HomeMy WebLinkAbout2018-024-03/06/2018-APPROVING AND AUTHORIZING THE EXECUTION OF A BINDING AGREEMENT PERTAINING TO DEVELOPMENT OF INTERSTA RESOLUTION 2018-024
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROVING AND AUTHORIZING THE EXECUTION OF A BINDING AGREEMENT
PERTAINING TO DEVELOPMENT OF INTERSTATE HIGHWAY 25 AND PROSPECT
ROAD INTERCHANGE AND THE RELATED CAPITAL PLEDGE AGREEMENT
WHEREAS, the interchange at Interstate Highway 25 and Prospect Road (the
"Interchange") is owned by the State of Colorado and operated and maintained by the Colorado
Department of Transportation ("CDOT"); and
WHEREAS,the Interchange is within the City's boundaries and adjacent to its four corners
are several undeveloped parcels of privately-owned land, which parcels are also within the City's
boundaries; and
WHEREAS, Fort Collins/I-25 Interchange Corner, LLC ("FCIC") is the fee title owner of
a parcel of land adjacent to the northwest corner of the Interchange (the "FCIC Parcel"); and
WHEREAS, Gateway at Prospect Apartments, LLC ("GAPA") is the fee title owner of a
parcel of land also adjacent to the northwest corner of the Interchange (the "GAPA Parcel"); and
WHEREAS, a group of tenants in common("TIC Owners") are the fee title owners of the .
three parcels of land adjacent to the northeast-comer of the Interchange (the "TIC Owners
Parcels"); and
WHEREAS, Paradigm Properties LLC ("Paradigm") is the fee title owner of the two
parcels of land adjacent to the southeast corner of the Interchange (the "Paradigm Parcels"); and
WHEREAS,the Colorado State University Research Foundation("CSURF")is the fee title
owner of the two parcels of land adjacent to the southwest corner of the Interchange (the"CSURF
Parcels"); and
WHEREAS, FCIC, GAPA, the TIC Owners, Paradigm and CSURF are hereafter
collectively referred to as the "Property Owners" and the FCIC Parcel, GAPA Parcel, the TIC
Owners Parcels, Paradigm Parcels and CSURF Parcels are hereafter collectively referred to as the
"Properties"; and
WHEREAS,CDOT has notified the City that it is planning a project to significantly modify
and improve the Interchange by reconstructing its ramps and bridge and by reconstructing Prospect
Road to a configuration with four through lanes, a raised.median, left turn lanes and pedestrian
and bicycle facilities,and CDOT is expected to begin construction of this project after July 1, 2018
(the "Project"); and
WHEREAS, the Project will also include certain urban design improvements requested by
the City that are typically required under the City's development standards (the "Urban Design
Features"); and
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WHEREAS, the Project and the Urban Design Features will provide significant,public
benefits to the City and its residents, and they will benefit the Property Owners by materially
increasing the value of their Properties; and
WHEREAS, CDOT estimates that the total cost of the Project, as originally proposed by
it, will be approximately $24 million, but it has indicated that it will only provide$12 million to
fund the Project, leaving a$12 million deficit; and
WHEREAS, the Urban Design Features planned by the City will add an additional $7
million to the cost of the Project, bringing the total Project cost to $31 million; and
WHEREAS, CDOT has asked the City to participate in the Project by funding the $12
million deficit originally identified by CDOT, but the City is only willing to consider funding this
deficit if the additional $7 million of Urban Design Features are included in the Project and if the
Town of Timnath, Colorado ("Timnath") and the Property Owners share in funding this $19
million deficit; and
WHEREAS, the City has previously entered into an Intergovernmental Agreement dated
April 14, 2017, with CDOT in which the City has agreed to contribute $2.25 million in support of
CDOT's project to improve I-25 from Colorado Highway 402 to Colorado Highway 14 (the
"CDOT IGA"); and
WHEREAS,on January 2,2018,the City Council adopted Resolution 2018-004 approving
an amendment to the CDOT IGA, in which amendment the City has agreed to share in the cost of
the Interchange Project as proposed by CDOT and CDOT has agreed to add the Urban Design
Features to the Project, which amendment the City and CDOT entered into on January 18, 2018
(the "Amended IGA"); and
WHEREAS, the City has also asked Timnath to share in funding.the City's commitment
to CDOT under the Amended IGA since Timnath will also experience significant public benefits
from the Project; and
WHEREAS,the City and Timnath have been negotiating a separate agreement under which
Timnath would reimburse the City for up to $2.5 million of the $19 million deficit to be paid over
a twenty-year period, thereby leaving a $16.5 million deficit(the "Remaining Deficit"); and
WHEREAS,the City and the Property Owners have previously negotiated and entered into
that certain"Memorandum of Understanding Pertaining to Development of Interstate Highway 25
and Prospect Road Interchange" dated January 30, 2018, which City Council approved in
Resolution 2018-005 on January 2, 2018 (the "MOU"); and
WHEREAS, the City and the Property Owners acknowledged in the MOU that while it is
not a binding agreement, the parties nevertheless intended to cooperate in good faith to negotiate
and enter into a binding agreement under which the parties would agree to equally share in the
payment of the Remaining Deficit; and
WHEREAS, as so intended in the MOU, City staff and the Property Owners have
negotiated in good faith the"Binding Agreement Pertaining to Development of Interstate Highway
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25 and Prospect Road Interchange" attached hereto as Exhibit "A" and incorporated herein by
reference (the "Binding Agreement"); and
WHEREAS, as contemplated in the MOU, the Property Owners agree in the Binding
Agreement to equally share the Remaining Deficit by the Property Owners agreeing to reimburse
the City over time their $8.25 million share ("Shared Deficit") to be reduced by a credit of
$500,000 representing the value of the Property Owners' land that will be dedicated to CDOT
without receiving compensation as right of way for the Project(the "ROW Credit") and a credit of
$700,000 representing the transportation capital expansion fees anticipated to be paid to the City
under Fort Collins Code Section 7.5-32 related to the future development of the Properties (the
"TCEF Credit"); and
WHEREAS, after the ROW Credit and the TCEF Credit are applied to the Shared Deficit,
the Binding Agreement provides that the Property Owners' portion of the Shared Deficit will be
$7,050,000, plus financing costs ("Owners' Share"); and
WHEREAS, the Binding Agreement further provides that the Owners' Share will accrue
interest at the rate the City incurs in financing its funding obligations to CDOT under the Amended
IGA and that this adjusted amount will be paid in twenty annual payments of principal and interest
from the Pledged Revenues (as hereinafter defined); and
WHEREAS, the Property Owners also agree in the Binding Agreement to record against
their respective Properties a covenant imposing a public improvement fee at a rate .75%, net of
any administrative fees for collection,to be imposed on all future retail sales on the Properties that
are also subject to the City's sales .tax under Article III of City Code Chapter 25, as amended .
(collectively, the "Interchange PIF Covenant"); and
WHEREAS, the Binding Agreement provides that the Owners' Share will be paid by the
Interchange Metro District (hereinafter defined) solely from its pledge of a combination of a
property tax mill levy of not less than 7.5 mills, but not more than 10 mills, on the Properties
("Property Tax"), fees imposed on and collected from future development occurring on the
Properties ("Project Fees") as provided in the service plan of the proposed I-25/Prospect
Interchange Metropolitan District (the "Interchange.Metro District") to be organized under the
Colorado Special District Act (the "District Act"), and net revenues from the Interchange PIF
Covenant; and .
WHEREAS, this commitment by the Interchange Metro District to pledge the Property
Tax, the Project Fees and the net revenues from the Interchange PIF Covenant (collectively, the
"Pledged Revenues") to the payment of the Owners' Share is set out in the Capital Pledge
Agreement attached as Exhibit `B" to the Binding Agreement (the "Capital Pledge Agreement");
and
WHEREAS, as anticipated in the MOU, four of the Property Owners also wish to form
other metropolitan districts under the District Act to use to construct and fund some or all of the
basic public infrastructure needed in the future development of their individual Properties,whether
such development is commercial or residential, and for maintenance of such infrastructure and for
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all other purposes allowed by the District Act and the approved service plans (the "Development
Metro Districts"); and
WHEREAS, the Interchange Metro District and the Development Metro Districts shall be
collectively referred to as the "Metro Districts"; and
WHEREAS, the Metro Districts cannot be created under the District Act without the
Council of the City of Fort Collins (the "City Council") approving a service plan for each of the
Metro Districts (collectively, "Service Plans") which, together with the District Act, will govern
the operation of the Metro Districts and their authority to impose, collect, spend and pledge
property taxes and fees, issue debt, and they will delineate the type of basic public infrastructure
and services the Metro Districts will be_authorized to provide and how the Metro Districts will
cooperate with each other, the City and the Property Owners to fund regional and local
infrastructure; and
WHEREAS, the Binding Agreement contemplates that if all of the Service Plans are not
approved by Council, that the Interchange Metro District will not enter into the Capital Pledge
Agreement and the Property Owners will not record the Interchange PIF Covenant, however the
Binding Agreement also contemplates that the Development Districts will be unable to impose any
fees or property tax mill levy or issue any debt unless the Interchange Metro District conducts an
election on May 8, 2018, in accordance with Article X, Section 20 of the Colorado Constitution,
that authorizes the Interchange Metro District's Property Tax and the Capital Pledge Agreement,
the Interchange Metro District enters into the Capital Pledge Agreement,and the Property Owners
record the PIF Covenant against all of their respective Properties; and
WHEREAS,the City Council hereby finds that the Binding Agreement is necessary for the
public's health, safety and welfare and,is in the best interests of the City and its residents,
businesses and public and private organizations.
NOW, THEREFORE, BE IT RESOLVED 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 Binding Agreement is hereby approved and the Mayor is
authorized to execute it substantially in the form attached as Exhibit "A".
Section 3. That provided all the preconditions of the Binding Agreement are
satisfied, the City Manager is authorized to execute the Capital Pledge Agreement in
substantially the form attached as Exhibit "B" to the Binding Agreement, together with such
revisions and amendments as the City Manager, in consultation with the City Attorney,
determines to be necessary and appropriate to protect the interests of the City or to effectuate
the purposes of this Resolution.
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Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 6th
day of March, A.D. 2018.
Mayor
ATTEST:
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City Cl
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EXHIBIT A
BINDING AGREEMENT PERTAINING TO DEVELOPMENT OF
INTERSTATE HIGHWAY 25 AND PROSPECT ROAD INTERCHANGE
THIS BINDING AGREEMENT (this "Agreement") is made and entered into this
day of , 2018 (the "Effective Date") , by and between the City of Fort Collins ,
Colorado, a Colorado home rule municipality (the "City") ; Fort Collins/I-25 Interchange Corner,
LLC, a Colorado limited liability company ("FCIC") ; Gateway at Prospect Apartments, LLC, a
Colorado limited liability company ("GAPA") ; a group of tenants in common comprised of the
CW Subtrust, M. Jennet White, Christopher White, Eric. S . White, Jane E. White, Jason R.
White, Daniel A. White, New Direction IRA, Inc. FBO Barbara Ann Medina IRA, Booren
Limited Liability Partnership, Dunkin Limited Liability Limited Partnership, Laura Snortland
Fairfield, Robert C. Roth, Jr. and Robert Taylor (collectively, the "TIC Owners") ; Paradigm
Properties LLC, a California limited liability company ("Paradigm") ; and Colorado State
University Research Foundation, a Colorado non-profit corporation ("CSURF") (each a "Party"
and collectively the "Parties") .
WITNESSETH .
