2014 AMENDED AND RESTATED LEASE AGREEMENT between STATE OF COLORADO, ACTING BY AND THROUGH THESTATE BOARD OF LAND COMMISSIONERS, LESSOR and RANGEVIEW METROPOLITAN DISTRICT, LESSEE and PURE CYCLE CORPORATION, SERVICE PROVIDER AND EXPORT WATER...

Exhibit 10.2

2014 AMENDED AND RESTATED LEASE AGREEMENT

between

STATE OF COLORADO, ACTING BY AND THROUGH THESTATE BOARD OF LAND COMMISSIONERS, LESSOR

and

RANGEVIEW METROPOLITAN DISTRICT, LESSEE

and

PURE CYCLE CORPORATION, SERVICE PROVIDER AND EXPORT WATER CONTRACTOR

Lease No. S-37280

TABLE OF CONTENTS

			Page
ARTICLE 1 DEFINITIONS			1
ARTICLE 2 PRELIMINARY MATTERS			4
ARTICLE 3 EFFECTIVE DATE			5
	3.1	Effective Date of This Agreement	5
	3.2	Amendment	5
	3.3	Objectives of This Agreement	5
	3.4	Rangeview	5
ARTICLE 4 LEASED PREMISES			5
	4.1	General Description of Water Subject to This Agreement	5
ARTICLE 5 GRANT OF LEASE			5
	5.1	Grant	5
	5.2	Term	7
	5.3	Effect of Expiration of the Agreement	7
	5.4	Land Board’s Legal Right to Water	7
	5.5	Sale of Land	8
	5.6	Exclusivity	8
ARTICLE 6 RIGHT TO SELL WATER			8
	6.1	Rangeview’s Conveyance of Export Water	8
	6.2	Right to Artificially Recharge	9
	6.3	Non-Export Water Available to Export	11
	6.4	Sale of Use of Water on the ▇▇▇▇▇ Range	11
	6.5	Quality of Water	12
	6.6	Termination of Export Water or Off-Site Water	12
ARTICLE 7 RENT AND ROYALTY PAYMENTS TO LAND BOARD			13
	7.1	Annual Rent	13
	7.2	Royalty for Export Water and Off-Site Water	13
	7.3	Royalties for On-site Use	14
	7.4	Recharge Royalty	15
	7.5	Payment of Royalty	15
	7.6	Reporting	15
	7.7	Royalties on Tap Fees	16
ARTICLE 8 DEVELOPMENT OF INFRASTRUCTURE AND WATER SERVICE ON THE ▇▇▇▇▇ RANGE			16
	8.1	Rangeview Shall Serve	16
	8.2	Water Fees and Rates	17
	8.3	Substitution of Facilities	17
	8.4	Right to Use Transmission Lines; Infrastructure	17
	8.5	Title to Equipment and Improvements	18
	8.6	Future Leases	18
	8.7	Rangeview District Boundaries	18
	8.8	Development of ▇▇▇▇▇ Range	18
	8.9	Reserves	18

-i-

TABLE OF CONTENTS

(continued)

			Page
	8.10	Sale or Assignment of Reservoir Rights	19
ARTICLE 9 SERVICE PROVIDER CONTRACT			19
	9.1	Service Provider for Rangeview	19
ARTICLE ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ AND SANITATION DISTRICT			20
	10.1	Terms and Revenue	20
	10.2	Title Reversion	20
ARTICLE 11 RIGHTS-OF-WAY			21
	11.1	Master Plan	21
	11.2	Fee for Right-of-Way	21
	11.3	License to Service Provider	22
ARTICLE 12 BONDING REQUIREMENTS			22
	12.1	Bond	22
	12.2	Bond of Contractors	22
ARTICLE 13 DEFAULT AND REMEDIES			22
	13.1	Events of Default	22
	13.2	Remedies	23
	13.3	No Waiver	24
	13.4	Land Board’s Right to Cure Rangeview’s Breach	24
ARTICLE 14 IMPROVEMENTS			24
	14.1	Transfer of Improvements	24
	14.2	Abandonment of Export Water Facilities	25
ARTICLE 15 GENERAL PROVISIONS			25
	15.1	Assignment by Rangeview, the Service Provider or Export Water Contractor	25
	15.2	Work Requirements	25
	15.3	Third Party Beneficiaries	26
	15.4	Notice	26
	15.5	Construction	27
	15.6	Entire Agreement	27
	15.7	Authority	27
	15.8	Copies	27
	15.9	Amendment	27
	15.10	Compliance with Law	27
	15.11	Binding Effect	28
	15.12	Severability	28
	15.13	Optimum Long-Term Revenue	28
	15.14	Further Assurance	28
	15.15	Governing Law	28
	15.16	Arbitration	28
	15.17	Litigation	29
	15.18	Duty of Good Faith and Fair Dealing	29
	15.19	Force Majeure	29
EXHIBIT INDEX			30

-ii-

2014 AMENDED AND RESTATED LEASE AGREEMENT

THIS 2014 AMENDED AND RESTATED LEASE AGREEMENT is by and among the State of Colorado, acting by and through its State Board of Land Commissioners (“Land Board”), Rangeview Metropolitan District (“Rangeview”), a quasi-municipal corporation and political subdivision of the State of Colorado, acting by and through its water activity enterprise, and Pure Cycle Corporation (“Pure Cycle”), a Colorado corporation.

NOW, THEREFORE, in consideration of the promises hereinafter stated, to be kept and performed by the Parties, their successors and assigns, the Parties agree as follows:

ARTICLE 1

Definitions

“Affiliate” shall be defined to mean any other person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified. “Control” shall mean ownership of more than 50% of the shares of stock entitled to vote for the election of directors in the case of a corporation, and more than 50% of the voting power in the case of a business entity other than a corporation.

“Agreement” shall be defined to mean this 2014 Amended and Restated Lease Agreement, Lease No. S-37280, effective as of July 10, 2014.

“Annual Rent” shall be defined as set forth in Section 7.1.

“Construction” shall be defined as set forth in Section 5.1.

“Effective Date” shall be defined as set forth in Section 3.1.

“East Cherry Creek Agreement” shall be defined to mean that certain agreement dated July 8, 1983 by and between OAR, Incorporated (Rangeview’s predecessor), and East Cherry Creek Valley Water and Sanitation District.

“ECCV” shall be defined to mean East Cherry Creek Valley Water and Sanitation District.

“Entitlement Basis” shall be defined to mean a sale or other disposition of water to a third party with the third party bearing all costs of withdrawal, treatment and delivery.

“Enterprise” shall be defined as Rangeview’s water activity enterprise established by resolution of Rangeview adopted at a public meeting of Rangeview’s board of directors on September 11, 1995, and effective as of the date of its adoption.

“Export Water” shall be defined as set forth in Section 6.1.

“Export Water Contractor” shall be defined as Pure Cycle and its successors and assigns.

“Export Water Purchaser” shall be defined to mean any person or entity who purchases Export Water other than the Export Water Contractor and a retail end user.

“Force Majeure” shall be defined as set forth Section 15.20.

“Gross Revenues” shall be defined to mean all pre-tax amounts or consideration actually received directly or indirectly by Rangeview, Service Provider, the Export Water Contractor, an Export Water Purchaser or an Off-Site Water Purchaser, as applicable, from the sale or other disposition of the applicable Water Rights, including usage fees, service charges, option rights, the right to first use, reuse, successive use, the sale of treated effluent and all other revenues, excluding taxes and refunds; provided, however that “Gross Revenues” shall not include any tap fees described in Section 7.7.

“Index” shall be defined to mean the Consumer Price Index for Urban Consumers-All items (CPI-U) published by the Bureau of Labor Statistics of the U.S. Department of Labor. In the event that the Index shall subsequently be converted to a different standard reference base or otherwise revised, the determination involved shall be made with the use of such conversion factor, formula or table for converting said Index as may be published by the Bureau of Labor Statistics, or if said Bureau shall not publish the same, then with the use of such conversion factor, formula or table as may be published by Prentice Hall, Inc., or, failing such publication, by any other nationally recognized publisher of similar statistical information. In the event that the Index shall cease to be published, then for the purposes of this Agreement, there shall be substituted such other index as the Parties shall agree upon, and if they are unable to agree, then ninety (90) days after the Index ceases to be published, such matters shall be determined by arbitration as provided in Section 15.16 of this Agreement.

“Initial Royalty Rates” shall be defined as set forth in Section 7.2(a).

“Initial Permitted Sale” shall be defined as set forth in Section 6.1.

“Land Board” is defined to mean the State of Colorado acting by and through its State Board of Land Commissioners.

“Lease” is defined to mean the aggregate of the following:

a. Lease S-37280, dated April 26, 1982 between the Land Board and OAR, Inc., whose rights and obligations were subsequently conveyed to ▇▇▇▇▇ Range Metropolitan District, now known as Rangeview;

b. Amendment to Lease S-37280, dated February 22, 1983;

c. Amendment to Lease S-37280, dated December 19, 1983;

d. Amendment to Lease S-37280, dated November 26, 1984;

e. Amendment to Lease S-37280, dated June 5 and 6, 1986;

f. Transfer Agreement dated December 8, 1986 (“Transfer Agreement”);

g. Novation Agreement dated December 7, 1988 (“Novation Agreement”); and

h. Amended and Restated Lease effective April 11, 1996 (the “A&R Lease”).

“▇▇▇▇▇ Range” shall be defined to mean the approximately 24,567.21 acres, more or less, according to U.S. Government survey, in Arapahoe County, Colorado more particularly described as follows:

Township 5 South, Range 64 West of the 6th P.M., Sections 7 through 10: all; Sections 15 through 22: all; Sections 27 through 34: all.

Township 4 South, Range 65 West of the 6th P.M., Sections 33: all; and 34, all.

Township 5 South, Range 65 West of the 6th P.M., Section 3: all; Sections 10 through 15: all, less certain surface rights granted for the Aurora Reservoir (but including the water under the Aurora Reservoir) in Section 15; Sections 22 through 27: all, less certain surface rights granted for the Aurora Reservoir (but including the water under the Aurora Reservoir) in Section 22; Sections 35 and 36: all; Section 34: north 2,183.19 feet.

Township 5 South, Range 66 West, of the 6th P.M., Section 36: all.

“Minimum Annual Water Production Payments” shall be defined as set forth in Section 7.1(b).

“Non-Export Water” shall be defined to mean the Water Rights other than (i) the Export Water and (ii) the water subject to the East Cherry Creek Agreement.

“Off-Site” shall be defined to mean outside the boundaries of the ▇▇▇▇▇ Range.

“Off-Site Water” shall be defined to mean Non-Export Water designated for use Off-Site.

“Off-Site Water Purchaser” shall be defined to mean any person or entity that purchases Off-Site Water.

“Operating Expenses” shall mean all actual maintenance and operating costs incurred by Rangeview or its Service Provider in discharging Rangeview’s obligations to provide Non-Export Water to Water Users as required by Section 8.1. Such Operating Expenses may include, for example, expenses for repairs to the infrastructure; salaries, wages and employee benefit expenses; fees for services, materials and supplies; rents, administrative and general expenses; insurance expenses; fees for legal, engineering, accounting and other consulting and technical services; and taxes and other governmental charges. Such Operating Expenses shall not include expenditures which are properly capitalized under generally accepted accounting principles, depreciation or obsolescence charges or reserves therefor, reserves for any other purpose, amortization of intangibles or other bookkeeping entries of a similar nature, interest charges and charges for the payment of principal or amortization of bonded or other indebtedness, royalties, or losses from the sale, abandonment, reclassification, re-evaluation or other disposition of capitalized assets.

“Parties” shall be defined to mean the Land Board, Rangeview, and Pure Cycle.

“Proceeding” is defined to mean the case entitled Pure Cycle Corporation and Rangeview Metropolitan District v. State of Colorado, by and through its State Board of Land Commissioners, Colorado District Court, in and for the City and County of Denver Case No. 2011 CV 8565, pursuant to which Rangeview and Pure Cycle, in its roles as Export Water Contractor and Service Provider, have brought certain claims, and the Land Board has brought certain counterclaims, arising out of or related to the A&R Lease.

