PURE CYCLE CORPORATION (NASDAQ:PCYO) Files An 8-K Entry into a Material Definitive Agreement

PURE CYCLE CORPORATION (NASDAQ:PCYO) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01

Entry into a Material Definitive Agreement.
On December15, 2016, Rangeview Metropolitan District, a
quasi-municipal corporation and political subdivision of the
State of Colorado, acting by and through its Water Activity
Enterprise (Rangeview), and Elbert Highway86 Commercial
Metropolitan District, a quasi-municipal corporation and
political subdivision of the State of Colorado, acting by and
through its Water Enterprise (the EH86 District), entered into a
Water Service Agreement (the Water Service Agreement). Subject to
the conditions set forth in the Water Service Agreement and the
terms of the Registrants engagement by Rangeview as Rangeviews
exclusive service provider, the Registrant will acquire, among
other things, the exclusive right to provide water services to
residential and commercial customers in Wild Pointe Ranch,
located in unincorporated Elbert County, Colorado, in exchange
for $1,600,000 in cash. to the terms of the Water Service
Agreement, the Registrant, in its capacity as Rangeviews service
provider, will be responsible for providing water services to all
users of water services within the boundaries and service area of
EH86 District and operating and maintaining the EH86 Districts
water system. In exchange, the Registrant will receive all rates,
fees and charges payable to Rangeview to the Water Service
Agreement, including system development (or tap) fees from new
customers and monthly water service revenues. The EH86 Districts
water system currently provides water service to approximately
120 existing Single Family Equivalent (SFE) (defined below) water
connections in Wild Pointe Ranch and may grow to over 250 SFE
water connections. One SFE is a customer whether residential,
commercial or industrial that imparts a demand on the water
system similar to the demand of a family of four persons living
in a single family house on a standard sized lot. The performance
of the Water Service Agreement by the Registrant, as the
exclusive service provider for Rangeview, was approved by the
board of directors of the Registrant.
The Water Service Agreement may be terminated only upon the
occurrence of certain events of default which remain uncured
(i)after the nondefaulting party has sought to enforce
performance by court action or self-help, and (ii)if following
such efforts and upon 60days advance written notice, the
defaulting party fails to pay monetary damages when due or
refuses to perform its obligations.
The closing of the transactions contemplated by the Water Service
Agreement is subject to customary closing conditions, which the
Registrant will confirm in its capacity as Rangeviews service
provider, including, among others, the appointment of two
individuals designated by Rangeview as directors of the EH86
District, the adoption by the EH86 District of the rules and
regulations of Rangeview, subject to such modifications as are
approved by Rangeview, Rangeviews completion to its satisfaction
of due diligence regarding title to the water rights used to
serve Wild Pointe Ranch, the accuracy of the representations and
warranties made by each party contained in the Water Service
Agreement, and each partys compliance with its covenants and
agreements contained in the Water Service Agreement. The closing
of the transactions contemplated by the Water Service Agreement
must take place no later than February23, 2017, or on the second
business day following the satisfaction or waiver of all
conditions to the obligations of the parties related thereto.
The foregoing description of the Water Service Agreement is
qualified in its entirety by the terms of the agreement, a copy
of which is attached hereto as Exhibit10.1 and is incorporated
herein by reference.
On December19, 2016, the Registrant issued a press release
relating to the Water Service Agreement. A copy of the press
release is attached hereto as Exhibit99.1.
Item 9.01
Financial Statements and Exhibits.
(d)Exhibits.
Exhibit No.
Description
10.1
Water Service Agreement by and between Rangeview
Metropolitan District, acting by and through its Water
Activity Enterprise, and Elbert Highway86 Commercial
Metropolitan District, acting by and through its Water
Enterprise, dated as of December15, 2016.
99.1
Text of press release by Pure Cycle Corporation, dated
December19, 2016.


About PURE CYCLE CORPORATION (NASDAQ:PCYO)

Pure Cycle Corporation is an integrated water company that provides wholesale water and wastewater services. The Company provides its services to wholesale customers, which include industrial customers and local governmental entities that provide water and wastewater services to their end-use customers located in the Denver, Colorado metropolitan area. The Company is engaged in selling water service to customers, using water rights owned or controlled by the Company and developing infrastructure to divert, treat and distribute that water and collect, treat and reuse wastewater. The Company owns a portfolio of water rights located in the Denver, Colorado metropolitan area, Southeastern Colorado in the Arkansas River, and the Western Slope of Colorado in the Colorado River. The Company’s Denver area assets include Rangeview Water, the Lowry Range Property, Sky Ranch and Arapahoe County Fairgrounds.

PURE CYCLE CORPORATION (NASDAQ:PCYO) Recent Trading Information

PURE CYCLE CORPORATION (NASDAQ:PCYO) closed its last trading session up +0.25 at 5.45 with 32,596 shares trading hands.

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