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HomeMy WebLinkAboutRES 2003-43 - Board DistrictTRUCKEE DONNER PUblic Utility RESOLUTION NO. 2003-43 RESOLUTION OF THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT APPROVING AN ACQUISITION AND DISCLOSURE AGREEMENT IN CONNECTION WITH TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-1 (OLD GREENWOOD) WHEREAS, the Board of Directors (the"Board of Directors")of the Truckee Donner Public Utility District (the "Public Utility District") has heretofore commenced proceedings for the formation of Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) (the "Community Facilities District")pursuant to the Mello-Roos Community Facilities Act of 1982, as amended(the "Act"), to finance the acquisition and construction of certain facilities; and WHEREAS, some of the facilities expected to be financed by the Community Facilities District have been, or are expected to be, constructed by or on behalf of Old Greenwood, LLC (the "Developer") and to be acquired from the Developer if and to the extent bond proceeds are available for such purpose; and WHEREAS, in order to provide the terms on which such facilities will be required it is appropriate that the Public Utility District enter into an agreement with respect thereto with the Developer; and WHEREAS, the proposed form of such an agreement between the Public Utility District and the Developer(the "Acquisition and Disclosure Agreement") has been prepared and presented to the Board of Directors; NOW, THEREFORE, THE BOARD OF DIRECTORS OF TRUCKEE DONNER PUBLIC UTILITY DISTRICT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. The above recitals are true and correct. Section 2. The form of the Acquisition and Disclosure Agreement presented to the Board of Directors is hereby approved; and the President of the Board of Directors and the District Clerk are hereby authorized and directed, for and in the name of, the Public Utility District, to execute and deliver a copy of the Acquisition and Disclosure Agreement to the Developer substantially in the form so approved with such changes therein, if any, as such officers may approve. 1 �. ADOPTED and APPROVED by the Board of Directors of the Truckee Donner Public Utility District on this 14th day of October, 2003 by the following vote: AYES: Directors Aguera, Hemig and Van Gundy NOES: Director Sutton ABSENT: None RECUSE: Director Maass ABSTAIN: None TRUCKEE DONNER P LIC UTILITY DISTRICT r By: J o emig, President of the Board o irectors ATTEST: / k' Peter L. Holzmeister,District Clerk 2 ACQUISITION AND DISCLOSURE AGREEMENT TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-1 (OLD GREENWOOD) Recitals A. The parties to this Agreement are the Truckee Donner Public Utility District, a political subdivision of the State of California (the "PUD"), on behalf of itself and Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood),which is expected to be formed by the PUD (the "CFD"), and Old Greenwood, LLC, a Delaware limited liability company (the "Developer"). B. The effective date of this Agreement shall be October 20, 2003. C. The PUD expects to form the CFD pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended (the "Act"); and the Board of Directors of the PUD will serve as the legislative body of the CFD if it is formed. The CFD is expected to be authorized to issue bonds (the "Bonds") secured by a special tax (the "Special Tax") to be levied on property within its boundaries (the "Subject Property") in order to finance the acquisition or construction of certain facilities. D. The CFD is expected to be authorized to utilize a portion of the proceeds derived from the sale of the Bonds, if and to the extent such proceeds are available for such purpose, to acquire on behalf of the PUD and the Town of Truckee (the "Town") certain public improvements to be constructed either by, or under contract to,the Developer(the"Facilities"). E. Subject to the completion of proceedings pursuant to the Act for the formation of the CFD and the authorization of the Special Tax, the Subject Property will be subject to a continuing lien to secure payment of the Special Tax by virtue of the recordation of a notice of special tax lien in the official records of the County Recorder of the County of Nevada, as provided by the Act. F. The Facilities, the portions thereof that may be separately acquired (each, a "Segment") and the respective estimated acquisition prices related thereto (each, an "Acquisition Price") are identified in Exhibit A, attached hereto and by this reference incorporated herein. The Facilities that may be acquired on behalf of the PUD (the "PUD Facilities") are identified as PUD Facilities in Exhibit A, and the Facilities that may be acquired on behalf of the Town (the "Town Facilities") are identified as Town Facilities in Exhibit A. The parties expressly acknowledge and agree that Exhibit A may be subject to revision after the effective date of this Agreement, and the Acquisition Prices may be adjusted to reflect bids received, changes in work, etc., upon the written approval of the General Manager of the PUD, the Assistant General Manager of the PUD or the designee of the General Manager(each, a"PUD Authorized Representative") and the Developer. G. The Developer desires to assure the PUD that the Special Tax obligation will be fully disclosed to future purchasers from the Developer of parcels of land comprising the Subject Property. 1 DOCSOC\988372v5\22925.0009 Agreement In consideration for the mutual undertakings of the parties stated herein, the parties agree as follows: 1. Recitals. The foregoing recitals are true and correct, and the parties expressly so acknowledge. Said recitals are incorporated herein by reference. 