“Pure Cycle” shall be defined to mean Pure Cycle Corporation, a Colorado corporation.

“Rangeview” shall be defined to mean Rangeview Metropolitan District, a State quasi-municipal corporation and political subdivision of the State of Colorado, acting directly as such or acting by and through the Enterprise.

“Realigned Reservoir C” shall be defined to mean the reservoir designated on Exhibits D and L attached hereto.

“Reserved Water” shall be defined as set forth in Section 5.1(e).

“Sale of Water” or similar phrases used herein shall mean the sale of the rights as set forth in Section 5.1 and Section 6.1.

“Service Agreement” shall be defined as set forth in Section 9.1.

“Service Provider” shall be defined to mean (a) Pure Cycle and its successors and assigns and (b) any entity, other than Rangeview, actually delivering the Non-Export Water and related services to the Water Users as permitted by Article 9.

“Settlement Agreement” shall be defined to mean the Settlement Agreement and Mutual Release dated as of July 10, 2014 among the Parties.

“Sky Ranch Property” shall be defined to mean the approximately 932 acres, more or less, in Arapahoe County, Colorado more particularly described on Exhibit M attached hereto.

“Substitute Facilities” shall be defined as set forth in Section 8.3.

“Water Interest Ratio” shall be defined as set forth in Section 8.3.

“Water Rights” shall be defined as set forth in Section 5.1.

“Water Users” shall be defined to mean surface tenants, occupants, developers, land owners and all other water users on the ▇▇▇▇▇ Range.

ARTICLE 2

Preliminary Matters

2.1 A dispute has arisen between the Parties concerning the status of the A&R Lease as evidenced in part by the claims asserted by and against the Parties in the Proceeding.

2.2 The Parties to this Agreement desire to: (1) amend and completely restate the rights and obligations of the Lease; (2) acknowledge and agree that the Lease as amended and completely restated by this Agreement is valid and enforceable; (3) eliminate uncertainty surrounding the Lease as amended and completely restated by this Agreement; and (4) resolve all issues between the Parties to this Agreement which are related to all issues which have been raised or could be raised in connection with the Proceeding.

2.3 The Parties affirm and acknowledge that Rangeview has had, and as of the Effective Date continues to have, the exclusive service rights set forth in Sections 5.6, 6.4 and 8.1 below.

ARTICLE 3

Effective Date

3.1 Effective Date of This Agreement. This Agreement shall be binding on the date it is fully executed and delivered by the Parties subject only to, as a condition subsequent, entry of the final non-appealable order of the Denver District Court in the Proceeding approving this Agreement and the related Settlement Agreement. The date of the final non-appealable order of the Denver District Court shall be deemed the Effective Date of this Agreement. The Parties agree to cooperate and to use their best efforts to obtain prompt entry of a final non-appealable order.

3.2 Amendment. This Agreement amends, restates in its entirety, and supersedes in all respects the Lease, and from and after the Effective Date, this Agreement, including the Exhibits hereto and the Settlement Agreement, shall control and define the rights and obligations of the Parties with respect to the subject matter of this Agreement.

3.3 Objectives of This Agreement. The Parties acknowledge that it is in their best interests to arrange for water development on the ▇▇▇▇▇ Range to be pursued in a manner which encourages efficient and economical use of the water resources which are the subject of this Agreement and encourages surface development on the ▇▇▇▇▇ Range. Rangeview has the objective of acquiring an adequate water supply to provide water delivery to Water Users pursuant to this Agreement and, subject to the terms of this Agreement, to apply the Export Water and Non-Export Water to uses which create revenue and thereby provides additional royalty payments to the Land Board. In order to achieve this objective, the Parties acknowledge that Rangeview’s first priority for utilization of its available revenues will be the fulfillment of its commitment to provide water service exclusively to Water Users. The Land Board contemplates that it may lease, sell, or otherwise dispose of portions of the surface of the ▇▇▇▇▇ Range at some undetermined point in the future and anticipates that the availability and provision of water service to the ▇▇▇▇▇ Range pursuant to this Agreement may promote development on the ▇▇▇▇▇ Range.

3.4 Rangeview. The Parties acknowledge that the Enterprise caused Rangeview, acting directly and not through the Enterprise, to execute and deliver a guaranty of this Agreement in the form attached hereto as Exhibit I.

ARTICLE 4

Leased Premises

4.1 General Description of Water Subject to This Agreement. Except as otherwise reserved to the Land Board in Section 5.1 below, this Agreement shall encompass the use of all of the waters on and under the surface of the ▇▇▇▇▇ Range.

ARTICLE 5

Grant of Lease

5.1 Grant. Subject to the terms, conditions and limitations set forth in this Agreement, the Land Board hereby leases to Rangeview the right and privilege during the term of this Agreement to divert and put to beneficial use all water on and under the surface of the ▇▇▇▇▇ Range, including all rights to the first use, reuse, successive use and disposition of such water, together with the right to use as much of the surface and underground portions of the ▇▇▇▇▇ Range as provided in Article 11 of this Agreement as may be reasonably required in the exercise of the rights granted by this Agreement, including, in accordance with commercially reasonable and prudent water provider practice in Colorado, the right to drill and build ▇▇▇▇▇, construct buildings (except office and other such buildings not directly necessary for the extraction and transportation of water), make excavations, stockpiles, dumps, drains, roads, power lines, pipelines, and other improvements (all such activity hereinafter being referred to as “Construction”), but only as may be reasonably necessary for the development and delivery of the water pursuant to this Agreement. The foregoing items exclusive of the reservations set forth below are collectively referred to as the “Water Rights.”

Reserving, however, to the Land Board:

(a) Except as are herein specifically granted, the right to exercise all rights and privileges of every type and nature which are incident to the ownership of the ▇▇▇▇▇ Range, or any part thereof, at any time, for any purpose, including, without limitation, the right to explore, prospect for and extract oil and gas and other minerals, including sand and gravel, on or under said land, in a manner not inconsistent with the full exercise by Rangeview of the rights and privileges herein granted;

(b) The right at any time to go upon those portions of the ▇▇▇▇▇ Range not exclusively utilized by Rangeview and the right at all reasonable times upon five (5) days’ written notice during the term of this Agreement to go upon those portions of the ▇▇▇▇▇ Range exclusively utilized by Rangeview and every part thereof for the purpose of inspecting same, including metering, measuring and other similar devices, and, in accordance with Section 7.6, to inspect the books of accounts and records of water development and use therein, and of ascertaining whether or not Rangeview, and those entities holding under and buying from or contracting with Rangeview, are carrying out the terms, covenants and agreements of this Agreement;

(c) All interests in the Water Rights and all interests in the ▇▇▇▇▇ Range previously granted by the Land Board identified in Exhibit A;

(d) The Land Board’s recharge rights set forth in 6.2(b);

(e) A total of 2,500 acre-feet annually (“Reserved Water”), as more specifically identified on Exhibit J attached hereto, shall be reserved for the Land Board’s or its lessees’ use for any purpose other than real estate development, mining and oil-and-gas development.

(f) The right to require Rangeview to move the surface water diversion points for Coal Creek and Box Elder to locations on the ▇▇▇▇▇ Range chosen by the Land Board, with the objective of moving such surface water diversion points to a technically feasible location within a 2,500 foot range of the north border of the ▇▇▇▇▇ Range. The Land Board shall consider alternatives that adequately protect the riparian areas, but is under no obligation to accept such alternatives. In selecting such surface water diversion points, consistent with the foregoing, the Land Board shall reasonably consult in good faith with Rangeview, including each Party reasonably considering the engineer report created by the other Party, if necessary.

(g) The Land Board may revoke and withdraw its grant of groundwater Water Rights under this Section 5.1 with respect to Water Rights on or under 1280 acres to be determined by the Land Board, without additional compensation to Rangeview. The Land Board may also revoke and withdraw groundwater Water Rights on or under up to 2,560 additional acres, to be determined by the Land Board, from its grant of Water Rights under this Section 5.1 in exchange for equitable groundwater resources or, if equitable groundwater resources are not available, reasonable cash compensation. Whether water to be exchanged constitutes equitable groundwater resources will be determined based on the quantity of such water available by aquifer, the legal type and permitted use of such water, the priority date of such water, the saturated thickness of aquifers, permeability, transmissivity, and other geologic conditions compared to the Water Rights withdrawn, as well as economic considerations such as changes in the number of ▇▇▇▇▇ required, pumping costs, pipeline locations, and treatment costs and other economic considerations which commercially reasonable and prudent water providers would incur. The Land Board will pay reasonable infrastructure relocation costs incurred by Rangeview or the Export Water Contractor, as applicable, if necessary, resulting from any removal, relocation or withdrawal of Water Rights pursuant to this Section 5.1(h).

5.2 Term. The term of the Lease commenced at 12:00 noon on May 1, 1982, and, as amended by this Agreement, shall expire at 12:00 noon on May 1, 2081 unless terminated earlier in accordance with the terms of this Agreement or otherwise extended.

5.3 Effect of Expiration of the Agreement.

(a) Upon expiration, or earlier termination of the term of this Agreement, the right to the use of the Non-Export Water shall automatically and without further act of the Parties or anyone else revert to the Land Board. To the extent Non-Export Water is actually being delivered to provide water service to Water Users or users of Non-Export Water Off-Site, the Land Board agrees that such water will continue to be made available to (i) Water Users under commercially reasonable agreements to be negotiated at the time of such expiration or termination, which agreements shall include adequate revenue for the Land Board, and (ii) users of Non-Export Water Off-Site in accordance with the contracts described in Section 5.3(b) below. In the event no agreement is reached, then the terms of such agreements shall be determined by arbitration pursuant to Section 15.16.

(b) Rangeview, the Service Provider and the Export Water Contractor each agree not to enter into agreements or contracts related to the Off-Site Water whose terms shall disproportionately allocate economic benefits, revenues, obligations, rates and terms (including, without limitation, accounting for inflation and anticipated changes in the demand for water services) as between Rangeview, the Service Provider and the Export Water Contractor during the term of the Agreement and the Land Board after the Agreement has expired or terminated. Each of Rangeview, the Service Provider and the Export Water Contractor agrees to provide the Land Board written notice twenty-one (21) days in advance of Rangeview, the Service Provider or the Export Water Contractor’s entry into any agreement or contract related to the Off-Site Water. Such notice shall include the relevant terms and conditions of the applicable agreement or contract. The failure of the Land Board to object following the receipt of such notice shall not be deemed to be an acceptance by the Land Board of the terms and conditions of the applicable agreement or contract or a waiver of the Land Board’s rights under this Section 5.3(b), provided, however, that the foregoing sentence shall not create a consent right for the Land Board. Rangeview shall be responsible for all augmentation obligations, including any lagged depletions and any other augmentation after the expiration or termination of the Agreement for any water produced by Rangeview.

5.4 Land Board’s Legal Right to Water. The Land Board hereby warrants and represents that, except as provided in Exhibit A, it has all right, title and interest in the Water Rights granted to Rangeview and it has not granted such rights to any other person or entity. Rangeview agrees to pursue diligently (1) the adjudication of all of the Water Rights, and (2) the development of the Water Rights as necessary to provide water service to Water Users in a commercially reasonable time and manner and in accordance with prudent water provider practice in Colorado, without cost or legal expense to the Land Board. The Land Board shall reasonably cooperate and render assistance with respect to all permits, applications, filings and documents related to Rangeview’s activity in adjudicating all of the Water Rights and shall be provided courtesy copies of such papers five (5) days before they are filed. It is further agreed by the Parties hereto that all permits, applications, filings, documents and decrees in connection with establishing such Water Rights shall bear the name of, and be made in the name of Land Board and, if necessary, Rangeview, as lessee. Legal title to the Water Rights shall be held in the name of the Land Board except to the extent reasonably necessary to include Rangeview, as lessee, in water decrees, without cost to the Land Board, and any water rights adjudicated on and under the ▇▇▇▇▇ Range shall automatically become Water Rights under this Agreement. Nothing in this Agreement shall be deemed to prohibit Rangeview from adjudicating in its sole name and for its sole benefit any other Off-Site water rights not subject to this Agreement.

