HomeMy WebLinkAboutContract 58238 Receive Date: 10/14/2022
Receive Time: 4:50pm City Contract Number: 58238
ESCROW AGREEMENT TO REPLACE COMPLETION AGREEMENT
THIS ESCROW AGREEMENT("Agreement"),is made an entered into by and between the City
of Fort Worth,a home-rule municipal corporation of the State of Texas("City"),FG Aledo Development,
LLC, ("Developer"), and Simmons Bank("Escrow Agent").
WHEREAS,City and Developer entered into a Community Facilities Agreement for Morningstar
Section 10, Phase 1 (CFA# 22-0006, City Project Number 103488) for the construction of public
infrastructure improvements ("CFA"); and
WHEREAS, the CFA provides that Developer shall submit to the City performance bonds, cash
deposits, or other financial security acceptable to the City (collectively, the "Financial Security") for the
purpose of guaranteeing satisfactory compliance by Developer with all requirements,terms, and conditions
of the CFA ("CFA Obligations"); and
WHEREAS, City, Developer, and Escrow Agent executed a Completion Agreement as the
financial security guaranteeing satisfactory compliance with the CFA Obligations; and
WHEREAS, the CFA and the Completion Agreement are filed with the City Secretary as City
Secretary Contract Number 57128; and
WHEREAS,Developer desires to replace the Completion Agreement with this Agreement in order
to guarantee satisfactory compliance with the remaining CFA Obligations;and
WHEREAS, City staff have determined that the amount of this Escrow Agreement is adequate
financial security to guarantee satisfactory compliance by Developer with the remaining CFA Obligations;
and
WHEREAS,City and Developer desire and agree that Developer be allowed to escrow and pledge
cash deposits to City, to be held by Escrow Agent, as an escrow agent, in complete satisfaction of the
obligation to submit the Financial Security to secure the performance of the remaining CFA Obligations.
NOW THEREFORE, for and in consideration of these recitals, ten dollars ($10.00) and other
good and valuable consideration,the receipt, sufficiency and adequacy of which are hereby acknowledged,
the parties hereto hereby agree as follows:
SECTION 1. DEFINED TERMS.
For the purposes of this Agreement, unless the context otherwise clearly requires, the following
terms shall have the following meanings:
"Security Funds" shall mean the cash deposit of Twenty-Six Thousand Four Hundred Thirty
Two and 501100 Dollars ($26,432.50),which sum represents one hundred twenty-five percent
OFFICIAL RECORD
City of Fort Worth,Texas CITY SECRETARY
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19 FT.WORTH, TX
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(125%) of the estimated Developer's cost of constructing the remaining CFA Obligations
("Estimated Developer's Cost").
"Lien" shall mean any lien, security interest, charge, tax lien, pledge or encumbrance designed to
secure the repayment of indebtedness or the satisfaction of any other obligation to a third party not
a party of this Agreement.
SECTION 2. SECURITY FUNDS.
As financial security for the full and punctual performance of the remaining CFA Obligations,
Developer hereby pledges,assigns, and transfers to City, and hereby grants to City a security interest in the
Security Funds and all rights and privileges pertaining thereto with the exception of the interest income to
be derived therefrom(which interest income shall remain the property of Developer and shall be distributed
by Escrow Agent in accordance with Developer's periodic instructions) subject, however, to the terms,
covenants, and conditions hereinafter set forth. The security interest granted and the assignments made
hereunder are made as security only and shall not subject the City or Escrow Agent to,or transfer or in any
way affect or modify, any obligation of Developer with respect to the CFA Obligations or any transaction
involving or giving rise therefrom.
SECTION 3. PHYSICAL POSSESSION OF SECURITY FUNDS.
Concurrently with the execution of this Agreement, Developer shall have delivered to and
deposited with Escrow Agent the Security Funds. The parties acknowledge and agree that Escrow Agent
shall be required to segregate the Security Funds from other funds held by Escrow Agent for Developer in
accordance with the normal practices of Escrow Agent acting as an escrow agent.Escrow Agent shall return
all funds on deposit representing or evidencing the Security Funds remaining in its possession to Developer
(or take such other action as Developer may request or direct)within two(2)business days after receipt of
written notice from City that the CFA Obligations have been fully performed. During such time as Escrow
Agent has possession of the Security Funds,Escrow Agent shall furnish to the City,when requested by the
City, written acknowledgments signed by an officer of Escrow Agent detailing the amount of the Security
Funds.City's rights in the Security Funds shall be superior to those of Escrow Agent's notwithstanding any
terms or understandings,written or otherwise,between Developer and Escrow Agent.
