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") Promissory Note.c. Date March 1,2001 Date of Completion 1. FOR VALUE RECEIVED, the West Rhone Lateral Ditch Company ("BORROWER") promises to pay the State of Colorado Water Conservation Board ("CWCB"), the principal sum of One Hundred Thousand Dollars ($100,000) plus interest at the rate of 3:5% per annum for a term of thirty (30) years, pursuant to Loan Contract No. C150057 dated March 1,2001 ("LOAN CONTRACT"). 2. Principal and interest shall be payable in equal installments of $5,437.13, with the first payment due and payable one year from the date that the CWCB determines that the project is substantially complete, and annually thereafter until all principal, interest, and all late charges, if any, have been paid in full. All principal, interest, and late charges, if any, then remaining unpaid shall be due and payable 30 years thereafter. 3. Payments shall be made payable to the Colorado Water Conservation Board and mailed to 1313 Sherman Street, Room 721, Denver, Colorado 80203. 4. If the CWCB does not receive the annual payment within 15 calendar days of the due date, the CWCB may impose a late charge in the amount of 5% of the annual payment. 5. This Note may be prepaid in whole or in part at any time without premium or penalty. Any partial prepayment shall not postpone the due date of any subsequent payments or change the amount of such payments. 6. All payments received shall be applied first to late charges, if any, next to accrued interest and then to reduce the principal amount. 7. This Note is issued pursuant to the LOAN CONTRACT between the CWCB and the BORROWER. The LOAN CONTRACT creates security interests in favor of the CWCB to secure the prompt payment of all amounts that may become due hereunder. The security interests, evidenced by a Security Agreement, and an Assignment of Certificate of Deposit, cover certain revenues and accounts of the BORROWER. The LOAN CONTRACT, Security Agreement and the Assignment grant additional rights to theCWCB, including the right to accelerate the maturity of this Note in certain events. 8. If any annual payment is not paid when due or any default under the LOAN CONTRACT or the Security Agreement or Assignment securing this Note occurs, the CWCB may declare the entire outstanding principal balance of the Note, all accrued interest, and any outstanding late charges immediateiy due and payable, and the indebtedness shall bear interest at the rate of 7% per annum from the date of default. The CWCB shall give the BORROWER written notice of any alleged default and an opportunity to cure within thirty (30) days of receipt of such notice before the BORROWER shall be considered in default for purposes of this Promissory Note. 9. The BORROWER, any guarantor, and any other person who is now or may hereafter become primarily or secondarily liable for the payment of this Note or any portion thereof hereby agree that if this Nole or interest thereon is not paid when due or if suit is brought, then it shall pay all reasonable costs of collection, including reasonable attorney fees. In the event of any bankruptcy or similar proceedings, costs of collection shall include all costs and attorney fees incurred in connection with such proceedings, including the fees of counsel for attendance at meetings of creditors' committees or other committees. 10. This Note shall be governed in all respects by the laws of the State of Colorado. BORROWER: West Rhone Lateral Ditch Company, a Colorado onprofit corporati By ~ b/ Karen E. Fog (S E A L) ::eslr1a/d /Y/ Carol Todd, Corporate Secretary Appendix 2 to Loan Contract C150057