C153787 PIF

• Contract/PO #: C153787
• Contractor Name: Smith Irrigation Ditch
• Contract Type: Loan
• Loan Projects - Doc Type: Contract Documents

SECURITY AGREEMENT
DEBTOR: Smith Irrigation Ditch
96193 E. Highway 40
Craig, CO 81625
FEDERAL TAX NUMBER: 84- Pi L'
COUNTY: ROUTT(CODE: 28)
SECURED PARTY: State of Colorado, Colorado Water Conservation Board
1313 Sherman Street, Room 721
Denver, CO 80203
COLLATERAL: Contract Rights (Code: 030)
DEBTOR, for consideration, hereby grants to SECURED PARTY a security interest in the following property
and any and all additions, accessions and substitutions thereto or therefor, hereinafter called the
COLLATERAL: All revenues derived from annual dues and from assessments levied to repay the
indebtedness on the amount loaned to DEBTOR by SECURED PARTY, and all rights of DEBTOR to receive
said dues and assessment revenues from its members, as described in pledge of property provisions in
Loan Contract#C153787.
To secure payment of the indebtedness evidenced by certain Promissory Note between the above
named parties herewith, in the amount of$50,000.00 at an interest rate of 3.5% per annum for a term of
20 years, payable by DEBTOR to the SECURED PARTY until all principal and interest are paid in full in
accordance with said Promissory Note.
DEBTOR EXPRESSLY WARRANTS AND COVENANTS:
1. That except for the security interest grant hereby, DEBTOR is, or to the extent that this agreemen.
states that the COLLATERAL is to be acquired after the date hereof, will be, the owner of t.le
COLLATERAL free from any adverse lien, security interest or encumbrances.
2. That the execution and delivery of this agreement by DEBTOR will not violate any law or agreement
governing DEBTOR or to which DEBTOR is a party.
3. That, if DEBTOR is a corporation, its certificate and articles of incorporation and by-laws do not
prohibit any term or condition of this agreement.
4. That by its acceptance of the loan money pursuant to the terms of the CONTRACT and by its
representations herein, DEBTOR shall be estopped from asserting for any reason that it is not
authorized to grant a security interest in the COLLATERAL pursuant to the terms of this agreement.
5. To pay all taxes and assessments of every nature which may be levied or assessed against the
COLLATERAL.
6. To not permit or allow any adverse lien, security interest or encumbrance whatsoever upon the
COLLATERAL and not to permit the same to be attached or replevined.
7. That the DEBTOR will not use the COLLATERAL in violation of any applicable statutes, regulations,
ordinances, articles of incorporation or by-laws.
UNLESS IT DEFAULTS DEBTOR may have possession of the COLLATERAL, provided that DEBTOR
keeps all revenues derived from membership assessments in the amount of the annual loan payments
due under the contract, as amended, in an account separate from other revenues of DEBTOR and does
not use said revenues for any purpose not permitted by the CONTRACT. If DEBTOR defaults, SECURED
Appendix 6 to Loan Contract C153787