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<br />,and!1i3,jToWoshJp,8'North; Rarigei,75'West of the 6th P.M., Larimer county Colorado,herelnafter
<br />-e'e"",:.:;.ot'';'''''s'-''^llateral-' """:,"':,,,' " ' " " ":,,,,'
<br />'_ '.' 1 'I~': ~~, hVV !,- .':: .',-. ":,;..,.:,_,d".. _ . . . " ' -, >-,-: ,'__ _ ,:;,,--.
<br />";~:-"_~_!;_~'^'^\:;:~':"" .'," ~,,". ~, ";", ':'" :.,',:'" ,:., -:. "'" ; _ ~>/'>-:\t:'r,,':-":'-"
<br />12. P(e/:lge,0(p:r9Po!W.,' The B()fJflPWERhereby irrevocably pledges to the, STATE for;RIJ~~of
<br />repayp1erit of this loan revenues from, assessments levied for that purpose as authoriie~f;:bYf!1:e,
<br />BoRROWER'S resolution and all of the' BoRROWER'S rights to receive said assessment (evlllwe13' ,
<br />. _ 1 "_,: '''~'':' '''''''_'~'_-\,' '.-..,
<br />" '!from'ltS, merilberli; (hereinafter ~lIectively referred to as the "pledged property"). Fui1fi~~rei) ,
<br />BoRROWER agrees that, ' " ',,'Si)f:y ",
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<br />~.' Re';'en~es For This Loan Are To Be Kept Separate. The BoRROWER herebYagt~;Kq:~~)'
<br />aside and" ~eep' the ' ple(:lged . revenues In "an' account. separate from other';~*o/~<\.
<br />revenues, and warrants that ltShall not use the pledged revenues for any otherpu/'PWl,elii:;;';~,fi,
<br />. , _ ' _'- . . " ' .' ~: ,", _ '"C' , J, _._',' _,'- -' . . -:_'::"-::'~:-'~'<:;');;:~:~:;}:~"!i:~:;;-_-,
<br />b:,Elitli~lIsh SecurltylnteresJ:The::BoRRqW!:Ragrees th~t, In order to provId~,~a;~~iity;
<br />',Interest for Ule STATI: In the pledged properly so ,that the STATE shall have pri~ot(Qv~r,'ijill!,
<br />other competing claims for Ssid property, it shall execute a Security Agreement, a~ched .'
<br />, hereto' as Appendix 4 incorporated herein, and an Assignment of Deposit Account, as .
<br />Security, attached as Appeildlx 5 and incorporated herein, prior to the disbursementofal'lY
<br />loan funds. The BORROWER acknowledges that the STATE shall perfect its security interest in
<br />1he BORROWER'S right to receive assessment revenues by filing a UCC-1 Form With'the
<br />" Colorado SecretarY of State.
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<br />c. Assessments For Repayment Of The Loan. Pursuant to its statutory authority,articles.of
<br />, incorporation and by-laws, and as authorized by its resolution, the BORROWER shall take all
<br />necessary actions consistent therewith to levy assessments sufficient to pay this loan as
<br />required by the terms of this contract and the promissory note. In the event the assessments
<br />levied by the BORROWER become insufficient. to assure such repayment to the STATE,the
<br />BORROWER shall immediately take all necessary action consistent with its statutory authority,
<br />its articles of incorporation, bylaws and resolution, including, but not limited to,levying
<br />additional assessments to raise sufficient revenue to assure repaynient of theloantotha
<br />STATE.
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<br />d. Assessments For Operations, Maintenance And 'Reserves. Pursuant to its statutory ,
<br />authority, articles of Incorporation, by-laws, and reSolutions, the BoRROWER shall levy
<br />assessments from time to time as necessary to' provide sufficient funds for adequate
<br />operation and. maintenance, emergericy repair services, obsolescence reserves and debt
<br />service reserves. BoRROWER shall deposit an amount equal to one-tenth of an annual
<br />payment into its debt service reserve fund one year from the first loan disbursement, and
<br />annually thereafter for the first ten years of this loan. In the event that the Borrower appDes
<br />funds from this account to repayment of the loan, the Borrower shall replenish the account
<br />within ninety (90) days of withdrawal of the funds.
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<br />13. Change of Use of Water Shares During Term of Contract. The interest rate for this loan is
<br />based on the CWCB's blended agricultural and municipal rates. The BORROWER agrees to
<br />notify the STATE of any c~ange of the use of the water rights represented by Its shares from
<br />irrigation to municipal or commercial use. The interest rate shall be revised when the blend of
<br />the agricultural rate and the municipaVcommercial rate increases the original interest rate by
<br />0.5% or more. The parties shall execute a contract amendment" including a revised promissory
<br />note, to effect said change in interest rate.
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<br />14. Collateral During Repayment. The BORROWER shall not sell, convey, assign, grant, transfer,
<br />mortgage, pledge, encumber, or otherwise dispose of the property provided as security for this
<br />
<br />Tunnel Water Company
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<br />Loan Contract '
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<br />Page 6 of 12
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