WHEREAS , pursuant to a Memorandum of Understanding dated as of January 30, 2018
(the "MOU") by and among the City and the other parties identified therein (together with the
TIC Owners, the "Owners"), the City and the Owners established a non-binding outline of
documents and terms to be negotiated for the sharing of costs of improvements to the highway
interchange at Interstate Highway I-25 and Prospect Road in the City; and
WHEREAS , one of the documents contemplated by the MOU was a binding agreement
between the Property Owners and the City, identified as the Binding Agreement, whereby the
Property Owners would agree to pay the Owners ' Share to the City from various pledged
revenues and to memorialize other commitments between the Parties ;
WHEREAS , this Agreement shall constitute the Binding Agreement contemplated by the
MOU ;
NOW, THEREFORE, for and in consideration of the promises and mutual covenants and
understandings herein, the Parties hereby agree as follows :
ARTICLE 1
DEFINED TERMS AND INTERPRETATION
Li Definitions. Capitalized terms used herein and not defined in the Recitals above
or elsewhere in this Agreement shall have the meanings , respectively, specified in Exhibit "A"
hereto.
1 . 2 Interpretation. In this Agreement, unless the context expressly indicates
otherwise, the following words shall be interpreted as set forth below :
(a) The words "herein," "hereunder," "hereby," "hereto," "hereof and any similar
words , refer to this Agreement as a whole and not to any particular article, section, or
subdivision hereof; the word "heretofore" means before the date of execution of the
Agreement; and the term "hereafter" means after the date of execution of this Agreement.
(b) All definitions, terms, and words shall include both the singular and the plural,
and, except as otherwise expressly defined in the text of this Agreement, all capitalized
words or terms shall have the meanings specified in Exhibit "A" attached hereto.
(c) Words of the masculine gender include correlative words of the feminine and
neuter genders, and words importing the singular number include the plural number and
vice versa.
(d) The captions or headings of this Agreement are for convenience only, and in no
way define, limit, or describe the scope or intent of any provision, article, or section of
this Agreement.
(e) All schedules , exhibits , and addenda referred to herein are incorporated herein by
this reference.
ARTICLE 2
FINANCING OF OWNERS ' SHARE.
2. 1 Owners ' Share. The Owners ' Share shall be the share of the costs of the Project
to be funded by the Interchange District in accordance with the terms and provisions of this
Agreement and the Capital Pledge Agreement. The Owners have agreed to fund costs of the
Project in the amount of $8 ,250,000, plus financing costs and interest as provided in the Capital
Pledge Agreement. Upon execution and delivery of this Agreement, the City shall grant the
TCEF Credit in the amount of $700,000 to reduce the principal amount of the Owners ' Share to
$7 ,550,000, plus financing costs , as set forth in the Capital Pledge Agreement. The City shall
additionally grant the ROW Credit in the amount of $500,000 to further reduce the principal
amount of the Owners ' Share upon compliance with the provisions set forth in Section 2. 3
hereof.
The Owners hereby agree to take all reasonable action necessary to ensure that the
Interchange District pays the Pledged Revenues to the City in an amount equal to the Owners '
Share, the manner and timing of such payments being further described in the Capital Pledge
Agreement, the form of which is attached as Exhibit `B" hereto and by this reference made a part
hereof.
2.2 Interchange PIF. Each Owner hereby agrees that it will record with respect to
its Property in the Interchange District an Interchange PIF Covenant touching, concerning and
running with the land, as further described in the Capital Pledge Agreement. The form of each
Owner' s Interchange PIF Covenant may differ provided that it contain provisions requiring that
the collected Interchange PIF be included as a component of the Pledged Revenues . The Owners
reserve the right to impose additional PIFs , that are not the Interchange PIF, to pay public
improvement costs related to the development of their respective Properties . Each Development
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Metropolitan District shall have the right to receive such additional PIF revenues , which
revenues shall not be required to be pledged to the City for payment of the Owners ' Share.
The Interchange PIF Covenant shall provide that the City has the right to review
the records relating to the imposition and collection of the Interchange PIR The City shall have
the right to review the Interchange PIF Covenant to confirm that the provisions thereof comply
with the provisions of this Agreement and the Capital Pledge Agreement.
The Owners hereby acknowledge that pursuant to the provisions of the Service
Plans, the Development Metropolitan Districts are not authorized to impose the Development
Mill Levy, impose any District Fees , or issue any debt until each of the Owners records the
Interchange PIF Covenant against its respective Property.
Upon payment in full of the Owners ' Share, the City acknowledges and agrees
that the Interchange PIF may be terminated by the Owners . Upon payment in full of the Owners '
Share, each Owner shall have the right to continue to impose and collect the Interchange PIF
with respect to its respective Property and apply the Interchange PIF revenues to permissible
costs, as determined in the sole discretion of each respective Owner.
2. 3 Property Owners ' ROW Credit. CDOT is currently seeking to acquire from
one or more of the Owners portions of their Properties to be used as Project ROW . In lieu of
collecting direct compensation from CDOT, the Owners have elected to dedicate a portion of the
Project ROW compensation in an amount equal to $500,000 to CDOT. So long as no event of
default has occurred and is continuing under this Agreement or the Capital Pledge Agreement,
the City shall grant the ROW Credit in the amount of $500,000 to reduce the principal amount of
the Owners ' Share upon receipt of written acknowledgement by CDOT that (a) the Owners have
dedicated Project ROW to CDOT in an amount at least equal to $500,000, and (b) CDOT has
granted a credit to the City toward the costs of the Project in an amount equal to $500,000. The
ROW Credit may be applied as a credit to the principal payments due from the Interchange
District to the City pursuant to the Capital Pledge Agreement in any order and in any amount as
designated in writing by the Owners to the City and the Interchange District. Upon
determination by the Owners of the application of the ROW Credit, the Payment Schedule shall
be revised by the City to reflect such ROW Credit, as further set forth in the Capital Pledge
Agreement.
None of the Property Owners intends, by the execution of this Agreement or the
Capital Pledge Agreement, to waive its rights to full and just compensation for the taking of its
property or to due process with respect to such Project ROW acquisition .
2A Property Owners ' Credit for Transportation Capital Expansion Fees . The
City acknowledges that it has $ 1 .4 million of TCEFs available to help fund the Project. In
recognition of the TCEFs that the Owners are likely to pay to the City when they develop their
respective properties , the City has agreed to credit one half of these available TCEFS , or
$700,000, to the payment of the Owners ' Share upon execution and delivery of this Agreement,
as further set forth in Section 2 . 1 hereof.
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ARTICLE 3
DISTRICTS.
3 . 1 Approval of Service Plans . The Parties acknowledge that the TIC Owners ,
CSURF, FCIC and GAPA have each submitted a consolidated Service Plan for their respective
Development Metropolitan Districts for customary review and processing by the City, and the
Owners have further caused the Service Plan for the Interchange District to be submitted to the
City. The City Council shall consider resolutions of approval for each Service Plan described
above no later than March 6 , 2018 . The Parties acknowledge and agree that it is within the City
Council ' s sole discretion whether it will approve the Service Plans , and nothing herein shall be
construed to require such approval by the City Council . Nothing in this Agreement shall prevent
the filing of additional Service Plans at a later date .
3 . 2 Interchange District Boundaries. Each of the Properties will be included within
the boundaries of the Interchange District, which inclusion will be reflected in the overall
boundary map contained in the District' s Service Plan .
3 . 3 Project Mill Levy. The Service Plan for the Interchange District shall authorize
such District to impose the Project Mill Levy. The Pledged Project Mill Levy Revenues shall be
pledged pursuant to the Capital Pledge Agreement for payment of the Owners ' Share.
3A Project Fees. The Service Plan for the Interchange District shall authorize such
District to impose Project Fees , which shall be pledged pursuant to the Capital Pledge
Agreement for payment of the Owners ' Share.
3 . 5 District Fees and Development Mill Levy. In addition to providing for payment
of the Owners ' Share by the Interchange District, the Owners intend to use the Development
Metropolitan Districts to pay eligible public improvement costs related to the development of
their respective Properties. Subject to the provisions set forth in the Service Plans and in Section
2.2 hereof relating to the recording of the Interchange PIF Covenant against all Properties , each
Development Metropolitan District shall have the right to charge District Fees and impose a
Development Mill Levy, and such revenues shall not be required to be pledged to the City for
payment of the Owners ' Share,
3 . 6 Capital Pledge Agreement. The Owners hereby acknowledge that pursuant to
the provisions of the Service Plans , the Development Metropolitan Districts are not authorized to
impose the Development Mill Levy, impose any District Fees , or issue any debt until the
Interchange District and the City execute and deliver the Capital Pledge Agreement.
ARTICLE 4
CITY FUNDING OF PROJECT
4. 1 City Funding of Project. The City agrees that, subject to annual appropriation
by the City Council , it shall fund all the costs of the Project that are not being paid by CDOT.
The Parties acknowledge and agree that the Owner' s Share shall not be increased or decreased in
the event of cost overruns or cost savings in connection with the Project.
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ARTICLE 5
TERM
5 . 1 Conditions Subsequent; Term. The Parties acknowledge that the Interchange
District is submitting the necessary ballot questions to its electorate at the Election, that will
authorize the organization of the Interchange District and approve ballot questions that authorize
the imposition of the Project Mill Levy and the execution and delivery of the Capital Pledge
Agreement, in compliance with TABOR and any other applicable law. In the event that (a) the
Election is not held on May 8 , 2018 , or (b) the ballot questions are not approved, or (c) the
Interchange District does not execute the Capital Pledge Agreement at its first meeting of the
Board after the Election, this Agreement shall terminate and be of no further force and effect. In
the event that the Election is held, the ballot questions are approved at the Election, and the
Capital Pledge Agreement is executed and delivered by the Interchange District, this Agreement
shall remain in full force and effect until the payment in full of the Owners ' Share.
ARTICLE 6
DEFAULT & REMEDIES
6. 1 Default & Remedies. If any Party fails to perform or observe any obligation or
condition required by this Agreement (a "Defaulting Party ') , a Party not in default (a "Non-
Defaulting Party") may deliver written notice to the Defaulting Party specifically describing
such default or defaults ("Default Notice") . The Defaulting Party shall , after receipt of the
Default Notice, have thirty (30) days to cure the default or defaults described in the Default
Notice, unless the default or defaults cannot reasonably be cured within thirty (30) days, then the
Defaulting Party shall have ninety (90) days after receipt of written notice from the Non-
Defaulting Party to cure (collectively, the "Cure Period") . If any default described in the
Default Notice remains uncured after expiration of the Cure Period, a Non-Defaulting Party may,
as its sole remedies, seek specific performance or injunctive relief. In no event shall any Party be
liable for damages, including, but not limited to, punitive, exemplary, or consequential damages ,
including, without limitation, lost profits , whatever the nature of a breach by any other Party of
its obligations under this Agreement, and the Parties hereby waive all claims for damages,
including, but not limited to, punitive, exemplary, or consequential damages .
ARTICLE 7
MISCELLANEOUS.
T 1 Cooperation. The Parties agree to cooperate on a reasonable basis upon
execution of this Agreement to complete any item contemplated herein that is not completed
prior to the Effective Date.
T2 Representatives and Notice. The Parties ' respective designated representatives
and legal counsel for negotiations and communications concerning the Agreement, and their
contact information, are as follows :
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For the City: Mike Beckstead
Chief Financial Officer
300 LaPorte Avenue
PO Box 580
Fort Collins, CO 80524
970-221 -6795
mbeckstead@fcgov.com
John Duval
Deputy City Attorney
300 LaPorte Avenue
PO Box 580
Fort Collins, CO 80524
970-416-2488
jduval@fcgov.com
For FCIC and GAPA: Fort Collins/I-25 Interchange Corner, LLC and/or
Gateway at Prospect Apartments , LLC
c/o Neihart Land Company, LLC
580 Hidden Valley Road
Colorado Springs, CO 80919
Attn : R . Tim McKenna
719-641 -6527
tim.mckenna@neihartland.com
With a copy to : Brownstein Hyatt Farber Schreck, LLP
410 17'h Street, Suite 2200
Denver, CO 80202
Attn : Carolynne C. White, Esq .
