MEMORANDUM OF AGREEMENT

This Memorandum of Agreement is entered into this ___ day of August, 2014, by
and between:
PHOENIX WATER RESOURCES, LLC a limited liability
company licensed to do and doing business in the State of
Alabama, represented herein by _____________, its _______, duly
authorized (Phoenix);
AND
CITY OF IRONDALE, ALABAMA, a municipality of the State
of Alabama (the City), represented herein by Tommy Joe
Alexander, its Mayor, duly authorized by all appropriate and
required action of the City Council of the City;
(hereinafter sometimes referred to collectively as the Parties)
each of whom make the following declarations:
Phoenix and the City enter into this Memorandum of Agreement (the
Memorandum) for the purposes and on the terms and conditions set forth in this
Agreement.
PRELIMINARY RECITALS
WHEREAS, Phoenix operates a private sewer utility and provides sewer
services and facilities to its customers in the City through a franchise agreement
by and between the City and Phoenix;
WHEREAS, Phoenix has entered into an Agreement, dated July 10, 2014, with
Presbyterian Retirement Homes of Birmingham, Inc. d/b/a Kirkwood by the River
(Kirkwood) to connect Phoenixs sewer facilities to Kirkwoods facility
located in the City in accordance with the terms and conditions of said Agreement
(Agreement);
WHEREAS, the City and Phoenix have agreed to a method to finance the
expansion, installation and construction by Phoenix of the infrastructure/sewer
facilities in order to connect the Kirkwood facility to the Phoenix sewer facilities
(Project);
WHEREAS, for and in consideration of Phoenix and the City continuing to
work towards economic projects in the City for the mutual benefit of the Parties,
the Parties desire to enter into this Memorandum for the purpose of financing
the Project by the City borrowing and providing to Phoenix $700,000.00 for

Phoenixs use as described herein, payable in twenty-three equal consecutive

monthly installments of interest only with a final twenty-fourth installment of
$700,000 from a mutually acceptable private bank (Loan). Phoenix agrees to
timely pay to the City all twenty-four monthly installments due under the Loan;
WHEREAS, Phoenix has agreed to secure/guarantee the payment of all twentyfour monthly installments due under the Loan through an irrevocable standby
letter of credit acceptable to the City in its sole discretion or other acceptable
security as determined by the City in its sole discretion;
WHEREAS, the City declares that the terms as described hereinabove are in the
best interest of the City and will serve the public interest;
NOW, THEREFORE, the Parties, for good and valuable consideration, and in
consideration of the mutual covenants and benefits hereinafter set forth, agree as follows:
ARTICLE 1
PRELIMINARY RECITALS
The foregoing Preliminary Recitals are incorporated herein by reference and form
an integral part of this Agreement.
ARTICLE 2
COOPERATIVE ENDEAVOR AGREEMENT
2.1 Cooperative Endeavor. Amendment No. 772 of the Alabama Constitution
of 1901, as amended (the Constitution), provides that, for a valid and sufficient public
purpose, a municipality may grant public funds and things of value in aid of or to any
corporation, public or private, for the purpose of promoting the economic and industrial
development of the municipality. The Parties desire to enter into this Memorandum as
a cooperative endeavor under the Constitution for the purpose of promoting the economic
and industrial development of the City for the mutual benefit of the Parties. The
expansion, development and continued operation of the Phoenix sewer facilities
constitutes a public purpose for the expenditure of public funds.
2.2 Agreement. In consideration of the mutual benefits hereby conferred and
other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Parties hereto hereby enter into a cooperative endeavor.
2.3 Term. This Memorandum shall commence as of __________ __, 2014, and
shall, unless extended by the Parties, terminate as of the date stated in Section 5.9 below
unless terminated earlier as provided herein.

ARTICLE 3
OBLIGATIONS OF THE PARTIES
3.1 The Method of Operation. The City shall borrow and provide to Phoenix
$700,000.00 for Phoenixs use as described herein, payable in twenty-three equal
consecutive monthly installments of interest only with a final twenty-fourth installment
of $700,000 from a private bank and upon the terms acceptable to the City in its sole
discretion (Loan). Phoenix agrees to timely pay to the City all twenty-four monthly
installments due under the Loan. Phoenix shall secure/guarantee the payment of all
twenty-four monthly installments due under the Loan through an irrevocable standby
letter of credit acceptable to the City in its sole discretion and/or other acceptable security
as determined by the City in its sole discretion. Phoenix shall use the net proceeds of
the Loan to install, construct and substantially complete the infrastructure required to
connect the Phoenix sewer facilities to the Kirkwood facility during the term of the
Loan.
3.2 Limitation of Liability. The City shall not be liable to Phoenix for any
commercial loss, inconvenience, loss of use, time, data, good will, revenues, profits or
savings; or other special, indirect, consequential or incidental damages which, in any
manner directly or indirectly, is connected with or arises out of the agreements or
obligations of Phoenix contemplated by this Memorandum, or is connected with or
arises out of any of the obligations of the City, or arises out of the failure of the City to
perform any of the obligations made by and imposed under this Memorandum,
regardless of whether such special, indirect, consequential or incidental damage is
contended, or ultimately shown or held to be caused, in whole or in part, by the acts or
omissions of the City. This limitation of liability shall survive the expiration or
termination of this Memorandum.
ARTICLE 4
DEFAULT
4.1
Remedies. If any party to this Memorandum should fail or refuse to
perform any agreement on its part herein contained, the other party shall give written
notice to the defaulting party of the specific facts which constitute a default. The
defaulting party shall have the right to cure the default within a reasonable time60 Days
after receipt of notice. If the default is not timely cured, the other party shall have the
right (1) to seek specific performance of the defaulting partys obligation in accordance
with this Memorandum; or, (2) if Phoenix is the defaulting party by reason of nonpayment or otherwise, the City may accelerate the payment of the Loan and draw on the
irrevocable standby letter of credit or other security/guaranty posted by Phoenix to pay to
the City the entire balance due for principal and interest on the Loan as of the date of the
default. In no event shall the City become liable for any loss or damage of any nature
whatsoever that may be incurred by Phoenix.

