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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 04/19/2022 - FIRST READING OF ORDINANCE NO. 051, 2022, AUTHORIZ Agenda Item 18 Item # 18 Page 1 AGENDA ITEM SUMMARY April 19, 2022 Utilities-Water Production STAFF Theresa Connor, Utilities Deputy Director Tawnya Ernst, Sr. Real Estate Specialist Eric Potyondy, Legal SUBJECT First Reading of Ordinance No. 051, 2022, Authorizing the City Manager and the Mayor to Enter into an Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project and to Execute Certain Conveyances Documents and an Agreement Attached Thereto. EXECUTIVE SUMMARY The purpose of this item is to seek Council approval of a proposed agreement (“Proposed Agreement”) between the City and the Landowners’ Association for Phantom Canyon Ranches (“Association”) regarding certain aspects of the City’s Halligan Water Supply Project (“Halligan Project”). The Association owns certain real property adjacent to Halligan Reservoir (which the City intends to enlarge) and along the North Fork of the Poudre River (“North Fork”). Since late 20 18, City representatives have collaborated with the Association to obtain property rights necessary for the Halligan Project and to address concerns raised by the Association, culminating in the Proposed Agreement. Under the Proposed Agreement: • The Association would: o convey the City a river access easement along the North Fork for Phase 1 (Permitting and Design) of the Halligan Project; o convey the City small parcels around Halligan dam needed for construction; and o resolve outstanding claims under historical agreements. • The City would: o grant the Association options to acquire: 121 acres below the Halligan Reservoir dam (“Halligan Dam”) that would be subject to restrictive covenants; easements along the reservoir and North Fork; and o modify an existing lease allowing the Association to use the surface of the reservoir until construction. Both parties also agree to work collaboratively on access for Phases 2 (Construction) and 3 (Operation and Maintenance). City staff analyses indicate that the Proposed Agreement is cost neutral and beneficial to the City and the Halligan Project. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. Agenda Item 18 Item # 18 Page 2 BACKGROUND / DISCUSSION Halligan Water Supply Project The City, through Fort Collins Utilities, is pursuing the Halligan Project. The Halligan Project will provide 7,900 AF of additional firm yield for Fort Collins Utilities water demands through 2065 with water of a quality comparable to the water now delivered to its customers. It will also pr ovide a storage reserve for emergency water supply, increase drought security; improve water system reliability and flexibility; and meet future water demands of the Fort Collins Utilities water service area. The Halligan Project includes: the enlargement of Halligan Reservoir, which primarily entails replacing Halligan Dam; and the replacement of the diversion structure for the North Poudre Canal and related infrastructure (“Diversion Structure”) on the North Fork. The City is and will be seeking various permits and approvals for the Halligan Project, including: a Clean Water Act Section 404 Permit from the United States Army Corps of Engineers; a fish and wildlife mitigation and enhancement plan from Colorado Parks and Wildlife and the Colorado Water Conservation Board; a Clean Water Act Section 401 Water Quality Certification from the Water Quality Control Division of the Colorado Department of Public Health and Environment; and a 1041 permit from Larimer County. The Halligan Project includes numerous environmental mitigation and enhancement actions that will avoid impacts, minimize impacts, compensate for unavoidable impacts, and enhance the environment, including providing minimum flows in the North Fork and eliminating existing and historical dr y-up reaches of the river. Information on the Halligan Project can be found here: Halligan Water Supply Project Update, April 9, 2019 Landowners’ Association for Phantom Canyon Ranches The Association owns real property adjacent to the Reservoir, the Diversion Structure, and along the North Fork (“Association Land”). The approximate locations of the Association Land are shown on the map below, which is also Exhibit A-1 to the Proposed Agreement. The Association Land includes several small parcels of land located near Halligan Dam which are not visible on the map due to the scale of the map. Agenda Item 18 Item # 18 Page 3 The Association currently represents forty -three landowners and Association Members, all of whom have an ownership interest in separate and distinct parcels of land near Halligan Reservoir. The individual members’ land is separate from the Association Land, which is used by all members. The Association an d its members have historically shown a commitment to the preservation of land in and around Halligan Reservoir. For instance, many of the lands owned by the Association and its Members are subject to conservation easements, and the Association has historically cared for the Reservoir and preserved and enhanced the habitat of the surrounding lands owned by the Association. Historical Relationship Between the City and the Association The City has contemplated the enlargement of Halligan Reservoir since the 1980s. The City and the Association and its predecessors have previously had various agreements and understandings associated with the enlargement of Halligan Reservoir. These include: • Agreement dated October 14, 1987 (“1987 Agreement”), with a predecessor of the Association (see Resolution 1987-161). o Under the 1987 Agreement, the City arguably agreed to convey certain easements to third -parties regarding the use of Halligan Reservoir and surrounding lands. Such transactions were never completed and the enforceability of the 1987 Agreement has been a matter of dispute. • Lease Agreement Between the City of Fort Collins and the Landowners Association for Phantom Canyon Ranches for Halligan Reservoir and Adjacent Properties, dated March 9, 2017 (“2017 Lease”) (see Ordinance 22, 2017). o Under the 2017 Lease, the Association leases from the City the rights to utilize the surface of the reservoir and surrounding lands for recreation and other limited uses until construction commences. Agenda Item 18 Item # 18 Page 4 Discussions and Negotiations The Association represents a significant number of Halligan Project neighbors and potentially -impacted stakeholders. City staff have thus remained in contact with the Association and its members periodically since the permitting processes for the Halligan Project began in 2004 to share information, hear and better understand the Association’s concerns, and to work towards addressing those concerns. As various aspects of the Halligan Project gained more certainty and as the project moved further towards reality, the Association began vocalizing more specific concerns about the Halligan Project to City staff and various regulatory agencies involved in the permitting process. Around this time in late 2018, the current round of discussions and negotiation began in earnest as the Halligan Project proceeded towards the release of its draft environmental impact statement. The Association and several of its members provided comments to the United States Army Corps of Engineers in the federal permitting process, underscoring the Association’s concerns. Since that time, City staff and Association representatives have met consistently, with multiple extended meetings in addition to numerous phone calls, to work through the City’s needs and how to address them in a way that minimizes impacts to and benefits the Association and the Livermore Valley. Rather than default to an adversarial or litigation posture, City staff and Association representatives built relationships and explored mutually-beneficial possibilities. It would be difficult to overstate the good faith and engagement of the Association representatives and their willingness to work through meticulous details and challenging issues. Proposed Agreement Benefits The result of the extended discussions is the Proposed Agreement (Exhibit A to the Ordinance). City staff views the Proposed Agreement as beneficial to the City, and the Halligan Project in particular, in that: • The City would acquire a river access easement along the North Fork for Phase 1 (Permitting and Design) of the Halligan Project, which will be necessary for various permitting activities. • The City would acquire several small parcels of land around Halligan Dam that are needed for construction activities. • Long-standing disagreements associated with the 1987 Agreement would be resolved in an amicable manner that honors the spirit of that agreement and addresses any potential liability for the City. • The City would preserve 121 acres of open space because the land convey ed to the Association would be subject to a restrictive covenant that would preclude development. • The City would retain the rights it needs to complete and operate the Halligan Project while working with a neighbor and long-term steward of the land. • The City would build relationships with most of the landowners in the Halligan Reservoir area, which will be helpful for additional access needs for Phases 2 and 3, as well as for long-term partnership and neighbor relations. Proposed Agreement Summary The executive summary above includes a high-level summary of the Proposed Agreement. The following is intended as a companion to the Proposed Agreement, summarizing its key terms paragraph by paragraph. Recitals and Para. 1. This portion of the Proposed Agreement provides general background and context. Para 2. This paragraph of the Proposed Agreement concerns the parties’ agreement to act in good faith now and in the future and addresses how future agreements will be executed. Para. 3. This paragraph of the Proposed Agreement identifies the three conceptual phases of the Halligan Project: Phase 1 (Permitting and Design); Phase 2 (Construction); and Phase 3 (Operation and Maintenance). The Halligan Project is currently in Phase 1. Para. 4. This paragraph of the Proposed Agreement addresses the City’s and Association’s relationship during Phase 1 (Permitting and Design). Agenda Item 18 Item # 18 Page 5 • Existing access agreements with the Association are listed. • The Association would convey to the City a river access easement along the North Fork. o Exhibit B of the Proposed Agreement is the specific form of easement deed that would be used. • The parties agree to work together on any future needs. • The City will retain the right to terminate the Agreement if the City decides to not p ursue the enlargement of Halligan Reservoir. If that were to happen, the parties would return things to their status before the Proposed Agreement were signed. • The map below shows the location of the easement. Para. 5. This paragraph of the Proposed Agreement addresses the City’s and Association’s relationship during Phase 2 Construction). • The parties would agree to coordinate and share information during construction. • The parties would agree to work together to address the City’s inundation needs and how to address power lines near the reservoir. • The parties would agree to a conceptual framework for how to address the City’s future access needs for Phase 2. This is because there is some uncertainty regarding various specifics of the City’s const ruction access needs because design has not been completed. The Association thus preferred to defer an agreement on Phase 2 access. • The City would not waive any right to potentially use eminent domain in the future for Phase 2. Para. 5. This paragraph of the Proposed Agreement addresses the City’s and Association’s relationship during Phase 3 (Operation and Maintenance). • The parties would agree to coordinate and share information for the completion of construction. • The parties would agree to a conceptual framework for how to address the City’s future access needs for Phase 3. This is because there is some uncertainty regarding various specifics of the City’s long -term Agenda Item 18 Item # 18 Page 6 access needs because permitting has not been completed. The Association thus pref erred to defer an agreement on Phase 3 access. • The City would not waive any right to potentially use eminent domain in the future for Phase 3. Para. 6. This paragraph of the Proposed Agreement addresses conveyances of real property rights between the parties. The framework is that when the Proposed Agreement is completed, the City and the Association would each acquire an option to acquire certain specified property in the future. • The City would acquire an option to acquire several small parcels of land around Halligan Dam. o Exhibit C of the Proposed Agreement is the specific form of deed that would be used. o The acquisition of these parcels is needed because they are near critical infrastructure and some of this land will be adversely affected during construction. o The small parcels on the north side of the reservoir would be subject to a restrictive covenant precluding development. o The small parcels on the north side of the reservoir near the dam would not be subject to a restrictive covenant because they are near critical infrastructure and may require some infrastructure located on them in the future. o The City could exercise the option shortly after the Proposed Agreement is signed so that the City owns these parcels before construction. • The Association would acquire an option to acquire approximately 121 acres south of Halligan Dam. o Exhibit D-1 of the Proposed Agreement is the specific form of deed that would be used. o This is land that is owned by the City and is surrounded by private parcels and therefore has no public access. Furthermore, it is remote and is thus not a candidate for public recreation. It is part of a larger parcel that was intended to support an earlier and larger iteration of the Halligan Project. This area is no longer needed by the City for the Halligan Project or other purposes. o This land would be subject to a restrictive covenant precluding development, thus preserving the land. o The City would retain needed access rights for Phase 3 of the Halligan Project. o The Association could exercise this option after Halligan Reservoir is enlarged. The reason for the delay is that, if the City were to no longer pursue the enlargement of Halligan Reservoir, under an agreement with the North Poudre Irrigation Company (“NPIC”), th e City would need to convey this land back to NPIC. • The Association would acquire an option to acquire an easement for limited recreation and grazing purposes along the southern shore of Halligan Reservoir west of the dam and an easement along the North Fork south of Halligan Dam. o Exhibits D-2 and D-3 of the Proposed Agreement are the specific forms of deed that would be used. o This land is not adjacent to publicly-accessible land and the southern shore of Halligan Reservoir is not accessible by any public road. It is thus not a candidate for public recreation. o The City would retain needed access rights for Phase 3 of the Halligan Project. o The Association could exercise this option after Halligan Reservoir is enlarged. The reason for the delay is that, if the City were to no longer pursue the enlargement of Halligan Reservoir, under an agreement with NPIC, the City would need to convey this land back to NPIC. • The locations of these conveyances are shown on Attachment 3, which is also Exhibit A-2 to the Proposed Agreement. Agenda Item 18 Item # 18 Page 7 • For all conveyances, surveys of the land would be completed after the Proposed Agreement is executed to identify specific acreages and legal descriptions. o The amount of the specific acreages would then be used in formulas incl uded in the Proposed Agreement to calculate the specific amounts due. These formulas include agreed -to fair market price per acre that are based on appraisal data. Para 8. This paragraph of the Proposed Agreement would modify the 2017 Lease. It current ly runs until construction begins but would be modified to extend until construction is complete. Para. 9. This paragraph of the Proposed Agreement would resolve any remaining disputes under the 1987 Agreement. Para. 10. This paragraph of the Proposed Agreement addresses recreation on the reservoir. Exhibit E to the Proposed Agreement includes a copy of the modified 2017 Lease to be signed. Historically, NPIC entered into agreements with the Association to allow it and its members to use the surface o f the reservoir. The City has continued this with the 2017 Lease. However, after the reservoir is enlarged, there are currently no plans for public recreation due to management and public safety concerns associated with the remote nature of the reservoir. Para. 11. This paragraph of the Proposed Agreement addresses what payments would be made when. Certain amounts would be due a month after the Proposed Agreement is executed. Other amounts would be due after Phase 2 (Construction) is completed. This is discussed in further detail below. CITY FINANCIAL IMPACTS To document compliance with City Code requirements regarding conveying real property at fair market values, City staff prepared the attached spreadsheet indicating the monetary values of ea ch of the conveyances and Agenda Item 18 Item # 18 Page 8 promises made between the parties. For values related to real property conveyances, these are fair market values. (Attachment 1) As indicated in the attached spreadsheet, within one month of the execution of the Proposed Agreem ent, $71,141 would be due to the Association. At the end of Phase 2 (Construction), approximately $129,649 would be due to the City, though this amount may vary slightly depending on the specific surveyed acreages to be conveyed. BOARD / COMMISSION RECOMMENDATION Because the Proposed Agreement fundamentally concerns real property transactions, no boards or commissions were consulted. PUBLIC OUTREACH Other than outreach to Association members and representatives, and discussions with various permitting agencies, there has been no public outreach. ATTACHMENTS 1. Value Spreadsheet (PDF) 2. Powerpoint Presentation (PDF) Page 1 CITY ACQUISITIONS Phase Linear Ft Area (S.F.) Area (Ac)*Value Value Assumptions Timing of Payment 1 Legal Fees $15,000 Agreed upon by Carol and Eileen 1/2/2020 - firm cap - to be paid at closing. Phase I only- ALREADY PAID. Payment completed August 2020 1 150'-wide TAE to River (7y)8,170 1,225,500 28.13 $59,081 Area x 10% FMV ($3,000/acre) x # years (7) Umbrella Agreement Execution $74,081 3 Purchase: small parcels in Sect. 34 26,571.60 3.61 $10,830 Area x FMV ($3,000/acre) (this includes several small parcels north and south of reservoir in Sect 34 = 3.61 acres) See map at right. Umbrella Agreement Execution 3 Retained West Access Easement on 150+/- acre parcel (30' width) (update upon construction completion)4,863 145,890 3.35 $5,024 Area x 50% FMV ($3,000/acre) End of Phase II 3 Retained River Access Easement on 22.5+/- acre parcel (100' width) (update upon completion of survey- channel and then 50' out from the banks) 2,636 263,600 6.05 $9,077 Area x 50% FMV ($3,000/acre) - Permanent easement for operations and maintenance (including data collection)End of Phase II 3 1987 Agreement Waiver of Potential Claims - Easement Under Para. 5 N/A N/A 291.00 $248,250 City owns approx. 291 acres in Section 34. The value of this is calculated as 291 ac x 50%FMV (for non-exclusive easement) x $3,000 per acre = $436,500. Reduced by 50% to account for shared rights with a total of four parties under 1987 agreement. Plus $30,000 in estimated legal fees. End of Phase II 3 1987 Agreement Waiver of Potential Claims - Water Lease Under Para. 6 $30,000 Estimated legal costs End of Phase II Misc. Property Information Binder $500 Reimbursement to LAPCR for background title property information Umbrella Agreement Execution Misc. Legal fees for mediation $1,000 Amount for legal fees to cover mediation preparation. Umbrella Agreement Execution $1,500 $378,761 Phase 1 Subtotal + Phase 3 Subtotal + Miscellaneous Subtotal Cash Due to LAPCR at Execution of Umbrella Agreement $71,411 $71,411 Cash Due to City at Execution of Umbrella Agreement N/A Cash Due to LAPCR at End of Phase 2 $292,351 Cash Due to City at End of Phase 2 $422,000 Net Due to City at End of Phase 2 $129,649 $228,250 Notes: - Estimated acreages only. Final acreage to be determined by survey. Amount to be paid upon execution of Umbrella Agreement Amount to be paid at end of Phase II Phase 1 Subtotal Umbrella Agreement - Supporting Documentation Updated 9/2/2021 Draft - for discussion purposes only LAPCR Fee Purchase of 121 acres of Section 34 lands south of Halligan Dam - Per acre values have been updated based upon recent (2020) appraisal reports received in the area. Values for encumbered properties have ranged between $1,700-$3,000/acre. Values for unencumbered properties have ranged between $2,800-$5,000/acre. $303,181Phase 3 Subtotal Miscellaneous Subtotal TOTAL VALUE OF CITY'S ACQUISITION = SUMMARY OF NET VALUES AND CASH DUE Cash due to City - Cash Due to LAPCR at End of Phase 2 Reserved River and Road Easements + 1987 Agreement Waivers Umbrella Agreement, Paragraph 11.1.1., amount for filling in placeholder dollar amount Umbrella Agreement, Paragraph 11.1.2., estimated amount for filling in placeholder amount $248,250 (1987 Agreement Waiver - Easement under paragraph 5) +$30,000 (1987 Agreement Waiver - Water Lease under Para. 6) -$50,000 (the "Lease") 150' River TAE + Purchase of 3.61 acres + Property info Binder + Legal fees for mediation Purchase of 121 acres + Permanent Non-Exclus Ag/Rec River & Shoreline Easements + Modification to 2017 Agreement ATTACHMENT 1 Page 2 LAPCR ACQUISITIONS Phase Area (Ac)*Value Value Assumptions Timing of Payment 3 Fee ownership of large parcel south of reservoir dam in S1/2 of Sec. 34 (Para. 6.1.1) subject to a restrictive covenant and two permanent access easements (road and river). 121 $363,000 Area x FMV ($3,000/acre) End of Phase II 3 Permanent Non-Exclusive Ag and recreation along river in City-retained portion of S1/2 of Sec. 34 (Para 6.1.2) 2.8 $4,200 Area x 50% FMV ($3,000/acre) roughly 820 linear feet x 150' width (estimated width of river + 50' out from each bank) End of Phase II 3 Permanent Non-Exclusive Ag and recreation on south reservoir shoreline west of reservoir dam in Secs. 33 & 34 (Para 6.1.3) 3.2 $4,800 Area x 50% FMV ($3,000/acre) End of Phase II 3 Modification to 2017 Agreement (aka "the Lease") $50,000 Under the 2017 Lease Para. 5, LAPCR agreed to annually pay the City $10,000 per year to lease the surface of Halligan Reservoir until construction of the dam begins. Under the Umbrella Agreement, LAPCR would not be required to make these annual payments and would still lease the surface of Halligan Reservoir through construction. For the purposes of quantifying the total value in this spreadsheet, we have assumed this would last for 5 years. ($10,000 x 5 years = $50,000.) This is thus a $50,000 value LAPCR is acquiring. End of Phase II $422,000 Sum of all items listed in the table above Umbrella Agreement - Supporting Documentation Updated 9/2/2021 Draft - for discussion purposes only LAPCR Fee Purchase of 121 acres of Section 34 lands south of Halligan Dam TOTAL VALUE OF LAPCR ACQUISITIONS = 4 stranded parcels owned by LAPCR. 3 acres 0.6 acres 0.01 acres (total) Halligan Water Supply Pro ject •04-19-22 Agreement between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project Theresa Connor, Utilities Deputy Director Ta wnya Ernst, Sr. Real Estate Specialist Eric Potyondy, Assistant City Attorney ATTACHMENT 2 Aerial Map of City and Landowners’ Association Lands 2 Landowners’ Association for Phantom Canyon Ranches Common Land City of Fort Collins Land ‘Small Association Parcels’ * Not to scale •Longstanding relationship between Landowners’ Association and City •Collaboration to meet City ’s access needs for various parts of the project. •Proposed exchange of property rights •Landowners’ Association to convey: •River Access Easement •Fee title to small parcels around dam •City to Convey: •Option to acquire fee title to 121 acres below dam (subject to restrictive covenants) •Shoreline and river easement •Modification of existing lease 3 Map of Proposed Property Rights Conveyances Around Halligan Reservoir 4 33 34 Small Association Parcels Landowners’Association Land City of Fort Collins Land Shoreline Access Easement Fee title (121+/-acres) Retained West Access Easement Reserved River Access Easement Rec. River Access Easement Map of Proposed Property Rights Conveyances Around the North Fork 5 Landowners’ Association Land River Access Easement 6 Questions? -1- ORDINANCE NO. 051, 2022 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CITY MANAGER AND THE MAYOR TO ENTER INTO AN AGREEMENT BETWEEN THE CITY OF FORT COLLINS AND THE LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES REGARDING THE HALLIGAN WATER SUPPLY PROJECT AND TO EXECUTE CERTAIN CONVEYANCE DOCUMENTS AND AN AGREEMENT ATTACHED THERETO WHEREAS, the City, through Fort Collins Utilities, is pursuing the Halligan Water Supply Project (“Project”), which includes: the enlargement of Halligan Reservoir, also known as North Poudre Reservoir No. 16 (“Reservoir”), which primarily entails replacing or enlarging the Reservoir’s dam; and the replacement of the diversion structure for the North Poudre Canal and related infrastructure (“Diversion Structure”) on the North Fork of the Cache la Poudre River (“North Fork”); and WHEREAS, the City owns certain real property in and around the Reservoir acquired for the Project; and WHEREAS, the Landowners’ Association for Phantom Canyon Ranches (“Association”) owns certain real property adjacent to the Reservoir, the Diversion Structure, and along the North Fork; and WHEREAS, the Association currently represents 43 members, all of whom have an ownership interest in separate and distinct parcels of land separate and apart from land the Association owns, but which such privately-owned land is in the vicinity of the Reservoir; and WHEREAS, the Association wishes to minimize the impacts from the Project to its members, Association land, and the environment; and WHEREAS, the City is and will be seeking various permits and approvals for the Project, and as part of the processes for those permits and approvals, the City will undertake various environmental mitigation and enhancement activities; and WHEREAS, the City also requires certain property rights related to the Project to access the Reservoir, the Diversion Structure, and the North Fork through land the Association owns; and WHEREAS, the City has contemplated the enlargement of Halligan Reservoir since the 1980s, and the City and the Association and its predecessors have previously had various agreements and understandings associated with the enlargement of Halligan Reservoir; and WHEREAS, in the past several years, City staff and the Association have worked collaboratively to discuss and work through relevant issues related to the Project and to negotiate the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom -2- Canyon Ranches, including its exhibits A-1, A-2, B, C, D-1, D-2, D-3, and E, a copy of which is attached as Exhibit “A” (the “Agreement”); and WHEREAS, the Agreement provides for certain conveyances of real property from the Association to the City and from the City to the Association; and WHEREAS, the resolution of the various items addressed in the Agreement will benefit the City and its residents and Fort Collins Utilities and its ratepayers, including by facilitating the acquisition of real property interests needed for the Project, facilitating the more timely permitting of the Project, and resolving outstanding disputes that would divert resources from the Project and other work that would be more beneficial to the City and its residents and Fort Collins Utilities and its ratepayers; WHEREAS, City staff anticipates needing to work with the Association further on subsequent phases of the Project, including Phase 2 (Construction) and Phase 3 (Operation and Maintenance), and desires that the Agreement is one step in an ongoing and mutually-beneficial relationship between the City and the Association and its members; and WHEREAS, the City Manager and City staff have recommended approval of the Agreement by the City Council. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That the City Council finds, pursuant to Section 23-111(a) of the City Code, that the disposition of the subject real property interests described in the Agreement pursuant to an agreement that is substantially similar to the attached Agreement is in the best interests of the City. Section 3. That the City Council finds, pursuant to Section 23-111(b) of the City Code, that the disposition of the subject real property interests described in the Agreement pursuant to an agreement that is substantially similar to the attached Agreement will not materially impair the viability of the water utility system as a whole and that it will be for the benefit of the citizens of the City. Section 4. That the City Council finds, pursuant to Section 23-114 of the City Code, that the disposition of the subject real property interests described in the Agreement pursu ant to an agreement that is substantially similar to the attached Agreement will result in the City receiving a value in an amount equal to or greater than the fair market value of such land. Section 5. That the City Council authorizes the City Manager to take the steps necessary to execute the Agreement in a form that is substantially similar to the Agreement, with such modifications and additional terms and conditions as the City Manager, in consultation with -3- the City Attorney, determines to be necessary and appropriate to protect the interests of the City or effectuate the purposes of this Resolution. Section 6. That the Mayor is hereby authorized to execute such documents of conveyance as are required to carry out the terms of the Agreement as set forth therein, upon the occurrence of the conditions for such conveyances as set forth in the Agreement. Section 7. That the City Council hereby authorizes the City Manager to execute a lease agreement substantially in the form of Exhibit E to the attach ed Agreement to grant the leasehold interest as described therein, in accordance with and upon the occurrence of the conditions for such lease agreement as set forth in the Agreement. Introduced, considered favorably on first reading, and ordered published this 19th day of April, A.D. 2022, and to be presented for final passage on the 3rd day of May, A.D. 2022. ____________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 3rd day of May, A.D. 2022. ____________________________ Mayor ATTEST: _______________________________ City Clerk Page 1 of 22 AGREEMENT BETWEEN THE CITY OF FORT COLLINS AND THE LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES REGARDING THE HALLIGAN WATER SUPPLY PROJECT This Agreement (the “Agreement”), dated this , is entered into by and between the City of Fort Collins, Colorado, a home-rule municipality (“City”), and the Landowners’ Association for Phantom Canyon Ranches, a Colorado non-profit corporation (“Association”). Each a “Party” and collectively the “Parties.” RECITALS A.The City, through Fort Collins Utilities, is pursuing the Halligan Water Supply Project (“Project”).0F 1 The Project includes1F 2: the enlargement of Halligan Reservoir, also known as North Poudre Reservoir No. 16 (“Reservoir”), which primarily entails replacing or enlarging the Reservoir’s dam (“Reservoir Dam”);2F 3 and the replacement of the diversion structure for the North Poudre Canal and related infrastructure (“Diversion Structure”)3F 4 on the North Fork of the Cache la Poudre River (“North Fork”). B.The Association owns certain real property adjacent to the Reservoir, the Diversion Structure, and along the North Fork, the approximate locations of which are shown on Exhibit A- 1 attached hereto and incorporated herein (the “Association Land”). The Association Land includes the Small Association Parcels (as such term is defined in Paragraph 7.1.1). C.The City also owns certain real property in and around the Reservoir acquired pursuant to: the (1) Warranty Deed, dated January 22, 2004, recorded with the Larimer County Clerk and Recorder at Reception No. 2004-0077821; and the (2) Bargain and Sale Deed, dated January 22, 2004, recorded with the Larimer County Clerk and Recorder at Reception No. 2004-0077822 (collectively, the “City Land”). For illustrative purposes only, the approximate locations of the Reservoir, the Diversion Structure, the City Land, and the Association Land nearby are shown on Exhibit A-1 attached hereto and incorporated herein. D.The City is and will be seeking various permits and approvals for the Project. As part of the processes for those permits and approvals, the City may undertake various environmental mitigation and enhancement activities. The City also requires certain property rights related to the 1 In the federal permitting process for the Project, the enlargement of Halligan Reservoir and the related items noted above that are the subject of this Agreement are part of the City’s Proposed Action. For the purposes of this Agreement, none of the other alternatives analyzed in the federal permitting process are part of the Project. 