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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 03/16/1999 - RESOLUTION NO. 16 AUTHORIZING THE BOARDS CHAIRPERS AGENDA ITEM SUMMARY ITEM NUMBER: 7 FORT COLLINS CITY COUNCIL DATE: March 16, 1998STAFF• John Fischbach SUBJECT : Resolution No. 16 Authorizing the Board's Chairperson and Secretary to Execute a Promissory Note Payable to, and a Deed of Trust for the Benefit of, the City of Fort Collins. RECOMMENDATION: Staff recommends adoption of the Resolution. EXECUTIVE SUMMARY: The Fort Collins Housing Authority was recently involved in litigation filed in the United States District Court for the District of Colorado, known as Carter-DeFrancesco v. Housing Authority of the City of Fort Collins, et al. A judgment was entered in the lawsuit against the Authority,its previous executive director and one of its former commissioners. On January 19, 1999,the Authority's Board of Commissioners adopted Resolution No. 15 authorizing the Authority, with assistance from the City of Fort Collins, to settle the lawsuit under a structured, eight-year payment schedule or to pay the plaintiff a lump-sum amount representing the present value of the structured payment schedule at a 5%discount rate,which would be$433,529. Also,on January 19, 1999, the Fort Collins City Council adopted Emergency Ordinance No. 14, 1999, authorizing the City to advance to the Authority the funds it needed to settle the lawsuit as authorized by the Board in Resolution No. 15. On January 21, 1999,the plaintiff in the lawsuit accepted the Authority's offer of settlement and,as a result,the Authority paid the plaintiff$433,529 in full and complete settlement of the lawsuit. Emergency Ordinance No. 14, 1999,provided that the City Manager,in advancing the$433,529 to the Authority,shall require the Authority to execute and deliver to the City such documents of indebtedness and to provide such security as the City Manager deems reasonable and appropriate. As a result, the City Manager has presented to the Authority, for its approval, a Promissory Note in the original principal amount of$433,529. (A copy of the Promissory Note is attached as Exhibit "A" to the Resolution.) The City Manager is also asking that the Promissory Note be secured by a Deed of Trust. (A copy of the Deed of Trust is attached as Exhibit "B" to the Resolution.) The Deed of Trust encumbers certain real properties currently owned by the Authority that are commonly known as 2217 West Elizabeth, 1400 Riverside Drive, 1204-06 and 1208-10 Castlerock Drive,and 517'/z East Prospect Road and that are all located in Fort Collins. • RESOLUTION NO. 16 OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS HOUSING AUTHORITY AUTHORIZING THE BOARD'S CHAIRPERSON AND SECRETARY TO EXECUTE A PROMISSORY NOTE PAYABLE TO, AND A DEED OF TRUST FOR THE BENEFIT OF, THE CITY OF FORT COLLINS WHEREAS,the Fort Collins Housing Authority("the Authority")was recently involved in litigation filed in United States District Court for the District of Colorado, known as Carter- DeFrancesco v. Housing Authority of the City of Fort Collins, et al., Civil Action No. 97-K-1995 ("the Lawsuit"); and WHEREAS, judgment was entered in the Lawsuit against the Authority, its previous executive director and one of its former commissioners; and WHEREAS, on January 19, 1999, the Authority's Board of Commissioners ("the Board") adopted Resolution No. 15 authorizing the Authority,with assistance from the City of Fort Collins ("the City"), to settle the Lawsuit under a structured, eight-year payment schedule or to pay the plaintiff a lump-sum amount representing the present value of the structured payment schedule at a 5% discount rate, which would be $433,529; and • WHEREAS, on January 19, 1999, the Fort Collins City Council adopted Emergency Ordinance No. 14, 1999,authorizing the City to advance to the Authority the funds it needed to settle the Lawsuit as authorized by the Board in Resolution No. 15; and WHEREAS,on January 21, 1999,the plaintiff in the Lawsuit accepted the Authority's offer of settlement and, as a result, the Authority paid the plaintiff $433,529 in full and complete settlement of the Lawsuit; and WHEREAS,the City's Emergency Ordinance No. 14, 1999,provides that the City Manager, in advancing the$433,529 to the Authority,shall require the Authority to execute and deliver to the City such documents of indebtedness and to provide such security as the City Manager deems reasonable and appropriate; and WHEREAS,the City Manager has presented to the Authority,for its approval,a Promissory Note in the original principal amount of$433,529, a copy of which Promissory Note is attached hereto as Exhibit A and incorporated herein by reference ("the Promissory Note"); and WHEREAS, the City Manager is also requesting that the Promissory Note be secured by a Deed of Trust,a copy of which Deed of Trust is attached hereto as Exhibit