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<br />hereby agree to establi. separate account into which all such aeys shall be deposited,
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<br />13, Pledge of revenues, The CITY and the BORROWER agree that the specific revenues to be pledged to
<br />repay the STATE shall include, but not be limited to, water rates, charges and fees levied for that
<br />purpose as authorized by ordinance of the BORROWER.
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<br />a, Revenues for this loan are to be kept separate, The CITY and the BORROWER hereby
<br />irrevocably pledge such revenues to repay the STATE loan, agree that these revenues shall be set
<br />aside and kept in an account separate from other BORROWER revenues, and warrant that these
<br />revenues will not be used for any other purpose except for repayment of the BORROWER'S Water
<br />and Sewer Revenue Refunding Bonds Series 1990 ("1990 Bonds") and for payments required by
<br />the CITY'S 1996 Govemment Agency Bond and Loan Agreement with the Colorado Water
<br />Resources and Power Development Authority ("1996 AUTHORITY Bonds/Loan").
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<br />b, Establish parity status for this loan, The STATE, the CITY and the BORROWER recognize that
<br />the BORROWER has also pledged such water system revenues to repay the BORROWER'S 1990
<br />Bonds and 1996 AUTHORITY Bonds/Loan, The CITY and the BORROWER shall meet the
<br />requirements of the issuer of the.J 990 'Bonds and of the AUTHORITY to establish parity status of
<br />this loan with the 1990 Bonds and the 1996 AUTHORITY Bonds/Loan,.. kcopy of the Net Revenues
<br />Certificate from an independent certified publicaccountal1C:certifYlng that the CITY and the
<br />BORROWER meet the pertinent parity ,tests is attached' hereto as Appendix 4 and incorporated
<br />herein,'
<br />
<br />.....
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<br />c, Establish security interest in the revenues. The BORROWER and the CITY agree that, in order
<br />to provide a security interest to the STATE in the pledged revenues so that the STATE shall have
<br />priority over all other competing claims for said revenues, except the BORROWER'S pledge of said
<br />revenues for repayment of the 1990 Bonds and the 1996 AUTHORITY Bonds/Loan, with which this
<br />loan shall have parity status, the BORROWER and the CITY shall provide a completed and properly
<br />executed Security Agreement, which is attached hereto as Appendix 5 and incorporated herein,
<br />The CITY and the BORROWER acknowledge that the STATE shall file a UCC-1 Financing
<br />Statement with the Colorado Secretary of State to perfect its security interest in the pledged
<br />revenues,
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<br />d, Levy charges and fees for repayment of the loan. The CITY and the BORROWER shall,
<br />pursuant to statutory authority and as authorized by their ordinances, take all necessary actions
<br />consistent therewith to. provide sufficient funds for adequate operation and maintenance,
<br />emergency repair services, obsolescence reserves, debt reserves, and to establish revenues from
<br />terms and conditions herein to assure repayment of the loan to the STATE, In the event these
<br />revenues are or become insufficient to assure repayment to the STATE as required by the terms
<br />and conditions herein, then the BORROWER shall immediately take all necessary action consistent
<br />with its statutory authority, including but not limited to adjusting water charges and fees, to raise
<br />sufficient revenue to assure repayment of the loan to the STATE,
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<br />e, Additional debts or bonds. The CITY and the BORROWER shall not issue any indebtedness
<br />payable from the pledged revenues and having a lien thereon which is superior to the lien of
<br />this loan, The CITY and the BORROWER may issue parity debt, with the prior written approval of
<br />the STATE, if:
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<br />i. CITY and the BORROWER are in substantial compliance with all of the obligations of this
<br />contract at the time of issuance of the parity debt, including, but not limited to, being current
<br />
<br />City of Idaho Springs and
<br />City of Idaho Springs, Colorado, Water Enterprise
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<br />Page 7 of 14
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