303 -223 - 1197
cwhite@BHFS .com
For the TIC Owners : Land Acquisition and Management, LLC
#4 West Dry Creek Cr, Suite 100
Littleton , CO 80120
Attn : Rick White
303 -601 -5463
rwhite@laam.biz
With a copy to : Kutak Rock LLP
1801 California Street, Suite 3100
Denver, Colorado 80202
Attn : Daniel C . Lynch, Esq.
303 -292-7875
dan.lynch@kutakrock.com
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And a copy to: Kutak Rock LLP
1801 California Street, Suite 3100
Denver, Colorado 80202
Attn: Robert C . Roth, Jr. , Esq . ,
(303) 292-7802
Robert.RothJr@KutakRock.com
For Paradigm: Paradigm Properties, LLC
2300 Knoll Drive, Suite A, 2"d Floor
Ventura, CA 93003
Attn: Jeffrey Hill
jeffreyahill@gmail .com
With a copy to : Kutak Rock LLP
1801 California Street, Suite 3100
Denver, Colorado 80202
Attn : Daniel C . Lynch, Esq.
303 -292-7875
dan . lynch @ kutakrock.com
For CSURF: Colorado State University. Research Foundation
2537 Research Boulevard, Suite 200
Fort Collins , CO 80526
Attn : Rick Callan
Senior Real Estate Analyst
970-492-4502
Rick. Callan@colostate.edu
With a copy to : Colorado State University Research Foundation
2537 Research Boulevard, Suite 200
Fort Collins, CO 80526
Attn: Donna.Baily, Esq .
Senior Legal Counsel
970-492-4506
Donna.Baily@colostate.edu
All notices or documents delivered or required to be delivered under the provisions of
this Agreement shall be deemed received one day after hand delivery or three days after mailing.
Any party by written notice so provided may change the address to which future notices shall be
sent, and may provide the manner in which notices may be given, including without limitation,
electronic mail.
7 . 3 Recordation of Agreement. This Agreement shall not be recorded in the office
of the Larimer County Clerk and Recorder.
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7A General Provisions .
(a) This Agreement and the Capital Pledge Agreement constitute the final,
complete, and exclusive statement of the terms of the agreement between the Parties
pertaining to the subject matter of this Agreement and the Capital Pledge Agreement and
supersede all prior and contemporaneous understandings or agreements of the Parties ,
including without limitation, the MOU. This Agreement may not be contradicted by
evidence of any prior or contemporaneous statements or agreements . No Party has been
induced to enter into this Agreement by, nor is any party relying on, any representation,
understanding, agreement, commitment, or warranty except those expressly set forth in
this Agreement.
(b) If any term or provision of this Agreement is determined to be illegal,
unenforceable, or invalid in whole or in part for any reason, such illegal , unenforceable,
or invalid provisions or part thereof shall be stricken from this Agreement, and such
provision shall not affect the legality, enforceability, or validity of the remainder of this
Agreement. If any provision or part thereof of this Agreement is stricken in accordance
with the provisions hereof, then such stricken provision shall be replaced, to the extent
possible, with a legal, enforceable, and valid provision that is as similar in tenor to the
stricken provision as is legally possible.
(c) It is intended that there be no third-party beneficiaries of this Agreement.
Nothing contained herein, expressed or implied, is intended to give to any person other
than the Parties any claim, remedy, or right under or pursuant hereto, and any agreement,
condition, covenant, or term contained herein required to be observed or performed by or
on behalf of any Party hereto shall be for the sole and exclusive benefit of the other Party.
(d) This Agreement may not be assigned or transferred by any Party without
the prior written consent of all the other Parties . Any such assignment or transfer without
the required prior written consent shall be deemed null and void and of no effect.
(e) This Agreement shall be governed by and construed under the applicable
laws of the State of Colorado . Venue for any judicial action to interpret or enforce this
Agreement shall be in Larimer County District Court of the Eighth Judicial District for
the State of Colorado.
(f) This Agreement may be amended or supplemented by the Parties , but any
such amendment or supplement must be in writing and must be executed by all the
Parties .
(g) If the date for making any payment or performing any action hereunder
shall be a legal holiday or a day on which banks in Denver, Colorado are authorized or
required by law to remain closed, such payment may be made or act performed on the
next succeeding day which is not a legal holiday or a day on which banks in Denver,
Colorado are authorized or required by law to remain closed.
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(h) Each of the Parties has participated fully in the review and revision of this
Agreement. Any rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not apply in interpreting this Agreement. The language in
this Agreement shall be interpreted as to its fair meaning and not strictly for or against
any Party.
(i) This Agreement may be executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same instrument.
0 ) The Parties each covenant that they will do, execute, acknowledge, and
deliver or cause to be done, executed, acknowledged, and delivered, such acts ,
instruments, and transfers as may reasonably be required for the performance of their
respective obligations hereunder.
(k) This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors and assigns .
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IN WITNESS WHEREOF, the Parties have executed this Agreement as the date and
year first above written.
FCIC :
FORT COLLINS/I-25 INTERCHANGE CORNER, LLC,
a Colorado limited liability company
By: MCKENNA MANAGEMENT, LLC,
a Colorado limited liability company
its co-Manager
By:
Name: R. Tim McKenna
Title: Manager
[Signatures continue on following page(s)]
GAPA :
GATEWAY AT PROSPECT APARTMENTS , LLC,
a Colorado limited liability company
By: MCKENNA MANAGEMENT, LLC ,
a Colorado limited liability company
its co-Manager
By:
Name : R. Tim McKenna
Title : Manager
[Signatures continue on following page(s)]
TIC Owners:
TENANTS-IN-COMMON
CW SUBTRUST
By:
David B . White, Trustee
M. JENNET WHITE, an Individual
CHRISTOPHER WHITE , an Individual
TENANTS-IN-COMMON
ERIC S. WHITE , an Individual
JANE E. WHITE, an Individual
JASON R. WHITE, an Individual
DANIEL A. WHITE , an Individual
TENANTS-IN-COMMON
NEW DIRECTION IRA, INC. FBO BARBARA
ANN MEDINA IRA
By:
Name:
Title:
Approved :
Barbara Medina
BOOREN LIMITED LIABILITY LIMITED
PARTNERSHIP
By:
Steven M. Booren, General Partner
By:
Marie S. Booren, General Partner
DUNKIN LIMITED LIABILITY LIMITED
PARTNERSHIP
By:
Douglas S. Dunkin, General Partner
By:
Karrie L. Dunkin, General Partner
TENANTS-IN-COMMON
LAURA SNORTLAND FAIRFIELD, an Individual
ROBERT C. ROTH, JR., an Individual
ROBERT TAYLOR, an Individual
[Signatures continue on followingpage(s)]
Paradigm:
PARADIGM PROPERTIES , LLC,
a California limited liability company
By:
Name : Jeffrey A. Hill
Title: Managing Member
[Signatures continue on following page(s)]
CSURF :
COLORADO STATE UNIVERSITY RESEARCH FOUNDATION,
a Colorado nonprofit corporation
By:
Name: Kathleen Henry
Title: CEO and President
[Signatures continue on following page(s)]
40941666.v l
CITY OF FORT COLLINS . COLORADO
a municipal corporation
By:
Mayor
ATTEST:
City Clerk
APPROVED AS TO FORM:
Deputy City Attorney
[Signatures end]
40941666.0
EXHIBIT A
MASTER GLOSSARY OF TERMS
"Binding Agreement" means the Binding Agreement Concerning the Development of
Interstate Highway 25 and Prospect Road Interchange by and among the City and the Owners.
"Capital Pledge Agreement" means the Capital Pledge Agreement by and between the
Interchange District and the City.
"Carryover Costs " has the meaning set forth in Section 2 . 04(d) of the Capital Pledge
Agreement.
"CD07" means the Colorado Department of Transportation.
"Certificates of Participation " means the Certificates of Participation that are expected to
be executed and delivered to finance a portion of the costs of the Interchange Project that are not
being paid by CDOT or Timnath. If the Certificates of Participation finance more than one project,
the term "Certificates of Participation" shall mean only that pro rata portion of such Certificates
that are allocable to the financing of the Interchange Project.
"City" means the City of Fort Collins, a home rule municipality and political subdivision
of the State of Colorado.
"City Council" means the City Council of the City.
"CSURF" means the Colorado State University Research Foundation, a Colorado nonprofit
corporation.
"CSURF Parcels" means the property owned by CSURF and generally described in the
MOU.
"Development Metropolitan Districts" means, collectively, Gateway at Prospect
Metropolitan District Nos. 1 -7; Rudolph Farms Metropolitan District Nos. 1 -6; and SW Prospect
I25 Metropolitan District Nos. 1 -7.
"Development Mill Levy" means each of the mill levies imposed by the Development
Metropolitan Districts.
"Districts " means and includes the Interchange District and the Development Metropolitan
Districts .
"District Act" means Title 32, Article 1 , Colorado Revised Statutes, as amended.
"District Fees" means and includes the fees imposed by the Development Metropolitan
Districts pursuant to the District Act for services, programs or facilities furnished or to be furnished
by them. District Fees are not required to be pledged as security for the obligations of the
Interchange District.
1
"Election " means the election to be held by the Interchange District on May 8 , 2018 .
"Eligible Operational Costs "means the actual and reasonable operating and administrative
expenses incurred by the Interchange District each year in an amount that does not exceed that
amount budgeted by the Interchange District for operating and administrative expenses in such
year, as such budget may be amended in accordance with the Capital Pledge Agreement. Revenues
generated from the Project Mill Levy may be applied by the District to the payment of Eligible
Operational Costs and the Interchange District shall receive a credit against the Owners' Share in
each year in an amount equal to the Eligible Operational Costs for such year, as further set forth
in the Capital Pledge Agreement.
"FCIC' means Fort Collins/ 1 -25 Interchange Comer, LLC, a Colorado limited liability
Company.
"FCIC Parcel" means the property owned by FCIC and generally described in the MOU.
"Formation Costs " means the reasonable and necessary costs, fees and expenses, including
attorneys' fees, costs and expenses, incurred by the Owners or the Interchange District in
connection with the formation of the Interchange District, including without limitation, drafting
and negotiating the service plan for the Interchange District, the preparation of the financing plan
attached to the service plan, and the costs of the Election. Formation Costs shall also include the
share of the costs of drafting and negotiating the Binding Agreement and the Capital Pledge
Agreement that are reasonably related and allocable to the formation of the Interchange District.
Formation Costs shall not include the costs incurred in connection with the formation of the
Development Districts . Revenues generated from the Project Mill Levy may be applied by the
Interchange District to the payment or reimbursement of Formation Costs in an amount not
exceeding $200 ,000 as further set forth in the Capital Pledge Agreement. The Interchange
District shall not receive a credit against the Owners' Share in an amount equal to the Formation
Costs .
"GAPA " means Gateway at Prospect Apartments , LLC, a Colorado limited liability
company.
"GAPAParcel" means the property owned by GAPA and generally described in the MOU.
"InterchangeDistricf 'means the 1 -25/Prospect Interchange Metropolitan District formed
pursuant to the District Act and having boundaries which include all of the Owners' Properties .
"Interchange " means the highway interchange currently located at Interstate Highway 1-
25 and Prospect Road in the City.
