Form Re 643g - Agreement And Escrow Instructions (Letter Of Credit - Va Start-Up) Form - California Bureau Of Real Estate
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AGREEMENT AND ESCROW INSTRUCTIONS
(Letter of Credit – VA Start-Up)
RE 643G (New 6/87)
1.
This agreement is entered into between:
a.
_________________________________________________________________________________________
doing business as _______________________________________________________________ (Subdivider).
b.
_________________________________________________________________________________________
A California Non-Profit Corporation (Association).
c.
_________________________________________________________________________________________
A California Corporation (Escrow).
2.
This agreement is executed pursuant to requirements of the Veteran’s Administration and the California Bureau of Real
Estate to secure the Subdivider’s obligation to deposit Working Capital Funds with the Association as owner of interests
in the subdivision known as _______________________________________________________________
in the City of ________________________, County of ____________________________, California (Subdivision).
Every owner, including Subdivider is required to deposit $ ______________________ with the Association as Working
Capital and not as pre-payment of assessments. Subdivider may delay payment for up to six months from conveyance
of the first interest in the Subdivision, at which time Subdivider is required to deposit the foregoing amount with the
Association. Should Subdivider deposit the funds or should the Letter of Credit securing this agreement be drawn
upon, Subdivider will be reimbursed out of each subsequent sale of an interest in the Subdivision.
3.
Pursuant to the obligation imposed by the Veteran’s Administration, the Subdivider is obligated to the Association in
the amount up to $ ______________________.
4.
If, at a date six months after the conveyance of the first interest in the Subdivision either all interests in the subdivision
have been sold or if the Subdivider has deposited Working Capital Funds with the Association for every interest in
the Subdivision to which title is held by Subdivider on that date, then this agreement shall terminate provided that the
following signed and dated statement of the Association is received by the Escrow:
The Association has received Working Capital Funds for every interest in the Subdivision.
5.
This agreement is secured by a Letter of Credit in the amount set forth above, number _____________ issued by
____________________________________________________________ (Bank/Savings & Loan) and dated
____________________. Receipt of the Letter of Credit is evidenced by the signature of the Escrow to this agreement.
6.
If the Subdivider defaults by failing to pay Working Capital Funds to the Association on or before the date set forth
in paragraph #4 above, then the Escrow shall forthwith draw upon the credit in an amount sufficient to pay Working
Capital Funds to the Association in the amount of $ ____________________ for each interest, title to which is then
held by the Subdivider. The funds shall forthwith be paid to the Association.
7.
If at any time during the duration of this agreement Escrow shall receive a notice from _______________________
_______________________________________ (Bank/Savings & Loan) that the Letter of Credit will not be renewed,
Escrow shall forthwith present the Letter of Credit for payment and hold and disburse the proceeds as necessary to
satisfy the Subdivider’s obligation under this agreement. Funds not disbursed to the Association shall be deposited in
an interest bearing account and the interest shall be paid quarterly to the Subdivider.
8.
Should the Subdivider deposit Working Capital Funds for interest to which Subdivider holds title, or if Escrow draws
on the Letter of Credit for the account of the Association, then the Working Capital Funds deposited by subsequent
purchasers from the Subdivider shall be forthwith paid to the Subdivider in reimbursement of the deposits previously
made.
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