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HomeMy WebLinkAboutResolution - 2024-R0128 - Contract With Kroll, LLC, For Appraisal Services Of City-Owned Property - 03/26/2024Resolution No. 2024-R0128 Item No. 5.15 March 26, 2024 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock is hereby authorized and directed to execute for and on behalf of the City of Lubbock, a Professional Services Agreement for property appraisal and valuation services, by and between the City of Lubbock and Kroll, LLC, and related documents. Said Agreement is attached hereto and incorporated in this resolution as if fully set forth herein and shall be included in the minutes of the City Council. Passed by the City Council on _ March 26, 2024 Tttn ATTEST: Courtney Paz, ity Secretary Al'PROVED AS TO CONTENT: D. u Kos lich, Chie � inancial Officer Al'PROVED AS TO FORM: . ��� Je Hartsell, Chief Litigation Attorney vw:ccdocslRES.PSA-Kroll, LLC March 8, 2024 Resolution No. 2024-R0128 PROFESSIONAL SERVICES AGREEMENT STATE OF TEXAS § COUNTY OF LUBBOCK § This Professional Service Agreement ("Agreement") Contract No is entered into this day of �rch 26 , 2024, is by and between the City of Lubbock (the "City"), a Texas home rule municipal corporation, and Kroll, LLC, (the "Appraiser"). WTTNESSETI i WHEREAS, The City desires to contract with the Appraiser to provide the City a property insurance appraisal for the City's use in connection with its internal analysis of its insurance needs with respect to the identified property, (the "Activities"); and WHEREAS, the Appraiser has a professional staff experienced and is qualified to provide professional appraisal services related to Activities, and will provide the services, as defined below, for the price provided herein, said price stipulated by the City and the Appraiser to be a fair and reasonable price; and WHEREAS, the City desires to contract with the Appraiser to provide professional services related to the Activities, and Appraiser desires to provide the Services related to same. NOW THEREFORE, for and in consideration of the terms, covenants and conditions set forth in this Agreement, the City and the Appraiser hereby agree as follows: ARTICLE I. TERM The term of this Agreement commences on the Effective Date and continues without interruption for a term of one year. An amendment to this Agreement resulting in an increase in the amount of the consideration must be approved by the City acting through its governing body. ARTICLE II. SERVICES AND COMPENSATION Kroll shall research and report the insurable value of City-owned facilities as directed by the City. Kroll's compensation for these services shall not exceed $60,000. ARTICLE III. TERMINATION A. General. The City may terminate this Agreement, for any reason or convenience, upon thirty (30) days written notice to the Appraiser. In the event this Agreement is so terminated, the City shall only pay the Appraiser for services actually performed by the Appraiser up to the date of termination, as provided herein. 1of16�Page B. Termination and Remedies. In the event the Appraiser breaches any term and/or provision of this Agreement, the City shall be entitled to exercise any right or remedy available to it by this Agreement, at law, equity, or otherwise, including without limitation, termination of this Agreement and assertion of an action for damages and/or injunctive relief. The exercise of any right or remedy shall not preclude the concurrent or subsequent exercise of any right or remedy and all rights and remedies shall be cumulative. ARTICLE IV. NON - ARRITRATION The City reserves the right to exercise any right or remedy available to it by law, contract, equity, or otherwise, including without limitation, the right to seek any and all forms of relief in a court of competent jurisdiction. Further, the City shall not be subject to any arbitration process prior to exercising its unrestricted right to seek judicial remedy. The remedies set forth herein are cumulative and not exclusive, and may be exercised concurrently. To the extent of any conflict between this provision and another provision in, or related to, this Agreement, this provision shall control. ARTICLE V. REPRESENTATIONS AND WARRANTIES A. Existence. The Appraiser is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware and is qualified to carry on its business in the State of Texas. B. Corporate Power. The Appraiser has the corporate power to enter into and perform this Agreement and all other activities contemplated hereby. C. Authorization. Execution, delivery, and performance of this Agreement and the activities contemplated hereby have been duly and validly authorized by all the requisite corporate action on the part