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HomeMy WebLinkAbout10/17/2006 Blue Sheet Amendment to Dove Mountain Development Agreements TOWN COUNCIL MEETING INFORMATION MEETING DATE: TOWN OF MARAN A October 17,2006 AGENDA ITEM: J. 1 TO: MAYOR AND COUNCIL FROM: Frank Cassidy, Town Attorney SUBJECT: Resolution No. 2006-166: Relating to Development; Approving and authorizing the execution of an Amendment to Dove Moun- tain Development Agreements with Cottonwood Properties, Inc., and Lawyers Title of Arizona under Trust Nos. 7804-T and 7805- T. DISCUSSION This proposed Amendment to the Dove Mountain Developments Agreements addresses three specific items from earlier development agreements. First, it reduces the size of the land encumbered by a deed of trust which secures the Developer's obligation to cover the costs ofthe Tortolita Mountain Preserve. The cost to prepay the Tortolita Preserve lease prior to October 25,2010 (when the ability to prepay ends) is $7,920,000. As re- duced in size in this proposed amendment, the value of the property encumbered by the deed of trust is estimated at $20,000,000. This amendment also defines how the land area may be further reduced as the land value increases or as other contributions are made to reduce the need for se- curity. The accompanying resolution also authorizes the Town Manager to carry out the Town's obligations relating to the deed of trust, including a further reduction in the size of the land used as security. Second, the amendment provides for the description of the Trailhead parking property, which is defined in earlier agreements, by designating the particular Trailhead parking area on a subdivi- sion plat which will be submitted to the Town for approval. When the Town approves the subdi- vision plat depicting the revised Trailhead parking lot, that approval will effectively also approve the modified description of the revised Trailhead parking lot. Third, this amendment clarifies distribution of developer reimbursement for qualified infrastruc- ture expenses. Previous agreements have established the Town's obligation to reimburse the Developer for certain infrastructure improvement expenditures. This amendment clarifies the tracking of that reimbursement obligation and provides for reimbursement to the Developer for distribution to other entities that pay qualified infrastructure expenses (for example, qualified expenses paid for by the Dove Mountain Community Facilities District which is referred to as the "New CFD" in the agreements). This amendment simply clarifies and carries out the intended purposes of obligations set forth in previous Dove Mountain development agreements. {00002708.DOC I} RECOMMENDATION Staff recommends adoption of Resolution No. 2006-166, approving and authorizing execution of the Amendment to Dove Mountain Development Agreements. A TT ACHMENT(S) Amendment to Dove Mountain Development Agreements. SUGGESTED MOTION I move to adopt Resolution No. 2006-166. {00002708.DOC /} - 2 - FJC/cds 10/5/06 MARANA RESOLUTION NO. 2006-166 RELATING TO DEVELOPMENT; APPROVING AND AUTHORIZING THE EXECUTION OF AN AMENDMENT TO DOVE MOUNTAIN DEVELOPMENT AGREEMENTS WITH COTTONWOOD PROPERTIES, INC., AND LAWYERS TITLE OF ARIZONA UNDER TRUST NOS. 7804-T AND 7805-T. WHEREAS, the Mayor and Council find that the terms and conditions of the Amendment to Dove Mountain Development Agreements are in the best interest of the Town. NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COUNCIL OF THE TOWN OF MARANA, ARIZONA, that the Amendment to Dove Mountain Development Agreements between the Town of Marana, Cottonwood Properties, Inc., and Lawyers Title of Arizona under Trust Nos. 7804- T and 7805- T, attached to and incorporated by this reference in this resolution as Exhibit A is hereby approved, and the Mayor is hereby authorized to execute it for and on behalf ofthe Town of Marana. BE IT FURTHER RESOLVED that the Town Manager is authorized to execute all documents necessary to release from the Deed of Trust those portions of the revised security parcel that cause the revised security parcel to exceed twice the Preserve Lease buyout cost, as provided in paragraph 1 of the Amendment to Dove Mountain Development Agreements. BE IT FURTHER RESOLVED that the Town's Manager and staff are hereby directed and authorized to undertake all other and further tasks required or beneficial to carry out the terms, obligations, and objectives ofthe aforementioned agreement. PASSED AND ADOPTED BY THE MAYOR AND COUNCIL OF THE TOWN OF MARANA, ARIZONA, this 17th day of October, 2006. Mayor Ed Honea ATTEST: APPROVED AS TO FORM: Jocelyn C. Bronson, Town Clerk Frank Cassidy, Town Attorney {00002709.DOC /} FJC/cds AMENDMENT TO DOVE MOUNTAIN DEVELOPMENT AGREEMENTS (Bajada, Phase 1 and Canyon