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<br />. <br /> <br />. <br /> <br />ASSIGNMENT OF DEPOSIT ACCOUNT AS SECURITY <br /> <br />In consideration of and as security for a loan ("Loan") from the Colorado Water <br />Conservation Board ("Secured Party") to Jackson Lake Reservoir and Irrigation Company <br />("Debtor") pursuant to Contract Encumbrance Number C150063 dated August 1, 2001, <br />("Loan Contract"), Debtor hereby assigns, transfers and grants to Secured Party a <br />security interest in the funds contained in Deposit Account No. 43.so OU :3345 <br />("Account") at Community First National Bank ("Bank"), hereinafter referred <br />to as the Collateral. Debtor warrants that the Account has been established as a special <br />deposit with the funds deposited therein to be used solely for repayment of the Loan to <br />Secured Party. <br />The Collateral secures the payment and performance of all, of Debtor's present <br />and future, direct or indirect, absolute and contingent, express and implied, indebtedness, <br />liabilities, obligations and covenants (cumulatively "Obligations") under the Loan Contract <br />described above and any amendments thereto. This Assignment is made solely to secure <br />performance of the Obligations and is made subject to the following terms, covenants and <br />conditions: <br />1. This Assignment is effective upon signing and will remain in full force and effect until <br />Secured Party specifically terminates the security interest in the Collateral in writing. <br />Secured Party is not required to release this Assignment until the Loan is paid in full. <br />2. Neither the Debtor nor anyone else (except Secured Party) has any right to withdraw <br />any funds from the Account until the Secured Party releases this Assignment in <br />writing, except that, at Debtor's request, the Bank shall allow transfers of funds from <br />the Account to the Secured Party. <br />3. Debtor shall be in default under the 'Loan Contract for purposes of this Assignment <br />upon the occurrence of any of the following events or conditions: (a) failure or <br />omission to make any payment under the Loan Contract when due; (b) default in the <br />payment or performance of any obligation, covenant, agreement or liability contained <br />or referred to in the Loan Contract; (c) the making of any levy, seizure, or attachment <br />on the Collateral; (d) the Debtor becoming insolvent or unable to pay debts as they <br />mature. Secured Party shall give the Debtor written notice of any alleged default and <br />an opportunity to cure within thirty (30) days of receipt of such notice before Debtor <br />shall be considered in default for purposes of this Assignment. <br />4. Upon or at any time after a default under the Loan Contract as described in Paragraph <br />3 above, Secured Party shall be entitled to notify the Bank to pay Secured Party the <br />funds contained in the Account. Secured Party shall apply such moneys first to costs <br />associated with collection, including, but not limited to, reasonable attorney's fees, <br />next to late charges, if any, then to outstanding interest, and then to the principal sum <br />of the Loan. <br />5, Debtor shall not sell, transfer, assign, give, or otherwise dispose of any of the <br />Collateral or any interest therein as long as this Assignment is in effect. <br />6. The modification or waiver of any of Debtor's obligations or Secured Party's rights <br /> <br />Appendix 5 to Loan Contract C150063 <br />