Standstill Agreement, dated December 21, 2017, by and among Global Water Resources, Inc., Levine Investments Limited Partnerships, William S. Levine, and Andrew M. Cohn

This STANDSTILL AGREEMENT (this “Agreement”) is made as of December 21, 2017, by and among Global Water Resources, Inc., a Delaware corporation (the “Company”), Levine Investments Limited Partnership, an Arizona limited partnership (the “Partnership”), William S. Levine and Andrew M. Cohn, together with their Affiliates (as defined below).

WHEREAS, William S. Levine is the chairman of Keim, Inc., an Arizona corporation (“Keim”), which is the general partner of the Partnership; and

WHEREAS, the Partnership intends to consummate a stock purchase transaction to acquire 2,826,615 shares of the Company’s common stock, par value $0.01 per share (“Common Stock”), from certain shareholders of the Company; and

WHEREAS, Andrew M. Cohn intends to consummate a stock purchase transaction to acquire 193,385 shares of the Common Stock from certain shareholders of the Company; and

WHEREAS, the Company is an existing, approved public utility holding company subject to the rules and regulations of the Arizona Corporation Commission (the “ACC”); and

WHEREAS, the ACC rules require that a transaction that results in an organization of a public utility holding company or a reorganization of an existing, approved public utility holding company, in each case be subject to the approval by the ACC; and

WHEREAS, the Company desires to enter into this Agreement in order to (i) satisfy itself that following the consummation of the transactions described above, no Shareholder (as defined below) or Shareholders acting as a group “control” the Company under the ACC rules and (ii) obtain contractual assurances from the Shareholders that they will refrain from future actions that could result in one or more of them acquiring “control” of the Company under the ACC rules; and

WHEREAS, in order to secure the Company’s cooperation with the transactions described above, the Shareholders have agreed to enter into this Agreement.

NOW, THEREFORE, in consideration of the promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1.Definitions. For purposes of this Agreement, the following terms have the following meanings:

“ACC” shall have the meaning set forth in the recitals.

“Agreement” shall have the meaning set forth in the preamble.

“Affiliate” means, with respect to any Person, any other Person that is directly or indirectly Controlling, Controlled by, or under common Control with such Person.

“Common Stock” shall have the meaning set forth in the recitals.

“Company” shall have the meaning set forth in the preamble.

“Control” and derivative terms mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or management policies of a Person, whether through the ownership of voting securities, by contract, or otherwise.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Parties” mean the parties to this Agreement.

“Partnership” shall have the meaning set forth in the preamble.

“Person” means any individual, corporation, limited or general partnership, limited liability company, limited liability partnership, trust, association, joint venture, governmental entity, or other entity.

“Shareholders” means the Partnership, William S. Levine, Andrew M. Cohn, and their Affiliates, collectively.

“Term” shall have the meaning set forth in Section 6.

2.Standstill Provision. During the Term, the Shareholders agree that neither the Shareholders nor their Affiliates will directly or indirectly, without the prior written consent of Ron Fleming as CEO of the Company or his replacement (i) acquire, agree to acquire, or make any proposal to acquire, equity securities (including convertible debt instruments and preferred stock or any shares of capital stock issuable upon the conversion or exercise thereof) of the Company, or (ii) in any way participate in a “group” (within the meaning of Section 13(d)(3) of the Exchange Act) in connection with the ownership, voting or acquisition of any equity security of the Company. Notwithstanding the foregoing, a Shareholder who is a member of the Board of Directors of the Company may receive equity compensation in payment for his board service provided that after such payment, such Shareholder and his Affiliates beneficially own no more than 49.9%, in the aggregate, of the voting power of all voting securities of the Company. In the event that after such payment the Shareholder or Affiliates would own more than 49.9%, in the aggregate, of the voting power of all voting securities of the Company, such equity compensation shall be replaced with a cash payment of equivalent value to the Shareholder and Affiliates as applicable.

3.Shareholder Representations. Each of the Shareholders represents and warrants as follows as to itself except as otherwise stated:

4.Company Representations. The Company represents and warrants as follows:

5.Shareholder Covenants.

6.Termination. The term (“Term”) of this Agreement shall commence from the date of this Agreement through the date that the Shareholders (together with their Affiliates) no longer beneficially own Common Stock (including shares underlying options or warrants) representing, on a fully diluted basis, in the aggregate, at least 20% of the Company’s outstanding Common Stock; provided, however, that this Agreement may be terminated or amended at any time by the mutual written consent of the Parties, including the prior written consent of a disinterested majority of the Board of Directors of the Company; provided, further, that this Agreement may be terminated by any Party (a) if the stock purchase transactions refered to in the recitals are not closed on or before January 10, 2018 or (b) following six (6) months written notice to the other Parties delivered at any time after July 1, 2020.

7.Remedies.

8.Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement. Executed counterparts of this Agreement may be delivered by facsimile or by e‑mail as PDF attachments with the same force and effect as an original.

9.Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Arizona.

10.Successors and Assigns. Neither this Agreement nor any of the rights or obligations of any Party shall be assigned, in whole or in part by any party without the prior written consent of the other Parties.