B and incorporated herein by reference ("the Deed of Trust"); and • WHEREAS, the Deed of Trust encumbers those real properties currently owned by the Authority,commonly known as 2217 W.Elizabeth Street, 1400 Riverside Drive, 1204-06 and 1208- 10 Castlerock Drive, and 517 `/2 East Prospect Road, all located in Fort Collins, Colorado. NOW, THEREFORE, BE IT RESOLVED BY THE FORT COLLINS HOUSING AUTHORITY BOARD OF COMMISSIONERS, that Ann Azari, Chairperson of the Board, and John F.Fischbach,Secretary of the Board,are hereby authorized to execute the Promissory Note and the Deed of Trust on behalf of the Housing Authority,and to cause the Deed of Trust to be recorded in the office of the Latimer County Clerk and Recorder promptly after its execution. Passed and adopted at a regular meeting of the Board of Commissioners of the Fort Collins Housing Authority, held this 16th day of March, A.D. 1999. Chairperson ATTEST: Secretary EXHIBIT "A" PROMISSORY NOTE AMOUNT: $433,529 DATE: March 1999 FOR VALUE RECEIVED,the Fort Collins Housing Authority,a Colorado quasi-municipal corporation, ("the Borrower") promises to pay to the City of Fort Collins, Colorado, a municipal corporation,("the Lender"),or order,the principal sum ofFour Hundred Thirty Three Thousand Five Hundred and Twenty Nine Dollars ($433,529), on the following terms: l. Interest Rate. So long as this Promissory Note is not in default,the unpaid principal balance due hereunder shall bear interest from the date of this promissory note until paid at the rate of seven percent (7%) per annum compounded annually. 2. Pavment of Principal and Interest.All or any portion of the principal and interest due hereunder shall be payable upon written demand by the Lender,but in any event,all unpaid principal and interest due hereunder shall become due and payable on March_, 2009 • 3. Form of Payment. All payments of principal,interest,and other amounts due under this Promissory Note shall be payable in lawful money of the United States of America. 4. Place ofPavment. All payments ofprincipal and interest shall be made at City of Fort Collins, Finance Department, 300 Laporte Avenue,Fort Collins, Colorado 80521, or at such other place as the Lender may designate in writing. Payments shall be deemed made only upon receipt by the Lender. 5. Application of Payments. All sums paid hereunder shall be applied first to the repayment of any sums advanced by the Lender for the payment of any taxes,assessments,insurance premiums, or other charges pursuant to the Deed of Trust of even date herewith which secures this Promissory Note("the Deed of Trust"),together with interest thereon from the date of advance until repaid at the defaulting rate below; then to late charges, if any; then to payment of accrued and unpaid interest; and the remainder,if any, shall be applied to the reduction of the unpaid principal. All interest hereunder shall be calculated on the basis of a three hundred sixty-five (365) day year. 6. Securi . This Promissory Note and the indebtedness evidenced hereby, including principal,interest,costs of collection,and all other amounts due hereunder are secured by the Deed of Trust which encumbers the real properties commonly known as 2217 W.Elizabeth Street, 1400 Riverside Drive, 1204-06 and 1208-10 Castlerock Drive,and 517%East Prospect Road(collectively "the Collateral"). Within ninety(90)days after payment in full of this Promissory Note,the holder • Page I of 6 of this Promissory Note shall deliver the original Promissory Note,together with aproperly executed Release of Deed of Trust,to the Borrower. 7. Default. Default shall result upon the occurrence of any one of the following with respect to the Borrower: (a) application for or appointment of a receiver for any of the properties that constitute the Collateral; (b) issuance of an attachment against any of the properties that constitute the Collateral; (c) entry of a judgment against the Borrower, except any judgments currently pending,and the Borrower's failure to satisfy said judgment within fifteen(15)days after the expiration of any applicable stay of execution; (d) failure to pay any tax or tax deficiency when due; (e) dissolution, suspension, or liquidation of the Borrower; (f) the mortgage or pledge of any or all of the Collateral; (g) failure after demand to furnish financial information or to permit inspection of any books or records;(h)the conditions or affairs of the Borrower change such that the Lender, in good faith,regards the Borrower's ability to repay this Promissory Note to be impaired; (i) commencement of any proceedings under any bankruptcy or insolvency laws against the Borrower;0)waste or destruction of the Collateral;(k)the sale,transfer,or conveyance of all or any interest in the Collateral without the consent of the Lender; (1) any representation false in any material respect made or furnished to the Lender by or on behalf of the Borrower in connection with the loan evidenced by this Promissory Note; (m)failure to make any payment required to be made pursuant to the terms of this Promissory Note within ten(10)days of the date due; or(n)failure to correct any default under the Deed of Trust within ten(10)days after written notice of such default to the Borrower. 