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<br />ASSIGNrv.cNT OF CERTIFICATE OF DE"'OSIT <br /> <br />In consideration of and as security for reimbursement for monies owing under a loan from <br />the Colorado Water Conservation Board ("Lender") to the Horse Creek Water Users <br />Association ("Owner") in the amount of $825,000 ("Loan") pursuant to Contract <br />Encumbrance Number C153771, ("Loan Contract"), Owner hereby assigns to the Lender <br />the principal of the Certificate of Deposit No. 1.::?"ILj 3 in the amount of <br />$35,691.46 ("Collateral") issued by the First National Bank of Limon ("Bank"). <br /> <br />The Collateral secures the payment and performance of all of Owner's present and future, <br />direct or indirect, absolute and contingent, express and implied, indebtedness, liabilities, <br />obligations and covenants (cumulatively "Obligations") by Lender pursuant to the Loan <br />Contract described above and any amendments thereto. This Assignment is made solely <br />to secure performance of the Obligations and is made subject to the following terms, <br />covenants and conditions: <br /> <br />1. Owner shall deliver the original Certificate of Deposit to Lender upon the execution of <br />this Assignment. This Assignment shall continue until Lender specifically terminates <br />the security interest in the Collateral in a writing signed by Lender. <br /> <br />2. Owner may withdraw all interest eamed by the Certificate of Deposit, provided that the <br />principal amount of the Certificate of Deposit equals $35,691.46. <br /> <br />3. Lender shall be entitled to notify the Bank to pay Lender any monies owing OWn€i <br />under the Certificate of Deposit in the event of a default under the Obligations. The <br />Lender shalL. apply such monies first to costs associated with collection, including <br />reasonable attomey's fees, next to outstanding interest, and then to the principal sum of <br />the Loan. In the event that Owner possesses or receives possession of any <br />instruments or other remittances with respect to the Certificate of Deposit following the <br />giving of such notifiCation, Owner shall hold such instruments and other remittances in <br />trust for Lender apart 'from Owner's other property, endorse the instruments and other <br />remittances to Lender, and immediately provide Lender with possession of the <br />instruments and other remittances. <br /> <br />4. The Owner shall be in default under this Assignment upon the occurrence of any of the <br />following events or conditions: (a) failure or omission to make any payment under the <br />Loan Contract when due; (b) default in the payment or performance of any obligation, <br />covenant, agreement or liability contained or referred to in the Loan Contract; (c) the <br />making of any levy, seizure, or attachment on the Collateral; (d) the Owner becoming <br />insolvent or unable to pay debts as they mature. The Lender shall give the Owner <br />written notice of any alleged default and an opportunity to cure within thirty (30) days <br />of receipt of such notice before Owner shall be considered in default for purposes of <br />this agreement. <br /> <br />5. Owner hereby appoints Lender as its attorney-in-fact to endorse Owner's name on all <br />instruments and other remittances payable to Owner with respect to the Certificate of <br />Deposit. This power of attorney is coupled with an interest and is irrevocable. <br /> <br />6. The modification or waiver of any of Owner's obligations or Lender's rights under this <br />Assignment must be contained in a writing signed by Lender. A waiver on one <br />occasion shall not constitute a waiver on any other occasion. <br /> <br />Appendix 5 to Loan Contract C153771 <br />