PROJ01923 ‎(2)‎

• Contract/PO #: C150126
• Contractor Name: Kremmling, Town of
• Contract Type: Loan
• Water District: 50
• County: Grand
• Loan Projects - Doc Type: Contract Documents

'. tolls and charges for services ,furnished by or the use of the System as required in provision,
A(8)(c) of the Loan Contract. In the event that the Gross Revenue at anytime is not sufficient to
make the payments required by said provision, the Town covenants to promptly increase such
rates, fees, plant investment fees, availability fees, tolls and charges to an extent whi(:hwill
ensure compliance with said covenant.

Section 10. Additional Covenants and Agreements. The Town hereby further
irrevocably covenants and agrees with CWCB that so long as the Promissory Note n~mains
outstanding:

(a) Maintenance of Records and Accounts., The Town shall keep proper
books of record and accounts showing complete and correct entries of all transactions
relating to the funds and accounts referred to herein and in such manner that the Gross
Revenue and the Net Revenue may' at all times be readily and accurately determined.

(b) Alienation of Property. , The Town will riot sell or alienate any of the
property constituting any part or all of the System in any manner or to any extent as .
might reduce the security provided for the payment of the Promissory Note, but th(;~ Town
may sell' any portion of such property which shall have been repl~ced by other similar
property of at least equal "alue, or which shall cease to be necessary for the e:fficient
operation of the System; provided however, that the proceeds of any such sale of pmperty
shall be included as part of the Gross Revenue.

(c) Payment for Services. The Town will promptly render,bills for services
furnished by or the use of the System, shall use all' legal means to assure prompt payment
thereof, shall take such action as may be necessary to make delinquent rates, fees, tolls
and ,charges of the System a lien, upon the real property, served, and to, the extent
permitted by law, shall discontinue service to any user who becomes delinquent: 'in the
payment of such charges until the delinquency and all interest, costs and expenses
incident thereto have been paid in full. '

(d) Audits. At least once a year in the time and manner provided by law, the
Town will cause an 'audit to be performed of the records relating to the revenues and
expenditures of the System. Such audit may be made part of and included within the
general audit of the Town, and made at the same time as the general audit. In addition, at
least once a year in the time and manner provided by law, the Town will cause a budget
to be prepared and adopted. Copies of the budget and the audit will he filed and r(~corded
in the places, time and manner provided by law. ,The Town covenants to submit a copy
of the annual audit and certificate of debt service coverage to th~ CWCB as provided in
provision A(8)(f) of the Loan Contract,

(e) Enterprise Status. The Town has established, and covenants to continue
to maintain, the System as an "enterprise" within the meaning of Article X, Section 20 of
the Colorado Constitution, and as a "water activity enterprise" within the meaning of
Title 37, Article 45.1, C.R.S.; provided, however, after calendar year 2002 the Tmvn may
disqualify either the System as an "enterprise" in any year in which said disqualification
does not materially, adversely affect the enforceability of the covenants made pursuant to

02-178969,2

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