Unless expressly agreed to by the Land Board in writing and in its sole discretion, the Water Rights, the water system to be constructed, and the rights-of-way on and aquifers under the ▇▇▇▇▇ Range required to deliver both Export and Non-Export Water, and any other rights granted hereunder, shall not be used for any business or-other purpose except to provide water service consistent with this Agreement and the water decrees by which such Water Rights have been or may be adjudicated.

5.5 Sale of Land. C.R.S. 36-1-118(4) provides that the Land Board may, in its discretion, offer for sale any land leased at any time during the term of any lease as though said lease had not been executed, or it may withdraw such land from sale during the full term of the lease. The Land Board affirms that the right to develop, divert, convey and use the Water Rights and the interest in the surface of the ▇▇▇▇▇ Range conferred by Article 11 of this Agreement shall be withdrawn from sale until this Agreement terminates in accordance with the provisions hereof.

5.6 Exclusivity.

(a) The Land Board affirms that, consistent with the obligations of Rangeview and its Service Provider to provide service to all Water Users pursuant to Sections 6.4 and 8.1 hereof, the Land Board shall require all Water Users to obtain water service exclusively from Rangeview during the term of this Agreement, except with regard to the waivers set forth on Exhibit K attached hereto and the Reserved Water.

(b) Accordingly, the Land Board agrees that if it shall lease or contract for exchanges, sales or other dispositions pertaining to any interest in or beneath the surface of the ▇▇▇▇▇ Range during the term of this Agreement, the Land Board shall include a covenant in any such transfer agreements, and in any deed related thereto, requiring the acquiror of such ▇▇▇▇▇ Range property and any subsequent transferee of such property to obtain all water service required with respect to such property exclusively from Rangeview during the term and subject to the terms of this Agreement.

(c) Each of Rangeview, the Service Provider and the Export Water Contractor covenant that, notwithstanding the grant of exclusivity with regard to providing service to Water Users as set forth in Section 5.6(a), Section 6.4 and Section 8.1 hereof, such parties shall not bring any claims, cross claims, counterclaims, controversies, disputes, liabilities, obligations, demands, damages, debts, liens, actions or causes of action against (i) the Land Board, with regard to the failure of any past, present or future Water User to receive any service, including without limitation the Non-Export Water, from Rangeview, the Service Provider or the Export Water Contractor on an exclusive basis, and (ii) any of the past or present Water Users, with regard to such Water User’s past, present or future election to receive any water service from any person or entity other than Rangeview, the Service Provider or the Export Water Contractor, to the extent relating to any past or present leases. For the sake of clarity, the foregoing sentence shall not apply to any failure by the Land Board to comply with its obligations under Section 5.6(b).

ARTICLE 6

Right to Sell Water

6.1 Rangeview’s Conveyance of Export Water.

(a) As of April 11, 1996, and subject only to the terms of this Agreement, Rangeview sold the right to divert and sell outside the ▇▇▇▇▇ Range the use of up to a total gross volume of 1,165,000 acre feet of the non-tributary and not non-tributary water included in the Water Rights (“Export Water”) pursuant to an agreement in the form attached hereto as Exhibit C (the “Initial Permitted Sale”). The Export Water may be withdrawn only to the extent permitted by the water decrees by which such water was adjudicated as outlined on Exhibit J, as such decrees may be amended from time to time, and may not be withdrawn in quantities or in any other manner that would adversely affect the delivery of Non-Export Water to Water Users or Off-Site users. Notwithstanding the expiration or early termination of this Agreement, such right to divert, sell and use the total gross volume of 1,165,000 acre feet of Export Water shall be absolute and irrevocable subject to the provisions of Section 6.6. The diversion and use of the Export Water shall be in accordance with the terms of the water decrees by which such water was adjudicated, as such decrees may be amended, from time to time and will include the right to sell all use, reuse, and successive uses of the Export Water. Upon the sale or other disposition of all or any portion of the Export Water following the Initial Permitted Sale, Rangeview shall cause to be paid and the Land Board shall receive the royalty described in Section 7.2 below. The Land Board will have no approval rights as to any sale or other disposition of the use of the Export Water subsequent to the Initial Permitted Sale, except that Rangeview shall provide to the Land Board written notice of and access to the contemplated sale documents twenty-one (21) days in advance of such sale or other disposition pursuant to Rangeview’s rights as set forth in Section 12.1 of Exhibit C. Contracts for sales of the use of Export Water shall provide for the substitution of facilities and oversizing of pipes as provided in Sections 8.3 and 8.4 below and that the capital costs for the Export Water delivery system and oversizing of pipes will not be charged, directly or indirectly, to the Land Board, Rangeview, or Water Users (except to the extent such facilities are substituted for on-site service, in which case Water Users will indirectly bear costs through rates and charges and Rangeview may incur administrative and maintenance expenses with respect thereto). In addition, Rangeview shall cause such contracts to provide for the payment of royalties as otherwise provided in this Agreement.

(b) Rangeview is in the process of adjudicating certain tributary waters on the ▇▇▇▇▇ Range. To the extent Rangeview is successful in completing adjudication of such rights, and to the extent water is available pursuant to such adjudication, the Export Water Contractor shall have the right at any time during the first five (5) years following the adjudication to substitute up to 1,650 acre feet per year of non-tributary water which constitutes a portion of the Export Water as defined in this Section 6.1 for an absolute and irrevocable decree for up to 1,650 acre feet of tributary water. If the Export Water Contractor exercises the foregoing right, the Export Water Contractor shall reconvey a total gross volume of 165,000 acre feet of non-tributary water and not non-tributary water which constitutes the Export Water to the Land Board, as lessor, and Rangeview, as lessee, to become Non-Export Water subject to this Agreement and the Export Water Contractor shall enter into an agreement with Rangeview which provides that in years when less than a total of 3,300 acre feet per year of tributary water on the ▇▇▇▇▇ Range is physically available, the Export Water Contractor shall only utilize up to fifty percent (50%) of the available tributary water unless the remaining available tributary water is not being utilized by Rangeview, its Service Provider, or the Land Board, as applicable, and Rangeview, its Service Provider, or the Land Board, if applicable, agrees that it does not plan to utilize such water during the year, in which case the Export Water Contractor may utilize the available tributary water which Rangeview, its Service Provider, or the Land Board does not plan to use up to a maximum of 1,650 acre feet. In no case shall Non-Export Water be used to augment the Export Water Contractor’s tributary water hereunder.

For example, if in a year there are only 2,400 acre feet of tributary water available, the Export Water Contractor could only utilize 1,200 acre feet unless Rangeview, its Service Provider, or the Land Board, if applicable, does not plan to use some portion of the remaining 1,200 acre feet, in which case the Export Water Contractor could use the unused tributary water up to a maximum of 450 acre feet for a combined total of 1,650 acre feet.

6.2 Right to Artificially Recharge.

(a) Right to Recharge of Rangeview, the Service Provider, and the Export Water Contractor. Rangeview, the Service Provider, and the Export Water Contractor shall have the right to artificially recharge and to store the recharged water in the aquifers from which such Water Rights are withdrawn and to withdraw such artificially recharged and stored water. Rangeview, the Service Provider and the Export Water Contractor shall also have the right to store additionally acquired water in reservoirs on the surface of the ▇▇▇▇▇ Range in a commercially reasonable manner consistent with prudent water provider practice in Colorado and subject to the requirements set forth herein.

(i) If Rangeview, the Service Provider or the Export Water Contractor desires to construct a surface reservoir, such entity must notify the other entities of such intention and give them the opportunity to participate in the project. Any such reservoir must be compatible with the existing and reasonably projected development of the surrounding land and must generally be consistent with Realigned Reservoir C as set forth on Exhibit L; provided, however that in connection with the construction of Realigned Reservoir C, each Party may request reasonable alterations to Exhibit L and the other Parties shall reasonably accommodate any such requested reasonable alterations. Any disputes over whether the proposed reservoir will be compatible with the development of the surrounding land or consistent with Realigned Reservoir C (including any requested alterations thereto) shall be resolved by arbitration pursuant to Section 15.16 of this Agreement. The burden of proof in such arbitration shall be on the entity desiring to construct the reservoir. If a reservoir is constructed, the entity or entities constructing such reservoir shall permit reasonable access to the reservoir, if requested by surrounding land owners, municipalities, parks and recreation districts or similar entities, provided that the access requested does not interfere with or render more costly the planned use and operation of the reservoir and provided that it shall not be the responsibility of Rangeview, the Service Provider or the Export Water Contractor to provide amenities or safety features to accommodate needs of such third persons unrelated to the water service function of the reservoir.

(ii) Subject to the provisions of subsection (i) above.

(1) Notwithstanding Article 11, if Rangeview, its Service Provider or the Export Water Contractor plans to construct a reservoir, the Land Board shall grant to Rangeview, the Service Provider or the Export Water Contractor, as applicable, a perpetual right-of-way on the land for such reservoir, which does not expire unless the reservoir is abandoned in accordance with Section 14.2. This right-of-way shall be granted in exchange for payment of the then fair market value for the land except as otherwise provided in Section 11.2 with respect to Realigned Reservoir C.

(2) If the reservoir is planned to be jointly constructed by Rangeview and/or its Service Provider and the Export Water Contractor, then the fees will be based on the proportionate part of the reservoir to be used by Rangeview or its Service Provider on the one hand, and the Export Water Contractor on the other.

(iii) Any artificial recharge must be done in accordance with all applicable laws, rules, and regulations in effect at the time of such artificial recharge, and notwithstanding such compliance, shall not interfere with or render more burdensome or costly delivery of the Non-Export Water to Water Users.

(iv) Each of Rangeview, the Service Provider and the Export Water Contractor (but excluding the end user, an Off-Site Water Purchaser which is not an Affiliate of the Service Provider, and an Export Water Purchaser which is not an Affiliate of the Export Water Contractor) shall be jointly and severally liable for all damages, including without limitation, environmental or water quality damages, if any, incurred by the Land Board or the Water Users caused by Rangeview, the Service Provider or the Export Water Contractor arising out of the artificial recharge, storage, or withdrawal of such artificially recharged water.

(v) Rangeview shall cause all contracts for the sale or other disposition of the Export Water or Off-Site Water to provide that the Land Board shall be paid the royalty required by Section 7.4 at the time the recharged water is withdrawn. The royalty shall be payable by the entity withdrawing such water and the Land Board shall have the right to enforce such payment requirement, including the rights as provided in Section 6.6. If there is a dispute as to the royalty attributable to such recharged water when it is withdrawn, the royalty shall be resolved by arbitration pursuant to Section 15.16 of this Agreement.

(vi) The right to recharge Export Water is not alienable from the Export Water and must be sold in conjunction therewith. Subject to Section 15.19, the right to recharge sold with the Export Water shall be deemed abandoned when the Export Water Contractor withdraws the entire portion of the Export Water purchased plus the entire amount of water recharged by the Export Water Contractor or when the Export Water Contractor has failed to recharge any portion of the aquifers for a period of ten (10) years. In the event of a dispute in the determination of the abandonment of the right to recharge, the matter shall be determined by arbitration pursuant to Section 15.16 of this Agreement.

(vii) Rangeview and the Service Provider’s right to recharge Off-Site Water is not alienable from the Off-Site Water and must be sold or otherwise disposed of in conjunction therewith.

(viii) Rangeview shall cause the Service Provider and the Export Water Contractor to comply with this Section 6.2(a) in conducting any recharge activities permitted above.

(b) Land Board’s Right to Recharge. The Land Board shall have the right to artificially recharge, store and withdraw water in the aquifers beneath the ▇▇▇▇▇ Range in accordance with all applicable laws, rules and regulations in effect at the time of such artificial recharge; provided, however, that notwithstanding such compliance, the Land Board shall not interfere with or render more burdensome or costly the storage of or delivery of or recharge of water by Rangeview, the Service Provider or the Export Water Contractor. Further, the Land Board shall be liable for damages, including without limitation, environmental or water quality damages, if any, incurred by Rangeview, the Service Provider, the Export Water Contractor or the Water Users caused by such artificial recharge, storage or withdrawal by the Land Board.