2 In this Agreement, “include” signifies a list that is not necessarily exhaustive. E.g., Lyman v. Town of Bow Mar, 188 Colo. 216, 222, 533 P.2d 1129, 1133 (1975). 3 The Reservoir is an on-channel reservoir located on the North Fork, in portions of Sections 29, 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M. The enlarged Reservoir will also extend into portions of Sections 27 and 28, Township 11 North, Range 71 West of the 6th P.M. The Reservoir Dam (for the current Reservoir and the enlargement) is located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. 4 The Diversion Structure is located in the North Fork in the SE1/4 of Section 12, Township 10 North, Range 71 West of the 6th P.M. EXHIBIT A Page 2 of 22 Project to access the Reservoir, the Diversion Structure, and the North Fork through Association Land. E. The Association currently represents forty-three (43) members (the “Members”) all of whom have an ownership interest in separate and distinct parcels of land separate and apart from the Association Land, but which such privately owned land is in the vicinity of the Reservoir. The Association and its Members have historically shown a commitment to the preservation of land in and around the Reservoir. For instance, many of the lands owned by the Association and its Members are subject to conservation easements, and the Association has historically cared for the Reservoir and preserved and enhanced the habitat of the surrounding lands owned by the Association. The Association wishes to minimize the impacts from the Project to its Members, Association Land, and the environment. F. The City has contemplated the enlargement of Halligan Reservoir since the 1980s. The City and the Association and its predecessors have previously had various agreements and understandings associated with the enlargement of Halligan Reservoir. The City’s intent with this Agreement includes honoring the spirt of those previous agreements and understandings in the context of the current Project. G. The City and the Association have negotiated this Agreement to address certain requirements of the City and certain concerns of the Association. This Agreement contains mutual promises and consideration between the Parties. As set forth herein, the City and the Association anticipate that subsequent agreements regarding the Project will be negotiated and completed, but that neither Party is obligated to negotiate or enter into any subsequent agreements. As set forth herein, to the greatest extent reasonably practicable as determined by the City, the City shall not seek to acquire Association Land by condemnation or otherwise, beyond that which is expressly referenced in this Agreement. Maps showing the lands that are the subject of the various conveyances contemplated in this Agreement are attached as Exhibit A-2. H. The Parties further acknowledge and recognize the disparate bargaining power between the City and the Association inasmuch as the City may acquire the Association Land, and any other rights it may require, by eminent domain, whereas any remedy available to the Association may be greatly limited in scope and availability. Therefore, the Parties desire to set forth the terms and conditions of this Agreement in such a manner that seeks to put the Parties in substantially the same bargaining position, which includes the obligation of the City to negotiate and deal with the Association in good faith, because the City has not waived, and will not waive under this Agreement, the City’s powers related to eminent domain. AGREEMENT 1. INCORPORATION OF RECITALS. The foregoing recitals are hereby incorporated as if fully restated in their entirety. 2. GOOD FAITH AND APPROVAL. EXHIBIT A Page 3 of 22 2.1 The Parties agree to act in good faith in their work pursuant to this Agreement and any future agreement contemplated in this Agreement. 2.2 The City acknowledges that in order for the Association to execute any agreement that is not specifically contemplated in this Agreement, but for which this Agreement obligates the Parties to negotiate as required for the Project, the Association must obtain the approval of its Board of Directors in accordance with the requirements of the Association’s controlling documents, including its bylaws and the Declaration of Covenants, Conditions and Restrictions for Phantom Canyon Ranches encumbering the Association Land, and/or applicable law. 2.3 The Association acknowledges that in order for the City to execute any agreement that is not specifically contemplated in this Agreement, but for which this Agreement obligates the Parties to negotiate as required for the Project, the City may need to obtain approval from City Council pursuant to City Code and other applicable law. 3. OVERVIEW. The Project is generally proceeding in three conceptual phases: Phase 1 (Permitting and Design); Phase 2 (Construction); and Phase 3 (Operation and Maintenance). This Agreement is thus organized accordingly. 4. PHASE 1 (PERMITTING AND DESIGN). Phase 1 generally concerns the City seeking the necessary information, permits, and approvals to construct the Project. Phase 1 generally includes site visits and data collection related to permitting processes and preliminary design work for the enlargement of the Reservoir and for the replacement of the Diversion Structure. 4.1. Existing City Access Rights. The following is a brief identification of existing access rights the City has acquired from the Association. Except as set forth in Paragraph 8, nothing in this Agreement modifies these existing access rights. 4.1.1. Under the Lease Agreement Between the City of Fort Collins and the Landowners Association for Phantom Canyon Ranches for Halligan Reservoir and Adjacent Properties, dated March 9, 2017 (“2017 Lease”), the City has the right to use Meadow Creek Road pursuant to Paragraph 4.c of said 2017 Lease. 4.1.2. Under the Temporary Access Easement Deed With Terms and Conditions (Phase 1 (Permitting and Design) of the Halligan Water Supply Project (Halligan Reservoir and Dam)), dated May 26, 2020 (“Reservoir TAE”) the Association granted the City a temporary access easement over Meadow Creek Road, Three Corner Gate Road, and Halligan Meadows Road for Phase 1. The Reservoir TAE was recorded with the Larimer County Clerk and Recorder on June 23, 2020 at Reception No. 20200045062. EXHIBIT A Page 4 of 22 4.1.3. Under the Temporary Access Easement Deed With Terms and Conditions (Phase 1 (Permitting and Design) of the Halligan Water Supply Project (North Poudre Canal Diversion Structure)), dated August 6, 2020 (“Diversion TAE”), the City has certain rights to use a portion of the Association Land at the diversion structure for the North Poudre Canal for Phase 1, subject to those conservation rights held by The Nature Conservancy (“TNC”) pursuant to that certain Deed of Conservation Easement dated December 22, 1987 and recorded at Reception No. 87072156 in the real property records of Larimer County (“TNC Easement”). The Parties acknowledge that TNC has reviewed and consented to the Association granting the Diversion TAE to the City. The Diversion TAE was recorded with the Larimer County Clerk and Recorder on August 26, 2020 at Reception No. 20200067488. 4.2. Temporary Access Easement Granted to the City. The Association hereby agrees to grant to the City the temporary access easement identified in Paragraph 4.2.1 (“Phase 1 River Access Easement”). The land underlying the Phase 1 River Access Easement is subject to a conservation easement held by TNC. The City has worked extensively with TNC representatives, which have indicated that the Phase 1 River Access Easement is acceptable to TNC. Nevertheless, if TNC objects to or proposes revisions to the Phase 1 River Access Easement, the Association may in its reasonable discretion object to such TNC proposed revisions and thereafter the Parties shall use commercially reasonable efforts to agree upon the form of the Phase 1 River Access Easement to be recorded that is acceptable to the City, TNC, and the Association. The conveyance of the Phase 1 River Access Easement shall be completed as soon as practicable following the executing of this Agreement. 4.2.1. Phase 1 River Access Easement. The form of the Phase 1 River Access Easement to be granted by the Association to the City is attached as Exhibit B. 4.2.2. Recording. The City shall record a fully executed copy of the Phase 1 River Access Easement with the Larimer County Clerk and Recorder at the City’s cost. 4.3. Potential Need for Additional City Access. The City has sought to identify all of its needs for Phase 1 access through the rights granted in the 2017 Lease, Reservoir TAE, Diversion TAE, and the Phase 1 River Access Easement (collectively, “Phase 1 Easements”). The Parties nevertheless acknowledge that, in the course of the permitting and approval processes for the Project, unanticipated challenges and issues may arise such that the City may need some additional temporary access to Association Land that is outside of the scope of the Phase 1 Easements. If such a need arises, the City will first look to reasonable alternative access that does not affect Association Land. If no such reasonable alternative exists, the Parties agree to negotiate, in good faith, separate and distinct licenses to EXHIBIT A Page 5 of 22 enter and/or easement(s) apart from the Phase 1 Easements described herein, to address such needs and any related issues, which such agreement or easement shall include customary representations and warranties from both Parties. Any future temporary access easements or other agreements that will encumber Association Land, shall be surveyed, if the Association deems it necessary, at the City’s cost, in accordance with Paragraph 7.4.1. 4.4. Right to Terminate During Phase 1. The Parties acknowledge that the permitting and approval processes for the Project include some level of uncertainty regarding the ultimate ability of the City to enlarge the Reservoir and replace the Diversion Structure. If the City abandons the enlargement of the Reservoir, the City may terminate this Agreement by providing written notice to the Association pursuant to Paragraph 11.8. In such event, the City would be obligated to: (a) file with the Larimer County Clerk and Recorder (1) a notice of abandonment of the Phase 1 Easements, except the 2017 Lease, and (2) a notice of termination of this Agreement, including the options described in Paragraph 7; and (b) if the City has acquired the Small Association Parcels as described in Paragraph 7.1.1, the City shall convey such land back to the Association by quitclaim deed. Any termination of the 2017 Lease would be completed pursuant to its terms. 5. PHASE 2 (CONSTRUCTION). Phase 2 generally concerns the construction work related to the enlargement of the Reservoir and the replacement of the Diversion Structure. 5.1. Coordination Regarding Construction. The City, in its sole discretion, intends to begin construction under Phase 2 once it has received all required permits and approvals for the Project and after the time to appeal such permits and approvals has expired. The City agrees to regularly update the Association on the status of these permitting and approval processes via monthly written correspondence, which may be by email. 5.2. Inundation. With respect to the Reservoir adjacent to Association Land, the City currently owns in fee the land that is currently inundated and that will be inundated below the ordinary high water mark of the Reservoir as the City plans to enlarge it. However, the Colorado Division of Water Resources now requires reservoir owners to own in fee or have easements for lands that would be inundated by the inflow design flood surcharge, which will be above the ordinary high water mark of the enlarged Reservoir. Rule 7.9.3.3, 2 CCR 402-1, Rules and Regulations for Dam Safety and Construction. There is currently some uncertainty about the exact extent of the inflow design flood surcharge for purposes of these regulations. The Parties nevertheless acknowledge that the City may require easements from the Association related to the inflow design flood surcharge due to this and related regulations. EXHIBIT A Page 6 of 22 5.3. Power Lines Near the Reservoir. The Parties acknowledge that certain power lines are located south of the current high water line of the Reservoir in Section 33, Township 11 North, Range 71 West of the 6th P.M., and that upon the enlargement of the Reservoir, these power lines may be located close to or be inundated by the Reservoir, and consequently may need to be relocated in coordination with their owner, the Poudre Valley Rural Electric Association, Inc. (“PVREA”). The City and the Association agree to negotiate in good faith to define a plan for the relocation of portions of the power lines that are deemed compromised by the Reservoir enlargement in a way that minimizes impacts to the Association and the Members to the greatest extent practical while ensuring that the City will be able to complete the Project in a timely and cost-effective manner. Any agreement or other document that is to be executed by either of the Parties in connection with the relocation of the power lines must include the consent and approval of the PVREA as a condition to such execution. 5.4. Subsequent Negotiations for Temporary Construction Easements to the City and Related Matters. The Parties acknowledge that the City will require temporary construction easements across the Association Land. However, as the design work continues, there are some uncertainties regarding the precise extent and scope of such easements. Therefore, and in consideration of the foregoing, the City and the Association agree to negotiate in good faith to define the extent and scope of such temporary construction easements in a way that reduces impacts to the Association and the Members to the greatest extent reasonably practicable while ensuring that the City will be able to complete the Project in a timely and cost- effective manner. The negotiation will also ensure that the easements eventually acquired by the City are no greater than what the City needs to complete the Project in a timely and cost-effective manner.4F 5 Any future temporary construction easements or other future agreements or plans contemplated under this Section 5.4 shall include customary representations and warranties from both Parties. Any future temporary construction easements or other agreements that will encumber Association Land, shall be surveyed at the City’s cost, if the Association deems it necessary, in accordance with Paragraph 7.4.1. 6. PHASE 3 (OPERATION AND MAINTENANCE). Phase 3 generally begins following the completion of construction and concerns the City operating and maintaining the Reservoir Dam and Reservoir. This Phase 3 will likely also include the permanent maintenance of some measuring devices on the Reservoir, North Fork, and Diversion Structure to satisfy environmental monitoring requirements under the governmental permits and approvals. Phase 3 will require that the City have access to the Reservoir and the North Fork (the “Phase 3 Access”) through permanent access easements across Association Land. 6.1. Phase 3 Access Issues. The negotiation of any future Phase 3 Access easement or agreement contemplated under this Paragraph 6 shall consider in good faith the needs and desires of the Parties and may include the consideration of reasonable limits on City access. 5 Nothing in this Agreement shall be deemed as a waiver of the City’s powers related to eminent domain. E.g., Wheat Ridge Urban Renewal Authority v. Cornerstone Group XII, LLC, 176 P.3d 737, 742 (2007). EXHIBIT A Page 7 of 22 Any Phase 3 Access easement or other agreement that will encumber Association Land, shall include customary representations and warranties from both Parties and be surveyed, at the City’s cost, in accordance with Paragraph 7.4.1. 6.2. Coordination Regarding the Completion of Construction. The City intends to complete construction in a timely and expedient manner. The City agrees to update the Association on the status of construction no less frequently than monthly in writing, which may be by email. 6.3. Subsequent Negotiations for Permanent Access Easements to the City and Related Matters. As the design work continues and as the operational and maintenance requirements become clearer as governmental permits and approvals are acquired, there are some uncertainties regarding the precise extent and scope of any Phase 3 Access needs. When considering Phase 3 access, the City will first look to reasonable alternative access that does not affect Association Land. If no such reasonable alternatives exist (such as, by way of example only, if a governmental permit or approval requires water sampling on Association Land), the City and the Association agree to negotiate in good faith to define the extent, scope, terms and obligations of the Phase 3 Access to (1) reduce impacts to the Association and its Members to the greatest extent reasonably practicable while still allowing the City to complete the Project in a timely and cost-effective manner, and (2) ensure that the easements eventually acquired by the City are no greater than what the City reasonably requires to operate and maintain the Project in a timely and cost-effective manner. 7. OPTIONS GRANTED TO THE CITY AND THE ASSOCIATION. In exchange for the mutual promises contained in this Agreement and other good and valuable consideration, the receipt and adequacy of which the City hereby acknowledges, the Association hereby grants the City and the City hereby grants the Association certain options pursuant to the terms and conditions of this Agreement. 7.1. Option Granted to the City. For and in consideration for the City’s execution and delivery of this Agreement, the Association hereby grants to the City the options to acquire the following described property rights from the Association as described in Paragraph 7.1.1. Following the execution of this Agreement, the City shall be entitled to contact the Association to exercise this option (“Fee Option Exercise”) and to schedule a closing (the “Fee Closing”) within sixty-three (63) days of such notice to the Association that is mutually agreeable to the City and the Association. At the Fee Closing, no additional monetary payment will be required because it has been included in the payments set forth in Paragraph 11.1.1. 7.1.1. Fee Title to the Small Association Parcels, Located North and South of the Reservoir (in the N1/2 of Section 34). The Association hereby agrees to grant the City fee title to all of the LAPCR lands in the NW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M., being approximately 3.61 acres (the EXHIBIT A Page 8 of 22 “Small Association Parcels”). The Association would convey the portion of the Small Association Parcels located north of the Reservoir subject to a restrictive covenant precluding future development. The portion of the Small Association Parcels located south of the Reservoir would not be subject to any restrictive covenant as they will be impacted by the new Reservoir Dam and its construction. The form of the conveyance documents for the Small Association Parcels are attached hereto as Exhibit C. 7.2. Options Granted to the Association. For and in consideration for the Association’s execution and delivery of this Agreement, the City hereby grants to the Association three options to acquire the following described property rights from the City as described in Paragraphs 7.2.1, 7.2.2, and 7.2.3. As soon as the Colorado Division of Water Resources has accepted construction of the new Reservoir Dam pursuant to its Rules and Regulations for Dam Safety and Dam Construction, 2 CCR 402-1 (or successor regulations) (“Reservoir Dam Acceptance”), but no later than fourteen (14) days5F 6 after the City has received written notice of the Reservoir Dam Acceptance, the City shall deliver written notice to the Association and contact the Association to schedule a closing (the “Option Closing”) within sixty-three (63) days of such notice to the Association that is mutually agreeable to the City and the Association. At the Option Closing, monetary payment shall be due as set forth in Paragraph 11.1.2. The Association may then exercise all or any one of the following three (3) options at any time prior to the Option Closing (each an “Option” and collectively the “Options”). The Association acknowledges that the land that is subject to the Options will be impacted to some degree by City activities during Phase 1 (Permitting and Design) and will be impacted by City activities during Phase 2 (Construction), including through the widening of roads. Except as otherwise expressly stated in this Agreement, the Association will acquire such land under the Options as it exists at the time of conveyance. 7.2.1. Fee Title to a Portion of Certain City-Owned Land South of the Reservoir Dam (in the S1/2 of Section 34). The City would convey to the Association fee title to up to 121 acres of the land that the City owns south of the Reservoir in the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M., being all or part of the approximately 121 acres identified on Exhibit A- 2 (the “Subject 121 Acres”), with the City reserving to itself: (a) a non-exclusive access easement across the Fee Parcel from the west (the “West Access Easement”), and (b) a non-exclusive access easement along the North Fork (the “North Fork Access Easement”). The entirety or portion of the Subject 121 Acres to be conveyed to the Association is referred to as the “Fee Parcel.” The City would convey the land subject to a restrictive covenant precluding future development and certain types of grazing activities and would retain ownership of the remainder of its land in Section 34. The proposed conveyance documents for the Fee Parcel are attached as Exhibit D-1. 6 All days in this Agreement are calendar days – as opposed to business days – unless stated otherwise. EXHIBIT A Page 9 of 22 7.2.1.1. The price for the Fee Parcel, to be due as set forth in Paragraph 11.1.2, shall be calculated as: the product of $3,000 per acre multiplied by the area of the Fee Parcel (with the area being determined by the survey to be completed pursuant to Paragraph 7.4); less the monetary value the City is retaining in the Fee Parcel, which shall be calculated as the product of $3,000 per acre multiplied by 0.5 multiplied by the sum of the areas of the West Access Easement and the North Fork Easement (with the areas being determined by the surveys to be completed pursuant to Paragraph 7.4). For the sole purpose of determining the area of the North Fork Easement to calculate the price under this paragraph, the “high water line along each of its banks” referenced in the North Fork Easement shall be assumed to be the top of bank. 7.2.2. Easement for the Association to Access Certain City-Owned Land South of the Reservoir Dam (in the SW1/4 of Section 34) Along the North Fork. The City would convey to the Association a perpetual easement for recreation to access certain land that the City owns along the North Fork south of the Reservoir in the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M (the “River Access Easement”). These rights to access the subject land for recreation under the River Access Easement are exclusive only in the sense that the City shall not use the subject land for recreation or recreational access and shall not grant recreational rights or recreational access to others on the same land. The City shall otherwise retain the right to access and use the subject land for any purpose that does not violate the Association’s rights under the River Access Easement. The proposed conveyance documents for the River Access Easement are attached as Exhibit D-2, which includes: a general description of the land to be subject to the easement, and terms and conditions that may limit the Association, and the Members’ use of the land to be subject to the easement. Prior to the Option Closing, the City will legally define the “Maintenance and Operation Zone” identified in Paragraph 5 of the attached form of conveyance to meet applicable legal requirements and the City’s needs associated with the Project.6F 7 7.2.2.1. The price for the River Access Easement, to be due as set forth in Paragraph 11.1.2, shall be calculated as the product of $3,000 per acre multiplied by 0.5 multiplied by the area of the River Access Easement (with the area being determined by the survey to be completed pursuant to Paragraph 7.4). For the sole purpose of determining the area of the River Access Easement to calculate the price under this paragraph, the “high water 7 For reference and clarification purposes only, the Parties acknowledge a conflict between the description of the City Land (as described in the deeds identified in Recital B) and the description of land owned by the Association in its various deeds. Specifically, the City owns fee title to certain lands in Sections 33 and 34, Township 11 North, Range 71 West of the 6th P.M. lying below the 110-foot contour line of Halligan Reservoir. However, some of the Association’s deeds inaccurately indicate that the Association owns fee title to certain lands in these sections to the historical high-water line of Halligan Reservoir, which is approximately the 70-foot contour of Halligan Reservoir. The Parties agree that the City owns fee title to such land and is thus able to grant an easement on such land. EXHIBIT A Page 10 of 22 line along each of its banks” referenced in the River Access Easement shall be assumed to be the top of bank. 7.2.3. Easement for the Association to Access City-Owned Land Along the Reservoir’s Shore West of the Reservoir Dam (in Section 33 and in the S1/2 of Section 34). The City would convey to the Association a perpetual easement for recreation and livestock grazing (excluding domesticated sheep and/or goats) to access certain land that the City owns along the Reservoir’s shore west of the Reservoir Dam in Section 33 and in the S1/2 of Section 34, Township 11 North, Range 71 West of the 6th P.M. (the “Shoreline Easement”). These rights to access the subject land for recreation under the Shoreline Easement are exclusive only in the sense that the City shall not use the subject land for recreation, recreational access, or livestock grazing and shall not grant recreational rights, recreational access, or livestock grazing rights to others on the same land. The City shall otherwise retain the right to access and use the subject land for any purpose that does not violate the Association’s rights under the Shoreline Easement, as set forth in greater detail in the attached draft Shoreline Easement. The proposed conveyance documents for the Shoreline Easement are attached hereto as Exhibit D-3, which includes: a general description of the land to be subject to the Shoreline Easement, and terms and conditions that may limit the use of the land by the Association and its Members. Prior to the Option Closing, the City will legally define the “Maintenance and Operation Zone” identified in Paragraph 5 of the attached form of conveyance to meet applicable legal requirements and the City’s needs associated with the Project. 7.2.3.1. The price for the Shoreline Easement, to be due as set forth in Paragraph 11.1.2, shall be calculated as the product of $3,000 per acre multiplied by 0.5 multiplied by the area of the Shoreline Easement (with the area being determined by the survey to be completed pursuant to Paragraph 7.4). 7.3. Section 1031; Section 1033. 7.3.1 The Association may desire to exchange the Fee Parcel and the Small Association Parcels in a tax deferred transaction under Section 1031 of the Internal Revenue Code. Upon the Association’s exercise of its Option under Paragraph 7.1.1, it shall also deliver to the City the Association’s election as to whether it desires to exchange the Small Association Parcels for the Fee Parcel in a Section 1031 exchange. Thereafter, the City agrees to cooperate with the Association in good faith in the execution of any documents necessary to effect such transaction under Section 1031 of the Internal Revenue Code. The City takes no position regarding whether the Association is entitled to exchange the Fee Parcel and the Small Association Parcels in a tax deferred transaction under Section 1031 of the Internal Revenue Code and the Association agrees to indemnify the City for its cooperation with any such transaction. EXHIBIT A Page 11 of 22 7.3.2 The Association expressly acknowledges that it is aware that under Colorado law, the City is empowered with the right of eminent domain and that, in the event City fails to acquire the requisite property rights from the Association for the Project, the City may have the authority to acquire such property rights by exercising its power of eminent domain. The Association further acknowledges that had the Parties not entered into this Agreement and the City sought to acquire such property rights using its eminent domain authority, the Association would have had the right to require the City to acquire such property rights by complying with the laws of the State of Colorado regarding eminent domain. The City, upon the reasonable request of the Association, agrees to provide a written statement that this Agreement is entered into under the threat or imminence of condemnation. It is the Association’s position that any closing under this Agreement qualifies for income tax treatment under Internal Revenue Code Section 1033(g). 7.4. Surveys. The specific lands that are the subject of the options described in this Paragraph 7 have been described in general terms but have not yet been surveyed. Following the execution of this Agreement, the City agrees to complete the surveys contemplated under this Agreement as soon as practicable. Consequently, the acreages above are estimates derived from readily available maps and actual acreages may vary from what is stated above. 7.4.1. The Parties agree that, prior to executing any conveyances under this Agreement, the City, at its expense, shall obtain surveys of any such lands in order to produce accurate legal descriptions for the conveyances. For the conveyances of title in fee, ALTA Surveys (or such other survey as the Parties’ respective title insurance companies may require) shall be used. The City shall also be responsible for obtaining any necessary third-party approvals required to complete such surveys. The Association agrees to reasonably cooperate with and provide the City with access to complete such surveys and to not charge the City for any access necessary for such surveys. 7.4.2. The following are additional statements of intent to provide clarity regarding the Parties’ intended use of the lands to be conveyed. With this conveyance, it is intended: • That the Small Association Parcels identified in Paragraph 7.1.1 constitute all of the land the Association owns in the N1/2 of Section 34; • That the Fee Parcel shall be a single, contiguous parcel spanning from the west section line of Section 34 to the east line of the SW1/4 of Section 34, and beginning from the south section line of Section 34; • That the West Access Easement identified in Paragraph 7.2.1 be limited to maintenance, operations, repairs, and other activities that need to be performed by the City on the Reservoir, Dam, or City-owned lands, including various activities under different permits and approvals, and EXHIBIT A Page 12 of 22 for emergency purposes associated with the Project The West Access Easement will be across permanent roads, including turnouts, that remain in place after construction of the Project is complete, and which roads are accessed from the Association’s Halligan Meadows Road. This easement shall not give the City any right to use the Association’s Halligan Meadows Road or other Association roads, and which rights would need to be acquired separately; • That the North Fork Access Easement identified in Paragraph 7.2.1 be solely for pedestrian access and limited to purposes related to environmental, fish, water quality, and related monitoring and compliance activities associated with permits and approvals for the Project, subject to various terms and conditions in Exhibit D-1; and • That the City retains ownership of: the land where the existing U.S. Geological Survey stream gage (06751150) on the North Fork below the Reservoir Dam is located, the land where the existing dirt road down to the North Fork is located; and the land where any infrastructure associated with the enlarged Reservoir (e.g., Dam, spillway, stilling basin, control house, bridge over the North Fork, etc.) is located. 