2. Acquisition of Facilities. Subject to the completion of proceedings pursuant to the Act for the formation of the CFD,the authorization of the Special Tax and the issuance of the Bonds, and subject also to the availability of Bond proceeds in amounts sufficient for the following purposes, and subject also to the agreement of the Town with respect to the Town Facilities, the Developer hereby agrees to sell to the PUD or the Town, as the case may be (the "Applicable Governmental Entity"); and the CFD hereby agrees to pay to the Developer the applicable Acquisition Price for each such Facility(subject to adjustments thereof as described in Recital F and elsewhere in this Agreement), subject to the terms and conditions hereof. Title (where applicable)to each Segment purchased pursuant hereto shall be conveyed by appropriate instrument by the Developer to the Applicable Governmental Entity as of the date the Applicable Governmental Entity accepts such Segment. The Developer expressly acknowledges that the conditional obligation of the CFD to pay the Acquisition Price for each of the Facilities is strictly limited to a portion of the proceeds of sale of the Bonds and any available investment earnings thereon and to no other source of funds. The parties acknowledge and agree that the total of the Acquisition Prices for all of the Facilities purchased will not exceed the sum of the net Bond proceeds (if any)remaining after paying all costs of issuing the Bonds and funding a reserve fund and any other funds and accounts required .. to be funded with Bond proceeds and the earnings (if any) derived from the investment thereof, but that the Acquisition Price of any Facility may (with the approval of the PUD Authorized Representative) be increased if and to the extent that the amount actually paid for one or more other Facilities is less than the estimated Acquisition Price of such Facility. 3. Payment of Acquisition Price. (a)PUD Facilities. In order to be paid for a completed Segment of a PUD Facility, the Developer shall deliver to the PUD Authorized Representative (a) a request for such payment in the form attached as Exhibit B (a "Payment Request"), together with all attachments and exhibits to be included therewith and, where applicable as the PUD may deem appropriate under the circumstances, (i) a copy of the recorded documents conveying to the PUD title, acceptable to the PUD ("Acceptable Title"), to the real property on, in or over which such Segment is located, (ii) a copy of the recorded Notice of Completion of such Segment filed in accordance with Section 3093 of the California Civil Code (if applicable), and (iii) an assignment of the warranties and guaranties for such Segment, as described in Section 6(d)(ii), in form reasonably acceptable to the PUD. Until the acceptance by the PUD of the entire Facility of which the Segment being acquired is a part,the amount to be paid with respect to such Segment shall not exceed 90%of the Acquisition Price. The remaining 10% of the Acquisition Price shall be payable to the Developer within 35 days after the PUD's acceptance of the final Segment of the subject Facility. Upon receipt of a completed Payment Request (and all documentation required by this Agreement to be submitted therewith) for a Segment of a PUD Facility, the PUD Authorized Representative shall conduct a review in order to confirm that such Segment was constructed in accordance with the PUD-approved plans (the "Plans")therefor and to verify and approve the Actual 2 DOCSOC\988372v5\22925.0009 Cost (as defined below) of such Segment specified in such Payment Request. The Developer agrees to cooperate with the PUD Authorized Representative in conducting each such review and to provide the PUD Authorized Representative with such additional information and documentation as is reasonably necessary for the PUD Authorized Representative to conclude each such review. The PUD Authorized Representative shall complete such review as soon as reasonably practicable after receiving all necessary information and documentation and shall take action with respect thereto within [60] days after his or her receipt of such information and documentation. If the PUD Authorized Representative determines that the amount specified as the Actual Cost in such Payment Request as initially submitted exceeds the Developer's Actual Cost of constructing such Segment,the Developer shall resubmit such Payment Request, with the amount specified therein modified so as to take into account such determination of the Actual Cost by the PUD Authorized Representative. Upon confirmation that such Segment has been constructed in accordance with the Plans therefor, and verification and approval of the Actual Cost of such Segment, the PUD Authorized Representative shall sign the Payment Request and promptly forward the same to the Board of Directors for acceptance of the Segment. Following Board of Directors approval, the PUD Authorized Representative shall, as soon as possible, forward the Payment Request to the entity which holds the Bond proceeds that are available for such purpose (the "Bond Trustee"). As used in this Agreement, the term "Actual Cost" means, with respect to a Segment, (in each case, to the extent not previously paid to the Developer) an amount equal to the sum of(a)the Developer's actual cost of constructing such Segment, including labor, material and equipment costs, (b)the Developer's actual cost of preparing the