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ORDINANCE NO. 9704
AN ORDINANCE APPROVING AN AFFORDABLE HOUSING
DEVELOPMENT AGREEMENT BETWEEN MOUNTAIN VIEW
TOWNHOMES, LLLP, A COLORADO LIMITED LIABILITY
LIMITED PARTNERSHIP, THE HOUSING AUTHORITY OF THE
CITY OF PUEBLO, A PUBLIC BODY CORPORATE AND POLITIC,
AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION,
AND AUTHORIZING THE MAYOR TO EXECUTE SAME
WHEREAS, there exists a need for affordable housing in the City of Pueblo; and
WHEREAS, there exists a need to update the existing public housing known as the Sangre
de Cristo Apartments, located at 2601 Sitter Place; and
WHEREAS, the City of Pueblo receives HOME Investment Partnership Grant funds from
the U.S. Department of Housing and Urban Development for the creation and retention of
affordable housing; NOW, THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The City of Pueblo Affordable Housing Development Agreement dated April 30, 2020,
between Mountain View Townhomes, LLLP, a Colorado Limited Liability Limited Partnership, the
Housing Authority of the City of Pueblo, a Public Body Corporate and Politic, and the City of
Pueblo, a Municipal Corporation, (the “Agreement”) for the development of affordable housing, a
copy of which is attached and incorporated herein, having been approved as to form by the City
Attorney, is hereby approved.
SECTION 2.
The $500,000.00 in loan funds are available in Fund 251 and will be dedicated to this
Agreement and the associated project.
SECTION 3.
The Mayor is hereby authorized to execute the Agreement in the name and on behalf of
the City of Pueblo, where the Mayor may execute the Agreement by electronic signature and such
electronic signature shall be attributable to the Mayor and the City of Pueblo.
SECTION 4.
The officers and staff of the City are directed and authorized to perform any and all acts
consistent with the intent of this Ordinance and the attached Agreements to effectuate the
transactions described therein.
SECTION 5.
If any section, paragraph, clause, or provision of this Ordinance shall for any reason be
held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph,
clause, or provision shall not affect any of the remaining provisions of this Ordinance.
SECTION 6.
This Ordinance shall become effective on the date of final action by the Mayor and City
Council.
THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE TO FOLLOW
Action by City Council:
Introduced and initial adoption of Ordinance by City Council on April 13, 2020
Final adoption of Ordinance by City Council on April 27, 2020 .
President of City Council
Action by the Mayor:
☒ Approved on April 28, 2020 .
☐ Disapproved on based on the following objections:
Mayor
Action by City Council After Disapproval by the Mayor:
☐ Council did not act to override the Mayor's veto.
☐ Ordinance re-adopted on a vote of , on
☐ Council action on __________________failed to override the Mayor’s veto.
President of City Council
ATTEST
City Clerk
City Clerk’s Office Item # R-6
Background Paper for Proposed
Ordinance
COUNCIL MEETING DATE: April 13, 2020
TO: President Dennis E. Flores and Members of City Council
CC: Nicholas A. Gradisar, Mayor
VIA: Brenda Armijo, City Clerk
FROM: Bryan Gallagher, Director, Housing and Citizen Services
SUBJECT: AN ORDINANCE APPROVING AN AFFORDABLE HOUSING DEVELOPMENT
AGREEMENT BETWEEN MOUNTAIN VIEW TOWNHOMES, LLLP, A
COLORADO LIMITED LIABILITY LIMITED PARTNERSHIP, THE HOUSING
AUTHORITY OF THE CITY OF PUEBLO, A PUBLIC BODY CORPORATE AND
POLITIC, AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND
AUTHORIZING THE MAYOR TO EXECUTE SAME
SUMMARY:
This Ordinance approves the City of Pueblo’s Affordable Housing Development Agreement with
Mountain View Townhomes, LLLP and the Housing Authority of the City of Pueblo for the
development of a fifty-one (51) unit affordable housing rental project known as Mountain View
Townhomes.
PREVIOUS COUNCIL ACTION:
The City Council has not taken any previous action on this matter.
BACKGROUND:
In May of 2019 and in July of 2019, the Department of Housing and Citizen Services issued a
Notice of Funding Availability (NOFA) under the HOME Program. The Housing Authority (dba
Mountain View MM, LLC) applied for HOME funds for the development of a 51-unit rental project
to be known as Mountain View Townhomes. HOME funds will assist five (5) of the units. This
Project is part of multiple phased project to replace the Sangre de Cristo public housing complex.
The Project will serve households at 30-60% of the area median income (AMI). Forty-five percent
(45%) of the units are designated for residents with incomes below 30% of AMI. This is a Rental
Assistance Demonstration Grant (RAD) HUD sponsored project, and as such, existing residents
at Sangre de Cristo will have preference in the unit rentals.
Project costs are approximately $19.5 million, and are being funded through multiple sources:
1. CHFA Construction Loan $ 8,934,589
2. Housing Authority of Pueblo / El Centro Development Corp $ 3,802,419
3. Colorado Division of Housing $ 3,000,000
4. Richmond Group, Initial Funding $ 1,843,000
5. City of Pueblo HOME and HOME Match $ 500,000
6. US Bank Permanent Loan $ 1,425,000
The Richman Group Affordable Housing Corporation will provide $12,283,772 in capital
contributions to Mountain View Townhomes, LLLP as an equity partner throughout the project.
This is the tax credit limited partner contribution.
FINANCIAL IMPLICATIONS:
The City HOME contribution is available in the 251 Fund, and is comprised of HOME grant funds,
program income, and City match contributions.
BOARD/COMMISSION RECOMMENDATION:
Not applicable.
STAKEHOLDER PROCESS:
Not applicable.
ALTERNATIVES:
Not applicable.
RECOMMENDATION:
Approval of the Ordinance.
ATTACHMENTS:
Attachment 1: City of Pueblo Affordable Housing Development Agreement
Attachment 2: Deed of Trust
Attachment 3: Promissory Note
Attachment 4: US Bank Subordination Agreement
CITY OF PUEBLO
AFFORDABLE HOUSING DEVELOPMENT AGREEMENT
(RENTAL DEVELOPMENT)
This Agreement is made and entered into this 30th day of April 2020 ("Effective Date") by
and between the City of Pueblo, a Municipal Corporation (hereinafter referred to as "City"), the
Housing Authority of the City of Pueblo,Colorado, a public body corporate and politic(hereinafter
referred to as "Developer"), and Mountain View Townhomes, LLLP, a Colorado limited liability
limited partnership (hereinafter referred to as "Owner").
WITNESSETH, that:
WHEREAS, the City has entered into agreements with the U.S. Department of Housing
and Urban Development ("HUD"), whereby federal financial assistance may be made available to
City on behalf of the Pueblo Consortium ("Consortium"), established under Agreements between
City and Pueblo County, Colorado ("County"), as a Participating Jurisdiction for the purpose of
expanding the availability of affordable housing pursuant to the HOME Investment Partnerships
Act ("the Act") (42 U.S.C. 12701 et seq.), the Cranston-Gonzales National Affordable Housing
Act and implementing regulations, including but not limited to those at 24 CFR Part 92; and
WHEREAS, in accordance with the provisions of the Act and 24 CFR Sections 92.200 and
92.205,a portion of such financial assistance, subject to de-obligation(and subject to appropriation
with respect to any assistance payable out of future fiscal year allotments), may be made available
to qualifying non-profit entities for the purpose of carrying out specific elements of the
participating jurisdiction's housing strategy, including new construction of affordable rental
housing; and
WHEREAS, Developer has submitted a project proposal for new construction of rental
housing to create affordable housing in fulfillment of a portion of the City's and Consortium's
housing strategy and has been selected to receive a loan for such project; and
WHEREAS, Developer has represented to City and the Consortium that it is a duly
qualified public housing authority which is eligible and willing to undertake its proposed
affordable housing project, as set forth in its application, as further amended by this Agreement
and the attachments hereto; and
WHEREAS, Developer, through its non-profit affiliate, El Centro Pueblo Development
Corporation, Inc., has formed Owner to assemble the financing, acquire the Property (defined in
Section 4(b)below)on which the Project will be constructed,and implement the development plan
with Developer's assistance; and
WHEREAS, based upon Developer's representations, the Consortium and the City believe
Developer and Owner are capable or can reasonably be expected to become capable of carrying
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out said project, and City is willing to allocate federal funds as a loan to Owner for investment in
housing to be developed, sponsored or assisted by Developer which will comply with and fulfill
said approved elements of City's housing strategy; and
WHEREAS, Developer has applied for and received from the Colorado Housing and
Financing Authority a preliminary reservation of Federal Low-Income Housing Tax Credits in the
amount of$12,283,772.00 for allocation to Developer's project upon placement of the housing in
service; and
WHEREAS, Developer warrants and guarantees that as of the date of execution of this
Agreement, all necessary financing has been secured, a budget and schedule has been established,
underwriting has been completed, and construction is scheduled to start within twelve months of
the agreement date in accordance with the definition of"commit to a specific local project," 24
C.F.R. § 92.2; and
WHEREAS, the City is duly authorized to enter into this Agreement for and on behalf of
the Consortium and to undertake all actions required by this instrument.
NOW, THEREFORE, in consideration of the foregoing recitals and the covenants, terms
and conditions set forth herein, the parties agree as follows:
1. DEVELOPER SERVICES.
(a) Developer shall, directly or indirectly, in accordance with all applicable federal,
state and local laws and regulations, undertake the construction of a new fifty-one (51) unit
affordable housing project for low to moderate income households, with five (5) of the housing
units being assisted hereunder, in furtherance of the Consortium's housing strategy and as
approved by the City. The affordable housing project, as described herein, may be referred to as
the"Mountain View Townhomes Project"or the"Project." Developer may undertake same as the
Project sponsor with ownership of the Project to be held by either the Developer or by a limited
liability partnership or limited liability limited partnership in which Developer or its affiliate acts
as the sole member of the general partner, or by a limited liability company in which Developer is
the sole member of the managing member. Developer shall satisfactorily perform and complete,
or cause to be performed and completed, all services and items of work, and the furnishing of all
labor and materials encompassed within or reasonably necessary to construct all of the
improvements for the Project, and accomplish the tasks and functions described in the Scope of
Services attached hereto as Exhibit "A" and incorporated herein by reference, in full compliance
with all of the provisions of this Agreement. Before proceeding with the Project, Developer shall
furnish City with all reasonable information which City may request concerning the Project,
execute all certifications, security instruments required by this Agreement and applicable laws and
regulations, demonstrate eligibility of the Project for assistance under this Agreement and the Act,
and obtain the written approval of City's authorized representatives as to the Project. which
approval will not be unreasonably withheld. Upon project completion, housing must meet or
exceed the minimum property standards required by 24 CFR 92.251. Owner must continue to
maintain the housing in compliance with 24 CFR 92.251 during the period of affordability.
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(b) Developer warrants and represents that(i) it has the requisite authority and capacity
to perform all terms and conditions on Developer's part to be performed hereunder; (ii) that it is
duly organized as a public housing authority under the laws of the State of Colorado, including but
not limited to the Colorado Housing Authority Law, as amended, C.R.S. § 29-4-201 et seq. (Vol.
9, 2000); (iii) that it is aware of and understands its duty to perform all functions and services in
accordance with the regulatory requirements of 24 CFR Part 92 and those identified in the exhibits
hereto; and (iv) that it is accepting federal financial assistance hereunder subject to certain
mandatory repayment provisions.
(c) Time is of the essence hereof. Developer agrees that it shall meet the following
deadlines with respect to the Project:
(i) Developer shall obtain satisfactory evidence that the Owner has the
financial ability to undertake and construct the Project, including proof that it has secured
approval for tax credits,obtained loan commitments fora construction loan and the primary
loan permanent financing for the Project, and furnish such evidence to City, on or before
April 30, 2020.
(ii) Developer shall obtain commitments for all required loans on or before
April 30, 2020;
(iii) Developer shall commence construction of the Project not later than June 1,
2020;
(iv) Developer shall substantially complete construction of the Project not later
than July 31, 2021; and
(v) Lease-up of the Project shall be accomplished by not later than July 31,
2022.
2. ROLE AND RESPONSIBILITIES OF THE CITY.
Under this Agreement, the City is acting on behalf of the Consortium. Notwithstanding
the foregoing, all obligations of Developer under this Agreement shall run directly to City and be
fully enforceable by City and in the name of the City. The City shall designate a representative of
the City who will be authorized to make all necessary decisions required of the City on behalf of
the City in connection with the performance of this Agreement, approval of the Project to be
undertaken by Developer hereunder and the disbursement of funds in connection therewith. In the
absence of such a designation, the Mayor shall be deemed as City's authorized representative.
3. FINANCIAL ASSISTANCE AND METHOD OF PAYMENT.
(a) Upon execution of all documents required by City, the City will loan to Owner an
amount up to that specified in paragraph (c) of this section as the public investment in the Project
assisted under this Agreement. Disbursement of funds to Owner is subject to all of the following
requirements, which shall be conditions precedent to payment: (i)that Owner has expended funds
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after April 30, 2020 for eligible approved expenditures with respect to the Project, (ii)that neither
Developer nor Owner are in default of any material provision of this Agreement nor applicable
law or regulation, (iii) that either Developer or Owner has timely submitted requests for
disbursement detailing the eligible draw-down items in a format approved by City, (iv)that either
Developer or Owner has certified with each payment or loan draw-down request compliance with
the requirements identified in Exhibit"C"and that all expenditures for which draw-down is sought
were made for and in furtherance of the Project and are an eligible use of federal assistance under
the Act, and (v) that City has timely received from HUD sufficient federal assistance under the
Act to pay the disbursement hereunder. Neither Developer nor Owner may request disbursement
of funds under the Agreement until the funds are needed for payment of eligible costs, and the
amount of each request must be limited to the amount needed.
(b) Payment hereunder is also subject to and may only be disbursed in accordance with
HUD regulations including but not limited to those at 24 CFR Part 92, as presently promulgated
and as same may be revised from time to time in the future. All payments received by Owner
hereunder are subject to repayment by Owner, where Owner shall repay all funds that City as a
participating jurisdiction would be required to repay as provided in 24 CFR Part 92. If the HOME
Units do not meet the affordability requirements or has not been rented to eligible tenants in
accordance with Exhibit "A", such failures shall be a default of this Agreement, any related loan
agreement, and the Deed of Trust, and all HOME funds must be returned to City. In case of such
default, City may pursue remedies through this Agreement, loan agreements, including any
Promissory Note, and/or the Deed of Trust. Funds provided hereunder for Project may only be
used for development costs, as provided in 24 CFR 92.205(d) and 92.206(a), (c) and (d), where
such costs can be separated, and funds are only applied to the units designated for the affordable
housing project. Funds committed hereunder meet the requirements of"commit to a specific local
project" under 24 CFR 92.504 and 24 CFR 92.2.
(c) The aggregate of all payments made hereunder shall not exceed Five Hundred-
Thousand and No/100 Dollars (U.S. $500,000.00).
(d) Upon expiration of the term of this Agreement or upon any prior termination,
Developer shall transfer to City any funds provided hereunder which are on hand at the time of
expiration or termination together with any accounts receivable attributable to the use of funds
provided hereunder.
4. TERM OF AGREEMENT; SECURITY.
(a) Unless sooner terminated, the term of this Agreement, for purposes of making the
loan and undertaking the construction and completion of the Project, shall be the Effective Date
through the period of affordability, which is estimated to end July 31, 2041; provided however,
that with the respect to the Project for which Developer and Owner have received financial
assistance under and during the term of this Agreement, Developer and Owner shall have
continuing responsibility to comply with the performance, certifications, repayment,
nondiscrimination, affirmative marketing, displacement, relocation, acquisition, labor, conflict of
interest, housing affordability compliance, recordkeeping and other requirements of this
Agreement, and 24 CFR Part 92 (including, without limitation 24 CFR Sections 92.251, 92.252,
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92.350, 92.351, 92.353, 92.354, 92.356, 92.359, and 92.508) which shall survive expiration or
termination and remain in effect throughout the required full period of affordability,
notwithstanding any prior termination or expiration of this Agreement. As used herein, "period of
affordability" shall mean 20 years from the completion of the Project, except that if the assistance
provided hereunder is used in connection with other financing insured by HUD under Chapter lI
of Title 24, Code of Federal Regulations, the period of affordability shall be the full original term
of said mortgage or 20 years, whichever is longer.
(b) (i) The full amount of loan assistance provided to Developer and Owner for
the Project pursuant to this Agreement shall constitute an indebtedness of the Owner to City which
shall be evidenced by a promissory note (hereinafter referred to as the "Promissory Note" or
"Note") which shall be due and payable with interest as provided therein and which shall be
secured by the following described real property, also the legal description of the property where
Project will be constructed, situate in the County of Pueblo, State of Colorado, (the "Property"):
LEGAL DESCRIPTION
Lot 1, Tracts A and B, Uplands Townhomes Filing No.2, Recorded December 6,2019 under
reception No. 2161535, County of Pueblo, State of Colorado
as evidenced by a Deed of Trust to be executed contemporaneously with said Promissory Note
(together the "loan instruments"). The addresses of the Project are:
• 1402, 1406, 1410, 1414, 1401, 1405, 1409, 1413, 1431, 1435, 1439, 1443, 1432, 1436,
1440, 1444 Lipan Place;
• 1402, 1406, 1410, 1414, 1401, 1405, 1409, 1413, 1431, 1435, 1439, 1443, 1432, 1436,
1440, 1444 Wichita Place;
• 1402, 1406, 1410, 1414, 1431, 1433, 1435, 1439, 1443, 1445, 1432, 1434, 1436, 1440,
1444, 1446 Mandan Place;
• 2501, 2505, 2509 Lakota Place.
The loan instruments shall require the Owner to pay to City or holder the indebtedness as and to
the extent same becomes due under the provisions of the Promissory Note and this Agreement.
Owner shall include terms in said Promissory Note and Deed of Trust stating that the amount of
the assistance shall continue as an indebtedness until paid in full, and notwithstanding such
payment in full, the affordability restrictions described in this Agreement shall continue in effect
and be enforceable for the full period of affordability without regard to the term specified in the
Note or Deed of Trust for repayment.
(ii) In order to secure the affordability provisions and other requirements of this
Agreement, City may, at any time, require an assignment and transfer of said Note and Deed of
Trust.
(c) During the full Term of this Agreement and for the period of affordability, (i) any
failure by the Owner to perform any obligation, covenant or provision of the Note or this
Agreement required to be performed by the Owner, or (ii) any breach of any warranty made by
Developer in this Agreement, or (iii) any other violation of any material term of this Agreement
or the Deed of Trust given to secure the Note, shall constitute a default under this Agreement.
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Upon any such default,the City may demand that Owner repay to City the full amount of assistance
provided hereunder, plus interest at the rate of four percent(4%) per annum from and after the date
of such default. Owner further agrees that no release of any security for the indebtedness or
extension of time for payment of same, or any installment thereof, and no alteration, amendment
or waiver of any provision of the Note or the Deed of Trust securing same shall in any manner,
release, discharge, modify or affect the obligations of Developer or Owner under this Agreement.
(d) City will provide the Owner, through notice to Mountain View MM, LLC (the
Owner's general partner), a copy of any written notice, at 201 South Victoria Avenue, Pueblo, CO
81003. City will allow the Owner thirty (30)days after receipt of such notice to cure or cause the
cure of any default under this Agreement or the Loan Documents (as hereinafter defined), or such
longer period as is reasonably necessary for the Owner to cure non-monetary defaults provided
that Owner commences to cure and continues with due diligence. Copies of any and all notices
required to be given by the Owner pursuant to this Agreement shall also be sent, in the same
manner as such notice is given to the Owner,to the Owner's limited partner(the-Equity Investor")
at the following address: USA Mountain View Townhomes LLC, c/o The Richman Group, 777
West Putnam Avenue, Greenwich, Connecticut 06830, Attention: Joanne D. Flanagan, Esq. The
Equity Investor may change its address for receipt of copies of notices by giving notice in writing
stating its new address to the City. Commencing on the tenth (10th) day after the giving of such
notice, the newly designated address shall be effective for purposes of all such copies of notices
required to be sent by the City to the Equity Investor.
(e)Notwithstanding anything to the contrary contained in this Agreement, Owner's
Limited Partner(s) shall have the right, but not the obligation, to cure defaults of Owner.
5. TERMINATION OF AGREEMENT.
(a) For Cause. This Agreement may be terminated by City for cause, including any
nonperformance by Developer or Owner, upon ten (10) days' written notice to Developer or
Owner, as applicable, including a statement of the reasons therefor, and after an opportunity for a
hearing has been afforded. If a hearing is requested, it shall be held before the City's Director of
Housing and Citizen Services whose decision as to both the grounds for termination and the
appropriateness thereof shall be final and binding upon both City and Developer. In accordance
with 2 CFR 200.338, cause for termination shall include any material failure by Developer or
Owner to comply with any term of this Agreement.
(b) For Convenience. This Agreement may be terminated for convenience in
accordance with the provisions of 2 CFR 200.339. This Agreement shall terminate immediately
upon any non-appropriation of funds, or upon any suspension or non-receipt of federal assistance
provided to City under the Act, regardless of cause.
(c) Post Termination Procedures. In the event of termination, Developer and Owner
shall continue to be responsible for those matters which survive termination identified in paragraph
4 above, unless City takes over the Project and, in connection therewith, prospectively releases
Developer and Owner from one or more specific responsibilities in writing. Additionally,at City's
sole option,all property acquired by Developer and Owner with loan funds,all loan funds, program
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income, and mortgage loans originated with loan funds or by payments therefrom and payments
received under such mortgage loans, held, owned or retained by Developer or Owner shall be
subject to recapture in accordance with the default provisions of the Deed of Trust. All finished
or unfinished documents, data, studies, reports and work product prepared by Developer, Owner,
or their agents and assigns under this Agreement or with loan funds shall, at the option of the City,
become its property, and Developer or Owner, as applicable, shall be entitled to receive just and
equitable compensation only for satisfactory work completed and eligible costs for which
compensation has not previously been paid nor reimbursement made.
6. ASSIGNABILITY.
This Agreement shall not be assigned or transferred by Developer or Owner without the
prior written consent of the City; provided however, that this limitation shall not be construed to
prohibit Developer from undertaking activities under this Agreement with the Owner meeting the
requirements of Section 1(a)of this Agreement. Any assignment or attempted assignment made in
violation of this provision shall, at City's election, be deemed void and of no effect whatsoever.
7. CONFLICT OF INTEREST.
HOME Regulation 24 CFR, Part 92.356 is incorporated herein by reference, and sets forth
applicable laws and regulations that apply to Conflict of Interest. Developer shall avoid all
conflicts prohibited by applicable regulations, including but not limited to those set forth in 24
CFR Part 92 as presently promulgated and as same may be revised from time to time in the future.
8. DEVELOPER RECORDKEEPING.
Developer shall maintain records as to the Project work and activities undertaken with
assistance hereunder, services provided, reimbursable expenses incurred in connection with the
Project and complete accounting records. Accounting records shall be kept on a generally
recognized accounting basis and as requested by the City's auditor. Developer agrees to comply
with all applicable uniform administrative requirements described or referenced in 24 CFR Part
92. The compliance provisions attached as Exhibit "B" hereto are made a part of this Agreement,
and Developer agrees to perform and comply with same. The City, HUD,the Comptroller General
of the United States, the Inspector General of HUD, and any of their authorized representatives,
shall have the right to inspect and copy, during reasonable business hours, all books, documents,
papers and records of Developer and the Owner which relate to this Agreement for the purpose of
making an audit or examination. Upon completion of the work and end of the term of this
Agreement, the City may, at any time during the period of affordability or within five (5) years
thereafter, require all of Developer's and the Owner's financial records relating to this Agreement
to be turned over to the City.
9. MONITORING AND EVALUATION.
The City shall have the right to monitor and evaluate the progress and performance of
Developer to assure that the terms of this Agreement are being satisfactorily fulfilled in accordance
with HUD's, City's, and other applicable monitoring and evaluation criteria and standards. The
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City shall at least quarterly review Developer's performance using on-site visits, progress reports
required to be submitted by Developer, audit findings, disbursement transactions and contact with
Developer as necessary. Developer shall furnish to the City monthly or quarterly program and
financial reports of its activities in such form and manner as may be requested by the City.
Developer shall fully cooperate with City relating to such monitoring and evaluation.
10. DEVELOPER FILES AND INFORMATION REPORTS.
Developer shall maintain files containing information which shall clearly document all
activities performed in conjunction with this Agreement, including, but not limited to, financial
transactions, conformance with assurances, activity reports, and program income. These records
shall be retained by Developer for a period of five(5)years, except that with respect to the Project
undertaken with assistance provided hereunder, such records shall be maintained for the full
required period of affordability and for the five (5) years thereafter. Activity reports shall be
submitted monthly or quarterly no later than the ninth (9th) day of the month following the end of
month or quarter for which the report is submitted.
11. INDEPENDENCE OF DEVELOPER.
Nothing herein contained nor the relationship of Developer and Owner to the City, which
relationships are expressly declared to be that of an independent contractors, shall make or be
construed to make Developer or the Owner, or any of Developer's or Owner's agents or
employees, the agents or employees of the City. Both Developer and Owner shall be solely and
entirely responsible for their acts and the acts of their agents, employees and subcontractors.