of the Appraiser. This Agreement constitutes legal, valid, and binding obligations of the Appraiser and is enforceable in accordance with the terms thereof. D. Appraiser. The Appraiser maintains a professional staff and employs, as needed, other qualified specialists experienced in providing the Services, and is familiar with all laws, rules, and regulations, both state and federal, including, without limitation the applicable laws, regarding the Activities contemplated hereby. E. Performance. The Appraiser will and shall conduct all activities contemplated by this Agreement in accordance with the standard of care, skill and diligence normally provided by a professional person in performance of similar professional services, and comply with all 2of16�Page applicable laws, rules, and regulations, both state and federal, relating to professional services, as contemplated hereby. F. Use of Copyrighted Material. The Appraiser warrants that any materials provided by the Appraiser for use by City pursuant to this Agreement shall not contain any proprietary material owned by any other party that is protected under the Copyright Act or any other law, statute, rule, order, regulation, ordinance or contractual obligation relating to the use or reproduction of materials (this excludes data Appraiser has obtained publicly or licensed with a third party data provider). The Appraiser shall be solely responsible for ensuring that any materials provided by the Appraiser pursuant to this Agreement satisfy this requirement and the Appraiser agrees to indemnify and hold City harmless from all liability or loss caused to City or to which City is exposed on account of a third party claim that arises from the Appraiser's violation of a third party's intellectual property rights. ARTICLE VI. SCOPE OF WORK The Appraiser shall accomplish the following: Professional Services related to the Services, as related to fixed asset management and insurance solutions, as set forth in Exhibit "A" the terms of which (including, for the avoidance of doubt, Exhibit B) are �ully incorporated herein by reference). ARTICLE VII. INDEPENDENT CONTRACTOR STATUS The Appraiser and the City agree that the Appraiser shall perform the duties under this Agreement as an independent contractor and shall be considered as independent contractor under this Agreement and/or in its activities hereunder for all purposes. The Appraiser has the sole discretion to determine the manner in which the Services are to be performed. During the performance of the Services under this Agreement, the Appraiser and the Appraiser's employees and/or sub-consultants, will not be considered, for any purpose, employees or agents of the City within the meaning or the application of any federal, state or local law or regulation, including without limitation, laws, rules or regulations regarding or related to unemployment insurance, old age benefits, workers compensation, labor, personal injury or taxes of any kind. ARTICLE VIII. INSURANCE The Appraiser shall procure and carry, at its sole cost and expense through the life of this Agreement, except as otherwise provided herein, insurance protection as hereinafter specified, carried with an insurance coinpany authorized to transact business in the state of Texas, covering 3of16 � Page all aspects and risks of loss of all operations in connection with this Agreement. The Appraiser shall obtain and maintain in full force and effect during the term of this Agreement, and shall cause each approved subcontractor or sub-consultant of the Appraiser to obtain and maintain in full force and effect during the term of this Agreement, commercial general liability, professional liability and automobile liability coverage for non-owned and hired vehicles with insurance carriers admitted to do business in the state of Texas. The insurance companies must carry a Best's Rating of A-VII or better. Except for Professional Liability, the policies will be written on an occurrence basis, subject to the following minimum limits of liability: Commercial General Liability: Per Occurrence Single Limit: $1,000,000 General Aggregate Limit: $2,000,000 Professional Liability (claims-made): Combined Single Limit: $2,000,000 Automobile Liability: Combined Single Limit for any auto: $1,000,000 Per Occurrence Employer's Liability: Per Occurrence Single Limit: $1,000,000 Worker's Compensation Per Occurrence Single Limit: $500,000 The City shall be included as an additional insured and the policies shall be deemed a primary and noncontributory with respect to the Automobile Liability and Commercial General Liability and shall be granted a waiver of subrogation under those policies. The Appraiser shall provide a Certificate of