WATER SERVICE AGREEMENT BY AND BETWEEN RANGEVIEW METROPOLITAN DISTRICT, acting by and through its Water Activity Enterprise AND ELBERT & HIGHWAY 86 COMMERCIAL METROPOLITAN DISTRICT, acting by and through its Wild Pointe Water Activity Enterprise...
Exhibit 10.1
BY AND BETWEEN
RANGEVIEW METROPOLITAN DISTRICT,
acting by and through its Water Activity Enterprise
AND
XXXXXX & HIGHWAY 86 COMMERCIAL METROPOLITAN
DISTRICT,
acting by and through its Wild Pointe Water Activity
Enterprise
DECEMBER
15, 2016
TABLE
OF CONTENTS
Page
ARTICLE I CLOSING AND CONDITIONS PRECEDENT
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2
|
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1.1
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Closing
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2
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1.2
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Deliveries
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2
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1.3
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Conditions to the Obligations of Each Party
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2
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1.4
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Additional Conditions to the Obligations of Provider
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3
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1.5
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District Adoption of Rules and Regulations
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4
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1.6
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Water Report
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5
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1.7
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Termination
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6
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1.8
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Effect of Termination
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7
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ARTICLE II EXCLUSIVITY
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7
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2.1
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Exclusive Service
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7
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2.2
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Exclusive License to Water Rights
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7
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2.3
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Use of District Water System, Easements and Property
Interests
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7
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2.4
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Limitations
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8
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2.5
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Provider Facilities
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8
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ARTICLE III WATER SOURCES
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8
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3.1
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District Water
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8
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3.2
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Non-Potable Water
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9
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3.3
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Reuse Water
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9
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3.4
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Service Restrictions
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9
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ARTICLE IV OWNERSHIP, OPERATION, AND MAINTENANCE OF
FACILITIES
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11
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4.1
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Categories of Facilities and Ownership
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11
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4.2
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Service Commitment
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12
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4.3
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Provider Obligations
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12
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4.4
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Oversized Facilities
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14
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4.5
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District Obligations
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14
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4.6
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Cost Recovery for System Loss
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18
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ARTICLE V RECORDS AND INSPECTIONS
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19
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5.1
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Records Maintained by Provider
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19
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5.2
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Records Maintained by District
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19
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5.3
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Inspection of District Records
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20
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5.4
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Audit of District Records
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20
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5.5
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Inspection of Provider Records
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21
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ARTICLE VI BILLING AND RATES, FEES AND CHARGES
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21
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6.1
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District Rates, Fees and Charges
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21
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6.2
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Updates to District Rates, Fees and Charges
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21
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6.3
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Billing
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22
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ARTICLE VII RATES, FEES AND CHARGES; ADJUSTMENTS
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23
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7.1
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Adjustments to Rates, Fees and Charges
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23
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7.2
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Rate Studies
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23
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7.3
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Effectiveness of Adjusted Rates, Fees and Charges
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25
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7.4
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Fairness
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25
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ARTICLE VIII EXISTING AGREEMENTS
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25
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ARTICLE IX DISTRICT EXPANSION
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25
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ARTICLE X RULES AND REGULATIONS
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26
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10.1
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Enforcement
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26
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10.2
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Amendment
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26
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10.3
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Supersession
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27
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10.4
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No Limit on District Authority; Legislative Authority Not
Delegated
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27
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ARTICLE XI EVENTS OF DEFAULT; REMEDIES
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27
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11.1
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Events of Default
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27
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11.2
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Remedies for Events of Default
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28
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ARTICLE XII TERMINATION
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29
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12.1
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Termination
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29
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12.2
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Compliance with Regulations
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29
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ARTICLE XIII INDEMNIFICATION
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29
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13.1
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Indemnification by Provider
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29
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13.2
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Indemnity by District
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30
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13.3
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Exclusions and Acknowledgement
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30
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ARTICLE XIV MODIFICATION OR AMENDMENT
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31
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14.1
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Material Change in Regulatory Conditions
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31
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14.2
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Other Modifications or Amendments
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31
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ARTICLE XV MISCELLANEOUS PROVISIONS
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31
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15.1
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Relationship of the Parties
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31
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15.2
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Liability of Parties
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31
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15.3
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Insurance Requirements
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32
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15.4
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Notices
|
32
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15.5
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Representations
|
33
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15.6
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Regulatory Approval
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33
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15.7
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Dispute Resolution
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34
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15.8
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Governmental Immunity
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36
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15.9
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No Waiver
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36
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15.1
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Force Majeure
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36
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15.11
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Severability
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36
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15.12
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Form
|
37
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15.13
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Integration
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37
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15.14
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Third-Party Beneficiaries
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37
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15.15
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Counterparts
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37
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15.16
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Governing Law
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37
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15.17
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No Presumption
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37
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15.18
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Assignment
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38
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15.19
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Binding Effect; Covenants Run With the Land
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38
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EXHIBIT
INDEX
TITLE
Exhibit A Definitions
Exhibit B Property Description
Exhibit C District Water Rights
Exhibit D District Facilities
Exhibit E Taps Planned to be
Serviced Upon Build-Out
Exhibit
F
Undeveloped
Lots
Exhibit G District Rates, Fees and
Charges
This
Water Service Agreement (“Agreement”) is entered into to be
effective as of December 15, 2016 (the “Effective Date”), by and between
RANGEVIEW METROPOLITAN DISTRICT, a quasi-municipal corporation and
political subdivision of the State of Colorado, acting by and
through its Water Activity Enterprise (“Provider”), and XXXXXX &
HIGHWAY 86 COMMERCIAL METROPOLITAN DISTRICT, a quasi-municipal
corporation and political subdivision of the State of Colorado,
acting by and through its Wild Pointe Water Activity Enterprise
(“District”).
RECITALS
A. Capitalized
terms used in this Agreement shall have the meanings set forth or
as referenced on Exhibit A
or as indicated elsewhere in this Agreement.
B. District
is responsible for providing water service to customers within its
boundaries and service area, which consists of the real property
located in Xxxxxx County, as more specifically described on
Exhibit B attached hereto
(the “Property”).
C. District
has investigated matters relating to the long-term provision of
water services to District Customers and has determined that the
terms and provisions of this Agreement provide an economical,
dependable and beneficial means to provide such
services.
D. District
has determined that the execution and performance of this Agreement
will serve a public purpose and promote the health, safety,
prosperity and general welfare of District Customers by providing
for the planned and orderly provision of water
service.
AGREEMENT
In
consideration of the foregoing, the covenants and agreements set
forth herein, and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the parties agree as
follows:
ARTICLE
I
1.1 Closing.
Subject to the provisions of Sections 1.3 and 1.4, the closing (the
“Closing”) of
the transactions hereunder shall take place no later than
February 23, 2017, or on the second business day following the
satisfaction or waiver of all conditions to the obligations of the
parties to consummate the transactions contemplated hereby if
satisfaction and waiver occurs prior to February 23, 2017 (the
“Closing Date”),
at the offices of Xxxxx Xxxxxx & Xxxxxx LLP, 0000 Xxxxxxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000, or at such other time
and place as the parties may agree.
1.2 Deliveries.
At the Closing and in exchange for the exclusive rights granted by
District to Provider under this Agreement, Provider shall deliver
one million six hundred thousand and no/100 dollars ($1,600,000) by
wire transfer of immediately available funds to an account of
District designated in writing by District to Provider, and
District shall deliver a xxxx of sale and assignment in sufficient
form to convey to Provider ownership of the SCADA system and the
automated meter reading system described in Section 6.3(a). In
addition, District and Provider’s designated representatives
shall use best efforts to complete the appointment of two (2)
individuals designated by Provider to the board of directors of the
District. The District understands and acknowledges that the
appointment of the two directors is a material provision and if
such appointment cannot be accomplished, this Agreement is subject
to termination pursuant to Section 1.7(d) hereunder.
1.3 Conditions
to the Obligations of Each Party. Unless these
conditions are waived in writing by the parties, the obligations of
each party to effect the transactions contemplated by this
Agreement shall be subject to the fulfillment at or prior to the
Closing Date of the following conditions:
(a) No
preliminary or permanent injunction or other order, decree or
ruling issued by a governmental authority, nor any statute, rule,
regulation or executive order promulgated or enacted by any
governmental authority, shall be in effect that would make the
transactions contemplated by this Agreement illegal or otherwise
prevent the consummation of the transactions contemplated by this
Agreement;
(b) All
waivers, consents, approvals and actions or non-actions of any
governmental authority and of any other third party required to
consummate the transactions contemplated by this Agreement shall
have been obtained and shall not have been reversed, stayed,
enjoined, set aside, annulled or suspended, except for such
failures to obtain such waiver, consent, approval or action which
would not be reasonably likely (i) to prevent the consummation of
the transactions contemplated hereby or (ii) to have a material
adverse effect on either party;
(c) Each
party shall have performed or complied, in all material respects,
with each obligation, agreement and covenant to be performed or
complied with by it hereunder at or prior to the Closing Date;
and
(d) The
representations and warranties of each party in this Agreement
shall be true and correct on the date of this Agreement and on the
Closing Date.