12. LIABILITY & INSURANCE.
(a) As to the City, Developer and Owner agrees to assume the risk of all personal
injury, including death and bodily injury, and damage to and destruction of property, including
loss of use therefrom, caused by or sustained, in whole or in part, in conjunction with or arising
out of the performance or nonperformance of this Agreement by Developer or Owner or by the
conditions created thereby. Developer and Owner further agree to indemnify and save harmless
the City, its officers, agents and employees, from and against any and all claims, liabilities, costs,
expenses, penalties and attorney fees arising from such injuries to persons or damages to property,
or based upon or arising out of the performance, nonperformance, or breach of this Agreement by
Developer or Owner, or out of any violation by Developer or Owner of any statute, ordinance, rule
or regulation.
(b) Owner agrees that it shall procure and will maintain during the term of this
Agreement, such insurance as will protect it from claims under workers'compensation acts,claims
for damages because of personal injury including bodily injury, sickness or disease or death of any
of its employees or of any person other than its employees, and from claims or damages because
of injury to or destruction of property including loss of use resulting therefrom; and such insurance
will provide for coverage in such amounts as set forth in subparagraph (c).
(c) The minimum insurance coverage which Owner shall obtain and keep in force is as
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follows:
(i) Workers' Compensation Insurance complying with statutory requirements
in Colorado.
(ii) Comprehensive General and Automobile Liability Insurance with limits not
less than One Million and No/l00 Dollars ($1,000,000.00) per person and occurrence for personal
injury, including but not limited to death and bodily injury, and One Million and No/l00 Dollars
($1,000,000.00) per occurrence for property damage.
(d) Owner further agrees that it shall procure and maintain, at Owner's expense, hazard
and fire insurance upon the property described in the Deed of Trust on an "all risk" form in such
amounts as City's Department of Housing and Citizen Services may require, but in any event, for
not less than the amount of all liens against the Property and the amount of funds provided to
Owner by City pursuant to this Agreement. Owner shall furnish a certificate of insurance
certifying such coverage to City's Director of Finance prior to disbursement of any funds to Owner.
Both said certificate of insurance and the policy procured by the Owner shall name the City as an
additional loss payee.
13. CERTIFICATIONS.
Developer agrees to execute and abide by the certifications contained in Exhibit"D"hereto,
which are hereby expressly made a part of this Agreement.
14. PROGRAM INCOME; REVERSION OF ASSETS
(a) Unless otherwise authorized by City in writing in a separate instrument executed
after date of this Agreement, all program income shall be returned to City within thirty (30) days
of receipt by Developer. In the event City authorizes Developer to retain any portion of program
income, it shall only be used to accomplish the work set forth in the Scope of Services, and the
amount of loan funds payable by City to Developer shall be adjusted as provided by 24 CFR
92.503.
(b) Upon expiration of the term of this Agreement, or upon any prior termination,
Developer shall transfer to City any funds provided hereunder which are on hand at the time of
expiration or termination together with any accounts receivable attributable to the use of funds
provided hereunder.
(c) The Project, the Property, and any other real property acquired, constructed or
improved in whole or in part with funds provided pursuant to this Agreement shall be used as
affordable rental housing within the meaning of 24 CFR 92.252 for the full period of affordability
as defined in paragraph 4 hereof. In the event the Project, the Property or such other property
ceases to be so used, Owner shall be in default under the Deed of Trust and Note, and Owner shall
immediately pay to City the greater of(i)an amount equal to the current market value of the Project
and Property less any portion of the value attributable to expenditures of funds not provided under
this Agreement for the construction of the Project or acquisition of, or improvement to, the
9
Property (that is, the calculation of the portion of value attributable to expenditures not provided
by City under this agreement shall be the market value multiplied by a fraction whose numerator
is the total Project cost or costs of acquisition determined as of the date of Project completion less
the amount of assistance provided by City and whose denominator is the total Project cost or cost
of acquisition determined as of the date of Project completion) or, (ii) the remaining principal
balance and accrued interest owing under the Note. The affordability requirements apply without
regard to the term of any loan or mortgage, repayment of the HOME investment, or transfer of
ownership. The use restriction and repayment obligation set forth in this subparagraph shall
survive termination or expiration of this Agreement and shall be fully enforceable and subject to
collection by City or HUD in accordance with applicable laws. Owner and any transferee shall
comply with the requirements of this paragraph and execute a Deed of Trust which shall be and
constitute a lien upon the Property and all other real property acquired or improved with funds
provided hereunder, and which shall secure the affordability requirements hereunder. City shall
have the right of first refusal to purchase the housing before foreclosure or deed in lieu of
foreclosure in order to preserve affordability. City will have the authority to and may require
specific performance to enforce the terms of this Agreement and any affordability requirements.
(d) In the event City incurs any cost or expense in enforcing the requirements of this
Agreement, including but not limited to the requirements of this paragraph 14, or in bringing any
action to recover the amount of any repayment obligation, or, upon assignment of the Note and the
Deed of Trust, to foreclose or obtain sale under the Deed of Trust or mortgage instrument, City
shall be entitled to recover its costs and expenses, including reasonable attorney's fees.
(e) To further ensure that the funds provided hereunder do not constitute an investment
of more HOME funds than are necessary to provide affordable housing (as required by 24 CFR
92.250(b)), Owner shall retain ownership of the Project for a period of not less than 20 years from
and after the completion of the Project.Consequently, in the event the Owner should sell or transfer
title to the Project, the Property, or other real property or improvements constructed or improved
with funds provided pursuant to this Agreement, within 20 years after substantial completion of
the Project or said improvements, any loan agreement, Note and Deed of Trust shall provide that
the entire indebtedness under the Note shall immediately become due and payable and shall be
collected and repaid to City, together with interest thereon at the rate of four percent (4%) per
annum from the time of substantial completion until said repayment is made; provided, however,
such repayment shall not be required to the extent permitted by federal law, if the City has granted
prior written approval of the sale or transfer, and the acquirer of the property becomes subject to
this Agreement, all HOME affordability restrictions, and the obligations of the Owner under this
Agreement, the Note, and Deed of Trust have been assigned to and assumed by the Project
purchaser, then Owner shall no longer be indebted to City and the City shall look to the Project
purchaser for performance of any remaining obligations hereunder. If Owner is a limited
partnership, nothing in this subparagraph (e), nor in subparagraph (f) of this paragraph 14, is
intended to prohibit a transfer of ownership from Owner to any general partner or limited partner
in Owner as long as the transferee remains subject to this Agreement, all HOME affordability
restrictions, and the obligations of the Owner under this Agreement, the Note, and Deed of Trust.
(f) It is the intent of the parties that C.R.S. § 38-30-165 and any similar statute hereafter
enacted, be preempted under federal law and regulations in order to maintain affordability of the
10
rental units within the Property. Consequently, any loan agreement between City and the Owner
and the Note and Deed of Trust executed by the Owner(collectively, the"Loan Documents")shall
not be assumable, and the indebtedness shall be due and payable upon sale,transfer or assignment,
or any attempted sale or transfer of the Property by the Owner, unless all of the following
circumstances are demonstrated to exist: (i) more than 20 years have elapsed since the substantial
completion of the Project, (ii) the senior lien holders also consent to assumption of the mortgage
or obligation to which the Deed of Trust is subordinate, (iii) the sale of the Property is to a
subsequent purchaser who agrees in writing to comply with the affordability requirements of this
Agreement and applicable requirements, including those set forth at 24 CFR, 92.252, (iv) the sale
price and payment of principal, interest, property taxes and insurance by the subsequent purchaser
must permit the rental units to remain affordable for the remaining period of affordability specified
in this Agreement, with affordability determined by applicable regulations and requirements, and
(v) both the City and the holder of the Note expressly consent to assumption of the Owner's
obligations under any loan agreement and the Note by the subsequent purchaser prior to sale or
transfer, which consent shall be granted only upon the Owner's showing circumstances (i)through
(iv) have or will be satisfied.
(g) Notwithstanding anything to the contrary in this Agreement or the Loan
Documents, the Owner may transfer its interest in the Project and the Property to Developer
without prior consent from the City.
15. SPECIAL REQUIREMENTS APPLICABLE TO IMPROVEMENTS TO
PROPERTY.
(a) In addition to all procurement requirements otherwise applicable to the Project
pursuant to any other provision of this Agreement or pursuant to any requirement of law or
regulation incorporated in this Agreement by reference, Developer and Owner shall comply with
all requirements of this Paragraph 15.
(b) No improvements shall be undertaken to the Property or other real property with
funds(or reimbursement)provided hereunder unless and until: (i)plans and specifications therefor
have been prepared by either a registered Professional Engineer in good standing and duly licensed
to practice in the State of Colorado or an Architect duly licensed and authorized to conduct a
practice of architecture in the state of Colorado; (ii) such plans and specifications have been filed
with the City and approved by both the City's designated representative and the City's Director of
Public Works; and (iii) all construction contracts for improvements for which funds are provided
from City shall have been awarded only after an open,competitive bidding process which has been
approved by City's Director of Purchasing and which allows qualified contractors to reasonably
participate in the competitive bidding procedures; provided, however, that the open competitive
bidding process required herein need not follow the City's procurement requirements for City
improvements. Developer or Owner may submit its proposed bidding process to the City for
review and approval or disapproval prior to receipt of any funds hereunder.
(c) No disbursement of funds to Developer or Owner shall be made by City hereunder
unless and until all conditions precedent to payment specified elsewhere in this Agreement have
been satisfied and Developer or Owner files with City's Director of Housing and Citizen Services
11
a written request for payment signed by an officer of Developer that certifies (i) that the amounts
included in the request for payment have not been included in any prior request for payment, (ii)
that the improvements listed therein for which payment is sought have been completed in
accordance with the approved plans and specifications therefor, and(iii)that the improvements for
which payment is sought have been constructed so as to comply with City of Pueblo building codes
and Section 8 Housing Quality Standards.
(d) [reserved]
(e) Every contract for construction of improvements, and all lower tier covered
transactions, shall include a requirement that the contractor, subcontractor or vendor certify that
neither it nor its principal is debarred, suspended, proposed for debarment, declared ineligible or
voluntarily excluded from participation in any federally funded project.
(f) Developer and Owner shall, at Developer's and Owner's sole expense, provide for
relocation assistance to persons displaced as a result of the Project, if any, in accordance with the
Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended,
and applicable implementing regulations, and in accordance with 24 CFR 92.353.
16. RECOGNITION OF HUD, CITY.
In all printed materials, Project descriptions and other activities undertaken with funds
provided under this Agreement, Developer and Owner shall provide recognition that funds have
been provided by the U.S. Department of Housing and Urban Development and the City of Pueblo.
Recognition shall be accomplished by prominent disclosure of the role of HUD and the City in all
such printed materials and Project signage, if any.
17. AFFIRMATIVE FAIR HOUSING MARKETING PLAN.
For all programs assisting five or more households, Developer has established procedures
and will take steps necessary to affirmatively further Fair Housing in accordance with City
policies, attached hereto in Exhibit"F", and federal regulations codified at 24CFR570.487(b) and
24CFR92.351, respective of CDBG/HOME funding. Developer has submitted to the City HUD
Form 92243, Affirmative Fair Housing Marketing Plan, outlining its strategy to encourage those
who are least likely to apply for the services funded by this Agreement.
18. ENTIRE AGREEMENT; AMENDMENTS.
The provisions set forth in this Agreement, and all Exhibits and attachments to this
Agreement, constitute the entire and complete agreement of the parties hereto with respect to the
Project and supersede all prior written and oral agreements, understandings or representations
related thereto. No amendment or modification of this Agreement, and no waiver of any provision
of this Agreement, shall be binding unless made in writing and executed by the duly authorized
officers of the Developer, Owner, and City.
19. GOVERNING LAW AND VENUE.
12
This Agreement shall be governed by the laws of the State of Colorado. Venue for any
action arising under this Agreement or for the enforcement of this Agreement shall be in a state
court with jurisdiction located in Pueblo County, Colorado.
20. SIGNATURES.
The persons signing this Agreement on behalf of Developer and Owner respectively
represent and warrant that such persons and Developer and Owner have the requisite power and
authority to enter into, execute and deliver this Agreement and that this Agreement is a valid and
legally binding obligation of Developer and Owner enforceable against Developer and Owner, as
applicable, in accordance with its terms.
13
IN WITNESS WHEREOF, Developer, Owner, and the City have executed this Agreement
as of the date first above written and under the laws of the State of Colorado.
