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Home My WebLink About20181115Application.pdfGtvENs PunsLEY,,.. Attorneys and Counselors at Law 601 W. Bonnock Slreet PO Box2720 Boise. lD 83701 Telephone: 208-388- I 200 Focsimile: 208-388-l 300 www.givenspursley.com Michoel C. Creomer l2o8l3&1247 mcreomer@givenspuEley.com MCC:slc Enclosures 14425470-l.docx -t,t w. Hugh,O'RiorqG, LL.M.. . , Rondorl n,.Petehrfrn ....: IjGory G. Allen Chrjslopher J. Beeson Joson J. Blokley Clint R. Bolinder Jeff W. Bower Preslon N. Corter Jeremy C. Chou Williom C. Cole Michoel C. Creomer Amber N. Dino Brodley J. Dixon Thomos E. Dvorok Jeffrey C. Feredoy Deboro Kristensen Groshom Mortin C. Hendrickson Brion J. Holleron Kers'ti H, Kennedy Neol A. Koskello Michoel P. Lowrence Fronklin G. Lee Dovid R. Lombordi Kimberly D. Moloney Kenneth R. McClure Kelly Greene McConnell Alex P. McLoughlin Melodie A. McQuode Christopher H. Meyer L. Edword Miller Po'frick J. Miller Judson B. Montgomery Emly G. Mueller Deboroh E. Nelson Jock W. Relf Michoel O. Roe Jomie Coplon Smith P. Mork Thompson Jeffrey A. Worr Robert B. White Donold E. Knickrehm {relired) Kenneih L. Pursley (r940-20r5) Jomes A. Mcclure (t924-20f ) Roymond D. Givens (19r7-2008) November 15,2018 Wa Hand Delivery Diane Hanian, Secretary Idaho Public Utilities Commission 472 W . Washinglon Street Boise, Idaho 83720 Case Nos. SUZ-W-18-02 and EAG-W-18-01 Joint Application and Request for Modified Procedure Dear Ms. Hanian: Enclosed for filing is an original and seven (7) copies of SUEZ Water Idaho Inc. and Eagle Water Company, Inc.'s Joint Application and Request for Modified Procedure. Also enclosed for filing are the original and nine (9) copies of the Testimony and exhibits of Marshall Thompson, Cathy Cooper, Jarmila Cary and Robert DeShazo. One copy of each of these Testimonies has been designated as the "Reporter's Copy." In addition, a disc containing searchable PDFs of the Application and each Testimony, as well as the native Excel version of the Exhibit to Ms. Cary's Testimony, is also enclosed. An additional copy of each document is enclosed to be date stamped and returned. Should you have any questions, please do not hesitate to contact me. Sincerely, Re: -,G/n^/ Michael C. Creamer U Michael C. Creamer (ISB No. 4030) Givens Pursley LLP 601 W. Bannock St. Boise, ID 83702 Telephone: (208) 388-1200 Facsimile: (208) 388-l 300 mcc@ givenspursley. com Attorneys for SUEZ Water ldaho Inc. [30-174] r4403096.8 IN THE MATTER OF THE JOINT APPLICATION OF EAGLE WATER COMPANY, INC. AND SUEZ WATER IDAHO INC. FOR APPROVAL OF SALE AND ACQUISITION OF EAGLE WATER COMPANY, INC. ASSETS BY SUEZ WATER IDAHO INC. AND AMENDMENT OF CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY NO. I43 AND APPROVAL OF RATES AND CHARGES illl0 Pi*V lS fii{ t0: I 3 s$i0ru BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION Case Nos. SUZW-18-02 EAG-W-18-01 JOINT APPLICATION FOR APPROVAL OF ACQUISITION OF EAGLE WATER COMPANY, INC. ASSETS BY SUEZ WATER IDAHO INC. AND AMENDMENT OF CERTIFICATE OF PUBLIC CONVENIENCE AND NECES SITY NO. 143, APPROVAL OF RATES AND CHARGES AND REQUEST FOR MODIFIED PROCEDURE COME NOW Eagle Water Company, Inc. ("Eagle Water") and SUEZ Water Idaho Inc. ("SUEZ") collectively (the "Applicants") and in support of this Application respectfully show as follows: This Application is made pursuant to the requirements of Idaho Code $ $ 61-307 and 61 - 526 and Commission Rules of Procedure, IDAPA 31.01.01 .112,31.01.01 .052 and 31.01.01.125. The Applicants request Commission approval of: 1) the purchase by SUEZ of water service assets of Eagle Water; 2) amendment of SUEZ's certificate of public convenience and necessity ("CPCN") to incorporate Eagle Water's certificated service area and customers; 3) approval of I. APPLICATION AND REQUEST FOR MODIFIED PROCEDURE - 1 certain rate and ratemaking matters, including the right of SUEZ to include in rate base and future rate proceedings an acquisition adjustment in the amount of the purchase price plus reasonable acquisition costs; and 4) a rate increase for current Eagle Water customers as described in the testimony and exhibits of SUEZ witnesses submitted contemporaneously with this Application. Eagle Water and SUEZ each are water corporations and public utilities within the meaning of Idaho Code sections 6l - 125 and 6l-129 respectively and are subject to the jurisdiction of the Commission. I II. Eagle Water currently provides water service to approximately 4,200 customers within its certificated service area in the vicinity of Eagle, Idaho pursuant to Certificate of Public Convenience and Necessity No. 278 as amended. A map of the Eagle Water service area and key facilities to be acquired is attached hereto as Attachment 1. SUEZ currently provides water service to approximately 96,000 customers within its certificated service area in the greater Boise metropolitan area pursuant to Certificate of Public Convenience and Necessity No. 143 as amended. H2O Eagle Acquisition,LLC ("H2O Eagle") is a Wyoming limited liability company. Mr. N.L. Bangle is H2O Eagle's manager. APPLICATION AND REQUEST FOR MODIFIED PROCEDURE.2 II IV V Eagle Water and H2O Eagle have entered into an Asset Purchase Agreement (the "Eagle Water-H2O Eagle APA") whereby Eagle Water has agreed to sell andH2O Eagle has agreed to purchase, the Eagle Water assets. H2O Eagle's rights under the Eagle Water - HzO Eagle APA are assignable. VI. H2O Eagle and SUEZ have similarly entered into an Asset Purchase Agreement (the H2O Eagle - SUEZ APA") whereby H2O Eagle has agreed to sell and SUEZ has agreed to purchase, the Eagle Water assets to be acquired by H2O Eagle together with all of H2O Eagle's right to purchase the Eagle Water assets under the Eagle Water -H2O Eagle APA for a total purchase price of $10 Million. Subject to Commission approval Eagle Water, H2O Eagle and SUEZ contemplate a simultaneous closing of the respective purchases and sales such that SUEZ will become the ultimate purchaser and owner of the Eagle Water assets immediately upon closing. A true and correct copy of the H2O Eagle - SUEZ APA is attached hereto as Attachment 2 VII. Upon the simultaneous closing of the above transactions, SUEZ would take over all ownership and operations of the water system and servicing of customer and customer accounts. SUEZ anticipates that certain current Eagle Water employees may be employed to assist with the transition to SUEZ operation of the system or could become permanent SUEZ employees APPLICATION AND REQUEST FOR MODIFIED PROCEDURE - 3 depending on their relevant training, skills and experience and SUEZ's personnel requirements for continuing to operate the system. VIII SUEZ is proposing that rates for Eagle Water customers be adjusted over a three-year phase-in period to bring Eagle Water rates to parity with SUEZ rates, as shown in Exhibit 1. Schedule 2 to the testimony of Ms. Jarmila Cary submitted contemporaneously with this Application. Upon approval of this Application by the Commission SUEZ will file conforming tariffs pursuant to Commission RP 133. Ix. SUEZ's obligation to close the asset purchase is conditioned, among other things, upon Commission approval with conditions acceptable to SUEZ, including: 1) approval of the asset purchase and sale; 2) approval of an acquisition adjustment to rate base for the full amount of the purchase price and acquisition costs to be amortized over forty years; 3) approval of SUEZ's proposed three-year phased-in rate increase for Eagle Water customers to bring them into rate parity with SUEZ's existing customers; and 4) transfer of Eagle Water's service area and customers to SUEZ and amendment of SUEZ's CPCN to incorporate same. x. Eagle Water's owner, Robert DeShazo has determined that due to his age, the increasing complexity of regulatory requirements, necessary and costly system upgrades that should be implemented in the near-term and Eagle Water's limited access to capital to fund those upgrades, APPLICATION AND REQUEST FOR MODIFIED PROCEDURE - 4 now is the time to convey the company's water system to a qualified owner and operator to ensure an orderly succession ofservice. xI. SUEZ has performed extensive due diligence concerning the condition of Eagle Water's water system and company operations and books. SUEZ asserts that the purchase price represents a fair value of the assets to be purchased and was developed through arm's length negotiation with H2O Eagle. SUEZ and Eagle Water assert that the asset acquisition and associated expansion of SUEZ's CPCN and service territory is consistent with the public convenience and necessity, is in the public interest and will result in significant benefits to both Eagle Water and SUEZ customers by, among other things, realizing certain efficiencies in water service, water supply and operating costs. XIII SUEZ asserts that recognition of an acquisition adjustment of the full purchase price is appropriate under the circumstances and is justified for the reasons described in the testimony and exhibits of SUEZ witnesses submitted contemporaneously with this Application. xIV SUEZ and Eagle Water are filing concurrently herewith testimony and exhibits supporting this Application and the requested Commission approvals. SUEZ's sponsored XII. APPLICATION AND REQUEST FOR MODIFIED PROCEDURE . 5 testimony and exhibits provide an explanation of why the acquisition will be in the public interest, describe proposed system upgrades including type and timing of capital construction projects contemplated for the acquired water system and the avoided or postponed costs for currently planned SUEZ's water system expansion and upgrades through integration of service areas. SUEZ testimony also presents projected rate impact analysis for Eagle Water customers under acquisition and non-acquisition scenarios. Notice to affected customers will be accomplished by news media releases and individual notices mailed to each customer. Contemporaneously with this Application notice is being provided to Eagle Water customers by letter in the form attached hereto as Attachment 3, and SUEZ has issued a press release, a copy of which is attached hereto as Attachment 4. XVI The Applicants stand ready for immediate hearing if the Commission determines a hearing is necessary. XVII. Notices, orders and other communications concerning this Application should be addressed to: Michael C. Creamer, Esq. Givens Pursley LLP 601 W. Bannock St. Boise, ID 83702 P.O. Box 2720-83701 208-388-1200 (phone); 208-388-1 300 (fax) mcc@ givenspursley. com APPLICATION AND REQUEST FOR MODIFIED PROCEDURE . 6 XV Mr. Marshall Thompson SUEZ Water Idaho Inc. 8248 West Victory Road Boise, ID 83709 marshall. thompson@ suez. com Mr. Robert DeShazo Eagle Water Company, Inc. 188 West State Street Eagle, ID 83616 Mr. N.L. Bangle 188 West State Street Eagle, ID 83616 nban gl e@h2o-solutionsllc.net REQUEST FOR MODIFIED PROCEDURE SUEZ and Eagle Water do not believe a hearing is required to consider the issues presented by this Application and pursuant to Commission RP 201 et seq. they request that this matter be processed by Modified Procedure. If the Commission determines that a hearing is required, SUEZ and Eagle Water are prepared for immediate hearing, based on the Direct Testimony of Marshall Thompson, Cathy Cooper, Jarmila Cary and Robert DeShazo filed herewith. WHEREFORE SUEZ and Eagle Water respectfully request that the Commission enter its orders 1. Approving the sale and purchase of the Eagle Water assets as requested herein; 2. Approving an acquisition adjustment to SUEZ's rate base to be amortized over forty years equal to the asset purchase price together with SUEZ's reasonable acquisition costs through closing of the purchase; APPLICATION AND REQUEST FOR MODIFIED PROCEDURE . 