1.4 Additional
Conditions to the Obligations of Provider. The obligations
of Provider to effect the transactions contemplated by this
Agreement are also subject to the fulfillment at or prior to the
Closing Date of the following conditions, unless such conditions
are waived in writing by Provider:
(a) District
shall have adopted the District Rules and Regulations referenced in
Section 1.5;
(b) District
shall have delivered the report of Xxxxx Xxxxxx, referenced in
Section 1.6 and complied with the provisions in Section 1.6 related
to such report; and
(c) Provider
shall have completed, and in its sole discretion be satisfied with
the results of, its due diligence investigation of District,
including but not limited to the condition of the District
Systems.
1.5 District
Adoption of Rules and Regulations. A condition
precedent to the Closing and the continued effectiveness and
enforceability of this Agreement shall be District’s adoption
and continued maintenance and enforcement of the rules and
regulations of Provider, as such rules and regulations may be
amended from time to time in Provider’s discretion (the
“Rangeview Rules and
Regulations”), with only such additions, deletions or
modifications thereto as may be approved in writing by Provider.
The Rangeview Rules and Regulations as adopted by the District with
such modifications as are approved by the Provider shall be
hereafter referred to as the “District Rules and Regulations.”
The District Rules and Regulations shall include, without
limitation, provisions that:
(a) Exclusive
Service. Require all District Customers to exclusively
connect to and receive metered water service from the District
Water System;
(b) Rule
Updates. Provide for automatic updates to the District Rules
and Regulations effective as of the same date that updates to the
Rangeview Rules and Regulations become effective, except that the
following provisions shall not be updated automatically:
(i) provisions of the District Rules and Regulations that
correspond to Article 6, “Fees and Charges;”
Article 12, “Water Fees and Charges;”
§ 11.2.a, charges for water meters; § 11.3.a,
charges for licenses; § 11.7, charges for pool permits;
and § 11.8, credits for dedication of water, of the
Rangeview Rules and Regulations (collectively, the
“District Rates, Fees and
Charges”); (ii) any provision in an update which
contravenes the provisions of Title 32, Article 1, C.R.S., or any
other law or regulation to which the District is subject, (iii) any
provision in an update which reduces the rights and privileges of
the District in this Agreement, (iv) any provision in an update
which enlarges the rights and privileges of the Provider in this
Agreement or which nullifies any obligation of Provider under this
Agreement, and (v) such other provisions as may be approved in
writing by Provider. Any dispute as to the automatic effectiveness
of a provision included in an update due to subparagraphs (ii)-(iv)
above shall be resolved pursuant to the provisions of
Section 15.7.
1.6 Water
Report. District shall
provide to Provider within sixty (60) days after the Effective
Date, at District’s cost and expense, a letter report
confirming the current state of title with respect to the Water
Rights (as defined in Section 3.1) by Xxxxx Xxxxxx or another
attorney of District’s choice reasonably acceptable to
Provider, along with copies of all documents that were utilized or
relied upon by District’s water attorney in preparing the
report. The report shall be based, at a minimum, upon a review of
the records of the Xxxxxx County Clerk and Recorder for the Water
Rights and overlying land for a period reasonably greater than (i)
the date of the decree(s) for all of the Water Rights, or (ii)
1973, whichever is earlier, and a review of the records of the
Colorado Division of Water Resources related to the Water Rights
and overlying land rights. Provider shall have twenty (20) days
after receipt of the report to review the report and notify
District of any objections to the state of title to the Water
Rights. If District receives timely written notice of objections to
title to the Water Rights from Provider, it shall within fifteen
(15) days of receipt of such notice, either (i) notify Provider in
writing that District is unable or unwilling to remove or satisfy
the matters raised in Provider’s written objection, in which
case Provider shall elect by written notice to District within ten
(10) days of receipt of District’s notice to terminate this
Agreement or be deemed to have waived such objection; or
(ii) notify Provider of District’s intent to remove or
satisfy the objection within such time as may be reasonably
required by District to effect the removal or satisfaction, in
which case District shall be entitled to an appropriate extension
of the Closing Date, but in no event longer than sixty (60) days.
Provider shall be deemed to have consented to such extension of
time to cure in favor of District. If District fails to remove or
satisfy the objection within the time specified (and Provider does
not waive its objection thereto), this Agreement shall
terminate.
1.7 Termination.
This Agreement may be terminated at any time prior to the Closing
Date, or on the Closing Date for subparagraph (d) below, whether
before or after approval of this Agreement and the transactions
contemplated herein:
(a) by
mutual written consent of the parties;
(b) by
either party if the Closing Date shall not have occurred on or
before February 23, 2017; provided, however, that the right to
terminate this Agreement under this Section 1.7(b) shall not
be available to any party whose breach of any obligation under this
Agreement has been the cause of, or resulted in, the failure of the
Closing Date to occur on or before such date;
(c) by
either party if a court of competent jurisdiction or other
governmental authority shall have issued an order, decree or ruling
or taken any other action (which order, decree or ruling each of
the parties hereto shall use all reasonable efforts to lift), in
each case permanently restraining, enjoining or otherwise
prohibiting the transactions contemplated by this Agreement, and
such order, decree, ruling or other action shall have become final
and non-appealable; or
(d) by
Provider if the appointment of two directors designated by Provider
shall not be accomplished on the Closing Date.
1.8 Effect
of Termination. Upon the
termination of this Agreement pursuant to Section 1.7, this
Agreement shall forthwith become null and void without any
liability or obligation on the part of any party, except to the
extent that such termination results from the breach by a party of
any of its representations, warranties, covenants or agreements set
forth in this Agreement.
ARTICLE
II
2.1 Exclusive
Service. Provider shall
have the sole and exclusive right to furnish water services to the
District, and the District shall require all District Customers to
receive service from the District.
2.2 Exclusive
License to Water Rights. Effective as of
the Closing Date, District hereby grants Provider an exclusive
license to use, re-use, treat, and distribute the Water Rights,
including the return flows therefrom, in accordance with the water
decrees by which such Water Rights have been or may be adjudicated
(i) for the purpose of furnishing water service to District
Customers in accordance with the terms of this Agreement, and (ii)
for other such purposes as Provider deems appropriate as long as
such other uses do not impair water service to District
Customers.
2.3 Use
of District Water System, Easements and Property
Interests. Effective as of
the Closing Date, District hereby grants to Provider an exclusive
license to use the District Water System for the purposes of and
pursuant to the provisions of this Agreement and a non-exclusive
license to use any easements, rights-of-way or other property
interests held or owned by District, or hereafter acquired by
District, as may reasonably be required or useful to accommodate
(i) Provider’s operation and maintenance of the District
Water System and (ii) subject to the limitation set forth in
Section 2.2, Provider’s distribution of the Water Rights.
District shall reasonably cooperate with Provider to enable
Provider to obtain, on District’s behalf, such additional
easements, rights-of-way or other property interests reasonably
required to enable Provider to perform its obligations under this
Agreement. If Provider recommends or District requires that the
location of any easements, rights-of-way or other property
interests be adjusted, the parties agree to cooperatively work
together on relocating easements (and any water facilities that may
exist therein or that may be affected by the relocation). The
District’s cooperation does not create any obligation for the
District to purchase or provide funds in any manner, or to expend
funds in any manner to obtain, acquire or relocate the additional
easements, rights-of-way or other property interests described
herein.
2.4 Limitations.
Provider acknowledges that unless expressly agreed to by the
District in writing, the Water Rights, the District Water System,
the rights-of-way and any other rights of the District with respect
to the Water Rights and the District Water System shall not be used
for any business or other purpose except as permitted by this
Agreement.
2.5 Provider
Facilities. District
acknowledges that Provider owns and operates other water rights and
water, irrigation water, and wastewater facilities to provide water
and wastewater services to customers other than the District and
District Customers, and in the absence of a written agreement to
the contrary, Provider shall have no obligation to use such other
water rights or facilities to provide service to the Property or
District Customers.
ARTICLE
III
3.1 District
Water. District owns the
water rights, as more specifically described on Exhibit C attached hereto (the
“Water Rights”).
Subject to the license granted to Provider in Section 2.2, District
shall retain ownership, dominion and control of the Water Rights,
and other water owned or legally available to District, including
the right to use and reuse said water until
extinction.
3.2 Non-Potable
Water. Provider and
District agree that the District’s Customers would be best
served, where feasible and if economically viable in the opinion of
each of Provider and District, to: (i) develop the District Water
System to include a “dual pipe distribution system”;
and (ii) use non-potable water for non-residential irrigation
purposes including, but not limited to, common areas, parks,
community spaces, schools, and other open spaces.
3.3 Reuse
Water. District
Customers shall not have any right to make a succession of uses of
the Water Rights. Provider shall have the exclusive right to make
any subsequent uses of the Water Rights for augmentation water,
delivery of non-potable water, or other uses in the sole discretion
of Provider.
