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at the address given below. e. Interest during study period. The BORROWER shall repay to the STATE interest which will be calculated monthly at an equivalent rate of four percent (4%) per annum on each loan advance disbursed to the BORROWER during the time the feasibility study is being prepared. Said accumulated interest shall be paid to the STATE as a single lump sum on the first day of the month following the month that the STATE accepts the feasibility study. The actual interest which will accumulate is unknown and cannot be calculated until the conclusion of the feasibility study. f. Prepayment conditions. The BORROWER may prepay all or any of the loan at any time, without penalty. These payments will be applied first to any accrued interest and then to reduce the principal amount. g. Collection costs. If the principal or interest thereon is not paid when due, the BORROWER agrees to pay all reasonable costs of collection, including reasonable attorney fees. In the event of any bankruptcy or similar proceedings, costs of collection shall include all costs and attorney fees incurred in connection with such proceedings, including the fees of counsel for attendance at meetings of creditors' or other committees. 6. Security for loan. Part of the security provided for this loan shall be a certificate of deposit (CD) in the amount of $3,000 (SECURITY) in t"e name of "Arkansas Groundwater Users Association and/or State of Colorado Water ConservationlJoard." BORROWER shall provide the CD to STATE before any funds are advanced. The STATE shall give physical custody of the CD to the State Treasurer's Office for safekeeping. The BORROWER understands that in the event of default in the repayment of this 10~QI,tt1e,SI"rglT1.~y..,e~ .s,;.;9J,th~.rerJ")edieslisted below including taking possession of the CD.f '-r:atetestfa~c:f!t!q{U2 "t.", . \~!n:gQ,fe;<to the benef~t.~'~B,Q~~g,we~;t1 7. Security during loan'repayment. The BORROWER shall not convey, assign, grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the SECURITY or any portion thereof or the assessment revenues pledged herein to repay the loan so long as any of the principal and any accrued interest required by the "Promissory Note Provisions remain unpaid, without the prior written concurrence of the STATE: 8. Remedies for default. Upon default in the payments herein set forth to be made by the BORROWER, or default in the performance of any covenant or agreement contained herein, the STATE, at its option, may: a. declare all outstanding principal and accrued interest immediately due and payable; b. act upon its security interests and the promissory note; and/or c. take possession of the CD and utilize the funds for repayment of the loan; and/or c. take any other appropriate action. All remedies described herein may be simultaneously or selectively and successively enforced. The provisions of this contract may be enforced by the STATE at its option without regard to prior waivers by it of previous defaults by the BORROWER, through judicial proceedings to require specific performance of this contract, or by such other proceedings in law or equity as may be deemed necessary by the STATE to ensure compliance with provisions of this contract and the laws and regulations under which this contract is executed. The STATE'S exercise of any or all of the remedies described herein shall not relieve the ARKANSAS GROUNDWATER USERS ASSOCIATION Page 3 of 8 Pages FEASIBILITY REPORT CONTRACT