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<br />b, Establish security interest in the asseSSll1ents. The BORROWER agrees that in order to provide a
<br />security interest for the STATE irrevocably pledging such assessments, it will provide a Uniform
<br />Commercial Code Security Agreement and Financing Statement, such document completed and
<br />properly executed, incorporated herein as Appendix C. No monies shall be advanced prior to BORROWER
<br />providing this form,
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<br />c, Renewal of UCC agreements in fourth year. The BORROWER will, within thirty (30) days prior to the
<br />end of the fourth year that this contract is in effect and every five (5) years thereafter, deliver to the
<br />ST ATE a fully and properly executed Continuation Statement (Form UCC-3) of the security interest (UCC
<br />Security Agreement and Financing Statement) required by this contract.
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<br />d, Levy charges and fees for repayment of the loan. The BORROWER shall, pursuant to its statutes, its
<br />articles of incorporation and by-laws, and as authorized by its resolution, take all necessary actions
<br />consistent therewith to levy assessments sufficient enough to pay this contract loan debt in a timely
<br />manner and as required by the terms and conditions herein, In the event the assessments levied by
<br />the BORROWER become insufficient to assur~ repayment to the STATE as required by the terms and
<br />conditions herein, then the BORROWER, upon written notice thereof from the STATE, shall immediately
<br />take all necessary action consistent with the statutes, its articles of incorporation, by-laws, and
<br />resolutions, including but not be limited to levying additional assessments to raise sufficient
<br />assessments to assure repayment of the loan to the STATE.
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<br />e. Levy'assessments for operations, maintenance. reserves, and debt reserves. The BORROWER shall,
<br />pursuant to the statutes, its articles of incorporation, by-laws, and resolutions, levy assessments from
<br />time to time as necessary to provide sufficient funds for adequate operation and maintenance,
<br />emergency repair services, obsolescence reServes, and debt reserves.
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<br />14. Progress reports. The BORROWER shall, with the assistance of the CONSULTANT, prepare a progress
<br />report which contains a statement of the actual PRO,JECT copstruction costs for that month and shall forward
<br />said statement to the STATE. '
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<br />15. Periodic inspections. The BORROWER shall bermit a designated representative of the STATE to make
<br />periodic inspections of the PROJECT construction, its operations and accounts. Any such inspections by the
<br />STATE are solely for the purpose of verifying compliance with the terms and conditions of the contract and shall
<br />not be construed nor interpreted as an approval of the actual design and/or construction of any element of the
<br />PROJECT,
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<br />16, Adhere to applicable laws. The BORROWER shall strictly adhere to all applicable federal, state, and local
<br />laws and regulations that have been or may hereaft~r be established,
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<br />17. No discrimination of services. The services of said PROJECT will be made available within its capacity
<br />and in accordance with all pertinent statutes, rules and regulations, and operational guidelines to all persons
<br />in the BORROWER'S service area without discriminatior, as to race, color, religion, or national origin at reasonable
<br />charges (including assessments or fees). whether for one or more classes of service, in accordance with a
<br />schedule of such charges formally adopted by the BORROWER, as may be modified from time to time,
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<br />B. The STATE agrees as follows:
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<br />1, Agreement to loan money. The STATE agre~s to loan to the BORROWER an amount not to exceed that
<br />specified in the Promissory Note Provisions of this ~ontract,
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<br />2. Disbursements, After receipt of the monthly progress report from the BORROWER, and review and
<br />acceptance of the items therein as eligible expenses as described below, the STATE will pay to the BORROWER
<br />the amount 6f the report or such portion that has been approved by the STATE. Such payment shall be made
<br />within thirty (30) days from the approval of each monthly progress report.
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<br />KINGS ROW HOMEOWNERS ASSOCIATION
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<br />LOAN CONTRACT
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