HomeMy WebLinkAbout2025-19 A Resolution Approving a Development Management Agreement for West Middle CreekRESOLUTION NO. 19
Series of 2025
A RESOLUTION APPROVING A DEVELOPMENT MANAGEMENT AGREEMENT FOR
THE DEVELOPMENT OF THE WEST MIDDLE CREEK VILLAGE APARTMENTS
BETWEEN THE TOWN OF VAIL, VAIL HOME PARTNERS CORPORATION AND
CORUM REAL ESTATE GROUP, INC.
WHEREAS, Town owns certain real property located at 351 North Frontage Road West,
Vail, Colorado (the “Property”); and
WHEREAS, Town with to convey the Property to Vail Home Partners Corporation
(“VHP”) in the future; and
WHEREAS, the Town and VHP wish to develop the Property as the West Middle Creek
Village Apartments, a multifamily deed restricted housing development and wish to pay
Corum Real Estate Group, Inc. to develop, manage and oversee construction of the
development pursuant to the term set forth in the Development Management Agreement,
attached hereto as Exhibit A and incorporated herein by this reference (the “DMA”).
NOW THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE
TOWN OF VAIL, COLORADO THAT:
Section 1. The Town Council hereby approves the DMA substantially the same
form as attached hereto as Exhibit A, and in a form approved by the Town Attorney, and
authorizes the Town Manager to execute the DMA on behalf of the Town.
Section 2 This Resolution shall take effect immediately upon its passage.
INTRODUCED, PASSED AND ADOPTED at a special meeting of the Town
Council of the Town of Vail held this 17th day of April, 2025.
___________________________
Travis Coggin, Mayor
ATTEST:
________________________________
Stephanie Johnson, Acting Town Clerk
DEVELOPMENT MANAGEMENT AGREEMENT
(West Middle Creek Village Apartments)
THIS DEVELOPMENT MANAGEMENT AGREEMENT (the “Agreement”) is made
this _____ day of ________________, 2025 (the “Effective Date”), by and among the
Town of Vail, a Colorado home rule municipality with an address of 75 South Frontage
Road, Vail, Colorado 81657 (the “Town”), Vail Home Partners Corporation, a Colorado
nonprofit corporation with an address of 75 South Frontage Road, Vail, Colorado 81657
(“VHPC”), and Corum Real Estate Group, Inc., a Colorado corporation with an address
of 650 South Cherry Street, Suite 1200, Denver, Colorado 80246 (“Corum”) (each
individually a “Party” and collectively the “Parties”).
WHEREAS, VHPC owns the real property located at 351 North Frontage Road
West, Vail, Colorado (the “Property”), as more particularly described in Exhibit A,
attached hereto and incorporated herein by this reference;
WHEREAS, the Parties wish to develop the Property as the West Middle Creek
Village Apartments, a multifamily deed restricted housing development (the
“Development”), and wish to pay Corum to develop, manage and oversee construction of
the Development;
WHEREAS, on December 20, 2023, the Town and Corum entered into a
Pre-Development Agreement to set forth their expectations regarding the Development
(the “Pre-DA”);
WHEREAS, VHPC is providing all financing (the “Project Financing”) necessary
for development and construction of the Development, including hard and soft costs
associated with construction of the Units, as hereinafter defined, and
WHEREAS, Corum has held itself out to the Town as having the requisite expertise
and experience to perform the development services required to complete the
Development in accordance with the terms and provisions of this Agreement.
NOW, THEREFORE, for the consideration hereinafter set forth, the receipt and
sufficiency of which are hereby acknowledged, the Parties agree as follows:
I. DEFINITIONS
For purposes of this Agreement, the following terms shall have the following
meanings:
A. “Architect” means Shears-Adkins-Rockmore Architects, LLC, a Colorado
limited liability company.
B. “Civil Engineer” means Martin/Martin Consulting Engineers.
2
Error! Unknown document property name.
C. “Construction Buyout” means the [procurement of major subcontracts by
the General Contractor for the prime subcontractors and material providers consisting of
earthwork and concrete, framing, lumber, electrical, HVAC and plumbing].
D. “Construction Contract” means the contract between VHPC and General
Contractor for construction of the Development, where the basis of payment is the Cost
of Work Plus a Fee with a Guaranteed Maximum Price with Corum’s execution of the
Construction Contract, solely as agent for VHPC.
E. “Construction Schedule” means the monthly construction schedule setting
forth the timeline for construction of the Development, including detail on monthly
anticipated construction draws, as approved by the Town.
F. “Cost Overruns” means the amount by which the total cost to complete the
Development at Completion exceeds the Development Budget (including any applicable
contingency set forth therein). For avoidance of doubt, the calculation of Cost Overruns
can only be made at such point in time as it could reasonably be concluded that the total
cost of the Development exceeds the Development Budget or at such time that any lender
for the Development has determined that the Development is Out of Balance.
G. “Covered Cost Overruns”mean any Cost Overruns other than Non-Covered
Cost Overruns.
H. “Development Budget” means that development budget prepared by Corum
and approved by the Town in writing, as more particularly described in Exhibit B,
attached hereto and incorporated herein by this reference, as amended from time to time.
I. “Development Contingency” means the following contingencies set forth in
the approved Development Budget (in order of use)
:
1. Allowances set forth in the Construction Contract;
2. $1,200,000 million of Escalation Contingency, as defined in described in
Section 5.2.7 of the Construction Contract;
3. $800,000 of Owner contingency, borne by VHPC;
4. $500,000 in General Contractor contingency set forth in the Construction
Contract;
5. $200,000 of Owner contingency, borne by VHPC; and
6. $3.0 million of Owner contingency, borne by VHPC.
J. “Development Fee” means that fee payable by the Town to Corum in
accordance with the provisions of Section VI. B.
K. “Development Savings” means the amount by which the Development
Budget (including any applicable contingency set forth therein), as amended from time to
time with respect to any changes in the scope of the Development, exceeds the total cost
to complete the Development as evidenced upon the issuance by the Town of a
3
Error! Unknown document property name.
permanent certificate of occupancy and completion by Corum of all punch list items to the
satisfaction of the Town (“Completion”)
L. Development Savings Bonus” means that fee payable by the Town to
Corum in accordance with the provisions of Section VI.C.
M. “Development Schedule” means the development schedule and milestones
attached hereto as Exhibit C. The Development Schedule shall be periodically update,
with approval of the Town, and shall detail the stages of the Development, subject to
unavoidable delays.
N. “Final Completion” means the later of: (1) the date that the Town issues a
permanent certificate of occupancy, (2) issuance of a certificate of substantial completion
by the Architect, (3) achievement of “Final Completion” under the Construction Contract;
and (4) completion of construction of the Development by Corum, including all punch list
items to the satisfaction of the Town as evidenced by the issuance by Corum of a
Certificate of Completion which is accepted by the Town in writing.
O. “Financing Closing” means the issuance by the Town of tax-exempt bonds
and loan of additional funds to VHPC in an amount sufficient to complete construction of
the Development in accordance with the Development Budget in and Development
Schedule.
P. “Force Majeure Event” means any one or more of the following events or
circumstances that, alone or in combination, directly or indirectly, materially adversely
affect the obligations of the parties under this Agreement: (a) destruction of or casualty to
or condemnation of the Property not due to any action or inaction of Corum or its
contractors; (b) governmental restriction, regulation, control or delay, including, without
limitation, any action or inaction of governmental agencies which results in an inability by
the General Contractor to work on the Development, (c) war, acts of terrorism or civil
commotion, insurrection, riots or unrest; (d) acts of God including without limitation,
earthquakes, floods, landslides, washouts, blizzards, tornadoes, hurricanes or other
natural disasters which cause a pause in construction for more than 10 days; (e)
reasonably unforeseeable strikes, lockouts, labor disputes, or embargos, or (f) epidemics,
pandemics or similar infectious disease outbreaks (including COVID-19). A Force
Majeure Event shall not include any delay resulting from the gross negligence or willful
misconduct of the party claiming excuse for performance by reason of Force Majeure
Event.
Q. “General Contractor” means Shaw Builders LLC, a Colorado limited liability
company.
R. “Guaranteed Maximum Price” means the amount of Work set forth in the
Construction Contract which shall be [$133,992,163.00], as may be adjusted pursuant to
the Construction Contract and this Agreement and accepted in writing by Corum, VHPC
and the Town.
