Loading...
03-08-2011 LETTER FROM SHERMAN RE SPECIAL COUNSEL- Buffalo RidgeSherman & Howard L.L.C. Dee P. Wisor Direct Dial Number: (303) 299 -8228 E -mail: dwisor @sah.com Town of Avon and Buffalo Ridge Affordable Housing Corporation Attn: Larry Brooks 400 Benchmark Road Avon, CO 81620 Dear Larry: ATTORNEYS & COUNSELORS AT LAW 633 SEVENTEENTH STREET, SUITE 3000 DENVER, COLORADO 80202 TELEPHONE: (303) 297 -2900 FAX: (303) 298 -0940 WW W.SHERMANHOWARD.COM March 8, 2011 We are pleased to confirm our engagement as special counsel to the Town of Avon (the "Town ") and Buffalo Ridge Affordable Housing Corporation (the "Corporation ") in connection with the amendment of documents and other transactions related to the Corporation's Multifamily Housing Project Revenue Bonds (GNMA Mortgage- Backed Securities Program — Buffalo Ridge I Apartments Project), Series 2002 (the "Bonds ") including the sale of the GNMA Mortgage Backed Securities which secure the payment of the Bonds and the issuance of tax - exempt subordinate debt (the "Transactions "). We appreciate your confidence in us and will do our best to continue to merit it. This letter sets forth the role we propose to serve and the responsibilities we propose to assume in advising the Town and the Corporation in connection with the Transactions. Personnel. Dee Wisor will be principally responsible for the work performed by Sherman & Howard L.L.C. in connection with this engagement and he will report to and take direction from you, in your capacity as Town Manager and as a member of the Board of Directors of the Corporation. Where appropriate, certain tasks may be performed by other attorneys or paralegals. At all times, however, Dee Wisor will coordinate, review, and approve all work completed for the Town and the Corporation. Scope of Services. In connection with the Transactions, it will be our responsibility to review, on behalf of the Town and the Corporation, the Transaction documents, records and instruments, and applicable law. We will consult with you concerning the Town's and Corporation's responsibilities and obligations in connection with the Transactions. In representing the Town and the Corporation in this matter, our services may include research, phone consultations, meetings, and preparation of memoranda. Our services do not include attending any hearings or conducting litigation. Our services as special counsel are limited to those contracted for explicitly herein; and your execution of this letter constitutes an acknowledgment of those limitations. Attorney- Client Relationship. In performing our services as special counsel, the Town and the Corporation will both be our clients. We will represent the interests of the Town and the Corporation, respectively, rather than the Town Council or the Corporation's Board of Directors, the Council's or Board's individual members, or the Town's or Corporation's employees. 001024.054/1372384.2 Town of Avon and Buffalo Ridge Affordable Housing Corporation Sherman & Howard L.L.C. March 8, 2011 Page 2 As a joint representation, both the Town and the Corporation should feel free to communicate directly with us at any time. In general, information learned by lawyers about their clients and communications between lawyers and their clients are privileged and confidential and may not be disclosed to third parties without the client's consent. Because the Town and the Corporation will both be our clients in this matter, information we learn about the Town and the Corporation and confidential communications between us and the Town and the Corporation will be privileged and confidential and may not be disclosed to third persons. However, as your lawyers we may be ethically required to disclose to the Town or the Corporation any information or any problem concerning either the Town or the Corporation which is disclosed to us or which we discover in the course of our work for you. At this time, the interests of the Town and the Corporation are generally aligned and neither you nor we perceive any conflicting or differing interests between the Town and the Corporation concerning the very limited scope of our engagement. With respect to certain, specific terms of the financing documents, it is our understanding that Kutak Rock will represent the interests of the Town and the interests of the Corporation. If during the course of this representation we perceive any conflicting or differing interests between the Town and the Corporation, we will advise both the Town and the Corporation of that fact at once. Similarly, the Town and the Corporation will advise us at once if you come across differing or conflicting interests of which we are not aware, now or later during the course of the representation. In that event, we may not participate in the resolution of any such conflict between the Town and the Corporation; rather the Town and the Corporation will attempt to resolve their differences between themselves in such manner as you determine to be proper. In the event the Town and the Corporation are unable to resolve such differences, it may be necessary for our firm to withdraw from the representation of one or both clients, depending on the circumstances. Conflicts of Interest. Our firm sometimes represents, in other unrelated transactions, certain of the financial institutions that may be involved in this Transaction, such as underwriters, credit enhancers, and banks. Sherman & Howard also represents various East West affiliates for East West and other businesses and individuals who conduct business in Eagle County. From time to time these representations have been, and will be, adverse to the Town. These matters include land use applications, the negotiation and administration of development agreements and other agreements and instruments with the Town, the formation and administration of metropolitan districts within the Town, dealings with the Avon Urban Renewal Authority, real estate or other contractual transactions between the Town and a Sherman & Howard client, advice and communications regarding Town ordinances, Town administrative proceedings, construction - related matters, including code violations and interpretations, and similar matters customary in the representation of real estate developers in the Town. Our representation of East West