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South Metro Water Supply Authority <br />March 10, 2009 (UPDATED March 18, 2009) <br />Page 8 of 8 <br />Agenda Item 14b <br />2) Purchase/Operating Agreements: The Authority must have a final purchase agreement and final <br />operating agreement executed with copies submitted to the CWCB. <br />3) Prior to signing a contract with the CWCB, the Authority must provide an executed step up <br />provision (as part of the Authority's participation agreement) whereby, in the event of default by <br />one of the borrowers, all of the remaining participants in the Project (Castle Pines North <br />Metropolitan District, Centennial Water and Sanitation District, Cottonwood Water and <br />Sanitation District, Inverness Water and Sanitation District, and the Town of Castle Rock) will <br />be required to pay for the defaulting party's commitment and that the payments due must be <br />sufficient to enable the Authority to meet the CWCB debt service requirements. This step up <br />provision must be signed by all participants in the Project. The terms of the step up provision <br />shall be as agreed upon by the CWCB and Authority prior to execution with participants. <br />4) To utilize construction funds in a timely manner, the Authority will have a two-year time limit <br />from CWCB approval to execute a funding contract with the CWCB. If a contract is not <br />executed within two years of Board approval, the Project will be recommended for loan de- <br />authorization unless the Board specifically approves a time extension. <br />cc: Rod Kuharich, Executive Director, South Metro Water Supply Authority <br />Rick Brown, CDM <br />Susan Schneider, AGO <br />Attachment: Water Project Loan Program - Project Data Sheet <br />