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<br />ASSIGNMENT OF DEPOSIT ACCOUNT AS SECURITY <br /> <br />In consideration of and as security for a loan from the Colorado Water Conservation Board <br />("Secured Party") to Chipperfield Lane Ditch, Inc. ("Debtor") in the amount of $41,011.94 <br />("Loan") pursuant to Contract Encumbrance Number C153785, as amended ("Loan Contract"), <br />Debtor hereby assigns, transfers and grants to Secured Party a security interest in the funds <br />contained in Deposit Account No. 1020213922 (the "Account") at the Mesa Nationa(San'k,.Rifle, <br />,'" .." <br />Colorado ("Bank"), hereinafter referred to as the Collateral. Debtor warrants ti1at the.Acc9unt'has <br />been established as a special deposit with the funds deposited therein to':be used sole.!y for <br />repayment of the Loan to Secured Party. { .~; ",. ~. <br /> <br />The Collateral secures the payment and performance of all of Debtor'S.. present and future, <br />direct or indirect, absolute and contingent, express and implied, ind6t1t~'ooess, liabin.ties, <br />obligations and covenants (cumulatively "Obligations") under the Loan Contr~cj, ~;;Sc.ribed above <br />and any amendments thereto. This Assignment is made solely to secure petlor~~i1c;e.:'b'f the <br />Obligations and is made subject to the following terms, covenants and conditions, <br /> <br />1. This Assignment is effective upon signing and will remain in full force and effect until Secured <br />Party specifically terminates the security interest in the Collateral in writing. Secured Party is <br />not required to release this Assignment until the Loan is paid in full. <br /> <br />2. Neither the Debtor nor anyone else (except Secured Party) has any right to withdraw any <br />funds from the account listed above until the Secured Party releases this Assignment in <br />writing, except that, at Deb~or' s request, the Bank shall allow the transfer of the annual Loan <br />payment to Secured Party,." , ., <br /> <br />3. Debtor shall be in default under the Loan Contract for purposes of this Assignment upon the <br />occurrence of any of the following events or conditions: (a) failure or omission to make any <br />payment under the Loan Contract when due; (b) default in the payment or performance of any <br />obligation, covenant, agreement or liability contained or referred to in the Loan Contract; (c) <br />the making of any levy, seizure, or attachment on the Collateral; (d) the Debtor becoming <br />insolvent or unable to pay debts as they mature. Secured Party shall give the Debtor written <br />notice of any alleged default and an opportunity to cure within thirty (30) days of receipt of <br />such notice before Debtor shall be considered in default for purposes of this Assignment. <br /> <br />4. Upon or at any time after a default under the Loan Contract as described in Paragraph 3 above, <br />Secured Party shall be entitled to notify the Bank to pay Secured Party the funds contained in <br />the Account.. Secured Party shall apply such moneys first to costs associated with collection, <br />including, but not limited to, reasonable attorney's fees, next to outstanding interest, and then <br />to the principal sum of the Loan. <br /> <br />5. Debtor shall not sell, transfer, assign, give, or otherwise dispose of any of the Collateral or any <br />interest therein as long as this Assignment is in effect. <br /> <br />6. The modification or waiver of any of Debtor's obligations or Secured Party's rights under this <br />Assignment must be contained in a writing signed by Secured Party. A waiver on one <br />occasion shall not constitute a waiver on any other occasion. <br /> <br />7. The rights and remedies of the Secured Party stated in this Assignment are in addition to any <br />other rights the Secured Party may have under the Loan Contract or any law. <br /> <br />8. This Assignment shall be binding upon Debtor and its successors, assigns. trustees, and <br />receivers. <br /> <br />Attachment C to Loan Contract C153785 Amendment 1 <br />