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and a Conditional Assignment of Contract Proceeds, attached as Appendix 5 and <br /> • <br /> Appendix 6, respectively, and incorporated herein, to convey a security interest in said <br /> income to the STATE. The BORROWER acknowledges that the STATE shall perfect its <br /> security interest in the BORROWER'S right to receive said income by filing a UCC-1 Form <br /> with the Colorado Secretary of State. ' <br /> 13. Pledge Of Property. The BORROWER hereby irrevoca ledg s4oi ,{ , for purposes <br /> of repayment of this loan revenues from assessments i .unt req ' `-.;.-'•r annual loan <br /> payments as authorized by the BORROWER'S resolutiori, n II "; -, :.RROWER'S rights to <br /> receive said assessment revenues from its stockholders (her_' . ',lI i referred to <br /> as the "pledged property"). Furthermore, BORROWER agrees that <br /> a. Revenues For This Loan Are To Be Kept Separate. The BORROWR hereby agrees <br /> that the pledged revenues shall be set aside and kept in an account separate from other <br /> BORROWER revenues, and warrants that these revenues shall not be ued for any other <br /> purpose. <br /> b. Establish Security Interest. The BORROWER agrees that, in order to rovide a security <br /> interest for the STATE in the pledged property so that the STATE shall ha a priority over all <br /> other competing claims for said property, it shall execute a Security Agreement, attached <br /> hereto as Appendix 7 and incorporated herein prior to the disbursement of any loan <br /> funds, and it shall provide an executed Assignment of Deposit Account as Security in the <br /> form attached as Appendix 8 and incorporated herein at the time the NATE determines <br /> that the PROJECT is substantially completed. The BORROWER acknowledges that the STATE <br /> shall perfect its security interest in the BORROWER'S right to receive assessment revenues <br /> by filing a UCC-1 Form with the Colorado Secretary of State. <br /> c. Assessments For Repayment Of The Loan. Pursuant to its statutory authority, articles <br /> of incorporation and by-laws, and as authorized by its resolution, the BORROWER shall <br /> take all necessary actions consistent therewith to levy assessments su cient to pay this <br /> loan as required by the terms of this contract and the promissory note. In the event the <br /> assessments levied by the BORROWER become insufficient to assure sich repayment to <br /> the STATE, the BORROWER shall immediately take all necessary action Consistent with its <br /> statutory authority, its articles of incorporation, bylaws and resolutions, ncluding, but not <br /> limited to, levying additional assessments to raise sufficient revenue to ssure repayment <br /> of the loan to the STATE. <br /> d. Assessments For Operations, Maintenance And Reserves. Pursue t to its statutory <br /> authority, articles of incorporation, by-laws, and resolutions, the BOR OWER shall levy <br /> assessments from time to time as necessary to provide sufficient fu ds for adequate <br /> operation and maintenance, emergency repair services, obsolescence serves and debt <br /> service reserves. BORROWER shall deposit an amount equal to one-t 'nth of an annual <br /> payment into its debt service reserve fund on an annual basis for the fi ten years of this <br /> loan. <br /> 14. Collateral During Repayment. The BORROWER shall not sell, cony , assign, grant, <br /> transfer, mortgage, pledge, encumber, or otherwise dispose of any of the property provided <br /> as security for this loan, including the assessment revenues pledged herein to repay the <br /> The Agricultural Ditch and Reservoir Company Page 7 of 14 Loan Contract <br />