SECTION 4. COVENANTS.
(a) Affirmative Covenants. So long as any of the remaining CFA Obligations are unperformed,
Developer covenants and agrees that Developer will:
(i) from time to time execute and deliver to City all such assignments, certificates,
supplemental writings, and other items and do all other acts or things as City may
reasonably request in order to evidence and perfect the security interest of City in the
Security Funds;
(ii) furnish City with information which City may reasonably request concerning the Security
Funds;
(iii) notify City of any claim,action,or proceeding affecting title to the Security Funds or City's
security interest(s)therein;and
City of Fort Worth,Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
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(iv) adjust the Security Funds to an amount equal to the actual contract price, including
revisions thereto, if the original Security Funds were based on an engineer's estimate of
costs.
(b) Negative Covenants. So long as any of the CFA Obligations remain unperformed, Developer
covenants and agrees that Developer will not:
(i) assign or transfer any rights of Developer in the Security Funds;or
(ii) create any Lien in the Security Funds, or any part thereof, or permit the same to be or
become subject to any Lien except the security interest herein created in favor of the City.
SECTION 5. EVENTS OF DEFAULT.
Developer shall be in default under this Agreement only upon the happening of any of the following
events ("Default"):
(a) default in the timely payment for or performance of the CFA Obligations after written notice thereof
has been given to Developer and Escrow Agent and such default is not cured within seven(7)days
after such notice; or
(b) any affirmative covenant or negative covenant is breached by Developer.
SECTION 6. RIGHTS AND REMEDIES OF FORT WORTH UPON AND AFTER DEFAULT.
(a) Remedy. Upon the occurrence of a Default, City shall have the right to direct Escrow Agent to
transfer to City all of the Security Funds.Escrow Agent is hereby authorized to transfer the Security
Funds within two(2)business days upon the receipt of a written statement purporting to be executed
by an authorized representative of City stating that:
(i) a Default by Developer has occurred related to the remaining CFA Obligations;
(ii) written notice of such Default has been given by City to Developer and Escrow Agent and
such Default was not cured within seven(7)days after delivery of such notice;and
(iii) City is entitled to have the Security Funds transferred in accordance with the Agreement.
(b) Notices.Any notice required or permitted to be given to any party hereto shall be given in writing,
shall be personally delivered or mailed by prepaid certified or registered mail to such party at the
address set forth below, and shall be effective when actually received.
To: City With a copy to:
City of Fort Worth City of Fort Worth
Atlas: City Treasurer Atlas: CFA Administration
200 Texas Street 200 Texas Street
Fort Worth, TX 76102 Fort Worth,TX 76102
City of Fort Worth,Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
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To Developer: To: Escrow Agent:
FG Aledo Development, LLC Simmons Bank, an Arkansas state bank
Attention: Kim Gill Attention: Amy Stoermer
3045 Lackland Rd. 2200 West 7t` Street
Fort Worth, Texas 76116 Fort Worth, TX 76102
Any party may change its address for notice by giving all other parties hereto notice to such change
in the manner set forth in this Section no later than ten (10) days before the effective date of such new
address.
SECTION 7. EXCLUSIVE RIGHTS AND REMEDIES.
If the Developer fails to perform its obligations under the CFA, the City's sole and exclusive
remedy shall be to complete the obligations of Developer at Developer' expense. In furtherance of such
sole and exclusive remedy, City is entitled to exercise its rights as set forth in Section 6 hereof.
SECTION 8. SUBSTITUTION OF COLLATERAL.
Notwithstanding any contrary provision in this Agreement, Developer shall have the right, at any
time and from time to time,to obtain releases of all or any part of the Security Funds(hereinafter called the
"Released Collateral")upon satisfaction of the following conditions:
(a) Developer shall provide City and Escrow Agent written notice ("Substitution Notice") that the
Developer desires to obtain Released Collateral in exchange for a contemporaneous substitution of
an alternate Financial Security acceptable to City (as specified and described in the Substitution
Notice);
(b) Developer shall pledge to, or obtain for the benefit of City, and deliver to City the alternate
Financial Security acceptable to City ("Substituted Collateral") which Substituted Collateral shall
in the aggregate be at least equal to the Estimated Developer's Cost; and
(c) said Substituted Collateral shall be of sufficient amounts to cover all work which has occurred prior
to the substitution of collateral provided for in this Section.
