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HomeMy WebLinkAboutCore Site Employee Housing Agreement (executed not recorded copy)VAIL RESORTS Just Another Day In Paradise" . lR 0. tee. 4 December 19, 2007 Mr. Matt Mire Town Attorney Town of Vail 75 South Frontage Road Vail, CO 81657 Re: Core SiteEmployee Housing Agreement Dear Matt: O RIGI�V 44 Enclosed please find two originals of the Core Site Employee Housing Agreement executed by Keith Fernandez on behalf of The Vail Corporation, d/b /a Vail Associates, Inc. Please arrange to obtain signatures on that document for the Town of Vail and the Vail Reinvestment Authority and return one original to me. Also enclosed please find a copy of the letter of credit, the original of which has been delivered to Land Title Guarantee's Vail office care of Karen Biggs. If you have any questions, do not hesitate to contact me. Yours very truly, VAIL RESORTS MANAGEMENT COMPANY Diane H. riello Assistant G eral Counsel — Real Estate Enc. v •A�'. O��7vPiL JOBRECKENRIDGE KEYSTONE l�'I Heavenly. ROCKIZ�ESORTS "�'""�` •a SKI RESORT ^R r o Vail Resorts Management Company Post Office Box 959 137 Benchmark Road Avon, Colorado 81620 ej r VAIL R ESORTS* Just Another Day In Paradise" '0 (a 13 (t') '— 4 December 19, 2007 Ms. Karen Biggs Land Title Guarantee Company 108 South Frontage West Suite Vail, CO 81657 Via Hand Delivery Re: Letter of Credit Dear Karen: • • As we discussed enclosed please find a copy of the Core Site Employee Housing Agreement executed by Keith Fernandez on behalf of The Vail Corporation, d/b /a Vail Associates, Inc. I will provide you with a fully executed copy once executed by the Town of Vail and the Vail Reinvestment Authority. Also enclosed is the original letter of credit number 3091306 in the amount of . $17,345,789 issued by Bank of America, for the benefit of the Town of Vail as more fully set forth in the Core Site Employee Housing Agreement. As you will see from paragraph 1 of that Agreement, the parties agreed that Land Title Guarantee would hold the letter of credit. We understand that Land Title will hold the letter of credit in accordance with the terms of the Core Site Employee Housing Agreement. Please sign the enclosed copy of this letter acknowledging your receipt of the documents and return it to us. If you have any questions or concerns, please do not hesitate to contact me. Yours very truly, VAIL RESORTS MANAGEMENT COMPANY � Q fit/ 1 Diane H. f riello Assistant eral Counsel — Real Estate Enc. ,,Vail. O $ I�SKI RESORT (4 He KEYSTONE' aveN . � Tdon „ , „ , Y R OCKRESORrS "r"°� C0n Vail Resorts Management Company Post Office Box 959 137 Benchmark Road Avon, Colorado 81620 0 Acknowledged and Received: For Land Title Guarantee Company RESOLUTION NO.6 Series of 2007 ORIGIIVA A RESOLUTION AUTHORIZING THE VAIL REINVESTMENT AUTHORITY TO ENTER INTO AN AGREEMENT WITH THE VAIL CORPORATION AND THE TOWN OF VAIL REGARDING EMPLOYEE HOUSING OBLIGATIONS IN CONNECTION WITH THE ARRABELLE PROJECT. WHEREAS, the Vail Corporation, the Town of Vail and the Vail Reinvestment Authority (the "Authority'), entered into the Core Site Development Agreement, dated November 8, 2004; and WHEREAS, the Town and the Vail Corporation have agreed to amend the Core Site Development Agreement to allow the Arrabelle Project to receive a temporary certificate of occupancy while assuring the Town that the Vail Corporation will provide the employee housing required by the Core Site Development Agreement. NOW THEREFORE, BE IT RESOLVED BY THE VAIL REINVESTMENT AUTHORITY THAT: The Core Site Housing Agreement is hereby approved in substantially the same form as attached hereto. 2. This resolution shall take effect immediately upon its passage. INTRODUCED, PASSED AND ADOPTED at a regular meeting of the Vail Reinvestment Authority held this 18 day of December, 2007. Dick Cleveland Chairman ATTEST: Stan Zemler, Secretary/Executive Director Resolution No. 6, Series 2007 M CORE SITE EMPLOYEE HOUSING AGREEMENT ORIGIAI THIS CORE SITE EMPLOYEE HOUSING AGREEMENT ( "Agreement ") is made as of the 18th day of December, 2007, by and between the TOWN OF VAIL, a municipal corporation duly organized and existing under and by the Vail Town Charter (the "Town "), and THE VAIL CORPORATION d/b /a VAIL ASSOCIATES, INC., a Colorado corporation ( "Vail Associates "). Recitals: A. Vail Associates, the Town and the Vail Reinvestment Authority (the "Authority "), entered into the Core Site Development Agreement, dated as of November 8, 2004. Initially capitalized terms used but not defined herein shall have the meanings given them under the Core Site Development