6.3 Non-Export Water Available to Export. Subject to the provisions of this Agreement, Rangeview shall have the right to lease and use the Non-Export Water for use Off-Site. Rangeview shall pay to the Land Board forty-five percent (45%) of Gross Revenues, if any, for the disposal of untreated effluent, sewage, or sewerage Off-Site, within thirty (30) days after receipt. If there is a dispute as to such payment, the matter shall be resolved by arbitration pursuant to Section 15.16 of this Agreement. The Land Board shall be provided twenty-one (21) days’ advance written notice and access to contemplated contracts for the disposal of effluent, sewage, and sewerage Off-Site.

6.4 Sale of Use of Water on the ▇▇▇▇▇ Range. Subject to the provisions of this Agreement, Rangeview shall have (a) the exclusive right to provide water service to all current and future Water Users on the ▇▇▇▇▇ Range, except with regard to the waivers set forth on Exhibit K attached hereto and the Reserved Water, with respect to each of which Rangeview explicitly waives any exclusivity rights, and subject to the conditions set forth in Section 8.1, and (b) the duty to provide water service to all Water Users. Reuse and successive use of Non-Export Water, if any, shall be done in a commercially reasonable manner consistent with prudent water provider practice in Colorado.

Rangeview agrees that if it acquires any additional water to provide water service to Water Users, it shall, consistent with prudent water provider practices in Colorado, use such water to provide water service to Water Users without additional cost to the Land Board. Any additional water shall not be subject to the terms of this Agreement except (x) to the extent that such additional water is stored in aquifers beneath the surface of the ▇▇▇▇▇ Range or in reservoirs on the surface of the ▇▇▇▇▇ Range, in which case, such water shall thereafter be subject to the royalty set forth in Section 7.4 and (y) to the extent such additional water may remain subject to the rates and charges in Section 8.2 as described below. In the event that Rangeview cannot reasonably provide water service to Water Users at rates and charges in accordance with Section 8.2, Rangeview may notify the Land Board that an increase in the rates and charges applicable to such water service is required to cover the cost of acquiring the additional water, in which case the Land Board shall have the option of (i) permitting Rangeview to charge such increased rates or (ii) serving any Water Users requesting service after the Non-Export Water is committed. If Rangeview does not acquire additional water for Water Users, then Rangeview shall continue to provide Non-Export Water to Water Users who are issued taps prior to the time when the available Non-Export Water was committed pursuant to such taps.

Rangeview shall not issue taps based on unused cumulative rights under the decrees for the Non-Export Water. The phrase “unused cumulative rights under the decrees” means the amount of water that could otherwise have been legally withdrawn pursuant to the Statewide Non-Tributary Ground Water Rules, 2 C.C.R. 402-7, Rule 8A., over and above the allowed average annual amount of withdrawal permitted under the decrees.

The Land Board may utilize (1) the Reserved Water to the extent permitted under Section 5.1(e) or (2) the Reserved Water or any other water sources it may have or acquire for service on the ▇▇▇▇▇ Range in accordance with (A) this Section 6.4 to service Water Users requesting service after the available Non-Export Water has been committed and (B) Section 8.1 to service Water Users requesting service in the event that Rangeview and Service Provider are unable to provide plans and projections reasonably evidencing that such Parties are able to perform their obligations to provide water to future Water Users within a reasonable time frame. In accordance with (X) this Section 6.4 to service Water Users requesting service after the available Non-Export Water has been committed and (Y) Section 8.1 to service Water Users requesting service in the event that Rangeview and Service Provider are unable to provide plans and projections reasonably evidencing that such Parties are able to perform their obligations to provide water to future Water Users within a reasonable time frame, the Land Board shall have the right to jointly use and expand the facilities constructed by Rangeview or its Service Provider to provide water service to Water Users to the same extent Rangeview would have used and expanded such facilities consistent with prudent water provider practices in Colorado if it had acquired additional water to service such Water Users.

6.5 [Reserved].

6.6 Termination of Export Water or Off-Site Water. In the event the Export Water Contractor fails to pay the royalties required by this Agreement or an Off-Site Water Purchaser fails to pay any fees with respect to its purchase of Off-Site Water within ten (10) business days after the applicable due date, or takes or fails to take action which would cause material harm to the Water Rights or the aquifers or the surface of the ▇▇▇▇▇ Range then owned by the Land Board and such action or failure is not cured within thirty (30) days after written notice has been given by the Land Board or Rangeview specifically setting forth the nature of the problem, or if more than thirty (30) days is reasonably required to cure such matter complained of, if the Export Water Contractor or Off-Site Water Purchaser, as applicable, shall fail to commence to correct the same within said thirty (30) day period and shall thereafter fail to prosecute the same to completion with reasonable diligence, or commits a fraud in the performance (as opposed to the inducement) of this Agreement, as may be determined in a final non-appealable order of a court of competent jurisdiction, the Land Board or Rangeview may elect to terminate the rights to the portion of the Export Water or Off-Site Water which has not been conveyed or is not otherwise subject to a good faith, binding agreement to be conveyed to an Export Water Purchaser or Off-Site Water Purchaser and pursue such other remedies as may be provided by law. Rangeview, at its option, without prejudice to any other remedies it may have, may cure any of the foregoing defaults in order to protect its rights under this Agreement without waiting for the thirty (30) day period to run and seek reimbursement from the Export Water Contractor or Off-Site Water Purchaser, as applicable, for any costs and damages associated therewith.

ARTICLE 7

Rent and Royalty Payments to Land Board

7.1 Annual Rent.

(a) Rangeview shall pay annual rent (“Annual Rent”) in the amount of Five Thousand Dollars ($5,000.00) to the Land Board on or before May 1 of each year until this Agreement expires or otherwise terminates. The Annual Rent shall be increased every five (5) years proportionally to the five (5) year increase, in the Index. In no case shall the annual rent be reduced.

(b) On or before May 1 of each year, beginning with May 1, 2015, until this Agreement expires or otherwise terminates, Rangeview, or its Service Provider shall pay the Land Board $10 per acre-foot of Non-Export Water designated for use Off-Site (collectively, the “Minimum Annual Water Production Payments”). The Parties intend that the Non-Export Water designated for use Off-Site will consist of all Water Rights less the Export Water, the water reserved to ECCV and the water reserved to the Land Board, and agree that it will be as more specifically identified on Exhibit J attached hereto. The Minimum Annual Water Production Payments shall serve as prepaid royalties against future production and shall be forfeited to the Land Board if no royalties are paid by Rangeview or its Service Provider to the Land Board for the sale or other disposition of the Export Water or Non-Export Water in excess of the aggregate amount of the Minimum Annual Water Production Payments prior to the expiration or termination of the Agreement.

7.2 Royalty for Export Water and Off-Site Water.

(a) Royalty Rates for Public Versus Private Use of Export Water and Off-Site Water. A sum equal to ten percent (10%) of Gross Revenues shall be paid to the Land Board as a royalty in the case of a sale or other disposition of Export Water or Off-Site Water to a Title ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or other similar municipal or public entity, and a sum equal to twelve percent (12%) of the Gross Revenues shall be paid to the Land Board as a royalty in the case of a sale or other disposition of Export Water or Off-Site Water to all others. These royalty rates shall be referred to as the “Initial Royalty Rates.”

(b) Application of Initial Royalty Rates. In addition to the Annual Rent, Rangeview shall pay or cause the Export Water Contractor, Export Water Purchaser or Off-Site Water Purchaser, as applicable, to pay the Initial Royalty Rates (subject to adjustment as provided in Section 7.2(c)) on the sale or other disposition of the Export Water or Off-Site Water.

(i) If the Export Water is sold or disposed of by the Export Water Contractor on an Entitlement Basis to a public entity for an amount in excess of Forty-Five Million Dollars ($45,000,000) in Gross Revenues, the Initial Royalty Rate for such Export Water shall be increased for Gross Revenues received in excess of $45,000,000 as follows:

Gross Revenue		Royalty Rate

0 - $45,000,000		10%
$45,000,000 - $60,000,000		20%
$60,000,000 - $75,000,000		30%
$75,000,000 - $90,000,000		40%
Over $90,000,000		50%

As an example, if the Export Water Contractor receives One Hundred Million Dollars ($100,000,000) in Gross Revenues from sales of the Export Water on an Entitlement Basis to a public entity, the Land Board will receive a royalty as follows:

Gross Revenue		Royalty

the first $45,000,000		$4,500,000
the next $15,000,000		$3,000,000
the next $15,000,000		$4,500,000
the next $15,000,000		$6,000,000
the next $10,000,000		$5,000,000

(ii) If the Export Water is sold by or disposed of by the Export Water Contractor on an Entitlement Basis for a private use for an amount in excess of Forty-Five Million Dollars ($45,000,000), the Initial Royalty Rate shall be increased for the Export Water Contractor’s Gross Revenues in excess of Forty-Five Million Dollars ($45,000,000) as follows:

Gross Revenue		Royalty Rate

0 - $45,000,000		12%
$45,000,000 - $60,000,000		24%
$60,000,000 - $75,000,000		36%
$75,000,000 - $90,000,000		48%
Over $90,000,000		50%

(d) Subsequent to the anniversary date of this Agreement in the year 2081, any ongoing Gross Revenues from the sale of Export Water shall belong to and be paid to the Land Board. Following the anniversary date of this Agreement in the year 2081, to the extent Export Water is actually being delivered to provide water service to customers, the Land Board shall continue to provide service to such customers in accordance with the existing service contracts for such customers, provided Rangeview, the Service Provider and the Export Water Contractor have, with respect to the contracts for Export Water, complied with the terms set forth in Section 5.3(b) for contracts related to Off-Site Water, as though the Export Water were Off-Site Water.

7.3 Royalties for On-site Use.

(a) Initial Royalty. For sales or other dispositions of Non-Export Water for use on the ▇▇▇▇▇ Range, Rangeview will pay to the Land Board a royalty of twelve percent (12%) of the Gross Revenues from the sale or other disposition of the Non-Export Water (including any reuse or successive use of treated effluent) to Water Users.

(b) Royalty at Build-Out. At such time as metered production in any calendar year of Non-Export Water reaches 13,000 acre feet (including any re-use of water), or, alternatively, at such time as a total of 10,000 surface acres on the ▇▇▇▇▇ Range has been (i) rezoned to a use other than agricultural, (ii) finally platted, and (iii) water tap agreements have been entered into with respect to all improvements to be constructed on such acreage, then the Land Board may elect to receive, at its option, in lieu of the royalty provided in Section 7.3(a), an amount equal to fifty percent (50%) of the collective net profits derived by Rangeview and the Service Provider from the sale of Non-Export water to Water Users. Net Profits shall be defined as the Gross Revenues received from water users less (i) the currently amortized portion of applicable capital costs (assuming for purposes of this calculation that such costs are to be amortized over the estimated useful lives of the assets involved) incurred with respect to the Non-Export Water delivery system; and (ii) all Operating Expenses whether incurred by Rangeview or its Service Provider.

7.4 Recharge Royalty. If additional water acquired by the Export Water Contractor, Rangeview or its Service Provider is stored pursuant to Section 6.2(a) in surface reservoirs or in aquifers beneath the surface of the ▇▇▇▇▇ Range, such entity shall pay or cause to be paid to the Land Board a royalty equal to ten percent (10%) (for sales or dispositions to public entities) or twelve percent (12%) (for sales or dispositions to all others) of the Gross Revenues for such stored water sold or disposed of by the Export Water Contractor, Rangeview or its Service Provider, respectively, at the time of the sale or other disposition of such stored or recharged water (regardless of whether such sale or other disposition is to a retail purchaser or to Water Users).

7.5 Payment of Royalty. Payment of any royalty payable pursuant to this Agreement shall be deemed earned in proportionate part as Gross Revenues derived from the subject transaction are received. In the case of an installment sale, the royalty shall be deemed earned upon receipt of each installment payment. The royalty on Export Water or Off-Site Water sold shall be deemed earned as actual payments are made by the purchaser of the Export Water or Off-Site Water, as applicable. Royalties earned in any calendar year quarter shall be paid to the Land Board within thirty (30) days after the end of the quarter in which earned. Unpaid royalties shall accrue interest at the rate of two percent (2%) per month from the date due.