CITY OF PUEBLO,
ATTEST: n A Municipal Corporation
i
CFL7 By: �ee.✓
City Clerk Nicholas A. Gradisar, Mayor
[ SEAL ] Date:
DEVELOPER:
HOUSING AUTHORITY OF THE CITY OF
PUEBLO,COLORADO,a body corporate and
politic organized under the laws of Colorado
<J
By: •-a�.i
Frank D. Pacheco, Interim Executive Director
Date: 471 -2-2- 2
OWNER:
MOUNTAIN VIEW TOWNHOMES, LLLP,
a Colorado limited liability limited partnership
By: Mountain View MM, LLC, a
Colorado limited liability company, its general
partner
By: El Centro Pueblo Development
Corporation, Inc., a Colorado non-profit
corporation, its sole member
By '74A" °
Frank D. Pacheco, Secretary/Treasurer
Date: )74-.2-Z" Lc;Zc�
14
Reception 2177205
05/06/2020 10:46:20 AM
DEED OF TRUST
TI-IIS DEED OF TRUST, made this 30`h day of April 2020, between Mountain View Townhomes,
LLLP, a Colorado limited liability limited partnership, with an address of 201 South Victoria Avenue, Pueblo,
Colorado 81003,hereinafter referred to as"Grantor,"and the Public Trustee of the County of Pueblo,in the State of
Colorado,hereinafter referred to as"Trustee,"WITNESSETH:
WHEREAS,Grantor has entered into the City of Pueblo Affordable Housing Development Agreement dated
the 30'h day of April 2020 with the City of Pueblo,a Municipal Corporation,hereinafter referred to as the"Agreement;"
and
WHEREAS.the Grantor has executed a Promissory Note,hereinafter referred to as the"Note,"dated the 30th
day of April 2020 for the principal sum of Five Hundred Thousand and No/100 Dollars(U.S.S500,000.00),payable
to the order of the City of Pueblo, a Municipal Corporation, located at 1 City Hall Place,Pueblo, Colorado 81003,
which amount is an indebtedness of Grantor payable with interest in accordance with the terms of said Note;and,
WHEREAS, the Grantor is desirous of securing performance of all obligations of Grantor under said
Agreement and Note and payment of the indebtedness as specified therein.
NOW, THEREFORE, the Grantor, in consideration of the premises and for the purposes aforesaid, does
hereby grant,bargain,sell and convey unto Trustee in trust forever,for the use and benefit of the City of Pueblo,a
Municipal Corporation(the"Beneficiary"),the following described property,situated in the County of Pueblo,State
of Colorado to wit:
See Exhibit A
Also known as Mountain View Townhomes,Phase 2A
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 Note or any part thereof or payment as
specified therein,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 of a breach of any term of the Agreement.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 may declare a violation of any of the covenants herein contained and elect to advertise said property for
sale and demand such sale,then,upon filing notice of such election and demand for sale with the Trustee,who shall
upon receipt of such notice of election and demand for sale cause a copy of the same to be recorded in the recorder's
office of the county in which said real estate is situated,it shall and may be lawful for said Trustee to sell and dispose
of the same(en masse or in separate parcels,as the said Trustee may think best),and all the right,title and interest of
Grantor,its successors or assigns therein,at public auction at the south front door of the Court House,in the County
of Pueblo,State of Colorado,or on said premises, or any part thereof as may be specified in the notice of said sale,
for the highest and best price the same will bring in cash,four weeks'public notice having been previously given of
the time and place of such sale, by advertisement, weekly, in some newspaper of general circulation at that time
published in said County of Pueblo,a copy of which notice shall be mailed within ten days from the date of the first
publication thereof to the Grantor at the address herein given and to such person or persons appearing to have acquired
a subsequent record interest in said real estate at the address given in the recorded instrument;where only the county
and state is given as the address then such notice shall be mailed to the county seat, and to make and give to the
purchaser or purchasers of such property at such sale,a certificate or certificates in writing describing such property
purchased,and the sum or sums paid therefor,and the time when the purchaser or purchasers(or other person entitled
thereto)shall be entitled to a deed or deeds therefor,unless the same shall be redeemed as is provided by law;and said
Trustee shall,upon demand by the person or persons holding the same certificate of purchase,when said demand is
made,or upon demand by the person entitled to a deed to and for the property purchased,at the time such demand is
made,the time for redemption having expired,make and execute to such person or persons a deed or deeds to the said
property purchased,which said deed or deeds shall be in the ordinary form of a conveyance, and shall be signed,
DEED OF TRUST
THIS DEED OF TRUST, made this 30th day of April 2020, between Mountain View Townhomes,
LLLP, a Colorado limited liability limited partnership, with an address of 201 South Victoria Avenue, Pueblo,
Colorado 81003, hereinafter referred to as "Grantor," and the Public Trustee of the County of Pueblo, in the State of
Colorado,hereinafter referred to as"Trustee," WITNESSETH:
WHEREAS,Grantor has entered into the City of Pueblo Affordable Housing Development Agreement dated
the 30th day of April 2020 with the City of Pueblo,a Municipal Corporation,hereinafter referred to as the"Agreement;"
and
WHEREAS,the Grantor has executed a Promissory Note,hereinafter referred to as the"Note,"dated the 30th
day of April 2020 for the principal sum of Five Hundred Thousand and No/100 Dollars(U.S.$500,000.00),payable
to the order of the City of Pueblo, a Municipal Corporation, located at 1 City Hall Place, Pueblo, Colorado 81003,
which amount is an indebtedness of Grantor payable with interest in accordance with the terms of said Note;and,
WHEREAS, the Grantor is desirous of securing performance of all obligations of Grantor under said
Agreement and Note and payment of the indebtedness as specified therein.
NOW, THEREFORE, the Grantor, in consideration of the premises and for the purposes aforesaid, does
hereby grant, bargain, sell and convey unto Trustee in trust forever, for the use and benefit of the City of Pueblo, a
Municipal Corporation(the "Beneficiary"),the following described property,situated in the County of Pueblo, State
of Colorado to wit:
See Exhibit A
Also known as Mountain View Townhomes,Phase 2A
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 Note or any part thereof or payment as
specified therein,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 of a breach of any term of the Agreement,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 may declare a violation of any of the covenants herein contained and elect to advertise said property for
sale and demand such sale,then, upon filing notice of such election and demand for sale with the Trustee, who shall
upon receipt of such notice of election and demand for sale cause a copy of the same to be recorded in the recorder's
office of the county in which said real estate is situated,it shall and may be lawful for said Trustee to sell and dispose
of the same(en masse or in separate parcels,as the said Trustee may think best),and all the right,title and interest of
Grantor,its successors or assigns therein,at public auction at the south front door of the Court House, in the County
of Pueblo, State of Colorado, or on said premises, or any part thereof as may be specified in the notice of said sale,
for the highest and best price the same will bring in cash, four weeks' public notice having been previously given of
the time and place of such sale, by advertisement, weekly, in some newspaper of general circulation at that time
published in said County of Pueblo, a copy of which notice shall be mailed within ten days from the date of the first
publication thereof to the Grantor at the address herein given and to such person or persons appearing to have acquired
a subsequent record interest in said real estate at the address given in the recorded instrument; where only the county
and state is given as the address then such notice shall be mailed to the county seat, and to make and give to the
purchaser or purchasers of such property at such sale, a certificate or certificates in writing describing such property
purchased,and the sum or sums paid therefor,and the time when the purchaser or purchasers(or other person entitled
thereto)shall be entitled to a deed or deeds therefor,unless the same shall be redeemed as is provided by law;and said
Trustee shall, upon demand by the person or persons holding the same certificate of purchase, when said demand is
made,or upon demand by the person entitled to a deed to and for the property purchased,at the time such demand is
made,the time for redemption having expired,make and execute to such person or persons a deed or deeds to the said
property purchased, which said deed or deeds shall be in the ordinary form of a conveyance, and shall be signed,
3 S
acknowledged and delivered by the said Trustee,as grantor,and shall convey and quit-claim to such person or persons
entitled to such deed,as grantee,the said property purchased as aforesaid and all the right,title, interest, benefit and
equity of redemption of the Grantor, its successors and assigns therein,and shall recite the sum or sums for which the
said property was sold and shall refer to the power of sale therein contained, and to the sale or sales made by virtue
thereof; and in case of an assignment of such certificate or certificates of purchase, or in case of the redemption of
such property, by a subsequent encumbrancer, such assignment or redemption shall also be referred to in such deed
or deeds; but the notice of sale need not be set out in such deed or deeds and the said 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 the indebtedness,all moneys and amounts due,according to the tenor
and effect thereof, and all moneys advanced by such Beneficiary or legal holder of said indebtedness for insurance,
taxes and assessments,with interest thereon at twelve percent per annum,rendering the overplus, if any,unto the said
Grantor,his legal representatives or assigns; which sale or sales and said deed or deeds so made shall be a perpetual
bar, both in law and equity, against the Grantor, its successors and assigns, and all other persons claiming the said
property,or any part thereof,by,from,through or under said Grantor, or any of them. The Beneficiary or holders of
the indebtedness may purchase said property or any part thereof;and it shall not be obligatory upon the purchaser or
purchasers at such sale to see to the application of the purchase money. If a release deed be required, it is agreed that
Grantor,its successors,and assigns,will pay the expense thereof.
And the Grantor, for itself and for its successors and assigns covenants and agrees to and with the 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 property as a Homestead Exemption,or other exemption,now existing or which may
hereafter be enacted in relation thereto and that,subject to the stated title exceptions attached hereto in Exhibit B,the
same are free and clear of all liens and encumbrances whatsoever, and the above bargained property shall be in the
quiet and peaceable possession of the said Trustee,his successors and assigns,against all and every person or persons
lawfully claiming or to claim the whole or any part thereof, the said Grantor shall and will Warrant and Forever
Defend.
And that during the continuance of said Note or the indebtedness arising thereunder,the said Grantor will in
due season pay all taxes and assessments levied on said property;all amounts due on account of principal and interest
on prior encumbrances, if any;and will keep all buildings that may at any time be on said lands, insured against loss
by fire with extended coverage endorsements in a company authorized to issue such insurance in the State of Colorado,
for such sum or sums as such company or companies will insure for, not to exceed the amount of said indebtedness
and any prior encumbrances, except at the option of said Grantor, with loss, if any, payable to the Beneficiary
hereunder,as its interest may appear,and will deliver the policy or policies of insurance to the Beneficiary hereunder,
as further security for the indebtedness aforesaid. And in case of the failure of Grantor to thus insure and deliver the
policies of insurance,or to pay such taxes or assessments or amounts due or to become due on any prior encumbrances,
if any,then the Beneficiary or Note Holder(as such term is defined in the Note) may procure such insurance,or pay
such taxes or assessments or amount due upon prior encumbrances, if any, and all moneys thus paid, with interest
thereon at twelve percent per annum, shall become so much additional indebtedness, secured by this Deed of Trust,
and shall be paid out of the proceeds of the sale of the property aforesaid, if not otherwise paid by Grantor, and
Beneficiary or Note Holder may for such failure declare a violation of this covenant and agreement.
If all or any part of the property or an interest therein is sold or transferred by Grantor without Beneficiary's
prior written consent,excluding the creation of a lien or encumbrance subordinate to this Deed of Trust, Beneficiary
may,at Beneficiary's option,declare all the sums secured by this Deed of Trust to be immediately due and payable,
together with interest thereon at the rate of four percent(4%) per annum from the time of substantial completion of
the Project until said repayment is made.
AND THAT IN CASE OF ANY DEFAULT, Including but not limited to any breach of the affordability
requirements detailed in the Agreement,Note,or as otherwise may be required pursuant to 24 C.F.R.Part 92,whereby
the right of foreclosure occurs hereunder,the Trustee or the Beneficiary or holder of certificate of purchase, shall at
once become entitled to the possession,use and enjoyment of the property aforesaid,and to the rents,issues and profits
thereof,from the accruing of such right and during the pendency of foreclosure proceedings and through the period of
redemption, if any there be; and such possession shall at once be delivered to the Trustee or the Beneficiary or the
holder of the certificate of purchase on request, and on refusal, the delivery of such possession may be enforced by
the Trustee or the Beneficiary or holder of the certificate of purchase by any appropriate civil suit or proceeding,and
the Trustee or Beneficiary or the holder of the certificate of purchase, or any thereof, shall be entitled to a Receiver
for said property, 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 property 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 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 case of default in any of said payments of principal or interest,according to the tenor and effect
of said Note aforesaid, or any part thereof, or a breach of any term of the Agreement, or of a breach or violation of
any of the covenants or agreements herein, by the Grantor, its successors or assigns,then and in that case the whole
of the indebtedness hereby secured,and the interest thereon to the time of the sale, may at once, at the option of the
Beneficiary or the legal holder of the indebtedness, become due and payable, and the said property 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,a reasonable attorney's fee for services in the supervision of said foreclosure proceedings shall be allowed by
the Public Trustee as part of the cost of foreclosure, and if foreclosure be made through the courts a reasonable
attorney's fee shall be taxed by the court as a part of the costs of such foreclosure proceedings.
The final payment of the Note and performance of the Agreement and other obligations secured by this Deed
of Trust are due on July 31,2041.
Notwithstanding anything to the contrary contained in this Deed of Trust or the Note being secured hereby,
Equity Investor(as defined below)shall have the right,but not the obligation,to cure defaults of Grantor.
