HomeMy WebLinkAbout1.11 Exhibit AEXHIBIT A
t
Wnrnn T,q.P ASSTcNMENT
AND
W,q.rnn DurvBnY AcnEEMENT
THlsAGREEMENTismadeandenteredintothisdayofJune,2oo6,byandamong'
ELK spRINcs no^neow*gns essociairoN, a colorado non-irofit colpgytion ("Elk Springs
Association,), RED car.ryoN WATER cortrper.rr, a colorado corporation (the "company") and
IOHN A. ELMORE,II, and/or assigns ("Purchaser")'
Rncrr,l,Ls
A.ThenameoflosAmigosRanchHomeownersAssociationwaslegallychangedto
Etk Spring, uo*.o*rlrs Association iy riring Anicles of Amendment to the Articles of
Incorporation of the organization with the .olorado Secretary of State on October 3' 2001' Thus'
the Etk Springs Assoclation is the ,u"r"rr- in interest to the Los Amigos Ranch Homeowners
Association in all property and agreements discussed herein'
B. Pursuant to that certain Water Rights and Water Facilities Transfer Agreement (the
"Transfer Agreement") recorded in the records of Garfield CountY, Colorado' on
as Reception No.the Elk SPrings Association became the
owner of the water and water rights (the "Elk SPrings Association Water Rights"), which are
described on Exhibit A attached hereto and incorPorated herein bY this reference,and the Elk
Springs Water Facilities as defined in ParagraPh 1.a., below
herein bY this reference'
c. ln accordance with the terms and conditions of the Transfer Agteement' the Elk
Springs Association and the company entered into a water Facilities Management Agreement
(,,Management Agreernent") dated irlor.*U", 18,lggT which provides' inter alia' that the Company
shall utilize, operate, maintain, repair uJ ,"pr""" the Elk dprings water racilities and the Elk
Springs Association water fughts to provide potable water servic"e within the Los Amigos Ranch
p.U.D. The Management Agreement "*pit"ry authorizes the Company to enter into additional
water delivery agreements such as this Agreement'
D. on even date herewith Purchaser and Elk Mesa Properties' LLC' an affiliate of
Company, have entered into a Contract t" e;y ""0 Sell Real Estate titr3 "C11111ct") whereby Elk
Mesa properties, Lic rr",
"greed
to se, and purchaser has agreed to buy certain residential real
property situated wittrinttre L-os Amigo, nu"t' Planned Unit Development' commonly known as the
,.Lower Valley,, and more particularly a.'"'ru'o on Exhibit B attached hereto and incorporated
Water Tap Assignment antl l(ater Deliveti'Agreement r' F.lmore. Il. ancl/or as, '
Elk Springs Ho*"o*n*|-Association/Rri Ciryon Woter Company/John A' Elmore' Il' ancl/or assigns
Page I of 16
E.ThepartiesheretodesiretoenterintothisAgteementtlset.forththetermsand
conditions upon which eighty (g0) water trp. *iliu. sor.d.a1d issigned to purchaser, how Purchaser
will pay for the ,urn. ,nain. t.r*, una 'oiaitions
on whichwateiwill thereafter be provided to up
to eighty (80) singte lr*ii,.*rOential i*trf''g "its which may be developed within the Lower
Now,THEREFoRE,forandin'considerationofthekeepingand^performanceofthemutual
terms, covenants, and conditions contained herein, the parties agree as follows:
l.Definitions.InadditiontothetermsdefinedintheRecitals,thefollowingtermsshall
Valley
have the following meanmgs
b. "Lower ValleY"
together with all imProvements
CompanY
means the real property described on Exhibit B hereto'
which maY be constructed thereon'
a,..ElkSpringsWaterFacilities]meansallphysicalimprovementsandfacilities
reasonably necessary or desirable to withdraw, treat, pumP, stoie, transmit and deliver
potable water to the ioirrt of p"livery. rt
"
Bfrt Springs Water Facilities include' but are not
limited to, wells o, J.i*u,", ,or."" facilities, water treatment facilities, storage facilities'
pumps, pressure red;;i;", stations, ma.;o, t anrmission lines, the Master curb stop and other
iacitities upstream of the Master Curb Stop'
c...LowerValleyWaterFacilities,,meansallfacilitiesnecessarytodeliverwater
from the Point of Delivery to water rr"r, *itt'in the Lower valley which are downstream
from the Master curb Stop, including, ili; lt1ni,1,111,^,h" Master water Meter', the
PressureReductionStationandalltransmissionlines,servicelines,hydrantsandPressure
Reducing Valves.
d. .,Master Curb Stop,, means a water valve or watel shutoff device installed at
the point of Delivery and constructed as'ilrt "iiir" em Springs water Facilities' The curb
stop is owned by the Elk Springs Association and shall be miintained and operated by the
e'.,MasterWaterMeter,,meansaflowmeasurementdevicewhichshallbe
installed by p*.t rr., aownstream of the point of Delivery to specifications approved by the
Company which measures the flow of water delivered thereto'
f..MonthlyBasicAllotment,,meansl,600,000gallonsofwater.