4
Error! Unknown document property name.
S. “Non-Covered Cost Overruns” means: (i) Cost Overruns due to Unforeseen
Conditions (as defined below), (ii) any Cost Overruns that are approved by the Town in
writing as a modification of the approved Development Budget, except to the extent such
modifications in the approved Development Budget are demanded by the General
Contractor, (iii) Cost Overruns that result from a Force Majeure Event impacting the
Development, (iv) allowances as identified in the Construction Contract; (vi) any and all
“financing costs” (including interest expense), operating deficits, real property taxes and
assessments and other similar property “carry” costs accruing from and after Final
Completion; (vi) Cost Overruns directly related to a failure of VHPC to respond for a period
of more than twenty (20) days to a written request by Corum pertaining to a matter
affecting the Construction Contract, provided that after ten (10) days after such initial
written request Corum shall have provided to VHPC a second written request for such
guidance; or (vii) Cost Overruns that are not reasonably foreseeable or within the
reasonable control of Corum which could not have been reasonably inferred from the due
diligence reviewed by Corum using a customary and generally accepted standard of care
for construction projects similar to the Development.
The costs for each of the items described in the foregoing clauses (i), (ii), (iii), (iv), (v), (vi)
and (vii) shall be the responsibility of VHPC.
For purposes of (vii) above, the parties agree that the following events are reasonably
foreseeable and Cost Overruns related to the following would constitute Covered Cost
Overruns borne by Corum:
1. Failure of the Architect to perform its obligations under the architect
agreement, civil engineer to perform its obligations under the civil engineering
agreement, or failure of the General Contractor to perform its obligations under the
Construction Contract; provided that Corum is a third party beneficiary of each
such contracts for purposes of enforcement, at the cost and expense of VHPC.
2. Failure of the General Contractor to manage construction costs within the
constraints of the Construction Contract (other than with respect to Change Orders
instituted by and/or approved by VHPC in writing) after Construction Buyout,
including, without limitation, with regards to (i) increased costs arising from a lack
of supply of, or demand for, labor, other than otherwise set forth below as an event
of Force Majeure; (ii) published changes in federal, state or local law other than
otherwise set forth below as an event of Force Majeure; (iii) increased costs arising
from the adoption on the national, state or local level of more restrictive laws and
governmental regulations, including tariffs or similar governmental fees or taxes
on materials used in the Development; (iv) change orders demanded by the
General Contractor to maintain construction of the Development; (v) cost increases
arising from delays in construction outside of the Development Schedule, which
are not due to change orders instituted by VHPC or the Town; (vi) health and safety
incidents on the construction site; (vii) any penalties or fees arising from non-
compliance of law by either Corum or the General Contractor; or (viii) construction
defects arising before or within the Warranty Period which are not reimbursed by
the General Contractor, Architect, Engineer, other third party or insurance,
5
Error! Unknown document property name.
pursuant to an enforcement action undertaken by VHPC, the Town or Corum
(provided that reasonable enforcement costs incurred by Corum against the
General Contractor shall be at the cost of VHPC).
3. Any Cost Overrun described in Article VIII.C below that would permit a For
Cause Termination of this Agreement by VHPC.
Notwithstanding anything to the contrary, the maximum obligation of Corum for
Change Orders pursuant to Section I.S.2(iii) above shall be $2,875,000.
T. “Out of Balance” occurs when the remaining anticipated cost to complete
the Development exceeds the total development costs set forth in the Development
Budget.
U. “Plans and Specifications” means those plans and specifications developed
by the Architect, as approved in writing by the Town, a list of which is more particularly
described in Exhibit D, attached hereto and incorporated herein by this reference and as
may be amended with the Town's written approval from time to time.
V. “Pre-Development Fee” means that fee payable by the Town to Corum in
accordance with the provisions of Section VI. A.
W. “Substantial Completion” is the stage in the progress of the Work on the
Development is sufficiently complete in accordance with the Construction Contract and
Plans and Specifications and is fully acceptable to VHPC, the Town and the Architect,
subject only to (a) the performance of minor touchup and/or punch list items that do not
interfere with VHPC’s occupancy of the Work for its intended use; (b) the cost to complete
and/or correct remaining punch list items does not exceed $250,000 in the opinion of
VHPC; (c) VHPC has received a Certificate of Completion from Corum and a temporary
or permanent Certificate of Occupancy from the Town of Vail necessary for the Owner to
make beneficial occupancy of the Work or designated portion thereof; (d) all temporary
utilities are disconnected; and (e) Contractor is in full compliance with the payment and
lien provisions of the Construction Contract and Plans and Specifications.
X. “Termination Penalty” means an additional amount payable to Corum under
Article VIII.D(iii) for a termination of this Agreement by VHPC or the Town without cause
after the Financing Closing. The amount of the Termination Penalty shall be calculated
as follows:
1. If this Agreement is terminated by VHPC or the Town without cause after
the Financing Closing and prior to the date that the construction has achieved fifty
percent (50%) completion, the Termination Penalty shall be fifty percent (50%) of
the Retained Development Fee not otherwise payable to Corum under Article
VIII.D(i) or (ii).
6
Error! Unknown document property name.
2. If this Agreement is terminated by VHPC or the Town without cause after
the Financing Closing and on or after the date that the construction has achieved
fifty percent (50%) completion, the Termination Penalty shall be twenty percent
(20%) of the Retained Development Fee not otherwise payable to Corum under
Article VIII.D(i) or (ii).
Y. “Unforeseen Conditions” means subsurface or physical conditions that
differ from or are not indicated or described in the environmental reports or other due
diligence reports and/or materials obtained by Corum with respect to the Development,
other than those subsurface or physical conditions that would have been set forth in
applicable due diligence reports had the preparer of such reports applied a market level
standard of care and diligence common in the industry.
Z. “Warranty Period” means the period of one year from the date of Substantial
Completion.
AA. “Work” means the construction and services required by the Construction
Contract, whether completed or partially completed, and includes all other labor,
materials, equipment, and services provided or to be provided by the General Contractor
to fulfill the General Contractor Contractor’s obligations. The Work constitutes part of the
Development and shall include construction and provisions of supplies, materials, and/or
services provided by Corum, the General Contractor, subcontractors and sub-
subcontractors, material and equipment suppliers, and others required to construction the
Development in accordance with the Construction Contract.
II. PURPOSE.
The purpose of this Agreement is to set forth the Parties' respective rights and obligations
regarding the Development. The Development shall consist of approximately 268 new
dwelling units, (“Units”), including 384 beds and 231 parking spaces. The Units shall be
subject to the form of deed restriction attached hereto as Exhibit E (the “Deed
Restriction”), which shall be executed by VHCP and the Town and recorded against the
Property at the Financing Closing.
III. GENERAL PROVISIONS
A. Development Manager. The Town and VHCP hereby retain Corum to
perform pre-development and development services with respect to the day-to-day
coordination, administration, and management of the entitlement process, design,
development, construction, certain financing, financial analysis, accounting, and
marketing of the Development.
B. Standard of Performance. Corum agrees to perform the services required
to be performed of it hereunder, and such other services as the Town and/or VHCP may
reasonably request, with due diligence in a manner at least equivalent in quality and
efficiency to other experienced reputable developers performing similar services for
projects of like kind and size as the Development and, in any event, exercising its
reasonable efforts, skill, and expertise in the best interest of VHCP and the Development.
7
Error! Unknown document property name.
C. Authority. Subject to the terms and provisions of this Agreement, Corum
shall have the authority to make and implement day-to-day decisions that are necessary
in the performance of its obligations hereunder, to render directions to all third parties in
connection therewith, and to execute certain documents consistent with services
enumerated in Article IV on behalf of the Town and VHCP, in connection with the
Development. Notwithstanding anything contained herein to the contrary, in no event shall
Corum have the right or authority, express or implied, to commit or otherwise bind or
obligate the Town or VHCP to any monetary liability, unless such expenditure is
separately authorized pursuant to the Development Budget approved by the Town and
VHCP pursuant to this Agreement, is authorized to do so in writing by the Town or VHCP
or is otherwise authorized to do so by the terms and provisions of this Agreement.
