HomeMy WebLinkAboutContract 60953Date Received: Feb 15, 2024
Time Received: 3:31 p.m.
City Secretary
Contract No.: 60953
ESCROW AGREEMENT TO REPLACE COMPLETION AGREEMENT
Escrow No. 3002-393213
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"), Quail Valley Devco
VLO, LLC ("Developer"), and American Escrow Company, a Texas corporation ("Escrow Agent").
WHEREAS, City and Developer entered into a Community Facilities Agreement for Walsh
Ranch PA3W-B (CFA# 22-0068, City Project Number 104054 and City Secretary No. 58093) for the
construction of water, sewer, paving, and storm drain 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 and Developer previously executed a Completion Agreement as the financial
security guaranteeing satisfactory compliance with the CFA Obligations ("Completion Agreement"); and
WHEREAS, the CFA and the Completion Agreement are filed with the City Secretary as City
Secretary Contract Number 58093; 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 one million, four hundred ninety three thousand,
five hundred seventy four dollars and thirty eight cents ($1,493,574.38), which sum represents one
City of Fort Worth, Texas OFFICIAL RECORD
Escrow Pledge Agreement to Replace Completion Agreement CITY SECRETARY
Rev: 10/19 FT. WORTH, TX
Page 1 of 10
hundred twenty-five percent (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.
The Security Funds shall not be held by Escrow Agent in an interest -bearing money market account at Texas
Capital Bank or Citibank. If Escrow Funds are to be invested in an interest -bearing money market account,
any interest accrued thereon shall be disbursed to Developer (which, in this paragraph only, is referred to as the
"Investor"), who or which will provide a fully executed W-9 and Investment Letter to Escrow Agent before
such investment will be made. The interest earned on the invested money market funds held in escrow for the
Investor shall not become part of the escrow funds. The parties are advised that FDIC insurance of bank
deposits for all accounts at any FDIC insured bank is currently $250,000.00. Each numbered account of
Escrow Agent is FDIC insured in this manner, but this insured FDIC limit includes other escrow accounts held
in escrow for any party which is participating in more than one escrow with Escrow Agent or has individual
accounts at such bank. FDIC insurance can be increased to a maximum of $150,000,000.00 for any single
escrow or multiple, cumulative escrows by using a program utilized by Texas Capital Bank to hold the escrow
deposit described herein (the "Program") which will provide full FDIC coverage of the total amount of escrow
funds of a party, but such party must request the use of this Program by notice to Escrow Agent and provide to
Escrow Agent in such notice the full name of any bank(s) and ABA number(s) in which such party has deposits
in order to exclude such bank(s) from the Program. If the IntraFi account is utilized and the disbursement
request is a final request which will disburse all Escrow Funds, then the parties are advised that such request
will require three (3) business days to make such disbursement. If the disbursement request is not a final
request, then such request will require one (1) to two (2) business days to make such disbursement depending
on the time of day it was received.
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) immediately 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 of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 2 of 10
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
(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) Remedv. 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 immediately 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;
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 3 of 10
(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: Developer: Quail Valley Devco VLO, LLC
Attention: Seth Carpenter
400 S. Record St. Ste 1200
Dallas, TX 75202
Email: Carpenter@republicpropertygroup.com
To: Escrow Agent: American Escrow Company
Attention: Shauna Dawson
2626 Howell Street, 10' Floor
Dallas, Texas 75204
Email: sdawsonaa,renublictitle.com
Phone: 214-754-7768
With a copy to: American Escrow Company
Attn: William A. Kramer
2626 Howell St., 10 h Floor
Dallas, Texas 75204
Email: bkramer(a,renublictitle.com
Phone: 214-855-8850
To: City of Fort Worth
Attn: City Treasurer
200 Texas Street
Fort Worth, Texas 76102
With a copy to: City of Fort Worth
Atten: CFA Administration
200 Texas Street
Fort Worth, Texas 76102
Email: zzDEVSVCS CFA(afortworthtexas.2ov
Phone: (817) 392-7810
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.
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 4 of 10
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 8.
(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.
(c) Developer shall provide City 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 the City.
(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 unconditional 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.
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 5 of 10
(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.
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 ESCROWAGENT (AND ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS
AND REPRESENTATIVES) FROM AND AGAINST ALL CLAIMS, DAMAGES, EXPENSES,
COSTS, SUITS AND OTHER LIABILITY OF ANY KIND WHATSOEVER THAT ARISE OUT
OF OR ARE DIRECTLYORINDIRECTLYRELATED TO THE PERFORMANCE BYESCROW
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 HEREBYAGREES TO
RELEASE, HOLD HARMLESS, AND INDEMNIFY CITY (AND ITS RESPECTIVE
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS AND REPRESENTATIVES) FROM AND
AGAINSTALL CLAIMS, DAMAGES, EXPENSES, COSTS, SUITS AND OTHER LIABILITY OF
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 6 of 10
ANY KIND 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. PROVISIONS CONCERNING ESCROW AGENT
(a) Wire Transfers and Wire Transfer Verifications: All monetary funds to be held in escrow pursuant
to this Escrow Agreement are to be sent to Escrow Agent by Federal wire transfer. The parties
acknowledge that they may be charged fees by their banks in connection therewith. Automated
Clearing House (ACH) transfers, wires or checks will not be accepted as monetary funds to be
held in escrow. Escrow fees may be paid by check or Federal wire. If requested by a party,
Escrow Agent will make disbursements by check and send such checks by regular mail, or
certified mail in accordance with the notice provisions hereof. Federal wire transfers of monetary
disbursements by Escrow Agent must be verified by a phone call from a representative of Escrow
Agent to the named representative and phone number set forth in the notice provisions hereof
prior to a wire being transmitted. Such phone call will request the party being contacted to confirm
the amount to be wired, the name of the bank to receive the wire, the American Bankers
Association (ABA) routing number of the receiving bank, the name of the account at such bank
to which the wire transfer will be credited, and the bank identification number of such account.