g...PointofDelivery,,meansapointgthlwaterfacilitiesimmediately
downstream of the Master Curb Stop uJ"pUilu* of the Pressure Reduction Station and
Master water Meter. Everything upstream f f the point of Delivery shall be part of the Elk
Warcr Tap Assignment and lVater Delivery Agreement
A. Elmore. II, ancl/or as '
Elk Springs no*"o.r"rr-lrrorntnrtn"i Ciryo"'ioter Company/John A' Elmore' II' antllor assigns
Page 2 of l6
SpringsWaterFacilitiesandeverythingdownstreamofthePointofDeliveryshallbepartof
the LJwer Valley Water Facilities'
h. "Potable water" means water of sufficient purity to satisfr maximum
contaminant levels allowed ona.rtt t i'fe Drinking Water ect' pub't' g3-523'as ofthe date
of the execution of this Agreement,'*o utt applicable mandatory drinking water standards of
the State of Colorado in iffect on the date hereof'
i. "Pressure Reducing valve" means a valve device approved by the company
and installed at each residence *t i.t .t atl reduce the pressures or possible pressures on the
delivery side of the pressure-reducing valve to a pressure recorunended by the company'
j..PressureReductionStation,,meansacombinationofvalvedeviceswhich
shallbeinstalledbythePurchaserbetweentheMasterCurbStopandtheMasterWater
Meter to specifications appror"a-UV tt" -CJ**, which shall reduce the pressures on the
delivery side of the Pressure Reduction Station'
2.AssignmentandAssumption.SubjecttotheclosingoftheContract,andto
performanceofaIlffid-iti.o,,,ofthisAgreement,Colipanysha1lse11,assignand
transfer, and purchaser shall purchase, ".q,it" '"4 i:td"' 80 Water Taps for use upon the Lower
Valley, upon the terms and conditions set forth in this Agreement'
3. purchase price and payment. purchaserh^ereby promises to pay to Company the sum
of Four Hundred rhousand and No/r00,ffio","rr ($400,000.00) (the "purchase price") for the 80
WaterTapstobeassignedhereby'1o'p"pot":-'ltistylent'termssetforthbelow'itisageed
that each of said Water Taps has u rut*t?6ipoo'oo' tt'" pt"ct'use Price shall be paid as follows:
a,onorbeforeMay3l,zool,PurchasershallpaytoCompanythesumof
$135,000.00. Upon such paymlri,-bo*purv shall execute and deliver to Purchaser an
assignment"otii water r^"p. i, it* iorn, oin*hibit c attached hereto and incorporated
here-in by this reference (the "Assignment")'
b.onorbeforeMay3l,200s,PurchasershallpaytoCompanythesumof
sl35,000.00. Upon .r"t, puy,i;r;,^b;;p;ny shall execute and deliver to Purchaser an
Assignment of an additional 27 Water Taps'
c'onorbeforeMay3|,2oog,Purchasershallpaytheremainingbalanceofthe
purchase price in the amount oi$tf O,OO0.00, or such lesser fulll:::ay then be due as
theresultofanyacceleratedpaymentsmadepursuanttotheprovisionsofthefollowing
paragraph. upon such paym;; c;*prny .hull execute and deliver to Purchaser an
Assignment of the appropriate nr*u"r oiwut.t Taps paid for on such date'
Water Tap Assignment and Water Delivery Agreement
t A Elmore. II, ancl/or a:
Elk Springs yo^"o*n"rr-lrririotfoln"i Ciry-or'Woter Company/John A' Elmore' II' and/or assigns
Pagg 3 of I 6 Dv TNTFRNET FrLEsoLKl r2,wATER rAp A..TGNMENT AND wArER DELI,ERY ACREEMENT CLEAN 6'le{6 13) Doc
'. ;?;r;*-i ^-t;
tEr,NGs scM LocAL sErrtNcs TEMP.RARY INTERNET Frl
Except for the purchase price d forth in this paragraph, neither the Association nor the Company
shall have the right to charge ary additional tap fee, system development fee or other similar fee to
purchaser or his assigns aI a ondition precedent to making a Water Tap connection to the Elk
Springs Water Facilities.
Ilater Tap Assignment anel ll/ater Delivery Agreement
Elk Spriigs Homeowners Association/R"i Ciryon Water Company/John A' Elmore, Il, and/or assigns
Page 4 of 16 AscTcNMENTaNDwaTERDELTvERyAcREEMENTCLEAN6-re4or3l.Dof
CIDOCUMENTS AND SETTINGSISCM"LMAL SETTINGSITEMPORARY INTERNET FILES\OLK I I2IWATER TAP ASSIGNMENT AND WATER DELIVERY AGREEMENT CLEA}
4. No ofa T
Payment.Notwithstanding anything in this Agreement to the contrary, Purchaser agrees that he
shall not be entitled to connect any improvement constructed upon the Lower ValleY to the Elk
Springs W ater Facilities withoril first paying for a Water Tap for such improvement as required bY
this Agreement. For examPle,ifPurchaser desires to connect an improvement to the Elk SPrings
Water Facilities Prior to MaY 31,2007, he shall be required to P ay to CompanY the amount of
55,000.00 for each of such Water Taps to be connected. UPon such PaYment,Company shall deliver
an Assignment for the numberof Water Taps paid fgr. SimilarlY,ifPurchaser desires to connect a
28th or greater number of WaterTaPs after May 31, 2007 ,but before May 31,2008, Purchaser shall
pay to ComPanY the amount of $5,000.00 for each of such Water Taps in excess of 27 to be
connected during the Period between June 1, 2007 and MaY 31, 2008'Upon such PaYment,
Company shall deliver an Assignment for the number ofWater TaPs paid for. Any paYment made to
make accelerated connections as provided in this paragraPh shall not be applied to reduce the
payinents otherwise due on May 31, 2007 and May 31, 2008' but rather
the final payment due on MaY 31, 2009-
shall be applied to reduce
5. Effective Date of Assisnment. The effective date of the Assignment of any Water
Tap made pursuant t" thi. Agro**t thutt b" the date of payment and delivery of an Assignment
for such tap. prior to the effictive date of any Assignment, Company shall be responsible for the
performance of all obligations associated with such Water Taps. Upon payment for and delivery of
an Assignment for urr-y ,ru*be, of Water Taps, Purchaser shall assume and immediately be
responsible for the perflrmance of all obligations associated with all of the water for the number of
Water Taps assigned.
6. Limitations on Use of Water Taps. Purchaser hereby acknowledges and agrees that
all Water Tup, pu."hu..d h"rr*der can be utilized only to provide water service to improvements to
be constructed upon the Lower Valley, and that such Water Taps cannot be further assigned to
provide service to any other property. furtherrnore, Purchaser acknowledges and agrees that all
Water Taps assigned hereby,'*i tfr" rights to connect to the Elk Springs Water Facilities and to
receive water service from said Facilities, shall be subject in all respects to the provisions of this
Agreement.
7 . promise to purchase 80 Water Taps. This Agreement is a promise by Purchaser to
purchase unO u"qui.. utt aO Water Taps una to puy tt e sum of $400,000.00 in consideration therefor'
In the event that purchaser shall default in any of tn" terms and conditions of payment set forth in
paragraphs 2, 3 and 4 hereof, the entire unpaid balance of the Purchase Price shall become
i**"aiut"ty due and payable, said unpaid balance shall accrue interest at the rate of twelve percent
(rz%)per annum from the date of default unt, paid, and purchaser sha, become responsible for
performance of all dii;;;;;; ur*.iut.i *i.--h-*y water Taps not previousry p1il for and assigned,
together with intereu;;ry such obligation' utit't rate of twelve percent (12%)per annum from
th" dut" of default until Paid'
8 of All obligations of Purchaser Pursuant to
paragraPhs 2,3,4 and 7 of ihir Ag.""-ent shall be the personal obligations of John A' Elmore,II,
and he herebY unconditionallY Promtses to pay and perform all of the obligations ofPurchaser set
forth in such ParagraPhs , subject to Performance by ComPanY of its obligations hereunder, and
notwithstanding anY assignment of this Agreement by Purchaser.No such assi gnment of this
Agreement shall be made without the prior consent of ComPanY,which consent shall not be
withheld so long as John A. Elmore, II executes a personal guarantee of any obli gations of Purchaser
then remaining to be performed under ParagraPhs 2,3,4 and 7 of this Agreement'
g, Personal oblieation of Thomas E. Nea.l'.A11obligations to deliver Assignments of
Water Taps in u..oidun." with paragruffi'73i"a 4 oJ thit "Agreement shall be the personal
obligation of Thomas E. Neal urd h" t ",tf,V'*onditionally
promises to deliver such Assignments
of the appropriate number of Water r"pt'"p"" receipt of p'uy*""t to the Company as provided
herein.
V Prior to delivery of anY water
pursuant to this Agreement, and in additiontoPaYment for Water TaPs as set forth above, Purchaser,
at his sole expense, shall cause all of the Lower ValleY Water Facilities to be constructed to Plans
and speci fications accePtable to
commencement of construction
the ComPanY and in accordance
of any of the
with all aPP licable state and local
Lower ValleY Water
regulations , if any. Prior to the
Facilities, the Purchaser shall submi t plans and sP ecifications for such construction tothe ComPanY
for apProval No construction shall occur without the prior aPProval bY the ComPanY of such Plans
and specifications.The ComPanY shall have the ri ght to insPect the installation and construction of
all elements of the Lower ValleY Water Facilities at all stages of construction. UPon completion of
construction and prior to the delivery ofwater, the ComPanY shall have the right to have any and all
elements of the Lower ValleY Water Facilities tested to ensure that they perform to the satisfaction
of the Company. Purchaser, its succes sors and assigns, shall be fully resPonsible for all costs
associated with the oPeration,maintenance,repar and rePlacement of the Lower Vralley Water
Facilities as more ParticularlY provided in ParagraPh 15 hereinbelow
11. Delivery of Water
10
upon Purchaser's satisfaction of the obligation to pay for water Taps as set forth above and
construction of the Lower Valley Water faciliti-es, the foilowing terms shall apply:
a.TheCompanyagleestodelivertotheLowerValleyatthePointofDelivery
anamountofwatersuff,rcient."..*"tr,"reasonabledomesticandresidentialneedsofupto
llater Tap Assignment and Water Delivery Agreement t A Elmore. II, and/or a.
Elk Springs Ho*"orn"r, As;sociation/R"i Conlrr'ioter Company/John A' Elmore' II' ancl/or assigns
pasi S of t6 E,Fs\orKrr2\wATERTApAssTcNMENTAND*ATERDELTVER'ACREEMENTCLEAN6'1e46{l)'Doc
c TOd6UVEIT-S EIO SETTINGS\SCM\LOCAL SETTINGS\TEMPORARY INTERNET FILES\OLKI I2\WATER TAP ASSICNMENT N
eighty (80) single family homes, each with no more than 3,000 square feet of irrigated
landscape; prouiarO, t oirrr.r, that in no event shall the Company be obligated to deliver
water to the Lower valley: (1) For any use or to any property located outside the boundaries
of the Lower Valley, or (Z)in a monthly volume *i'i"h, as measured at the Master Water
Meter, is greater tfr* tfr. Monthly Basic Allotment' Provided' further' that until full
payment of the S+OOpbO.O0 fee set iont i, p.agraph 3: -ub9", Company shall be obligated
to provide only the amount of water """tt.*V io provide domestic water to the number of
homes for which Water Taps have been purchased and paid for as provided above'
b.TheCompanyagreestoprovidetotheLowerValleysupplementaryvolumes
of water in excess of the Monthly Basic Aflotment ("supplemental water"), provided the
following rwo conaitions are met: (1) Such Supplemental water is available to the company
under the Elk Springs Associationwater nigrrts after the lompany
fulfills-allother water
delivery obligations, including s.rpp1"me,tui water usage by members of the Elk Springs
Association, without any further .*p.rr., cost, or ootluy.by the complny.-1nd without
securing or constructing any additional water source, water rights' or water facilities; and (2)
usage of Supplemental-Waier is appropriate to serve the reasonable domestic and residential
needs of the Lower valley and will not be used or put to any use located outside the
boundaries of the Lower Valley. In the event Supplemental Water will be unavailable for
delivery to the l,o*.,. valley, the company wiil give Purchaser notice of such non-
availability no rater than the fifteenth rli.l auy orlach month for which Supplemental
waterwill be unavailable. After notifying p*.t ur.r ofthe non-availability of supplemental
water, the company shall be entitled to Jease delivery ofwater to the Lower valley after the
rrrrontrrry Basic Allotment has been delivered to the Lower valley'
c. The Elk Springs Association shall own, and the Company shall operate and
maintain, at its expense the Elk Springs Association water Rights and the Elk springs water
Facilities. Conditioned upon Pr."hur"rl. f aymenlo-f the Service Fees and Charges set forth
in this Agreement, the Elk Springs Rssociatitn and the Company shall operate and maintain
the Elk Springs Associationwater Rights and the Elk Springs water Facilities in a manner
which in the good faith belief of the iornpury will besi enable it to satisfy its obligations
under this Agreement. Except for the payments expressly required by -thjt
Agreement'
purchaser shall have no responsibility'tmh*" in itre ongoing cost of the ownership'
operations, maintenance and repair of the Elk Springs Water Rights or the Elk Springs Water
Facilities, except in the circumstances describ"d it pu.ug.aphs 16' and 17' below'
d. In the event of a shortage of water duelo lack of physical or legal water
availability such that the Company .urriot satisfy all of its Basic Allotment water service
obligations throughout the Los Amigos Ranch PUD, including the obligations to the Lower
Valley, then any r.r.rru.y curtailmint shall be administered on u pro rata reduction basis
without discrimination between residents of the Lower Valley and members of the
Association.
Ilater Tap Assignment and llater Delivery Agreement
Elk Springs Homeowners Association/Retl Canyin Water Company/John A' Elmore' II' and/or assigns
Pase 6 of l6 u,,.*^TEDTapA.STGNMENTANDwATERDELT,ER'AGREEMENTCLEAN6'lee(3)'Doc
crodtuueNr3 elo sETTlNcs'iscM\LocAL SETTINGS\TEMPoRARY INTERNET FILEs\oLK I l2\wATER rAP ASSIGNMENT N
12. Service Fees and Charges. In consideration of the Company operating and
maintaining th. nU. Sprirrgs Wrt.r Facllities and the delivery of water as provided herein, the
following terms shall aPPIY:
a. Conditioned upon payment of the sum due on May 31,2007 ,commencing on
June 1, ZO07 and,continuing each month for so long as this Agreement remains in effect,'
purchaser shall pay to the Company the sum of $266.00 per month (the "Monthly Minimum
charge,,). In exchange for paym"nt of th" Monthly Minimum charge, the Company shall
deliver up to 34,000 fattons oiwater each month to the Point of Delivery. Conditioned upon
payment of the sumiue on May 31, 2008, commencing on June l, 2008, in exchange for
payment of the Monthly Minimum Charge the Company shall deliver up to 67,000 gallons of
water each month to the point of delivery. conditioned upon payment of the sum due on
May 31, z11g,commencing on June l,2OOg, in exchange for payment of the Monthly
Minimum charge, the company shall deliver up to 100,000 gallons of water each month to
the point of delivery. The Monthly Minimum Charge shall be adjusted annually in
accordance with paragraph 6 of this Agreement'
b. In addition to the Monthly Minimum Charge Purchaser shall pay to the
Company a monthly charge in the amount of $2.66 per thousand gallons of water
(hereinafter "Monthly Allotment charge") delivered by the company to the Point of
Delivery adjusted annually in accordance with paragraph 14 of this Agreement' From June
l,z0o7 untii May 3l , 200i, the Monthly Allotment Charge shall apply to each 1,000 gallons
of water over 3+,000 gallons delivered io the point of delivery; from June 1, 2008 until May
3l,2}O9,the Monthly Allotment Charge shall apply to each 1,000 gallons of water over,
67,000 gallons delivered to the point of delivery; and from June 1, 2009 for so long as this
Agreement remains in effect the Monthly Allotment Charge shall apply to each 1,00-0
gallons of water over 100,000 gallons delivered to the point of delivery. For all time periods
under this Agreement, the Monthly Allotment Charge shall apply to each 1,000 gallons of
water deliveied during each monthabove the appropriate threshold amount up to the amount
of 1,400,000 gallons. In the event that water in excess of 1,400,000 gallons a month is ever
delivered, their Purchaser shall pay to the Company a monthly charge for all water in excess
of I ,400,000 gallons, including alisupplemental Water as defined in paragraph 1 1(b) hereof,
(hereinafter {Supplemental Water C'harge") calculated at the rate of 54.25 per thousand
gallons deliverfi to the point of Delivery, such rate also to be adjusted annually in
accordance with paragraph 14 of this Agreement'
13.Manner of PaymeE
a. On or before the tenth (tOth) day of every month during the term hereof, the
company shall bill Purchaser for the quantity of water delivered in the preceding month'
Within ten (10) days of the date said billing is issued, Purchaser shall pay, without deduction
llater Tap Assignment and Water Delivery Agreement
Elk springs Homeowners Association/Recl canyon water company/John A. Elmore, Il, and/or assigns
Page 7 of 16 aNnwarFRDELrvERyAcREEMENTcLEAN6.res(3)Doc
C I|WI]MENTS AND SETTINGS\SCM\LOCAL SETTINGSITEMPORARY INTERNET FILES\OLKI I2\WATER TAP ASSIGNMENT AND WATER DELIVERY ACREEMENT CLEAI
or setoff, the Monthly Allotment Chart or the Supplemental water Charge, if applicable to
the Company at its address provided in paragraph 24' below'
b. In the event Purchaser fails to remit the Monthly Allotment Charge or
Supplemental Water Charge, or fails to reimburse the Company pursuant to paragraph 15' 16
or 17 below, in the mannef and time period provided for herein, the Company, at its election,
may, in addition to any other remedies provided for herein or by law:
i. Assess a late charge not to exceed twenty percent (20%); and/or
ii. Recover interest at the rate of eighteen percent (18%) per annum, on
the unpaid and overdue balance; and'/or
iii. Curtail delivery of *ater under this Agreement until all amounts
owing have been paid, if a sum exceeding $500.00 remains unpaid by Purchaser'
iv.EnforcethePurchaser'spaymentobligationsbyanyandallother
lawfully available means, including suits for collection.
In any event, the company shall be entitled to recover all costs incurred in the collection of
delinquent payments, including reasonable attorneys fees, recording fees' filing fees' and
court costs.
14. Modification of Fees and Charees
a. The monthly charges set forth in paragraph 4. shall be adjusted annually by
the Company Ueginnfi lanrary-t, 2007 and on th" l" day of each January thereafter to
reflect the change in the purchasing power of the dollar. Such adjustments are based on the
consumer price InJex (,tndex',), puturn"a by the Bureau of Labor Statistics as set forth in
paragraph 14.b. below.
b. To compute the automatic annual adjustment, the Index number for the
United States as a whole in the column entitled "All Items" for the month of June' 2005' is
used as the "Base Index Number" and the corresponding Index number for the month ofJune
of each year during the term of this Agreemeniis coniidered the "Current Index Number"'
The current Index Number is compared with the Base Index Number, and the monthly
charges are adjusted in the same ratio that the current Index Numberbears to the Base Index
Number. The resulting sums establish the new charges for the following year' The new
charges so computed remain in effect from the annual date of adjustment for one year' at
which time the monthly charges are again automatically adjusted accordingto this formula:
llater Tap Assignment ancl Ll/ater Delivery Agreement
Elk Springs Homeowners Association/R"i Cinyo, Llater Company/John A' Elmore' II' and/or assigns
Page 8 of 16 TF.Ta'ASST.NMENTAND*ATERDELT'ER'A.REEMENTCLEAN6-'e{6(,).D..
cIDOCUMENTS AND SETTINGS'SCM\L(fAL SETTINGS'TEMPORARY INTERNET Fll-ESOLKl l2\wATER TAP ASSIGNMENT AI
i.IfpublicationoftheConsumerPricelndex,initsentirety,oras
necessary for the adjustment herein, .ttriiUt Oiscontinued' the parties hereto shall
thereafter accept comparable statistics or, ,r't cost of living as computed and
published by an ,g;i;f ,h" United Stut"t oi uv a responsible financial periodical
of recognizea autnffiit." ao be selected uy itre parties hereto or' if the parttes
cannot agree upon a selection, by arbitration'
ii. In the event the Index shall hereafter be converted .: " dl|Y,"1]
standard reference bu,. o, otherwise revised, the parties shall use such converston
factor,formula,o,obl.forconvertingttremae*u,*,ybepublishedbytheBureau
of Labor Statistics for said purpose, oi iuiling ,u.t puLtication, by any other
recognized pubtistrer or ri*rf* statisticJinformition selected by the parties hereto'
or, if the parties cannot agree upon a'selection' by arbitration'
w Notwithstanding
15
contrary, Purchaser shall at all times be the owner of and
anything in this Agreement to the
ater Facilities. As such,Purchaser shall, at its sole exPense, be
responsible for the Lower ValleY W
Valley Water Facilities to the same
tully responsib le to oPerate,maintatn and rePair the Lower
staridards and specifications that the ComPanY exerclses wlth resPect to the Elk SPrings Water
Facilities. All Parties acknowledge and agree that all Provisions of this Agreement related to taP
fees,service fees and charges or any other fee related provlslons are statements of the fees and
charges that will be assessed bY the Elk SPrings Association and the ComPanY for water servrce
pursuant to this Agreement.No such statements are intended to set forth or restrict the tYPes or
amounts of taP fees, system imProvement fees or other fees and charges that maY be assessed uPon
individual water users bY Purchaser or the homeowners association comPrised of owners ofProPertY
withinthe LowerValleY to reimburse or offset the costs associated withthe installation,ownershiP,
operation or maintenance of the Lower ValleY Water Facilities and anY such fees assessed bY
Purchaser shall accrue to Purchaser only. Purchaser shall be responsible for and shall indemniff the
CompanY and the Elk SPrings Associ ation for anY damage to the Lower ValleY Water Facilities or
any residence connected to the Lower Valley Water Facilitie s and from and against anY and all
claims and damages arising out of Purchaser's failure to ProPerlymaintain the LowerValleY Water
Facilities, including excessive water Pressure in the Lower ValleY Water Facilities.Notwithstanding
the foregoing, in the event that Purchaser should fail to adequatelY maintain the LowerValleY Water
Facilities, the ComPanY , and its authorized agents , emploYees, and rePresentatt ves, shall have the
right, but not the obligation,to enter the Lower V
lacing anY element of the Lower
alley at anY time for the PurPo se of insPecting,
maintaining, rePairing or rep Valley Water Facilities, including'
without limitation, the Master Water Meter or the Pressure Reduction Station. Prior to exerclsmg
any right herein granted
Facilities. The ComPanY
to maintain, repalr
shall provide Purchaser with ten (
or replace anY element of the Lower ValleY Water
l0) daYs written advance notice of the
need for rePair or rePlacement and provide Purchaser such ten (10) daY Period to effect such rePair
longer period as is reasonablY necessary to effect such work provided the
or replacement, or such
work is commenced and pursued with due diligence.IfPurchaser does not comPlete such rePair or
Water Tap Assignment antl Water Delivery Agreement
r A. Elmore. ll, and/or a:
Elk Springs no*"o.n"ir-Assictatton/R"i Cinyon'Woter Company/John A' Elmore' ll' and/or assigns
!'Wlr:{ !r!,ErrtNCS scM'LocAL sErrlNcS\TEMP.RARY INTERNET FILEs\oLK I l2\wArER rAP ASsIcNMENT N!D wArER DELIvERY AcREEMENT cLEAN 6'1e46 (3)'Doc
replacement within the designated time period, then company shall have the right' but not the
obligation, to make such repair or replacement at Purchaser's sole expenst, *g Purchaser agfees that
it shall reimburse trre cormpany ,u or the company's expenses incurred in^performing such
maintenance, repair oir.ptu.r,nent within fifteen (iS) Oays of receipt of invoiceAomthe Company
for such expense. Notwithstanding the foregoing, Company shall have no obligation to provide
advance notice to purchaser of the need for rJpuiior replacement if the defect in the Lower valley
water Facilities requires emergency and immediate attention to protect against damage to persons or
propertY.