7 3. Amending SUEZ's CPCN 143 to incorporate Eagle Water's certificated service area and customers and directing SUEZ to file a conforming amendment; 4. Approving SUEZ's proposed three-year phase-in of Eagle Water customer rates to match SUEZ's customer rates as requested herein and directing SUEZ to file conforming tariffs. 5. Cancelling Eagle Water CPCN No. 278 and tariffs; 6. Providing that service to customers in the Eagle Water area shall be made pursuant to SUEZ's Rules and Regulations Governing the Rendering of Water Service and Water Main Extensions and other applicable rules, schedules and tariffs on file with the Commission; and 7 . Granting such other relief as is appropriate under the circumstances. Isignatures on following page] APPLICATION AND REQUEST FOR MODIFIED PROCEDURE - 8 DArED trris ffday of November,2018. SUEZ Water Idaho Inc. By: C. Givens Pursley LLP Attorneys for SUEZ Water ldaho Inc. Eagle Water Company, Inc. Robert DeShazo, APPLICATION AND REQUEST FOR MODIFIED PROCEDURE - 9 Case Nos. STJZ-W-18-02 and EAG-W-I8-01 JOINT APPLICATION AND REQUEST FORMODIFIED PROCEDURE ATTACHMENT 1 Eacrp Wernn SnRvrcE Anne d g 2 :1I-uI z Y= oF E F6 llillll 4===*it -UUUtsFFXiiiTFFqr . r Od@@i6OF?F i; llzza<==ctuuFF 6 =3 ir,ioluo636UU.^UaaYaoo=ocrFroo@oGEXil4CUC tuFF< =e==db ETErao.HAhfE az.o t!J il- -oPl- L a? |JlU) *# Edtrl ur = EEgHil A x?fr;> \) zao =z l={ U E,E EIHP TEEH 2 5 J -n _.1 I ---1 Case Nos. SIJZ-W-I8-02 and EAG-W-18-01 JOINT APPLICATION AND REQUEST FORMODIFIED PROCEDURE ATTACHMENT 2 IJ2O EICIn-SUF-ZAPA ASSET PURCHASE AGREEMENT (Eagle Water Company) by and between H2O Eagle Acquisition LLC, a Wyoming limited liability company (the "&l!q"), and SUEZ Water Idaho Inc., an Idaho Corporation (the "BuygI") Dated Effective: September JO, ZOtS TABLE OF CONTENTS ARTICLE I DEFINITIONS AND CONSTRUCTION SECTION ARTICLE II PURCHASE AND SALE OF ASS8TS................. SECTION 2.()I PURCHASE AND SALE COVENANT.... SECTION 2.02 PURCHASED ASS8TS.. ....... SECTION 2.03 rcXCLUDED ASSETS SECTION 2.04 PURCHASE PRICE SECTION 2.05 ASSUMED OBLIGATIONS......,..., SECTTON 2.06 EMPLOYEES...,..,....... ARTICLE III DUE DILIGENCE ISSUES I 5 5 7 7I 9 9 9 0 0 J ., 1 SECTION 3.01 SECTION 3.02 SECTION 3.03 SECTION 3.04 SECTION 6.02 SECTION 6.03 SECTION 6.04 PROVISION OF INFORMATION BY SELLER. ....... DUE DILIGENCE DFTERMINATIONS CURRENT EVIDENCE OF TITLE. ENVIRONMENTAL PROVISIONS............... SECTION 3.05 NOTICE TO PROCEED WITH GOVERNIVIf,NT APPROVALS ........ 15 ARTICLE IV REPRESENTATIONS AND WARRANTIES,,.......... ....."...........16 SECTION 4.01 REPRESENTATIONS AND WARRANTIES OF SELLER........ I6 SECTION 4.02 REPRESENTATIONS AND WARRANTIES OF BUYER.......... I8 ARTICLE V ISSUANCE AND TRANSFER OF GOVERNMENTAL AUTHORIZATIONS 18 SECTTON 5.01 ISSUANCE AND TRANSFER OF GOVERNMENTAL AUTHORIZATTONS .......... t8 ARTICLE VI CONDTTIONS PRECEDENT TO THE BUYER'S OBLIGATION TO CLOSE AND ADDITIONAL COVENANTS.............. SECTION 6.0I SELLER'S PERFORMANCE SELLER'S REPRESENTATIONS AND WARRANTIES ADDITIONAL DOCUMENTS,......,. NO CONFLrCT............ 19 r9 19 19 20 20 20 21 2t SECTION 6.05 GOVERNMENTAL AUTHORIZATIONS., SECTION 6.06 ASSIGNMENT OF' AGREEMENT.,............ SECTION 6.07 AMENDMENTS TO EAGLE APA SECTION 6.08 ASSIGNMENT OF EAGLE APA........... ARTICLE VII CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE ..............21 SECTION 7.OI THE BUYER'S PERFORMANCE .,.......,21 SECTION 7.02 BUYER'S RBPRESENTATIONS AND WARRANTIES.,..... ...,., 21 Tlat,n oF CoNTENTS - l 14347456_l.docx [30-17a] ARTICLE VIII COVENANTS OF SELLER..,............. SECTION 8.()I OPERATION OF THE BUSINESS OF SELLER............,......,..... SECTION 8.02 NOTIFICATION......... SECTION 8.03 PAYMENT OF LIABILITIES SECTION 8.04 SELLER'S COVf,NANT................,.. ARTICLE IX CLOSING AND RELATED PROCEDURES AND ADJUSTMENTS ......,.24 SECTION 9.01 ESCROW, CLOSTNG DATE AND PLACE..................................21 SECTION 9.02 RECORDTNG FEES, TAXES AND TITLE INSURANCE....,..... 25 SECTION 9.03 ACCOUNTS RECEMBLE; ACCOUNTS PAYABLE; CUSTOMER DEPOSITS.......,,.........,..,..,,.,26 SECTION 9.04 CONNECTION CHARGES AND HOOKUP FEES. .,..",,..,,.,....,,,26 SECTION 9.05 COSTS AND PROFESSIONAL FEES......26 SECTION 9.06 RISK OF LOSS SECTION 9.07 CLOSTNG PROCEDURE.................... SECTION 9.08 DOCUMENTS AF'TER THE CLOSING ................28 ARTICLE X INDEMNITY AND ATTORNEYS FEES 22 22 23 24 24 ....27 ..............27 ARTICLE XI GENERAL PROVISIONS........... ,..........30 SECTION I 1.01 APPLICABLE LAW; JLJRISDICTION AND VENUE .......,...... 30 SECTION 11.02 NOTICE....... SECTION TO.OI INDEMNITY AND ATTORNEYS FEES... SECTION IO.(l2 ATTORNEYS FEES........ SECTION 11.03 ASSIGNMENT AND JOINDER.,.. SECTION I1.04 AMENDMENTS AND WAIVERS............ SECTION I1.05 ENTIRE AGREEMENT ..,...,...,...... SECTION 11.06 REMEDIES; TERMINATION EVENTS.. SECTION 11,07 REMEDIES; EFFECT OF TERMINATION SECTION I1.08 COUNTERPARTS.,.,........,. sEcTroN r1.09 SECTION HEADINGS ..................... SECTION II.I4 EXCLUSIVITY....... 29 29 29 30 3l 3l 31 3l 32 34 34 SECTION II.IO SEVERABILITY..........34 SECTION II.Il EXHIBITS AND SCHEDULES...... .,...,.34 sEcrroN 11.12 srocK ACQUISITION 34 SECTION II.I3 PUBLICITY .................... 35 ... 35 TABLE oF CONTENTS - II 14347456_1.docx [30-174] ASSET PURCHAS E AGREEMENT (Eagte Water Company) THIS ASSET PURCHASE AGREEMENT ("Asrecment") is made and entered into as of the }fdw of September, 2018 (the "Effectivc Date"), by and between H2o Eagle Acquisition LLC, a Wyoming limited liability company (the "Seller'), and Suez Water ldaho Inc., an Idaho Corporation (the "Buyer"). Seller and/or Buyer hereinafter may also be referred to individually as (the "Party'') and/or collectively as (the "Parties"). WITNISSETH: WHEREAS, Seller has the contractual right under the Eagle APA as hereinafter defined to purchase utility assets (the "Purchased Assets") that consist generally of water production, storage and distribution facilities, and more particularly described in Scction 2.0? below used to provide water utility service in the Service Area ("Scrvice Area") specified in Exhibit A; WHEREAS, Buyer desires to purchase, and Seller desires to sell, the Purchased Assets or, at Buyer's election, assigt the Eagle APA and the Seller's rights to acquire the Purchased Assets under the Eagle APA to Buyer, provided that the Purchase Price hereunder shall be paid to Seller net of payment of amounts due to Eagle under the Eagle APA, and upon the terms and conditions set fofth in this Agreement. NOW, TIIEREFORE, in consideration of the mutual covenants, conditions, representations and agreements contained herein, the Parties agree as follows: ARTICLE I DEFINITTONS AND CONSTRUCTION SECTION As used in this Agreanent, the following terms shall have the meanings as defined herein unless the context requires otherwise: ASSET PURCHASO AGREEMEI{T- I '14347456--1 docx [30-1741 "As$iunrnent" means tlie Assignment of the Eagle APA provided for in Sestion 9.01(AX2). "Closing" or "Closing Date" has the meaning set forth in Section 9.01 of this Agreement. "Customer Qcposits" means all funds or deposits required to be made by customers of the Utility System to Seller upon becoming a customer or by persons requesting extension of service and connection to the Utility System, including, customer advances and contributions in aid of construction where such connection or extension has not been made. Said funds are being held by Eagle and shall be transferred to Buyer at Closing. A listing of said Custoneer Deposits is attached hereto as Exhibit F and incorporated herein by this express ref'erence. Said list shall be updated at Closing to reflect additions to and/or subtractions from said listing between the Effective Datc and thc date of Closing, "Deposit" means the sum of One Hundred Thousand Dollars ($ 100,000.00) together with any interest earned therein and deposited with Escrow Agent as provided in SSction 2.04(A). "&glg" means Eagle Water Company, an Idaho corporation. "Eagle APA" means the Asset Purchase Agreement wherein the Party herein referred to as "Seller" is the Buyer and Eagle is thc Scller, a copy of which is attachcd hereto as Exhibit G and incorporated herein by this express reference and shall mean and include any amendments to such agreement made at Buyer's direction pursuant to Section 6.08. "Egsotltsn$" means all existing easements and/or rights-of-way necessary or convenient for ingress, egress, access to, or the location, operation and/or rnaintenance of the Purchased Assets, that are not within a plat or dedicated roadway, including but not limited to those Easements set forth in Exhibit B. ASSE.T PURCHASE AGREEMENT - 2 14347456 _1.docx [30-174] "Encunrbrarrcc" means any charge, claim, condition, equitable interest, lien, option, pledge, security interest, mortgage, right of way, easement. encroachment, servitude, right of first option, right of first refusal or similar restriction, including, but not limited to, any restriotion on use, voting (in the case of any security or equity interest), kansfer, receipt of income or exercise of any other attribute of ownership. "Escrow" means the escrow account established with the Escrow Agent for coordinating the Closing and receiving the documents for the Closing and disbursement of funds to Seller and Eagle for the purchase hereunder provided for and under the Eagle APA. "Escrow Agent" shall be the Title Company. "Escrow Instructions" means the escrow instructions provided to the Escrow Agent in customary fonn to carry out the terms of this Agreement and providing for a simultaneous closing under this Agreement with Seller and with Buyer and Eagle under the Eagle APA. "Exclu<lcd Assets" means those assets, properties and rights, tangible andior intangible, real and/or personal, listed in Exhibit C. "Fee Parcels" means the fee simple real property listed in Exhibit D, including any leased parcels to be converted to Fee Parcels at or prior to Closing. "Govemmental Authorization" means any final approval, license, certificate of public convenience and necessity, registration or final permit issued, granted, given or otherwise made available by or under the authority of any Governmental Body, "Govemmental Body" means any governmental authority of any nature, including but not limited to, the Idaho Public Utility Commission ("IPUC"), City of Eagle, Idaho, andL/or the Idaho Department of Environmental Quality ("IDEQ"). ASSET PURCHASE AGREEMENT . 