3.4 Service
Restrictions . The parties agree
that Provider may, in order to comply with any applicable law,
rule, directive or order, and to enable it to provide adequate
services to District Customers, in times of shortage or other
practical or legal limitations on the ability of Provider to
provide the services contemplated hereby, limit the delivery of
water services, and/or restrict the use of water delivered
hereunder. The extent to which limitation of services may be
necessary to enable Provider to provide adequately for all District
Customers is a fact to be determined by Provider as circumstances
may require. The current policy to be applied by the Provider with
respect to its operations on behalf of the District, which will not
be changed without good reason, is as follows:
The
welfare of District’s customers requires stable water
services. While it is the purpose of District to maintain systems
and supplies adequate to meet the needs of all dependent upon
District for water services, there are many elements which make it
uncertain whether such services can always be adequate for all, and
therefore in times of shortage or other practical or legal
limitation, water use, and therefore the use of District’s
systems, will be curtailed on the following basis, the first listed
curtailment being adopted to meet the least serious situation and
the succeeding curtailment being adopted in addition to prior
listed curtailments, the last to meet the gravest possible
situation and one which reasonable precautions must be taken to
avoid, to-wit:
a. Restriction
of uses (such as irrigation), which can be accomplished without
serious injury to person or property and prohibition of
non-essential uses.
b. Prohibition
of irrigation except for commercial greenhouses.
c. Prohibition
of every use except for domestic use and for essential commercial
enterprises and industry.
d. Prohibition
of all use except domestic uses.
Such
curtailments shall be imposed, if at all, uniformly upon the
Property and other areas served by Provider using the Water Rights
or District Water System; provided, however, in the event of a
failure of the District Water System, action of a governmental
authority particularly affecting the Property or other cause to
curtail service in only the Property, Provider may act to curtail
service only in the Property. Provider shall give District written
notice prior to the enactment of any restriction in service at
least (30) days in advance, if practicable, and if not, as far in
advance as is practicable. Such notice shall provide all
information in Provider’s possession that has caused it to
conclude that restrictions are necessary. Upon implementation of
the restriction of service, Provider shall provide notice no less
than weekly to District concerning any change in the circumstances
that led to the restrictions and an estimate of when the
restrictions will be lifted or enlarged.
ARTICLE
IV
.
(a) District
Facilities. District owns or plans to own upon build-out the
facilities comprising the District Water System, as more
specifically described on Exhibit
D attached hereto, to provide water services District
Customers. District shall retain (i) ownership of and (ii) except
to the extent provided in Section 4.3 (with respect to replacing
facilities exceeding their useful life) and Section 4.6, sole
responsibility for financing and constructing all Wholesale and
Retail Facilities that now exist or may be constructed in the
future to provide potable and non-potable water service to District
Customers. Exhibit E
attached hereto sets forth the following information with respect
to taps planned to be serviced by the District Water System upon
build-out: (x) the number of unpaid residential taps remaining; (y)
the number of taps purchased for homes under construction; and (z)
the number of unpaid commercial taps remaining. Exhibit F attached hereto consists of a
map of the remaining undeveloped lots on the Property and sets
forth the owner of each such lot. The District represents and
warrants that as of the Effective Date the information set forth on
Exhibits B, C, D, and E, and, to its knowledge, the
information set forth on Exhibit
F, is true and complete in all material respects. Except as
set forth in Section 1.3(d), the District has no continuing
obligation to update the information in Exhibits B, C, D and
E.
(b) Customer
Facilities. Customer Facilities means service pipelines,
meters, plumbing and related appurtenances necessary and
appropriate to deliver potable water service from the point of
connection from the District Water System and, if applicable,
irrigation water service from the point of connection from the
District Irrigation Water System to individual District Customers.
District Customers shall retain ownership and responsibility for
the construction, maintenance, expansion, extension or modification
of all Customer Facilities in compliance with District Rules and
Regulations.
(c) Special
Facilities. Responsibility for construction and operation of
specific Special Facilities will be determined by separate
agreements. Examples of Special Facilities include, but are not
limited to, pumping stations or additional storage facilities that
may be necessary to serve a specific site or location.
4.2 Service
Commitment. Commencing on the
Closing Date and subject to the terms of this Agreement, Provider
shall provide water services to District Customers using the Water
Rights and the District Water System, including (i) withdrawing and
treating the Water Rights using the District Wholesale Facilities
and delivering the Water Rights to the Customer Facilities and (ii)
operating and maintaining (including repairing and replacing) the
District Water System.
4.3 Provider
Obligations. Provider shall
operate and maintain the District Water System in compliance with
all applicable laws and regulations, in a commercially reasonable
time and manner consistent with prudent water service provider
practices in Colorado and in accordance with this Agreement and the
District Rules and Regulations. Maintenance of the District Water
System includes the obligation to replace the District Water System
as necessary based on the useful life of the facilities and
components comprising the District Water System.
(a) Duties.
Provider shall employ or contract with such engineers and/or
qualified operators as it deems appropriate to perform the duties
of operating the District Water System, including the
following:
(i) cooperating
with state, county, local and federal authorities in providing such
tests as are necessary to maintain compliance with appropriate
governmental standards;
(ii) supervising
the connection of Customer Facilities to District Water System
after the issuance of taps by the District to New Customers and
recording such connections for billing proposes in accordance with
Section 5.1;
(iii) coordinating
construction with various utility companies to ensure minimum
interference with the District Water System;
(iv) performing
all maintenance and repairs necessary to continue the efficient
operation of the District Water System;
(v) providing
for emergency preparedness to provide response to emergencies,
including, but not limited to, interruption of services because of
line breaks, freeze-up or other mechanical problems;
and
(vi) providing
monthly billing to District Customers, collection efforts and
enforcement of the District Rules and Regulations.
(b) Contractors.
To the extent Provider engages contractors, it shall require such
contractors to maintain bonds and insurance, including
workers’ compensation insurance, in compliance with
applicable laws and regulations, including the District Rules and
Regulations.
(c) Control
of Service. Subject to the terms of this Agreement, Provider
shall have the responsibility for and control over the details and
means for providing the services hereunder.
(d) Authorizations.
Provider shall, at its own expense, apply for and obtain all
necessary permits, licenses, and other authorizations that may be
required by any governmental authority for Provider to operate and
maintain the District Water System in accordance with the terms of
this Agreement. District shall cooperate with and provide such
reasonable assistance to Provider as Provider may request in
obtaining such authorizations.
(e) Taxes.
Provider shall be solely responsible for and shall pay all taxes,
fees, charges and assessments, if any, in connection with the work
or the materials to be utilized in accomplishing the activities of
Provider pursuant to this Agreement.
(f) Financing.
Provider shall be responsible for financing its obligations
hereunder with the funds it receives pursuant to this Agreement or
from such other sources as it deems desirable.
4.4 Oversized
Facilities. If Provider
requests that the District oversize the District Water System, or a
portion thereof, for the purpose of allowing Provider to provide
water service to customers other than District Customers, the
parties shall enter into a separate cost-recovery agreement prior
to the time of construction of the oversized facilities in
question. Absent such a cost-recovery agreement, District shall
have no obligation to construct oversized District facilities under
this Section unless (i) construction of the oversized District
facilities is required by law, or (ii) Provider deposits funds
into an escrow account, on terms and conditions reasonably
acceptable to the District, for the estimated cost of the
oversizing and pays the actual costs attributable to such
oversizing, and (iii) Provider acquires any additional
easements or interests in land required by the oversizing at
Provider’s sole expense.
(a) Construction.
District has constructed the District Water System in substantial
compliance with all applicable laws and regulations. District shall
construct or cause to be constructed all future portions the
District Water System, at its sole expense, in compliance with all
applicable laws and regulations, in a commercially reasonable time
and manner consistent with prudent water service provider practices
in Colorado, and in accordance with this Agreement and the District
Rules and Regulations. With respect to the construction of the
District Water System, the District agrees as follows:
(i) to
construct or cause to be constructed the proposed portions of the
District Water System in compliance with the final plans and
specifications;
(ii) to
permit Provider or its designee to observe and inspect any and all
construction operations;
(iii) to
give reasonable notification (in any event not less than 48 hours)
of the time proposed to make connections to the existing District
Water System;
(iv) to
acquire all necessary easements, rights-of-way or other property
interests, at its expense, for the proposed facilities;
and
(v) to
contract for work and materials in accordance with all applicable
laws and regulations.
(b) Contractors.
To the extent District engages contractors, it shall require such
contractors to maintain bonds and insurance, including
workers’ compensation insurance, in compliance with
applicable laws and regulations, including the District Rules and
Regulations.
(c) Authorizations.
District shall, at its own expense, apply for and obtain all
necessary permits, licenses and other authorizations that may be
required by any governmental authority with respect to the
ownership, financing, and construction of the District Water System
and the acquisition and maintenance of the Water Rights (including
obtaining and complying with any decrees of the Colorado Water
Court and continuing due diligence obligations). Provider shall
cooperate with and provide such reasonable assistance to District
as District may request in obtaining such
authorizations.
