##### 



Exhibit 4.34
 [EXECUTION COPY]
 
 CONNECTICUT DEVELOPMENT AUTHORITY
 and
 THE CONNECTICUT WATER COMPANY
 
 LOAN AGREEMENT
 
 Dated as of December 1, 2007
 Connecticut Development Authority
$15,000,000 Water Facilities Revenue Bonds
(The Connecticut Water Company Project  2007A Series)




---



##### 



TABLE OF CONTENTS
 PagePREAMBLE
    
    
    1ARTICLE I DEFINITIONS AND INTERPRETATION
    
    
    3Section 1.1. Definitions
    
    
    3Section 1.2. Interpretation
    
    
    7ARTICLE II REPRESENTATIONS AND WARRANTIES
    
    
    9Section 2.1. Representations by the Authority
    
    
    9Section 2.2. Representations by the Borrower
    
    
    10ARTICLE III THE LOAN
    
    
    13Section 3.1. Loan Clauses
    
    
    13Section 3.2. Other Amounts Payable
    
    
    13Section 3.3. Manner of Payment
    
    
    14Section 3.4. Obligation Unconditional
    
    
    14Section 3.5. Securities Clauses
    
    
    14Section 3.6. Issuance of Bonds
    
    
    14Section 3.7. Effective Date and Term
    
    
    14Section 3.8. No Additional Bonds
    
    
    15ARTICLE IV THE PROJECT
    
    
    16Section 4.1. Completion of the Project
    
    
    16Section 4.2. Payment of Additional Project Costs by Borrower
    
    
    17Section 4.3. Completion Certificate
    
    
    17Section 4.4. No Warranty Regarding Condition, Suitability or Cost of Project
    
    
    17Section 4.5. Taxes
    
    
    17Section 4.6. Insurance
    
    
    17Section 4.7. Compliance with Law
    
    
    18Section 4.8. Maintenance and Repair
    
    
    18Section 4.9. Disposition of Project Realty by Borrower
    
    
    18Section 4.10. Leasing of the Project Realty and the Project Equipment
    
    
    19Section 4.11. Project Equipment
    
    
    19Section 4.12. Borrower Contribution
    
    
    19ARTICLE V CONDEMNATION DAMAGE AND DESTRUCTION
    
    
    20Section 5.1. No Abatement of Payments Hereunder
    
    
    20Section 5.2. Project Disposition Upon Condemnation, Damage or Destruction
    
    
    20Section 5.3. Application of Net Proceeds of Insurance or Condemnation
    
    
    20ARTICLE VI COVENANTS
    
    
    21Section 6.1. The Borrower to Maintain its Corporate Existence; Conditions under
which Exceptions Permitted
    
    
    21Section 6.2. Indemnification, Payment of Expenses, and Advances
    
    
    21Section 6.3. Incorporation of Tax Regulatory Agreement; Payments Upon Taxability
    
    
    23Section 6.4. Public Purpose Covenants
    
    
    24Section 6.5. Further Assurances and Corrective Instruments
    
    
    24Section 6.6. Covenant by Borrower as to Compliance with Indenture
    
    
    24Section 6.7. Assignment of Agreement or Note
    
    
    24Section 6.8. Inspection
    
    
    25
 -i-




---



##### 



PageSection 6.9. Default Notification
    
    
    25Section 6.10. Covenant Against Discrimination
    
    
    25Section 6.11. Covenant to Provide Disclosure
    
    
    25Section 6.12. Negative Pledge
    
    
    25ARTICLE VII EVENTS OF DEFAULT AND REMEDIES
    
    
    26Section 7.1. Events of Default
    
    
    26Section 7.2. Remedies on Default
    
    
    27Section 7.3. Remedies on Public Purpose Default
    
    
    27Section 7.4. No Duty to Mitigate Damages
    
    
    28Section 7.5. Remedies Cumulative
    
    
    28ARTICLE VIII PREPAYMENT PROVISIONS
    
    
    30Section 8.1. Optional Prepayment
    
    
    30Section 8.2. Notices of Prepayment
    
    
    31Section 8.3. Mandatory Prepayment on Taxability and Receipt of Request for
Redemption of a Deceased Holders Bonds
    
