each respective Customer.

7.03 RELOCATION OF GAS SERVICE FACILITIES. When alterations or additions to

structures or improvements on premises to which the District renders Gas Service necessitate the

relocation of District's metering equipment, or when such relocation is requested by the

Customer for whatever reason, Customer may be required to reimburse the District for all or any

part of the costs incurred by the District in the performance of such relocation.

7.04 MAIN AND SERVICE EXTENSIONS AMORTIZATION SURCHARGE. In cases

where (i) the estimated actual cost of extending necessary Main and Service facilities exceeds the

MACC; (ii) the District, in its reasonable discretion, determines that there is a reasonable

likelihood that such extension will produce sufficient revenue to justify the necessary investment

14

in such facilities; and (iii) the District determines that the credit-worthiness of the party or parties

requesting the extension is satisfacto