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LandCo/City of Colorado Springs Settlement Agreement

LandCo/City of Colorado Springs Settlement Agreement. Summary of Key Elements July 31, 2009. Settlement Agreement – Background. Chronology 3/31/08 – LandCo, City, USOC enter into an Economic Development Agreement Regarding USOC Facilities

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LandCo/City of Colorado Springs Settlement Agreement

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  1. LandCo/City of Colorado Springs Settlement Agreement Summary of Key Elements July 31, 2009

  2. Settlement Agreement – Background Chronology • 3/31/08 – LandCo, City, USOC enter into an Economic Development Agreement Regarding USOC Facilities • 5/6/08 – LandCo and C.S. Public Facilities Authority (PFA) enter into a Purchase and Sale Agreement for USOC HQ condominium • 11/14/08 – Deadline for issuance of COPS and PFA purchase of USOC HQ condominium in the EDA • 3/27/09 – LandCo files suit in United States district Court, entitled LandCo Equity Partners, LLC, et al. v. The City of Colorado Springs, Colorado, USOC et al. • 4/30/09 – USOC issues notice of termination of 3/08 Economic Development Agreement and the 5/08 Purchase & Sale Agreement • 5/21/09 – City issues notice of termination of the agreements • 4/1/09 – 7/30/09 – All parties dedicate maximum effort towards settling the lawsuit

  3. Settlement Agreement – Key Business Elements Conditions Precedent The following to be prepared, agreed and ready for execution by July 24, 2009: • Revised condominium documents • A new Purchase and Sale Agreement between the PFA and LandCo (purchase price of $18,800,000 for core and shell) • A loan commitment from United Western Bank verifying financing to complete the core and shell • An agreement between G.E. Johnson Construction Company and LandCo certifying that no liens resulting from any disputes between them will be placed on the USOC condominium

  4. Settlement Agreement – Key Business Elements City Council Approval of Agreement City Council is expected to formally consider the Agreement on or before August 11, 2009 after at least a 7 day period for public review of the Settlement Agreement and all associated legal documents

  5. Settlement Agreement – Key Business Elements NGB Building Renovation Project • Within 5 days of execution of Settlement Agreement, LandCo shall transfer all funds in the NGB Escrow Account to the City in the sum of at least $746,708, plus accrued interest. • On same date, LandCo affiliate to transfer to the City the construction contract with The Copestone Company for renovating the NGB Building. • Upon transfer of funds and contract, LandCo to have no further responsibility for completing the renovation of the NGB Building.

  6. Settlement Agreement – Key Business Elements Issuance of COPS • PFA to purchase USOC condominium unit with funds generated from the issuance of certificates of participation (COPs) • COP issuance process to begin immediately after execution of Settlement Agreement • COPS to be issued within 45 days • However, PFA’s obligation to purchase USOC Condominium is contingent upon the successful issuance of the COPs and a signed sublease with the USOC • Upon issuance of COPs, $18.8 million of the total to be placed in an escrow account for purchase of USOC Condominium

  7. Settlement Agreement – Key Business Elements Sale and Purchase of USOC Condominium • LandCo to complete core and shell of the condo unit on or before 9/30/09. Failure to complete by that date to result in $1,500 daily reduction in purchase price paid by PFA. Failure to complete unit by 10/15/09 is a material breach of the Agreement and the PFA no longer obligated to purchase the USOC condominium. • Purchase price to be $18.8 million. • LandCo to pay all taxes due and owing through the closing date. • Condo unit to be transferred free and clear of all liens and encumbrances and title insurance to be purchased by LandCo.

  8. Settlement Agreement – Key Business Elements Sale and Purchase of USOC Condominium (cont.) • City to be responsible for completion of the tenant finish of the USOC Headquarters Condominium by March 30, 2010 • City to be responsible for completion of streetscape adjacent to USOC Headquarters Building (to be paid by City Parking Enterprise as originally planned) • LandCo to release its rights to 240 spaces in City Parking Garage once PFA purchases USOC Condominium • LandCo to have no responsibility for construction of skybridge

  9. Settlement Agreement – Key Legal Elements Dismissal of Claims • Dismissal of federal lawsuit, without prejudice, upon execution of Settlement Agreement. • Dismissal with prejudice once the COPs have been issued and USOC condominium unit is purchased

  10. Questions

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