8 Remedy. Upon default, the entire unpaid principal sum, accrued interest, other amounts due under this Promissory Note, and all other obligations, direct or contingent, of the Borrower due to the Lender shall at once become due and payable without further notice, at the option of the Lender. 9. Pre_pavment. This Promissory Note may be prepaid,in whole or in part, at any time without penalty. 10. Waiver. The Borrower waives demand;presentment for payment;protest;notice of dishonor, of protest, of demand, of nonpayment, and of maturity; and diligence in collecting or bringing suit against any patty liable hereon;and further agrees to any and all extensions,renewals, modifications,partial payments, substitutions of evidence of indebtedness,the taking or release of any security or collateral, or the release of any party liable hereon,with or without notice before or after maturity. 11. Expenses and Costs of Collection. In the event this Promissory Note is placed in the hands of an attorney for collection or suit is filed hereon; or if proceedings are commenced to foreclose any instruments securing this Promissory Note;or if proceedings are had in bankruptcy, receivership, reorganization, or other legal or judicial proceedings for the collection of this Page 2 of 6 Promissory Note or the foreclosure of any instrument securing this Promissory Note;or in the event the Lender is made a party to any litigation or any litigation is threatened as a result of the existence of any instrument securing this Promissory Note, the Borrower agrees to pay to the Lender all expenses and costs of collection incurred by the Lender in connection with any such collection,suit, or proceeding, in addition to the principal and interest then due, which expenses and costs of collection shall include,by example and not limitation,the following: attorney's fees;receiver's fees and costs; public trustee's fees and costs; appraisal fees; property inspection fees; environmental audits; loan servicing fees; expert witness fees; deposition costs; filing fees; the cost of mailing or serving process, notices, and other documents; copy costs; and title insurance premiums or abstracting charges. All expenses and costs of collection shall be paid at the time of and as a condition precedent to the curing of any default in the payment of this Promissory Note. The Borrower and any surety,endorser, guarantor,or accommodation party hereon further agree to pay to the Lender all expenses and costs, including attorney's fees, incurred by the Lender in collecting any judgment entered on this Promissory Note. 12. Colorado Law to ARply. Regardless of the place of execution,this Promissory Note shall be governed by and construed in accordance with the laws of the State of Colorado, and all obligations of the Borrower created hereunder are performable in Larimer County, Colorado. 13. Late Payment Penalties. The Borrower acknowledges that if any payment under this Promissory Note is not made when due, the Lender will, as a result thereof, incur costs not contemplated by this Promissory Note,the exact amount of which would be extremely difficult or impractical to ascertain. The Borrower therefore hereby agrees that,in the event the Borrower fails to make any payment required to be made pursuant to the terms of this Promissory Note within ten (10)days of the date such payment is due,the Borrower shall be obligated to pay to the Lender a late payment penalty in an amount equal to ten percent(10%) of the delinquent payment. Only one late payment penalty shall be required to be made for each payment which is not made within ten(10) days of the date such payment is due. All late payment penalties shall be paid at the time of,and as a condition precedent to,the curing of any default. This provision for late payment penalties shall not constitute an extension of the due date for any payment required to be made pursuant to the terms of this Promissory Note, nor shall it be considered a waiver of the right of the Lender to require payments to be made when due. 14. Defaulting Interest. Upon default,in addition to the late payment penalties set forth in the preceding paragraph,the unpaid principal,defaulting interest,and all other amounts due under this Promissory Note or any instrument securing this Promissory Note,including costs and expenses of collection and amounts advanced to protect the Collateral,shall bear interest at a rate equal to the nondefaulting interest rate set forth above in paragraph 1 plus five percent (5%) per annum, compounded annually,from the date of default until paid in full. All defaulting interest shall be paid at the time of, and as a condition precedent to, the curing of any default. This provision for • defaulting interest shall not constitute an extension of the due date for any payment required to be Page 3 of 6 made pursuant to the terms of this Promissory Note;nor shall it be considered a waiver of the right of the Lender to require payments to be made when due. 15. No Waiver. No failure on the part of the Lender to exercise, and no delay in exercising,any right which the Lender may have hereunder shall operate as a waiver of such right; nor shall any,single or partial exercise by the Lender of any right hereunder preclude the exercise of any other right. 