(d) Plan
Access. District shall make available to Provider copies of
any and all designs, plans, specifications, construction drawings,
construction contracts and related documents concerning the
District Water System as Provider may request from time to
time.
(e) Unauthorized
Taps. District shall be responsible for enforcing the
District Rules and Regulations, including, without limitation,
taking such actions as are required to prevent unauthorized
connections to the District Water System. If District fails to
report any unauthorized connections to Provider, District shall be
fully liable for payment of all District Rates, Fees, and Charges
attributable to such unauthorized connections.
(f) Warranty
and Claims Enforcement. District shall timely submit and
pursue any warranty, insurance, damage or other claims District has
against a third party with respect to the Water Rights and/or
District Water System or provide appropriate authorization to
Provider to enable it on District’s behalf to timely submit
and pursue any such claim, and if the claim relates to a loss which
Provider is to repair pursuant to Section 4.3 or relates to a
System Loss that District wants Provider to handle on
District’s behalf pursuant to Section 4.6, District
shall make the proceeds of such claim available to Provider to
repair the Water Rights and/or District Water System, as
applicable.
(g) Facility
Locations. District will provide or make available to
Provider copies of all “as-built” drawings and/or GIS
mapping files for all facility locations, as well as copies of well
completion reports for all xxxxx supplying the District Water
System.
(h) Operation
and Maintenance Records. District will provide or make
available to Provider copies of all records related to the
operation and maintenance of the Water Rights and the District
Water System, including, but not limited to, maintenance logs,
water quality test results, recall notices, warranties, notices
from and correspondence with the Colorado Department of Public
Health and Environment and any other governmental authorities
related to the Water Rights or District Water System.
(i) Condition
of District Water System and Water Rights. District shall be
solely responsible for any and all losses, labilities, damages,
costs, and claims of any and every kind whatsoever related to the
existence and condition of the District Water System and the Water
Rights (a “System Loss”), other than a condition caused
by Provider’s failure to operate and maintain the District
Water System in accordance with the terms of this Agreement.
District’s responsibility with respect to any System Loss
includes, but is not limited to, any design or construction defect
of the District Water System except those portions of the District
Water System repaired or replaced by Provider pursuant to Section
4.3, any inadequacy of the Water Rights or the District Water
System as constructed by District but not including those portions
of the District Water System repaired or replaced by Provider
pursuant to Section 4.3, any violations of applicable laws or
regulations with respect to the District Water System or Water
Rights not caused by Provider’s operation and maintenance of
the District Water System, and any damage or destruction to the
District Water System or Water Rights by fire or other casualty or
contamination not caused by Provider’s operation and
maintenance of the District Water System. Providers’
obligations with respect to operating and maintaining the District
Water System hereunder include the obligation to maintain and
repair the District Water System due to normal wear and tear caused
in the ordinary course of business and to replace the District
Water System as necessary based on its useful life in order to
maintain the functionality required to provide water service to the
Property. In all other instances, except as otherwise provided in
Section 4.6, District shall diligently and continuously
prosecute the necessary reconstruction, replacement,
decontamination or other efforts required to restore the Water
Rights and District Water System to enable District and Provider to
provide water service as soon as practicable to the Property in
accordance with the terms of this Agreement and all applicable laws
and regulations.
. In
the event of any System Loss, Provider shall, at the request of the
District, conduct the necessary reconstruction, replacement,
decontamination or other efforts to restore the Water Rights and
District Water System on District’s behalf subject to the
following conditions:
(a) Cost
Plus Basis. Provider shall be reimbursed in full for the
total cost incurred by it to restore the Water Rights and District
Water System plus an additional percentage rate of return in the
amount specified by Provider as consideration for its efforts in
restoring the Water Rights and District Water System. Provider must
bid any work if and as required by C.R.S. § 32-1-1001(d),
as amended. If the District does not use the Provider for the
necessary reconstruction, replacement, decontamination or other
efforts, the Provider shall fully cooperate in providing all
necessary access to the entity working on the District Water
System.
(b) System
Loss Covered by Warranty, Insurance and Other Claims. If the
System Loss is covered by any warranty, insurance, damage or other
claim the District has against a third party with respect to the
Water Rights and/or District Water System, District shall comply
with the procedures set forth in Section 4.5(f).
(c) Interim
Rate Study. If a System Loss is not sufficiently covered by
a third party claim, the parties agree that an interim rate study
will be performed in accordance with Section 7.2 to determine
the costs to be incurred and possible recovery mechanisms. Each of
District and Provider shall pay fifty percent (50%) of the cost of
such study.
(d) Implementation
of Cost Recovery Mechanism. District and Provider shall
mutually work together to determine how the cost recovery process
should be implemented to finance the necessary efforts to restore
the Water Rights and District Water System, which may include,
among other things, increasing existing District Rates, Fees and
Charges, adding new rates, fees and charges, including special
assessments, or other financing mechanisms to fund the restoration
efforts. Other financing mechanisms could include, among other
things, allocating special assessments or new rates, fees and
charges to secure repayment of District bonds or loans. Any dispute
regarding the appropriate cost recovery mechanism and
implementation thereof shall be resolved pursuant to the provisions
of Section 15.7.
ARTICLE
V
5.1 Records
Maintained by Provider. Provider shall
keep and maintain accurate records of all contracts and expenses
related to the District Water System and all other records
necessary for the orderly administration and operation of the
District Water System that are required to be kept by applicable
laws and regulations or are of the type generally maintained
consistent with prudent water provider practices in Colorado.
Provider shall provide to District: (i) annual budgets and
operating plans with respect to the District Water System not later
than October 1 of each year for the following year; (ii) annual
reports on the status of the District Water System within twenty
(20) days of the end of each calendar year; and (iii) such other
information as District may reasonably request in order to assure
itself that the water demands of District are being adequately
provided for, to comply with its obligations under applicable laws
and regulations, and to assist District in its long-term planning
efforts.
5.2 Records
Maintained by District. District shall
keep and maintain (i) accurate books, records and accounts of all
collections and disbursements of District Rates, Fees and Charges;
(ii) records related to the issuance of taps; and (iii) such other
records as may be required by applicable laws and
regulations.
5.3 Inspection
of District Records. Provider shall
have the right, upon ten (10) days’ prior written notice, to
inspect the District’s records maintained hereunder to verify
the District’s compliance with this Agreement including,
without limitation the payment obligation set forth in
Article VI.
5.4 Audit
of District Records. Provider may,
upon not less than thirty (30) days’ prior written notice to
District, cause at Provider’s expense a partial or complete
audit of all District records related to the issuance of taps,
collection and disbursement of District Rates, Fees and Charges and
such other matters as may be reasonably related to determine
District’s compliance with its payment obligations to
Provider under this Agreement, including without limitation, the
amounts required under Article VI. Following completion of the
audit, Provider shall submit a written report to District detailing
any deficiencies determined upon such inspection or audit, if any
(a “Deficiency
Notice”). In the event that the District disputes any
finding of the Deficiency Notice, and said dispute is not resolved
within thirty (30) days’ of the delivery of the Deficiency
Notice, such dispute shall be submitted to mediation pursuant to
Section 15.7. Any finally determined deficiency shall be
immediately due and payable by District together with simple
interest thereon at the rate of ten percent (10%) per annum from
the date or dates such amounts should have been paid. If the
deficiency is in excess of five percent (5%) of the revenues
previously paid by District for the period covered by the audit,
then District shall also pay Provider the actual cost of the audit.
Such inspection right and audit right may be exercised no more than
one time each fiscal year of District, except if the prior
inspection showed a deficiency in excess of five percent (5%), in
which case an additional inspection may commence at any time prior
to the end of the third fiscal quarter of District in the year
following the audit period showing such deficiency.
5.5 Inspection
of Provider Records. District shall
have the right, upon ten (10) days’ prior written notice, to
inspect all records maintained by Provider related to the District
Water System. Such rights may be exercised no more often than once
each fiscal year of District, unless Provider otherwise
agrees.
ARTICLE
VI
6.1 District
Rates, Fees and Charges (a) .
District shall assess all District Rates, Fees and Charges for the
use and maintenance of the District Water System in accordance with
the District Rules and Regulations. All District Rates, Fees, and
Charges established in this Section 6.1 shall initially be assessed
at the amounts set forth on Exhibit G, attached hereto and are
subject to adjustment pursuant to Article VII. Commencing on the
Closing Date and thereafter, District shall remit to Provider all
District Rates, Fees and Charges received by District in accordance
with Section 6.3(b).
6.2 Updates
to District Rates, Fees and Charges. Section numbers
set forth next to the rates, fees and charges on Exhibit G correspond to the section
numbers in the current version of the Rangeview Rules and
Regulations. Notwithstanding Section 1.5, the section numbers and
the description of the rates, fees, and charges shall be
automatically updated to correspond to any revisions to the
Rangeview Rules and Regulations, and if the Rangeview Rules and
Regulations are amended to provide for additional rates, fees or
charges related to water service, such additional rates, fees or
charges shall be added to Exhibit G and the District Rules
and Regulations.
