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during construction is to be made on the anniversary date of the <br />Project Contract. <br />f. The District and the Enterprise may prepay all or <br />any of the loan at any time, without penalty. Such payments will <br />be applied first to any accrued interest and then to reduce the <br />principal amount. <br />3. The Board hereby authorizes the President and the <br />Secretary of the Board to execute the Project Contract between CWCB <br />and the Board and /or the Enterprise, incorporating the loan amount <br />and payment terms set forth in Paragraphs 1 and 2, above. The <br />Project Contract may also provide that the District and the <br />Enterprise will fix, collect, charge, and pledge rates, fees and <br />other charges sufficient to repay the annual installment amounts <br />due to CWCB under the Project Contract, that the District and <br />Enterprise will execute and deliver, as security for the loan to <br />CWCB, a deed of trust on The Plateau Creek Pipeline and <br />appurtenances thereto (as upgraded and replaced pursuant to the <br />Project), and that the District and Enterprise will place money <br />collected from rates, fees, and other charges each year in a <br />separate reserve escrow account, apart from other District and <br />Enterprise revenues, to assure repaym f the loan to CWCB, and <br />will establish a security interest fu ds in favor of CWCB <br />to secure repayment. The Proje ac also contain any <br />other lawful provisions require CB aN ndition of making <br />the loan to the District and E e, or requested by <br />counsel for the District and the 'se. once the Project <br />Contract is executed by the Pres' t Secretary of the Board, <br />the officers and employees of tl*,' rict shall be authorized to <br />take all actions required of and `po' perform all obligations of the <br />District and the Enterprise, as set forth in the Project Contract. <br />4. The Board finds and determines, pursuant to §37 -45- <br />139(1), C.R.S., that the annual obligation created by the loan from <br />CWCB to the District and /or the Enterprise will not require a <br />greater annual expenditure than the annual income and revenue of <br />the District and Enterprise is estimated to permit, and so an <br />election is not required by statute or under the constitution of <br />the State of Colorado. <br />5. The Enterprise was established by resolution of the Board <br />of Directors of the District dated September 14, 1994. After the <br />Project Contract is fully executed by all parties to it, said <br />resolution shall be irrevocable for the duration of the Project <br />Contract, and the Enterprise shall remain in existence and shall <br />not be terminated prior to full repayment of the loan. <br />- 3 - <br />