Pass) (Amends Documents Recorded in Docket 11594 at Page 3855, Docket 12017 at Page 6571, and in Docket 12525 at Page 1451) This Amendment (this "Amendment") is entered into by and among the Town of Maran a, an Arizona municipal corporation (the "Town"), Cottonwood Properties, Inc., an Arizona corporation ("Cottonwood"), Lawyers Title of Arizona, Inc., an Arizona corporation, as Trustee under Trust No. 7804- T and 7805- T (collectively the "Trusts"). The Town, Cottonwood and the Trusts are sometimes collectively referred to as the "Parties," anyone of which is sometimes individually referred to as a "Party." RECITALS A. The Parties are parties to that certain Amendment to Development Agreements made as of June 19,2001 and recorded in Docket 11594 at Page 3855 and that certain Amendment to Development Agreements made as of April 5, 2005 and recorded in Docket 12525 at Page 1451 in the Office of the Pima County Recorder (collectively "Resort Agreement"), and to that certain Amendment to Development Agreements made as of March 18,2003 and recorded in Docket 12017 at Page 6571 in the Office of the Pima County Recorder ("Trailhead Agreement"). The Parties (or their predecessors in interest) are parties to the Development Agreements (as defined in the Resort Agreement) and the Resort Agreement and the Development Agreements shall be collectively referred to herein as the "Current Development Agreements". B. The Trusts are the current owners of a majority of the property described and depicted in the Current Development Agreements (exclusive of the District 1 Property described in the Phase 1 Agreement) and are the assignees ofthe Developer's rights and obligations under the Current Development Agreements. C. Cottonwood is the intended master developer of the majority of the property described and depicted in the Current Development Agreements (exclusive ofthe District 1 Property described in the Phase 1 Agreement) and all references to the "Developer" herein refer to any and all of Cottonwood, the Trusts (and their beneficiaries) and/or such other developer( s), if any, as the case may be, to whom the Trusts hereafter assign all or a portion of their rights and obligations under the Current Development Agreements in accordance with the provisions ofthe Current Development Agreements. D. The Deed of Trust (as defined in the Resort Agreement) was executed to provide security for the Developer obligations under the Resort {OO002672.DOC I} 1 Agreement to fund the lease payments due under the Preserve Lease (as defined in the Resort Agreement). The cost to prepay the Preserve Lease prior to October 25, 2010 is Seven Million Nine Hundred Twenty Thousand Dollars ($7,920,000) ("Preserve Lease Buyout Cost"). The Parties desire to substitute the land described in Exhibit A attached hereto ("Revised Security Property") for the land currently encumbered by the Deed of Trust. KB Appraisers has appraised the current market value of the Revised Security Property at Twenty Million Dollars ($20,000,000). E. Based on revised plans for the Resort Hotel (as defined in the Resort Agreement), the Parties desire to utilize the property described in Exhibit B attached hereto ("Revised Trailhead") instead ofthe Trailhead (as defined in the Trailhead Agreement). F. The Qualified Expenses (as defined in the Resort Agreement) have been funded by the New CFD, Red Hawk Canyon Community Facilities District No 2 ("CFD #2") and the Developer (collectively the "Public Improvement Payees") and the Parties desire to prescribe the method for allocating the reimbursements of the Qualified Expenses to and among the Public Improvement Payees. G. The Revised Security Property lies within the boundaries of the New CFD. The New CFD has adopted an assessment methodology under which the existing assessment would be reallocated to assess the Revised Security Property and other land within the boundaries ofthe New CFD. AGREEMENT NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties state, confirm and agree as follows: 1. Deed of Trust. Upon execution ofthis Amendment, the Town and the Trusts shall execute the First Amendment to Deed of Trust attached to this Amendment as Exhibit C. From time to time, the Developer may ask the Town to release all or a portion of the Revised Security Parcel from the Deed of Trust ("Release Parcel") and such request at the Developer's discretion may include the payment of cash to the Town ("Release Payment") and such Release Payment shall be deemed part of the Preserve Costs under the Resort Agreement. Prior to the Benchmark Date (as defined in the Resort Agreement) and upon the Developer's request, the Town shall execute a reconveyance deed for the Release Parcel provided that the remainder of the Revised Security Property encumbered by the