16. Increased Treatment Standards. In the event that during the term of this Agreement'
anystatute,o,di,un"@yfederal,state,orlocalgovemmentoritsagencies
is duly enacted, promulgated, or issued which requires the Company to treat or-monitor water to be
delivered under this Agreement to an extent greater thanthe- levil and quality of treatment provided
by the Company on ii'," date of this AgreJment or which requires the Company to modify or
supplement the treatment methods or the Ek Springs water Facilities on the date ofthis Agreement'
the company agrees to use its best efforts without unreasonable delay to provide the additional or
modified treatment; provided, however, that notwithstanding anything in this-Agreement to the^
contrary, the Company shall be entitlei to charge Purchaseia proportionate share of the cost of
providing such additional or different treatment. The proportionate cost of the additional or
modified treatment borne by purchaser shall be based upon rurchaser's yearly percentage use of all
water delivered to water users through the Elk springs water Facilities and the Lower Valley water
Facilities at the time the company becomes subject to such additional or modified treatment
requirements'
17. WatsrBrghls
a. In the event that the Elk Springs Association's WaterRights shall ever, during
the term or of this Agreement, b" o. beclme-partially or wholly inadequate or insufficient'
physicallyorlegallytosupplywaterassetforthinthisAgreement,thecompanyagreesto
exercise its best efforts to secure such additional sources of water, water rights, and/or the
necessary water court approvals to permit continual delivery of apotable.water supply to the
Lower Valley as hereinprovided; provided, however, that notwithstanding anything in this
Agreementtothecontrary,theCompanyshallbeentitledtochargePurchasera
proportionate share of its additional invlstment in the manner similar to that set forth in
ParagraPh 16. above'
b. The Company shall have no liability to Purchaser or anY third party for-losses
or damages, whether direct, indirect, or consequential, that result from the failure to deliver
water to the Lower valley due to the legal or physical inadequacy or insufficiency of the Elk
Springs Association Water Rights'
Water Tap Assignment and Water Delivery Agreement
Elk Springs Homeowners Association/Recl Cinyon Water Company/John A' Elmore' II' ancl/or assigns
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C1DOCUMENTS ND SETINCS\SCM\LGAL SETTINGS'TEMPORAIY INTERNET FILES\OLXII2\WATER TAP ASSIGNMENT AN
1g. Duty of Care. The Company agrces to exercise reasonable care and good-faith efforts
to furnish potable *ut", to the Lower Valley. The Company shall not be liable for any loss or
damage, wiether direct, indirect, or consequential, for any failure to supply potable water to the
Lowei Valley or for excessive water pressures in the Lower Valley, except in those circumstances
where the Company fails to exercise reasonable care and good-faith efforts, provided, however, that
nothing herein shail modify or supersede the provisions of Paragraphs 16' and 17'
19. Title and Ownership'
a. The Company represents that it has full right and authority under the
Management Agreem.nf to iurnistr water in accordance with the terms herein. Nothing
within this Agre-ement shall be construed as granting, relinquishing, or otherwise conveying
any rights, title, or interest in the Elk Springs Water Facilities or the Elk Springs Association
Water Rights to Purchaser.
b. All water fumished under this Agreement is for the use of the owners of
property within the Lower Valley, their guests and invitees. Said right of use of water by the
Lower Valley owners shall not include any right to make a succession of uses of such water
and upo, .o'r.rpletion of the primary use by the Lower Valley owners all right, title, and
interest in and to the water furnished under this Agreement shall revert automatically and
completely to the Company. Purchaser agrees that it shall not sell or resell the water
,uppli"d to the Lower Valley. Purchaser further agrees to comply with the terms of all
applicable covenants of the Los Amigos Ranch Planned Unit Development regarding
allowable area of lawn irrigation and enforce the same. Nothing contained herein shall be
deemed as imposing on the Company any obligation orduty forthe collection orpurification
of water or otherwise after .rr" ty th" Lo*"t Valley owners or following delivery to the
Lower Valley at the Point of Delivery.
c. purchaser agrees to comply with the terms and conditions of the water court
decisions noted above for the water rights used by the Company relating to domestic water
use.