3 14347456_'1 .docx [30-1 74] "l-lggkgp_Fee!" means the funds collected from new customers of the Utility System at or prior to initial connection to the Utility System in order to defray the cost of making utility service available. Any Hookup Fees held by Seller for hookups to occur after Closing shall be transferred to Buyer at Closing. Such Hookup Fees shall be shown on Exhibit F. "Penlitted R-eal Estate Encumbrances" shall mean all rights of way, easements and covenants of record pertaining to the Fee Parcels and the Easements so long as the same do not rnaterially irnpair the use, value or marketability of any Fee Parcel and Easement. Permitted Real Estate Encumbrances shall not include any equitable interest, lien, option, pledge, security interest, mortgage, right of first option, right of first refusal or similar restriction, including any restriction on voting (in the case of any security or equity interest), transfer, receipt of income or exercise of any other attribute of ownership. "Per$onal Property" means the pcrsonal properly that is owned and used by Eagle in operation of the Utility System as identified in Exhibit E. "Pulchased Assets" has the meaning set forth in Section 2.02 hereunder. "service Area" means the service area identified in Exhibit A. "Title Commitment" means the title insurance commitment with respect to the Fee Parcels and the Easements in an amount not to exceed the Purchase Price, issued by the Title Company comrnitting the Title Company to issue and deliver the Title Policy to Buyer upon compliance with the requirements stated in Schedule B, Section I thereof, subject to the terms and conditions contained therein. "Titlc Cornpanv" means TitleOne Corporation. ASSET PURCHASE AGREEMENT. 4 1 4347 456 _1.docx [30-1 74] "Title Policy" means the ALTA owner's policy of title insurance, issued by the Title Company in accordance with the Title Commitment, that meets the requirements of Sqctiqn 3,03 of this Agreement. , "Transaction Fee" means the sum of Ten Thousand Dollars ($10,000.00) as provided for in Section 2.04(el,Section 2.04 "Utilitv System" means (1) the Fee Parcels, (2) the Easements, and (3) the Personal Property used to provide utility service in the IPUC authorized Senice Area. "W4tcr Ri8.hts" means all State of Idaho water rights and permits associated with the Utility System, including, without limitation, the following: State of Idaho water right numbers: 63-7368, 63-7618, 63-9245, 63-11798, 63-12147 and 63- I 2559. ARTICLE II PURCHASE AND SALE OF ASSETS SECTION 2.01 PURCHASE AND SALE COVENANT. At Closing, Buyer shall purchase directly from Eagle, pursuant to the rights granted to Seller to assign the Eagle APA, and Eagle pursuant to its obligations and covenants under the Eagle APA, shall sell to Buyer the Purchased Assets, upon the terms and subject to the conditions set forth in this Agreement. Buyer, as defined in this Agreement, rvill become the Buyer under the Eagle APA pursuant to an assignment of the Eagle APA prior to or simultaneously with the purchase hereunder pursuant to the Assignrnent and Assumption Agreement attached hereto as Exhibit H. SECTION 2.02 PURCHASED ASSETS. (A) The Purchased Assets consist of the rights of Seller under the Eagle APA to purchase the foliowing: (l) The Fee Parcels described in Exhibit D hereto. ASsET PI.IRCHA.5E AGRtrEMENT - 5 'l 4347456_1 .docx [30-174] (2) The Easements, together with any other easement rights possessed by Seller at Closing, whether identified prior to or after Closing, including but not necessarily limited to those Easements identified in Exhibit B hereto if they are integral to the Utility Systan. (3) Any and all Govemmental Authorizations. (4) Any and all Personal Property, including, but not limited to, all water supply and distribution facilities, pumps, tanks, treatment plants, other facilities, transmission mains, distribution mains, supply pipes, valves, meters, meter boxes, service connections, equipment, vehicles, parts, tools, chemicals, office buildings and all other physical facilities, equipment, appurtenances and property installations used by and for the operation of the Utility System. and third-party warranties that relate to completed construction, or construction in the process of being completed. Personal Property includes, but is not necessarily limited to those items identified in Exhibit E hereto if they are integral to the Utility System. (5) All existing Customer Deposits made to and held by Eagle prior to the Closing. (6) All existing Hookup Fees collected and held by Eagle for customers not yet connectcd to the Utility Systcm as of Closing. (7) All existing Watcr Rights belonging to and held by Eagle. Any of the foregoing held in the name of any affiliate of Eagle or by Robert DeShazo and/or any other person shall be included in the foregoing and be subject to the terms and conditions hereof and the Eagle APA. (B) Promptly during the due diligence Inspection Penod, provided for in Section 3.02. the Seller shall cause Eagle to provide Buyer copies of all cwrent customer records, as-built ASSET PURCHASE AGREEVIENT - 6 1 4347 456_1.docx [30-1 74] surveys and infrastructure plans, plats, engineering and other drawings, designs, blueprints, plans and specifications, maintenance and operating manuals, engineering reports, calculations, studies, non-corporate accounting, and non-corporatc business records controlled by or in the possession of Eagle that rElate to the description and operation of the Utility System. SECTION 2.03 EXCLUDED ASSETS. Notwithstanding any other provision of this Agreement that may be construed to the contrary, the Purchased Assets do not include the Excluded Assets as shown in Exhibit C. SECTION 2.04 PURCHASE PRICE AND DEPOSIT. The purchase price (the "Purchase Pricc") for the Purchased Assets shall be TEN MILLION AND NO/100 US DOLLARS ($10,000,000.00), and is subject to prorations and adjustments set forth in this Agreement. The Purchase Price shall be payable by Buyer to Seller in immediately available funds at Closing, by wire transfer, pursuant to wire instructions to bc provided by Seller to Buyer andior Escrow Agent at or prior to Closing. Provided that as a condition to occur simultaneously with Buyer's delivery of the Purchase Price, Seller shall pay to Eagle, out of Escrow, the purchase price due to Eagle under the Eagle APA to consummate the Seller-Eagle transaction provided for therein. (A) Buycr will deliver a Deposit (the "Deposit") in the amount of ONE HUNDRED THOUSAND AND NO/I00 US DOLLARS ($100,000.00) to the Escrow Agent within three (3) Business Days following the Effective Date. Ten thousand dollars ($10,000.00) of the Deposit shall be deemed a non-refundable'oTransaction Fee" payable to Seller in any event and credited towards the Purchase Price as part of the Deposit at Closing as provided in subsection 2.04(C) below. Buyer will deliver the balance of the Purchase Price on or before the Closing Date. Escrow Agent will place ttre Deposit in a federally insured account on behalf of Seller and ASSET PURCHASE ACREEMENT . 7 14347456_1.docx [30-174] Buyer. Buyer will instruct Escrow Agent as to whether Buyer elects to have such account be interest-bearing. The Purchase Price will be paid to Seller at Closing pursuant to the Escrow lnstructions. (B) Disposition of the Deposit shall be as follows: (i) If Buyer terminates this Agreement under circumstances to which Buyer is expressly entitled as provided in this Agreement, the Deposit (less the Transaction Fee, as provided below) will be returned to Buyer; or (ii) if this Agreement is terminated and the Deposit is to be received by Seller as provided in this Agrcement, the Deposit will be paid to Seller; or (iii) if Closing occurs, the Deposit will be credited to Buyer, applied against the Purchase Price, and paid to Seller at Closing. (C) The Transaction Fee is the indepcndent consideration for the cxecution of this Agreement by Seller and the provision of the Diligence Period by Seller to Buyer. Upon any termination of this Agreement prior to Ciosing, the Transaction Fee will be deducted from the Deposit and paid by Escrow Agent to Seller. The Transaction Fee is earned by Seller as of the Effective Date of this Agreement and is non-refundable in all events, and any reference in this Agreement to a return of the Deposit to Buyer will rncan such amount less the Transaction Fee provided however, that if Closing occurs, the Transaction Fee will be included in the Deposit amount credited to Buyer and applied to the Purchase Price as provided above. (D) This Agreement, including the Escrow Instructions, will oonstitute the instructions fbr the Escrow Agent's handling of the purchase and sale transaction contemplated herein and under the Eagle APA. Seller and Buycr will execute such supplemcntal escrow instructions as may reasonably be required by Escrow Agent to enable Escrow Agent to comply with the terms and conditions of this Agreement. lf any conflict exists between this Agreement and the provisions of any supplemental escrow instructions, the terms of this Agreement will ASSET PURCHASE AGREEMENT - 8 14347456_1.docx [30-1 74] control unless a contrary intent is expressly indicated in the supplemental instructions and such supplemental instructions are signed by both Buyer and Seller. SECTION 2.05 ASSUMED OBLIGATIONS. With the sole exception of Buyer's agreement to provide water service to individual customers through the Utility System after the Closirrg, Buyer shall not assume and shall not be liable for any debt, liabilities or contractual obligations of Seller or any other party of any nature whatsoever. Pursuant to the Eagle APA, Eagle shall remain fully and solely liable for any and all debts, obligations or liabilities arising from or conditions existing prior to and from Eagle's operation of the Utility System prior to the Closing. SECTION 2.06 EMPLOYEES . Buyer may, after Closing, hire any employces of Seller that it desires to hire. Buyer shall be responsible for obtaining employment applications from employees it desires to hire. ARTTCLE III DUE DILIGENCE ISSUES SECTION 3.OI PROVISION OF INF'ORMATION BY SELLER. (A) Seller has provided or will cause Eagle to provide to Buyer, within l0 days after the Effective Date, an inventory of equipment, parls and other personal property used by Eagle in connection with and for the operation of the Utility System as of the Effective Date to be included in this Aggeement as Exhibit E. (B) After the Effective Date, and after reasonable advance notice, Seller shall cause Eagle to cooperate 'w,ith Buyer in providing updated information and access to all aspects of the Utility System by Buyer's representatives(s) during normal business hours. (C) After the Effective Date, and after reasonable advance notice, Seller shall make available and cause Eagle to make available any existing plats, surveys, plans or specifications ASSE,T. PURCHASE AGRaEMENT - 9 1 4347 456_1.dacx [30-1 74] for the Utility System in Seller's or Eagle's possession to Buyer, andror its representatives for inspection during normal business hours. (D) Within fir,e (5) days after the Effective Date Seller shall provide Buyer with a resolution of all of its Shareholder's approving this Agreement and the transaction piovided for herein. SECTION 3.02 DUE DILIGENCE DFTERMINATIONS. (A) Buyer shall have until September 28, 2018 (the "lnspection