Escrow Agreement.doc

(*1)STATE REVOLVING FUND LOAN ESCROW AGREEMENT THIS ESCROW AGREEMENT is made this _ day of _ between the (*1) (hereinafter referred to as the Borrower) and _, a depository authorized to transact business in the State of Florida (hereinafter referred to as the Depository).The Borrower shall pay the Depository, for its services hereunder, fees as follows: _The Borrower and the Depository agree as follows:Article I - Scope of Escrow Agreement1. The Borrower shall establish and maintain two accounts with the Depository. These accounts shall be the Loan Debt Service Account and the Loan Repayment Reserve Account. The accounts shall be maintained separately as described herein.2. Words and terms used herein shall have the following meanings:(a) Agreement or Loan Agreement shall mean the agreement between the Department and the Borrower establishing the terms of the Loan, including provisions for repayment.(b) Department shall mean the Department of Environmental Protection.(c) “Escrow Agreement” shall mean this agreement for the establishment and maintenance of accounts between the Borrower and the Depository.(d) Loan shall mean the amount of money to be loaned pursuant to the Loan Agreement and subsequent amendments.(e) Loan Debt Service Account shall mean the escrowed account into which monthly deposits are to be made by the Borrower for the purpose of making Semiannual Loan Payments.(f) Loan Repayment Reserve Account shall mean the escrowed account into which will be deposited the amount set aside to pay temporary and unexpected deficiencies, if any, in the Semiannual Loan Payment.(g) “Monthly Loan Deposit” shall mean the monthly deposit to be made by the Borrower to the Loan Debt Service Account.(h) Semiannual Loan Payment shall mean the payment due under the Loan Agreement from the Borrower to the Department at six-month intervals, and it is comprised of principal and interest.3. This Escrow Agreement may be amended by mutual agreement of the Depository and the Borrower, but only with the prior written consent of the Department. The Depository shall not be bound by any notice of claim, or demand with respect thereto, or any waiver, modification, amendment, termination, or rescission of this Escrow Agreement, unless in writing received by it, and, if its duties, rights, powers or liability hereunder are affected, unless it shall have given its prior written consent thereto.Article II - General Provisions1. The Depository shall invest, at its own sole discretion, all escrowed moneys in any of the government obligations of the United States of America described in paragraphs (a) through (e) below.(a) Federal Securities;(b) Any bond, debenture, note or other similar obligation issued by the Government National Mortgage Association, Federal Land Depositories, Federal Home Loan Depositories, Federal Intermediate Credit Depositories, Depositories for Cooperatives, the Tennessee Valley Authority, or U.S. Department of Agriculture Rural Utilities Services;(c) All other obligations issued or unconditionally guaranteed as to principal and interest by an agency or person controlled or supervised by or acting as an instrumentality of the United States Government pursuant to authority granted by the Congress;(d) Repurchase of obligations or other investment agreements with a bank or trust company, having a combined capital and unimpaired surplus of not less than $50 million, authorized to transact commercial banking or savings and loan business in the State of Florida and insured by the Federal Deposit Insurance Corporation, fully secured by securities listed under paragraphs (a) through (c) above; and (e) Time deposits, certificates of deposit or similar arrangements with any bank or trust company which is a member of the Federal Deposit Insurance Corporation or any saving and loan association which is a member of the Federal Savings and Loan Insurance Corporation and which are fully secured by securities listed under paragraphs (a) through (c) above.2. All earnings from investment of moneys on deposit in the Loan Debt Service Account shall be credited to and deposited in said account and shall be used for repayment of the Loan. 3. All earnings from investment of moneys on deposit in the Loan Repayment Reserve Account shall be credited to and deposited in said account. 4. The Loan Debt Service Account and the Loan Repayment Reserve Account shall be maintained independent of one another. Funds shall not be pooled except for investment purposes.5. The maturity or redemption date of investments of Loan Debt Service Account moneys shall be not later than the date upon which such moneys will be required to make the Semiannual Loan Payments pursuant to Article III of this Escrow Agreement. 