Upon satisfaction of the above-specified conditions,Escrow Agent shall be authorized(without the
further consent of City) to return to Developer the original Security Funds in Escrow Agent's possession
that represent or evidence the Released Collateral or take such other action with respect to the Released
Collateral as Developer may request or direct. Developer shall pay the expenses incurred by Escrow Agent
in connection with obtaining each such release and substitution.
SECTION 9. REDUCTIONS IN SECURITY FUNDS.
(a) Notwithstanding any contrary provision in this Agreement, Developer shall have the right
to reductions in the Security Funds (hereinafter called a "Reduction in the Security
Funds"),in accordance with this Section 9.
(b) Every thirty (30) days, Developer may request a reduction in the Security Funds in
accordance with Section 9-310-1 of the CFA Ordinance.
City of Fort Worth,Texas
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(c) Developer shall provide the City of Fort Worth and Escrow Agent with written notice (the
"Withdrawal Notice") that Developer desires to obtain a Reduction in the Security Funds
in any amount less than or equal to the then-completed CFA Obligations as inspected or
accepted by Fort Worth.
(d) A Reduction in the Security Funds may only be made after:
i. The City's inspectors have verified the amount of the Community Facilities that
have been constructed in accordance with the engineering plans; and
ii. The City has received an affidavit and release of lien executed by the contractor
indicating that the contractor has been paid by Developer and the contractor has
paid all subcontractors and material suppliers for the Community Facilities that
have been constructed pursuant to the CFA.
(e) After the City has confirmed the amount of the Community Facilities that have been
constructed in accordance with the engineering plans and the City has received an affidavit
and release of lien from the contractor for the Community Facilities that have been
constructed,then the Security Funds may be reduced to an amount that is no less than one
hundred twenty-five percent (125%) of the value of the Community Facilities that are
remaining to be constructed.
SECTION 10. NON-ASSIGNABILITY OF CITY'S RIGHTS.
The rights, powers, and interests held by City hereunder in and to the Security Funds may not be
transferred or assigned by City in whole or in part.Any attempted transfer or assignment shall be absolutely
void and shall entitle Developer to a release of all Security Funds.
SECTION 11. NO WAIVER.
No waiver by City of any Default shall be deemed to be a waiver of any other subsequent Default.
No delay or omission by City in exercising any right or power hereunder shall impair any such right or
power or be construed as a waiver thereof,nor shall any single or partial exercise of any such right or power
preclude other or further exercise thereof.
SECTION 12. BINDING EFFECT.
This Agreement shall be binding on the parties,their successors and assigns.No provision of this
Agreement may be amended,waived,or modified except pursuant to a written instrument executed by City,
Escrow Agent and Developer.
SECTION 13. CHOICE OF LAW;VENUE.
City of Fort Worth,Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
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This Agreement is to be construed and interpreted in accordance with the laws of the State of Texas.
Venue shall be in the state courts located in Tarrant County, Texas or the United States District Court
for the Northern District of Texas, Fort Worth Division.
SECTION 14. COUNTERPARTS.
This Agreement may be executed in any number of multiple counterparts and by different parties
on separate counterparts,all of which when taken together shall constitute one and the same agreement.
SECTION 15. INDEMNITY.
DEVELOPER HEREBY AGREES TO RELEASE, HOLD HARMLESS, AND
INDEMNIFY ESCROW AGENT (AND ITS DIRECTORS, OFFICERS, EMPLOYEES,AGENTS
AND REPRESENTATIVES) FROM AND AGAINST ALL CLAIMS, DAMAGES, EXPENSES,
COSTS, SUITS AND OTHER LIABILITY OF ANY HIND WHATSOEVER THAT ARISE OUT
OF OR ARE DIRECTLY OR INDIRECTLY RELATED TO THE PERFORMANCE BY ESCROW
AGENT OF ITS DUTIES HEREUNDER EXCEPT FOR THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF ESCROW AGENT OR ITS DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR REPRESENTATIVES AND DEVELOPER HEREBY AGREES TO
RELEASE, HOLD HARMLESS, AND INDEMNIFY CITY (AND ITS RESPECTIVE
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS AND REPRESENTATIVES) FROM AND
AGAINST ALL CLAIMS,DAMAGES,EXPENSES,COSTS,SUITS AND OTHER LIABILITY OF
ANY HIND WHATSOEVER THAT ARISE OUT OF OR ARE DIRECTLY OR INDIRECTLY
RELATED TO ANY ACTIONS OR INACTION BY CITY WITH RESPECT TO THIS
AGREEMENT.