Period") to conduct its duc diligence. Buycr shall have until the date that is twenty-five (25) business days after the expiration of the Inspection Period (the "Due Dili,rcrrce Ter:mination Datq") herein to terminate this Agreement at its sole discretion, for any reason or no reason, by delivering a Notice of Termination as provided in Section I 1.0? of this Agreement; otherwise, Buyer and Seller shall proceed to obtain any and all Government Approvals under Section 3.05 and Section 5.01. Upon termination of this Agreement under Scction 3.02 herein, neither Party to this Agreement shall have any further liability or obligation to the other pertaining to this Agreement. (B) The time period for the Due Diligence Termination Date may be extended by Buyer for up to three (3) fifteen (15) day periods by giving written Notice to Seller, on or before the Due Diligence Termination Date as it may be extended to complete Title Review, surveys, environmental and/or to satisfo the conditions precedent under Article VL SECTION 3.03 CURRENT EVIDENCE OF TITLE. (A) Within ten (10) days after the Effective Date, and at Sellsr's expense, Seller shall furnish or have delivered to Buyer, from the Title Company, the following information: (l) A Title Commitment issued by the Title Company (the "Title eomlnitment") to insure title to the Fee Parcels and the Easements of record in an amount not to ASSf,T PURCHASE ACRf,EMENT . IO I 4347 456 -1.docx [30-1 7al exceed the Purchase Price, naming Buyer as the proposed insured and having the effective date as set forth therein, wherein the Title Company will have agreed to issue at Closing an ALTA form owner's title insurance policy, with Idaho modifications and extended coverage at Buyer's election; and (2\ Copies of all recorded documents listed as special Schedule B exceptions thereunder (the "Recorded Docu$cnts"), (3) Unifonn Commercial Code ("UCC") search for all LICC security interests that rnay apply to any of the Purchased Assets. (4) Judgment search to determine if there are any judgments against Eagle and/or liens against any of the Purchased Assets. (B) The Title Commitment shall include the Title Company's requirements for issuing the Title Policy, which shall be met by Seller as provided in Scction 3.03{E) herein on or before the Closing Date (including those requirements that must be met by releasing or satisfoing monetary Encumbrances, but excluding Encumbrances that will remain after Closing as agreed to by the Buyer). (C) If any of the following occur, they shall constitute a Title Obiection: (1) The Title Commitment or other evidence of title or search of the appropriate real estate records discloses that any party other than Seller or Eagle has title to the insured estate covered by the Title Commitment; (2) Any title exception is disclosed in Schedule B to any Title Commitment that is not one of the Perrnitted Real Estate Encumbrances; or (3) Any current survey discloses any matter that Buyer reasonably believes could materially and adversely affect Buyer's material use and enjoy,rnent of the Fee Parcels and AssE.T PURCHASE AGREEMENT - II 1 4347 456 _1.docx [30-1 74] Easements described therein; in such casc, Buyer shall notify Seller in writing of such matters no later than l5 days prior to the Closing Date. (D) Seller shall cause Eagle to use its best efforts to cure each Title Objection and take all steps required by the Title Company to eliminate each Title Objcction as an exception to the Title Commitment. Any Title Objection that the Title Company is willing to insure, on terms acceptable to Seller and Buyer, is herein ret-erred to as an "lnsutEd_E-xespliqn." The lnsured Exceptions acceptable to Buyer, together with any title exception to the Title Commitment or matters disclosed by any srrvey and not objected to by thc Buyer in the manner afbresaid, shall be deemed to be acceptable to Buyer. In the event Seller is unable to cure or cause a cure of a Title Objection and/or Buyer objects to an lnsured Exception, Buyer shall have the right to terminatc this Agreernent and shall have no liability or further obligation under this Agrcement. (E) Seller shall cause Eagle to comply with the requirements of [Schedule B Section ll of the Title Commitment. (F) Buyer shall have the right, but not the obligation, to do such surveys on the Fee Parcels as Buyer desires. Surveys procured by Buyer shal1 be at the sole cost and expense of Buyer. (G) If Buyer desires to have any standard survey exceptions deleted or modified in the Title Policy, Buyer shall deliver to the Title Company, no later than l5 days prior to the Closing Date, properly ccrlified and current original surveys of the specified Fee Parsels that comply with Idaho law. ASSET PURCHASE ACREEMENT - 12 14347456_1.docx [30-174] SECTION3.()4 ENVIRONMENTALPROVISIONS. (A) For purposes of this Section: (1) ".llazardous-MglEd-alr" means any substance or material regulated by any federal, state or local governrnental entity under any Environmental Law as a hazardous material, hazardous substance, hazardous waste, pollutant, contaminant, toxic waste, toxic substance or words of similar import, including petroleum and petroleum products, by-products or breakdown products; (2) "0nvi{onrncntal Lavy$" means any statute, law. regulation, ordinance. injunction, judgment, order, or other decree of any goverrunental authority pertaining to the protection of the environment. including the Federal Clean Water Act - 33 U.S.C. $ l25l et seq. (19'72), the Comprehcnsive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act, the Federal Water Pollution Control Act, the Oil Pollution Act of 1990, Toxic Substances Control Act, Superfund Amendment and Reauthorization A<;t of 1986, the Resource Conservation alid Recovery Act, and any comparable state statute, law, regulation, ordinance, injunction, judgment, order, or other decree. Any reference to legislative acts or regulations shall be deemed to include all amendments thereto and all regulations, orders, decrees, judgments or notices issued thereunder. (B) Seller will cause Eagle to warrant that it has obtained all environmental permits and other Govemrnental Authorizations that are required in connection with the business and operation of the Utility System. (C) Seller will cause Eagle to warrant that the Utility System is in fuIl compliance with all applicable Environmental Laws and Company-held environmental permits. Seller has no ASSE PURCHASE AGRTiEMEN,T - I3 1 4347 456 _1.docx [30- 1 74] knowledge that the Utility Systern is not in full compliance with all applicable Environmental Laws and Company-held environmental permits. (D) Seller will cause Eagle to warrant that it has not received notice of any violation, allegcd violation or liability arising under any applicable federal, state or local statutes, laws and/or regulations (including, without limitation, any applicable environmental, building, zoning, or other law, ordinance or regulation) materially or adversely affbcting the Purchased Assets or Utility System, and Seller warrants to Buyer that it has no knowledge of any alleged violation, violation or liability arising under the foregoing. (E) Seller has no knou4edge of, and will cause Eagle to warrant that there are not, Hazardous Materials present around, on or in the environment of the Utility System that are not in compliance with applicable Environmental Laws, including, but not limited to, any hazardous Materials contained in barrels, aboveground or underground storage tanks. equipment (whether moveable or fixed) or other containers, either temporary or permanent. Sellcr will cause Eagle to wanant that it has not disposed of any Hazardous Materials on the Fee Parcels or Easements, nor has Eagle removed Hazardous Materials from the Fee Parcels or Easements, except as provided by law. (F) Buyer, at its expense, lnay perform assessments, as it deems appropriate, including Phase I Environmental Site Assessments (ESA) pursuant to applicable ASTM standards and Phase II Environmental Site Assessments for recognized environmental conserns identified in the Phase I Environmental Site Assessments. Seller shall cause Eagle to cooperate with Buyer and/or its agents by providing reasonable access to the Utility System and Fee Parcels so that Buyer and/or its agents may conduct any Environmental Site Assessments Buyer deems necessary. ASSET PURCHASE AGREE]UENT - 14 1 4347 456_1 .docx [30-1 741 (G) If the ESA reveals Hazardous Materials on the Fee Parcels that require remedial action, Buyer, at its sole discretion, shall cither (a) demand that Seller causc Eaglc to take prompt action as necessary to expeditiously remediate the rcported Hazardous Materials and provide the Buyer with copies of all documentation verifying that all remediation has occurred and applicable regulatory requirements have been satisfied; (b) cause Seller to attempt to negotiate with Eagle a lesser Purchase Price for the Purchased Assets and proceed to Closing under the terms contained herein; provrded, however, if Sellcr (and Eagle) and Buyer are unable to negotiate in good faith a lesser Purchase Price within twenty (20) days of Buyer's first remediation offer to Seller, Buyer may terminate this Agreement; or (c) terminate this Agreement. Eagle shall be required to remediate under this Scction 3.04(CXa) unless the cost is estimated to exceed $100,000.00, in which case Eagle shall have the option to terminate the Eagle APA or renegotiate the purchase price in accordance with Scction 3.04(C) or (b). Upon any termination under this Soction 1.04, Seller and Buyer shall have no further liability or obligation to each other under this Agreement. SECTION 3.05 NOTICE TO PROCEED WITH . GOVERNMENT APPROVALS. Upon completion of the Inspection Period and if Buyer does not terminate this Agreement under Section 3.02, Seller shall provide written notice to Eagle of its intent to assign this Agreement to Buyer and coordinate and cause Eagle to proceed to seek the Governmental Approvals pursuant to Sectio[ 5.01. Seller shall assist and coordinate the Govemmental Approval process on Eagle's behalf. ASSE'I. PIJRCTIASE AGR}]EMEN.T. I 5 1 4347 456 _1.docx [30-1 74] ARTICLE IV REPRESENTATIONS AND WARRANTIES SECTION 4.OI REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and warrants to Buyer as follows: (A) Seller is duly organized, validly existing and has an active status under the laws of the State of Wyoming. Seller has the power and authority to enter into this Agreement and to perform the terms and conditions of this Agreement. (B) There are no pending or tkeatEned legal actions, suits, mediations, arbitrations, or other legal or administrative proccedings pending or threatened against Seller or Eagle that could affect the disposition of the Purchased Assets in any way or could prevent consummation of the transactions contemplated by this Agreement or the Eagle APA. Furthermore, Seller has no knowledge that there exists any fact or facts that with notice or the passage of time may result in any action, suit, mediation, arbitration, or other proceedings that might result in any adverse change in the Purchased Assets. (C) Seller has no knowledge that Eagle is in default with any