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<br />"" <br /> <br />AMENDED SECURITY AGREEMENT <br /> <br />DEBTOR: The Durkee Ditch Company, Inc. <br />Box 41 <br />Eckert, CO 81418 <br /> <br />FEDERAL TAX NUMBER: 84-1411463 <br /> <br />COUNTY: DELTA (CODE: 18) <br /> <br />SECURED PARTY: STATE OF COLORADO, COLORADO WATER CONSERVATION BOARD <br />1313 Sherman Street, Room 721 <br />Denver, CO 80203 <br /> <br />COLLATERAL: Contract Rights (Code: 030) <br /> <br />DEBTOR, for consideration, hereby grants to SECURED PARTY a security interest in the following <br />property and any and all additions, accessions and substitutions thereto or therefor, hereinafter called <br />the COLLATERAL: All revenues derived from assessments levied to repay the indebtedness on the <br />amount loaned to DEBTOR by SECURED PARTY, and all rights of DEBTOR to receive said assessment <br />revenues from its stockholders, as described in pledge of property provisions in Loan Contract No. <br />C153790, as amended. <br /> <br />To secure payment of the indebtedness evidenced by certain Promissory Note between the above <br />named parties herewith, in the amount of $95,000.00 at an interest rate of 3.75% per annum for a <br />term of 30 years, payable by DEBTOR to the SECURED PARTY until all principal and interest are paid in <br />full in accordance with said Promissory Note. The parties are amending this security agreement <br />as part of Amendment No.1 to the Loan Contract to reduce the loan amount to $95,000. <br /> <br />DEBTOR EXPRESSLY WARRANTS AND COVENANTS: <br /> <br />1. That except for the security interest grant hereby, DEBTOR is, or to the extent that this agreement <br />states that the COLLATERAL is to be acquired after the date hereof, will be, the owner of the <br />COLLATERAL free from any adverse lien, security interest or encumbrances. <br /> <br />2. That the execution and delivery of this agreement by DEBTOR will not violate any law or <br />agreement governing DEBTOR or to which DEBTOR is a party. <br /> <br />3. That, if DEBTOR is a corporation, its certificate and articles of incorporation and by-laws do not <br />prohibit any term or condition of this agreement. <br /> <br />4. That by its acceptance of the loan money pursuant to the terms of the CONTRACT and by its <br />representations herein, DEBTOR shall be estopped from asserting for any reason that it is not <br />authorized to grant a security interest in the COLLATERAL pursuant to the terms of this agreement. <br /> <br />5. To pay all taxes and assessments of every nature which may be levied or assessed against the <br />COLLATERAL. <br /> <br />6. To not permit or allow any adverse lien, security interest or encumbrance whatsoever upon the <br />COLLATERAL and not to permit the same to be attached or replevined. <br /> <br />7. That the DEBTOR will not use the COLLATERAL in violation of any applicable statutes, regulations, <br />ordinances, articles of incorporation or by-laws. <br /> <br />UNLESS IT DEFAULTS DEBTOR may have possession of the COLLATERAL, provided that <br />DEBTOR keeps all revenues derived from stockholder assessments in the amount of the annual loan <br />payments due under the contract, as amended, in an account separate from other revenues of <br />DEBTOR and does not use said revenues for any purpose not permitted by the CONTRACT. If DEBTOR <br />defaults, SECURED PARTY shall have the immediate right to the possession of the COLLATERAL. <br /> <br />Exhibit B to Loan Contract C153790 Amendment No.1 <br />