IV. CORUM’S OBLIGATIONS
A. General. Corum shall complete the necessary predevelopment,
development, and construction work to enable VHPC to lease a fully entitled and fully
constructed and leased apartment building for residential occupancy subject to the Deed
Restriction.
B. Predevelopment Phase. Corum shall:
1. Advise the Town and Architect on proposed site use and improvements,
selection of materials, building systems, and equipment. Corum shall also provide
recommendations to the Town and Architect, consistent with the Development
requirements, on constructability; availability of materials and labor; time
requirements for procurement, installation and construction; prefabrication; and
factors related to construction cost including, but not limited to, costs of alternative
designs or materials, preliminary budgets, life-cycle data, value engineering and
other possible cost reductions. Corum shall consult with the Architect regarding
professional services to be provided by Corum during the construction phase. At
all times, Corum shall promptly report upon discovery or knowledge thereof any
errors, inconsistencies, non-conformance or omissions in the Plans and
Specifications.
2. Based on the preliminary design and other design criteria prepared by the
Architect, Corum shall prepare, for the Architect’s review and the Town’s approval,
preliminary estimates of the cost of the Work or the cost of program requirements
using area, volume, or similar conceptual estimating techniques. If the Architect or
Town suggests alternative materials and systems, Corum shall provide cost
evaluations of those alternative materials and systems (and which includes but is
not limited to value engineering). As the Architect progresses with the preparation of
the Plans and Specifications, Corum shall prepare and update, at appropriate intervals
agreed to by the Town and Architect, an estimate of the cost of the Work with increasing
detail and refinement. Corum shall include in the estimate those costs to allow for the
further development of the design, including cost studies on alternate systems and
materials, price escalation, and market conditions, until such time as the Town and
Corum agree on a Guaranteed Maximum Price for the Work by the General Contractor.
8
Error! Unknown document property name.
The estimate shall be provided for the Architect’s review and the Town’s approval.
Corum shall inform the Town and Architect in the event that the estimate of the Cost of
the Work exceeds the latest approved Development Budget, and make
recommendations for corrective action.
3. Prepare, for the Architect’s review and the Town’s acceptance, a schedule
of items that must be ordered in advance of construction. Corum shall expedite
and coordinate the ordering and delivery of materials that must be ordered in
advance of construction. Corum shall procure long-lead and schedule sensitive
materials such as pre-cast concrete materials and electrical equipment in a timely
manner so as to be on site to avoid delays in the completion of the Work.
4. Prepare a Guaranteed Maximum Price proposal under the Construction
Contract for the Town’s and Architect’s review, and the Town’s acceptance, which
includes a statement of the estimated cost of the Work organized by trade
categories or systems, including allowances. In preparing the Guaranteed
Maximum Price proposal, Corum shall include a contingency for Corum’s use to
cover those costs that are included in the Guaranteed Maximum Price but not
otherwise allocated to another line item or included in a change order. Corum shall
meet with the Town and Architect to review the Guaranteed Maximum Price
proposal. In the event that the Town or Architect discover any inconsistencies or
inaccuracies in the information presented, they shall promptly notify Corum, who
shall make appropriate adjustments to the Guaranteed Maximum Price proposal,
its basis, or both. Corum shall include in the Guaranteed Maximum Price all sales,
consumer, use and similar taxes for the Work provided by Corum that are legally
enacted, whether or not yet effective.
5. VHCP, shall retain the Architect and Civil Engineer to provide services, duties
and responsibilities as described in the Architect’s and Civil Engineer’s agreements,
including any additional services requested by VHPC that are necessary for the
preconstruction and construction phase services under this Agreement. Corum, as
agent for the Town and VHCP, shall assist VHCP to retain such additional consultants
and third parties to provide services, duties and responsibilities, including any
additional services determined necessary for the preconstruction and construction
phase services under this Agreement. Corum shall provide the Town with a copy of
the scope of services in any executed agreements between Corum and all such
parties, and any further modifications to the scope of services in agreements.
C. Construction Phase. Corum shall:
1. Schedule and conduct meetings with the Architect and Town to discuss
such matters as procedures, progress, coordination, and scheduling of the Work
(which may include participation by teleconference where appropriate).
2. Prepare and periodically update the a Development Schedule for the
Architect’s review and the Town’s acceptance. The Development Schedule shall
be developed with sufficient detail so as to provide for daily monitoring of the
9
Error! Unknown document property name.
progress of all major trade activities that either directly or indirectly affect the
Development Schedule. Corum shall obtain the Architect’s approval for the portion
of the Development Schedule relating to the performance of the Architect’s
services. The Development Schedule shall coordinate and integrate
preconstruction and construction activities of Corum’s services, the Architect’s
services, other Town consultants’ services, and the Town’s responsibilities; as well
as identify major milestone items that affect the Project’s timely completion. The
updated Development Schedule shall include the following: submission of the
Guaranteed Maximum Price proposal; components of the Work; times of
commencement and completion required of each Subcontractor; ordering and
delivery of products, including those that must be ordered in advance of
construction. Corum shall manage, monitor, coordinate, and expedite all activities
necessary to complete the Work within the Development Schedule. Corum
represents that the Development Schedule contains a reasonable amount of time for
the Work to be performed and Corum has included float within the Development
Schedule to accommodate foreseeable adverse weather conditions and foreseeable
delays. Corum shall manage the Construction Schedule under the Contraction
Contract and all other aspects of the Development in accordance with the
Development Schedule.
3. Prepare, develop and update, as necessary: (a) a development budget
forecast including legal, zoning, design, and consultant fees; (ii) a Development
proforma, schedule of rents and lease-up of residential units, operating expense
assumptions, and 30-year cash flow projection; and (iii) the Development Budget.
4. Work with the General Contractor to exercise commercially reasonable
efforts to achieve Construction Buyout within twelve (12) months after the date of
Financing Closing.
5. Coordinate all necessary and appropriate due diligence of the Property
prior to commencing construction of the Development.
6. Make recommendations for consideration by the Town with respect to
contracts necessary for the performance of the Work, including the Construction
Contract and Architect agreement for the Development, negotiate the terms of
such contracts, subject to the Town’s written approval and enforce the terms of
such contracts at the Town’s direction at the expense of the Town and/or VHCP.
Corum shall manage the selection of all consultants required for the Development
and enter into required consulting agreements in the name of and behalf of the
Town in accordance with the provisions of the Development Budget. Corum shall
promptly advise Town if Corum anticipates that the total cost of the Work in the
Development Budget (or any line item therein including the contingency line item)
will exceed the amount budgeted. Corum shall obtain prior consent of VHCP to
(i) any expenditures outside of the Development Budget and (ii) and reallocation
of expenditures between line items that will exceed $25,000.
10
Error! Unknown document property name.
7. Ensure that all contracts related to the Development, if the Town or VHPC
is not a direct party, contain a provision specifically noting that the Town and VHPC
are intended third party beneficiaries under the contract and shall have all rights of
the contracting party to enforce provisions under the applicable contract.
8. Coordinate and direct the work of the General Contractor, Architect, Civil
Engineer and designers, engineers, consultants, attorneys, brokerage
professionals, and any other professional service providers.
9. Assist the Architect to develop final plans, as approved in writing by the
Town.
10. Secure all necessary zoning approvals, permits, governmental approvals,
third party approvals and entitlements for the Development.
11. Cause the Work to be performed at the Development substantially in
accordance with the Development Budget and the Plans and Specifications.
12. Supervise and inspect the progress of any work at the Property and
communicate the status of work progress with the Town on a frequency of no less
than monthly.
13. Coordinate the Development so that it remains in compliance with the terms
of any applicable financing, leases, or any other agreements and contracts relating
to the Development and VHPC.
14. Attend any public hearings or community group meetings relating to the
Development.
15. Assist the Town and VHPC in obtaining financing from applicable lenders
and grant providers acceptable to the Town and upon terms and conditions
satisfactory to the Town, which shall include initial construction financing related
to the construction of the Development and any subsequent financing for the
benefit of the Development
16. Provide such information and take those actions as are reasonably required
by any lender in connection with any financing of the Development.
17. Provide construction administration services throughout construction of the
Development.
18. Cause the General Contractor to furnish the Town and VHPC a payment
and performance bond for the Development in which the Town and VHPC is each
designated as obligee (the “Bond”), in the amount of the total construction costs,
in accordance with applicable law.
