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Home My WebLink About790418.tiff 11/27/79 • LOAN AGREEMENT BETWEEN COUNTY OF WELD, COLORADO AND CASTLE REAL ESTATE COMPANY Dated : December , 1979 The interest of the County of Weld, Colorado in this Loan Agreement has been assigned to The Empire Savings , Building and Loan Association, pursuant to an As_ignment attached hereto of even date. 7004.18 TABLE OF CONTENTS (This Table of Contents is for convenience of reference only and i$ not a part of the Loan Agreement. ) ARTICLE I DEFINITIONS, EXHIBITS AND RULES OF INTERPRETATION SECTION 1 .01 . Definitions 1 SECTION 1 .02. Exhibit 3 SECTION 1 .03. Rules of Interpretation 3 ARTICLE II REPRESENTATIONS SECTION 2.01 . Representations by the County SECTION 2.02. Representations by the Borrower S ARTICLE IUII THE LOAN SECTION 3.01 . Amount and Source of Loan; Repayment 6 SECTION 3 .02. Burrower ' s Obligations Unconditional 3 SECTION 3 .03. Borrower ' s Remedies ARTICLE IV BORROWER 'S COVENANTS SECTION 4.01 . Financial Statements S SECTION 4.02. Indemnity ii SECTION 4.03. Continuing Existence and Cualification '3 SECTION 4.04. Reports to Governmental Agencies 10 SECTION 4.05 . Mortgage of Project 10 SECTION 4.06. Construction of Improvements 10 SECTION 4.07. Preservation of Tax Exemption 10 SECTION 4.08. Lease or Sale of Project 12 SECTION 4.0'3. Project Operation and Maintenance Expenses 12 ARTICLE V BORROWER ' S OPTIONS SECTION 5.01 . Prepayments 13 SECTION 5.02. Extraordinary Prepayments 13 ARTICLE VI EVENTS OF DEFAULT AND REMEDIES SECTION 6.01 . Events of Default 13 SECTION 6.02. County ' s Remedies 14 SECTION E..03. Disposition of Funds IS SECTION 6.04. Manner of Exercise 15 SECTION 6.05. Attorney ' s Fees and Expenses 15 SECTION 6.06. Effect on Waiver 1E6 ARTICLE VII GENERAL SECTION 7.01 . Notices 16 SECTION 7.02. Binding Effect 1E• iii SECTION 7.03. Seaerability 16 SECTION 7.04. Amendments , Changes and Modifications 17 SECTION 7.05. Execution Counterparts 17 SECTION 7.05. Limitation of County ' s Liability 17 SECTION 7.07. Assignment by County 17 TESTIMONIUM 12 SIGNATURES AND SEALS 12 ASS I GNMENT 19 EXHIBIT THIS LOAN AGREEMENT is dated as of December __, 1' 7'S, and is by and between the County of Weld, a political subdivision in the State of Colorado, called herein the "County , " and Castle Real Estate Company, a Colorado limited partnership , called herein the "Borrower . " WITNESSETH that the County and the Borrower, each in consideration of the representations , covenants and agreements of the other as set forth herein, mutually represent, covenant and agree as follows: ARTICLE I DEFINITIONS, EXHIBITS AND RULES OF INTERPRETATION Section 1 .01 . faiii.Qa . In this Agreement the follow- ing terms have the following respective meanings unless the context hereof clearly requires otherwise: • ( 1 ) 8s.±: The County and Municipality Development Revenue Bond Act, Article 3, Title 2'3, Colorado Revised Statutes 19,73 , as amended. (2) 65.1l9DIDEIli_Q£...Laaaaa_s nsi_Etn a: The agreement, of even date herewith between the Borrower and the Lender assign- ing the issues , property and rents derived from the Project to the Lender to secure repayment of the Bond and interest thereon . (3) UQT1d: The Industrial Development Revenue Bond 'Castle Real Estate Company Project) to be issued by the County pursu- ant to the Ordinance. (4) 5.2CLQW : Castle Real Estate Company, a Colorado limited partnership , its successors and assigns, and any sur- viving , resulting or transferee business entity which may assume its obligations in accordance with the provisions of this Agreement. 2 (5) @saczawaz_at .cr-. u. a4lYt: A person designated to act on behalf of the Borrower , as evidenced by a written certif- icate furnished to the County and the Lender , containing the specimen signature of such person and signed for the Borrower by its general partner . (6) cjsains_QL₹a: The date on which the executed Bond is delivered. (7) CL2nfaual a_aaa.#;s: All costs paid to acquire, con- struct and complete the Land and the Improvements including , but not limited to, site preparation costs , architectural fees , engineering fees, all costs' of labor, material and services and all issuance expenses paid or incurred by the Borrower . (8) EQunami. An attorney designated by or acceptable to the Lender , duly admitted to practice law before the highest court of any state; an attorney for the Borrower or the County may be eligible for appointment as Counsel . .('3) Qqun±: The County of Weld , Colorado, its successors and assigns . ( 10) c..QLLnuY_6kkEg.aal 1:a±iya: The County Finance Director cr any person appointed in writing by the Chairman of the Board of County Commissioners. ( 11 ) Eyani_ui_Q±faul±: Any of the events described in Section 6.01 hereof . ( 12) 1`mulsrxkmen;s: The structures and other improvements ; including any tangible personal property, to be constructed or installed by the Borrower on the Land in accordance with the Plans and Specifications. ( 13) .giniacna1_Egyanua_Cstss: The Internal Revenue Code of 1954, as amended. ( 14) Lausl: The real property and any other easements and rights described in Exhibit A. ( 15) L...2115[111: The Empire Savings , Building and Loan Asso- ciation, in Denver, Colorado, its successors and assigns . 3 ( 16) 162LiC.1.L3a: The Deed of Trust of even date herewith from the Borrower , as grantor , in favor of the Lender , as beneficiary, to secure payment of the Bond and interest thereon . ( 17) Ugi,.eumezda: With respect to any insurance payment or condemnation award, the amount remaining therefrom after payment of all expenses incurred in the collection thereof. ( 18) QL≤innnlg: The ordinance of the County, adopted November 28, 1979, authorizing the issuance and sale of the Bond. ( 19) elans.