C150298 Easement & ROW Agreement

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1. AGREEMENT 1. Joint Proiect—Past Work. The parties acknowledge that, prior to the date of this Agreement, they have been jointly developing the Pipeline under verbal agreements. As part of that work, each party has done and paid for several separate items. Because it is the general intent of both parties that the costs of this joint project be shared equally, to the greatest extent possible, the parties agree that within ninety(90) days of the date this Agreement is executed, they will both tally up their expenses for project work done prior to the date of this Agreement. If either side has paid more than 50% of project development costs, then the other party will reimburse a sum sufficient to balance the pre-Agreement project costs into equal shares. Generally speaking, the attorney fees paid by each party to its own attorney for advice and counsel concerning the Pipeline Project shall be paid by each individual party, and not shared. However, as an exception to this provision, both parties agree that legal fees billed by Vranesh and Raisch, LLP for the purpose of obtaining grants and loans to help finance project development and construction will be shared equally by both parties. As of the date of this Agreement, both parties formalize and confirm their agreement to develop the Pipeline Project as a joint project and to work cooperatively for the purpose of financing, developing and constructing, and operating the Pipeline Project, subject to the terms and conditions of this Agreement. 2. Project Financin . The parties have previously agreed that project financing will be obtained from a combination of grants and loans. The goal of the parties is to try to obtain sufficient grants to finance 50% of total Pipeline Project costs, and to obtain loans to cover the other 50%. The parties acknowledge that 100% loan financing may not be available for each party's portion of the loan financing, and so a portion of each party's financing may come from individual funds. A. Grant Applications. The parties have submitted a grant application from the State of Colorado's Water Supply Reserve Account. The grant application has been approved subject to certain terms and conditions. The parties agree to continue work on that grant application and meeting the conditions required for approval. In order to better comply with the grant application process, the parties agreed that FMRICO shall be designated as the grant applicant and contractor with the State of Colorado. FMRICO agreed that, if the grant application is successful and grant funds are received, FMRICO shall utilize all grant funds received for the development and construction of the Pipeline Project. B. CWCB Loan Applications. The parties have identified the loan program operated by the Colorado Water Conservation Board ("CWCB") as a favorable source of loan financing. After initial investigation, the parties learned that the CWCB loan process would be easier to utilize if FMRICO is designated as the loan applicant for the entire amount of the loan. Therefore, the parties agreed to designate FMRICO as the sole applicant for the CWCB loan for the Pipeline Project. The loan was approved on September 15, 2009, subject to certain terms and conditions. Through this Operating 2