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<br /> <br />,<.,) <br /> <br />5. In Event Of A Conflict. In the event of conflict between the terms of this contract and <br />conditions as set forth in any of the appendices, the provisions of this contract shall control. <br /> <br />6. Eligible Expenses. PROJECT costs eligible for financing by the STATE shall be limited tothe <br />cost of: <br /> <br />a. Preparing final designs and specifications for the PROJECT. <br /> <br />b. Preparing bid and construction contract documents. <br /> <br />c. Preparing environmental assessment or environmental impact statements, and otherwise <br />complying with the Federal National Environmental Policy Act. <br /> <br />d. Complying with all federal, state, and local regulatory requirements, including the <br />obtaining of all required permits. <br /> <br />e. Fish and wildlife mitigation measures required by federal, state, or local laws and <br />regulations. <br /> <br />/. Actual construction as called for in the design documents and in change orders approved <br />by the STATE, the BORROWER, the CONSULTANT and the CONSTRUCTION FIRM. <br /> <br />g. Engineering services for construction management, including design and construction <br />management for STATE-approved change orders. <br /> <br />h. Legal services for reviewing engineering services contracts, reviewing this contract, <br />reviewing construction contract documents, and for complying with all federal, state, and <br />local regulatory requirements. <br /> <br />i. Repayment of any principal amount borrowed from theCWCB under Loan Contract <br />C153740, dated May 13,1997. <br /> <br />7. STATE May Release Contract. In its sole discretion, the STATE may at any time give any <br />consent, deferment, subordination, release, satisfaction, or termination of any or all of the <br />BORROWER'S obligations under this contract, with valuable consideration, upon such terms <br />and conditions as the STATE may determine to be advisable to further the purposes of this <br />contract or to protect the STATE'S financial interest lherein, and consistent with both the <br />statutory purposes of this contract and the limitations of the statutory authority under which it <br />is made. <br /> <br />8. Casualty And Eminent Domain. If, at any time, during the term of this contract, (a) the <br />BORROWER'S PROJECT facilities including buildings or any portion thereof, are damaged or <br />destroyed, in whole or in part, by fire or other casualty, or (b) title to or use of the PROJECT <br />facilities or any part thereof shall be taken under the exercise of the power of eminent <br />domain, the BORROWER shall cause the net proceeds of any insurance claim or <br />condemnation award to be applied to the prompt replacement, repair and restoration of the <br />PROJECT facilities or any portion thereof, or to repayment of this loan, the Prior Obligations <br />and any other parity obligations hereafter issued. Any net proceeds remaining after such <br />work has been completed shall be retained by the BORROWER. If the net insurance proceeds <br />are insufficient to pay the full cost of the replacement, repair and restoration, the BORROWER <br />shall complete the work and pay any cost in excess of the net proceeds. In the event <br /> <br />Page 10 of 14 <br />