R99-161RESOLU-f~ON NO. R99-/~/
A RESOLUTION OF THE CITY COMMISSION OF THE CITY
OF BOYNTON BEACH, FLORIDA, AUTHORIZING AND
APPROVING A CONSTRUCT[ON SURETY ESCROW
AGREEMENT BETVVEEN THE CI-I-Y OF BOYNTON BEACH
AND EB DEVELOPERS, INC., AND KODSI & EISENSTE'rN,
P.A., (ESCROW AGENTS) FOR THE CONSTRUCT[ON OF
KNUTH ROAD; AUTHORIZING AND DIRECTING THE
MAYOR AND CiTY CLERK TO EXECUTE SAID
AGREEMENT; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City Commission, upon recommendation of staff, has
deemed it to be in the best interests of the citizens and residents of the City of
Boynton Beach to enter into an Escrow Agreement bet~veen the City, EB Developers,
Inc., and Kodsi & Eisenstein, P.A. as escrow agents, for the construction of Knuth
Road;
NOW, THEREFORE, BE 'rT RESOLVED BY THE CTTY COI~IHI'SSi'ON OF
THE CZTY OF BOYNTON BEACH, FLORZDA, THAT:
Section 1. The City Commission of the City of Boynton Beach, Florida does
hereby authorize and approve a Construction Surety Escrow Agreement bebNeen the
City of Boynton Beach, EB Developers, Inc., and Kodsi & Eisenstein, P.A., Escrow
Agents, a copy of which Agreement is attached hereto as Exhibit "A".
Section 2. The Mayor and City Clerk are authorized and directed to execute
said Agreement.
Section 3. This Resolution shall become effective immediately upon
passage.
PASSED AND ADOPTED this
CT]-Y Q OYNT N EA , FLOR[DA
Vice/IVlayo' r / ~
lVlayor Pro Tem
Commiss' net ~. ~ .~
C~mmissioner
day of December, 1999.
KNUTH ROAD CONSTRUCTION SURETY7 ESCROW AGREEMENT
This Escrow Agreement is made and e~ntered into this day of
, 1999, by and amo~ng, EB Developers, Inc.
"Developer"), the City of Boynton Bea¢uh, Boynton Beach, Florid~
("~ity") and Kodsi & Eisenstein, P.A. ("Escrow Agent").
RECITALS
A. City has mandated that Knuth Road be constructed from its
present terminus south of Boynton Beach Boulevard so as to connect
with Woolbright Road.
B. Developer is the owner of a p~arcel of land which fronts
o~. the proposed extension of Knuth Road and on which the Developer
isI constructing a rental apartment proje~ct to be known as "Belmont"
("~eveloper Property"), as described on~ Exhibit "A".
C. The City of Boynton Beach has ]imposed upon the Developer
Prpperty the obligation to construct Knu~.th Road from the south side
of~the Lake Worth Drainage District L-L-5 Canal to and to connect
wi~h Woolbright Road.
D. Palm Beach County has approve~d certain portions of the
construction of Knuth Road and certain related improvements for
credit against traffic impact fees which would otherwise be payable
ini conjunction with the development of the Developer Property.
, E. Applicable regulations of the City require that prior to
commencement of construction of the ro~d, suitable bond or other:
surety must be established to insure co~mpletion of construction.
F. In accordance with applicable regulations of the City,
tie execution of this Agreement and the payment into escrow of the
f%nds contemplated hereby in accordance herewith shall serve
ccnstitute compliance with the City's ]bonding/surety requirement
with respect to the construction of Knmth Road.
~ G. Developer intends to enter imto a contract with R van
I~corporated, Inc.("Contractor") for tihe construction of Knuth
Rolad, a copy of which Contract is attaclhed hereto as Exhibit "C".
~ H. The parties have agreed to e~ter into this Agreement to
coDfirm (i) that the delivery of the Es,crowed Funds to the Escrow
A~ent shall satisfy the condition and requirement of the City of
Boynton Beach for bonding the construct~ion of the road; and' (ii)
th~ terms and conditions under which t~e Escrow Agent shall hold
an~ disburse the Escrowed Funds.
I NOW, THEREFORE, in consideratiom of the covenants and
conditions herein contained and or,her good and valuable
consideration, the receipt and sufficLency of which are hereby
acknowledged, the parties agree as foll¢ows:
Page ~ of ~
1. Recitals. The Recitals set forth above are true and
correct.
2. Satisfaction of Condition. The City acknowledges that
the requirement .that a bond or other surety be posted with respect
to the construction of Knuth Road shall be deemed satisfied by the
payment to the Escrow Agent of the Esc~rowed Funds in accordance
with the terms of this Agreement.
3. Delivery of Escrowed Funds.. Escrow Agent hereby
acgnowledges that Developer has deliver~ed to Escrow Agent the sum
ofi $ 434,605.98 representing one hun~dred ten (110%) percent of
th~ costs of construction of Knuth R~oad as evidenced by the
Contract ("Escrowed Funds").