Plans for such Segment, (c)the Developer's actual, cost of environmental evaluations required specifically for such Segment, (d)the amount of the fees .. actually paid by the Developer to governmental agencies in order to obtain permits, licenses or other necessary governmental approvals for such Segment, (e) a construction management fee equal to four percent (4%) of the amount described in clause (a), (f) a fee equal to thirteen percent (13%) of the amount described in clause (a) to compensate for the costs of professional services directly related to the construction of such Segment, including engineering, inspection, construction staking, materials testing and similar professional services, and (g) the Developer's actual cost of any title insurance required hereby for such Segment, all as specified in a Payment Request that has been reviewed and approved by the PUD Authorized Representative. Notwithstanding the foregoing, "Actual Cost" shall not include either (i) internal administrative costs incurred by the Developer or (ii) costs incurred by the Developer in connection with the preparation of a tentative or final tract map. (b) Town Facilities. In order to be paid for a completed Segment of a Town Facility,the Developer shall deliver to the PUD Authorized Representative a Town Facility Payment Request approved by the Town Manager of the Town or his designee. The PUD Authorized Representative shall promptly forward the Town Facility Payment Request to the Bond Trustee Until the acceptance by the Town of the entire Facility of which the Segment being acquired is a part,the amount to be paid with respect to such Segment shall not exceed 90%of the Acquisition Price. The remaining 10% of the Acquisition Price shall be payable to the Developer within 35 days after the Town's acceptance of the final Segment of the subject Facility. 4. Developer's Duty to Construct. The Developer shall construct each Facility, or cause each Facility to be constructed, in accordance with the Plans for such Facility approved by the Applicable Governmental Entity. The Developer shall perform all of its obligations hereunder, and shall conduct all operations with respect to the construction of the Facilities, in a good, workmanlike 3 DOCSOC\988372v5\22925.0009 and commercially reasonable manner, with the standard of diligence and care normally employed by duly qualified persons utilizing their best efforts in the performance of comparable work and in accordance with generally accepted practices appropriate to the activities undertaken. The Developer shall not be relieved of its obligation to construct each Segment, and convey such Segment to the Applicable Governmental Entity in accordance with the terms hereof, even if the Acquisition Price for such Segment is less than the Actual Cost of such Segment, or is in excess of proceeds of the Bonds available to pay such Acquisition Price, if any. 5. Public Works Requirements. In order to insure that each Facility whose construction has not been completed, as determined by the Board of Directors of the PUD (based on the advice of the Town in the case of the Town Facilities), before the formation of the CFD will be constructed as if it had been constructed under the direction and supervision, or under the authority, of the Applicable Governmental Entity, so that it may be acquired pursuant to California Government Code Section 53313.5, the Developer shall comply with all of the legal requirements that would apply to the Applicable Governmental Entity if the Facility were being constructed by such Applicable Governmental Entity. In addition, the Developer shall provide for its own construction financing, construction contracting and contract administration. In providing for the construction and installation of the Facilities, the Developer and its contractor(s) shall be obligated to meet all requirements customarily imposed by the Applicable Governmental Entity and by any other public agency or public utility company having jurisdiction upon subdividers, developers and contractors in such circumstances. Without limiting the generality of the foregoing,the Developer shall be obligated as follows: i. The Developer and/or its contractor(s) shall post completion bonds, labor and materials bonds, and one-year maintenance bonds (such one-year period to commence upon acceptance by the Applicable Governmental Entity of the final Segment comprising a Facility) in the same manner and in the same amount as is required by the Applicable Governmental Entity and by any other public agency or public utility company having jurisdiction as would be required in the absence of the District financing program. ii. The Developer warrants, and by its offer to transfer ownership of the Facilities to the Applicable Governmental Entity, shall warrant that the Facilities will be free from defects in workmanship or materials and will be suitable for their intended use. Said warranty shall extend for a period of one (1)year after the issuance by the PUD of a notice of acceptance of the final Segment comprising a Facility. As an alternative to said sole warranty from the Developer, the Developer shall require each contractor, subcontractor, supplier, or materialman in connection with the construction and installation of the Facilities to name the Applicable Governmental Entity as a beneficiary of each warranty or guarantee given by such party to the Developer in connection with such party's work, supplies or materials. iii. In addition to the warranties and obligations of the Developer set forth in the foregoing subparagraph (ii), the Developer