-.aIIsl_Ek ifitaii r : The plans and specifica- tions for the construction and installation of the Improve- ments , which are approved by the Lender , together with such modifications thereof and additions thereto as are reasonably determined by the Borrower to be necessary or desirable for the completion of the Improvements and are approved by the Lender . (20) EzinLikal_aalanLg: So much of the principal sum on the Bond as from time to time remains unpaid. (21 ) elled L±: The Land and the Improvements as they may at any time exist. Section 1 .02. Exhibi±. Attached hereto as Exhibit A and incorporated herein by reference is a legal description of the Land. Section 1 .03. au1L1_2±._..III .. L'aLt,iaiisul ( 1 ) This Arareernen't shall be interpreted in accordance with and governed by the laws of the State of Colorado; (2) The words "herein" and "hereof" and words of simlar import, without reference to any particular section or subdivi- sion, refer to this Agreement as a whole rather than to any particular section or subdivision hereof; (3) References herein to any particular section or subdi- vision hereof are to the section or subdivision of this instru- ment as originally executed; (4) Where the Borrower is permitted or required to do or accomplish any act or thing hereunder , the Borrower may cause the same to be done or accomplished by an agent or employee with the same force and effect as if done or accomplished by the Borrower ; and (S) The Bond is secured by the Mortgage , a Security Agreement and Financing Statement and an Assignment of Leases and Rents , all of even date herewith. For the purpose of Lender ' s rights and remedies and Borrower ' s duties and obliga- tions to Lender , and in the event of a conflict in terms among the various documents , preference in enforcement shall be given to the terms of the documents in the following order : the Bond, the Mortgage, the Assignment of Leases and Rents, the Security Agreement and Financing Statement and this Loan Agreement . This paragraph is not intended to preclude the pursuit of alternative or concurrent remedies available to Lender under the various documents . ARTICLE II REPRESENTATIONS Section 2.01 . BERLaaenjaijsms_x_itt _County. The County makes the following representations as the basis for its cove- nants herein: ( 1 ) the Project as described and planned constitutes a "Project" within the meaning of Section 103 of the Act (2) in authorizing the Project the County ' s purpose is , and in its judgment the effect thereof will be, the promotion of industry and development of trade and other economic activities by inducing the Borrower and other profit or nonprofit corporations , commercial or business enterprises to locate, expand or remain in the County; tte mitigate the threat of unemployment; and to secure and maintain a balanced and stable economy within the County; (3) the issuance and sale of the Bond, the execution and delivery of this Agreement ( including the assignment hereof ) and the performance of all covenants and agree- ments of the County contained in this Agreement, and of all other acts and things required, under the Constitution and laws of the State of Colorado and the County ' s Home Rule Charter to make this Agreement and the Bond valid and S binding obligations of the County in accordance with their terms, are authorized by the Act and have been duly authorized by an Ordinance of the Board of County Commis- sioners of the County duly adopted at a meeting thereof duly called and held on November 28, 1S79; (4) to provide funds to be loaned to partially finance the Construction Costs„ the County has duly authorized the issuance of the Bond in the principal amount of $1150,000, to be issued upon the terms set forth in the Ordinance, the provisions of which authorize the assignment of the County ' s interest in this Agreement to the Lender in the Assignment of Loan Agreement as security for the payment of the principal of, premium, if any, and interest on the Bond; (5) pursuant to the Ordinance , the County has authorized and directed the Lender to disburse the pro- ceeds of the Bond directly to the Borrower and such ether parties as may be entitled to payment for- Construction Casts , upon receipt of such supporting documentation as the Lender may deem reasonably necessary; and (6) the Bond is to be issued within the exemption provided under Section 103 (b) (6) (A) of the Internal Reve- nue Code with respect to issues of 51 ,000,000 or less ; provided that nothing herein shall prevent the County from qualifying such Bond under a different exemption if, and to the extent such exemption is permitted by law and consistent with the object and purposes of the Act. Section 2.02. 3,CE,LgaaIIi 'li2mi...Lx_itm_EaLt2wI c• The Borrower makes the following representations as the basis for its covenants herein: ( 1 ) the Borrower is a limited partnership duly organized under the laws of the State of Colorado, is in good standing and has power to enter into this Agrce►nentr the Mortgage and the Assignment of Leases and Rents and to lease the Project as lessor for use fur manufacturing kitchen cabinets ; and by proper partnership action has authorized the execution and delivery of this Agreement, the Mortgage and the Assignment of Leases and Rents ; 6 (2) the execution and delivery of this Agreement , the Mortgage and the Assignment of Leases and Rents , the consummation of the transactions contemplated thereby, and the fulfillment of the terms and conditions thereof do net and will not conflict with or result in a breach of any of the terms or conditions of its partnership agreement or any agreement or instrument to which the Borrower is now a party or by which it, or its property, is bound, and do not and will not constitute a default under any of the foregoing ; (3) the financing of the Project by the County will substantially assist -the Borrower to make available a kitchen cabinet manufacturing facility within the County; (4) the use of the Project for the purpose and in the manner contemplated by this Agreement conforms in all material respects to all presently applicable development, pollution control , water conservation and other laws , regulations, rules and ordinances of the federal govern- ment and the State of Colorado and respective agencies thereof and the political subdivisions in which the Proj- ect is located; (5) neither the Borrower , nor any " related person" (as that terminology is defined by Section 103 (b) (6) (C ) of the Internal Revenue Code and the regulations thereunder ) is or has been a "principal user" of any facility within the County ' s boundaries (other than the Project) or of any "contiguous" or, " integrated facility" located within any bordering "political jurisdiction, " which facility has been acquired or improved in whole or in part, directly or indirectly, from the proceeds of an issue of " industrial revenue bonds ," all within the meaning of Section 103(b ) (6) (B) of the Internal Revenue Code; and (6) adequate private financing for the Project was found by the Borrower to be not reasonably available ; and a major inducement to the Borrower to undertake the Prej:- ect in the area was the source of financing provided under the Act and the assurances the Borrower received from the County that such financing would be made available to the Borrower ; and any Construction Costs heretofore incurred by the Borrower , for which the Borrower shall