<br />,
<br />
<br />and evidencing this debt is attached as Appendix C and incorporated herein,
<br />
<br />a, Interest During Study Period. As the loan funds are disbursed by the STATE to the
<br />BORROWER during the study period, interest shall accrue at the rate of 3,5%, The amount of
<br />the interest accrued during the study period shall be calculated by the STATE and the
<br />BORROWER shall repay that amount to the STATE either within ten (10) days after the date the
<br />STATE accepts the completed STUDY, or, at the STATE'S discretion, the amount shall be
<br />deducted from the final disbursement of loan funds that the STATE makes to the BORROWER,
<br />
<br />b, Final loan amount. In the event that the BORROWER does not borrow the full $75,000, the
<br />STATE shall issue to the BORROWER a refund in the amount of the loan funds not borrowed
<br />when the STATE cashes the CD Account for the DISTRICT'S first annual payment of the
<br />Promissory Note,
<br />
<br />7. Warranties.
<br />
<br />a, The DISTRICT and the BORROWER warrant that by acceptance of the loan money pursuant to
<br />the terms of this contract and by their representations herein, the DISTRICT and the
<br />BORROWER shall be estopped from asserting for any reason that they are not authorized or
<br />obligated to repay the loan money to the STATE as required by this contract
<br />
<br />b, The DISTRICT and the BORROWER warrant that they have.full power and authority to enter into
<br />this contract The execution and delivery of this contract and the performance and
<br />observation of its terms, conditions and obligations have been duly authorized by all
<br />necessary actions of the DISTRICT and the BORROWER,
<br />
<br />c, The DISTRICT and the BORROWER warrant that they have not employed or retained any
<br />company or person, other than a bona fide employee working solely for the BORROWER, to
<br />solicit or secure this contract and have not paid or agreed to pay any person, company,
<br />corporation, individual, or firm, other than a bona fide employee, any fee, commission,
<br />percentage, gift, or other consideration contingent upon or resulting from the award or the
<br />making of this contract
<br />
<br />d, The DISTRICT and the BORROWER warrant that the Dolores Water Conservancy District Water
<br />Activity Enterprise is an enterprise legally created and maintained in compliance with S 37-
<br />45,1-101, et sea" C.RS" and Article X, Section 20 of the Colorado Constitution, and has
<br />authority to enter into this contract with the STATE, The BORROWER and/or the DISTRICT shall
<br />immediately notify the STATE in writing if the circumstances which formulate the basis of this
<br />warranty change.
<br />
<br />e, The DISTRICT and the BORROWER warrant that the property identified in the Collateral
<br />Provisions of this contract is not encumbered by any other liens of any party other than the
<br />STATE or in any other manner.
<br />
<br />8. Collateral. The security provided for this loan shall be an undivided one hundred percent (100%)
<br />interest in the principal of five (5) certificate of deposit accounts estabiished by the DISTRICT
<br />and/or the BORROWER in the name of the State, each in the amount of $16,611,10, hereinafter
<br />referred to as CD ACCOUNTS, The STATE shall use the funds contained in the CD ACCOUNTS for
<br />the purpose of paying principal and interest due under this contract in accordance with the terms
<br />of the Promissory Note,
<br />
<br />9. Collateral During Repayment. The DISTRICT and the BORROWER shall not sell, convey, assign,
<br />grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the CD Accounts, or any
<br />portion thereof , so long as any of the principal and any accrued interest required by the
<br />
<br />Feasibility Report Loan Contract
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