Document:

EX-4.2.3

 Exhibit 4.2.3 

EXECUTION COPY 
  

 
  

SECOND SUPPLEMENTAL TRUST INDENTURE 

THE INDUSTRIAL DEVELOPMENT AUTHORITY 

OF THE COUNTY OF PIMA, 
 as
Issuer 
 and 
 U.S. BANK
NATIONAL ASSOCIATION, 
 as Trustee 

$24,550,000 
 The Industrial
Development Authority 
 of the County of Pima 

Water and Wastewater Revenue Bonds 

(Global Water Resources, LLC Project) 

Series 2008 
 Dated as of
August 1, 2008 
  
  

 

  

 TABLE OF CONTENTS 
  

									
		  	 	Page	  
		
	 ARTICLE I

SUPPLEMENTAL INDENTURE; DEFINITIONS
	  			
				
	 Section 1.01.
	 		  	Supplemental Indenture	  	 	3	  
				
	 Section 1.02.
	 		  	Definitions	  	 	3	  
			
		  	 ARTICLE II

AUTHORIZATION AND TERMS OF THE SERIES 2008 BONDS
	  			
				
	 Section 2.01.
	 		  	The Series 2008 Bonds; Issuance and Terms	  	 	4	  
				
	 Section 2.02.
	 		  	Optional and Mandatory Redemption	  	 	6	  
				
	 Section 2.03.
	 		  	Partial Redemption	  	 	9	  
				
	 Section 2.04.
	 		  	Election to Redeem	  	 	9	  
				
	 Section 2.05.
	 		  	Notice of Redemption	  	 	10	  
				
	 Section 2.06.
	 		  	Payment of Redeemed Bonds	  	 	10	  
				
	 Section 2.07.
	 		  	Delivery of Moneys for Optional Redemption	  	 	10	  
				
	 Section 2.08.
	 		  	Variation of Redemption Provisions	  	 	11	  
				
	 Section 2.09.
	 		  	Initial Delivery of the Series 2008 Bonds; Deposit of Proceeds	  	 	11	  
				
	 Section 2.10.
	 		  	Creation of the Series 2008 Project Fund	  	 	12	  
				
	 Section 2.11.
	 		  	Disbursements from and Records of Series 2008 Project Fund	  	 	12	  
				
	 Section 2.12.
	 		  	Completion of the Series 2008 Project	  	 	12	  
		
	 ARTICLE III

REPRESENTATIONS; COVENANTS AND AGREEMENTS OF ISSUER
	  			
				
	 Section 3.01.
	 		  	Covenants and Agreements of the Issuer	  	 	13	  
				
	 Section 3.02.
	 		  	Observance and Performance of Covenants, Agreements, Authority and Actions	  	 	14	  
				
	 Section 3.03.
	 		  	Enforcement of Issuer’s Obligations	  	 	15	  
				
	 Section 3.04.
	 		  	Reliance by Issuer on Facts or Certificates, Limitations on Actions	  	 	15	  
				
	 Section 3.05.
	 		  	Immunity of Issuer’s Directors, Officers, Counsel, Financial Advisors, and Agents	  	 	15	  
				
	 Section 3.06.
	 		  	No Pecuniary Liability of the Issuer	  	 	16	  
				
	 Section 3.07.
	 		  	Acceptance by Trustee of Duties Under Agreement	  	 	16	  
			
		  	 ARTICLE IV

MISCELLANEOUS
	  			
				
	 Section 4.01.
	 		  	Effect of Second Supplemental Indenture	  	 	17	  

  

									
				
	 Section 4.02.
	 		  	Severability	  	 	17	  
				
	 Section 4.03.
	 		  	Contrary Provisions Deleted	  	 	17	  
				
	 Section 4.04.
	 		  	Execution in Several Counterparts	  	 	17	  
				
	 Section 4.05.
	 		  	Conflict of Interest	  	 	17	  
				
	 Section 4.06.
	 		  	Binding Effect	  	 	17	  
				
	 EXHIBIT A
	 		  	FORM OF SERIES 2008 BOND	  			

  
 ii 

 SECOND SUPPLEMENTAL TRUST INDENTURE 

THIS SECOND SUPPLEMENTAL TRUST INDENTURE, dated as of August 1, 2008 (the “Second Supplemental
Indenture”), is by and between THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF PIMA (the “Issuer”), a nonprofit corporation designated as a political subdivision of the State of Arizona (the “State”)
incorporated with the approval of the County of Pima (the “County”) pursuant to the provisions of the Constitution of the State and under Title 35, Chapter 5, Arizona Revised Statutes, as amended, and U.S. BANK NATIONAL ASSOCIATION
(the “Trustee”), a national banking association organized under the laws of the United States of America, and authorized to exercise corporate trust powers in the State of Arizona, with a corporate trust office located in Phoenix,
Arizona. 
 WHEREAS, pursuant to the Industrial Development Financing Act, Title 35, Chapter 5 of Arizona Revised Statues,
as amended (the “Act”), the Issuer has previously issued its Industrial Development Authority of the County of Pima Water and Wastewater Revenue Bonds (Global Water Resources, LLC Project) Series 2006 (the “Series 2006 Bonds”) in
the original aggregate principal amount of $36,495,000 pursuant to a Trust Indenture dated as of December 1, 2006 (the “Series 2006 Indenture”) by and between the Issuer and the Trustee to finance or refinance the costs of the
acquisition, expansion, construction, improvement and equipping of facilities for wastewater treatment and water treatment, as well as water reclamation pipelines, water pipelines, and wastewater collection pipelines, consisting of water, wastewater
and reclaimed water infrastructure for water and wastewater treatment, including water mains, sewer mains, reclaimed water mains, water treatment facilities, water distribution centers, wastewater lift stations, wastewater treatment facilities, and
reclaimed water mixing and distribution centers as well as related information and management systems, located at 41265 West Hiller Road, Maricopa, Arizona 85239 in the City of Maricopa, Arizona (collectively, the “Series 2006 Project”);
and 
 WHEREAS, the Issuer has also previously issued its Water and Wastewater Revenue Bonds (Global Water Resources, LLC
Project) Series 2007 (the “Series 2007 Bonds”) in the original aggregate principal amount of $54,135,000 pursuant to a First Supplemental Trust Indenture dated as of November 1, 2007 (the “First Supplemental Indenture”) for
the purpose of financing or refinancing the costs of the acquisition, expansion, construction, improvement and equipping of water system major capital improvements, including a water distribution center, surface water treatment facility, water
production facilities, and pipeline, and sewerage system major capital improvements, including a water reclamation facility, sewage lift stations, reclaimed water recharge facilities and pipelines, located in the City of Maricopa, Arizona and in an
unincorporated area of Pinal County, Arizona south of the Ak-Chin Indian Community in the City of Maricopa’s “Growing Smarter Planning Area” (the “Series 2007 Project”); and 

WHEREAS, the Act authorizes the Issuer to issue revenue bonds for the purpose of financing or refinancing a
“project” under the Act; and 
 WHEREAS, Section 2.04 of the Series 2006 Indenture permits the issuance of
Additional Bonds on a parity with the Series 2006 Bonds and the Series 2007 Bonds, as to the assignment to the Trustee of the Issuer’s right, title and interest in the Revenues and the Loan Agreement (other

 
than the Unassigned Issuer’s Rights) to provide for the payment of Bond Service Charges on the Series 2008 Bonds (as such terms are defined in the Indenture); and 

WHEREAS, Section 2.04(a)(1)(A) of the Series 2006 Indenture permits the issuance of Additional Bonds on a parity with the
Series 2006 Bonds and the Series 2007 Bonds if the Trustee shall have received a report of an Accounting Firm, certifying that the Debt Service Coverage Ratio of the Company for the four most recent fiscal quarters of the Company, computed on the
basis of the Accounting Firm’s review of the Company’s financial statements (or, if the four most recent fiscal quarters of the Company constitute a fiscal year, the Company’s audited financial statements for such fiscal year), taking
into account the principal amount of all outstanding Bonds and all other Long Term Indebtedness to be outstanding after the issuance of the proposed Additional Bonds and the proposed Additional Bonds as if they had been issued at the beginning of
such four fiscal quarter period, is not less than 1.10; and 
 WHEREAS, evidenced as provided in the Indenture, the Trustee
has received a report of an Accounting Firm certifying that the Debt Service Coverage Ratio of the Company for the four most recent fiscal quarters of the Company, taking into account the principal amount of all outstanding Bonds and all other Long
Term Indebtedness outstanding after the issuance of the Series 2008 Bonds is 1.18; and 
 WHEREAS, in order to provide
additional funds for the purpose of financing or refinancing the costs of the acquisition, expansion, construction, improvement and equipping of water system major capital improvements, including a water distribution center, surface water treatment
facility, water production facilities, and pipeline, and sewerage system major capital improvements, including a water reclamation facility, sewage lift stations, reclaimed water recharge facilities and pipelines, located in the City of Maricopa,
Arizona and in an unincorporated area of Pinal County, Arizona south of the Ak-Chin Indian Community in the City of Maricopa’s “Growing Smarter Planning Area” (the “Series 2008 Project”), the Issuer has determined to make
additional amounts available in order to fund a loan to the Company in the principal amount of $24,550,000 as evidenced by the Series 2006 Loan Agreement as amended by a First Amendment to Loan Agreement dated as of November 1, 2007 (the
“First Amendment to Loan Agreement”) and as further amended by a Second Amendment to Loan Agreement dated as of August 1, 2008 between the Issuer and the Company (the “Second Amendment to Loan Agreement” and together with
the Series 2006 Loan Agreement and the First Amendment to Loan Agreement, the “Loan Agreement”); and 
 WHEREAS,
pursuant to this Second Supplemental Trust Indenture dated as of August 1, 2008 between the Issuer and the Company (the “Second Supplemental Indenture” and together with the Series 2006 Indenture and the First Supplemental Indenture,
the “Indenture”) and in order to provide funds necessary to enable the Issuer to make the loan and pay certain related costs, the Issuer, pursuant to the Act, has authorized the issuance of its revenue bonds designated as “Water and
Wastewater Revenue Bonds (Global Water Resources, LLC Project) Series 2008” in the principal amount of $24,550,000 (the “Series 2008 Bonds,” together with the Series 2006 Bonds and the Series 2007 Bonds and any Additional Bonds, the
“Bonds”). 

  
 2 

 ARTICLE I 

SUPPLEMENTAL INDENTURE; DEFINITIONS 

Section 1.01.    Supplemental Indenture.        This
Second Supplemental Indenture is supplemental to, and is executed in accordance with and pursuant to Article II of the Series 2006 Indenture, as supplemented by the First Supplemental Indenture. 

Section 1.02.    Definitions.        All terms which
are defined in the Series 2006 Indenture, as heretofore supplemented and amended by the First Supplemental Indenture, shall have the meanings, respectively, herein (including the use thereof in the recitals and the granting clauses thereof) unless
expressly given a different meaning or unless the context clearly requires otherwise. All terms used herein which are defined in the recitals hereto shall have the meanings therein given to the same unless the context requires otherwise and, in
addition, the following terms shall have the meanings specified below: 
 “Authorized
Denominations” means with respect to the Series 2008 Bonds, $100,000 or any integral multiple of $1,000 in excess thereof. 

“Bond Reserve Requirement” means at the time of the issuance of the Series 2008 Bonds, the
least of (i) 10% of the stated principal amount of the Series 2006 Bonds, the Series 2007 Bonds, the Series 2008 Bonds and any Additional Bonds; (ii) Maximum Annual Debt Service on the Series 2006 Bonds, the Series 2007 Bonds, the 2008
Bonds and any Additional Bonds; and (iii) 125% of the average annual debt service on the Series 2006 Bonds, the Series 2007 Bonds, the Series 2008 Bonds and any Additional Bonds. 

“Depository” means, with respect to the Series 2008 Bonds, The Depository Trust Company, New
York, New York, a limited-purpose trust company organized under the laws of the State of New York. 

“Intercreditor Agreement” means that Second Restated and Amended Intercreditor Agreement dated
October 1, 2008 among Wells Fargo, the Company and the Trustee. 
 “Interest Payment Date”
means, with respect to the Series 2008 Bonds, each June 1 and December 1, commencing June 1, 2009. 

“Security Agreement” means the Amended and Restated Security Agreement dated as of
August 1, 2008 by and between the Company and the Trustee. 
 “Series 2008 Bonds” means
the Issuer’s Water and Wastewater Revenue Bonds (Global Water Resources, LLC Project) Series 2008. 

“Series 2008 Project Fund” means the fund created pursuant to Section 2.10 hereof. 

“Series 2008 Project Note” means the promissory note of the Company, dated as of even date with
the Series 2008 Bonds, in the form attached to the Second Amendment to Loan Agreement and in the principal amount of $24,550,000, evidencing the obligation of the Company to make Loan Payments. 

  
 3 

 ARTICLE II 

AUTHORIZATION AND TERMS OF THE SERIES 2008 BONDS 

Section 2.01.    The Series 2008 Bonds; Issuance and Terms. 

(a)        The total aggregate principal amount of Series 2008 Bonds
that may be issued pursuant to this Second Supplemental Indenture is limited to $24,550,000. The Series 2008 Bonds are Additional Bonds within the meaning of the Indenture. 

(b)        The Series 2008 Bonds are being issued as fully registered
Additional Bonds in the total principal amount of $24,550,000 and are hereby designated as “The Industrial Development Authority of the County of Pima Water and Wastewater Revenue Bonds (Global Water Resources, LLC Project) Series 2008”,
substantially in the form set forth as Exhibit A hereto. Proceeds of the Series 2008 Bonds shall be used only for the purposes set forth in this Second Supplemental Indenture. 

(c)        The Series 2008 Bonds shall be issued in fully registered
form in a minimum denominations of $100,000 and in multiple integrals of $1,000 in excess thereof. The Series 2008 Bonds shall be dated the date of initial delivery thereof. 

(d)        The Series 2008 Bonds shall (i) bear interest from
their date of issuance, payable on June 1 and December 1 of each year commencing June 1, 2009, (ii) be in the principal amounts and (iii) mature as follows: 

 

					
	Maturity Date	  	Principal Amount	  	Interest Rate
			
	 December 1, 2018
	  	$1,315,000	  	6.3750%
	 December 1, 2038
	  	$23,235,000	  	7.500%

 (e)        The Series 2008 Bonds
may only be sold or transferred to a purchaser or transferee who is either a qualified institutional buyer (“Qualified Institutional Buyer”) within the meaning of Rule 144A of the Securities Act of 1933 or an accredited investor as defined
in Rule 501 of Regulation D of the United States Securities and Exchange Commission (“Accredited Investor” and together with a Qualified Institutional Buyer, jointly, a “Qualified Investor”). 

(f)        The Depository Trust Company, New York, New York
(“DTC”) will act as securities depository for the Series 2008 Bonds. The Series 2008 Bonds shall be initially issued in the form of a separate single fully registered, Series 2008 Bond for each separate Stated Maturity. Upon initial
issuance the ownership of such Series 2008 Bonds shall be registered in the Bond Register in the name of Cede & Co., as the nominee of DTC. So long as Cede & Co. is the registered owner of the Series 2008 Bonds, as nominee of DTC,
references herein to the Series 2008 Bondholders or registered owners of the Series 2008 Bonds shall mean Cede & Co. and shall not mean the beneficial owners of the Series 2008 Bonds. 

  
 4 

 With respect to Series 2008 Bonds registered in the Bond Register kept by the
Trustee in the name of Cede & Co. as nominee of DTC, the Issuer, the Company and the Trustee shall have no responsibility or obligation to any participant of DTC (each, a “Participant”) or to any Person for whom a Participant
acquires an interest in the Series 2008 Bonds (a “Beneficial Owner”). Without limiting the immediately preceding sentence, the Issuer, the Company and the Trustee shall have no responsibility or obligation with respect to (i) the
accuracy of the records of DTC, Cede & Co. or any Participant with respect to any ownership interest in the Series 2008 Bonds, (ii) the delivery to any Participant, any Beneficial Owner or any other Person, other than DTC, of any
notice with respect to the Series 2008 Bonds, including any notice of redemption, or (iii) the payment to any Participant, any Beneficial Owner or any other Person, other than DTC, of any amount with respect to the principal of or premium, if
any, or interest on the Series 2008 Bonds. 
 The Issuer, the Company and the Trustee may treat as and deem DTC, to be the
absolute owner of each Series 2008 Bond for the purpose of payment of the principal of and premium, if any, and interest on such Series 2008 Bond, for the purpose of giving notices of redemption and other matters with respect to such Series 2008
Bond, for the purpose of registering transfers with respect to such Series 2008 Bonds, and for all other purposes whatsoever. The Trustee shall pay all principal of and premium, if any, and interest on the Series 2008 Bonds only to or upon the order
of the Series 2008 Bondholders as shown on the Bond Register kept by the Trustee, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer’s obligations with respect to the principal of and premium, if any,
and interest on the Series 2008 Bonds to the extent of the sum or sums so paid. 
 No Person other than a Series 2008
Bondholder, as shown on the registration books kept by the Trustee, shall receive a Series 2008 Bond certificate evidencing the obligation of the Issuer to make payments of principal, and premium, if any, and interest pursuant to the Indenture. Upon
delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the transfer provisions in Section 3.06 of the Series 2006 Indenture, references
to “Cede & Co.” in this section shall refer to such new nominee of DTC. 
 DTC may determine to
discontinue providing its services with respect to the Series 2008 Bonds at any time by giving written notice to the Company and discharging its responsibilities with respect thereto under applicable law. The Company may terminate the services of
DTC with respect to the Series 2008 Bonds. 
 Upon the termination of the services of DTC as provided in the preceding
paragraph, and if no substitute securities depository willing to undertake the functions of DTC hereunder can be found which, in the opinion of the Company, is willing and able to undertake such functions upon reasonable or customary terms, or if
the Company determines not to continue a book-entry only system for the Series 2008 Bonds, then the Series 2008 Bonds shall no longer be restricted to being registered in the Bond Register kept by the Trustee in the name of Cede & Co., as
nominee of DTC, but may be registered in whatever name or names the Series 2008 Bondholders shall designate at that time, in accordance with of the Indenture. To the extent that the Beneficial Owners are designated as the transferee by the Series
2008 Bondholders, in accordance with the Indenture, the Series 2008 Bonds will be delivered to the Beneficial Owners. 

  
 5 

 Notwithstanding any other provision of this Second Supplemental Indenture to the
contrary, so long as any Series 2008 Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect to the principal of and premium, if any, and interest on such Series 2008 Bond and all notice with respect to
such Series 2008 Bond shall be made and given, respectively, to DTC as provided in the terms of any agreement between DTC and the Issuer and Trustee. 

Section 2.02.    Optional and Mandatory
Redemption.        The Series 2008 Bonds are subject to redemption as follows: 

(a)        Mandatory Sinking Fund
Redemption.     The Series 2008 Bonds maturing on December 1 of the following years are subject to mandatory redemption pursuant to mandatory sinking fund requirements, at a redemption price of 100 percent of the
principal amount redeemed plus interest accrued to the redemption date, on December 1, in the following principal amounts in the years specified: 
  

			
	 Bonds Maturing     December 1,
2018

		
	 Year

(December 1)
	  	 Principal Amount

($)

		
	 2012
	  	155,000
	 2013
	  	165,000
	 2014
	  	175,000
	 2015
	  	185,000
	 2016
	  	200,000
	 2017
	  	210,000
	 2018*
	  	225,000

 * Maturity Date 
  

			
	 Bonds Maturing December 1, 2038

		
	 Year

(December 1)
	  	 Principal Amount

($)

		
	 2019
	  	475,000
	 2020
	  	515,000
	 2021
	  	550,000
	 2022
	  	595,000
	 2023
	  	635,000
	 2024
	  	685,000
	 2025
	  	735,000
	 2026
	  	790,000
	 2027
	  	850,000
	 2028
	  	915,000
	 2029
	  	985,000
	 2030
	  	1,055,000
	 2031
	  	1,135,000

  
 6 

			
	 2032
	  	1,220,000
	 2033
	  	1,315,000
	 2034
	  	1,410,000
	 2035
	  	1,515,000
	 2036
	  	1,630,000
	 2037
	  	1,755,000
	 2038*
	  	4,470,000

  

	 	•	 	 Maturity Date 

The aggregate of the Loan Payments specified in Section 4.01 of the Series 2006 Loan Agreement, which is to be deposited
in the Loan Payment Account in the Bond Fund on each Loan Payment Date, as defined in the Series 2006 Loan Agreement, shall include amounts sufficient to redeem the principal amount of Series 2008 Bonds set forth opposite the respective dates in the
applicable tables above (less the amount of any credit as provided below). 
 Whenever Series 2008 Bonds that are Series
2008 Term Bonds are redeemed pursuant to subsection (d) below, there shall be credited by the Trustee, subject to the requirement that no Series 2008 Bonds may be in a denomination less than $100,000, towards the amount of each annual mandatory
sinking fund requirement (“Sinking Fund Amount”) to become due on such Series 2008 Term Bond after such redemption, an amount, in so far as practicable, bearing the same ratio to each annual Sinking Fund Amount as the total
principal amount of such Series 2008 Term Bonds so redeemed bears to the total principal amount of such Series 2008 Term Bonds Outstanding before such redemption (after the deduction of any such amounts previously credited toward the same or the
original amount of any such Sinking Fund Amount if no such amount shall have been credited toward the same). After giving effect to all such credits, the Trustee shall advise the Company of the unsatisfied balance of Sinking Fund Amount for each
future December 1. 
 The Issuer at the request of the Company, or the Company on behalf of the Issuer, shall have the
option to deliver to the Registrar for cancellation Series 2008 Bonds that are Series 2008 Term Bonds, in any aggregate principal amount and to receive a credit against the then current mandatory sinking fund requirement (and corresponding mandatory
redemption obligation) of the Issuer as set forth in the applicable table above for such Series 2008 Term Bonds. That option shall be exercised by the Issuer at the request of the Company, or the Company on behalf of the Issuer, if at all, on or
before the 45th day preceding the applicable mandatory redemption date, by furnishing the Trustee a certificate, executed by the Authorized Official or the Authorized Company Representative, as the case may be, setting forth the extent of the credit
to be applied with respect to the then current mandatory sinking fund requirement. If the certificate is not timely furnished to the Trustee, the mandatory sinking fund requirement (and corresponding mandatory redemption obligation) shall not be
reduced. A credit against the then current mandatory sinking fund requirement (and corresponding mandatory redemption obligation) also shall be received by the Issuer for any Series 2008 Bond that is a Series 2008 Term Bond, which prior thereto have
been redeemed (other than through the operation of the mandatory sinking fund requirements) or purchased for cancellation and canceled by the Trustee, to the extent not applied theretofore as a credit against any redemption obligation. 

  
 7 

 Each Series 2008 Bond so delivered, or previously redeemed, or purchased and
canceled, shall be credited by the Trustee at 100 percent of the principal amount thereof against the then current mandatory sinking fund obligation relating thereto. Any excess of that amount over the then current mandatory sinking fund requirement
shall be credited against subsequent mandatory sinking fund redemption obligations in the order directed by the Company. 

(b)        Extraordinary Optional
Redemption.        The Series 2008 Bonds are also subject to redemption by the Issuer in the event of the exercise by the Company of its option to direct redemption upon occurrence of any of the events
described in Section 6.2 of the Series 2006 Loan Agreement, (i) at any time in whole, or (ii) on any Interest Payment Date in inverse order of maturity, in part, as provided in Section 6.2 of the Series 2006 Loan Agreement, at a
redemption price of 100% of the principal amount redeemed, plus interest accrued to the redemption date. 