"Interchange District Financing Costs " means the reasonable costs of issuance incurred
in connection with the execution and delivery of the Certificates of Participation that are allocable
to the financing of the Owners' Share with a portion of the proceeds of the Certificates of
Participation, including, without limitation, the fees and expenses of bond counsel, disclosure
counsel and counsel to the underwriter, trustee fees and expenses, rating agency fees, insurance
premiums, capitalized interest, and similar fees and expenses . If the Certificates of Participation
are executed and delivered prior to the ROW Credit being granted, the percentage of costs of
2
issuance to be allocated to the Interchange District shall be equal to $7,550,000 divided by the
total net proceeds of the Certificates of Participation to be applied to finance the Interchange
Project (in a total amount not exceeding $ 19,000,000) . If the ROW Credit has been granted prior
to the execution and delivery of the Certificates of Participation, the percentage of costs of issuance
to be allocated to the Interchange District shall be equal to $7,050,000 divided by the total net
proceeds of the Certificates to be applied to finance the Interchange Project (in a total amount not
exceeding $ 18,500,000). Notwithstanding the foregoing, in no event shall the Interchange District
Financing Costs exceed an amount equal to two percent (2%) of the principal amount of the
Owners ' Share as calculated at the time the Certificates of Participation are executed and delivered.
"Interchange PIF " means a PIF imposed on the Properties at a rate of 0. 75% on all future
retail sales on the Properties that are subject to the City' s sales tax under Article III in City Code
Chapter 25 .
"Interchange PIF Collection Agent " means, collectively, an entity or entities retained by
the Owners, as the declarants under the applicable Interchange PIF Covenant, with the approval of
the Interchange District, for the purpose of collecting, accounting for, and disbursing the
Interchange PIF revenue in accordance with the applicable Interchange PIF Covenant. The Owners
shall not be required to have one entity serve as Interchange PIF Collection Agent for all the
Interchange PIF Covenants.
"Interchange PIF Collection Agreement " means an agreement or agreements related to the
collection and remittance of the Interchange PIF revenue between the applicable Owner and the
Interchange PIF Collection Agent. Any of the other Owners and the Interchange District may also
be parties to the PIF Collection Agreement.
"Interchange PIF Covenant" means the recorded instrument by which an Interchange PIF
is imposed.
"MOU" the Memorandum of Understanding dated as of January 30, 2018 , by and among
the City and the Owners or their authorized representatives.
"Owners" or "Property Owners " means and includes FCIC, GAPA, the TIC Owners,
Paradigm and CSURF.
"Owners ' Share" means the share of the cost of the Project to be funded by the Interchange
District in accordance with the terms and provisions of the Binding Agreement and the Capital
Pledge Agreement. The Owners ' Share shall be funded solely from the Pledged Revenues.
"Paradigm" means Paradigm Properties LLC, a California limited liability company.
"Paradigm Parcels" means the two parcels of land owned by Paradigm and generally
described in the MOU.
"Parties" means, collectively, the parties to the Binding Agreement or the Capital Pledge
Agreement, as applicable.
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"Payment Schedule " means the schedule that sets forth the Owners ' Share payments due
in each year, including both a principal component and an interest component, as further set forth
in the Capital Pledge Agreement.
"PIF' means and includes any fee imposed for the provision of public improvements or
services within the whole or any portion of the Interchange District or any District by the recording
of covenants binding and running with any or all of the Properties by the Owners thereof.
"PIF Collection Agent " means the entity or agent retained to collect the Interchange PIF.
"Pledged Project Mill Levy Revenues " means the revenues derived from the Project Mill
Levy, net of (a) any reasonable costs of collection, (b) Formation Costs, (c) Eligible Operational
Costs paid by the Interchange District, and (d) any Carryover Costs.
"Pledged Revenues " means the following:
(a) Pledged Project Mill Levy Revenues;
(b) revenues generated from the Project Fees;
(c) revenues generated from the Interchange PIF, net of any reasonable costs of
collection; and
(d) any other legally available moneys which the Interchange District
determines, in its sole discretion, to apply to the payment of the Owners '
Share.
"Project" means the project to significantly modify and improve the Interchange by
reconstructing its ramps and bridge and by reconstructing Prospect Road to a configuration with
four through lanes, a raised median, left turn lanes and pedestrian and bicycle facilities, together
with the Urban Design Features. The Project will be funded cooperatively by CDOT, the City,
Timnath and the Interchange District, pursuant to the Binding Agreement, the Capital Pledge
Agreement and the Timnath Agreement.
"Project Fees" means fees imposed by the Interchange District pursuant to the Capital
Pledge Agreement that are pledged to the payment of the Owners ' Share. The Project Fees shall
be imposed in accordance with Exhibit A attached hereto and by this reference made a part hereof.
Project Fees shall not be pledged as security for obligations of the Development Metropolitan
Districts.
"Project Mill Levy " means a general ad valorem property tax levy imposed by the
Interchange District at a rate not less than 7 . 5 mills and not more than 10 mills in accordance with
the Capital Pledge Agreement. In the event the method of calculating assessed valuation is
changed after January 1 , 2018 , such minimum or maximum mill levy, as applicable, will be
increased or decreased to reflect such changes, such increases to be determined by the Board of
the Interchange District in good faith (and such determination to be binding and final) so that to
the extent possible, the actual tax revenues generated by such mill levy, as adjusted, are neither
diminished nor enhanced as a result of such changes . For purposes of the foregoing, a change in
4
the ratio of actual valuation to assessed valuation shall be deemed a change in the method of
calculating assessed valuation.
"Project ROW' means those portions of the Properties to be used as rights of way for the
Project, whether acquired by CDOT from the Property Owners by condemnation or purchase.
"Properties" means and includes the CSURF Parcels, FCIC Parcel, GAPA Parcel, TIC
Owners Parcel and the Paradigm Parcels .
"Property Owners" means and includes FCIC, GAPA, the TIC Owners, Paradigm and
CSURF.
"ROW Credit" means a credit to be applied by the City against the payment of the Owners '
Share in the amount of $500,000, subject to the conditions stated in Section 2.3 of the Binding
Agreement.
"Service Plan" means and includes the service plan filed pursuant to the District Act with
respect to each of the Districts.
"Service Plans" means, collectively, all of the Service Plans.
"Supplemental Act " means Part 2 of Article 57, Title 11 , C.R. S .
" TCEF' means the City Transportation Capital Expansion Fee that is imposed pursuant to
Fort Collins Code Section 7 . 5-32.
" TCEF Credit" means a credit to be applied by the City against the payment of the Owners '
Share in an amount equal to $700,000 . The TCEF Credit shall be applied at the time of execution
and delivery of the Binding Agreement.
"TABOR " means Colo . Const. Art. X, Sec. 20 .
"TIC Owners" means the CW Subtrust, M. Jennet White, Christopher White, Eric. S .
White, Jane E. White, Jason R. White, Daniel A. White, New Direction IRA, Inc . FBO Barbara
Ann Medina IRA, Booren Limited Liability Partnership, Dunkin Limited Liability Limited
Partnership, Laura Snortland Fairfield, Robert C. Roth, Jr. and Robert Taylor, as tenants in
common.
" TIC Owners Parcel" means, collectively, the parcel or parcels owned by the TIC Owners
and generally described in the MOU as the LAAM Parcels.
" Timnath" means the Town of Timnath, Colorado .
" Timnath Agreement" means the agreement between the City and Timnath, providing for
Timnath' s reimbursement to the City of a portion of the costs of the Project.
" Urban Design Features" means certain design improvements in the Project required under
the City' s development standards, that will add approximately $7,000,000 to the cost of the
5
Project, which improvements are generally described on Exhibit B attached hereto and by this
reference made a part hereof.
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Exhibit A
Project Fees Schedule by Land Use Type
Land Use Type Fee / Acre Fee / Unit
Light Industrial ( Code 110) $2,400 N/A
50k+ GLA Commercial (Shopping Center - Code 820) $ 12,200 N/A
Convenience Store ( Code 853) $50,000 N/A
200k+ GLA Office (Code 710) $3,200 N/A
Hotel (Code 310) N/A $310,00
Single Family Detached Residential (Code 210) N /A $350900
Single Family Attached ( Code 220) N/A $270,00
Multi- Family (Code 221 ) N/A $200.00
Exhibit B
Urban Design Features
7graded
ENHANCEMENTS
Concrete Stain on Bridge Curb, Girders, MSE Walls X
Pedestrian Rail on Bride X
Median & Pork Chop Island Cover Material Color Concrete X
Irrigation Sleeves and Pull Boxes X
GORE AREAS AND RAMPS
Earthwork/Import related to Landscape/Urban Design) X
Stone Outcrops (including design, mock ups, installation X
Boulders X
Cobble Swales X
Turf Reinforcement Mat X
Seed X
Boulders X
Irrigation Design X
Irrigation Tap, Meter & Backflow X
Irrigation Sleeves X
PROSPECT ROAD
Prospect Rd. Median - Perforated Pipe Underdrain X
Prospect Rd. Median — Membrane X
Prospect Rd. Median — Rock Filter Material X
Prospect Rd. Median - Topsoil X
Prospect Rd. Median — Double Curb X
Electrical conduit for City Street Lights X
Seed X
Turf Reinforcement Mat X
Irrigation Design X
Irrigation Tap, Meter & Backflow X
Irrigation Sleeves X
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EXHIBIT B
CAPITAL PLEDGE AGREEMENT
This CAPITAL PLEDGE AGREEMENT, made and entered into as of 2018
(this "Capital Pledge Agreement" or this "Agreement"), by and between the I-25/PROSPECT
INTERCHANGE METROPOLITAN DISTRICT, a special district organized and existing under
the laws of the State of Colorado (the "Interchange District") and the CITY OF FORT COLLINS ,
a Colorado home rule municipality (the "City") (each a "Party" and jointly the "Parties),
WITNESSETH.
WHEREAS, pursuant to a Memorandum of Understanding dated as of January 30, 2018
(the "MOU") by and among the City and the other parties identified therein (the "Owners"), the
City and the Owners established a non-binding outline of documents and terms to be negotiated
for the sharing of costs of improvements to the highway interchange at Interstate Highway 1-25
and Prospect Road in the City; and
WHEREAS, one of the documents contemplated by the MOU was an intergovernmental
agreement between the Interchange District and the City, identified as the Capital Pledge
Agreement, whereby the Interchange District would pledge certain revenues as security for its
obligation to pay the Owners ' Share of the cost of such improvements; and
WHEREAS , this Agreement shall constitute the Capital Pledge Agreement contemplated
by the MOU;
NOW, THEREFORE, for and in consideration of the promises and mutual covenants and
understandings herein, the Parties hereby agree as follows :
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1 .01 . Definitions. Capitalized terms used herein and not defined in the Recitals
above or elsewhere in this Agreement shall have the meanings, respectively, specified in Appendix
A hereto .
Section 1 .02. Interpretation . In this Agreement, unless the context expressly indicates
otherwise, the following words shall be interpreted as set forth below:
(a) The words "herein," "hereunder," "hereby," "hereto," "hereof and any
similar words, refer to this Agreement as a whole and not to any particular article, section,
or subdivision hereof; the word "heretofore" means before the date of execution of the
Agreement; and the term "hereafter" means after the date of execution of this Agreement.
(b) All definitions, terms, and words shall include both the singular and the
plural, and, except as otherwise expressly defined in the text of this Agreement, all
capitalized words or terms shall have the meanings specified in Appendix A attached
hereto.
(c) Words of the masculine gender include correlative words of the feminine
and neuter genders, and words importing the singular number include the plural number
and vice versa.
(d) The captions or headings of this Agreement are for convenience only, and
in no way define, limit, or describe the scope or intent of any provision, article, or section
of this Agreement.
(e) All schedules, exhibits, and addenda referred to herein are incorporated
herein by this reference.
ARTICLE II
FUNDING OF THE PROJECT; PAYMENT OBLIGATION
Section 2.01 . Covenant of the City to Finance Project. The City agrees that, subject to
annual appropriation by the City Council, it shall fund all the costs of the Project that are not being
paid by CDOT. The City expects to finance a portion of such costs through the execution and
delivery of the Certificates of Participation.