Agreement. B. All obligations of the Authority and obligations owed to the Authority have been satisfied and the Authority is not a necessary parry to this Agreement (as confirmed by the Authority by its execution at the end hereof). C. Paragraph 12 of the Core Site Development Agreement obligated Vail Associates to provide replacement employee housing for the Sunbird Lodge and incremental employee housing for additional development in the Lionshead area of the Town of Vail. The obligation for employee housing is referred to in the Core Site Development Agreement as the "Core Employee Housing Requirements." D. The Core Employee Housing Requirements have been determined to be equivalent to 120 employee housing beds (and the foregoing will be part of the parties' agreement hereunder). E. Paragraph 12 of the Core Site Development provides that provision of the Core Employee Housing Requirements shall be a condition to the issuance of any certificate of occupancy for the Core Site Project (now known as " Arrabelle Project "), and that Vail Associates could provide the employee housing on an interim basis for a period of five years. F. The Arrabelle Project is nearing completion and Vail Associates anticipates applying for a temporary certificate of occupancy in the near future. G. The parties differ on the interpretation of Paragraph 12 of the Core Site Development Agreement and on whether Vail Associates is in compliance with the terms of Paragraph 12. H. In order to resolve the differences between the parties and to avoid litigation, the parties now enter into this Agreement to insure that Vail Associates satisfies the Core Employee Housing Requirements in a timely manner and that necessary certificates of occupancy are issued for the Arrabelle Project. Agreement: NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements set forth herein, the parties covenant and agree as follows: 1. Vail Associates shall post an irrevocable letter of credit in the amount of $17,345,789 (the "Letter of Credit "), in a form satisfactory to the Town, with Land Title Guarantee Company to secure the Core Employee Housing Requirements. 2. The amount of the Letter of Credit shall be adjusted on April 1, 2008, and each April 1 thereafter, to an amount consistent with the rates set by the Town Council by resolution for payment of fees in lieu as required by Section 12 -23 -6 and Section 12 -24 -6, Vail Town Code (Chapters 12 -23 and 12 -24 of the Vail Town Code being referred to hereinafter as the "New Housing Ordinances "). 3. Upon posting of the Letter of Credit, the Core Employee Housing Requirements shall no longer act as a condition to the issuance of any certificate of occupancy for the Arrabelle Project. 4. Vail Associates shall use its best efforts to submit or cause to be submitted to the Town, by February 25, 2008, a complete development review application for a project or projects in the Town of Vail, which proposals shall include not less than 120 newly constructed employee housing beds to comply with the Core Employee Housing Requirements (provided the Town may not require more than 120 beds in the aggregate in relation to the Arrabelle Project), but may be part of larger mixed use development(s) on the North Day Lot and/or alternative location(s) in the Lionshead Master Plan Area or other location approved by the Town (collectively the "North Day Lot and/or Alternative Project "). The Town acknowledges and agrees that the North Day Lot and/or Alternative Project may involve direct or indirect ownership interests in favor of Vail Associates (or its affiliates) and/or third parties. The Town shall consider and process the review of such application promptly and in good faith, subject to the application being in compliance with the Vail Town Code, and by reasonable application of the Town's adopted development review requirements that are applicable to the particular site(s) (the "Review Standards "). 5. Vail Associates may amend or alter any North Day Lot and/or Alternative Project development application, or withdraw any such application from consideration by the Town and submit a new application, subject to its obligations in Section 6. 6. Vail Associates and/or any third party developers shall obtain approval of the development review application for the North Day Lot and/or Alternative Project on or before November 5, 2008 (the "Development Review Approval Date," subject to extension as provided in Paragraph 13 herein), and the Town shall work in good faith to provide any approvals by such date for a timely filed application, all in accordance with the Review Standards. 