16. Bankruntcy. Notwithstanding the full payment of all obligations due to the Lender under and pursuant to the terms of this Promissory Note,in the event of bankruptcy,either voluntary or involuntary, or of any other action of insolvency or debtor relief in which the Borrower may be involved pursuant to federal or state law,under such terms and conditions as to cause any payments made by the Borrower to the Lender to be deemed a preferential or voidable payment, then in that event,the Borrower shall remain and shall be fully and completely liable and obligated to the Lender upon demand for the repayment of any sums which the Lender may be obligated to make to any bankruptcy court, trustee in bankruptcy, receiver, or other third party pursuant to any such bankruptcy or insolvency laws or provisions plus interest at the rate herein set forth from the date of notice to the date of payment. This provision shall be applicable notwithstanding the prior payment in full of said obligations, the cancellation of this Promissory Note, and/or the release of any Collateral which the Lender may have held to secure the repayment of the obligation represented hereby. The Borrower acknowledges that this agreement is a material part of the consideration, in exchange for which the Lender has agreed to extend the above-described credit for and at the rates and terms herein set forth. 17. Remedies Cumulative. The remedies provided in this Promissory Note and any instruments securing this Promissory Note shall be cumulative and not exclusive of any remedies provided by law. 18. Modification. This Promissory Note may not be amended, altered, changed, or modified, nor shall any waiver of any provision hereof be effective, except by an instrument in writing signed by the party against whom enforcement of any waiver, amendment, change, modification, or discharge is sought. 19. Clerical Errors. In the event the Lender at any time discovers that this Promissory Note or the Deed of Trust or any other document related to this loan (collectively "the Loan Documents")contains an error which was caused by a clerical mistake,calculation error,computer error,printing error,or similar error,the Borrower agrees,upon notice from the Lender,to re-execute any Loan Documents that are necessary to correct any such error(s)and also agrees that the Borrower will not hold the Lender responsible for any damage to the Borrower which may result from any such error(s). Page 4 of 6 20. Successors and Assians. The Borrower and any endorsers, guarantors, or accommodation parties shall be jointly and severally liable for the payment of the indebtedness evidenced hereby. All of the covenants, obligations, promises, and agreements contained in this Promissory Note made by the Borrower shall be binding upon the Borrower and any guarantors, endorsers, or accommodation parties,their heirs,personal representatives,successors, and assigns. In the event the Collateral or any interest therein is sold, transferred, or conveyed by the Borrower and in the event the Lender consents to such transfer in writing,the transferee of the Collateral shall be deemed to have assumed all of the obligations of the Borrower under this Promissory Note, whether or not the instrument evidencing such conveyance expressly so provides,and whether or not a written assumption agreement is entered into between the Lender and the transferee of the Collateral. The transfer of the Collateral shall not, in any way, alter or discharge the Borrower's liability under this Promissory Note,but the Lender may,without further notice to the Borrower,deal with the transferee of the Collateral in the same manner as with the original Borrower. 