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HomeMy WebLinkAbout22-135 Water Activity Enterprise Second Amnd. Native Water Dedication Agrmt. CK H20 Ventures, Millrace Resources & Frontier Ventures 12-14-2022RESOLUTION NO.22-135 A RESOLUTION OF THE BOARD OF TRUSTEES OF THE TOWN OF FIRESTONE, COLORADO, ACTING BY AND THROUGH ITS WATER ACTIVITY ENTERPRISE, APPROVING THE SECOND AMENDMENT TO THE NATIVE WATER DEDICATION AGREEMENT AND ADDENDUM BETWEEN THE TOWN OF FIRESTONE AND CK H2O VENTURES LLC A COLORADO LIMITED LIABILITY COMPANY, MILLRACE RESOURCES LLC A COLORADO LIMITED LIABILITY COMPANY AND FRONTIER VENTURES LLC, A COLORADO LIMITED LIABILITY COMPANY WHEREAS, upon adoption of Resolution No. 2246 the Town of Firestone ("Town") approved a Native Water Dedication Agreement and Addendum (collectively "Dedication Agreement") with CK H2O Ventures LLC Millrace Resources LLC and Frontier Ventures LLC (collectively "Developer") which allows Developer to dedicate Native Water in the form of shares in the New Coal Ridge Ditch Company to the Town in satisfaction of Developer's raw water dedication requirements set forth in the Firestone Municipal Code; and WHEREAS, the Dedication Agreement establishes deadlines for certain actions to be taken in the process of dedicating the Native Water to the Town; and WHEREAS, the Developer requested additional time to complete the obligations for its performance of the October 2022 Credit Closing as the term is defined in the Dedication Agreement; and WHEREAS, the Town upon adoption of Resolution No. 22-116 approved the First Amendment to the Dedication Agreement which extended the Credit Closing deadline to December 15, 2022;and WHEREAS, the parties now desire to further amend the Dedication Agreement by extending the Credit Closing deadline to January 15, 2023, provide that the Dedication Fee will be due no later than May 15, 2023 and assign the Dedication Agreement to Vidler Water Company a DR Horton Company. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF TRUSTEES OF THE TOWN OF FIRESTONE, COLORADO: The Second Amendment to the Native Water Dedication Agreement and Addendum between the Town of Firestone, acting by and through its Water Activity Enterprise, and CKO H2O Ventures LLC, a Colorado limited liability company, Millrace Resources LLC, a Colorado limited liability company, and Frontier Ventures LLC, a Colorado limited liability company, is approved in substantially the same form as the copy attached hereto and made a part of this resolution, and the Mayor is authorized to execute the Second Amendment to the Native Water Dedication Agreement and Addendum on behalf of the Town of Firestone. INTRODUCED, READ, AND ADOPTED this 14th day of December, 2022. TO OF FIRES ONE, COLORADO Drew Alan Peterson, Mayor A ST: \�tbNF ouzales, Acting Town Clerk N p to APPROVED AST ORM:!O �v �UNTy Will *Mr. wiftsTiwr Attorney SECOND AMENDMENT TO NATIVE WATER DEDICATION AGREEMENT THIS SECOND AMENDMENT TO NATIVE WATER DEDICATION AGREEMENT ("Second Amendment') is entered into on this 14th day of December 2022, by and between Firestone and CK H2O Ventures, LLC, a Colorado limited liability company, Millrace Resources, LLC, A Colorado limited liability company, LR Investments, LLC, a Colorado limited liability company, and Frontier Ventures, LLC, a Colorado limited liability company whose address is c/o Carlson Land Development, LLC, 14570 Clay Street, Broomfield, Colorado 80023; Attention: Blake Carlson (collectively "Developer"). Firestone and Developer may be referred to collectively herein as the "Parties". In this regard, the Parties hereby agree as follows: WITNESSETH WHEREAS, Firestone and Developer entered into a Native Water Dedication Agreement ("NW➢A") dated March 30, 2022 as modified by the Addendum to Native Water Dedication Agreement ("Addendum") which allows Developer to dedicate Native Water in the form of shares in the New Coal Ridge Ditch Company (the "Native Water") to Firestone in satisfaction of Developer's raw water dedication requirements to the Firestone Municipal Code; and WHEREAS, the Parties executed an Amendment to the NWDA ("First Amendment") which extended certain deadlines for certain actions to be taken in the process of dedicating the Native Water to Firestone, including extending the date of the Credit Closing to December 15, 2022; and WHEREAS, the Parties and LR Investments, LLC wish to add LR Investments, LLC as a party to the NWDA as a part of the group collectively referenced in the NWDA as the "Developer;" and WHEREAS, Developer has requested additional time to complete the obligations necessary for its performance under the NWDA at the Credit Closing, as that date was extended under the First Amendment; and. WHEREAS, the Parties wish to further amend those deadlines as stated in this Second Amendment to allow for Developer to complete the dedication of the Native Water to Firestone; and WHEREAS, the Parties wish to acknowledge Developer's intent to assign the NWDA to Vidler Water Company, Inc., a Nevada corporation, pursuant to the terms of the NWDA and this Second Amendment and, following that assignment, Vidler Water Company, Inc., will be the "Developer" in this Agreement; and WHEREAS, the Parties wish to make further additional amendments to the NWDA as described in this Second Amendment. NOW, THEREFORE, for and in consideration of the mutual promises set forth, and other good and valuable consideration, which is hereby acknowledged and reccipted for, Firestone and Developer agree as follows: 1. The recitals above are hereby incorporated as if fully restated herein. 2. Lk Investments, LLC, as the owner of the 46 shares in the New Coal Ridge Ditch Company represented by Certificate No. 271 ("LR Shares"), is hereby made a party to the NWDA and assumes all interests and obligations of "Developer" under the NWDA, collectively with the other parties referred to as "Developer" in the NWDA, including dedication of the LR Shares to Firestone as contemplated by the NWDA, slid this Second Amendment. 