LINE OF CREDIT NOTE

* * * * * * * * * *

NAME: CORNING NATURAL GAS CORPORATION

NOTE DATE: September 1, 2011

ADDRESS: 330 William Street

NOTE MATURITY: August 31, 2012

Corning, New York 14830

NOTE NUMBER: 7002029533

ACCOUNT NUMBER:

$750,000.00

FOR VALUE RECEIVED, the undersigned, CORNING NATURAL GAS CORPORATION , an entity
organized and existing under the laws of the State of New York with an office at
330 William Street, Corning, New York 14830, (hereinafter called "Borrower"),
promises to pay pursuant to the repayment terms set forth below, to the order of
FIVE STAR BANK, a New York State bank (hereinafter called "Bank") with its
principal office at 55 North Main Street, Warsaw, New York 14569, or at such
other place as may be designated in writing by the holder of this Note the sum
of Seven Hundred Fifty Thousand and 00/100 Dollars ($750,000.00) in lawful money
of the United States, or so much as may be advanced, referred to as "principal
sum", with interest hereon to be computed from the date hereof as follows:

From the date hereof through and including August 31, 2012 (the "Maturity Date")
the unpaid

principal sum shall bear interest at the rate of 4.25 percent per annum (the
"Fixed Rate")

Payment Terms.

Commencing on November 1, 2011 and on the 1st day of each month thereafter
through and including the Maturity Date, the Borrower shall pay to Bank twelve
(12) payments of interest only. Unless sooner accelerated or demanded under the
term thereof, the Borrower shall pay all unpaid principal, interest and any
costs hereunder to the Bank on the Maturity Date.

The annual interest rate for this Note shall be computed on a 365/360 basis;
that is, by applying the ratio of the annual interest rate over a year of 360
days, multiplied by the outstanding principal balance, multiplied by the actual
number of days the principal balance is outstanding. Borrower will pay Bank at
Bank's address shown above or at such other place as Bank may designate in
writing.

Application of Payment.

All payments of principal and accrued interest shall be applied to the
indebtedness under this Note in a manner and order acceptable to the Bank, in
its sole discretion.

After Acceleration or Maturity (whichever is earlier), interest shall accrue on
the unpaid principal balance of this Note at a rate 3% per annum greater than
the pre-Acceleration or pre-Maturity interest rate, until this Note is paid in
full. In no event however, shall the interest rate on this Note exceed the
maximum rate allowed by law.

In the event any payment due hereunder shall remain unpaid for more than ten
(10) days, the holder hereof may collect a late charge in the greater of four
percent (4%) of said payment, or $50.00 to cover its extra handling expenses.

Any payment made with a check which is dishonored shall be subject to a
dishonored check charge in the amount required by the Bank. The Bank may require
this to be paid immediately or it may be added to the balance of the loan or
withdrawn from the account.

Purpose.

The loan proceeds will be used for the following purpose(s): Refinance Five Star
Bank Term Loan _____

Covenants.

Loans made pursuant to this Note are conditioned upon the prior approval of Bank
in its sole and absolute discretion. Requests for Bank approval of a loan may be
instituted at any time prior to the date that Bank or Borrower terminates this
Note, or prior to the time at which Bank demands payment of the Consolidated
Loan (defined below), whichever date is earlier. A loan request by Borrower
which Bank approves, is referred to below as an "Approved Request". The fact
that a particular loan request is not approved by Bank, shall have no affect on
(a) this Note, (b) the right of Borrower to make subsequent loan requests, or
(c) the obligations of Borrower under this Note including but not limited to the
obligations to pay the Consolidated Loan in full On Demand.

Bank shall process an Approved Request by debiting Borrower's revolving loan
account for the amount of the Approved Request and, unless otherwise agreed by
Bank and Borrower, by crediting Borrower's checking account identified above
with Bank with the amount of the Approved Request. The loan shall be deemed made
immediately upon the crediting of the amount of the Approved Request to
Borrower's checking account with Bank or otherwise making the amount of the
Approved Request available to Borrower. Each Approved Request, together with the
unpaid principal balance of previous loans made under this Note, shall be deemed
automatically refinanced and consolidated into one (1) loan, hereafter called
the "Consolidated Loan".

Loan requests may be issued by Borrower in writing, in person over the telephone
and via fax and via e-mail by an Authorized Person designated below. Borrower
may, from time to time, add to or delete from the list of Authorized Persons by
giving Bank written notice of such changes. Notice of any additions or deletions
shall be sent to Bank at 55 North Main Street, Warsaw, New York 14569, to the
attention of Commercial Loan Department.