21. Notice. Any notice required or desired to be given by the parties hereto shall be in writing and may be personally delivered or mailed,certified mail,return receipt requested. Any such notice shall be deemed given when personally delivered or, if mailed, three(3)business days after deposit in the United States mail, postage prepaid. The addresses for the delivering or mailing of notices shall be as follows: (a) If to the Lender, to: City Manager City of Fort Collins 300 Laporte Avenue Fort Collins, Colorado 80521 (b) If to the Borrower, to: Executive Director Fort Collins Housing Authority 1715 West Mountain Avenue Fort Collins, Colorado 80521 Notices of assignment of this Promissory Note by the Lender or of a change of address of either party shall be given in the same manner as all other notices as hereinabove provided. Page 5 of 6 EXECUTED in the City of Fort Collins, County of Larimer, State of Colorado, this day of March, 1999. Fort Collins Housing Authority, a Colorado quasi-municipal corporation By: Ann Azari, Chairperson ATTEST: By: John F. Fischbach, Secretary Page 6 of 6 . EXHIBIT "B" DEED OF TRUST THIS INDENTURE is made this_day of March, 1999,by and between the Fort Collins Housing Authority,a Colorado quasi-municipal corporation,whose address is 1715 West Mountain Avenue, Fort Collins, Colorado, 80521, ("the Grantor"), and the Public Trustee of the County of Larimer, State of Colorado ("Public Trustee"). WITNESSETH: WHEREAS, the Grantor has executed a promissory note dated March 1999, for the principal sum of Four Hundred Thirty Three Thousand Five Hundred and Twenty Nine Dollars ($433,529), payable to the order of the City of Fort Collins, Colorado, a municipal corporation, whose address is 300 LaPorte Avenue, Fort Collins, Colorado, 80521 ("the Beneficiary"),after the date hereof,with interest thereon from the date thereof at the rate of seven percent(7%)per annum, payable in whole or part upon demand,but in any event due and payable in full on January_,2009; and. WHEREAS,the Grantor is desirous of securing payment of the principal and interest of said promissory note in whose hands soever the said note may be. NOW,THEREFORE,the Grantor,in consideration of the debt,trust and agreements herein described,does hereby grant,bargain, sell, and convey unto the said Public Trustee in trust forever, the following described properties, situate in the County of Larimer, State of Colorado,to wit: PARCEL I A PORTION OF LOT 12 OF THE REPLAT OF TRACT "B" OF REPLAT OF MILLER BROTHERS FOOTHILLS SUBDIVISION, SIXTH FILING, CITY OF FORT COLLINS, COUNTY OF LARIMER, STATE OF COLORADO, WHICH BEGINS AT THE SOUTHEAST- ERLY CORNER OF SAID LOT 12 AND RUNS THENCE S 89022-20" W, 131.14 FEET; THENCE N 00037'40" W, 309.45 FEET; THENCE S 89°43'30" E, 136.00 FEET; THENCE S 00°16'30" W, 307.35 FEET TO THE POINT OF BEGINNING. ALSO DESCRIBED AS: CONDOMINIUM UNITS 101-108 INCLUSIVE, CONDOMINIUM UNITS 201-208 INCLUSIVE, CONDOMINIUM UNITS 301-308, INCLUSIVE, ACCORDING TO THE CONDOM TIUM DECLARATION FOR STADIUM APARTMENTS - WEST CONDOMINIUM ASSOCIATION,RECORDED AUGUST 24, 1978,IN BOOK 1885 AT PAGE 84,AND THE CONDOMINIUM MAP RECORDED AUGUST 24, 1978,IN BOOK 1885 AT PAGE 83, COUNTY OF LARIMER, STATE OF COLORADO. ALSO KNOWN BY STREET AND NUMBER AS 2217 W. ELIZABETH STREET, FT. COLLINS, CO 80526 PARCEL 2 LOT 1, PEVERLEY'S RIVERSIDE SUBDIVISION, COUNTY OF LARIMER, STATE OF COLORADO. ALSO KNOWN BY STREET AND NUMBER AS 1400 RIVERSIDE DRIVE,FORT COLLINS, COLORADO 80524 PARCEL 3 LOTS 4 AND 69,MILLER BROTHERS'SOUTH FOOTHILLS SUBDIVISION,THIRD FILING, ACCORDING TO PLAT FILED JULY 18, 1960, IN THE CITY OF FORT COLLINS, COLORADO. ALSO KNOWN BY STREET AND NUMBER AS 1204-06 1208-10 CASTLEROCK DRIVE, FORT COLLINS, CO 80521 PARCEL 4 LOT 2, HOLSINGER FIRST SUBDIVISION, CITY OF FORT COLLINS, COUNTY OF LARIMER, STATE OF COLORADO. ALSO KNOWN BY STREET AND NUMBER AS 517% EAST PROSPECT ROAD, FORT COLLINS, COLORADO 80525 TO HAVE AND TO HOLD the same, together with all and singular the privileges and appurtenances thereunto belonging: In trust nevertheless,that in case of default in the payment of said note, or any part thereof, or in the payment of the interest thereon according to the tenor and effect of said note, or in the payment of any prior encumbrances,principal,or interest, if any,or in case default shall be made in or in case of violation or breach of any of the terms, conditions, covenants, or agreements herein contained, the Beneficiary hereunder or the legal holder of the indebtedness secured hereby may declare a violation of any of the covenants herein contained and may elect to advertise said properties for sale,and demand such sale by filing a notice of election and demand for sale with the Public Trustee. Upon receipt of such notice of election and demand for sale,the Public Trustee shall cause a copy of the same to be recorded in the recorder's office of the county in which said properties are situated. The Public Trustee shall then give public notice of the time and place of sale by advertisement to be published for four weeks (once each week for five successive weeks)in some newspaper of general circulation at that time published in the county or counties in which said properties are located. A copy of such notice shall be mailed within ten(10) 2 • days after the date of the first publication thereof to the Grantor at the address given herein,to such persons appearing to have acquired a subsequent record interest