    
    31ARTICLE IX GENERAL
    
    
    32Section 9.1. Indenture
    
    
    32Section 9.2. Benefit of and Enforcement by Bondholders
    
    
    32Section 9.3. Force Majeure
    
    
    32Section 9.4. Amendments
    
    
    32Section 9.5. Notices
    
    
    32Section 9.6. Prior Agreements Superseded
    
    
    33Section 9.7. Execution of Counterparts
    
    
    33Section 9.8. Time
    
    
    33Section 9.9. Separability of Invalid Provisions
    
    
    33Section 9.10. Third Party Beneficiaries
    
    
    33Section 9.11. Governing Law
    
    
    33APPENDICESAppendix A  Form of Promissory NoteAppendix B  Description of Project RealtyAppendix C  Description of Project Equipment
 -ii-




---



##### 



Connecticut Development Authority
 The Connecticut Water Company
 LOAN AGREEMENT
 THIS LOAN AGREEMENT CONNECTICUT
DEVELOPMENT AUTHORITY THE CONNECTICUT WATER COMPANY
 WITNESSETH THAT:
 WHEREAS
 WHEREAS
 WHEREAS
 WHEREAS




---



##### 



WHEREAS
 WHEREAS
 WHEREAS
 WHEREAS
 WHEREAS
 WHEREAS
 WHEREAS
 NOW, THEREFORE
 -2-




---



##### 



ARTICLE I
DEFINITIONS AND INTERPRETATION
 Section 1.1. Definitions
           -3-




---



##### 



-4-




---



##### 



Appendix A
          -5-




---



##### 



-6-




---



##### 



Section 1.2. Interpretation. In this Agreement:
    -7-




---



##### 



-8-




---



##### 



ARTICLE II
 REPRESENTATIONS AND WARRANTIES
 Section 2.1. Representations by the Authority .
         -9-




---



##### 



Section 2.2. Representations by the Borrower
       -10-




---



##### 



-11-




---



##### 



-12-




---



##### 



ARTICLE III
 THE LOAN
 Section 3.1. Loan Clauses
    Section 3.2. Other Amounts Payable
  -13-




---



##### 



Section 3.3. Manner of Payment
 Section 3.4. Obligation Unconditional.
 Section 3.5. Securities Clauses
 Section 3.6. Issuance of Bonds.
 Section 3.7. Effective Date and Term
  -14-




---



##### 



Section 3.8. No Additional Bonds
 -15-




---



##### 



ARTICLE IV
 THE PROJECT
 Section 4.1. Completion of the Project
       -16-




---



##### 



Section 4.2. Payment of Additional Project Costs by Borrower
 Section 4.3. Completion Certificate
 Section 4.4. No Warranty Regarding Condition, Suitability or Cost of Project
 Section 4.5. Taxes
  Section 4.6. Insurance
 -17-




---



##### 



Section 4.7. Compliance with Law
 Section 4.8. Maintenance and Repair
 Section 4.9. Disposition of Project Realty by Borrower
 -18-




---



##### 



Section 4.10. Leasing of the Project Realty and the Project Equipment
 Section 4.11. Project Equipment
  Section 4.12. Borrower Contribution
 -19-




---



##### 



ARTICLE V
 CONDEMNATION DAMAGE AND DESTRUCTION
 Section 5.1. No Abatement of Payments Hereunder
 Section 5.2. Project Disposition Upon Condemnation, Damage or Destruction
    Section 5.3. Application of Net Proceeds of Insurance or Condemnation
   -20-




---



##### 



ARTICLE VI
 COVENANTS
 Section 6.1. The Borrower to Maintain its Corporate Existence; Conditions under which
Exceptions Permitted
  Section 6.2. Indemnification, Payment of Expenses, and Advances
    -21-




---



##### 



-22-




---



##### 



Section 6.3. Incorporation of Tax Regulatory Agreement; Payments Upon Taxability
    -23-




---



##### 



Section 6.4. Public Purpose Covenants
  Section 6.5. Further Assurances and Corrective Instruments
 Section 6.6. Covenant by Borrower as to Compliance with Indenture
 Section 6.7. Assignment of Agreement or Note
 -24-




---



##### 



Section 6.8. Inspection
 Section 6.9. Default Notification
 Section 6.10. Covenant Against Discrimination
  Section 6.11. Covenant to Provide Disclosure
 Section 6.12. Negative Pledge .
 -25-




---



##### 



ARTICLE VII
 EVENTS OF DEFAULT AND REMEDIES
 Section 7.1. Events of Default
        -26-