7.5. Title Insurance/Evidence of Title. 7.5.1. Within fourteen (14) days of the Fee Option Exercise or the Reservoir Dam Acceptance, as applicable, the City will provide to the Association title insurance commitments, together with copies of all documents of record related to exceptions identified in the title commitments (together, “Title Commitments”) from Land Title Guarantee Company (or another reputable title insurance company authorized to conduct business in Colorado and that is reasonably acceptable to the Association) (“Title Company”). The Title Commitments must show title to the lands identified in Paragraphs 7.2.1, 7.2.2, and 7.2.3, as being vested in the City, and title to the lands identified in Paragraph 7.1.1 being vested in the Association, subject only to those exceptions set forth on Schedule B-2 to the Title Commitments. The City is responsible for the cost of the Title Commitments and Title Insurance and any required endorsements requested by the Association. 7.5.2. If the Title Commitments disclose title defects unsatisfactory to the City or the Association as the grantee in such conveyance (“Purchasing Party”), that the Purchasing Party desires to be corrected or cured, the Purchasing Party may give the other Party as the grantor in such conveyance (“Selling Party”) written notice of such defects within fourteen (14) days after receipt of the Title Commitments. The Selling Party will make its best efforts to address the alleged defects, but shall not be obligated to expend an amount greater than Seven Thousand Dollars ($7,000.00) in the aggregate (including any out-of-pocket expenses for title endorsements, releases, and reasonable attorneys’ fees, etc.). The Selling Party shall have fourteen (14) days after its receipt of notice of the defect, to give the EXHIBIT A Page 13 of 22 Purchasing Party notice of whether or not the Selling Party intends to correct or cure such defect. Unless the Selling Party, in its sole and absolute discretion (subject to its good faith effort capped as set forth above), elects to cure such defect, the Selling Party shall have no obligation to do so. If the Selling Party elects to cure any such defect, then Selling Party must use its best efforts to cure such defects prior to the Fee Closing or the Option Closing, as applicable, at its expense (subject to the cap set forth above), without in any other manner adversely affecting the terms of this Agreement. In the event that a Selling Party elects to cure a defect and is unable to do so prior to the Fee Closing or the Option Closing, as applicable, then the Purchasing Party, at its election, may delay the Fee Closing or the Option Closing, as applicable, for a reasonable period of time in which to give the Selling Party time to cure such defect, but in no event shall the Fee Closing or the Option Closing, as applicable, be delayed for more than twenty-eight (28) days. 7.5.3. If the Selling Party elects not to cure any such defect, the Title Company refuses to omit, or provide a title insurance endorsement over any title defect or objection prior to the Fee Closing or the Option Closing, as applicable, or if the Selling Party, despite its best efforts capped as set forth above, is unable to cure such defects that the Purchasing Party has provided written objection to (excluding any permitted exceptions) then the Purchasing Party, at its election, has the right to: (1) accept such title as the Selling Party is able to convey; or (2) rescind Paragraph 7 of this Agreement in its entirety. 7.5.4. Notwithstanding the foregoing: (1) any title condition consisting of monetary liens, deeds of trust, or other financial encumbrances against the subject property caused by, through or under the Selling Party, must be removed by the Selling Party at or prior to the Fee Closing or the Option Closing, as applicable, and the Selling Party’s failure to cause the removal of the same will constitute a default by the Selling Party under this Agreement; and (2) in the event the Association fails to cause the removal of a financial encumbrance against the subject property prior to the Fee Closing or the Option Closing, as applicable, as required above, the City has the right to pay amounts required to do so at the Fee Closing or the Option Closing, as applicable, and receive a credit for such payment against any other amounts due under this Agreement or any other agreements between the Parties referenced in this Agreement. 7.6. Maintenance of the Property/Title. The City and the Association, respectively, must not cause or permit new liens, easements, or other encumbrances on the title to the EXHIBIT A Page 14 of 22 lands that are the subject of this Paragraph 7 (“Subject Lands”), except as expressly agreed by the other Party in writing. 7.7. Representations of the Grantors. The City and the Association, respectively, as the Selling Party with respect to the Subject Lands they own, represent and warrant as of the date of this Agreement, to the best of the actual knowledge of their respective officers without duty of investigation or inquiry, as follows: 7.7.1. Except for the understanding that the Fort Collins City Council can authorize the use eminent domain to acquire from the Association property rights as described in this Agreement, and except for any matters in association with Fort Collins City Council Resolution No. 013, 2020, they have not received any written notice of any litigation proceeding, including but not limited to any eminent domain proceeding, pending or notice of threatened litigation against or relating to any part of the Subject Lands. 7.7.2. They have not received written notice of any violations of any laws, orders, regulations, or requirements of any governmental authority affecting the Subject Lands. 7.7.3. The Parties have the right and power to execute and deliver this Agreement and to consummate the conveyances contemplated in this Agreement. 7.7.4. Except as may be contained on a survey to be completed, they have not received written notice of violation of any of the covenants, conditions, restrictions, rights-of-way, or easements affecting the Subject Lands. Upon the Fee Closing or the Option Closing, as applicable, and to the extent that the information comprising the representations and warranties contained in this Paragraph 7.7 are still true in all respects, the Parties shall repeat these representations and warranties in the final closing documents contemplated in Paragraph 7.11. 7.8. Inspection. 7.8.1. At any time after the Fee Option Exercise or the Reservoir Dam Acceptance, as applicable, and prior to the Fee Closing or the Option Closing, as applicable, the City and the Association have the right to make reasonable inspections of the physical condition of the Subject Lands. These inspections may include, but are not limited to, environmental assessments and inspections regarding compliance with any building or fire code, environmental protection, pollution or land use or zoning laws, rules or regulations, including, any laws relating to the disposal or existence of any hazardous substance or other regulated substance in or on the Subject Lands. If the Purchasing Party does not provide to the Selling Party written notice of any unsatisfactory condition, as determined at the Purchasing Party’s sole discretion, signed by an authorized representative of the Purchasing Party, within twenty-eight (28) days prior to the Fee Closing or the Option Closing, as applicable, EXHIBIT A Page 15 of 22 the Purchasing Party waives any objection to the physical condition of the Subject Lands as of that date. If the Purchasing Party does timely provide the Selling Party written notice of any unsatisfactory condition and the Selling Party elects to cure the unsatisfactory condition, the Purchasing Party may postpone the Fee Closing or the Option Closing, as applicable, for a reasonable period of time, but not to exceed twenty-eight (28) days, while the Selling Party cures the condition. If the Selling Party elects not to cure the condition, the Purchasing Party may terminate this Agreement, or accept the Subject Lands, subject to such unsatisfactory condition. The Purchasing Party is responsible and will pay for any damage that occurs to the Subject Lands and the improvements located thereon as a result of these inspections. 7.8.2. Each Party hereby authorizes the other Party, and its engineer and/or other experts or agents, to enter upon the Subject Lands at any reasonable time for the purpose of making such inspections. The Purchasing Party shall notify Selling Party prior to any entry onto the Subject Lands pursuant to this Agreement. The Purchasing Party is solely responsible for any expenses, costs (including court costs and reasonable attorneys’ fees), liens and claims incurred by the Purchasing Party and arising out of any such tests, inspections and activities, and the Purchasing Party releases the Selling Party from any claims or demands for injury or property damage incurred by the Purchasing Party as a result of the Purchasing Party’s due diligence activities on the Subject Lands. The Purchasing Party will, and will cause any consultant to, take all reasonable precautions to avoid any damage to the Subject Lands from the inspection activities of its employees, contractors, and equipment. Any damage to the Subject Lands or any portion thereof resulting from the activities of Purchasing Party or its agents or contractors, whether or not caused by negligence, will be promptly restored by the Purchasing Party at its expense. To the extent permitted by law, each Party shall indemnify, protect and hold each other harmless from and against any and all liens, claims, causes of action, demands, obligations, losses, damages, liabilities, judgements and costs (including court costs and reasonable attorney’s fees) in connection with its tests, inspections and activities on the Subject Lands. 7.9. Possession. The Parties will deliver possession of the Subject Lands at the Fee Closing or the Option Closing, as applicable, pursuant to the conveyances described above, and for the Option Closing subject to the West Access Easement, North Fork Access Easement, and for both the Fee Closing and the Option Closing to those permitted exceptions set forth on Schedule B-2 to the Title Commitments. 7.10. Proration. Real property taxes and assessments and similar expenses, in accordance with local practice, will be prorated as of the date of the Fee Closing or the Option Closing, as applicable, based on the most recent valuation and mill levy available to the Title Company, which proration shall be a final settlement of such real property taxes and assessments and similar expenses. EXHIBIT A Page 16 of 22 7.11. Final Closing Documents. The City agrees to prepare, in coordination with the Title Company, final draft closing documents for the Association’s review. The City and the Association shall work in good faith to finalize the closing documents pursuant to this Agreement and its intent. 7.12. Recording. The City shall record fully executed copies of the conveyances identified in Paragraphs 7.1 and 7.2 with the Larimer County Clerk and Recorder at the City’s cost. 8. MODIFICATIONS TO THE 2017 LEASE. The Parties agree to the following modifications to the 2017 Lease terms (the “Lease Amendments”). The Lease Amendments are incorporated into the amended and restated version of the 2017 Lease attached as Exhibit E (Amended and Restated 2017 Lease). The Amended and Restated 2017 Lease shall be executed by both Parties no later than sixty-three (63) days after the mutual execution of this Agreement. 8.1. Term. The Parties desire to extend the initial Term of the 2017 Lease through Phase 2 (Construction) subject to reasonable limitations on the Association’s use of the Property (as defined in the 2017 Lease) to allow the City to complete construction and for health and safety reasons. The Association’s right to extend the term of the Lease pursuant to Paragraph 5 of the Lease remains unchanged. 8.1.1. Paragraph 6.a of the 2017 Lease is deleted and replaced in its entirety with the following: “The City has issued a notice to the Association that the Colorado Division of Water Resources has accepted construction of the new Reservoir Dam pursuant to its Rules and Regulations for Dam Safety and Dam Construction, 2 CCR 402-1 (or successor regulations) and that Phase 2 (Construction) is complete; or.” 8.1.2. Paragraph 4.a is therefore added to the 2017 Lease: “During the time period after the City has begun construction on the Halligan Reservoir enlargement and before the City has issued a notice to the Association that the Colorado Division of Water Resources has accepted construction of the new Reservoir Dam pursuant to its Rules and Regulations for Dam Safety and Dam Construction, 2 CCR 402-1 (or successor regulations) and that Phase 2 (Construction) is complete, the City shall be entitled to impose reasonable limitations on the Association’s use of the Property to allow the City to complete construction and for health and safety reasons.” 8.2. Rent. As part of this Agreement, the Parties desire to no longer require the Association to make the “Annual Rent” payments under Paragraph 8 of the 2017 Lease. Paragraph 8 of the 2017 Lease is therefore replaced in its entirety with the following: EXHIBIT A Page 17 of 22 “Rent. Full compensation to the City for the lease for the Property and Reservoir having been made pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project; no additional compensation to the City is required for the Initial Term or any Extension Term of this Lease Agreement.” 9. POTENTIAL CLAIMS UNDER THE “1987 AGREEMENT.” The City entered into an Agreement, dated October 14, 1987,7F 8 with the Phantom Canyon Ranch Co., a Colorado limited partnership, and Halligan Resources Co., a Colorado limited partnership (together, the “Partnerships”). The Association may be a successor-in-interest to one or both of the Partnerships in certain respects. The Association thus may have certain potential claims against the City under the 1987 Agreement, though City does not admit, agree, concede, stipulate to, or waive anything with respect to such potential claims. As part of this Agreement, the Association hereby releases and forever discharges the City from any and all claims under the 1987 Agreement. 10. RECREATION ON THE RESERVOIR. The City agrees that the Association shall have the same rights to utilize the surface of the enlarged Reservoir as the public. Absent a subsequent agreement between the City and the Association, the City further agrees to not authorize public access to the surface of the Reservoir to the east of the line between Sections 33 and 34 and only authorize access to the remainder of the Reservoir to human-propelled boaters that have and utilize valid fishing licenses. 11. GENERAL PROVISIONS. 11.1. Monetary Compensation. In addition to the other obligations and compensation of the Parties under this Agreement, the Parties agree to the following monetary compensation. 11.1.1. Within twenty-eight (28) days of the execution of this Agreement, the City shall pay the Association $____.00. 11.1.2. At the Option Closing, the Association shall pay the City based on the following: The sum of the prices for each of the Options the Association exercises (as stated in Paragraphs 7.2.1.1, 7.2.2.1, and 7.2.3.1) less $____.00, to account for the values the City and the Association are otherwise acquiring under this Agreement. If the above results in a negative number, the City shall owe the Association that amount. 11.1.3. As identified in Paragraphs 5 and 6, the City may require temporary construction easements across the Association Land for Phase 2, access to the 8 See Memorandum of Agreement, dated November 12, 1987, recorded with the Larimer County Clerk and Recorder on November 13, 1987 at Reception No. 87064570. EXHIBIT A Page 18 of 22 Reservoir and the North Fork through permanent access easements across Association Land for Phase 3, and rights to inundate certain Association Lands during Phase 3, which may require monetary payments from the City to the Association. The Parties agree to explore in good faith whether the amounts the Association owes to the City under Paragraph 11.1.2 and the amounts the City may owe the Association for access under Phases 2 and 3 may be aggregated to result in a single net payment from one entity to the other. 11.2. Recording. The City shall be responsible for recording this Agreement with the Larimer County Clerk and Recorder. The City shall pay all recording costs. 11.3. Fiscal Contingency. Notwithstanding any other provisions of this Agreement to the contrary, the obligation of the City in fiscal years after the fiscal year of this Agreement shall be subject to appropriation of funds sufficient and intended therefor, with the City having the sole discretion to determine whether the subject funds are sufficient and intended for use under this Agreement. The failure of a City to appropriate such funds shall be grounds for termination of this Agreement upon written notice pursuant to Paragraph 11.8. 11.4. Default and Remedies. If either Party fails to comply with the provisions of this Agreement, the complying Party shall provide prompt written notification to the noncomplying Party specifying the noncompliance and the section(s) of this Agreement with which the noncomplying Party is in default. Thereafter, the noncomplying Party shall have thirty-five (35) days following receipt of such notice to cure such noncompliance, provided however that if the cure to such noncompliance is of a nature that it reasonably requires more than 35 days, then the other Party may grant an extension of time to the noncomplying Party to cure such default, but in no event to exceed twenty-eight (28) days. The complying Party may not unreasonably withhold its grant of an extension of time to cure under this Paragraph 11.4. In the event that the noncomplying Party does not achieve compliance within the cure period, as may be extended, then the complying Party may seek all such remedies available under Colorado law, provided that neither Party shall be entitled to consequential or punitive damages. In the event of a default, the noncomplying Party agrees to reimburse the other Party for reasonable attorney’s fees in enforcing this Agreement. 11.5. No Third-Party Beneficiaries. This Agreement is entered into between the Parties for the purposes set forth herein. It is the intent of the Parties that they are the only beneficiaries of this Agreement and the Parties are only benefitted to the extent provided under the express terms and conditions of this Agreement. 11.6. Governing Law and Enforceability. This Agreement shall be construed in accordance with the laws of the State of Colorado. The Parties recognize that the constitutions, statutes, and rules and regulations of the State of Colorado and of the United States, as well as the Parties’ respective articles of incorporation, bylaws, city charters and codes, and rules and regulations, impose certain legal constraints on each Party and that the Parties intend to carry out the terms and conditions of this Agreement subject to those EXHIBIT A Page 19 of 22 constraints. Whenever possible, each provision of this Agreement shall be interpreted in such a manner so as to be effective and valid under applicable law. 11.7. Waiver. A waiver of a default of any of the provisions of this Agreement shall not constitute a waiver of any subsequent default of the same or another provision of this Agreement. Nothing in this Agreement shall be construed as any waiver of governmental immunity of the Parties who are governments or any other governmental provisions of State law. Specifically, by entering into this Agreement, neither Party waives the monetary limitations on liability or any other rights, immunities, or protections provided by the Colorado Government Immunity Act, C.R.S. § 24-10-101, et seq., or any successor or similar statutes of the State of Colorado. 11.8. Notices. All notices or other communications hereunder shall be sufficiently given and shall be deemed given (i) when personally delivered; (ii) on the date and at the time of delivery or refusal of acceptance of delivery if delivered or attempted to be delivered by an overnight courier service to the party to whom notice is given at the address specified below; (iii) on the date and at the time shown on the electronic mail if sent by electronic transmission at the e-mail addresses set forth below and receipt of such electronic mail is acknowledged by the intended recipient thereof; or (iv) after the lapse of seven (7) days following mailing by certified mail-return receipt requested, postage prepaid, addressed as follows: To Fort Collins: City Manager City Hall West 300 LaPorte Avenue; P.O. Box 580 Fort Collins, Colorado 80522-0580 Telephone: E-mail: With copy to: Fort Collins City Attorney 300 LaPorte Avenue; P.O. Box 580 Fort Collins, Colorado 80522-0580 Telephone: E-mail: epotyondy@fcgov.com and: Fort Collins Utilities Attn: Halligan Water Supply Project Manager 4316 LaPorte Ave. Fort Collins, Colorado 80521 E-mail: edornfest@fcgov.com To the Association: Landowners Assoc. for Phantom Canyon Ranches Attn: Brian T. Gray, President (or current LAPCR President) 1738 Bonny Drive Loveland, CO 80538 EXHIBIT A Page 20 of 22 (704) 614-7770 btgray@att.net With copy to: Registered Agent on File with Colorado Secretary of State 11.9. Construction. This Agreement shall be construed according to its fair meaning as it was prepared by the Parties. Headings in this Agreement are for convenience and reference only and shall in no way define, limit, or prescribe the scope or intent of any provision of this Agreement. 11.10. Entire Agreement. This Agreement constitutes the entire agreement of the Parties regarding the matters addressed herein. This Agreement binds and benefits the Parties and their respective successors. Covenants or representations not contained in this Agreement regarding the matters addressed herein shall not bind the Parties. 11.11. Representations. Each Party represents to the other parties that it has the power and authority, pursuant to their respective governing policies and rules, to enter into this Agreement and the individual signing below on behalf of that Party has the authority to execute this Agreement on its behalf and legally bind that Party. 11.12. Assignment. No Party may assign any rights or delegate any duties under this Agreement without the written consent of the other Party. 11.13. Severability. If any provision of this Agreement shall prove to be illegal, invalid, unenforceable, or impossible of performance, the remainder of this Agreement shall remain in full force and effect. [Remainder of Page Intentionally Blank] EXHIBIT A Page 21 of 22 CITY OF FORT COLLINS, COLORADO, a home-rule city By: ______________________________________ Date: Kelly DiMartino, Interim City Manager ATTEST: By: ______________________________________ City Clerk Name: ____________________________________ Title: ____________________________________ APPROVED AS TO LEGAL FORM: By: ______________________________________ Eric R. Potyondy, Assistant City Attorney EXHIBIT A Page 22 of 22 LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado non-profit corporation By: ________________________________________ Date: Brian T. Gray, President EXHIBIT A Landowners’ Association for Phantom Canyon Ranches Land City of Fort Collins Land Exhibit A-1 Association Land and City Land Map ‘Small Association Parcels’ * Not to scale EXHIBIT A Landowners’ Association for Phantom Canyon Ranches Land City of Fort Collins Property Exhibit A-2 Various Conveyances Maps: Map 1 All conveyances adjacent to Halligan Reservoir: Shoreline Access Easement; Fee title (121+/- acres); Recreational River Access Easement; Reserved Road and River Easements; Small Association Parcels Shoreline Access Easement Area Not to scale—for illustrative purposes only. Final configurations contingent upon survey and completed construction. Section lines  33 34 Fee title (121+/- acres) Retained West Access Easement Reserved River Access Easement Recreational River Access Easement Small Association Parcels (road location will likely change following construction) EXHIBIT A Landowners’ Association for Phantom Canyon Ranches Land Phase 1 River Access Easement to City Exhibit A-2 Various Conveyances Maps: Map 2 Phase 1 River Access Easement to City* 12 07 11 Section lines * Not to scale—for illustrative purposes only—general depiction of easement areas. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 1 of 15 TEMPORARY ACCESS EASEMENT WITH TERMS AND CONDITIONS (Phase 1 (Permitting and Design) of the Halligan Water Supply Project) (Access to North Fork of the Cache la Poudre River) THIS TEMPORARY ACCESS EASEMENT DEED WITH TERMS AND CONDITIONS (“Easement”) is made and entered into this _____ day of____________, 20__ (the “Effective Date”), by and between The Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation (“LAPCR”), and THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”). RECITALS A. The City is pursuing the Halligan Water Supply Project (“Halligan Project”). The Halligan Project includes: the enlargement of Halligan Reservoir, also known as North Poudre Reservoir No. 16 (“Reservoir”), which primarily entails replacing or enlarging the Reservoir’s dam (“Reservoir Dam”);0F 1 and the replacement of the diversion structure for the North Poudre Canal and related infrastructure (“Diversion Structure”)1F 2 on the North Fork of the Cache la Poudre River (“North Fork”). The Diversion Structure and portions of the North Fork are located on land owned by LAPCR. B. The City is currently working on the various permitting processes for the Halligan Project, and on design for the infrastructure and overall completion of the project. This work and aspect of the Halligan Project is referred to as “Phase 1 (Permitting and Design).” C. As part of Phase 1 (Permitting and Design) of the Halligan Project, City personnel and certain other people associated with the Halligan Project (which people are identified below) need to cross the “Property” (which is defined in Paragraph 1 below) to access the North Fork for certain limited purposes described herein. D. This Easement is intended to document and provide for the City’s orderly use of the Property during Phase 1 (Permitting and Design) for access to the North Fork and to better protect LAPCR from the City’s use of the Property. As set forth below, LAPCR is willing to grant the City access across the Property for Phase 1 (Permitting and Design), pursuant to the terms and conditions of this Easement. Nothing in this Easement is intended to address the City’s access or use of the Property for phases of the Halligan Project other than for Phase 1 (Permitting and Design). E. The Property is encumbered by that certain deed of conservation easement held by The Nature Conservancy (“TNC”), recorded on December 31, 1987, at Reception No. 87072156 (the 1 The Reservoir is an on-channel reservoir located on the North Fork, in portions of Sections 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M. The Reservoir Dam is located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. 2 The Diversion Structure is located in the North Fork in the SE1/4 of Section 12, Township 10 North, Range 71 West of the 6th P.M. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 2 of 15 “Conservation Easement”). TNC has reviewed and approved the conditions and restrictions contained in this Easement and has executed its consent to LAPCR’s grant of the TAE (as defined in Paragraph 2) over the Property, which such consent is attached hereto. F. In exchange for the promises and considerations set forth in this Easement, the adequacy of which is hereby acknowledged, the City and LAPCR agree as follows. AGREEMENT AND EASEMENT 1. LAPCR’s Property. LAPCR is the owner of a parcel of real property located in Larimer County, Colorado. The parcel is legally described on Exhibit A of Temporary Access Easement (Legal Description and Depiction of the LAPCR Property), which consists of one (1) page that is attached hereto and made a part of this Easement (the “Property”). 2. Grant of Easement – Consideration. For and in consideration of the covenants and agreements herein set forth, and pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project, dated ________________, 2022, and other good and valuable consideration, the receipt and adequacy of which LAPCR acknowledges, LAPCR grants, sells and conveys to the City, its successors and assigns, a temporary, non-exclusive access easement (the “TAE”) on, over, and across the North Fork, including its bed and fifty (50) horizontal feet from the then-existing water line along each of its banks, where it crosses the Property as described more fully on Exhibit B of Temporary Access Easement (Legal Description and Depiction of the LAPCR Property), consisting of two (2) pages that are attached hereto and made a part of this Easement (the “TAE Area”), subject to the conditions and restrictions set forth below. It is the express intent of the Parties that the TAE Area shall be as defined herein, with the recognition that: (1) the TAE Area’s specific width will fluctuate as the waters of the North Fork rise and fall, with the Parties’ intent being that the TAE Area’s specific width at any given time be the sum of fifty (50) horizontal feet on one bank plus the actual width of the North Fork between its water lines plus (50) horizontal feet on the other bank; and (2) the TAE Area’s specific location on the Property will move with the North Fork as it moves due to erosion, deposition, and other forces, with the Parties’ intent being that the TAE Area’s specific location move with the actual location of the North Fork, provided, however, that the TAE Area not extend farther up or downstream. 3. Purpose and Uses of Easement. The City may use the TAE Area for the purposes of: minimally-invasive habitat evaluation studies, such as fish and macroinvertebrate surveys; non- invasive topographic and geomorphic surveys; water quality and other environmental sampling, including the installation of ground water monitoring wells with data loggers installed by hand; minimally-invasive, small scale soil, water, aquatic species and/or vegetation sampling; and other site visits related to permits and approvals needed for the Halligan Project. Larger scale, more invasive studies and surveys (electro-shocking of the river, digging pits to remove large volumes of soil, and cutting or clearing of vegetation, by way of example only) may be permitted with the prior written approval of TNC. The City’s use of the TAE Area must be directly related to the Halligan Project as further described in this paragraph. The City’s use of the TAE Area must only be between the hours of 8AM and 6PM, Monday through Friday (but in no event after sunset or on a federal holiday). The City’s use of the TAE Area must only be by foot. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 3 of 15 The City is hereby authorized to temporarily access the TAE Area only to gain entrance to the North Fork for site visits and data collection related to Phase 1 (Permitting and Design). City personnel may bring the following guests with them during site visits: land surveyors; appraisers; and personnel from and consultants for governmental agencies involved in the various permitting and approval processes for the Halligan Project including but not limited to: the U.S. Army Corps of Engineers, U.S. Fish and Wildlife Service, Colorado Department of Public Health and Environment, Colorado Parks and Wildlife, Colorado Water Conservation Board, and Larimer County (collectively the “City Guests”). On most occasions the City Guests will be accompanied by City personnel, but on rare occasions, the City may request permission from LAPCR that any City Guest working on its behalf access the TAE Area without City personnel for purposes of Phase 1 (Permitting and Design) of the Halligan Project. If any City Guests violates any of the terms or obligations contained in this Easement while not being accompanied by City personnel, then LAPCR may prohibit any future use of the TAE Area by such City Guest without City staff being present. Nothing in this Easement shall be construed to create a right to access the TAE Area by any person or entity other than the City. An additional restriction applies to the following portion of the TAE Area: the portion of the TAE Area along the North Fork lying between the point where it flows onto Section 12 from the west and the point where it first flows out of Section 12 to the south (“Restricted TAE Area”). Use of the Restricted TAE Area by the City or City Guests is restricted to five (5) days for each year of the Term of this Easement unless specific written permission is granted otherwise by LAPCR. By way of illustration only, if Colorado Parks and Wildlife access the Restricted TAE Area on January 1, 2, and 3 2023, and then the City accesses the Restricted TAE Area on January 4 and 5 2023, the City and City Guests are prohibited from using the Restricted TAE Area for the remainder of the 2023 calendar year, unless given specific written authorization from LAPCR. 4. Term. The TAE will terminate when construction on the Reservoir Dam begins, but in no event later than December 31, 2027 (the “Term”). If construction is delayed beyond December 31, 2027, this Easement may be renewed on a two-year basis, for additional compensation, upon mutual agreement of both parties in writing. 5. City’s Obligations (a) The City will not install any improvements in the TAE Area, except for the ground water monitoring wells identified in Paragraph 3 above. Such wells shall be removed upon or before termination of this Easement. (b) The City, its contractors, agents, guests, and invitees will comply with any and all applicable laws. (c) The City’s access to the TAE Area must be scheduled and conducted so as to minimize, to the extent practicable, the impacts to the Property and LAPCR’s use thereof. City personnel will notify LAPCR at least 24 hours in advance of any proposed data collection or site visit via email and/or telephone. LAPCR will EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 4 of 15 provide City personnel with an up-to-date, email and telephone number for such purposes. (d) The City is solely responsible for acquiring access to and across any other lands in order to reach and use the TAE Area under this Easement. (e) The City or City Guests shall not undertake any activity that would prevent access to LAPCR across the TAE Area or unreasonably interfere with LAPCR’s quiet enjoyment of the Property. (f) All City personnel or City Guests will carry identification declaring the agency/party represented. (g) The City shall comply with all terms contained in the Conservation Easement. The City, at its sole cost and expense, must repair any and all damage to the TAE Area resulting from the City’s activities under this Easement, including activities of the City’s agents, employees, guests or contractors, and return the Property, including landscape, shrubs, trees, soil conditions, and other physical site conditions (including but not limited to any changes to the North Fork’s course, shoreline, and vegetative cover) to their original state at the time of this Easement, all to the reasonable satisfaction of LAPCR and TNC, and at no cost to LAPCR or TNC. If any remaining damage exists as a result of the City’s use at the end of the Term, LAPCR and/or TNC shall give to the City written notice of the required repairs. If such repairs are not completed by the City, at its sole cost and expense, within thirty (30) days or, if such work cannot be reasonably completed in thirty (30) days, as soon as practicable thereafter, LAPCR shall have the right to perform such repair work. In such event, LAPCR shall be entitled to reimbursement from the City for all costs and expenses incurred by LAPCR in performing such repair work upon demand, together with interest on such amounts at the rate of 8% per annum from the date incurred by LAPCR until repaid by the City. Any work by the City in the TAE Area must be performed in a safe and sanitary manner and a good and workmanlike manner, and in compliance with all applicable laws. 6. LAPCR’s Rights. LAPCR reserves the right to use the TAE Area for any purposes not inconsistent with the City’s rights granted in this Easement. LAPCR will not erect or construct any structure or improvement, or drill or operate any well, construct any reservoir or impoundment or other obstruction, install or plant any trees or woody shrubs, or otherwise improve the TAE Area or change the ground level in the TAE Area during the term of this TAE without the prior written consent of the City. 7. Maintenance of the TAE Area. (a) LAPCR is not responsible for any conditions directly caused by City’s use and occupancy of the TAE Area. (b) LAPCR and the City will not deposit, or permit or allow to be deposited, earth, rubbish, debris, or any other substance or material, whether combustible or noncombustible, on the TAE Area and surrounding area. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 5 of 15 8. Enforcement. In the event of any violation of the terms of this Easement, each party shall be entitled to bring an action for damages and/or negative or affirmative injunctive relief, and to seek any other right or remedy available at law or in equity. The failure to enforce any provision hereof shall not constitute a waiver of such provision or any right or remedy arising therefrom. 9. Representations of LAPCR. LAPCR states that it is the lawful owner in fee simple of the Property, subject to the Conservation Easement, and that it has good and lawful right and authority to grant this Easement. 10. Insurance. The City shall procure, pay for, and keep in full force and effect during the Term, a comprehensive policy of general liability insurance covering the City’s use of the Property and insuring the City in an amount not less than One Million Dollars ($1,000,000.00) covering bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence directly from work under this Agreement. Such coverage must include, without limitation, the insured’s liability for property damage, bodily injuries, and death of persons in connection with the operation, maintenance, or use of the Property (including acts or omissions of the City or of its officers, employees, agents or guests), and protection against liability for non- owned and hired automobiles and other vehicles or equipment. For each and every one of its contractors, using the TAE Area, the City will provide to LAPCR prior to use of the Easement, or shall require its contractors to provide certificates of insurance for general liability policies, commercial automobile policies and workers compensation policies. In the event the City fails or neglects to maintain, or require its contractors to procure and maintain, as applicable, the insurance required by this paragraph, then LAPCR shall have the right to refuse entry to such contractor. 11. Additional Terms on the Use of the Property. (a) Use of the Property by the City pursuant to this Easement is subject to the Declaration of Easements, the Covenants, the Rules and Regulations of LAPCR and the prohibitions, restrictions, and other terms contained in the Conservation Easement. (b) Except as otherwise stated in this Easement, the City shall be deemed to have accepted the Property in its present condition, as is, where is, with all faults, patent and latent, without any representations or warranties whatsoever by LAPCR, its agents or employees. The City assumes all risks associated with use of the Property. The City acknowledges that neither LAPCR nor any of LAPCR’s agents have made any representations or warranties whatsoever regarding the Property. The City assumes all risk that any adverse matter of whatever kind or nature including, but not limited to the physical condition of the Property that may arise in the future. LAPCR shall have no obligation to the City to maintain the Property in its present condition or to improve the Property for the City’s use. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 6 of 15 (c) To the extent permitted by law and without waiving its right to governmental immunity, the City shall be deemed to have released LAPCR and TNC, their officers, directors, members, agents, guests and employees and their respective heirs, personal representatives, successors, and assigns (“Released/Indemnified Parties”) from and against any and all claims, demands, actions, suits, and proceedings of whatever kind or nature that the City may now have or may have at any time in the future arising out of or as a result of the present or any future condition of the Property. (d) To the extent permitted by law and without waiving its right to governmental immunity, the City shall defend, indemnify and hold harmless the Released/Indemnified Parties from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the use or misuse of the of the Property by the City, its agents, employees, contractors, guests or any other person or entity using the Property with the express or implied authorization, permission, or consent of the City. To the extent permitted by law and without waiving its right to governmental immunity, the City shall also defend, indemnify and hold harmless the Released/Indemnified Parties and the Property from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the any work performed on the Property by the City, its agents, employees, contractors, including but not limited to mechanic’s lien claims. 12. No Liens. The City shall ensure that no liens attach to the Property in connection with its use of the TAE for Phase 1 (Permitting and Design). In the event that a lien is filed against the Property or TAE Area arising out of Phase 1 (Permitting and Design) the City shall cause it to be removed and released as soon as reasonably practicable. 13. Default and Litigation Expenses. If a party to this Easement is in default in performance of its respective obligations hereunder, the other party has the right to an action for specific performance or damages or both. Prior to proceeding with any such action, the party not in default must first send written notice to the defaulting party specifying the default and affording such party a reasonable period to cure the default, but in no event shall the period to cure the default extend beyond 90 days. In the event a party defaults in any of its covenants or obligations and the party not in default commences and substantially prevails in any legal or equitable action against the defaulting party, the defaulting party expressly agrees to pay all reasonable expenses of the litigation, including a reasonable sum for attorneys' fees or similar costs of legal representation. 14. Not a Public Dedication. This Easement and the rights granted herein are for the use of the City pursuant to the terms hereof. Nothing contained herein shall be deemed to be a gift or dedication of the Property or any portion thereof, to, or for the benefit of the general public or for any public purpose whatsoever. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 7 of 15 15. Obligations Subject to Appropriation. All financial obligations of the City in fiscal years subsequent to the date of this Easement are subject to appropriation of funds sufficient and intended for such purpose by the Fort Collins City Council in its discretion. 16. Additional Terms and Conditions. Whenever used herein, the singular number includes the plural, the plural the singular; and the use of any gender is applicable to all genders. All of the covenants herein contained are binding upon and inure to the benefit of the parties hereto and their personal representatives, successors and assigns. If any term of this Easement is determined by any court to be unenforceable, the other terms of this Easement shall nonetheless remain in full force and effect; provided, however, that if the severance of any such provision materially alters the rights or obligations of the parties, the parties shall engage in good faith negotiations in order to adopt mutually agreeable amendments to this Easement as may be necessary to restore the parties as closely as possible to the initially agreed upon relative rights and obligations. IN WITNESS WHEREOF, the parties have set their hands and seals the day and year first above written. [Remainder of Page Intentionally Blank] EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 8 of 15 The Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation Date: By: Brian T. Gray, President STATE OF COLORADO ) ) ss COUNTY OF ) The foregoing instrument was acknowledged before me this ___ day of , 2022, by Brian T. Gray as President for The Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation. WITNESS my hand and official seal. Notary Public My Commission expires: EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 9 of 15 CONSENT OF THE NATURE CONSERVANCY The Undersigned, being the holder of a perpetual conservation easement property right (the “Conservation Easement”) over the property described on Exhibit A, hereby consents and agrees to the grant of the temporary non-exclusive access easement (the “Easement”) to which this Consent is attached to The City of Fort Collins, Colorado (the “City”) from the Landowners’ Association for Phantom Canyon Ranches (“LAPCR”). Provided, however, that such Easement shall remain subordinate to the Conservation Easement and is subject to the terms and conditions contained in the Conservation Easement. The undersigned further agrees that it will not declare LAPCR in default under the Conservation Easement or seek any remedy from or against the LAPCR due to the recording of the Easement nor due to any of the uses or practices of the Property by the City during the term of the Easement, for which the City shall remain responsible as set forth in the Easement. Dated this _______ day of ____________, 2022. THE NATURE CONSERVANCY, a District of Columbia non-profit corporation By: Name: Its: STATE OF _______________ ) ) ss COUNTY OF _____________ ) The foregoing instrument was acknowledged before me this ____ day of ____________, 2022, by ___________________, as ____________________ of The Nature Conservancy, a District of Columbia non-profit corporation. Witness my hand and official seal. ___________________________________ Notary Public My commission expires: ______________ EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 10 of 15 THE CITY OF FORT COLLINS, COLORADO a Municipal Corporation Date: By: Kelly DiMartino, Interim City Manager ATTEST: City Clerk (Print Name) APPROVED AS TO FORM: Assistant City Attorney (Print Name) STATE OF COLORADO ) ) ss COUNTY OF LARIMER ) The foregoing instrument was acknowledged before me this day of , 2022, by Kelly DiMartino as Interim City Manager of the City of Fort Collins. Witness my hand and official seal. My Commission expires: Notary Public EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 11 of 15 EXHIBIT A OF TEMPORARY ACCESS EASEMENT (Map of the LAPCR Property) NW1/4, SW1/4, and SE1/4 Section 12, Township 10 North, Range 71 West of the 6th P.M., County of Larimer, State of Colorado. EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 12 of 15 EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 13 of 15 EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 14 of 15 EXHIBIT B OF TEMPORARY ACCESS EASEMENT (Legal Description and Depiction of the Temporary Access Easement Area) ( Page 1 of 2) EXHIBIT A Exhibit B to Agreement Regarding the Halligan Water Supply Project Temporary Access Easement – City Grantee Form version 6/27/16 Page 15 of 15 EXHIBIT B OF TEMPORARY ACCESS EASEMENT (Legal Description and Depiction of the Temporary Access Easement Area) Legal Description and Depiction of the Temporary Access Easement Area (Page 2 of 2) EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 1 of 17 SPECIAL WARRANTY DEED SUBJECT TO RESTRICTIVE COVENANT (Conveyance of Small Association Parcels from LAPCR to the City, with One Such Parcel (North Parcel) Subject to a Restrictive Covenant) THIS SPECIAL WARRANTY DEED (“Deed”), made this ___ day of _________, 20__, by and between LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado nonprofit corporation (“Grantor”), whose mailing address for the purpose of this Deed is 1738 Bonny Dr., Loveland, CO 80538, and the CITY OF FORT COLLINS, COLORADO, a municipal corporation, whose mailing address for purposes of this General Warranty Deed is P.O. Box 580, Fort Collins, Colorado 80522 (“Grantee”). W I T N E S S E T H : That the Grantor, for and in consideration of the sum of ______________________ Dollars ($_________), and pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project, dated __________, 2022, and other good and valuable consideration, to the Grantor in hand paid by the Grantee, hereby grants, sells, and conveys to Grantee that certain real property, together with all appurtenances and improvements, if any, situate, lying, and being in the County of Larimer, State of Colorado more particularly described in Exhibit A of Special Warranty Deed attached hereto consisting of ____(xxx) page(s), and incorporated herein by this reference, which real property shall hereinafter be referred to as “Property”, but with respect to the portion of the Property located north of Halligan Reservoir (“North Parcel”) only, more particularly described in Exhibit B of Special Warranty Deed attached hereto consisting of ____(xxx) page(s)reserving unto the Grantor, its successors and assigns: a restrictive covenant on the North Parcel as described in Exhibit D of Special Warranty Deed (Restrictive Covenant), attached hereto, consisting of __ pages, and incorporated herein by this reference. TO HAVE AND TO HOLD the Property with appurtenances and improvements, unto Grantee, its successors and assigns forever. AND GRANTOR for itself, its successors and assigns, does covenant and agree that it shall and will WARRANT AND FOREVER DEFEND the above bargained Property in the quiet and peaceable possession of the Grantee, its successors and assigns, against all and every person or persons claiming the whole or any part thereof, by, through, or under Grantor, SUBJECT to this matters set forth on Exhibit C of Special Warranty Deed (Permitted Exceptions) attached hereto and incorporated herein by this reference. IN WITNESS WHEREOF, the Grantor has executed this Special Warranty Deed on the date set forth above. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 2 of 17 GRANTOR: Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation Date: By: Brian T. Gray, President STATE OF COLORADO ) ) ss COUNTY OF ____________) The foregoing instrument was acknowledged before me this _______ day of ________, ______, by Brian T. Gray as President for the Landowners’ Association for Phantom Canyon Ranches. Witness my hand and official seal. My Commission expires: _______________________ Notary Public EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 3 of 17 ACCEPTED BY GRANTEE: THE CITY OF FORT COLLINS, COLORADO a Municipal Corporation (the Grantee) Date: _________________ By: Kelly DiMartino, Interim City Manager ATTEST: City Clerk (Print Name) APPROVED AS TO FORM Assistant City Attorney (Print Name) EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 4 of 17 EXHIBIT A OF SPECIAL WARRANTY DEED (Legal Description and Depiction of the Property (All Parcels, Including the North Parcel)) *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project* EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 5 of 17 EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 6 of 17 EXHIBIT B OF SPECIAL WARRANTY DEED (Legal Description of the North Parcel) *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project* EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 7 of 17 EXHIBIT C OF SPECIAL WARRANTY DEED (Permitted Exceptions) EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 8 of 17 EXHIBIT D OF SPECIAL WARRANTY DEED (Restrictive Covenant on North Parcel) DECLARATION OF RESTRICTIVE COVENANT THIS DECLARATION OF RESTRICTIVE COVENANT (“Covenant”) is made this _____ day of ____________, 202_, by CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”) whose address is 300 Laporte Avenue, P.O. Box 580 Fort Collins, CO 80522- 0580 in favor of the LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, INC. a Colorado nonprofit corporation referred to hereinafter as (“LAPCR”), whose address is 1738 Bonny Drive, Loveland, CO 80538. R E C I T A L S : WHEREAS, LAPCR has conveyed to City fee simple title to certain real property described on Exhibit B of the Special Warranty Deed, Subject to Restrictive Covenant, to which this Covenant is attached (“North Parcel”), reserving from such conveyance the restrictions set forth herein. WHEREAS, this Covenant shall encumber and run with the North Parcel for the benefit of LAPCR and its successors in interest. WHEREAS, LAPCR is the owner of those certain parcels of real property located in Larimer County, Colorado, which are legally described on Exhibit 1 of Restrictive Covenant (Legal Description of LAPCR Property), consisting of ___ (____) pages, attached and incorporated herein by reference (“LAPCR Property”). WHEREAS, the North Parcel possesses natural, scenic, and open space values (collectively, “Conservation Values”) of great importance to LAPCR, the City and the people of Larimer County. WHEREAS, the Conservation Values of the North Parcel include views of the mountain backdrop to Halligan Reservoir and surrounding foothills, wildlife habitat and the aesthetic value as open space. WHEREAS, the City and LAPCR desire to place a Covenant upon the North Parcel for the purpose of protecting its Conservation Values for the benefit of LAPCR’s Property. NOW, THEREFORE, in consideration of the above and the mutual covenants, terms, conditions, and restrictions contained herein and pursuant to the laws of the State of Colorado, the City and LAPCR, on behalf of themselves and their successors-in-interest and assigns, hereby acknowledge and agree to the following Covenant in perpetuity over the North Parcel of the nature and character and to the extent hereinafter set forth. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 9 of 17 1. Purpose. The purpose of this Covenant is to ensure that the North Parcel will be retained predominately for its Conservation Values, and water utility purposes related to Halligan Reservoir, and to prevent any use of the North Parcel that will significantly impair or interfere with the Conservation Values, which will facilitate meeting the terms and conditions of approval and permits needed for the enlargement of Halligan Reservoir, including mitigation-related items, and to help maintain the quality of water in the Halligan Reservoir, which is beneficial to the City and its water utility for various reasons and purposes. LAPCR intends that this Covenant will restrict the use of the North Parcel to activities that are consistent with the Conservation Values. The North Parcel shall not be used for activities that significantly diminish the Conservation Values. These covenants, conditions and restrictions are hereby imposed on the North Parcel. 2. Submission of Property to Restrictive Covenants. LAPCR hereby impresses and imposes upon the North Parcel the covenants, conditions, and restrictions set forth and provided for herein. This Covenant shall be binding upon the City, its successors, assigns, and grantees. The North Parcel shall be held, sold and conveyed subject to all of the covenants, conditions, and restrictions set forth herein, which will run with the land and title, and the grantee of any deed conveying the North Parcel or any portion thereof will be deemed by the acceptance of such deed to have agreed to all such covenants, conditions, and restrictions, and to have covenanted to observe, comply with and be bound by all such covenants, conditions, and restrictions. 3. Use and Management of the Property. Any activities on or use of the North Parcel that are not materially inconsistent with the purposes of the Covenant are permitted (including recreation (e.g., hiking, hunting, fishing), wildlife and land management, and access to Halligan Reservoir), subject to any applicable terms and conditions set forth below in the following subparagraphs: a. No Structures or Development. No structures shall be permitted on the North Parcel. No development of the North Parcel for commercial, industrial, or residential purposes shall be allowed. b. Motorized Vehicles. Use of motorized vehicles shall be allowed only for: (i) access to Halligan Reservoir by authorized City personnel or its agents and contractors, including personnel from the State of Colorado involved in managing the North Parcel, but in no event, the general public; (ii) wildlife and land management; (iii) weed management; (iv) emergencies; and (v) as may be required for compliance with this Covenant, the Americans with Disabilities Act or similar laws. c. Target Shooting. Target shooting of any kind shall not be permitted on the North Parcel. In this Covenant, target shooting and hunting are distinct and the prohibition on target shooting does not limit hunting. d. Fences. Any existing fences may be repaired or replaced, and new fences may be built for purposes of reasonable and customary management of livestock and wildlife. All new fences shall be designed and constructed to be friendly to wildlife, such as, for example only, those identified by the Colorado Division of Parks and Wildlife wildlife-friendly fencing design standards. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 10 of 17 e. Subdivision. Any division or subdivision of title to the North Parcel is prohibited. Nothing in this subparagraph shall be construed to prohibit joint ownership of the North Parcel or ownership of the North Parcel by an entity consisting of more than one member. f. Grazing. Livestock grazing may occur only in accordance with sound stewardship and management practices, such as, for example only, those in the Natural Resources Conservation Service (NRCS) Field Office Technical Guide. For purposes of this Covenant “livestock” shall mean cattle, horses, goats, llamas, alpaca, and bison. No domesticated sheep shall be allowed to graze. This provision is not intended to preclude the use of goats for weed management. g. Trash and Storage of Materials. The dumping or uncontained accumulation of any kind of trash or refuse on the North Parcel, including but not limited to hazardous chemicals, is strictly prohibited. No storage of any vehicles, trailers, boats, etc. will be allowed. h. Mineral Rights. The City shall not develop, or lease or sell to others for development, any mineral rights that the City may own on the North Parcel without the written consent of the LAPCR. The City may impose additional limits and restrictions on the use of the North Parcel provided that they are otherwise consistent with applicable law. 4. Reserved Rights. Subject to interpretation under Paragraph 12, the City reserves unto itself, and to its successors, and assigns, all rights accruing from its ownership of the North Parcel, including the right to engage in or permit or invite others to engage in all uses of the North Parcel that are not specifically prohibited or inconsistent with any of the purposes of the Covenant or with the conditions, restrictions or other terms of this Covenant. 5. Rights of LAPCR. To accomplish the purposes stated herein, the City conveys to LAPCR the right to proceed at law or in equity to enforce the provisions of this Covenant, to prevent the occurrence of any of the prohibited activities set forth herein, and to require the restoration of areas or features of the North Parcel that may be damaged by any activity inconsistent with this Covenant. 6. Enforcement. a. If LAPCR finds what it believes is a violation of this Covenant, LAPCR shall notify the City in writing of the nature of the alleged violation. Upon receipt of this written notice, the City shall either: (a) restore the North Parcel to its condition prior to the violation; or (b) provide a written explanation to LAPCR of the reason why the alleged violation should be permitted. b. In the event that the parties are in dispute as to the actions required of the City hereunder, the City and LAPCR will meet as soon as possible to resolve the difference. If either LAPCR or the City determines that mediation would be advantageous in connection with such meeting, or if a resolution of this difference cannot be achieved at the meeting, EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 11 of 17 both parties agree to attempt to resolve the dispute through the process described in Paragraph 14.m. Should the parties fail to resolve the dispute, or if, in the LAPCR’s opinion, an ongoing or imminent violation could irreversibly diminish or impair the Conservation Values of the North Parcel or will not otherwise be resolved in a sufficiently prompt and effective manner, LAPCR may, at its discretion, take such legal action and seek such legal or equitable remedies as it determines to be appropriate or necessary, regardless of whether a dispute resolution process has been initiated or completed. Such remedies may include, without limitation, an injunction to stop an alleged violation, temporarily or permanently, or an order requiring the City to restore the North Parcel to its condition prior to the alleged violation. The City shall discontinue any activity which could increase or expand the alleged violation during any dispute resolution process or any legal proceeding pertaining to the alleged violation. c. LAPCR may enforce the terms of this Covenant at its discretion, but if the City, or its successors or assignees, breaches any term of this Covenant and LAPCR does not exercise its rights under this Covenant, LAPCR’s forbearance shall not be construed to be a waiver by the LAPCR of such term, or of any subsequent breach of the same or any other term of this Covenant, or of any of LAPCR’s rights under this Covenant. No delay or omission by LAPCR in the exercise of any right or remedy upon any breach by the City, or its successors or assignees, shall impair such right or remedy or be construed as a waiver. LAPCR shall not be obligated to the City, or to any other person or entity, to enforce the provisions of this Covenant. 7. Costs of Enforcement. Any costs reasonably incurred by LAPCR in enforcing a breach of the terms of this Covenant against the City, including, without limitation, costs of suit and reasonable attorneys' fees, and any costs of restoration necessitated by the City’s violation of the terms of this Covenant, shall be borne by the City. If the City prevails in any action to enforce an alleged breach of the terms of this Covenant, the City’s costs of suit, including, without limitation, reasonable attorneys' fees, shall be borne by LAPCR. 8. Acts Beyond City’s Control. Nothing contained in this Covenant shall be construed to entitle LAPCR to bring any action against the City for any injury to or change in the North Parcel resulting from causes beyond the City’s control, including, without limitation, fire, flood, drought, storm, landslides and seismic activity, or from any prudent action taken by the City under emergency conditions to prevent, abate, or mitigate significant injury to the North Parcel resulting from such causes. 9. Costs and Liabilities. The City retains all responsibilities and shall bear all costs and liabilities of any kind related to the ownership, operation, upkeep, repair, and maintenance of the North Parcel, including the maintenance of adequate comprehensive general liability insurance coverage. The City shall keep the North Parcel free of any liens arising out of any work performed for, materials furnished to, or obligations incurred by the City. No provision of this Covenant shall be construed as impairing the ability of the City to use the North Parcel as collateral for borrowing, provided that any mortgage or lien arising from such borrowing is expressly subordinated to this Covenant. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 12 of 17 10. Liability. a. General. The City is responsible for its own negligence and that of its officers, employees and agents. Nothing in this Covenant shall be construed as giving rise to any right or ability in, nor shall LAPCR have any right or ability to exercise physical or managerial control over the day-to-day operations of the North Parcel, or otherwise to become an operator with respect to the North Parcel within the meaning of The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended. b. No Waiver of Governmental Immunity. Anything else in this Covenant to the contrary notwithstanding, no term or condition of this Covenant shall be construed or interpreted as a waiver, either express or implied, of any of the immunities, rights, benefits or protection provided to City under the Colorado Governmental Immunity Act as amended or as may be amended in the future (including, without limitation, any amendments to such statute, or under any similar statute which is subsequently enacted) (“CGIA”), subject to any applicable provisions of the Colorado Constitution and applicable laws. c. Environmental Warranty. The City warrants that it shall remain in compliance with all applicable Environmental Laws. “Environmental Law” or “Environmental Laws” means any and all Federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, guidelines, policies or requirements of any governmental authority regulating or imposing standards of liability or standards of conduct (including common law) concerning air, water, solid waste, hazardous materials, worker and community right-to-know, hazard communication, noise, radioactive material, resource protection, subdivision, inland wetlands and watercourses, health protection and similar environmental health, safety, building and land use as may now or at any time hereafter be in effect. “Hazardous Materials” means any petroleum, petroleum products, fuel oil, waste oils, explosives, reactive materials, ignitable materials, corrosive materials, hazardous chemicals, hazardous wastes, hazardous substances, extremely hazardous substances, toxic substances, toxic chemicals, radioactive materials, infectious materials and any other element, compound, mixture, solution or substance which may pose a present or potential hazard to human health or the environment.” 11. Recordation/Subsequent Transfers. The City shall record this instrument in timely fashion in the official records of Larimer County, and may re-record it at any time as may be required. The City will notify LAPCR in advance of the proposed conveyance of any interest in all or any portion of the North Parcel, and shall incorporate the terms of the Covenant in any deed, Covenant or other legal instrument by which it divests itself of any interest in all or a portion of the North Parcel, except that for any lease the City need not incorporate the terms of the Covenant into such lease, but must notify all tenants in writing of this Covenant and advise such tenants that their lease is subject to the terms of this Covenant. The City further agrees to give written notice to LAPCR of the proposed transfer of any interest at least thirty (30) days prior to the City’s creation of a EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 13 of 17 legal obligation to carry out any such transfer. The failure of the LAPCR or the City to perform any act required by this paragraph shall not impair the validity of the Covenant or limit its enforceability in any way. 12. Interpretation. This Covenant shall be interpreted under the laws of the State of Colorado, resolving any ambiguities and questions of the validity of specific provisions so as to preserve the Conservation Values and give maximum effect to its conservation purposes. 13. Notices. Any notice, demand, request, consent, approval, or communication that either party desires or is required to give to the other under this Covenant shall be in writing and either served personally or sent by first class mail, postage prepaid, or by overnight commercial courier, addressed as follows and shall be deemed given when personally served, on the day after being sent by courier, or on the third business day after being mailed: If to the City: Fort Collins Utilities Attn: Halligan Water Supply Project Manager P.O. Box 580 700 Wood St. Fort Collins, CO 80522 With Copies to: Real Estate Services Manager City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 117 North Mason St. Fort Collins, CO 80524 City Attorney’s Office City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 300 LaPorte Avenue Fort Collins, CO 80521 If to LAPCR: Landowners Assoc. for Phantom Canyon Ranches Attn: Brian T. Gray, President (or current LAPCR president) 1738 Bonny Drive Loveland, CO 80538 (704) 614-7770 btgray@att.net With copy to: Registered Agent on File with Colorado Secretary of State EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 14 of 17 or to such other address as any party from time to time shall designate by written notice to the others. 14. General Provisions. a. Controlling Law. The interpretation and performance of this Covenant shall be governed by the laws of the State of Colorado. b. Liberal construction. Any general rule of construction to the contrary notwithstanding, this Covenant shall be liberally construed in favor of the grant to affect the purpose of the Covenant. If any provision in this Covenant is found to be ambiguous, an interpretation consistent with the purposes of the Covenant that would render the provision valid shall be favored over any interpretation that would render it invalid. c. Severability. If any provision of this Covenant or application thereof to any person or circumstance is found to be invalid, the remainder of the provisions of this Covenant, or the application of such provision to persons or circumstances other than those as to which it is found to be invalid, as the case may be, shall not be affected thereby. d. Entire Agreement. This Covenant sets forth the entire agreement of the parties with respect to the matters described herein, and supersedes all prior discussions, negotiations, understandings, or agreements relating to the Covenant, all of which are merged herein. e. No Forfeiture. Nothing contained herein shall result in a forfeiture or reversion of the City’s fee title to North Parcel. f. Joint Obligation. In the event that there is more than one owner of the North Parcel at any time, the obligations imposed by this Covenant upon the City shall be joint and several upon each of the owners of the North Parcel. g. Successors; Third Party Beneficiaries. The covenants, terms, conditions, and restrictions of this Covenant shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, beneficiaries, trustees, successors, and assigns and shall continue as a servitude running in perpetuity with the North Parcel, with the benefit running in perpetuity with the LAPCR Property. It is expressly understood and agreed that the enforcement of the terms and conditions of this Covenant and all rights of action relating to such enforcement, shall be strictly reserved to the parties and that nothing contained in this Covenant shall give or allow any claim or right of action whatsoever by any other third person. It is the express intention of the parties that any person or entity, other than the parties, receiving services or benefits under this Covenant shall be deemed an incidental beneficiary only. h. Termination of Rights and Obligations. A party’s rights and obligations under this Covenant terminate upon transfer of the party's interest in the Covenant or the North Parcel, except for any unpaid financial obligations of one party to the other which were owed prior to the date of such transfer under this Covenant. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 15 of 17 i. Captions. The captions in this instrument have been inserted solely for convenience of reference and are not a part of this instrument and shall have no effect upon construction or interpretation. j. Amendment. If the circumstances arise under which an amendment to or modification of this Covenant would be appropriate, the City and LAPCR are free to jointly amend this Covenant. Any amendment must be consistent with the conservation purposes of this Covenant. Any amendment must be in writing, signed by the duly authorized officials of each affected party, and recorded in the records of the Clerk and Recorder of Larimer County. k. Change of Conditions. A change in the potential economic value of any use that is prohibited by or inconsistent with this Covenant, or a change in any current or future uses of neighboring properties, shall not by itself constitute a change in conditions that makes it impossible or impractical for continued use of the North Parcel for conservation purposes and shall not constitute grounds for terminating the Covenant. l. Obligations Subject to Appropriation. The City’s obligations under this Covenant for subsequent fiscal years are subject to the annual appropriation by the City Council of the City of Fort Collins, in its sole discretion, of funds sufficient and intended for such purposes. m. Good Faith Negotiation/Mediation. Where this Covenant specifies that a decision requires the mutual agreement of the parties, the parties shall be obligated to make best efforts to negotiate in good faith to reach mutual agreement consistent with the Conservation Values and purposes of the Covenant. In the event that such efforts by the parties fail to result in mutual agreement through negotiation, the parties agree to attempt to resolve their dispute through mediation. Either party may commence the mediation process by providing the other party with written notice setting forth the subject of the dispute and the solution requested. Within ten (10) days after the receipt of the notice, the other party shall deliver a written response to the initiating party’s notice. The parties agree to meet with a mutually acceptable mediator to attempt to resolve the dispute. The initial mediation session shall be held within thirty (30) days after the initial notice, unless the selected mediator cannot accommodate the parties within that time. If the parties cannot agree upon a mediator, the City will provide LAPCR with a list of at least three professional mediation organizations in the Fort Collins/Denver area that are not affiliated with the City of Fort Collins. LAPCR will select an organization from the list within ten (10) days of receipt of the list, and the selected organization will be asked to choose a mediator for the parties. The parties agree to share equally the costs and expenses of the mediation, which shall not include the expenses incurred by each party for its own legal representation in connection with the mediation. The provisions of this subparagraph may be enforced by any court of competent jurisdiction, and the party seeking enforcement shall be entitled to an award of all costs, fees and expenses, including reasonable attorneys’ fees and other legal costs, to be paid by the party against whom enforcement is ordered. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 16 of 17 TO HAVE AND TO HOLD unto the LAPCR and its successors and assigns forever. EXHIBIT A Exhibit C to Agreement Regarding the Halligan Water Supply Project Page 17 of 17 Exhibit 1 of Restrictive Covenant (Legal Description of LAPCR’s Lands) * Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project. * EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 1 of 35 SPECIAL WARRANTY DEED SUBJECT TO RESERVED EASEMENTS AND RESTRICTIVE COVENANT (Conveyance of Certain Land South of Halligan Dam from the City to LAPCR) THIS SPECIAL WARRANTY DEED SUBJECT TO RESERVED EASEMENTS AND RESTRICTIVE COVENANT (“Deed”), made this ___ day of _________, 20__, by and between the CITY OF FORT COLLINS, COLORADO, a municipal corporation, whose mailing address for purposes of this Deed is P.O. Box 580, Fort Collins, Colorado 80522 (“Grantor”), and the LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado nonprofit corporation, whose mailing address for the purpose of this Deed is 1738 Bonny Dr., Loveland, CO 80538 (“Grantee”). W I T N E S S E T H : That Grantor, for and in consideration of the sum of ______ Dollars ($____.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and pursuant to Ordinance No. ___, 20__ approved and adopted by the Fort Collins City Council on ______________, 20__, and pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project, dated __________, 2020, hereby grants, sells, and conveys to Grantee that certain real property, together with all appurtenances and improvements, if any, situate, lying, and being in the County of Larimer, State of Colorado more particularly described in Exhibit A of Special Warranty Deed (Legal Description of the Property), attached hereto consisting of ____(xxx) page(s), and incorporated herein by this reference, which real property shall hereinafter be referred to as “Property”, but reserving unto the Grantor, its successors and assigns: 1) an access easement from the west, as described in Exhibit C of Special Warranty Deed (West Access Easement), attached hereto consisting of ____(xxx) page(s), and incorporated herein by this reference; 2) an easement along the North Fork of the Cache la Poudre River, as described in Exhibit D of Special Warranty Deed (River Access Easement), attached hereto consisting of ____(xxx) page(s), and incorporated herein by this reference; and 3) a restrictive covenant on the Property as described in Exhibit E of Special Warranty Deed (Restrictive Covenant), attached hereto, consisting of __ page(s), and incorporated herein by this reference. TO HAVE AND TO HOLD the Property with the appurtenances and improvements, unto Grantee, its successors and assigns forever. AND GRANTOR for itself, its successors and assigns, does covenant and agree that it shall and will WARRANT AND FOREVER DEFEND the above bargained Property in the quiet and peaceable possession of the Grantee, its successors and assigns, against all and every person or persons claiming the whole or any part thereof, by, through, or under Grantor, SUBJECT to the EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 2 of 35 matters set forth on Exhibit B attached hereto and incorporated herein by this reference (the “Permitted Exceptions”). IN WITNESS WHEREOF, the Grantor has executed this Special Warranty Deed on the date set forth above. GRANTOR: THE CITY OF FORT COLLINS, COLORADO a Municipal Corporation Date: _________________ By: Mayor ATTEST: City Clerk (Print Name) APPROVED AS TO FORM Assistant City Attorney (Print Name) EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 3 of 35 ACCEPTED BY GRANTEE: Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation Date: By: Brian T. Gray, President STATE OF COLORADO ) ) ss COUNTY OF ____________) The foregoing instrument was acknowledged before me this _______ day of ________, ______, by Brian T. Gray as President for the Landowners’ Association for Phantom Canyon Ranches. Witness my hand and official seal. My Commission expires: _______________________ Notary Public EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 4 of 35 EXHIBIT A OF SPECIAL WARRANTY DEED (Legal Description and Depiction of the Property) *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 5 of 35 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 6 of 35 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 7 of 35 EXHIBIT B OF SPECIAL WARRANTY DEED (Permitted Exceptions) EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 8 of 35 EXHIBIT C OF SPECIAL WARRANTY DEED (Retained West Access Easement) ACCESS EASEMENT FROM THE WEST WITH TERMS AND CONDITIONS (Phase 3 (Operations and Maintenance) of the Halligan Water Supply Project) (Halligan Reservoir and Dam) THIS OPERATIONS AND MAINTENANCE ACCESS EASEMENT DEED WITH TERMS AND CONDITIONS (“Easement”) is made and entered into this _____ day of ______________, 202____ (the “Effective Date”), by and between THE LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado nonprofit corporation (“LAPCR”), and THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”). RECITALS A. The City owns Halligan Reservoir (“Reservoir”), an on-channel reservoir generally located on the North Fork of the Cache la Poudre River (“North Fork”), in portions of Sections 29, 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M., as well as certain lands adjacent to the Reservoir. The visible portions of the Reservoir’s dam and outlet works are located on land owned by the City in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. B. The City has completed the Halligan Water Supply Project (“Halligan Project”). The Halligan Project included: the enlargement of the Reservoir, also known as North Poudre Reservoir No. 16, which primarily entailed replacing or enlarging the Reservoir’s dam (“Reservoir Dam”). The enlarged Reservoir is generally located in portions of Sections 27, 28, 29, 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M. The Reservoir Dam is generally located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. C. By Special Warranty Deed, Subject to Reserved Easements and Restrictive Covenant (“Deed”), to which this Easement is attached, the City has conveyed to LAPCR fee simple title to certain real property in Larimer County, Colorado (hereinafter the “LAPCR Property”). As set forth in the Deed, and as described in more detail herein, the City has reserved from the conveyance of the LAPCR Property, this Easement on, over and across the LAPCR Property as described more fully on Exhibit 1 of the West Access Easement (Legal Description of Easement Area), consisting of ____(_____) page(s), attached to and made a part of this Easement (the “Easement Area”). It is the express intent of the Parties that Easement Area shall be as defined herein, with the recognition that the Easement Area shall be: (1) the width of the roads that exist at the time Phase II (construction) of the Halligan Water Supply Project is completed, including any turnouts; and (2) an additional 15 feet of width from the edge of the roads on each side of the roads. The Easement described herein, encumbers and shall run with the LAPCR Property for the benefit of the City and its successors-in-interest. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 9 of 35 D. The City has retained certain real property adjacent to the LAPCR Property located in Larimer County, Colorado, which is legally described on Exhibit 2 of West Access Easement (Legal Description of Adjacent City Property), consisting of ___ (___) page(s) (the “City’s Property”) attached to and made a part of this Easement. E. The City will be responsible for various maintenance, operations, repairs, and other activities on the Reservoir, Dam, or City-owned lands, including various activities under different permits and approvals. This work and aspect of the Halligan Project is referred to as “Phase 3 (Operations and Maintenance).” F. This Easement is intended to document and provide for the City’s orderly use of the LAPCR Property during Phase 3 (Operations and Maintenance) for access to the Dam and to better protect LAPCR from the City’s use of the LAPCR Property. G. In exchange for the promises and consideration set forth in this Easement, the adequacy of which is hereby acknowledged, the City and LAPCR agree as follows. AGREEMENT AND EASEMENT 1. Purpose and Uses of Easement. This Easement shall be a perpetual, non-exclusive access easement and does not in any way grant any fee title or any other interest to the City except as set forth herein. The reservation of this Easement is for the benefit of the City’s Property. The City, and including its employees, agents, personnel, staff, contractors, service providers, successors, assigns, or any other person or entity that has the express permission of the City in connection with the Halligan Project (collectively the “City Parties”) may enter upon and use the Easement Area as required for the sole purpose of accessing the City’s Property and accessing the River Access Easement described in Exhibit D of the Deed. Said access may be conducted on foot and/or by vehicle subject to the further terms and conditions set forth herein. Such access shall be limited for the purposes required for Phase 3 (Operation and Maintenance) of the Halligan Project. 2. City’s Obligations a. The City will not install any improvements in the Easement Area beyond potential road improvements pursuant to Paragraph 2.h or repairs pursuant to Paragraph 2.i. b. Use of the Easement Area shall at all times be in conformity with all applicable laws, statutes, regulations and ordinances, including all environmental laws. c. The City’s access to the Easement Area must be scheduled and conducted so as to minimize, to the extent practicable, the impacts to the LAPCR Property and LAPCR’s use thereof. City personnel will notify LAPCR at least 24 hours in advance of any proposed visit via email and/or telephone. LAPCR will provide City personnel with an up-to-date, email and telephone number for such purposes. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 10 of 35 d. The City and City Parties shall not undertake any activity that would prevent access to LAPCR across the Easement Area or other LAPCR Property or violate LAPCR’s right of quiet enjoyment of the Easement Area or other LAPCR Property except to the extent the activities of the City or City Parties are authorized under this Easement. e. The City and City Parties will not use the Easement Area as a vehicle parking, equipment, or materials storage area. If any vehicle, equipment or materials are parked or stored on the Easement Area overnight without permission from LAPCR, then LAPCR, in its sole discretion, may have such vehicle, equipment or materials removed at the City’s sole cost and expense. f. The City and City Parties will only drive at reasonable speeds that do not create unsafe situations or damage the road. g. The City, at its sole cost and expense, must promptly repair any and all damage to the Easement Area, including the road and adjacent LAPCR Property, resulting from the City’s activities under this Easement, including activities of the City Parties, and return the Easement Area and LAPCR Property, including landscape, shrubs, trees, soil conditions, and other physical site conditions, to their original state existing prior to the damage, all to the reasonable satisfaction of LAPCR and at no cost to LAPCR. If the City fails to promptly make repairs to the Easement Area and/or LAPCR Property, LAPCR shall give to the City written notice of the required repairs and if such repairs are not completed by the City within thirty (30) days or, if such work cannot be reasonably completed in thirty (30) days, as soon as practicable thereafter, after notice of the required repairs is given to the City, LAPCR shall have the right to perform such repair work and shall be entitled to reimbursement from the City for all costs and expenses incurred by LAPCR in performing such repair work upon demand, together with interest on such amounts at the rate of 8% per annum from the date incurred by LAPCR until repaid by the City. Any work by the City in the Easement Area or on the LAPCR Property must be performed in a safe and sanitary manner and a good and workmanlike manner, and in compliance with all applicable laws. h. The City may not make any improvements to the Easement Area or LAPCR Property without the prior written consent of LAPCR, which consent may be granted or withheld in the sole and absolute discretion of LAPCR. 3. LAPCR’s Rights. LAPCR reserves the right to use and occupy the Easement Area for any purposes not inconsistent with the City’s rights granted in this Easement. 4. Maintenance of the Easement Area. a. LAPCR will not alter existing roadways in any way that might materially interfere with access by the City to the to the Reservoir Dam or North Fork. LAPCR will maintain the surface of the Easement Area to the same extent that LAPCR maintains its other roads. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 11 of 35 b. LAPCR and the City will not deposit, or permit or allow to be deposited, earth, rubbish, debris, or any other substance or material, whether combustible or noncombustible, on the Easement Area. 5. Enforcement. In the event that either party defaults in its obligations under this Easement, the defaulting party shall have thirty (30) days from the delivery of written notice of such default from the non-defaulting party in which to cure such default, or such longer period if the default is not able to reasonably be cured within such time period (the “Cure Period”). In the event that the defaulting party fails to cure the default within the Cure Period, then the non-defaulting party shall be entitled to bring an action for damages and/or negative or affirmative injunctive relief, and to seek any other right or remedy available at law or in equity. The failure to enforce any provision hereof shall not constitute a waiver of such provision or any right or remedy arising therefrom. 6. Representations of the City. The City states that it has good and lawful right and authority to reserve this Easement. 7. Insurance. The City shall maintain a comprehensive policy of general liability insurance covering the City’s use of the Easement Area under this Easement, insuring the City in an amount not less than One Million Dollars ($1,000,000.00) per occurrence, covering bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence. Such coverage must include, without limitation, the insured’s liability for property damage, bodily injuries, and death of persons in connection with the operation, maintenance, or use of the Easement Area and/or LAPCR Property (including acts or omissions of the City or of its officers, employees, agents or guests), and protection against liability for non-owned and hired automobiles and other vehicles or equipment. For each and every one of the City Parties using the Easement Area the City will provide to LAPCR prior to use of the Easement, or shall require the respective City Parties, to provide certificates of insurance for general liability policies, commercial automobile policies, and workers compensation policies. In the event the City fails or neglects to maintain, or require the City Parties to procure and maintain, as applicable, the insurance required by this paragraph, then LAPCR shall have the right to refuse entry to such party. 8. Additional Terms on the Use of the Property. a. Use of the LAPCR Property is subject to the Declaration of Easements, the Covenants, and the Rules and Regulations of LAPCR. b. The City shall be deemed to have accepted the Easement Area in its present condition, as is, where is, with all faults, patent and latent, without any representations or warranties whatsoever by LAPCR, its agents, guests or employees. The City assumes all risks associated with use of the Easement Area. The City acknowledges that neither LAPCR nor any of LAPCR’s agents have made any representations or warranties whatsoever regarding the Easement Area. The City assumes all risk that any adverse matter of whatever kind or nature including, but not limited to the physical condition of the Easement Area that may arise in the future. Except as stated otherwise in Paragraph 4.a, EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 12 of 35 LAPCR shall have no obligation to the City to maintain the Easement Area in its present condition or to improve the Property for the City’s use. c. To the extent permitted by law and without waiving its right to governmental immunity, the City shall be deemed to have released LAPCR, its officers, directors, members, guests, agents, and employees and their respective heirs, personal representatives, successors, and assigns (“Released/Indemnified Parties”) from and against any and all claims, demands, actions, suits, and proceedings of whatever kind or nature that the City may now have or may have at any time in the future arising out of or as a result of the present or any future condition of the Easement Area and LAPCR Property. d. To the extent permitted by law and without waiving its right to governmental immunity, the City shall defend, indemnify and hold harmless the Released/Indemnified Parties from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the use or misuse of the of the Easement Area by the City or the City Parties. To the extent permitted by law and without waiving its right to governmental immunity, the City shall also defend, indemnify and hold harmless the Released/Indemnified Parties and the LAPCR Property from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the any work performed on the Easement Area or LAPCR Property by the City, its agents, guests, employees, contractors, including but not limited to mechanic’s lien claims. e. Nothing herein shall be deemed to be a grant or dedication of any portion of the Easement Area or LAPCR Property to or for the general public, it being the intention of the parties hereto that this Easement be strictly limited to the purposes expressed herein. 9. Default and Litigation Expenses. If a party to this Easement is in default in performance of its respective obligations hereunder, the other party has the right to an action for specific performance or damages or both. Prior to proceeding with any such action, the party not in default must first send written notice to the defaulting party specifying the default and affording such party a reasonable period to cure the default, but in no event shall the period to cure the default extend beyond 90 days. In the event a party defaults in any of its covenants or obligations and the party not in default commences and substantially prevails in any legal or equitable action against the defaulting party, the defaulting party expressly agrees to pay all reasonable expenses of the litigation, including a reasonable sum for attorneys' fees or similar costs of legal representation. 10. Additional Terms and Conditions. Whenever used herein, the singular number includes the plural, the plural the singular; and the use of any gender is applicable to all genders. All of the covenants herein contained are binding upon and inure to the benefit of the parties hereto and their personal representatives, successors and assigns. If any term of this Easement is determined by any court to be unenforceable, the other terms of this Easement shall nonetheless remain in full force and effect; provided, however, that if the severance of any such provision materially alters the rights or obligations of the parties, the parties shall engage in good faith negotiations in order EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 13 of 35 to adopt mutually agreeable amendments to this Easement as may be necessary to restore the parties as closely as possible to the initially agreed upon relative rights and obligations. TO HAVE AND TO HOLD unto the Grantee and its successors and assigns forever. [Remainder of Page Intentionally Blank] EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 14 of 35 Exhibit 1 of West Access Easement (Legal Description and Depiction of Easement Area) *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 15 of 35 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 16 of 35 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 17 of 35 Exhibit 2 of West Access Easement (Legal Description of Adjacent City Property) * Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 18 of 35 EXHIBIT D OF SPECIAL WARRANTY DEED (Retained River Access Easement) RIVER ACCESS EASEMENT WITH TERMS AND CONDITIONS (Phase 3 (Operations and Maintenance) of the Halligan Water Supply Project) (Access to North Fork of the Cache la Poudre River) THIS RIVER ACCESS EASEMENT DEED WITH TERMS AND CONDITIONS (“Easement”) is made and entered into this _____ day of ______________, 2020 (the “Effective Date”), by and between The Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation (“LAPCR”), and THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”). RECITALS A. The City has completed the Halligan Water Supply Project (“Halligan Project”). The Halligan Project included: the enlargement of Halligan Reservoir, also known as North Poudre Reservoir No. 16 (“Reservoir”), which primarily entailed replacing or enlarging the Reservoir’s dam (“Reservoir Dam”);0F 1 and the replacement of the diversion structure for the North Poudre Canal and related infrastructure (“Diversion Structure”)1F 2 on the North Fork of the Cache la Poudre River (“North Fork”). The Diversion Structure and portions of the North Fork are located on land owned by LAPCR. B. By the Special Warranty Deed, Subject to Reserved Easements and Restrictive Covenant (“Deed”), to which this Easement is attached, the City has conveyed to LAPCR fee simple title to certain real property in Larimer County, Colorado (hereinafter the “LAPCR Property”). As set forth in the Deed, and as described in more detail herein, the City has reserved from the conveyance of the LAPCR Property, this Easement on, over and across the LAPCR Property as described more fully on Exhibit 1 of River Access Easement (Legal Description of Easement Area), consisting of ____(_____) page(s), attached to and made a part of this Easement (the “Easement Area”). The Easement is on, over, and across the North Fork, including its bed and fifty (50) horizontal feet from the then-existing water line along each of its banks, where it crosses the LAPCR Property. It is the express intent of the Parties that Easement Area shall be as defined herein, with the recognition that: (1) the Easement Area’s specific width will fluctuate as the waters of the North Fork rise and fall, with the Parties’ intent being that the TAE Area’s specific width at any given time be the sum of fifty (50) horizontal feet on one bank plus the actual width of the North Fork between its water lines plus (50) horizontal feet on the other bank; and (2) the Easement Area’s specific location on the Property will move with the North Fork as it moves due to erosion, deposition, and other forces, with the Parties’ intent being that the Easement Area’s specific location 1 The Reservoir is an on-channel reservoir located on the North Fork, in portions of Sections 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M. The Reservoir Dam is located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. 