hereafter seek reimbursement, were incurred in anticipation of 7 reimbursement from the funds to be advanced under the Bond if such funds should become available on terms acceptable to the Borrower, and the Borrower investigated the possi- bility of such financing prior to incurring such Project Costs; and the Borrower did not commence acquisition or construction of the Project prior to February S, 1S7S, the date on which the County gave preliminary approval of the Project and the financing thereof in whole or part through the Bond. ARTICLE III ' THE LOAN Section 3,01 . Eelmunt_au _SQULL .Q±_Lsau1_Euu.aitri,.nt. Th e County agrees to lend the Borrower , upon the terms and condi- tions set forth herein and in the Mortgage, the Security Agreement and the Assignment of Leases and Rents, the proceeds received from the sale of the Bond. Subject to any rights of prepayment granted herein and in the Bond, the Borrower agrees to repay said loan as follows : ( 1 ) On the first day of the calendar month next succeeding the Closing Date and on the first day of each and every month thereafter the Borrower shall pay the sum necessary to amortize the Principal Balance of the Bond in 300 equal installments at an interest rate of 8-1/2% per annum, as provided in the Bond. (2) In the event the Borrower receives from the Lender notice that interest on the Bond is subject to federal or Colorado state income taxation pursuant to a "Determination of Taxability" as defined in Section 4.07(2) , the interest rate on the Bond shall be increased to 11-1/2% per annum pursuant to Section 4.07(3) , and payments under this Section 3.01 shall be made and com- puted as required in Section 4.07(3 ) . (3) On the first day following 15 years after the Closing Date, the Borrower shall pay the entire remaining princpal amount and any interest accrued to the date of such payment shall be due and payable. (4) Until the Bond is entirely paid and satisfied, at which time this Agreement will automatically terminate, the Borrower shall pay monthly at the same time its other payments are made an additional amount equal to 1/12th of the annual estimated real estate taxes (as projected by the Lender ) on the Project and the Project Site. Such tax payments shall be adjusted by the Lender at least annually . • In any event, the payments hereunder shall be sufficient to pay all principal and interest due on the Bond as such principal and interest become due and any premium or penalty, at maturity, upon redemption or othrwisc. The computations set forth herein are based upon a 30-day month and a 360-day year factor , but interest shall be paid on the basis of days the interest actually accrues . All payments shall be mde directly to the Lender at its principal office for the account of the County. The proceeds of the loan under the Bond shall be advanced by the Lender pursuant to the terms and conditions of the letter from -the Lender to the Board of County Commissioners of Weld County, Colorado, and others, dated January 9, 1'?9, a copy of which is attached hereto as exhibit B. Section 3.02. a.QcLaw 'a_alisiiiszna_Ung stnsti±iszn l. A l l paymens required of the Borrower hereunder shall be paid with- out notice or demand and without setoff, counterclaim abate- ment, deduction or defense. The Borrower will not suspend or discontinue any payments , and will perform and observe all of its other agreements in this Agreement, and, except es ex- pressly permitted herein, will not terminate this ^greement for any cause, including but not limited to any acts or circum- stances that may constitute failure of consideration, de truc- tion or damage to the Project, eviction by paramount title, commercial frustration of purpose, bankruptcy or insolvency of the County oir the Lender , change in the tax or other laws or administrative rulings or actions of the United States: of America or of the State of Colorado or any political subdivi- sion thereof, or failure of the County to perform and observe any agreement , whether express or implied, or any duty, liabil- ity or obligation arising out of or connected with this F•.gree-- ment. Section 3.03 . tis<c.L.ftuQ..c.:..5._Eama.lis:a. Nothing contained in this Article shall be construed to release the County from the performance of any of its agreements in this Agreement. ARTICLE IV BORROWER 'S COYENANTS Section 4.01 . Einancial_Etrlismtnil. The Borrower will cause to be prepared annual financial statements of the Bor- rower ( including a balance sheet, statement of income and statement of changes in financial position) in accordance with generally accepted accounting principles , certified by an inde- pendent certified public accountant, and, within 120 days of the close of each fiscal year , will furnish a copy to the Lender . Section 4.02. InsiEwniix. The Borrower will pay , and will protect, indemnify and save the County, its officers , agents and employees harmless from and against all liabilties, losses , damages, costs, expenses ( including attorneys ' fees and expenses) , causes of action, suits, claims, demands and judg- ments of any nature arising from: ( 1 ) arty injury to or death of any person or damage to property in or upon the Project or growing out of or connected with the use, nonuse , condition or occupancy of the Project or a part thereof, (2) violation of any agreement or condition of this Agreement, except by the County; (3) violation of any contract, agreement or re=stric- tion by the Borrower relating to the Project; (4) violation of any law, ordinance or regulation affecting the Project or a part thereof or the ownership ) occupancy or use thereof, or relating to any requirements imposed on the Lender as a financial institution or to any disclosure or registration requirements imposed by any federal or state securities law; and (5) any statement or information relating to the expenditure of the proceeds of the Bond contained in the no arbitrage certificate or similar document furnished by the Borrower to the County which ) at the time made , is misleading , untrue or incorrect in any material respect. Section 4.03. canaiinuina_Exillianar_ansi_aualifiliaiian. The Borrower is and throughout the term of this Agreement will remain duly qualified to do business as a limited partnership 10 duly organized under the laws of the State of Colorado, will maintain its partnership existence, will not sell the Project or otherwise dispose of all or substantially all of is assets , and will not consolidate with or merge into another business entity or permit any other business entity to consolidate with or merge into it unless the consent of the Lender is first secured. Section 4.01 . 