Escrow Agent's fee specified herein contemplates no more than twelve (12) such Federal wire
transfers and confirmations during each twelve (12) month period of this Escrow Agreement and
any wire and verification in excess thereof will be charged $150.00 each within such twelve (12)
month period, beginning on the effective date of this Escrow Agreement.
(b) Escrow Agent is not a party to, or bound by any agreement which may be deposited under,
evidenced by, or which arises out of the foregoing instructions.
(c) Escrow Agent acts hereunder as a depository only and is not responsible or liable in any manner
whatever for the sufficiency, correctness, genuineness, or validity of any instrument deposited
with it hereunder, or with respect to the form or execution of the same, or the identity, authority,
or rights of any person executing or depositing the same.
(d) Escrow Agent shall not be required to take or be bound by notice of any default of any person, or
to take any action with respect to such default involving any expense or liability, unless notice in
writing is given to an officer of Escrow Agent of such default.
(e) Escrow Agent shall be protected by Developer in acting upon any notice, request, waiver, consent,
receipt, or other paper or document believed by Escrow Agent in good faith to be genuine and to
be signed by the proper party or parties.
(fl Escrow Agent may consult with legal counsel in the event of any dispute or questions as to the
construction of the foregoing instructions, or Escrow Agent's duties hereunder.
(g) Escrow Agent assumes no liability and the parties hereto consent and agree that Escrow Agent
shall have no liability for any defalcation, insolvency, receivership or conservatorship of the
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 7 of 10
depository institution (Texas Capital Bank), nor shall Escrow Agent have any liability due to any
of the parties other than Escrow Agent filing for bankruptcy or the consequences or effect of such
a bankruptcy on the funds and/or documents deposited hereunder.
(h) For its ordinary services hereunder, Escrow Agent shall be entitled to a fee of $2,000.00, payable
by Developer concurrently with its acceptance hereof.
(i) Developer further agrees that Escrow Agent assumes no liability for and is expressly released
from any claim or claims whatsoever in connection with the receiving, retaining and delivering of
the above papers and funds except to account for payment and/or delivery made thereon. Deposit
by Escrow Agent of the instruments and funds (less its charges and expenses incurred herein)
comprising this escrow in Court, shall relieve Escrow Agent of all further responsibility and
liability, and Escrow Agent is hereby expressly authorized after filing a petition with the court
and depositing the funds with the court to disregard in its sole discretion any and all notices or
warnings given by any of the parties hereto, or by any other person or corporation, but the said
Escrow Agent is hereby expressly authorized to regard and to comply with and obey any and all
orders, judgments or decrees entered or issued by any court with jurisdiction. In case of any suit
or proceeding regarding this escrow to which Escrow Agent is or may be at any time a party,
Developer agrees to indemnify and hold harmless Escrow Agent from all loss, costs or damages
incurred, including but not limited to attorneys' fees, by reason of this Agreement or the subject
matter hereof or any cause of action which may be filed in connection therewith and to pay Escrow
Agent, upon demand all such costs, fees and expenses so incurred.
SECTION 18. TERMINATION OF COMPLETION AGREEMENT
The Completion Agreement is hereby terminated.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 8 of 10
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 City Manager or their designee.
CITY OF FORT WORTH
TjQIZCL �Le
Dana Burghdoff(Feb 2024 CST)
Dana Burghdoff
Assistant City Manager
Date: Feb 15, 2024
Recommended by:
0- ".
Dwayne Hollars (Feb 13, 202413:29 CST)
Name: Dwayne Hollars
Title: Contract Compliance Specialist
Development Services
Approved at to Form & Legality:
Thomas Royce Hansen
Assistant City Attorney
M&C No. N/A
Form 1295: N/A
4,dg40pgIl�
1 o°$
ATTEST: ono �9a°o
PVe o=d
pP�* aoo oQo *�d
A dpQnT°nE°�n°544o
Jannette Goodall // Ronald Gonzales
City Secretary // Assistant City Secretary
City of Fort Worth, Texas
Escrow Pledge Agreement to Replace Completion Agreement
Rev: 10/19
Page 9 of 10
DEVELOPER
Quail Valley Devco VLO, LLC
Set ar�Feb 13, 2024 08:51 CST)
Name: Seth Carpenter
Title: Vice President
Date: Feb 13, 2024
ESCROW AGENT
American Escrow Company
William A K'GImew
william A. Kramer (Feb 13, 202412:17 CST)
Name: William A. Kramer
Title: Authorized Signer
Date: Feb 13, 2024
Contract Compliance Manager
By signing I acknowledge that I am the person
responsible for the monitoring and administration
of this contract, including ensuring all
performance and reporting requirements.
—46,1^
Rebecca Owen (Feb 14, 2024 08:05 CST)
Name: Rebecca Diane Owen
Title: Development Manager
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH, TX
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
Page 8 of 10