(a) Provider
shall read the meters and xxxx District Customers for water
services provided hereunder, including all Water System Development
Fees, consumption and other District Rates, Fees and Charges on
behalf of District and in accordance with the District Rules and
Regulations. The bills shall provide that payment shall be made by
District Customers to District at an address designated by
District. At the Closing, District shall transfer ownership of all
components of the Supervisory Control and Data Acquisition (SCADA)
system and the automated meter reading system to Provider so
Provider can read the meters and xxxx District Customers as
required by this Agreement.
(b) Provider
shall be responsible for collection efforts on delinquent accounts
and District hereby delegates to Provider, to the extent permitted
by law, all authority of the District in the name of and on behalf
of the District to conduct collection efforts on delinquent
accounts, including the authority to exercise all remedies
available to the District, including but not limited to shutting of
water service and placing liens on the property for which water
service accounts are delinquent. Provider shall not take any
actions in contravention of the requirements of Title 32, Article
1, C.R.S. District shall sign any authorizations or take such other
actions as may be reasonably required to enable Provider to act on
District’s behalf. District shall pay Provider on or before
the 15th day of each
month one hundred percent (100%) of all Water System Development
Fees and other District Rates, Fees and Charges collected from
District Customers in the previous month. Failure of District to
make any payments required under this Article VI when due shall
constitute an Event of Default pursuant to Article XI and, in
addition to any other remedy available to Provider, District shall
remain obligated to pay any such amounts together with interest at
the rate of eighteen percent (18%) per annum until fully
paid.
ARTICLE
VII
7.1 Adjustments
to Rates, Fees and Charges. Commencing in
February 2017, and in February for every year thereafter unless
otherwise determined by a rate study (in accordance with the
provisions of Section 7.2), the Water Consumption Charges shall be
adjusted. The rate of adjustment shall be computed by the
percentage change for the period from the second half of the year
two years prior to the second half of the prior year for the All
Urban Consumers (CPI-U) for the Denver-Boulder-Greeley, Colo.,
metropolitan area, all items less food and energy, as published by
the U.S. Bureau of Labor Statistics, By way of example, on February
1, 2017, the Water Consumption Charges will change by the
percentage change of the CPI-U published for the second half of
2015 to the second half of 2016. The CPI-U for the
Denver-Boulder-Greeley, Colo., metropolitan area can be accessed
at: xxxx://xxx.xxx.xxx/xxxxxxx/xxxxxxxx-xxxxxx/news-release/consumerpriceindex_denver.htm
7.2 Rate
Studies. Notwithstanding
the generally applicable rate adjustment set forth in Section 7.1,
unless otherwise agreed by the parties: (i) rate studies shall be
performed every three (3) years in the third quarter of the
applicable year, with the first such study to occur in the third
quarter of District’s 2019 fiscal year; and (ii) Provider and
District shall meet in the second quarter of each year (with the
first such meeting to occur in 2017) to determine whether an
interim rate study is desirable or required. All rate studies to be
performed hereunder shall be subject to the following terms,
provisions and requirements:
(a) Consultant
Qualifications. Rate studies shall be performed by a
consultant with experience in setting water rates jointly selected
and supervised by District and Provider, using assumptions mutually
agreed upon between District and Provider.
(b) Cost
of Studies. Each of the District and Provider shall pay
fifty percent (50%) of the costs of (i) rate studies required
under this Section and (ii) interim rate studies conducted
pursuant to subsection (c)(i) and (c)(ii) below.
(c) Interim
Studies. Interim rate studies will be performed: (i) if the
parties mutually determine that an interim rate study is desirable
or required; (ii) if changes are required that will materially
increase the cost of providing water service as contemplated by
this Agreement, including but not limited to changes required to
the Water Supply, the District Water System, or the operation and
maintenance procedures of the District Water System due to new or
revised statutory or regulatory criteria applicable to the Water
Rights or the District Water System, events of force majeure, or
other causes (a “Material Event”), or (iii) upon
the request of either party. Unless otherwise agreed upon by the
parties, the party requesting an interim rate study pursuant to
subsection (iii) shall be responsible for the cost of the
interim rate study. If either party disputes whether a Material
Event has occurred, then the parties shall utilize the dispute
resolution process described herein prior to initiating the interim
study.
(d) Material
Event. In the case of a Material Event, Provider shall
detail the specifics of the recovery of the investment required due
to the Material Event, including an amortization schedule and cost
of capital. The District may elect to have Provider make the
necessary investment or it may seek other parties to make such
investment, and in either case the costs will be recovered through
a rate adjustment as determined through a rate study. Provider or
District, as applicable shall bid any work if and as required by
C.R.S. § 32-1-1001(d), as amended. Any rate adjustment
attributable to such investment shall be allocated proportionately
among the parties (the Provider, the District, or a third party)
and/or instruments (i.e. debt) providing the funding.
7.3 Effectiveness
of Adjusted Rates, Fees and Charges. Except as
provided in Section 7.2(c), adjustments to the Water Consumption
Charges shall be made no more frequently than once a year, and any
such adjustments shall become effective on the March 1 next
following the date of determination of the adjustments. District
shall, from time to time, adopt or take such other legal actions as
may be required to give timely effect to such adjusted
rates.
7.4 Fairness.
District agrees that the terms of this Agreement, including without
limitation, the procedures for establishing and adjusting rates,
fees and charges, are fair and reasonable and shall be deemed in
all respects to be rationally related to their legitimate
governmental purpose.
ARTICLE
VIII
District represents
and warrants to Provider that District is not a party to any
existing agreements regarding the provision of water and/or the
collection of rates, fees, or charges related to same. Any loss,
cost, expense or damage suffered or incurred by Provider based on
or arising from the inaccuracy of such representation and warranty,
including but not limited to loss of revenues by Provider, shall be
the responsibility of the District and shall be payable to Provider
on demand and such payment shall accrue interest at the statutory
rate of interest as provided in C.R.S. § 13-21-101(3)
until paid in full.
ARTICLE
IX
The
District service area as of the Effective Date is set forth on
Exhibit B attached hereto.
Nothing herein shall be interpreted or construed as limiting the
District’s authority to expand its boundaries by including
new areas into its boundaries, nor shall anything herein be
interpreted or construed as requiring the District to expand its
boundaries. The parties will communicate with respect to master
planning for water service within the District, including those
areas anticipated or otherwise being considered for inclusion.
Prior to including any such areas and during the period of its
consideration of an inclusion agreement, District shall provide
notice to Provider of the proposed inclusion and afford Provider
reasonable and meaningful opportunity to comment with respect to
water service issues relating to any such area. Provider shall have
the exclusive first right, but not the obligation, to provide water
service on behalf of the District to any property included in such
expansion area. The inclusion agreement covering such area shall
expressly provide that water service to the included area shall be
subject to the terms of this Agreement and the applicable District
Rules and Regulations. If Provider declines to provide water
service to the proposed inclusion, District is free to obtain water
service by any means it deems appropriate; provided, however,
District may not use any portion of the existing District Water
System in arranging service to the newly included areas without
Provider’s consent.
ARTICLE
X
10.1 Enforcement.
District shall enforce compliance with the District Rules and
Regulations to the extent necessary to comply with the terms of
this Agreement, and District’s failure to enforce such
District Rules and Regulations in accordance herewith shall
constitute an Event of Default under this Agreement.
10.2 Amendment.
The parties acknowledge that the District Rules and Regulations may
need to be amended from time to time and agree that, during the
term of this Agreement, the District shall provide no less than
thirty (30) days prior notice to Provider before the District
adopts or approves any amendment to the District Rules and
Regulations. If Provider advises the District that it believes the
amended District Rules and Regulations will materially affect the
performance of the parties under this Agreement, said amendment
shall be the subject of a dispute to be resolved pursuant to the
provisions of Section 15.7.
10.3 Supersession.
If and to the extent there is any inconsistency between the terms,
covenants or provisions hereof and the District Rules and
Regulations, the terms, covenants and provisions of this Agreement
shall supersede and be controlling unless otherwise mutually agreed
upon in writing by the parties.
10.4 No
Limit on District Authority; Legislative Authority Not
Delegated. Nothing herein
shall be interpreted or construed as limiting the District’s
right to make and enforce ordinances, rules and regulations not
inconsistent with the terms of this Agreement. Nothing herein is
intended to delegate to Provider the legislative authority of the
District, which is reserved entirely to the District
notwithstanding any provisions of this Agreement.
ARTICLE
XI
11.1 Events
of Default. The occurrence or
existence of any one or more of the following events shall be an
Event of Default under this Agreement, and there shall be no Event
of Default hereunder except as follows:
(a) Non-Enforcement
of Rules. District fails or refuses to enforce the District
Rules and Regulations required by this Agreement;
(b) Non-Payment.