6. The maturity or redemption date of investments of Loan Repayment Reserve Account moneys shall be not later than the date set for the final Semiannual Loan Payment provided, however, that moneys must be available for withdrawal, if necessary, to cure a Semiannual Loan Payment deficiency pursuant to Article IV of this Escrow Agreement.7. All escrowed funds shall be trust funds and shall be applied in the manner and for the purposes set forth in this Escrow Agreement. The Department shall have a lien on all funds on deposit until such funds are applied as provided in this Escrow Agreement.8. The Borrower hereby assumes liability for, and hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to indemnify, protect, save, and hold harmless the Depository and its respective successors, assigns, agents, and servants, from and against expenses and disbursements (including legal fees and disbursements) of whatsoever kind and nature which may be imposed on, incurred by, or asserted against, at any time, the Depository (whether or not also indemnified against the same by the Borrower or any person under any agreement or instrument) and in any way relating to or arising out of the execution and delivery of this Escrow Agreement, the establishment of the Loan Debt Service Account, the Loan Repayment Reserve Account, the acceptance of the funds, and any payment, transfer or other application of funds by the Depository in accordance with the provisions of this Escrow Agreement; provided, however, that the Borrower shall not be required to indemnify the Depository against the Depositorys own gross negligence or misconduct. The Borrower agrees to indemnify and hold the Depository harmless from any liability on account of assessments or other governmental charges to which the Depository may be or become subject in connection with or which arises out of this Escrow Agreement. In no event shall the Borrower be liable to any person by reason of the transactions contemplated hereby other than to the Depository as set forth in this paragraph. The indemnities contained in this paragraph shall survive the termination of this Escrow Agreement.9. The Depository and its respective successors, assigns, agents, and servants shall not be held to any personal liability whatsoever, in tort, contract, or otherwise, in connection with the execution and delivery of this Escrow Agreement, the establishment of the Loan Debt Service Account, the Loan Repayment Reserve Account, the acceptance of the funds deposited therein, or any payment, transfer or other application of moneys by the Depository in accordance with the provisions of this Escrow Agreement or by reason of any non-negligent act, omission or error of the Depository made in good faith in the conduct of its duties. The Depository shall, however, be responsible for its gross negligence or willful failure to comply with its duties required hereunder, and its gross negligence or willful acts resulting in omissions or errors hereunder. In no event shall the Depository be liable for indirect, special or consequential damages.10. The Depository shall have no more or less responsibility or liability on account of any action or omission of any book-entry depository employed by the Depository than any such book-entry depository has to the Depository, except to the extent that such action or omission of any book-entry depository was caused by the Depositorys willful misconduct, gross negligence or bad faith.11. The duties and obligations of the Depository shall be determined by the express provisions of this Escrow Agreement, and the Depository shall not be responsible for any of the actions referred to in the Loan Agreement other than those specifically set forth in this Escrow Agreement. The Depository shall not be obligated to take any legal action hereunder which might, in its judgment, involve any expense or liability unless it shall have been furnished with acceptable indemnification. The Depository may rely on and shall be protected in acting or refraining from acting upon any written notice, instruction, instrument, statement, request or document furnished to it hereunder and believed by it to be genuine and to have been signed or presented by the proper person, and shall have no responsibility for determining the accuracy thereof.12. The Depository may be removed at any time for any breach of trust or for acting or proceeding in violation of, or for failing to act or proceed in accordance with, any provisions of this Escrow Agreement with respect to the duties and obligations of the Depository as the escrow holder by any court of competent jurisdiction upon the application of the Borrower.13. If at any time hereafter, the Depository shall resign after giving 90 days prior written notice of resignation to the Borrower and the Department, be removed, be dissolved, or otherwise become incapable of acting, or shall be taken over by any governmental official, agency, department or board, the position of the Depository as escrow holder shall thereupon become vacant. Prior to the effective