BOARD01622

• Board Meeting Date: 3/10/1998
• Description: CF Section - List of Standard Contract Provisions
• Board Meetings - Doc Type: Memo

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10. Changes. The parties may decrease the amount of the loan under this contract or extend the time
for completion of the PROJECT through a REVISION LETTER, approved by the State Controller or his
designee and the BORROWER, in the form attached hereto as Appendix X. The REVISION LETTER
shall not be valid until approved by the State Controller or such assistant as he may designate.
Upon proper execution and approval, the REVISION LETTER shall become an amendment to this
contract and, except for the Special Provisions of the contract, the REVISION LETTER shall supersede
the contract in the event of a conflict between the two. The parties understand and agree that the
REVISION LETTER may be used only for decreasing the final loan amount or to extend the time for
completion of the PROJECT. In the event that the parties execute the REVISION LETTER to decrease
the amount of the loan, the parties shall amend the Promissory Note and all documents executed by
the BORROWER to convey security interests to the STATE as required by this contract to reflect the
decreased loan amount.

11. Warranties.

a. The BORROWER warrants that, by acceptance of the loan money pursuant to the terms of this
contract and by the BORROWER'S representation herein, the BORROWER shall be estopped from
asserting for any reason that it is not authorized or obligated to repay the loan money to the
STATE as required by this contract.

b. The BORROWER warrants that it has full power and authority to enter into this contract. The
execution and delivery of this contract and the performance and observation of its terms,
conditions and obligations have been duly authorized by all necessary actions of the
BORROWER.

c. The BORROWER warrants that it has not employed or retained any company or person, other
than a bona fide employee working solely for the BORROWER, to solicit or secure this contract
and has not paid or agreed to pay any person, company, corporation, individual, or firm, other
than a bona fide employee, any fee, commission, percentage, gift, or other consideration
contingent upon or resulting from the award or the making of this contract.

d. The BORROWER warrants that the property identified in the Collateral Provisions of this contract
is not encumbered by any other deeds of trust to or liens of any party other than the STATE or in
any other manner.

12. Collateral. Part of the security provided for this loan, as evidenced by the executed Assignment of
Certificate of Deposit attached as Appendix X and incorporated herein, shall be an undivided one
hundred percent (100%) interest in a certificate of deposit account established by the BORROWER in
the amount of one annual loan payment ($X), hereinafter referred to as CD ACCOUNT. The STATE
shall use the funds contained in the CD ACCOUNT for the purpose of paying principal and interest due
under this contract not otherwise paid by the BORROWER. Any amount withdrawn by the STATE for
this purpose shall be replenished by the BORROWER within sixty days after such withdrawal. The
STATE shall not disburse any loan funds under this contract until the BORROWER has established the
CD ACCOUNT.

13. Pledge Of Property. The BORROWER hereby irrevocably pledges to the STATE for purposes of
repayment of this loan revenues from assessments levied for that purpose as authorized by the
BORROWER'S resolution and all of the BORROWER'S rights to receive said assessment revenues from
its members (hereinafter collectively referred to as the "pledged property"). Furthermore, BORROWER
agrees that

. a. Revenues For This Loan Are To Be Kept Separate. The BORROWER hereby agrees to set
aside and keep the pledged revenues in an account separate from other BORROWER revenues,

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