7. Vail Associates and/or such other third party developer shall obtain a building permit for the construction of the North Day Lot and/or Alternative Project and shall commence construction of a North Day Lot and/or Alternative Project no later than May 1, 2009 (the "Construction Commencement Date," subject to extension as provided in Paragraph 13 herein), N and shall actively prosecute construction of the North Day Lot and/or Alternative Project to completion pursuant to a building permit or permits for the construction of the North Day Lot and/or Alternative Project. Upon issuance of a temporary certificate of occupancy for the North Day Lot and/or Alternative Project, the Letter of Credit shall be promptly returned to Vail Associates and Vail Associates shall be deemed to have satisfied the Core Employee Housing Requirements. 8. Any employee housing units provided pursuant to this Agreement shall be permanently restricted by provisions incorporated into the deed or other instrument. Such provisions shall be in accordance with Town Code and the deed, as restricted, or other instrument shall be recorded in the records of the Clerk and Recorder of Eagle County. 9. Breach by Vail Associates A "breach" or default" by Vail Associates under this Agreement shall be defined as: (i) the failure of Vail Associates no later than the Development Review Approval Date to obtain from the Town a complete development review approval for the North Day Lot and/or Alternative Project; (ii) the failure of Vail Associates, by no later than the Development Review Approval Date, to obtain from the Colorado Department of Transportation (CDOT), if necessary, all approvals by CDOT for the North Day Lot and/or Alternative Project; (iii) the failure of Vail Associates to obtain a building permit for the construction of the North Day Lot and/or Alternative Project and to commence construction of the North Day Lot and/or or Alternative Project on or before the Construction Commencement Date, or (iv) any failure by Vail Associates to actively pursue construction of the North Day Lot and/or Alternative Project pursuant to a building permit for the construction of the North Day Lot and/or Alternative Project once construction has commenced. 10. Breach by the Town A "breach" or "default" by the Town under this Agreement shall be defined as follows: (i) failure by the Town to timely, diligently and in good faith consider and process the development review application for the North Day Lot and/or Alternative Project in accordance with the Review Standards, or (ii) failure of the Town to issue building permits or other requisite approvals for construction if proper application is made therefor under Town Code based on construction documents that conform to the approved development plan. 11. Mandatory Mediation In the event a Notice of Breach is given by either party, the parties shall retain the services of a mediator, acceptable to both parties, within 15 days of the receipt of the Notice of Breach. In the event the parties are unable to agree on a mediator within 15 days, the parties may exercise any remedy provided herein and no mediation will be required. In the event the parties agree on a mediator, the parties shall engage in mediation for a period not to exceed sixty (60) days from the date of retention of a mediator. Neither party may exercise its Remedy provided for in Paragraphs 12 and 13 below until the completion of the period for mediation. Either party may also cure any default during the mediation period. 12. Remedies for Breach by Vail Associates The sole and exclusive remedy of the Town for a breach or default by Vail Associates shall be to draw on the Letter of Credit. Any proceeds that the Town may retain shall be applied solely to the Town's procurement in good faith of employee housing units in accordance with Town Code and to the end of furnishing the requisite 120 beds. 3 13. Remedies for Breach by the Town The sole and exclusive remedy of Vail Associates for breach by the Town shall be: (i) for a breach occurring prior to the Development Review Approval Date, an extension of the Development Review Approval Date and the Construction Commencement Date by six (6) months, but not to be sooner than six (6) months after the date upon which the breach by the Town ceases; (ii) for a breach occurring after the Development Review Approval Date but before the Construction Commencement Date, an extension of the Construction Commencement Date for a period of six (6) months, but not to be sooner than six (6) months after the date upon which the breach by the Town ceases. 