Governmental Authority or under any Govemmental Authorization pertaining to the operation of the Utility System or disposition of the Purchased Assets. Additionally, the Scller has not received notice of any claim of default with respect to any Governmental Authorization. Seller has no knowledge that with notice or the passage of time that Eagle is in default with rcspect to any judgment, order, writ, verdict, injunction, decree or award applicable to it or any court or other govcrnment instrumentality or arbitrator having jurisdiction over it as pertaining to the operation of the Utility System or the Purchased Assets. ASSET PURCHASE AGREEMENT - I6 14347456_1.docx [30-174] (D) The execution and perfonnance of this Agreement by Seller does not and will not violate or result in the breach of any term, or condition, or require the consent of any person not a Party hereto under: (i) the by-laws of Seller andior (ii) any material mortgage, indenture, contract, lease, license or other instrument, document or understanding, oral or lritten, to which the Seller is a party or subject. (E) Seller has no knowledge that Eagle is in default under any contract, agreement, lease or other instrument to which it, the Utility System or the Purchased Assets are bound. Seller has no knowledge of any outstanding debts or accounts payable relating to the Purchased Assets to which Eagle is a party. (F) That Seller as Buyer, under the Eagle APA shall assign its rights and obligations as Buyer under the Eagle APA as provided hereunder, (G) Seller warrants that as Buyer under the Eagle APA Seller has the full right, power and ability to assign, and will assign to Buyer at Closing. Seller's rights and obligations under the Eagle APA free and clear of all liens, claims and encumbrances. Seller further warrants that it has not made any previous assignment of, or otherwise encumbered, the Eagle APA or any interest in or part thereof. (H) Without limiting the gencrality of any other provision of this Scction 4.0lSection 4.01, Seller warrants that as of the Effective Date and as of Closing, Seller is the Buyer under the Eagle APA, the Eagle APA is a valid and binding agreement and the obligations of Seller and Eagle are enforceable in accordance with its terms, and Seller has full right, power and ability to assign to Buyer its rights and obligations to Buyer under the Eagle APA at or prior to Closing as provided hereunder. AssET PURCHASE AGREEMEN - I7 '14347456_1.docx [30-1741 (l) Seller has not dealt with a broker, salesman, or flnder in connection with any part of the transaction conternplatcd by this Agreement, and, insofar as it knows, no brokcr, salesman or other person is entitled to any commission or fee with rcspect to said transaction. SECTION 4.02 REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and warrants to Seller as follows: (A) Buyer is duly organized, validly existing and has an active status under the lau,s of the State of ldaho. Buyer has the power and authority to enter into this Agreement and to perform the terms and conditions herein. (B) Buyer is not subject to, nor a party to any action. suit, claim or other legal proceeding, legal requirement or any othcr restriction of any kind or character that would prevcnt consummation of the transactions contemplated by this Agreement. (C) The execution and performance of this Agreement by Buyer does not and will not violate or result in the breach of any term or condition, or require the consent ofany person not a parly hereto under: (i) the bylaws of Buyer; (ii) any rnaterial mortgage, indenture, contract, lease, license or other instrument, document, agreement or understanding, oral or written, to which the Buyer is a party or subject. ARTICLE V ISSUANCE AND TRANSFER OF GOVERNMENTAL AUTHORIZATIONS SECTION 5.01 ISSUANCE AND TRANSFER OF GOVERNMENTAL AUTHORIZATIONS. Within ten (10) days aftcr the Due Diligence Termination Date or earlier at Buyer's request, Seller shall cause Eagle, in conjunction with Buyer, to jointly apply for, and thereafter diligently seek and pursue, the issuance, cancellation and/or transfer as the case may be, of all Governmental Authorizations necessary for the transfer of the Purchased Asscts to Buyer and to operate the Utility System. Buyer and Eagle shall be responsible fbr their ASSE'T PURCHASA AGREEMEXT . 18 14347456_1.docx [30-174] own f'ees and costs in this regard- Any filing fees inourred in seeking such govemmental authorizations shall be split evenly between Eagle and Buyer. ARTICLE VI CONDITIONS PRECEDENT TO THE BUYER'S OBLIGATION TO CLOSE AI\D ADDITIONAL COVENANTS Buyer's obligation to purchase the Purchased Assets and to take any and all other actions required to be taken by Buyer at the Closing is subject to the satisfaction, at or prior to the Closing of each of the following conditions, any of which may be waived by the Buyer, in whole or in part: SECTION 6.0f SELLER'S PERFORMANCI. Al1 of the covenants and obligations that Seller is required to perform or to comply with pursuant to this Agreement and those covenants and obligations that Eagle is required to perform under the Eagle APA at or prior to the Closing (considered collectively). and each of these covenants and obligations (considered individually) shall have been duly performed and complied with in all material respects. SECTION 6.02 SELLER'S REPRESENTATIONS AND WARRANTIES. AI1 representations and warranties made by Seller in this Agreement and by Bagle under the Eagle APA shall be true, correct and complete as of the Effective Date, and no breach or violation of such representations and warranties shall have occurred from the Effective Date up to and including the Closing Date. SECTION 6.03 ADDITIONAL DOCUMENTS. Seller and Eagle shall have caused the documents and instruments required by this Agreement, and the Eagle APA, and the following documents to be delivered to the Escrow Agent for closing in a form reasonably satisfactory to the Buyer: (A) Resolution reflecting approval of this Agreement by Sellerl ASSET PURCHASE AGRf,EMEIT - I9 1 4347 456_1.docx [30-1 74] (B) Resolution of Eagle reflecting approval of the Eagle APA; (C) Such other docurnents as Buyer may reasonably requcst for the purpose ot': (l) Evidencing the performance by Seller or Eagle as the case may be undcr the Eagle APA, or the compliurce by Seller or Eagle as the casc may be under the Eagle APA, any covenant or obligation required to be performed or complied with by Seller or Eagle as the case rnay be under the Eagle APA; and/or (2) Evidencing the release of all liens, security interests, and any other encumbrance or encumbrances other than Permitted Real Estate Encumbrances. SECTION 6.04 NO CONFLICT. Neither the consummation nor the performance of this Agreement or the Eagle APA (as assignee of Seller) will, directly or indirectly, materially contravene or conflict with or result in a material violation of or cause Buyer to suffbr any material adverse consequence under any applicable Governmental Authorization or other legal order. SECTION6.05 GOVERNMENTAL AUTHORIZATIONS. All Governmental Authorizations shall have been issued, cancelled or transferred, as the case may be, in accordance with Section 5.01 of this Agreement under terms satisfactory to Buyer at its sole discretion. SECTION 6.06 ASSIGNMENT OF AGREEMENT. The Buyer shall have the right to assigrr this Agreement at Buyer's sole discretion and at any time prior to Closing to a parent, subsidiary or affiliate of Buyer without Seller's consent, and Buyer may assigrr this Agreernent to any other party with the prior written consent of Seller, which conscnt shall not be unreasonably withheld. ASSET PURCHASE AGR.EEMENT - 20 14347456_1,docx [30-174] SECTION 6.07 AMENDMENTS TO EAGLE APA. Between now and the Closing Date Seller shall, at Buyer's direction, cause the Eagle APA to be amended to conform with, in substance, including, without limitation, the timing of this Agrccmcnt. Such amendment shall also be a condition to Closing. SECTION 6.08 ASSIGNMENT OF EAGLE APA. Buyer shall have the right to rcquire Seller to assign to Buyer the Eagle APA at any time after the Due Diligence Termination Date and in any event it shall be a condition that the Eagle APA shall be assigned to Buyer at Closing. ARTICLE VII CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE Seller's obligation to sell the Purchased Assets and to take any and all other actions required to be taken by Seller at the Closing is subject to its satisfaction. at or prior to the Closing, each of the following conditions (any of which may be waived by Seller in whole or in pa(): SECTION 7.01 THE BUYER'S PERFORMANCE. Al1 of the covenants and obligations that Buyer is required to perform or to comply with pursuant to this Agreement at or prior to the Closing (considered collectively); and each of these covenants and obligations (considered individually), shall have been performcd and complied with in all material respects. SECTION 7.02 BUYER'S REPRESENTATIONS AND WARRANTIES. AI1 representations and warranties made by Buyer in this Agreement shall be true, correct and complete as of the Effective Date, and no breach or violation of such representations and warranties shall have occurred from the Effective Date up to and ir:cluding the Closing Date. ASS8.I PURCHASI AGREEMf,NT - 2I 14347456_1.docx [30-1 74] ARTICLE VIII COVENAIITS OF SELLER SECTION 8.01 OPERATION OF THE BUSINESS On SELLER. Between the Effectivc Date and the Closing, Seller shall require performance under the Eagle APA to cause Eagle to: (A) Conduct its business in the ordinary course of business consistent with past practice; (B) Confer with Buyer prior to implementing any operational decisions that might change, in any way. the disposition of the Purchased Assets and/or operation relating to the Utility System of a material nature; (C) Maintain the Purchased Assets in a state of repair and condition that complies with legal requirements and is consistent with the requiranents and nonnal conduct of Seller's business; (D) Comply with all legal requirements and contractual obligations applicable to the operations of Eagle's business; (E) Use its best efforts to maintain its relationship and good-will with any and all of its suppliers, customers and/or any other person or entity with which it has a business relationship; (F) Cooperate with Buyer and assist Buyer and/or Buyer's agent(s) in identifying the Govemmental Authorizations required by Buyer to operate the business frorn and after the Closing Date and either (i) transfening existing Governmental Authorizations of Eagle to Buyer, where permissible, or assisting Buyer in obtaining new Governmental Authorizations; ASSET PURCHASE AGREEMENT . 