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HomeMy WebLinkAboutCFD COMMUNITY FACILITIES DISTRICT STUDY FUNDING AND REIMBURSEMENT AGREEMENT THIS COMMUNITY FACILITIES DISTRICT STUDY FUNDING AND REIMBURSEMENT AGREEMENT (this “Agreement”), dated as of April 1, 2003 is entered into by and between the TRUCKEE DONNER PUBLIC UTILITY DISTRICT, a public agency duly organized and validly existing under the laws of the State of California (the “PUD”), and TRUCKEE LAND, a Delaware limited liability company (the “Developer”). RECITALS: A. The Developer has requested that the PUD form one or more community facilities districts (the “District(s)”) to issue bonds for the purpose of financing various public facilities in connection with the development of either or both of the Developer’s projects located within the PUD. B. The PUD has not previously formed a community facilities district and wishes to study further the consequences of forming the District(s) and issuing bonds before determining whether to commence proceedings for the formation thereof C. The PUD and the Developer expect that the PUD would incur expenses in undertaking to study the appropriateness of forming the District(s) and issuing bonds, and the Developer is willing to provide funds with which the PUD may pay such expenses. D. Pursuant to California Government Code Section 53314.9, the Board of Directors of the PUD is authorized to accept advances of funds from any source, including, but not limited to, private persons or private entities, and may provide, by resolution, for the use of those funds for any authorized purpose, including, but not limited to, paying any costs incurred by the PUD in connection with the formation of a community facilities district. The Board of Directors of the PUD is also authorized to enter into an agreement, by resolution, with the person or entity advancing the funds to repay all or a portion of the funds advanced provided that certain conditions are met. The conditions to be satisfied with respect to funds advanced require that (1) the proposal to repay the funds must be included in the resolution of intention for the proposed community facilities district and in the resolution of formation for the proposed community facilities district and (2) that any proposed special tax is approved by the qualified electors of the community facilities district pursuant to the Act and that, if a proposed special tax is not approved, any funds advanced which have not been committed for any authorized purpose by the time of the election must be returned to the person or entity advancing funds. E. The PUD and the Developer are desirous of entering into this Agreement in accordance with Government Code Section 53314.9 in order to provide a mechanism by which the Developer may advance certain costs related to PUD’s study of the possible formation of the District(s) and the possible issuance of bonds by the District(s) and the District, when and if bonds are issued and proceeds are available, can reimburse the Developer for the amounts advanced. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties hereto agree as follows: 1. Recitals. Each of the above recitals is incorporated herein and is true and correct. 2. Proposed Formation of the District and Issuance of Bonds. (a) The PUD will undertake to analyze the appropriateness of forming the District(s) and the issuance of bonds by the District(s) and will retain, at the Developer’s expense, the consultants that the PUD determines necessary or convenient to assist it in studying the proposed formation of the District(s) and issuance of bonds. In addition, the cost of PUD staff time spent in connection with the formation of the District(s) and bond issuance (as reasonably determined by the PUD \[based on (i) its estimate of the total hourly cost to the PUD for each of its employees who spends time in connection therewith times (ii) its estimate of the number of hours so spent by each such employee) shall be at Developer’s expense. (b) In order to begin the process of analyzing the formation of the District(s) and the issuance of bonds, concurrently with its execution and delivery hereof, the Developer will deliver to the PUD the sum of $20,000. From time to time, the Developer shall make additional advances to the PUD within 15 business days following receipt from the PUD of a request for an additional advance to cover the costs described herein. In the event the Developer does not deliver the requested amount to the PUD within such 15-business day period, the PUD will have no obligation to proceed with any activity relating to the formation of the District(s) and/or the issuance of bonds. The Developer shall have the right to notify the PUD at any time, in writing, of its intention to abandon the formation of the District(s) or the issuance of bonds. Upon receipt of such notice, the PUD shall instruct its consultants to cease work as soon as practicable. The Developer shall be responsible for all costs and expenses incurred by the PUD or any PUD consultant or advisor relating to the proposed formation of the District(s) and/or bond issuance until work with respect to the proposed formation or bond issuance ceases following the receipt of the Developer’s notice of abandonment. (c) The PUD will provide written notice to the Developer when the remaining balance of the Developer’s advances is reduced to $5,000. The PUD will provide to the Developer from time to time a summary of how the advances have been spent, the unexpended balance remaining and the estimated costs to complete the studies contemplated hereby. The amounts advanced by the Developer will be reimbursable to the Developer, without interest, from the proceeds of any bonds issued by the District(s) when and if formed. In the event that bonds are not issued to provide a source of reimbursement to the Developer, the PUD shall have no liability to the Developer to reimburse it for any of amounts previously advanced by the Developer and expended by the PUD. 3. Reimbursement Procedure. In accordance with Government Code Section 53314.9, the parties agree that, if the qualified electors of the proposed District(s) do not approve the proposed special tax to be levied within the District(s), the PUD shall return any funds which have been advanced by the Developer pursuant to this Agreement and which have not been committed for any authorized purpose by the time of the election. Such returned funds shall be without interest. 4. Abandonment of Proposed District(s). The Developer understands that a decision to commence formation of the District(s) shall be in the sole discretion of the PUD. No provision of this Agreement shall be construed as a promise, warranty or agreement by the PUD to form the District(s) or to issue bonds. The PUD shall have no liability to Developer for a decision not to form the District(s) or issue bonds. 5. Indemnification and Hold Harmless. The Developer hereby assumes the defense of, and indemnifies and saves harmless, the PUD and each of its officers, directors, employees and agents, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put, by reason of or arising out of any acts or omissions of the Developer or any of the Developer’s officers, employees, contractors and agents in connection with studying and analyzing the proposed formation of the District(s); provided, however, this indemnification and hold harmless shall not include any action, damages, claims, losses or expenses arising out of the sole negligence or willful misconduct of the PUD, its officers, directors, employees or agents. 6. Notices. Any notice to be provided pursuant to this Agreement shall be delivered to the following addresses: Developer: Truckee Land, LLC c/o East West Partners P.O. Box 2537 Truckee, California 96160 Attention: Rick McConn PUD: Truckee Donner Public Utility District 11570 Dormer Pass Road P. 0. Box 309 Truckee, California 96160 Attention: General Manager Each party may change its address for delivery of notice by delivering written notice of such change of address to the other party. 7. Assignment. The Developer may not assign its interest in this Agreement without the prior written consent of the PUD, which consent shall not be unreasonably withheld. 8. Severability. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent permitted by law. 9. Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the matters provided for herein 10. Amendments. This Agreement may be amended or modified only by written instrument signed by all parties. 11. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. 12. Governing Law. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. 13. No Third Party Beneficiaries. No person or entity shall be deemed to be a third party beneficiary hereof; and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than the PUD (and its officers, directors, employees and agents providing services under this Agreement) and the Developer, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 14. Singular and Plural: Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. 15. Termination. This Agreement shall terminate and be of no further force and effect on the first anniversary of the date of this Agreement unless expressly amended by the parties; provided, however, that the Developer’s obligations under Section 5 shall survive the termination and the PUD s obligation to provide reimbursement in accordance with Section 3 for expenses incurred prior to the termination date shall also survive termination. TN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written. TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: ________________________________ Peter Holzmeister, General Manager TRUCKEE LAND. LLC By: EAST WEST RESORT DEVELOPMENT V, L.P., L.L.P., its Manager By: HF HOLDING CORP., its General Partner By: _________________________________ Blake L. Rim, Vice President