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Grand Mesa Reservoir Co. Agenda Item 5b September 22-23, 2003 (Updated September 25, 2003) Table 3 is a summary of the financial aspects of the project with a 20-year loan. Annual assessments have recently been increased to $5 per share, and will need to be increased further to $6.50 per share with a CWCB loan payment of $6,291 (including the 10% reserve requirement.) This $1.50 assessment increase represents $1.70 per acre-foot, based on average annual diversions of 1,000 acre-feet. Table 3. Financial Summary (20-year loan) Pro'ect Cost $100,000 CWCB Loan 90% of Pro'ect Cost $90,000 CWCB Loan Pa ment Amount, includin 10% loan reserve $6,291 Number of Shareholders 16 Number of Shares of Stock 1137 Current Assessment er Share $5 Future Assessment er Share $6.50 Annual Loan Cost per acre-foot diverted $6.3Q Avera e annual diversions: 1,000 acre-feet Credit worthiness: GMRC has no debt. Table 2 shows the Financial Ratios and indicates, with the exception of cash reserves, average to strong ability to repay with the project in place. Table 4. Financial Ratios (20-year loan) Financial Ratio Without With the ro "ect The ro "ect Operating Ratio (revenue/expense) 568% 108% weak: less than 100% (strong) (average) average: 100% - 120% stron : reater than 120% Debt Service Coverage Ratio No debt 100% (revenues-expenses)/debt service (strong) (average) weak: less than 100% average: 100% - 125% stron : reater than 125% Cash Reserves to Current Expense 1228% 34% weak: less than 50% (strong) (weak) average: 50% - 100% stron : reater than 100% Annual Cost per Ac-Ft diverted (1,000 ac-ft) $1.00 $6.72 weak: greater than $20 (strong) (strong) average: $10 - $20 stron : less than $10 As security for the loan the GMRC will pledge assessment revenues backed by assessment covenant and other Company property (Reservoirs #1 and #9) adequate to assure repayment of the loan. This security is in compliance with CWCB Loan Policy #5 (Collateral). 4