Any notice from the Beneficiary to the Grantor under this Deed of Trust shall be deemed to have been
received by the Grantor three(3)days after being mailed by certified mail,return receipt requested,to the Grantor at
201 South Victoria Avenue, Pueblo, CO 81003, or at such other address as Grantor may designate in writing to
Beneficiary. Copies of any and all notices given by Beneficiary to the Grantor shall be sent, in the same manner as
such notice is given to the Grantor,to the Grantor's limited partner(the"Equity Investor")at the following address:
USA Mountain View Townhomes LLC c/o The Richman Group Capital Corporation at 777 West Putnam Avenue,
Greenwich, CT 06830, Attention: Joanne D. Flanagan, Esq. Equity Investor may change its address for receipt of
copies of notices by giving notice in writing stating its new address to the Beneficiary. Commencing on the tenth
(10th) day after the giving of such notice, such newly designated address shall be effective for purposes of all such
copies of notices required to be sent by the Beneficiary to the Equity Investor.
Nothing in this Deed of Trust is intended,nor shall it be construed,to grant any rights whatsoever to Grantor
or create any condition precedent to the exercise of any right or remedy by the Beneficiary; nor shall any
noncompliance with the requirements of this Deed of Trust constitute any defense against enforcement of the Note or
this Deed of Trust, including without limitation, Beneficiary's right to accelerate maturity of the entire indebtedness
and demand sale of the said property.
The person signing this Deed of Trust on behalf of the Grantor represents and warrants that he or she has the
requisite power and authority to enter into, execute, and deliver this Deed of Trust on behalf of the Grantor and that
this Deed is a valid and legally binding obligation of Grantor enforceable against it in accordance with its terms.
Should any provisions of this Deed of Trust be found to violate the statutes or court decisions of the State of
Colorado,or of the United States,such provision shall be deemed to be amended to comply with and conform to such
statutes and decisions.
RAD Rider. The RAD Rider attached to this Deed of Trust as Exhibit C is, by this reference, incorporated
into and deemed a part of this Deed of Trust. In the event of a conflict between any provisions of this Deed of Trust
and any provisions of the RAD Rider,the provisions of the RAD Rider shall control.
IN WITNESS, WHEREOF,the Grantor has hereunto set its hand and seal the day and year first above written.
GRANTOR:
MOUNTAIN VIEW TOWNHOMES, LLLP, a
Colorado limited liability limited partnership
By: Mountain View MM, LLC,
a Colorado limited liability company, its general
partner
By: El Centro Pueblo Development
Corporation, Inc.,
a Colorado non-profit corporation, its sole member
By ----
Frank D. Pacheco, Secretary/Treasurer
STATE OF COLORADO
ss.
COUNTY OF ()LAI-VAC )
The foregoing instrument was acknowledged before me in 1 b1 0 County,Colorado,this
day of f t , 2020 by r-u rv� f (ft)/(v, as ,Sex-, v.e ;'-on behalf of
Mountain View Townhomes,LLLP,A Colorado Limited Liability Limited Partnership.
Witness my hand and official seal.
My commission expires: A3/0`g 12 C.2—`1
[SEAL] etx.
Notary Public
CHERYL L. WILKERSON
NOTARY PUBLJC
STATE OF COLORADO
NOTARY ID# 19964004153
MY COMMISSION EXPIRES 03/08/2024
Exhibit A
To
Deed of Trust
LEGAL DESCRIPTION
Lot 1,Tracts A and B, Uplands Townhomes Filing No.2, Recorded December 6,2019 under reception No.
2161535,County of Pueblo,State of Colorado
Also known as street and number:
1402, 1406, 1410, 1414, 1401, 1405, 1409, 1413, 1431, 1435, 1439, 1443, 1432, 1436, 1440, 1444
Li pan Place;
1402, 1406, 1410, 1414, 1401, 1405, 1409, 1413, 1431, 1435, 1439, 1443, 1432, 1436, 1440, 1444
Wichita Place;
1402, 1406, 1410, 1414, 1431, 1433, 1435, 1439, 1443, 1445, 1432, 1434, 1436, 1440, 1444, 1446
Mandan Place;
and,2501, 2505,2509 Lakota Place.
EXHIBIT B
TO
DEED OF TRUST
TITLE EXCEPTIONS
TAXES AND ASSESSMENTS FOR THE YEAR 2020 AND SUBSEQUENT YEARS, A LIEN NOT YET
DUE AND PAYABLE. NONE CURRENTLY DUE.
BOUNDARY LINES AS SHOWN ON THE PLAT OF UPLANDS PARK RECORDED FEBRUARY 19,
1886 IN PLAT BOOK U AT PAGE 16. (AFFECTS UPLANDS PARK)
UTILITY EASEMENTS ON THE PLAT OF HOUSING SUBDIVISION RECORDED MAY 24, 1952
UNDER RECEPTION NO. 913457. (AFFECTS HOUSING SUBDIVISION)
EASEMENT GRANTED TO PUEBLO GAS AND FUEL COMPANY, FOR GAS PIPELINE, AND
INCIDENTAL PURPOSES, BY INSTRUMENT RECORDED JULY 06, 1953, IN BOOK 1214 AT PAGE
1. (AFFECTS BLOCKS 1 TO 3, HOUSING SUBDIVISION)
THE EFFECT OF INCLUSION OF SUBJECT PROPERTY IN THE PUEBLO CONSERVANCY
DISTRICT, AS EVIDENCED BY INSTRUMENT RECORDED AUGUST 01, 2007, UNDER
RECEPTION NO. 1736292 AND RECORDED FEBRUARY 15, 2013 UNDER RECEPTION NO.
1934215 AND PUEBLO CONSERVANCY DISTRICT MAP RECORDED DECEMBER 11, 2009 UNDER
RECEPTION NO. 1829096. NO TAXES, LIENS, FEES OR ASSESSMENTS DUE OR PAYABLE AS
OF THE DATE OF POLICY.
TERMS, CONDITIONS, PROVISIONS, BURDENS, OBLIGATIONS AND EASEMENTS AS SET
FORTH AND GRANTED IN GRANT OF EASEMENT RECORDED MARCH 14, 2018 UNDER
RECEPTION NO. 2099376. (AFFECTS BLOCKS 1 TO 3, HOUSING SUBDIVISION)
THE EFFECT OF ORDINANCE NO. 9376, AN ORDINANCE AMENDING ZONING RESTRICTIONS
RECORDED DECEMBER 06, 2018 UNDER RECEPTION NO. 2124936.
TERMS, CONDITIONS, PROVISIONS AND OBLIGATIONS CONTAINED IN DEVELOPMENT GUIDE
FOR UPLANDS TOWNHOMES PHASE 2, PLANNED UNIT DEVELOPMENT RECORDED
DECEMBER 06, 2018, UNDER RECEPTION NO. 2124937.
EASEMENTS, CONDITIONS, COVENANTS, RESTRICTIONS, RESERVATIONS AND NOTES ON
THE PLAT OF UPLAND TOWNHOMES FILING NO. 2 RECORDED DECEMBER 6, 2019 UNDER
RECEPTION NO. 2161535.
ORDINANCE NO. 9432 VACATING A PORTION OF CRAWFORD STREET AND SITTER PLACE
RECORDED DECEMBER 6, 2019 UNDER RECEPTION NO. 2161532.
STREET VACATION RECORDED DECEMBER 6, 2019 UNDER RECEPTION NO. 2161533.
ORDINANCE NO. 9433 APPROVING THE UPLANDS TOWNHOMES, FILING NO. 2 PLAT
RECORDED DECEMBER 6, 2019 UNDER RECEPTION NO. 2161534.
TERMS, CONDITIONS, PROVISIONS, BURDENS AND OBLIGATIONS AS SET FORTH IN
SUBDIVISION IMPROVEMENTS AGREEMENT RECORDED DECEMBER 06, 2019 UNDER
RECEPTION NO. 2161536.
EXHIBIT C
TO
DEED OF TRUST
RAD RIDER
This RAD Rider to Loan Documents(the"Rider") modifies the Deed of Trust(HOME)(the "Deed of Trust") and
any documents executed in connection therewith entered into between the City of Pueblo, a municipal corporation
("Lender")and Mountain View Townhomes, LLLP, a Colorado limited liability limited partnership ("Borrower"),
in connection with a loan by Lender to Borrower (the "Loan") to be used in financing five (5) units of affordable
housing in a 51-unit affordable housing rental development of which 47 of the units are RAD (defined below) units
known as Mountain View Townhomes (the"Project") on the property described in Exhibit A to the Deed of Trust
(the"Property").
WHEREAS,the Loan is evidenced and/or secured by the following documents and agreements(collectively
with all other agreements, instruments and documents now or hereafter executed in connection with the Loan, all as
may be amended,supplemented or replaced from time to time in accordance with the terms thereof,the"Subordinate
Documents"):
A. This Deed of Trust by and between Borrower and the Public Trustee of the County of Pueblo,
Colorado for the benefit of Lender;
B. City Promissory Note securing this Deed of Trust; and,
C. City of Pueblo Affordable Housing Development Agreement by and between the City of Pueblo,a
Municipal Corporation,and Mountain View Townhomes,LLLP,a Colorado limited liability limited
partnership;and
WHEREAS,the U.S. Department of Housing and Urban Development("HUD") has authorized, as part of
the Project, the conversion of public housing to Section 8 assistance under the Rental Assistance Demonstration
("RAD")program, pursuant to Public Law 112-55,as amended;and
WHEREAS, the Project will be assisted by funding provided pursuant to the RAD program, thereby
subjecting the Project to requirements contained in that certain RAD Conversion Commitment(Form HUD-52624)
("RCC"),executed by HUD,Borrower and Lender with respect to conversion of public housing units to RAD units;
and
WHEREAS,as a condition of the RAD conversion, Borrower executed a Rental Assistance Demonstration
Use Agreement dated and recorded as of substantially even date herewith(the"RAD Use Agreement")for the benefit
of HUD;and
WHEREAS, HUD requires as a condition of the RAD conversion that Lender and Borrower agree to
subordinate the Subordinate Documents to the RAD Use Agreement.
NOW THEREFORE, let it be known to all interested parties, that for good and valuable consideration,the
receipt of which is hereby acknowledged,the undersigned do hereby agree:
1. So long as the RAD Use Agreement,and all extensions thereto,is in effect,the Subordinate Documents shall
unconditionally be and remain at all times subject in all respects to the Program Requirements(as defined in
Section I of that certain RCC)and subordinate to the RAD Use Agreement.
2. Subordination to the RAD Use Agreement shall extend to and continue in effect with respect to any future
amendment, extension, renewal, or any other modification of the RAD Use Agreement or the Subordinate
Documents.
3. In the event of a conflict between a Subordinate Document and the RAD Use Agreement, the RAD Use
Agreement shall control.
r
4. The following amendments to the Subordinate Documents require the prior written consent of HUD:(i)any
amendment to any HUD-required provisions in the Subordinate Documents, (ii) an increase in the interest
rate of the Loan,(iii)an increase of the total indebtedness of the Loan,(iv)an acceleration of the amortization
or payment schedule of the Loan,and(v)any changes that would preclude or impair a reasonable opportunity
to cure any defaults by Borrower under the Subordinate Documents.
5. Subordination to the RAD Use Agreement is intended to survive any bankruptcy and foreclosure filed by
Borrower.
6. This Rider may be signed in counterparts.
7. The invalidity,in whole or in part,of any of the provisions set forth in this Rider,shall not affect or invalidate
any remaining provisions.
8. This Rider and every covenant hereof shall be binding upon Lender and Borrower and their respective
successors and assigns. This Rider shall not be modified or amended except by a written instrument executed
by all parties hereto and approved in writing by HUD.
IN WITNESS WHEREOF,the Borrower and Lender have duly executed and delivered this Rider contemporaneous
with the Loan Documents.
BORROWER:
MOUNTAIN VIEW TOWNHOMES, LLLP,a Colorado
limited liability limited partnership
By: Mountain View MM, LLC,
a Colorado limited liability company, its general partner
By: El Centro Pueblo Development Corporation, Inc.,
a Colorado non-profit corporation, its sole member
B .
GL4D (-
Frank D. Pacheco,Secretary
Date: 41/ O't)/dOch.)
LENDER:
tf:? CITY OF PUEBLO,a municipal corporation
' :•, 21.,:olielice"c‘x....,7
//. ikh�,.`�, �, Nicholas A.Gradisar, Mayor
„�:: r < 9;112*•014 0
..,Nv,,ter.. „.c�,, D te:
ij
Reception 2177209
05/06/2020 10:46:20 AM
THIS DOCUMENT PREPARED BY AND
r= AFTER RECORDING RETURN TO:
CO)
Kutak Rock LLP
8601 N. Scottsdale Road,Suite 300
Scottsdale.Arizona 85253
Attn: Heather Aeschleman
SPACE ABOVE LINE FOR RECORDER'S USE
SUBORDINATION AGREEMENT
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN CERTAIN INTERESTS IN
THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE
LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT.