shall remain and be responsible to the Applicable Governmental Entity for any defects in work, supplies, or materials in connection with the Facilities occurring or appearing within one (1) year of issuance by the Applicable Governmental Entity of its notice of acceptance of said final Segment comprising a Facility. The Applicable Governmental Entity shall give the Developer written notice to replace, repair or correct any defect forthwith upon discovery thereof, and the Developer shall 4 DOCSOC\988372v5\22925.0009 proceed forthwith and with all due diligence to effectuate replacement, repair or correction of such defect. The requirements of subparagraph (i) above pertaining to maintenance bonds and the provisions of subparagraphs (ii) and (iii) above shall be applicable to all Facilities, not merely those whose construction had not been completed prior to the formation of the CFD. 6. Representations, Warranties and Covenants of the Developer. The Developer makes the following representations, warranties and covenants for the benefit of the PUD, the CFD and the Town: (a) Organization. The Developer represents and warrants that the Developer is a limited liability company, duly organized and validly existing under the laws of the State of Delaware, is in compliance with the laws of the State of California, and has the power and authority to own its properties and assets and to carry on its business as now being conducted and as now contemplated. (b) Authority. The Developer represents and warrants that it has the power and authority to enter into this Agreement, and it has taken all action necessary to cause this Agreement to be executed and delivered, and this Agreement has been duly and validly executed and delivered on behalf of the Developer. (c) Binding Obligation. The Developer represents and warrants that this Agreement is a valid and binding obligation of the Developer and is enforceable against the Developer in accordance with its terms. (d) Completion of Facilities. The Developer covenants that it will use its reasonable and diligent efforts to do all things which may be lawfully required of it in order to cause the Facilities to be completed in accordance with this Agreement. (e) Compliance with Laws. The Developer covenants that it will not commit, suffer or permit any act to be done in, upon or to the property on which the Facilities are to be constructed or the Facilities in violation of any law, ordinance, rule, regulation or order of any governmental authority or any covenant, condition or restriction now or hereafter affecting such property or the Facilities. (f) Requests for Payment. The Developer represents and warrants that (i) it will not request payment from the District for the acquisition of any improvements that are not part of the Facilities, (ii) each facility described in Section 5 for which payment is requested will have been constructed as if it had been constructed under the direction and supervision, or under the authority, of the Applicable Governmental Entity and (iii)the Developer will diligently follow all procedures set forth in this Agreement with respect to the Payment Requests. (g) Financial Records and Construction Documents. Until the final acceptance of the Facilities, the Developer covenants to maintain proper books of record and account for the Facilities and all costs related thereto. The Developer covenants that such accounting books will be maintained in accordance with generally accepted accounting principles, and will be available for inspection by the District and the Applicable Governmental Entity, and their respective agents, at any reasonable time during regular business hours on reasonable notice. In addition, the Developer agrees to maintain and to make available for inspection by the District and the Applicable 5 DOCSOC\9883 72v5\22925.0009 Governmental Entity, and their respective agents, at any reasonable time during regular business hours on reasonable notice all documents relating to the construction of the Facilities including, but not limited to, the Plans, specifications, easements, rights-of-way, licenses, permits, surveys, estimates, schedules, contracts for the construction of any portion of the Facilities, invoices and receipts for payments relating to the Facilities, insurance policies, payroll records, and any other documents required to be maintained by any applicable provision of law. (h) Hazardous Materials. The Developer represents and warrants that, to the best knowledge of the Project Manager for the Developer's Old Greenwood development, there is not present upon the Subject Property, or any portion thereof, or upon any portion of the Facilities currently existing, or any portion thereof, any Hazardous Materials (as defined below). The Developer represents and warrants that all operations or activities upon, or use or occupancy of the Subject Property and the Facilities, and each portion thereof, by the Developer, or to the best knowledge of the Project Manager for the.Developer's Old Greenwood development, by any prior tenant, occupant or owner of the Subject Property or any portion thereof, is in all material respects in compliance with all state, federal and local laws, ordinances, regulations, rules, decisions or policy statements governing or in any way relating to the generation, handling, manufacturing, treatment, storage, use, transportation, spillage, leakage, dumping, discharge or disposal (whether accidental or intentional) of any toxic or hazardous substances, materials, or wastes, including, but not limited to, Hazardous Materials. The Developer