(c)        Mandatory Redemption upon a Determination of
Taxability.        Upon the occurrence of a Determination of Taxability for any reason, the Series 2008 Bonds are subject to mandatory redemption in whole by the Issuer from the proceeds of the Company
paying advance Loan Payments pursuant to Sections 4.1 and 6.3 of the Series 2006 Loan Agreement at a redemption price equal to 103 percent (103%) of the outstanding principal amount thereof, plus interest accrued to the redemption date, at the
earliest practicable date selected by the Trustee, after consultation with the Company, but in no event later than 180 days following the Trustee’s notification of the Determination of Taxability. 

Promptly following its receipt of notice of the occurrence of a Determination of Taxability, the Trustee shall notify the
Company and the Issuer of the Company’s obligations under the Agreement and as to the existence of said event and shall demand payment of the additional amount with respect to such event. Upon receipt by the Trustee from the Company or the
Issuer of such additional amount, the Trustee shall pay such additional amount to the former Holders entitled thereto by check or draft mailed to those Holders at their addresses as they last appeared on the Register. 

The Company’s obligations to make payments under the Series 2006 Loan Agreement, as amended by the First Amendment to
Loan Agreement to provide funds therefor to the Trustee for the account of the Issuer shall survive the discharge and satisfaction of this Second Supplemental Indenture and the expiration, termination, discharge or satisfaction of the Series 2006
Loan Agreement, as amended by the First Amendment to Loan Agreement. The duties of the Trustee under this Subsection (and all powers provided for herein which are necessary to carry out the intention of this Subsection) shall survive the discharge
and satisfaction of this Second Supplemental Indenture, and the Company shall be obligated to pay to the Trustee, on behalf of the Issuer, the reasonable fees and actual expenses of the Trustee with respect to the performance of such duties.
Following the discharge and satisfaction of this Second Supplemental Indenture and prior to the expiration of a 365 day-period, any former Holder (to the extent adversely affected by the Determination of Taxability) shall be entitled to enforce its
rights under this Subsection directly against the Company and the Issuer if the Trustee fails to perform the duties described in this Second Supplemental Indenture, provided that recovery may 

  
 8 

 
be had against the Issuer only out of the sources specified in the Series 2008 Bonds and this Second Supplemental Indenture. 

All of the Series 2008 Bonds outstanding on the redemption date selected shall be redeemed by the Issuer on that date, except
that Series 2008 Bonds maturing prior to that date, but after selection of the redemption date, shall be retired on their maturity date at the same price as if they had been called for redemption on the redemption date, and Series 2008 Bonds for the
payment or redemption of which sufficient moneys or investments are held by the Trustee as provided in Section 9.02 of the Series 2006 Indenture, shall be redeemed on the redemption date, or paid at earlier maturity, in accordance with this
paragraph and not otherwise. 
 (d)        Optional
Redemption.        The Series 2008 Bonds maturing on December 1, 2018 are not subject to optional redemption prior to their stated maturity. Unless previously redeemed, the Series 2008 Bonds
maturing on December 1, 2038 are subject to redemption at the option of the Issuer, upon the direction of the Company in whole at any time or in part on any Interest Payment Date on or after December 1, 2018 (from funds other than those
deposited in accordance with the mandatory sinking fund requirements of Section 2.02(a) hereof), at redemption price equal to the principal amount redeemed, plus interest accrued to the redemption date. 

Section 2.03.    Partial
Redemption.        (a) If fewer than all of the Series 2008 Bonds of a single maturity are to be redeemed, the selection of Series 2008 Bonds to be redeemed, or portions thereof in amounts of $100,000
or any integral multiple of $5,000 shall be made by lot by the Trustee in any manner which the Trustee may determine. 
 In
the case of a partial redemption of Series 2008 Bonds when Series 2008 Bonds of denominations greater than $100,000 are then outstanding, each $5,000 unit of face value of principal thereof shall be treated as though it were a separate Series 2008
Bond of the denomination of $5,000. 
 (b)        If it is
determined that less than all of the principal amount of a Series 2008 Bond is to be called for redemption, then upon notice of redemption, the Holder of that Series 2008 Bond shall surrender the Series 2008 Bond to the Trustee (a) for payment
of the redemption price of the portion of the Series 2008 Bond in $5,000 multiples called for redemption (including without limitation, the interest accrued to the date fixed for redemption and any premium), and (b) for issuance, without charge
to the Holder thereof, of a new Series 2008 Bond or Series 2008 Bonds of the same series, of any authorized denomination or denominations in an aggregate principal amount equal to the unmatured and unredeemed portion of, and bearing interest at the
same rate and maturing on the same date as, the Series 2008 Bond surrendered. 

Section 2.04.    Election to Redeem.        Except in
the case of redemption pursuant to any mandatory sinking fund requirements or pursuant to other mandatory redemption provisions, Series 2008 Bonds shall be redeemed only by written notice from the Issuer to the Trustee, given at the direction of the
Company, or by written notice from the Company to the Trustee on behalf of the Issuer. That notice shall specify the redemption date and the principal amount of each maturity of Series 2008 Bonds to be redeemed, and shall be given at least 45 days
prior to the 

  
 9 

 
redemption date or such shorter period as shall be acceptable to the Trustee. In the event that notice of redemption shall have been given by the Trustee to the Holders as provided in
Section 2.05 hereof, there shall be deposited with the Trustee prior to the redemption date, funds which, in addition to any other moneys available therefor and held by the Trustee, will be sufficient to redeem at the redemption price thereof,
plus interest accrued to the redemption date, all of the redeemable Series 2008 Bonds for which notice of redemption has been given. 

Section 2.05.    Notice of Redemption.        The
notice of the call for redemption of Series 2008 Bonds shall identify (i) by designation, letters, numbers or other distinguishing marks, the Series 2008 Bonds or portions thereof to be redeemed, (ii) the redemption price to be paid,
(iii) the date fixed for redemption, and (iv) the place or places where the amounts due upon redemption are payable. 

The notice shall be given by the Trustee on behalf of the Issuer by mailing a copy of the redemption notice by first class
mail, postage prepaid, at least 30 days prior to the date fixed for redemption, to the Holder of each Series 2008 Bond subject to redemption in whole or in part at the Holder’s address shown on the Register on the fifteenth day preceding that
mailing. Failure to receive notice so mailed or any defect in that notice regarding any Series 2008 Bond, however, shall not affect the validity of the proceedings for the redemption of any series 2008 Bond. Any notice of redemption may state
conditions to such redemption not inconsistent with the Series 2006 Indenture. 

Section 2.06.    Payment of Redeemed
Bonds.        Notice having been mailed in the manner provided in Section 2.05 of the Series 2006 Indenture, the Series 2008 Bonds and portions thereof called for redemption shall become due and
payable on the redemption date, and upon presentation and surrender thereof at the place or places specified in that notice, shall be paid at the redemption price, plus interest accrued to the redemption date. 

If money for the redemption of all of the Series 2008 Bonds and portions thereof to be redeemed, together with interest
accrued thereon to the redemption date, is held by the Trustee on the redemption date, so as to be available therefor on that date and if notice of redemption has been deposited in the mail as aforesaid, then from and after the redemption date those
Series 2008 Bonds and portions thereof called for redemption shall cease to bear interest and no longer shall be considered to be outstanding hereunder. If those moneys shall not be so available on the redemption date, or that notice shall not have
been deposited in the mail as aforesaid, those Series 2008 Bonds and portions thereof shall continue to bear interest, until they are paid, at the same rate as they would have borne had they not been called for redemption. 

All moneys deposited in the Bond Fund and held by the Trustee for the redemption of particular Bonds shall be held in trust
for the account of the Holders thereof and shall be paid to them, respectively, upon presentation and surrender of those Bonds. 

Section 2.07.    Delivery of Moneys for Optional
Redemption.        Nothing herein or in the Series 2006 Loan Agreement is intended to prevent the Company from delivering moneys to the Trustee for the purchase or redemption of Series 2008 Bonds in
accordance herewith. 

  
 10 

 Subject to the provisions of Section 2.04 hereof, if the Trustee is provided
at any time with moneys (i) which are sufficient, together with moneys, including without limitation, investments, then in the Bond Fund, Bond Reserve Fund and Project Fund to redeem a principal amount of Outstanding Series 2008 Bonds which
will be subject to redemption on the next available date on which Series 2008 Bonds may be redeemed; and (ii) which in the aggregate, together with those other moneys, are not less than $100,000, then the Trustee upon the written request of the
Authorized Company Representative shall make available from such Funds the amount required to accomplish the redemption, together with the other moneys provided, so long as the balance remaining thereafter in each Fund, and each Account therein, is
not reduced thereby below the amount which would be required hereby to be on deposit therein on the redemption date with respect to the Series 2008 Bonds which will not be redeemed. 

Section 2.08. Variation of Redemption Provisions.        The provisions of
this Article II, insofar as they apply to any series of Additional Bonds, may be varied by the Supplemental Indenture providing for that series, subject to the requirements of Section 8.03(b) of the Series 2006 Indenture if any such amendment
creates a priority of any one Series 2008 Bond over another Series 2008 Bond for purposes of a redemption pursuant to Section 2.02(d) hereof. 

Section 2.09. Initial Delivery of the Series 2008 Bonds; Deposit of
Proceeds.        (a) Upon the execution and delivery of this Second Supplemental Indenture and satisfaction of the conditions established by the Issuer and in the Purchase Contract for delivery of the
Series 2008 Bonds, the Issuer shall execute (but need not prepare) the Series 2008 Bonds in typewritten form and deliver them to the Trustee. Thereupon, the Trustee shall authenticate the Series 2008 Bonds and deliver them to, or on the order of,
the Original Purchaser thereof, as directed by the Issuer in accordance with this Section 2.09. 

(b)        Before the Trustee delivers any Series 2008 Bonds, the Trustee shall have
received: 
 (i)        a request and authorization to the Trustee
on behalf of the Issuer, signed by the Authorized Official, to authenticate and deliver the Series 2008 Bonds to, or on the order of, the Original Purchaser upon payment to the Trustee of the amount specified therein, any accrued interest, which
amount shall be deposited as provided below; 
 (ii)        a copy
of the Bond Legislation, certified by an officer of the Legislative Authority; 

(iii)        executed counterpart of the Second Supplemental
Indenture, the Second Amendment to Loan Agreement and the Intercreditor Agreement; 

(iv)        an original executed Series 2008 Project Note; 

(v)        Opinion of Kutak Rock LLP, Bond Counsel, to the effect
that the interest on the Series 2008 Bonds is excluded from the gross income for federal income tax purposes and such other matters as shall be reasonably required by the Issuer and the Original Purchaser; 

  
 11 

 (vi)        an amount of
money so that the Reserve Fund Value shall be at least equal to the Reserve Fund Requirement or in lieu thereof a Reserve Fund Surety; and 

(vii)        executed counterpart of the Security Agreement. 

(c)        The Trustee shall deposit the proceeds of the Series 2008 Bonds
($24,181,750, representing $24,550,000 principal amount of Series 2008 Bonds, and less Underwriter’s discount of $368,250) as follows: 

(i)        $122,750, from proceeds of the Series 2008 Bonds, together
with a Company contribution of $147,925, into the Cost of Issuance Account of the Series 2008 Project Fund, which shall be used by the Trustee to pay the costs of issuance associated with the initial issuance, sale and delivery of the Series 2008
Bonds as shown on Exhibit B hereto, upon receipt of an invoice from the payee; 

(ii)        $2,222,125 into the Bond Reserve Fund; and 

(iii)         the balance, $21,836,875 into the Series 2008
Construction Account of the Series 2008 Project Fund. 
 The Trustee shall be permitted to rely upon the opinions described
in (v) above. 
 Section 2.10. Creation of the Series 2008 Project
Fund.        There is created and ordered maintained as a separate deposit (except when invested as provided in the Indenture) in the custody of the Trustee, a trust fund designated “The Industrial
Development Authority of the County of Pima – Global Water Resources, LLC Series 2008 Project Fund” and the “Series 2008 Construction Account” and the “Series 2008 Cost of Issuance Account” therein. 

Section 2.11. Disbursements from and Records of Series 2008 Project
Fund.        Moneys in the Series 2008 Project Fund shall be disbursed in accordance with the provisions of the Section 3.2 of the Second Amendment to Loan Agreement and Section 2.09(c) hereof.
The Trustee shall cause to be kept and maintained adequate records pertaining to the Series 2008 Project Fund and all disbursements therefrom and shall provide monthly statements as to the accounts held hereunder to the Company. After ninety
(90) days from the date of delivery of the Bonds, any amounts still on deposit in the Series 2008 Cost of Issuance Account shall be transferred to the Bond Fund. 

Unless otherwise provided in the applicable Bond Legislation or Supplemental Indenture, this Section shall apply to the
disbursement of the proceeds of any issue of Additional Bonds 
 Section 2.12. Completion of the Series 2008
Project.         The completion of the Series 2008 Project and payment of all costs and expenses incident thereto shall be evidenced by the filing with the Trustee of 

(a)        the certificate of the Authorized Company Representative
required by Section 3.6 of the Series 2006 Loan Agreement, and 

  
 12 

 (b)        a certificate
signed by the Authorized Company Representative stating that all obligations and costs in connection with the Series 2008 Project and payable out of the Series 2008 Construction Account have been paid and discharged, except for amounts retained by
the Trustee as provided under the Second Amendment to Loan Agreement for the payment of costs of the Series 2008 Project not then due and payable. 

As soon as practicable after the filing with the Trustee of the certificate to which reference is made in clause (b) above, any balance
remaining in the Series 2008 Project Fund (other than the amounts retained by the Trustee as described in the preceding sentence) shall be deposited or applied in accordance with the direction of the Authorized Company Representative pursuant to
Section 3.2 of the Second Amendment to Loan Agreement. 
 Unless otherwise provided in the applicable Bond Legislation
or Supplemental Indenture, this Section shall apply to any additional property financed with the proceeds of any issue of Additional Bonds. 

ARTICLE III 

REPRESENTATIONS; COVENANTS 

AND AGREEMENTS OF ISSUER 

Section 3.01. Covenants and Agreements of the Issuer.        In addition
to any other covenants and agreements of the Issuer contained in this Second Supplemental Indenture or the Bond Legislation, the Issuer further covenants and agrees with the Holders and the Trustee as follows: 

(a)        Payment of Bond Service Charges. The Issuer
will cause all Bond Service Charges to be paid, but solely from the sources provided herein, on the dates, at the places and in the manner provided in this Second Supplemental Indenture. The Issuer shall have no liability or obligation with respect
to the payment of the purchase price of the Series 2008 Bonds. 

(b)        Revenues and Assignment of Revenues. The
Issuer will not assign the Revenues or create or authorize to be created any debt, lien or charge thereon, other than the assignment thereof under this Second Supplemental Indenture. 

(c)        Inspection of Project Books. All books,
instruments and documents in the Issuer’s possession relating to the Series 2008 Project and the Revenues shall be open to inspection at all times during the Issuer’s regular business hours by any accountants or other agents of the Trustee
which the Trustee may designate from time to time; provided, the Trustee shall have no duty to cause such inspection. 

(d)        Rights and Enforcement of the Agreement. The
Trustee may enforce, in its name or in the name of the Issuer, all rights of the Issuer for and on behalf of the Holders, except for Unassigned Issuer’s Rights, and may enforce all covenants, agreements and obligations of the Company under and
pursuant to the Loan Agreement, regardless of whether the Issuer is in default in the pursuit or enforcement 

  
 13 

 
of those rights, covenants, agreements or obligations. Upon receipt of the written request of the Authorized Company Representative or of the Trustee and at the Company’s expense, the
Issuer, however, will do all things and take all actions on its part necessary to comply with covenants, agreements, obligations, duties and responsibilities on its part to be observed or performed under the Loan Agreement and will take all actions
within its authority to keep the Loan Agreement in effect in accordance with the terms thereof. 

(e)        Issuer Not to Adversely Affect Exclusion From Gross
Income of Interest on Series 2008 Bonds. 
 The Issuer agrees: 

(a)        it shall neither make nor direct the Trustee to make any
investment or other use of the proceeds of the Series 2008 Bonds that would cause the Series 2008 Bonds to be “arbitrage bonds” as that term is defined in Section 148(a) of the Code and that it shall comply with the requirements of
the Code throughout the term of the Series 2008 Bonds; and 

(b)        it (i) shall take, or use its best efforts to require
to be taken, all actions that may be required of the Issuer for the interest on the Series 2008 Bonds to be and remain not included in gross income for federal income tax purposes and (ii) shall not take or authorize to be taken any actions
within its control that would adversely affect that status under the provisions of the Code; 
 In furtherance of the
covenants in this Section, the Issuer and the Borrower shall execute, deliver and comply with the provisions of the Tax Certificate, which is by this reference incorporated into this Second Supplemental Indenture and made a part of this Second
Supplemental Indenture, and by its acceptance of this Second Supplemental Indenture the Trustee acknowledges receipt of the Tax Certificate and acknowledges its incorporation into this Second Supplemental Indenture by this reference. The Trustee
agrees that in those instances where it exercises discretion over the investment of funds, it shall not knowingly make any investment inconsistent with subsection (a). 

Section 3.02. Observance and Performance of Covenants, Agreements, Authority and
Actions.        The Issuer covenants it will observe and perform faithfully at all times all covenants, agreements, authority, actions, undertakings, stipulations and provisions to be observed or performed
on its part under the Second Amendment to Loan Agreement, this Second Supplemental Indenture, the Bond Legislation and the Series 2008 Bonds which are executed, authenticated and delivered under this Second Supplemental Indenture, and under all
proceedings of its Legislative Authority pertaining thereto; provided, however, that (a) the Issuer shall not be obligated to take any action or execute any instrument pursuant to any provision hereof until it shall have been requested to do so
by the Company or by the Trustee, and (b) the Issuer shall have received the instrument to be executed, and at the Issuer’s option shall have received from the Company assurance satisfactory to the Issuer that the Issuer shall be
reimbursed for its reasonable expenses incurred or to be incurred in connection with taking such action or executing such instrument. 

  
 14 

 The Issuer represents and warrants that it is duly authorized by the Constitution
and laws of the State, including particularly and without limitation the Act, to issue the Series 2008 Bonds, to execute and deliver this Second Supplemental Indenture and the Second Amendment to Loan Agreement and to provide the security for
payment of the Bond Service Charges in the manner and to the extent set forth in this Second Supplemental Indenture. 
 The
Issuer covenants that it will do, execute, acknowledge, and deliver, or cause to be done, executed, acknowledged, and delivered by the parties within its control, such instruments supplemental hereto and such further acts, instruments, and transfers
as the Trustee may reasonably require for the better assuring, transferring, mortgaging, conveying, pledging, assigning, and confirming unto the Trustee, the Issuer’s interest in and to all interests, Revenues, proceeds, and receipts pledged
hereby to the payment of the principal of, premium, if any, and interest on the Series 2008 Bonds in the manner and to the extent contemplated herein. The Issuer shall be under no obligation to prepare, record, or file any such instruments or
transfers. 
 Section 3.03. Enforcement of Issuer’s
Obligations.        Each obligation of the Issuer required to be undertaken pursuant to the Bond Legislation, this Second Supplemental Indenture, the Second Amendment to Loan Agreement and the Series 2008
Bonds is binding upon the Issuer, and upon each officer or employee thereof as may have from time to time the authority under law to take any action on behalf of the Issuer which may be necessary to perform all or any part of that obligation, as a
duty of the Issuer and of each of those officers and employees providing for enforcement by writ of mandamus. 

Section 3.04. Reliance by Issuer on Facts or Certificates, Limitations on
Actions.        Anything in this Second Supplemental Indenture to the contrary notwithstanding, it is expressly understood and agreed by the parties hereto that (i) the Issuer may rely conclusively on
the truth and accuracy of any certificate, opinion, notice, or other instrument furnished to the Issuer by the Trustee or the Company as to the existence of any fact or state of affairs required hereunder to be noticed by the Issuer; (ii) the
Issuer shall not be under any obligation hereunder to perform any record keeping or to provide any legal services, it being understood that such services shall be performed either by the Trustee or the Company and (iii) none of the provisions
of this Second Supplemental Indenture shall require the Issuer to expend or risk its own funds or to otherwise incur financial liability in the performance of any of its duties or in the exercise of any of its rights or powers hereunder, unless it
shall first have been adequately indemnified to its satisfaction against the cost, expense, and liability which may be incurred thereby. 

Section 3.05. Immunity of Issuer’s Directors, Officers, Counsel, Financial Advisors, and
Agents.        No recourse shall be had for the enforcement of any obligation, covenant, promise, or agreement of the Issuer contained in this Second Supplemental Indenture, the Second Amendment to Loan
Agreement, the Purchase Contract, any Series 2008 Bond and any other agreement, certificate, contract or instrument to be executed by the Issuer in connection with the issuance of the Series 2008 Bonds (collectively, the “Series 2008 Issuer
Documents”) or in any Series 2008 Bond or for any claim based hereon or otherwise in respect hereof or upon any obligation, covenant, promise, or agreement of the Issuer contained in any agreement, instrument, or certificate executed in
connection with the Series 2008 Project or the issuance and sale of the Series 2008 Bonds, against any Issuer Indemnified Parties, whether by virtue of any Constitutional provision, statute, or rule of law, or by the enforcement of any assessment or

  
 15 

 
penalty or otherwise; it being expressly agreed and understood that no personal liability whatsoever shall attach to, or be incurred by, any Issuer Indemnified Parties, either directly or by
reason of any of the obligations, covenants, promises, or agreements entered into between the Issuer and the Trustee or Company to be implied therefrom as being supplemental hereto or thereto, and that all personal liability of that character
against every such director, officer, counsel, financial advisor, or agent, is, by the execution of the Series 2008 Issuer Documents, and as part of the consideration for, the execution of the Series 2008 Issuer Documents, expressly waived and
released. 
 Section 3.06. No Pecuniary Liability of the
Issuer.        No agreements or provisions contained herein nor any agreement, covenant, or undertaking by the Issuer in connection with the Series 2008 Project or the issuance, sale, and/or delivery of
the Series 2008 Bonds shall give rise to any pecuniary liability of the Issuer or a charge against its general credit, or shall obligate the Issuer financially in any way, except as may be payable from the revenues pledged hereby for the payment of
the Series 2008 Bonds and their application as provided in the Second Amendment to Loan Agreement or this Second Supplemental Indenture. No failure of the Issuer to comply with any term, covenant, or agreement contained in the Series 2008 Bonds, the
Second Amendment to Loan Agreement, this Second Supplemental Indenture, or in any document executed by the Issuer in connection with the Series 2008 Project or the issuance and sale of the Series 2008 Bonds, shall subject the Issuer to liability for
any claim for damages, costs, or other financial or pecuniary charge, except to the extent that the same can be paid or recovered from the Revenues pledged for the payment of the Series 2008 Bonds or other revenues derived under the Second Amendment
to Loan Agreement or this Second Supplemental Indenture. Nothing herein shall preclude a proper party in interest from seeking and obtaining, to the extent permitted by law, specific performance against the Issuer for any failure to comply with any
term, condition, covenant, or agreement herein; provided that no costs, expenses, or other monetary relief shall be recoverable from the Issuer, except as may be payable from the Revenues pledged in the Second Amendment to Loan Agreement or this
Second Supplemental Indenture for the payment of the Series 2008 Bonds or other Revenues derived under the Second Amendment to Loan Agreement or this Second Supplemental Indenture. No provision, covenant, or agreement contained herein, or any
obligations imposed upon the Issuer, or the breach thereof, shall constitute an indebtedness of the Issuer within the meaning of any State constitutional or statutory limitation or shall constitute or give rise to a charge against its general
credit. In making the agreements, provisions, and covenants set forth in this Second Supplemental Indenture, the Issuer has not obligated itself, except with respect to the application of the Revenues pledged in the Indenture for the payment of the
Series 2008 Bonds or other revenues derived under the Second Amendment to Loan Agreement or this Second Supplemental Indenture. 

