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1. Construction Fund Program Procedures. The following items are procedures the BORROWER shall follow during the construction phase of the PROJECT. a. The BORROWER shall employ an engineer, registered in the State of Colorado, hereinafter referred to as the CONSULTANT, to prepare plans and specifications for the PROJECT. b. The agreement between the BORROWER and the CONSULTANT and the plans and specifications must be submitted to the eWCB staff for verification of compliance with the terms of this contract prior to bid opening. Any modifications to the plans and specifications must be approved in writing by the CWCB staff. c. For plans and specifications for all jurisdictional dams and reservoirs, as defined by S 37-87- 105 C.R.S. (1999), the BORROWER shall provide a letter of approval from the State Engineer's Office prior to construction. d. CWCB staff must be present at bid opening and must approve the award of the construction contract. e. The BORROWER shall contract for the construction of the work with responsible and capable firms, hereinafter referred to as CONSTRUCTION FIRMS, which CONSTRUCTION FIRMS shall be selected by the BORROWER and found acceptable by the CWCB staff before work under this contract begins. f. The BORROWER must provide a copy of the executed construction contract documents consisting of the advertisement for bid, contractor's proposal, construction contract, bid bond, performance bond, payment bond, notice of award, notice to proceed, sample change order, and sample field order. After the CWCB staff verifies that these documents comply with the terms of this contract, the BORROWER may issue the notice to proceed to the CONSTRUCTION- FIRMS. g. The BORROWER shall conduct a pre-construction conference at which time the CWCB staff shall have the opportunity to review and approve the construction schedule. h. If the eWCB staff determines that the PROJECT requires a resident inspector during construction, the BORROWER shall empioy an inspector who has been approved by the CWCB staff. i. The BORROWER shall construct the PROJECT in accordance with the approved plans and specifications. j. Upon completion of the PROJECT construction, the BORROWER shall provide as-built drawings of the PROJECT to the CWCB staff, and, if required by S 37-87-105, C.R.S. (1999), the BORROWER shall provide the same drawings to the Sta.te Engineer's Office for approval and filing. k. Upon completion of the PROJECT construction, the BORROWER shall arrange a final inspection for the CWCB staff, CONSTRUCTION FIRM, and the CONSULTANT. 2. Time For PROJECT Completion. The BORROWER recognizes that time is of the essence in the periormance of all of its obligations under this contract. Therefore, the BORROWER shall complete the PROJECT within two (2) years from the date of this contract. The time for completion of the PROJECT may be extended subject to the approval of the STATE. The BORROWER must provide, in writing, documented justification for any request for extension sixty (60) days prior to the end of the period for completion. The State will provide to the Borrower within thirty (30) days following Highland Ditch Company Page 2 of 12 Loan Contract r