THIS SUBORDINATION AGREEMENT("Agreement')is made as of May 1,2020, by and
among MOUNTAIN VIEW TOWNHOMES, LLLP, a Colorado limited liability limited
partnership,having its principal place of business at 201 South Victoria Avenue, Pueblo,
Colorado 81003 ("Borrower"),the Housing Authority of the City of Pueblo, Colorado, a body
corporate and politic of the State of Colorado,having its principal place of business at is 201
South Victoria Avenue,Pueblo,Colorado 81003, (the"Housing Authority"),and the City of
Pueblo, a Municipal Corporation,having its principal place of business at 1 City Hall Place,
Pueblo, Colorado 81003 (the"City"; and together with the Housing Authority, each a"Junior
Lienholder"and jointly, the"Junior Lienholders") and U.S.BANK NATIONAL
ASSOCIATION, a national banking association, having an address at 1307 Washington Avenue,
Suite 300, St. Louis,Missouri 63103, as beneficiary("Bank")
RECITALS
A. Borrower owns and intends to construct a 51-unit affordable housing townhome
project located in the County of Pueblo, State of Colorado (the"Project"),as legally described on
Exhibit A attached hereto.
B. Borrower has applied to Bank for a construction loan(the "Loan") in the original
principal amount of $8,981,521, for the purpose of financing a portion of the costs of the
acquisition and construction of the Project.
4847-5035-7925.5 3 A1-15 7,s-,
THIS DOCUMENT PREPARED BY AND
AFTER RECORDING RETURN TO:
Kutak Rock LLP
8601 N. Scottsdale Road, Suite 300
Scottsdale,Arizona 85253
Attn: Heather Aeschleman
SPACE ABOVE LINE FOR RECORDER'S USE
SUBORDINATION AGREEMENT
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN CERTAIN INTERESTS IN
THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE
LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT.
THIS SUBORDINATION AGREEMENT("Agreement") is made as of May 1, 2020, by and
among MOUNTAIN VIEW TOWNHOMES, LLLP, a Colorado limited liability limited
partnership, having its principal place of business at 201 South Victoria Avenue, Pueblo,
Colorado 81003 ("Borrower"), the Housing Authority of the City of Pueblo, Colorado, a body
corporate and politic of the State of Colorado, having its principal place of business at is 201
South Victoria Avenue, Pueblo, Colorado 81003, (the "Housing Authority"), and the City of
Pueblo, a Municipal Corporation, having its principal place of business at 1 City Hall Place,
Pueblo, Colorado 81003 (the "City"; and together with the Housing Authority, each a "Junior
Lienholder" and jointly, the "Junior Lienholders") and U.S. BANK NATIONAL
ASSOCIATION, a national banking association, having an address at 1307 Washington Avenue,
Suite 300, St. Louis, Missouri 63103, as beneficiary ("Bank")
RECITALS
A. Borrower owns and intends to construct a 51-unit affordable housing townhome
project located in the County of Pueblo, State of Colorado (the "Project"), as legally described on
Exhibit A attached hereto.
B. Borrower has applied to Bank for a construction loan (the "Loan") in the original
principal amount of $8,981,521, for the purpose of financing a portion of the costs of the
acquisition and construction of the Project.
1
4847-5035-7925.5 3 : S 75'(p
C. Borrower and Bank have entered into that certain Construction Loan Agreement
dated as of the date hereof(as the same from time to time may be amended, modified, extended,
renewed or restated, the "Loan Agreement").
D. Borrower's obligations to repay the Loan are further evidenced by that certain
Construction Loan Note dated as of even date herewith executed by Borrower and payable to
Lender in the original principal amount of the Loan (as the same from time to time may be
amended, modified, extended, renewed or restated, the "Note).
E. Each of the documents listed on Exhibit"B"together with all other documents and
materials entered into with a Junior Lienholder with respect to the loans made by Junior
Lienholders to the Borrower shall be referred to collectively as the "Junior Obligation
Documents".
F. As used herein, the term "Junior Obligations" means any and all indebtedness,
claims, debts, liabilities or other obligations from Borrower to a Junior Lienholder under its
respective Junior Obligation Documents (as set forth on Exhibit B), together with all costs and
expenses, including attorneys' fees, of collection thereof, whether the same accrues or is incurred
before or after the commencement of any bankruptcy case by or against Borrower.
G. Borrower's obligations to Bank under the Loan Agreement and the Note are
secured by, among other things, (i)that certain Construction Deed of Trust, Assignment of Leases
and Rents, Security Agreement and Fixture Filing dated as of even date herewith made by
Borrower for the benefit of Bank(the"Senior Mortgage"),and(ii)the Loan Documents described
in the Loan Agreement. The Senior Mortgage is being recorded substantially concurrently
herewith in the official records of the County of Pueblo, State of Colorado ("Official Records").
The Senior Mortgage, the Loan Agreement, the Note and the other Loan Documents (as defined
in the Loan Agreement), as such documents may be amended, restated or replaced from time to
time, are hereinafter collectively referred to as the "Senior Loan Documents".
H. As used herein, the term "Bank Indebtedness" means any and all indebtedness,
claims, debts, liabilities or other obligations from Borrower to Bank under the Senior Loan
Documents, together with all interest accruing thereon and all costs and expenses, including
attorneys' fees, of collection thereof, whether the same accrues or is incurred before or after the
commencement of any bankruptcy case by or against Borrower.
I. Pursuant to the Senior Mortgage and the other Senior Loan Documents, Borrower
is not entitled to further encumber the Property without the prior written consent of Bank, which
consent may be withheld in Bank's sole discretion.
J. It is a condition precedent to Bank to entering into the Senior Loan Documents and
permitting the recordation of any of the Junior Obligation Documents that the Senior Mortgage
and the other Senior Loan Documents be and remain at all times a lien or charge upon the Property,
prior and superior to the liens or charges of the Junior Obligation Documents.
K. Bank is willing to permit the recordation of the recordable Junior Obligation
Documents,provided that(1) the Senior Mortgage and the other Senior Loan Documents are a lien
or charge upon the Property prior and superior to the liens or charges of the Junior Obligation
2
4847-5035-7925.5
Documents, and (2) Junior Lienholders will specifically subordinate the liens or charges of the
Junior Obligation Documents to the lien or charge of the Senior Loan Documents.
L. Junior Lienholders are willing to agree that the Senior Loan Documents shall
constitute a lien or charge upon the Property which is prior and superior to the liens or charges of
Junior Lienholders' Junior Obligation Documents. The parties hereto enter into this Agreement
for the purposes set forth in these Recitals.
M. Capitalized terms used herein and not otherwise defined shall have the meanings
set forth for them in the Loan Agreement.
AGREEMENT
NOW,THEREFORE,in consideration of the mutual benefits accruing to the parties hereto
and other valuable consideration, the receipt and sufficiency of which consideration is hereby
acknowledged, and in order to induce Bank to make the Loan, it is hereby declared, understood,
and agreed as follows:
1. Priority of Senior Mortgage. The Senior Mortgage in favor of Bank, and all
amendments, modifications, extensions and renewals thereof shall unconditionally be and remain
at all times a lien or charge on the Property prior and superior to the lien or charge of the Junior
Obligation Documents. Each Junior Lienholder intentionally and unconditionally subordinates the
lien or charge of its respective Junior Obligation Documents in favor of the lien or charge upon
said land of the Property in favor of Bank, and understands that in reliance upon and in
consideration of this subordination, specific loans and advances are being and will be made and,
as part and parcel thereof, specific monetary and other obligations are being and will be entered
into which would not be made or entered into but for said reliance upon this subordination.
2. Only Agreement Regarding Subordination. Bank would not permit the recordation
of any Junior Obligation Documents without this Agreement. This Agreement shall be the whole
and only agreement with regard to the subordination of the lien or charge of the Junior Obligation
Documents to the lien or charge of the Senior Mortgage (except with respect to the subordination
provisions contained in the Junior Obligation Documents, to the extent not inconsistent with any
provision in this Agreement).
3. Loan Disbursements. In making disbursements pursuant to any of the Senior Loan
Documents, Bank is under no obligation or duty to, nor has Bank represented that it will, see to
the application of such proceeds by the person or persons to whom Bank disburses such proceeds,
and any application or use of such proceeds for purposes other than those provided for in such
Senior Loan Documents shall not defeat the subordination herein made in whole or in part.
4. Consent and Approval. Junior Lienholders have received and consent to and
approve the Senior Loan Documents, including but not limited to any extension, modification
and/or amendment of said agreements, between Borrower and Bank. No decision by a Junior
Lienholder to review or not review the Senior Loan Documents, including but not limited to the
disbursement provisions contained therein,shall impair or otherwise limit the enforceability of this
Agreement.
3
4847-5035-7925.5
5. Other Agreements. Junior Lienholders and Borrower declare, agree, and
acknowledge that:
5.1 Subordination of Indebtedness. Any and all Junior Obligations are hereby
subordinated and subject to any and all Bank Indebtedness, as set forth herein.
5.2 Permitted Payments. Borrower may make payments under the Junior
Obligation Documents, if required, as long as all payments under the Senior Mortgage and the
other Senior Loan Documents are current and not delinquent or in arrears, and only so long as at
the time of such payment: (i)no Event of Default(as defined in the Loan Agreement) exists under
the Loan Agreement and no event exists which, with the lapse of time or the giving of notice or
both, would be an Event of Default under the Bank Indebtedness of which a Junior Lienholder has
received notice; and(ii) the payment would not result in a violation of any of Borrower's financial
covenants set forth in any of the documents evidencing the Loans ("Permitted Payments").
Borrower must make any payments under the Junior Obligation Documents that may be required
by federal law.
5.3 Payment Subordination. Except for any Permitted Payments, (a) all of the
Bank Indebtedness now or hereafter existing shall be first paid in full by Borrower before any
payment shall be made by Borrower on the Junior Obligations, and (b) this priority of payment
shall apply at all times until all of the Bank Indebtedness has been repaid in full. In the event of
any assignment by Borrower for the benefit of Borrower's creditors, or any bankruptcy
proceedings instituted by or against Borrower, or the appointment of any receiver for Borrower or
Borrower's business or assets, or of any dissolution or other winding up of the affairs of Borrower
or of Borrower's business,and in all such cases respectively,Borrower's officers and any assignee,
trustee in bankruptcy, receiver and other person or persons in charge are hereby directed to pay to
Bank the full amount of the Bank Indebtedness before making any payments to Junior Lienholders
due under the Junior Obligations.
5.4 Return of Prohibited Payments. Except as otherwise expressly agreed to
herein,if a Junior Lienholder shall receive any payments in connection with the Junior Obligations
in violation of this Agreement, such payment shall immediately be delivered and transferred to
Bank after written notice to Junior Lienholders.
5.5 Repayment of Bank Indebtedness. This Agreement shall remain in full
force and effect until all amounts due under the Note and the Loan Agreement are fully repaid in
accordance with the terms of the Senior Loan Documents and all of the terms of this Agreement
have been complied with.
5.6 Standstill. Each Junior Lienholder agrees that, without the Bank's prior
written consent, it will not accelerate the Junior Obligations, commence foreclosure proceedings
with respect to the Property, collect rents, appoint (or seek the appointment of) a receiver or
institute any other collection or payment enforcement action, provided that nothing herein shall
limit the City's right to seek specific performance of the City Regulatory Agreement (as defined
in Exhibit B).
4
4847-5035-7925.5
5.7 Assignment or Modification of Junior Obligation Documents. The
Borrower and the Housing Authority agree that, until the principal of, interest on and all other
amounts payable under the Senior Loan Documents have been paid in full, it will not, without the
prior written consent of the Bank in each instance, amend or modify any provisions of the Housing
Authority Documents described on the attached Exhibit B. The Housing Authority further agrees
that it may not assign any portion of its respective interest in the Housing Authority Documents
without the prior written consent of Bank. The City shall provide Bank written notice at least ten
(10) days prior to any amendment or modification to the City Loan Documents described on the
attached Exhibit B, at the address set forth in the recitals above, or such other address as Bank
may instruct in writing from time to time.
5.8 Assignment or Modification of Loan and Senior Loan Documents. Junior
Lienholders acknowledges and agrees that Bank, at any time, shall have the right to sell, assign,
transfer, or negotiate the Loan and the Senior Loan Documents, in whole or in part, and to grant
participation interests in the Loan and the Senior Loan Documents, without the consent of any
Junior Lienholder. Junior Lienholders acknowledges and agrees that Bank may amend or modify
any provision of the Senior Loan Documents without the consent of any Junior Lienholder.