Section 3.07. Acceptance by Trustee of Duties Under Agreement.        By
its execution hereof, the Trustee approves and accepts hereby all rights, remedies, powers, privileges, duties and obligations which are contemplated in the Loan Agreement to be rights, remedies, powers, privileges, duties or obligations of the
Trustee with respect to the Series 2008 Bonds and covenants and agrees to observe and perform those duties and obligations and to exercise those rights, remedies, powers and privileges as contemplated in the Second Amendment to Loan Agreement and
herein. The Trustee is authorized and directed to execute in its capacity as Trustee, the Intercreditor Agreement and the Security Agreement. 

  
 16 

 ARTICLE IV 

MISCELLANEOUS 

Section 4.01. Effect of Second Supplemental Indenture.        Except as
specifically amended hereby, the Series 2006 Indenture and the First Supplemental Indenture shall continue in full force and effect. 

Section 4.02. Severability.        If any provision of this Second
Supplemental Indenture shall be held or deemed to be or shall, in fact, be illegal, inoperative or unenforceable, the same shall not affect any other provision or provisions herein contained or render the same invalid inoperative or enforceable to
any extent whatever 
 Section 4.03. Contrary Provisions
Deleted.        Any provisions of the Series 2006 Indenture as supplemented by the First Supplemental Indenture, prior to its amendment by this Second Supplemental Indenture, which conflict with this
Second Supplemental Indenture are hereby deleted and of no force and effect. 
 Section 4.04. Execution in Several
Counterparts.        This Second Supplemental Indenture may be executed in several counterparts, each of which shall be an original and is complete in itself and may be introduced in evidence, proved,
recorded or used for any other purpose without the production of any other counterpart. 
 Section 4.05. Conflict of
Interest.        To the extent A.R.S. §38-511 is applicable, all parties acknowledge that the Issuer may, within three years after its execution, cancel this Second Supplemental Indenture, without
penalty or further obligation, if any person significantly involved in initiating, negotiating, securing, drafting, or creating of this Second Supplemental Indenture on behalf of the Issuer, is, at any time while this Second Supplemental Indenture
is in effect, an employee or agent of any other party in any capacity or a consultant to any other party to this Second Supplemental Indenture with respect to the subject matter of this Second Supplemental Indenture and the Issuer may recoup any fee
or commission paid or due any person significantly involved in initiating, negotiating, securing, drafting, or creating this Second Supplemental Indenture on behalf of the Issuer, all as provided in Section §38-511, Arizona Revised Statutes, as
amended. 
 Each party represents that to the best of its knowledge, it is not in violation of A.R.S. §38-511 as of the
date hereof. The Trustee covenants not to knowingly employ as an employee, an agent, consultant, any person significantly involved in initiating, negotiating, securing, drafting or creating this Second Supplemental Indenture on behalf of the Issuer
within 3 years from execution of this Second Supplemental Indenture, unless a waiver of A.R.S. §38-511 is provided by the Board of Directors of the Issuer. 

Section 4.06. Binding Effect.        This Second Supplemental Indenture
shall inure to the benefit of and shall be binding upon the Issuer and the Trustee and their respective successors and assigns, subject, however, to the limitations contained herein. 

  
 17 

 IN WITNESS WHEREOF, the Issuer has caused this Second Supplemental Indenture to
be executed and delivered for it and in its name and on its behalf by its duly authorized officers; in token of its acceptance of the trusts created hereunder and the duties and obligations of the Trustee hereunder, the Trustee has caused this
Second Supplemental Indenture to be executed and delivered for it and in its name and on its behalf by its duly authorized officers all as of the day and year first above written. 

 

			
	THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF PIMA, as Issuer
		
	By:	 	/s/ Stanley Lehman
	Name:	 	Stanley Lehman
	Title:	 	Vice President

  

			
	U.S. BANK NATIONAL ASSOCIATION, as Trustee
		
	By:	 	 
	Name:	 	Brenda D. Black
	Title:	 	Vice President

 CONSENT OF THE COMPANY 

The undersigned hereby consents to the execution and delivery of this Second Supplemental Trust Indenture and to the amendments made herein.

  

									
	 Dated: September     , 2008
	 		 	GLOBAL WATER RESOURCES, LLC
		 		 		 	By:	 	 
		 		 		 	Name:	 	Trevor T. Hill
		 		 		 	Title:	 	President/CEO

  

 IN WITNESS WHEREOF, the Issuer has caused this Second Supplemental Indenture to
be executed and delivered for it and in its name and on its behalf by its duly authorized officers; in token of its acceptance of the trusts created hereunder and the duties and obligations of the Trustee hereunder, the Trustee has caused this
Second Supplemental Indenture to be executed and delivered for it and in its name and on its behalf by its duly authorized officers all as of the day and year first above written. 

 

			
	 THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF PIMA,

as Issuer

		
	By:	 	 
	Name:	 	Stanley Lehman
	Title:	 	Vice President

  

			
	U.S. BANK NATIONAL ASSOCIATION, as Trustee
		
	By:	 	/s/ Brenda D. Black
	Name:	 	Brenda D. Black
	Title:	 	Vice President

 CONSENT OF THE COMPANY 

The undersigned hereby consents to the execution and delivery of this Second Supplemental Trust Indenture and to the amendments made herein.

  

									
	 Dated: October 1, 2008
	 		 	GLOBAL WATER RESOURCES, LLC
		 		 		 	By:	 	 
		 		 		 	Name:	 	Trevor T. Hill
		 		 		 	Title:	 	President/CEO

 IN WITNESS WHEREOF, the Issuer has caused this Second Supplemental Indenture to
be executed and delivered for it and in its name and on its behalf by its duly authorized officers; in token of its acceptance of the trusts created hereunder and the duties and obligations of the Trustee hereunder, the Trustee has caused this
Second Supplemental Indenture to be executed and delivered for it and in its name and on its behalf by its duly authorized officers all as of the day and year first above written. 

 

			
	 THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF PIMA,

as Issuer

		
	By:	 	 
	Name:	 	Stanley Lehman
	Title:	 	Vice President

  

			
	U.S. BANK NATIONAL ASSOCIATION, as Trustee
		
	By:	 	 
	Name:	 	Brenda D. Black
	Title:	 	Vice President

 CONSENT OF THE COMPANY 

The undersigned hereby consents to the execution and delivery of this Second Supplemental Trust Indenture and to the amendments made herein.

  

									
	 Dated: August 1, 2008
	 		 	GLOBAL WATER RESOURCES, LLC
					
		 		 		 	By:	 	/s/ Trevor T. Hill
		 		 		 	Name:	 	Trevor T. Hill
		 		 		 	Title:	 	President/CEO

 EXHIBIT A 

FORM OF SERIES 2008 BOND 

UNITED STATES OF AMERICA 

STATE OF ARIZONA 
 COUNTY
OF PIMA 
 REGISTERED No.              

UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (“DTC”) TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY BOND ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN. 
 [THIS BOND IS ONLY TRANSFERABLE UPON COMPLIANCE 

WITH THE RESTRICTED TERMS PROVIDED HEREIN]1 

The Industrial Development Authority 

of the County of Pima 
 Water and
Wastewater Revenue Bond 
 (Global Water Resources, LLC Project) 

Series 2008 
  

							
	Interest Rate:	 	Maturity Date:	 	Dated:	 	CUSIP:
	         % per annum
	 	December 1, 20    	 	October 1, 2008	 	

  
  

 

  

 REGISTERED OWNER:         CEDE & CO. 

PRINCIPAL AMOUNT: 
 The
Industrial Development Authority of the County of Pima (the “Issuer”), a nonprofit corporation designated a political subdivision of the State of Arizona (the “State”), pursuant to the provisions of
the Constitution of the State and under Title 35, Chapter 5, Arizona Revised Statutes, as amended and supplemented (the “Act”), for value received, promises to pay to “Registered Owner” specified above or registered
assigns, but solely from the sources and in the manner referred to herein, the “Principal Amount” specified above on the Maturity Date set forth above, unless this Bond is called for earlier redemption, and to pay from those sources
interest thereon at the aforesaid Interest Rate on June 1 and December 1 of each year, commencing June 1, 2009 (the “Interest Payment Dates”), until the principal amount is paid or duly provided for. This Bond
will bear interest from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from the date of its original issuance and delivery. Interest on this Bond shall be calculated
on the basis of a 360 day year consisting of twelve (12) months of thirty (30) days. 
 The principal of and any
premium on this Series 2008 Bond are payable upon presentation and surrender hereof at the principal corporate trust office of the trustee, initially U.S. Bank National Association, Phoenix, Arizona (the “Trustee”).
Interest is payable on each Interest Payment Date by check or draft mailed to the person in whose name this Bond (or one or more predecessor bonds) is registered (the “Holder”) at the close of business on the 15th
day of the calendar month next preceding that Interest Payment Date (the “Regular Record Date”) on the registration books for this issue maintained under the Trust Indenture dated as of December 1, 2006, between the
Issuer and the Trustee (the “Series 2006 Indenture”), as supplemented by a First Supplemental Trust Indenture, dated as of November 1, 2007 (the “First Supplemental Indenture”), as further supplemented by a Second
Supplemental Trust Indenture, dated as of August 1, 2008 (the “Second Supplemental Indenture” and together with the Series 2006 Indenture and the First Supplemental Indenture, the “Indenture”). Any payment of principal of,
premium and interest on the Series 2008 Bonds shall be made by the Trustee by wire transfer to any Holder of $1,000,000 or more in aggregate principal amount of Series 2008 Bonds upon receipt of written notice from such a Holder requesting such
payment at least 15 days prior to the payment date. Any interest which is not timely paid or duly provided for shall cease to be payable to the Holder hereof (or of one or more predecessor bonds) as of the Regular Record Date, and shall be payable
to the Holder hereof (or of one or more predecessor bonds) at the close of business on a Special Record Date to be fixed by the Trustee for the payment of that overdue interest. Notice of the Special Record Date shall be mailed to Holders not less
than ten days prior thereto. The principal of and interest and any premium on this Series 2008 Bond are payable in lawful money of the United States of America, without deduction for the services of the paying agent. 

This Bond is one of a duly authorized issue of the Issuer’s Water and Wastewater Revenue Bonds (Global Water Resources,
LLC Project) Series 2008 (the “Series 2008 Bonds”), issuable under the Series 2006 Indenture, as supplemented by the First Supplemental Indenture and as further supplemented by the Second Supplemental Indenture, aggregating in principal
amount $24,550,000 and issued for the purpose of making a loan (the “Series 2008 Loan”) to 

  
 A-2 

 
assist Global Water Resources, LLC (the “Company”) in the financing of costs of the Series 2008 Project, as defined in the Loan Agreement dated as of December 1, 2006 among the
Issuer, the Trustee and the Company (the “Series 2006 Loan Agreement”), as amended by the First Amendment to Loan Agreement, dated as of November 1, 2007 (the “First Amendment to Loan Agreement”), as amended by the Second
Amendment to Loan Agreement, dated as of August 1, 2008 (the “Second Amendment to Loan Agreement” and together with the Series 2006 Loan Agreement and the First Amendment to Loan Agreement, the “Loan Agreement”). The Series
2008 Bonds are secured under the Indenture, on a parity with the $36,495,000 principal amount of the Issuer’s Water and Wastewater Revenue Bonds (Global Water Resources, LLC Project) Series 2006 (the “Series 2006 Bonds”) and the
$54,135,000 principal amount of the Issuer’s Water and Wastewater Revenue Bonds (Global Water Resources, LLC Project) Series 2007 (the “Series 2007 Bonds”) previously issued thereunder. The Series 2006 Bonds, the Series 2007 Bonds,
the Series 2008 Bonds, together with any Additional Bonds which may be issued on a parity therewith under the Indenture (collectively, the “Bonds”), are special limited obligations of the Issuer, issued or to be issued under and are
to be secured and entitled equally and ratably to the protection given by the Series 2006 Indenture, as supplemented by the First Supplemental Indenture, and as further supplemented by the Second Supplemental Indenture. The Series 2008 Bonds are
issued pursuant to Title 35, Chapter 5 of the Arizona Revised Statutes, as amended, and to the laws of that State, and to a resolution duly enacted by the Board of Directors of the Issuer. 

NEITHER THE BOARD MEMBERS OF THE ISSUER NOR ANY PERSON EXECUTING THE SERIES 2008 BONDS IS PERSONALLY LIABLE ON THE SERIES 2008
BONDS OR SUBJECT TO ANY PERSONAL LIABILITY OR ACCOUNTABILITY BY REASON OF THEIR ISSUANCE. THE SERIES 2008 BONDS AND THE INTEREST THEREON ARE SPECIAL LIMITED OBLIGATIONS OF THE ISSUER PAYABLE EXCLUSIVELY FROM REVENUES AND RECEIPTS PLEDGED UNDER THE
INDENTURE. THIS SERIES 2008 BOND DOES NOT CONSTITUTE AN INDEBTEDNESS, AN OBLIGATION OR A LOAN OF CREDIT OR A PLEDGE OF THE FULL FAITH, AND CREDIT OR TAXING POWER OF THE ISSUER OR THE STATE OF ARIZONA, COUNTY OF PIMA OR ANY OTHER MUNICIPALITY, CITY
OR OTHER MUNICIPAL OR POLITICAL CORPORATION OR SUBDIVISION OF THE STATE OF ARIZONA WITHIN THE MEANING OF ANY STATUTORY OR CONSTITUTIONAL PROVISION AND SHALL NEVER CONSTITUTE NOR GIVE RISE TO ANY PECUNIARY LIABILITY OF THE STATE OF ARIZONA, COUNTY OF
PIMA OR ANY OTHER MUNICIPALITY, CITY, OR ANY OTHER MUNICIPAL OR POLITICAL CORPORATION OR SUBDIVISION OF THE STATE OF ARIZONA. THIS SERIES 2008 BOND DOES NOT DIRECTLY, INDIRECTLY, OR CONTINGENTLY OBLIGATE OR OTHERWISE CONSTITUTE A GENERAL OBLIGATION
OF OR A CHARGE AGAINST THE GENERAL CREDIT OF THE ISSUER, BUT SHALL BE A SPECIAL LIMITED OBLIGATION OF THE ISSUER PAYABLE SOLELY FROM THE SOURCES DESCRIBED HEREIN AND IN THE INDENTURE, BUT NOT OTHERWISE. THE ISSUER HAS NO TAXING POWER. 

NO RECOURSE SHALL BE HAD FOR THE PAYMENT OF THE PRINCIPAL, PREMIUM, IF ANY, OR INTEREST ON THIS SERIES 2008 BOND OR ANY CLAIM
BASED THEREON OR UPON ANY OBLIGATION, COVENANT, OR AGREEMENT IN THE INDENTURE, OR LOAN AGREEMENT AGAINST ANY PAST, PRESENT, OR 

  
 A-3 

 
FUTURE OFFICER, DIRECTOR, COUNSEL, FINANCIAL ADVISOR, OR AGENT OF THE ISSUER OR ANY SUCCESSOR THERETO, AS SUCH, EITHER DIRECTLY OR THROUGH THE ISSUER, OR ANY SUCCESSOR THERETO, UNDER ANY RULE OF
LAW OR EQUITY, STATUTE, OR CONSTITUTION OR BY THE ENFORCEMENT OF ANY ASSESSMENT OR PENALTY OR OTHERWISE, AND ALL SUCH LIABILITY OF ANY SUCH OFFICER, DIRECTOR, COUNSEL, FINANCIAL ADVISOR, OR AGENT, AS SUCH IS HEREBY EXPRESSLY WAIVED AND RELEASED AS A
CONDITION OF AND IN CONSIDERATION FOR THE EXECUTION OF THE SECOND SUPPLEMENTAL INDENTURE AND THE SECOND AMENDMENT TO THE LOAN AGREEMENT AND THE ISSUANCE OF THIS SERIES 2008 BOND. 

Capitalized terms not defined herein have the meaning set forth in the Indenture, as supplemented by the First Supplemental
Indenture, and as further supplemented by the Second Supplemental Indenture. As described below, the Indenture, as supplemented by the First Supplemental Indenture, and as further supplemented by the Second Supplemental Indenture and the Series 2006
Loan Agreement, as amended by the First Amendment to Loan Agreement, and as amended by the Second Amendment to Loan Agreement may be amended and references to them include any amendments. 

Reference is made to the Series 2006 Indenture, as supplemented by the First Supplemental Indenture and as supplemented by the
Second Supplemental Indenture for a more complete description of the Series 2008 Project, the provisions, among others, with respect to the nature and extent of the security for the Series 2008 Bonds, the rights, duties and obligations of the
Issuer, the Trustee and the Holders of the Series 2008 Bonds, and the terms and conditions upon which the Series 2008 Bonds are issued and secured, to the Series 2006 Loan Agreement, as amended by the First Amendment to Loan Agreement, and as
further amended by the Second Amendment to Loan Agreement for a more complete description of obligations of the Company thereunder with respect to the Series 2008 Bonds thereunder. 

Pursuant to the Series 2006 Loan Agreement, as amended by the First Amendment to Loan Agreement, and as further amended by the
Second Amendment to Loan Agreement, the Company has executed and delivered to the Trustee the Company’s promissory note dated as of October 1, 2008 (the “Series 2008 Project Note”), in the principal amount of $24,550,000.
The Company is required by the Series 2006 Loan Agreement, as amended by the First Amendment to Loan Agreement and as further amended by the Second Amendment to Loan Agreement and the Series 2008 Project Note to make payments to the Trustee in the
amounts and at the times necessary to pay the principal of and interest and any premium (the “Bond Service Charges”) on the Series 2008 Bonds. In the Indenture, as supplemented by the First Supplemental Indenture and as further
supplemented by the Second Supplemental Indenture, the Issuer has assigned to the Trustee, to provide for the payment of the Bond Service Charges on the Series 2008 Bonds, the Issuer’s right, title and interest in and to the Series 2006 Loan
Agreement, as amended by the First Amendment to Loan Agreement, and as further amended by the Second Amendment to Loan Agreement, except for Unassigned Issuer’s Rights as defined in the Loan Agreement. 

The Bond Service Charges on the Series 2008 Bonds are payable solely from the Revenues, as defined and as provided in the
Indenture (being, generally, the amounts payable under the Loan Agreement in repayment of the Loan and any unexpended proceeds of the Series 

  
 A-4 

 
2008 Bonds), and are an obligation of the Issuer only to the extent of the Revenues. The Series 2008 Bonds are not secured by an obligation or pledge of any moneys raised by taxation and do not
represent or constitute a debt or pledge of the faith and credit of the Issuer. 
 Copies of the Series 2006 Indenture, the
First Supplemental Indenture, the Second Supplemental Indenture, the Series 2006 Loan Agreement, the First Amendment to Loan Agreement, the Second Amendment to Loan Agreement and the Series 2008 Project Note are on file in the principal corporate
trust office of the Trustee. Each Holder assents, by its acceptance hereof, to all of the provisions of the Series 2006 Indenture, the First Supplemental Indenture, the Second Supplemental Indenture, the Series 2006 Loan Agreement, the First
Amendment to Loan Agreement and the Second Amendment to Loan Agreement. 
 The Series 2008 Bonds are issuable only as fully
registered bonds in the denominations of $100,000 and any integral multiple of $1,000 in excess thereof and are exchangeable for Series 2008 Bonds of other authorized denominations in equal aggregate principal amounts at the office of the Registrar
specified on the face hereof, but only in the manner and subject to the limitations provided in the Series 2006 Indenture, as supplemented by the First Supplemental Indenture and as further supplemented by the Second Supplemental Indenture. This
Series 2008 Bond is transferable at the office of the Registrar, by the Holder in person or by his attorney, duly authorized in writing, upon presentation and surrender hereof to the Registrar. 

The Registrar is not required to transfer or exchange (i) any Series 2008 Bond during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption of Series 2008 Bonds and ending at the close of business on the day of such mailing, or (ii) any Series 2008 Bonds so selected for redemption in whole or in part,
within 90 days following such mailing. 
 This Series 2008 Bond is subject to redemption as follows: 

1.         The Series 2008 Bonds are subject to mandatory sinking fund redemption at a
redemption price of 100 percent of the principal amount redeemed plus interest accrued to the redemption date, in each of the years and in the principal amount set forth in the Indenture. 

The Series 2006 Indenture, as supplemented by the First Supplemental Indenture, and as further supplemented by the Second
Supplemental Indenture provides that there shall be credited against the applicable principal amount to be redeemed by mandatory sinking redemption (“Sinking Fund Amount”) an amount bearing the same ratio to such Sinking Fund Amount
as the total principal amount of Series 2008 Bonds of such maturity redeemed bears to the total principal amount of Series 2008 Bonds outstanding of such maturity. 

2.         The Series 2008 Bonds are subject to extraordinary optional redemption by
the Issuer, at the Company’s option, if events described in Section 6.2 of the Series 2006 Loan Agreement occur (relating, generally, to damage or taking of the Project, changes in law or circumstances affecting the Project or acquisition
of the stock or assets of the Company) (a) at any time in whole, or (b) on any Interest Payment Date in part in inverse order of maturity upon condemnation of part of the Project as provided in Section 6.2 of the Series 2006 Loan

  
 A-5 

 
Agreement, in each case, at a redemption price of 100 percent of the principal amount to be redeemed plus interest accrued to the redemption date. 

3.         The Series 2008 Bonds are subject to mandatory redemption upon a
Determination of Taxability (as defined in the Indenture), at a redemption price equal to 103 percent (103%) of the principal amount thereof plus interest accrued to the redemption date, at the earliest practicable date selected by the Trustee,
after consultation with the Company, but in no event later than 180 days following the Trustee’s notification of the Determination of Taxability. 

4.         The Series 2008 Bonds maturing on December 1, 2018 are nor subject to
optional redemption prior to their stated maturity. Unless previously redeemed, the Series 2008 maturing December 1, 2038 Series 2008 Bonds are subject to redemption at the option of the Issuer, at the direction of the Company in whole at any
time or in part on any Interest Payment Date on or after December 1, 2018 (from funds other than those deposited in accordance with the mandatory sinking fund requirements of the Series 2006 Indenture, as supplemented by the First Supplemental
Indenture, and as further supplemented by the Second Supplemental Indenture), at the redemption price equal to the principal amount redeemed, plus interest accrued to the redemption date. 

If Series 2008 Bonds or portions thereof are called for redemption and if on the redemption date moneys for the redemption
thereof are held by the Trustee as provided in the Indenture, thereafter those Series 2008 Bonds or portions thereof to be redeemed shall cease to bear interest, and shall cease to be secured by, and shall not be deemed to be outstanding under, the
Indenture. 
 The Indenture permits certain amendments or supplements to the Loan Agreement, the Indenture and the Series
2008 Project Note not prejudicial to the Holders to be made without the consent of or notice to the Holders, and other amendments or supplements thereto to be made with the consent of the Holders of not less than a majority in aggregate principal
amount of the Bonds then outstanding. NOTWITHSTANDING ANY OTHER PROVISION OF THIS SERIES 2008 BOND TO THE CONTRARY, BUT EXCEPT AS OTHERWISE PROVIDED IN SECTION 2.01(e) OF THE SECOND SUPPLEMENTAL INDENTURE, THIS SERIES 2008 BOND IS NONTRANSFERABLE
UNLESS TRANSFERRED TO A QUALIFIED INVESTOR AS SET FORTH IN THE SECOND SUPPLEMENTAL INDENTURE. 
 The Holder of each Series
2008 Bond has only those remedies provided in the Indenture. 
 The Issuer, Trustee, Registrar, Authenticating Agent and any
agent thereof may treat the Registered Holder of this Series 2008 Bond as the absolute owner for the purpose of receiving payment as herein provided and for all other purposes hereunder and under the Indenture and none of them shall be affected by
any notice to the contrary. 
 The Series 2008 Bonds shall not constitute the personal obligation, either jointly or
severally, of the members of the Board of Directors or of any other officer of the Issuer. 

