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Home My WebLink AboutSRCEA Item 5 - Ex B - Escrow Agmt1 DOCS 124394-000002/3139295.7 ESCROW AGREEMENT This ESCROW AGREEMENT ("Escrow Agreement") is made and entered into as of _________________, 2018 (the "Effective Date"), by and between THE CITY OF TEMECULA, a California municipal corporation ("City of Temecula"), SMER Research 1, LLC,a California Limited Liability Company ("Power Provider"), the Southwest Riverside County Energy Authority, a California joint powers authority ("SRCEA" or "Purchaser"), and CHICAGO TITLE COMPANY ("Escrow Holder") having an address of 701 B. Street, Suite 1120, San Diego, CA 92101, Attn: Della DuCharme (Della.ducharme@ctt.com)(collectively, the "Parties"). RECITALS WHEREAS, Power Provider entered into several Original Agreements (defined below) with the City of Temecula for the purchase of power from a solar power generating facility to be located on land secured within the Santa Margarita Ecological Reserve ("SMER") being developed by the Power Provider; and WHEREAS, the changes in California law amending the "The Renewable Energy Self-Generation Bill Credit Transfer Program"or "RES-BCT"and effective January 1, 2017 allowed the City of Temecula and the City of Lake Elsinore (collectively, the "Cities") to enter into that certain Joint Powers Agreement of the Southwest Riverside County Energy Authority ("Joint Powers Ag reement") establishing the SRCEA for the purpose of utilizing the expanded opportunities afforded to public entities by the revised RES-BCT program; and WHEREAS, the Cities have negotiated new agreements between the SRCEA and Power Provider to provide for the purchase of power from the solar power generating facility in the SMER to take advantage of the revised RES-BCT Program which are referred to in paragraphs 1(b) and 1(c) ("Revised Agreements"); and WHEREAS, the City of Temecula and the Power Provider now wish to terminate the Original Agreements so that the Revised Agreements can be effectuated by the Parties; and WHEREAS, the Power Provider and City of Temecula wish to have that certain AGREEMENT TO TERMINATE AND RESCIND CERTAIN AGREEMENTS BETW EEN CITY OF TEMECULA AND SMER RESEARCH 1 CONCERNING THE SANTA MARGARITA SOLAR POW ER GENERATING FACILITY AND CERTAIN IMPLEMENTING DOCUMENTS RELATED THERETO, between the City of Temecula and the Power Provider ("Termination Agreement") to become effective concurrently with the receipt of all fully executed Revised Agreements and required consents, as described in more detail below; and WHEREAS, the Revised Agreements shall not become effective until the effective date of the Termination Agreement; and WHEREAS, Escrow Holder is willing to accept the Original Agreements and Revised Agreements and hold and release said Original Agreements and Revised Agreements in accordance with the terms and conditions set forth below. NOW , THEREFORE, for and in consideration of the promises hereto, the covenants and agreements hereinafter made, the receipt and sufficiently of which are hereby acknowledged the Parties hereto agrees as follows: 2 DOCS 124394-000002/3139295.7 1.Escrow Deposit. (a)Power Provider hereby deposits with Escrow Holder, and Escrow Holder hereby acknowledges receipt of the following previously executed agreements: (i)The Agreement to Terminate and Rescind Certain Agreements Between City of Temecula and SMER RESEARCH 1 Concerning the Santa Margarita Solar Power Generating Facility and Certain Implementing Documents Related Thereto, between the City of Temecula and the Power Provider, with attached Exhibits (collectively "Original Agreements"). (ii)Written consent to the termination of the Original Agreements from all persons who have an interest in the Original Agreements and the solar power generating facility in the SMER being developed by Power Provider, including without limitation, the Consultants Group Commercial Funding Corporation, dba "CG Commercial Finance", as "Lender"(two originals of each consent). (iii)The written approval of a duly authorized representative of SMER that all documents necessary for the termination of the Original Agreements have been received and are in acceptable form (two originals). (b)The City of Temecula hereby deposits with Escrow Holder, and Escrow Holder hereby acknowledges receipt of the following executed agreements: (i)Solar Power Purchase Agreement (Sublease Area 1) between SMER Research 1, LLC and the Southwest Riverside County Energy Authority, duly executed by officers of the SMER Research 1, LLC and the Southwest Riverside County Energy Authority responsible for Sublease Area 1 of the SMER project area. (ii)The City of Temecula’s Guaranty of Power Purchase Agreement attached as Exhibit I to the Solar Power Purchase Agreement (Sublease Area 1) between SMER Research 1, LLC and the Southwest Riverside County Energy Authority, duly executed by the City Manager of the City of Temecula (three originals). (iii)The written approval of the City Manager of the City of Temecula or his designee, that all documents necessary for the termination of the Original Agreements have been received and are in acceptable form (two originals). 2.Release of Agreements from Escrow. Escrow Holder shall hold the Original Agreements and not release same until receipt of the following fully executed documents from the Purchaser or the Cities, as applicable: (a)Solar Power Purchase Agreement (Sublease Area 1)between SMER Research 1, LLC and the Southwest Riverside County Energy Authority, duly executed by officers of the SMER Research 1, LLC and the Southwest Riverside County Energy Authority responsible for Sublease Area 1 of the SMER project area. (b)The City of Temecula’s Guaranty of Power Purchase Agreement attached as Exhibit I to the Solar Power Purchase Agreement (Sublease Area 1) between SMER Research 1, LLC and the Southwest Riverside County Energy Authority, duly executed by the City Manager of the City of Temecula (three originals). (c)Written consent to the termination of the Original Agreements from all persons 3 DOCS 124394-000002/3139295.7 who have an interest in the Original Agreements and the solar power generating facility in the SMER being developed by Power Provider, including without limitation, the Consultants Group Commercial Funding Corporation, dba "CG Commercial Finance", as "Lender" (two originals of each consent). 