19. Manage the General Contractor, attend weekly construction meetings,
monitor disbursements so that all applicable subcontractors are timely paid, and
11
Error! Unknown document property name.
coordinate applications for payment by contractors performing the Work and, if a
representative from the Town is not present at such meetings, advise the Town as
to the discussions in such meetings.
20. Administer all Applications for Payment and manage the payment of
amounts owed to any person or entity working on the Development.
21. Assist the Town, without invalidating the Construction Contract, with order
changes in the Work within the general scope of the Construction Contract consisting of
additions, deletions or other revisions. The Town shall request any such change orders
in writing. Prior to the execution of any requested change order the Development
Budget, Development Schedule and Construction Schedule shall be amended by the
Town, VHCP, Corum and to the extent required the General Contractor. Any requested
change order shall provide for an equitable adjustment in the Development Budget,
Development Schedule, and Construction Schedule as a result of changes in the Work.
Corum shall not approve any change order to the Construction Contract or Plans
and Specifications without the written consent of the Town.
D. Schedule. Corum shall manage the schedule of construction of the
Development in compliance with the Development Schedule and in accordance with
federal, state and local law and the Town’s procedural requirements. Corum shall
coordinate the issuance by the Town of necessary temporary certificates of occupancy
and thereafter final certificate of occupancy and certificate of completion, which indicates
the Town’s acceptance of the Development.
E. Costs. Subject to the terms and provisions of this Agreement, Corum shall
be responsible for causing the Development to be completed at or under the maximum
amount set forth in the Development Budget, as amended from time to time. The
Development Budget shall not be increased unless the Town agrees in writing or is
otherwise automatically increased pursuant to the terms and provisions of this
Agreement. If the actual costs of the Development exceed the Development Budget,
Corum payment of Corum’s compensation shall be governed by the terms and provisions
of Article X. If the actual costs of the Development are less than the amount of
development costs in the Development Budget, the Town shall pay only the actual costs,
together with the amount payable to Corum under Article IX. C..
F. Professional Responsibility. Corum hereby warrants that it is qualified to
assume the responsibilities and render the services described herein and has all requisite
corporate authority and professional licenses in good standing, required by law. The work
performed by Corum shall be in accordance with generally accepted professional
practices and the level of competency presently maintained by other practicing
professional firms in the same or similar type of work in the applicable community. The
work and services to be performed by or under the direction of Corum hereunder shall be
done in compliance with applicable laws, ordinances, rules and regulations. The Town's
review, approval or acceptance of, or payment for any services shall not be construed to
operate as a waiver of any rights under this Agreement or of any cause of action arising
out of the performance of this Agreement.
12
Error! Unknown document property name.
G.Books and Records. Corum shall maintain all books and records related to
the Development for inspection by the Town and/or VHCP, copies of which shall be
provided to the Town or VHPC upon request. Upon request by the Town or its agent,
Corum shall provide evidence of all costs and expenses related to the Development,
which have not been previously provided to the parties. Corum shall keep full and detailed
records and accounts related to the cost of the Work and all other costs in the Development,
and exercise such controls, as may be necessary for proper financial management under this
Agreement and to substantiate all costs incurred. The accounting and control systems shall
be satisfactory to the Town. The Town and the Town’s auditors shall, during regular business
hours and upon reasonable notice, be afforded access to, and shall be permitted to audit and
copy, Corum records and accounts, including complete documentation supporting accounting
entries, books, job cost reports, correspondence, instructions, drawings, receipts,
subcontracts, subcontractor’s proposals, subcontractor’s invoices, purchase orders,
vouchers, memoranda, and other data relating to this Agreement. Corum shall preserve these
records for a period of three years after final payment, or for such longer period as may be
required by law.
H. Authority. Except as specifically set forth in this Agreement, Corum shall
have no right, authority or power to bind the Town or any interest of the Town in the
Property for any claim for labor or for material or for any other charge or expense incurred
in delivering the Development or performing any alteration, renovation, repair,
refurbishment or other work, nor to render VHPC’s interest in the Development liable for
any lien or right of lien for any labor, materials or other charge or expense.
I. Sales Tax Exemption. Corum, with the assistance of the Town, shall
prepare all necessary documents to apply for a sales tax exemption from the State of
Colorado for all materials used in the Development, and submit such documents to the
State.
J. Property Management.Corum and VHPC acknowledge that each shall
work in good faith to develop a mutually agreeable property management agreement that
identifies Corum or its affiliate as the initial property manager for the Development.
V. VHPC'S OBLIGATIONS
A. In connection with the Development, VHPC shall:
1. Assist Corum in obtaining all approvals required so as to permit
development, construction and operation of the Development.
2. Assist Corum in identifying and/or approving engineers, architects,
contractors, brokers, and other personnel for the Development.
3. Provide timely decisions to facilitate Corum’s execution of its responsibilities
outlined above.
4. Make progress payments during the Construction Phase in accordance with
the provisions of Article VII.
13
Error! Unknown document property name.
B. Whenever the consent or approval of VHPC is required, such consent or
approval shall not be unreasonably withheld, denied or delayed.
VI. TOWN'S OBLIGATIONS
A. Fees. The Town shall waive all development application fees and building
permit fees for the Development.
B. Taxes. The Town shall waive all fees, assessments, impositions, and -
rebate all of the Town's construction materials use tax imposed on the Development.
C. Staff Project Manager. The Town hereby designates Jason Dietz, as the
dedicated staff member to coordinate the pre-development and development activities
with Corum and to facilitate efficient, timely, and responsive development application
review and entitlement processes.
VII. PAYMENTS FOR CONSTRUCTION PHASE
A. Progress Payments for Funding Construction under the Construction
Contract
1. Corum shall present to VHPC each Application for Payment from the
General Contractor prepared on forms AIA G702 and AIA G703, including all
supporting documentation submitted to the Architect and Corum, and certificates
for payment issued by the Architect, and a representation by Corum as to the
accuracy of the foregoing and compliance of such application for payment with the
terms of the Construction Contract, VHPC shall make progress payments to
Corum on account of the amount set forth such application for payment not later
than the 25th day of the following month. Notwithstanding the foregoing, the Parties
agree and acknowledge that the first Application for Payment may arise prior to
the date of the first Application for Payment presented by the General Contractor.
2. Corum shall provide to VHPC any and all invoices, related to costs and
expenses of the Development and any other evidence reasonably required by
VHPC or the Architect to demonstrate that payments already made by Corum to
the General Contractor or any other party on account of the cost of the Work equal
or exceed progress payments already received by Corum, less that portion of the
progress payments attributable to the Development Fee.
3. The schedule of values shall be prepared by or under the direction of Corum
in such form and supported by such data to substantiate its accuracy as the
Architect or VHPC may require. The schedule of values shall be used as a basis
for reviewing the Corum’s Applications for Payment. When Corum allocates costs
from a contingency to another line item in the schedule of values, Corum shall
submit supporting documentation to the Architect and VHPC.
14
Error! Unknown document property name.
4. Corum shall coordinate and cooperate with VHPC to submit any Application
for Payment to the lender of the construction loan and satisfy any requests for
information by such lender as a condition to funding such application for payment.
5. The “Application for Payment” (AIA Document G702 and G703) shall serve
as the job cost breakdown and shall be documents from which Corum shall be paid
each month. The documentation submitted with each monthly Application for
Payment by will be limited to the following: a) AIA G702 and AIA G703, b)
Unconditional Lien Waiver from General Contractor for previous month’s payment
(on a form complying with state law), waiving all liens and all claims for payment
for the work, materials and supplies covered by all previously-paid Applications for
Payment, c) Conditional Lien Waiver from General Contractor for current month’s
payment (on a form complying with state law), waiving all liens and all claims for
payment for the work, materials and supplies covered by the Application for
Payment being submitted, d) Unconditional Lien Waivers from subcontractors for
previous month’s payment (on forms complying with state law), waiving all liens
and all claims for payment for the work, materials and supplies covered by all
previously-paid Applications for Payment, d) an updated Construction Schedule
and narrative with photos including depiction of the status of construction
compared to the Construction Schedule, e) a constraint log listing critical path
items comprising pending change order requests including an estimate of cost,
construction change directives, requests for information, and submittal status log,
f) construction contingency log, g) allowance log, h) such other information,
documentation, and materials as VHPC, Town, Architect, construction lender may
reasonably require to evidence compliance with and fulfillment of the requirements
of the Construction Contract and such other information, documentation.