  
 A-6 

 This Series 2008 Bond shall not be entitled to any security or benefit under the
Indenture or be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed. 

It is certified and recited that there have been performed and have happened in regular and due form, as required by law, all
acts and conditions necessary to be done or performed by the Issuer or to have happened (i) precedent to and in the issuing of the Series 2008 Bonds in order to make them legal, valid and binding special limited obligations of the Issuer, and
(ii) precedent to and in the execution and delivery of the Second Supplemental Indenture and the Second Amendment to Loan Agreement; that payment in full for the Series 2008 Bonds has been received; and that the Series 2008 Bonds do not exceed
or violate any constitutional or statutory limitation. 

  
 A-7 

 IN WITNESS OF THE ABOVE, The Industrial Development Authority of the County of
Pima has caused this Bond to be executed in the name of the Issuer in their official capacities by the manual or facsimile signatures of the President and Secretary, as of the date shown above. 

 

			
	 THE INDUSTRIAL DEVELOPMENT

AUTHORITY OF THE COUNTY OF PIMA

	
	By:                                   
                                         
 
	Name:	 	    Stanley Lehman
	Title:	 	    Vice President

 ATTEST 
  

	
	   

	Secretary

  
 A-8 

 (FORM OF CERTIFICATE OF AUTHENTICATION) 

Date of Registration and Authentication
                                         
                   : 
 This Bond is one of the Bonds
described in the within-mentioned Indenture. 
  

			
	U.S. BANK NATIONAL ASSOCIATION, as Trustee
		
	By:	 	 
		 	    Authorized Signer

 Registrable at and payable by: U.S. Bank National Association, as Trustee 

  
 A-9 

 (FORM OF ASSIGNMENT) 

ASSIGNMENT 

The following abbreviations when used in the inscription on the face of the within Bond, shall be construed as though they
were written out in full according to applicable laws or regulations: 
 TEN COM -     as tenants in common 

TEN ENT -       as tenants by the entireties 

JT TEN -           as joint tenants with right of 

survivorship and not as tenants in common 

UNIF GIFT/TRANS MIN ACT
                         Custodian for
                         under 

(Cust.) (Minor) 
 Uniform Gifts/Transfers to Minors Act of
                                         
               . 
 (State) 

Additional abbreviations may also be used though not in list above. 

  
 A-10 

 ASSIGNMENT 

FOR VALUE RECEIVED, the undersigned
                                     (the
“Transferor”), hereby sells, assigns and transfers unto
                                     (the
“Transferee”), whose address is
                                         
                                and whose social security number (or other federal tax
identification number) is 
 PLEASE INSERT SOCIAL SECURITY OR OTHER 

IDENTIFYING NUMBER OF TRANSFEREE 
  

 
  

 
 the within Bond and all rights
thereunder, and hereby irrevocably constitutes and appoints
                                         
                    as attorney to register the transfer of the within Bond on the books kept for registration and registration of transfer thereof,
with full power of substitution in the premises. 
 Date:
                             

  
 A-11 

 SIGNATURE(S) GUARANTEED BY: 
  

							
	      
	 		 	      

	 Firm or Bank
	 		 	 NOTICE:
	 	 No transfer will be registered and no new Bond will be issued in the name of the Transferee, unless that signature(s) to this assignment correspond(s) with the
name as it appears upon the fact of the within Bond in every particular, without alteration or enlargement or any change whatever and name, address and the Social Security Number or federal employee identification number of the Transferee is
supplied.

	      
	 		 	
	 Authorized Signature
	 		 		 	
				
	 Signature guarantee should be made by a guarantor institution participating in the Securities, Transfer Agents Medallion Program or in such other program
acceptable to the Bond Registrar.
	 		 		 	

  

 EXHIBIT B 

COSTS OF ISSUANCE 
  

			
	 Party
	  	Amount
		
	 Issuer’s Counsel Fees and Expenses
	  	$25,000
		
	 IDA Fees
	  	$3,000
		
	 Underwriter’s Counsel Fees and Expenses
	  	$78,000
		
	 Bond Counsel Fees and Expenses
	  	$100,000
		
	 Lender’s Counsel
	  	$15,000
		
		  	$221,000EX-10.1

 Exhibit 10.1 

CLERK COPY 
 Execution Version

 SETTLEMENT AGREEMENT FOR STIPULATED CONDEMNATION 

BY AND AMONG 

GLOBAL WATER RESOURCES, INC., 

GLOBAL WATER, LLC, 

WEST MARICOPA COMBINE, INC., 

VALENCIA WATER COMPANY, INC., 

WATER UTILITY OF GREATER BUCKEYE, INC., 

AND 
 CITY OF
BUCKEYE 
 DATED MARCH 19, 2015 

 CLERK COPY 

Execution Version 
 LIST
OF EXHIBITS AND SCHEDULES 
 TO 

SETTLEMENT AGREEMENT FOR STIPULATED CONDEMNATION 
  

			
	Exhibit A:	  	Stipulated Final Judgment of Condemnation
		
	Exhibit B:	  	Partial Satisfaction of Judgment
		
	Exhibit C:	  	Stipulated Final Order of Condemnation
		
	Exhibit D:	  	Transition Services Agreement
		
	Exhibit E:	  	Assignment and Assumption Agreement
		
	Exhibit F:	  	Territory

  

			
	Schedules:	 	
	2.1(a)	 	Personal Property
	2.1(b)	 	Assigned Contracts
	2.1(c)	 	Line Extension Agreements
	2.1(e)	 	Real Property
	2.1(f)	 	Construction Work in Progress
	2.1(g)	 	Permits
	2.1(h)	 	Water Rights
	2.6	 	Excluded Assets
	2.7	 	Assumed Liabilities
	3.1.3	 	Required Consents
	3.1.7	 	Undisclosed Liability
	3.1.8	 	Changes in Business
	3.1.9	 	Taxes
	3.1.10	 	Litigation
	3.1.12	 	Exceptions to Marketable Assets
	3.1.15	 	Contracts
	3.1.17	 	Environmental Matters
	4.1.1	 	Employees
	4.3.7	 	Non-Owned Assets

  
 i 

 CLERK COPY 

Execution Version 

SETTLEMENT AGREEMENT FOR STIPULATED CONDEMNATION 

This Settlement Agreement for Stipulated Condemnation (“Agreement”) is dated March 19, 2015, and is by
and among GLOBAL WATER RESOURCES, INC. (“Global Water”), a Delaware corporation, GLOBAL WATER, LLC (“Global LLC”), a Delaware limited liability company, WEST MARICOPA COMBINE, INC. (“WMC”), an
Arizona corporation, VALENCIA WATER COMPANY, INC. (“Valencia”), an Arizona corporation, WATER UTILITY OF GREATER BUCKEYE, INC. (“WUGB”), an Arizona corporation (WUGB and Valencia shall be referred to as the
“Condemnation Defendants” or the “Companies”), and the CITY OF BUCKEYE (“City”), an Arizona municipal corporation. 

RECITALS 

Global Water, Global LLC and WMC are collectively “Global.” Global Water, Global LLC, WMC, Valencia and
WUGB are collectively the “Global Group.” Global Water, Global LLC, WMC, Valencia, WUGB and City are collectively the “Parties” and individually a “Party.” 

Companies are the legal and beneficial owners of the Assets and operate a water utility service that is regulated by the
ACC. 
 Valencia holds CC&Ns (both its original CC&N and the CC&N transferred to it by WUGB) authorizing
Companies to engage as public service corporations in the sale of water for commercial and domestic uses in the geographic area covered by such CC&Ns. 

City desires to acquire the Assets to enhance its water utility system in order to provide its residents with greater
consistency in rates, water quality, water resources management, and other policies and practices relating to the provision of water utility services to its residents. 

City is authorized by the laws of the State of Arizona to construct, purchase, acquire or lease any plant or property or
portion thereof devoted to the business or services rendered by a public water utility, either within or without the City limits, as set forth in the ARS Section 9-511. 

City has approved and adopted resolutions of public use necessity with respect to the Assets in accordance with this
Agreement and of entering into this Agreement. 
 City intends to file a condemnation complaint against Companies seeking
to acquire the Assets and to be titled City of Buckeye v. Valencia Water Company, Inc. et al., in the Maricopa County Superior Court (the “Condemnation Action”). 

City and Companies desire to stipulate to the condemnation of the Assets and to resolve all issues in the Condemnation
Action in a mutually agreeable manner. 
 The Parties intend that the obligations of the Parties under this Agreement will
survive the entry of the stipulated Final Judgment, the stipulated Partial Satisfaction of Judgment and the stipulated Final Order referenced herein and attached as Exhibits A, B and C, including each Party’s obligation to make the closing
deliveries provided in this Agreement, the City’s 

 CLERK COPY 

Execution Version 
  

 
obligation to pay the Growth Premium, each Party’s indemnification obligations and certain portions of Section 11.15 as referenced herein. 

Pursuant to this Agreement, the Final Judgment and the Final Order, Companies are willing to permit the Assets to be
condemned by City and City will condemn and acquire the Assets, all on the terms and subject to the conditions set forth in this Agreement. 

In consideration of the mutual promises, covenants, representations, warranties and obligations herein contained, and on the
terms and subject to the conditions herein set forth, the Parties agree as provided in this Agreement. 
 ARTICLE 1 

DEFINITIONS 

In addition to terms defined elsewhere in this Agreement (including, without limitation, in Section 2.17.3) the terms
defined in this Article 1, whenever used in this Agreement (including the Schedules), shall have the respective meanings given to them below. All references herein to a Section, Article or Schedule are to a section, article, or Schedule of this
Agreement, unless otherwise indicated. 
 AAC means Arizona Administrative Code. 

ACC means the Arizona Corporation Commission. 

Advances in Aid of Construction means funds paid or advanced to Companies by third parties, which may be refundable,
as meter advances or service connection tariffs or pursuant to Line Extension Agreements at and as of the Closing Date. 

Affiliate of a Person means a Person that directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, the first Person. “Control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through the ownership of voting securities, by contract or credit arrangement, as trustee or executor, or otherwise. 

Agreement means this Agreement, including the Schedules. 

Applicable Law means, with respect to any Person, any federal or state constitution, treaty, statute, law (including
common law), rule, regulation, ordinance, code, Governmental Approval, or any order, decision, injunction, judgment, award, decree or agreement of, by or with any Governmental Authority, in any such case to the extent applicable to such Person or
any of its Affiliates or any of their respective assets and businesses as of the date hereof. 
 ARS means the
Arizona Revised Statutes, as in effect on the Closing Date. 
 Assets are defined in Section 2.1. 

Assigned Contracts is defined in Section 2.1(b). 

  
 2 

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Execution Version 
  

 Assumed Liabilities is defined in Section 2.7. 

Best of Knowledge means, as to any member of the Global Group, the knowledge after due investigation and inquiry of
each of Ron L. Fleming, Mike Liebman, and Jon Corwin; as to the City, the knowledge after due investigation and inquiry of Stephen Cleveland and David Nigh; and as to any other Person the knowledge of such Person and the directors, officers,
managers, general partners, trustees and similar agents or representatives of such Person after due investigation and inquiry. 

Business means all of the business and operations of Companies as currently conducted, including operating a water
utility system and acting as public service corporations in the sale of water for commercial and domestic uses in the Service Area. 

Business Day(s) means each day other than a Friday, Saturday, Sunday or any day on which banks in Phoenix, Arizona
are required or permitted to be closed. 
 Certificated Areas means the areas in which Companies, as of the date
hereof, are permitted to provide utility service under the CC&Ns. 
 CC&Ns means all of the Certificates of
Convenience and Necessity granted or recognized by the ACC to Companies to engage as a public service corporation in the sale of water for domestic, commercial and other uses in their Certificated Areas. 

City is defined in the first paragraph of this Agreement.  

City Indemnitees is defined in Section 9.1.  

Closing is defined in Section 2.12. 

Closing Date is defined in Section 2.12. 

Closing Payment is defined in Section 2.13. 

Closing Working Capital means the amount determined as of the Closing Date as follows: Customer Accounts (net of
Customer prepayments); plus capital expenditures incurred by Condemnation Defendants after December 31, 2014, and prior to the Closing Date; minus accounts payable assumed by City at the Closing Date (net of prepaid expenses); minus the current
liabilities set forth on Schedule 2.7, and minus Customer Deposits. 
 Closing Working Capital Statement is
defined in Section 2.16.2(a). 
 Code means the Internal Revenue Code of 1986, as amended.  

Companies is defined in the Recitals.  

Condemnation Action is defined in the Recitals. 

Condemnation Defendants’ Materials is defined in Section 7.2. 

  
 3 

 CLERK COPY 

Execution Version 
  

 Condemnation Price is defined in Section 2.13. 

Confidentiality Agreement is defined in Section 4.9. 

Consent means any consent, approval, authorization, waiver, permit, grant, franchise, concession, agreement, license,
exemption or order of, registration, certificate declaration or filing with, or report or notice to, any Person, including but not limited to any Governmental Authority. 

Contract(s) is defined in Section 3.1.15(a).  

Control is defined in the definition of Affiliate.  

Customers is defined in Section 2.1(d).  

Customer Accounts is defined in Section 2.1(i). 

Customer Deposits means all of Companies’ security deposits, meter deposits, and other deposits from Customers,
but shall not include any payment pursuant to a Line Extension Agreement. 
 Dispute is defined in
Section 10.1. 
 Disputed Amounts is defined in Section 2.16.3(c). 

Employees is defined in Section 4.1.1. 

Environmental Laws means any law, statute, ordinance, rule, regulation or legal requirement in effect at the
Effective Date or the Closing Date pertaining to (a) the protection of health, safety or the environment; (b) the conservation, management, protection or use of natural resources and wildlife; (c) the protection or use of surface
water, groundwater, stored, reclaimed or recovered water, or CAP subcontracts or excess CAP water contracts; (d) the management, manufacture, possession, presence, use, generation, transportation, treatment, storage, disposal, release,
threatened release, abatement, removal, remediation or handling of, or exposure to, any Hazardous Material; or (e) pollution (including any release to air, land, surface water and groundwater), and includes, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986 and the Small Business Liability Relief and Brownfields Revitalization Act, 42 USC 9601, et seq.,
Solid Waste Disposal Act, as amended by the Resource Conservation Act of 1976 and Hazardous and Solid Waste Amendments of 1984, 42 USC 6901, et seq., Federal Water Pollution Control Act, as amended by the Clean Water Act of 1977, 33 USC
1251, et seq., Toxic Substances Control Act of 1976, 15 USC 2601, et seq., Hazardous Materials Transportation Act, 49 USC 651, et seq., Oil Pollution Act of 1990, 33 USC 2701, et seq., Emergency Planning and Community
Right-to-Know Act of 1986, 42 USC App. 11001, et seq., National Environmental Policy Act of 1969, 42 USC 4321, et seq., Safe Drinking Water Act of 1974, as amended by 42 USC 300(f), et seq., and any similar, implementing or
successor law. 

  
 4 

 CLERK COPY 

Execution Version 
  

 Escrow is defined in Section 5.1. 

Escrow Agent means First American Title Company. 

Estimated Closing Working Capital is defined in Section 2.16.1. 

Excluded Assets is defined in Section 2.6.  

Excluded Records is defined in Section 2.6(d).  

Final Judgment is defined in Section 2.2.  

Final Order is defined in Section 2.4. 

Financing is defined in Section 6.2.3. 

GAAP means generally accepted accounting principles in effect in the United States of America as determined by the
Financial Accounting Standards Board from time to time applied on a consistent basis as of the date of any application thereof. 

Global is defined in the Recitals.  

Global Group is defined in the Recitals.  

Global Indemnities is defined in Section 9.2. 

Governmental Approval means any Consent of, with, or from any Governmental Authority. 

Governmental Authority means any: (a) nation, state, county, city, town, village, district, or other
jurisdiction of any nature; (b) federal, state, local, municipal, foreign, or other government; (c) governmental or quasi-governmental authority of any nature (including the ACC and any governmental agency, branch, department, official, or
entity) and any court or other tribunal; (d) multi-national organization or body; or (e) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of
any nature. 
 Growth Period means the twenty (20) year period beginning on January 1, 2015, and ending
on December 31, 2034, and in no event will the Growth Period be suspended or extended. 
 Growth Premium is
defined in Section 2.17. 
 Hazardous Materials means any material, substance, chemical, waste, product,
derivative, compound, mixture, solid, liquid, mineral or gas, in each case, that is hazardous, acutely hazardous, toxic, or words of similar import or regulatory effect under Environmental Laws. 

Improvements is defined in Section 2.1(a). 

  
 5 

 CLERK COPY 

Execution Version 
  

 Indemnified Party is defined in Section 9.3. 

Indemnifying Party is defined in Section 9.3. 

Independent Accountants is defined in Section 2.16.3(c). 

Infrastructure is defined in Section 2.1 (d). 

Knowledge means (a) as to any member of the Global Group, the actual knowledge without any investigation or
inquiry (other than in the compilation of the Schedules to this Agreement), of each of Ron L. Fleming, Mike Liebman, and Jon Corwin, (b) as to the City, the actual knowledge without any investigation or inquiry of Stephen Cleveland and David
Nigh, and (c) as to any other Person the actual knowledge without any investigation or inquiry of such Person and the agents or representatives of such Person. 

Leased Real Property means all real property leased by Companies as lessee or tenant and is used or usable by
Companies in the conduct of the Business. 
 Lien means any mortgage, deed of trust, claim, charge, lien,
encumbrance, security interest, pledge, hypothecation, adverse interest, burden, judgment, encroachment, lease, sublease, license, occupancy agreement, easement, covenant, title defect, title retention agreement, and any other restriction or
limitation of any nature whatsoever, including but not limited to any of the foregoing arising under any of the Contracts or imposed against any Owned Real Property or any of the other Assets. 

Line Extension Agreement means a line extension agreement, main extension agreement, collection main extension
agreement, plant expansion agreement, water service agreement, or any similar or other agreement under which either one of the Companies is a party in its capacity as a water utility service provider and that is subject to AAC R14-2-406, AAC
R14-2-606, or other Applicable Law or that provides for an Advance in Aid of Construction. 
 Losses is defined in
Sections 9.1. 
 New Account means a new water meter that is installed and connected and is billing and available
for water service during the Growth Period in the Territory, regardless of the number of units represented by the new water meter, but does not include an inactive account that becomes active or a meter that is replaced (e.g., replaces a broken
meter or is a new model replacing an old model). 
 Non-Owned Assets is defined in Section 4.3.7. 

Owned Real Property means all real property interests, whether owned in fee, an easement or otherwise, where the real
property is owned by Companies and used in the conduct of the Business. 
 Parties is defined in the Recitals. 

Party is defined in the Recitals. 

  
 6 

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 Permits is defined in Section 2.1(g). 

Person means any natural person, firm, partnership, association, corporation, company, limited liability company,
general or limited partnership, trust, business trust, Governmental Authority, or other entity. 
 Personal Property
is defined in Section 2.1(a) 
 Post-Closing Adjustment is defined in Section 2.16.2(b).  

Real Property is defined in Section 2.1(e).  

Restricted Contracts is defined in Section 2.10.  

Restrictive Period is defined in Section 8.1. 

Retained Liabilities is defined in Section 2.8. 

Reports is defined in Section 5.1.5. 

Resolution Period is defined in Section 2.16.3(b).  

Review Period is defined in Section 2.16.3(a).  

Schedule Supplement is defined in Section 4.11. 

Schedules means each of the schedules and exhibits referred to in and attached to this Agreement, all of which are
hereby made a part of this Agreement. 
 Service Area means the geographic areas in which Companies are lawfully
entitled to provide public utility water services pursuant to ARS Title 45. 
 Statement of Objections is defined
in Section 2.16.3(b). 
 Stipulation of Dismissal with Prejudice is defined in Section 7.2. 

Tax or Taxes means any federal, state, provincial, local, foreign or other income, alternative, minimum, accumulated
earnings, personal holding company, franchise, capital stock, net worth, capital, profits, windfall profits, gross receipts, value added, privilege, sales, use, goods and services, excise, customs duties, transfer, conveyance, mortgage,
registration, stamp, documentary, recording, premium, severance, environmental (including taxes under Section 59A of the Code), real property, personal employment, unemployment insurance, social security, disability, workers’ compensation,
payroll, health care, registration, withholding, estimated or (including all interest and penalties thereon and additions thereto whether disputed or not). 

Tax Return means any return, report, declaration, form, claim for refund, information return or statement relating to
Taxes, including forms, schedules and attachments thereto, and including amendments thereof. 

  
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 Territory means the Certificated Areas other than the portions
thereof described in the attached Exhibit F. 
 Transferred Employee is defined in Section 4.1.1. 

 Undisputed Amounts is defined in Section 2.16.3(c).  

Valencia is defined in the first paragraph of this Agreement. 

Warranties means all manufacturers’ and vendors’ warranties benefiting Companies with respect to any of the
Assets. 
 WUGB is defined in the first paragraph to this Agreement. 