7.6 Reporting.

(a) Rangeview shall report to the Land Board the quantity of Water Rights (including any recharged or stored water pursuant to Section 6.2(a)) delivered, specifying the amounts of Export Water and Non-Export Water delivered and the amounts of such Export Water and Non-Export Water removed from each aquifer under the ▇▇▇▇▇ Range in accordance with Exhibit J, the exact amount of Gross Revenues or gross tap fee revenues relating to the sale or other disposition of Water Rights and a calculation of the royalties paid or payable to the Land Board as result thereof, and the entity to whom the Water Rights were delivered. The report shall be due within thirty (30) days after the end of each calendar year, until such time as production of Export and/or Non-Export Water reaches 500 acre feet in a calendar year, and thereafter on or before the thirtieth (30th) day following the end of each calendar quarter during the term of this Agreement. The Land Board shall deliver a report to Rangeview specifying the quantity of Water Rights removed by the Land Board from each aquifer under the ▇▇▇▇▇ Range, and such report shall be due within thirty (30) days after the end of each calendar year.

(b) Rangeview shall, or shall cause its Service Provider and/or the Export Water Contractor to, prepare and keep full, complete, and proper books, records and accounts of all Water Rights (including any recharged or stored water pursuant to Section 6.2(a)) sales or dispositions and shall document such transactions as may be required by law. Said books, records, and accounts of Rangeview, its Service Provider, and/or the Export Water Contractor shall be open at all reasonable times, upon ten (10) days’ prior written notice, to the inspection of the Land Board and its representatives who may, at the Land Board’s expense, copy or extract all or a portion of said books, records, and accounts for a period of up to five (5) years after the date such books, records and accounts are made. The Land Board’s right to inspect shall not prejudice the Land Board’s right to collect payments due pursuant to this Agreement. The Land Board may, upon no less than fourteen (14) days’ prior written notice to Rangeview, its Service Provider, and/or the Export Water Contractor, cause a partial or complete audit of the entire records and operations of Rangeview, its Service Provider, and/or the Export Water Contractor for a five (5) year period preceding the date of the audit relating to the ▇▇▇▇▇ Range and water use pursuant to this Agreement to be made at the Land Board’s expense by an auditor selected by the Land Board. Within fourteen (14) days following the Land Board’s notice, Rangeview, its Service Provider, and/or the Export Water Contractor shall make available to the Land Board’s auditor the books and records the auditor reasonably deems necessary or desirable for the purpose of making the audit. Any deficiency in the payment of royalties determined upon such inspection or audit shall be immediately due and payable by Rangeview, and by the inspected or audited party if other than Rangeview, together with interest thereon at the rate of two percent (2%) per month from the date or dates such amounts should have been paid. If such deficiency is in excess of two percent (2%) of the royalty previously paid, then Rangeview shall pay or cause the audited party if other than Rangeview to pay to the Land Board the actual cost of the audit at the time the deficiency is paid.

7.7 Royalties on Tap Fees. Rangeview shall pay or cause the Export Water Contractor, Export Water Purchaser, or Off-Site Water Purchaser, as applicable, to pay royalties to the Land Board in the amount of 2% of all gross tap fee revenues received with respect to Water Rights, provided that any tap fees applicable to the Sky Ranch Property shall be exempt from any such royalties.

ARTICLE 8

Development of Infrastructure

and Water Service on the ▇▇▇▇▇ Range

8.1 Rangeview Shall Serve. Subject to the requirement that customers pay any appropriate fees and charges and comply with reasonable policies, rules and regulations which may govern the activities of Rangeview acting in its capacity as the provider of water service to the ▇▇▇▇▇ Range, Rangeview shall, consistent with the terms of this Agreement, including Section 6.4, and consistent with the obligations of the Service Provider as set forth in Article 9 below, provide water service during the term of this Agreement to all Water Users, except with regard to the waivers set forth on Exhibit K attached hereto and the Reserved Water. All Water Users shall be required to obtain water service exclusively from Rangeview. All such service, whether actually provided by Rangeview, or some other entity as may be approved by the Land Board, shall remain the primary obligation and responsibility of Rangeview, and shall be provided in a commercially reasonable time and manner consistent with prudent water service practice in Colorado.

Rangeview and the Service Provider shall provide, within a reasonable time frame, to the Land Board plans and projections reasonably evidencing that Rangeview and the Service Provider can perform their respective obligations to provide water to future Water Users within a reasonable time frame under the schedule of any future proposed real estate, mining, oil and gas, or other future proposed development or use of the ▇▇▇▇▇ Range, upon terms and conditions reasonably acceptable to the Land Board in consultation with the future Water User associated with such development. If the Land Board reasonably determines that Rangeview or the Service Provider cannot perform their respective obligations on terms and conditions and in a delivery time frame acceptable in accordance with commercially reasonable and prudent water provider practice in Colorado, the Land Board shall deliver to Rangeview and the Service Provider a written notice specifically stating the reasons for its determination, and the Land Board and the future Water User shall not be under any obligation to take water or water service from Rangeview or the Service Provider and may receive water or water service from any other source or provider. In determining whether Rangeview or the Service Provider can reasonably perform their respective obligations, the Land Board shall only consider the terms and conditions and the delivery time frame upon which such obligations will be performed. In the event of a dispute as to the Land Board’s determination, the Land Board and Rangeview agree to enter into dispute resolution in accordance with Section 15.16.

8.2 Water Fees and Rates. Tap fees, usage charges, and service charges to Water Users on the ▇▇▇▇▇ Range for Non-Export Water shall not exceed the average of those similar charges then imposed by the Town of Castle Rock, East Cherry Creek Valley Water and Sanitation District, and ▇▇▇▇▇▇ Water and Sanitation District, or their respective successors.

8.3 Substitution of Facilities. All contracts for the sale of Export Water and Off-Site Water shall allow Rangeview, the Service Provider, or the Land Board (upon the expiration or termination of this Agreement), as applicable, at its option, to utilize the ground water ▇▇▇▇▇ and transmission facilities which are used to produce Export Water or Off-Site Water under the following conditions:

(a) Rangeview, the Service Provider or the Land Board, as applicable, must provide substitute well capacity (the “Substitute Facilities”) of equivalent quantity and, to the extent practicable, water quality as the well capacity utilized by the Export Water Contractor under this Section 8.3.

(b) Subject to further substitution, the Substitute Facilities will be dedicated to the benefit of the Export Water or Off-Site Water user, as applicable. Title to the Substitute Facilities shall be held in the same manner as title to the facilities which they replace.

(c) The construction and operation of the Substitute Facilities are intended to enable Rangeview, the Service Provider or the Land Board, as applicable, to incrementally expand the delivery system for the Export Water and/or Off-Site Water to provide service to those areas of the ▇▇▇▇▇ Range on which the Export Water and/or Off-Site Water delivery system has already been developed.

(d) The intent of this Section 8.3 is to allow Rangeview, the Service Provider or the Land Board, as applicable, the use of that portion of the Export Water or Off-Site Water delivery system, utilizing the excess capacity as discussed in Section 8.4, to provide water service to the ▇▇▇▇▇ Range. The further intent of this Section 8.3 is to ensure that facilities initially constructed to serve Export Water or Off-Site Water will, as necessary, be available for service to the ▇▇▇▇▇ Range if Substitute Facilities are constructed and dedicated to the Export Water or Off-Site Water user as outlined in Sections 8.3(a) and (b). The Export Water or Off-Site Water user will have the same opportunity to substitute facilities from the Non-Export Water delivery system for the Export Water or Off-Site Water delivery system so that the well field is developed in a manner reasonably consistent with the master plan attached hereto as Exhibit D. The well field and Non-Export Water for use on-site, Off-Site Water, or Export Water delivery systems, when fully completed, shall have been developed in a manner such that each of Rangeview, the Service Provider, the Land Board or the Export Water Contractor, as applicable, shall bear the economic burden of developing its proportionate part of the total infrastructure serving Water Users on the ▇▇▇▇▇ Range and outside the ▇▇▇▇▇ Range.

(e) In the event a dispute arises concerning substitution of facilities pursuant to this Section, the dispute shall be resolved by arbitration pursuant to Section 15.16 of this Agreement.

8.4 Right to Use Transmission Lines; Infrastructure. All contracts for the sale of Export Water and Off-Site Water will provide for construction of excess capacity in Export Water or Off-Site Water transmission lines, as applicable, only within the ▇▇▇▇▇ Range, so as to accommodate the transmission of water for on-site use within that portion of the ▇▇▇▇▇ Range which may be served by those lines. The Service Provider, Rangeview, or the Land Board, as applicable, shall have access to and the right to use such excess capacity. The well field and delivery systems built for delivery of Export Water or Off-Site Water must be built in a commercially reasonable manner using accepted engineering practices considering the requirements of Section 8.3 and 8.4 related to the development of infrastructure for water service on or off the ▇▇▇▇▇ Range. The costs of constructing (1) infrastructure to deliver Export Water or Off-Site Water; and (2) the excess pipeline capacity required by this Section will not be paid, directly or indirectly, by Rangeview, the Land Board, or Water Users (except to the extent such facilities are substituted for on-site service, in which case Water Users will indirectly bear costs through rates and charges and Rangeview may incur administrative and maintenance expenses with respect thereto). Ownership of the excess capacity needed for on-site use, to the extent not already owned by Rangeview, the Service Provider, or the Land Board, will be transferred to Rangeview, the Service Provider, or the Land Board (upon the expiration or termination of this Agreement), as applicable, at such time as such capacity is utilized, under agreements which provide for the payment by Rangeview, the Service Provider, or the Land Board, as applicable, of a proportionate share of operation, maintenance and replacement costs.

8.5 Title to Equipment and Improvements. Rangeview acknowledges and shall cause its Service Provider to acknowledge that equipment and improvements placed on the ▇▇▇▇▇ Range are subject to the provisions of this Agreement. Rangeview shall pay or cause its Service Provider to pay all taxes, fees, assessments or other charges, if any, which may be assessed upon or become due with respect to, the equipment and improvements during the term of this Agreement. On the Effective Date, this Agreement shall be recorded with the Clerk and Recorder for Arapahoe County.

8.6 Future Leases. The Parties acknowledge that the ▇▇▇▇▇ Range is tax exempt as long as it is owned by the Land Board or another tax exempt entity and that the operation of Rangeview is based upon a revenue and not a tax base. The provisions of any leases or contracts for exchanges, sales or other dispositions pertaining to any interest in the surface of the ▇▇▇▇▇ Range shall not restrict the ability of Rangeview to sell water exclusively to, and receive revenue from, Water Users. Unless expressly authorized in writing by the Land Board or unless otherwise required by law, Rangeview will not impose taxes, assessments or other charges of any kind on Water Users in connection with the provision of, or cost to deliver, Non-Export Water to such Water Users except as contemplated by Section 8.2; provided that Rangeview may assess amounts it is required to pay in lieu of taxes pursuant to § 36 1-120.5(5), 15 C.R.S. (1990 Rplc.).

8.7 Rangeview District Boundaries. If required by the Land Board, subject to complying with reasonable policies, rules and regulations which may govern the activities of Rangeview, and to the extent permitted by law, upon petition for inclusion by a landowner within the ▇▇▇▇▇ Range qualified under Title 32 or other appropriate action thereafter, Rangeview shall cooperate and, with due diligence proceed to take action pursuant to law, to include such area as may be designated by such petition or other action within Rangeview’s district boundaries.

8.8 Development of ▇▇▇▇▇ Range. The nature, timing, financing, and approval of development of any land uses shall be the sole responsibility of the Land Board. The Land Board makes no representation as to if, when, and how the land development, if any, on the ▇▇▇▇▇ Range will occur, or as to the density of any such development.