3a acia_ia_Lu c LmenfaL©stnLiam. The Borrower will furnish to agencies of the State of Colorado such periodic reports or statements as they may reasonably require of the County or the Borrower throughout the term of this Agreement in connection with the transaction contemplated herein. Copies of such reports will be provided to the County and the Lender . Section 4.0B . n2niai:a2_1af_Ezn.iaLi- As additional secur- ity for the Lender , and to induce the County to issue and deliver the Bond, the Borrower agrees to execute and deliver the Mortgage, the Security Agreement and the Assignment of Leases and Rents to the Lender , which documents shall remain in effect until all payments required hereunder have been made ; and the Borrower will cause to be recorded and filed in the office of the Clerk and Recorder of Weld County , Colorado , the Mortgage, the Security Agreement and Assignment of Leases and Rents , and such other documents as Counsel deems necessary or desirable to perfect or protect the security interest of the Lender in and to the Project. Section 4.06. alulliLus`iipm_Lcf_Imazscykmenia- The Borrower has caused the Improvements to be constructed in accordance with the Plans and Specifications . Section 4.07. et.€tLYaiisalsf_IsIa_ELeMe is3n- ( 1 ) Sub- stantially all of the proceeds of the Bond will be used for the acquisition, construction, reconstruction oi• improvement of land or property of a character subject to the allowance for depreciation within the meaning of Section 103(b) (E.) (A) of the Internal Revenue Code ; the Borrower will not cause the proceeds of the Bond to be used in a fashion which , if such use had been reasonably expected on the date of issuance of the Bond, would have caused such obligation to be an arbitrage bond within the meaning of Section 103(c ) of the Internal Revenue Code and all applicable temporary, proposed or final regulations from time to time promulgated thereunder ; and the Borrower will not 11 otherwise use any of the proceeds of the Bond, or merge or consolidate with, or assign or sell its interests in this Agreement or the Project to any other person or business entity or take or fail to take any action, the effect of which would be to impair the exemption of interest on the Bond from federal or Colorado state income taxation. (2) For the purpose of this Section, a "Determination of Taxability" shall mean the issuance of a statutory notice of deficiency by the Internal Revenue Service, or an order of the Commissioner of Revenue, Colorado Department of Revenue, or a ruling of the National Office or any District Office of the Internal Revenue Service, oi' the Department of Revenue, or a final decision of a court of competent jurisdiction which holds in effect that the interest payable on the Bond is includable in the gross income of the holder (other than a holder who is a "substantial user" of the Project or a "related person" as -ti-hose terms are defined in the Internal Revenue Code) for federal or Colorado state income tax purposes , as the case may be , if the period, if any , for contest or appeal of such action, ruling or decision by the Borrower or the Lender has expired without any such contest or appeal having been properly instituted by the Lender , the Borrower or any other interested party. The expenses of such contest shall be paid by the party initiating the contest and the Borrower shall not be required to contest or appeal any Determination of Taxability. The "Date of Taxability" shall mean that point in time, as speci- fied in the determination, ruling , order or decision, that the interest payable on the Bond becomes includable in the gross income of the holder for federal or Colordo state income tax purposes, as the case may be. (3 ) If the Lender receives notice of a "Determination of Taxability" and delivers to the Borrower a copy of that no=ice, the rate of interest on the Bond shall be automatially increased to an annual rate of 11-1/2% per annum as of the date the notice is received by the Borrower , in which event the amounts payable hereunder by the Borrower shall be adjusted accordingly. In such case, the Borrower agrees also to pay forthwith an additional charge, directly to the Lender , in an amount equal to the aggregate difference between ( i ) the payments actually made to the Lender under Section 3 .01 between the Date of Taxability and the effective date of the rate increase ar►d ( ii) the payments which would have been made duri►►g such period if the increased rate had beer► in effect . 12 Section 4.08. Le.alk_saL_Sala_ai_EmalQL.I. The Borrewcr shall not lease the Project, in whole or part , nor assign its rights under the lease, nor sell the Project in whole or part, without first securing the written consent of the Lender ; provided that in no event shall such lease, assignment or sale impair the validity or tax exempt status of the Bond. The County shall be promptly notified of any such sale, lease or assignment. Section 4.09. lLadsc_lRaLafinn_ansl_daintenanse E4Egul,ax. The Burrower shall pay all expenses of the operation and maintenance of the Project including , but without limita- tion, proper insurance thereon and insurance against all lia- bility fur injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the Project and payable during the term of this Loan Agreement. In particular , and without limitation, the Borrower shall maintain the following insurance on the Project; ( 1 ) Insurance upon the actual cash value of the Project (but in no event less than the cost of paying or redeeming the Principal Balance of the Bonds) as deter- mined by a recognized appraiser or insurer selected by the Borrower and approved by the Lender , against loss or damage by fire, lightning , wind storm, hail , explosion, riots, civil commotion, vandalism, malicious mischief , aircraft, vehicles and smoke with uniform standard . extended coverage endorsement limited only as may be provided in the standard form of extended coverage endorsement in use at the time in the State of Colorado. (2) General accident and public liability insurance to the extent of $500,000 per person and $1 million per accident, against liability for bodily injury including death resulting therefrom, and $500,000 per accident against liability for damage to property , including loss of use thereof , occurring on oe in any way relating to the Project or any part thereof. This Section 4.09 shall be effective notwithstanding anything contained in Section 1 .03(S) hereof. 13 ARTICLE V BORROWER'S OPTIONS Section 5.01 . eLaLaYID.Eni-l.