Eastern Shore Natural Gas Company

Second Revised Volume No. 1

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Effective Date: 11/01/1997, Docket: CP96-128-004, Status: Effective

Original Sheet No. 127 Original Sheet No. 127 : Effective

EASTERN SHORE NATURAL GAS COMPANY

GENERAL TERMS AND CONDITIONS

(Continued)

13. Right of First Refusal Procedures (Continued)

(d) The Best Bid relating to each Service Agreement shall

be determined by Seller through the non-discriminatory

application of the following criteria:

(1) The bid with the highest net present value of

reservation charges.

(2) In the event Seller receives two (2) or more bids of

equal net present value, then the Best Bid shall be

the bid with the shortest term. If two (2) or more

bids are tied Seller will select the Best Bid based

on the first in time to submit said bid.

(e) Buyer shall have the right to continue to receive

service by notifying Seller in writing within fifteen

(15) calendar days of receiving Seller's notification of

the Best Bid that said Buyer agrees to match the Best

Bid. In such event, Buyer and Seller shall, prior to the

expiration of the Service Agreement(s), execute a new

Service Agreement(s) setting forth terms and conditions

consistent with the Best Bid. Such Service Agreement(s)

shall be effective as of the day following the expiration

of the expiring Service Agreement(s).

(f) If Buyer elects not to match the Best Bid, then such

election shall constitute an irrevocable waiver of said

Buyer's right of first refusal and Seller shall execute

a Service Agreement(s) with the bidding Buyer submitting

the Best Bid and shall provide such service pursuant to

the terms and conditions contained in the Best Bid.