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<br /> PROMISSORY NOTE
<br /> Principal Amount: $100,000 Interest Rate: 3 3/%
<br /> Term: 30 Years Loan Payment: $5,608.76
<br /> Loan Contract: #C153748 Date: March 24, 1997
<br /> 1. FOR VALUE RECEIVED, the Excelsior Irrigating Company("BORROWER")and C. R. Evans ("COSIGNER")promise
<br /> to pay the State of Colorado Water Conservation Board ("STATE"), the principal sum of $100,000 with annual
<br /> payments of$5,608.76 based on the interest rate of 33/4% per annum on the outstanding principal balance for a
<br /> term of 30 years, or until paid in full, pursuant to Loan Contract#C153748("LOAN CONTRACT").
<br /> 2. The first installment shall be due one year from the date the STATE determines that the PROJECT described in the
<br /> LOAN CONTRACT has been substantially completed, and annually thereafter until the entire principal sum and any
<br /> accrued interest shall have been paid in full.
<br /> 3. All payments received shall be applied first to accrued interest and then to the retirement of the principal.
<br /> Payments shall be made payable to the Colorado Water Conservation Board and mailed to 1313 Sherman
<br /> Street, Room 721, Denver, Colorado 80203.
<br /> 4. This Note may be prepaid in whole or in part at any time without premium or penalty, with prepayments applied
<br /> first to any accrued interest and then to reduce the principal amount. Any partial prepayment shall not postpone
<br /> the due date of any subsequent payments or change the amount of such payments.
<br /> 5. This Note is issued pursuant to the LOAN CONTRACT between the STATE and the BORROWER. The LOAN
<br /> CONTRACT creates security interests in favor of the STATE to secure the prompt payment of all amounts which
<br /> may become due hereunder. The security interests, evidenced by the following documents:
<br /> a. Security Agreement dated March 24, 1997, securing BORROWER and COSIGNER'S revenues from lease of
<br /> water;
<br /> b. Security Agreement dated March 24, 1997, securing BORROWER'S pledge of revenues;
<br /> c. Security Agreement dated March 24, 1997, securing COSIGNER'S 2,883 shares of stock,
<br /> d. Deed of Trust dated March 24, 1997, securing COSIGNER'S 2,883 shares of stock;
<br /> e. Deed of Trust dated March 24, 1997, securing the BORROWER'S diversion structure;
<br /> f. Assignment of Contract Proceeds dated March 24, 1997, securing BORROWER and COSIGNER'S revenues
<br /> from lease of water;
<br /> cover certain revenues and real property of the BORROW d ert ' ar of stock of the COSIGNER The
<br /> LOAN CONTRACT, Security Agreements, Deeds of Trust, a:'T) '' m t, ra additional rights to the STATE,
<br /> including the right to accelerate the maturity of this Note in c�' ai t,
<br /> 6. If any payment of principal or interest is not paid promptly ween ue or any default under the LOAN CONTRACT or
<br /> the security agreements or deeds of trust, or assignment sli
<br /> ecurin: ,is ► • - ur- e STATE may declare the
<br /> entire outstanding principal balance of the Note, anc ll ed t' `, i , diat'�. due and payable, without
<br /> notice or demand, and the indebtedness shall bear in r he t - ok`:% • w, <-:m the date of default.
<br /> 7. The BORROWER, any guarantor, and any other pe oo I now` r may hereafter become primarily or
<br /> secondarily liable for the payment of this Note or any portion thereof hereby agree that if this Note or interest
<br /> thereon is not paid when due or suit is brought, then it shall pay all reasonable costs of collection, including
<br /> reasonable attorney fees. In the event of any bankruptcy or similar proceedings, costs of collection shall include
<br /> all costs and attorney fees incurred in connection with such proceedings, including the fees of counsel for
<br /> attendance at meetings of creditors'committees or other committees.
<br /> 8. This Note shall be governed in all respects by the laws of the State of Colorado.
<br /> BORROWER: THE/E� lXCEpLSIOR IRRIGATING COMPANY
<br /> By L).
<br /> Attest: C. R. Evans, President
<br /> • G(-L
<br /> By: LL�c.tiC, 4uc11Y'
<br /> Erin Evans, Secretary
<br /> COSIGNER: C. R. EVANS
<br /> Appendix B to Loan Contract #C153748
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