A. W. Peters, Inc.

35  Summer  St.
P.O. Box 550
Peterborough , NH   03458

 June 29, 2007

Dear Pre-Paid Fuel Oil Customer:

The 2007-2008 heating season will    be upon us before you know it. The combination of winter arriving late and the lack of a significant cold snap made for a fairly stable fuel oil market. There were no violent spikes or supply interruptions and markets regained some sanity and prices actually fell. Consequently, although everyone conserved as much as possible, those with fixed price contracts did not make out as well as they had in the past. Many of you, and we are grateful for your comments, reminded us that, for 17 out of 20 years, our contracts have provided you with peace of mind and produced significant savings. With continued market volatility and the lack of downside protection, understand that many oil companies would prefer not to sell contracts, but consumers often demand them. 

What's in store for this season?  Good question.  We have spoken with several knowledgeable analysts and consultants about the fuel oil markets.  The hope was to get as many opinions as possible and that they would all reach the same conclusion.  However, there has been no consensus, which shouldn't surprise anyone who follows commodity or financial markets.  Some analysts suggest that we wait to offer a contract but, knowing our customers, we feel many would be too uncomfortable waiting until September. The bottom line is that no one can truly predict the oil markets today.

After all that being said, we will offer you a contract and ensure that it is adequately protected. Signing this contract binds you to a fixed price per gallon for deliveries between now and May 31st, 2008. We have added the clause that you must be on automatic delivery and agree to accept delivery of heating oil only from this company through the length of your contract.  This is being done as a result of a couple of people deciding after we purchased their oil in good faith, to put their accounts on a will-call basis.  They never called and then asked for a rebate May 31st.  If you have always been a will-call customer and honored your contract, there will be no need for you to worry.  Please call us and feel free to continue as you have in the past. We simply ask you to remember that you are signing a binding contract.

Please note that, as in the past, there is a clause stating our right to suspend this plan in the event of a supply crisis as happened six years ago.  If our suppliers cannot provide our price protected gallons due to shortages, we may have to suspend your price protection until those gallons are made available to us.  You would not lose those gallons and we would reinstate your plan once the crisis is rectified. While we don’t anticipate such an event, this clause is written into the contracts we purchase on your behalf and must be part of our contract with you.

If you are nervous about a fixed price contract, please consider our budget.  Budgets have limited price protection in both directions and actually did better than prepaid contracts last year. Our 10 month budgets pay the cash price, not to exceed $2.779 and would not go below $2.379 per gallon for #2 fuel.  If you would like more information on the budget, it will be posted on our website www.awpeters.com. As always, you can call 934-3388 or e-mail awpeters@monad.net with your questions.   Although we cannot recommend one plan over the other, we do think you should consider some form of price protection.

Lastly, we realize everyone checks prices and wants the best deal.  We have always offered you contracts that were fair and provided you with the best options available while being responsible and protecting ourselves as well.  We provide you with exceptional customer service and the most experienced service technicians in the Monadnock Region.  We value your business and hope that you value the services we provide.

Sincerely,

Jeffrey S. Peters
President

Acct#___________Name__________________________

Please be aware you are purchasing a fixed price contract with your signature below.  All deliveries will be made at this price until you have used up your prepaid allotment and this contract expires on May 31, 2008.  This plan has NO down side protection.  Prepaid gallons will be used first and deliveries at the market price are available only after your contract gallons are used.  Customers must be on automatic delivery unless arrangements are made with Jeff.   As stated on the cover letter, this contract may be suspended in the event of a supply crisis.

Contract prices are as follows:

#2 Fuel                        $2.579 per gallon        Senior Citizen Rate is $2.539 per gallon

#3  Outside Mix         $2.629 per gallon        Senior Citizen Rate is  $2.589 per gallon

Kerosene                    $2.999 per gallon        Senior Citizen Rate is $2.959 per gallon

Yes, I am a senior citizen____ I will be at least 62 years young as of Sept. 1, 2007.  DOB___________

Estimated gallons for the 2007-2008 season_______   gallons of   #2  #3mix  Kero

Estimated yearly cost (gallons x price per gallon)    $________=       $_________

Less any credit balance as of June 27, 2007                                        ____________

Actual amount of check or credit card to cover season $_____________

While we can take your credit card information on this contract, you may also go to our website www.awpeters.com and make a payment using a secure site.  When asked for an invoice number, please use your account number (which is on line 1 of this document) followed by the two digit month and two digit year. For example: 1234X0707

Master Card or Visa only:  CC#_____________________Exp date____/_____

Name as it appears on the card_____________________________________

The deadline for purchasing this contract is July 20^th, 2007.  Contracts are secured by your signature and receipt of your payment.  Prices are subject to change after this date.  If you need assistance filling out this form, please call Jeff or Wendy at 924-3388. You can also email Jeff at awpeters@monad.net or wendy@awpeters.com

I agree to purchase my heating oil only from A.W. PETERS, INC. for the length of this contract and I understand that this contract may be suspended in the event of a supply crisis. 

Your signature is required to secure this contract.

______________________

Date of acceptance_______________