District fails or refuses to make any payment to Provider required
under this Agreement when due;
(c) Untrue
Representations. Any representation or warranty made by any
party in this Agreement proves to have been untrue or incomplete in
any material respect when made and such untruth or incompletion
would have a materially adverse effect upon the other
party;
(d) Failure
to Perform. Any party fails in the performance of any other
of its covenants in this Agreement and such failure continues for
thirty (30) days after written notice specifying such default is
given by the non-defaulting party; provided, however, if the
default is of a type which cannot be cured within such thirty (30)
day period, the cure period shall be extended by the non-defaulting
party if the defaulting party has commenced to cure the default
within thirty (30) days and at all times thereafter actively and
diligently continues to pursue the cure;
(e) Insolvency
or Dissolution. Proceedings under any bankruptcy law or
insolvency act or for the dissolution of a party shall be
instituted by or against a party, or a receiver or trustee shall be
appointed for all or substantially all of the property of a party,
and such proceeding shall not be dismissed or such receivership or
trusteeship vacated within sixty (60) days after such institution
or appointment; provided, however, that if a party seeks to
dissolve pursuant to C.R.S. § 32-1-701, et seq., as amended and (i) it
notifies the other party in writing concurrently with filing the
application for dissolution, and (ii) the plan for dissolution
shall include provisions for continuation of this Agreement with a
responsible party acceptable to the other party being substituted
as a party to this Agreement, and such substituted party assumes
all obligations and rights of the dissolving party hereunder, then
such dissolution shall not be a default.
(a) Enforcement
Rights. Upon the occurrence of an Event of Default, the
non-defaulting party may proceed to protect and enforce its rights
against the party causing the Event of Default by mandamus or such
other suit, action or special proceedings in equity or at law, in
any court of competent jurisdiction, including an action for
damages or specific performance, or by self-help. In the event of
any litigation or other proceeding to enforce any of the terms,
covenants or conditions hereof, the prevailing party in such
litigation or other proceeding shall obtain, as part of its
judgment or award, its reasonable attorneys’ fees and
costs.
(b) Limited
Termination Rights. Upon the occurrence of an Event of
Default, and after the non-defaulting party proceeds in accordance
with Section 11.2(a), the non-defaulting party shall be permitted
to terminate this Agreement only upon sixty (60) days advance
written notice to the defaulting party and only if: (i) monetary
damages are not paid by the defaulting party when due or (ii) the
defaulting party refuses to perform its obligations
hereunder.
ARTICLE
XII
12.1 Termination.
Except as provided in Section 11.2(b) and Section 1.7, this
Agreement shall remain in force unless terminated by mutual written
agreement of the parties.
12.2 Compliance
with Regulations. The parties
understand and agree that compliance with all applicable federal
and state regulations must take place at all times. In the event of
any termination of this Agreement, with or without cause, the
parties shall cooperate to ensure that there is no gap or break in
the compliance with all applicable regulations in the provision of
service to District Customers during the transition of service,
including the payment of all applicable District Rates, Fees and
Charges.
ARTICLE
XIII
13.1 Indemnification
by Provider. To the extent
authorized by law, Provider agrees to indemnify District from and
against any loss, cost, liability or expense (including reasonable
attorneys’ fees) reasonably incurred by District, including
both third-party and direct claims, arising out of or related to
(i) any failure of Provider to operate or maintain the
District Water System in compliance with applicable laws and
regulations, including, but not limited to, Environmental Laws; and
(ii) the negligent acts or omissions of Provider, its
officers, directors, employees, agents and consultants in the
course of performing Provider’s obligations under this
Agreement.
13.2 Indemnity
by District. To the extent
authorized by law, District agrees to indemnify Provider from and
against any loss, cost liability or expense (including reasonable
attorneys’ fees) reasonably incurred by Provider, including
without limitation, both third-party and direct claims, arising out
of or related to (i) the finance, design, ownership, or
construction of the District Water System, including but not
limited to, any failure of the District Water System or Water
Rights to comply with applicable laws and regulations, including,
but not limited to, Environmental Laws; (ii) the operation and
maintenance of the District Water System and Water Rights prior to
the Closing Date; and (iii) the negligent acts or omissions of
District, its officers, directors, employees, agents and
consultants in the course of performing District’s
obligations under this Agreement.
13.3 Exclusions
and Acknowledgement. Notwithstanding
the foregoing or any other indemnification provision in this
Agreement, no party shall have a duty under this Agreement to
indemnify and/or hold another party harmless from or against any
loss, cost, liability or expense to the extent caused or
contributed by the act or failure to act of the other party
(including its officers, directors, employees, agents and
consultants). Further, the parties hereto understand and
acknowledge that Colorado law does not currently enforce indemnity
clauses entered into by Colorado local governments in
contracts. The District and the Provider are Colorado local
governments and neither provides to the other any assurance or
warranty that the indemnification provided herein would be enforced
in any Colorado court or in any proceeding under Colorado
law.
ARTICLE
XIV
14.1 Material
Change in Regulatory Conditions. In the event any
state, federal or local entity shall materially change any
regulatory conditions applicable to the provision of water service
under this Agreement, the parties agree that they shall
expeditiously work together in good faith to modify or amend this
Agreement as necessary to comply, in a commercially reasonable
manner, with the changed regulations without otherwise materially
changing the terms and conditions of this Agreement.
14.2 Other
Modifications or Amendments. This Agreement
shall not be modified or amended without the consent of both
parties. No modification or amendment shall be effective unless in
writing, executed by all parties.
ARTICLE
XV
15.1 Relationship
of the Parties. Nothing contained
in this Agreement creates a joint venture, partnership, agency or
similar endeavor between the parties. Each party is acting solely
as an independent contractor, and neither party has any power or
authority to directly or indirectly bind or act on behalf of the
other.
15.2 Liability
of Parties. Nothing contained
in this Agreement, nor any obligation imposed upon a party
hereunder, nor the issuance and sale of bonds by a party, shall
constitute or create an indebtedness of the other party. Neither
party shall have any obligation whatsoever to repay any debt or
liability of the other party.
(a) District-Required
Insurance. District shall maintain in full force and effect,
throughout the term of this Agreement, property damage and
liability insurance with respect to all water facilities owned by
District and District’s duties hereunder, consistent with
insurance practices and coverages of prudent local governments
similarly situated.
(b) Provider-Required
Insurance. Provider shall maintain in full force and effect,
throughout the term of this Agreement, property damage and
liability insurance with respect to Provider’s duties
hereunder, consistent with insurance practices and coverages of
prudent water system operators similarly situated.
15.4 Notices.
Except as otherwise provided herein, all notices required to be
given under this Agreement shall be in writing and shall be
hand-delivered, sent by registered or certified mail, return
receipt requested, or electronically confirmed email transmission
to the following addresses:
District:
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Xxxxxx & Highway 86 Commercial Metropolitan District Attn:
District Managerc/o CliftonLarsonAllen8390 X Xxxxxxxx Xxxxxxx,
Xxxxx 000Xxxxxxxxx Xxxxxxx, XX 00000Xxxxx: xxxxxx.xxxxxxx@xxxxxxxxxx.xxx
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With a
copy to:
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Xxxxxx
X Xxxxxx
Xxxxxx
& Associates Law Offices, LLC
0000
Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx
XX 00000
Email:
xxxxxxx@xxxxxxx.xxx
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Provider:
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Rangeview Metropolitan DistrictAttn: Xxxxxxxxx000 Xxxxx Xxxxxxxxx,
Xxxxx 000Xxxxxxxx, XX 00000Xxxxx: xxxxxxxx@xxxxxxxxxxxxxx.xxx
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With
copy to:
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Xxxxx X. Xxxx, Esq.Xxxxx Xxxxxx & Xxxxxx LLP1550 –
17th Street, Suite 500Denver, CO 80202Email:
xxxxx.xxxx@xxxxxx.xxx
|
All
notices will be deemed effective: if delivered by hand on the date
of delivery; if mailed, three (3) days after mailing; and, if by
email, upon electronic confirmation of delivery. Any party may by
written notice change the address to which future notices shall be
sent.
(a) Authority.
It has all requisite power, corporate and otherwise, to execute,
deliver and perform its obligations pursuant to this Agreement,
that such actions have been duly authorized by it, and that upon
execution and delivery of this Agreement, the provisions hereof
will constitute its legal, valid and binding obligation,
enforceable against it in accordance with the terms
hereof;
(b) No
Litigation. There is no action, suit, inquiry, investigation
or proceeding to which it is a party, at law or in equity, which is
pending or, to the best of its knowledge, threatened, in connection
with any of the transactions contemplated by this Agreement wherein
an unfavorable decision, ruling or finding could reasonably be
expected to have a materially adverse effect on the validity or
enforceability of, or its ability to perform it obligations under,
this Agreement; and
(c) No
Conflict. Its execution, delivery and performance of this
Agreement is not in violation of, nor does it constitute an event
of default under, any other contract, agreement or instrument to
which it is a party.