2 The Diversion Structure is located in the North Fork in the SE1/4 of Section 12, Township 10 North, Range 71 West of the 6th P.M. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 19 of 35 move with the actual location of the North Fork, provided however, that the Easement Area not extend farther up or downstream. C. The Easement described herein, encumbers and shall run with the LAPCR Property for the benefit of the City and its successors-in-interest. The non-exclusive Easement described herein, encumbers, and shall run with the Property for the benefit of the City and its successors-in-interest. D. The City will be responsible, among other things, for the permanent maintenance of measuring devices on the North Fork to satisfy environmental monitoring requirements under the governmental permits and approvals. The City will also need access for surveys and sampling below the Reservoir Dam and along the North Fork to monitor the long-term effects of the Reservoir enlargement. This work and aspect of the Halligan Project is referred to as “Phase 3 (Operation and Maintenance).” E. As part of Phase 3 (Operations and Maintenance) of the Halligan Project, City personnel and certain other people associated with the Halligan Project (which people are identified below) need to cross the LAPCR Property in the Easement Area to access the North Fork for certain limited purposes described herein. F. This Easement is intended to document and provide for the City’s orderly use of the LAPCR Property in the Easement Area during Phase 3 (Operations and Maintenance) for access to the North Fork and to better protect LAPCR from the City’s use of the Property. As set forth below, the City is reserving access across the Property for Phase 3 (Operations and Maintenance), pursuant to the terms and conditions of this Easement. G. In exchange for the promises and considerations set forth in this Easement, the adequacy of which is hereby acknowledged, the City and LAPCR agree as follows. AGREEMENT AND EASEMENT 1. Purpose and Uses of Easement. This Easement shall be a perpetual non-exclusive access easement and does not in any way grant any fee title or any other interest to the City except as set forth herein. The City has reserved the Easement for the sole purposes of: habitat evaluation studies, such as fish and macroinvertebrate surveys; topographic and geomorphic surveys; water quality and other environmental sampling; and other site visits, studies, and investigations as required of the City in association with the Halligan Project (collectively the “Easement Purpose”). The City’s use of the Easement Area must be directly related to the Halligan Project as further described in this Paragraph 1. The City’s use of the Easement Area must only be between the hours of 8AM and sunset, Monday through Friday, not including federal holidays. The City’s use of the Easement Area must only be by foot or non-motorized boat. The City is hereby authorized to access the Easement Area only to gain entrance to the North Fork for site visits and data collection in connection with the Easement Purpose. City personnel may bring only the following guests with them during site visits: personnel from and consultants for governmental agencies involved in the various permitting, approval, and monitoring processes for the Halligan Project including but not limited to: the U.S. Army Corps EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 20 of 35 of Engineers, U.S. Fish and Wildlife Service, Colorado State Engineer’s Office, Colorado Department of Public Health and Environment, and Colorado Parks and Wildlife (the “City Parties”). On most occasions the City Parties will be accompanied by City personnel. Nevertheless, a City Party working on the City’s behalf access may access the Easement Area without the presence of City personnel for purposes of Phase 3 (Operations and Maintenance) of the Halligan Project. Nothing in this Easement shall be construed to create a right to access the Easement Area for any person or entity other than the City or City Parties. The City’s use of this Easement shall be limited in scope and time to only certain days and certain time which are required to meet any legal or regulatory requirements, including compliance monitoring and other requirements of permits and approvals associated with the Halligan Project and the City’s water utility. 2. City’s Obligations a. The City and City Parties will not install any improvements in the Easement Area, provided that the City and Cities Parties may install small equipment (e.g., ground water monitoring wells, data recorders, location markers) required to meet any legal or regulatory requirements, including compliance monitoring and other requirements of permits and approvals associated with the Halligan Project and the City’s water utility, provided further that such equipment is installed by hand or manual tools. b. Use of the Easement Area shall at all times be in conformity with all applicable laws, statutes, regulations and ordinances, including environmental laws. c. The City’s access to the Easement Area must be scheduled and conducted so as to minimize, to the extent practicable, the impacts to the Property and LAPCR’s use thereof. City personnel will notify LAPCR at least 24 hours in advance of any proposed data collection or site visit via email and/or telephone. LAPCR will provide City personnel with an up-to-date, email and telephone number for such purposes. d. The City may reach the Easement Area from either (i) adjacent real property owned by the City, or (ii) the west access easement reserved by the City over the LAPCR Property. In the event that the City is unable to access the Easement Area from either (i) or (ii) herein, then the City is solely responsible for acquiring access across such other lands in order to reach and use the Easement Area under this Easement. e. The City or City Parties shall not undertake any activity that would prevent access to LAPCR across the Easement Area or violate LAPCR’s right of quiet enjoyment of the LAPCR Property. f. The City, at its sole cost and expense, must promptly repair any and all damage to the Easement Area resulting from the City’s activities under this Easement, including activities of the City Parties, and return the Easement Area and LAPCR Property, including landscape, shrubs, trees, soil conditions, and other physical site conditions, to their original state existing prior to the damage, all to the reasonable satisfaction of LAPCR, and at no cost to LAPCR. If the City fails to promptly make repairs to the Easement Area and/or EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 21 of 35 LAPCR Property, LAPCR shall give to the City written notice of the required repairs. If such repairs are not completed by the City within thirty (30) days or, if such work cannot be reasonably completed in thirty (30) days, as soon as practicable thereafter, LAPCR shall have the right to perform such repair work. In such an event, LAPCR shall be entitled to reimbursement from the City for all costs and expenses incurred by LAPCR in performing such repair work upon demand, together with interest on such amounts at the rate of 8% per annum from the date incurred by LAPCR until repaid by the City. Any work by the City in the Easement Area or on the LAPCR Property must be performed in a safe and sanitary manner and a good and workmanlike manner, and in compliance with all applicable laws. 3. LAPCR’s Rights. LAPCR reserves the right to use the Easement Area for any purposes not inconsistent with the City’s rights reserved in this Easement. LAPCR will not erect or construct any structure or improvement, or drill or operate any well, construct any reservoir or impoundment or other obstruction, install or plant any trees or woody shrubs, or otherwise improve the Easement Area or change the ground level in the Easement Area during the term of this Easement without the prior written consent of the City, which such consent shall not be unreasonably withheld. 4. Maintenance of the Easement Area. a. LAPCR is not responsible for any conditions directly caused by the City’s or City Parties’ use and occupancy of the Easement Area. b. LAPCR and the City will not deposit, or permit or allow to be deposited, earth, rubbish, debris, or any other substance or material, whether combustible or noncombustible, on the Easement Area. 5. Enforcement. In the event of any violation of the terms of this Easement, each party shall be entitled to bring an action for damages and/or negative or affirmative injunctive relief, and to seek any other right or remedy available at law or in equity. The failure of either party to enforce any provision hereof shall not constitute a waiver of such provision or any right or remedy arising therefrom. 6. Representations of the City. The City states that it has good and lawful right and authority to reserve this Easement. 7. Insurance. The City shall maintain a comprehensive policy of general liability insurance covering the City’s use of the LAPCR Property under this Easement and insuring the City in an amount not less than One Million Dollars ($1,000,000.00) per occurrence covering bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence. Such coverage must include, without limitation, the insured’s liability for property damage, bodily injuries, and death of persons in connection with the operation, maintenance, or use of the LAPCR Property (including acts or omissions of the City or of its officers, employees, agents or guests), and protection against liability for non-owned and hired automobiles and other vehicles or equipment. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 22 of 35 For each and every one of the City Parties using the Easement Area, the City will provide to LAPCR prior to use of the Easement, or shall require the respective City Parties to provide certificates of insurance for general liability policies, commercial automobile policies and workers compensation policies. In the event the City fails or neglects to maintain, or to require its contractors to procure and maintain, as applicable, the insurance required by this paragraph, then LAPCR shall have the right to refuse entry to such contractor. 8. Additional Terms on the Use of the Property. a. Use of the Property is subject to the Declaration of Easements, the Covenants, and the Rules and Regulations of LAPCR. b. The City shall be deemed to have accepted the Easement Area in its present condition, as is, where is, with all faults, patent and latent, without any representations or warranties whatsoever by LAPCR, its agents or employees. The City assumes all risks associated with use of the Easement Area. The City acknowledges that neither LAPCR nor any of LAPCR’s agents have made any representations or warranties whatsoever regarding the Easement Area. The City assumes all risk that any adverse matter of whatever kind or nature including, but not limited to the physical condition of the Easement Area or LAPCR Property that may arise in the future. LAPCR shall have no obligation to the City to maintain the Easement Area in its present condition or to improve the Easement Area for the City’s use. c. To the extent permitted by law and without waiving its right to governmental immunity, the City shall be deemed to have released LAPCR, its officers, directors, members, agents, guests and employees and their respective heirs, personal representatives, successors, and assigns (“Released/Indemnified Parties”) from and against any and all claims, demands, actions, suits, and proceedings of whatever kind or nature that the City may now have or may have at any time in the future arising out of or as a result of the present or any future condition of the Easement Area and LAPCR Property. d. To the extent permitted by law and without waiving its right to governmental immunity, the City shall defend, indemnify and hold harmless the Released/Indemnified Parties from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the use or misuse of the Easement Area by the City or City Parties. To the extent permitted by law and without waiving its right to governmental immunity, the City shall also defend, indemnify and hold harmless the Released/Indemnified Parties and the LAPCR Property from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the any work performed on the Easement Area or LAPCR Property by the City, its agents, employees, contractors, including but not limited to mechanic’s lien claims. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 23 of 35 e. Nothing herein shall be deemed to be a grant or dedication of any portion of the Easement Area or LAPCR Property to or for the general public, it being the intention of the parties hereto that this Easement be strictly limited to the purposes expressed herein. 9. Default and Litigation Expenses. If a party to this Easement is in default in performance of its respective obligations hereunder, the non-defaulting party has the right to an action for specific performance or damages or both. Prior to proceeding with any such action, the non- defaulting party must first send written notice to the defaulting party specifying the default and affording such party a reasonable period to cure the default, but in no event shall the period to cure the default extend beyond 45 days. In the event a party defaults in any of its covenants or obligations and the non-defaulting party commences and substantially prevails in any legal or equitable action against the defaulting party, the defaulting party expressly agrees to pay all reasonable expenses of the litigation, including a reasonable sum for attorneys' fees or similar costs of legal representation. 10. Additional Terms and Conditions. Whenever used herein, the singular number includes the plural, the plural the singular; and the use of any gender is applicable to all genders. All of the covenants herein contained are binding upon and inure to the benefit of the parties hereto and their personal representatives, successors and assigns. If any term of this Easement is determined by any court to be unenforceable, the other terms of this Easement shall nonetheless remain in full force and effect; provided, however, that if the severance of any such provision materially alters the rights or obligations of the parties, the parties shall engage in good faith negotiations in order to adopt mutually agreeable amendments to this Easement as may be necessary to restore the parties as closely as possible to the initially agreed upon relative rights and obligations. TO HAVE AND TO HOLD unto the City and its successors and assigns forever. [Remainder of Page Intentionally Blank] EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 24 of 35 Exhibit 1 of River Access Easement (Legal Description and Depiction of Easement Area) * Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 25 of 35 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 26 of 35 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 27 of 35 EXHIBIT E OF SPECIAL WARRANTY DEED (Restrictive Covenant) DECLARATION OF RESTRICTIVE COVENANT THIS DECLARATION OF RESTRICTIVE COVENANT (“Covenant”) is made this _____ day of ____________, 202_, by the LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, INC., a Colorado nonprofit corporation (“LAPCR”), in favor of the CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”). R E C I T A L S : WHEREAS, by the Special Warranty Deed, Subject to Reserved Easements and Restrictive Covenant (“Deed”), to which this Covenant is attached, the City has conveyed to LAPCR fee simple title to certain real property described on Exhibit A of the Special Warranty Deed (hereinafter the “Property”). As set forth in the Deed, and as described in more detail herein, the City has reserved from the conveyance of the Property, the Covenant described herein, which encumbers and shall run with the Property for the benefit of the City and its successors-in-interest. This Covenant is subject to additional reservations by the City of two access easements that are also attached to the Deed, namely the “West Access Easement” and the “River Access Easement” which easements convey certain access rights to the City over the Property. WHEREAS, the Property possesses natural, scenic, and open space values (collectively, “Conservation Values”) of great importance to LAPCR, the City, and the people of Larimer County. WHEREAS, this Covenant shall encumber and run with the Property for the benefit of the City and its successors in interest. WHEREAS, the Conservation Values of the Property include views of the mountain backdrop to Halligan Reservoir and surrounding foothills, wildlife habitat, and the aesthetic value as open space. WHEREAS, LAPCR and the City desire to place a Covenant upon the Property for the purpose of protecting the Conservation Values. NOW, THEREFORE, in consideration of the above and the mutual covenants, terms, conditions, and restrictions contained herein and pursuant to the laws of the State of Colorado, the LAPCR and the City, on behalf of themselves and their successors and assigns, hereby acknowledge and agree to the following Covenant in perpetuity over the Property of the nature and character and to the extent hereinafter set forth. 1. Purpose. The purpose of this Covenant is to ensure that the Property will be retained predominately for its Conservation Values and for water utility purposes related to Halligan Reservoir, and to prevent any use of the Property that will significantly impair or interfere with the Conservation Values. The Covenant will facilitate meeting the terms and conditions of EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 28 of 35 approval and permits needed for the enlargement of Halligan Reservoir, including mitigation- related items, and to help maintain the quality of water in the North Fork of the Cache la Poudre River, which is beneficial to the City and its water utility for various reasons and purposes. The City intends that this Covenant will restrict the use of the Property to activities that are consistent with the Conservation Values. The Property shall not be used for activities that significantly diminish the Conservation Values. These covenants, conditions and restrictions are hereby imposed on the Property. 2. Submission of Property to Restrictive Covenants. The City hereby impresses and imposes upon the Property the covenants, conditions, and restrictions set forth and provided for herein. This Covenant shall be binding upon LAPCR, its successors, assigns, and grantees. The Property shall be held, sold and conveyed subject to all of the covenants, conditions, and restrictions set forth herein, which will run with the land and title, and the grantee of any deed conveying the Property or any portion thereof will be deemed by the acceptance of such deed to have agreed to all such covenants, conditions, and restrictions, and to have covenanted to observe, comply with and be bound by all such covenants, conditions and restrictions. 3. Use and Management of the Property. The City shall be entitled to use the Property only in accordance with the West Access Easement and the River Access Easement. The City’s use of the Property in accordance with the West Access Easement and River Access Easement is subject to all terms and obligations contained in this Covenant. LAPCR, its successors, assigns, and grantees shall be entitled to own and use the Property for all activities that are not materially inconsistent with the purposes of this Covenant and subject to any applicable terms and conditions set forth below in the following subparagraphs: a. No Structures or Development. No structures shall be permitted on the Property, except for those in the River Access Easement Area that are required for the Halligan Project (e.g., ground water monitoring wells and data loggers). No development of the Property for commercial, industrial, or residential purposes shall be allowed. b. Motorized Vehicles. Use of motorized vehicles on the Property shall be limited to the Easement Areas identified in the West Access Easement and any parking areas designated by LAPCR, its successors, assigns, and grantees, except as needed for maintenance, emergencies, monitoring, and enforcement, or as required for compliance with the Americans with Disabilities Act or similar laws. c. Fences. Any existing fences may be repaired or replaced, and new fences may be built for purposes of reasonable and customary management of livestock and wildlife. All new fences shall be designed and constructed to be friendly to wildlife, such as, for example only, those identified by the Colorado Division of Parks and Wildlife wildlife-friendly fencing design standards. d. Subdivision. No division or subdivision of title to the Property is permitted. Nothing in this subparagraph shall be construed to prohibit joint ownership of the Property or ownership of the Property by an entity consisting of more than one member. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 29 of 35 e. Grazing. Livestock grazing may occur only in accordance with sound stewardship and management practices, such as, for example only, those in the Natural Resources Conservation Service Field Office Technical Guide. For purposes of this Covenant, “livestock” shall mean cattle, horses, llamas, alpaca, and bison. No domesticated sheep or goats shall be allowed to graze. f. Trash and Storage of Materials. The dumping or uncontained accumulation of any kind of trash or refuse on the Property, including but not limited to household trash and hazardous chemicals, is strictly prohibited. No storage of any vehicles, trailers, boats, etc. is allowed. g. Mineral Rights. LAPCR, its successors, assigns, and grantees shall not develop, or lease or sell to others for development, any mineral rights associated with Property without the written consent of the City. LAPCR, its successors, assigns, and grantees, may impose additional limits and restrictions on the use of the Property provided that they do not materially impact the City’s rights to use the Property (including those reserved under the West Access Easement or River Access Easement) and that they are otherwise consistent with applicable law. 4. Reserved Rights. Subject to interpretation under Paragraph 16, LAPCR reserves unto itself, and to its beneficiaries, trustees, successors, and assigns, all rights accruing from its ownership of the Property, including the right to engage in or permit or invite others to engage in all uses of the Property that are not specifically prohibited or inconsistent with any of the purposes of the Covenant or with the conditions, restrictions or other terms of this Covenant. 5. Rights of City. To accomplish the purposes of the Covenant, LAPCR conveys to the City the right to proceed at law or in equity to enforce the provisions of this Covenant, to prevent the occurrence of any of the prohibited activities set forth herein, and to require the restoration of areas or features of the Property that may be damaged by any activity inconsistent with this Covenant. 6. Enforcement. a. If the City finds what it believes is a violation of this Covenant, the City shall notify LAPCR in writing of the nature of the alleged violation. Upon receipt of this written notice, LAPCR shall either: (a) restore the Property to its condition prior to the violation; or (b) provide a written explanation to the City of the reason why the alleged violation should be permitted. b. In the event that the parties are in dispute as to the actions required of the LAPCR hereunder, LAPCR and City will meet as soon as possible to resolve the difference. If either LAPCR or the City determine that mediation would be advantageous in connection with such meeting, or if a resolution of this difference cannot be achieved at the meeting, both parties agree to attempt to resolve the dispute through the process described in Paragraph 18.m. Should the parties fail to resolve the dispute, or if, in the City’s opinion, an ongoing or imminent violation could irreversibly diminish or impair the Conservation Values of the Property or will not otherwise be resolved in a sufficiently prompt and EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 30 of 35 effective manner, the City may, at its discretion, take such legal action and seek such legal or equitable remedies as it determines to be appropriate or necessary, regardless of whether a dispute resolution process has been initiated or completed. Such remedies may include, without limitation, an injunction to stop an alleged violation, temporarily or permanently, or an order requiring LAPCR to restore the Property to its condition prior to the alleged violation. LAPCR shall discontinue any activity which could increase or expand the alleged violation during any dispute resolution process or any legal proceeding pertaining to the alleged violation. c. The City may enforce the terms of this Covenant at its discretion, but if LAPCR, or its successors or assigns, breach any term of this Covenant and the City does not exercise its rights under this Covenant, the City’s forbearance shall not be construed to be a waiver by the City of such term, or of any subsequent breach of the same or any other term of this Covenant, or of any of the City’s rights under this Covenant. No delay or omission by the City in the exercise of any right or remedy upon any breach by LAPCR shall impair such right or remedy or be construed as a waiver. The City shall not be obligated to LAPCR, or to any other person or entity, to enforce the provisions of this Covenant. 7. Costs of Enforcement. Any costs reasonably incurred by the City in enforcing a breach of the terms of this Covenant against LAPCR, including, without limitation, costs of suit and reasonable attorneys' fees, and any costs of restoration necessitated by LAPCR’s violation of the terms of this Covenant, shall be borne by LAPCR. If LAPCR prevail in any action to enforce an alleged breach of the terms of this Covenant, LAPCR’s costs of suit, including, without limitation, reasonable attorneys' fees, shall be borne by the City. 8. Intentionally Omitted. 9. Acts Beyond LAPCR’s Control. Nothing contained in this Covenant shall be construed to entitle the City to bring any action against LAPCR for any injury to or change in the Property resulting from causes beyond LAPCR’s control, including, without limitation, fire, flood, drought, storm, landslides and seismic activity, or from any prudent action taken by LAPCR under emergency conditions to prevent, abate, or mitigate significant injury to the Property resulting from such causes. 10. Access. No right of access by the general public to any portion of the Property is conveyed to the City by this Covenant. 11. Costs and Liabilities. LAPCR retains all responsibilities and shall bear all costs and liabilities of any kind related to the ownership, operation, upkeep, repair, and maintenance of the Property, including the maintenance of adequate comprehensive general liability insurance coverage. LAPCR shall keep the Property free of any liens arising out of any work performed for, materials furnished to, or obligations incurred by LAPCR. No provision of this Covenant shall be construed as impairing the ability of LAPCR to use the Property as collateral for borrowing, provided that any mortgage or lien arising from such borrowing is expressly subordinated to this Covenant. EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 31 of 35 12. Taxes. Intentionally Omitted. 13. Liability. a. General Indemnification. LAPCR is responsible for its own negligence and that of its officers, employees, and agents. Nothing in this Covenant shall be construed as giving rise to any right or ability in, nor shall the City have any right or ability to exercise physical or managerial control over the day-to-day operations of the Property, or otherwise to become an operator with respect to the Property within the meaning of The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended. b. No Waiver of Governmental Immunity. Anything else in this Covenant to the contrary notwithstanding, no term or condition of this Covenant shall be construed or interpreted as a waiver, either express or implied, of any of the immunities, rights, benefits or protection provided to the City under the Colorado Governmental Immunity Act as amended or as may be amended in the future (including, without limitation, any amendments to such statute, or under any similar statute which is subsequently enacted), subject to any applicable provisions of the Colorado Constitution and applicable laws. 14. Environmental Warranty and Indemnification. To the best of LAPCR’s knowledge, LAPCR represents that it is in compliance with, and shall remain in compliance with, all applicable Environmental Laws. LAPCR warrants that there are no notices by any governmental authority of any violation or alleged violation of, non-compliance or alleged non-compliance with or any liability under any Environmental Law relating to the operations or conditions of the Property. LAPCR further warrants that it has no actual knowledge of a release or threatened release of Hazardous Materials, as such substances and wastes are defined by applicable federal and state law. “Environmental Law” or “Environmental Laws” means any and all Federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, guidelines, policies or requirements of any governmental authority regulating or imposing standards of liability or standards of conduct (including common law) concerning air, water, solid waste, hazardous materials, worker and community right-to-know, hazard communication, noise, radioactive material, resource protection, subdivision, inland wetlands and watercourses, health protection and similar environmental health, safety, building and land use as may now or at any time hereafter be in effect. “Hazardous Materials” means any petroleum, petroleum products, fuel oil, waste oils, explosives, reactive materials, ignitable materials, corrosive materials, hazardous chemicals, hazardous wastes, hazardous substances, extremely hazardous substances, toxic substances, toxic chemicals, radioactive materials, infectious materials and any other element, compound, mixture, solution or substance which may pose a present or potential hazard to human health or the environment.” EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 32 of 35 15. Recordation/Subsequent Transfers. The City shall record this instrument in timely fashion in the official records of Larimer County, and may re-record it at any time as may be required to preserve its rights in this Covenant. The LAPCR will notify the City in advance of the proposed conveyance of any interest in all or any portion of the Property, and shall incorporate the terms of the Covenant in any deed, Covenant or other legal instrument by which it divests itself of any interest in all or a portion of the Property, except that for any lease the LAPCR need not incorporate the terms of the Covenant into such lease, but must notify all tenants in writing of this Covenant and advise such tenants that their lease is subject to the terms of this Covenant. The LAPCR further agrees to give written notice to the City of the proposed transfer of any interest at least thirty (30) days prior to the LAPCR’s creation of a legal obligation to carry out any such transfer. The failure of the City or LAPCR to perform any act required by this paragraph shall not impair the validity of the Covenant or limit its enforceability in any way. 16. Representations of the City. The City states that it has good and lawful right and authority to subject the Property to this Covenant. 