Hardy Storage Company, LLC

Original Volume No. 1

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

Original Sheet No. 144 Original Sheet No. 144 : Effective

GENERAL TERMS AND CONDITIONS (Cont’d)

amount of Penalty Revenues. Seller will include interest on the Penalty

Revenues balance at the rate specified in the Commission's Regulations at

Section 154.501(d)(1). For each month of the preceding contract year, Seller

shall allocate Penalty Revenues for that month to the Non-Penalized

Customers based on their respective HSCQ as reflected on Customer’s Billing

Statement for that month under the Non-Penalized Customers' HSS and IHSS

Service Agreements. Seller shall credit the bills of Non-Penalized

Customers that are the original capacity holders (and not Replacement

Customers under Section 14 (Release and Assignment of Service Rights) of the

General Terms and Conditions) for such allocated amounts within 60 days of

the end of the contract year. To the extent that there are no Non-Penalized

Customers in a month in which there are Penalty Revenues, the Penalty

Revenues will be carried forward to the next succeeding month and will be

allocated to Non-Penalized Customers in that month.

(d) Seller will file a report within 60 days of the close of the

contract year showing the Penalty Revenues, the costs netted against the

Penalty Revenues, and the resulting Penalty Revenue credits for each month

of the contract year.