August 29 Update

To all RCH members:

On behalf of the Board of Directors, I extend our gratitude to you for your enduring patience over the past few months as we've navigated through various challenges. Most notably, as many of you are aware, RCH has accepted an acquisition offer from Aqua Texas (Aqua), pending member approval.

The selection of the ideal operator for our system necessitated a proven track record of reliability and experience within communities of our size and complexity. Our aim is to have an operator well-acquainted with the region and its infrastructure, while also being prepared for impending population growth.

Over the last six months, our utility has overcome significant challenges. To recap:

• In April, our plant operator and management company resigned without notice.
• The Board promptly convened and issued a call for a Request for Proposals (RFP) within 30 days, open to all interested parties.
• Submissions were reviewed by the Board.
• In June, Aqua Texas (Aqua) was chosen to oversee the system and has committed to uphold the existing rates.

Aqua has been overseeing the system since June and is ready to initiate invoice distribution this week. Under Aqua's guidance, RCH has invested in the installation of an automated switch on Pump 3, effectively mitigating unforeseen water supply disruptions. Furthermore, RCH is making investments in new meters to enhance usage and billing accuracy. The Aqua team is also in discussions with the city of Rockwall to secure additional water for RCH, particularly during this period of heightened restrictions. These reasons, among others, instill in us the confidence that Aqua is indeed the most fitting operator for our system.

In our ongoing commitment to transparency, I will release the signed purchase agreement between RCH and Aqua later this week. As we move forward, we recognize that the process is multifaceted and anticipate that our members will have questions and concerns. Both Aqua and RCH will initiate public meetings to discuss the future of RCH. These sessions will furnish information regarding the subsequent stages and the timeline for a member vote on the acquisition. We are steadfast in our commitment to keep you informed at every juncture.

At present, our greatest challenge persists in the form of drought. The importance of water conservation cannot be overstated. I urge you to turn off faucets, refrain from watering lawns, and abstain from washing cars. We will continue to send alerts and keeping you informed through emails and website updates.

Yours sincerely,

David Naylor