SECTION 16. PAYMENT OF ESCROW FEES.
Developer will be responsible for the payment of all fees to Escrow Agent associated with this
Agreement.
SECTION 17. ESCROW AGENT DUTIES.
a. Duties Limited. The Escrow Agent shall perform only the duties expressly set forth
herein and no further duties or responsibilities shall be implied. The Escrow Agent shall have no
liability under and no duty to inquire as to the provisions of any agreement other than this
Agreement. The Escrow Agent shall have no duty to solicit any funds that may be required to be
deposited hereunder with Escrow Agent.
b. Reliance. The Escrow Agent may rely upon, and shall be protected in acting or
refraining from acting upon, any written notice, instruction or request furnished to it hereunder
and believed by it to be genuine and to have been signed or presented by the proper party or parties.
The Escrow Agent shall be under no duty to inquire into or investigate the validity, accuracy or
content of any such document.
C. Good Faith. The Escrow Agent shall not be liable for any action taken or omitted
by it in good faith except to the extent that a court of competent jurisdiction determines that the
Escrow Agent's negligence, gross negligence or willful misconduct was the primary cause of any
loss to City or Developer. The Escrow Agent may execute any of its powers and perform any of
City of Fort Worth,Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
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its duties hereunder directly or through agents or attorneys, and may consult with counsel,
accountants and other skilled persons to be selected and retained by it.
d. Adverse Claim, Interpleader. If there is any disagreement or dispute in connection
with this Agreement or the subject matter hereof, or in the event of adverse or inconsistent claims
or demands upon, or inconsistent instructions to, Escrow Agent, or if Escrow Agent in good faith
is in doubt as to what action to take pursuant to this Agreement,Escrow Agent may, at its election,
refuse to comply with any such claims, demands, or instructions, or refuse to take any other action
pursuant to this Agreement until:
(i) the rights of all persons involved in the dispute have been fully and finally
adjudicated by a court of competent jurisdiction; or
(ii) all disputes have been resolved between the parties involved, and Escrow
Agent has received written notice thereof satisfactory to it from all such persons. Without
limiting the generality of the foregoing, Escrow Agent may, at its election, institute an
action for interpleader and deposit the Escrow Funds or any portion thereof into the registry
of a court of competent jurisdiction in Tarrant County, Texas, or commence judicial
proceedings for declaratory judgment, and Escrow Agent shall be entitled to recover from
Developer, its attorneys' fees and costs in connection with any such interpleader or
declaratory judgment action. Anything in this Agreement to the contrary notwithstanding,
in no event shall the Escrow Agent be liable for special, indirect or consequential loss or
damage of any kind whatsoever (including but not limited to lost profits), even if the
Escrow Agent has been advised of the likelihood of such loss or damage and regardless of
the form of action.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
City of Fort Worth,Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
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ACCORDINGLY, the City, Developer, and Escrow Agent have each caused this Agreement to
be executed in each entity's respective name by its duly authorized signatories effective as of the date
executed by the City's Assistant City Manager or their designee.
CITY OF FORT WORTH
DEVELOPER
FG Aledo Development,LLC
ziwa� ��� By: KTFW Investments,Inc.
Dana Burgh 0:40 CDT)
Dana Burghdoff
Assistant City Manager
Kim Gill Oct 10,202210:16 CDT)
Date: Oct 13,2022 Name: Kim Gill
Title: President
Recommended by: Date: oct 10,2022
ESCROW AGENT
Tiffany Bacon Simmons Bank
Land Agent
Contract Management Office
David Ndssell
David Hassell(Oct 12,2022 12:21 CDT)
Approved at to Form &Legality: Name: J. David Hassell
Title: Market Executive
4K2,--
Richard A.McCracken(Oct 12,2022 21:43 CDT) Date: Oct 12,2022
Richard A. McCracken
Assistant City Attorney
M&C No. NSA Contract Compliance Manager
Date:
Form 1295: N/A By signing I acknowledge that I am the person
responsible for the monitoring and administration
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Jannette S. Goodall �'�°°°°°°°°°°°o° � Janie Scarlett Morales
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OFFICIAL RECORD
CITY SECRETARY
City of Fort worth,Texas FT. WORTH, TX
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
Page 8 of 9
ATTACHMENT "1"
Changes to Standard Agreement
Escrow Pledge Agreement to Replace Completion Agreement
Negotiated changes are contained in the body of the Agreement.
City of Fort Worth,Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev:10/19
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