represents and warrants that there is no proceeding or inquiry by any governmental authority body or agency with respect to the presence of Hazardous Materials on the Subject Property or the Facilities or the migration thereof from or to other property. The Developer represents and warrants that neither the Developer, nor any subcontractor, agent or employee thereof will use, generate, manufacture,procure, store, release, discharge or dispose of any Hazardous Material on, under or about the Subject Property or the Facilities or transport any Hazardous Material to or from the Subject Property or the Facilities in violation of any federal, state or local law, ordinance, regulation, rule, decision or policy statement regulating Hazardous Material. "Hazardous Material" means any hazardous or toxic substance, material or waste which is or becomes regulated by any local governmental authority, the State or the United States Government and specifically includes, without limitation, any material or substance which is (a) designated as a "hazardous substance"pursuant to Section 311 of the Federal Water Pollution Control Act, 33 U.S.C. Sections 1251 et seq. (33 U.S.C. Section 1321), (b) defined as a "hazardous waste" pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901 et seq. (42 U.S.C. Section 6903), (c) defined as a "hazardous substance" pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sections 9601 et seq., (d)petroleum, or(e) asbestos. (i) Permits. The Developer represents and warrants that, all governmental or other permits required to proceed with the acquisition, construction and installation of the Facilities have been or will be obtained in a timely manner and all fees relating thereto have been or will be paid in a timely manner. The Developer represents and warrants that there is no material impediment to the Developer's proceeding with and completing the acquisition, construction and installation of the Facilities or to the development of the Subject Property as contemplated by the Developer. 7. Indemnification. The Developer agrees to protect, indemnify, defend and hold the CFD and the PUD, and their respective officers, employees and agents, and each of them, harmless from and against any and all claims, losses, expenses, suits, actions, decrees, judgments, awards, attorney's fees, and court costs which the CFD or the PUD, or their respective officers, employees and agents, or any combination thereof, may suffer or which may be sought against or recovered or 6 DOCSOC\9883 72v5\22925.0009 obtained from the CFD or the PUD, or their respective officers, employees or agents, or any combination, thereof as a result of or by reason of or arising out of or in consequence of(a)the acquisition, construction, installation or financing of the Facilities, (b)the untruth or inaccuracy or any representation or warranty made by the Developer in this Acquisition Agreement, (c) any act or omission, negligent or otherwise, of the Developer or any of its subcontractors, agents or,anyone who is directly employed by or acting in connection with the Developer or any of its subcontractors, or agents, in connection with the Facilities, or (d)this Agreement. If the Developer fails to do so, the CFD and the PUD shall each have the right,but not the obligation,to defend the same and charge all of the direct or incidental costs of such defense, including any attorneys fees or court costs, to and recover the same from the Developer. No indemnification is required to be paid by the Developer for any claim, loss or expense arising from the willful misconduct or sole negligence of the CFD or the PUD, or their respective officers, employees or agents. The provisions of this Section shall survive the termination of this Acquisition Agreement. 8. Disclosures to Purchasers of Subject Property. The Developer covenants and agrees that from and after the date hereof it will provide all forms of disclosure of the Special Tax as required by existing law and by any future laws. In particular, the Developer covenants and agrees from and after the date hereof to provide the Special Tax disclosure notice required by Section 53341.5 of the Act and to retain in its files copies of all notices signed by purchasers in accordance with Section 53341.5. The PUD shall have the right to inspect and obtain copies of all of the Developer's records regarding Special Tax disclosure. The Developer further agrees to include in its contracts with purchasers of any of the Subject Property (other than individuals purchasing custom lots or fractional interests in residences) entered into from and after the date hereof a requirement that such purchasers (i)provide all forms of disclosure of the Special Tax required by law, (ii)retain signed copies of the Section 53341.5 notice following the sale of any parcel comprising part of the Subject Property to another, and (iii)provide the PUD on request an opportunity to review and obtain copies of all records relating to disclosure of the Special Tax. Such contractual provision shall further provide that the PUD and the CFD are third party beneficiaries of such disclosure requirements and that the purchaser of any of the Subject Property will indemnify the PUD, the CFD and their respective officers and employees for any failure of such purchaser to disclose the Special Tax as required by law. 9. Developer Responsibilities. The Developer acknowledges that it is represented by its own separate legal counsel in regard to the proceedings for the formation of the CFD, the levy of the Special Tax, the authorization and issuance of the Bonds, the