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8.1.1 Water Rights Valuation LLRC acquired an appraisal of the four shares of LLDC stock that was purchased in February 2007 from the Rothe Farms (currently financed by CWCB Loan under Contract No. C150253). A copy of the water rights appraisal is provided in Appendix D. The appraisal for the Rothe Farm water rights determined a value of $1,575,000 for four shares of LLDC, or $393,750 per LLDC share. Utilizing this per share appraised value, the subject 5.0 shares of LLRC are estimated to have a value of $1,968,750 ($398,750 per share x 5.0 shares =$1,968,750). Table 2 provides a summary of the projected costs associated with the water rights acquisition. TABLE 2 Cost Projection Water Ri hts Ac uisition En ineerin & Le al Costs: Legal Fees $1,500 En ineerin Fees — Water Ri ts Anal sis $5,500 Estimated Total En ineerin /Le al Costs $7, 000 Lower Latham Ditch Shares $1,968, 750 Estimated Brid e Loan Interest & Bank Fees $25, 000 Estimated Total Costs $2,000,750 8.2 Rechar�e Facilities The plan for augmentation includes the construction of recharge reservoirs under the Lower La�ham Ditch system to facilitate the winter augmentation obligations associated with the LLRC plan for augmentation. The recharge reservoir will be operated by delivering water available pursuant to the LLDC water rights through the Lower Latham Ditch and into the recharge facilities. Alternatively, water available pursuant to the LLDC water rights, and other water rights available to the LLRC plan for augmentation, may be placed into a temporary storage account in Lower Latham Reservoir, then released from storage and conveyed to the recharge facilities through the Lower Latham Ditch. Winter recharge accretions to the South Platte River subsequently occur and will be utilized with the LLRC plan for augmentation to offset winter return flow obligations and lagged stream depletions caused by pumping of inembership wells. -9-