date of resignation, as specified in such written notice, the Department will issue to the Depository a written instruction authorizing redelivery of the escrowed funds to a successor depository. No later than ten business days following its receipt of the instruction, the Depository shall pay to the successor Depository or to the Department, in accordance with said instructions, the amount specified. If the position of Depository as escrow holder shall become vacant for any reason, the Borrower shall appoint a successor depository as escrow holder to fill such vacancy. If no appointment of a successor escrow holder shall be made pursuant to the foregoing provisions of this paragraph, the Depository may apply to any court of competent jurisdiction to appoint a successor escrow holder. Such court may thereupon, as such court may deem proper, appoint a successor escrow holder.14. If any one or more of the covenants or agreements provided in this Escrow Agreement on the part of the Borrower or the Depository to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Escrow Agreement.15. This Escrow Agreement shall be construed under the laws of the State of Florida.16. This Escrow Agreement shall remain in full force and effect until the Borrower has met all the obligations required of it under the Loan Agreement and shall not be terminated or discontinued except as specifically provided for in this Escrow Agreement. 17. The Borrower shall promptly furnish, to the Department, two executed copies of this Escrow Agreement and any subsequent amendment. The Borrower shall promptly furnish, to the Depository, an executed copy of the Loan Agreement and any subsequent amendment. If the Depository reasonably requires other or further instruments in connection with this Escrow Agreement or obligations in respect hereto, the Borrower shall furnish such instruments.18. The Depository shall provide the Borrower with a monthly statement of account, identifying each sub account individually, indicating all investments made and transactions performed by the Depository. The Borrower shall have the duty to inspect such statements for apparent errors or any other irregularities. The Borrower shall give notice of such irregularity within 14 calendar days of receipt of such statement.19. All notices, consents, approvals, directions, and instructions required or permitted under this Escrow Agreement shall be effective when received and shall be given in writing and delivered either by hand or by registered or certified mail, postage prepaid, or by telegram or telecopier (with oral or written confirmation of receipt), to the Borrower , Depository, and Department at the addresses set forth below or to such other parties and addresses as they may hereafter designate.(a) To the Borrower : Name and address (b) To the Depository: _ _(c) To the Department: Bureau of Water Facilities Funding, Department of Environmental Protection, 2600 Blair Stone Road, MS 3505, Tallahassee, FL 32399-2400.Article III - Loan Debt Service Account1. The Borrower shall begin making Monthly Loan Deposits no later than the date set for such action in Section 10.03 of the Loan Agreement. Beginning six months prior to each Semiannual Loan Payment, the Local Government shall make six Monthly Loan Deposits. The first five deposits each shall be at least equal to one-sixth of the Semiannual Loan Payment. The sixth Monthly Loan Deposit shall be at least equal to the amount required to make the total on deposit in the Loan Debt Service Account equal to the Semiannual Loan Payment amount, taking into consideration investment earnings credited to the account.2. In the event the Borrower fails to make any Monthly Loan Deposit as required under paragraph 1 above, the Depository shall promptly notify the Department in writing.3. The Depository shall withdraw funds from the Loan Debt Service Account and make the Semiannual Loan Payments to the Department in accordance with the repayment schedule set forth in Section 10.06 of the Loan Agreement. Funds shall be transferred by electronic means. 4. The Semiannual Loan Payment amount stated in Section 10.06 is expected to be adjusted by amendment to the Loan Agreement. After the final disbursement of Loan proceeds, the Semiannual Loan Payment will be based upon the actual project costs and actual dates and amounts of disbursements after adjustment for any overpayment, or underpayment, associated with previous Semiannual Loan Payments. Actual project costs will be established after the Departments inspection of the completed project and associated records5. The withdrawal of moneys from the Loan Debt Service Account shall be for the sole purpose of making Semiannual Loan Payments or for discharging the Borrowers obligations pursuant to Section 8.01 of the Loan Agreement. The Depository shall immediately notify the Department upon any withdrawal from the Loan Debt Service Acc