in said properties at the address given in the recorded instrument, and to any other persons as may be provided by law. It shall and may then be lawful for the Public Trustee to sell said properties for the highest and best price the same will bring in cash and to dispose of the same(en masse or in separate parcels,as the said Public Trustee may think best),together with all the right,title,and interest of the Grantor therein,at public auction at any place as may be specified by statute and designated in the notice of sale. The Public Trustee shall make and give to the purchaser of such properties at such sale a certificate in writing containing: a description of such properties purchased;the sum paid therefor;a statement that said purchaser shall be entitled to a deed therefor, unless the same shall be redeemed as is provided by law; and in the event of a continuance of the sale, a recital that the sale was duly continued. The Public Trustee shall,upon demand by the person holding the said certificate of purchase,when said demand is made or upon demand by the person entitled to a deed to and for the properties purchased at the time such demand is made,the time for redemption having expired,make and execute to such person a deed to the said properties purchased. Said deed shall be in the ordinary form of a conveyance and shall be signed, acknowledged, and delivered by the said Public Trustee and shall confirm the foreclosure sale and sell and convey to such person entitled to such deed the properties purchased as aforesaid and all the right, title, interest, benefit, and equity of redemption of the Grantor therein. The Public Trustee shall,out of the proceeds or avails of such sale,after first paying and retaining all fees,charges,and costs of making said sale,pay to the Beneficiary hereunder or the legal holder of said note the principal and interest due on said note according to the tenor and effect • thereof, and all monies advanced by such Beneficiary or legal holder of said note for insurance, taxes, and assessments, with interest thereon at twelve percent (12 %) per annum, rendering the overplus, if any, unto those persons entitled thereto as a matter of law. Said sale and said deed so made shall be a perpetual bar, both in law and equity, against the Grantor and all other persons claiming the said properties,or any part thereof,by,from,through,or under the Grantor. The holder of said note may purchase said properties or any part thereof;and it shall not be obligatory upon the purchaser at any such sale to see to the application of the purchase money. And the Grantor covenants and agrees to and with the Public Trustee that at the time of the ensealing of and delivery of these presents he is well seized of the said land and tenements in fee simple and has good right, full power, and lawful authority to grant, bargain, sell, and convey the same in the manner and form as aforesaid; hereby fully and absolutely waiving and releasing all rights and claims he may have in or to said lands, tenements, and properties as a Homestead Exemption,or other exemption,under and by virtue of any act of the General Assembly of the State of Colorado, or as any exemption under and by virtue of any act of the United States Congress now existing or which may hereafter be passed in relation thereto and that the same are free and clear of all liens and encumbrances whatever, except those currently of record, and the above-bargained properties in the quiet and peaceable possession of the Public Trustee against all and every person or persons lawfully claiming or to claim the whole or any part thereof, the Grantor shall and will WARRANT AND FOREVER DEFEND. Until payment in full of the indebtedness, the Grantor shall timely pay all taxes and assessments levied on the properties; any and all amounts due on account of principal and interest 3 or other sums on any senior encumbrances, if any; and will keep all improvements that may be on said lands insured against any casualty loss, including extended coverage, in a company or companies meeting the net worth requirements of the Beneficiary hereof in an amount which will yield to the holder of the indebtedness, after reduction by co-insurance provisions of the policy, if any,not less than the then total indebtedness. Each policy shall contain a loss payable clause naming the Beneficiary as mortgagee and shall further provide that the insurance may not be cancelled upon less than ten (10) days' written notice to the Beneficiary. At the option of the Beneficiary, the original policy or policies of insurance shall be delivered to the Beneficiary as further security for the indebtedness. Should the Grantor fail to insure and deliver the policies or to pay taxes or assessments as the same fall due,or to pay any amounts payable upon senior encumbrances,if any, the Beneficiary may make any such payments or procure any such insurance,and