6. Each Application for Payment shall be based on the most recent schedule
of values submitted by the General Contractor in accordance with the Construction
Contract. The schedule of values shall allocate the entire Guaranteed Maximum
Price among: (1) the various portions of the work; (2) any contingency for costs
that are included in the Guaranteed Maximum Price but not otherwise allocated to
another line item or included in an approved change order; (3) VHCP’s contingency
log; and (4) the General Contractor’s construction fees.
7. Corum shall submit the first Application for Payment upon execution of the
Construction Contract, in which General the Contractor will be paid for costs of
insurance and any other reimbursable costs incurred prior to the Notice to
Proceeds. VHPC shall make payment of the amount certified for the first
Application for Payment not later than thirty (30) days after the issuance of the
Notice to Proceed. Material deposits shall be included in the Application for
Payment for the month when they are made (as if material stored on site) and paid
by VHPC with its payment.
8. Applications for Payment shall show the percentage of completion of each
portion of the work as of the end of the period covered by the Application for
Payment. The percentage of completion shall the percentage obtained by dividing
15
Error! Unknown document property name.
(i) the expense that has actually been incurred by the General Contractor on
account of that portion of the work and for which the General Contractor has made
payment or intends to make payment prior to the next Application for Payment, by
(ii) the share of the Guaranteed Maximum Price allocated to that portion of the
work in the schedule of values.
9. Each Application for Payment made prior to Substantial Completion (as
defined in the Construction Contract) of the work, shall reflect 5% retainage from
the payment otherwise due as set forth in Section 12.1.8 of the Construction
Contract.
B. Final Payment. Upon Substantial Completion of the Work, Corum may
submit an Application for Payment that includes the retainage withheld from prior
Applications for Payment. The Application for Payment submitted at Substantial
Completion (as defined in the Construction Contract) shall not include retainage until
Corum issues a certificate of completion which is accepted in writing by VHPC and all
punch list items have been completed.
VIII. TERM AND TERMINATION
A. This Agreement shall commence on the Effective Date and continue for
twelve months following achievement of Final Completion, unless otherwise terminated
as provided herein.
B. Corum may terminate this Agreement for cause if the Work is stopped for a
period of 30 consecutive days through no act or fault of Corum or its agents or employees,
or any other persons or entities performing portions of the Work, for any of the following
reasons:
1. Issuance of an order of a court or other public authority having jurisdiction
that requires all Work to be stopped due to an event outside of the General
Contractor’s control;
2. An act of government, such as a declaration of national emergency, that
requires all Work to be stopped; or
3. Because VHPC has not made payment with respect to any undisputed
amount on a Certificate for Payment within the time stated in the Construction
Contract.
In such case of a termination under this Section VIII.B, Corum shall be entitled to
its Paid Fee to date but no additional Development Fee.
C. VHPC or the Town may terminate this Agreement for cause if Corum (a “For
Cause Termination”):
1. Refuses or fails to assure that the General Contractor is completing the
Development in accordance with the Construction Contract and the Development
16
Error! Unknown document property name.
Schedule and applicable law with sufficient and properly skilled workers and proper
materials;
2. After receiving assurance of payment of funds from VHPC, fails to make
payment to the General Contractor or suppliers in accordance with the
Construction Contract or other respective agreements between the Contractor and
the Subcontractors or suppliers;
3. repeatedly disregards applicable laws, statutes, ordinances, codes, rules
and regulations, or lawful orders of a public authority;
4. fails to take all appropriate and reasonable steps to assure that VHPC
remains in compliance with the Construction Contract;
5. Corum is in breach of this Agreement;
6. fails to resolve differences between the Architect, General Contractor,
subcontractors or other third parties performing Work on the Development;
7. becomes insolvent, or makes a transfer in fraud of creditors or makes an
assignment for the benefit of creditors;
8. Fails to assure that Eric Komppa is actively engaged in the oversight and
development of the Development on a weekly basis;
9. Files or has filed against it a petition under any chapter or section of the
United States Bankruptcy Code or similar law or statute of the United States or any
state, or shall be adjudged bankrupt or insolvent in any legal proceeding; or a
receiver or trustee is appointed for all or a significant portion of its assets;
10. Actually, or constructively abandons the Work or the Development, or puts
VHPC on actual or constructive notice that it intends to abandon; or
11. Shall not be able to achieve Substantial Completion of the entire Work within
forty-five (45) days of the date required therefor under the Development Schedule,
as may be adjusted with the written consent of VHPC, within the reasonable belief
of or has not recovered the schedule sufficient to meet the respective time
requirements under the Development Schedule. The Architect and the VHPC shall
be deemed to have a reasonable belief that the Corum shall not be able to timely
achieve Substantial Completion of the entire Work if Corum shall fail to achieve
any schedule milestone within forty-five (45) days of the date for such milestone
as set forth in the Development Schedule.
In such case of a termination under this Section VIII.C, Corum shall be entitled to
its Paid Fee to date but no additional Development Fee, which Paid Fee shall be
reduced by or subject to repayment for all Covered Cost Overruns and all costs,
claims, liability, damages, losses, expenses and demands, including attorney fees
arising from such events permitting termination for cause hereunder.
17
Error! Unknown document property name.
D. VHPC or the Town may terminate this Agreement with or without cause
upon 30 days' prior written notice to the other Parties. If this Agreement is terminated by
the Town without cause, Corum shall be entitled to (i) retain all portions of the Paid
Development Fee previously paid and (ii) an additional portion of the Retained
Development Fee, less any Covered Cost Overruns, equal to an amount which equates
to the portion of the Paid Development Fee previously paid to Corum to the total Paid
Development Fee, and (iii) the Termination Penalty.
By way of illustration of the calculation of amounts due to Corum under this Section VIII.D
for a termination by VHPC or the Town of this Agreement without cause (after the
Financing Closing), if the total Development Fee intended to be paid under Article IX to
Corum is $7,750,000 and VHPC terminates this Agreement when the Development is
sixty (60%) complete, assuming no Covered Cost Overruns, Corum would be entitled to
(i) $2,325,000 of the Paid Development Fee (which it should have already received during
construction), (ii) $2,325,000, representing sixty percent (60%) of the Retained
Development Fee, and $310,000, representing 20% x $3,875,000 - $2,325,000, as the
Termination Penalty.
E. Neither Corum nor VHPC shall have a right to terminate this Agreement,
provided, that upon the occurrence of an Event of Default, any non-breaching party shall
have the right to terminate this Agreement upon a breach by any other party which is not
cured within thirty (30) days’ notice to the breaching party.
F. Notwithstanding anything in this Agreement to the contrary, Corum shall
have thirty (30) days, after receipt of any written notice of breach of this Agreement to
cure the breach (the “Cure Period”); provided, however, if the nature of any breach is
such that it cannot reasonably be cured within thirty (30) days, the Cure Period shall be
deemed extended for a reasonable period of time (not to exceed an additional sixty (60)
days, so long as Corum has commenced such cure, within thirty (30) days after written
notice, and proceeds in good faith and with due diligence to cause such breach to be
remedied).
IX. COMPENSATION
A. Pre-Development Services Fees. The Town shall pay Corum a pre-
development services fee in the amount of $35,000 per month, for the period ending on
the earlier of the date of (i) June 30, 2025, or (ii) the termination of this Agreement. The
Parties acknowledge that the Pre-Development Services Fee have been and shall
continue to be paid by the Town in the amount of $25,000 per month, and the balance of
$10,000 per month shall accrue and be withheld by the Town as retainage until the
Financing Closing or earlier of termination of this Agreement (collectively, the “Pre-
Development Fee”).
B.Development Fee.
1. The Town shall pay Corum a development fee (the “Development Fee”) for
development services to be provided under this Agreement in an amount equal to
18
Error! Unknown document property name.
5% of the cost of the Work as set forth in the schedule of values attached to the
Construction Contract and as shown in the approved Development Budget, less
the amount of the Pre-Development Services Fee paid or payable to Corum.