ARTICLE 2 

CONDEMNATION OF ASSETS; CLOSING 

2.1        Condemnation of Assets. Subject to the terms and conditions of
this Agreement and the Final Judgment, on the Closing Date, City shall condemn from Companies, all of Companies’ right, title and interest in and to all of the properties and assets, whether real, personal or mixed, tangible or intangible, of
every kind and description, wherever located, related to, necessary for, and used or usable in, the Business, including, without limitation, the properties and assets set forth below as of the Closing Date (collectively, the
“Assets”) as well as the CC&Ns for the Certificated Areas, but specifically excluding from the Assets only the Excluded Assets: 

(a)        all power generation equipment, pumping equipment, water treatment
equipment, laboratory equipment, power operated equipment, communication towers and equipment, radio read equipment, computers, miscellaneous equipment, surplus equipment, parts, machinery, tools, shop and garage equipment, transportation equipment,
vehicles, trailers, furniture, fixtures, leasehold improvements, inventory, chemicals, supplies, and other personal property owned by Companies, including without limitation those set forth on the attached Schedule 2.1(a) (collectively, the
“Personal Property”) and all of Companies’ interests in all improvements to the Real Property (collectively, the “Improvements”), including without limitation those set forth on the attached Schedule
2.1(a); 
 (b)        all of Companies’ interests in each of the
contracts and agreements between Companies and (i) all Customers, (ii) equipment lessors under only the leases set forth on the attached Schedule 2.1(b) and no others, and (iii) vendors and suppliers (other than
professionals, such as consultants, engineers, accountants, and attorneys who are not Employees) under only the contracts that are set forth on the attached Schedule 2.1(b) and no others (collectively the “Assigned
Contracts”); 
 (c)        all of Companies’ interests in all Line
Extension Agreements with developers, builders and others, including without limitation those set forth on the attached Schedule 2.1(c); 

  
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 (d)        all of Companies’
interests in all facilities, plants, structures, storage tanks, pumps, wells, booster pumps, water and supply mains, service lines, pipelines, waterlines, meters and meter installations, fire hydrants, distribution reservoirs and standpipes,
transmission and distribution mains, back flow prevention devices, associated equipment, and other improvements comprising the utility water systems and infrastructure, whether owned or leased, used in the Business (the
“Infrastructure”) in connection with Companies’ provision of water utility service to residential, commercial and other customers residing or located within the Certificated Areas (collectively, “Customers”);

 (e)        all of Companies’ interests, whether as owner or lessee, in
all Infrastructure, Improvements and other real property (collectively the “Real Property”), including without limitation those identified or described on the attached Schedule 2.1(e) and including all utility casements, all
tenements, hereditaments and appurtenances pertaining to the Real Property, all sewer, mineral, water and irrigation rights running with or otherwise appurtenant or pertaining to the Real Property, and all of Companies’ interests in any road
adjoining the Real Property to the center line thereof, and any road franchise agreements with any Governmental Authority; 

(f)         all of Companies’ construction in progress, whether performed
pursuant to a Line Extension Agreement or otherwise, including the construction in progress set forth on the attached Schedule 2.1(f); 

(g)        all of Companies’ interests in all permits, licenses, franchises,
consents, rights, authorizations and approvals issued by, and all registrations and filings with, any Governmental Authority in connection with the Assets or the Business (collectively the “Permits”), including without limitation those set
forth on the attached Schedule 2.1(g); 
 (h)        all of
Companies’ (i) surface water rights, (ii) groundwater rights (including, without limitation, Type I and Type II groundwater rights), (iii) stored, reclaimed and recovered water, (iv) ground water permits and water storage
and well permits, (v) CAP subcontracts and excess CAP water contracts (including, without limitation, all of the same set forth on the attached Schedule 2.1(h)); 

(i)        all of Companies’ accounts receivable arising from the conduct of
the Business on or prior to the Closing Date, whether or not an invoice has been submitted by Condemnation Defendants, which are included in the calculation of Closing Working Capital (collectively “Customer Accounts”); 

(j)        all of Companies’ interests as owner or licensee in any software
licenses, software or data, including radio licenses or communications franchises or licenses, identified by City in writing to be included in and as part of the Assets (other than the license to use FATHOM); 

(k)        all of Companies’ Warranties; 

(1)        all books, records and files pertaining to Assigned Contracts, Assumed
Liabilities, Customers, Customer Accounts, Customer Deposits, Advances in Aid of Construction, Line Extension Agreements, Infrastructure, Real Property, Improvements, GIS 

  
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 maps, maintenance records, and otherwise relating to the Assets or the Business, excepting
only the Excluded Books and Records; and 
 (m)        all of goodwill and the
value as a going concern of Companies. 
 2.2        Final Judgment. The
Parties agree to the entry of the Stipulated Final Judgment of Condemnation (the “Final Judgment”) in the form attached as Exhibit A, which incorporates this Agreement including the Schedules. 

2.3        Satisfaction of Judgment. After the entry of the Final Judgment,
the Parties shall file a stipulated form of Partial Satisfaction of Judgment in the form attached as Exhibit B. 

2.4        Final Order. After the Parties file the Partial Satisfaction of
Judgment, the Parties agree to submit to the court a Stipulated Final Order of Condemnation (the “Final Order”) in the form attached as Exhibit C. Once the Final Order is entered by the court, City agrees (i) not to
record the Final Order with the Maricopa County Recorder and (ii) to deliver the Final Order in a recordable form to the Escrow Agent to be recorded by the Escrow Agent on the Closing Date in accordance with Section 5.1.4. The Parties
(a) agree that they will not challenge the Final Judgment or Final Order entered by the Maricopa County Superior Court; (b) hereby waive any procedural right to do so under any applicable legal or equitable doctrine; and (c) hereby
waive their rights to appeal the Final Judgment and the Final Order; provided, in each case, that the Final Judgment and Final Order are approved by the court in substantially the forms set forth on Exhibits A and C. 

2.5        Waiver. Upon the execution of this Agreement, the provisions of
this Agreement shall constitute the waiver of the requirements under ARS Sections 12-1116(A) through (D) as to the Condemnation Action. The Parties further agree and acknowledge that, upon entry of the Final Judgment, this Agreement shall not merge
into the Final Judgment. 
 2.6        Excluded Assets. The Parties
acknowledge and agree that Companies are not conveying, transferring, assigning or delivering to City, and City is not condemning or acquiring, only the properties and assets set forth below (collectively the “Excluded Assets”):

 (a)        Companies’ cash and cash equivalents; 

(b)        Companies’ marketable securities; 

(c)        Companies’ contract or license to use FATHOM; 

(d)        Companies’ stock records and ledgers and minute books, general
books of account and books of original entry that comprise their permanent accounting or tax records, books and records for medical, dental, disability and workers compensation plans, financial statements, and Tax Returns (collectively the
“Excluded Records”); 
 (e)        Companies’ receivables
due from Affiliates of Companies; 
 (f)        all files, emails, memoranda,
letters and other communications, work product, engagement letters, and the attorney-client privilege and the right to waive or assert 

  
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attorney-client privilege related to the engagement by any member of the Global Group of any law firm; and 

(g)        the assets specifically listed on the attached Schedule 2.6. 

2.7        Assumed Liabilities. Subject to the terms and conditions of this
Agreement and the Final Judgment, on the Closing, City will assume and agrees to pay, perform and otherwise discharge only the following (collectively the “Assumed Liabilities”) and no other claims, obligations or liabilities of any
kind or nature: 
 (a)        the covenants and obligations of Companies accruing
or arising after the Closing Date under the Assigned Contracts (but not for breaches or defaults of covenants or obligations thereunder on or before the Closing Date); 

(b)        accounts payable that are included in the calculation of Closing Working
Capital; 
 (c)        Customer Deposits included in the calculation of Closing
Working Capital; 
 (d)        the Line Extension Agreements; and 

(e)        the specific liabilities of Companies set forth on the attached
Schedule 2. 7. 
 2.8        Retained Liabilities. The Parties
acknowledge and agree that the Global Group shall, after the Closing, pay, perform and discharge each of the following (collectively the “Retained Liabilities”): 

(a)        all obligations and liabilities in connection with the Excluded Assets;

 (b)        all obligations and liabilities of Companies for Taxes; 

(c)        all obligations and liabilities of Companies relating to or arising
under any qualified retirement plan, non-qualified retirement or similar plan, or welfare benefit plan; 

(d)        any claim, obligations and liabilities relating to Liens on any of the
Assets; 
 (e)        all breaches or defaults of covenants or obligations under
any of the Assigned Contracts on or before the Closing Date; 
 (f)        all
accounts payable that are not included in the calculation of Closing Working Capital or that were incurred in the ordinary course of business by the Companies that are either past due or delinquent as of the Closing Date; 

(g)        all obligations under Sections 2.9.1 and 2.9.2 below relating to Line
Extension Agreements; and 
 (g)        all claims, obligations and liabilities
of every kind and nature whatsoever of Companies that are not specifically an Assumed Liability. 

  
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 2.9        Line Extension Agreements. 

2.9.1    Companies’ Responsibility. Companies shall defend and indemnify City and hold City
harmless for, from and against each of the following: (i) any and all breaches and defaults and claimed breaches and defaults under the Line Extension Agreements that arose, occurred or accrued on or before the Closing Date; and (ii) all
refunds of Advances in Aid of Construction that were due and owing under any Line Extension Agreement on or before the Closing Date. The obligation of Companies under this Section 2.9.1 is part of the Retained Liabilities. 

2.9.2    Reimbursement. In addition, if City pays any refund of Advances in Aid of Construction
under a Line Extension Agreement and if any portion of such refund is the responsibility or obligation of Companies, Companies shall reimburse City for Companies’ portion of each such refund within thirty (30) days after the date of
City’s written notice to Companies setting forth the amount to be reimbursed and the calculation thereof. City and Companies shall cooperate in resolving any dispute over the amount of the respective obligations of City and Companies for any
such refund paid by City. 
 2.10        Nonassignable Contracts. If there
are any Consents that are required to be obtained in connection with the assignment and assumption of any Contract hereunder that have not yet been obtained (or which Consent otherwise is not in full force and effect) as of the Closing, in the case
of each Contract as to which such Consents were not obtained (or which Consent otherwise is not in full force and effect) (the “Restricted Contracts”), City may in its sole and absolute discretion waive the closing condition as to
any such Consent and either: 
 (a)        elect to have the Companies continue
their efforts to obtain the Consent; or 
 (b)        elect to accept the
assignment of and assume the Restricted Contract and all liabilities arising therefrom or relating thereto, in which case, as between City and the Companies, such Restricted Contract shall, to the maximum extent practicable and notwithstanding the
failure to obtain the applicable Consent, be transferred at the Closing. 
 If City elects to have Companies continue their efforts to
obtain any Consents with respect to a Restricted Contract and the Closing occurs, neither this Agreement nor the Assignment and Assumption Agreement nor any other document related to this Agreement shall constitute a sale, assignment, assumption,
transfer, conveyance or delivery or an attempted sale, assignment, assumption, transfer, conveyance or delivery of the Restricted Contract, and following the Closing, the Parties shall cooperate with each other, to obtain the Consent relating to the
Restricted Contract as quickly as practicable. Pending the obtaining of such Consent relating to any Restricted Contract, the Parties shall cooperate with each other in any reasonable and lawful arrangements designed to provide to City the benefits
and burdens of use of the Restricted Contract for its term (or any right or benefit or burden arising thereunder, including the enforcement for the benefit of City of any and all rights and obligations of Companies with respect to a third party
thereunder) without breaching the Restricted Contract. Once all Consents for the sale, assignment, assumption, transfer, conveyance and delivery of a Restricted Contract are obtained, Companies shall promptly assign, transfer, convey and deliver
such Restricted 

  
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 Contract to City, and City shall assume the obligations under such Restricted Contract
assigned to City from and after the date of assignment to City pursuant to a special-purpose assignment and assumption agreement substantially similar in terms to those of the Assignment and Assumption Agreement (which special-purpose agreement the
Parties shall prepare, execute and deliver in good faith at the time of such transfer, all at no additional cost to City). If City elects to have Companies continue its efforts to obtain any Consents with respect to a Restricted Contract, the
Companies will continue to use commercially reasonable efforts to obtain those Consents. 

2.11    Risk of Loss. The risk of loss, damage to, or the forfeiture or revocation of, the Assets
or any part of the Assets on or before the consummation of the Closing shall be borne by Companies. In the event of any loss or damage prior to the Closing of all or a material part of the Assets, City shall have the option to terminate this
Agreement, in City’s sole discretion, in which case City shall not be entitled to any award relating to any loss, damage, forfeiture or revocation arising before the Closing. In the alternative, City may negotiate for an adjustment to the
Condemnation Price; however, if Companies and City cannot agree upon an adjustment within a reasonable period (not to exceed ten (10) days after the date City receives notice of the material loss, damage, forfeiture or revocation), but in no event
later than the Closing Date, City may, in City’s sole discretion, terminate this Agreement as provided above. In any event, if City waives any such loss, damage, forfeiture or revocation of Assets and proceeds to consummate this transaction,
the Global Group shall, at the Closing, deliver and assign to City as of the Closing all rights and claims to insurance or other proceeds that have been received and will be received by Companies in connection therewith, such insurance or other
proceeds not to exceed the amount of the Condemnation Price. 
 2.12    Place and Date of Closing;
Possession. The consummation and closing under this Agreement and of the transactions contemplated herein (the “Closing”) will take place at 10:00 a.m. Phoenix, Arizona time within two (2) Business Days after the closing
and full funding of the Financing, or at such other date as is agreed upon by the Parties and otherwise as is directed by the court in the Final Judgment (the “Closing Date”), at the offices of Gust Rosenfeld P.L.C., One East
Washington, Suite 1600, Phoenix, Arizona 85004, or at such other place as the Parties may agree. The Closing shall be deemed effective as of 11:59 p.m. Phoenix, Arizona time on the Closing Date. 

2.13    Condemnation Price. In addition to the assumption of the Assumed Liabilities by City, the
consideration for the condemnation of the Assets (the “Condemnation Price”) shall be the sum of (a) fifty-five million dollars ($55,000,000), subject to adjustment pursuant to Sections 2.16, payable in readily available funds
by wire transfer on the Closing Date (the “Closing Payment”) plus (b) the Growth Premium, but in no event shall the Growth Premium exceed forty-five million dollars ($45,000,000), payable in accordance with Section 2.17.

 2.14    Allocation of Condemnation Price. The Condemnation Price, the Assumed Liabilities
and other items included in “consideration” for purposes of Code Section 1060 shall be allocated in the Condemnation Defendants’ discretion among the Assets in accordance with Code Section 1060 and the Treasury Regulations
thereunder. 

  
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 2.15    Tax Certificates. Companies shall file
with the Arizona Department of Revenue as close to the Closing Date as is practicable, a tax clearance application for a certificate of good standing relating to the sale of a business for Companies’ income, transaction privilege, use and
withholding taxes, and Companies shall promptly deliver a true copy of the response to City. 
 2.16    Closing
Payment Adjustment. 
 2.16.1 Closing Adjustment. At least ten (10) Business Days before the Closing,
Condemnation Defendants shall prepare and deliver to City a statement setting forth their good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”). After City’s receipt of the Estimated Closing
Working Capital as calculated by Condemnation Defendants, City shall have five (5) Business Days to review the same, and Condemnation Defendants shall provide City with full access to the books and records of Condemnation Defendants, the
personnel of, and the work papers prepared by or for Condemnation Defendants to the extent they relate to the Estimated Closing Working Capital and to such historical financial information relating thereto that City reasonably requests. City then
may object to the calculation of the Estimated Closing Working Capital and provide to Condemnation Defendants City’s good faith calculation of the Estimated Closing Working Capital, in which case the parties will attempt to agree on the amount
of the Estimated Closing Working Capital and, failing to do so, the average of their respective calculations of such amount shall be the Estimated Closing Working Capital. If the Estimated Closing Working Capital is a positive number, the Closing
Payment shall be increased by the amount of the Estimated Closing Working Capital. If the Estimated Closing Working Capital is a negative number, the Closing Payment shall be reduced by the amount of the Estimated Closing Working Capital. 

2.16.2  Post-Closing Adjustment. 

(a)        Within sixty (60) days after the Closing Date, City shall prepare
and deliver to Condemnation Defendants a statement setting forth its calculation of Closing Working Capital (the “Closing Working Capital Statement”). 

(b)        The post-closing adjustment shall be an amount equal to the Closing
Working Capital minus the Estimated Closing Working Capital (the “Post-Closing Adjustment”). If the Post-Closing Adjustment is a positive number, City shall pay to Condemnation Defendants an amount equal to the Post-Closing
Adjustment pursuant to Section 2.16.3(f). If the Post-Closing Adjustment is a negative number, Condemnation Defendants shall pay to City an amount equal to the Post-Closing Adjustment pursuant to Section 2.16.3(f). 

2.16.3  Examination and Review. 

(a) Examination. After receipt of the Closing Working Capital Statement, Condemnation Defendants shall have thirty
(30) days (the “Review Period”) to review the Closing Working Capital Statement. During the Review Period, Condemnation Defendants and Condemnation Defendants’ accountants shall have full access to the books and records of
City, the personnel of, and work papers prepared by, City and/or City’s accountants to the extent that they relate to the Closing Working Capital Statement and to such historical financial information 

  
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 (to the extent in City’s possession) relating to the Closing Working Capital Statement
as Condemnation Defendants may reasonably request for the purpose of reviewing the Closing Working Capital Statement and to prepare a Statement of Objections (defined below). 

(b)        Objection. On or prior to the last day of the Review Period,
Condemnation Defendants may object to the Closing Working Capital Statement by delivering to City a written statement setting forth Condemnation Defendants’ objections in reasonable detail, indicating each disputed item or amount and the basis
for Condemnation Defendants’ disagreement therewith (the “Statement of Objections”). If Condemnation Defendants fail to deliver the Statement of Objections before the expiration of the Review Period, the Closing Working Capital
Statement and the Post-Closing Adjustment, as the case may be, reflected in the Closing Working Capital Statement shall be deemed to have been accepted by Condemnation Defendants. If Condemnation Defendants deliver the Statement of Objections before
the expiration of the Review Period, City and Condemnation Defendants shall negotiate in good faith to resolve such objections within thirty (30) days after the delivery of the Statement of Objections (the “Resolution Period”),
and, if the same are so resolved within the Resolution Period, the Post-Closing Adjustment and the Closing Working Capital Statement with such changes as may have been previously agreed in writing by City and Condemnation Defendants, shall be final
and binding. 
 (c)        Resolution of Disputes. If Condemnation
Defendants and City fail to reach an agreement with respect to all of the matters set forth in the Statement of Objections before expiration of the Resolution Period, then with respect to any amounts remaining in dispute (“Disputed
Amounts” and any amounts not so disputed, the “Undisputed Amounts”), City and Condemnation Defendants shall appoint by mutual agreement the office of an impartial nationally or regionally recognized firm of independent
certified public accountants other than Condemnation Defendants’ accountants or City’s accountants (the “Independent Accountants”) who, acting as experts and not arbitrators, shall resolve the Disputed Amounts only and
make any adjustments to the Post-Closing Adjustment, as the case may be, and the Closing Working Capital Statement. The Parties hereto agree that all adjustments shall be made without regard to materiality. The Independent Accountants shall only
decide the specific items under dispute by the Parties and their decision for each Disputed Amount must be within the range of values assigned to each such item in the Closing Working Capital Statement and the Statement of Objections, respectively.

 (d)        Fees of the Independent Accountants. Condemnation Defendants
shall pay a portion of the fees and expenses of the Independent Accountants equal to 100% multiplied by a fraction, the numerator of which is the amount of Disputed Amounts submitted to the Independent Accountants that are resolved in favor of City
(that being the difference between the Independent Accountants’ determination and Condemnation Defendants’ determination) and the denominator of which is the total amount of Disputed Amounts submitted to the Independent Accountants (that
being the sum total by which City’s determination and Condemnation Defendants’ determination differ from the determination of the Independent Accountants). City shall pay that portion of the fees and expenses of the Independent Accountants
that Condemnation Defendants are not required to pay hereunder. 

  
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 (e)        Determination by
Independent Accountants. The Independent Accountants shall make a determination as soon as practicable within thirty (30) days (or such other time as the Parties hereto shall agree in writing) after their engagement, and their resolution of
the Disputed Amounts and their adjustments to the Closing Working Capital Statement and/or the Post-Closing Adjustment shall be conclusive and binding upon the Parties hereto. 

(f)        Payments of Post-Closing Adjustment. Except as otherwise provided
herein, any payment of the Post-Closing Adjustment shall (A) be due (x) within five (5) Business Days of acceptance of the applicable Closing Working Capital Statement or (y) if there are Disputed Amounts, then within five
(5) Business Days of the resolution described above; and (B) be paid by wire transfer of immediately available funds to such account as is directed by City or Condemnation Defendants, as the case may be. 

2.16.4  Adjustments for Tax Purposes. Any payments made pursuant to Section 2.14 shall be treated as
an adjustment to the Condemnation Price by the Parties for Tax purposes, unless otherwise required by Law. 
 2.17
    Growth Premium. 
 2.17.1  Aggregate Amount. City shall pay to Condemnation
Defendants an amount equal to the product of (a) three thousand dollars ($3,000) multiplied by (b) the number of New Accounts during the Growth Period up to a maximum of forty-five million dollars ($45,000,000) (the “Growth
Premium”), payable in the manner provided in this Section 2.17. In no event will the Growth Premium exceed forty-five million dollars ($45,000,000) in the aggregate. 

2.17.2 Quarterly Payments. On or before 45th day after the end of the calendar quarter following the Closing Date
and each calendar quarter thereafter, and continuing until the 45th day after the expiration of the Growth Period, City shall provide to Condemnation Defendants a list of New Accounts during the preceding calendar quarter (or other applicable
period) and shall pay to Condemnation Defendants an amount equal to the product of (a) three thousand dollars ($3,000) multiplied by (b) the number of New Accounts during such calendar quarter (or other applicable period), until the total
payments pursuant to this Section 2.17.2 are equal to the total Growth Premium or the Growth Period expires, whichever first occurs. The first list and payment shall cover the period from January 1, 2015 through and including the end of
the calendar quarter in which falls the Closing Date. Condemnation Defendants may, not more than once in any calendar year, and upon five (5) Business Days’ prior written notice, inspect the relevant books and records of City to confirm
the accuracy of any list or lists of New Accounts and the Growth Premium payment calculations. Condemnation Defendants’ costs of such inspection shall be borne by Condemnation Defendants unless the results of the inspection determine that the
prior Growth Premium payments by City are fifteen thousand dollars ($15,000) or more below the amount of the Growth Premium payments that should have been paid to Condemnation Defendants over the course of the four calendar quarters immediately
preceding the inspection, in which case the costs of the inspection shall be paid by City. In the event the audit reveals any underpayment by City, City shall pay Condemnation Defendants, as soon as reasonably practicable, any and all unpaid amounts
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 the results of any such inspection, the Parties will use reasonable efforts to negotiate a
prompt resolution to such dispute. City shall not delegate its obligations to make Growth Premium payments under this Section 2.17. Condemnation Defendants’ rights to receive their requisite Growth Premium payments under this
Section 2.17 shall survive the Closing. 
 2.17.3  Security for Growth Premium. 

(a)        Definitions. For purposes of this Section 2.17.3, the
following terms shall have the respective meanings given to them below. 
 Bond means all outstanding Senior
Bonds, WIF A Loan Agreements and outstanding Subordinate Obligations issued or incurred by City. 
 Net Revenues
means that portion of the Revenues of the System remaining after deducting all funds for the Operation and Maintenance Expenses of the System. Net Revenues shall not include development fees imposed by City pursuant to Arizona Revised Statutes,
Title 9, Chapter 4, Article 6.2 or any other fee imposed on a New Account for water service. 
 Operation and
Maintenance Expenses means all costs and expenses incurred in connection with the operation, use and maintenance of the System, including, without limitation, all (i) repairs, additions and improvements to keep the System in an efficient
and economical operating condition, (ii) payments of premiums for insurance carried on the System, (iii) payments of reasonable administrative expenses of City relating to the System, and (iv) generally all expenses of the System
except depreciation and debt service payments related to any Bond. 
 Revenues means all income, moneys and
receipts received by City, directly or indirectly, from the ownership, use or operation of the System including any waste material or by-products of the System, and also including investment income, but shall not include development fees imposed by
City pursuant to Arizona Revised Statutes, Title 9, Chapter 4, Article 6.2 or any other fee imposed on a developer, builder or customer for a new water meter for water service however designated. 

Senior Bonds means Senior Bonds (as defined in City’s Resolution No. 09-15) issued or incurred pursuant to
Resolution No. 09-15 and secured as to payment by a first lien on the Net Revenues, but shall not include any WIFA Loan Agreements. 

Subordinate Obligations means any bonds or other obligations issued or incurred by City pursuant to Resolution
No. 09-15 and secured as to payment by a subordinate lien on the Net Revenues which, by the terms of such bond or other obligation are secured by a lien on Net Revenues that is subordinate to the lien on Net Revenues securing the Senior Bonds
and the WIFA Loan Agreements. 
 System means (i) all of the assets, properties and facilities of City’s
water system that lie within the boundaries of City, as now existing or hereafter modified, and (ii) all improvements, additions and extensions thereto and replacements thereof that are constructed or acquired and owned by City by purchase,
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 clauses (i) and (ii), provided the same are used or useful or held for use in the
operation of City’s water system. 
 WIFA Loan Agreements means (i) all existing loan agreements entered
into between City and WIFA, including those dated: November 20, 2009, as amended on December 5, 2014 (Loan #91Al40-10); April 5, 2013, as amended on December 5, 2014 (Loan #920239-13 and Loan #920241-13); and April 5,
2013, as amended on June 20, 2014 and December 5, 2014 (Loan #910158-13); and (ii) all WIFA Loan Agreements between City and WIFA that are entered into after the Closing and that are secured by the Net Revenues. 

