C150274 Feasibility Study

• Contract/PO #: C150274
• Contractor Name: Yuma County Water Authority Public Improvement District
• Contract Type: Loan
• Water District: 0
• County: Yuma
• Loan Projects - Doc Type: Feasibility Study

Section 3(a), subject to Sellers' cooperation described in Section 6 below.
Buyer shall notify Seller of any title defector encumbrance with respect to
the Water Rights and/or Covenant Water Rights (as defined in
Section 8(c) below) that it finds unsatisfactory on or before the Due
Diligence Date. Whether an existing encumbrance or title defect is
deemed unsatisfactory and/or adequately protected by the covenants in
Section I1, are matters within Buyer's sole discretion. Sellers agree that
Buyer may, in its sole discretion and for no additional consideration,
extend• the time for Buyers review of title as provided for under this
Section 3(a) for an additional period not to exceed twenty-five (25) days
by delivering written notice to Sellers prior to the Due Diligence Date in
which case the Due Diligence Date will be extended for such additional
period but only with respect to the foregoing Condition Precedent.
Buyer's notice for such extension shall specify the duration of said
extension and indicate the current status of Buyer's title review, including
any title defects or encumbrances deemed unsatisfactory at that time.
Buyer acknowledges and agrees that no such extension shall extend the
Closing Date or any other date in this Agreement without Sellers'
approval. The foregoing Condition Precedent is for the benefit of Buyer.
(b} Bond Approval and Financing. Buyer currently contemplates the creation
of the District for the purpose of issuing bonds to pay some or all of the
Purchase Price, and has adopted resolutions placing such matters to a vote
of the public in the November, 2008 election. Sellers hereby agree that
Buyer's obligation to proceed to Closing is subject to the satisfaction of
the following conditions on or before the Closing Date: (i) Buyer having
obtained a successful result from the applicable electorate approving the
issuance of such bonds and the formation of the District in an amount
sufficient to raise the Purchase Price; (ii) a certification of the result of
such election from the applicable authorities; (iii) no challenge to the
result of such election having been filed; and (iv}Buyer's receipt of
proceeds from the sale of such bonds or, in Buyer's sole discretion, from
other sources in an amount sut~icient to fund the Purchase Price prior to
the Closing Date. Buyer hereby agrees to use commercially reasonable
efforts to raise the Purchase Price through the sale of the above-referenced
bonds. Buyer shall notify Sellers on or before December 17, 2008, as to
Buyer's progress in satisfying the above-described conditions. The
foregoing Condition Precedent is for the benefit of Buyer.
(c) Water Lease. The Parties' obligation to proceed to Closing is subject to
Buyer and/or Sellers having negotiated and entered into a lease of the
Water Rights to RRWCD (the "Water Lease") on or before the Closing.
The Water Lease shall be in a form approved by each of Sellers, Buyer
and RRWCD on or before the Due Diligence Date and shall include at
least the following terms; (i) no less than x5,000,000 in rental to be fully
paid in advance to Sellers as the Lease Payment on or before Closing in a
manner consistent with this Agreement, (ii) a twenty (20) yeaz term,
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