14. Tollinp, of Construction Commencement Date In the event of any third -party appeal or litigation challenging any development review approval hereunder, the parties will consult regarding the tolling of the Construction Commencement Date. In the event an injunction is granted enjoining construction, the Construction Commencement Date will be tolled and further extended until the injunction is lifted. If the development review approval is not so affirmed, the parties will mutually determine in good faith a new schedule for re- processing the development review approval in accordance with the other terms of this Agreement, with the Development Review Approval Date and the Construction Commencement Date to be extended accordingly. 15.' Notices Any notice required or permitted under the terms of this Agreement shall be in writing, may be given by the parties hereto or such parties' respective legal counsel, and shall be deemed given and received (i) when hand delivered to the intended recipient, by whatever means; (ii) three (3) business days after the same is deposited in the United States mails, with adequate postage prepaid, and sent by registered or certified mail, with return receipt requested; (iii) one (1) business day after the same is deposited with an overnight courier service of national or international reputation having a delivery area encompassing the address of the intended recipient, with the delivery charges prepaid; or (iv) when received via facsimile on the intended recipient's facsimile facilities accessed by the applicable telephone number set forth below (provided such facsimile delivery and receipt is confirmed on the facsimile facilities of the noticing party). Any notice under clause (i), (ii) or (iii) above shall be delivered or mailed, as the case may be, to the appropriate address set forth below. If to Vail Associates: Vail Corporation c/o Vail Resorts Development Company Post Office Box 959 137 Benchmark Road Avon, Colorado 81620 Attention: Keith Fernandez, President Fax No.: (970) 845 -2555 Phone: (970) 845 -2359 4 If to the Town or the Authority: Town of Vail Stanley Zemler, Town Manager 75 South Frontage Road Vail, Colorado 81657 Phone: (970) 479 -2105 Fax No.: (970) 479 -2452 Any party may change its addresses and/or fax numbers for notices pursuant to a written notice which is given in accordance with the terms hereof. 16. Attorneys' Fees In the event any legal proceeding arises out of this Agreement and is prosecuted to final judgment, the prevailing party shall be entitled to recover from the other party all of the prevailing party's costs and expenses incurred in connection therewith, including reasonable attorneys' fees (and any presiding court will be bound to make this award). 17. Waiver No failure by either party hereto to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement, or to exercise any right or remedy consequent upon a breach of this Agreement, will constitute a waiver of any such breach or of such or any other covenant, agreement, term or condition. Either party by giving notice to the other party may, but will not be required to, waive any of its rights or any conditions to any of its obligations hereunder. No waiver will affect or alter the remainder of this Agreement, but each and every other covenant, agreement, term and condition of this.Agreement will continue in full force and effect with respect to any other then existing or subsequent breach. 18. Applicable Law The laws of the State of Colorado will govern the interpretation and enforcement of this Agreement. 19. Bindin Effect ffect This Agreement will be binding on and inure to the benefit of the parties hereto, and their successors and assigns. 20. Time of Essence Time is of the essence of this Agreement. The parties will make every reasonable effort to expedite the subject matters hereof and acknowledge that the successful performance of this Agreement requires their continued cooperation. 21. Counterparts This Agreement may be executed in counterparts, each of which will be an original and all of which will constitute one and the same instrument. 22. Jointly Drafted; Rules of Construction The parties hereto agree that this Agreement was jointly drafted, and, therefore waive the application of any law, regulation, holding, or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document. 