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<br />. . <br /> <br />CWCB determines that the PROJECT has been substantially completed, or, at the CWCB's <br />discretion, said interest shall be deducted from the final disbursement of loan funds that the <br />CWCB makes to the BORROWER. <br /> <br />3, Return of Unused Loan Funds. Any loan funds disbursed but not' expended for the <br />PROJECT in accordance with the terms of this Contract shall be remitted to the CWCB within <br />30 days of either (1) completion of the PROJECT or (2) upon the determination by the CWCB <br />that the PROJECT will not be completed. <br /> <br />4, BORROWER'S Authority To Contract. The BORROWER'S Partners have voted to approve this <br />loan and have authorized the BORROWER to enter into and perform in accordance with the <br />terms of this contract. The minutes of the Partnership meeting at which the Partners voted to <br />approve this loan are attached as Appendix 3 and incorporated herein. <br /> <br />5, Attorney's Opinion Letter. Prior to the execution of this contract by the CWCB, the <br />BORROWER shall submit to the CWCB a letter from its attorney stating that it is the attorney's <br />opinion that <br /> <br />a, the persons signing for the BORROWER have authority to sign such documents on behalf <br />of the BORROWER and to bind the BORROWER; <br /> <br />b. as required by the CWCB, all of the BORROWER'S partners and their spouses have duly <br />executed this contract and the promissory note; <br /> <br />c, the BORROWER'S Partners have validly voted to approve this contract; <br /> <br />d. there are no provisions in the BORROWER'S partnership agreement or any state or local <br />law that prevent this contract from binding the BORROWER; and <br /> <br />e, the contract will be valid and binding against the BORROWER if entered into by the eWCB. <br /> <br />6. Debt Service Reserve Account. To establish and maintain a debt service reserve account, <br />the BORROWER shall deposit an amount equal to one-tenth of an annual payment into its debt <br />service reserve fund on the due date of its first annual loan payment and annually thereafter <br />for the first ten years of this loan, In the event that the BORROWER applies funds from this <br />account to repayment of the loan, the BORROWER shall replenish the account within ninety <br />(90) days of withdrawal of the funds. Further, the BORROWER shall establish and maintain <br />adequate operation and maintenance and emergency repair services reserves for the <br />PROJECT. <br /> <br />7, Collateral. The collateral for this loar. is described in Section 4 (Collateral) of the Project <br />Summary, and secured by the deed of trust attached as Appendix 4 and incorporated <br />herein. The BORROWER shall not sell, convey, assign, grant, transfer, mortgage, pledge, <br />encumber, or otherwise dispose of the collateral for this loan. including the Pledged <br />Property, so long as any of the principal, accrued interest, and late charges, if any, on this <br />loan remain unpaid, without the prior written concurrence of the CWCB, In the event of any <br />such sale, transfer or encumbrance without the CWCB's written concurrence, the CWCB <br />may at any time thereafter declare all outstanding principal, interest, and late charges, if <br />any, on this loan immediately due and payable. <br /> <br />8, Release After Loan Is Repaid. Upon complete repayment to the CWCB of the entire <br />principal, all accrued interest, and late charges, if any, as specified in the Promissory Note, <br />the CWCB agrees to release and terminate any and all of the CWCS's right, title, and interest <br />in and to the collateral and the property pledged to repay this loan. <br /> <br />Page 2 of 8 <br /> <br />Loan Contract <br />