3.Termination. This Escrow Agreement shall terminate on the release of the Original Agreements and Revised Agreements. 4.Dispute Resolution. If at any time during this escrow any reasonable uncertainty exists, or any dispute arises between the Parties hereto or their respective successors or assigns, as to the release of the Original Agreements and Revised Agreements by Escrow Holder deposited herewith or as to the ownership or right of possession thereof, or as to any matter pertaining to this escrow, Escrow Holder may hold and retain in its possession, without liability, any and all of the Original Agreements and Revised Agreements referred to in this Escrow Agreement until such uncertainty or dispute has been settled. In the event such uncertainty or dispute is not settled within 60 days, Escrow Holder may, at its option, interplead or commence any similar action and deposit the Original Agreements and Revised Agreements with any court having jurisdiction, and thereupon Escrow Holder shall be relieved of all liability with respect thereof; and the undersigned Parties agree to pay all costs in such suit and a reasonable sum as attorneys’ fees. 5.Notices. All notices, requests, consents and other communications hereunder shall be sent to each of the following Parties and be in writing and shall either be: (i) delivered by email (in which case notice shall deemed given when it is received by the recipient), or (ii) personally delivered, or (iii) sent by Federal Express or other overnight or same day courier service providing a return receipt, (and shall be effective when received, when refused or when the same cannot be delivered, as evidenced on the return receipt) to the following addresses: If to Power Provider:SMER Research 1, LLC, c/o 1458 Strabane Way Folsom, CA 95630 Attn: William P. Love, Manager Member With a copy to:Go Green Consultants, LLC c/o 10013 Winkle Circle Elk Grove, CA 95757 Attn: Paul Galindo If to City of Temecula:City of Temecula 41000 Main Street Temecula, CA 92590 Attn: City Manager With a copy to:Richards, W atson & Gershon 355 South Grand Avenue, 49th Floor Los Angeles, CA 90071 Attn: Peter M. Thorson, City Attorney If to SRCEA:Southwest Riverside County Energy Authority c/o City of Lake Elsinore 120 South Main Street Lake Elsinore, CA 92530 Attn: City Manager 4 DOCS 124394-000002/3139295.7 With a Copy to:Leibold McClendon & Mann 9841 Irvine Center Drive, Suite 230 Irvine, CA 92618 Attn: David Mann, City Attorney If to Escrow Holder:Chicago Title Company Attn: Della DuCharme 701 B. Street, Suite 1120 San Diego, CA 92101 Della.ducharme@ctt.com 6.Governing Law; Attorney Fees.This Escrow Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to the State of California' choice of law and conflicts of law rules and decisions, and the terms hereof shall be binding upon and insure to the benefit of the Parties hereto and their respective successors and assigns.In the event any legal proceedings are instituted in connection with the disbursement of the funds held hereunder, the prevailing party shall be entitled to recover from the other party the prevailing party’s costs and expenses in connection therewith, including but not limited to its legal fees and the fees and expenses of Escrow Holder charged pursuant hereto. 7.Costs of Escrow. Escrow Holder shall not be responsible for nor authorized to process any financial demands or pay-off demands that may be requested from Power Provider by a Lender or other interested party as these are the sole obligations of Power Provider. The fees and costs of the Escrow Holder shall be divided equally between the City of Temecula and Power Provider. 8.Waiver and Modification. No waiver or modification by any of the Parties of any of the terms or conditions hereof shall be effective unless in writing and signed by the party or parties making such waiver or modification. 9.Signatures. This Escrow Agreement may be executed in any number of original counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one and the same instrument. The signature pages of any counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon, provided such signature pages are attached to any other counterpart identical thereto except having additional signature pages executed by other parties to this Escrow Agreement attached thereto. Signatures transmitted electronically or via facsimile shall be deemed binding as originals. [SIGNATURE PAGES FOLLOW ] 5 DOCS 124394-000002/3139295.7 IN WITNESS WHEREOF, the Parties have executed this Escrow Agreement as of the date first above written. POWER PROVIDER SMER RESEARCH 1, LLC, a California limited liability company By: Name: William P. Love Title: Managing Member CITY OF TEMECULA CITY OF TEMECULA, a California municipal corporation ___________________________________ Aaron Adams, City Manager ATTEST: _________________________________ Randi Johl, JD, MMC, City Clerk APPROVED AS TO FORM: RICHARDS W ATSON & GERSHON _________________________________ Peter M. Thorson, City Attorney 6 DOCS 124394-000002/3139295.7 SRCEA SOUTHWEST RIVERSIDE COUNTY ENERGY AUTHORITY, a California joint powers authority By: Name: Title: ATTEST: Name: Title: APPROVED AS TO FORM: Name: Title: 7 DOCS 124394-000002/3139295.7 Escrow Holder’s Acceptance THE FOREGOING ESCROW AGREEMENT is accepted by the undersigned with regard to the matters set forth therein. Chicago Title Company By: Name: Title: Date: