C150049 Contract

• Contract/PO #: C150049
• Contractor Name: People's Ditch Company
• Contract Type: Loan
• County: Logan
• Loan Projects - Doc Type: Contract Documents

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c. To place the assessment revenues pledged to make annual loan payments in a special
account separate and apart from other BORROWER revenues in accordance with the Pledge of
Property Provisions of this contract and
d. To make annual payments in accordance with the promissory note, and
e. To make annual deposits to a debt service reserve fund in accordance with the Pledge of
Property Provisions of this contract, and
f. To obtain a certificate of deposit to serve as collateral in the amount of one annual loan
payment as security for the loan, and execute an assignment of certificate of deposit as
described in the Collateral Provisions of this contract, and
g. To execute a Security Agreement and an Assignment of Deposit Account as Security to
secure the revenues pledged herein in accordance with the Pledge of Property Provisions of
this contract.
Said resolutions are attached hereto as Appendix 1 and incorporated herein.
8. Attorney's Opinion Letter. Prior to the execution of this contract by the STATE, the BORROWER
shall submit to the STATE a letter from its attorney stating that it is the attorney's opinion that the
person signing for the BORROWER was duly elected or appointed and has authority to sign such
documents on behalf of the BORROWER and to bind the BORROWER; that the BORROWER'S
shareholders and board of directors have validly adopted resolutions approving this contract; that
there are no provisions in the BORROWER'S articles of incorporation or bylaws or any state or
local law that prevent this contract from binding the BORROWER; and that the contract will be valid
and binding against the BORROWER if entered into by the STATE.
9. Promissory Note Provisions. The Promissory Note setting forth the terms of repayment and
evidencing this loan in an amount up to $43,000 at an interest rate of 3.75% per annum for a term
of 20 years is attached as Appendix 2 and incorporated herein.
a. Interest During Construction. As the loan funds are disbursed by the STATE to the
BORROWER during construction, interest shall accrue at the rate of 3.75%. The STATE shall
calculate the amount of the interest accrued during construction and the BORROWER shall
repay that amount to the STATE either within ten (10) days after the date the STATE
determines that the PROJECT has been substantially completed, or, at the STATE'S discretion,
said interest shall be deducted from the final disbursement of loan funds that the STATE
makes to the BORROWER.
b. Final loan amount. In the event that the final loan amount is at least 90% of the
AUTHORIZED LOAN AMOUNT, the STATE shall apply the remaining loan funds to prepayment
of the loan, which will result in the annual loan payment remaining the same, and the time
for repayment of the loan will be reduced. If the final loan amount is less than 90% of the
AUTHORIZED LOAN AMOUNT, the STATE may apply those funds to prepayment of the loan
with the BORROWER'S consent, or the State and the BORROWER shall execute an
amendment that will establish the final loan amount and amend or replace the loan
documents that reflect the final loan amount, including the Promissory Note, Security
Agreement, Assignment of Deposit Account as Security, and Assignment of Certificate of
Deposit.
10. Warranties.
a. The BORROWER warrants that, by acceptance of the loan money pursuant to the terms of this
contract and by the BORROWER'S representation herein, the BORROWER shall be estopped
from asserting for any reason that it is not authorized or obligated to repay the loan money to
the STATE as required by this contract.
b. The BORROWER warrants that it has full power and authority to enter into this contract. The