Insurance to the City as evidence of coverage; as well as endorsements affording the City additional insured status on the general and auto liability coverage and waivers of subrogation for the general liability, auto liability and workers compensation coverages. The Certificate shall provide 30-day notice of cancellation. A copy of the additional insured endorsements and waivers of subrogation shall be included in the Certificate. The Appraiser shall elect to obtain worker's compensation coverage pursuant to Section 406.002 of the Texas Labor Code. Further, the Appraiser shall maintain said coverage throughout the term of this 4of16�Page Agreement and shall comply with all provisions of Title 5 of the Texas Labor Code to ensure that the Appraiser maintains said coverage. The Appraiser may maintain Occupational Accident and Disability Insurance in lieu of Worker's Compensation. In either event, the policy must be endorsed to include a waiver of subrogation in favor of the City. If at any time during the life of the Agreement or any extension hereof, the Appraiser fails to maintain the required insurance in full force and effect, the Appraiser shall be in breach hereof and all work under the Agreement shall be discontinued immediately. Notwithstanding anything contained herein to the contrary, the professional liability policy shall be maintained at the Appraiser's sole cost and expense. The retroactive date shall be no later than the commencement of the performance of this Agreement and the discovery period (possibly through tail coverage) shall be no less than 3 years after the completion of the Services provided for in this Agreement. The provisions of this Article VIII shall survive the termination or expiration of this Agreement. ARTICLE IX. EMPLOYMENT OF AGENTS/RETAINING OF CONSULTANTS The Appraiser may employ or retain consultants, contractors, or third parties (any of which are referred to herein as "Sub-consultant"), to perform certain duties of Appraiser, under this Agreement, provided that the City approves the retaining of Sub-consultants. The Appraiser is at all times responsible to the City to perform the Services as provided in this Agreement and the Appraiser is in no event relieved of any obligation under this Agreement upon retainage of any approved Sub-consultant. Any agent and/or Sub-consultant retained and/or employed by the Appraiser shall be required by the Appraiser to carry, for the protection and benefit of the City and the Appraiser and naming said third parties as additional insureds, insurance as described above required to be carried by the Appraiser in this Agreement. ARTICLE X. CONFIDENTIALITY The Appraiser shall retain all information received from or concerning the City and the City's business in strictest confidence and shall not reveal such information to third parties without prior written consent of the City, unless otherwise required by law. ARTICLE XI. INDEMNITY THE APPRAISER SHALL INDEMNIFY AND SAVE HARMLESS THE CITY OF LUBBOCK AND ITS ELECTED OFFICIALS, OFFICERS, AGENTS, AND EMPLOYEES FROM ALL THIRD PARTY SUITS, ACTIONS, LOSSES, DAMAGES, CLAIMS, OR 5of16�Page LIABILITY OF ANY KIND, CHARACTER, TYPE, OR DESCRIPTION, INCLUDING WITHOUT LMITING THE GENEKALITY OF T�-IE FOREGOING, ALL EXPENSES OF LITIGATION, COURT COSTS, AND ATTORNEY'S FEES, FOR INNRY OR DEATH TO ANY PERSON, OR INJURY TO ANY TANGIBLE PROPERTY, RECENED OR SUSTAINED BY ANY PERSON OR PERSONS OR TANGIBLE PROPERTY, TO THE EXTENT AAISING OUT OF, RELATED TO OR OCCASIONED BY, THE NEGLIGENT ACTS OF THE APPRAISER, ITS AGENTS, EMPLOYEES, ANDIOR SUBCONSULTANTS 1N TIIE PERFORMANCE UNDER THIS AGREEMENT WHILE ON-SITE AT CITY OWNED PROPERTY. THE INDEMNITY OBLIGATION PROVIDED HEREIN SHALL SURVNE THE EXPIRATION OR TERMINATION OF THIS AGREEMENT. ARTICLE XII. COMPLIANCE WITH APPLICABLE LAWS The Appraiser shall comply with all applicable federal, state and local laws, statutes, ordinances, rules and regulations relating, in any way, manner or form, to the activities under this Agreement, and any amendments thereto. ARTICLE XIII. NOTICE A. General. Whenever notice from the Appraiser to the City or the City to the Appraiser is required or permitted by this Agreement and no other method of notice is provided, such notice shall be given by (1) actual delivery of the written notice to the other party by hand (in which case such notice shall be effective upon delivery); (2) facsimile (in which case such notice shall be effective upon delivery); or (3) by depositing the written notice in the United States mail, properly addressed to the other party at the address provided in this article, registered or certified mail, return receipt requested, in which case such notice shall be effective on the third