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<br />-~ <br />, <br />. <br /> <br />PROMISSOR)( NOTE <br /> <br />Date C1~ '7 , 1998 <br />/I / <br />1. FOR VALUE. RE.CE.lYE.D, The Hawkeye Lateral Ditch Company ("BOR~WER") promises to pay the State <br />of Colorado Water Conservation Board ("STATE"), the principal sum of $154,112.75 with annual payments of <br />$8,643.82 based on the interest rate of 3.75% per annum on the outstanding principal balance for a term of 30 <br />years, or until paid in full, pursuant to Loan Contract #C 153796 ("LOAN CONTRACT"). <br /> <br />2. The first payment shall be due one year from the date the STATE determines that the PROJECT described In the <br />LOAN CONTRACT has been substantially completed, and annually thereafter until the entire principal sum and <br />any accrued interest shall have been paid in full. <br /> <br />3. All payments received shall be applied first to accrued interest and then to the retirement of the principal. <br />Payments shall be made payable to the Colorado Water Conservation Board and mailed to 1313 Sherman <br />Street, Room 721, Denver, Colorado 80203. <br /> <br />4. This Note may be prepaid in whole or in part at any time without premium or penalty, with prepayments <br />applied first to any accrued interest and then to reduce the principal amount. Any partial prepayment shall not <br />postpone the due date of any subsequent payments or change the amount of such payments. <br /> <br />5. This Note is issued pursuant to the LOAN CONTRACT between the STATE and the BORROWER. The LOAN <br />CONTRACT creates security interests in favor of the STATE to secure the prompt payment of all amounts which <br />may become due hereunder. The security interests, evidenced by a security agreement and by assignments, <br />cover certain revenues and accounts of the BORROWER. The LOAN CONTRACT, security agreement and <br />assignments grant additional rights to the STATE, including the right to accelerate the maturity of this Note in <br />certain events. <br /> <br />6. If any payment of principal or interest is not paid promptly when due or any default under the LOAN CONTRACT <br />or the security agreements and/or assignments securing this Note occurs, the STATE may declare the entire <br />outstanding principal balance of the Note, and all accrued interest, immediately due and payable, without <br />notice or demand, and the indebtedness shall bear interest at the rate of 15% per annum from the date of <br />default. <br /> <br />7. The BORROWER, any guarantor, and any successor of the BORROWER who may hereafter become primarily or <br />secondarily liable for the payment of this Note or any portion thereof hereby agree that if this Note or interest <br />thereon is not paid when due or suit is brought, then it shall pay all reasonable costs of collection, including <br />reasonable attorney fees. In the event of any bankruptcy or similar proceedings, costs of collection shall <br />include all costs and attorney fees Incurred in connection with such proceedings, including the fees of counsel <br />for attendance at meetings of creditors' committees or other committees. <br /> <br />8. This Note shall be governed in all respects by the laws of the State of Colorado. <br /> <br />BORROWER: The Hawkeye Lateral Ditch Company, <br />a Colorado nonprofit corporation <br /> <br />(S EAL) <br /> <br /> <br />By <br /> <br />Attest: <br /> <br />BY~Lc <br /> <br />~~ <br />Corpor Secreta <br /> <br />Attachment 2 to Loan Contract C153796 Amendment 1'1:. 1 <br />