Section 2.02. Calculation of Owners ' Share. The Owners ' Share shall be the share of
the costs of the Project to be funded by the Interchange District in accordance with the terms and
provisions of the Binding Agreement and this Capital Pledge Agreement. The Owners agreed to
fund costs of the Project in the amount of $ 8,250,000, plus financing costs and interest as provided
in this Agreement. In connection with the execution and delivery of the Binding Agreement, the
City granted the TCEF Credit in the amount of $700,000, which reduced the amount that the
Owners ' agreed to pay to fund the Project to $7, 550,000, plus financing costs and interest. The
City has agreed in the Binding Agreement to grant the ROW Credit in the amount of $500,000 to
further reduce the principal amount of the Owners ' Share upon compliance with the provisions set
forth in Section 2 . 3 of the Binding Agreement.
The initial principal amount of the Owners ' Share shall be calculated on the date of
execution and delivery of the Certificates of Participation. The principal amount of the Owners '
Share shall be an amount equal to $7, 550,000, plus the Interchange District Financing Costs, less
the ROW Credit to the extent that the ROW Credit has been granted on or prior to the execution
and delivery of the Certificates of Participation. Upon the execution and delivery of the
Certificates of Participation, the City shall determine the Interchange District Financing Costs
which shall be added to the principal amount of the Owners' Share . The principal amount of the
Owners ' Share shall bear per annum interest at the net effective interest rate borne by the
Certificates of Participation beginning on the date of execution and delivery of the Certificates of
Participation. The City shall prepare or cause to be prepared a Payment Schedule that sets forth a
twenty year principal amortization of the Owners ' Share, bearing interest at the net effective
interest rate on the Certificates of Participation, with level debt service payments rounded to the
nearest $ 1000. The Payment Schedule shall set forth the principal amount due in each year, plus
2
the interest due in each year. The City shall remit such Payment Schedule to the Interchange
District and the Owners, and such Payment Schedule shall be binding on the Parties absent
manifest error.
In the event that all of the outstanding Certificates of Participation are refinanced by the
City at a lower interest rate, the interest rate on the Owners' Share shall be reduced to the net
effective interest rate borne by the refunding certificates or other refunding obligations, and the
City shall prepare a revised Payment Schedule reflecting the lower interest rate.
The Interchange District acknowledges and agrees that the obligation to pay the Owners '
Share is not contingent on the Certificates of Participation remaining outstanding. The obligation
to pay the Owners ' Share shall continue notwithstanding that the City may prepay all or any portion
of the outstanding Certificates of Participation, or that an event of default or an event of non=
appropriation may occur under the lease documents relating to the Certificates of Participation.
Section 2.03. Funding of Owners ' Share.
The Interchange District agrees to fund the Owners' Share solely from the Pledged
Revenues, as follows :
(a) The Owners ' Share shall be payable in twenty installments in the amount
set forth in the Payment Schedule on or prior to December 1 of each year, beginning
December 1 , 2019, subject to adjustment for prepayment of principal and the ROW Credit
as hereinafter set forth.
(b) On or prior to the last day of each month, the Interchange District shall remit
or cause to be remitted to the City all Pledged Revenues that it or the PIF Collection Agent
received through the last day of the prior month. The City shall provide written
acknowledgement to the Interchange District of the receipt of such Pledged Revenues,
including the amount of Project Fee revenues that have been collected and retained by the
City pursuant to Section 2 . 05 hereof.
(c) On or prior to December 1 of any given year, the Interchange District shall
provide written notice to the City of the amount of revenues from the Project Mill Levy
that have been applied to the payment or reimbursement of Formation Costs, if any. The
Interchange District shall have the right to apply revenues from the Project Mill Levy to
the repayment or reimbursement of Formation Costs, but the Interchange District shall not
receive a credit toward the Owners ' Share in the event of such repayment or
reimbursement.
(d) On or prior to December 1 of any given year, the Interchange District shall
also provide written notice to the City of the Eligible Operational Costs incurred by the
Interchange District in such year, together with any documentation of such Eligible
Operational Costs as reasonably requested by the City. The amount of the Eligible
Operational Costs incurred by the Interchange District in each year shall be applied as a
credit (i) first toward the interest due on the Owners' Share in such year, and (ii) second
toward the principal amount of the Owners ' Share due in such year.
3
(e) In the event that on December 1 of any given year the amount of Pledged
Revenues remitted to the City in such year, plus the amount of the Eligible Operational
Costs for such year, are less than the Owners ' Share due on or prior to December 1 of such
year, after any credit as hereinafter set forth, the amount of any such deficit shall begin to
bear interest on December 1 of such year, until such deficit is paid, at a fixed rate equal to
the rate the City then charges under its "Inter-agency Loan Program" found in Section 8 . 8
of its "Financial Management Policy 8". Any Pledged Revenues thereafter remitted shall
be applied (i) first to any interest due on such deficit, (ii) second to the repayment of the
principal amount of such deficit that remains outstanding, (iii) third to the annual interest
payment due on or prior to the following December 1 , and (iv) fourth to the annual principal
payment due on or prior to the following December 1 . In the event that on December 1 of
any given year the amount of Pledged Revenues remitted to the City, plus the amount of
the Eligible Operational Costs for such year, are more than the amount of the Owners '
Share due on or prior to December 1 of such year, and any deficit from any prior years,
plus interest on any such deficit, have been paid in full, then such excess Pledged Revenues
shall be credited first against the interest amount of the Owners ' Share due in the next
subsequent year, and then against the principal amount of the Owners ' Share due in the
next subsequent year.
(f) No later than December 31 in each year, the City shall provide the
Interchange District with a summary of (i) the Pledged Revenues received in such year
through December 1 of such year, (ii) the amount of the Eligible Operational Costs credited
to the payment of the interest and principal of the Owners ' Share in such year, (iii) the
amount of any credit or deficit remaining as of December 1 of such year, (iv) the amount
of unpaid interest, if any, as of December 1 of such year, and (v) the total amount of the
Owners ' Share paid or credited through December 1 of such year.
(g) The Parties acknowledge and agree that so long as (i) the Project Mill Levy,
the Project Fees and the Interchange PIF are being imposed and collected in accordance
with the Binding Agreement and this Capital Pledged Agreement, and (ii) the Interchange
District is remitting or causing the remittance of all the Pledged Revenues to the City in
accordance with the provisions of this Capital Pledge Agreement, then in the event that
there are insufficient Pledged Revenues to pay the full amount of the Owners' Share due
in any year, this shall not constitute an event of default hereunder, but the unpaid amount
of the Owners ' Share shall remain outstanding until paid in full and interest shall accrue
on any payment deficit as set forth in Section 2 . 03 (e) hereof.
(h) The Interchange District may prepay the Owners ' Share in whole or in part
in any amount, on any date, without prepayment premium. Any such prepayment shall be
applied first to any unpaid interest due on the Owners ' Share. After any such unpaid
interest has been paid, the remainder of such prepayment may be applied against the
principal amounts due on the Owners' Share in inverse order of the principal payments
due, or pro-rata to payments that are due, or in such other manner as determined in writing
by the Interchange District. Upon any such partial prepayment, the Interchange District
shall provide the City with a revised Payment Schedule.
4
(i) The ROW Credit shall be applied as a credit against the principal amount
of the Owners' Share, as provided in Section 2 .3 of the Binding Agreement. Upon the
granting of such ROW Credit, the Owners have the right under the Binding Agreement to
determine how the ROW Credit will be applied against the principal amount of the Owners '
Share. Upon receipt of written notice by the Interchange District from the Owners of the
application of the ROW Credit, the Interchange District shall provide the City and the
Owners with the revised Payment Schedule reflecting such ROW Credit.
0) The obligation of the Interchange District to pay the Owners ' Share as
provided herein shall constitute a special and limited obligation of the Interchange District,
payable solely from and to the extent of the Pledged Revenues. The Pledged Revenues are
hereby pledged by the Interchange District to the City for the payment of the Owners '
Share. The Interchange District hereby elects to apply all of the provisions of the
Supplemental Act to this Capital Pledge Agreement and the payment obligations
hereunder.
(k) In no event shall the total or annual obligations of the Interchange District
hereunder exceed the maximum amounts permitted under its electoral authority and
applicable law.
Section 2.04. Imposition of Project Mill Levy ; Eligible Operational Costs; Formation
Costs .
(a) In order to fund a portion of the Owners' Share and to pay for Eligible
Operational Costs and Formation Costs, the Interchange District agrees to levy on all of
the taxable property in such Interchange District, in addition to all other taxes, direct annual
taxes for collection in each of the years when this Agreement is in effect, in the amount of
the Project Mill Levy. The Pledged Project Mill Levy Revenues shall be included in the
Pledged Revenues and applied as provided herein.
(b) The Interchange District shall provide the City with an itemization of the
Formation Costs incurred by the Interchange District that are to be paid or reimbursed
from revenues generated from the Project Mill Levy, in an amount not exceeding
$200,000 . The City shall have the right to review the Formation Costs to confirm that
such costs, fees and expenses qualify as Formation Costs for purposes of this Agreement.
Upon receipt of the net revenues generated from the Project Mill Levy, and after the
City' s confirmation of the Formation Costs, the Interchange District may apply such
revenues to the payment or reimbursement of all or any portion of the Formation Costs
until such Formation Costs are paid or reimbursed in full. The Interchange District
acknowledges and agrees that it shall not receive a credit against the Owners' Share to the
extent that it applies revenues from the Project Mill Levy to the payment of all or any
portion of the Formation Costs.
( c) The Interchange District shall provide the City with a copy of its proposed
budget for the subsequent fiscal year setting forth the amount of administrative and
operating expenses budgeted for the Interchange District for the subsequent fiscal year. If
a budget amendment is required due to circumstances that could not have been reasonably
foreseen at the time the original budget was adopted, the Interchange District shall provide
5
the City with a copy of the proposed budget amendment setting forth the amount of
additional administrative and operating expenses anticipated for the applicable year, and
the reason for the increase. The City shall have the right to review the budget and any
subsequent budget amendment to confirm that the amount so budgeted for administrative
and operating expenses is reasonable, and that any amendment to the budget was the result
of circumstances that could not have been reasonably foreseen. The Eligible Operational
Costs for any year shall not exceed the amount set forth in the budget and any such budget
amendment, as reviewed and approved by the City. The Interchange District agrees that
any administrative and operating costs incurred by the Interchange District that exceed the
amount so budgeted for any year, including any approved budget amendment, shall not
constitute Eligible Operational Costs for purposes of this Agreement and shall not be paid
or reimbursed from the revenues generated from the Project Mill Levy or any other Pledged
Revenues .
(d) Upon receipt of the net revenues generated from the Project Mill Levy, the
Interchange District may apply such revenues to the payment of Eligible Operational Costs
and any Carryover Costs (as hereinafter defined) . In the event that there are not sufficient
revenues generated from the Project Mill Levy in any year to pay the Eligible Operational
Costs, such deficit shall constitute "Carryover Costs" for purposes of this Agreement, and
the next available revenues generated from the Project Mill Levy may be applied first to
the repayment of these Carryover Costs. In the event that there are not sufficient revenues
generated from the Project Mill Levy in any year to pay any outstanding Carryover
Amounts and the Eligible Operational Costs in such year, any such deficit amount shall be
added to the outstanding Carryover Costs. The City acknowledges and agrees that the
Interchange District will receive a credit each year against the Owners ' Share in an amount
equal to the Eligible Operating Costs incurred by the Interchange District for such year, as
further set forth in Section 2 .03 (d) hereof.
(e) This Section 2 . 04 is hereby declared to be the certificate of the Interchange
District to the Board of County Commissioners of Larimer County indicating the aggregate
amount of taxes to be levied for purposes of this Agreement and the payment obligations
hereunder.
