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operate water, wastewater and reclaimed water utility systems within the area of FELLSMERE set forth in Exhibit "A" ("Service Area"). Such water, wastewater , and reclaimed water utility systems shall consist of all water, wastewater and reclaimed water facilities (including, pipes, fixtures, mains, valves, meters, tanks, lift stations, etc., and telephone and electric lines for water, wastewater, and reclaimed water utility system use) for the purpose of supplying water, wastewater and reclaimed water utility service to the Service Area and the inhabitants thereof. Section 4. Franchise Term and Renewal. The term of this Franchise Agreement and the Franchise granted hereunder shall be for a period of Twenty-five (25) years commencing on the Effective Date. This Franchise Agreement shall automatically renew for an additional 25 years unless either party provides notice to the other party of its intent to terminate this Franchise Agreement at least 4 years prior to the expiration of this Franchise Agreement. Section 5. Utility Rates and Fees. The rates for water, wastewater and reclaimed water utility services established and charged by COUNTY for customers within the Service Area shall be no greater than the rates for such utility services as published by the COUNTY for the various rate classifications served. Likewise, any and all other fees and charges established and imposed by COUNTY shall correspond to such fees and charges assessed by COUNTY and shall be no greater that those imposed by COUNTY in each rate classification. The foregoing rates, fees, and charges shall be adopted and applied to each customer's utility billing commencing with the customer's first utility bill that is produced subsequent to Thirty (30) days from the Effective Date. The rates, fees, and other charges assessed shall be adjusted by COUNTY at the same time as any other adjustment made by COUNTY of its corresponding charges and fees. COUNTY shall provide the City Manager of FELLSMERE for review and comment any proposed rate or fee adjustments no less than Thirty (30) days before the adjustment is scheduled to go before the COUNTY Board of County Commissioners for consideration. Notwithstanding any of the foregoing language to the contrary, all rates, fees and regulations established by COUNTY shall be otherwise reasonable; and the rates and fees charged by COUNTY shall at all times be subject to such regulation as may be provided by state law. Further, the parties recognize that the right to establish and regulate water, wastewater and reclaimed water rates, impact fees, service policies or other rules or regulations, and the construction, operation or maintenance of the water, wastewater and reclaimed water utility system shall be vested solely in COUNTY, except as such may be otherwise subject to the applicable laws of the Federal Government and the State of Florida or the provisions of this Franchise Agreement. Section 6. COUNTY Franchise Fee. COUNTY may charge a franchise or fee -in -lieu - of -franchise fee up to six percent 6% of the gross revenues received by COUNTY from the sale of water, wastewater and reclaimed water services in the Service Area. The franchise or fee -in -lieu fee shall be calculated as a percentage of the gross revenue derived from the sale of water, wastewater, and reclaimed water services as applicable. Such fee shall be shown on the customers' bills as a separate line item. FELLSMERE acknowledges and agrees that such fee is an acceptable, bargained -for fee. Page 2 of 7