22 14347 456_1.dacx [30-1 74] (G) Upon request from time to tirne, execute and deliver documents, make all truthful oaths, testify in any proceedings, whether before or after Closing, and do all other acts that may be reasonably necessary to consummate this Agreement, all without any further consideration; (H) Maintain and make available for review by Buyer all books and records of Eagle relating to Eagle's business in the ordinary course ofbusiness; (I) Notify and consult with Buyer pnor to the initiation, development, or execution of any plans for expansion of or improvements to the Utility System; (J) Cooperate with Buyer in sending any customer notices that, in Buyer's judgment are necessary or desirable in connection with the transactions contemplated herein; (K) Not allow the levels of raw materials, supplies or other materials included in the Purchased Assets to vary materially from the levels customarily maintained; (L) Not make any rnaterial modification to any Governmental Authorization that relates to the Purchased Assets; and (M) Not enter into any agr€ements, contracts, letters of intent or understanding or other documents or modiff, terminate or assign any existing agreements, contracts, letters of intent or understanding or other documents with Eagle (including any shareholder of Eagle) without Buyer's prior written consent and Seller will give its best efforts to prevent Eagle from doing any of the tbregoing. SBCTION 8.02 NOTIFICATION. Between the Effective Date and Closing, Seller shall promptly notify Buyer, in writing, if it becomes aware of (a) any fact or condition that causes or constitutes a breach of this Agreement or the Eagle APA, (b) the occurrcnce after the Effective Date of any fact or condition that would or be reasonably likcly to (except as expressly contemplated by this Agreement) causc or constitute a breach of this Agreement or the Eagle ASSET PURCHASE AGREEMENT - 23 14347456_1.docx [30-1 74] APA, or (c) any material damage or destruction to the Purchased Assets. During the same period, Seller also shall prornptly notify the Buyer of the occurrencc of any breach of any covenant of Seller in this Agreement or the Eagle APA or the occurrence of any event that may make the satisfaction of the conditions in this Agreement impossible or unlikely. SECTION 8.03 PAYMENT OF LIABILITTES. Seller shall cause Eagle to pay or otherwise satisfy in the ordinary course of business all of its liabilities and obligations as they come due. SECTION 8.04 SELLER'S COVENANT. Seller covenants that at all times during the term of this Agreement it shall take all actions and perform all requirements of the Buyer under the Eagle APA so as to maintain such agreement in fu1l force and effect. ARTICLE IX CLOSING AND RELATED PROCEDURES AND ADJUSTI\TENTS SECTION 9.OI ESCROW, CLOSING DATE AND PLACE. (A) Within three (3) business days of the Effective Date, Buyer and Seller shall open Escrow with the Escrow Agent. (l) The Parties shall execute the Escrow Instructions in customary form to cany out the tenns of this Agreement and providing fbr a sirnultaneous closing under this Agreement with Seller and with Buyer and Eagle under the Eagle APA. (2\ Seller shall deposit a duly executed Assignment of Asset Purchase Agreement in the form of Exhibit G attached hereto and incorporated herein by this reference assigning the Eagle APA to Buyer. (3) Seller shall deposit an original of the Eagle APA, (B) On or before the Closing Date, Buyer and Seller shall deposit in escrow with Escrow Agent all instruments, documents and monies (payable in cash by wire funds or official AssET PTTRCHASE AGREEMENT - 24 1 4347 456 _1.docx 130-17 4l bank check), and closing instructions necessary to complete the transaction in accordance with this Agreement. The Escrow Agent's closing fees shall be equally divided between Seller and Buyer. AIl other expenses not specifically referenced in this Agreement and incurred by Seller or Buyer with respect to the transactions set forth herein shall be borne and paid exclusively by the Party incurring the same, without reimbursement. (C) The Closing shall he held at the office of thc Closing Escrow Agent within ten (10) days after satisfaction of the conditions under Articlc Vl, or such other date mutually acceptable to Seller and Buyer but no later than twenty 120) days after receipt of Final Govemmental Authorizations and other conditions precedent under Arriclc Yl (the "Closilu Date"). SECTION 9.02 RECORDING FEES, TAXES AND TrrLE TNSURANCE. (A) Fees to record the deeds and any other instruments necessary to deliver title to Buyer shall be paid by Buyer. (B) To the extent that taxes or other charges are due and payable with respect to the deeds and/or other instruments necessary to deliver title to the Purchased Assets to Buyer, said transfer taxes shall be paid by Buyer. Any income taxes due and payable by Seller as a result of the sale of the Purchased Assets shall be paid by Seller. (C) The cost of the Title Policy, standard coverage, shall be paid by Seller, the additional cost ofextended coverage and any endorsements requested by Buyer shall be paid by Buyer. ASSET PURCHASE AGREEMEIT - 25 14347456_'1.docx [30-1 74] SECTION 9.03 ACCOUN'I'S RECEIVABLE; ACCOUNTS PAYABLE; CUSTOMER DEPOSITS. (A) All accounts receivable generated for services provided to customers prior to the Closing Date shall belong to Seller and Seller shall have the right and obligation to collect such accounts receivable. All accounts receivable generated for services provided to customers on and after the Closing Date shall belong to Buyer and Buyer shall have the right and obligation to collect such accounts receivable. (B) All bills for services, materials and supplies rendered in connection with the operation of the Utility Systern prior to the Closing Date ("Accounts Payablc"), shall be paid by Seller. (C) Seller shall be responsible for all ad valorcm or property taxes, and utilities charges prorated through the Closing Date. Taxes due thereafter, if any, shall be paid by Buyer. SECTION 9.04 CONNECTION CHARGES AND HOOKUP FEES. (A) Customer Deposits and Hookup Fees collected by Eagle frorn customers who, prior to the Closing Date have not been hooked up to the t/tility System or otherwise received the services tbr which such customer funds were collected, shall be a Purchased Asset. (B) Hookup Fees collected from and after Closing shall be Buyer's sole and separate property. SECTION 9.05 COSTS AND PROFESSIONAL FEES. (A) Each Party shall be responsible for securing its own counsel and/or advisor(s) for representation in connection with the negotiation of this Agreement and all other matters associated with perfonnance, cancellation or closing hereunder unless otherwise specified herein. Each Party shall be responsible for the payment of its own attomeys, bankers, engineers, ASSET PURCHASE AGREEMENT - 26 14347456_1.docx [30-174] accountants, and othcr professional advisors or consultants in connection herewith. Buyer will be responsible for the recording of the deeds and other instruments necessary to deliver title to Buyer. SECTION 9.06 RISK OF' L0SS. At all times prior to and through the timc of Closing, Seller shall cause Eagle to maintain adequate fire and extended insurance coverage for the cost of any replacement or repairs to the Purchased Assets that may be required as a result of casualty damage. Repairs or replacements must be of equal or better quality than existed prior to the loss or damage. The risk of loss to the Utility System prior to Closing shall be bome by Seller (and Eagle). The risk of loss to the Utility System alter Closing shall be borne by Buyer. SECTION 9.07 CLOSING PROCEDURE. (A) On or prior to the Closing Date, Seller and Buyer shall cause Eagle to execute all documents necessary to close the transaction. (B) The Assignment shall be delivered to Buyer and this Closing shall occur simultaneously with the Closing under the Eagle APA. (C) At Closing, Seller or Eagle (as the case may be under the Eagle APA) shall execute or cause to be executed and delivered to the Closing the following documents in final fbrm acceptable to Buyer, together with any exhibits or appendices ("Transfcr Docurt:cnts"): (1) General warranty deed(s) fbr the conveyance of Fes Parcels and the Water Right to be conveyed; (2) Assignment of Easements; (3) If necessary, general assigpment of any Governmental Authorizations; (1) Bills of Sale or other documents of assignment and transfer, with full warranties of title to the personal property portion of Purchased Assets; ASSET PURCHASO AGRE,EMENT - 27 14347456_'l.docx [30-1 741 (5) Post-closing agreemcnts, affidavits, assignments, certificates, estoppel certificates, corrective instruments, releases, satisfactions or terminations necessary or required pursuant to this Agreement; (6) Title Policy consistent with Section 3.03 of this Agreement; (7) Non-foreign affidavit; (8) Any aflidavits, assignments, certificates. estoppel certificates, corrective instruments, releases, satisfactions, terminations or waivers necessary to close, including, but not limited to a no lien affidavit, a "gap" affidavit and those instruments identified by the Title Company insuring the Fee Parcels; (9) Documents, in a form reasonably satisfactory to the Buyer and the Title Company, evidencing the release of all liens, security interests, and other encumbrances other than Permitted Real Estate Encumbrances. SECTION 9.08 DOCUMENTS AFTER THE CLOSING. From time-to-tirne after the Closing, each Party hereto shall, upon request of the other, execut€, acknowledge and deliver, or shall cause to be executed, acknowledged and delivered, all such further acts, deeds, assignments, bills of sale, transfers or other documentation for (l) confirming or correcting title in the name of Buyer or its successors) or perfecting possession by Buyer or its successor(s) of any or all of the Purchased Assets, including the establishment of a record of Easements without resort to litigation, expenditure of monies or other extraordinary means, for all facilities that are a part of the Utility System in existence or use at the time of Closing, or (2) otherwise fulfilling the obligations of the Parties hereunder and to facilitate the transition of services to customers and operation of the Utility System. Furlher, from time-to-time after Closing, should the Parties discover that certain land parcels, Easements, or other rights owned or enjoyed by Seller prior to ASSET PURCHASE ACREEMEXT - 28 14347456_1.docx [30-1741 Closing and necessary to the proper operation and maintenance of the Utility System were not included in the Appendices hereto, and thus not transferred to the Buyer or its successor(s) at Closing in accordance with this Agreement, then the Parties agree that Seller shall execute or cause to be executed the documents including, but not limited to, deedso easements and bills of sale necessary to convey such ownership or rights to Buyer or its predecessor(s), at no cost to Buyer, provided such conveyances may be accomplished without resofl to htigation, expenditure of monies or other extraordinary means. ARTICLE X INDEMNITY AND ATTORNEYS FEES SECTION 10.01 INDEMNITY AND ATTORNEYS FEES. Seller shall cause Eaglc to agree to indemnify (or defend at Buyer's solc option) Buyer, its successors and assigns, and hold them harmless against any loss. damage, liability, expense or cost arising out of or attributable to: I ) any act or omission of Seller or Eagle or its agents, employees or contractors relating to Eagle's ownership, maintenance, or operation of the Utility System prior to Closing, or 2) any misrepresentation or breach of any representation,.warranty or covenant on the part of Seller under this Agreement or Eagle under the Eagle APA. SECTION 10.02 ATTORNEYS FEES. In the event litigation is necessary to resolve any dispute arising under this Agreement, the substantially prevailing party shall be entitled to recover from the non-prevailing party reasonable attomey's fees and expenses to the extent allowed by Idaho law. ASSET PURCHASf, AGREEMEU . 