negotiation of this agreement, and the process of constructing and installing the Facilities. The Developer accepts responsibility for and shall be responsible for identification of and for compliance with all applicable laws pertaining to constructing and installing the Facilities and the contract or contracts pertaining thereto, including, in the case of each Facility described in Section 5, the laws that would apply to the Applicable Governmental Entity if it were constructing such Facility itself. Notwithstanding the requirements of this Agreement, the PUD makes no representation as to the applicability or inapplicability of any laws regarding contracts, including contracts related to the construction and installation of the Facilities, and especially the matters of competitive bidding and the payment of prevailing wages. The PUD may, in its sole discretion, supply guidance to the Developer with respect to laws governing the construction of an improvement by the PUD if requested to do by the Developer; and the PUD shall take no action against the Developer by reason of any act, or failure to act, of the 7 DOCSOC\988372v5\22925.0009 Developer that is in strict conformance with any written guidance provided to the Developer by the PUD Authorized Representative. Whether or not the PUD shall have provided any such guidance to the Developer, the Developer will neither seek to hold nor hold the PUD liable for any consequences of any failure by the Developer to correctly determine applicability of any such requirements to any contract it enters into, irrespective of whether the PUD knew or should have known about applicability of any such requirement. This paragraph shall apply with respect to any enforcement action, whether public or private, and whether brought by a public enforcement agency or by private civil litigation, against the Developer or the PUD or both with respect to the matters addressed by this paragraph. 10. Special Tax Levy. In order to assure the highest possible level of accuracy in the annual levy of the Special Tax, the PUD will use reasonable efforts to provide the Developer with a copy of the proposed annual levy by July 1 of each year so that the Developer may review and comment on it prior to its submittal to Nevada County, provided that the District's failure to do so will not be a breach of this Agreement and will not prevent the District from filing the proposed annual levy with Nevada County at such time as it deems necessary or appropriate. The provisions of this section will expire and be of no further force or effect on the earlier of(i) the date on which the Developers no longer owns property within the CFD that is responsible for more than 20% of the total Special Tax that may be levied on property within the CFD or(ii)July 1, 2014. 11. Notices. Any notices required to be given pursuant to this agreement shall be given in writing and shall be mailed to the parties at the following addresses: PUD: Truckee Donner Public Utility District 11570 Donner Pass Road P.O. Box 309 Truckee, California 96160 Attention: General Manager Developer: Old Greenwood, LLC c/o East West Partners - Tahoe P.O. Box 2537 Truckee, California 96160 Attention: Mark Wasley 12. Miscellaneous. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. Any action at law or in equity arising under this Agreement brought by any party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Nevada County Superior Court, and the parties hereby waive all provisions of law providing for the filing,removal or change of venue to any other court. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine and vice versa. The parties hereto hereby agree that an implied standard of reasonableness shall govern all actions of the parties hereunder, and the parties hereby covenant to one another to act in good faith and to deal fairly with one another to effectuate the purposes of this Agreement. 8 DOCSOC\988372v5\22925.0009 .. This is intended to be a fully integrated agreement which contains the entire agreement between the parties with respect to the matters pertaining to the process of acquisition by the PUD of the Facilities. Time is of the essence with respect to this Agreement and each and every provision hereof. Except as may be specifically provided herein to the contrary, no third party shall be the express or implied beneficiary of this Agreement or any of its provisions, and no such third party may bring any action in law or equity with respect thereto. 9 DOCSOC\988372v5\22925.0009 IN WITNESS WHEREOF, the parties hereto have caused this Acquisition and Disclosure Agreement to be executed by their authorized representatives as of the effective date stated above. TRUCKEE DONNER PUBLIC UTILITY DISTRICT il ft.-4.7 By: 00-0 OVA iden't of the Board of Directors Attest: PBy: vrp�-e'A District Clerk OLD GREENWOOD,LLC By: EAST WEST RESORT DEVELOPMENT V, L.P., L.L.P., its Manager By:HF HOLDING CORP., its General Partner By: - Blake L. Riva,Vice President 10 DOCSOC\988372v5\22925.0009 EXHIBIT A FACILITIES, SEGMENTS AND ACQUISITION PRICES PUD-Water Facilities 1 Water facilities connecting Glenshire Well to water storage located within District 282,000 2 Water storage facility within District including all connections and control devices(360,000 gallon water tank) 571,000 3 Water distribution facilities constructed and completed in 2001 connecting water storage facility to road entrance and existing structures 221,000 4 Water source distribution system serving all residential and commercial properties adjoining Fairway Drive,Lookout Loop,Settler's Lane, Caleb Drive,Caleb Circle,Lookout Circle and including 20"water mainline connecting water storage facility to Fiberboard under crossing. 