(b)        Security. The Growth Premium shall be payable solely from the Net
Revenues that remain after all payments have been paid or set aside for payment of the Bonds and of any other obligations set forth in Resolution No. 09-15 (the “Third Position Net Revenues”). The Third Position Net Revenues
are hereby pledged and assigned as security for the payment of the Growth Premium, subject to the prior liens securing the Bonds. This pledge and assignment of the Third Position Net Revenues made pursuant to this Section 2.17.3(b) shall be and
constitutes a third and subordinate lien on and pledge of the Net Revenues. 

(c)        Additional Source of Funds and Additional Security. In addition
to the pledge and assignment of Third Position Net Revenues as provided above, the Growth Premium shall be payable from City’s receipt of (i) any development impact fee for potable water collected within the Territory after the Closing by
City pursuant to Arizona Revised Statutes, Title 9, Chapter 4, Article 6.2 or (ii) any other fee, including fees under existing or future Line Extension Agreements and Advances in Aid of Construction agreements for potable water, however
designated, collected within the Territory after the Closing by City (collectively, “Growth Premium Impact Fee”). The levy or imposition within the Territory after the Closing by City of any Growth Premium Impact Fee shall be a
decision made by City exercising its sole and absolute discretion. If City levies or imposes a Growth Premium Impact Fee, the Growth Premium Impact Fee Revenues are hereby pledged and assigned as security for the payment of the Growth Premium as a
first lien on the Growth Premium Impact Fee. 
 (d)        Limited
Recourse. Except as provided, in this Sections 2.17.3, the Condemnation Defendants shall have no recourse against City for payment of the Growth Premium, whether against the City’s general revenues or otherwise. 

(e)        Further Assurances. Upon and following the Closing Date, City and
Condemnation Defendants shall execute and deliver such additional assurances that are consistent with City’s Resolution No. 09-15 and with the terms of this Section 2.17.3 and take such other actions consistent with City’s
Resolution No. 09-15 and with the terms of this Agreement as shall be necessary, or reasonably acceptable to City and Condemnation Defendants, to confirm and assure the rights and obligations provided for in this Section 2.17 .3 and render
effective the security for the Growth Premium contemplated hereby. 

  
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 ARTICLE 3 

REPRESENTATIONS AND WARRANTIES 

3.1        Representations and Warranties of Global Group. The Global Group,
jointly and severally, represents and warrants to, and covenants with, City, as and at the date of this Agreement and as and at the Closing Date, as provided in this Section 3.1. 

3.1.1     Corporate Status; Authority. 

(a)        Global. Global Water is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware and has full corporate power and authority (i) to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated
herein and (ii) to carry on its business and to own or lease and to operate its properties and assets as and in the places where such business is conducted and such properties or assets are owned, leased, or operated. Global Water is the sole
member of Global LLC. 
 (b)        Global LLC. Global LLC is a limited
liability duly organized, validly existing, and in good standing under the laws of the State of Delaware and has full power and authority (i) to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the
transactions contemplated herein and (ii) to carry on its business and to own or lease and to operate its properties and assets as and in the places where such business is conducted and such properties or assets are owned, leased, or operated.
Global LLC is the sole shareholder of WMC. 
 (c)        WMC, Valencia and
WUGB. Each of WMC, Valencia and WUGB is a corporation duly organized, validly existing, and in good standing under the laws of the State of Arizona and has full corporate power and authority (i) to execute and deliver this Agreement, to
perform its obligations hereunder, and to consummate the transactions contemplated herein and (ii) to carry on its business and to own or lease and to operate its properties and assets as and in the places where such business is conducted and
such properties or assets are owned, leased, and operated. Each of Valencia and WUGB is wholly owned by WMC. 

(d)        Authority. The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein have been duly authorized by all requisite action by each of the Global Group. Each of Global Group duly executed and delivered this Agreement by its duly authorized officer, manager or member.
This Agreement and all documents and instruments to be delivered by each of the Global Group pursuant to this Agreement constitutes (or will constitute on its execution and delivery) the valid and legally binding obligation of each of them and is
enforceable against each of them in accordance with their terms, subject to bankruptcy, insolvency, reorganization, fraudulent transfer and conveyance, receivership, moratorium, and similar laws affecting creditors’ rights generally, and to the
availability of equitable remedies (whether asserted at law or in equity). 
 3.1.2  No Conflicts or
Violations. The execution, delivery, and performance by each of the Global Group and the consummation of the transactions contemplated herein, do not and will not (a) conflict with or result in a violation or breach of or a default under
(with or 

  
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 without the giving of notice or the lapse of time or both) (i) any Applicable Law
applicable to it or any of its Affiliates or to any of its properties or assets, (ii) its articles of incorporation or organization, bylaws or operating agreement, or other organizational documents, as they may have been amended, or
(iii) subject to obtaining the Consents set forth on the attached Schedule 3.1.3, any Contract to which it is a party or by which it or any of its properties or assets may be bound affected. 

3.1.3     Consents. Except as set forth on the attached Schedule 3.1.3, no Governmental
Approval or other Consent is required to be obtained or made by Global, Valencia or WUGB in connection with its execution, delivery and performance of this Agreement or the consummation of the transactions contemplated herein. 

3.1.4     Compliance with Applicable Law. To the Best of Knowledge the Global Group, each of
Global, Valencia and WUGB is in material compliance with all Applicable Law governing, affecting or relating to its properties and assets, including the Assets, the Line Extension Agreements, the Employees and the affairs and conduct of the
Business, including federal, state and local laws, statutes, ordinances, rules and regulations relating to equal employment opportunities, fair employment practices, occupational health and safety, wages and hours, and discrimination. Without
limiting the generality of the foregoing, to the Knowledge the Global Group, Companies have satisfied all of their obligations to date with respect to the filing of annual reports with the ACC, ADWR, ADEQ and ADHS. 

3.1.5     Account and Revenue Data. All customer account consumption and revenue data for the
Companies for the periods ended on December 31, 2014, 2013, 2012, 2011 and 2010 and the period beginning January 1, 2015, and ending February 28, 2015, which Companies have furnished to City, is true, correct and complete in all
material respects. 
 3.1.6     Financial Statements. Global Water has delivered to City true,
correct and complete copies of the internal financial statements of Companies as at and for the periods ended on December 31, 2014, 2013, 2012, 2011 and 2010 and the internal financial statements of Companies as at and for the period beginning
January 1, 2015, and ending February 28, 2015, (collectively, the “Financial Statements”), including in each case a balance sheet and a statement of income. The Financial Statements are consistent with the internal books
and records of Companies. The annual Financial Statements are audited on a consolidated basis. The Financial Statements have been prepared and maintained on the accrual method of accounting and in accordance with GAAP and the NARUC Uniform Systems
of Accounts for water utilities. The Financial Statements do not omit any material asset or liability of Companies and are consistent with the internal books and records of Companies. 

3.1.7     No Undisclosed Liabilities. Companies have no material liabilities, indebtedness,
guarantees or obligations of any kind or nature, whether known or unknown, absolute, accrued, fixed or contingent, disputed or undisputed, matured or unmatured, liquidated or unliquidated, secured or unsecured, or otherwise and whether due or to
become due except (a) as set forth on the attached Schedule 3.1.7; (b) as and to the extent reflected, disclosed or reserved against in the Financial Statements; (c) liabilities of the type that are not required by GAAP to be
reflected in the Financial Statements; and (d) liabilities incurred since December 31, 2014 in the ordinary course of business consistent with past practice. Without limiting the 

  
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 foregoing, except to the extent specifically disclosed in Schedule 3.1.7 and to the
Best of Knowledge of the Global Group, there are no material: 

(a)        overcharges to Customers; 

(b)        due and unpaid refunds under any Line Extension Agreement; and 

(c)        due and unrefunded Customer Deposits. 

3.1.8    No Changes. Except as set forth on the attached Schedule 3.1.8, since
December 31, 2014, Companies have conducted the Business only in the ordinary course of business. Without limiting the generality of the foregoing sentence, since such date there has not been: 

(a)        any material adverse change in the financial condition, results of the
Business, the Assets, and liabilities of Companies or material adverse change in the Companies’ contractual relations with any developer, builder or other Person who is a party to a Line Extension Agreement or with any of the other party to the
Assigned Contracts; or 
 (b)        any notice to Companies of
(i) termination of any Assigned Contract, except in the ordinary course of business and consistent with past practice, or (ii) any default by Companies under any Assigned Contract. 

3.1.9    Taxes. Except as set forth on Schedule 3.1.9: 

(a)        Companies have filed all Tax Returns that Companies were required to
file prior to the date of this Agreement, and all such Tax Returns are correct and complete in all material respects; 

(b)        all Taxes owed by Companies (whether or not shown on any Tax Return)
with respect to Tax Returns the due date of which preceded the date of this Agreement have been paid; 

(c)        to the Best of Knowledge of the Global Group, there are no outstanding
requests, agreements, consents or waivers to extend the statutory period of limitations applicable to the assessment or collection of any Taxes or deficiencies against Companies, and there are no pending or, to the Knowledge of the Global Group,
threatened examinations, audits, disputes or other proceedings concerning Companies’ liability for any Taxes, and no issues have been raised with Companies in any examination by any taxing authority that could reasonably be expected to result
in a proposed deficiency or assessment for any tax period following the Closing Date; 

(d)        there will be no Liens relating or attributable to Taxes on any of the
Assets as of the Closing Date; 
 (e)        Companies have, and as of the
Closing Date will have, withheld and paid all Taxes required to have been withheld and paid in connection with any amounts paid or owing to any Employee, director, shareholder, independent contractor, creditor, or other Person; and 

(f)        City shall have no transferee liability for any Taxes of Companies. 

  
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 3.1.10  Litigation. Except as set forth on the attached
Schedule 3.1.10, (a) there is no action, claim, lawsuit, proceeding, arbitration, grievance, citation, summons, subpoena or investigation of any nature, civil, criminal, regulatory (including any ACC complaint or proceeding), or
otherwise, at law or in equity, pending or, to the Knowledge of the Global Group, threatened against Companies, the Assets or any of them, or the Business, or relating in any way to the transactions contemplated by this Agreement (whether as to its
validity, enforceability, performance or otherwise), (b) neither Companies nor any of the Assets is a party to, subject to, or bound by any decree, order, injunction, settlement agreement, or arbitration decision or award (or agreement entered
into in any administrative, judicial or arbitration proceeding with any Governmental Authority) with respect to or affecting the properties, assets, personnel or business activities of Companies or that would prevent or restrict Companies from
entering into and performing this Agreement, and (c) no citation, fee, or penalty has been levied or asserted against Companies under any Environmental Laws or by the ACC or any other Governmental Authority within the three years prior to the
date of this Agreement, and no such citation, fee or penalty is currently pending or outstanding. 

3.1.11  All Assets. Except for the Excluded Assets and the Non-Owned Assets, the Assets include all
properties, assets, rights, licenses, agreements and contracts, the use of which are necessary for the continued conduct of the Business substantially in the manner as it has been conducted, including the service of all Customers in substantially
the same manner and substantially the same service levels as provided by Companies on the date of this Agreement. 

3.1.12  Title to Assets. Except as set forth on the attached Schedule 3.1.12, Companies have, at
and as of the date of this Agreement and will have at and as of the Closing Date, good and marketable title to all of the Assets free and clear of any Liens. Except as set forth on the attached Schedule 3.1.12, upon the Closing (but not
before), City will have and receive good and marketable title to, and possession of, all of the Assets free and clear of any Liens. Companies shall pay in full all Liens on the Assets at or prior to the Closing Date. Notwithstanding the foregoing,
Companies shall cause the exceptions on Schedule 3.1.12 to be removed on or before the Closing. 

3.1.13  Receivables. Companies shall deliver to City, no sooner than ten (10) Business Days before and no
later than three (3) Business Days before the Closing Date, a schedule of all Customer Accounts. The schedule of Customer Accounts will be true, correct and complete in all material respects. 

3.1.14  Accounts Payable. Companies shall deliver to City, no sooner than ten (10) Business Days
before and no later than three (3) Business Days before the Closing Date, a schedule of all accounts payable of Companies as of the delivery date. The schedule of accounts payable delivered by Companies to City will be true, correct and
complete in all material respects. 
 3.1.15  Contracts. 

(a)        The attached Schedule 3.1.15 contains a complete and accurate
list of all material agreements, contracts, commitments, and other instruments and arrangements (whether written or oral) of the types described below by which any of Companies or any of their assets, 

  
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 businesses, or operations receive benefits or to which any of Companies is a party or by
which any of the Companies is bound (collectively the “Contracts”): 

(i)        leases, licenses, permits, franchises, insurance policies, warranties,
guarantees, Governmental Approvals, and other contracts concerning or relating to Companies’ real property, 

(ii)       contracts for capital expenditures in excess of $20,000 each; 

(iii)      performance bonds, collection bonds, bid bonds, suretyship agreements and similar
instruments; 
 (iv)      agreements providing for the leasing to or by Companies of
personal property if the agreement is an Assumed Liability; 
 (v)       Line
Extension Agreements; and 
 (vi)      agreements or instruments under which Companies have
acquired or hold water rights. 
 (b)        Copies of Contracts. Global
Water has delivered to City true, complete and correct copies of all written Assigned Contracts, and all amendments, supplements, addenda, side agreements, renewals or extensions thereto. The Assigned Contracts do not include any oral Contracts.

 (c)        Contracts Enforceable. To the Best of Knowledge the Global
Group, all of the Contracts are in full force and effect and are enforceable against each party thereto in accordance with their terms. Companies have not released any material right or benefit under any of the Contracts. Except as set forth on the
attached Schedule 3.1.3, no Consent of any third party is required under any Contract as a result of or in connection with, and the enforceability of any Contract will not be affected in any manner by, the execution, delivery or performance
of this Agreement or the consummation of the transactions contemplated herein. 

(d)        No Association Membership. Companies are not a member of any
property owner’s association. 
 3.1.16  Water Rights. The only water rights claimed by Companies
as a basis to withdraw and deliver water to existing Customers and future customers of Companies are (a) the Service Area rights, (b) the rights set forth in Companies’ CC&Ns, and (c) the rights of Companies to water,
permits, contracts, subcontracts and other water related rights set forth in the attached Schedule 2.1(h). To the Knowledge of the Global Group, the water rights described above are all of the water rights that are needed for, or used by,
Companies to operate the Business as of the date hereof in a manner consistent with Companies’ prior practice. 

  
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 3.1.17  Environmental Matters. 

(a)        Except as disclosed on the attached Schedule 3.1.17, to the
Knowledge of the Global Group, since December 31, 2012, (i) Companies have not received any notice, citation, administrative ruling, summons, complaint, order, decree or other written communication alleging that Companies are not in
material compliance with any applicable Environmental Laws, that remains unresolved, and (ii) there is no claim pending or, to the Knowledge of the Global Group, threatened against Companies relating to any alleged or actual violation of any
Environmental Laws. 
 (b)        Except as disclosed on the attached Schedule
3.1.17, to the Knowledge of the Global Group there are no underground storage tanks or underground gasoline, diesel or similar tanks located at any of the Owned Real Property or any of the Leased Real Property. 

(c)        To the Knowledge of the Global Group, Global Water has provided or made
available to City all (and has not withheld from City any) assessments, studies, analyses, reports and test results, in the possession, custody, or control of the Global Group dated after December 31, 2012, relating to the environmental
conditions on, under, or about any of the Owned Real Property or any of the Leased Real Property. 

3.1.18  Line Extension Agreements. To the Best of Knowledge of the Global Group, Schedule 2.1(c),
lists each and every Line Extension Agreement and correctly and accurately shows for each such agreement, at and as of the date of this Agreement: (a) all advances received by Companies and (b) all funds subject to refund pursuant to the
agreement. No sooner than ten (10) Business Days before and no later than three (3) Business Days before the Closing Date, Companies shall deliver to City an updated schedule showing all of such information as of the date of delivery, and
the schedule delivered by Companies to City will, to the Best of Knowledge of the Global Group be true, correct and complete in all material respects. To the Best of Knowledge of the Global Group, Companies have delivered to City true, correct and
complete copies of all of the Line Extension Agreements, including all amendments, modifications, supplements, extensions and renewals thereof. 

3.1.19  Brokers. All negotiations relating to this Agreement and the transactions contemplated herein have
been carried on without the participation of any Person acting on behalf of the Global Group or any of their Affiliates in any way or manner as to give rise to any valid claim against the Global Group, or any of their Affiliates, or City for any
broker’s or finder’s commission, fee, or similar compensation, or for any bonus payable to any shareholder, director, officer, employee, agent, or sales representative of or consultant to any of the Global Group or any of their Affiliates
by reason of the Parties entering into this Agreement or upon the consummation of the transactions contemplated herein or otherwise, except to the extent officers or employees of Global or Companies might receive bonuses in connection with the
transactions contemplated herein, so long as such bonuses are paid from the Closing Payment or the Aggregate Growth Premium and otherwise not from Companies’ funds. 

3.2        Representations and Warranties of City. City represents and
warrants to and covenants with, the Global Group, as and at the date of this Agreement and as of the Closing Date, as provided in this Section 3.2: 

  
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 3.2.1     Status; Authorization. City is an
Arizona municipal corporation duly organized, validly existing, and in good standing under the laws of the State of Arizona with full corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder, and to
consummate the transactions contemplated hereby. The execution and delivery by City of this Agreement, and the consummation of the transaction contemplated herein, have been duly authorized by all requisite action of City. City has duly executed and
delivered this Agreement. This Agreement and all documents and instruments to be delivered by City under this Agreement constitute (or will constitute on their execution and delivery) the valid and legally binding obligation of City enforceable
against City in accordance with their terms, subject to bankruptcy, insolvency, reorganization, fraudulent transfer and conveyance, receivership, moratorium, and similar laws affecting creditor’s rights generally, and to the availability of
equitable remedies (whether asserted at law or in equity). 
 3.2.2     No Conflicts. The
execution, delivery, and performance by City of this Agreement and the consummation of the transactions contemplated herein do not and will not conflict with or result in a violation of or under (with or without the giving of notice or the lapse of
time or both) (i) any Applicable Law applicable to City or any of its properties or assets or (ii) any contract to which City is a party or by which it or any of its respective properties or assets may be bound or affected. 

3.3        General Provisions regarding Representation and Warranties. The
following provisions shall apply to all representations and warranties of any of the Parties to this Agreement: 

3.3.1     No Other Representation or Warranties. Each Party to this Agreement hereby expressly
acknowledges and agrees that it has not relied on, and no other Party has made, any representation or warranty, expressed or implied (all implied warranties being hereby expressly disclaimed), except for those representations and warranties that are
expressly set forth in the Agreement. 
 3.3.2     Specific Overrules General. To the extent
that any matter is addressed by a specific representation or warranty, any more general representation shall be deemed not to apply to such a matter. 

3.3.3     One Disclosure Suffices. Anything that is duly disclosed to City pursuant to this
Agreement, including on any Schedule hereto, shall be deemed to have been disclosed on all applicable schedules to this Agreement. 

3.3.4     AS-IS WHERE-IS CONDITION: CITY ACKNOWLEDGES THAT NO MEMBER OF THE GLOBAL GROUP HAS
MADE ANY REPRESENTATIONS OR WARRANTIES OR COVENANTS THAT ARE NOT EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN ANY OTHER DOCUMENT OR INSTRUMENT ATTACHED HERETO OR DELIVERED PURSUANT TO THE PROVISIONS OF THIS AGREEMENT. EXCEPT FOR THOSE
REPRESENTATIONS, WARRANTIES, AND COVENANTS EXPRESSLY SET FORTH HEREIN: (A) CITY IS ACQUIRING THE ASSETS AND ASSUMED LIABILITIES IN THEIR “AS-IS WHERE-IS” CONDITION AND THAT IT IS RELYING UPON ITS OWN INVESTIGATION AND ANALYSIS;
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 RELIED UPON AND WILL NOT RELY UPON, EITHER DIRECTLY OR INDIRECTLY, ANY REPRESENTATION OR
WARRANTY OF ANY MEMBER OF THE GLOBAL GROUP OR ANY AGENT OR EMPLOYEE OF THE GLOBAL GROUP WHICH IS NOT SET FORTH IN THIS AGREEMENT; (C) CITY HAS CONDUCTED SUCH INSPECTIONS AND INVESTIGATIONS REGARDING THE ASSETS AS CITY DEEMS NECESSARY AND SHALL
RELY UPON SAME (AND NOT ON ANY REPRESENTATION, INFORMATION OR DOCUMENTATION RECEIVED FROM THE GLOBAL GROUP THAT IS NOT EXPRESSLY SET FORTH IN THIS AGREEMENT); AND (D) CITY FURTHER ACKNOWLEDGES AND AGREES THAT THE PROVISIONS OF THIS SECTION
3.3.4 WERE A MATERIAL FACTOR IN THE DETERMINATION OF THE CONDEMNATION PRICE. 
 3.3.5
    ACKNOWLEDGEMENT. THE GLOBAL GROUP ACKNOWLEDGES THAT CITY HAS MADE NO REPRESENTATIONS OR WARRANTIES OR COVENANTS THAT ARE NOT EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN ANY OTHER DOCUMENT OR INSTRUMENT ATTACHED HERETO OR
DELIVERED PURSUANT TO THE PROVISIONS OF THIS AGREEMENT. THE GLOBAL GROUP ACKNOWLEDGES AND AGREES THAT THE REPRESENTATIONS AND WARRANTIES OF THE GLOBAL GROUP IN THIS SECTION 3.1 WERE AND ARE A MATERIAL INDUCEMENT TO CITY ENTERING INTO THIS AGREEMENT.

 ARTICLE 4 

ADDITIONAL COVENANTS 

4.1        Transferred Employees. 

4.1.1     Employees. City shall offer employment to all of the employees of Global Water listed
on Schedule 4.1.1 (the “Employees”) at his or her same base salary or hourly wage (which salaries and wages Companies have delivered to City and which the Global Group represents to City are true and correct) and otherwise
upon such terms and conditions as City determines in its sole discretion, and subject to City’s normal hiring policies and procedures. City shall employ, as of the day after the Closing Date, the Employees who accept City’s offer of
employment and who satisfy City’s normal hiring policies and procedures (each a “Transferred Employee”). Global Water shall terminate its employment of each Transferred Employee on such date. Each Transferred Employee shall be
employed by City for a period of twenty (20) weeks after the Closing Date, subject to earlier termination for cause. Effective on the Closing Date, each Transferred Employee shall be entitled to the same employee benefits that are available to
similarly situated new employees of City and on the same basis they are so provided or offered to such new employees of City (including health insurance coverage effective as of the day after the Closing Date). A Transferred Employee who desires to
be employed by City after the expiration of such twenty (20) week period must apply for employment with City in accordance with City’s policies and procedures and Applicable Law. 

4.1.2     Pre-Closing Pay. Global Water shall be responsible for paying all, and City shall have
no responsibility for paying any, of the severance compensation or benefits of any and every kind and description, including without limitation base pay, salaries, wages, bonuses, commissions, severance and vacation, sick days and personal time off,
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 earned by or otherwise payable to each Transferred Employee through and including the
Closing Date and for each other Employee through and including his or her termination of employment by Global Water. 

