Hardy Storage Company, LLC

Original Volume No. 1

Effective Date: 04/01/2007, Docket: CP05-150-003, Status: Effective

Original Sheet No. 63 Original Sheet No. 63 : Effective

GENERAL TERMS AND CONDITIONS (Cont’d)

(1) Seller shall assess the bids to assure that capacity is

available. If capacity is not available, Seller shall reject the bids

and advise Customer.

(2) Seller shall evaluate bids based upon their net present value

as set forth below, taking into account the price and term offered.

Seller shall use the current Commission-approved interest rate in

calculating the net present value of bids. Capacity shall be awarded,

as set forth in paragraph (d) below, based on the acceptable highest

value of the bids offered to Seller calculated in accordance with this

Section. Seller shall publish the winning bids on its EBB.

(d) Awarding Capacity; Pro Rata Awards To Equal Bidders. Consistent

with the bid assessment criteria set forth in paragraph (c) immediately

above, Seller shall award capacity: (i) first to an existing capacity holder

that exercises a right of first refusal to match the highest value bid; and

(ii) then to the bidder submitting the highest value bid or if two or more

bidders submit equal acceptable highest value bids then pro rata to all

bidders that submitted equivalent highest value bids based upon daily

quantities requested.

(e) Binding Nature of Bids. All bids are binding; provided, however,

that a bidder may decline to accept a pro rata allocation of capacity

resulting in an award of less than the full capacity requested if such

Customer notifies Seller of that decision through Seller's EBB within one

hour of Seller's notice to that Customer of the pro rata allocation.

Otherwise, if a successful bidder fails to execute a Service Agreement within

15 days after such Service Agreement is tendered by Seller, (or such later

date established by Seller through notice to Customer), Seller will then

award the capacity to the next acceptable bidder on the basis of the highest

net present value, as described in this Section. Customers failing to return

such Service Agreement shall be removed from Seller's Approved Bidders List

for six months, or less than six months if agreed to in writing by the

Seller. Nothing herein shall restrict Seller from pursuing any other

remedies it may have against a Customer failing to execute and return a

Service Agreement tendered by Seller. If Seller finds no other bid

acceptable, the capacity shall be posted again and thereby made available for

a new round of bids.