2,220,000 5 Development Agreement water connection fee 86,000 6 Water source distribution system -TDPUD-on-site production well 750,000 7 Water source distribution system and water agreement costs serving all residential and commercial properties on Legacy Court 104,000 8 Water source distribution system and water agreement costs serving all residential and commercial properties on Miners Trail 148,000 9 Water source distribution system and water agreement costs serving all residential and commercial properties on Carson Range Court 151,000 10 Water source distribution system and water agreement costs serving all residential and commercial properties on Sutter's Trail 199,000 I 1 Water source distribution system and water agreement costs serving all residential and commercial properties on Gold Rush Trail 39,000 12 Water source distribution system and water agreement costs serving all residential and commercial properties on Trapper's Trail 112,000 13 Water source distribution system and water agreement costs serving all residential and commercial properties on Frontier Trail 108,000 Total PUD-Water Facilities 4,991,000 PUD-Electrical Facilities 14 Offsite electrical facilities connecting Glenshire Drive to Interstate 80 as constructed and completed in 2001 1,138,000 15 Electrical infrastructure required to service residential and commercial parcels adjoining Fairway Drive,Lookout Loop,Settler's Lane,Caleb Drive,Caleb Circle,Lookout Circle and including but not limited to design,conduit,trenching,transformers and installation of cabling. 960,000 16 Development Agreement electrical connection fee 310,000 17 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Legacy Court 64,000 18 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Miners Trail 91,000 19 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Carson Range Court 93,000 20 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Sutter's Trail 122,000 21 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Gold Rush Trail 24,000 22 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Trapper's Trail 69,000 23 Electrical infrastructure and electrical agreement costs required to service residential and commercial properties on Frontier Trail 66,000 Total PUD-Electrical Facilities 2,937,000 PUD-Fiber Facilities 24 Fiber infrastructure connecting residential and commercial parcels adjoining Fairway Drive from 100 meters north of Lot D4,Lookout Loop,Lookout Circle,Caleb Drive, Caleb Circle and Settler's Lane. 362,000 .. 25 Fiber Optic Cable connecting residential and commercial parcels adjoining Fairway Drive from 100 meters north of Lot D4,Lookout Loop,Lookout Circle,Caleb Drive, Caleb Circle and Settler's Lane. 253,000 Total PUD-Fiber Facilities 615,000 A-1 DOCSOC\988372v5\22925.0009 EXHIBIT A (continued) FACILITIES, SEGMENTS AND ACQUISITION PRICES Town-Roadways 26 Roadways including Old Truckee Airport Road from the intersection of Interstate 80 exit to the eastern property boundary as constructed in 2001 469,000 27 Roadways including Fairway Drive from the intersection of Old Truckee Airport Road to 100 meters south of lot D4 308,000 28 Roadways including Fairway Drive from 100 meters south of lot D4 to third instersection with Lookout Loop and connecting roadways including Lookout Loop,Lookout Circle,Caleb Drive,Caleb Circle and Settler's Lane 2,147,000 29 Roadways for Legacy Court 79,000 30 Roadways for Miners Trail 113,000 31 Roadways for Carson Range Court 115,000 32 Roadways for Sutter's Trail 152,000 33 Roadways for Gold Rush Trail 29,000 34 Roadways for Trapper's Trail 85,000 35 Roadways for Frontier Trail 82,000 36 Road Cut Slope Landscape 76,000 37 Street Signs 49,000 38 Street Lighting 127,000 39 Fire Connection Road Gate 26,000 Total Town-Roadways 3,857,000 Town-Storm Water Systems 40 Storm water system including all v-ditches,culverts,and infiltration ponds associated with Fairway Drive from the intersection of Old Truckee Airport Road to 100 meters south of Lot D4 and including the water tank road 328,000 41 Storm water systems including all v-ditches,culverts and infiltration ponds associated with the remaining segments of Fairway Drive,and all other connecting roadways including Lookout Loop,Lookout Circle,Caleb Drive,Caleb Circle and Settler's Lane 817,000 42 Storm Water system including all v-ditches,culverts and infiltration ponds associated with the properties on Legacy Court 47,000 43 Storm W ater system including all v-ditches,culverts and infiltration ponds associated with the properties on Miners Trail 67,000 44 Storm Water system including all v-ditches,culverts and infiltration ponds associated with the properties on Carson Range Court 68,000 45 Storm Water system including all v-ditches,culverts and infiltration ponds associated with the properties on Sutter's Trail 90,000 46 Storm Water system including all v-ditches,culverts and infiltration ponds associated with the properties on Gold Rush Trail 18,000 47 Storm Water system including all v-ditches,culverts and infiltration ponds associated with the properties on Trapper's Trail 50,000 48 Storm Water system including all v-ditches,culverts and infiltration ponds associated with the properties on Frontier Trail 49,000 Total Town-Storm Water Systems 1,534,000 CFD Formation Cost 49 CFD Formation Cost 200,000 Total CFD Formation Cost 200,000 14,134,000 A-2 DOCSOC\988372v5\22925.0009 EXHIBIT B FORM OF PUD FACILITIES PAYMENT REQUEST Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) The undersigned hereby requests payment of the Purchase Price of the Segment or Segments described in Attachment A attached hereto. Capitalized undefined terms shall have the meanings ascribed thereto in the Acquisition and Funding Agreement, dated as of , 2003 (the "Acquisition Agreement"), by and between the Truckee Donner Public Utility District (the "PUD"), on behalf of itself and the Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) (the "CFD"), and Old Greenwood, LLC (the "Developer"). ,In connection with this Payment Request, the undersigned hereby represents and warrants to the CFD and the PUD as follows: 1. He (she) is a duly authorized officer of the Developer, qualified to execute this request for payment on behalf of the Developer and knowledgeable as to the matters forth herein. 