29 1 4347 456_1.docx [30-1 74] ARTICLE XI GENERAL PROVISIONS SECTION 11.01 APPLICABLE LAW; JURISDICTION AND VENUE. This Agreement shall be govemed by and construed in accordance with the laws of the State of ldaho excluding any choice of law rules that may direct the application of the laws of any other jurisdiction. SECTION I1.02 NOTICE. (A) Al1 notices, certificates or other communications hereunder shall be sufficiently given and shall be deemcd given whcn hand delivered or mailed by registered or certified mail, postage prepaid. or by couricr service, charges prepaid, to the Parties at the following addresses: Suez Water Idaho Inc. To Buyer: 8248 W. Victory Road Boise, tdaho 83709 To Seller: H2O Eagle Acquisition, LLC 30 N. Gould St., Suite N Sheridan, Wyoming 82801 (B) Any written notice given to one person in subsection (A) of this Section shall also be copied and provided to all other persons identified in subsection (A). (C) The Parties may, by notice in writing given to the others, designate any future or different addresses and additional persons to which the subsequent notices, certificates or other communications shall be sent. Any notices shall be deemed given on the date such notice is delivered by hand or by facsimile transmission or five (5) days after the date mailed. ASsET PTIRCHASE AGRf,EM}:N.T - 3O 1 4347 436_1.docx [30-1 741 SECTION I1.03 ASSIGNMENT AND JOINDER. (A) Other than the assignment pursuant to Scstion 6.06 hereo{ this Agreement may not be assigned without the prior written consent of the non-assigning Parly, which consent shall not be unreasonably withheld. (B) This Agreement shall be construed as solely for the benefit of Seller and Buyer and their successors and assigns and no claim or cause of action shall accrue to or for the benefit of any other party. (C) This Aggeement shall be binding on and shall inure to the benefit of the Parties to it and their respective successors and permitted assigns. SECTION 11.04 AMENDMENTS AND WAMRS. Except as otherwise pror.ided in this Agreement, no amendment, supplement, modification or waiver of this Agreement shall be binding upon any Party hereto unless executed in writing by such Party. No waiver of any of the provisions of this Agrecmcnt shall be deemed or shall constifute a waiver of any other provision of this Agrecment, whether or not similar, unless otherwise expressly provided. SECTION 11.05 ENTIRE AGREEMENT. This Agreement is the entire agreement between the Parties and supersedes ail prior and contemporaneous agreements, understandings, negotiations and/or discussions of the agreements, understandings, negotiations and/or discussions of the Parties, whether oral or written, pertaining to the subject matter hcreoi and there are no warranties, representations or other agreements between the Parties in connection with the subject mattcr hereof, except as specitically set forlh herein. SECTION 11.06 REMEDIES; TERIVIINATION EVENTS. By notice given prior to or at the time of Closing, this Agreement may be terminated as follows: ASSOT PUNCHASE ACREEIIIENT . 3 I '1 4347456_1.docx [30-1 7al (A) Without limiting any of the rights and remedies at law available to Buyer arising from Sellcr's failure to comply with its obligations under this Agreement, including, without limitation, the remedy of specific performance, if the Govemmental Authorizations set out in Article V , or if all conditions precedent to Buyer's obligation to close set out in Article VI have not been satisfied prior to the Closing Date, Buyer shall have the right of termination, by delivery of written notice to Seller. (B) Without limiting the rights and rernedies available to Seller pursuant to Scction 11.07(A) hereof in connection with Buyer's failure to comply with its obligations under this Agreement, if the Govemmental Authorizations set out in Articlc VI, or if all conditions precedent to Seller's obligation to close set out in Articlc V__lI have not been satisfied on or prior to the Closing Date, Buyer shall have the right of termination, without further recourse or liability to Buyer, by delivery of notice to Seller. (C) As otherwise provided in this Agreement. SECTION 11.07 REMEDIES; EFFECT OF TERI\IINATION. (A) Each Party's right of termination under Section I I .06 is in addition to any other rights it may have under this Agreement or otherwise and the exercise of such right of termination is not ax election of remedies, If this Agreement is terminated pursuant to Scetio! I 1.06, all obligations of the Parties under this Agreement shall terminate unless otherwise stated in this Agreement; provided, however. that if this Agreement is terminated because of a breach of this Agreement by Seller or because one or more of the conditions to the Buyer's obligations under this Agreement is not satisfied as a result of the Seller's failure to comply with its obligations under this Agreement, Buyer's right to pursue all legal and equitable remedies will survive such termination unirnpaired. Notwithstanding anything herein contained to the ASSf,T PURCTIASE AGREEMENT - 32'14347456_1,docx [30-1 74] contrary. Seller's sole remedy for a default by Buyer of its obligations under this Agreement shall be to terminate this Agreemcnt by giving written notice to Buyer prior to or at Closing and recover liquidated damages in the amount of Five Thousand Dollars ($5,000.00). Seller and Buyer agree that the foregoing arnount is a fair and reasonable amount to be paid to Seller as agreed and liquidated damages in light of Seller entering into this Agreement and incurring costs pursuant hereto, and the foregoing amount shall not constitute a penalty or forfeiture. Seller and Buyer agree that Seller's damages resulting from Buyer's default hereunder are difficult to determine and the foregoing sum is a fair estimate of such damages which has been agreed to in an effort to cause the amount of such damages to be certain. Furthermore, notwithstanding anything herein contained to the contrary, Seller shall not have the remedy of specific performance in connection with any breach of this Agreement by Buyer or Buyer's failure to purchase the Purchased Assets. (B) Neither Seller nor Buyer shall be liable to the other in the event that after the EffEctive Date there occurs (1) a change of law that prevents the Closing, (2) any action by a third party (except Eagle) that prevents the Closing, or (3) any legal order that prevents the Closing. Both Parties shall diligently defend against a third pafiy's (except Eagle) attempt to prevent a Closing or Covemmental Authorization. (C) If a material breach of any provision of this Agreernent has been committed by a Party and such Breach has not been waived by the non-breaching Pa(y, but does not result in termination of this Agreement, the non-breaching Party shall retain all remedies available to it at law or in equity with respect to such breach, (D) Neither Seller nor Buyer shall be liable to the other for any special, consequential or punitive damages. ASSET PLIRCHASE AGRI.]EMENT . 33 14347 456_1.docx [30-1 74] SECTION 11.08 COUNTERPARTS. This Agreement may be executed in counterparts, each of which shall be considered an original. The Parties expect that the Seller will execute this Agreement before execution by the Buyer. Seller understands and agrees that Buyer will not executc this Agreement without the prior approval of its Board of Directors, whose discretion to accept or reject this Agreement prior to execution by Buyer shall in no way be limited by Seller's execution hereof. SECTION 11.09 SECTION HEADINGS. Any headings preceding the texts of the several articles, sections or exhibits in this Agreernent shall be solely for the conveniencc of reference and shall not constitute a part of this Agreement nor affect its meaning, construction or effect. SECTION 11.10 SEVERABILITY. In the event any term or provision of this Agreement is held to bc invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement and the remainder of this Agreement shall be construed to be in full force and effect. SECTION 11.11 EXHIBITS AND SCHEDULES. All exhibits, schedules and attachments ref'erred to herein are intended to be and hereby are made specifically a part of this Agreement. SECTION 1I.12 STOCK ACQUISITION, At any time prior to the Closing Date, Buyer may elect, in Buyer's sole discretion to purchase 100% of the stock in Eagle in lieu of purchasing the Purchased Assets. Within five (5) days after receipt of Buyer's wntten notice, Seller shall enter into the Stock Purchase Agrecment ("SPA"). Upon Buyer and Seller executing and entering into the SPA, this Agreement shall automatically terminate and Buyer's and Seller's obligations and liabilities hereunder shall become null and void. ASSET PURCHASE AGREEMEXT. 34 14347456_1.docx [30-1 74] SECTION 11.13 PUBLICITY. No public announcement of this Agreement or the transactions contemplated hereby will be made without the prior consent of Buyer as to both timing and content, except that either Party, without the other Party's consent, may make such announcements and disclosures as it believes advisable pursuant to law. Buyer and Seller covenant and agree to keep strictly confidential (except for necessary disclosure to advisors, including, but not limited to, lawyers and accountants) the purchase price and the terms and conditions under this Agreement. SECTION 11.14 EXCLUSNITY. Seller covenants to Buyer that during the term of this Agreement it will not seek or entertain any agreement with any other person for the sale of Eagle assets or the assignment of the Eagle APA. ISignature Page Follows] ASSET PURCHAsf, AGR.EEMENT - 35 14347456_'l.docx [3G1741 IN WITNESS WHEREOF, the Seller and Buyer have caused this Agreement to be duly executed and entered into effective as of the date first above written. SELLER:H2O EAGLE ACQUISITION LLC, A Wyoming limited liability company By: BUYER:SUEZ WATER IDAHO INC., an Idaho corporation Title: t{*es\il.l {}lou rr<rl{ vP { er*c-*l-'6n 46s1tqq AssET PURCUASE AGREEMENT I 4347456_1.doo( [30-174] STATE OF IDAHO ) ) ) SS. County of Ada On this /,- ,[''bay of September 2018, before me, the undersigned, a Notary Public in and for be said state,allyappeared@ , known or identified to me to I .f'r'Wad\daho Inc" the person who executed the foregoing instrument on behalf of said same in said corporation's name. and acknowledged to me that he executed the IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first above written. ttl U'an l.'i\r.t,ka,rLrl;u,.