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b. Interest rate. The interest on the principal shall accrue at the rate of four percent (4%) per annum on all funds advanced to BORROWER. c. Duration. The repayment period of this loan shall be thirty (30) years. d. Loan payment. The payments shall be 30 annual installments of $50,370.02, which amount includes principal and interest. The first installment shall be due and payable one year after the STATE determines that the PROJECT has been substantially completed, and annually thereafter until the entire principal sum and any accrued interest shall have been paid. Installment payments are to be made payable to the CWCB at the address given below. e. Interest during construction. The BORROWER shall repay to the STATE interest which will be calculated at the rate of four percent (4%1 per annum on each loan advance disbursed to the BORROWER during construction. Said accumulated interest shall be paid to the STATE as a single lump sum ten (10) days after the STATE determines that the PROJECT has been substantially completed. or, at the STATE'S discretion, the amount shall be ded~cted from the final disbursement of loan funds that the STATE makes to the BORROWER. .f: Application of FSA grant to repayment of loan, Upon receipt of the FSA grant of $400,000, the DISTRICT shall transfer said grant funds to the BORROWER to apply to the costs of the PROJECT. The BORROWER shall submit the $400,000 in grant funds to the STATE to apply to repayment of this loan within thirty (30) days of the DISTRICT'S receipt of said grant funds. Subsequent to application of the $400,000 to the loan, the parties shall enter intO a contract amendment establishing the terms of repayment of the remainder of this loan. g. Prepayment conditions. The BORROWER may prepay all or any of the loan at any time, without penalty. These payments will be applied first to any accrued interest and then to reduce the principal amount. h. Collection costs. If the principal or accrued interest under this contract is not paid w.hen due, the BORROWER agrees to pay all reasonable costs of collection, including reasonable attorney fees. In the event of any bankruptcy or similar proceedings, costs of collection shall include all costs and attorney fees incurred in connection with such proceedings, including the fees of counsel for attendance at meetings of creditors' committees or other committees. 10. Warranties. The DISTRICT and the BORROWER warrant the following: a. By acceptance of the loan money pursuant to the terms of this contract and by their representations herein, the DISTRICT and the BORROWER shall be estopped from asserting for any reason that the BORROWER and the DISTRICT, acting by ~nd through the BORROWER, are not authorized or obligated to repay the loan money to the STATE a$ required by this contract. b. Both the DISTRICT and the BORROWER warrant ttlat they have 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 DISTRICT and the BORROWER. c. The DISTRICT and the BORROWER have not employed or retained any company or person, other than a bona fide employee working solely for the BORRowER or the DISTRICT, to solicit or secure this contract and have not paid or agreed to pay any person, company, corporation, individua( 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 Mutual Mesa Lateral Enterprise is an enterPrise legally created and maintained in compliance with ~ 37-45.1-101, et sea., C.R.S., and has authority to enter into this contract with the STATE. The Orchard Mesa Irrigation District & Mutual Mesa Lateral Enterprise Page 5 of 12 Loan Contract