4.2        Conduct of Business. 

4.2.1     Preservation of Business. From the date of this Agreement and through and including
the Closing Date (and thereafter with respect to any covenant or agreement extending beyond the Closing Date), unless otherwise consented to by City in writing, Companies shall: (a) carry on the Business in, and only in, the ordinary course and
consistent with their prior practice; (b) maintain the Assets in the same operating condition and repair as at the date of this Agreement, ordinary wear and tear excepted; (c) use reasonable efforts to preserve intact their present
business organizations; (d) use reasonable efforts to preserve their relationships with Customers, developers, builders, vendors, suppliers and others having business dealings with Companies; (e) use reasonable efforts to keep available to
City the opportunity to employ the Employees; and (f) keep and maintain in full force and effect all of their existing insurance policies with respect to the Assets or the Business; all with the goal and intent that the goodwill and ongoing
Business shall be in all material respects unimpaired as of the Closing Date. 
 4.2.2     Consent
Required. From the date of this Agreement and through and including the Closing Date (and thereafter with respect to any covenant or agreement extending beyond the Closing Date), unless otherwise consented to by City in writing, Companies shall
not: (a) except in the ordinary course of the conduct of the Business and consistent with Companies’ past practice, enter into any contract or commitment, incur any liability (absolute or contingent), waive any right, or enter into any
other transaction that could materially and adversely affect the Assets or the Business; (b) permit any Lien (monetary or otherwise) to be imposed on or placed against any of the Assets (and, if so imposed or placed, shall cause the same to be
removed prior to the Closing Date); (c) change any compensation or benefits payable to or in respect of any Employee, except for normal annual cost of living and/or merit increases in the ordinary course of the conduct of the Business and
consistent with Companies’ past practice; or (d) take or omit to take any action that, if taken or omitted prior to the date of this Agreement, would constitute a breach of any of the representations or warranties of Companies in this
Agreement or in any of the Schedules. 
 4.3        Further Actions. 

4.3.1     Good Faith Efforts. City and Companies agree to use reasonable good faith efforts to
take all actions and to do all things necessary, proper or advisable to consummate the transactions contemplated herein as soon as is reasonably possible, including by way of illustration obtaining the Final Order. 

4.3.2     Obtain Consents. Except for the approvals required for transfer of the CAP agreements
which will be obtained on a post-closing basis, City and Companies shall, as promptly as practicable, file or supply, or cause to be filed or supplied, all applications, notifications and information required to be filed or supplied by it pursuant
to Applicable Law in connection with this Agreement and the consummation of the transactions contemplated herein. 

  
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 City and Companies, as promptly as practicable, shall use all reasonable efforts to obtain
all Consents (including, without limitation, all Governmental Approvals and Consents required under any Contract) necessary to be obtained hereunder in order to consummate the transactions contemplated herein. 

4.3.3     Cooperation. City and Companies shall, and shall cause each of their Affiliates to,
coordinate and cooperate with one another in exchanging such information and providing such assistance as may be reasonably requested by a Party in connection with the filings and other actions contemplated in this Agreement. 

4.3.4     Notification. At all times prior to the Closing Date, City and Companies shall
promptly notify one another in writing of any fact, condition, event, or occurrence that will or may result in the failure of any of the conditions precedent contained in Article 5, promptly upon becoming aware of the same. 

4.3.5     Access to Companies. Unless and until this Agreement is terminated in accordance with
Article 7, until the Closing Date, Companies shall, unless prohibited by Applicable Law, provide to City and its employees, consultants, and representatives complete access to Companies’ facilities, plants, properties, assets, books, records,
contracts, agreements, ACC filings and directives, ADWR filings and directives, ADEQ filings and directives, and other information reasonably requested by City or its employees, consultants or representatives, and Global Water and Companies shall
cause the officers, employees, consultants, and other agents and representatives of Companies to cooperate fully with City and its officers, employees, attorneys, accountants, consultants, advisers, and other agents and representatives in connection
with City’s due diligence investigation and integration planning. 
 4.3.6     City’s
Due Diligence. In addition to the provisions of Article 5 below, commencing on the date of this Agreement and continuing until the Closing Date, City may conduct a due diligence review, investigation and inquiry respecting the Assets, the
Assumed Liabilities, and the Business and including, without limitation, the following: (i) an engineering review of all of Companies’ assets; (ii) a review of Companies’ employee records to the extent permitted under Applicable
Law; (iii) volumetric consumption data and other customer data; (iv) a review of existing Line Extension Agreements and any similar agreements; (v) a financial analysis and projection of revenues, expenses and capital expenditures;
and (vi) such other matters as City deems relevant in its discretion. For the avoidance of doubt, the obligation of City to proceed to Closing is not subject to City’s satisfaction with any further due diligence investigation (other than
relating to the updating of Schedules pursuant to Section 4.11). 
 4.3.7     City’s
Acknowledgments. The assets described on Schedule 4.3.7 (the “Non-Owned Assets”) are not owned by the Condemnation Defendants and are not included in the Assets. City acknowledges that it will need to, if it so desires,
secure replacements or substitutes for the Non-Owned Assets. Condemnation Defendants make no representation or warranty that the Assets are all assets City will require for continued operation of the Business. City is not acquiring any assets of
Condemnation Defendants that are not used by the Condemnation Defendants in the ordinary course of the Business. 

  
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 4.3.8     Coverage. During the Growth Period,
City agrees to comply with the provisions of Section 9 of City’s Resolution No. 09-15 (as it exists on the date hereof) adopted by its mayor and council on March 17, 2015. 

4.4        Further Assurances. Upon and following the Closing Date, City and
Condemnation Defendants shall, and shall cause each of their Affiliates to, from time to time and without any additional consideration, execute and deliver such additional stipulations, instruments, documents, conveyances, or assurances consistent
with the terms of this Agreement and take such other actions consistent with the terms of this Agreement as shall be necessary, or otherwise reasonably requested by any other Party, to confirm and assure the rights and obligations provided for in
this Agreement and render effective the consummation of the transactions contemplated hereby. In the event this Agreement does not proceed to Closing, is terminated, or both, City and Condemnation Defendants shall, and shall cause each of their
Affiliates to, from time to time and without any additional consideration, execute and deliver such additional stipulations, instruments, documents, conveyances, or assurances, consistent with Article 7. 

4.5        Notice to ACC. After the Closing, and after entry of the Final
Order of Condemnation, Valencia will file a notice with the ACC that the Assets have been condemned and that its status as public service corporation has been terminated by the Court, and requesting that the ACC reflect the termination of the
CC&Ns on the records of the ACC. 
 4.6        Transition Services
Agreement. On the Closing, Companies and City agree to enter into a Transition Services Agreement in the form attached as Exhibit D, providing for operational and management assistance to be provided by Companies or their Affiliates to City
after the Closing Date for the period of time set forth therein. The Transition Services Agreement may include a form of a nonexclusive license to City for the use of FATHOM, if and to the extent provided therein. 

4.7        Costs of Transaction. Except as expressly provided otherwise in
this Agreement, each Party and each Party’s Affiliates shall bear their own costs and expenses, including the fees and costs of attorneys, accountants, financial advisors and consultants, in connection with the negotiation, due diligence
investigation, preparation and consummation of this Agreement and the transactions contemplated in this Agreement. There shall be no proration of any item of cost or expense relating to the Assets except as expressly provided in this Agreement. 

4.8        Public Announcements. No Party, no Party’s Affiliates, and no
shareholders, directors, officers, employees, agents or representatives of a Party or its Affiliates, shall issue any press release or make any public disclosure or announcement (or any statement that a reasonable natural person might believe could
result in a public disclosure) with respect to this Agreement or the transactions contemplated hereunder, unless City and Global agree in writing on the text and timing thereof; provided, however, nothing contained in this Section 4.8 shall
prevent a Party at any time from furnishing any information to any Governmental Authority if required by Applicable Law or to comply with any Applicable Law. Unless otherwise required by an Applicable Law or a Governmental Authority or under this
Agreement, each Party agrees that such Party and such Party’s shareholders, directors, officers, employees, agents and those of its 

  
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 Affiliates shall keep in strict confidence the fact and the content of the negotiations and
agreements concerning the transactions contemplated in this Agreement until such time as City and Global Water agree on a press release or public announcement or otherwise consent in writing. 

4.9        Confidentiality Agreement. City and Global Water have entered into
the confidentiality letter agreement dated November 8, 2012, as extended by letter agreement dated September 2, 2014 (the “Confidentiality Agreement”). Section 7 of the Confidentiality Agreement is hereby amended to
be consistent with the provisions of Section 4.1.1 of this Agreement. The Confidentiality Agreement otherwise shall continue in accordance with its terms until the Closing, at which time it shall terminate. In addition, City will, within ninety
(90) days after the Closing Date, delete from information delivered by Companies to City on or prior to the Closing Date all of the information that City determines in good faith does not relate either to (a) the water utility system being
condemned by City, (b) the Assets and the Assumed Liabilities, or (c) any of the covenants or obligations of City or the Global Group under this Agreement. 

4.10      Retention of Excluded Books and Records. The Global Group shall maintain and
retain, at a site in Maricopa County, Arizona, all of the Excluded Books and Records that in any way pertain to the Business or the Assets for a period of seven (7) years after the Closing Date. City shall have the continuing right to inspect
and copy any or all of such Excluded Books and Records after the Closing Date from time to time during normal business hours and upon reasonable notice to Global Water for the entire seven (7) year period after the Closing Date. Similarly,
Companies shall have the continuing right to inspect and copy after the Closing Date any and all of Companies’ books and records acquired by City hereby from time to time during normal business hours and upon reasonable notice to City for the
entire seven (7) year period after the Closing Date. 
 4.11      Supplementation
and Correction of Information. From time to time prior to the Closing, the Global Group shall have the right (but not the obligation) to supplement or amend the Schedules hereto with respect to any matter hereafter arising after the date hereof
(each a “Schedule Supplement”). Any disclosure in any such Schedule Supplement shall not be deemed to have cured any inaccuracy in or breach of any representation or warranty contained in this Agreement, including for purposes of
the indemnification or termination rights contained in this Agreement or of determining whether or not the conditions set forth in Section 6.2.1 have been satisfied; provided, however, that if the Global Group notifies City in writing at the
time of the delivery of any Schedule Supplement that such Schedule Supplement would cause the condition set forth in Section 6.2.1 not to be satisfied, City shall have ten (10) Business Days to request any supplemental information relevant to
the Schedule Supplement that City in its reasonable discretion deems necessary or desirable and the Global Group shall promptly provide City with such supplemental information. If City does not notify the Global Group in writing within ten (10)
Business Days after receipt by City of all such supplemental information that City has elected to terminate this Agreement, then the delivery of any such Schedule Supplement will be deemed to have cured any inaccuracy in or breach of representation
or warranty that otherwise might have existed hereunder and City shall be deemed to have irrevocably waived any right to terminate this Agreement with respect to such new matter and, further, shall have irrevocably waived its right to
indemnification with respect to such new matter. In the event the 

  
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 Global Group provides a notice set forth in this Section 4.12 along with a Schedule
Supplement, the Global Group shall also promptly provide any additional information relating thereto as City may reasonably request. 

ARTICLE 5 
 REAL
PROPERTY 
 5.1        Escrow Agent and Instructions. Promptly after
execution of this Agreement by the Parties, an escrow (the “Escrow”) shall be opened with Escrow Agent to facilitate the consummation of the condemnation of the Owned Real Property pursuant to this Agreement. 

5.1.1     Escrow Instructions. This Article 5 constitutes escrow instructions to Escrow Agent.
However, if required by Escrow Agent, City and Companies shall execute and deliver to Escrow Agent printed form escrow instructions to the extent they are consistent with this Agreement. In the event of any conflict between the provisions of the
printed form escrow instructions and this Agreement or any deed, instrument or document in connection with the transactions contemplated herein, the provisions of this Agreement or such deed, instrument or document shall control. No provision of the
escrow instructions shall excuse any non-performance by a Party of such Party’s covenants and obligations under this Agreement or such deed, instrument or document. 

5.1.2     Escrow Agent’s Acceptance. The assignment by Escrow Agent of an escrow number to
this transaction and the opening of the Escrow by Escrow Agent shall constitute Escrow Agent’s acceptance of the instructions to, and the obligations of, Escrow Agent as set forth in this Article 5 and, if applicable, the printed form escrow
instructions. 
 5.1.3     Date Escrow Opened. Escrow Agent shall notify the Parties in
writing of the date on which it received fully executed copies of this Agreement and which notice is Escrow Agent’s further agreement to act as Escrow Agent hereunder. 

5.1.4     Closing of Escrow. The conveyance and acquisition of the Owned Real Property and the
consummation of the transactions contemplated in this Article 5 shall occur on the Closing. City and Companies each authorize Escrow Agent on the Closing Date (but not before) to: (a) execute an affidavit of real property value as required by
Arizona law; and (b) deliver the Final Order in a recordable form to the Maricopa County Recorder for recording to vest title to the Assets in City. 

5.1.5     Code Reports. Escrow Agent is the party responsible for closing the transactions
related to the Owned Real Property within the meaning of Code Section 6045(e)(2)(A). Escrow Agent shall file all necessary information reports, returns and statements (collectively, “Reports”) regarding such transactions as are
required by the Code, including, but not limited to, the reports required under Code Section 6045. Escrow Agent further agrees to indemnify and hold Companies, City and their respective attorneys harmless for, from and against any and all
claims, costs, liabilities, penalties, and expenses resulting from Escrow Agent’s failure to file, or incorrectly filing, the Reports that Escrow Agent is hereby required to file. 

  
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 5.1.6     Property Taxes and Escrow Fees.
Escrow fees shall be paid one-half by City and one-half by Companies. Companies shall pay on or before the Closing Date all real property taxes and assessments and other similar taxes and any interest and penalties, on Owned Real Property that would
be a Lien on any Owned Real Property at or as of the Closing Date. Notwithstanding the foregoing or any other provisions of this Agreement to the contrary, on or before that Closing Date, Companies shall pay or cause to be paid ‘all real
property taxes and any interest and penalties on the Owned Real Property that are due and unpaid as of the date of this Agreement or the Closing Date pursuant to ARS Section 12-1124. 

5.1.7     No New Assessments. Companies shall not, without the prior written consent of City, in
its discretion, consent to the imposition of any assessment against the Owned Real Property if such assessment would be required to be paid, in whole or in part, by City. Companies shall give City timely written notice of any proposed governmental
action, including, but not limited to, the formation of an improvement district or other similar district that could result in the imposition of assessments against the Owned Real Property. 

ARTICLE 6 

CONDITIONS PRECEDENT; CLOSING DELIVERIES 

6.1        Conditions to Obligations of All Parties. The obligations of each
of the Parties to consummate the transactions contemplated by this Agreement shall be and are subject to the fulfillment on or prior to the Closing Date, or the written waiver by all of the Parties, of each of the following conditions, which each
Party agrees to use reasonable efforts in good faith to fulfill or cause to be fulfilled: 
 6.1.1
    Final Order. The Court in the Condemnation Action shall have signed and entered the Final Order and, if any third party has formally intervened in the Condemnation Action, all appeal periods shall have run with no appeals
having been filed (or, if any appeals have been filed, they have been decided in favor of the Parties), and the Final Order shall not have been recorded with the Maricopa County Recorder’s office prior to Closing. 

6.1.2     Injunction. Consummation of the transactions contemplated hereby shall not have been
restrained, enjoined or otherwise prohibited by any Applicable Law, including any order, injunction, decree, or judgment of any court or other Governmental Authority. No court or other Governmental Authority shall . have determined Applicable Law to
make illegal the consummation of the transactions contemplated hereby, and no proceeding with respect to the application of any such Applicable Law to such effect shall be pending. 

6.2        Conditions to Obligations of City. The obligations of City to
consummate the transactions contemplated hereby shall be subject to the fulfillment (or wavier by City, in its sole discretion) on or prior to the Closing Date of the following additional conditions: 

6.2.1     Representations and Performance. The representations and warranties of the Global
Group contained in this Agreement shall be true and correct in all material respects at and as of the date hereof and as of the Closing Date. Condemnation Defendants shall have duly performed and complied in all material respects with all covenants
and agreements and 

  
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 conditions required by this Agreement to be performed or complied with by Condemnation
Defendants prior to or on the Closing Date. 
 6.2.2     Condemnation Compensation. No Persons
will be entitled to any compensation or remuneration under the Condemnation Action other than Companies. 
 6.2.3
    Financing. City shall have received the proceeds of, and there shall have closed, the sale of bonds or other financing in an amount sufficient, in City’s sole discretion, to finance the Closing Payment and such costs
and expenses relating to such financing, incurred in connection with entering into or in performing this Agreement as City determines in its sole discretion (the “Financing”). 

6.2.4     Consents and Governmental Approvals. All Consents (including by way of illustration
Consents to the assignment of the Assigned Contracts) and all Governmental Approvals required prior to the Closing of the transactions contemplated in this Agreement shall have been obtained. 

6.2.5     Final Order. Condemnation Defendants shall have complied with Sections 2.2, 2.3 and
2.4 and the court shall have entered the Final Order. 
 6.2.6     Tax Clearance. Companies
shall have delivered to City on or before the Closing Date a response from the Arizona Department of Revenue to Companies’ tax clearance application to the Arizona Department of Revenue that Companies are in good standing in all material
respects. 
 6.2.7     Other Documents. Condemnation Defendants will deliver to City or the
Escrow Agent as applicable on or before the Closing Date: 
 (a)        a
Transition Services Agreement duly executed by Condemnation Defendants; 

(b)        an Assignment and Assumption Agreement in the form attached hereto as
Exhibit E, duly executed by Condemnation Defendants; 
 (c)        such
other evidence of the performance of all covenants and satisfaction of all conditions required of Condemnation Defendants by this Agreement, at or prior to the Closing Date, as City or its counsel may reasonably require; 

(d)        an affidavit in such form as is acceptable to Escrow Agent and to the
Parties stating under penalty of perjury that neither of Companies is a “foreign person,” as such term is defined in Code Section 1445(f)(3); 

(e)        wire transfer instructions for the payment of the Closing Payment, which
shall be furnished by Companies to Escrow Agent at least three (3) Business Days before the Closing Date; and 

  
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 (f)        the titles to all
vehicles to be sold hereunder to City duly endorsed for transfer to City by Condemnation Defendants and WMC, as applicable. 

6.2.8     No Other Conditions. City acknowledges and agrees that there are no conditions to its
obligations under this Agreement that are not expressly set forth herein. By way of example, and not limitation, City’s obligations under this Agreement are not contingent upon approval by the ACC, but the Condemnation Defendants acknowledge
that City has no control over the acts of non-Parties, such as a non-Party’s challenge to the Final Judgment or Final Order or to City’s bond financing. 

6.3        Conditions to Obligations of Condemnation Defendants. The
obligation of Condemnation Defendants to consummate the transactions contemplated hereby shall be subject to the fulfillment (or waiver by Condemnation Defendants in their sole discretion), on or prior to the Closing Date, of the following
additional conditions: 
 6.3.1     Representations, Performance. The representations and
warranties of City contained in this Agreement shall be true and correct in all material respects at and as of the date hereof, and as of the Closing Date. City shall have duly performed and complied in all material respects with all agreements and
conditions required by this Agreement to be performed or complied with by City prior to or on the Closing Date. 

6.3.2     Action by Governmental Authority. No Governmental Authority shall have taken or
threatened to take any action that could, in the Global Group’s reasonable discretion, have a material adverse effect on any member of the Global Group or its Affiliates. 

6.3.3     Final Order. City shall have complied with Sections 2.2, 2.3 and 2.4 and the court
shall have entered the Final Order. 
 6.3.4     Condemnation Price and Other Documents. City
will deliver to Condemnation Defendants or the Escrow Agent at or prior to Closing: 

(a)        the Closing Payment in the manner specified in Section 2.13,
subject to adjustment in Section 2.16; 
 (b)        a Transition Services
Agreement duly executed by City; 
 (c)        an Assignment and Assumption
Agreement duly executed by City; 
 (d)        if issued and entered by the
court, the Final Order in a recordable form for recording on, but not prior to, the Closing Date; and 

(e)        such other evidence of the performance of all covenants and satisfaction
of all conditions required of City by this Agreement, at or prior to the Closing Date, as Condemnation Defendants or their counsel may reasonably require. 

6.3.5     No Other Conditions. Condemnation Defendants acknowledge and agree that there are no
conditions to its obligations under this Agreement that are not expressly set forth herein. By way of example and not limitation, the Condemnation Defendants’ obligations 

  
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 under this Agreement are not contingent upon approval by the ACC, but City acknowledges
that the Condemnation Defendants have no control over the acts of non-Parties, such as a non-Party’s challenge to the Final Judgment or Final Order or to City’s bond financing. 

ARTICLE 7 

TERMINATION 

7.1        Termination. This Agreement may be terminated at any time prior to
the Closing Date: (a) by City by written notice to Condemnation Defendants (i) pursuant to either Section 2.11 or Section 4.11, or both, (ii) if the representations and warranties of Condemnation Defendants shall not have
been true and correct in all material respects as of the date when made or (iii) if any of the conditions set forth in Section 6.1 or 6.2 shall not have been, or if it becomes apparent to City in its reasonable discretion that any of such
conditions will not be, fulfilled by 5:00 p.m. Phoenix, Arizona time on July 15, 2015, unless such failure shall be due to the failure of City to perform or comply with any of the covenants, agreements or conditions hereof to be performed or
complied with by it prior to the Closing Date; or (b) by Condemnation Defendants by written notice to City if (i) the representations and warranties of City shall not have been true and correct in all material respects as of the date when
made or (ii) any of the conditions set forth in Section 6.1 or 6.3 shall not have been, or if it becomes apparent to Condemnation Defendants in their reasonable discretion that any of such conditions will not be, fulfilled by 5:00 p.m.
Phoenix, Arizona time on July 15, 2015, unless such failure shall be due to the failure of Condemnation Defendants to perform or comply with any of the covenants, agreements or conditions hereof to be performed or complied with by them prior to
the Closing Date. 
 7.2        Effect of Termination. In the event of the
termination of this Agreement pursuant to the provisions of Section 7.1: (a) this Agreement shall terminate and have no further force or effect, without any liability to any Person in respect hereof or of the transactions contemplated
hereby on the part of any Party hereto, or any of its Affiliates or any of its or its Affiliates’ directors, officers, employees, agents, consultants, representatives, advisers, or stockholders, except: (i) as specified in Subparagraphs
(b) and (c) below; or (ii) for any liability resulting from such Party’s material breach of this Agreement; (b) City shall deliver to Condemnation Defendants or destroy (and, if destroyed, will so represent to Condemnation
Defendants) all materials delivered to or acquired from Condemnation Defendants by City (“Condemnation Defendants’ Materials”), shall agree on a stipulation to dismiss the Condemnation Action with prejudice (with the Parties to
bear their own attorneys’ fees and costs) (“Stipulation of Dismissal with Prejudice”), and the Final Judgment, Partial Satisfaction of Judgment and Final Order, as applicable, shall be (i) deemed void and of no effect and
(ii) simultaneous with the filing of the Stipulation of Dismissal with Prejudice, also vacated by stipulation of the Parties; (c) City will maintain the confidentiality of, and not disclose to any third Person (other than its attorneys and
other consultants to the extent reasonably required for the negotiation and processing of the transaction contemplated by this Agreement) any information obtained by City from or through Condemnation Defendants’ Materials except to the extent
such information is generally available to the public or required to be disclosed pursuant to legal process or Applicable Law; and (d) Escrow Agent shall return all materials relating to this Agreement in its possession. 

