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(d) All assets and property of the Corporation, whether owned or leased, will be transferred
to the Agency pursuant to one or more bills of sale, assignments or quitclaim deeds, as reasonably determined
by Agency counsel. Furthermore, all water rights, easements and rights of way that are utilized by the
Corporation to deliver water service through the water distribution system owned and operated by the
Corporation will be assigned and/or deeded to Agency.

(e) All accounts, cash receipts and accounts receivable of the Corporation will be
transferred to Agency, provided, however, that Agency will agree to apply all payments and credits received
prior to dissolution to the accounts of Corporation’s customers.

(f) All books and records, software programs, data backups and other documentation of
any kind which is in the possession of the Corporation will be transferred to Agency.

(g) The Corporation and Agency will jointly prepare a letter to the customers of the
corporation informing them of the transition of service to the Agency and any changes in billing and customer
service.

3. Dissolution of Corporation. After the Plan has become effective and the distribution of assets
and liabilities of the Corporation has been completed pursuant to Section 2, the Board of Directors and officers
shall take all steps which they may deem to be necessary or desirable to accomplish the final dissolution of the
Company, including, but not limited to:

(a) providing for tail insurance coverage for the Corporation and its Directors and Officers;

(b) providing adequate reserves to pay all professional fees and expenses in connection
with the dissolution, as well as any debts or liabilities that Corporation and Agency
determine will be paid by the Corporation prior to dissolution;

(c) the filing of final tax returns and any regulatory or securities filings that are necessary
in connection with the dissolution, provided, however, that the Agency may agree to
assume the obligation to prepare and file all final tax returns of the Corporation, as well
as all liability for taxes of any kind that are due and payable by the Corporation (except
to the extent that any such tax liability on dissolution has been allocated pursuant to a
prior agreement between Castaic Lake Water Agency, the predecessor in interest to
Agency, and any prior shareholder of the Corporation); and

(d) all other steps necessary to wind up and dissolve the Corporation in accordance with the
provisions of the corporate laws of the State of California.

4. Authorization of Necessary Acts. The Directors of the Company, acting by and through the
General Manager of the Corporation, Kenneth J. Petersen, and as necessary, the three person committee of the
Board appointed to oversee the implementation of this Plan, shall carry out and consummate the Plan and shall
have power to adopt all resolutions, execute all documents, incur and pay all expenses, file all papers (including
without limitation a certificate of dissolution with the Secretary of State of the State of California) and take all
other actions that they may deem necessary or desirable for the purpose of effecting the dissolution of the
Company and the complete liquidation of its business, assets, and affairs.

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