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<br />to the STATE, manage, operate, and maintain the PROJECT continuously in an efficient and <br />economical manner. The BORROWER agrees to indemnify and hold the STATE harmless from any <br />liability incurred by the STATE as a result of the STATE'S interest in the PROJECT facilities. <br /> <br />6.. BORROWER'S liability insurance, Upon execution of this contract and continuing until complete <br />repayment of the loan is made to the STATE, the BORROWER shall maintain commercial general <br />liability insurance with a company that is satisfactory to the STATE covering the management, <br />operation, and maintenance of the PROJECT with minimum limits of $1,000,000 combined single limit <br />for each occurrence and $2,000,000 general aggregate, including products/completed operations <br />and personal injury. <br /> <br />Said general liability insurance shall name the STATE as additional insured. A copy of a certificate of <br />said insurance and an additional insured endorsement must be filed with the STATE. Evidence of <br />current insurance coverage is to be provided as renewals occur. No loan funds shall be advanced <br />by the STATE without evidence of said current coverage. Throughout the life of this contract, the <br />STATE reserves the right to increase the above amount of insurance so that said amounts at a <br />minimum correspond to the amounts established by the Colorado Governmental Immunity Act, now <br />and as hereafter amended. <br /> <br />7. BORROWER'S authority to contract. Pursuant to its election held April 2, 1996, and to its statutory <br />authority, the BORROWER'S Board of Trustees has duly passed an ordinance, which shall be <br />irrepealable for the term of this loan contract, authorizing the BORROWER: <br /> <br />a. To enter into and comply with the terms of this contract and promissory note, and to pay the <br />indebtedness; <br /> <br />b. To pledge revenues from the BORROWER'S general funds in an amount sufficient to payoff the <br />loan made under this contract for repayment of this loan; <br /> <br />c. To set aside a sufficient amount of BORROWER revenues each year to pay the annual <br />installment in a special account, separate and apart from other revenues of the BORROWER; <br /> <br />d. To establish a reserve debt service fund by making an annual deposit equivalent to one-tenth of <br />an annual payment every year for 10 years, and to replenish that fund anytime it is depleted; <br /> <br />e. To execute a security agreement to convey a security interest to the STATE in the pledged <br />revenues: and <br /> <br />f. To execute a deed of trust to convey a security interest to the STATE in the property described in <br />the Collateral Provisions herein. <br /> <br />The BORROWER'S ordinance is attached hereto as Appendix 1 and incorporated herein. The <br />actions of the BORROWER adopting said ordinance and executing the necessary documents to <br />convey the security interests required by this contract are conditions precedent to performance by <br />the STATE under this contract. <br /> <br />8. Attorney's opinion letter. Prior to the execution of this contract by the STATE, the BORROWER shall <br />submit to the STATE a letter from its attorney stating that it is the attorney's opinion that the contract <br />will be duly executed by officers of the BORROWER who are duly elected or appointed and are <br />authorized to execute the contract and to bind the BORROWER: that the ordinance of the BORROWER <br /> <br />Town of Morrison <br /> <br />Page 4 of 13 <br />