8.9 Reserves. Rangeview shall establish and maintain a maintenance and operating reserve for providing Non-Export Water to Water Users in accordance with Section 8.1. The amount of such reserve shall be at least equal to thirty-three and one-third percent (33-1/3%) of the Operating Expenses budgeted by Rangeview and, if applicable, its Service Provider, for the then current calendar year. In establishing such reserve initially and in increasing the amount of such reserve as a result of an increase in budgeted Operating Expenses or an expenditure which diminishes the reserve below the required amount, Rangeview shall allocate any available funds not budgeted to other proper and necessary functions of Rangeview toward building such reserve. Such reserve funds shall be continuously maintained and may be utilized by Rangeview solely for paying lawful obligations relating to the provision of Non-Export Water to Water Users as required by Section 8.1.

8.10 Sale or Assignment of Reservoir Rights. Rangeview, the Service Provider and the Export Water Contractor may sell, assign or release their respective rights as set forth in Exhibit D of the A&R Lease to (a) Reservoir A decreed for 6,200 acre-feet of storage and 381 acres, (b) Reservoir B decreed for 10,000 acre-feet of storage and 359 acres, and (c) Reservoir D decreed for 4,000 acre-feet of storage and 170 acres, to the City of Aurora, Colorado, its designee or an affiliate on its behalf. For the sake of clarity, the transfers contemplated by this Section 8.10 shall not be subject to any royalty or other payment from Rangeview, the Service Provider or the Export Water Contractor to the Land Board under this Agreement. Rangeview acknowledges and agrees that any such transaction will not affect, impact or convey any rights the Land Board has in the ▇▇▇▇▇ Range.

ARTICLE 9

Service Provider Contract

9.1 Service Provider for Rangeview. As of April 11, 1996, Rangeview entered into a Service Provider contract in the form attached hereto as Exhibit B-1 (the “Service Agreement”) pursuant to which a Service Provider agreed to provide the service of delivering Non-Export Water to current and future Water Users pursuant to and consistent with the terms of the A&R Lease. As of the Effective Date, at its option Rangeview may amend its Service Provider contract to allow its Service Provider to provide the service of delivering Off-Site Water to users Off-Site pursuant to and consistent with the terms of this Agreement and to otherwise reflect the terms of this Agreement to the extent applicable. Such amendment shall be substantially in the form of Exhibit B-2. Rangeview shall not enter into any other Service Provider contract except as contemplated by this Agreement without the express written consent of the Land Board. All future Service Provider contracts shall be substantially in the form of Exhibit B-2 only with such changes as may be approved in writing by the Land Board. If Rangeview chooses to contract with a Service Provider to provide Non-Export Water services on the ▇▇▇▇▇ Range or Off-Site Water, Rangeview shall cause such Service Provider to comply with all obligations of Rangeview under this Agreement relating to Non-Export Water services on the ▇▇▇▇▇ Range or Off-Site Water. Rangeview agrees (and will cause any other Service Provider to agree) that:

(a) The Service Provider contract cannot be assigned or transferred without the express written consent of the Land Board, which consent may be withheld by the Land Board in its sole discretion. The Service Provider contract cannot be amended without the express written consent of the Land Board, which consent shall not be unreasonably withheld.

(b) Any breach by the Service Provider of its obligations under its Service Provider contract with Rangeview shall constitute a breach of this Agreement by Rangeview subject to Rangeview’s right to cure such breach or default.

(c) Ten (10) days prior to the execution of any construction or financing contracts by Rangeview or the Service Provider in excess of Five Hundred Thousand Dollars ($500,000) related to the provision of Non-Export Water Service to Water Users (including contracts for the disposal of effluent, sewage or sewerage as permitted under Section 6.3 of this Agreement), Rangeview shall provide or cause the Service Provider to provide the Land Board with courtesy copies of such contracts (drafts being acceptable if finals are not yet available).

(d) Water service on the ▇▇▇▇▇ Range shall be provided as needed in a commercially reasonable time and manner consistent with prudent water service practice in Colorado if and when development of the surface of the ▇▇▇▇▇ Range may occur.

(e) If there is an approved Service Provider, all financing for infrastructure for delivery of Water Rights to Water Users and all costs of operation, maintenance, debt service and repair to provide water service to Water Users will be provided without cost to Rangeview, the Land Board or any Water User on the ▇▇▇▇▇ Range, except to the extent paid for with the water fees and rates described in Section 8.2, and Rangeview shall not issue bonds to finance such infrastructure or service.

(f) Re-use and successive use of Non-Export Water, if any, shall be done in a commercially reasonable manner consistent with prudent water provider practice in Colorado.

(g) If the Service Provider decides not to provide or not to continue providing service during the term of this Agreement, then Rangeview shall require the Service Provider to give one (1) year’s prior written notice to Rangeview which written notice shall be transmitted by Rangeview to the Land Board. During such one-year period, the Service Provider shall continue to provide service in accordance with the terms of the Service Agreement, unless Land Board and Rangeview require the Service Provider to discontinue providing services prior to the expiration of such one-year period.

(h) Rangeview and its Service Provider shall, at all times, act in a commercially reasonable manner consistent with prudent water provider practice in Colorado.

(i) If and to the extent at any time monies are not available to Rangeview to fund the reserve which Rangeview is required to maintain pursuant to Section 8.9 or if monies in such reserve are withdrawn such that the amount of the reserve drops below the amount which Rangeview is required to maintain and such reserve cannot reasonably be expected to be reestablished from anticipated income to Rangeview within one year, then Rangeview shall promptly notify the Service Provider of such fact and the Service Provider shall within thirty (30) days deliver funds to Rangeview sufficient to replenish the reserve fund to its required level. Notwithstanding the fact that the reserve can reasonably be expected to be reestablished within one year, the Service Provider shall be required to deliver funds to Rangeview sufficient to replenish the reserve fund to its required level at the time the Service Provider discontinues service.

ARTICLE ▇▇

▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇ and Sanitation District

10.1 Terms and Revenue. The terms of the East Cherry Creek Agreement are not altered or affected by this Agreement, nor is its duration extended. All revenue paid by ECCV pursuant to the East Cherry Creek Agreement subsequent to the effective date of the A&R Lease shall be paid as follows: fifty percent (50%) to be paid by Rangeview directly to the Land Board (unless ECCV agrees to pay such fifty percent (50%) directly to the Land Board) and fifty percent (50%) to be paid by ECCV directly to Rangeview. No additional royalty with respect to the revenue derived from the East Cherry Creek Agreement shall be payable to the Land Board.

10.2 Title Reversion. Upon the expiration or termination of the East Cherry Creek Agreement, for whatever reason, all interests in the water, infrastructure, and leased premises related thereto, to the extent provided for in the East Cherry Creek Agreement, shall automatically and without further act of the Parties or anyone else revert to the Land Board free and clear of this Agreement. The Land Board agrees not to take any action inconsistent with the Land Board’s rights, duties, and obligations of this Agreement which would cause Rangeview to be in default or otherwise result in liability to Rangeview under the East Cherry Creek Agreement. Nothing in the preceding sentence shall prevent the Land Board or Rangeview from taking any actions they are permitted to take by law with respect to ECCV.

ARTICLE 11

Rights-of-Way

11.1 Master Plan. The Parties agree to a master plan of rights-of-way, which plan is attached to this Agreement as Exhibit D. To the extent not already granted, the rights-of-way described on Exhibit D shall be granted by Land Board to Rangeview within sixty (60) days of Rangeview’s complete application with Land Board for specific rights-of-way, provided that the requested rights-of-way are necessary for construction of facilities within a reasonable time after the rights-of-way are to be granted. Except as otherwise provided in Section 6.2(a)(ii)(1), the grant shall be made in accordance with the form attached as Exhibit F, which form may be amended to comply with applicable statutes, regulations and Land Board policy directives from time to time. Said master plan may be amended by Land Board for the convenience of the Parties, provided that any such amendment shall not materially adversely affect the rights and privileges of any Party. The total acres of rights-of-way shall not be reduced and the Land Board may relocate rights-of-way, whether planned or in use, for the commercially reasonable development of the ▇▇▇▇▇ Range. If the Land Board relocates rights-of-way which are in use by Rangeview, its Service Provider or the Export Water Contractor (or which any such entity has expended funds to develop for use), then the Land Board must pay the affected entities’ costs associated with relocating such rights-of-way.

11.2 Fee for Right-of-Way. Rangeview shall pay the Land Board an amount equal to Fifty Dollars ($50.00) per acre of the surface land utilized at the time of granting a right-of-way, which, commencing with the effective date of the A&R Lease, shall be increased every five (5) years proportionally to the five (5) year increase in the Index. In no case shall the rights-of-way fee be reduced. Land Board shall include a description of the master plan of rights-of-way in subsequent leases, sales or other dispositions pertaining to the ▇▇▇▇▇ Range and shall, subject to the amendment provisions set forth in Section 11.1, be bound by such master plan in all subsequent leases, sales or other dispositions.

Notwithstanding the foregoing, with respect to Realigned Reservoir C, Rangeview shall pay the Land Board fifty dollars ($50) per acre, as increased every five (5) years proportionally to the five (5) year increase in the Index as described above, for the right-of-way to the first 260 acres needed for Realigned Reservoir C. Subject to Section 6.2(a)(i) (including any alterations pursuant thereto), the additional right-of-way for the remaining acreage required for Realigned Reservoir C, as shown on Exhibit L attached hereto, and any additional right-of-way acreage that is reasonably required to access Realigned Reservoir C, as mutually and reasonably agreed between the Parties, shall be granted in exchange for payment to the Land Board of the fair market value of the land based on the highest and best use of the land, but excluding from such valuation any transactions or estimations of value based on the land being used as a reservoir site.

Notwithstanding anything else to the contrary herein, Rangeview shall pay the Land Board fair market value for any future additional rights-of-way requested by Rangeview after the Effective Date of this Agreement required for Rangeview’s disposal of untreated effluent, sewage, or sewerage.

11.3 License to Service Provider. To the extent necessary to implement the intent of Article 11, Rangeview may grant to its Service Provider and/or the Export Water Contractor a license to use the rights-of-way granted by the Land Board to Rangeview for the purposes contemplated by this Agreement. Such licenses shall be in the forms attached hereto as Exhibits G and H, respectively.

ARTICLE 12

Bonding Requirements

12.1 Bond. No operations are to be commenced on the ▇▇▇▇▇ Range until Rangeview, its Service Provider or the Export Water Contractor or their agents have filed good and sufficient bonds with Land Board consistent with the requirements of C.R.S. § ▇▇-▇▇-▇▇▇ and § 36-1-129 in an amount fixed by Land Board, to secure the payment for damages, losses or expenses caused by Rangeview, its Service Provider or the Export Water Contractor or their agents as a result of operations on or under the ▇▇▇▇▇ Range. Land Board may waive the bonding requirements, in its discretion, and may require that the bond be maintained in full force and effect for one (1) year after cessation of the operations for which the bond was intended.

12.2 Bond of Contractors. Bonds provided by contractors for construction activities to Rangeview, its Service Provider or the Export Water Contractor may list Land Board as a coinsured. As long as such bonds otherwise comply with Section 12.1 above and list Land Board as coinsured, the contractors shall not be required to obtain any other bonds for the Land Board. Contracts entered into by Rangeview, its Service Provider or the Export Water Contractor which constitute public works shall comply with § ▇▇-▇▇-▇▇▇, 103.5 and 103.6, 10B C.R.S. (1988 Rplc.).