4.2
Attorney Fees. In the event of any judicial action by the City by reason
of any breach of this Memorandum by Phoenix or to enforce or interpret any of the
covenants, terms, or conditions hereof, the City, if it is the prevailing party, shall be
entitled to recover from Phoenix as costs its reasonable attorneys' fees, the amount of
which shall be fixed by the court and shall be made a part of any judgment or decree
rendered.
ARTICLE 5
MISCELLANEOUS
5.1.
Amendment, Modification, and Non-Waiver.
No amendment,
modifications, or changes to this Memorandum shall be binding upon either party hereto
unless set forth in a writing executed by a duly authorized officer or agent. No waiver by
any party of any breach or default of any term, condition, or provision hereof shall be
deemed a waiver of any other or subsequent breaches or defaults of any kind, character,
or description under any circumstance. No waiver of any breach or default of any term,
condition, provision hereof shall be implied from any action of either party and any such
waiver, to be effective, shall be set out in a written instrument signed by the waiving
party.
5.2. Governing Law and Venue. This Memorandum shall be construed and
enforced in accordance with the laws of the State of Alabama. Each party agrees that the
exclusive venue and forum to enforce any and all aspects of this Memorandum shall be
the Circuit Court for the County of Jefferson, Alabama.
5.3. Number and Gender; Captions; References. Pronouns, wherever used
herein, and of whatever gender, shall include natural persons and corporations and
associations of every kind and character, and the singular shall include the plural
wherever and as often as may be appropriate. Article and section headings in this
Memorandum are for convenience of reference and shall not affect the construction or
interpretation of this Memorandum. Whenever the terms hereof, hereby, herein,
or words of similar import are used in this Memorandum, they shall be construed as
referring to this Memorandum in its entirety rather than to a particular section or
provision, unless the context specifically indicates to the contrary. Any reference to a
particular Article or Section shall be construed as referring to the indicated article or
section of this Memorandum.
5.4. Severability. If any provision of this Memorandum or the application
thereof to any person or circumstance shall, at any time or to any extent, be invalid or
unenforceable, and the basis of the bargain between the parties hereto is not destroyed or
rendered ineffective thereby, the remainder of this Memorandum, or the application of
such provision to persons or circumstances other than those as to which it is held invalid
or unenforceable, shall not be affected thereby.
5.5. Regulations and Termination. The Parties acknowledge that this
Memorandum may be required to be filed with certain regulatory agencies and is subject
to agency or departmental oversight. In the event either party is adversely affected by

regulatory or agency or departmental changes or modifications, such party shall have the
right to negotiate for the necessary relief to alleviate said adverse effects brought on by
either changes or modifications as imposed. If the party is unable to obtain the necessary
relief after a reasonable period of negotiation, the affected party shall have the right to
terminate this Memorandum. In the event this Memorandum is terminated pursuant to
the provisions of this Section 5.5 or for any other reason, Phoenix shall immediately pay
to the City the outstanding principal and interest due under the Loan as of the date of the
termination of this Memorandum.
5.6. Successors and Assigns. This Memorandum shall be binding upon and
inure to the benefit of the Parties hereto and their respective successors and assigns.
Whenever a reference is made herein to either party, such reference shall include the
partys successors and assigns, if any. No party hereto may assign its rights under this
Memorandum to any other person or entity without the prior written consent of the other
party hereto.
5.7. Survival. Any terms and provisions of this Memorandum pertaining to
rights and/or remedies of the Parties shall survive the end of the Term of this
Memorandum.
5.8. Notices. Any notice or demand required or permitted under this
Memorandum (Notice) must be in writing and will be deemed to have been given
when personally delivered, sent by facsimile with receipt acknowledged, deposited with
any nationally recognized overnight carrier that routinely issues receipts, or deposited in
any depository regularly maintained by the United States Postal Service, postage prepaid,
certified mail, return receipt requested, addressed to the party for whom it is intended at
the addresses set forth below. Any party to this Memorandum may add additional
addresses or change its addresses for purposes of receipt of any such communication by
giving ten (10) days prior written notice of such change to the other parties in the manner
prescribed in this Section.
to the City:

Hon. Tommy Joe Alexander

101 20th Street South
Irondale, Alabama 35210

to Phoenix:
5.9 Termination. This Memorandum shall be terminated at the earlier to occur
of: (a) mutual agreement and consent of the Parties, or (b) after payment in full of the
Loan by Phoenix.

This Memorandum has been signed by Phoenix Water Resources, LLC in

Birmingham, Alabama, on the ___ day of ___________, 2014, in the presence of the
undersigned witnesses.
WITNESSES:

PHOENIX WATER
RESOURCES, LLC

_____________________________

By:___________________________
,its

_____________________________

This Memorandum has been signed by the City in Irondale, Alabama, on the ___
day of _____________, 2014, in the presence of the undersigned witnesses.
WITNESSES:

CITY OF IRONDALE,
ALABAMA

_____________________________

By:___________________________
TOMMY JOE ALEXANDER
Mayor

_____________________________