ZO. Default: Notice to Cure. In the event that any party to this Agreement shall fail to
keep or perform any covenant, term, or provision hereof required to be kept or performed by such
pu.ty u.io.ding to ih" t".-, and provisions of this Agreement, specifically including the failure to
puy ury and alifees for Water Taps or any other fees or charges due under this Agreement, the non-
a"iuutiing party shall give the aeautting party written notice specifying the particular default or
defaults. The defaultirig party shall have such time as provided in said notice, which period of time
shall in no event ue lesJtiian twenty (20) days, in which to cure such default or defaults within the
period of the notice. During the period of time provided to cure defaults, neither party shall initiate
against the other party legal proceedings for breach of this Agreement'
Water Tap Assignment and ll/ater Delivery Agreement
Elk Spriigs Homeowners Association/Reil Canyon Water Company/John A. Elmore, II, and/or assigns
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21. Termination.
a. The Company, in its sole discretion, may terminate this Agreement and the
Company's obligation under this Agreement or otherwise to supply water to the Purchaser
and the Residence upon the occurrence of any of the following:
i. Upon a determination by a court of competent jurisdiction that the
Company is a public utility for purposes of the delivery and sale of water to
Purchaser and the Residence under this Agreement or otherwise and/or is subject to
regulation by and the jurisdiction of the Colorado Public Utilities Commission.
ii. Upon a determination by a court of competent jurisdiction that the
Company or the delivery and sale of water to Purchaser and the Lower Valley under
this Agreement or otherwise is subject to rate regulation by the Garfield County
Board of County Commissioners.
iii. Upon a failure by Purchaser to cure a default pursuant to Paragraph
20. of this Agreement.
The Company's right to outstanding service charges, fees, and costs under this
Agreement and the Company's rights to impose the penalties described in Paragraph 13
above shall survive termination of this Agreement.
The failure to declare this Agreement terminated upon failure to cure a default shall
not constitute a waiver of such default or the rights provided for herein as to any other
default. Pursuit of any of the foregoing remedies shall not preclude pursuit of any of the
other remedies herein provided or any other remedies provided by law, nor shall pursuit of
any remedy herein provided constitute a forfeiture or waiver of any payment due to the
Company hereunder or of any damages accruing to the Company by reason of the violation
of any of the provisions herein contained. No waiver by the Company of any violation of
any ofthe provisions herein contained shall constitute a waiver of any other violation of any
of the provisions herein contained. The Company's acceptance ofpayments hereunder after
the occurrence of a default shall not be construed as a waiver of such default unless the
Company so notifies Purchaser in writing. Forbearance by the Company to enforce one or
more of the remedies herein provided upon a default shall not be deemed or construed to
constitute a waiver of such default. The receipt by the Company ofpayment with knowledge
of Purchaser's violation of any provision contained in this Agreement shall not constitute a
waiver of the known violation or any other violation of any of the provisions contained
herein. Purchaser shall pay all the Company's costs, expenses, and reasonable attorneys' fees
in pursuing the Company's rights or remedies hereunder or as provided by law.
Water Tap Assignment and ll/ater Delivery Agreement
Elk Springs Homeowners Association/Red Canyon Water Company/John A. Elmore, II, and/or assigns
Page l2 of l6
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purchaser, in its sole discretion, may terminate this Agreement upon the
occurrence of anY of the following:
23. Assienment
Association.
a.AssignmentbytheCompany.ThisAgreementmaynotbeassignedbythe
Company without it " prio. written consent of Purchaser except in the circ-umstances
described in paragrapt 22, uboue, whereupon it shall be assigned to the Elk Springs
b.
i. The failure by the company to deliver water to the Lower valley for
more than ten (10) .on,...,ti,e days unless such failure is caused by or a result of:
acts of God, criminal acts of third parties, enforcement of laws or regulations of
federal, state, or local governmental entities; or
ii'UponafailurebytheCompanytocureadefaultpursuantto
ParagraPh 20 of this Agreement'
c. Unless earlier terminated pursuant to this paragraph 21, this Agreement shall
terminate as provided in paragraph 22' below'
22.TermofThisAereement.UnlessSoonerterminatedpursuanttotheprovisionsof
paragraphztt,.."or@i.Rgr."."ntshalllastunti1January1,2008whichisalso
the end of the current term of the ManagemerrlAgrr.*.nt. The Association and the company agree
that if the term of the Management Agreement i-s extended, then this Agreement shall likewise be
extended upon the same tenis and conditions so that its extended term shall be coextensive with the
extended term ofthe Management Agreement. The Association and the Company agree that so long
as this Agreement has not be previously terminated under paragtaph}l hereof, upon the conclusion
of the Management Agreement, either uiit " .*poation of its current term, any renewal term' or for
any other reason, tn" 6ompany shail assign alt of its rights and obligations under this Agreement to
the Elk Springs Association, and the errl ip.ings Ass"ociation shail assume all of such rights and
obligations upon the same terms and conditions oltf,is Agreement; provided, however' that upon the
expiration of any remaining term of this Agre"ment q9 iff< Springi Association shall have the right
to modify the rates, charges, or other tenis and conditiot t upon *hich it will continue to deliver
water to the Lower valley upon twelve (12) months prior written notice to purchaser, subject
however to the limitation that the Elk Springs,q.ssociat-ion shall not have the right to increase the
rates or charges for water delivered to ttre tower valley to an amount which is more than ten percent
(10%) greater than the rates and charges for the same amount of water assessed by the Elk Springs
Association upon its own water users. In the event that purchaser is unwilling to accept the
modifications proposed by the Elk Springs Association, then purchaser shall have the right to
terminate this Agreement upon the expiration of said twelve (12) month period'
llater Tap Assignment and Water Delivery Agreement
Etk springs Homeowners Association/Red canyon water company/John A' Elmore' II' ancl/or assigns
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b. Assignment by Purchaser. Purchaser hereby agrees that it shall assign all of
its right, title, and interest in this Agreement to a homeowners association whose members
shall be the owners of the residential lots or units to be developed within the Lower Valley.
