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As indicated in Table 1, the assessments are expected to increase to a high of $148 per <br />share, which is $39 higher than the current assessment level. Through most of the loan <br />period, the assessments will average about $139, which is $30 higher than the current <br />levels. <br />Credit worthiness. This CWCB loan is for $1,900,000 with the first payment due in <br />2011, and the final payment being in 2040, with a yearly payment of approximately <br />$95,687.77. The Company currently has only the vehicle and property loans outstanding <br />(Page 10). FMRICo has a long-term relationship with the Bank of the West in Fort <br />Morgan and has the ability to borrow money as required to conduct their normal <br />business. <br />COLLATERAL <br />The Fort Morgan Reservoir & Irrigation Company can offer the following collateral for <br />the CWCB loan: <br />1. The revenue from assessments as allowed by Company Bylaws and <br />Original Articles of Incorporation and subject to prior rights of current <br />creditors <br />2. Project Reserve Fund at local bank in the amount of one annual payment <br />3. The project infrastructure itself <br />OPINION OF FEASIBILITY <br />There do not appear to be significant roadblocks that would keep the FMRICo from <br />successfully completing this project. The project does raise the average assessment level <br />by approximately $30.00 per share of stock. The benefit of this project is that it will <br />directly help sustain approximately 16,000 acres of irrigated agriculture, while also <br />providing wildlife habitat benefits. <br />12 <br />