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THE LAKE CANAL COMPANY <br />THE LAKE CANAL RESERVOIR COMPANY <br />_77?,Ij <br />July 6, 2009 <br />The Applegate Group, Inc. <br />Attn: Ms. Sira Sartori <br />1499 West 120th Ave., Suite 200 <br />Denver, CO 80234-2728 <br />Subject: Lafarge Middle Poudre SWSP WY 2009 <br />Dear Sira: <br />(970) 352-0222 <br />The Lake Canal Reservoir Company has reserved 6.52 acre-feet of augmentation water for <br />the Middle Poudre Substitute Water Supply Plan for Lafarge. The source of the <br />augmentation water will be from a system of reservoirs owned by the Lake Canal Reservoir <br />Company. Some of the reservoirs are known as the Gray Lakes and they are senior <br />reservoirs filled from the Box Elder Creek, a tributary to the Cache La Poudre River. <br />The lease will be for the months and acre-foot amounts found in your e-mail from May 27, <br />2009 and expanded to include the accompanying return flow releases as shown in the table <br />below: <br />CU RF Total <br />0.45 0.55 Release <br />Month Acre-Feet Acre-Feet Acre-Feet <br />Apr-09 1.14 1.39 2.53 <br />May-09 1.58 1.93 3.51 <br />Jun-09 0.35 0.43 0.78 <br />Jul-09 0 0.00 0.00 <br />Aug-09 1.49 1.82 3.31 <br />Se 09 1.96 2.40 4.36 <br />6.52 7.97 14.49 <br />The releases above include 1.75% for transit losses. <br />It is your responsibility to coordinate the Middle Poudre SWSP including the required <br />releases with the water commissioner, Mr. George Varra, (970) 484-1628, and subsequently <br />provide any accounting he may request. <br />If you are in agreement, please forward the enclosed invoice for 6.52 acre-feet of <br />augmentation water to your client for payment. When payment is received the augmentation <br />water will be made available. <br />Please do not hesitate to contact the Lake Canal Reservoir Company at (970) 352-0222 or <br />Mr. Shawn Hoff at (970) 686-6568, if you need additional information. <br />33040 Railroad Avenue . P.O. Box 104 9 Lucerne, Colorado 80646