all monies so paid, with interest thereon at the rate of twelve percent(12%)per annum, shall be added to and become a part of the indebtedness secured by this Deed of Trust and may be paid out of the proceeds of the sale of the properties if not paid by the Grantor. In addition, and at its option,the Beneficiary may declare the indebtedness secured hereby and this Deed of Trust to be in default for failure to procure insurance or make any of the payments required by this paragraph. If all or any part of the properties or an interest therein is sold or transferred by the Grantor without the Beneficiary's prior written consent, excluding(a)the creation of a lien or encumbrance subordinate to this Deed of Trust, (b) the creation of a purchase money security interest for household appliances, (c) a transfer by devise, descent, or by operation of law upon the death of a joint tenant, or (d) the grant of any leasehold interest of three (3) years or less not containing an option to purchase,the Beneficiary may,at the Beneficiary's option,declare all the sums secured by this Deed of Trust to be immediately due and payable. The Beneficiary shall have waived such option to accelerate if, prior to the sale or transfer, the Beneficiary and the person to whom the property is to be sold or transferred reach agreement in writing that the credit of such person is satisfactory to the Beneficiary and that the interest payable on the sums secured by this Deed of Trust shall be at such rate as the Beneficiary shall request. AND THAT IN CASE OF ANY DEFAULT whereby the right of foreclosure occurs hereunder, the holder of said note or certificate of purchase shall at once become entitled to the possession, use, and enjoyment of the properties aforesaid, and to the rents, issues, and profits thereof,from the accruing of such right and during the pendency of foreclosure proceedings and the period of redemption, if any there be; and such possession shall at once be delivered to the holder of said note or certificate of purchase on request,and on refusal,the delivery of such possession may be enforced by the holder of said note or certificate of purchase by any appropriate civil suit or proceeding,and the holder of said note or certificate of purchase,or any thereof, shall be entitled to a receiver for said properties, and of the rents, issues, and profits thereof, after such default, including the time covered by foreclosure proceedings and the period of redemption,if any there be, and shall be entitled thereto as a matter of right without regard to the solvency or insolvency of the Grantor or of the then owner of said properties and without regard to the value thereof, and such receiver may be appointed by any court of competent jurisdiction upon ex parte application and without notice—notice being hereby expressly waived—and all rents, issues, and profits, income, 4 . and revenue therefrom shall be applied by such receiver to the payment of the indebtedness hereby secured, according to the law and the orders and directions of the court. AND, that in the case of default in any of said payments of principal or interest, according to the tenor and effect of said promissory note or any part thereof, or of a breach or violation of any of the covenants or agreements herein, by the Grantor, then and in that case the whole of said principal sum hereby secured and the interest thereon to the time of the sale may at once, at the option of the legal holder thereof, become due and payable, and the said properties be sold in the manner and with the same effect as if said indebtedness had matured,and that if foreclosure be made by the Public Trustee, an attorney's fee of a reasonable sum for services in the supervision of said foreclosure proceedings shall be allowed by the Public Trustee as a part of the cost of foreclosure, and if foreclosure be made through the courts,a reasonable attorney's fees shall be taxed by the court as a part of the cost of such foreclosure proceedings. IT IS FURTHER UNDERSTOOD AND AGREED that if a release of this Deed of Trust is required, the Grantor will pay the expense thereof;that all the covenants and agreements herein contained shall extend to and be binding upon the heirs,personal representatives, successors, and assigns of the respective parties hereto; and that the singular number shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders. EXECUTED this day of March, 1999. • Fort Collins Housing Authority, a Colorado quasi-municipal corporation By: Ann Azari, Chairperson ATTEST: By: John F. Fischbach, Secretary 5 STATE OF COLORADO ) ss. COUNTY OF LARIMER ) The foregoing instrument was subscribed, sworn to, and acknowledged before me this day of March, 1999,by Ann Azari as Chairperson and John F. Fischbach as Secretary of the Fort Collins Housing Authority Board of Commissioners. Witness my hand and official seal. My commission expires: Notary Public i I I I 6