2. Each of the Segments described in Attachment A has been completed in accordance with the Plans therefor. 3. The true and correct Actual Cost of each Segment for which payment is requested is set forth in Attachment A. 4. Attached hereto are invoices, receipts, worksheets and other evidence of costs which are in sufficient detail to allow the PUD Authorized Representative to verify the Actual Cost of each Segment for which payment is requested. 5. There has not been filed with or served upon the Developer notice of any lien, right to lien or attachment upon, or claim affecting the right to receive the payment requested herein which has not been released or will not be released simultaneously with the payment of such obligation, other than materialmen's or mechanics'liens accruing by operation of law. Copies of lien releases for all work for which payment is requested hereunder are attached hereto. 6. The Developer is in compliance with the terms and provisions of the Acquisition Agreement. I hereby declare under penalty of perjury that the above representations and warranties are true and correct. Date: Developer Representative B-1 DOCSOC\988372v5\22925.0009 APPROVAL BY THE PUD AUTHORIZED REPRESENTATIVE The Actual Cost of each Segment described in Attachment A has been reviewed, verified and approved by the PUD Authorized Representative. Payment of the Purchase Price of each such Segment is hereby approved. Date: By: Truckee Donner Public Utility District Assistant General Manager B-2 DOCSOC\988372v5\22925.0009 ATTACHMENT A Segment Acquisition Cost Actual Cost Purchase Price* Total Purchase Price to be Paid: *Lesser of Acquisition Cost or Actual Cost B-3 DOCSOC\988372v5\22925.0009 EXHIBIT C FORM OF TOWN FACILITIES PAYMENT REQUEST Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) The undersigned hereby requests payment of the Purchase Price of the Segment or Segments described in Attachment A attached hereto. Capitalized undefined terms shall have the meanings ascribed thereto in the Acquisition and Funding Agreement, dated as of , 2003 (the "Acquisition Agreement"), by and between the Truckee Donner Public Utility District (the "PUD"), on behalf of itself and the Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) (the "CFD"), and Old Greenwood LLC (the "Developer"). In connection with this Payment Request,the undersigned hereby represents and warrants to the PUD,the CFD and the Town as follows: 1. He (she) is a duly authorized officer of the Developer, qualified to execute this request for payment on behalf of the Developer and knowledgeable as to the matters forth herein. 2. Each of the Segments described in Attachment A has been completed in accordance with the Plans therefor. 3. The true and correct Actual Cost of each Segment for which payment is requested is set forth in Attachment A. 4. Attached hereto are invoices, receipts, worksheets and other evidence of costs which are in sufficient detail to allow the Town Manager of the Town to verify the Actual Cost of each Segment for which payment is requested. 5. The Developer has submitted or submits herewith to the Town Manager of the Town as-built drawings or similar plans and specifications for the Segments for which payment is requested, and such drawings or plans and specifications,as applicable,are true,correct and complete. 6. There has not been filed with or served upon the Developer notice of any lien, right to lien or attachment upon, or claim affecting the right to receive the payment requested herein which has not been released or will not be released simultaneously with the payment of such obligation, other than materialmen's or mechanics'liens accruing by operation of law. Copies of lien releases for all work for which payment is requested hereunder are attached hereto. 7. The Developer is in compliance with the terms and provisions of the Acquisition Agreement. I hereby declare under penalty of perjury that the above representations and warranties are true and correct. Date: Developer Representative C-1 DOCSOC\988372v5\22925.0009 APPROVAL BY THE TOWN MANAGER The Actual Cost of each Segment described in Attachment A has been reviewed,verified and approved by the undersigned. Payment of the Purchase Price of each such Segment is hereby approved. Date: TOWN OF TRUCKEE By: Town Manager APPROVAL BY THE PUD AUTHORIZED REPRESENTATIVE Based upon the representations and warranties of the Developer and the approval of the Town,payment of the Purchase Price for each Segment is hereby approved. Date: By: Truckee Donner Public Utilities District Assistant General Manager C-2 DOCSOC1988372v5\22925.0009 ATTACHMENT A Segment Acquisition Cost Actual Cost Purchase Price* Total Purchase Price to be Paid: *Lesser of Acquisition Cost or Actual Cost C-3 DOCSOC\988372v5\22925.0009