23. Entire Agreement This Agreement represents the entire agreement between the parties hereto with respect to the subject matter hereof, and all prior or extrinsic agreements, undertakings or negotiations shall be deemed merged herein, superseded hereby, and of no force 5 or effect, and the parties mutually acknowledge and agree that Paragraph 12 of the Core Site Development Agreement is superseded and terminated. [Balance of page intentionally left blank] 0 IN WITNESS WHEREOF, Vail Associates, the Town and the Authority have made this Agreement as of the day, month and year first above written. VAIL REINVESTMENT AUTHORITY By : g , c/ /,G'LI 1js Name: Title: du w2 b r` STATE OF COLORADO � ss: COUNTY OF ) The foregoing instrument was acknowledged before me this day of 2007, by 1!96n Z.c�l rw- as of Vail Reinvestment Authority. Witness my hand and official seal. My commission expires: ,•gib`` ` `' °`° °. ,` • c�. No c ( 2� .1. Q `•" Q co �'•, J ' •.rSigat�� a blocks continue on following page] TOWN OF VAIL By: / 7 !,-- Name: Title: ATTES orel i onaldson, Town Clerk STATE OF COLORADO ss: COUNTY OF The foregoing instrument was acknowledged before me this .0 ' day of 2007, by .5& A v„ 7,- ri, l a r as ►w+ of the Town of Vail. Witness my hand and official seal. My commission expires: �! o '�uq r Not signature blocks continue on following page] THE VAIL CORPORATION, d/b /a VAIL ASSOCIATES, INC., a Colo corporation By: ~z Keith Fernandez, President and COO -VRDC The foregoing instrument was acknowledged before me this I q,+k day of DCGtr 2007, by Keith Fernandez, President and COO -VRDC of The Vail Corporation, d/b /a Vail Associates, Inc., a Colorado corporation. STATE OF COLORADO ) ss: COUNTY OF I� ) IT Witness my hand and official seal. My commission expires: LI - II —II C/ 6 - - Notary Public A"""d as to Farm van its By: Naaoe ` IAN MAURIELLO Date: . � BankqfAmeric a�� BANK OF AMERICA - CONFIDENTIAL PAGE: 1 DATE: DECEMBER 18, 2007 IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER: 3091306 C O P ISSUING BANK BANK OF AMERICA, N.A. )POP 1000 W. TEMPLE STREET 7TH FLOOR, CA9- 705 -07 -05 LOS ANGELES, CA 90012 -1514 BENEFICIARY APPLICANT THE TOWN OF VAIL, STATE OF COLORADO THE VAIL CORPORATION 75 S. FRONTAGE ROAD WEST DBA VAIL ASSOCIATES, INC. VAIL, CO 81657 390 INTERLOCKEN CRESCENT, STE 1000 BROOMFIELD, CO 80021 AMOUNT NOT EXCEEDING USD 17,345,789.00 NOT EXCEEDING SEVENTEEN MILLION THREE HUNDRED FORTY FIVE THOUSAND SEVEN HUNDRED EIGHTY NINE AND 001100'S US DOLLARS EXPIRATION DECEMBER 18, 2008 AT OUR COUNTERS WE HEREBY ESTABLISH IN YOUR FAVOR OUR IRREVOCABLE STANDBY LETTER OF CREDIT WHICH IS AVAILABLE WITH BANK OF AMERICA, N.A. BY PAYMENT AGAINST PRESENTATION OF THE ORIGINAL OF THIS LETTER OF CREDIT AND YOUR DRAFTS AT SIGHT DRAWN ON BANK OF AMERICA, N.A., ACCOMPANIED BY THE DOCUMENT DETAILED BELOW: BENEFICIARY'S SIGNED STATEMENT STATING THE FOLLOWING: QUOTE 1) THERE HAS BEEN A BREACH OR DEFAULT BY THE VAIL CORPORATION DBA VAIL ASSOCIATES, INC. UNDER THE CORE SITE EMPLOYEE HOUSING AGREEMENT DATED AS OF DECEMBER 18, 2007 BY AND BETWEEN THE TOWN OF VAIL AND THE VAIL CORPORATION DBA VAIL ASSOCIATES, INC. AND SUCH BREACH OR DEFAULT HAS NOT BEEN CURED AS PROVIDED THEREIN. 2) THE AMOUNT DRAWN IS REQUIRED TO REMEDY SUCH BREACH OR DEFAULT. 3) SUCH DRAW IS THE TOWN OF VAIL'S SOLE AND EXCLUSIVE REMEDY FOR SUCH BREACH OR DEFAULT AND WILL BE APPLIED IN ACCORDANCE WITH THE TERMS OF THE CORE SITE EMPLOYEE HOUSING AGREEMENT. UNQUOTE PARTIAL DRAWINGS AND MULTIPLE PRESENTATIONS ARE NOT PERMITTED. THIS IRREVOCABLE LETTER OF CREDIT SHALL EXPIRE ON DECEMBER 18, 2008 AND SHALL BE AUTOMATICALLY EXTENDED FOR SUBSEQUENT ONE YEAR TERMS UNLESS AT LEAST SIXTY (60) DAYS PRIOR TO ANY EXPIRATION DATE, WE ORIGINAL 05- 17 -1486B 7 -2000 BankofAmeric a� BANK OF AMERICA - CONFIDENTIAL PAGE: 2 THIS IS AN INTEGRAL PART OF LETTER OF CREDIT NUMBER: 3091306 NOTIFY YOU, WITH A COPY TO THE VAIL CORPORATION DBA VAIL ASSOCIATES, INC. BY REGISTERED MAIL OR OVERNIGHT COURIER SERVICE AT THE ABOVE ADDRESS, THAT WE ELECT NOT TO EXTEND THIS LETTER OF CREDIT FOR SUCH ADDITIONAL PERIOD. THIS LETTER OF CREDIT MAY NOT BE DRAWN UPON PRIOR TO NOVEMBER 6, 2008. WE HEREBY ENGAGE WITH YOU THAT DRAFT(S) DRAWN UNDER AND IN COMPLIANCE WITH THE TERMS OF THIS LETTER -OF CREDIT WILL BE DULY HONORED UPON PRESENTATION TO US AT BANK OF AMERICA, N.A., TRADE OPERATIONS CENTER, 1000 W. TEMPLE STREET, MAIL CODE: CA9- 705- 07 -05, LOS ANGELES, CA 90012 -1514, ATTN: STANDBY LETTER OF CREDIT DEPARTMENT ON OR BEFORE THE EXPIRATION DATE OR ANY AUTOMATICALLY EXTENDED EXPIRATION DATE AS SPECIFIED HEREIN. THIS LETTER OF CREDIT IS SUBJECT TO THE INTERNATIONAL STANDBY PRACTICES 1998, ICC PUBLICATION NO. 590. IF YOU REQUIRE ANY ASSISTANCE OR HAVE ANY QUESTIONS REGARDING THIS TRANSACTION, PLEASE CALL 213 - 481 -7844. Q/ --- u ------ ------ I -- -------- AUTHORIZED SIGNATURE THIS DOCUMENT CONSISTS OF 2 PAGE(S). ORIGINAL 05- 17 -1486B 7 -2000