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9. That the DEBTOR will not use the COLLATERAL in violation of any applicable statutes, regulations or ordinances. <br /> 10. The DEBTOR will keep the COLLATERAL at all times insured against risks of loss or damage by fire (including so-called <br /> extended coverage),theft and such other casualties as the SECURED PARTY may reasonably require, including collision in the case <br /> of any motor vehicle, all in such amounts, under such forms of policies, upon such terms, for such periods, and written by such <br /> companies or underwriters as the SECURED PARTY may approve, losses in all cases to be payable to the SECURED PARTY and the <br /> DEBTOR.as their interest may appear. All policies of insurance shall provide for at least ten days'prior written notice of cancellation <br /> Lo the SECURED PARTY; and the DEBTOR shall furnish the SECURED PARTY with certificates of such insurance or other evidence <br /> satisfactory to the SECURED PARTY as to compliance with the provisions of this paragraph. The SECURED PARTY may act as attorney <br /> for the DEBTOR in making,adjusting and settling claims under or canceling such insurance and endorsing the DEBTOR'S name on any <br /> drafts drawn by insurers of the COLLATERAL. <br /> UNTIL DEFAULT DEBTOR may have possession of the COLLATERAL and use it in any lawful manner,and upon default SECURED <br /> PARTY shall have the immediate right to the possession of the COLLATERAL. <br /> DEBTOR SHALL BE IN DEFAULT under this agreement upon the happening of any of the following events or conditions: <br /> (a) default in the payment or performance of any obligation, covenant or liability contained or referred to herein or in any <br /> note evidencing the same; <br /> (b) the making or furnishing of any warranty,representation or statement to SECURED PARTY by or on behalf of DEBTOR which <br /> proves to have been false in any material respect when made or furnished; <br /> (c) loss,theft,damage,destruction, sale or encumbrance to or of any of the COLLATERAL,or the making of any levy seizure <br /> or attachment thereof or thereon; <br /> (d) death, dissolution, termination or existence, insolvency, business failure, appointment of a receiver of any part of the <br /> property of, assignment for the benefit of creditors by, or the commencement of any proceeding under any bankruptcy <br /> or insolvency law of, by or against DEBTOR or any guarantor or surety for DEBTOR. <br /> UPON SUCH DEFAULT and at any time thereafter,or if it deems itself insecure, SECURED PARTY may declare all Obligations <br /> secured hereby immediately due and payable and shall have the remedies of a secured party under Article 9 of the Colorado <br /> Uniform Commercial Code. SECURED PARTY may require DEBTOR to assemble the collateral and deliver or make it available to <br /> SECURED PARTY at a place to be designated by SECURED PARTY which is reasonably convenient to both parties. Expenses of retaking, <br /> holding, preparing for sale, selling or the like shall include SECURED PARTY'S reasonable attorney's fees and legal expenses. <br /> No waiver by SECURED PARTY of any default shall operate as a waiver of any other default or of the same default on a future <br /> occasion. The taking of this security agreement shall not waive or impair any other security said SECURED PARTY may have or <br /> hereafter acquire for the payment of the above indebtedness, nor shall the taking of any such additional security waive or impair <br /> this security agreement; but said SECURED PARTY shall retain its rights of set-off against DEBTOR. <br /> All rights of SECURED PARTY hereunder shall inure to the benefit of its successors and assigns; and all promises and duties <br /> of DEBTOR shall bind its heirs, executors or administrators or its successors or assigns. If there be more than one DEBTOR, their <br /> liabilities hereunder shall be joint and several. <br /> Dated this 7-4?f)day of January 1996. <br /> DEBTOR: TOWN OF BRECKENRIDGE SECURED PARTY: STATE OF COLORADO for the use <br /> and benefit of the Department of Natural <br /> By: J Resources, Colorado Water Conservation Board <br /> Printed name &title TE19l4EN 0. rA/E_ST, P4 YOl2 J 4$ <br /> - mss_ <br /> Daries C. Lile, Director <br /> (SEAL) <br /> ATTEST ` / C�..�tvA <br />