business day after such notice is so deposited. B. Appraiser's Address. The Appraiser's address and numbers for the purposes of notice are: Kro11, LLC John Quincy 919 Congress Ave, Suite 1450 Austin, TX 78701 Telephone: 630-541-4651 6of16�Page With a copy to: Kroll, LLC Attn: General Counsel 55 East 52"d Street New York, NY 10055 C. City's Address. The City's address and numbers for the purposes of notice are: Lainey Morrison City of Lubbock 1314 Avenue K Lubbock, Texas 79401 Telephone: 806-775-2316 D. Change of Address. Either party may change its address or numbers for purposes of notice by giving written notice to the other party as provided herein, referring specifically to this Agreement, and setting forth such new address or numbers. The address or numbers shall become effective on the 15th day after such notice is effective. ARTICLE XIV. CITY-PROVIDED DATA AND RESPONSIBILITIES Provision of Data. The City shall furnish the Appraiser non-confidential studies, reports and other available data in the possession of the City pertinent to the Appraiser's Services, so long as the City is entitled to rely on such studies, reports and other data for the performance of the Appraiser's Services under this Agreement (the "Provided Data"). The Appraiser shall be entitled to use and rely, so long as such reliance is reasonable, upon all such Provided Data. ARTICLE XV. MISCELLANEOUS A. Captions. The captions for the articles and sections in this Agreement are inserted in this Agreement strictly for the parties' convenience in identifying the provisions to this Agreement and shall not be given any effect in construing this Agreement. B. Audit. The Appraiser shall provide access to its corporate books and records to the City. The City may audit, at its expense and during normal business hours, the Appraiser's books and records with respect to this Agreement between the Appraiser and the City (records available for review shall exclude any records pertaining to Appraiser's other clients and other confidential and proprietary records not associated with the Services and nothing set forth in this Agreement shall require Appraiser to grant the City any network or physical access to Appraiser's facilities, systems or infrastructure. 7of16�Page C. Records. The Appraiser shall maintain records that are necessary to substantiate the services provided by the Appraiser. D. Assignability. The Appraiser may not assign this Agreement without the prior written approval of the City. E. Successor and Assigns. This Agreement binds and inures to the benefit of the City and the Appraiser, and in the case of the City, its respective successors, legal representatives, and assigns, and in the case of the Appraiser, its permitted successors and assigns. F. Construction and Venue. Tf-IIS AGREEMENT SIIALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. THIS AGREEMENT IS PERFORMABLE IN LUBBOCK COUNTY, TEXAS. THE PARTIES HERETO HEREBY IRREVOCABLY CONSENT TO THE SOLE AND EXCLUSIVE JURISDICTION AND VENUE OF THE COURTS OF COMPETENT JURISDICTION OF THE STATE OF TEXAS, COUNTY OF LUBBOCK, FOR THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS THAT ARE CONTEMPLATED HEREBY. G. Severability. If any provision of this Agreement is ever held to be invalid or ineffective by any court of competent jurisdiction with respect to any person or circumstance, the remainder of this Agreement and the application of such provision to persons and/or circumstances other than those with respect to which it is held invalid or ineffective shall not be affected thereby. H. Amendment. No amendment, modification, or alteration of the terms of this Agreement shall be binding unless such amendment, modification, or alteration is in writing, dated subsequent to this Agreement, and duly authorized and executed by the Appraiser and the City. I. Entire Agreement. This Agreement, including Exhibit "A" attached hereto, contains the entire agreement between the City and the Appraiser, and there are no other written or oral promises, conditions, warranties, or representations relating to or affecting the matters contemplated herein. J. No Joint Enterprise. Nothing contained herein shall be construed to imply a joint venture, joint enterprise, partnership or principal agent relationship between the Appraiser and the City. 8of16 � Page K. Documents Owned by City. Any and all iinal reports prepared by Appraiser as part of the Services hereunder, shall become the property of the City when the Appraiser has been compensated as set forth in II, above. The Appraiser shall make copies of any and all work products for its files. The City will define the contents of the final report. L. Notice of Waiver. A waiver by either the City or the