C153606 Contract

• Contract/PO #: C153606
• Contractor Name: Terrace Irrigation Company, The
• Contract Type: Loan
• Water District: 21
• County: Conejos
• Bill Number: HB 91-1006
• Loan Projects - Doc Type: Contract Documents

other property described in paragraph A.l4. above by deed or other
proper conveyance.

J. The Colorado Water Conservation Board,
employees, is hereby designated as the agent of
purpose of this contract.

its agents and
the State for the

K. The Contractor agrees and understands that sections 37-60-119
through 37-60-122, CRS, as amended, require that the loan of ~oney
by the State to the Contractor for this water project be
conditioned upon the repayment of the loan to the State. I The
Contractor hereby agrees to take any and all actions necessary to
guarantee such repayment as provided herein including, without
being limited to, the actions specified in this contract.

L. The Contractor agrees that the specific revenues to be pledged
to repay the State shall include, without being limited to, an
assessment levied for that purpose as authorized by Resolution of
the Contractor. The Contractor hereby pledges such assessment
revenues to repay the State loan, warrants that these revenues will
not be used for any other purpose, and agrees to provide the State
a perfected security interest in the form provided by the State
irrevocably pledging such revenues on the date of execution of this
contract.

M. The Contractor warrants that it has duly passed a Resolution
(Exhibit A) by it stockholders as provided in its By-Laws,
authorizing: the Contractor to enter into this contract with the
State to borrow the principal sum of One Million Six Hundred Fifty
Thousand Dollars ($1,650,000); to make and levy assessment(s)
sufficient to payoff this contract loan pursuant to its terms and
to discharge this lawful indebtedness; to set aside this assessment
revenue in a special fund separate and apart from other Contractor
revenues to assure repayment of this revenue to the State; and to
sign a security interest in such assessment revenues in favor of
the State to secure the repayment. Copies of such security
interest (Uniform Conunercial Code--Security Agreement and Uniform
Conunercial Code--Financing Statement) shall be attached hereto and
incorporated herein as Exhibit. E and F, respectively. The
Resolution of the Contractor and the security interest of the
Contractor are conditions precedent to State performance.

N. The Contractor warrants that in the event of a default by the
Contractor in the repayment to the State, and upon written notice
thereof from the State, the Contractor shall, pursuant to its By-
Laws, inunediately take all necessary actions to levy an additional
assessment and to pledge additional revenues in a sufficient amount
and in a timely manner to cure the default and to repay the State
as required by the contract. Such additional revenues shall be
deemed covered by the existing security interest.

O. The Contractor warrants that the security interest executed by
the Contractor in favor of the State to secure repayment of this
loan is a valid security interest which shall be binding against
the Contractor and that the Contractor has perfected this security
interest such that the State has priority over all other competing
claims for such secured revenues.

P. The Contractor warrants that by acceptance of the loan money
pursuant to the terms of this contract and by the Contractor I s
representation herein, the Contractor 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.

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