Deed of Trust has a value equal to or greater than twice the Preserve Lease Buyout Cost. For purposes of the calculation in the preceding sentence, the Preserve Lease Buyout Cost shall be deemed reduced by the amount of any Release Payments paid to the Town. For purposes of complying with the foregoing formula, the Developer may add land to the Revised Security Parcel and the Town may order a third party appraisal to verify compliance with such formula for land proposed by the Developer to remain as part of the Revised Security Parcel. All costs incurred for such appraisal shall promptly be reimbursed by the Developer. If the Developer tenders payment for the Preserve Lease Buyout Cost on or before October 25,2010, the Town shall {00002672.DOC /} 2 prepay the Preserve Lease to the State of Arizona. In this event or upon the Benchmark Date, the Town shall execute a reconveyance deed for all property encumbered by the Deed of Trust and the Developer shall have no further obligation for payment of the Preserve Costs. The Town hereby consents to the New CFD allocating an assessment to the Revised Security Property as long as the fair market of the Revised Security Property minus the New CFD assessment on the Revised Security Property equals or exceeds twice the Preserve Lease Buyout Cost. 2. Trailhead Parking Lot. Cottonwood shall prepare a subdivision plat that depicts the Revised Trailhead and dedicates the Revised Trailhead to the Town. The Town's approval ofthe final plat shall constitute the Town's approval of the Revised Trailhead in place ofthe Trailhead, and the dedication of the Revised Trailhead upon recordation of the plat shall satisfy and supersede the obligation to provide the Trailhead under the Trailhead Agreement. The Developer or its assignee shall construct bank protection for the Revised Trailhead in accordance with the requirements set forth on the development plan approved by the Town of Marana for the Resort Hotel. 3. Qualified Expenses. On or before December 31, 2006, the Developer shall provide the Town with a list of all Qualified Expenses paid by the Public Improvement Payees. The Town shall reimburse to the Developer all Qualified Expenses paid by the Public Improvement Payees and the Developer shall prioritize and distribute reimbursement ofthe Qualified Expenses to the Public Improvement Payees. To the extent that the Developer has previously reimbursed a Public Improvement Payee for Qualified Expenses by paying assessments levied for funding of the Qualified Expenses, such reimbursed Qualified Expenses may at the Developer's election be retained by the Developer. The list of all Qualified Expenses paid by the Public Improvement Payees shall be updated on or before December 31 of each year until the Town's obligation to reimburse Qualified Expenses terminates. 4. Public Purposes. The Parties recognize and acknowledge that the development ofthe Resort Hotel and the resulting augmentation of revenues and commercial and/or recreational activities upon and about such land will directly benefit the Town and its residents. The Parties further acknowledge that development of the matters described in the Current Development Agreements and other public infrastructure are desirable and will result in benefits to the public health, welfare and safety ofthe Town and its residents by (i) providing well planned development with appropriate open space and recreational areas, (ii) increasing tax and other revenues to the Town based on businesses and improvements to be constructed, (iii) creating jobs through the construction and operation of new businesses, (iv) providing for new public facilities as described in this Amendment and in the Current Development Agreements, and (v) otherwise generally enhancing the Town for the benefit and economic welfare of its residents, and for these reasons the Town will take the actions described in this Amendment. 5. Miscellaneous. The wording of this Amendment has been arrived at by negotiation between the Parties, and, in the event of any ambiguity, this Amendment shall not be construed in favor of or against any Party on account of such Party having prepared any draft or final version of this Amendment. This Amendment and the Current Development Agreements constitute the entire agreement between the Parties and the Parties expressly acknowledge that there are no other {00002672.DOC /} 3 agreements or understandings in regard to this transaction other than as set forth herein or contained within other written agreements referred to herein. The recitals set forth herein are true and correct in all material respects and are incorporated herein by reference. Each Party shall from time to time execute and deliver such further instruments as the other Party or its counsel may