3. Amended Credit Closing. The Credit Closing is extended to January 15, 2023 or if Developer has not received a waiver of the New Coal Ridge Ditch Company's right of first refusal for conveyance of the shares to Firestone by January 15, the date which is five (5) days after receipt of such wavier. All of Developer's obligations as anticipated under the NWDA to be performed at the Credit Closing, including conveyance of the Native Water as described in ¶3 of the NWDA, remain effective unless expressly modified in this Second Amendment. At least 14 days prior to the Credit Closing, Developer shall deliver to Firestone all documents evidencing title to the Native Water is vested in Developer. 4. Amended Storage and Infrastructure Fee. Developer's obligation to pay the Storage and Infrastructure Fee is hereby modified as follows: a. In order to achieve the purpose of making the Native Water available for potable water use, Developer has agreed to pay a Storage and infrastructure Fee of $8,000,000.00 to Firestone ("Revised Storage and htfrastructure Fee") in lieu of the calculation of the Storage and Infrastructure Fee described in the Paragraph 2.3. of the NWDA. b. The Revised Storage and Infrastructure Fee will be due and payable by Developer no later than May 15, 2023. The Town of Firestone will not recognize the completion of dedication of the Native Water for the purposes creating Native Credit under the NWDA and satisfying Developer's Dedication Requirement unless and until the Revised Storage and Infrastructure Fee is paid by Developer. 5. Native Water Credit. Subject to final review of title by Firestone, the Parties agree that Developer may be entitled to receive up to 450 acre-feet of Native Water Credit pursuant to the NWDA, provided that Developer comply with the following terms: At the Credit Closing, Developer shall pay a non-refundable fee of $10,000.00 as a curative action to defects of title to the Native Water. In the event that this $10,000.00 is not paid by the Developer, Firestone will deduct 22 acre-feet from the Native Credit Developer receives from the conveyance of the Native Water. Firestone shall not have any rights or remedies, concerning such defects of title other than what is stated in this paragraph 5(a). b. If Developer fails to pay the Storage and Infrastructure Fee, as described in 14 of this Second Amendment on or before May 15, 2023, Firestone will deduct 37.2 acre-feet from the Native Credit that Developer receives from the dedication of the Native Water under the NWDA. The determination of Native Credit as described herein supersedes and replaces any prior determination that has been made by the Town to Developer and is contingent on Developer's conveyance of title as described in the NWDA. 6. Warrantyof Title To Native Water. Consistent with 13 of the NWDA, the Native Water will be conveyed to Firestone by Special Warranty Deed. The Parties acknowledge and agree that the Developer's warranty is subject to any potential clouds on title regarding ownership of the Native Water to be dedicated to Firestone under the Dedication Agreement. These potential clouds on title were described previously in the Addendum. This paragraph amends and supersedes ¶4 of the NWDA. 7. Binding Effect and Transferability. This Agreement shall be binding upon and inure to the benefit of Firestone as well as Developer, its heirs, personal representatives, successors, transferees and assigns. Developer may assign the Native Credit to another party in connection with the transfer of Developer's Lands. Firestone will provide Developer with a form Native Credit Transfer at the Credit Closing to be used in connection with the transfer of any Native Credit by Developer. Any Native Credit dedicated by Developer shall be used solely on Developer's Lands for the Dedication Requirement unless, at Developer's request, Firestone approves use of the Native Credits on other lands in Firestone, which approval shall not be unreasonably withheld. If Firestone approves any Native Credit for use on such other lands in Firestone, Firestone shall apply any unused Revised Storage and Infrastructure Fee to development of those lands. This paragraph amends and supersedes ¶15 of the NWDA. 8. Assignment of NWDA. The Parties agree that Developer may assign the NWDA and all Developer's interests and obligations thereunder to the Vidler Water Company. Vidler Water Company, Inc., as assignee, shall be bound by and shall perform all obligations of the Developer pursuant to the NWDA, the Addendum, the First Amendment and this Second Amendment. 9. Except as modified by this Amendment, the terms of the Agreement remain infull force and effect. 10. In the event of any inconsistencies between the terms and provisions of this Second Amendment and those set forth in the NWDA, the terms and conditions of this Second Amendment shall controlin all instances. Capitalized terns not otherwise defined in this Amendment shall have the meaning attributed to those terms in the NWDA. Except as set forth in this Second Amendment, the NWDA is ratified and acknowledged by the parties to be in full force and effect. This Second Amendment may be executed in two or more counterparts, each of which shall be deemed an original, all of which together shall constitute one and the same instrument. Executed copies of this Amendment may be delivered by email or facsimile and the parties hereto agree to accept and be bound by electronic or facsimile signatures hereto. TOWN 06 FI$ESTONE Ely_ /u/i// Naate r Title_1,c(n'Ir_ CK HZO VENTURES, LLC: By: WafraV KtMlapper. MemberManager MILLRACE RESOURCES, LLC, a Colorado limited liability company B Walaven Ketellapper, Member/Manager FRONTIER VENTURES, LLC, a Colorado limited liability company gY� B ake CarI501L Manager LR INVESTMENTS, LLC, a Colorado limited liability company lake Carlson. Manager Vidler Water Co pany, lee a Nevada Corporation By: ,t-/ i a: ,,4.