Bank is authorized to act on telephone, written, fax or e-mail loan requests and
prepayment instructions of any person identifying himself as an Authorized
Person, and Borrower will be bound by such instructions. Borrower hereby
indemnifies and holds Bank harmless from any liability (including reasonable
attorneys' fees) which may arise as a result of Bank's good faith reliance on
telephone loan requests and or payment or prepayment instructions from any
person identifying himself as an Authorized Person.

Bank may terminate its obligations under this Note at any time upon telephonic,
facsimile or written notice to Borrower at Borrower's address specified above.
Borrower may terminate its right under this Note at any time upon written notice
given to Bank at Bank's address specified above. The termination of this Note by
either or both parties shall not effect Borrower's obligations under this Note
(including but not limited to Borrower's obligations to pay accrued interest on
the unpaid principal balance of the Consolidated Loan and the obligation to pay
the Consolidated Loan on demand), nor Bank's rights against Borrower under this
Note until the Consolidated Loan (and all accrued interest due and to become due
Bank thereon) is paid in full.

Each of the persons whose name appears below, (followed by his or her signature)
is an "Authorized Person". Any Authorized Person may make loan requests under
this Note and give payment or prepayment instructions, as specified above.

Upon the occurrence of any of the following, Borrower shall be in default. Upon
the occurrence of a default, Bank may declare the entire unpaid principal
balance of this Note immediately due and payable ("Acceleration"), without
notice, presentment, demand or protest of any kind, all of which are hereby
waived by Borrower.

Borrower's failure to make any payment to Bank under this Note when due.

Borrower's failure (or the failure of any Borrower, if more than one Borrower
signed this Note) or of any other person or entity liable to Bank for payment of
the indebtedness evidenced by this Note ("Guarantor"), to perform or comply with
any term or provisions or covenant under any other loan documents executed by
Borrower or Guarantors in favor of Bank.

Falsity of any representation or warranty contained in any loan document
executed by Borrower in favor of Bank.

Entry of a judgment and/or filing of a federal tax lien against any Borrower
and/or against any Guarantor.

Commencement of a bankruptcy proceeding by or against any Borrower and/or by or
against any Guarantor.

If Borrower is a corporation, limited liability company or partnership, the
dissolution, merger, consolidation or failure to maintain itself as corporation,
limited liability company or partnership in good standing.

Death of any individual Borrower and/or of any individual Guarantor.

The making by any Borrower and/or by any Guarantor of a bulk sale or other
disposition of substantially all of its assets.

Insolvency (in the form of a negative net worth as defined under generally
accepted accounting principles) of any Borrower and/or of any Guarantor.

A material adverse change or deterioration in the financial condition of the
Borrower.

Bank receives notice from any Guarantor of the discontinuance of his liability
to Bank.

Discontinuance of any Borrower's business and/or of any corporate Guarantor's
business.

Repossession of or the appointment of a receiver or custodian for any property
of any Borrower and/or of any Guarantor.

Failure of Borrower to comply with any financial covenant or supply accurate and
timely financial information as required herein.

In the event this Note is referred to an attorney for collection, Borrower shall
pay all Bank's costs of collection, including Bank's reasonable attorneys' fees,
incurred and to be incurred in connection with the enforcement and collection of
this Note, including, but not limited to, attorneys' fees incurred and to be
incurred in any bankruptcy proceeding involving Borrower or any Guarantor, if
any, of this Note.

The Borrower agrees so long as this loan remains unpaid to: (a) keep proper
books of accounts in a manner satisfactory to the Bank; (b) permit inspections
and audits by the Bank of all books, records, and papers in custody or control
of Borrower or others, relating to Borrower's financial condition, including the
making of copies thereof, and abstracts therefrom, and inspection and appraisal
of any of Borrower's assets; (c) submit timely and accurate financial
information to the Bank, acceptable in form and content to the Bank, in its sole
discretion, which financial information must include (i) for entity Borrowers
and Guarantors, annual audited or reviewed or compiled financial statements
prepared by an independent Certified Public Accountant within one hundred twenty
(120) days after each fiscal year-end and copies of federal tax returns with all
schedules, and (ii) for individual Borrowers and Guarantors, personal financial
statements and copies of federal tax returns with all schedules, and (iii) Bank
may also require interim management prepared financial statements provided on a
quarterly basis, updated rent rolls and other financial information, and (iv)
any other periodic financial statements reasonably requested within thirty (30)
days after requested by Bank; (d) promptly pay all taxes, assessments, and other
governmental charges, provided however, that nothing herein contained shall be
interpreted to require the payment of any such tax so long as the validity is
being contested in good faith; (e) keep all of its property so insurable insured
at all times with responsible insurance carriers against fire and other hazards
in such manner and to the extent that like properties are usually insured by
others operating businesses, plants and properties of similar character in the
same general locality, and keep adequately insured at all times with responsible
insurance carriers against liability on account of damage to persons or
property, and under all applicable worker's compensation laws; and (f) promptly
inform the Bank of the commencement of any action, suit, proceeding or
investigation against Borrower, or the making of any counterclaim against
Borrower in any action, suit or proceeding, and of all liens against any of its
property. In addition to other remedies provided under the loan documents
executed in connection with this loan, the Bank reserves the right to (i)
require Borrower and/or Guarantor to pay the Bank $250.00 for each thirty (30)
days the financial information is past due, and/or (ii) charge the default rate
of interest under this Note until the required financial information has been
submitted to and approved by Bank, in its sole discretion.