6. Bank Agreements.
6.1 Bank agrees that it shall not complete a foreclosure sale of the Property or
record a deed-in-lieu of foreclosure with respect to the Property (each, a"Foreclosure Remedy")
unless the Junior Lienholders have first been given thirty (30) days written notice of the Event(s)
of Default giving Bank the right to complete such Foreclosure Remedy, and unless Junior
Lienholders have failed, within such thirty (30) day period (the "Cure Period"), to cure such
Event(s) of Default; provided, however, that Bank shall be entitled during the Cure Period to
continue to pursue all of its rights and remedies under the Senior Loan Documents, including, but
not limited to, acceleration of the Loan (subject to any de-acceleration provisions specifically set
forth in the Senior Loan Documents), commencement and pursuit of a judicial or non judicial
foreclosure (but not completion of the foreclosure sale), appointment of a receiver, enforcement
of any guaranty (subject to any notice and cure provisions contained therein), and/or enforcement
of any other Senior Loan Document. In the event Bank has accelerated the Loan and a Junior
Lienholder cures all Events of Default giving rise to such acceleration within the Cure Period, such
cure shall have the effect of de-accelerating the Loan;provided,however,that such de-acceleration
shall not waive or limit any of Bank's rights to accelerate the Loan or exercise any other remedies
under the Senior Loan Documents as to any future or continuing Events of Default. It is the express
intent of the parties hereunder that Bank shall have the right to pursue all rights and remedies
except completion of a Foreclosure Remedy without liability to the Junior Lienholders for failure
to provide timely notice to the Junior Lienholders required hereunder, and that Bank's liability
hereunder shall be expressly limited to actual and consequential damages to the Junior Lienholders
directly caused by Bank's completion of a Foreclosure Remedy without the Junior Lienholders
receiving the notice and opportunity to cure described above. Bank shall give Junior Lienholders
notice at the address set forth below or such other address as Junior Lienholder may instruct Bank
in writing from time to time
Housing Authority of the City of Pueblo, Colorado
201 South Victoria Avenue
5
4847-5035-7925.5
Pueblo, CO 81003
Attention: Frank D. Pacheco, Interim Executive Director
City of Pueblo
1 City Hall Place
Pueblo, Colorado 81003
Attention: Mayor
6.2 Each Junior Lienholder shall also have the right to elect to purchase the
Loan from Bank for a purchase price ("Senior Loan Purchase Price") equal to the sum of(i) the
outstanding principal balance of the Loan on the Closing Date (as defined below), plus (ii) all
accrued and unpaid interest on the Loan through and including the Closing Date,plus(iii) all other
accrued and unpaid fees, costs and expenses payable by Borrower under the Senior Loan
Documents, plus (iv) all costs and expenses incurred by Bank in connection with the sale of the
Loan to Junior Lienholder, during the Cure Period, as follows: the Housing Authority may elect to
purchase the Loan within the initial fifteen(15) days of the Cure Period by sending written notice
(the "Election Notice") to Bank, and the City, and if the Housing Authority does not elect to
purchase the Loan within such fifteen (15) day period, then the City may elect to purchase the
Loan during the remainder of the Cure Period by sending an Election Notice to Bank. The sale of
the Loan by Bank to a Junior Lienholder under this Section shall be made (a) without recourse,
representation or warranty by Bank of any kind, express or implied, and (b) close on the date
("Closing Date") which is fifteen(15) days after such Junior Lienholder gives the Election Notice
to Bank. On the Closing Date,the applicable Junior Lienholder shall pay to Bank, in immediately
available funds and lawful monies of the United States of America, the Senior Loan Purchase
Price.
7. Bankruptcy Provisions.
7.1 In the event of any proceedings to liquidate, dissolve or wind up the
Borrower, or of any execution, sale, receivership, insolvency, bankruptcy, liquidation,
readjustment, reorganization, or other similar proceedings relative to the Borrower or its property
(a "Bankruptcy Proceeding"), to the fullest extent permitted by law, the payment and lien
priorities set forth in this Agreement shall be respected and enforced in any such Bankruptcy
Proceeding, and Junior Lienholders and Borrower agree not to contest such priorities in any
Bankruptcy Proceeding. Without limitation to the foregoing, the Loan shall be preferred in
payment over all of the Junior Obligations and shall be paid in full before any payment is made
upon any of the Junior Obligations; and any payment or distribution of any kind or character,
whether in cash, property or securities, made upon or in respect of any of the Junior Obligations
as a result of any such proceeding shall be paid over to the Bank for application in payment of the
Loan unless and until the Loan shall have been paid or satisfied in full. Each Junior Lienholder
agrees that during the term of this Agreement it will not commence, or join with any other creditor
in commencing, any Bankruptcy Proceeding with respect to the Borrower without (i) sixty (60)
days prior written notice to the Bank of such intent, and (ii) indefeasible payment in full of the
outstanding principal balance of and all accrued and unpaid interest under the Loan, together with
all other amounts secured by the Senior Mortgage. Upon the occurrence of any Bankruptcy
Proceeding with respect to the Borrower, each Junior Lienholder agrees to fully cooperate with
6
4847-5035-7925.5
Bank in connection with such Bankruptcy Proceeding and to refrain from taking any actions which
are inconsistent with the agreements contained in this Agreement. Without limitation to the
foregoing, Junior Lienholders shall (i) consent to and vote in favor of any and all actions taken by
Bank in any Bankruptcy Proceeding to permit the commencement or continuation of any
foreclosure of the Senior Mortgage; and (ii) not propose any plan, or vote to confirm or take any
other action in support of any plan or other course of action proposed by Borrower or any other
party (other than Bank), which would have the effect of(A) impairing the priority or lien of the
Loan, or (B) delaying, preventing, limiting, requiring a reduction in the amount of or impairing
Bank's collection of all or any portion of the Loan.
7.2 To the extent any payment under any Senior Loan Document (whether by
or on behalf of Borrower, as proceeds of security or enforcement of any right of set-off, or
otherwise) is declared to be fraudulent or preferential, set aside or required to be paid to a trustee,
receiver or other similar party in any Bankruptcy Proceeding, then if such payment is recovered
by, or paid over to, such trustee, receiver or other similar party, the Bank Indebtedness or part
thereof originally intended to be satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred.
8. Casualty Insurance Proceeds; Condemnation Proceeds. In the event Bank shall
release, for the purposes of restoration of all or any part of the improvements, its right, title and
interest in and to the proceeds under policies of insurance thereon,and/or its right,title and interest
in and to any awards, or its right, title and interest in and to other compensation made for any
damages, losses or compensation for other rights by reason of a taking in eminent domain, Junior
Lienholders shall simultaneously release (and each hereby agrees that it shall be irrevocably and
unconditionally deemed to have agreed to release) for such purpose all of Junior Lienholders'
respective right, title and interest, if any, in and to all such insurance proceeds, awards or
compensation. Junior Lienholders agree that the balance of such proceeds remaining after such
restoration, or all of such proceeds in the event Bank elects, in accordance with Colorado law, not
to release any such proceeds for any such restoration, shall be applied to the payment of amounts
due under the Senior Loan Documents until all such amounts have been paid in full,prior to being
applied to the payment of any amounts due under the Junior Obligation Documents. If Bank holds
such proceeds, awards or compensation and/or monitors the disbursement thereof, Junior
Lienholders agree that Bank may also elect, in its sole and absolute discretion,to hold and monitor
the disbursement of such proceeds, awards and compensation to which Junior Lienholders are or
may be entitled. Nothing contained in this Agreement shall be deemed to require Bank, in any
way whatsoever, to act for or on behalf of any Junior Lienholder or to hold or monitor any
proceeds, awards or compensation in trust for or on behalf of a Junior Lienholder, and all or any
of such sums so held or monitored may be commingled with any funds of Bank.
9. Effect of Other Agreements. The relationship between Borrower and Bank under
the Senior Loan Documents is, and shall at all times remain, solely that of borrower and lender.
Based thereon, Junior Lienholders acknowledge and agree that Bank neither undertakes nor
assumes any fiduciary responsibility or other responsibility or duty to Borrower or Junior
Lienholders to guarantee or assist in Borrower's or Junior Lienholders' performance under any of
the agreements between those parties and other third parties, including without limitation the
Junior Obligation Documents.
7
4847-5035-7925.5
10. Miscellaneous. This Agreement may be executed in multiple counterparts and the
signature page(s) and acknowledgment(s) assembled into one original document for recordation,
and the validity hereof shall not be impaired by reason of such execution in multiple counterparts.
This Agreement is to be governed according to the laws of the State of Colorado. In the event of
action, suit, proceeding or arbitration to enforce any term of this Agreement, the prevailing party
shall be entitled to recover from the non-prevailing party, as determined by the court or arbitrator,
all of the prevailing party's costs and expenses, including without limitation attorneys' fees and
expert witness fees, incurred by the prevailing party in connection therewith. If a Junior
Lienholder or any affiliate of a Junior Lienholder shall acquire, by subrogation or otherwise, any
lien, estate, right or other interest in the Property, that lien, estate, right or other interest shall be
subordinate to the Senior Mortgage and the other Senior Loan Documents as provided herein, and
each Junior Lienholder hereby waives, on behalf of itself and such affiliate, until all amounts owed
under the Senior Loan Documents have been indefeasibly paid in full and all Bank's obligations
to extend credit under the Senior Loan Documents have terminated, the right to exercise any and
all such rights it may acquire by subrogation or otherwise. The Agreement shall inure to the benefit
of, and the binding upon, the parties hereto and the respective successors and assigns.
11. RAD Use Agreement. For so long as the RAD Use Agreement made on or about
the date hereof,by and between the United States Department of Housing and Urban Development,
acting by and through its Secretary (hereinafter called "HUD") and the Borrower is in effect, the
Junior Obligation Documents and Senior Loan Documents shall be subordinate to the RAD Use
Agreement. In the event of any conflicts between (i) the Junior Obligation Documents and the
Senior Loan Documents and (ii) the RAD Use Agreement, the terms of the RAD Use Agreement
shall control. Further,the Junior Obligation Documents and Senior Loan Documents shall remain
automatically subordinate to the RAD Use Agreement in the event any subsequent modification
or amendments are deemed necessary to the RAD Use Agreement; provided, that the Senior
Lender has been given notice of such modification or amendment prior to the execution thereof.
These HUD-required provisions in this Section 11 shall not be amended without the prior written
consent of HUD. Further, any change to the Junior Obligation Documents and the Senior Loan
Documents that results in an increase in the interest rate, an increase of the total indebtedness, an
acceleration of the amortization or payment schedule,or any changes that would preclude or impair
a reasonable opportunity to cure any defaults by the Borrower under the Junior Obligations
Documents and Senior Loan Documents shall not be effective without the prior written consent of
HUD. The subordination to the RAD Use Agreement set forth in this Agreement survives
bankruptcy or foreclosure, is binding on successors and assigns, and may only be changed with
HUD consent.
[remainder of page left intentionally blank]
8
4847-5035-7925.5
IN WITNESS WHEREOF, THIS SUBORDINATION AGREEMENT has been executed
by Borrower as of the day and year first above written.
BORROWER:
MOUNTAIN VIEW TOWNHOMES, LLLP, a
Colorado limited liability limited partnership
By: Mountain View MM, LLC, a Colorado
limited liability company
Its: General Partner
By: El Centro Pueblo Development
Corporation, Inc., a Colorado non-profit
corporation
Its: Sole Member
By: 12�..
Name: Frank D. Pacheco
Title: Secretary/Treasurer
ACKNOWLEDGMENT
STATE OF COLORADO )
) ss.
COUNTY OF [ ] ) /v
The foregoing instrument was acknowledged before me this `)3' day of
2020, by Frank D. Pacheco, as Secretary and Treasurer of El Centro Pueblo Development
Corporation, Inc., a Colorado non-profit corporation, the Sole Member of Mountain View MM,
LLC, a Colorado limited liability company, the General Partner of Mountain View Townhomes,
LLLP, a Colorado limited liability limited partnership, on behalf of said limited liability limited
partnership.
Witness my hand and official seal.
My commission expires: O (-12 I?t)2 L/ .
CHERYL L. WILKERSON 2C- LLJ z
NOTARY PUBLIC Nota ublic
STATE OF COLORADO
NOTARY ID# 19964004153
MY COMMISSION EXPIRES 03/08/2024
4847-5035-7925.4
JUNIOR LIENHOLDERS:
HOUSING AUTHORITY:
HOUSING AUTHORITY OF THE CITY OF
PUEBLO, COLORADO, a body corporate and
politic of the State of Colorado
By:
e O
Name: Frank D. Pacheco
Its: Interim Executive Director
ACKNOWLEDGMENT
STATE OF COLORADO )
) ss.
COUNTY OF [_] ) -}? \i-)1(
('
The foregoing instrument was acknowledged before me this2' day of 0 ,
2020,by Frank D. Pacheco, as Interim Executive Director of the Housing Authority of the City of
Pueblo, Colorado, a body corporate and politic of the State of Colorado, on behalf of said body.
Witness my hand and official seal.
