COHFALogo

PRELIMINARY AGREEMENT

This PRELIMINARY AGREEMENT is effective between the COLORADO HEALTH FACILITIES AUTHORITY (COHFA) and herein referred to as APPLICANT.

COHFA and APPLICANT intend to undertake a financing in the amount of approximately $________
under the Colorado Health Facilities Authority Act; and further, desire to set forth responsibilities of each party and liability for expenses associated with the financing.

THEREFORE, it is agreed as follows:

1. COHFA will:  a) use reasonable efforts to arrange financing in a timely fashion, on terms and conditions acceptable to APPLICANT; b) engage, after consultation with APPLICANT when appropriate, such advisors, consultants and other providers of necessary services as may be appropriate to the financing; c) cooperate with APPLICANT to minimize costs of the financing; d) immediately cease preparation of the financing and notify its advisors and consultants to do the same upon receipt of a written request to this effect from APPLICANT.

2. APPLICANT will:  a) furnish as appropriate and in timely fashion evidence of all necessary governmental approvals, opinions of counsel, documents, certificates and other information as may be requested by COHFA or its advisors, consultants, and counsel; b) ensure timely payment of all fees and costs chargeable to APPLICANT, including but not limited to the following:

i) fees and expenses of a financial feasibility study (if required by COHFA); fees and expenses of consultants, advisors and attorneys, whether retained by COHFA or by APPLICANT (other than the fees and expenses of COHFA’s General Counsel and Financial Advisor), fees of the Trustee, fees and expenses of bond counsel and the underwriter/placement agent, printing costs, and any other expenses related to the financing.

ii) COHFA's fees as provided in Paragraph 3 below.

iii) Annual Trustee fees.

3. The fees payable by APPLICANT to COHFA will consist of an Initial Planning Service Fee (Initial Fee), payable in two installments, and an Annual Service Fee (Annual Fee) payable in periodic installments after the financing is closed.

a) Initial Fee

The Initial Fee paid to COHFA is payment for the services of COHFA's General Counsel, Financial Advisor retained by COHFA, and COHFA's general costs and expenses. All other costs related to the Financing are payable by APPLICANT in addition to the Initial Fee.

T he total Initial Fee for a financing in the amount of $________ will be $________             

The first installment of the Initial Fee shall be 20% of the total Initial Fee, and is due and payable with the Application for Financing and is non-refundable.

The second and final installment of the Initial Fee shall be 80% of the total Initial Fee, and is due and payable at the closing of the financing.

If APPLICANT decides at any time to abandon the financing for any reason, APPLICANT shall be obligated to pay to COHFA, in addition to the first installment of the Initial Fee, a sum equal to all out-of-pocket costs incurred by COHFA which relate at any time to the financing, including but not limited to the fees and expenses of advisors, consultants and attorneys, provided that such amount shall not exceed the balance due on the Initial Fee. Such out-of-pocket costs shall accrue through the date on which APPLICANT delivers to COHFA, in writing, its intention to abandon the financing.

b) Annual Fee

An Annual Fee is payable to COHFA, based upon the outstanding principal balance on the day before each anniversary date of the bonds or notes. The Annual Fee is due and payable quarterly, in arrears, following the date of the bonds or notes. The Annual Fee shall be computed at the current annual rate as adjusted from time to time by COHFA by written notice to Applicant.

4. Pending the execution of other financing documents among the parties to the financing, COHFA and APPLICANT each retain the complete prerogative at any time to elect by written notice not to further proceed with the financing, in which event there shall be no further or continuing obligation on the part of COHFA or APPLICANT, except that the obligations owed by APPLICANT to COHFA under Paragraph 3 shall survive any termination of the financing process.

5. This AGREEMENT shall not be deemed to constitute in any way a determination by COHFA that the financing is feasible or will in fact be accomplished. COHFA does not promise nor guarantee approval of the Application for Financing or a successful financing, or in any way represent that funds for the financing are or will become available.

6. APPLICANT acknowledges that: a) COHFA, an independent public body politic and corporate, constituting a public instrumentality, is a political subdivision of the State of Colorado and therefore is subject to the Colorado Open Records Act; b) all records of COHFA, including any and all information supplied to COHFA by APPLICANT at any time, are open for inspection by any person (including corporations) at reasonable times, except as otherwise specifically provided by law. In the event COHFA receives a request for inspection of any of its records relating to APPLICANT, COHFA will notify APPLICANT of such request and will inform APPLICANT of its response to such request in accordance with its Policy on Release of Information from COHFA files. COHFA shall have no liability or responsibility of any nature to APPLICANT with respect to any response to a request for inspection of COHFA's records.

AUTHORITY: COLORADO HEALTH FACILITIES AUTHORITY

BY:

APPLICANT:                                   
                                               
BY: