2011-03-14_REVISION - M1977493 (67)

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503635 B-607 P-553 04128193 13:4-fMC00fd4 24 OF 99 Delivery Point as more particularly described in the attached Exhibit N (collectively, the "EPR Water Facilities"); provided that in lieu of conveying such easement as to Eagle Park Reservoir, Climax may convey to the Company the land underlying Eagle Park Reservoir; and Climax shall have good and market-able title to the EPR Water Facilities free and ?j clear of all liens, encumbrances, leases, contracts, byd assessments, charges or interest. Such easement to the EPR Water Facilities shall provide VA with access to construct the delivery facility from Eagle Park Reservoir to the Ten Mile Delivery Point and/or from Eagle Park Reservoir to Climax's Domestic Water Treatment Building, in the event that Climax has not begun construction of such facility by the time of the exercise or expiration of the EPR Conversion Options. For the purposes of this Agreement, no individual Climax Contingency shall have been satisfied unless and until the parties specifically agree in writing that such Contingency has been satisfied. 3.3 The VA Conversion option. Regardless of whether or not the Climax Contingencies have been satisfied, VA may exercise the VA Conversion option at any time during its term. Upon exercise of the VA Conversion Option, VA shall take Shares representing an interest in EPR Firm Annual Yield in Eagle Park Reservoir (the "Shares") subject to any Climax Contingencies that have not been satisfied. Climax shall have no liability to VA for failure to satisfy the Climax Contingencies; provided that if and when VA exercises the VA Conversion Option, Climax shall be obligated to transfer to the Company all of Climax's interests in the application for water rights in Case No. 92CW340 in and for the District court, water Division No. 5, State of Colorado and any subsequent decree entered in such case ("Case No. 92CW3400). 3.4 Additional EPR Conversion option Provisions. The following provisions shall apply to both the EPR Conversion options: (a) Unencumbered Shares. As of the exercise by either party of its respective EPR Conversion option, the Shares shall be free and clear of any security interest, lien, claim, charge, encumbrance, outstanding assessment, or other defect of title. (b) EPR operating Agreement. Within ninety (90) days of the exercise by either party of its respective EPR Conversion Option, Climax shall enter into an operating agreement with the Company in a form mutually acceptable to FUD:b09 _16- • • •