reasonably request to effectuate the intent of this Amendment, including, but not limited to, documents necessary for compliance with the laws, ordinances, rules or regulations of any applicable governmental authorities. Except as modified by this Amendment, the Parties hereby affirm that the Current Development Agreements are in full force and effect. IN WITNESS WHEREOF the Parties have executed this Amendment on the last signature date below, which shall be the effective date ofthis Amendment. ATTEST: THE "TOWN": THE TOWN OF MARANA, an Arizona municipal corporation Jocelyn Bronson Ed Honea, Mayor APPROVED AS TO FORM: Frank Cassidy, Town Attorney "DEVELOPER": COTTONWOOD PROPERTIES, INC., an Arizona corporation, THE "TRUSTS": LAWYERS TITLE OF ARIZONA, INC., an Arizona corporation, as Trustee under Trust No. 7804- T and Trust 7805- T only, and not in its corporate capacity By: Its: By: Its: {OOOO2672.DOC /} 4 STATE OF ARIZONA ) )ss: COUNTY OF PIMA ) ACKNOWLEDGED before me this _ day of , the Arizona, Inc., as Trustee under Trust Nos. 7804-T, and 7805-T. , 2006, by of Lawyers Title & Trust of Notary Public Notary Seal STATE OF ARIZONA ) ) COUNTY OF PIMA ) This instrument was acknowledged before me this day of by , the Properties Inc., an Arizona corporation. ,2006 of Cottonwood Notary Public Notary Seal {00002672.DOC I} 5 {00002672.DOC I} EXHIBIT A (Map and Legal Description of the Revised Security Property) 6 EXHIBIT B (Map and legal of the Revised Trailhead) {OOOO2672.DOC I} 7 EXHIBIT C FIRST AMENDMENT TO DEED OF TRUST This First Amendment to Deed of Trust (this "Amendment") is made as of 2006 by and among the Town of Marana, an Arizona municipal corporation (the "Town"), and Lawyers Title of Arizona, Inc., an Arizona corporation, as Trustee under Trust No. 7804- T and 7805- T (collectively the "Trusts"). RECITALS: A. The Town is the Beneficiary and the Trusts are the Trustor under that certain First Deed of Trust and Assignment of Rents recorded in Docket 12523 at Page 2216 in the office of the Pima County Recorder ("Deed of Trust"). The Trusts own all of the property encumbered by the Deed of Trust. B. Pursuant to the terms of that certain Amendment to Development Agreements made as of , 2006 and recorded in Docket _ at Page _ in the Office of the Pima County Recorder, the parties hereto desire to modify the property that is encumbered by the Deed of Trust. NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto state, confirm and agree as follows: AGREEMENT 1. Deed of Trust. The property described in Exhibit 1 ("Revised Trustor Property") is hereby substituted for and replaces the Trustor Property described under the Deed of Trust. All portions of the Trustor Property originally encumbered by the Deed of Trust which are not included within the Revised Trustor Property are hereby released and reconveyed to the persons legally entitled thereto. 2. Miscellaneous. Except as modified herein, the parties herby affirm that the Deed of Trust is in full force and affect. {00002672.DOC I} 1 IN WITNESS WHEREOF the parties executed this Amendment the day and year written above. TRUSTOR: LAWYERS TITLE OF ARIZONA, INC., an Arizona corporation, as Trustee under Trust 7804- T and Trust 7805- T only, and not in its corporate capacity BENEFICIARY: THE TOWN OF MARANA, an Arizona municipal corporation By: Ed Honea, Mayor By: ATTEST: Its: Jocelyn Bronson, Town Clerk APPROVED AS TO FORM: Frank Cassidy, Town Attorney {00002672.DOC I} 2 STATE OF ARIZONA ) )ss: COUNTY OF PIMA ) ACKNOWLEDGED before me this _ day of Ed Honea, Mayor of The Town Of Marana, an Arizona municipal corporation. , 2006, by Notary Public Notary Seal STATE OF ARIZONA ) )ss: COUNTY OF PIMA ) ACKNOWLEDGED before me this _ day of ,the Arizona, Inc., as Trustee under Trust 7804-T and 7805-T. , 2006, by of Lawyers Title & Trust of Notary Public Notary Seal W JH\at\092106\deedtst\61 {00002672.DOC /} 2 EXHIBIT 1 (Map and legal of the Revised Trustor Property) {OOOO2672.DOC I} 3 ~--~ MARANA ~/ j" TOWN OF MARANA COMMUNITY INFORMATION SERVICES Noyember 15,2006 Bill Hallinan Vice President Cottonwood Properties, Inc. 3567 E. Sunrise Drive, Suite 219 Tucson, AZ 85718 RE: Amendment to Dove Mountain Development Agreements and First Amendment to Deed of Trust Dear Mr. Hallinan: Included with this letter are two original Amendment to Dove Mountain Development Agreements, as well as a recorded copy of the agreement and a recorded copy of the First Amendment to Deed of Trust. These are being forwarded to you for your files. Please let me know if I can be of further assistance. Sincerely, ~ /JJ;JJJkJ Tim Mattix Records and Elections Coordinator Town of Maran a, Clerk's Office Enclosures 11555 W. CIVIC CENTER DRIVE, BLDG. A1 - MARANA, ARIZONA 85653-7007 _ TELEPHONE: (520) 382-1999 _ FAX: 382-1998