2. Subject to adjustment under Article X, the Development Fee shall be
payable, beginning on the date of Financing Closing, as follows:
50% of the total Development Fee shall be earned and payable in
equal monthly installments over the construction period as set forth
in the Construction Schedule, as may be amended (the “Paid
Development Fee”).
50% of the total Development Fee shall be earned and payable,
subject to reduction as set forth in Article X (the “Retained
Development Fee”), according to the following schedule:
(i) 10% of the Retained Development Fee shall be payable upon
issuance by the Town of a temporary certificate of occupancy for
each of the three (3) buildings in the Development, for a total of 30%
of the Development Fee;
(ii) 10% of the Retained Development Fee shall be payable upon
Final Completion; and
(iii) 10% of the Retained Development Fee shall be payable upon
termination of the Warranty Period.
Notwithstanding the foregoing and notwithstanding the provisions of
Article X, if all of the Paid Development Fee has been disbursed
throughout the construction period under the Construction Schedule,
and additional Work remains to be completed to achieve Final
Completion, Corum shall continue to be paid a monthly amount equal
to $55,555, not to exceed $1,000,000, until achievement of Final
Completion.
C. Development Savings Bonus. Corum shall be entitled to an amount not to
exceed 50% of the Development Fee of (i) all Development Savings up to the amount
that its Development Fee has otherwise been reduced by Covered Cost Overruns; and
(ii) an amount equal the 50% of all remaining Development Savings payable after (i)
above.
X. COST OVERRUNS GUARANTY
A. Corum shall be responsible for the payment of all Covered Cost Overruns,
in a maximum amount not to exceed 50% of the Development Fee, provided that such
limit shall not apply to any Cost Overruns which result in any breach by Corum of this
Agreement or any agreement related to the Development, nor shall such limit apply to
any Cost Overruns arising from the negligence or intentional misconduct of Corum (the
19
Error! Unknown document property name.
“Cost Overruns Guaranty”). The Cost Overruns Guaranty shall continue through the
Warranty Period.
B. Prior to any reduction of the Development Fee due to a Covered Cost
Overrun, the Development Contingency must be first fully extinguished. Corum shall
promptly notify the Town in writing if the Development Budget is Out of Balance.
XI. RESERVED
XII. REPRESENTATIONS, WARRANTIES AND COVENANTS.
A. Each Party
1. Each party has the legal right, full power and authority to execute and
deliver this Agreement and to perform its obligations hereunder. Except as
otherwise specifically provided herein, no party has made any representations,
warranties or agreement as to any matters concerning the Development. Each
party expressly waives any rights of rescission.
2. No party has knowledge of any petition in bankruptcy or any petition or
answer seeking an assignment for the benefit of creditors, the appointment of a
receiver, trustee, liquidation or dissolution or similar relief under the U.S.
Bankruptcy Code or any state law filed by or against or threatened to be filed by
or against it.
3. There are no actions, suits, proceedings or investigations, at law or in
equity, or before any governmental agency or other person, pending or, to each
party’s knowledge, threatened against such party which, in any case or in the
aggregate, will have a materially adverse effect on such party’s abilities to meet its
obligations in connection with this transaction.
B. Corum Representations and Warranties and Covenants.
1. Corum represents that its proposed staff possess certain relevant experience
and capabilities to deliver the Work at the stated level of performance with regard to this
project type. Corum accepts the relationship of trust and confidence established by this
Agreement and covenants with the Town and VHPC to cooperate with the Architect
and exercise Corum’s reasonable and professional skill and judgment in furthering the
interests of VHPC to furnish efficient construction administration, management
services, and supervision; and to cause the Work to be performed in an expeditious
and economical manner consistent with VHPC’s interests. Corum shall perform its
operations in an open book collaborative process during the Development. An open
book approach requires Corum to make available to VHPC, in detail, project
documentation and cost accounting transactions related to the Development, in a timely
manner in accordance with this Agreement.
2. Corum hereby warrants that it has all requisite corporate authority and
professional licenses in good standing, required by law.
20
Error! Unknown document property name.
3. Corum agrees in providing the services under this Agreement to perform its
obligations hereunder consistent with the professional skill and care ordinarily
provided by development companies providing development services and working
in the same or similar locality under the same or similar circumstances.
XIII. OWNERSHIP
A. Any and all plans, designs and related documentation and materials
provided or developed by for the Development shall be exclusively owned by VHPC. The
Parties expressly acknowledge and agrees that all such work constitutes a “work made
for hire.” To the extent, if at all, that it does not constitute a “work made for hire,” Corum
hereby transfers, sells, and assigns to VHPC all of its right, title, and interest in such work.
VHPC may, with respect to all or any portion of such work, use, publish, display,
reproduce, distribute, destroy, alter, retouch, modify, adapt, translate, or change such
work without providing notice to or receiving consent from Corum; provided that Corum
shall have no liability for any work that has been modified by VHPC.
B. In addition to the provisions of paragraph A above, upon request by the
Town, Corum shall execute an assignment of contracts to VHPC of any or all contracts
related to the Development. The parties agree that in the event that Corum fails to
execute such assignment of contracts, Corum appoints the Town as its attorney-in-fact
to execute said assignment of contracts.
XIV. INSURANCE
A. Corum agrees to procure and maintain the policies of insurance at its cost
as described on Exhibit F. The responsibility for the costs of such insurance shall be as
specified in Exhibit F.
B. The coverages afforded under the policies shall not be canceled, terminated
or materially changed without at least 30 days prior written notice to the Town. In the
case of any claims-made policy, the necessary retroactive dates and extended reporting
periods shall be procured to maintain such continuous coverage. Any insurance carried
by the Town, its officers, its employees or its contractors shall be excess and not
contributory insurance to that provided by Corum. The Town and the Town’s officers,
employees, and contractors shall be named as named insureds under all policies.
C. Corum shall provide to the Town a certificate of insurance as evidence that
the required policies are in full force and effect. The certificate shall identify this
Agreement.
D. Corum shall cause all contractors hired by or under the direction of Corum
to perform work on the Development to provide the minimum insurance coverages
required by the Construction Contract.
E. During the period from initial acquisition of the Property by VHCP, to final
certificate of occupancy, VHCP agrees to carry comprehensive public liability insurance
plus contractual liability insurance specifically covering the indemnity provision contained
21
Error! Unknown document property name.
in the following this Agreement. Corum shall be designated as an additional insured on
such insurance policies with VHCP. A certificate of each policy issued shall be delivered
promptly to Corum by Owner prior to the time when Corum commences its duties
hereunder. A copy of each policy for the foregoing insurance shall be available for
Corum’s inspection at all reasonable times upon reasonable notice to VHCP.
XV. INDEMNIFICATION
A. Corum agrees to indemnify and hold harmless the Town and VHPC and
their officers, insurers, representatives, agents, employees and assigns from and against
all claims, liability, damages, losses, expenses and demands, including attorney fees, on
account of injury, loss, or damage, including without limitation claims arising from bodily
injury, personal injury, sickness, disease, death, property loss or damage, or any other
loss of any kind whatsoever, which arise out of or are in any manner connected with this
Agreement if such injury, loss, or damage is caused in whole or in part by action or
inaction due to the omission, error, professional error, mistake, negligence, or other fault
of Corum, or any officer, employee, representative, or agent of Corum, or which arise out
of a worker’s compensation claim of any employee of Corum. Corum’s liability under this
indemnification provision shall be to the fullest extent of, but shall not exceed, that amount
represented by the degree or percentage of negligence or fault attributable to Corum, or
any officer, employee, representative, or agent of Corum.
B. VHCP agrees to indemnify and hold harmless Corum and its officers,
insurers, representatives, agents, employees and assigns from and against all claims,
liability, damages, losses, expenses and demands, including attorney fees, on account of
injury, loss, or damage, including without limitation claims arising from bodily injury,
personal injury, sickness, disease, death, property loss or damage, or any other loss of
any kind whatsoever, which arise out of or are in any manner connected with this
Agreement if such injury, loss, or damage is caused in whole or in part by action due to
the gross negligence of VHCP or the Town, or any officer, employee, representative, or
agent of VHCP or the Town. VHCP’s liability under this indemnification provision shall be
to the extent of, but shall not exceed, that amount represented by the degree or
percentage of gross negligence attributable to VHCP, or any officer, employee,
representative, or agent of VHCP.