ARTICLE 13

Default and Remedies

13.1 Events of Default. The following events shall hereinafter be referred to as “Events of Default”:

(a) Rangeview shall default in the due and punctual payment of royalties, rents or any other amounts payable hereunder, and such default shall continue for ten (10) business days after the applicable due date;

(b) This Agreement shall be transferred to or shall pass to or devolve upon any other person or Party except as expressly permitted by this Agreement;

(c) This Agreement or the Non-Export Water or any part thereof shall be taken upon execution or by other process of law directed against Rangeview, or shall be taken upon or subject to any attachment at the instance of any creditor or claimant against Rangeview, and said attachment shall not be discharged or disposed of within sixty (60) days after the levy thereof;

(d) Rangeview shall file a petition in bankruptcy or insolvency or for reorganization or arrangement under the bankruptcy laws of the United States or under any insolvency act of any state, or shall be dissolved or shall make an assignment for the benefit of creditors;

(e) Involuntary proceedings under any such bankruptcy law or insolvency act or for the dissolution of Rangeview shall be instituted against Rangeview, or a receiver or trustee shall be appointed for all or substantially all of the property of Rangeview, and such proceeding shall not be dismissed or such receivership or trusteeship vacated within sixty (60) days after such institution or appointment;

(f) If any Party shall fail to perform any material term, covenant or condition herein contained and such failure shall continue and not be cured for a period of thirty (30) days after written notice specifically setting forth the nature of the default has been given by the non-defaulting Party to the defaulting Party, or if more than thirty (30) days is reasonably required to cure such matter complained of, if the defaulting Party shall fail to commence to correct the same within said thirty (30) day period and shall thereafter fail to prosecute the same to completion with reasonable diligence. For purposes of this subparagraph (f), if Rangeview has a Service Provider and such Service Provider shall breach any of its obligations to Rangeview, or if the Export Water Contractor shall breach any of its obligations to Rangeview, or if an Export Water Purchaser or Off-Site Water Purchaser shall breach any of its obligations to Rangeview or the Export Water Contractor, and such acts or omissions also constitute or result in the failure to perform a material obligation for which Rangeview has responsibility hereunder, then the same shall constitute a material failure of performance by Rangeview. Further in such event, the thirty (30) day period provided in the first sentence of such subparagraph (f) shall be extended up to a maximum of sixty (60) days if Rangeview first attempts to require its Service Provider, the Export Water Contractor, Export Water Purchaser or Off-Site Water Purchaser, as applicable, to cure during any applicable cure period provided in the agreements applicable to the defaulting Party, so that if in such case the Service Provider, the Export Water Contractor, Export Water Purchaser or Off-Site Water Purchaser, as applicable, fails to cure, Rangeview itself shall have an additional thirty (30) days to cure such material failure of performance. Thus, for example, if such a material failure of performance results from an act or omission of Rangeview’s Service Provider, the Land Board may immediately give Rangeview notice regarding the same and thereby commence the running of Rangeview’s cure period. That period would be thirty (30) days, unless Rangeview in turn gives notice to its Service Provider and commences an applicable cure period under the Service Provider Agreement, in which case if the Service Provider fails to cure, Rangeview would have an additional thirty (30) days to cure; provided that no more than a total of sixty (60) days shall be allowed for such cure period (subject to any reasonably required extension as provided in the first sentence of this paragraph (f)).

13.2 Remedies. If any one or more Events of Default shall occur and not be cured within any applicable cure period, then:

(a) If Rangeview is the defaulting Party, Land Board, without prejudice to any other remedies that it may have, may give written notice of its intention to terminate this Agreement on the date of such notice or on any later date specified in such notice, and, on the date specified in such notice, Rangeview’s right to possession of the premises will cease and this Agreement will be terminated (except as to Rangeview’s liability set forth in this Section 13.2) as if the expiration of the term fixed in such notice were the end of the term of this Agreement. In connection with such termination, Land Board with notice may re-enter and take possession of the leased premises or any part thereof (subject to any existing licenses related to delivery of Export Water) and repossess the same as the Land Board’s former estate, and expel Rangeview from the premises and those claiming through or under Rangeview except with respect to the Export Water, and remove the effects of both or either, without being deemed guilty of any manner of trespass and without prejudice to any other remedies. In the event of such termination, Rangeview and its Service Provider shall surrender and peacefully deliver to the Land Board the above described land and the Non-Export Water, and such land as was in Rangeview’s possession or control shall be returned to the Land Board in good condition (subject to any existing licenses related to the delivery of Export Water), and the Land Board shall be entitled to the return of all Non-Export Water, plus the title to all infrastructure built to divert or withdraw and deliver Non-Export water and any other interest in shared facilities for use with the Non-Export Water, plus the revenue stream associated with such Non-Export Water and the East Cherry Creek Agreement, and the reserves required to be maintained by Rangeview pursuant to Section 8.9. Upon such termination, if Rangeview shall remain in possession of any part of the ▇▇▇▇▇ Range (subject to any existing licenses related to delivery of Export Water) or Non-Export Water, Rangeview shall be guilty of an unlawful detainer and shall be subject to eviction or removal, forcibly or otherwise, to the extent provided by law.

(b) In the Event of Default by any Party, the non-defaulting Party shall be entitled to any and all damages proximately caused by the default or breach and its costs and reasonable attorney fees (to the extent permitted by law) from the defaulting Party. In addition, Rangeview shall be entitled to specifically enforce performance by the Land Board of the Land Board’s obligations under this Agreement.

13.3 No Waiver. No failure by Rangeview or the Land Board, to insist upon the strict performance of any agreement, term, covenant or condition hereof or to exercise any right or remedy consequent upon a breach thereof, and no acceptance of full or partial payment of any amount payable during the continuance of any such breach, shall constitute a waiver of any such breach of such agreement, term, covenant or condition hereof to be performed or complied with by Rangeview or the Land Board, as the case may be. No breach thereof shall be waived, altered, or modified except by written instrument executed by the Land Board, or Rangeview, as the case may be. No waiver of any breach shall affect or alter this Agreement, but each and every agreement, term, covenant and condition hereof shall continue in full force and effect with respect to any other then-existing or subsequent breach thereof. Notwithstanding any termination of this Agreement, the same shall continue in force and effect as to any provisions hereof which require observance or performance of Rangeview or Land Board subsequent to termination.

13.4 Land Board’s Right to Cure Rangeview’s Breach. The Land Board may, but shall not be obligated to, cure any default by Rangeview, specifically including, but not by way of limitation, Rangeview’s failure to pay any tax due hereunder, obtain insurance, make repairs, or satisfy lien claims, after providing reasonable notice to Rangeview, and whenever the Land Board so elects, all costs and expenses paid by the Land Board in curing such default, including, without limitation, reasonable attorneys’ fees, shall be so much additional rent due ten (10) days after such payment together with interest at the rate of two percent (2%) per month from the date of advancement to the date of repayment by Rangeview to the Land Board.

ARTICLE 14

Improvements

14.1 Transfer of Improvements. In the event this Agreement is terminated by forfeiture, surrender, or election upon default or breach, and no later than the expiration of this Agreement, title to all improvements and equipment and related permits and licenses and all rights-of-way on the ▇▇▇▇▇ Range exclusively for delivering Non-Export Water and interests in shared facilities used for delivery of Non-Export Water shall automatically, without the necessity of any further action by the Parties or anyone else, revert and be transferred to the Land Board as of the date of such forfeiture, surrender, election, upon default or breach, or as of the expiration of the Agreement. Such automatic reversion and transfer shall be conclusively evidenced of record by the Land Board’s filing with the Clerk and Recorder for Arapahoe County a certificate stating the fact of such reversion and transfer. Title to improvements and rights-of-way on the ▇▇▇▇▇ Range for the sale of the use of Export Water including, without limitation, the East Cherry Creek Agreement, shall not be affected by termination of this Agreement.

14.2 Abandonment of Export Water Facilities. Once the Export Water Contractor (including any of its assigns and any Export Water Purchasers) withdraws the entire portion of the Export Water purchased plus the entire amount of water recharged by the Export Water Contractor and the Export Water Contractor has failed to recharge any portion of the aquifer for a period of ten (10) years, the Land Board shall have the right to notify the Export Water Contractor in writing of its intention to declare the rights-of-way, improvements and equipment on the ▇▇▇▇▇ Range owned or licensed by the Export Water Contractor as abandoned. The Export Water Contractor shall have three (3) months from receipt of such notice to remove any improvements and equipment which can be removed without damaging the ▇▇▇▇▇ Range or any shared facilities. At the end of such three (3) month period, title to any improvements and equipment then remaining and all rights-of-way shall automatically, without necessity of any further action by the Export Water Contractor or anyone else, revert and be transferred to the Land Board as of such date. Such automatic reversion and transfer shall be conclusively evidenced of record by the Land Board’s filing with the Clerk and Recorder for Arapahoe County a certificate stating the fact of such reversion and transfer. In the event of a dispute regarding this Section 14.2, the matter shall be determined by arbitration pursuant to Section 15.16 of this Agreement.

ARTICLE 15

General Provisions

15.1 Assignment by Rangeview, the Service Provider or Export Water Contractor. Rangeview may assign its interest in this Agreement, but only upon terms expressly approved in writing by the Land Board in its sole discretion. The Service Provider may assign its interest in this Agreement, but only in accordance with the Service Agreement and only upon terms expressly approved in writing by the Land Board in its sole discretion. Export Water Contractor shall be entitled to assign any of its interests in the Export Water pursuant to the terms of this Agreement; provided, however that the Export Water Contractor may not assign any of its obligations under this Agreement without assigning the corresponding rights under the Agreement without the express approval in writing of the Land Board in its sole discretion. Any attempted assignment in contravention of this section shall be null and void. This provision shall not limit in any way Export Water Contractor’s right to sell, assign or otherwise transfer the Export Water granted to the Export Water Contractor by the Land Board and Rangeview in the Bargain and Sale Deed, dated April 11, 1996, filed in Arapahoe County at Reception No. A6097802.

15.2 Work Requirements. To the extent work is performed on the ▇▇▇▇▇ Range directly by (i) Rangeview or its Service Provider (ii) independent contractors of Rangeview or its Service Provider or (iii) a permitted assignee (in which case any reference to Rangeview shall be deemed to be a reference to the assignee where appropriate), the following shall apply:

(a) Indemnity. Rangeview and its Service Provider shall jointly and severally indemnify and hold harmless the Land Board against and from all liabilities, claims and demands, settlement or litigation expenses and related attorneys’ fees (hereafter “Indemnified Items”) for personal injury or property damage arising out of, or caused by, any act or omission of Rangeview, its Service Provider, or their contractors, agents or employees.

(b) Insurance. Rangeview shall at all times carry insurance in the amounts and for the liabilities required by § ▇▇-▇▇-▇▇▇, 10A C.R.S. (1988 Repl.), as amended, which insurance shall name the Land Board as an additional insured. Rangeview shall require its Service Provider at all times to carry insurance in amounts and with carriers reasonably acceptable to the Land Board for worker’s compensation coverage in accordance with Colorado law, and for public liability insurance covering death and bodily injury with limits of not less than One Million Five Hundred Thousand Dollars ($1,500,000.00) for one person, and Five Million Dollars ($5,000,000.00) for any one accident or disaster, and property damage coverage with limits of not less than Five Hundred Thousand Dollars ($500,000.00), which insurance shall name the Land Board as an additional insured. The Land Board reserves the right to reasonably increase the limits of insurance required of the Service Provider as the Land Board may deem appropriate from time to time; provided that, if Rangeview or the Service Provider disputes the reasonableness of such increase, the matter shall be submitted to arbitration as provided in Section 15.16.

(c) Liens. Except with respect to liens or encumbrances expressly permitted hereunder, Rangeview and its Service Provider shall jointly and severally indemnify and hold the Land Board harmless from and against all Indemnified Items relating to liens or claims of right to enforce liens arising from actions of Rangeview or its Service Provider, their contractors and agents. Rangeview and its Service Provider shall promptly cause any such lien to be removed notwithstanding the fact that Rangeview may believe that there is a valid defense to any such claim. Rangeview and its Service Provider shall retain the right to pursue any claims against the claimant after any such lien is removed.

(d) Permits and Licenses. Rangeview and its Service Provider shall, at their own expense, apply for and obtain all necessary building, occupancy, well and other permits and licenses which may be required by any governmental entity which has jurisdiction over the operations to be performed pursuant to this Agreement. Copies of all such permits and licenses shall be provided to the Land Board.

(e) Taxes. Rangeview and its Service Provider shall be jointly and severally responsible for and shall pay all taxes, fees and assessments, including payments pursuant to § 36-1-120.5(5), 15 C.R.S. (1990 Rplc.), if any, in connection with the work, improvements, facilities or the materials to be utilized in accomplishing the activities of Rangeview or its Service Provider pursuant to this Agreement.

