COMMUNITY BANK, N.A.

LINE OF CREDIT AGREEMENT

As of: March 31, 2010

Mr. Michael I. German, President Corning Natural Gas Corp.

330 West William Street

Corning, NY 14830

Dear Mr. German:

This letter sets forth the governing terms of our agreement between Community
Bank, N.A. (the "Bank") and Corning Natural Gas Corp. (the 'Borrower")
concerning a revolving line of credit (the "Revolving Line") in the aggregate
maximum amount outstanding at any one time of $7,000,000.00, subject to the
terms of this letter. This Revolving Line was committed by the provisions of a
commitment letter from the Bank to the Borrower dated March 11, 2010 (the
"Commitment Letter"), the contents of which are herein incorporated by
reference.

Definitions

As used herein, the following terms shall have the following meanings:

"Eligible accounts receivable" shall be all trade accounts of the Borrower less
than 90 days beyond the date of invoice (and originating in the ordinary course
of business) minus all contra accounts receivable, affiliate company accounts
receivable and employee accounts receivable.

"Miscellaneous eligible inventories" shall be all ordinary-course non-gas
inventories of the Borrower valued at cost.

"Rabbi Trust" refers to the assets held in the investment account of the
Borrower numbered 89151111309 held by Community Bank, N.A.

"Third Party Borrowing Notice Event" means the acceptance by the Borrower of a
new indebtedness financing commitment from a party other than the Bank which,
upon closing thereof, would result in the Borrower having incurred aggregate
indebtedness exceeding $2,500,000.00 to one or more parties, other than the
Bank, following the effective date of this

agreement. Commitments for refinancing indebtedness that exists at the time of
the Term Loan closing do not count against this Event threshold.

"Tangible Net Worth" means the total value of all assets excluding goodwill and
intangible assets, less total liabilities, as determined by reference to the
year-end audited financial statements of the Borrower, commencing with those for
the fiscal year ending September 30, 2009.

"Debt to Tangible Net Worth Ratio" is defined as the dividend ratio of all Debt
of the Borrower divided by its Tangible Net Worth, as determined by reference to
the year-end audited financial statements of the Borrower commencing with those
for the fiscal year ending September 30, 2009.

"Debt Service Coverage Ratio is defined as the dividend ratio of

[(net income, excluding other comprehensive income, + depreciation and
amortization + interest) minus (dividends + distributions), divided by [current
maturity loan term debt from the prior period financial statement + interest],
as determined by reference to the year-end audited financial statements of the
Borrower, commencing with those for the fiscal year ending September 30, 2009.

General Terms of Revolving Line

Proceeds of the Revolving Line shall be used for Borrower's working capital
purposes needs. So long as no Event of Default exists under this Agreement or
under the terms of any other agreement or loan document between the Borrower or
any Guarantor hereunder and the Bank, the Borrower may borrow, repay, and
reborrow under the Revolving Line from time to time so long as the aggregate
principal amount outstanding at any one time does not exceed $7,000,000.00 and
the Bank has not demanded payment in full. Notwithstanding the foregoing,
beginning March 31, 2010, aggregate borrowings at any one time under the
Revolving Line may not exceed the sum then available according to the following
formula:

100% of all "eligible accounts receivable" of the Borrower;

Plus 100% of all gas inventory of the Borrower;

Plus 50% of all "miscellaneous eligible inventories" of the Borrower;

Plus 100% of the value of the "Rabbi Trust";

Minus the balance of term loan #4280406-9001.

The Borrower shall execute a Demand Grid Note (the "Revolving Line Note")
evidencing obligations related to the Revolving Line in a form acceptable to the
Bank.

All outstanding amounts under the Revolving Line shall bear interest until paid
in full. The rate of interest payable hereunder shall be a fluctuating rate per
annum (the "Stated Rate") equal to the greater of 4% or the 30-day Libor Rate
plus 2.25%, with changes to occur

automatically with changes in the 30-day Libor Rate from time to time in effect.
Each change in the Stated Rate shall take effect simultaneously with the
corresponding change in such Libor Rate. The "30-day Libor Rate" shall mean the
30-day Libor Rate as published by the Wall Street Journal from time to time
during the period that any portion of the principal hereunder remains unpaid.
Interest shall be calculated based on actual days elapsed divided by a year of
360 days. Changes in the rate of interest applicable to the Revolving Line Note
shall become effective automatically and without notice at the time of changes
in the 30-day Libor Rate. The Bank, shall, however, provide the Borrower with
notice of changes which have occurred in the rate applicable to the Revolving
Line during the preceding billing period in its regular billing statements.