(f) It shall be the duty of the Interchange District annually at the time and in
the manner provided by law for the levying of the Interchange District' s taxes, if such
action shall be necessary to effectuate the provisions of this Agreement, to ratify and carry
out the provisions hereof with reference to the Project Mill Levy and collection of the
proceeds thereof, and to require the officers of the Interchange District to cause the
appropriate officials of Larimer County to levy the Project Mill Levy and to extend and
collect such taxes in the manner provided by law, for the purpose of providing funds for
the payment of the Owners ' Share promptly as the installments of the same, respectively,
become due. The proceeds of the Pledged Project Mill Levy Revenues, when collected,
shall be applied only to the payment of the Owners ' Share due hereunder.
(g) The Project Mill Levy shall be levied, assessed, collected, and enforced at
the time and in the form and manner and with like interest and penalties as other general
taxes in the State of Colorado.
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(h) The Interchange District shall pursue all reasonable efforts to collect, or
cause the collection of, delinquent ad valorem property taxes within its boundaries.
(i) Upon payment in full of the Owners ' Share, the Interchange District' s
obligation to impose the Project Mill Levy shall terminate.
(j) Nothing herein shall be construed to require the Interchange District to
impose an ad valorem property tax levy in excess of the Project Mill Levy. Except as
provided by the Service Plan of the Interchange District, nothing herein shall be construed
to prevent the Interchange District from imposing an ad valorem property tax levy in excess
of the Project Mill Levy to pay administrative expenses in excess of the Eligible
Operational Costs or for other lawful purposes.
Section 2.05. Imposition of Project Fees. In order to provide additional Pledged
Revenues to fund the Owners' Share, the Interchange District agrees to impose and collect or cause
the collection of the Project Fees, which Project Fees shall be included in the Pledged Revenues
and applied as provided herein. The Interchange District agrees to take all necessary and proper
steps promptly to adopt, impose and enforce the payment of Project Fees at the time of issuance
of each vertical development permit by the City. For the purpose of administering and facilitating
the collection of Project Fees, the City agrees to promptly notify the Interchange District whenever
application is made for a vertical building permit for structures or other improvements on any of
the Properties, and to collect the Project Fees on behalf of the Interchange District. The City shall
send written notice each month to the Interchange District as to the amount of Project Fees so
collected in such month. The City shall be allowed to retain the Project Fees so collected and shall
credit the Project Fees so collected, without deduction for any collection costs, to the amounts due
to the City hereunder, in accordance with Section 2. 03 hereof. The Interchange District shall not
modify, amend or repeal the resolution or resolutions imposing the Project Fees in any manner or
to any extent that would result in a reduction of the rates or amount of Project Fees without the
prior written consent of the City.
Upon payment in full of the Owners' Share, the Interchange District' s obligation to impose
the Project Fees shall terminate.
Section 2.06. Collection of PIF Revenues. As provided in the Binding Agreement, the
Owners have caused or will cause to be recorded with respect to the Properties in the Interchange
District the Interchange PIF Covenant, touching, concerning and running with the land, whereby
during the term of this Agreement there are to be collected and paid to the Interchange District the
proceeds derived from the imposition of a retail sales tax PIF at a rate equal to 0 . 75 %, net of any
reasonable administrative fees for collection, on all future retail sales on the Properties that are
also subject to the City' s sales taxes under Article III, Chapter 25 of the City Code, which amounts,
when and as received by the Interchange District, shall be included in the Pledged Revenues. The
Interchange PIF revenues shall be collected pursuant to the terms and provisions of the Interchange
PIF Collection Agreement. The City shall have the right to review the Interchange PIF Collection
Agreement to confirm compliance with the terms and provisions of the Binding Agreement and
this Capital Pledge Agreement.
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Section 2.07. Payment and Application of Pledged Revenues . On or prior to the last
day of each month, the Interchange District shall remit or cause to be remitted to the City all
Pledged Revenues that it or the PIF Collection Agent received through the last day of the prior
month. Such payment shall be made in lawful money of the United States of America by check
mailed or delivered, or by wire transfer, to the City or as otherwise directed by the City. The City
shall acknowledge in writing the receipt of all amounts paid to it by the Interchange District or the
PIF Collection Agent from Pledged Revenues.
The books and records of the Interchange District and the PIF Collection Agent pertaining
to the collection and receipt of the Pledged Revenues shall be open for inspection by the authorized
representatives of the City during business hours upon reasonable notice.
The books and records of the City pertaining to the collection and receipt of the Project
Fees shall be open for inspection by the authorized representatives of the Interchange District
during business hours upon reasonable notice. Such access shall be subject to the provisions of
the Colorado Open Records Act contained in Article 72 of Title 24, C .R. S . In the event of disputes
or litigation between the Parties hereto, all access and requests for such records shall be made in
compliance with the Colorado Open Records Act.
Section 2.08. Effectuation of Pledge of Security, Current Appropriation. The sums
required to pay the amounts due hereunder are hereby appropriated for that purpose, and said
amounts for each year shall be included in the annual budget and the appropriation measures to be
adopted or passed by the Board of the Interchange District in each year while any of the obligations
herein authorized are outstanding and unpaid. No provisions of any constitution, statute, resolution
or other order or measure enacted after the execution of this Agreement shall in any manner be
construed as limiting or impairing the obligation of the Interchange District under this Agreement
to impose and collect the Project Mill Levy, to impose and collect the Project Fees and to collect
the PIF ' s .
In addition, and without limiting the generality of the foregoing, the obligations of the
Interchange District to transfer or cause the transfer of funds to the City as provided herein shall
survive any court determination of the invalidity of this Capital Pledge Agreement as a result of a
failure, or alleged failure, of any of the directors of the Interchange District to properly disclose,
pursuant to State of Colorado law, any potential conflicts of interest related hereto in any way,
provided that such disclosure is made on the record of Interchange District' s meetings as set forth
in its official minutes.
Section 2.09. Limited Defenses ; Specific Performance. It is understood and agreed by
the Interchange District that its obligations hereunder are absolute, irrevocable, and unconditional
except as specifically stated herein, and so long as any obligation of the Interchange District
hereunder remains unfulfilled, any obligations remain outstanding or any costs in connection
therewith remain unpaid, such Interchange District agrees that notwithstanding any fact,
circumstance, dispute, or any other matter, it will not assert any rights of setoff, counterclaim,
estoppel, or other defenses to its payment obligations, or take or fail to take any action which
would delay a payment to the City or impair the City' s ability to receive payments due hereunder.
Notwithstanding that this Agreement specifically prohibits and limits defenses and claims of the
Interchange District, in the event the Interchange District believes that it has valid defenses, setoffs,
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counterclaims, or other claims other than specifically permitted by this Section 2. 09, it shall,
nevertheless, make all payments to the City as provided herein, and then may seek to recover such
payments by actions at law or in equity for damages or specific performance, respectively.
Section 2. 10. Future Exclusion of Property. The Interchange District shall not consent
to the exclusion of any real property from within its boundaries without the prior written consent
of the City Council, which consent shall be evidenced by resolution.
Section 2. 11 . Additional Covenants of the Interchange District. The Interchange
District additionally covenants as follows :
(a) The Interchange District will not issue or incur bonds, notes, or other
obligations payable in whole or in part from, or constituting a lien upon, the general ad
valorem taxes of such Interchange District (other than general ad valorem taxes imposed
for the purpose of funding operation, maintenance and administrative costs incurred by the
Interchange District, provided that such taxes are not imposed in excess of the amount
permitted under its Service Plan after first taking into account the imposition of the Project
Mill Levy), Project Fees or Interchange PIF ' s included in Pledged Revenues, other than
obligations subject to annual appropriation and which are expressly subject to the
obligations of the Interchange District hereunder, without the prior written consent of the
City.
(b) At least once a year in the time and manner provided by law, the Interchange
District will cause an audit to be performed of the financial records relating to its revenues
and expenditures . In addition, at least once a year in the time and manner provided by law,
the Interchange District will cause a budget to be prepared and adopted. Copies of the
budget and the audit will be filed and recorded in the places, time, and manner provided by
law.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01 . Representations and Warranties of the Interchange District. The
Interchange District hereby makes the following representations and warranties with respect to
itself.
(a) The Interchange District is a quasi-municipal corporation and political
subdivision duly organized and validly existing under the laws of the State.
(b) The Interchange District has all requisite corporate power and authority to
execute, deliver, and to perform its obligations under this Capital Pledge Agreement. The
Interchange District' s execution, delivery, and performance of this Capital Pledge
Agreement has been duly authorized by all necessary action. The authorization for
issuance of debt, fiscal year spending, revenue collections and other constitutional matters
requiring voter approval by the Interchange District for purposes of this Capital Pledge
Agreement was approved at the Election in accordance with law and pursuant to due notice.
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The performance of the terms of this Capital Pledge Agreement by the Interchange District
requires no further electoral approval.
(c) The Interchange District is not in violation of any of the applicable
provisions of law or any order of any court having jurisdiction in the matter, which
violation could reasonably be expected to materially adversely affect the ability of the
Interchange District to perform its obligations hereunder. The execution, delivery and
performance by the Interchange District of this Capital Pledge Agreement (i) will not
violate any provision of any applicable law or regulation or of any order, writ, judgment,
or decree of any court, arbitrator, or governmental authority, (ii) will not violate any
provision of any document or agreement constituting, regulating, or otherwise affecting the
operations or activities of the Interchange District in a manner that could reasonably be
expected to result in a material adverse effect upon its financial condition or ability to meet
its obligations when due, and (iii) will not violate any provision of, constitute a default
under, or result in the creation or imposition of any lien, mortgage, pledge, charge, security
interest, or encumbrance of any kind on any of the revenues or other assets of the
Interchange District pursuant to the provisions of any mortgage, indenture, contract,
agreement, or other undertaking to which the Interchange District is a party or which
purports to be binding upon the Interchange District or upon any of its revenues or other
assets which could reasonably be expected to result in a material adverse effect upon its
financial condition or ability to meet its obligations when due.
(d) The Interchange District has obtained all consents and approvals of, and has
made all registrations and declarations with any governmental authority or regulatory body
required for the execution, delivery, and performance by the Interchange District of this
Capital Pledge Agreement.
(e) There is no action, suit, inquiry, investigation, or proceeding to which the
Interchange District is a party, at law or in equity, before or by any court, arbitrator,
governmental or other board, body, or official which is pending in connection with any of
the transactions contemplated by this Capital Pledge Agreement nor, to the best knowledge
of the Interchange District is there any basis therefor, wherein an unfavorable decision,
ruling, or finding could reasonably be expected to have a material adverse effect on the
validity or enforceability of, or the authority or ability of the Interchange District to perform
its obligations under, this Capital Pledge Agreement.
(f) This Capital Pledge Agreement constitutes the legal, valid, and binding
obligation of the Interchange District, enforceable against the Interchange District in
accordance with its terms (except as such enforceability may be limited by bankruptcy,
moratorium, or other similar laws affecting creditors' rights generally and provided that
the application of equitable remedies is subject to the application of equitable principles) .