15.3 Third Party Beneficiaries. Except as otherwise contemplated by the provisions of this Agreement, it is not the intent of the Parties, nor shall it be the effect of this Agreement, to vest rights of any nature or form in individuals or entities not executing this Agreement.

15.4 Notice. All notices required by this Agreement shall be in writing and shall be delivered to the person to whom the notice is directed, either in person, by courier service or by United States mail as a certified item, return receipt requested, addressed to the address stated below. Notices delivered in person or by courier service shall be deemed given when delivered to the person to whom the notice is directed. Notices delivered by mail shall be deemed given on the date of delivery as indicated on the return receipt. The Parties may change the stated address by giving ten (10) days’ written notice of such change pursuant to this section.

RANGEVIEW METROPOLITAN DISTRICT:

Rangeview Metropolitan District

▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇

▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇

Attn: President

With a copy to:

Pure Cycle Corporation

▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇

▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇

Attn: President

STATE BOARD OF LAND COMMISSIONERS:

Board of Land Commissioners

Attention: Director

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With a copy to:

Office of Attorney General

Attn: State Land Board Attorney

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15.5 Construction. Where required for proper interpretation,, words in the singular shall include the plural, and the masculine gender shall include the neuter and the feminine, and vice versa, as is appropriate. The article and section headings are for convenience and are not a substantive portion of this Agreement. This Agreement shall be construed and interpreted in accordance with the laws of the State of Colorado. It shall be construed as if it were equally drafted in all aspects by all Parties.

15.6 Entire Agreement. This Agreement, including the items attached in accordance with the provisions of this Agreement, the Service Provider Agreement and the Settlement Agreement of even date herewith, constitute the entire agreement among the Parties pertaining to the subject matter of this Agreement and supersede all prior and contemporaneous agreements and understandings of the Parties as to the subject matter of this Agreement. No representation, warranty, covenant, agreement or condition not expressed in this Agreement shall be binding upon the Parties or shall change or restrict the provisions of this Agreement.

15.7 Authority. Each of the Parties represents and warrants that it has all requisite power, corporate and otherwise, to execute, deliver and perform its obligations pursuant to this Agreement, that the execution, delivery and performance of this Agreement and the documents to be executed and delivered pursuant to this Agreement have been duly authorized by it, and that upon execution and delivery, this Agreement and all documents to be executed and delivered pursuant to this Agreement will constitute its legal, valid and binding obligations, enforceable against it in accordance with their terms.

15.8 Copies. Numerous copies of this Agreement have been executed by the Parties. Each such executed copy shall have the full force and effect of an original, executed Agreement.

15.9 Amendment. This Agreement shall not be amended except by a writing executed by all Parties.

15.10 Compliance with Law. Rangeview and the Land Board covenant and agree that during the continuance of this Agreement, they shall comply fully with all provisions, terms, and conditions of all laws whether state or federal, and orders issued thereunder, which may be in effect during the continuance hereof, which in any manner affect their operations and the ▇▇▇▇▇ Range and the Water Rights which are the subject of this Agreement.

15.11 Binding Effect. The benefits and terms and obligations of this Agreement shall extend to and be binding upon the successors or permitted assigns of the respective Parties hereto.

15.12 Severability. If any clause or provision of this Agreement is illegal, invalid or unenforceable under present or future laws effective during the term of this Agreement, then and in that event, it is the intention of the Parties hereto that the remainder of this Agreement shall not be affected thereby. It is also agreed that in lieu of each clause or provision of this Agreement that is illegal, invalid or unenforceable, there shall be added as a part of this Agreement a clause or provision as similar in terms to such illegal, invalid or unenforceable clause or provision as may be possible and be legal, valid and enforceable.

15.13 [Reserved].

15.14 Further Assurance. Each of the Parties hereto, at any time and from time to time, will execute and deliver such further instruments and take such further action as may reasonably be requested by the other Party hereto, in order to cure any defects in the execution and delivery of, or to comply with or accomplish the covenants and agreements contained in, this Agreement and/or any other agreements or documents related thereto.

15.15 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado and applicable federal law.

15.16 Arbitration. Any controversy or claim arising out of or relating to the computation of royalties or net profits interest under this Agreement, and all other controversies or claims which the Parties have expressly agreed herein shall be submitted to arbitration, shall be settled by arbitration in accordance with the Commercial Rules of the American Arbitration Association, including discovery, experts, evidence and hearings; provided however, that the arbitration shall be by majority decision of a panel of three arbitrators, at least two of whom shall have experience and expertise in water rights or water utility matters, who may, but need not, be affiliated with the American Arbitration Association. Judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof. Arbitration shall be instituted on written demand of any Party, setting forth the issues to be arbitrated. The Party responding to the arbitration demand shall respond to the demand within twenty (20) days, after which the Parties shall proceed to select arbitrators within thirty (30) days. If the Parties are unable within thirty (30) days to agree on three arbitrators, each shall appoint one arbitrator, who together shall appoint the third. If a Party fails to appoint an arbitrator within thirty (30) days, an arbitrator shall be appointed for such Party by the American Arbitration Association upon the request of another Party. Rangeview and the Land Board agree that the Service Provider or the Export Water Contractor, as applicable, may participate directly in any arbitration which affects such entity’s rights and/or obligations with respect to the Water Rights; provided such entity agrees to be bound by the arbitration award to the same extent as the Land Board and Rangeview. Arbitration shall be concluded and an award entered within 180 days of the completion of selection of the arbitration panel.

15.17 Litigation. Except as provided in Section 15.16 above, in the event of claims, disputes or other disagreements between the Parties which the Parties are not able to resolve amicably, any Party may bring suit in a court of competent jurisdiction seeking resolution of the matter.

15.18 Duty of Good Faith and Fair Dealing. The parties acknowledge and agree that each Party has a duty of good faith and fair dealing in its performance of this Agreement. Rangeview will advise the Land Board of its and its Service Provider’s activities no less than annually until such time as production of Water Rights exceeds 500 acre feet per year and thereafter, quarterly during the term of this Agreement and will respond to reasonable requests of the Land Board for additional information on Rangeview’s and its Service Provider’s activities affecting the ▇▇▇▇▇ Range.

15.19 Force Majeure. Should any Party be unable to perform any obligation required of it under this Agreement, other than the payment of money, due to any cause beyond its control (including, but not limited to war, insurrection, riot, civil commotion, shortages, strikes, lockout, fire, earthquake, calamity, windstorm, flood, material shortages, failure of any suppliers, freight handlers, transportation vendors or like activities, or any other force majeure), then such Party’s performance of any such obligation shall be suspended for such period as the Party is unable to perform such obligation.

IN WITNESS WHEREOF, the Land Board has caused these presents to be executed in multiple originals by the State Board of Land Commissioners and sealed with the official seal of the Land Board. Rangeview and Pure Cycle has similarly executed this Agreement this 10th day of July, 2014.

	STATE OF COLORADO STATE BOARD OF LAND COMMISSIONERS /s/ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, Director
	RANGEVIEW METROPOLITAN DISTRICT, ACTING BY AND THROUGH ITS WATER ACTIVITY ENTERPRISE /s/ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, President PURE CYCLE CORPORATION /s/ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, President

STATE OF COLORADO )

CITY AND ) SS.

COUNTY OF DENVER )

The foregoing instrument was acknowledged before me this 9th day of July, 2014, by ▇▇▇▇▇▇▇ ▇▇▇▇, as President of the State of Colorado, State Board of Land Commissioners.

Witness my hand and official seal.

My commission expires: March 25, 2018

/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Notary Public

STATE OF COLORADO )

CITY AND ) SS.

COUNTY OF DENVER )

The foregoing instrument was acknowledged before me this 10th day of July, 2014, by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as President of Rangeview Metropolitan District.

Witness my hand and official seal.

My commission expires: September 30, 2015

/s/ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
Notary Public

STATE OF COLORADO )

CITY AND ) SS.

COUNTY OF DENVER )

The foregoing instrument was acknowledged before me this 10th day of July, 2014, by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as President of Pure Cycle Corporation.

Witness my hand and official seal.

My commission expires: September 30, 2015

/s/ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
Notary Public

EXHIBIT INDEX

Exhibit A

Water Previously Conveyed

Exhibit B-1

Original Service Agreement

Exhibit B-2

Amended Service Agreement

Exhibit C

Export Water Contract

Exhibit D

Amended and Restated Master Plan

Exhibit E

[reserved]

Exhibit F

Right-of-Way Grant Form

Exhibit G

Service Provider Right-of-Way License

Exhibit H

Export Water Contractor Right-of-Way License

Exhibit I

Guaranty

Exhibit J

Aquifer Decree Allocation

Exhibit K

Waivers

Exhibit L

Realigned Reservoir C

Exhibit M

Sky Ranch Legal Description

Exhibit A

Water Previously Conveyed

Water Previously Conveyed. Incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit B-1

Original Service Agreement

Service Agreement, dated April 11, 1996, by and between the Registrant and the District. Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit B-2

Amended Service Agreement

Amended and Restated Service Agreement, dated July 11, 2014, by and between the Registrant and the District. For Exhibit B-2 to the 2014 Amended and Restated Lease Agreement, see Exhibit 10.5 filed herewith.

Exhibit C

Export Water Contract

Agreement for Sale of Export Water, dated April 11, 1996, by and among the Registrant and the District. Incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit D

Amended and Restated Master Plan

Amended and Restated Master Plan – This exhibit consists of a map of the ▇▇▇▇▇ Range which is approximately 24,567.21 acres, more or less, according to the U.S. Government survey, in Arapahoe County, Colorado. The full legal description of the ▇▇▇▇▇ Range is set forth in Exhibit 10.2 filed herewith. The map depicts proposed areas for managed development of the ▇▇▇▇▇ Range to be used in managing proposed rights-of-way and well sites for the development of water rights on and under the surface of the ▇▇▇▇▇ Range.

Exhibit E

[Reserved]

Exhibit F

Right-of-Way Grant Form

Right of Way Grant Form – Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit G

Service Provider Right-of-Way License

Service Provider Right-of-Way License – Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit H

Export Water Contractor Right-of-Way License

Export Water Contractor Right-of-Way License – Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit I

Guaranty

Guaranty, dated April 11, 1996, issued by the District in favor of the Land Board – Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-QSB for the period ended May 31, 1996.

Exhibit J

Aquifer Decree Allocation

The Parties agree to negotiate in good faith to reasonably determine a mutually acceptable allocation of Water Rights among each of the aquifers and among the Parties that is in accordance with the decrees by which such Water Rights were adjudicated, as such decrees may be amended from time to time, and the respective rights and obligations of the Parties in and to the Water Rights. In the event no agreement is reached, then the this Exhibit J shall be determined by arbitration pursuant to Section 15.16.

From and after the determination of Exhibit J in accordance with the foregoing paragraph, in the event that the decrees are subsequently amended, the Parties shall negotiate in good faith to agree upon an amended Exhibit J that is generally consistent with the allocation of Water Rights upon which the Parties mutually agreed in accordance with the foregoing paragraph.

Exhibit K

Waivers

The entities listed below, and their successors and assigns, shall be excluded from the requirement to have water services provided by Rangeview:

AG 41745 - RUNNING CREEK RANCH

OG 1960 - CONOCOPHILLIPS COMPANY

Exhibit L

Realigned Reservoir C

Realigned Reservoir C – This exhibit consists of a map of a portion of the ▇▇▇▇▇ Range depicting a proposed reservoir site for storage of water rights.

Exhibit M

Sky Ranch Legal Description

This exhibit consists of a complete legal description of the Registrant’s Sky Ranch Property consisting of approximately 932 acres, more or less, in Arapahoe County, Colorado.

2014 AMENDED AND RESTATED LEASE AGREEMENT between STATE OF COLORADO, ACTING BY AND THROUGH THESTATE BOARD OF LAND COMMISSIONERS, LESSOR and RANGEVIEW METROPOLITAN DISTRICT, LESSEE and PURE CYCLE CORPORATION, SERVICE PROVIDER AND EXPORT WATER...

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