Unless sooner demanded, payments of all accrued interest under the Revolving
Line are due and payable on the first day of each month. All remaining
outstanding principal and accrued interest under the Revolving Line shall be due
and payable in full on the earlier of (i) February 28, 2011, or (ii) the date of
a demand by the Bank, or (iii) the date of an Event of Default (collectively,
the "Expiration Date") unless the Revolving Line is extended by the Bank in its
sole discretion. The Revolving Line will terminate on, and the Bank shall have
no further obligation to make credit available after, the Expiration Date.

Any monthly payment amount due not fully paid within ten (10) days after the
date due shall be subject to a late payment charge of the greater of $25.00 or
five percent (5%) of the total payment due.

Fees and Expenses

The Borrower shall pay any fees, expenses and disbursements, including
reasonable legal fees, of the Bank related to the Revolving Line and the
transactions contemplated by this letter. Such payments shall be due from time
to time upon the Bank giving the Borrower notice of the amount of such expenses.

At the request of the Bank, the Borrower shall promptly pay any expenses,
reasonable attorney's fees, costs, or disbursements in connection with
collection of any of the obligations related to the Revolving Line or
enforcement of any of the Bank's rights hereunder or under any note, guaranty,
or other agreement related hereto. This obligation shall survive the payment of
the Revolving Line Note. The Bank may apply any payments of any nature received
by it first to the payment of obligations under this paragraph, notwithstanding
any conflicting provision contained in this letter or any other agreement with
the Borrower.

Upon the occurrence of an Event of Default and acceleration by the Bank of the
Revolving Line Note such that it becomes immediately due and payable in full,
the rate of interest on each of the obligations related thereto shall be
increased to a rate at all times equal to two percent (2%) above the rate of
interest which would be in effect absent such Event of

Default, such increased rate to remain in effect through and including payment
in full of all of the Obligations, or written waiver of such Event of Default by
the Bank.

Collateral and Guarantees

The Revolving Line obligation shall be secured by the following:

 * A continued first security interest in accounts receivable, inventory,
   chattel paper, documents, instruments and general intangibles; and
 * A continued first security interest in the Rabbi Trust,

both as evidenced by a Security Agreement between the Borrower and the Bank
dated August 4, 2005, as modified by a Collateral Security Spreader Agreement
dated November 28, 2005, and as restated by a new Security Agreement between the
parties hereto of even date herewith..

No Guaranty of the Revolving Line obligation is required to be furnished by the
Borrower.

Affirmative Covenants

So long as this agreement remains in effect or there exists any indebtedness
owing to the Bank by the Borrower hereunder, it is agreed that the Borrower
shall:

 A. Keep proper books of account in a manner satisfactory to Bank. The Bank
    acknowledges that the accounting system, procedures, and forms in use as of
    the date hereof are satisfactory;
 B. Permit, at Borrower's expense, inspections and audits by Bank or by its
    agents of all books, records and papers in the custody or control of the
    Borrower or of others relating to the financial business condition of the
    Borrower, including the making of copies thereof and abstracts therefrom,
    and inspection and appraisal of any of their assets, with reasonable notice
    and during regular business hours;

C. Deliver to the Bank the following fmancial information: (i) annual financial
statement of the Borrower audited by a Certified Public Accountant in accordance
with standards established by the American Institute of Certified Public
Accountants within 120 days after the end of its fiscal year; (ii) quarterly SEC
Form 10-Q within 60 days following the end of each calendar quarter; (iii)
within 45 days following the close of each month, monthly financial statements
prepared by the Borrower; and (iii) a monthly report within 30 days following
each month end, in form and substance satisfactory of the reasonable
requirements of the Bank, setting forth reconciliation of accounts receivable
with agings, inventory, and borrowings under

the Revolving Line; (iv) immediately upon the occurrence of a Third Party
Borrowing Notice Event, written notice thereof; and (v) such other information
as the Bank may from time to time reasonably request.

    Promptly pay all taxes, assessments and other governmental charges due from
    the Borrower, provided, however, that nothing herein contained shall be
    interpreted to require the payment of any such tax so long as its validity
    is being contested in good faith.

 A. Promptly inform the Bank of the commencement of any material action, suit,
    proceeding or investigation against the Borrower, or the making of any
    counterclaim against it in any action, suit or proceeding, and of all liens
    against any property of either. An action, suit, proceeding, investigation,
    or lien shall be deemed material when in the aggregate the face amount of
    all such pending claims, reduced by the amounts (excluding deductibles and
    retained limit self-insurances) of indemnity insurance coverages
    acknowledged by the insurers as applicable thereto, exceeds $100,000.00.
 B. Maintain a Tangible Net Worth of not less than $9,000,000
 C. Maintain a Debt to Tangible Net Worth Ratio of less than 3.5 to 1.0. H.
    Maintain a Debt Service Coverage Ratio of not less than 1.10 to 1. Negative
    Covenants

So long as this agreement remains in effect or there exists any indebtedness
owing to the Bank by the Borrower hereunder, it is agreed that the Borrower
shall not:

 A. without the prior written consent of the Bank having first been obtained,
    create, incur, assume or suffer to exist any security interest, mortgage,
    pledge, lien or other encumbrance upon any of your accounts receivable and
    inventory, whether now owned or hereafter acquired, except in our favor and
    except liens of taxes not in default or being contested in good faith;
    provided, however, that if any proceeding before the United States Tax
    Court, Borrower is adjudged liable for unpaid taxes and wish to appeal from
    such adjudication, it shall promptly take appropriate steps to stay
    assessment of any lien of such taxes.
 B. sell, convey, lease or transfer any of its assets other than in the ordinary
    course of business, or merge or consolidate with or into any other company
    or corporation;

Events of Default

All of obligations of the Bank hereunder to the Borrower may be immediately
terminated and the entire unpaid balance of all indebtedness hereunder owing to
the Bank may be declared to be immediately due and payable at the sole election
of the Bank upon the happening of any one of the following specific events of
default:

 A. Nonpayment of any principal of or interest on any indebtedness created
    hereunder within fifteen (15) days after its due date, or default by the
    Borrower in the performance of any of other material terms or conditions of
    this agreement or of any other agreement of the Borrower with the Bank,
    which default remains uncured fifteen (15) days after written notice thereof
    has been furnished by the Bank to the Borrower;
 B. The adjudication of the Borrower as a bankrupt, or the making by the
    Borrower of any general assignment for the benefit of creditors, or the
    institution by it of any type of insolvency proceeding or of any proceeding
    for the liquidation or the winding-up of its affairs, or the appointment of
    a receiver or trustee for the Borrower of its assets, or the approval as
    properly filed of a petition for the reorganization of it under the
    Bankruptcy Act of otherwise, or its filing of any petition for an
    arrangement under Chapter XI of the Bankruptcy Act or under any similar
    statute;
 C. If any certificate, statement, representation, warranty or audit furnished
    by the Borrower or on its behalf in connection with this arrangement
    (including those contained herein) or as an inducement to the Bank to enter
    into this agreement shall prove to have been false in any material respect
    at the time as of which the facts therein set forth were certified or
    stated, or to have omitted any substantial contingent or unliquidated
    liability or claim against the Borrower, or if on the date of the execution
    of this agreement, there shall have been any materially adverse change in
    any of the facts disclosed by any such certificate, statement,
    representation, warranty or audit, which change shall not have been
    disclosed by the Borrower to the Bank at or prior to the time of such
    execution;
 D. Nonpayment by the Borrower of any other indebtedness to the Bank within
    fifteen (15) days after the date when due.

E. There occurs any substantial change in the ownership of the Borrower, by
merger with another entity or otherwise, or operating control of the business of
the Borrower, without the prior written consent of the Bank having first been
obtained.

Miscellaneous Terms

The Bank shall have a right of set-off, in the full amount of all of Borrower's
obligations to the Bank, against any deposits, assets held by, or other amounts
owed by the Bank to or held by the Bank for, the Borrower as well as a lien on
any and all property of the Borrower which is or may be in the Bank's
possession.

No delay or omission by the Bank in exercising any right or remedy hereunder or
with respect to any indebtedness created hereunder shall operate as a waiver
thereof or of any of other right or remedy, and no single or partial exercise
thereof shall preclude any other or further exercise thereof of any other right
or remedy.

The parties hereto expressly waive all rights to trial by jury on any cause of
action directly or indirectly involving the terms or conditions of this
Agreement, the Revolving Line Note, or any matters whatsoever arising out of or
in connection with this Agreement, the Revolving Line Note, or any document
executed or delivered in connection with this Agreement or the Revolving Line
Note. The foregoing waiver shall survive the termination or expiration of this
Agreement.

This Agreement and the documents referred to herein embody the entire agreement
and understanding among the parties and supersede all prior agreements and
understandings relating to the subject matter hereof. This Agreement shall not
be changed or amended without the written agreement of all parties hereto.

All the terms and provisions of this Agreement shall inure to the benefit of and
be

binding upon and be enforceable by the parties and their successors and assigns
and shall inure to the benefit of and be enforceable by any holder of notes
executed hereunder. No assignment of the rights of the Borrower under this
Agreement may be made without the prior written consent of the Bank.

This letter and the notes and agreements related hereto, together with all of
the rights and obligations of the parties hereto, shall be construed, governed
and enforced in accordance with the laws of the State of New York. It represents
the joint agreement of the parties following negotiation resulting in the
issuance of the Commitment Letter, and accordingly shall not be strictly
construed against any particular party.

Please sign the enclosed duplicate original of this letter to evidence your
agreement to the terms contained herein. We appreciate the opportunity to do
business with you.

COMMUNITY BANK, N.A.

____________________________

by:
Thomas F. Beers, Vice President

CORNING NATURAL GAS CORP.

____________________________

by:
Michael I. German, President