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ARTICLE IV
DEFAULT AND REMEDIES
Section 4.01 . Events of Default. The occurrence or existence of any one or more of the
following events shall be an "Event of Default" hereunder, and there shall be no default or Event
of Default hereunder except as provided in this Section:
(a) the Interchange District fails or refuses to impose the Project Mill Levy, or
the Project Fees, or to enforce its rights in connection with the Interchange PIF ' s, or to
remit or cause the remittance of the Pledged Revenues as required by the terms of this
Capital Pledge Agreement;
(b) any representation or warranty made by either Party in this Capital Pledge
Agreement proves to have been untrue or incomplete in any material respect when made;
(c) either party fails in the performance of any other of its covenants in this
Capital Pledge Agreement, and such failure continues for 60 days after written notice
specifying such default and requiring the same to be remedied is given to either of the
Parties hereto;
(d) the Interchange District commences proceedings for dissolution or
consolidation with another metropolitan district during the term of this Agreement; or
(e) (i) the Interchange District shall commence any case, proceeding, or other
action (A) under any existing or future law of any jurisdiction relating to bankruptcy,
insolvency, reorganization, or relief of debtors, seeking to have an order for relief entered
with respect to it or seeking to adjudicate it insolvent or bankrupt or seeking reorganization,
arrangement, adjustment, winding up, liquidation, dissolution, composition, or other relief
with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian,
or other similar official for itself or for any substantial part of its property, or shall make a
general assignment for the benefit of its creditors; or (ii) there shall be commenced against
it any case, proceeding, or other action of a nature referred to in clause (i) and the same
shall remain undismissed within 90 days following the date of filing; or (iii) there shall be
commenced against it any case, proceeding, or other action seeking issuance of a warrant
of attachment, execution, distraint, or similar process against all or any substantial part of
its property which results in the entry of an order for any such relief which shall not have
been vacated, discharged, stayed, or bonded pending appeal within 90 days from the entry
thereof; or (iv) it shall take action in furtherance of, or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clauses (i), (ii) or (iii) above ; or (v) it
shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its
debts as they become due.
Section 4.02. Remedies For Events of Default. Subject to Section 2 . 09 hereof, upon the
occurrence and continuation of an Event of Default, either Party may proceed to protect and
enforce its rights against the Party causing the Event of Default by mandamus or such other suit,
action, or special proceedings in equity or at law, in any court of competent jurisdiction, including,
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without limitation, an action for specific performance, provided that no special or consequential
damages shall be awarded in connection with any Event of Default hereunder. In the event of any
litigation or other proceeding to enforce any of the terms, covenants or conditions hereof, the
prevailing party in such litigation or other proceeding shall obtain, as part of its judgment or award,
its reasonable attorneys ' fees and costs.
ARTICLE V
MISCELLANEOUS
Section 5.01 . Pledge of Revenue. The creation, perfection, enforcement, and priority of
the pledge of the Pledged Revenues to secure or pay the payment obligations of the Interchange
District shall be governed by Section 11 -57-208 of the Supplemental Act and this Capital Pledge
Agreement. The Pledged Revenues shall immediately be subject to the lien of such pledge without
any physical delivery, filing, or further act. The lien of such pledge shall be valid, binding, and
enforceable as against all persons having claims of any kind in tort, contract, or otherwise against
any of the Interchange District irrespective of whether such persons have notice of such liens.
Section 5.02. No Recourse Against Officers, Agents or Owners . Pursuant to Section
I1 -57-209 of the Supplemental Act, if a member of the Board of Directors of the Interchange
District, or any officer or agent thereof, acts in good faith, no civil recourse shall be available
against such member, officer, or agent for payment of the payment obligations of the Interchange
District. Such recourse shall not be available either directly or indirectly through the Board or the
Interchange District, or otherwise, whether by virtue of any constitution, statute, rule of law,
enforcement of penalty, or otherwise. By the acceptance of this Capital Pledge Agreement and as
a part of the consideration hereof, the City specifically waives any such recourse. In addition to
the immunities provided by the Supplemental Act and this Section to such Board members, officers
or agents in their official capacities, there shall not be personal recourse to any Owner under any
provision of this Agreement.
Section 5.03. Conclusive Recital. Pursuant to Section 11 -57-210 of the Supplemental
Act, it is hereby recited that this Capital Pledge Agreement and each of the obligations of the
Interchange District hereunder are issued pursuant to the Supplemental Act, and such recital is
conclusive evidence of the validity and the regularity of this Capital Pledge Agreement and such
obligations after their delivery for value. The Interchange District hereby acknowledges the receipt
of value for the execution and delivery of this Capital Pledge Agreement and the issuance of the
obligations evidenced hereby, in the form of the City' s commitment to finance the Project in
accordance with the terms and provisions of the Binding Agreement and this Capital Pledge
Agreement, other good and valuable consideration.
Section 5.04. Limitation of Actions . Pursuant to Section 11 -57-212, C .R. S . , no legal or
equitable action brought with respect to any legislative acts or proceedings in connection with the
authorization, execution, or delivery of this Capital Pledge Agreement shall be commenced more
than thirty days after the authorization of this Capital Pledge Agreement.
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Section 5.05. Notices. Except as otherwise provided herein, all notices or payments
required to be given under this Agreement shall be in writing and shall be hand delivered or sent
by certified mail, return receipt requested, or air freight, to the following addresses :
I-25/ProspectInterchange
Metropolitan District:
With a copy to : White Bear Ankele Tanaka & Waldron
c/o Robert G. Rogers, Esq.
2154 E. Commons Ave, Suite 2000
Centennial, CO 80122
3034584800
rrogers@wbapc. com
City of Fort Collins: Mike Beckstead
Chief Financial Officer
300 LaPorte Avenue
PO Box 580
Fort Collins, CO 80524
970-221 -6795
mbeckstead@fcgov.com
With a copy to : John Duval
Deputy City Attorney
300 LaPorte Avenue
PO Box 580
Fort Collins, CO 80524
970-416-2488
jduval@fcgov.com
All notices or documents delivered or required to be delivered under the provisions of this
Agreement shall be deemed received one day after hand delivery or three days after mailing. Any
party by written notice so provided may change the address to which future notices shall be sent,
and may provide the manner in which notices may be given, including without limitation,
electronic mail .
Section 5.06. Findings and Determinations Relative to Service Plan and Electoral
Debt Limitations. The Board of Directors of the Interchange District has made, and by approval
of this Capital Pledge Agreement hereby makes, the following findings and determinations relative
to the limitations on indebtedness set forth in its Service Plan and applicable electoral
authorization:
(a) Pursuant to its Service Plan, Interchange District is permitted to issue
"Debt" (as defined therein) in the maximum principal amount of $ 10 million. The
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maximum principal amount, total repayment cost and annual repayment cost of the Debt
of the Interchange District approved at the Election were $ , $ ,
and $ , respectively, and the payment obligations of the Interchange District do
not exceed any of such approved amounts. $ of such principal authorization
is allocated to the payment obligations evidenced by this Capital Pledge Agreement.
(b) Prior to the execution and delivery of this Capital Pledge Agreement the
Interchange District had no Debt outstanding.
(c) As of the date of its execution and delivery this Capital Pledge Agreement
represents the sole Debt of the Interchange District.
Section 5.07. General.
(a) This Capital Pledge Agreement and the Binding Agreement constitutes the
final, complete, and exclusive statement of the terms of the agreement between the Parties
pertaining to the subject matter of this Capital Pledge Agreement and the Binding
Agreement and supersede all prior and contemporaneous understandings or agreements of
the parties, including without limitation, the MOU. This Capital Pledge Agreement may
not be contradicted by evidence of any prior or contemporaneous statements or agreements.
No Party has been induced to enter into this Capital Pledge Agreement by, nor is any party
relying on, any representation, understanding, agreement, commitment, or warranty except
those expressly set forth in this Capital Pledge Agreement.
(b) If any term or provision of this Capital Pledge Agreement is determined to
be illegal, unenforceable, or invalid in whole or in part for any reason, such illegal,
unenforceable, or invalid provisions or part thereof shall be stricken from this Capital
Pledge Agreement, and such provision shall not affect the legality, enforceability, or
validity of the remainder of this Capital Pledge Agreement. If any provision or part thereof
of this Capital Pledge Agreement is stricken in accordance with the provisions hereof, then
such stricken provision shall be replaced, to the extent possible, with a legal, enforceable,
and valid provision that is as similar in tenor to the stricken provision as is legally possible.
(c) It is intended that there be no third-party beneficiaries of this Capital Pledge
Agreement, other than the Owners. Nothing contained herein, expressed or implied, is
intended to give to any person, other than the Owners, any claim, remedy, or right under
or pursuant hereto, and any agreement, condition, covenant, or term contained herein
required to be observed or performed by or on behalf of any Party hereto shall be for the
sole and exclusive benefit of the other Party, and the Owners .
(d) This Capital Pledge Agreement may not be assigned or transferred by any
Party without the prior written consent of the other Party. Any such assignment or transfer
without the required prior written consent shall be deemed null and void and of no effect.
(e) This Capital Pledge Agreement shall be governed by and construed under
the applicable laws of the State of Colorado. Venue for any judicial action to interpret or
enforce this Capital Pledge Agreement shall be in Larimer County District Court of the
Eighth Judicial District for the State of Colorado .
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(f) This Capital Pledge Agreement may be amended or supplemented by the
Parties, but any such amendment or supplement must be in writing and must be executed
by both Parties.
(g) If the date for making any payment or performing any action hereunder shall
be a legal holiday or a day on which banks in Denver, Colorado are authorized or required
by law to remain closed, such payment may be made or act performed on the next
succeeding day which is not a legal holiday or a day on which banks in Denver, Colorado
are authorized or required by law to remain closed.
(h) Each Party has participated fully in the review and revision of this Capital
Pledge Agreement. Any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not apply in interpreting this Capital Pledge
Agreement. The language in this Capital Pledge Agreement shall be interpreted as to its
fair meaning and not strictly for or against any Party.
(i) This Capital Pledge Agreement may be executed in several counterparts,
each of which shall be an original and all of which shall constitute but one and the same
instrument.
0 ) The Interchange District and the City shall have the right to access and
review each other' s records and accounts, at reasonable times during regular office hours,
for purposes of determining compliance with the terms of this Agreement. Such access
shall be subject to the provisions of the Colorado Open Records Act contained in Article
72 of Title 24, C .R. S . In the event of disputes or litigation between the Parties hereto, all
access and requests for such records shall be made in compliance with the Colorado Open
Records Act.
(k) The Parties each covenant that they will do, execute, acknowledge, and
deliver or cause to be done, executed, acknowledged, and delivered, such acts, instruments,
and transfers as may reasonably be required for the performance of their obligations
hereunder.
(1) This Agreement shall be binding upon and inure to the benefit of the Parties
and their respective successors and assigns .
Section 5.08. Effective Date and Termination Date. This Agreement shall become
effective on _, 2018 , and shall remain in effect until the payment in full of the Owners'
Share.
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IN WITNESS WHEREOF, the Interchange District and the City have executed this Capital
Pledge Agreement as of the day and year first above written.
INTERCHANGE DISTRICT
By:
Title :
ATTEST:
Secretary
CITY OF FORT COLLINS
By:
Mayor
ATTEST:
City Clerk
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APPENDIX A
MASTER GLOSSARY OF TERMS
"Binding Agreement" means the Binding Agreement Concerning the Development of
Interstate Highway 25 and Prospect Road Interchange by and among the City and the Owners.
"Capital Pledge Agreement" means the Capital Pledge Agreement by and between the
Interchange District and the City.
"Carryover Costs " has the meaning set forth in Section 2 . 04(d) of the Capital Pledge
Agreement.
"CDOT" means the Colorado Department of Transportation.
"Certificates of Participation " means the Certificates of Participation that are expected to
be executed and delivered to finance a portion of the costs of the Interchange Project that are not
being paid by CDOT or Timnath. If the Certificates of Participation finance more than one project,
the term "Certificates of Participation" shall mean only that pro rata portion of such Certificates
that are allocable to the financing of the Interchange Project.
"City" means the City of Fort Collins, a home rule municipality and political subdivision
of the State of Colorado .
"City Council" means the City Council of the City.
"CSURF" means the Colorado State University Research Foundation, a Colorado nonprofit
corporation.
"CSURF Parcels" means the property owned by CSURF and generally described in the
MOU.
"Development Metropolitan Districts" means, collectively, Gateway at Prospect
Metropolitan District Nos. 1 -7 ; Rudolph Farms Metropolitan District Nos . 1 -6; and SW Prospect
125 Metropolitan District Nos. 1 -7 .
"Development Mill Levy" means each of the mill levies imposed by the Development
Metropolitan Districts.
