C150125 Contract

• Contract/PO #: C150125
• Contractor Name: Surface Creek Ditch & Reservoir Company
• Contract Type: Loan
• Water District: 40
• County: Delta
• Bill Number: MC3
• Loan Projects - Doc Type: Contract Documents

gift, or other consideration contingent upon or resulting from the award or the making of
this contract.

c. The BORROWER warrants that the Pledged Property and collateral for this loan are not
encumbered by any other deeds of trust or liens of any party other than the CWCB or
in any other manner, except for any pre-existing Iien(s) identified in Section 5 (Schedule
of Existing Debt) of the Project Summary, which sets forth the position of the lien
created by this contract in relation to any pre-existing Iien(s). Documentation
establishing the relative priorities of said liens, if necessary, is attached to the Project
Summary and incorporated herein.

11. Change of Ownership of Water Shares During Term of Contract. If the interest rate
for this loan is based on the CWCB's agricultural or blended agricultural and municipal
and/or commercial and/or industrial rates, the BORROWER agrees to notify the CWCB of
any change of the ownership of the water rights represented by its shares from irrigation
to municipal or commercial or industrial use. The interest rate shall be revised when said
change in ownership would increase the original interest rate by 0.5% or more. The
parties shall amend this contract, including a revised promissory note, to effect said
change in interest rate.

12. Remedies For Default. Upon default in the payments to be made by the BORROWER under
this contract, or default in the performance of any covenant or agreement contained herein,
the CWCB, at its option, may:

a. suspend this contract and withhold further loan disbursements pending corrective action
by the BORROWER, and if the BORROWER does not cure the default as provided for below,
permanently cease loan disbursements and deem the PROJECT substantially complete;

b. declare the entire principal amount, accrued interest, and late charges, if any, then
outstanding immediately due and payable;

c. exercise its rights under any appendices to this contract, including, but not limited to, the
Promissory Note, Security Agreement, and/or any instrument securing collateral; and/or

d. take any other appropriate action.

The CWCB shall provide written notice to the BORROWER of any such default and shall give
the BORROWER an opportunity to cure within thirty (30) days of receipt of such notice. All
remedies described herein may be simultaneously or selectively and successively
enforced. The CWCB may enforce the provisions of this contract at its option without
regard to prior waivers 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 CWCB to ensure compliance with provisions
of this contract and the laws and regulations under which this contract is executed. The
CWCB's exercise of any or all of the remedies described herein shall not relieve the
BORROWER of any of its duties and obligations under this contract.

11. BORROWER'S Indemnification Of The eWCB. The BORROWER agrees to indemnify and
hold the CWCB harmless from any liability incurred by the CWCB as a result of the
CWCB's interest in the PROJECT facilities and any other property identified in Section 6
(Collateral) of the Project Summary.

12. Operation of PROJECT. The BORROWER shall, without expense or legal liability to the
CWCB, manage, operate, and maintain the PROJECT continuously in an efficient and

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