My commission expires: ( � ����' /c `-/
NU/IL-At , , Zi. c Zit
CHERYL L.WILKERSON Notar Public
NOTARY PUBLIC
STATE OF COLORADO
NOTARY ID# 19964004153
MY COMMISSION EXPIRES 03/08/2024
4847-5035-7925.4
CITY:
CITY OF PUEBLO, COLORADO, a Municipal
Corporation
By: 3/4.4e•Peell ,Cewee-0020*
Nicholas A. Gradisar, Mayor
ACKNOWLEDGMENT
STATE OF COLORADO )
) ss.
COUNTY OF [ pt, bL C )
The foregoing instrument was acknowledged before me this ]day of 4,1,j) ,
2020, by Nicholas A. Gradisar, as Mayor of the City of Pueblo, Colorado, aMunicipal
Corporation, on behalf of said Corporation.
Witness my hand and official seal.
My commission expires: )0 I I
Eilene Tracey Sampled r'-
NOTARY PUBLICJ
STATE OF COLORADO Notary Public
NOTARY IDS 20074038010
MY COMMISSION EXPIRES 1010'2023
4847-5035-7925.4
BANK:
U.S. BANK NATIONAL ASSOCIATION,
a national banking asso ' ' n
By:
Name: awni Freeman
Title: Assistant Vice President
STATE OF Ai 1 )
SS.
COUNTY OF 1),0/U���(a )
Uy
The undersigned, a Notary Public in and for the said County, in the State aforesaid, DO
HEREBY CERTIFY that Dawni Freeman, the Assistant Vice President of U.S. BANK
NATIONAL ASSOCIATION, a national banking association, who is personally known to me to
be the same person whose name is subscribed to the foregoing instrument, appeared before me
this day in person and acknowledged that he/she signed and delivered said instrument as his/her
own free and voluntary act and as the free and voluntary act of said bank, for the uses and
purposes therein set forth.
GIVEN under my hand and notarial seal this i'g • ; of t,4p/L ( , 2020.
4 I
Notary Public ; GENERAL NOTARY-State of Nebraska
RESU RAYAMAJHI
r My Comm.Exp.October 24,2023
My Commission Expires:
Oct za2
4847-5035-7925.4
EXHIBIT "A"
Legal Description
LOT 1, TRACTS A AND B, UPLANDS TOWNHOMES FILING NO. 2, RECORDED
DECEMBER 6, 2019 UNDER RECEPTION NO. 2161535, COUNTY OF PUEBLO, STATE
OF COLORADO.
4847-5035-7925.5
EXHIBIT "B"
Junior Obligation Documents
Housing Authority Documents
HACP Proceeds
1. Deed of Trust dated as of even date herewith, executed by Borrower in favor of the Housing
Authority.
2. Promissory Note dated as of even date herewith, executed by Borrower in favor of the
Housing Authority in the face principal amount of$1,842,329.
3. Loan Agreement dated as of even date herewith, executed by Borrower and the Housing
Authority.
HACP Capital Funds
1. Deed of Trust dated as of even date herewith, executed by Borrower in favor of the Housing
Authority.
2. Promissory Note dated as of even date herewith, executed by Borrower in favor of the
Housing Authority in the face principal amount of$1,400,000.
3. Loan Agreement dated as of even date herewith, executed by Borrower and the Housing
Authority.
HACP DOLA Loan
1. Deed of Trust dated as of even date herewith, executed by Borrower in favor of the Housing
Authority.
2. Promissory Note dated as of even date herewith, executed by Borrower in favor of the
Housing Authority in the face principal amount of$1,275,000.
3. Grant Agreement dated as of even date herewith, executed by Borrower and the Housing
Authority.
4. Use Covenant and Regulatory Agremeent dated as of even date herewith, executed by
Borrower and the Housing Authority.
B-1
4847-5035-7925.5
City Documents
1. Deed of Trust dated as of even date herewith, executed by Borrower in favor of the City.
2. Promissory Note dated as of even date herewith, executed by Borrower in favor of the City,
in the face principal amount of$500,000.
3. City of Pueblo Affordable Housing Development Agreement (Rental Development) (the
"City Regulatory Agreement") dated as of even date herewith, executed by Borrower and the
City.
2
4847-5035-7925.5
PROMISSORY NOTE
Principal Amount: U.S. $500,000.00 Date of Note: April 30, 2020
FOR VALUE RECEIVED, the undersigned Mountain View Townhomes, LLLP, a
Colorado limited liability limited partnership, hereinafter referred to as "Borrower", and its
successors in interest, promises to pay to the City of Pueblo, a Municipal Corporation, or order,
hereinafter referred to as the "Note Holder," the sum of Five Hundred Thousand and No/100ths
($500,000.00) U.S. Dollars and interest on the principal balance outstanding from the date hereof
until paid, at the rate of zero percent (0%) per annum, provided payment is made in accordance
herewith, and payable at the Note Holder's office at 1 City Hall Place, Pueblo, Colorado, 81003,
or such other place as Note Holder may designate, in ten (10) equal consecutive annual payments
of approximately Fifty Thousand and No/100ths ($50,000.00) U.S. Dollars due on the first day of
June 2021 and each year thereafter for ten(10)years; provided however, such payments are subject
to a limitation equal to one hundred percent (100%)of the net cash flow from the Project, with any
payments or portion of payments that cannot be paid due to such limitation to be made at the time
of the next available net cash flow. As used herein, "net cash flow from the Project" means, with
respect to any fiscal year or applicable period, (a)all cash receipts of Mountain View Townhomes,
LLLP, its successors and assigns (collectively the "Partnership") from operations (excluding
proceeds from Capital Transactions, Capital Contributions and the proceeds of any loan), subsidy
payments or rental interruption insurance recoveries received by the Partnership during such
period, plus(b)any interest or like earnings of the Partnership and any amounts which the General
Partners release upon approval of the Investor Limited Partner as being no longer necessary to
hold as part of such reserve, less: (i) cash funds used to pay Project Expenses of the Partnership
during the period, including any fees and expenses paid to the Partners, (ii) all cash payments
during such period to discharge Partnership indebtedness, and (iii) any amounts added to
Partnership reserves (other than the Operating Reserves) during such period. If not sooner paid or
accelerated as herein provided, the entire principal amount of Five Hundred Thousand and
No/100ths ($500,000.00) U.S. Dollars outstanding, less payments, and accrued interest thereon,
shall be due upon the end of the twenty(20)year period of affordability pursuant to the Agreement
(as defined below).
The Loan evidenced by this Note is being made to finance a residential housing project
(hereinafter referred to as the "Project") in accordance with the Affordable Housing Development
Loan Agreement between Borrower and Note Holder dated April 30, 2020 (hereinafter referred to
as the "Agreement"). This Note and all principal and interest payable hereunder are secured by a
Deed of Trust of even date herewith upon real property, upon which the Project is located or to be
located, and all improvements thereon, situated in the County of Pueblo, State of Colorado
(hereinafter referred to as the "Property") and described more particularly as:
Legal Description
Lot 1, Tracts A and B, Uplands Townhomes Filing No. 2, Recorded December 6,2019 under
reception No. 2161535,County of Pueblo, State of Colorado
Also known as street and number:
1402, 1406, 1410, 1414, 1401, 1405, 1409, 1413, 1431, 1435, 1439, 1443, 1432, 1436, 1440, 1444 Lipan Place;
1402, 1406, 1410, 1414, 1401, 1405, 1409, 1413, 1431, 1435, 1439, 1443, 1432, 1436, 1440, 1444 Wichita Place;
1402,1406, 1410, 1414, 1431, 1433, 1435, 1439, 1443, 1445, 1432, 1434, 1436, 1440, 1444, 1446 Mandan Place;
and,2501,2505,2509 Lakota Place.
The terms, conditions, covenants, provisions, stipulations and agreements of said Deed of Trust
and said Agreement are hereby made a part of this Note by reference in the same manner and with
the same effect as if they were fully set forth herein, and the Borrower hereby covenants and
promises to abide by and comply with each and every covenant and condition set forth in this Note,
the Deed of Trust and the Agreement.
The Borrower reserves the right to prepay all or any part of the principal owing on this
Note at any time or times prior to maturity without notice and payment of any premium or penalty.
Upon the occurrence of any of the following events, the entire principal amount of Five
Hundred Thousand and No/100ths ($500,000.00) U.S. Dollars, or the unpaid principal thereof,
together with all accrued interest thereon, shall, at the option of the Note Holder, upon 20 days
written notice to Borrower by certified mail or commercial express courier, unless cured within
said 20 days, where Note Holder may require specific performance, become at once due and
payable and shall accrue interest at the default rate of four percent(4%)per annum thereafter until
paid in full,and no failure by the Note Holder to exercise such option shall be deemed or construed
as a waiver of the right or as a waiver of the right to exercise the same in the event of any
subsequent default or breach:
1. Any default in the payment when due, or any part of the principal or interest
hereunder.
2. Any breach or failure of the Borrower to perform within the allotted time any term
or condition of the Agreement, the Deed of Trust, or any other instrument securing
to the Note Holder payment or performance of any obligation of the Borrower.
3. If the Borrower shall be involved in financial difficulties as evidenced: (i) by an
admission in writing of the Borrower's inability to pay its debts generally as they
become due; (ii) by filing a petition in bankruptcy or for the adoption of an
arrangement under the federal Bankruptcy Code (as now or in the future amended)
or an admission seeking the relief therein provided; (iii) by making an assignment
for the benefit of creditors; (iv) by consenting to the appointment of a receiver or
trustee for all or a substantial part of the Borrower's assets or to the filing of a
petition against the Borrower under said Bankruptcy Code; (v)by being adjudicated
as bankrupt; (vi) by the entry of a court order appointing a receiver or trustee for all
or a substantial part of the assets of the Borrower or approving as filed in good faith
a petition filed against the Borrower under said Bankruptcy Code; (vii) by the
assumption of custody or sequestration by a court of competent jurisdiction of all
or substantially all of the assets of the Borrower; (viii) by an attachment for an
amount in excess of$25,000 on any substantial part of the assets of the Borrower
which shall not be discharged within thirty (30) days from the making thereof; or
(ix) by a judgment or decree for the payment of money in excess of$25,000 being
entered against the Borrower, or if an attachment, execution or levy is made upon
any of the Borrower's assets and the judgment, execution or levy, as the case may
be, is not discharged or stayed within thirty(30)days from the date of the judgment,
attachment, execution or levy as the case may be.
4. If the Borrower shall have made any misrepresentation of a material nature in its
application for the Loan, or in any document furnished by it to the Note Holder
relative to the Project.
5. If there is pending or threatened litigation with respect to the Loan or the
performance by the Borrower of any of its duties or obligations hereunder.
6. If the Project cannot proceed because of inability to continue land option or secure
zoning or due to any action by any branch of government which impairs use of the
Property herein described for proposed Project purposes.
7. If the Note Holder determines that the Borrower has abandoned or discontinued the
initiation, construction, rehabilitation or completion of the Project.
8. Any breach of the affordability requirements detailed in the Agreement, Deed of
Trust, or as otherwise may be required pursuant to 24 C.F.R. Part 92. In the event
the Borrower should sell or voluntarily transfer title to the Project, the Property, or
other real property or improvements constructed or improved with funds provided
pursuant to the Agreement, within 20 years after substantial completion of the
Project or said improvements, the entire indebtedness under this Note shall
immediately become due and payable and shall be collected and repaid to Note
Holder.
RIGHT TO CURE: Note Holder shall use best efforts to provide a courtesy copy of all
notices sent to Borrower hereunder to USA Mountain View Townhomes LLC c/o The Richman
Group Capital Corporation at 777 West Putnam Avenue,Greenwich,CT 06830, Attention: Joanne
D. Flanagan, Esq.Any failure to deliver such courtesy copy shall not be deemed a failure to provide
notice to the Borrower. Notwithstanding anything to the contrary contained in this Note,
Borrower's Investor Partner and/or Special Limited Partner shall have the right, but not the
obligation, to cure defaults of Borrower.
The Borrower, and any and all endorsers, sureties, guarantors and assumers hereof, hereby
jointly and severally waive presentment, protest, notices of dishonor and of protest, and all
defenses whatsoever on the ground of any extension(s) of the time of payment or of the due dates
of this Note, in whole or in part, before or after maturity, with or without notice, it being further
agreed by the Borrower and all such parties that they will pay all collection expense, court costs,
and reasonable attorneys' fees which may be incurred in the collection or enforcement of this Note
or any part hereof.
This instrument shall be governed by the laws of the State of Colorado and any dispute
-3-
regarding its terms and conditions shall be resolved in the District Courts of the State of Colorado.
Executed and delivered this day of P
3 b '?r , I , 2020.
BORROWER:
MOUNTAIN VIEW TOWNHOMES,
LLLP, a Colorado limited liability limited
partnership
By: Mountain View MM, LLC,
a Colorado limited liability company, its
general partner
By: El Centro Pueblo Development
Corporation, Inc., a Colorado non-
profit corporation, its sole member
B � i 411t-c- -�-o
Frank D. Pacheco, Secretary/Treasurer
-4-