Appraiser of a breach of this Agreement must be in writing and duly authorized to be effective. In the event either party shall execute and deliver such waiver, such waiver shall not affect the waiving party's rights with respect to any other or subsequent breach. M. Third Party Activities. Nothing in this Agreement shall be construed to provide any rights or benefts whatsoever to any party other than the City and the Appraiser. N. Non-Appropriation. All funds for payment by the City under this Agreement are subject to the availability of an annual appropriation for this purpose by the City. In the event of non-appropriation of funds by the City Council of the City of Lubbock for the services provided under the Agreement, the City will terminate the Agreement, without termination charge or other liability, on the last day of the then-current fiscal year or when the appropriation made for the then- current year for the services covered by this Agreement is spent, whichever event occurs �rst (the "Non-Appropriation Date"). If at any time funds are not appropriated for the continuance of this Agreement, cancellation shall be accepted by the Appraiser on thirty (30) days prior written notice, but failure to give such notice shall be of no effect and the City shall not be obligated under this Agreement beyond the Non-Appropriation Date. O. SB 252. SB 252 prohibits the City from entering into a contract with a vendor that is identified by The Comptroller as a company known to have contracts with or provide supplies or service with Iran, Sudan or a foreign terrorist organization. P. No Boycott of Israel. Pursuant to Section 2270.002 of the Texas Government Code, Respondent certifies that either (i) it meets an exemption criteria under Section 2270.002; or (ii) it does not boycott Israel and will not boycott Israel during the term of the contract resulting from this solicitation. Respondent shall state any facts that make it exempt from the boycott certification in its Response. Q. Texas Public Information Act. The requirements of Subchapter J, Chapter 552, Government Code, may apply to this contract and the contractor or vendor agrees that the contract can be terminated if the contractor or vendor knowingly or intentionally fails to comply with a 9of16�Page requirement of that subchapter. To the extent Subchapter J, Chapter 552, Government Code applies to this agreement, Contractor agrees to: (1) preserve all contracting information related to the contract as provided by the records retention requirements applicable to the governmental body for the duration of the contract; (2) promptly provide to the governmental body any contracting information related to the contract that is in the custody or possession of the entity on request of the governmental body; and (3) on coinpletion of the contract, either: (A) provide at no cost to the governmental body all contracting information related to the contract that is in the custody or possession of the entity; or (B) preserve the contracting information related to the contract as provided by the records retention requirements applicable to the governmental body. REMATNDER O�' PAGE LE�T BLANK INTENTIONALLY 10of16 � Page EXECUTED as of the Effective Date hereof. CITY OF LUBBOCK ATTEST Courtney Paz, City Secretary P ED AS TO CONTENT: ainey Morrison, Risk Manager APPROVED AS TO FORM: U /� J H rtsell, Deputy City Attorney Finn By: Kroll, LLC 11of16�Page EXHIBIT A - ENGAGEMENT LETTER Kroll, LLC ("Kroll" "we" "our"), will provide City of Lubbock ("the City" "you" "your") the appraisal services described within this Exhibit A. PURPOSE OF THE ENGAGEMENT The purpose of this engagement is to provide the City a property insurance appraisal for the City's use in connection with its internal analysis of its insurance needs with respect to the identified property. Our analysis will be dated as of the last day of our site inspection. Our opinion is intended to assist the City in making informed business decisions; it is not a recommendation. Any decisions relating to insurance coverage shall remain the City's responsibility and be made solely at its discretion. ENGAGEMENT SCOPE We will research and report the insurable value (our "Opinion") of certain the City property. DESCRIPTION OF IDENTIFIED PROPERTY The property is located at various sites as identified by the City in the Property Schedule. These property classifications will be included in the engagement: 1) Buildings, including 163 buildings (15 new buildings and 148 greater than $1 million) 2) Personal Property If the City's insurance policy excludes coverage of speciiic property classifications, in part or whole, the City should notify us in writing prior to beginning the engagement if those