04-1013_GATEWAY PACIFIC CONTRACTORS, INC_Escrow AgreementESCROW AGREEMENT FOR SECURITY DEPOSITS
IN LIEU OF RETENTION
This Escrow Agreement is made and entered into by and between City of San Juan
Capistrano whose address is 32400 Paseo Adelanto, San Juan Capistrano, CA 92675
hereinafter called "Owner", Gateway Pacific Contractors, Inc., whose address is 8055 Freeport
Blvd., Sacramento, Ca. 95832 hereinafter called "Contractor" and First Bank & Trust
hereinafter called "Escrow Agent' whose address is 865 Howe Avenue, Sacramento, CA
95825.
For the consideration hereinafter set forth, the Owner, Contractor, and Escrow Agent agree as
follows:
1) Pursuant to Section 22300 of the Public Contract Code of the State of California,
Contractor has the option to deposit securities with Escrow Agent as a substitute for retention
earnings required to be withheld by Owner pursuant to the Construction Contract entered into
between Owner and Contractor for Terminal Reservoir No. 3 in the amount of $10,527,276.00
dated September 21, 2P*reinafter the "Contract'). Alternatively, on written request of the
Contractor, the Owner shall make payments of the retention earnings directly to the Escrow
Agent. When Contractor deposits the securities as a substitute or Contract earnings, Escrow
Agent shall notify the Owner within ten (10) days of the deposit. The market value of the
securities at the time of the substitution shall be at least equal to the cash amount then required to
be withheld as retention under the terms of the Contract between Owner and Contractor.
Securities shall be held in the name of First Bank & Trust, as Escrow Agent, and shall designate
the Contractor as the beneficial owner.
2) Owner shall make progress payments to Contractor for those funds which otherwise
would be withheld from progress payments pursuant to the Contract provisions, provided that the
Escrow Agent holds securities in the form and amount specified above.
3) When the owner makes payment of retentions earned directly to the Escrow Agent,
the Escrow Agent shall hold them for the benefit of the Contractor until the time that the Escrow
created hereunder is terminated. The Contractor may direct the investment of the payments into
securities. All terms and conditions of this Agreement and the rights and responsibilities of the
parties shall be equally applicable and binding when the owner pays the Escrow Agent directly.
4) Contractor shall be responsible for paying all fees for the expenses incurred by
Escrow Agent in administering the escrow account (hereinafter the "Escrow Account') and all
expenses of the Owner. These expenses and payment terms shall be determined by the Owner,
Contractor, and Escrow Agent.
5) The interest earned on the securities or the money market accounts held in escrow and
all interest earned on that interest shall be for the sole account of Contractor and shall be subject
to withdrawal by Contractor at any time and from time to time without notice to the Owner.
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6) Contractor shall have the right to withdraw all or any part of the principal in the
Escrow Account only by written notice to Escrow Agent accompanied by written authorization
from Owner to the Escrow Agent that Owner consents to the withdrawal of the amount sought to
be withdrawn by Contractor.
7) Owner shall have a right to draw upon the securities in the event of default by
Contractor. Upon seven (7) days' written notice to the Escrow Agent from Owner of the default,
Escrow Agent shall immediately convert the securities to cash and shall distribute the cash as
instructed by the Owner.
8) Upon receipt of written notification from Owner certifying that the Contract is final
and complete, and that Contractor has complied with all requirements and procedures applicable
to the Contract, Escrow Agent shall release to Contractor all securities and interest on deposit
less escrow fees and charges of the Escrow Account. The escrow shall be closed immediately
upon disbursement of all moneys and securities on deposit and payments of fees and charges.
9) Escrow Agent shall rely on the written notifications from Owner and Contractor
pursuant to Sections Five (5) through Eight (8), inclusive, of this Agreement and Owner and
Contractor shall hold Escrow Agent harmless from Escrow Agent's release and disbursement of
the securities and interest as set forth above.
10) The names of the persons who are authorized to give written notice or to receive
written notice on behalf of Owner, on behalf of Contractor and on behalf of Escrow Agent in
connection with the foregoing, and exemplars of their respective signatures are as follows:
On behalf of Owner:
City of San Juan Capistrano
Public Works Director
Title
Amy Amirani
Name
v/ `� CJ�'vvV
Signature
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Address
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On behalf of Contractor:
Gateway Pacific Contractors, Inc.
Treasurer
Title
Wayne P. Riley
Name
\ \ v
Signatur
8055 Freeport Blvd.
Sacramento, CA 95832
Address
On behalf of Escrow Agent:
First Bank & Trust
Vice President
Title
Jean Howard Schaffer
N e
471�ture
865 Howe Avenue, Suite 310
Sacramento, CA 95825
Address
At the time the Escrow Account is opened, the Owner and Contractor shall deliver to Escrow
Agent fully executed counterpart of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement by their proper officers on
the date first set forth above.
Owner:
By: fiity of San Juan Capistrano
David F. Adams
Name
City Manager
Title
Signature
ATTEST: I�
_ Y �-
Marg re R. Monahan, City Clerk
APPROVED AS TO FORM:
Joh)ShO,Cit—ytAt-t—torney
c
Contractor:
By: Gateway Pacific Contractors, Inc.
Wayne P. Riley
Name
Treasurer
Title
Signature