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Grant Agreement No. 46000XXXX
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such notice by Grantee and the State shall no longer be required to provide funds under this Grant
Agreement and the Grant Agreement shall no longer be binding on either part.

11) WITHHOLDING OF DISBURSEMENTS BY STATE. If State determines that a project is not being
implemented in accordance with the provisions of this Grant Agreement, or that Grantee has failed in any
other respect to comply with the provisions of this Grant Agreement, and if Grantee does not remedy any
such failure to State’s satisfaction, State may withhold from Grantee all or any portion of the State funding
and take any other action that it deems necessary to protect its interests. Where a portion of the State
funding has been disbursed to the Grantee and State notifies Grantee of its decision not to release funds
that have been withheld pursuant to Paragraph 13, “Continuing Eligibility,” the portion that has been
disbursed shall thereafter be repaid immediately with interest at the California general obligation bond
interest rate at the time the State notifies the Grantee, as directed by State. State may consider Grantee’s
refusal to repay the requested disbursed amount a contract breach subject to the default provisions in
Paragraph 12, “Default Provisions.” If State notifies Grantee of its decision to withhold the entire funding
amount from Grantee pursuant to this paragraph, this Grant Agreement shall terminate upon receipt of
such notice by Grantee and the State shall no longer be required to provide funds under this Grant
Agreement and the Grant Agreement shall no longer be binding on either party.

12) DEFAULT PROVISIONS. Grantee will be in default under this Grant Agreement if any of the following
occur:

1. Substantial breaches of this Grant Agreement, or any supplement or amendment to it, or any other
agreement between Grantee and State evidencing or securing Grantee’s obligations;

2. Making any false warranty, representation, or statement with respect to this Grant Agreement or the
application filed to obtain this Grant Agreement;

3. Failure to operate or maintain project in accordance with this Grant Agreement.
4. Failure to make any remittance required by this Grant Agreement.
5. Failure to comply with Labor Compliance Plan requirements.

6. Failure to submit timely progress reports.
7. Failure to routinely invoice State.
8. Failure to meet any of the requirements set forth in Paragraph 13, “Continuing Eligibility.”

Should an event of default occur, State shall provide a notice of default to the Grantee and shall give
Grantee at least ten (10) calendar days to cure the default from the date the notice is sent via first-class
mail to the Grantee. If the Grantee fails to cure the default within the time prescribed by the State, State
may do any of the following:

9. Declare the funding be immediately repaid, with interest, which shall be equal to State of California
general obligation bond interest rate in effect at the time of the default.

10. Terminate any obligation to make future payments to Grantee.
11. Terminate the Grant Agreement.
12. Take any other action that it deems necessary to protect its interests.

In the event State finds it necessary to enforce this provision of this Grant Agreement in the manner
provided by law, Grantee agrees to pay all costs incurred by State including, but not limited to, reasonable
attorneys' fees, legal expenses, and costs.

Yucaipa Groundwater Sustainability Agency - March 14, 2018 - Page 8 of 226