15.6 Regulatory
Approval. The design,
construction, operation and maintenance of the facilities to serve
District Customers as provided for herein require that permits and
approvals be obtained from various regulatory entities, including
the State of Colorado. The parties shall cooperatively and
diligently pursue obtaining said regulatory approvals in such a
manner that water services contemplated by this Agreement can be
provided in a timely manner. District shall be primarily
responsible for obtaining necessary regulatory approvals for the
design and construction of the District Water System. Provider
shall be primarily responsible for obtaining necessary regulatory
approvals for the operation and maintenance of the District Water
System. The granting of such regulatory permits and approvals is
beyond the direct control of the parties to this Agreement. In the
event that any notice is received from a regulatory agency of a
potential delay or denial in the issuance of a necessary permit or
approval, the parties shall mutually cooperate to determine
solutions to lessen the impact of such delay or
denial.
(a) Representative
Negotiations. If a party believes there is a dispute under
this Agreement that has not been resolved in the normal course of
business, such party will give the other party a written notice of
the dispute (the “Dispute
Notice”). The Dispute Notice shall designate the name
and title of the representative authorized to resolve such dispute.
The other party shall send a response designating the name and
title of its representative authorized to resolve the dispute
within five (5) days of receipt of the Dispute Notice. The
representatives shall meet within fifteen (15) days following
receipt of the Dispute Notice at a mutually acceptable time and
place, and thereafter as often as they reasonably deem necessary to
attempt to resolve the dispute. All negotiations pursuant to this
clause are confidential and shall be treated as compromise and
settlement negotiations for purposes of applicable rules of
evidence.
(b) Mediation.
If a dispute is not resolved by the authorized representatives
within fifteen (15) days of their first meeting, or if a party
refuses to meet within that time period, then either party may
initiate binding mediation of the dispute in accordance with the
International Center for Conflict Prevention and Resolution
Mediation Procedure then currently in effect, as such procedure may
be modified by mutual written agreement of the parties. The
mediator’s fee shall be shared equally by the parties. The
mediator designated or appointed shall have: (i) at least ten (10)
years’ experience as a mediator or arbitrator; and (ii)
preference shall be given to mediator with experience in the
development, financing, operation and management of municipal water
systems. To the fullest extent allowed by law, the parties agree to
recognize and be bound by the final decision of the
mediator.
(c) Court
Resolution. If a dispute has not been resolved pursuant to
mediation within sixty (60) days after the initiation of such
procedure, or if a party will not participate in mediation, any
party may initiate litigation in the District Court in and for
Xxxxxx County, Colorado or, to the extent appropriate, the Water
Court in Water Division I. In any such lawsuit in Xxxxxx County
District Court, the parties agree to request the appointment of a
special master if the issues between them in such case involve
complex technical or economic aspects of water service, including
without limitation, rates and charges. The costs of such special
master shall be shared equally by the parties.
(d) Obligations
Uninterrupted. Pending final resolution of any dispute,
District must remain current on all payment obligations to
Provider, and water service by Provider shall continue
uninterrupted.
(e) Exclusivity.
The procedures specified in this Section shall be the sole and
exclusive procedures for the resolution of disputes (which shall
not include undisputed Events of Default) between the parties
arising out of or relating to this Agreement; provided, however,
that a party may use self-help or seek a preliminary injunction or
other preliminary relief if, in the judgment of that party, such
action is necessary to avoid irreparable damage. Despite the
initiation of any such judicial proceedings, the parties will
continue to participate in good faith in the procedures specified
in this Section.
15.8 Governmental
Immunity. Nothing herein
shall be construed as a waiver of the rights and privileges of the
Provider or the District pursuant to the Colorado Governmental
Immunity Act, C.R.S. § 00-00-000, et seq., as amended.
15.9 No
Waiver. No party shall
waive its rights hereunder by failing to exercise its rights; any
such failure shall not affect the right of such party to exercise
at some future time the rights not previously
exercised.
15.10
Force
Majeure. Should any party
be unable to perform any obligation required of it under this
Agreement because of any cause beyond its control and not due to
the party’s fault or negligence, including but not limited to
war, insurrection, riot, civil commotion, strikes, lockout, fire,
earthquake, windstorm, drought, flood, action or inaction of
governmental authorities (including the adoption of new or revised
rules and regulations), moratoriums, material shortages, or any
other force majeure, each party’s performance of the
obligation affected shall be suspended for so long as such cause
prevents it from performing such obligation, without liability on
its part.
15.11
Severability. If any clause or
provision of this Agreement is illegal, invalid or unenforceable
under present or future laws effective during the term of this
Agreement, then, and in that event, it is the intention of the
parties hereto that the remainder of this Agreement shall not be
affected thereby. It is also agreed that in lieu of each clause or
provision of this Agreement that is illegal, invalid or
unenforceable, there shall be added as a part of this Agreement a
clause or provision as similar in terms to such illegal, invalid or
unenforceable clause or provision as may be possible and be legal,
valid and enforceable.
15.12
Form. Headings and
titles of this Agreement are for convenience only and do not hold
any substantive meaning.
15.13
Integration. This Agreement,
including the Exhibits attached hereto, shall be construed and
enforced as the fully integrated expression of the parties’
agreement with respect to the matters addressed. No express or
implied covenant not specifically set forth herein shall be a part
of this Agreement. The parties expressly aver that no
representations other than those specifically set forth in this
Agreement have been relied upon by either party to induce it to
enter into this Agreement.
15.14
Third-Party
Beneficiaries. It is not the
intent of the parties, nor shall it be the effect of this
Agreement, to vest rights of any nature or form in individuals or
entities not executing this Agreement as a party.
15.15
Counterparts. This Agreement
may be executed in one or more counterparts, all of which together
shall constitute one and the same instrument.
15.16
Governing
Law. This Agreement
shall be governed by and construed in accordance with the laws of
the State of Colorado and applicable federal law.
15.17
No
Presumption. The parties to
this Agreement and their attorneys have had a full opportunity to
review and participate in the drafting of the final form of this
Agreement. Accordingly, this Agreement shall be construed without
regard to any presumption or other rule of construction against the
party causing the Agreement to be drafted.
15.18
Assignment. Except for the
assignment by District to another governmental entity, this
Agreement shall not be assignable by District or Provider without
the prior written consent of the other party, which consent shall
not be unreasonably withheld or delayed.
15.19
Binding Effect; Covenants
Run With the Land. The covenants,
terms, conditions and provisions set forth in this Agreement shall
be binding upon and inure to the benefit of the parties hereto and
to their respective successors and permitted assigns and shall run
with the Property. This Agreement or a Memorandum of Agreement may
be executed by the parties and recorded against the
Property.
[Signature page and Exhibits follow.]
IN
WITNESS WHEREOF, parties have executed this Water Service Agreement
effective as of the day and year first written above.
XXXXXX & HIGHWAY 86 COMMERCIAL METROPOLITAN DISTRICT, acting by
and through its Wild Pointe Water Activity Enterprise
|
|
|
|
|
|
By:
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/s/
Xxxx Xxxxxxx
|
|
Xxxx
Xxxxxxx, President
|
|
|
RANGEVIEW METROPOLITAN DISTRICT, acting by and through its Water
Activity Enterprise
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|
|
|
|
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By:
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/s/
Xxxx Xxxxxxx
|
|
Xxxx X.
Xxxxxxx, President
|
Exhibit A
DEFINITIONS
1. “Agreement”
means this Water Service Agreement by and between District and
Provider, as may be supplemented or amended from time to
time.
2. “Closing”
means as defined in Section 1.1.
3. “Closing
Date” means as defined in Section 1.1.
4. “CPI-U”
means as defined in Section 7.1. In the event that the CPI-U
shall subsequently be converted to a different standard reference
base or otherwise revised, the determination involved shall be made
with the use of such conversion factor, formula or table for
converting such CPI-U as may be published by the U.S. Bureau of
Labor Statistics, or if the Bureau shall not publish the same, then
with the use of such conversion factor, formula or table as may be
published by any nationally recognized publisher of similar
statistical information. In the event that the CPI-U shall cease to
be published, then for the purposes of this Agreement, there shall
be substituted such other index as the parties shall agree
upon.
5. “Customer
Facilities” means as defined in
Section 4.1(b).
6. “Deficiency
Notice” means as defined in Section 5.4.
7. “District”
means as defined in the first paragraph of this
Agreement.
8. “District
Customers” means existing and future users of water
services located within the boundaries of the
Property.
9. “District
Rates, Fees and
Charges” means as defined in
Section 1.5(b).
10. “District
Rules and Regulations”
means the rules and regulations adopted by District, as defined in
Section 1.5 of this Agreement, as the same may be supplemented
or amended from time to time, which govern the provision of water
services to District Customers, subject to the terms and conditions
of this Agreement.
11. “District
Water System” means the Wholesale and Retail
Facilities owned by District that provide potable, and if
applicable, non-potable water to District Customers.
12. “Dispute
Notice” means as defined in Section
15.7(a).
13.
“Effective Date”
means as defined in the first paragraph of this
Agreement.
14. “Environmental
Laws” means any statute, law, ordinance, regulation,
rule, judgment, decree or order of any governmental authority or
court relating to any matter of pollution, protection of the
environment, environmental regulation or control regarding
Hazardous Substances.
