IV. Treatment of Revenues

The revenue from the license and the proposed lease will be treated as Other Operating Revenue (OOR). Under the gross revenue sharing mechanism, all applicable gross revenues recorded from non-tariffed products and services subject to the mechanism will be split between shareholders and ratepayers after the Commission-adopted annual threshold level of OOR has been met. For those non-tariffed products and services deemed "passive" by the Commission, the revenues in excess of the annual threshold will be split between shareholders

and ratepayers on a 70%/30% basis. The proposed lease here is passive for revenue sharing purposes.²