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� <br />Property." <br />�� <br />a. Segregation of Pledged Revenues. The BoRROwER shall .set aside and keep the <br />pledged revenues in an account separate from other BoRROwER revenues, and <br />warrants that these revenues will not be used for any other purpose. <br />b. Establish Security Interest. The BORROWER has duly executed a Security <br />Agreement, attached hereto as Appendix 4 and incorporated herein, to provide a <br />security interest to the CWCB in the Pledged Property. The CWCB shall have <br />priority over all other competing claims for said Pledged Property, except for the <br />liens of the BORROwER existing loans as listed in Section 5(Schedule of Existing <br />Debt) of the Project Summary, which sets forth the position of the lien created by <br />this contract in relation to any pre-existing lien(s). <br />c. Revenue Assessments. Pursuant to its statutory authority, articles of incorporation <br />and bylaws, the BoRROwER shall take all necessary actions consistent therewith <br />during the term of this contract to levy assessments sufficient to pay this loan as <br />required by the terms of this contract and the Promissory Note, to cover all <br />expenditures for operation and maintenance and emergency repair services, and to <br />maintain adequate debt service reserves. In the event the assessments levied by <br />the BoRROwER become insufficient to assure such repayment to the CWCB, the <br />BoRROwER shall immediately take all necessary action consistent with its statutory <br />authority, its articles of incorporation and bylaws including, but not limited to, levying <br />additional assessments to raise sufficient revenue to assure repayment of this loan. <br />d. Debt Service Reserve Account. To establish and maintain the debt service <br />reserve account, the BoRROwER shall deposit an amount equal to one-tenth of an <br />annual payment into its debt service reserve fund on the due date of its first annual <br />loan payment and annually thereafter for the first ten years of repayment of this <br />loan. In the event that the BORROWER applies funds from this account to <br />repayment of the loan the BORROwER shall replenish the account within ninety <br />(90) days of withdrawal of the funds. <br />8. Collateral. The collateral for this loan is described in Section 6(Collateral) of the <br />Project Summary, and secured by the instrument(s) attached hereto as Appendix 5 <br />and incorporated herein. <br />a. The BoRROwER shall not sell, convey, assign, grant, transfer, mortgage, pledge, <br />encumber, or otherwise dispose of the collateral for this loan, including the <br />Pledged Property, so long as any of the principal, accrued interest, and late <br />charges, if any, on this loan remain unpaid, without the prior written concurrence <br />of the CWCB. In the event of any such sale, transfer or encumbrance without <br />the CWCB's written concurrence, the CWCB may at any time thereafter declare <br />all outstanding principal, interest, and late charges, if any, on this loan <br />immediately due and payable. <br />9. Release After Loan Is Repaid. Upon complete repayment to the CWCB of the entire <br />principal, all accrued interest, and late charges, if any, as specified in the Promissory <br />Note, the CWCB agrees to release and terminate any and all of the CWCB's right, title, <br />and interest in and to the collateral and the property pledged to repay this loan. <br />Page3of9 <br />