-n\ Notary Public for Idaho Residing at e 'tt 3u-4 My Commission expires OF STATE OF IDAHO ) ) ) SS County of Ada On this {autof September 2018, the undersigned, a Notary Public. in arld for said state, personally appeared N.L. Bangle, known or identified to me to be theL>ir p6Jt.:v' of H2O Eagle Acquisition LLC,a limited liability company, who subscribed said limited liability company name to the foregoing instrument, and acknowledged to me that he executed the same in said limitcd liabiliry company's name. IN WITNESS WHEREOF, I have hereunto set my hand and affrxed my offrcial seal the day and year in this certificate first above Notary Public for Idaho )Residing at f-tr t)lvr+ My Commission expires OF AssET PURCHASE AGREEMEI\"7 14347456 2.docx [30-174] goTA4y -a-Pusurc IOTARY O.O PusLrc Exhibit A - Exhibit B Exhibit C * Exhibit D - Exhibit E -- Exhibit F Exhibit c - Exhibit H - EXHIBIT LIST Service Area Easements Exoluded Assets Fee Parcels Personal Property Customer Deposits and Hookup Fees Eagle APA Form of Assignrnent and Assumption EXHIBIT LIST. I 1 4347456_1.docx [30-1 74] I EXIIIBTT A SERVICE AREA All of that aree withh Ade County,Idaho within which Eagle Water Company,Inc. is authorized to provide regulated water utility service pursuant to Certificate of Convenience and Necessity No.278, as issued, amended and revised per orders of the ldaho Public Utilitles Commission" as geuerally depicted belo6 together with any areas sened by Eagle lVater Company at the date of Closing whether included fu CPCN No. 278 or not. EXHIBITA.I 14347456_1.rtocx [30-174] i.- EXHIBIT B EASEMENTS All existing easements and/or rights-of-way necessary or convenient for ingress, egress, access to, or the location, operation and/or maintenance of the Purchased Assets, that are not within a plat or dedicated roadway, including but not limited to those recorded Easements set forth below: Sage Acres Booster Pump Station - Public Water Supply Equipment Access Easement Agreement with Ada County. Dated August2l,2012. Agreement No. 9754 Pipeline easement for yard booster pump station suction piping - Alison and Greg Guyrnon property Pipeline on Dry Creek Cemetery property Pipelines on the west side of the systern, north of Olcl State Street (depicted on2007 Master Plan map as "future", were these installed?) Pipeline on Jadc LLC properties (southwest of Hill Rd/Old Horseshoe Bend Road Intersection) and through the storage units south of that. Pipeline through Winco/Home Depot parking lot Any canal crossing easements/agreements Other pipelines not in the public right-of-way identified by H2O and EWC (ANY OTHERS TO BE ADDED AF'TER COMPLETION OF DUE DILIGENCE) Exursrr B - 1 '1 4347456_'1 .docx [30-1 741 EXHIBIT C EXCLUDED ASSETS 1. Any and all customer water service lines that run from outside the meter box or curbside connection to each individual residence, commercial or industrial structure served by the Purchased Assets; 2. All piping and fixtures internal to each of the customer's structure;3. Seller's cash and accounts receivables, including surcharge amounts, up to the date of Closing;4. Seller's asset retirement obligation, if any; 5. Construction equipment and trailers; 6. Motor vehicles; 7. The shop building and real property located at 10255 N. Horseshoe Bend Road, Eagle, Idaho (exclusive of the neighboring Yard Booster Pump Station property, and all pipeline routes, and ingress/egress access Easements, which are to be acquired as Purchased Assets). 8. The office space at 188 W. State Street. 9. Lot 3, Block T,Eagle Hills West No. 4 Subdivision, also known as 621North Pebble Beach Way, Eagle, Idaho 83616 EXIIIBIT C - I Asset Purchase Agreement - Eagle H2O - SUEZ (FINAL).DOCX [30-174] EXIBIT D FEE PARCELS All that real property located in Ada County, Idaho and legally described in: Exhibit A to Amended Lease Agreement dated August l, 1990 by and between Rowland Jones and Robert V. Deshazo, Sr. as grantor and Eagle Water Company. [nc. as Grantee, Ada County Instrument No. 9041853 (to be converted to Fee or other mutually acceptable arrangement prior to Closing) Exhibit A to Amended Lease Agreement dated August l, 1990 by and between Rowland Jones and Robert V. Deshazo, Sr. as grantor and Eagle Water Company, Inc. as Grantee, Ada County Instrument No. 9041854 (to be converted to Fee or other mutually acceptable arrangement prior to Closing) Corporation Warranty Deed dated January 4,1978, Ada County Instrument No.7929797 (Well 3). Warranty Deed dated February I l, 2005, Ada County Instrument No. 105018423 (Well 4) Warranty Deed dated January 23, 1996, Ada County Instrument No. 96013622 (Well6) Corporate Warranty Deed Dated April 9, 2010, Ada County Instrument No. I10033057 (Well 7 and Well 8) Quitclaim Deed dated January 28,2A1l, Ada County Instrument No. I 11009730 (Parcel A Yard Booster Pump Station) Quitclaim Deed dated January 28,201l, Ada County Instrument No. I 1 1009731 (Parcel B Yard Booster Pump Station) (ANY OTHERS TO BE ADDED AFTER COMPLETION OF DUE DILIGENCE) EXHIBIT D- I Asset Purchase Agreement - Eagle H2O - SUEZ (FINAL).DOCX [30-1741 EXHIBIT E PERSONAL PROPERTY All Personal Property within the meaning given in Article 2, Section 2.02(AX4) of this Agreement, including without limitation the following specific assets, propefties, and rights of Seller: 1. A11 water distnbution system piping, meters, hydrants, PRV's, connection vaults to other water systems, and all other associated appurtenances, generally including the following amounts of pipe. Piping Description Linear Footage Service lines (mainly 1.5" and 2') 21,130 4 11,074 6"45.416 8t'150,324 72"86.514 Total 3 17,51 8 (60.1 miles) 2. All stored inventory of meters and hydrants 3. Well Facilities including all generators, buildings, appurtenances, and associated land, easements, leases, and nght-of-ways, Well Facility Capacity (spm) 1 2 325 3 Not Active 4 1,800 6 2,500 7 1,350 8 1,800 Total 8,025 1. Al1 Booster pumping facilities including all generators, buildings, appurtenances, and associated land, easements, leases, and right-of-ways. Booster Pumping Facility EWC Reported Capacity (mm) Yard Booster Pump Station 5,900 Sage Acres Booster Pump Station 1,900 EXHIBIT E - I 1 4347456*1 . docx 130-1 7 4l Not Active 5. All water rights, permits, licenses and associated implements, including but not limited to: Water Right No. Priority Date Water Use Diversion Rate (cfs) Diversion Rate (spm) Licensed or Decreed Water Rights 63-7368 63-7618 1,2,3 1,2,3 11t15t',t970 10t25t1972 FIRE PROTECTION 2.OO 900 MUNICIPAL 2.00 900 MUNICIPAL 1.40 630 63-9245 63-1 1 798 1,2,3,8 4 6/B/1 979 411711992 FIRE PROTECTION 3.50 1,575 MUNICIPAT 1.10 495 MUNICIPAL 't.34 603 Recenlly Licensed Water Rights 63-12147 4,6 9t29t1994 MUNICIPAL 5.00 2,250 63-1 2559 7 1211511999 MUNICIPAL 3.00 1,350 WATER RIGHTS TOTAT 13.84 6,228 6. All cash and accounts receivables after the closing date, including surcharge amounts 7. Billing system, all customer accounts and records. 8. AII facility records and as-built documentation of the water system. EXHIBIT E - 2 14347456 -1.docx [30-1 74] (ANY OTHERS TO BE ADDED AFTER COMPLETION OF DUE DILIGENCE) Authorized r I EXEIBIT F CUSTOMER DEPOSITS [to be provided by Eegle H2O Acqulsltton LLCI (ANy OTr{ERS TO BE ADDED AF rER COMPLETION OF DUE DTLIGENCE) EXHIBIT F.1 '14347456_1.docx [30-1 74] EXHIBIT G IntentionallyOmitted EXHIBIT H Assignmentand AssumptionAgreement ASSIGNMENT AND ASSI]MPTION AGREEMENT THIS ASSIGTMEhIT AND ASSUMPTION ACRF.EMENT ("Assignment") is entered into effective as of the 2a {hy of September, 20 I 8, by and betwee n H2O Eagle Acquisition LLC, a Wyoming limited liabiliry company ("Assignor") and SIIEZ Water Idaho Inc. and Idaho corporation ("Assignee"). Assignor and Assignee may be individually referred to herein as a "Party" and collective ly as the "Parties." RECITALS A. Assignor and Assignee are parties to that Asset Purchase Agreement dated effcctive Septernber 20,2018 (the "Agreement"), wherein Assignor agreed to transfer and assign to Assignee, and Assignee agreed to purchase, accept, and assume from Assignor, all of Assignor's right, title, and interest in and to that cortain Asset Purchase Agreement entered into effective May 14,2018 by and between Assignor and Eagle Water Company, Inc. (the "Original Agreement"), as superseded, updated and replaccd by that certain Definitive Asset Purchase Agreement between Assignor and Eagle Water Company, Inc. dated effcctivc Scptcmbcr 19,2018 (the "Eagle Agreement"). B. Assignor hereby desires to transf'er and assign to Assigncc and Assigncc dcsires to accept and receive from Assignor, the Eagle Agreement. ASSIGNMENT NOW THEREFORE, in consideration of the mutual promises and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency ofwhich are hereby acknowledged, the Parties hereby agre€ as follows: 1. Assignment. Effective as of the date hereof and for value received, Assignor hercby ffansfers and assigns to Assignec all of Assignor's right, title, and interest in and to thc Eagle Agreement. 2. Assumption. Effective as of the date hereof, Assignee hereby acquires, accepts, and assumes all of Assignor's right, titlc, and intcrcst in and to the Eagle Agreement and all of Assignor's duties, responsibilities, and obligations arising from thc Eaglc Agrccment. 3. Relationship to Agreement. Notwithstanding any,thing herein to the contrary, this Assignment is made pursuant to the Agreement, and n<-rthing herein shall be construed to modiS, expand, or otherwise detract from or add to the covenants, warranties, indemnities, tmd agreements made by Assignor and Assignee in the Agreement. 4. Counterparts. This Assignment may be executed in any number of counterparts, and once so executed by all parties hereto each such counterpart shall be deemed to be an original instrument, but all counterparts together shall constitute but one agreement. [Signatures on following page] ASSTGNMENT AND ASSUMPTION AGREEMENT. I 1433208 8_3.docx IN WIINESIi WHEREOF, tho Prrties hercto hrvc oooutcd tlrir Asrigprncnt cffcctivc tr of ths dry and ycar fint rbovo wriucn. ASISIIGNOR:n2O EAGLE ACQUISmON LIr, A Wyoming limitcd liability company Titlc: ASSIGNEE:SI'E'Z WATER IDAIIO INC., an ldalro coirpmation AsITGINN,IENT ANI' AEII,III?TION AGNEIIfEilT. 2 14$2mt 3.doc* STATE OF IDAHO ) ss. County of Ada on this tfltt 18, bcfore the rmdersigned, a Notary Public in and for said state,known or identified to me to bc thc SUEZ Wetcr lnc., the person who executed the forcgoing instrument on behalf of said corporation, and acknowledged to me that he executed the same in said corporation's name. lN WITNESS WHEREOF, I havc hereunto set my hand and affixed my official ssal the day and year in this cenificate first above written. htrtM Notary Public Idaho Residing at My Commission expires OF STATE OF IDAHO County of Ada IN WITNESS WHEREOF, I havc hereunto set my hand and affixcd my oflicial scal the day and year in this certificatc first above written. kLtruirr&a.ut1-c-i''r Notary Public for ldaho bt"w'ur:trb 8-1a4-Residing att My Commission expires of ASSIGNMENT AIYD ASSUMMION AGREEMEI'{T. 3 14332088 l.dmr ) ) ) ss. On this?,jlota.y of Sr:ptumbcr 2018, tho. undursigned, a Notury Puh[ic in and for said state, personally appeared N.L. Banglc, known or identified to me to be tlrc'l;1gltrr of H2O Eaglc Acquisition LLC, a limited liability company, who subscribed said limited liability company name to the forcgoing instrumcnt, and aclnowledged to me that he executed the samc in said limited liabiliry company's name. 1" $oTARr -a.)Pusurc