PROJ01899

• Contract/PO #: C153686
• Contractor Name: Red Mesa Ward Reservoir and Ditch Company
• Contract Type: Grant
• Water District: 0
• Bill Number: HB 95-1155
• Loan Projects - Doc Type: Contract Documents

LOAN CONTRACT
Red Mesa Ward
Reservoir and Ditch Co.
Feasibility Study

financially feasible in accordance with the conclusions of the fmal Feasibility Report, or if
The Project is built. It is further understood that the entire principal amount borrowed under
this contract may be repaid by the Borrower as part of the Construction Fund Loan for The
Project, provided that construction of The Project commences within five (5) years of the
date of this contract. Since it is not currently known if The Project is feasible or if it will
be built, all terms and conditions of repayment, if any, will be specified in a future contract
between the Borrower and the State, which the Borrower hereby agrees to enter into, under
terms and conditions agreeable to the State and to the Borrower.

6b.. (Loan will be Forgiven if the Project is NOT Feasible and is not built): If the
Consultant's conclusions in the fmal report of the Feasibility Study fmd that the Project is
NOT feasible and if The Project is not built, then the Board will release the Borrower from
any obligation to repay this loan and will forgive this debt. 9

6c. (Not Sell or Convey any Collateral until the Loan id of Forgiven):
The Borrower shall not sell, convey, assign, grant, transfer, mortgag , pledge, encumber, or
otherwise dispose of the collateral for this loan. ' or any G;rtion thereof, so long as any of the
principal remains unpaid, or until such time as the loan een forgiven, without the prior
written concurrence of the State.

7. (DEED OF TRUST PROVISIONS): 0

7a. (Security for the Loan): As security loan to be made to it by the State,
the Borrower has executed a deed of trust as shown in Appendix C. The security provided
therein shall be an nndivided one h~nt (100%) interest in the following:

The water rights for Red Mes eservoir & Ditch Company consiting of
2,898.28 acre-feet CONDffiONAL, date of original decree: 3/21/66; Case No.:
807-C (W-53 and W-669); Priority No. 1965-1; Priority Date: 4/30/1905.

7b. (Upon Default by the Borrower, the State has these Options): Upon default in
the performance of any covenant or agreement contained herein, the State, at its option,
may: (a) declare the entire principal amount then outstanding immediately due and payable;
(b) for the account of the Borrower, incur and pay reasonable expenses as may be necessary
to cure the cause of default; (c) act upon the security (described in Appendix C); (d) take
action to enforce paragraph 6a.; and/or (e) take any other appropriate legal action. All
remedies described herein may be simultaneously or selectively and successively enforced.

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