17. Interpretation. This Covenant shall be interpreted under the laws of the State of Colorado, resolving any ambiguities and questions of the validity of specific provisions so as to preserve the Conservation Values and give maximum effect to its conservation purposes. 18. Notices. Any notice, demand, request, consent, approval, or communication that either party desires or is required to give to the other under this Covenant shall be in writing and either served personally or sent by first class mail, postage prepaid, or by overnight commercial courier, addressed as follows and shall be deemed given when personally served, on the day after being sent by courier, or on the third business day after being mailed: If to the LAPCR: Landowners Assoc. for Phantom Canyon Ranches Attn: Brian T. Gray, President 1738 Bonny Drive Loveland, CO 80538 (704) 614-7770 btgray@att.net With copy to: Registered Agent on File with Colorado Secretary of State If to the City: Fort Collins Utilities Attn: Halligan Water Supply Project Manager P.O. Box 580 700 Wood St. Fort Collins, CO 80522 With Copies to: Real Estate Services Manager City of Fort Collins Mailing Address: P.O. Box 580 EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 33 of 35 Fort Collins, CO 80522-0580 Hand Delivery: 117 North Mason St. Fort Collins, CO 80524 City Attorney’s Office City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 300 LaPorte Avenue Fort Collins, CO 80521 or to such other address as any party from time to time shall designate by written notice to the others. 19. General Provisions. a. Controlling Law. The interpretation and performance of this Covenant shall be governed by the laws of the State of Colorado. b. Liberal construction. Any general rule of construction to the contrary notwithstanding, this Covenant shall be liberally construed in favor of the grant to affect the purpose of the Covenant. If any provision in this Covenant is found to be ambiguous, an interpretation consistent with the purposes of the Covenant that would render the provision valid shall be favored over any interpretation that would render it invalid. c. Severability. If any provision of this Covenant or application thereof to any person or circumstance is found to be invalid, the remainder of the provisions of this Covenant, or the application of such provision to persons or circumstances other than those as to which it is found to be invalid, as the case may be, shall not be affected thereby. d. Entire Agreement. This Covenant sets forth the entire agreement of the parties with respect to the matters described herein, and supersedes all prior discussions, negotiations, understandings, or agreements relating to the Covenant, all of which are merged herein. e. No Forfeiture. Nothing contained herein shall result in a forfeiture of LAPCR’s fee title to the Property. f. Joint Obligation. In the event that there is more than one owner of the Property at any time, the obligations imposed by this Covenant upon LAPCR shall be joint and several upon each of the owners of the Property. g. Successors; Third Party Beneficiaries. The covenants, terms, conditions, and restrictions of this Covenant shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, beneficiaries, trustees, successors, and assigns and shall continue as a servitude running in perpetuity with the Property. It is expressly understood and agreed that the enforcement of the terms and conditions of this Covenant and all rights EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 34 of 35 of action relating to such enforcement, shall be strictly reserved to the parties and that nothing contained in this Covenant shall give or allow any claim or right of action whatsoever by any other third person. It is the express intention of the parties that any person or entity, other than the parties, receiving services or benefits under this Covenant shall be deemed an incidental beneficiary only. h. Termination of Rights and Obligations. A party’s rights and obligations under this Covenant terminate upon transfer of the party's interest in the Covenant or the Property, except for any unpaid financial obligations of one party to the other which were owed prior to the date of such transfer under this Covenant. i. Captions. The captions in this instrument have been inserted solely for convenience of reference and are not a part of this instrument and shall have no effect upon construction or interpretation. j. Amendment. If the circumstances arise under which an amendment to or modification of this Covenant would be appropriate, LAPCR and the City are free to jointly amend this Covenant. Any amendment must be consistent with the conservation purposes of this Covenant. Any amendment must be in writing, signed by the duly authorized officials of each affected party, and recorded in the records of the Clerk and Recorder of Larimer County. k. Change of Conditions. A change in the potential economic value of any use that is prohibited by or inconsistent with this Covenant, or a change in any current or future uses of neighboring properties, shall not by itself constitute a change in conditions that makes it impossible or impractical for continued use of the Property for conservation purposes and shall not constitute grounds for terminating the Covenant. l. Obligations Subject to Appropriation. The City’s obligations under this Covenant for subsequent fiscal years are subject to the annual appropriation by the City Council of the City of Fort Collins, in its sole discretion, of funds sufficient and intended for such purposes. m. Good Faith Negotiation/Mediation. Where this Covenant specifies that a decision requires the mutual agreement of the parties, the parties shall be obligated to make best efforts to negotiate in good faith to reach mutual agreement consistent with the Conservation Values and purposes of the Covenant. In the event that such efforts by the parties fail to result in mutual agreement through negotiation, the parties agree to attempt to resolve their dispute through mediation. Either party may commence the mediation process by providing the other party with written notice setting forth the subject of the dispute, and the solution requested. Within ten (10) days after the receipt of the notice, the other party shall deliver a written response to the initiating party’s notice. The parties agree to meet with a mutually acceptable mediator to attempt to resolve the dispute. The initial mediation session shall be held within thirty (30) days after the initial notice, unless the selected mediator cannot accommodate the parties within that time. If the parties cannot agree upon a mediator, the City will provide LAPCR with a list of at least three professional EXHIBIT A Exhibit D-1 to Agreement Regarding the Halligan Water Supply Project Page 35 of 35 mediation organizations in the Fort Collins/Denver area that are not affiliated with the City of Fort Collins. LAPCR will select an organization from the list within ten (10) days of receipt of the list, and the selected organization will be asked to choose a mediator for the parties. The parties agree to share equally the costs and expenses of the mediation, which shall not include the expenses incurred by each party for its own legal representation in connection with the mediation. The provisions of this subparagraph may be enforced by any court of competent jurisdiction, and the party seeking enforcement shall be entitled to an award of all costs, fees and expenses, including reasonable attorneys’ fees and other legal costs, to be paid by the party against whom enforcement is ordered. TO HAVE AND TO HOLD unto the City and its successors and assigns forever. [Remainder of Page Intentionally Blank] EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 1 of 13 EASEMENT DEED WITH TERMS AND CONDITIONS (Access for LAPCR to North Fork of the Cache la Poudre River South of Halligan Dam) THIS EASEMENT DEED WITH TERMS AND CONDITIONS (“Easement Deed”) is made and entered into this _____ day of ____________, 20__ (the “Effective Date”), by and between THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”), and THE LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado nonprofit corporation (“LAPCR”). 1. City’s Property. The City is the owner of that certain parcel of real property located in Larimer County, Colorado, which is legally described on Exhibit A, consisting of [____] page(s), attached to and made a part of this Easement Deed (“City Property”). The City Property is adjacent to Halligan Reservoir. In this Easement Deed, “Halligan Reservoir” refers to that reservoir as enlarged.0F 1 2. LAPCR’s Property. LAPCR is the owner of that certain parcel of real property located in Larimer County, Colorado, which is legally described on Exhibit B, consisting of [___] page(s), attached to and made a part of this Easement Deed (“LAPCR Property”). 3. Grant of Easement. The City hereby grants to LAPCR, its members and guests, and LAPCR’s successors in ownership of the LAPCR Property, a perpetual access easement on, over, and across the North Fork of the Cache la Poudre River (the “North Fork”), including its bed and fifty (50) horizontal feet from the high water line along each of its banks (the “Easement”) where the North Fork runs over and across the City Property, immediately south of the Halligan Reservoir dam in Section 34, all in Township 11 North, Range 71 West of the 6th P.M. as described more fully on Exhibit C, consisting of _____ page(s), attached to and made a part of this Easement Deed (the “Easement Area”), for the benefit of LAPCR Property, subject to the conditions and restrictions set forth below. It is the express intent of the Parties that Easement Area shall be as defined herein, with the recognition that: (1) the Easement Area’s specific width will fluctuate as the waters of the North Fork rise and fall, with the Parties’ intent being that the TAE Area’s specific width at any given time be the sum of fifty (50) horizontal feet on one bank plus the actual width of the North Fork between its high water lines plus (50) horizontal feet on the other bank; and (2) the Easement Area’s specific location on the Property will move with the North Fork as it moves due to erosion, deposition, and other forces, with the Parties’ intent being that the Easement Area’s specific location move with the actual location of the North Fork, provided, however, that the Easement Area not extend farther up or downstream. 4. Purpose of Easement. The Easement shall be limited to foot traffic for recreational purposes, for example: hiking, fishing, and bird watching. No hunting is allowed on the City Property. Vehicular access and motorized access of any kind without the City’s prior consent are prohibited. 1 Halligan Reservoir is generally located in portions of Sections 27, 28, 29, 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M. The Reservoir Dam is generally located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 2 of 13 5. Halligan Reservoir. Use of the City Property by LAPCR shall not interfere with use of the City Property by the City in connection with the maintenance, operation, and repair of Halligan Reservoir and related infrastructure by the City including construction-related activities and non- construction-related activities, including: repair, maintenance, inspections, or other necessary work to maintain infrastructure, creation of material stockpiles (such as from dredging and other work); outlet works/stilling basin work; stream gage-related work; wetland, vegetation, and/or habitat reestablishment; and fencing off certain sensitive areas from access by the LAPCR in association with mitigation or other permitting requirements, such as wetland and vegetation reestablishment areas. Because the Easement Area is close in proximity to the Halligan Reservoir dam, where maintenance, repair, replacement, and operation activities will occur, access under this Easement will be limited within ____ feet south of the Halligan Reservoir dam, as depicted/described more fully on Exhibit D (the “Maintenance and Operations Zone”). The City shall be entitled to temporarily prohibit LAPCR from using all or part of the Easement Area to the extent reasonably necessary when the City is performing maintenance, repair, replacement, equipment testing or inspections, or operations work associated with Halligan Reservoir and the Halligan Reservoir dam and associated infrastructure that is inconsistent with LAPCR’s use of the Easement. The City will provide notice to LAPCR of any such temporary prohibitions as soon as practicable. 6. City’s Retention and Reservation of Rights. The City expressly retains and reserves any and all rights to the City Property that are not expressly granted to LAPCR in this Easement Deed, including any and all rights associated with any construction, maintenance, and operation of Halligan Reservoir and the Halligan Reservoir dam, and rights to use the City Property for any purpose that will not violate LAPCR’s full enjoyment of the rights granted herein. The City shall be entitled to fence livestock or pedestrian traffic out of wetlands areas or any other areas under restoration. The City agrees that it will not use the Easement Area for recreation or recreational access and will not grant easements, licenses, or other rights to the Easement Area to any third parties for the purposes described in Paragraph 4, without the prior written consent of the LAPCR. LAPCR’s rights to access the Easement Area under the Easement are exclusive only in the sense that the City shall not use the subject land for recreation or recreational access and shall not grant recreational rights or recreational access to others on the same land. The City shall otherwise retain the right to access and use the Easement Area for any purpose that does not violate the Association’s rights under the Easement. 7. LAPCR Obligations regarding the City Property. (a) All activities by LAPCR on the Easement Area shall minimize disturbance to the natural features of said lands and the City’s intended purposes therefor, in particular the City’s construction and maintenance activities within the Maintenance and Operations Zone. (b) LAPCR shall install no improvements, make no excavations, and make no modifications whatsoever to or on the Easement Area. EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 3 of 13 (c) In the event that damage occurs from LAPCR’s use of or activities over or within the Easement Area, within thirty (30) days or, if such work cannot be reasonably completed in thirty (30) days, as soon as practicable thereafter, LAPCR shall make such repairs or take such other actions as may be necessary to restore the Easement Area to a condition comparable to their condition prior to LAPCR’s activities on the Easement Area, including but not limited to the reseeding and replanting of any disturbed areas in a manner reasonably satisfactory to the City, and the provision of ongoing maintenance of any seeded or planted areas, correction of any subsidence, and restoration of any other conditions impacted by LAPCR’s activities, until such time as any such repair and restoration is fully established and stabilized. Provided, however, that if damage to the Easement Area occurs as a result of third parties not associated with LAPCR using the Easement Area in violation of this Easement Deed, then LAPCR shall not be responsible in that event for making such repairs to the Easement Area. 8. Representations of the City. The City warrants and represents that is it the lawful owner in fee simple of the City Property, which includes the Easement Area, and that it has good and lawful right and authority to subject the City Property to this Easement Deed. 9. Recordation. The City will record this Easement Deed in the records of the Larimer County Clerk and Recorder promptly after it is executed, at its sole cost and expense. This Easement Deed will not be valid until it is recorded. 10. Indemnity and Insurance. (a) LAPCR releases and indemnifies the City, its officers, agents, employees, representatives, successors and assigns from and against all claims and liability, including but not limited to the City’s reasonable legal fees and costs, including attorneys’ fees, for claims for personal injury, death or property damage resulting from or arising out of LAPCR’s use of the Easement Area or other activities on the City’s Property, including but not limited to the construction, installation, operation, repair, and maintenance of improvements within the City’s Property, and for any actions or omissions by LAPCR in violation of this Easement Deed. (b) LAPCR shall maintain at its sole cost, a comprehensive policy of general liability insurance in an amount not less than One Million Dollars ($1,000,000.00) covering bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence in connection with its use of the Easement Area under this Easement. Such coverage must include, without limitation, liability for property damage, bodily injuries, and death of persons in connection with the operation, maintenance, or use of the Easement Area. 11. Notices. Any notice or other communication relating to this Easement Deed must be in writing and shall be deemed given (i) when delivered personally, or (ii) on the first business day which is three (3) days following mailing by certified mail, return receipt requested and postage EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 4 of 13 prepaid, or (iii) the next business day after sending by a nationally recognized overnight delivery service, and addressed to the party at its respective address as follows: If to LAPCR: Registered Agent on File with the Colorado Secretary of State If to the City: Real Estate Services Manager City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 117 North Mason St. Fort Collins, CO 80524 With a copy to: City Attorney’s Office City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 300 LaPorte Avenue Fort Collins, CO 80521 12. Default and Litigation Expenses. If a party to this Easement Deed is in default in performance of its respective obligations hereunder, the other party has the right to an action for specific performance or damages or both. Prior to proceeding with any such action, the party not in default must first send written notice to the defaulting party specifying the default and affording such party a reasonable period, but in no event longer than forty-five (45) days, to cure the default. In the event a party defaults in any of its covenants or obligations and the party not in default commences and substantially prevails in any legal or equitable action against the defaulting party, the defaulting party expressly agrees to pay all reasonable expenses of the litigation, including a reasonable sum for attorneys' fees or similar costs of legal representation. 14. Additional Terms and Conditions. (a) Whenever used herein, the singular number includes the plural, the plural the singular; and the use of any gender is applicable to all genders. (b) All of the covenants herein contained are binding upon and inure to the benefit of the parties hereto, their personal representatives, successors and permitted assigns. (c) The parties intend and agree that this Easement Deed is to be construed and enforced according to the laws of Colorado, that venue in any proceeding related EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 5 of 13 to the subject matter of this Easement Deed will be in Larimer County, Colorado, and that this Easement Deed is binding upon the parties hereto and their trustees, heirs, personal representatives, successors and assigns. (d) If any term of this Easement Deed is determined by any court to be unenforceable, the other terms of this Easement Deed shall nonetheless remain in full force and effect; provided, however, that if the severance of any such provision materially alters the rights or obligations of the parties, the parties shall engage in good faith negotiations in order to adopt mutually agreeable amendments to this Easement Deed as may be necessary to restore the parties as closely as possible to the initially agreed upon relative rights and obligations. IN WITNESS WHEREOF, the LAPCR, has hereunder set its hand and seal the day and year first above written; and the City has caused this Easement Deed to be executed by its Mayor, attested to by its City Clerk, and its corporate seal to be hereunto affixed, all pursuant to Ordinance No. ______________, passed on final reading by the City Council of the City of Fort Collins on the ____ day of __________, 20__, and pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project, dated __________. EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 6 of 13 THE CITY OF FORT COLLINS, COLORADO a Municipal Corporation Date: By: _________________________________ Mayor ATTEST: City Clerk _______________________ (Printed name) APPROVED AS TO FORM: Eric Potyondy, Assistant City Attorney STATE OF COLORADO ) ) ss. COUNTY OF LARIMER ) The foregoing instrument was acknowledged before me this ______ day of ____________________, 2020, by __________________________ as Mayor of the City of Fort Collins. Witness my hand and official seal. My Commission expires: Notary Public EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 7 of 13 GRANTEE: Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation Date: By: Brian T. Gray, President STATE OF COLORADO ) ) ss COUNTY OF ____________) The foregoing instrument was acknowledged before me this _______ day of ________, ______, by Brian T. Gray as President for the Landowners’ Association for Phantom Canyon Ranches. Witness my hand and official seal. My Commission expires: _______________________ Notary Public EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 8 of 13 EXHIBIT A Legal Description of the City’s Property EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 9 of 13 EXHIBIT B Legal Description of the LAPCR’s Property *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 10 of 13 EXHIBIT C Legal Description and Depiction of the Easement Area *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 11 of 13 EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 12 of 13 EXHIBIT A Exhibit D-2 to Agreement Regarding the Halligan Water Supply Project Page 13 of 13 EXHIBIT D Description of the Maintenance and Operations Zone *Placeholder until location is identified and a surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 1 of 13 EASEMENT DEED WITH TERMS AND CONDITIONS (Access for LAPCR to Southern Shoreline of Halligan Reservoir) THIS EASEMENT DEED WITH TERMS AND CONDITIONS (“Easement Deed”) is made and entered into this [_____] day of [______], 20__ (the “Effective Date”), by and between THE CITY OF FORT COLLINS, COLORADO, a municipal corporation (“City”), and THE LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado nonprofit corporation (“LAPCR”). 1. City Property. The City is the owner of that certain parcel of real property located in Larimer County, Colorado, which is legally described on Exhibit A, consisting of [____] page(s), attached to and made a part of this Deed (“City Property”). The City Property is adjacent to Halligan Reservoir. In this Easement Deed, “Halligan Reservoir” refers to that reservoir as enlarged.0F 1 2. LAPCR Property. LAPCR is the owner of that certain parcel of real property located in Larimer County, Colorado, which is legally described on Exhibit B, consisting of [___] page(s), attached to and made a part of this Easement Deed (“LAPCR Property”). 3. Grant of Easement. The City hereby grants to LAPCR, its members and their guests, and LAPCR’s successors in ownership of the LAPCR Property, a perpetual access easement (the “Easement”) on, over, and across the City Property, which is a strip of land along the south shore of Halligan Reservoir in Section 33 and the southwest quarter of Section 34 all in Township 11 North, Range 71 West of the 6th P.M. as described more fully on Exhibit C, consisting of _____ (____) page(s), attached to and made a part of this Easement Deed (the “Easement Area”), for the benefit of LAPCR Property, subject to the conditions and restrictions set forth below. As described in Exhibit C, the Easement Area is generally bounded by the following (moving in a clockwise direction): (a) the west side of Halligan Reservoir dam; (b) the 110 foot contour line of Halligan Reservoir, which is above both the historical approximately 70 foot contour line of Halligan Reservoir and the approximately 95 foot contour line of the City’s currently planned enlargement of Halligan Reservoir as part of the Halligan Water Supply Project; (c) the west section line of Section 33; and (d) the actual water line of Halligan Reservoir, which will vary depending on the amount of water in storage at any given time. For illustrative purposes only, a map depicting the approximate location of the Easement Area is included in Exhibit C. 4. Purpose of Easement. LAPCR may use the Easement Area for the following purposes: livestock grazing (provided that no domesticated sheep or goats shall be allowed on the land); fishing; non-motorized recreation (e.g., hiking, wildlife viewing). No hunting is allowed on the Easement Area. Except as expressly authorized herein, vehicular access and motorized access of any kind without the City’s prior consent are prohibited. LAPCR shall be allowed to utilize motor 1 Halligan Reservoir is generally located in portions of Sections 27, 28, 29, 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M. The Reservoir Dam is generally located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 2 of 13 vehicles in the Easement Area for the purposes of: weed management; and accessing a location from which LAPCR could access the surface of Halligan Reservoir to the extent that LAPCR or its members acquire rights to access the surface of the reservoir. Nothing in this Easement Deed shall be construed to grant to LAPCR any rights to access the surface of Halligan Reservoir. 5. Halligan Reservoir. Use of the Easement Area by LAPCR shall not interfere with use of the City Property by the City in connection with the maintenance, operation, and repair of Halligan Reservoir and related infrastructure by the City, including construction- and non-construction- related activities, including: repair, maintenance, inspections, or other necessary work to maintain infrastructure, creation of material stockpiles (such as from dredging and other work); outlet works/stilling basin work; stream gage-related work; wetland, vegetation, and/or habitat reestablishment; and fencing off certain sensitive areas from access by the LAPCR in association with mitigation or other permitting requirements, such as wetland and vegetation reestablishment areas. Because the Easement Area is close in proximity to the Halligan Reservoir dam, where maintenance, repair, replacement, and operation activities will occur, access under this Easement will be limited to ___________ feet west of the dam, as depicted/described more fully on Exhibit D (the “Maintenance and Operations Zone”). The City shall be entitled to temporarily prohibit LAPCR from using all or part of the Easement Area to the extent reasonably necessary when the City is performing maintenance, repair, replacement, or operations work associated with Halligan Reservoir and the Halligan Reservoir dam and associated infrastructure that is inconsistent with LAPCR’s use of the Easement. The City will provide notice to LAPCR of any such temporary prohibitions as soon as practicable. 6. City’s Retention and Reservation of Rights. The City expressly retains and reserves any and all rights to the City Property that are not expressly granted to LAPCR in this Easement Deed, including any and all rights associated with the construction, maintenance, and operation of Halligan Reservoir, and rights to use the City Property for any purpose that will not violate LAPCR’s full enjoyment of the rights granted herein. The City shall be entitled to fence livestock (including LAPCR livestock under this Easement Deed) out of wetlands areas or any other areas under restoration. The City agrees that it will not use the Easement Area for recreation, recreational access, or livestock grazing and will not grant easements, licenses, or other rights to the Easement Area to any third parties for the purposes described in Paragraph 4, without the prior written consent of LAPCR. LAPCR’s rights to access the Easement Area under the Easement are exclusive only in the sense that the City shall not use the subject land for recreation or recreational access and shall not grant recreational rights or recreational access to others on the same land. The City shall otherwise retain the right to access and use the Easement Area for any purpose that does not violate the Association’s rights under the Easement. 7. LAPCR Obligations regarding the City Property. (a) All activities by LAPCR on the Easement Area shall minimize disturbance to the natural features of said lands and the City’s intended purposes therefor, in particular the City’s construction and maintenance activities within the Maintenance and Operations Zone. EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 3 of 13 (b) LAPCR shall install no improvements, make no excavations, and make no modifications whatsoever to or on the Easement Area. (c) In the event that damage occurs from LAPCR’s use of or activities over or within the Easement Area, within thirty (30) days or, if such work cannot be reasonably completed in thirty (30) days, as soon as reasonably practicable thereafter, LAPCR shall make such repairs or take such other actions as may be necessary to restore the Easement Area to a condition comparable to their condition prior to LAPCR’s activities on the Easement Area, including but not limited to the reseeding and replanting of any disturbed areas in a manner reasonably satisfactory to the City, and the provision of ongoing maintenance of any seeded or planted areas, correction of any subsidence, and restoration of any other conditions impacted by LAPCR’s activities, until such time as any such repair and restoration is fully established and stabilized. Provided however, that if damage to the Easement Area occurs as a result of third parties not associated with LAPCR using the Easement Area in violation of this Easement Deed, then LAPCR shall not be responsible in that event for making such repairs to the Easement Area. 8. Representations of the City. The City warrants and represents that is it the lawful owner in fee simple of the City Property, which includes the Easement Area, and that it has good and lawful right and authority to subject the City Property to this Easement Deed. 9. Recordation. The City will record this Easement Deed in the records of the Larimer County Clerk and Recorder promptly after it is executed and its sole cost and expense. This Easement Deed will not be valid until it is recorded. 