---



##### 



Section 7.2. Remedies on Default
      Section 7.3. Remedies on Public Purpose Default
  -27-




---



##### 



Section 7.4. No Duty to Mitigate Damages
 Section 7.5. Remedies Cumulative
 -28-




---



##### 



-29-




---



##### 



ARTICLE VIII
 PREPAYMENT PROVISIONS
 Section 8.1. Optional Prepayment
       -30-




---



##### 



Section 8.2. Notices of Prepayment
 Section 8.3. Mandatory Prepayment on Taxability and Receipt of Request for Redemption of a
Deceased Holders Bonds
 -31-




---



##### 



ARTICLE IX
 GENERAL
 Section 9.1. Indenture
  Section 9.2. Benefit of and Enforcement by Bondholders
 Section 9.3. Force Majeure
 Section 9.4. Amendments
 Section 9.5. Notices
 -32-




---



##### 



Section 9.6. Prior Agreements Superseded
 Section 9.7. Execution of Counterparts
 Section 9.8. Time
 Section 9.9. Separability of Invalid Provisions
 Section 9.10. Third Party Beneficiaries
 Section 9.11. Governing Law
 -33-




---



##### 



IN WITNESS WHEREOF
 CONNECTICUT DEVELOPMENT AUTHORITYBy
    
    /s/ Karin A. LawrenceName: Karin A. LawrenceAuthorized RepresentativeTHE CONNECTICUT WATER COMPANYBy
    
    /s/ David C. BenoitName: David C. BenoitTitle: Vice President  Finance andChief Financial Officer
 -34-




---



##### 



APPENDIX A
 THE CONNECTICUT WATER COMPANY
 FORM OF
PROMISSORY NOTE
2007A SERIES
 No. 1
    
    $15,000,000
      A-1




---



##### 



THE CONNECTICUT WATER COMPANYBy:Name:Authorized Representative A-2




---



##### 



AUTHORITY ENDORSEMENT
  CONNECTICUT DEVELOPMENT AUTHORITYBy:Name:Authorized Representative A-3




---



##### 



APPENDIX B
 DESCRIPTION OF PROJECT REALTY




---



##### 



APPENDIX C
 DESCRIPTION OF PROJECT EQUIPMENT
   Description
    
    LocationShoreline RegionMacKenzie Water Treatment Plant, replace low lift
pumps.
    
    12 Kelseytown Bridge Road, Clinton, CTClean and Line Kelseytown unlined cast iron
transmission main.
    
    Kelseytown Bridge Road to Iron Works Road pump
station, at intersection with Glenwood Road,
Clinton.Killingworth Reservoir Aeration
    
    105 Deep River Road., (Rte 80), Killingworth, CTSound View Metering, Phase II  Install meter pits
and meters for previously flat-rate customers in
White Sands Beach and Sound View Beach
Associations.
    
    Springfield Rd., New Britain Rd., Meriden Rd.,
Seaside Ln., Cottage Rd., Old Shore Rd., Hartford
Ave., Portland Ave., Swan Ave., Old Lyme, CTSound View Clearwell #2
    
    Storage Tank Located at Hartung Well Field, off
Cross Lane Approximately 500 Feet From
Intersection with Shore Road , Old Lyme, CTPoint OWoods Main Replacement
    
    Connecticut Road., Ridgewood Road, Massachusetts
Road, Old Lyme, CT.Glenwood Rd., Clean and line 2300 LF of 14 cast
iron water main.
    
    Glenwood Road, Clinton, from Iron Works Road to
Cream Pot Road.Customer and Financial Information System software
upgrade and replacement, corporate office.
    
    93 West Main Street, Clinton, CTEmergency Water Service Pneumatic Tank, deployed
to various locations as needed.
    
    93 West Main Street, Clinton, CTUPS Replacement, Corporate Office
    
    93 West Main Street, Clinton, CTFive Fields Well Pump Replacement
    
    99 Five Field Road, Madison, CT




---



##### 



Description
    
    LocationCopse Road Water Main Replacement
    
    Copse Road, Madison from Route 1 to Fort Path RoadAS400, File Server, Network Replacement, Corporate
Office
    
    93 West Main Street, Clinton, CTGoose Hill Road Supply Main
    
    From Williams Water Treatment Plant, 73 Goose Hill
Road, Chester, CT to intersection of Kings
Highway.Hilltop Drive Measurement Line Replacement
    
    Hilltop Drive, Madison, CT from Liberty St to
cul-de-sac.SCADA Server Upgrades  Hardware and Software
    
    Company wide, offices and water treatment facilitiesLee Company Tank, Westbrook
    
    Spencer Plains Road, WestbrookNaugatuck RegionProspect  Indian Fields Water Main
    
    From Route 68 down Straitsville Rd to Salem Rd/May
Street to Maple Hill Road to intersection with
Arbor Avenue in Naugatuk. ConnecticutCanal Street Water Main Relocation
    
    On Canal St., from Meridien St to Route 72 and from
Allen Street to Tunnel Road, Plymouth, CTHunters Mountain Pump Station Control Valves
    
    160 Hunters Mountain Road, Naugatuck, CTRoute 4 at New Stop & Shop
    
    Route 4, 1823 Farmington Avenue, UnionvilleRoute 4 at Fulling Brook, DOT Bridge Replacement
    
    Farmington Avenue (Rte. 4) at Fulling Brook Bridge
Crossing, Farmington, CTHighlands Area Water Main Replacement
    
    On Briarwood Rd. from Knollwood Rd to end at
cul-de-sac, On Arwood Rd. from Briarwood Rd to end
at cul-de-sac, Farmington, CTCemetery Road PS VFD Replacement
    
    8 Cemetery Road, CantonNorthern RegionShaker Road Pump Station
    
    246 Shaker Road, Enfield, CTHunt Water Treatment Plant  Replace Electrical
System
    
    4 Mahoney Road, East Windsor, CTSuffield and North Streets  Water Main Replacement
    
    North Street  Between Rt 159, Suffield St from
North St to Poplar St., Windsor Locks, CTRoute 159 Water Main Replacement, Phase II
    
    North Main Street from Olive Street, Windsor Locks
to Harvey Lane, Suffield, CTThompsonville Well #9  New Source of Supply
    
    40 Booth Road, Enfield, CTWells & Rice Road Water Main Extension
    
    Wells Road from Winkler Road to Rice Road,
continuing on Rice Road to North Road, East
Windsor
 A-2




---



##### 



Description
    
    LocationRockville High Service Water Main
    
    Upper Butcher Road and Middle Butcher Road, from
Snipsic Street to Ellington Avenue, Rockville, CTAvery Heights Water Association Metering
    
    Benedict Dr., Spruce Ln., Pine Tree Ln., High View
Rd., Manor Ln., Avery St., Pond Ln., Peach Tree
Ln., Kelly Rd., Goodhill Rd., Raymond Rd., South
Windsor, CTSuffield Booster Motor Replacement
    
    624 Mapleton Street, Suffield, CTHale & East Street Water Main Replacement
    
    From Grove Street to East Street on Hale Street and
from Hale Street to Rte. 30 (Hartford Tpke.) on
East Street, Vernon, CTCenter Road Water Main Replacement
    
    Center Road, Vernon, CT from Hartford Turnpike to
Regan RoadProspect Street Reconstruction
    
    From West Main Street to Church Street on Prospect
St, Stafford, CTEastern RegionBrooklyn Well Chlorination
    
    At End of Quebec Street,Brooklyn, CTCemetery Road Water Main Extension to Pond View
Apt. Complex and Hill Dale water system
    
    Extension from Intersection with Route 14A down
Cemetery Road with tie- ins to Pine and Forest
Streets, Plainfield, CTPlainfield Center Water Main Replacements, Phase II
    
    Third Street Extension Loop, going West on Third
Street Ext from Second Street, continuing North on
Third Street Ext towards Railroad Avenue (Rte.
14A), continuing East on Third Street Ext, then
South on Third Street Ext to meet starting point of
loop West of Second Street, Plainfield, CTGallup Well #1 Standby Power System
    
    19 Fourth Street, Plainfield, CTHigh Service Water Main, Eliminate Dow Road Pump
Station
    
    Pipe in Easement from First Street to Community
Avenue, PlainfieldWauregan Water Main Replacements
    
    South Chestnut from First to Front Streets, South
Walnut from Brooklyn Rd, 320 south, North Walnut
from Brooklyn Rd to North Cross Streets. Wauregan
section of Plainfield, CT
 A-3