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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
<br />annual loan payment and annually thereafter for the first ten years of repayment
<br />of this 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 />9. 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 />10. Collateral During Loan Repayment. The BORROWER shall not sell, convey, assign,
<br />grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the Collateral or
<br />the 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 of
<br />the CWCB. In the event of any such sale, transfer or encumbrance without the
<br />CWCB's written concurrence, the CWCB may at any time thereafter declare all
<br />outstanding principal, interest, and late charges, if any, on this loan immediately due
<br />and payable.
<br />11. Release After Loan Is Repaid. Upon complete repayment to the CWCB of the
<br />entire principal, all accrued interest, and late charges, if any, as specified in the
<br />Promissory Note, the CWCB agrees to release and terminate any and all of the
<br />CWCB's right, title, and interest in and to the Collateral and the Pledged Property.
<br />12. Warranties.
<br />a. The BORROWER warrants that, by acceptance of the loan under this contract and
<br />by its representations herein, the BORROWER shall be estopped from asserting
<br />for any reason that it is not authorized or obligated to repay the loan to the
<br />CWCB as required by this contract.
<br />b. The BORROWER warrants that it has not employed or retained any company or
<br />person, other than a bona fide employee working solely for the BORROWER, to
<br />solicit or secure this contract and has not paid or agreed to pay any person,
<br />company, corporation, individual, or firm, other than a bona fide employee, any
<br />fee, commission, percentage, gift, or other consideration contingent upon or
<br />resulting from the award or the making of this contract.
<br />c. The BORROWER warrants that the Pledged Property and Collateral for this loan
<br />are not encumbered by any other deeds of trust or liens of any party other than
<br />the CWCB or in any other manner, except for any existing liens) identified in
<br />Section 5 (Schedule of Existing Debt) of the Project Summary, which sets forth
<br />the position of the lien created by this contract in relation to any existing lien(s).
<br />Documentation establishing the relative priorities of said liens, if necessary, is
<br />attached to the Project Summary and incorporated herein.
<br />13. Change of Ownership of Water Shares During Tenn of Contract. If the interest
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