10. Indemnity and Insurance. (a) LAPCR releases and indemnifies the City, its officers, agents, employees, representatives, successors and assigns from and against all claims and liability, including but not limited to the City’s reasonable legal fees and costs, including attorneys’ fees, for claims for personal injury, death or property damage resulting from or arising out of LAPCR’s use of the Easement Area or other activities on the City’s Property, including but not limited to the construction, installation, operation, repair, and maintenance of improvements within the City’s Property, and for any actions or omissions by LAPCR in violation of this Easement Deed. (b) LAPCR shall maintain at its sole cost, a comprehensive policy of general liability insurance covering the Improvements and insuring the LAPCR in an amount not less than One Million Dollars ($1,000,000.00) covering bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence in connection with its use of the Easement Area. Such coverage must include, without limitation, liability for property damage, bodily injuries, and death of persons in connection with the operation, maintenance, or use of the Easement Area under this Easement. EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 4 of 13 11. Notices. Any notice or other communication relating to this Easement Deed must be in writing and shall be deemed given (i) when delivered personally, or (ii) on the first business day which is three (3) days following mailing by certified mail, return receipt requested and postage prepaid, or (iii) the next business day after sending by a nationally recognized overnight delivery service, and addressed to the party at its respective address as follows: If to LAPCR: Registered Agent on File with the Colorado Secretary of State If to the City: Real Estate Services Manager City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 117 North Mason St. Fort Collins, CO 80524 With a copy to: City Attorney’s Office City of Fort Collins Mailing Address: P.O. Box 580 Fort Collins, CO 80522-0580 Hand Delivery: 300 LaPorte Avenue Fort Collins, CO 80521 12. Default and Litigation Expenses. If a party to this Deed is in default in performance of its respective obligations hereunder, the other party has the right to an action for specific performance or damages or both. Prior to proceeding with any such action, the party not in default must first send written notice to the defaulting party specifying the default and affording such party a reasonable period, but in no event longer than forty-five (45) days, to cure the default. In the event a party defaults in any of its covenants or obligations and the party not in default commences and substantially prevails in any legal or equitable action against the defaulting party, the defaulting party expressly agrees to pay all reasonable expenses of the litigation, including a reasonable sum for attorneys' fees or similar costs of legal representation. 14. Additional Terms and Conditions. (a) Whenever used herein, the singular number includes the plural, the plural the singular; and the use of any gender is applicable to all genders. (b) All of the covenants herein contained are binding upon and inure to the benefit of the parties hereto, their personal representatives, successors and permitted assigns. EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 5 of 13 (c) The parties intend and agree that this Easement Deed is to be construed and enforced according to the laws of Colorado, that venue in any proceeding related to the subject matter of this Easement Deed will be in Larimer County, Colorado, and that this Easement Deed is binding upon the parties hereto and their trustees, heirs, personal representatives, successors and assigns. (d) If any term of this Easement Deed is determined by any court to be unenforceable, the other terms of this Easement Deed shall nonetheless remain in full force and effect; provided, however, that if the severance of any such provision materially alters the rights or obligations of the parties, the parties shall engage in good faith negotiations in order to adopt mutually agreeable amendments to this Easement Deed as may be necessary to restore the parties as closely as possible to the initially agreed upon relative rights and obligations. IN WITNESS WHEREOF, the LAPCR has hereunder set its hand and seal the day and year first above written; and the City has caused this Easement Deed and Agreement to be executed by its Mayor, attested to by its City Clerk, and its corporate seal to be hereunto affixed, all pursuant to Ordinance No. ______________, passed on final reading by the City Council of the City of Fort Collins on the ____ day of __________, 20__, and pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project, dated __________. EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 6 of 13 THE CITY OF FORT COLLINS, COLORADO a Municipal Corporation Date: By: _________________________________ Mayor ATTEST: City Clerk _______________________ (Printed name) APPROVED AS TO FORM: Eric Potyondy, Assistant City Attorney STATE OF COLORADO ) ) ss. COUNTY OF LARIMER ) The foregoing instrument was acknowledged before me this ______ day of ____________________, 2020, by __________________________ as Mayor of the City of Fort Collins. Witness my hand and official seal. My Commission expires: Notary Public EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 7 of 13 GRANTEE: Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation Date: By: Brian T. Gray, President STATE OF COLORADO ) ) ss COUNTY OF ____________) The foregoing instrument was acknowledged before me this _______ day of ________, ______, by Brian T. Gray as President for the Landowners’ Association for Phantom Canyon Ranches. Witness my hand and official seal. My Commission expires: _______________________ Notary Public EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 8 of 13 EXHIBIT A Legal Description of the City’s Property EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 9 of 13 EXHIBIT B Legal Description of the LAPCR’s Property *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 10 of 13 EXHIBIT C Legal Description and Depiction of the Easement Area *Placeholder until surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 11 of 13 EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 12 of 13 EXHIBIT A Exhibit D-3 to Agreement Regarding the Halligan Water Supply Project Easement – City Grantor Page 13 of 13 EXHIBIT D Description of the Maintenance and Operations Zone *Placeholder until location is identified and surveyed legal description and depiction are completed pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project * EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 1 of 11 AMENDED AND RESTATED LEASE AGREEMENT BETWEEN THE CITY OF FORT COLLINS AND THE PHANTOM CANYON LANDOWNERS ASSOCIATION FOR HALLIGAN RESERVOIR AND ADJACENT PROPERTY This Amended and Restated Lease Agreement (this “Lease Agreement”) is entered into this ___ day of ______, 20__, by and between the following Parties: the City of Fort Collins, Colorado, a municipal corporation (the “City”), and The Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation (the “Association”). RECITALS A. Halligan Reservoir, also known as North Poudre Reservoir No. 16 (the “Reservoir”) is an on-channel reservoir located on the North Fork of the Cache la Poudre River, in portions of Section 29, 32, 33, and 34, Township 11 North, Range 71 West of the 6th P.M., Larimer County, Colorado. The visible portions of the Reservoir’s dam and spillway are located in the NE1/4 of the SW1/4 of Section 34, Township 11 North, Range 71 West of the 6th P.M. (the “Dam and Spillway”). B. The North Poudre Irrigation Company (“North Poudre”) historically owned and operated the Reservoir and owned the real property described in Recital D (the “Property”). North Poudre also historically leased recreational rights to the Reservoir and the Property to the Association and its predecessor. C. The City acquired various rights to the Reservoir and surrounding lands from North Poudre pursuant to: the Warranty Deed, dated January 22, 2004, recorded with the Larimer County Clerk on January 26, 2004 at Reception No. 2004-0007821; and the Bargain and Sale Deed, dated January 22, 2004, recorded with the Larimer County Clerk on January 26, 2004 at Reception No. 2004-0007822. D. Pursuant to said Warranty Deed, the City acquired the following lands in Township 11 North, Range 71 West of the 6th P.M.: Section 32: The N1/2 of the NE1/4; Section 33: The N1/2; the N1/2 of the SE1/4 and the N1/2 of the SW1/4; Section 34: The N1/2 of the NE1/4; the SW1/4 of the NE1/4; the NW1/4 of the SE1/4 and the SW1/4; Excepting from all of the above that portion lying above the 110 foot contour of Halligan Reservoir as conveyed by Deed recorded January 9, 1913 in Book 242 at Page 355. E. The Association is an organization, the members of which own an interest in one or more of the parcels of the Phantom Canyon Ranches (the “Members”). A map of the Phantom EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 2 of 11 Canyon Ranches is attached hereto as Exhibit “A” and incorporated herein by reference (the “Map”). The Map shows the parcels within Phantom Canyon Ranches (“Parcels”) and the Roads that provide access to the Parcels and the Reservoir (the “Roads”). Easements for the Roads were created by a Declaration of Easements dated December 30, 1988 and recorded January 31, 1989 with the Larimer County Clerk at Reception No. 89004600 (the “Declaration of Easements”). The Declaration of Easements and the Second Amended and Restated Declaration of Covenants, Conditions and Restrictions for Phantom Canyon Ranches recorded June 8, 2009 with the Larimer County Clerk at Reception No. 20090037601 of the Larimer County, Colorado records (the “Covenants”) apply to use of Meadow Creek Road (from Larimer County Road 80C to Halligan Reservoir, as highlighted in yellow on the Map) and rights granted under this Lease Agreement. The Association and its Members have historically shown a commitment to the preservation of the land. For instance, many of the Parcels are subject to conservation easements, and the Association has historically cared for the Reservoir and preserved and enhanced the habitat of the Property and the surrounding lands owned by the Association. F. The City intends to enlarge the Reservoir from its current capacity of approximately of approximately 6,408 acre feet to, among other things, meet the projected future demand of lands and persons that receive water service from the City (the “Project”). Presently, the City anticipates enlarging the Reservoir to approximately 14,525 acre feet. The City has applied to the United States Army Corps of Engineers for a permit (the “Permit”) under Section 404 of the federal Clean Water Act for the Project (the “Permitting Process”). G. The City desires to lease the Property and Reservoir to the Association, which will benefit the City (including Fort Collins Utilities) by, among other things, assisting in the maintenance of the Reservoir and Property, facilitating the Permitting Process, and generating a revenue stream from the Property and Reservoir. H. The Association desires to acquire rights to use the Reservoir and Property, primarily for recreational purposes. I. The City desires to use Meadow Creek Road to obtain access to Halligan Reservoir and the Property and the Association is willing to grant to the City the right to use Meadow Creek Road subject to the terms and conditions of Section 4(c) for this Lease Agreement. J. The original Lease Agreement is dated March 9, 2017, and was recorded with the Larimer County Clerk and Recorder on March 23, 2017 at Reception No. 20170019010. The Parties subsequently agreed to certain amendments to the original Lease Agreement as part of and set forth in the Agreement Between the City of Fort Collins and The Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project (“Halligan Project Agreement”). Pursuant to the term of the Halligan Project Agreement, the Parties are executing this Amended and Restated Lease Agreement to incorporate those amendments and to replace the original Lease Agreement in its entirety. No other substantive changes to the original Lease Agreement are included in this Amended and Restated Lease Agreement. AGREEMENT AND UNDERSTANDING EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 3 of 11 1. INCORPORATION OF RECITALS. The foregoing recitals are hereby incorporated herein as if fully restated in their entirety. 2. LEASE OF THE PROPERTY AND RESERVOIR. The City hereby grants an exclusive lease to the Association for the Property and Reservoir, subject to the terms and conditions of this Lease Agreement including, by example and not limitation, the City’s reserved rights as set forth in Paragraph 4. 3. TERMS AND CONDITIONS ON USE OF THE PROPERTY AND RESERVOIR. a. The Association acknowledges that the Property and Reservoir are being taken “as is” under this Lease Agreement. The City makes no warranties as to the suitability of the Property for the Association’s intended activities. b. The Property may be used by the Association, its Members, their guests, and invitees for recreational purposes, including, by example and not limitation, hunting, hiking, and horseback riding. In addition, the Association may use the Property for livestock grazing and related activities. c. The Reservoir may be used by the Association, its Members, their guests, and invitees for recreational purposes only, including, by way of example and not limitation, fishing, boating, canoeing, sailing, and swimming. d. Use of the Reservoir and the Property by the Association, its Members, their guests, and invitees shall comply with and shall not be in violation of any applicable laws, regulations or ordinances of the United States of America, State of Colorado, County of Larimer, the City, and any other governmental entity having jurisdiction over the Reservoir and/or the Property including, by example and not limitation, rules and regulations pertaining to hunting, fishing, boating safety. e. The Association shall not install any permanent fixtures or improvements on the Property. f. The Dam and Spillway are located near the southeast corner of the Reservoir in the channel of the North Fork of the Cache la Poudre River. The Association agrees to act in good faith and use reasonable efforts to prohibit any recreational activity in the immediate vicinity of the Dam and Spillway. The Association shall adopt rules and regulations and post appropriate signs and notices prohibiting swimming, boating, sailing, canoeing, fishing, or conducting any other activity near the Dam and Spillway. g. To the extent allowed by law, the Association shall have the right, but not the obligation, to prohibit any and all persons from entering upon the Property and/or Reservoir for any reason; provided, however that the Association shall not act in any way that inhibits the City’s reserved rights as set forth in Paragraph 4. EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 4 of 11 4. RESERVED RIGHTS OF THE CITY. The City hereby reserves the following rights to the Property and Reservoir for itself, its employees, agents, and contractors, and persons and entities working on the Permitting Process or the Project: a. During the time period after the City has begun construction on the Halligan Reservoir enlargement and before the City has issued a notice to the Association that the Colorado Division of Water Resources has accepted construction of the new Reservoir Dam pursuant to its Rules and Regulations for Dam Safety and Dam Construction, 2 CCR 402-1 (or successor regulations) and that Phase 2 (Construction) is complete, the City shall be entitled to impose reasonable limitations on the Association’s use of the Property to allow the City to complete construction and for health and safety reasons. b. The City shall be entitled to use and operate the Reservoir as a water storage reservoir including, but not limited to, maintenance, repair, and operation of the Dam and Spillway, and fluctuation of the water level in the Reservoir. The Parties expressly acknowledge that the City has retained and may continue to retain North Poudre (and/or another entity) to operate the Reservoir and associated property pursuant to various service agreements. c. The City shall be entitled to enter the Property and the Reservoir by roads other than Meadow Creek Road, Andrews Park Road, Jackson Park Road, or Three Corner Gate Road for the following purposes: i. Any and all purposes associated with the Permitting Process and other processes associated with the enlargement of the Reservoir including, but not limited to, investigations and studies performed by the City and relevant governmental agencies and their employees and agents (such as, by way of example and not limitation, the United States Army Corps of Engineers, Larimer County, Colorado Parks and Wildlife, and the Colorado Water Conservation Board). ii. Any and all purposes associated with legal and regulatory compliance including, but not limited to, dam safety inspections, water quality monitoring and compliance, and water rights administration. iii. For site visits for the purposes of providing information to City employees and officials, governmental representatives, and members of the public. iv. For purposes, of confirming that the Association is complying with the Lease Agreement’s terms. d. The City shall have the right to use Meadow Creek Road to enter the Property and the Reservoir pursuant to the following terms and conditions: i. Use of Meadow Creek Road by the City shall be limited to the following purposes: for the purpose of conducting studies required for the Permitting Process by the U.S. Army Corps of Engineers or other federal, state, or local agencies; for maintenance and safety inspections of the Halligan Dam; for regulatory compliance, and for water quality studies. EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 5 of 11 ii. The City shall notify the Association President and Association’s caretaker prior to each use of Meadow Creek Road. Notification may be given by phone call, email, or in writing. iii. Any use of Meadow Creek Road by City for purposes other than those listed in Section 4(c)(i) shall be allowed at the sole and absolute discretion of the Association. The City shall provide a request to the Association to use Meadow Creek Road for purposes other than those listed in Section 4(c)(i) in writing five (5) days in advance of desired date of use of the Meadow Creek Road. iv. A City employee shall be present for any use of Meadow Creek Road by any City agent(s) and contractors, and persons and entities working on the Permitting Process or the Project. v. Use of Meadow Creek Road is subject to the Declaration of Easements, the Covenants, and the Rules and Regulations of the Association. vi. The City may not make any improvements to Meadow Creek Road without the prior written consent of the Association, which consent may be granted or withheld in the sole and absolute discretion of the Association. The City, at its sole cost and expense, shall repair any damage to the Meadow Creek Road caused by or resulting from use of Meadow Creek Road by the City, its agents, employees, or contractors. In the event the City fails to repair any damage done to the Meadow Creek Road, the Association shall give to the City written notice of the required repairs and if such repairs are not completed by the City within thirty (30) days after notice of the required repairs is given to the City, the Association shall have the right to perform such repair work and shall be entitled to reimbursement from the City for all costs and expenses incurred by the Association in performing such repair work upon demand, together with interest on such amounts at the rate of 12% per annum from the date incurred by the Association until repaid by the City. vii. The City shall be deemed to have accepted Meadow Creek Road in its present condition, as is, where is, with all faults, patent and latent, without any representations or warranties whatsoever by the Association, its agents or employees. The City assumes all risks associated with use of Meadow Creek Road. The City acknowledges that neither the Association nor any of Association’s agents have made any representations or warranties whatsoever regarding Meadow Creek Road. The City assumes all risk that any adverse matter of whatever kind or nature including, but not limited to the physical condition of Meadow Creek Road may arise in the future. The Association shall have no obligation to the City to maintain Meadow Creek Road in its present condition or to improve Meadow Creek Road for the City’s use. viii. To the extent permitted by law and without waiving its right to governmental immunity, the City shall be deemed to have released the Association, its officers, directors, members, agents and employees and their respective heirs, personal representatives, successors and assigns (the “Released/Indemnified Parties”) from and against any and all claims, demands, actions, suits, and proceedings of whatever kind or nature that the City may now have or may have at any time in the future arising out of or as a result of the present or any future EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 6 of 11 condition of Meadow Creek Road or the use of Meadow Creek Road by the City, its agents or employees. ix. To the extent permitted by law and without waiving its right to governmental immunity, The City shall defend, indemnify and hold harmless the Released/Indemnified Parties from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the use or misuse of the of Meadow Creek Road by the City, its agents, employees, contractors or any other person or entity using Meadow Creek Road with the express or implied authorization, permission, or consent of the City. To the extent permitted by law and without waiving its right to governmental immunity, The City shall also defend, indemnify and hold harmless the Released/Indemnified Parties and the property upon which Meadow Creek Road is located from and against any and all loss, cost, and expense including attorneys’ fees arising out of, as a result of, or in connection with any claim made against the Released/Indemnified Parties as a result of the any work performed on Meadow Creek Road by the City, its agents, employees, contractors, including but not limited to mechanic’s lien claims. 5. TERM. The initial term of this Lease Agreement shall be ten (10) years commencing on the date at which this Lease Agreement is fully executed (the “Initial Term”). So long as the Association is current and not in default in the performance of any of the Association’s obligations under this Lease Agreement (or has cured any default as of the time notice is given), the Association shall have the right to extend the term of this Lease Agreement for two (2) additional periods of ten (10) years each upon the same terms and conditions as contained in this Lease Agreement (“Extension Term[s]”). If the Association elects to exercise the Association’s option to extend the term of this Lease Agreement for one or more Extension Terms, the Association shall do so by giving the City written notice of such extension not less than sixty (60) days prior to the expiration of the Initial Term of this Lease Agreement or prior to the expiration of the previous Extension Term. If the Association gives such notice, the term of this Lease Agreement shall be automatically extended for the additional period of each Extension Term without the necessity of executing any extension or renewal agreement. Notwithstanding the foregoing, this Lease Agreement may be terminated pursuant to Paragraph 6. 6. TERMINATION. The City shall have the right to terminate this Lease Agreement any time after any of the following conditions have occurred: a. The City has issued a notice to the Association that the Colorado Division of Water Resources has accepted construction of the new Reservoir Dam pursuant to its Rules and Regulations for Dam Safety and Dam Construction, 2 CCR 402-1 (or successor regulations) and that Phase 2 (Construction) is complete; or b. The City determines, in its sole discretion, to no longer pursue the enlargement of the Reservoir and abandons the Permitting Process and re-conveys the Property and the Reservoir to North Poudre. Notice of Termination shall be given pursuant to Paragraph 17. Any notice of termination shall provide the Association with a date by which the Association shall cease to have rights to the EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 7 of 11 Property and Reservoir under this Lease Agreement, provided that said date is at least sixty-three (63) days after the date of the notice (“Termination Date”). The City shall be entitled to record a notice of the termination in the Larimer County property records. Upon termination of this Lease Agreement, the City shall reimburse to the Association a prorated portion of the annual rental payment paid in the year in which termination occurs for that portion of the year when the Lease Agreement is no longer in effect. Reimbursement shall be calculated by dividing the number of calendar days between the date of termination and the date the current lease year was to conclude by 365 multiplied by the annual rent as set forth in Section 8. 7. REVOCABLE PERMIT. Upon the execution of this Lease Agreement by the Parties, the “Revocable Permit for the Landowners’ Association for Phantom Canyon Ranches on Certain City Lands in and Around Halligan Reservoir” dated June 1, 2016 (“Revocable Permit”), shall be deemed revoked and terminated and both Parties shall be released from their respective obligations thereunder. 8. Rent. Full compensation to the City for the lease for the Property and Reservoir having been made pursuant to the Agreement Between the City of Fort Collins and the Landowners’ Association for Phantom Canyon Ranches Regarding the Halligan Water Supply Project; no additional compensation to the City is required for the Initial Term or any Extension Term of this Lease Agreement. 9. INSURANCE. The Association must procure, pay for, and keep in full force and effect during the term of this Lease Agreement a comprehensive policy of general liability insurance insuring the Association in an amount not less than $1,000,000 covering bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence. Such coverage must include, without limitation, the insured’s liability for property damage, bodily injuries, and death of persons in connection with the Association’s activities on the Property and Reservoir (including acts or omissions of the Association or of its officers, employees, or agents), and protection against liability for non-owned and hired automobiles. All policies of insurance required hereunder must name the City as an additional insured, and shall contain a provision that the policy or policies cannot be canceled or materially altered either by the insured or the insurance company until fifteen (15) days’ prior written notice thereof is given to the City. Upon issuance or renewal of any such insurance policy, the Association shall furnish a certified copy or duplicate original of such policy or renewal thereof with proof of premium payment to the City. In the event the Association fails or neglects to maintain the insurance required by this paragraph, the City shall have the right, upon giving the Association reasonable notice of its election to do so, to take out and maintain such insurance at the expense of the Association, and in such event the cost of such insurance shall be paid for by the Association promptly upon receipt of an invoice covering such charges. 10. INDEMNITY. The Association agrees to indemnify and hold harmless the City, its officers, agents, employees, representatives, successors and assigns from all claims and liability, including the City’s reasonable attorneys’ fees and costs, for claims resulting from or arising out of the Association’s use of the Property and Reservoir, and for any actions or omissions by the Association in violation of this Lease Agreement or in violation of any applicable law or regulation. EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 8 of 11 11. RECORDING. The Association shall record this Lease Agreement in the Larimer County property records and shall provide the City with a copy of this Lease Agreement, as recorded, as soon as practicable. 12. REMEDIES. If either Party fails to comply with the provisions of this Lease Agreement, the other Party, after providing written notification to the noncomplying Party, and upon the failure of the noncomplying Party to achieve compliance within thirty-five (35) days, may seek all such remedies available under Colorado law. 13. FISCAL CONTINGENCY. Notwithstanding any other provision of this Lease Agreement to the contrary, the obligations of the City in fiscal years after the fiscal year of this Lease Agreement shall be subject to appropriation of funds sufficient and intended therefor, with the City having the sole discretion to determine whether the subject funds are sufficient and intended for use under this Lease Agreement, and the failure of the City to appropriate such funds shall be grounds for termination of this Lease Agreement upon ninety one (91) days prior written notice of the failure to appropriate such funds. 14. NO THIRD-PARTY BENEFICIARIES. This Lease Agreement is entered into between the Parties for the purposes set forth herein. It is the intent of the parties that they are the only beneficiaries of this Lease Agreement and the Parties are only benefitted to the extent provided under the express terms and conditions of this Lease Agreement. 15. GOVERNING LAW AND ENFORCEABILITY. This Lease Agreement shall be construed in accordance with the laws of the State of Colorado, insofar as any matter is not regulated by applicable laws of the United States. The Parties recognize that the constitutions, statutes, and rules and regulations of the State of Colorado and of the United States, as well as the Parties’ respective bylaws, city charters and codes, and rules and regulations, impose certain legal constraints on each Party and that the Parties intend to carry out the terms and conditions of this Agreement subject to those constraints. Whenever possible, each provision of this Agreement shall be interpreted in such a manner so as to be effective and valid under applicable law. 16. WAIVER. A waiver of a breach of any of the provisions of this Lease Agreement shall not constitute a waiver of any subsequent breach of the same or another provision of this Lease Agreement. 17. NOTICES. All notices or other communications required or desired to be given by one Party to the other Party under this Lease Agreement shall be sufficiently given and shall be deemed given when personally delivered, or after the lapse of five (5) business days following mailing by certified mail-return receipt requested, postage prepaid, addressed as follows: To the City: City Manager City Hall West 300 LaPorte Avenue; P.O. Box 580 Fort Collins, Colorado 80522-0580 EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 9 of 11 With copy to: Fort Collins City Attorney’s Office and: Fort Collins Utilities Attn: Water Resources Manager 700 Wood Street P.O. Box 580 Fort Collins, Colorado 80522-0580 To the Association: Registered agent on file with the Colorado Secretary of State 18. CONSTRUCTION. This Lease Agreement shall be construed according to its fair meaning as it was prepared by both Parties. 19. ENTIRE AGREEMENT. This Lease Agreement constitutes the entire agreement of the Parties regarding the matters addressed herein. This Lease Agreement binds and benefits the Parties and their respective successors. Covenants or representations not contained in this Lease Agreement regarding the matters addressed herein shall not bind the Parties. 20. CAPTIONS. The captions of the paragraphs of this Lease Agreement are for convenience only and shall not govern or influence the interpretation of the Lease Agreement 21. REPRESENTATIONS. Each Party represents to the other Party that it has the power and authority to enter into this Lease Agreement and the individual signing below on behalf of that Party has the authority to execute this Lease Agreement on its behalf and legally bind that Party. [Remainder of Page Left Blank Intentionally] EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 10 of 11 CITY OF FORT COLLINS, COLORADO, a home-rule city By: ______________________________________ Date: Kelly DiMartino, Interim City Manager ATTEST: By: ______________________________________ City Clerk Name: ____________________________________ Title: ____________________________________ APPROVED AS TO LEGAL FORM: By: ______________________________________ Eric R. Potyondy, Assistant City Attorney EXHIBIT A Exhibit E to Agreement Regarding the Halligan Water Supply Project Page 11 of 11 THE LANDOWNERS’ ASSOCIATION FOR PHANTOM CANYON RANCHES, a Colorado nonprofit corporation By: ______________________________________ Brian Gray, President STATE OF COLORADO ) ss. COUNTY OF LARIMER The foregoing instrument was acknowledged before me this _____ day of __________, 20___, by Brian Gray, as President of The Landowners’ Association for Phantom Canyon Ranches, a Colorado nonprofit corporation. Witness my hand and official seal My commission expires: ______________________________ Notary Public EXHIBIT A