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<br />Promissory Note <br /> <br />Date June 22 ,1999 Date of Project Completion JUklE. Zq, IqqCJ_ <br /> <br />1. FOR VALUE RECEIVED, the City of Fort Morgan, Colorado, Water Works and Distribution Enterprise <br />("BORROWER") promises to pay the State of Colorado Water Conservation Board ("STATE"), the principal sum of <br />Eight Million Dollars ($8,000,000) plus interest at the rate of four percent (4%) per annum for a term of thirty <br />(30) years, pursuant to Loan Contract No. C150004 ("LOAN CONTRAC'f'). <br /> <br />2. The first payment of $462,640,79 shall be due one year from the date that the STATE determines that the project <br />is complete, and annually thereafter until the entire principal sum, all accrued interest, and all late charges, n <br />any, shall have been paid in full. <br /> <br />3. Payments shall be made payable to the Colorado Water Conservation Board and mailed to 1313 Sherman <br />Street, Room 721, Denver, Colorado 80203. <br /> <br />4, If the STATE does not receive the annual payment within 15 calendar days of the due date, the State may <br />impose a late charge in the amount of 5% of the annual payment. <br /> <br />5. This Note may be prepaid in whole or in part at any time without premium or penalty. Any partial prepayment <br />shall not postpone the due date of any subsequent payments or change the amount of such payments. <br /> <br />6. All payments received shall be applied first to late charges, if any, next to accrued interest and then to reduce <br />the principal amount. <br /> <br />7. This Note is issued pursuant to the LOAN CONTRACT between the STATE and the BoRROWER. The LOAN <br />CONTRACT creates security interests in favor of the STATE to secure the prompt payment of all amounts that <br />may become due hereunder. The security interests, evidenced by a Security Agreement, cover certain <br />revenues and contract rights of the BORROWER. The LOAN CONTRACT and Security Agreement grant additional <br />rights to the STATE, including the right to accelerate the maturity of this Note in certain events. <br /> <br />a, If any annual payment is not paid when due or any default under the LOAN CONTRACT or Security Agreements <br />securing this Note occurs, the STATE may declare the entire outstanding principal balance of the Note, all <br />accrued interest, and any outstanding late charges immediately due and payable, and all such amounts shall <br />bear interest at the rate of 15% per annum from the date of defaull. The STATE shall give the BORROWER <br />written notice of any alleged default and an opportunity to cure within thirty (30) days of receipt of such notice <br />before the BORROWER shall be considered in default for purposes of this Promissory Note. <br /> <br />g, The BORROWER, any guarantor, and any other person who is now or may hereafter become primarily or <br />secondarily liable for the payment of this Note or any portion thereof hereby agree that if this Note or interest <br />thereon is not paid when due or suit is brought, then it shall pay all reasonable costs of collection, including <br />reasonable attomey fees. In the event of any bankruptcy or similar proceedings, costs of collection shall include <br />all costs and attorney fees incurred in connection with such proceedings, including the fees of counsel for <br />attendance at meetings of creditors' committees or other committees. <br /> <br />10. This Note shall be govemed in all respects by the laws of the State of Colorado. <br /> <br /> <br /> <br />an, Colorado, Water Works and <br />rprise <br /> <br />By <br /> <br />Appendix B to Loan Contract C150004 <br />