includes the Riverfront Village PUD and its ongoing development of this master project. We anticipate that in the future the firm will be engaged by existing and new clients for representation in similar types of matters that are adverse to the Town. We do not believe that any of these representations will materially limit or adversely affect our ability to represent the Town and the Corporation in connection with this financing, even though such representations may be characterized as adverse under the Colorado Rules of Professional Conduct (the "Rules "). Accordingly, pursuant to Rule 1.7 of the Rules, we do ask that you consent to our representation of such parties in transactions that do not directly or indirectly involve the Transactions. Your execution of this letter will signify the Town's and the Corporation's current and 001024.054/1372384.2 Sherman & Howard L.L.C. Town of Avon and Buffalo Ridge Affordable Housing Corporation March 8, 2011 Page 3 prospective consent to the above - described adverse representations in matters unrelated to the Transactions while we are serving as counsel hereunder. This paragraph shall not restrict the right of the Town in the future to rescind the Town's waiver of conflict of interest and consent to representation of East West affiliates by Sherman & Howard which is adverse to the Town. Fee Arrangement. Based upon: (i) our current understanding of the terms, structure, size and schedule of the Transactions, (ii) the responsibilities we will undertake pursuant to this letter, (iii) the time we anticipate devoting to the Transactions, and (iv) the skill and experience required to complete the services properly, we estimate that our fee will be in the range of $15,000 to $25,000. Such fee may vary: (i) if material changes in the structure of the Transactions occur, or (ii) if unusual or unforeseen circumstances arise which require a significant increase in our time or our responsibilities. Specifically, if the Transactions are not closed on or before May 1, 2011, it will be necessary for us to repeat and update much of our work and a commensurate increase in our fees will result. If, at any time, we believe that circumstances require an adjustment of our original fee estimate, we will consult with you. In addition, this letter authorizes us to make disbursements on behalf of the Town and the Corporation. We will bill for such expenses at cost, including such items as photocopying, facsimile transmission charges, computer assisted research, deliveries and other miscellaneous expenses. We will submit a fee statement at the conclusion of our representation of the Town and the Corporation. If the Transactions are not closed, we will expect to be compensated for our work based upon the time we spend fulfilling our duties as special counsel to the Town. Dee Wisor's hourly rate is $490. It is possible that other attorneys and legal assistants will assist in certain aspects of our representation at a lower hourly rate. Our hourly rates are increased periodically, generally at year end. If the firm increases rates during this engagement, we will provide you written notice of those changes for the personnel working on this engagement and we will charge at the adjusted rates for work performed after the change. Such changes will be reflected on our invoices. Sherman & Howard acknowledges and agrees that all fees shall be paid by the Corporation regardless of whether the transaction closes, and that the Town shall not be liable for the payment of fees. Document Retention. At or within a reasonable period after the conclusion of our representation hereunder, we will review the file to determine what materials should be retained as a record of our representation and those that are no longer needed. We will return any original documents obtained from you. We will retain for several years a copy of such materials as correspondence, final substantive work product, documents obtained from you, and documents obtained from third parties. We will not retain such materials as duplicates of the above - described material, or drafts and notes that do not appear needed any longer. Ordinarily the firm will keep the retained materials until seven years after the conclusion of our representation. At the end of that time, Sherman & Howard will notify the Town and the Town's attorney in writing that the firm desires to destroy the bulk of the file and shall offer to the Town the ability to deliver or permit retrieval of such materials prior to destruction by the firm. If the file is especially voluminous, we may destroy all or portions of it earlier, as our storage 001024.054/1372384.2 Sherman & Howard L.L.C. Town of Avon and Buffalo Ridge Affordable Housing Corporation March 8, 2011 Page 4 facilities are limited, provided that prior to such destruction, Sherman & Howard will notify the Town and the Town's attorney in writing that the firm desires to destroy portions of the file and shall offer to the Town the ability to deliver or permit retrieval of such materials prior to destruction by the firm. If you prefer other arrangements for retention or disposition of our files in this matter, please advise us in writing. Termination of Engagement. Upon completion of our services as outlined in this letter, our responsibilities as special counsel will terminate and our representation of the Town and the Corporation and the attorney- client relationship created by this engagement letter will be concluded. Should the Town or the Corporation seek other, additional legal services, we would be happy to discuss the nature and extent of our separate engagement at that time. Approval. If the foregoing terms of this engagement are acceptable to you, please so indicate by returning the duplicate original of this letter signed by you, retaining the other original for your files. We are pleased to have the opportunity to serve as your special counsel and look forward to a mutually satisfactory and beneficial relationship. If at any time you have questions concerning our work or our fees, we hope that you will contact us immediately. SHERMAN & HOWARD L.L.C. By: Accepted and Approved: TOWN OF AVON, COLORADO By: Title: Date: 1 I BUFFALO RIDGE AFFORDABLE HOUSING CORPORATION Title: Date: DPW /jw Enclosures cc: Eric Heil, Esq. 001024.054/1372384.2