• The Borrower shall have the option to prepay all or a portion of the Principal Balance of the Bond at any time upon 30 days ' written notice to the Lender , provided that the prepayment includes at least 90 days; interest on the amount prepaid, as a premium. No partial prepayment shall change the amount or extend the time of pay- ment of any installment payable under the Bond. Section 5.02. ExItiuL::.l.IIaLY_act2aymanil. Upon the occur- rence of an event of damage, destruction or condemnation of the Project, and in the event restoration is not required or the Borrower does not choose to restore the Project, the Net Proceeds of any insurance or condemnation award shall be applied in prepayment, without a premium, of all or a portion of the Principal Balance of the Bond. No partial prepayment shall change the amount or extend the time of payment of any installment payable under the Bond. ARTICLE VI EVENTS OF DEFAULT ADD REMEDIES Section 6.01 . EYani2 _srf_aaii=1±• Any one or more of the following events is an Event of Default under this Agreement: ( 1 ) if the Borrower shall fail to make any payments required under this Agreement on or before the date that the payment is due and such default continues for 10 days; (2) if the Borrower shall fail to observe and per- form any other covenant, condition or agreement on its part under this Agreement for a period of 30 days after written notice, specifyng such default and requesting that it be remedied , is given to the Borrower by the County or the Lender , unless the Lender shall agree in writing to an extension of such time prior to its expiration, provided , however , that there shall be no grace period for failure by the Borrower to comply with the provisions of Section 4.03 hereof; 14 (3) if the Borrower shall file a petition in bank- ruptcy or for reorganization or for an arrangement pursu- ant to any present or future federal bankruptcy act or under any similar federal or state law, or shall be adju- dicated a bankrupt or insolvent, or shall make an assign- ment for the benefit of its creditors or shall admit in writing its inability to pay its debts generally as they become due, or if a petition or answer proposing the adjudication of the Borrower as a bankrupt or its reorga- nization under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such petition or answer shall not be dis- charged or denied within '30 days after the filing thereof, or a receiver , trustee or liquidator of the Borrower or of all or substantially all of the assets of the Borrower or of the Project shall be appointed in any proceeding brought against the Borrower and shall not be discharged within '30 days after such appointment or if the Borrower shall consent to or acquiesce in such appointment, or if the estate or interest of the Borrower in the Project or a part thereof shall be levied upon or attached in any proceeding and such process' shall not be vacated or dis- charged within 60 days after such levy or attachment) or the Borrower shall be dissolved or liquidated (other than as a result of a merger or consolidation of the Borrower into or with another business entity under the conditions permitting such actions contained in Section 4.0= ) ; or (4) if the Borrower shall default or fail to perform any covenant , condition or agreement on its part under the Mortgage, the Assignment of Lease and Rents or any other security document securing the Bond, and such failure continues beyond the period set forth in such documents during which the Borrower may cure such default. Section 6.02. flcunixLa_ffitma_diza. Whenever any Event of Default referred to in Section 6.01 shall have happened and be subsisting , the following remedial steps may be taken by the County, with the prior written consent of the Lender to the extent permitted by law, or by the Lender itself: 1S ( 1 ) the County or the Lender may , at its option, declare all installments of the loan payable under this Agreement (being an amount equal to that necessary to pay in full the Principal Balance of the Bond assuming accel- eration of the Bond under the terms thereof and to pay all other indebtedness thereunder ) to be immediately due and payable, whereupon the same shall become immediately due and payable by the Borrower ; and (2) the County or the Lender may take whatever action at law or in equity may appear necessary or appro- priate to collect the amounts then due and thereafter to become due, or to enforce performance and observance of any obligation, agreement or convenant of the Borrower under this Agreement. Section 6.03. atkkga,;.±j u_Bf Funds. Any amounts col- lected pursuant to action taken under Section 6.02, after deducting all expenses incurred in collecting the same, shall be applied to the Principal Balance of the Bond and interest thereon, such amounts being applied first to interest and then to principal amounts due on the Bond. Section 6.04. tgunaLsti_ExttLil.Q. No remedy herein conferred upon or reserved to the County or the Lender is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power ur• shall be construed to be a waiver thereof , but any such right and power may be exercised from time to time and as often as may be deemed expedient . In order to entitle the County or the Lender to exercise any remedy reserved to it in this Arti- cle , it shall not be necessary to give any notice , other than such notice as may be expressly required herein. Section 6.05. Eii2cu .'_E122_AIl ._EAR uita- In the event the Borrower should default under any of the provisions of this Agreement and the County or the Lender should employ attorneys or incur other expenses for the collection of amounts due hereunder or the enforcement of performance of any obligation or agreement on the part of the Borrower , the Borrower will on demand pay to the County or the Lender the reasonable fee of such attorneys and such other expenses so incurred. 16 Section 6.06. Ef£ET..±_2n_W iYaL• In the event any agree- ment contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder . ARTICLE VII GENERAL Section 7.01 . djttiL.25• All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when mailed by certified or registered mail , postage prepaid, with proper address as indicated below. The County, the Borrower and the Lender may, by written notice given by each to the others , designate any address or addresses to which notices, certificates or other communications to them shall be sent when required as contemplated by this Agreement. Until otherwise provided by the respective parties , all notices, certificates and communications to each of them shall be addressed as follows : To the County: Finance Director Weld County Post Office Box 75S Greeley, Colorado 80631 To the Borrower : Castle Real Estate Corporation 7075 Rustic Trail Boulder , Colorado 80201 To the Lender : The Empire Savings, Building and Loan Association 1654 California Street Denver , Colorado 80202 Attention: Corporate Secretary Section 7.02. @illSaL2.Effsze.