assets should be excluded. We will work with the City during the engagement to further refine the scope of the identiiied property to be included in the engagement, if applicable. Depending on the nature and extent of changes in the scope of the engagement we may need to revise our fee. 12of16) Page DEFINITION OF INSURABLE VALUE We will develop our opinion of insurable value as the replacement cost value (RCV), defined as the estimated amount required to reproduce a property entirely at one time, in like kind and quality, in accordance with current market prices for labor, materials, and manufactured equipment; contractors' overhead and profit; and fees, but without provisions for overtime, bonuses for labor, or premiums for materials and equipment. In estimating insurable value, we will allow for national building codes; however, we will not consider any construction codes imposed by state or local municipalities, ordinances, or other legal restrictions, nor will we consider the cost of demolition in connection with reconstruction or the cost of removal of destroyed property. VALUATION METHODOLOGY Our appraisal will rely solely on the cost approach because the market and income approaches are not applicable for the purpose of this engagement. SCOPE OF WORK We anticipate this engagement will include the following: BUILDINGS We will utilize a full scope segregated cost approach including an inspection of each building to identify construction data that will be used in the valuation process. During inspection of the premises, we will calculate each building's area and perimeter by measuring the structure, through an analysis of the as-built blueprints, or from other verified sources; identify and record data of the major construction components (type of structure, walls, roof, etc.); determine the construction class; record data of major service systems (electrical, plumbing, security, elevators, heating, ventilation, cooling, etc.); photograph the building; and record the GPS coordinates. The insurable value of each building and the related construction, occupancy, protection, and exposure data obtained during the inspection will be reported on an itemized basis. PERSONAL PROPERTY We will develop an opinion of the insurable value of personal property through use of a modeling approach, which relies on our proprietary database containing data from thousands of detailed equipment inventories we have performed. The model develops the insurable value of each building's personal property on the basis of building occupancy and square footage. The model can be altered to account for above- or below- Kroll � City of Lubbock February 21, 2024 3 average 13of16�Page density of personal property. A single insurable value will be reported for each building's personal property TERMS AND CONDITIONS This Agreement is subject to and incorporates the Terms and Conditions attached as Exhibit B. FEE The fee is $60,000, including expenses, and will be invoiced as follows: •$18,000, upon authorization of the engagement • Progress billing as time is charged and expenses are incurred. This fee includes issuing the deliverables below and responding to customary questions from City of Lubbock and its insurance brokers or advisors. Additional fee will be required for an increase in engagement scope or involvement in subsequent reviews beyond the customary work effort. City of Lubbock may cancel this engagement at any time and will only be obligated for fees and expenses incurred. Our fee is not contingent on our Opinion or any subsequent event related to it. TIMING ANn DELIVERABLES This engagement will require cooperation, access, and timely receipt of requested information from management of City of Lubbock. After this Agreement is signed and all requested information is received, we will begin our analyses and provide our Draft report within 6 to 8 weeks after completion of our site inspections. The report will be provided in electronic format and will present our Opinion and related narrative discussion of the supporting analyses and assumptions, along with appropriate exhibits. Additional relevant information and analyses considered in our Opinion will be retained in our work files. REMAINDER OF PAGE LEFT BLANK ITENTIONALLY 14of16� Page Exhibit 8— Terms and Conditions Entire Agreement — This is the entire Agreement between Kroll and City of Lubbock and supersedes any prior oral or written agreements. This Agreement may only be modified in writing signed by both parties. Any purchase order covering this engagement is only for City of Lubbock's internal needs and shall not modify this Agreement. Fees — Kroll's invoices are payable upon receipt. If payment of any invoice is not received