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<br />WATER PURCHASE AND SALE AGREEM,ENT
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<br />THIS Water Purchase and Sale Agreement ("Agreement") is made aad entered
<br />into this � day of S'.a..+L, 2UQ7, by and between 3T CATIZE COMPANY, a S�' S1
<br />CoLorado Corporation, henein,after rcfe.ned to as "Sell�r", and KEVII�1 LAMB, S liM�- �'' `/
<br />hereinafter referred to as "B�yer". The Seller and Buyer may hereinafter be referred to �
<br />individually as "Party" and callectively as the "Parties",
<br />R�ITNESS�TS:
<br />'WHEREA�S, the Sella is the owner of 5 shares of capitat stock of the Weldon
<br />Valley Diteh Co:npany ("Water Rights"); and
<br />WHEREA3, the Buyer desines to purchase the above described Weldon Valley
<br />Ditch Company stock; and
<br />WHSREAS, the Seller and Buyer rcpresent to each other thai each has the
<br />suthority, power and right to euter into ttus agr�meat.
<br />NOW T"HER�'ORE, in ccnsideration of the foregoing rxitala, the mutual
<br />coveaants and agr�ements contained I�erein, and othet gaod at►d valuable consideration,
<br />the adequacy, �u�eiency and receipt of wluch is hareby acknowledged, the Partiea
<br />hereby agtee as follows:
<br />1.. Sale and Purch�e. The Seller agrecs to aell and the Buyer agrees to gurchase
<br />from 5eller the above described Wat�r Rights, fY+ee and clear of all liens, taxes,
<br />asseasments and encumbraacas and aubject oNy to (1) certain lease aad contract
<br />oblig,ations pursnant to agreem�ents with Orphan Wells of Wiggins (OWW), and (2) prior
<br />loan from CWCB, at tk�e price and upon the tesmos aad condi6ona hereina�ter set forth.
<br />2. Purchase Price. The total purchase price for the said Water Rights shall be
<br />$3UU,000.00 ("Purcl�ase Price"), whieh Purchase Priee shatl be represented by a
<br />Promissory Note exe�uted by the Buyer and delivered to the Seller at the closing and
<br />delivary of said shares, which Note shall accrue interest at the rate of 54b per aru►um aud
<br />Shall be due and payable in 15 anuual installment paym�nts of $28,902.69, principal aud
<br />interost inclusive, the same to eomrnenoe on December I5, 2007 and to cQntinue oa the
<br />13� day of December of each and every year thereafter, and if aot sooner �xiid, the final
<br />installment shall due and payable no lata than Dece�nbcr 15, 2021. 5aid Note shall
<br />contain a dcfault interest rate of 1296 per annum and a IaEe pay�at charge of 596 of any
<br />installment not paid withia 10 days from the date the same bacame due and payable. The
<br />3e11er agrees rha�t the BuYer maY P�Y �Y and all prinaipal or interest bal�lc�os at atty
<br />rime without penatty. The Buyer shail pledge and assign t6e above Water Rights to the
<br />Sellsr as sec�rity for rcpayment of the above Pronoissory Note, T'he Buyar shall not be
<br />allowed to assign, tiansfer, convey or cncumber ilae Watcr Rights, whi¢h are security for
<br />the above i'romissory Note, without the express written conse�st of the Seller. Th� shares
<br />rePr�sentaa8 the above W�ter Rights shall be held by the Seller u�til the Buyer has paid
<br />tht above Fi�aussory I+iote in full at which time tbe Seller shal� release its security
<br />interest in and to said eertificatcs aad shall forthwith deliver the same to the Buyer.
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<br />3. Clo�ing. Qosing of this agreement sha11 talce glace on June�, 2007 at such
<br />time:md pla�ce as the Pazties may muWatly agree. 1�
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<br />4. Contin�ency. T'his agrecmcnt is expressly contingent upon the Parties herew
<br />closing on th�e Conttact to Buy aad �ell Real Estate on the pmpqRy &nown as 3T Ca�tle
<br />Company locatsd at 1629$ County Road O, Fort Morg�, Colorado 84701. In the event
<br />said contract for the purchaae.aad sate of the dcsignated real estatc faila to close, d�en in
<br />that event, this contract shall be null, void and of no effect aad each of the Pattiea sha�2 be
<br />�leased of aay and all obligations hereunder, saving and exc�pting any legal
<br />nesponsibilities in the event either Party herew should default or breaeh the terms aad
<br />ptouisions of this agneement or the Conteact to Buy aud S�ell Raal Estate.
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