Kentucky Public Service Commission

Order Entered: 1. Lyon District is authorized to enter into an agreement with KRWFC to borrow no more than $1,523,500 for the purpose of refunding the outstanding indebtedness, but only under such terms and conditions that will produce both positive gross savings and net present value savings. 2. If the actual terms and conditions of the agreement with KRWFC differ from those set forth in its application, Lyon District shall, within 30 days of executing the loan agreement, file with the Commission amortization schedules and work papers showing the actual gross savings and net present value savings that will result from the refinancing. 3. Within 30 days of executing the proposed agreement, Lyon District shall file a copy of the executed Assistance Agreement and any documents referenced in the executed Assistance Agreement that Lyon District has not previously filed with the Commission. 4. The proceeds from the Assistance Agreement shall be used only for the lawful purposes specified in Lyon District's application. 5. Any documents filed pursuant to ordering paragraphs 2 and 3 of this Order shall reference the number of this case and shall be retained in the utility's general correspondence file.

Order Entered: (1) Lyon District's motion to deviate from 807 KAR 5:001, Section 11(2)(a) is granted. (2) Lyon District's application is considered filed as of the date of this Order. (3) Nothing contained in this Order shall preclude the Commission requiring the production of information regarding Lyon District's financial condition or operations since December 31, 2011.

Acknowledge Receipt of Filing

Application of Lyon County Water District to Issue Securities in the Approximate Principal Amount of $1,385,000 for the Purpose of Refunding Certain Outstanding Revenue Bonds of the District Pursuant to the Provisions of KRS 278.300 and 807 KAR 5:001