XVI. DEFAULT AND REMEDIES
A. Corum Default. Each of the following is a Corum default of this Agreement:
1. If Corum fails to perform any of its obligations under this Agreement and
fails to remedy the same within 30 days after Corum is given a written notice
specifying the same; provided that, if the nature of the violation is such that it
cannot reasonably be remedied within 30 days, and Corum provides evidence to
the Town that the violation cannot reasonably be remedied within 30 days, then
the violation shall be remedied as soon as reasonably practicable, but in any case,
within 60 days of the original notice of violation.
22
Error! Unknown document property name.
2. If an involuntary petition is filed against Corum under a bankruptcy or
insolvency law or under the reorganization provisions of any law, or when a
receiver of Corum, or of all or substantially all of the property of Corum, is
appointed without acquiescence, and such petition or appointment is not
discharged or stayed within 90 days after the happening of such event.
3. If Corum makes an assignment of its property for the benefit of creditors or
files a voluntary petition under a bankruptcy or insolvency law, or seeks relief under
any other law for the benefit of debtors.
4. If any lender has declared the Development to be in default under any loan
which is not a result of actions by VHPC or the Town.
5. If any contractor makes a claim for payment that is not timely paid, which is
not a result of actions by VHPC or the Town, and such claim is not resolved within
30 days after the notice of such claim.
B. Town or VHPC Default. Each of the following is a Town default of this
Agreement:
1. If the Town or VHPC fails to perform any of its obligations under this
Agreement other than its obligation to pay the expenses and fees of the
Development and fails to remedy the same within 30 days after the Town or VHPC,
as applicable; provided that, if the nature of the violation is such that it cannot
reasonably be remedied within 30 days, and the Town or VHPC provides evidence
to Corum that the violation cannot reasonably be remedied within 30 days, then
the violation shall be remedied as soon as reasonably practicable, but in any case,
within 90 days of the original notice of violation.
2. If VHPC fails to pay any amount owed to Corum under this Agreement
within 30 days after the date such payment is due.
C. Remedies. Upon the occurrence of a Corum Default or a Town or VHPC
Default, the non-defaulting Party may:
1. Terminate this Agreement by delivering a written notice of termination to the
defaulting Party;
2. Upon a Corum Default, VHPC may enforce the provisions of this Agreement
by legal proceedings for the specific performance of any covenant or agreement
contained herein or for the enforcement of any other appropriate legal or equitable
remedy and recover damages caused by any breach by the defaulting party, of the
provisions of this Agreement, including court costs, and, to the extent permitted by
law, reasonable attorneys’ fees and other expenses incurred in the enforcement
of the obligations of the non-defaulting party hereunder (Corum expressly waives
any right of specific performance that may otherwise be available under this
Agreement);
23
Error! Unknown document property name.
3. If a Corum Default occurs, the Town or VHPC may, in its sole discretion and
without waiving any other rights under this Agreement or available to the Town or
VHPC, cause the assignment of the Construction Contract and all other applicable
construction documents to the Town or VHPC, cause construction of all or part of
the Development to be completed and recover appropriate damages from Corum.
If the Town proceeds to complete all or part of the Development, Corum shall, at
the request of the Party completing the Development, promptly execute an
assignment of all Plans and Specifications related to the Development to the Town.
In addition to the specific remedies set forth herein, the Town shall have all other
remedies available at law or equity, and the exercise of one remedy shall not
preclude the exercise of any other remedy Corum; or
4. Exercise any and all rights and remedies which the non-defaulting party
may have under applicable laws.
XVII. MISCELLANEOUS
A. Independent Contractor. Corum is an independent contractor.
Notwithstanding any other provision of this Agreement, all personnel assigned by or under
the direction of Corum to perform work under the terms of this Agreement shall be, and
remain at all times, employees or agents of Corum for all purposes. Corum shall make
no representation that it is a Town employee for any purposes.
B. Governing Law and Venue. This Agreement shall be governed by the laws
of the State of Colorado, and any legal action concerning the provisions hereof shall be
brought in Eagle County, Colorado.
C. No Waiver. Delays in enforcement or the waiver of any one or more defaults
or breaches of this Agreement by the Town shall not constitute a waiver of any of the
other terms or obligation of this Agreement.
D. Integration. This Agreement represents the entire agreement between the
Parties with respect to the subject matter hereof, and all prior or extrinsic agreements,
understandings or negotiations shall be deemed merged herein.
E. No Joint Venture or Partnership. No form of joint venture or partnership exists
between the Parties, and nothing contained in this Agreement shall be construed as making
the Parties joint venturers or partners.
F. Third Parties. There are no intended third-party beneficiaries to this
Agreement.
G. Notice. Any notice under this Agreement shall be in writing, and shall be
deemed sufficient when directly presented or sent pre-paid, first class U.S. mail to the
Party at the address set forth on the first page of this Agreement.
24
Error! Unknown document property name.
H.Severability. If any provision of this Agreement is found by a court of
competent jurisdiction to be unlawful or unenforceable for any reason, the remaining
provisions hereof shall remain in full force and effect.
I.Modification. This Agreement may only be modified upon written
agreement of the Parties.
J. Assignment. Neither this Agreement nor any of the rights or obligations of
the Parties shall be assigned by either Party without the written consent of the other.
K. Governmental Immunity. The Town and its officers, attorneys and
employees, are relying on, and do not waive or intend to waive by any provision of this
Agreement, the monetary limitations or any other rights, immunities or protections
provided by the Colorado Governmental Immunity Act, C.R.S. § 24-10-101, et seq., as
amended, or otherwise available to the Town and its officers, attorneys or employees.
L. Rights and Remedies. The rights and remedies of the Town under this
Agreement are in addition to any other rights and remedies provided by law. The
expiration of this Agreement shall in no way limit the Town’s legal or equitable remedies,
or the period in which such remedies may be asserted, for work negligently or defectively
performed.
M. Subject to Annual Appropriation. Pursuant to Article X, § 20 of the Colorado
Constitution, any financial obligations of the Town under this Agreement are specifically
contingent upon annual appropriation of funds sufficient to perform such obligation. This
Agreement shall never constitute a debt or obligation of the Town within any statutory or
constitutional provision.
N. Force Majeure. No Party shall be in breach of this Agreement if such Party’s
failure to perform any of the duties under this Agreement is due to Force Majeure.
O. Counterparts. The parties agree this Agreement may be executed by the
separate parties as separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall constitute one and the same
agreement/instrument. The parties agree such counterparts shall be effective
immediately and, in the future, notwithstanding anything to the contrary in applicable law,
and the parties voluntarily waive any such requirements.
P. Attorney’s Fees. In the event of any suit or action regarding this Agreement,
the parties’ performance hereunder or its interpretation or construction, the prevailing
party in such suit or action shall be awarded its reasonable attorneys’ fees and costs and
its reasonable attorneys’ fees and costs associated with any appeal. As used in this
section, “costs” include, but are not limited to, expert witness fees.
Q. Time of the Essence. Time is of the essence of this Agreement.
25
Error! Unknown document property name.
R.Non-Conversion Covenant. The General Contractor and Corum have
insured the Development as a “for-rent” apartment and the Town and VHCP are obligated
to execute the “Non-Conversion Covenant” included as an Exhibit G.
[The remainder of this page has intentionally been left blank.]
26
Error! Unknown document property name.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
Effective Date.
TOWN OF VAIL
________________________________
Russell Forrest, Town Manager
ATTEST:
_______________________________
Stephanie Johnson, Acting Town Clerk
CORUM REAL ESTATE GROUP, INC.
________________________________
Eric M. Komppa, President
STATE OF COLORADO )
) ss.
COUNTY OF _____________ )
The foregoing instrument was acknowledged before me this ____ day of
___________, 2025, by Eric M. Komppa as President of Corum Real Estate Group, Inc..
My commission expires:
_______________________________
Notary Public
VAIL HOME PARTNERS CORPORATION
By:
Its:
A-1
EXHIBIT A
LEGAL DESCRIPTION
MIDDLE CREEK SUB LOT 4 AND TRACT A OPEN SPACE OF THE SECOND
AMENDED FINAL PLAT FIDDLE CREEK SUBDIVISION, A RESUBDIVISION OF
TRACT A, TOGETHER WITH A PRCEL OF LAND LOCATED IN THE S1/2 SE1/4
SECTION 6 TOWNSHIP 5 SOUTH, RANGE 80 WEST OF THE 6TH P.M.
RECORDED 04/09/2024 UNDER RECEPTION 202403759, COUNTY OF EAGLE,
STATE OF COLORADO.
2
Error! Unknown document property name.
B-1
EXHIBIT B
DEVELOPMENT BUDGET
[SUBJECT TO REVISION UPON FINALIZATION OF CONSTRUCTION CONTRACT]
B-2
C-1
Error! Unknown document property name.
EXHIBIT C
DEVELOPMENT SCHEDULE
[SUBJECT TO REVISION UPON FINALIZATION OF CONSTRUCTION CONTRACT]
Schedule Milestones
Date: 4/02/2025
Project Name: West Middle Creek
Project Description:
Project location: 351 N Frontage Road West, Vail CO 81657
Anticipated Construction Budget: $134,000,000
Approximate project timeline:
Mobilization & NTP: 5/7/2025
Off Site Storm Line Completion: 10/31/2025
Off Site Utility Work Completion: 10/31/2025
Phase 1 full LD date: 8/17/2028
Phase 2 full LD date: 9/7/28
Phase 3 full LD date: 10/16/28
Complete turnover of units from Phase 3 full LD date and expiration of general conditions: 12/16/28
Mobilization & Notice to Proceed:
A project schedule extension will be required from April 28th to a formalized notice to proceed once financing has
been authorized to proceed, an early work authorization has been executed, and a premobilization draw has been
funded to place insurance. Currently, we have provided a schedule for a notice to proceed and mobilization that
would commence on May 12th. This will be a 14 day extension to the dates listed above but will be dependent on the
actual.
D-1
EXHIBIT D
PLANS AND SPECIFICATIONS
D-2
D-3
D-4
D-5
D-6
D-7
D-8
D-9
D-10
D-11
D-12
D-13
D-14
D-15
E-1
EXHIBIT E
FORM OF TOWN DEED RESTRICTION
F-1
EXHIBIT F
INSURANCE AND BONDING REQUIREMENTS
Corum Liability Insurance
Coverages. Corum agrees to procure and maintain, at its own cost, a policy or policies
of insurance sufficient to insure against all liability, claims, demands, and other obligations
assumed by Corum pursuant to this Agreement. At a minimum, Corum shall procure and
maintain, and shall cause any subcontractor to procure and maintain, the insurance
coverages listed below, with forms and insurers acceptable to the Town.
i.Worker's Compensation insurance as required by law.
ii. Commercial General Liability insurance with minimum combined single
limits of $1,000,000 each occurrence and $2,000,000 general aggregate. The policy shall
be applicable to all premises and operations, and shall include coverage for bodily injury,
broad form property damage, personal injury (including coverage for contractual and
employee acts), blanket contractual, products, and completed operations. The policy
shall contain a severability of interests provision, and shall include the Town and the
Town's officers, employees, and contractors as additional insureds. No additional insured
endorsement shall contain any exclusion for bodily injury or property damage arising from
completed operations.
iii, Professional liability insurance with minimum limits of $1,000,000 each
claim and $2,000,000 general aggregate.
b. Limitations. Such insurance shall be in addition to any other insurance
requirements imposed by law. The coverages afforded under the policies shall not be
canceled, terminated or materially changed without at least 30 days prior written notice to
the Town. In the case of any claims-made policy, the necessary retroactive dates and
extended reporting periods shall be procured to maintain such continuous coverage. Any
insurance carried by the Town, its officers, its employees or its contractors shall be excess
and not contributory insurance to that provided by Corum, Corum shall be solely
responsible for any deductible losses under any policy.
c. Certificate. Corum shall provide to the Town a certificate of insurance as
evidence that the required policies are in full force and effect. The certificate shall identify
this Agreement.
Performance and Payment Bonds
Corum shall assure that the General Contractor shall be required under the Construction
Contract to furnish a performance and payment bond in a form acceptable to VHPC and
the Town. Such bonds shall be made payable to VHPC as an obligee and shall be
executed by a corporate surety licensed to transact business in Colorado and acceptable
to VHPC and the Town, and shall be in an amount not less than the contract sum in the
Construction Contract. If, at any time during the construction of the Development, the
surety on such bond shall be disqualified from doing business within the Colorado, or
F-2
shall otherwise become incapable of performing its obligations under such bond, an
alternate surety acceptable to the Town shall be provided. In the event of any change
order resulting in the performance of additional work in connection with the Development,
the amounts of such bonds pertaining thereto shall be increased to include the cost of
such additional work or materials or fixtures to be incorporated in the Development as a
cost of the Development.
Professional Errors and Omissions Liability Insurance
Corum shall assure that each contract for a design consultant for the Development shall
require such obtain and maintain professional liability insurance for damages for claims
by reasons of any negligent act, error or omission committed or alleged to have been
committed by them or anyone for whom they are liable, in an amount of not less than
$2,000,000 per claim and $2,000,000 aggregate. Professional liability insurance
coverage may be structured to provide coverage on a “claims-made” basis; provided,
however, the professional liability insurance coverage shall remain in effect for the period
set out in C.R.S. §13-80-104. Deductibles for such insurance shall be paid by the design
consultants. The limits of this insurance shall not be reduced unless approved by the
Town in writing. The Town shall be listed as an additional insured on such policies.
Contractor’s Commercial General Liability Insurance
Corum shall assure that the Construction Contract shall provide be required to procure
and maintain Commercial General Liability Insurance during the duration of such
contractor’s Development Contract in the amount of at least $2,000,000 each occurrence
and $4,000,000 general aggregate (which coverage can be provided through a
combination of General Liability Insurance and Umbrella Insurance). The policies shall be
applicable to all premises and operations. Such policies shall include the Town and the
Trustee as additional named insureds and shall include a provision prohibiting
cancellation or termination without thirty (30) days prior written notice to the Town and the
Trustee. A certificate of insurance in a form acceptable to the Town shall be provided to
the Town and the Trustee with respect to each contractor. Such insurance shall provide
protection from all claims for bodily injury, including death, property damage, contractual
liability and completed operations. In addition the General Contractor shall carry a $10M
umbrella insurance policy naming the Town as an additional insured.
Design Consultant’s General Liability Insurance
Each design consultant entering into a Development Contract for the design of any portion
of the Development shall be required to procure and maintain Commercial General
Liability Insurance during the duration of such design consultant’s Development Contract
in the amount of at least $1,000,000 each occurrence, and $2,000,000 general aggregate.
The policies shall be applicable to all premises and operations. Such policies shall include
the Town and the Trustee as additional named insureds and shall include a provision
prohibiting cancellation or termination without thirty (30) days prior written notice to the
Town and the Trustee. A certificate of insurance in a form acceptable to the Town shall
be provided to the Town and Trustee with respect to each design consultant. Such
F-3
insurance shall provide protection from all claims for bodily injury, including death,
property damage, contractual liability and completed operations. The Town shall be listed
as an additional insured on such policies.
Contractor’s Automobile Liability Insurance
The General Contractor constructing the Development shall be required to procure and
maintain automobile liability insurance with minimum combined single limits for bodily
injury and property damage of not less than $1,000,000 for any one occurrence with
respect to each of the contractor’s owned, hired or non-owned vehicles assigned to or
used in performance of its work. The Town shall be listed as an additional insured on
such policies.
Builder’s Risk Insurance
Corum or contractor shall provide Builder’s Risk Insurance with minimum limits in the
amount of $30 million. A certificate of insurance shall be provided to the Trustee and the
Town within seven Business Days of the effective date of the policies. The policies shall
be written on an “all risk” basis and shall name the Town and the Trustee as insureds.
The policies shall contain a waiver of subrogation by the issuer of such policies with
respect to the Town and the Trustee, and their respective officers, agents and employees
while acting within the scope of their employment. This policy will be in place the duration
of the Work. The Town shall be listed as named insured on such policies.
Financing Insurance Requirements
Corum agrees that the foregoing insurance requirements shall be increased to the extent
required in connection with the securing the financing for the construction and operation
of the Development.
G-1
EXHIBIT G
FORM OF NON-CONVERSION COVENANT
G-2
G-3
G-4
G-5
G-6
30881265v14