This Note is governed by New York law. BORROWER WAIVES THE RIGHT TO A JURY TRIAL
IN ANY LITIGATION OF ANY NATURE OR KIND IN WHICH BORROWER AND BANK ARE BOTH
PARTIES. Any litigation involving this Note shall, at Bank's option, be triable
only in a court located in Wyoming County, New York. Borrower acknowledges that
it has transacted business in New York State with regard to this Note.

The failure of any person or entity to sign this Note shall not release,
discharge or affect the liability of any person or entity that signs this Note.
This Note has been unconditionally delivered to Bank by each person or entity
that signs this Note.

Security and Setoff.

As security for this Note, and any renewal or extension hereof, and for all
other obligations, direct or contingent, of Borrower to Bank, now due or to
become due whether now existing or hereafter arising, (this Note and such other
obligations being herein referred to as the "Obligations"), Borrower gives Bank
a security interest in all funds, deposits and other property, and the proceeds
thereof, now or hereafter in the possession or control of Bank for the account
of Borrower ( the "Deposits"). Bank may at its option and at any time(s), with
or without notice to Borrower, set off or realize upon any and all Deposits, and
apply them to the payment or reduction of all or any of the Obligations (whether
or not then due), in such manner as Bank may determine, in its sole discretion.
Bank shall not be obligated to assert or enforce any rights under this paragraph
or to take any action in reference thereto, and Bank may in its discretion at
any time(s) relinquish its rights under this paragraph as to a particular
Deposit without thereby affecting or invalidating its rights as to any other
Deposit. The Bank's right of setoff applies to all accounts and deposits held at
the Bank or any other bank owned by Five Star Bank.

This Note may not be modified or terminated orally. Borrower acknowledges that
this Note has been executed for commercial and/or business purposes. If more
than one Borrower has signed this Note, all obligations of each Borrower under
this Note are joint and several. Wherever used in this Note, neutral pronouns
shall include the masculine and feminine gender as appropriate in the context,
and singular terms (such as "Borrower") shall be deemed in the plural where
appropriate.

Borrower represents and warrants to Bank that no adverse change has occurred in
either (i) Borrower's or Guarantor's financial condition since the date of
Borrower's loan application to Bank or (ii) the collateral being pledged to the
Bank to secure the Bank's loan. In addition, Borrower hereby agrees to fully,
unconditionally and expeditiously comply with any post closing issues or
requirements of the Bank, including, but not limited to furnishing additional
documents or executing additional or corrected documents in favor of the Bank.

It is hereby expressly agreed, that all of the covenants, conditions and
agreements contained in the Mortgage or Security Agreement securing this Note or
other loan documents, as applicable, are hereby made part of this Note.

Each of the persons whose name and signature appears on the attached Addendum is
an "Authorized Person". Any Authorized Person may make loan requests under this
Note and give prepayment instructions, as specified above.

Presentment for payment, notice or dishonor, protest and notice of protest are
hereby waived.

Borrower Name: CORNING NATURAL GAS CORPORATION

Signature:

/s/ Michael German

Print Name and Title:

Michael German, CEO

_________________________

Borrower Name:

CORNING NATURAL GAS CORPORATION

Signature:

/s/ Firouzeh Sarhangi

Print Name & Title:

Firouzeh Sarhangi, CFO

________________________

Witness: ________ _____________

William E. Bacon, Vice President

Five Star Bank

ADDENDUM TO LINE OF CREDIT NOTE 7002029533

IN THE AMOUNT OF $ 750,000.00

DATED SEPTEMBER 01, 2011

Each of the persons whose name and signature appears on this Addendum is an
"Authorized Person". Any Authorized Person may make loan requests under this
Note and give payment instructions, as specified above.

Michael German

/s/ Michael German

Name of Authorized Person

Signature of Authorized Person

Firouzeh Sarhangi

/s/ Firouzeh Sarhangi

Name of Authorized Person

Signature of Authorized Person