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The shares of New Cache La Poudre Irrigating Company and Cache La Poudre <br /> Reservoir Company are available immediately upon loan approval. At that time,the <br /> transfer of ownership would be executed. <br /> Loan Request <br /> The selected alternative is estimated to cost a total of$1,297,500. The project cost <br /> estimate is shown in Table 1 above. <br /> The Lower Poudre Augmentation Company is requesting a 30 year loan of 90%of the cost <br /> ($1,297,500) at the current agricultural rate of 1.70 %. The members of the Lower Poudre <br /> Augmentation Company are agricultural entities and the well water usage if for production <br /> agriculture. The remaining 10% of the cost will be born by the LPAC. <br /> Financial Plan <br /> Current Loan Ja� <br /> LPAC currently has an existing loan with the Colorado Water Conservation Board <br /> (Contract Loan Number C 150245). The loan was obtained for the purchase of the <br /> Harmony 25 Reservoir and Box Elder Shares described above. The original loan <br /> amount was $3,560,333 with a term of 30-years at a fixed interest rate of 2.50%. The <br /> annual payment is $170,104.31. The loan will be paid off in November of 2041. <br /> Current Financial Condition <br /> The LPAC is in excellent financial condition. Financial Statements for the past three <br /> years have been provided in Appendix E. <br /> Loan Repayment Sources <br /> The repayment will be made strictly from annual assessments of the well owners. <br /> The value of the water and the project on a per-acre-foot basis make the project <br /> repayment economical. Future values of the project will actually make this project an <br /> asset of growing value to the shareholders. <br /> Collateral <br /> The project sponsor proposes to use the water rights that are being purchased as the, <br /> collateral for the loan. The value of irrigation water and reservoir storage has steadily <br /> increased over the past several years. The Northern Colorado area has significant growth <br /> and a vibrant economy which makes this asset credit worthy. The water rights come from <br /> the New Cache La Poudre Irrigating Company which have a very healthy demand for <br /> shares. The value of the shares as they are pledged for collateral are in line with(or <br /> 11 <br />