"Districts " means and includes the Interchange District and the Development Metropolitan
Districts.
"District Act" means Title 32, Article 1 , Colorado Revised Statutes, as amended.
"District Fees" means and includes the fees imposed by the Development Metropolitan
Districts pursuant to the District Act for services, programs or facilities furnished or to be furnished
by them. District Fees are not required to be pledged as security for the obligations of the
Interchange District.
l
"Election " means the election to be held by the Interchange District on May 8, 2018 .
"Eligible Operational Costs" means the actual and reasonable operating and administrative
expenses incurred by the Interchange District each year in an amount that does not exceed that
amount budgeted by the Interchange District for operating and administrative expenses in such
year, as such budget may be amended in accordance with the Capital Pledge Agreement. Revenues
generated from the Project Mill Levy may be applied by the District to the payment of Eligible
Operational Costs and the Interchange District shall receive a credit against the Owners' Share in
each year in an amount equal to the Eligible Operational Costs for such year, as further set forth
in the Capital Pledge Agreement.
"FCIC" means Fort Collins/1-25 Interchange Corner, LLC, a Colorado limited liability
Company.
"FCIC Parcel" means the property owned by FCIC and generally described in the MOU.
"Formation Costs " means the reasonable and necessary costs, fees and expenses, including
attorneys ' fees, costs and expenses, incurred by the Owners or the Interchange District in
connection with the formation of the Interchange District, including without limitation, drafting
and negotiating the service plan for the Interchange District, the preparation of the financing plan
attached to the service plan, and the costs of the Election. Formation Costs shall also include the
share of the costs of drafting and negotiating the Binding Agreement and the Capital Pledge
Agreement that are reasonably related and allocable to the formation of the Interchange District.
Formation Costs shall not include the costs incurred in connection with the formation of the
Development Districts. Revenues generated from the Project Mill Levy may be applied by the
Interchange District to the payment or reimbursement of Formation Costs in an amount not
exceeding $ as further set forth in the Capital Pledge Agreement. The Interchange
District shall not receive a credit against the Owners ' Share in an amount equal to the Formation
Costs.
"GAPA " means Gateway at Prospect Apartments, LLC, a Colorado limited liability
company.
"GAPA Parcel" means the property owned by GAPA and generally described in the MOU.
"Interchange District" means the I-25/Prospect Interchange Metropolitan District formed
pursuant to the District Act and having boundaries which include all of the Owners ' Properties.
"Interchange" means the highway interchange currently located at Interstate Highway I-
25 and Prospect Road in the City.
"Interchange District Financing Costs " means the reasonable costs of issuance incurred
in connection with the execution and delivery of the Certificates of Participation that are allocable
to the financing of the Owners ' Share with a portion of the proceeds of the Certificates of
Participation, including, without limitation, the fees and expenses of bond counsel, disclosure
counsel and counsel to the underwriter, trustee fees and expenses, rating agency fees, insurance
premiums, capitalized interest, and similar fees and expenses . If the Certificates of Participation
are executed and delivered prior to the ROW Credit being granted, the percentage of costs of
2
issuance to be allocated to the Interchange District shall be equal to $7,550,000 divided by the
total net proceeds of the Certificates of Participation to be applied to finance the Interchange
Project (in a total amount not exceeding $ 19,000,000) . If the ROW Credit has been granted prior
to the execution and delivery of the Certificates of Participation, the percentage of costs of issuance
to be allocated to the Interchange District shall be equal to $7,050,000 divided by the total net
proceeds of the Certificates to be applied to finance the Interchange Project (in a total amount not
exceeding $ 18 ,500,000). Notwithstanding the foregoing, in no event shall the Interchange District
Financing Costs exceed an amount equal to two percent (2%) of the principal amount of the
Owners ' Share as calculated at the time the Certificates of Participation are executed and delivered.
"Interchange PIF " means a PIF imposed on the Properties at a rate of 0. 75% on all future
retail sales on the Properties that are subject to the City' s sales tax under Article III in City Code
Chapter 25 .
"Interchange PIF Collection Agent " means, collectively, an entity or entities retained by
the Owners, as the declarants under the applicable Interchange PIF Covenant, with the approval of
the Interchange District, for the purpose of collecting, accounting for, and disbursing the
Interchange PIF revenue in accordance with the applicable Interchange PIF Covenant. The Owners
shall not be required to have one entity serve as Interchange PIF Collection Agent for all the
Interchange PIF Covenants.
"Interchange PIF Collection Agreement " means an agreement or agreements related to the
collection and remittance of the Interchange PIF revenue between the applicable Owner and the
Interchange PIF Collection Agent. Any of the other Owners and the Interchange District may also
be parties to the PIF Collection Agreement.
"Interchange PIF Covenant" means the recorded instrument by which an Interchange PIF
is imposed.
"MOU" the Memorandum of Understanding dated as of January 30, 2018, by and among
the City and the Owners or their authorized representatives.
"Owners" or "Property Owners " means and includes FCIC, GAPA, the TIC Owners,
Paradigm and CSURF.
"Owners ' Share" means the share of the cost of the Project to be funded by the Interchange
District in accordance with the terms and provisions of the Binding Agreement and the Capital
Pledge Agreement. The Owners' Share shall be funded solely from the Pledged Revenues.
"Paradigm" means Paradigm Properties LLC, a California limited liability company.
"Paradigm Parcels" means the two parcels of land owned by Paradigm and generally
described in the MOU.
"Parties" means, collectively, the parties to the Binding Agreement or the Capital Pledge
Agreement, as applicable .
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"Payment Schedule " means the schedule that sets forth the Owners ' Share payments due
in each year, including both a principal component and an interest component, as further set forth
in the Capital Pledge Agreement.
"PIF" means and includes any fee imposed for the provision of public improvements or
services within the whole or any portion of the Interchange District or any District by the recording
of covenants binding and running with any or all of the Properties by the Owners thereof.
"PIF Collection Agent " means the entity or agent retained to collect the Interchange PIF.
"Pledged Project Mill Levy Revenues " means the revenues derived from the Project Mill
Levy, net of (a) any reasonable costs of collection, (b) Formation Costs, (c) Eligible Operational
Costs paid by the Interchange District, and (d) any Carryover Costs .
"Pledged Revenues " means the following:
(a) Pledged Project Mill Levy Revenues ;
(b) revenues generated from the Project Fees;
(c) revenues generated from the Interchange PIF, net of any reasonable costs of
collection; and
(d) any other legally available moneys which the Interchange District
determines, in its sole discretion, to apply to the payment of the Owners '
Share.
"Project" means the project to significantly modify and improve the Interchange by
reconstructing its ramps and bridge and by reconstructing Prospect Road to a configuration with
four through lanes, a raised median, left turn lanes and pedestrian and bicycle facilities, together
with the Urban Design Features. The Project will be funded cooperatively by CDOT, the City,
Timnath and the Interchange District, pursuant to the Binding Agreement, the Capital Pledge
Agreement and the Timnath Agreement.
"Project Fees" means fees imposed by the Interchange District pursuant to the Capital
Pledge Agreement that are pledged to the payment of the Owners ' Share. The Project Fees shall
be imposed in accordance with Exhibit A attached hereto and by this reference made a part hereof.
Project Fees shall not be pledged as security for obligations of the Development Metropolitan
Districts.
"Project Mill Levy " means a general ad valorem property tax levy imposed by the
Interchange District at a rate not less than 7 . 5 mills and not more than 10 mills in accordance with
the Capital Pledge Agreement. In the event the method of calculating assessed valuation is
changed after January 1 , 2018 , such minimum or maximum mill levy, as applicable, will be
increased or decreased to reflect such changes, such increases to be determined by the Board of
the Interchange District in good faith (and such determination to be binding and final) so that to
the extent possible, the actual tax revenues generated by such mill levy, as adjusted, are neither
diminished nor enhanced as a result of such changes. For purposes of the foregoing, a change in
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the ratio of actual valuation to assessed valuation shall be deemed a change in the method of
calculating assessed valuation.
"Project ROW' means those portions of the Properties to be used as rights of way for the
Project, whether acquired by CDOT from the Property Owners by condemnation or purchase.
"Properties" means and includes the CSURF Parcels, FCIC Parcel, GAPA Parcel, TIC
Owners Parcel and the Paradigm Parcels.
"Property Owners" means and includes FCIC, GAPA, the TIC Owners, Paradigm and
CSURF.
"ROW Credit" means a credit to be applied by the City against the payment of the Owners '
Share in the amount of $500,000, subject to the conditions stated in Section 2 . 3 of the Binding
Agreement.
"Service Plan" means and includes the service plan filed pursuant to the District Act with
respect to each of the Districts.
"Service Plans" means, collectively, all of the Service Plans.
"Supplemental Act " means Part 2 of Article 57, Title 11 , C .R. S .
" TCEF' means the City Transportation Capital Expansion Fee that is imposed pursuant to
Fort Collins Code Section 7 . 5 -32.
" TCEF Credit" means a credit to be applied by the City against the payment of the Owners '
Share in an amount equal to $700,000. The TCEF Credit shall be applied at the time of execution
and delivery of the Binding Agreement.
" TABOR " means Colo . Const. Art. X. Sec . 20.
" TIC Owners" means the CW Subtrust, M. Jennet White, Christopher White, Eric. S .
White, Jane E. White, Jason R. White, Daniel A. White, New Direction IRA, Inc. FBO Barbara
Ann Medina IRA, Booren Limited Liability Partnership, Dunkin Limited Liability Limited
Partnership, Laura Snortland Fairfield, Robert C . Roth, Jr. and Robert Taylor, as tenants in
common.
"TIC Owners Parcel" means, collectively, the parcel or parcels owned by the TIC Owners
and generally described in the MOU as the LAAM Parcels.
"Timnath" means the Town of Timnath, Colorado .
" Timnath Agreement" means the agreement between the City and Timnath, providing for
Timnath' s reimbursement to the City of a portion of the costs of the Project.
" Urban Design Features" means certain design improvements in the Project required under
the City ' s development standards, that will add approximately $7 ,000,000 to the cost of the
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Project, which improvements are generally described on Exhibit B attached hereto and by this
reference made a part hereof.
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Exhibit A
Project Fees Schedule by Land Use Type
Land Use Type Fee / Acre Fee / Unit
Light Industrial ( Code 110) $2,400 N/A
50k+ GLA Commercial (Shopping Center - Code 820) $ 12,200 N/A
Convenience Store ( Code 853) $50,000 N/A
200k+ GLA Office (Code 710) $3,200 N/A
Hotel ( Code 310) N/A $310,00
Single Family Detached Residential ( Code 210) N/A $350,00
Single Family Attached ( Code 220) N/A $270.00
Multi- Family ( Code 221 ) N/A $200.00
Exhibit B
Urban Design Features
BRIDGE ENHANCEMENTS
Structural Concrete Stain on Bridge Curb, Girders MSE Walls X
Upgraded Pedestrian Rail on Bride X
Median & Pork Chop Island Cover Material Color Concrete X
Irrigation Sleeves and Pull Boxes X
GORE AREAS AND RAMPS
Earthwork/Import related to Landscape/Urban Design) X
Stone Outcrops (including design, mock ups, installation X
Boulders X
Cobble Swales X
Turf Reinforcement Mat X
Seed X
Boulders X
Irrigation Design X
Irrigation Tap, Meter & Backflow X
Irrigation Sleeves X
PROSPECT ROAD
Prospect Rd. Median - Perforated Pipe Underdrain X
Prospect Rd. Median — Membrane X
Prospect Rd. Median — Rock Filter Material X
Prospect Rd. Median - Topsoil X
Prospect Rd. Median — Double Curb X
Electrical conduit for City Street Lights X
Seed X
Turf Reinforcement Mat X
Irrigation Design X
Irrigation Tap, Meter & Backflow X
Irrigation Sleeves X
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