Purchaser shall make such assignment no earlier than the sale of the first such lot or unit and
no later than the sale of the 28th such lot or unit. Until such assignment, Purchaser shall be
fully responsible for the performance of all of Purchaser's obligations under this Agreement,
including, without limitation, the obligation to pay all service fees and charges. From and
after such assignment, the assignee homeowners association shall be fully responsible to
perform all of Purchaser's obligations under this Agreement, including, without limitation,
the obligation to pay all service fees and charges;provided, however, that notwithstanding
such assignment, Purchaser shall be personally responsible to pay for all Water Taps as
provided in paragraphs 2, 3,4 and 7 of this Agreement. Neither the Purchaser nor the
assignee homeowners association shall be entitled to assign any interest in this Agreement to
the owner of any individual lot or unit that may be created within the Lower Valley. Except
for the assignment described in this subparagraph, Purchaser shall have no right to assign its
interest in this Agreement without the prior written consent of the Company and the Elk
Springs Association.
24. Notices. Notice under this Agreement shall mean personal service or service by
registered or certified mail, United States mail, postage prepaid, at the following addresses:
PURCHASER John A. Elmore,II
COMPANY Red Canyon Water Company
2929 County Road 114
Glenwood Springs, CO 81601
ELK SPRINGS ASSOCIATION: Elk Springs Homeowners Association
2929 Cornty Road 114
Glenwood Springs, CO 81601
25. Specific Performanqe. It is specifically understood and agreed that the rights
acquired by each party hereto are such that the failure of the other party to perform its obligations
hereunder would do irreparable harm to the non-defaulting party and there would be no adequate
remedy at law. Accordingly, it is agreed that, in addition to any other equitable or legal remedies,
the obligations of the parties hereto shall be specifically enforceable in any court of competent
jurisdiction.
Water Tap Assignment and Water Delivery Agreement
Elk Springs Homeowners Association/Red Canyon llater Company/John A. Elmore, Il, ancl/or assigns
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26. Force Majeure. It is expressly agreed that the rights and obligations of the parties
shall be ,urp.rd.d *h* rither party is unable to perform for reasons beyond its control or as a
result of an act of God or an act of a third party'
27 . Service Intemrption. In the event the Company needs to stop orcurtail the diversion
or withdrawal of *ut.r or tfre delivery of water to the Lower Valley for maintenance or
reconstruction purposes, it shall have the right, upon reasonable advance notice to Purchaser, to
temporarily ,rrp"rrA or curtail the delivery of water to the Lower Valley for the purpose of such
maintenance or reconstruction.
Zg. Fire Flows. The water available at the point of delivery shall be sufficient to deliver
1073 gallon, pr, *i^rt. ut 20 psi which should be adequate under IFC Section B 1 05 to provide fire
flow Io singie family dwellings of less than 3,600 square feet. Except for the foregoing the
Company makes no representation o. *u.ranty conceming the adequacy of the flows available to the
poini of belivery for fiire protection purposes within the Lower valley. Notwithstanding anything in
this Agreement to the contrary, any water delivered through the Point of Delivery for actual use to
fight i fire shall not be subject to the charges set forth in this Agreement. In the event of such
"ri"rg"r"y use of water the parties shall instead work together to establish a fair and reasonable cost
of suJh *ut., in light of the circumstances and in consideration of the actual additional cost to the
company, if any, of producing and delivering such emergency supply of water.
29. Attorneys' Fees. In any dispute between the parties to this Agreement, the prevailing
party shall Ue entittea io r".ou., its costs, expenses and reasonable attorney's fees.
30. Benefit. This Agreement shall extend to, be binding upon, and inure to the benefit of
the parties hereto and their heirs, successors, and assigns; Nothing in this Agreement is intended to
.orrfrr on any third person or entity any benefits, rights, or remedies.
31. lnteerated Agreement. This Agreement supersedes and controls all prior written and
oral agreem.rt. ,ni r"pr.riltuti,oo, of the parties and is the total integrated agreement among the
parties with respect to ihe subject matter hereof. To the extent there may be any inconsistency or
conflict between the provisions of this Agreement, the Transfer Agreement and the Management
Agreement, the provisions of this Agreement shall control as to such conflicts or inconsistencies.
32. Authoritlr to Execute. By signing this Agreement, the parties acknowledge and
represent to one urrott ".
tt ut utt procedures necessary to validly contract and execute this Agfeement
have been performed and that the persons signing for each party have been duly authorized to do so'
Water Tap Assignment and Water Delivery Agreement
Elk Springs Homeowners Association/Retl Cinyon Water Company/John A' Elmore' ll' and/or assigns
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IN WITNESS WHEREOF, the parties have executed this Water Delivery Agreement in
triplicate originals on the day and year first above written.
ELK SPRINGS HOMEOWNERS ASSOCIATION,
a Colorado non-profit corporation
By:
Name:
Its:
RED CANYON WATER COMPANY
President, RCWC
ATTEST:
Secretary, RCWC
PURCHASER:
Water Tap Assignment and Water Delivery Agreement
Elk Springs Homeowners Association/Red Canyon Water Company/John A. Elmore, ll, and/or assigns
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a