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WHEREAS,the Board previously determined that it was necessary for the District and its <br /> residents and ratepayers to acquire certain land and incur certain initial project development <br /> costs for the planned Dry Gulch Reservoir site (collectively, as further defined in the Agreement <br /> to Restructure, defined herein,the"Project"); and <br /> WHEREAS, at such time, the Board determined that the need for the Project required the <br /> Board to obtain financing for the Project; and <br /> WHEREAS, on April 15, 2008, the Board adopted a resolution approving the District <br /> entering into a loan contract with the Colorado Water Conservation Board (the "CWCB"), <br /> subject to certain parameters set forth in such resolution, for the purpose of providing for <br /> permanent financing for the Project; and <br /> WHEREAS, in furtherance thereof, the Board approved the execution and delivery of(a) <br /> a Loan Contract dated as of July 21, 2008 (including the Security Agreement and Project <br /> Summary appended thereto, the "Original Loan Contract") between the District and the CWCB <br /> and (b) a Promissory Note (the "Original Note") dated as of July 21, 2008 from the District to <br /> the CWCB, evidencing the loan (the "Original Loan") made pursuant to the Original Loan <br /> Contract; and <br /> WHEREAS, the Original Loan Contract established an irrevocable and first lien on the <br /> availability of service charge revenue and the net revenue of the System, on parity with that of <br /> the then-outstanding Parity Lien Bonds (as defined herein) issued by the District; and <br /> WHEREAS, the Original Loan Contract was amended by the District and the CWCB as <br /> of April 30, 2013 to reduce the amount available to be drawn thereunder; and <br /> WHEREAS, subsequent to such amendment, the Board determined that it may determine <br /> not to construct the Project as initially planned; and <br /> WHEREAS, in furtherance of such determination, the District, the CWCB and the San <br /> Juan Water Conservatory District entered into an Agreement to Restructure the Original Loan <br /> Contract dated as of October 27, 2015, as subsequently amended by an Amendment to <br /> Agreement to Restructure dated as of April 27, 2016 (as so amended, the "Agreement to <br /> Restructure"); and <br /> WHEREAS, the Agreement to Restructure set forth the parties' determination to <br /> restructure the Original Loan Contract by dividing the Original Loan into two separate loans: (a) <br /> "Loan A," made pursuant to an amendment to the Original Loan Contract (the "Loan A <br /> Amendment" and, together with the Original Loan Contract, as previously amended, the "Loan <br /> A Contract"), and evidenced by the Original Note, as amended by Amendment to Promissory <br /> Note (the "Loan A Note Amendment" and, together with the Original Note, the "Loan A Note"); <br /> and (b) "Loan B," made pursuant to a new Loan Contract (the "Loan B Contract"), and <br /> evidenced by a Promissory Note (the "Loan B Note"); and <br /> WHEREAS, the Board has determined and hereby determines that it is in the best interest <br /> of the District and its residents and ratepayers that the District execute and deliver the Loan A <br /> Amendment and Loan A Note Amendment and the Loan B Contract and Loan B Note; and <br /> 4848-5023-6722.3 APPENDIX E-2 <br />