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AGUA — Water Rights Purchase/Recharge Project September 22-23, 2003 Agenda Item 5c Table 2. Financial Ratios Financial Ratio Without With projecf the project) Future Year 2001 2002 2004+ Operating Ratio (revenue/expense) weak: less than 100% $1 % 80% 120% average: 100% - 120% (weak) (weak) (aver.) stron : reater than 120% Debt Service Coverage Ratio (revenues-expenses)/debt service -183% -1387% 103% weak: less than 100% (weak) (weak) (aver.) average: 100% - 125% stron : reater than 125% Cash Reserves to Current Expense weak: less than 50% 166% 235% 80-95%* average: 50% - 100% (strong) (strong) (aver.) strong: greater than 100% Annual Operating Cost per Acre-Ft. weak: greaterthan $20 (Depletions) $18 $23 $25 — 75* average: $10 - $20 strong: less than $10 *Varies, assuming 14,000 to 9000 Acre-Ft. replacement at $12 to $60 per Acre-Ft. Table 3 shows the required annual payments on AGUA's existing loans as well as the proposed loan: Table 3. CWCB Loan Summary''` Loan No. 2004 — 06 2006-33 2034-38 C153800 $3,082 C153678 $27,964 $27,964 $27,964 (Revised) Excelsior Loan $46,366 $46,366 Totals $77,412 $74,330 $ 27,964 *Does not include 10% reserve requirement. Generally, AGUA will fulfill its annual CWCB loan obligation by assessing 1/3 against well membership, and 2/3 against replacement water usage per acre-foot. For example, in 2004-2006, the loan obligations will total $77,412. The loan charge per AF would vary depending on the total amount of replacement water that AGUA is able to offer, as shown below: Loan Fee per Well $27,000 (450 wells x$60) Loan Charge per AF 5Q.412 (14,000 AF x$3.60; 9000 AF x$5.60; 5000 AF x$10.08) $77,412 Election — The purchase agreement between AGUA and the seller requires that AGUA's membership approve the purchase. AGUA has conducted a membership proxy vote by mail, with voting required on or beforE September 10, 2003. A letter from AGUA Secretary Clifford Walter has been received Page 7 of 9