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<br /> b, Convey to the Colorado mater Conservation Board, Department of
<br /> Natural Resources , State of Colorado, by warranty deed an undivided
<br /> one-half interest to the Gray Lakes Reservoirs and all water rights
<br /> appurtenant thereto, which reservoirs are situated in Sections
<br /> 34 and 25 , Township 8 North, Range 68 West of the Sixth Principal
<br /> Meridian, located in the County of Larimer, State of Colorado.
<br /> c . Permit periodic inspection of contruction by the authorized
<br /> representatives of the State during construction and permit the
<br /> State to review and approve or disapprove any contract for the.
<br /> construction of the project or the performance of work pursuant to
<br /> such contracts or subcontracts , except that this provision shall
<br /> not apply to work heretofore accomplished by the Contractor.
<br /> d. Without expense to the State , manage , operate and maintain the
<br /> project system continuously and in an efficient and economical
<br /> manner, and assume all legal and financial liability for such
<br /> management, operation and maintenance .
<br /> e. Make the services of such project available within its capacity
<br /> to all stockholders of the Contractor without discrimination as
<br /> to race , color, religion, or natural o reasonable charges ,
<br /> including assessments , taxes , or fees .,• o • e with a schedule
<br /> 41(
<br /> of such charges , whether for one t mor ` - , ,. service , as may be formally adopted by the C or thr.. ts board of
<br /> directors , and as may be modifie o time by the
<br /> Contractor. The initial rate sche b ved by the
<br /> State . Thereafter, the Contractor may k difications
<br /> to the rate schedule as the Contractor deems ry to efficiently
<br /> and economically provide for the financial requirem nts of the
<br /> system as long as the rate schedule remains reasonable and non-
<br /> discriminatory, and subject to the approval by the State .
<br /> f. Adjust its operating costs and service charges from time to
<br /> time to provide for adequate operation and maintenance , emergency
<br /> repair services, obsolescence reserves , debt service , and debt
<br /> reserves .
<br /> g. Provide the state with such periodic reports as it may require
<br /> and permit periodic inspections of its operation and accounts by
<br /> a designated representative of the State . The Colorado Water
<br /> Conservation Board, its agents , and employees , is hereby
<br /> designated as the agent of the State for the purposes of this
<br /> contract.
<br /> h. To purchase from the State all of the State ' s right , title ,
<br /> and interest in said project and any facilities thereof at a
<br /> total purchase price of Two Hundred Seventy-Six Thousand,
<br /> Eight Hundred Dollars ($276 ,800) , payable in forty annual
<br /> installments of Six Thousand, Nine Hundred, Twenty Dollars ($6 ,920)
<br /> each, which first installment shall be due and payable on July
<br /> 1 , 1979, and yearly thereafter until the entire principal sum
<br /> shall have been paid. Said annual installment payment shall be
<br /> made payable to the Colorado Water Conservation Board, payable at
<br /> the offices of said Board in Denver, Colorado.
<br /> 2 . Upon default in the payments herein set forth to be made by the
<br /> Contractor, or in the performance of any convenant or agreement
<br /> contained herein, the State , at its option, may (a) declare the entire
<br /> principal amount then outstanding immediately due and payable ; (b)
<br /> for the account of the Contractor incur and pay reasonable expenses
<br /> for repair, maintenance , and operation of the water system herein
<br /> described and such other reasonable expenses as may be necessary to
<br /> cure the cause of default; and/or (c) take possession of the system,
<br /> repair, maintain, and operate or lease it. The provisions of this
<br /> contract may be enforced by the State at its option without regard to
<br /> prior waivers by it of previous defaults by the Contractor through
<br /> judicial proceedings to require specific performance of this contract
<br /> or by such other proceedings in law or equity as may be deemed
<br /> necessary by the State to insure compliance with provisions of this
<br /> contract and the laws and regulations under which this contract is
<br /> made .
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