#. This Agreement shall inure o the benefit of and shall be binding upon the County and the Borrower and their respective successors and assigns. Section 7.03 . EgY�Cati ,.i±x. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction , such holding shall not invali- date or render unenforceable any other provision hereof . 17 Section 7.0 4. ©mandmani .s._LhansLa_nnd_tustifiLLiiana. Except as otherwise provided in this Agreement or in the Ordin- ance, subsequent to the initial issuance of the Bond and before the Bond is satisfied and discharged in accordance with its terms , this Agreement may not be effectively amended, changed, modified, altered or terminted without the written consent of the Lender . Section 7.OS. Exas.utiQU_C.ctunj L2 x.11. This Agreement may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 7.OE•. Limi±ailQnstf....Q.aunttL _Liabili �:. It is understood and agreed by the Borrower and the Lender that no covenant of the County herein shall give rise to a pecuniary liability of the County or a charge against its general credit or taxing powers . It is further understood and agreed by the Borrower and the Lender that the County shall incur no pecu- niary liability hereunder , and shall not be liable for any expenses related hereto, including administrative expenses and fees and disbursements of the County ' s attorney and the bond counsel retained in connection therewith, all of which expenses the Borrower agrees to pay. If notwithstanding the provisions of the immediately preceding sentence, the County incurs any expense , or suffers any losses, claims or damages, or incurs any liabilities in connection with the transaction contemplated by this Agreement, the Borrower will indemnify and hold harm- less the County from the same and will reimburse the County for any legal or other expenses incurred by the County in relation thereto ; and this covenant to indemnify , hold harmless and reimburse the County shall survive delivery of and payment for the Bond. Section 7.07. ea.kiantnen#_Lx_C2unII. The County may assign its rights under this Agreement and any related docu- ments to the Lender to secure payment of the principal of , premium, if any , and interest on the Bond, but any such assign- ment shall not operate to limit or otherwise affect the follow- ing provisions running to the County from the Borrower which shall survive any such assignment : 18 Section 2.02 hereof Section 4.02 hereof Section 4.04 hereof Section 4.0S hereof Section 4 .07 hereof Section 4 .08 hereof Section 7.06 hereof Upon any such assignment, the provisions immediately above running to the County from the Borrower shall run jointly and severally to the County and the Lender, provided that the County shall have no right to assert any retained rights so long as the Lender is asserting the agreements under this Loan Agreement in a manner to protect the County and not bring adverse consequences to the County by its actions . IN WITNESS WHEREOF, the County and the Borrower have caused this Agreement to be executed in their respective names all as of the date first above written. COUNTY OF WELD, COLORADO By Chairman, Board of County Commissioners By County Clerk CASTLE REAL ESTATE COMPANY By Its : By its : 19 STATE OF COLORADO 3 COUNTY OF 3 5s. The foregoing instrument was acknowledged before me this _ day of December , 1979, by Norman Carlson and Mary Ann Feuerstein as Chairman of the Board of County Commissioners and County Clerk, respectively, of Weld County, Colorado. [Notarial Stall Notary Public for the State of Colorado My commission expires: STATE OF COLORADO 1 COUNTY OF I $s . The foregoing instrument was acknowledged before me this _ _ day of December , 1979, by as _____ _ of The Empire Savings, Building and Loan Association . [Notarial Seal) Notary Public for the State of Colorado My commission expires : 20 ASSIGNMENT OF LOAN AGREEMENT For the purpose of securing payment of the Industrial Development Revenue Bond (Castle Real Estate Company Project) , dated December , 197'3, issued by the County of Weld , Colorado (the "County" ) , and the County does hereby grant a security interest in and assigns and transfers unto The Empire Savings, Building and Loan Association of Denver , Colorado (the "Asso- ciation" ) the County ' s entire rights and interests in the attached Loan Agreement dated December , 1979, between the County and Castle Real Estate Company ( including but not limited to the County ' s right to receive loan repayments) , subject to the provisions of Section 7.07 of said Loan Agreement. COUNTY OF WELD, COLORADO December __, 1979 By Chairman of Board of County Commissioners By County Clerk The assignee hereby agrees and accepts this assignment. December __, 1979 THE EMPIRE SAVINGS, SUILDINC AND LOAN ASSOCIATION Attest: By Kay Wilson, Assistant J. Darrell Rocks, Scniow Vice Secretary President Its : EXHIBIT A LEGAL DESCRIPTION That portion of the Southwest Quarter of the Southwest Quarter of Section 19, Township 1 North, Range 68 West of the 6th P .H. , more particularly described as follows : Beginning at a point on the South line of the Southwest Quarter of said Section 19 , which point is 30 . 00 feet East of the West line of said Southwest Quarter and on the East line of Weld County Road No. 1 ; thence North 0° 44 ' 14" East (basis of bearinos is the Erle Air Park Subdivision) along the East line of said County Road and parallel with the West line of said Southwest Quarter , a distance of 1050. 00 feet; thence South 89° 11 ' 30" East , parallel with the South line of said Southwest Quarter , a distance of 734.27 feet to the West line of the Chicago, Burlington and Quincy Railroad right of way; thence South 01O 54 ' 28" 'Vest along said West railroad right of way line, a distance of 1050. 19 feet to the South line of said Southwest Quarter; thence North 39° 11 ' 30" West along said South line , a distance of 712. 18 feet to the Point of Beginning , All in the County of Weld , State of Colorado. EXHIBIT B - - 7p - 7 + Mam office � 1654 California Street f ,__ _ _� Denver, Colorado 80202 • ��.vs�.di••y }°`e� • 303%623-1771 January 9 , 1979 Board of County Commissioners Weld County, Colorado Greeley , Colorado 80631 Castle Corporation c/o H. Thomas Stroop 7075 Rustic Trail Boulder , Colorado 80301 H. Thomas Stroop Marianne Stroop 7075 Rustic Trail Boulder , Colorado 80301 Re : Industrial Development Revenue Bond (Castle Corporation Project) Series 1979 , County of Weld , Colorado , in an aggregate principal amount not to exceed $450 , 000 . Gentlemen: This letter is to evidence the commitment of The Empire Savings , Building and Loan Association (the Association) , in Denver , Colorado to purchase from Weld County , Colorado (the County) , its Industrial Development Revenue Bond (Castle Corporation Project) Series 1979 (the Bond) , in an aggregate principal amount not to exceed $450 , 000 . The Bond shall be issued for the purpose of financing a portion of the cost of a project (the Project) consisting of the acquisition of certain land described in Exhibit A attached hereto (the Project Site) and the construction of a building (the Building) to be used for the manu- facture off':itchen cabinets by Castle Corporation (the Company) . The Project Site is located approximately 1 . 5 miles south of the town of Erie within the County . The date of the purchase of the Bond from the County by the Association, the delivery of the executed Bond by the County to the Association, and the execution, delivery , recording and filing of all of the documents contemplated in connection with the issuance of the Bond is herein called the Closing Date . The purchase of the Bond by the Association shall be subject to the following require- ments , terms and conditions : 1 . The Bond shall be issued pursuant to an authorizing resolution adopted by the Board of County Commissioners and a Loan Agree- A Financial Service of +��•MA t Castle Corporation' January 9 , 1979 t Page Two ment (the Loan Agreement) between and among the County , Mr . H. Thomas Stroop and Mrs . Marianne Stroop (the Stroops) husband and wife , as owners of the Project Site and sole or controlling shareholders of the Company , or the Company . The County ' s right , title and interest in the Loan Agree- ment shall be assigned to the Association pursuant to an Assignment of Loan Agreement in consideration of the purchase of the Bond . Under the Loan Agreement , the proceeds of the Bond will be loaned by the County to the Stroops or the Company and the Stroops or the Company will agree to make loan repayments in an amount sufficient to pay the principal of and interest on the Bond when due. The Bond shall be further secured by a First Deed of Trust or Mortgage (the Mortgage) from the Stroops or the -Company , whoever is the record owner of the Project Site on the Closing Date, to the Association and , in the event that the Loan Agreement is entered into by the Stroops , by a Lease Agreement (the Lease) between the Stroops , as lessors , and the Company , as lessee . The Stroops ' right , title and interest in the Lease shall be assigned by the Stroops to the Association. Payment of the principal of and interest on the Bond shall be guaranteed by the Stroops and the Company pursuant to a separate Guaranty Agreement of the principal user (the Guaranty) between the Stroops , the Company and the Association . The Bond , the Loan Agreement , the Assign- ment of Loan Agreement , the Mortgage , the Lease and the assign- ment thereof and the Guaranty shall be in form satisfactory to the Association. The Bond shall be payable to the Association . The principal balance of the Bond outstanding from time to time (the Principal Balance) shall bear interest at the rate of 8 . 50% per annum (except that , if interest thereon should become subject to Federal or State income taxation, the interest rate shall be increased to 11 1/2% per annum) . The Bond shall be payable in equal monthly installments , including both principal and interest , on the first business day of each month , commenc- ing on the first business day of the month following the Closing Date , in the amount required to amortize the Principal Balance from the Closing Date to a date 25 years from the Closing Date . The Bond shall be due and payable in full , in the amount of its Principal Balance at that time, on a date 15 years from the Closing Date. The Bond shall provide that the principal may be prepaid in whole or in part on 30 days written notice and upon payment to the Association of 90 days interest at the rate provided in the Note , computed on the amount prepaid . The Association shall purchase the Bond from the County on the Closing Date at a purchase price equal to the principal amount of the Bond. 2 . The Loan Agreement and Deed of Trust shall provide for monthly payments by the Stroops or the Company to the Association of 1/ 12th of the annual estimated real estate taxes on the Project Castle Corporatio s 1 January 9 , 1979 Page Three and Project Site for the purposes of a property tax escrow fund to be held and administered by the Association . 3 . All right , title and interest of the Stroops or the Company in the Project and in the Project Site , including all improve- ments , appurtenances and fixtures attached thereto on the Closing Date or thereafter , shall be mortgaged and pledged to the Association pursuant to the Mortgage . Appropriate financing statements shall be filed to record and perfect the security interest of the Association in the Loan Agreement and the Lease. 4 . On the Closing Date , title to the Project Site will either be in the name of the Stroops , Castle Real Estate Company , a limited partnership , or in the name of the Company . The record owner of the Project Site on the Closing Date will execute and deliver the Mortgage to the Association . 5 . The Project Site shall have been improved with the construction of the Building , which building shall be suitable for the manu- facturing operations of the company and shall contain approximate 37 , 000 gross square feet . The Building shall be constructed substantially in accordance with the preliminary plans and spec- ifications on file as of the date of this letter in the offices of the Association and dated as of May 2 , 1978 . 