  
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 ARTICLE 8 

NONCOMPETE 

8.1        Noncompete. During the Restrictive Period (defined below), the
Global Group shall not, and shall not permit any Affiliate of the Global Group to, do any of the following: 

(a)        engage in the Business anywhere in City’s current Municipal
Planning Area and, to the extent not the same area, in the geographical areas of the Certificated Areas; or 

(b)        acquire a debt or equity interest or an option to acquire such an
interest in any Person engaged in the Business anywhere in the Territory. 
 As used herein, the term “Restrictive
Period” means the period of time that commences on the Closing Date and ends on the five (5) year anniversary of the Closing Date; provided, however, the Restrictive Period shall be suspended and shall not run during any period of time
during which any member of the Global Group or any of their Affiliates is in default under this Section 8.1. 

8.2        Injunctive Relief. The Global Group recognizes that City will
suffer irreparable damage if any of the Global Group or any Affiliate of the Global Group fails to comply with any of the covenants and obligations under Section 8.1 and acknowledges that it will be difficult, if not impossible, for City to
compute the damages to City as a result of any breach of the covenants and obligations under Section 8.1 and, therefore, City is without an adequate legal remedy in the event any of the Global Group or any Affiliate of the Global Group breaches
any of such covenants or obligations. The Global Group expressly agrees that City shall be entitled to seek from any court of competent jurisdiction an order to enjoin any such breach, threatened or actual, of any of the covenants or obligations
contained in Section 8.1. In addition to the foregoing provisions of this Section 8.2 or any other provisions of this Agreement, City may pursue any and all other remedies, at law or in equity, available to City by reason of such breach or
threatened breach by any of the Global Group or any Affiliate of the Global Group of any of the covenants or obligations under Section 8.1. 

ARTICLE 9 

INDEMNIFICATION 

9.1        Indemnification By Global Group. To the extent permitted by
Applicable Law, but subject to the limitations set forth in Section 9.4 and 9.5, each of the Global Group, jointly and severally covenants and agrees to defend, indemnify and hold harmless City, and its council members, officers, managers,
employees, attorneys, consultants, advisors, agents, representatives and Affiliates (collectively, the “City Indemnitees”) for, from and against, and to pay or reimburse City Indemnitees for, any and all claims, amounts paid in
settlement of claims, liabilities, obligations, losses, fines, penalties, costs, royalties, proceedings, deficiencies and damages (whether absolute, accrued, conditional, or otherwise and whether or not resulting from third party claims), including
without limitation any out-of-pocket expenses and the reasonable fees and costs of attorneys, accountants, consultants and experts, incurred in the investigation or defense of any of the same or in asserting any of their respective rights hereunder,
whether or not suit is brought and at trial and all levels of appeal and in bankruptcy, insolvency or similar 

  
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 proceedings, arising under or resulting in any way to this Agreement, including the
Schedules, but excluding any consequential damages (collectively, “Losses”), resulting from or arising out of: 

(a)        any material inaccuracy of any representation or warranty by the Global
Group contained in this Agreement; 
 (b)        any failure of Condemnation
Defendants to perform or breach of any covenant or agreement in this Agreement or in any certificate, instrument or document delivered or to be delivered by any of the Global Group pursuant to this Agreement or to fulfill any other obligation in
respect hereof or thereof; 
 (c)        any claims asserted from and after
May 15, 2006, and through and including the Closing Date by any Governmental Authority based on, arising out of, or relating to any Tax liability of any of the Global Group (or their shareholders or owners); and 

(d)        any failure on the part of the Global Group to pay or perform any of the
Retained Liabilities; 
 (e)        any and all claims and liabilities to the
extent based on, arising out of, or relating to any of the Excluded Assets; and 

(f)        any breaches by the Global Group of any of its obligations under
Sections 2.9.1 and 2.9.2. 
 Notwithstanding the foregoing or anything else contained in this Agreement, no member of the Global Group
shall have any liability for Losses incurred by City Indemnitees based on information about the Global Group or the transactions contemplated by this Agreement (including information provided by the Global Group in connection with this Agreement)
that is included in City’s bond offering documents or otherwise disclosed in connection therewith. 

9.2        Indemnification by City. To the extent permitted by Applicable
Law, but subject to the limitations set forth in Section 9.4 and 9.5, City covenants and agrees to defend, indemnify and hold harmless each member of the Global Group, and their officers, directors, employees, agents, advisors, representatives,
and Affiliates (collectively, the “Global Indemnitees”) from and against, and to pay or reimburse Global Indemnities for, any and all Losses resulting from or arising out of: 

(a)        any material inaccuracy of any representation or warranty by City
contained in this Agreement; or 
 (b)        any failure of City to perform any
covenant or agreement hereunder or to fulfill any other obligation in respect hereof. 

9.3        Indemnification Procedures. In the case of any claim by a City
Indemnitee or a Global Indemnitee (any of which, an “Indemnified Party”) for indemnification under this Article 9, notice shall be given by the Indemnified Party to the Party required to provide indemnification (the
“Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any 

  
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 claim as to which indemnity may be sought hereunder. The notice shall specify the factual
basis of the claim in reasonable detail to the extent known by the Indemnified Party. 
 9.3.1
    Third Party Claims. With regard to third party claims, the Indemnified Party shall permit the Indemnifying Party (at the expense of the Indemnifying Party) to assume the defense of any third party claim or any litigation
resulting therefrom; provided that (i) the counsel for the Indemnifying Party who shall conduct the defense of such claim or litigation shall be reasonably satisfactory to the Indemnified Party, (ii) the Indemnified Party may participate
in the defense at the Indemnified Party’s expense, and (iii) the failure by any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its indemnification obligation under this Agreement except to
the extent that such omission results in a failure of actual notice to the Indemnifying Party and the Indemnifying Party is materially prejudiced as a result of the failure to give notice. Except with the prior written consent of the Indemnified
Party, no Indemnifying Party, in the defense of any such claim or litigation, shall consent to entry of any judgment or enter into any settlement that provides for injunctive or other nonmonetary relief affecting the Indemnified Party or that does
not include as an unconditional term thereof the giving by each claimant or plaintiff to such Indemnified Party of a release from all liability with respect to such claim or litigation. In the event that the Indemnified Party shall in good faith
determine that the conduct of the defense of any claim subject to indemnification hereunder or any proposed settlement of any such claim by the Indemnifying Party might be expected to affect adversely the Indemnified Party’s tax liability or
the ability of the Indemnified Party to conduct its business, or that the Indemnified Party may have available to it one or more defenses or counterclaims that are inconsistent with one or more of those that may be available to the Indemnifying
Party in respect of such claim or any litigation relating thereto, the Indemnified Party shall have the right at all times to take over and assume control over the defense, settlement, negotiations or litigation relating to any such claim at the
sole cost of the Indemnifying Party, provided that if the Indemnified Party does so take over and assume control, the Indemnified Party shall not settle such claim or litigation without the written consent of the Indemnifying Party, such consent not
to be unreasonably withheld. In the event that the Indemnifying Party does not accept the defense of any matter as above provided, the Indemnified Party shall have the right to defend against any such claim or litigation and shall be entitled to
settle such claim or litigation or agree to pay in full such claim. In any event, the Indemnifying Party and the Indemnified Party shall cooperate in the defense of any claim or litigation subject to this Section 9.3, including tax audits and
appeals, and the records of each of them shall be available to the other to the extent relevant to such defense. 

9.3.2     Claims for Losses other than Third Party Claims. With regard to a claim for
indemnification for Losses other than a third party claim, the Indemnifying Party shall within twenty (20) days after receiving notice of the claim, give notice to the Indemnified Party of the acceptance or rejection of the claim by the
Indemnifying Party. A notice of rejection of a claim will create a Dispute under Article 10, which shall be resolved pursuant to the provisions of Article 10. 

9.4        Time Limitations. The Global Group will have liability with
respect to Section 9.1(a) only if on or before the date which is twenty four (24) months after the Closing Date, City notifies the member of the Global Group from which it is seeking indemnification in writing of the claim, specifying the
factual basis of the claim in reasonable detail to the extent then known 

  
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 by City. City will have liability with respect to Section 9.2(a) only if on or before
the date which is twenty four (24) months after the Closing Date, the Global Group notifies City in writing of the claim, specifying the factual basis of the claim in reasonable detail to the extent then known by such Party. Notwithstanding the
foregoing, if before 5:00 p.m. (Arizona time) on the date which is twenty four (24) months after the Closing Date, any party against which an indemnification claim has been made hereunder has been properly notified in writing of such claim and
such claim has not been finally resolved or disposed of as of such date, then such claim shall continue to survive and shall remain a basis for indemnity hereunder until such claim is finally resolved or disposed of in accordance with the terms of
this Agreement. 
 9.5        Limitations on Amount. 

9.5.1     Limitation on Obligation of Global Group. No claim shall be asserted against Global
Group under this Article 9 until all such claims in the aggregate equal or exceed $500,000. In addition, no claims shall be asserted against Global Group under this Article 9 which, in the aggregate, exceed the sum of $10,000,000. City’s
recourse under this Article 9 is not limited in any way to or by the proceeds, if any, recoverable or received by Global Group under any policy of insurance. 

9.5.2     Limitation on Obligation of City. No claim shall be asserted against City under this
Article 9 until all such claims in the aggregate equal or exceed $500,000. In addition, no claims shall be asserted against City under this Article 9 which, in the aggregate, exceed the sum of $10,000,000. Global Group’s recourse under this
Article 9 is not limited in any way to or by the proceeds, if any, recoverable or received by City under any policy of insurance. For the avoidance of doubt, no limitation on indemnification contained herein (e.g., basket, cap and time limitation)
shall apply to the payment of the Condemnation Price or to Section 2.16. 

9.6        Exclusive Remedy. Except for injunctive and equitable relief
pursuant to Section 8.2, the right to indemnification provided in this Article 9 is the sole and exclusive remedy of City on the one hand and the Global Group on the other hand following the Closing. 

9.7        No Offset. The City shall have no right to offset any amounts due
to City hereunder against any Growth Premium payments due to the Global Group pursuant to Section 2.17. 
 ARTICLE 10 

DISPUTE RESOLUTION 

10.1     Disputes. Except for equitable relief sought by a Party (as provided in
Section 8.2), any claim, dispute, or other matter in controversy (a “Dispute”), whether based on contract, tort, statute, or other legal theory (including but not limited to any claim of fraud or misrepresentation), based on,
arising out of, or related to this Agreement or the breach thereof shall be settled exclusively according to the procedures set forth in this Article 10; provided, however, that any Party may seek preliminary judicial relief if such remedy is
otherwise available and such Party, in its good faith judgment, considers such action necessary to avoid irreparable damage during the pendency of such procedures. 

  
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 10.2     Negotiation. In the event of a Dispute,
except for equitable relief, prior to invoking the arbitration provisions of Section 10.3 below, the Parties to the Dispute shall attempt in good faith to resolve the Dispute through negotiation, third party intervention, or mediation, for a
period of at least thirty (30) days or, if the disputing Parties agree on mediation, forty-five (45) days after one Party gives notice of the Dispute to any other Party. 

10.3     Arbitration. Except for Disputes which may be resolved by the court in the Condemnation
Action (including the City’s obligation to pay the Growth Premium under Section 2.17), if the Parties have first attempted in good faith to resolve the Dispute pursuant to Section 10.2 and the Dispute remains unresolved for the
applicable period of time under Section 10.2, then the Dispute shall be settled or resolved by arbitration in metropolitan Phoenix, Arizona before a single arbitrator in accordance with the then current Commercial Rules of Arbitration of the
American Arbitration Association. The arbitrator must be approved by the AAA and be mutually acceptable to the arbitrating Parties. If the arbitrating Parties are unable to agree on the arbitrator, then the AAA shall select the arbitrator. The
resolution of the Dispute by the arbitrator shall be final, binding, nonappealable, and shall be fully enforceable by a court of competent jurisdiction under Applicable Law. The arbitrator may award damages to the prevailing Party and may award
reasonable attorneys’ fees and costs to the prevailing Party. The arbitration award shall be in writing and shall include a statement of the reasons for the award. 

ARTICLE 11 

MISCELLANEOUS 

11.1     Time Periods. If the time for the performance of any duty or obligation under this
Agreement expires on a Saturday or Sunday or on a federal or Arizona holiday, the time for performance shall be extended to the next succeeding day that is not a Saturday, Sunday or federal or Arizona legal holiday. 

11.2     Time of the Essence. All dates and times for performance set forth in this Agreement are
of the essence. 
 11.3     Waiver. Except as may be specifically provided elsewhere in this
Agreement, the waiver of a breach of any term or condition of this Agreement may be made only in writing and shall not be deemed to constitute a waiver of a subsequent breach of such term or condition, or a waiver of a breach or subsequent breach of
any other term or condition. 
 11.4     Entire Agreement. This Agreement (including the
Schedules) constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, both written and oral, among the Parties. 

11.5     Amendment. No amendment to or modification of this Agreement shall be effective unless
it is in writing and signed by all of the Parties. 
 11.6     Construction. This Agreement is
the result of negotiations between City and the Global Group, and the terms and provisions hereof shall be interpreted and construed in accordance with their usual and customary meanings. The Parties waive the application of any rule of law that
otherwise would be applicable in connection with the interpretation and construction of this Agreement pursuant to which ambiguous or conflicting terms or provisions 

  
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 should be interpreted or construed against the Party who, or whose attorney, prepared this
Agreement or any earlier draft of the same. The captions or headings of articles, sections or subsections of this Agreement are for purposes of reference only and shall not limit or define the meaning of any provision of this Agreement. Common nouns
and pronouns shall be deemed to refer to the masculine, feminine, neuter, singular and plural, as the identity of the person may in the context require. 

11.7     Severability. If any provision of this Agreement, including any phrase, sentence,
clause, section or subsection is inoperative or unenforceable for any reason, such circumstances shall not have the effect of rendering the provision in question inoperative or unenforceable in any other case or circumstance, or of rendering any
other provision or provisions herein contained invalid, inoperative, or unenforceable to any extent whatsoever. 
 11.8
    Governing Law; Venue. This Agreement shall be governed in all respects, including as to validity, interpretation and enforcement, by the internal laws of the State of Arizona, but without the application of any conflict
of law principles that would require or permit the application of the laws of any other jurisdiction. Except for disputes resolved in accordance with Article 10, any action at law or judicial proceeding instituted by any Party relating to this
Agreement shall be instituted and maintained only in the state or federal courts in Maricopa County, Arizona. 
 11.9
    Binding Effect. Subject to the provisions of Section 11.15 below, this Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. 

11.10   No Third Party Beneficiaries. Except as provided in Article 9 with respect to indemnification of
Indemnified Parties hereunder, nothing in this Agreement shall confer any rights upon any Person other than the Parties and their respective successors, and permitted assigns. 

11.11   Legal Counsel. The Parties acknowledge and agree that (a) the law firm(s) of Gust Rosenfeld
P.L.C. (and Bryan Cave LLP as to condemnation, ACC and related matters and Maguire & Pearce, PLLC as to water, water rights and permits and related matters) has represented only City in connection with the negotiation and preparation of
this Agreement, has not represented any of the Global Group in any manner, and has not been the “lawyer for the deal” and (b) the law firm of Snell & Wilmer L.L.P. (and Roshka DeWulf & Patten, PLC as to condemnation,
ACC and related matters) has represented only the Global Group in connection with the negotiation and preparation of this Agreement, has not represented City in any manner, and has not been the “lawyer for the deal.” 

11.12   Attorneys’ Fees. In the event of any Dispute between or among any of the Parties arising out
of or relating to this Agreement, including any breach, the prevailing Party shall be entitled, in addition to such other relief as may be granted, to recover its costs and expenses, including without limitation, reasonable attorneys’ fees,
expert witness fees and investigators’ fees, all as may be determined by the arbitrator or, if applicable, the court if the matter is litigated. 

  
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 11.13   Notices. Any notice or other communication
required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered to the Party at the address set forth below, (b) deposited in the U.S. first class mail, registered or
certified, return receipt requested, to the address set forth below, or (c) given to a recognized and reputable overnight delivery service, to the address set forth below: 

To City: 
 City of Buckeye

 Attention: City Manager 

530 East Monroe Avenue 

Buckeye, AZ 85326 
 Fax no.:
(623) 349-5951 
 With a copy to: 

City of Buckeye 
 Attention:
Water Resources Director 
 530 East Monroe Avenue 

Buckeye, AZ 85326 
 Fax no.:
(623) 349-6099 
 With a courtesy 

copy to: 
 Scott W. Ruby 

Gust Rosenfeld P.L.C. 
 One
East Washington 
 Suite 1600 

Phoenix, AZ 85004 
 Fax no.:
(602) 257-7422 
 To all or any of 

the Global Group: 
 Global
Water Resources, Inc. 
 Attention: Ron L. Fleming 

21410 N. 19th Avenue, Suite 201 

Phoenix, Arizona 85027 
 Fax
no.: (623) 580-9659 

  
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 With a courtesy 

copy to: 
 Michael M. Donahey 

Snell & Wilmer L.L.P. 
 One Arizona Center 

400 East Van Buren 
 Phoenix, AZ 85004 

Fax no.: (602) 382-6070 
 or at such other
address, and to the attention of such other person or officer, as any Party may designate in writing by notice duly given pursuant to this Section 11.13. Notices shall be deemed received (x) when delivered to the Party, (y) three
(3) Business Days after being placed in the U.S. first class mail, registered or certified, properly addressed, with sufficient postage, or (z) the business day after being given to a recognized overnight delivery service, with the person
giving the notice paying all required charges and instructing the delivery service to deliver on the following business day. If a copy of a notice is also given to a Party’s counsel or other recipient, the provisions above governing the date on
which a notice is deemed to have been received by a Party shall mean and refer to the date on which the Party, and not its counsel or other recipient to which a copy of the notice may be sent, is deemed to have received the notice. Notice to any one
of Global, Valencia or WUGB shall be deemed to be a notice to all of them. 
 11.14   Code
Section 1033. City makes no representations or warranties of any kind or nature whatsoever regarding the applicability or consequences to any of the Global Group with respect to section 1033 of the Internal Revenue Code of 1986, as amended.

 11.15   ARS Section 38-511. The Parties acknowledge and agree that (a) ARS Section 38-511
provides City with the discretion to terminate this Agreement in certain limited circumstances set forth in A.R.S. Section 38-511(a) where persons representing City and “significantly involved in initiating, negotiating, securing, drafting
or creating the” Agreement are or become “an employee or agent of any other party to the [Agreement] in any capacity or a consultant to any other party of the [Agreement] with respect to the subject matter of the” Agreement within
three (3) years of the date of execution. To the Knowledge of each Party, the following persons were significantly involved in initiating, negotiating, securing, drafting or creating this Agreement on behalf of City: (i) the City Mayor who
signed the Agreement and the City Council members who voted on the Agreement; (ii) the following employees of City: Stephen Cleveland; David Nigh; and Larry Price; (iii) Dan V. Jackson of economists.com, a consultant to City; and
(iv) the following attorneys representing City: Scott Ruby; Michael Bate; David Pennartz; Steve Hirsch; and Rita Maguire. Notwithstanding this Section 11.15, in no event will City, or any of the persons listed in this Section 11.15,
or any of the City Indemnitees (as such term is defined in Section 9.1 above) have, at any time, for any reason, or under any circumstances, any liability of any kind or nature whatsoever under this Agreement, any document or instrument
referred to in or in any way related to this Agreement, the transactions contemplated herein, or otherwise, by reason of this Section 11.15 being included in this Agreement, or by reason of, or the exercise by City of any rights or remedies
available to City under, ARS Section 38-511. Global Group acknowledges that a Governmental Authority might 

  
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 find that there are other persons who have been significantly involved in initiating,
negotiating, securing, drafting or creating this Agreement on behalf of City. 
 11.16   Assignment. 

11.16.1            Consent to Certain Assignments. This
Agreement shall not be assignable or otherwise transferable by any Party hereto without the prior written consent of the other Parties hereto, except that: (a) City consents to Condemnation Defendants’ assignment of their rights hereunder
to Global Water or any Affiliate of Global Water in connection with the liquidation of Condemnation Defendants or their merger or consolidation with Global Water or any Affiliate of Global Water; (b) City consents to Condemnation
Defendants’ freely assigning their rights to any and all Growth Premium payments pursuant and subject to Section 2.17; and (c) Condemnation Defendants consent to City’s assignment of its rights hereunder to a municipal property
corporation wholly owned by City which assumes the obligations of City hereunder; provided, however, that no assignment by Condemnation Defendants or by City shall release or discharge the assigning Party from any of its covenants, obligations and
liabilities under this Agreement (including, without limitation, under Article 9 hereof). 

11.16.2            Statement of Status. City agrees, at
any time upon ten (10) days prior request by Condemnation Defendants or Global Water, for the duration of the Growth Period, to execute, acknowledge and deliver to Condemnation Defendants a statement in writing certifying, if true and correct,
that Section 2.17 is in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating the modifications), and the dates to which the Growth Premium payments and any other payments
have been paid in advance, if any, and acknowledging that there are not, to the Knowledge of City, any uncured defaults on the part of the Global Group under this Agreement, or specifying such defaults if any are claimed. Any such statement
delivered pursuant to this paragraph may be conclusively relied upon by any prospective purchaser, lender or assignee of any portion of the Growth Premium payments, or any rights thereto. 

11.17   Joint and Several. Each and every covenant, duty, responsibility, obligation, indemnity, and
liability of the Global Group or any of them under this Agreement, including the Schedules or in any document or instrument delivered by any of the Global Group pursuant to this Agreement is and shall be the joint and several covenants, duties,
responsibilities, obligations, indemnities and liabilities of each and every member of the Global Group. Any payment to any one of Global Water, Valencia or WUGB shall be deemed to be a payment to whichever member of the Global Group such payment is
to be made under this Agreement. 
 11.18   Counterparts. This Agreement may be executed in two or more
counterparts, in original form or by electronic facsimile, each of which shall be deemed to be an original and all of which shall together constitute one and the same Agreement. This Agreement shall not be effective as between or among any Parties
unless and until this Agreement has been so executed by all of the Parties. 
 [All signatures appear on the following page(s).] 

  
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 In witness whereof, each of the Parties has duly executed this Settlement
Agreement for Stipulated Condemnation by its authorized representative as of the date first above written. 
  

									
	CITY:	 		 		 	
				
	CITY OF BUCKEYE,	 		 		 	
	an Arizona municipal corporation	 		 		 	
					
	By:	 	 /s/ Jackie A. Meck
	 		 		 	
		 	Jackie A. Meck, Mayor	 		 		 	
			
	ATTEST:	 		 	APPROVED AS TO FORM:
			
	 /s/ Lucinda J. Aja
	 		 	 /s/ Scott W. Ruby

	Lucinda J. Aja, City Clerk	 		 	Scott W. Ruby
		 		 	Gust Rosenfeld P.L.C.
		 		 	Attorneys for City
			
	GLOBAL GROUP:	 		 	
			
	GLOBAL WATER RESOURCES, INC.,	 		 	GLOBAL WATER, LLC
	a Delaware corporation	 		 	a Delaware limited liability company
					
	By:	 	 /s/ Ron L. Fleming
	 		 	By:	 	 /s/ Ron L. Fleming

		 	Ron L. Fleming, President	 		 		 	Ron L. Fleming, Manager
			
	VALENCIA WATER COMPANY, INC.,	 		 	WEST MARICOPA COMBINE, INC.,
	an Arizona corporation	 		 	an Arizona corporation
					
	By:	 	 /s/ Ron L. Fleming
	 		 	By:	 	 /s/ Ron L. Fleming

		 	Ron L. Fleming, President	 		 		 	Ron L. Fleming, President
				
	WATER UTILITY OF GREATER	 		 		 	
	BUCKEYE, INC., an Arizona corporation	 		 		 	
					
	By:	 	 /s/ Ron L. Fleming
	 		 		 	
		 	Ron L. Fleming, President	 		 		 	

  
 45

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