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10. Pledge of Property. The BORROWER irrevocably pledges to the CWCB, for purposes of
<br /> repayment of this loan, an interest in the PLEDGED PROPERTY. The PLEDGED PROPERTY as further
<br /> described in Section 6 (LoAN SECURITY) of the PROJECT SUMMARY is authorized by the
<br /> BORROWER'S AUTHORIZING RESOLUTION, and secured by the DEED OF TRUST(APPENDIX 6).
<br /> ii. Pledged Property during Loan Repayment. The BORROWER shall not sell, convey, assign,
<br /> grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the PLEDGED PROPERTY
<br /> so long as any of the principal, accrued interest, and late charges, if any, on this loan remain
<br /> unpaid, without the prior written concurrence of the CWCB. In the event of any such sale,
<br /> transfer or encumbrance without the CWCB's written concurrence, the CWCB may at any
<br /> time thereafter declare all outstanding principal, interest, and late charges, if any, on this
<br /> loan immediately due and payable.
<br /> 12. 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 NOTE,
<br /> the CWCB agrees to release and terminate any and all of the CWCB's right, title, and interest
<br /> in and to the PLEDGED REVENUES and the PLEDGED PROPERTY.
<br /> 13. Warranties.
<br /> a. The BORROWER warrants that, by acceptance of the loan under this CONTRACT and by its
<br /> representations herein, the BORROWER shall be estopped from asserting for any reason
<br /> that it is not authorized or obligated to repay the loan to the CWCB as required by this
<br /> CONTRACT.
<br /> b. The BORROWER warrants that it has not employed or retained any company or person,
<br /> other than a bona fide employee working solely for the BORROWER, to solicit or secure this
<br /> CONTRACT and has not paid or agreed to pay any person, company, corporation,
<br /> individual, or firm, other than a bona fide employee, any fee, commission, percentage,
<br /> gift, or other consideration contingent upon or resulting from the award or the making of
<br /> this CONTRACT.
<br /> c. The BORROWER warrants that the PLEDGED REVENUES and PLEDGED PROPERTY for this loan
<br /> are not encumbered by any other deeds of trust or liens of any party other than the
<br /> CWCB or in any other manner, except for any existing lien(s) identified in APPENDIX 1,
<br /> PROJECT SUMMARY, SECTION 5, SCHEDULE OF EXISTING DEBT, which sets forth the position of
<br /> the lien created by this CONTRACT in relation to any existing lien(s). Documentation
<br /> establishing the relative priorities of said liens, if necessary, is attached to the PROJECT
<br /> SUMMARY and incorporated herein.
<br /> 14. Change of Ownership of Water Shares during Term of Contract. If the interest rate
<br /> for this loan is based on the CWCB's agricultural or blended agricultural and municipal
<br /> and/or commercial and/or industrial rates, the BORROWER agrees to notify the CWCB of
<br /> any change of the ownership of the water rights represented by its shares from irrigation
<br /> to municipal or commercial or industrial use. The interest rate shall be revised when said
<br /> change in ownership would increase the original interest rate by o.5% or more. The
<br /> parties shall amend this CONTRACT including a revised PROMISSORY NOTE, to effect said
<br /> change in interest rate.
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