6 . Pursuant to the provisions of the Loan Agreement , the Stroops or the Company will agree to procure and maintain throughout the term of the Loan Agreement , insurance such that the Project will be continuously insured against such risks as are customaril' insured against by businesses of like size and type , paying as the same become due and payable all premiums with respect thereto including but not necessarily limited to : a . Insurance upon the actual cash value of the Project (but in no event less than the cost of paying or redeeming the Principal Balance of the Bond) as determined by a recognized appraiser or insurer selected by the Stroops or the Company and approved by the Association, against loss or damage by fire , lightning , wind storm, hail, explosion , riots , civil commotion, vandalism, malicious mischief , aircraft , vehicles and smoke with uniform standard extended coverage endorsement limited only as may be provided in the standard form of extended coverage endorsement at the time in use in the State of Colorado . b . General accident and public liability insurance to the extent of $500 , 000 per person and $ 1 million per accident , against liability for bodily injury , including death resulting therefrom , and $500 , 000 per accident against liability for damage to property , including loss of use thereof , occurring on or in any way relating to the Project or any part thereof . Castle Corporation January 9 , 1979 Page. Four The Association requests that its insurance agency be permitted to bid on the above insurance on a competitive rate basis . 7 . On the Closing Date , the Association shall be furnished with an ALTA policy of mortgagee ' s title insurance from a title insurance company approved by the Association in a face amount not less than the principal amount of the Bond , covering the title to the Project Site and showing the Mortgage to be a valid first lien on the Project Site , subject only to exceptions , restrictions , rights of way , and easements agreed to by the Association. 8 . Not less than ten days prior to the Closing Date , the Stroops or the Company shall deliver to the Association for its approval the following : a . An improvement location survey, dated not more than 90 days prior to its date of submission to the Assoc- iation, certified by a registered professional engineer , showing the location of the Building and other improve- ments on the Project Site, and containing an exact legal description of the Project Site, including easements and rights appurtenant thereto . b . A commitment for the title insurance described in para- graph 7 of this letter , as well as a current tax cert- ificate pertaining to the Project Site. c . A certificate of occupancy issued by the proper municipal authority . d . A soil test made by a professional soil testing labor- atory , with engineering recommendations for footings and foundations based upon the tests , as well as a certific- ation by the soils engineer with respect to the Stroops ' or the Company ' s compliance with said recommendations . e . A report of professional structural and mechanical engineers with respect to the adequacy of design and gpecifications of the structural and mechanical systems of the Building, as well as a certification by said engineers that the completed mechanical and structural systems were constructed in accordance with the plans and specifications referred to above . f . Copies of the personal income tax returns for the Stroops for the years 1976 , 1977 , and 1978 . g . Financial statements of the Stroops and the Company , in form satisfactory to the Association, dated not later than thirty (30) days from their date of submission . Castle Corporation January 9 ; 1979 Page Five h . A written opinion from counsel to the Stroops and the Company that the Building and other improvements on the Project Site do not violate federal , state of local environmental control acts , as well as local zoning or land use laws . i . A complete set of plans and specifications for the Project which indicate the approval of all proper governmental authorities , together with plot plan engineering details and specifications , which shall not have been altered without the Association ' s prior written consent . 9 . On the Closing Date the Association shall receive an opinion from DeMuth, Eiberger , Kemp & Backus , Denver , Colorado or other bond counsel selected by the Association and the County , stating that the Bond is validly issued and that the interest on the Bond is exempt from federal and state income taxation. 10 . On the Closing Date, the Association shall receive a certified copy of the Lease as executed between the Stroops and the Compan_✓ . Additionally , on the Closing Date the Association shall receive an estoppel certificate, indicating that the lease is in full force and effect , and that there have been no defaults there- under . 11 . The Association shall be provided by the Stroops and the Company with annual operating statements showing the gross income and expenses of the Project . These statements shall be furnished within ninety (90) days of the close of the fiscal year of the Company, throughout the term of the Loan Agreement . 12 . The Closing Date shall not precede the completion of the construction of the Project in substantial accordance with the plans and specifications , and a final inspection of the Project by the Association. 13 . The Association may charge as its service charge an amount not to exceed $500, for the appraisal of the Project Site and the Project and for general expenses incurred in the processing of its loan to the County and purchase of the Bond from the County . This service charge does not include bond counsel fees , fees of counsel to the Stroops or the Company , fees of real estate counsel or any other fees incurred by the Stroops , the Company or the Association in connection with the Project and the issuance of the Bond . 14 . The transactions contemplated hereunder are subject to all rules and regulations governing the Association . 15 . This commitment shall not be assignable without the prior written consent of the Association. Castle Corporation` January ,9 , 1979 Page Six This commitment shall expire February 6 , 1979 , unless accepted by the Stroops , the Company and the County and returned to the Association prior to that date , accompanied by a deposit with the Association of $4 , 500 as a non-refundable binder , in which event the commitment shall be effective to December 31 , 1979 . An additional fee of $4 , 500 shall be payable to the Association immediately prior to the purchase of the Bond pursuant to this commitment and such purchase shall be contingent upon the payment of said fee. Sincerely , THE EMPIRE SAVINGS , BUILDING AND LOAN ASSOCIATION Clarence M. Hughes' Assistant Vice President Commercial Loan Department The foregoing commitment is accepted this 5th day of February , 1979 , by the undersigned . CASTLE CORPORATION By �� - .r..✓/J[� . r President ATTEST : ST VV Secretary / (CORPORATE) ? � '— ��-✓/ / SEAL H . Thomas Stroop Marianne Stroop WELD COUNTY , COLORADO Byi ✓ President of the Board of County Commissioners ATTEST : Hello