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<br />revenues, hereinafter collectively referred to as the "Pledged Property."
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<br />a. Segregation of Pledged Revenues. The BORROWER hereby agrees to set aside and keep
<br />the pledged revenues in an account separate from other BORROWER revenues, and warrants
<br />that it shall not use the pledged revenues for any other purpose.
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<br />b. Establish Security Interest. The BORROWER agrees that, to provide a security interest to the
<br />CWCB in the Pledged Property so that the CWCB shall have priority over all other competing
<br />claims for said property, it shall execute a Security Agreement attached hereto as Appendix 4
<br />and incorporated herein and an Assignment of Deposit Account as Security, attached as
<br />Appendix 5 and incorporated herein, prior to the disbursement of any loan funds, The CWCB
<br />shall perfect its security interest in the BORROWER'S right to receive assessment revenues by
<br />filing a UCC-1 Form with the Colorado Secretary of State.
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<br />c. Assessments For Repayment Of The Loan. Pursuant to its statutory authority, articles of
<br />incorporation and bylaws, the BORROWER shall take all necessary actions consistent therewith
<br />to levy assessments sufficient to pay this loan as required by the terms of this contract and the
<br />Promissory Note. In the event the assessments levied by the BORROWER become insufficient
<br />to assure such repayment to the CWCB, the BORROWER shall immediately take all necessary
<br />action consistent with its statutory authority, its articles of incorporation and bylaws including,
<br />but not limited to, levying additional assessments to raise sufficient revenue to assure
<br />repayment of this loan.
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<br />d. Assessments For Operations, Maintenance And Reserves. Pursuant to its statutory
<br />authority, articles of incorporation and bylaws, the BORROWER shall levy assessments in
<br />sufficient amounts to provide funds for adequate operation and maintenance, emergency
<br />repair services, and obsolescence and debt service reserves.
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<br />e. Debt Service Reserve Account. To establish and maintain the debt service reserve account,
<br />the BORROWER shall deposit an amount equal to one-tenth of an annual payment into its debt
<br />service reserve fund on the due date of its first annual loan payment and annually thereafter
<br />for the first ten years of this loan. In the event that the BORROWER applies funds from this
<br />accou(lt to repayment of the loan, the BORROWER shall replenish the account within ninety
<br />(90) days of withdrawal of the funds.
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<br />8. Collateral. The collateral for this loan is described in Section 5 (Collateral) of the Project
<br />Summary. The BORROWER shall not sell, convey, assign, grant, transfer, mortgage, pledge,
<br />encumber, or otherwise dispose of the collateral for this loan, including the Pledged Property,
<br />so long as any of the principal, accrued interest, and late charges, if any, on this loan remain
<br />unpaid, without the prior written concurrence of the CWCB, In the event of any such sale,
<br />transfer or encumbrance without the CWCB's written concurrence, the CWCB may at any time
<br />thereafter declare all outstanding principal, interest, and late charges, if any, on this loan
<br />immediately due and payable.
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<br />9, Release After Loan Is Repaid. Upon complete repayment to the CWCB of the entire principal,
<br />all accrued interest, and late charges, if any, as specified in the Promissory Note, the CWCB
<br />agrees to release and terminate any and all of the CWCB's right, title, and interest in and to the
<br />collateral and the property pledged to repay this loan,
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<br />10. Warranties.
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<br />a. The BORROWER warrants that, by accepting the loan money under this contract and by its
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