15. “Hazardous
Substance” means any toxic or hazardous materials,
wastes or substances, defined as, or included in the definition of,
“hazardous wastes,” “hazardous materials”
or “toxic substances” under any Environmental Law,
including, but not limited to, friable asbestos, buried
contaminants, regulated chemicals, flammable explosives,
radioactive materials, polychlorinated biphenyls, petroleum and
petroleum products.
16. “New
District Customer” means: (i) a customer receiving
potable and/or non-potable water service from the District that is
issued a water tap for such service after the Effective Date; or
(ii) a customer receiving potable and/or non-potable water service
from the District who subsequently, due to either a change of use
of the property being served or an increased demand on the potable
and/or non-potable water system, is required by the District Rules
and Regulations to purchase or be allocated additional potable
and/or non-potable water tap(s) (including customers who may not be
required to physically install a new tap(s) where the existing tap
is capable, with respect to capacity, to accommodate the changed
use or increased demand).
17. “Property”
means as defined in Recital C.
18. “Provider”
means as defined in the first paragraph of this
Agreement.
19. “Rangeview
Rules and Regulations” means as defined in Section
1.5.
20. “Retail
Facilities” means improvements and facilities
necessary and appropriate to deliver potable and/or non-potable
water from their points of connection to Wholesale Facilities to
Customer Facilities including, but not limited to, water mains,
valves, fire hydrants, manholes and related appurtenances. Retail
Facilities are designed and constructed at the sole cost of the
owner of property within the District and conveyed at no cost to
the District for operation and maintenance in accordance with the
District Rules and Regulations.
21. “SFE”
means the measure of demand placed upon the District Systems by a
typical single-family detached residence, as determined under the
District Rules and Regulations.
22. “Special
Facilities” means any improvement or facility required
to provide water service to a specific property from Wholesale
Facilities of the District, but which is not a Wholesale Facility,
Retail Facility or Customer Facility (each as defined herein) and
for which ownership, construction and operation responsibilities
will be determined by separate agreement.
23. “System
Loss” means as defined in
Section 4.5(i).
24. “Water
Consumption Charge” means the monthly charge payable
by District Customers to District and District to Provider in
accordance with this Agreement for potable and/or non-potable water
delivered to the District Customers as measured by meters installed
at the points of connection between the Customer Facilities and the
District Water System at the rate(s) set forth on Exhibit G as adjusted pursuant to
this Agreement.
25. “Water
Rights” means as defined in Section 3.1.
26. “Water
Service Charge” means the monthly charge payable by
District Customers to District and District to Provider in
accordance with this Agreement for water service at the rate(s) set
forth on Exhibit G as
adjusted pursuant to this Agreement.
27. “Water
System Development Fee” means the fee payable by a
District Customer to District and District to Provider in
accordance with this Agreement with respect to any new or expanded
connection of a District Customer to the District Water System made
after the Closing Date, whether metered or unmetered.
28. “Wholesale
Facilities” means improvements and facilities
necessary and appropriate to acquire, treat, store and deliver
potable and/or non-potable water to Retail Facilities, including,
but not limited to, xxxxx, treatment plants, pumping stations,
tanks, reservoirs, transmission pipelines, and related
appurtenances.
A-1
Exhibit B
PROPERTY DESCRIPTION
X-0
Xxxxxxx X
XXXXXXXX
XXXXX RIGHTS
C-1
Exhibit D
DISTRICT
FACILITIES
(As
Built and to be Built)
D-1
Exhibit E
TAPS TO BE SERVICED UPON BUILD-OUT
REMAINING RESIDENTIAL & COMMERCIAL TAPS (as of
09/30/2016)
1.
Unpaid Residential Taps Remaining
a.
49 Total unpaid
taps
2.
Taps Purchased for Homes under Construction
a.
18 homes under
construction, of which 4 have already paid the Tap Fee
3.
Unpaid Commercial Taps Remaining (Estimated – subject to
change)
Lot #
|
Anticipated Use
|
# Taps
Per Lot
|
Anticipated
Tap Size
|
1
|
Medical Office
|
1
|
2
|
2
|
Discount Store
|
1
|
1.5
|
3
|
Fast Food
|
1
|
1.5
|
4
|
Fast Food
|
1
|
1.5
|
5
|
Self Storage
|
1
|
2
|
6
|
DayCare
|
1
|
2
|
7
|
Health Care
|
1
|
3
|
8
|
Heath Care
|
1
|
3
|
10
|
AutoZone
|
1
|
1.5
|
12
|
Retail Shops
|
1
|
3
|
13
|
Xxxxxx Oil
|
1
|
1.5
|
14
|
Urgent Care
|
1
|
2
|
15
|
Fast Food
|
1
|
1.5
|
E-1
Exhibit F
UNDEVELOPED LOTS AND OWNERS
LOT#
|
Physical Address
|
Owner Name
|
Builder
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171
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32300 Badger Ridge Circle
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Xxxxx & Xxxx Xxxxxxx
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|
20
|
33305 Viewpointe Circle
|
Wild Pointe Investments
|
WilliamMRK Homes
|
23
|
00000 Xxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
73
|
0000 Xxxxxx Xxxxx
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Xxxxxxx X. Xxxxx/Xxxxx C
|
Xxxxx Custom homes
|
76
|
0000 Xxxxxx Xxxxx
|
Vida Pura Companies
|
Xxxx Xxxxxxxxx
|
94
|
32810 Legacy Ridge Street
|
Xxxxxx Xxxxxxxxxxx
|
n/a Perimeter Fence
|
113
|
473 Heritage Trail
|
Wild Pointe Investments
|
WilliamMRK Homes
|
114
|
000 Xxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
115
|
000 Xxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
116
|
000 Xxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
117
|
000 Xxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
118
|
270 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
119
|
264 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
120
|
250 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
121
|
242 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
122
|
240 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
123
|
236 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
124
|
230 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
125
|
226 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
126
|
224 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
127
|
222 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
128
|
220 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
129
|
218 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
130
|
214 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
131
|
210 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
132
|
208 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
133
|
213 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
134
|
225 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
135
|
229 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
136
|
243 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
137
|
255 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
138
|
265 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
139
|
285 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
140
|
395 High Xxxxxxx Loop
|
Wild Pointe Investments
|
WilliamMRK Homes
|
146
|
00000 Xxxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
147
|
00000 Xxxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
148
|
00000 Xxxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
149
|
00000 Xxxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
150
|
00000 Xxxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
151
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
152
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
153
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
154
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
155
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
156
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
157
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
158
|
00000 Xxxxxxxxx Xxxxxx
|
Wild Pointe Investments
|
WilliamMRK Homes
|
167
|
545 Heritage Trail
|
Wild Pointe Investments
|
WilliamMRK Homes
|
168
|
548 Heritage Trail
|
Wild Pointe Investments
|
WilliamMRK Homes
|
169
|
550 Heritage Trail
|
Wild Pointe Investments
|
WilliamMRK Homes
|
172
|
00000 Xxxxxx Xxxxx Xxxxxx
|
Xxxx & Xxxxx Xxxxxxx
|
|
177
|
000 Xxxxxxxxxx Xxxxxx
|
Destiny Construction
|
Destiny Construction
|
180
|
580 Heritage Trail
|
Wild Pointe Investments
|
WilliamMRK Homes
|
F-1
Exhibit G
DISTRICT RATES, FEES AND CHARGES
District Rates, Fees and Charges
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6.2*
|
System Review Fee
|
Actual Cost
|
6.3
|
Disconnection/Reconnection Charge
|
Actual Cost
|
6.4
|
Plan Review Fee
|
Actual Cost
|
6.5
|
Inspection/Observation Fee
|
Actual Cost
|
6.6
|
Permit Review Fee
|
Actual Cost
|
6.9
|
Cure Charge
|
Actual Cost
|
6.10
|
Civil Fines Pass Through
|
Actual Cost
|
11.2
|
Water Meter Purchase
|
Actual Cost
|
11.3a
|
Administrative License Fee
|
$50.00
|
11.8.j.i)
|
Renewable Water Dedication Credit, per SFE
|
$_____
|
11.8.j.ii)
|
Groundwater Dedication Credit, per SFE
|
$_____
|
12.1.a
|
Water System Development Fee, per SFE
|
$_____
|
|
Potable Water Consumption Charge:
|
|
12.2.b
|
First 0-10,000 gallons per month
10,001-20,000 gallons per month
Over 20,000 gallons per month
|
$___ per 1000 gallons
$___ per 1000 gallons
$___ per 1000 gallons
|
Non-Potable Water Consumption Charge
|
85% of corresponding potable water charges
|
|
12.2.c
|
Water Service Charge, per SFE (monthly)
|
$_____
|
12.3.a
|
Hydrant Use Fee
|
$40.00 per permit
|
12.3.b
|
Owner-initiated Shutoff Fee, each shutoff
|
$15.00 per hour
|
12.3.c
|
Fire Service Standby Fee, monthly fee
4-inch
6-inch
8-inch
|
$12.00
$18.00
$24.00
|
12.3.d
|
Well Site Surcharge
|
$_____ per acre
|
*Corresponds to section number in the Rangeview Rules and
Regulations.
G-1