Elkhead Reservoir Final Acquisition Agreement

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4. Prudent Practice. Operator shall undertake its efforts to operate, maintain and repair the Reservoir Enlargement in a prudent and responsible manner in accordance v~~ith generally accepted practices relating to reservoir operations for the primary purposes of storing and releasing Stored Water for the Parties' beneficial uses thereof. The Operator shall keep the Parties fully and promptly advised of major changes in conditions or other major developments which affect the operation, maintenance or repair of the Reservoir Enlargement, though the Yampa Participants shall have no involvement in the operation of Reservoir Enlargement. The Operator of the Enlarged Reservoir shall provide the Parties with monthly accounting reports of water storage and release or as more frequently agreed to by the Parties. The Operator shall promptly provide the Parties a copy of all dam inspection reports received from the State Engineer's Office or any other agency. B. Annual Service Charge. Yampa Participants shall pay an annual service charge to the Operator for their use of the reservoir storage and release facilities fiunished pursuant to this Amended and Restated Agreement, at the rate set forth on Exhibit C, subject to this rate being reviewed and adjusted according to the terms set forth on said Exhibit. C. Reconstruction. The following provisions shall apply if the Reservoir Enlargement requires reconstruction stemming from a substantial failure of the dam embankment and related appurtenances and for reasons unassociated with the willful misconduct of the Operator: The cost of said reconstruction shall be shared by the Parties that participate in the reconstruction. Such participating Parties shall negotiate an agreement concerning the cost of reconstruction (including a proper performance bond to be obtained therefor), required to provide capacity for those Parties in the reconstructed reservoir. 2. The Yampa Participants may participate in any project undertaken by Craig and/or the River District, to reconstruct a reservoir, subject to paying their share of the costs of engineering, permitting and construction activities and other required work based upon the amount of water storage capacih~ they desire to be restored for their use. 3. If Craig and/or the River District do not provide notice of intent to participate in the costs of a reconstruction project within one year after the event or decision causing the need for reconstruction, the Yampa Participants shall have the right to cause the reconstruction of the reservoir facilities (including just a portion thereof) at their ow•n expense. The commencement of construction activities by the Yampa Participants shall occur v~~ithin three years after notice is pro~Zded by Craig and the River District that they do not intend to participate. Upon timely ., i