within 45 days of the invoice date, Kroll shall be entitled, without prejudice to any other rights that it may have, to suspend services until all sums due are paid in full. In the event that Kroll is required to initiate a lawsuit or hire attorneys to collect any past due amounts, in addition to any other rights and remedies available, it shall be entitled to reimbursement of attorneys' fees and other costs of collection. Limited Use and Reliance — City of Lubbock is the sole intended user of Kroll's report or other work product. City of Lubbock may disclose an informational copy of the report or other work product to its audit, tax, legal, or insurance professionals acting in an advisory capacity in connection with the purpose of this engagement. No third party shall have the right of reliance on the report, and neither receipt nor possession of the report by any third party shall create any express or implied third-party beneficiary rights. Confidentiality — Kroll shall maintain the confidentiality of City of Lubbock's information and will not disclose or use it for any purpose other than in connection with this engagement. This excludes information (i) available to the public, (ii) already in Kroll's possession, or (iii) received from a party having no confdentiality obligation to City of Lubbock. Kroll may include City of Lubbock's name and logo in its client list. Engagement Limits — Kroll`s work may only be used for the specific purpose or premise of value stated in this Agreement and the work product. City of Lubbock shall not reference Kroll or its work in any public filing or other materials distributed to actual or prospective shareholders, investors, fnancing parties, or similar third parties without Kroll's prior written consent. Independent Contractor — Kroll shall perform as an independent contractor, with no authority to bind or obligate City of Lubbock in any way. Information Provided by City of Lubbock — Kroll will not independently verify information provided by City of Lubbock, its advisors, or third parties acting at City of Lubbock's direction. Kroll will assume and rely on the accuracy and completeness of all such information. Retention — All files, documents, and work papers received, created, or developed during the engagement will be retained for professional recordkeeping and legal/regulatory compliance purposes, all in accordance with Kroll's document retention policy. If required by applicable law to disclose any of the documents, Kroll will, unless legally prohibited, notify City of Lubbock so it may seek a protective order at its discretion. Indemnification — City of Lubbock shall indemnify and hold harmless Kroll and its afiiliates, including each of their respective employees, from and against any and all liabilities, losses, costs, 15of16�Page and reasonable expenses, including, but not limited to, reasonable legal fees and expenses and billable hours of client service personnel, which are (i) incurred in responding to subpoenas, discovery, or other similar inquiries associated with or arising from the engagement or (ii) arising from or relating to third-party claims based Kroll � City of Lubbock February 21, 2024 6 on reliance or purported reliance on Kroll's work product or other alleged loss or damage caused to or alleged by any nonclient entity arising from unauthorized access to or reliance upon Kroll's work product. The foregoing indemnification obligations shall not apply in the event that a court of competent jurisdiction finally determines that such claims resulted directly from the gross negligence, willful misconduct, or fraudulent acts of Kroll. Limitation of Liability — In no event shall Kroll be liable to City of Lubbock (or any person claiming through City of Lubbock) under this Agreement, under any legal theory, for any amount in excess of the total professional fees paid by City of Lubbock to Kroll in connection with this engagement, except to the extent such liability is directly caused by Kroll's gross negligence, fraud, or willful misconduct. The foregoing limitation of liability shall not apply to liabilities that arise from personal injury or property damage resulting primarily from Kroll's negligence or willful misconduct. In no event shall Kroll be liable to City of Lubbock for any consequential, indirect, lost profit, or similar damages relating to or arising from this engagement. Environmental Policy — Kroll will not investigate, nor assume responsibility for, the existence or impact of any contamination or hazardous substance related to property or assets associated with this engagement. Governing Law — This Agreement is governed by and construed in accordance with the laws of the State of New York 16of16�Page