4. Disbursement of Escrowed Fundgs. The Escrow Agent shall
ho[d the Escrowed Funds in escrow and shLall disburse them strictly
inlaccordance with the following:
i A. The Contractor shall submit draw requests
simultaneously to Escrow Agent and the Development Department at
th~ City of Boynton Beach and such draw z~equests s~all.be in a form
acceptable to the City and shall itemize the work for which payment
islbeing requested.
B. The City shall cause the work for which payment i~
!
being sought to be inspected. If the w~ork is unacceptable to the
City, the City shall so advise the Comtractor, in writing, via
facsimile, with a copy to Escrow Agent and it shall be incumbent
upQn Contractor to make the necessary co~rrections or modifications
to,he work without additional charge.~
C. When the inspector approv~es the work, the inspector
sh
Co
Ci
th
re
all, via facsimile, to Escrow Agent and Contractor forward to
~tractor and Escrow Agent a copy of the Draw Request on which the
ty's inspector's approval has been noted and Escrow Agent shall,
ereupon, disburse to Contractor nineety (90%) percent of the '
uested paYment.
D. Upon full and final compJtetion of the construction
Knuth Road and the approval and acceptance thereof by an
appropriate representative of the Devel<opment Department, City of
BQynton Beach and written confirmation of same has been provided to
EsDrow Agent. Escrow Agent shall, there~upon, be authorized to pa~
t~Contractor any amounts due and owing under the final draw
requests, together with the undisbu~rsed ten (10%) percent
renainage.
E. Should Contractor fail orr refuse to construct Knuth
Read in accordance with the requirements of applicable governmental
authority or the Contract or otherwise <default in its performance
urder the Contract, Contractor shall not be entitled to any
disbursement of the Escrowed Funds s~o long as it remains in
d~fault. By execution of this Agreement, Contractor acknowledges
Page 2 of 8
that it has no interest in, lien agains't or claim to the Escrowed
Funds, that the funds have been escrowed solely as the result of
the City's requirements with respectl thereto and that this
Agreement does not impose any contractuel or other obligation upon
the City in favor of Contractor.
F. Should the Contract be terminated or the
construction of Knuth Road not be completed to the reasonable
saltisfaction of the City's Development Department on or before
February 1, 2000(the "Con~pletion Date"), City ma~
c~se Knuth Road to be completed utili zing and applying the, as
a~propriate, Escrowed Funds without further consent or approval
fr~m Developer.
.~ 5. Disbursement Subsequent to Completion Date. In the event
coinstruction ef Knuth Road is not complected by the Completion Date,
t~e City may either (i) agree to extend the Completion Date, or
(ii) complete construction by either utillizing City employees or an
ouitside contractor. If the City elects option {ii), the Escrow
Agent is hereby authorized to disburse hhe balance of the Escrowed
Funds to the City. Notwithstanding thee decision of the City to
ex rcise
~ option (ii), Developer agree~s that in the event the
Eslcrowed Funds are insufficient to colI~iplete construction, within
fi~e (5) business days after written request they shall provide the
City with any additional funds reasonably necessary to complete
cohstruction of Knuth Road. Additio}nally, in the event the
Eshrowed Funds for Knuth Road exceed the construction cost the City
agrees to refund the difference to Dove.loper as appropriate.
6. General Escrow Provisions.
A. Escrow Agent shall deposit the Escrowed Funds in an
interest bearing escrow account. The interest earned shall be
deemed part of the Escrowed Funds.
B. Escrow Agent shall not b~e deemed to have knowledge
oflany matter or thing unless and until Escrow Agent has actually
received written notice of such matter or thing and Escrow Agent
shall not be charged with any constructive notice whatsoever.
C. Escrow Agent's resporlsibilities are purely
mihisterial in nature. Any reduction in the market value of the
Esdrowed Funds while deposited with Esc~row Agent shall be at the
sole risk of the party having deposited the Escrowed Funds with
Es(
Fu]
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of
de~
de~
un~
fur
the
:row Agent. Escrow Agent has no dut~y to invest the Escrowed
~ds except as provided herein. Escrow Agent shall have no
bility in the event of any insolvency ,of any depository, failure
any depository to pay interest or other earnings on sums
osited or should such depository fail, or refuse to release sums
osited or delay in the release or disbursement of same, it being
erstood that Escrow Agent's sole obli[gation is to deposit the
ds in an interest bearing account and to authorize disbursement
refrom in accordance with the provisi(ons hereof.
Page 3 of 8
D. In the event Escrow Agent shall be uncertain as to
its duties or rights hereunder or sba]il receive instructions,
claims or demands from the City or Developer with respect to the
Escrowed Funds or any other sums or t?~ings which may be held
hereunder, which, in its sole opinion, are in conflict with any
provision of this Agreement, Escrow Age~nt shall be entitled to
refrain from taking any action until it shall be directed otherwise
in writing by the City, and Developer or by a final order or
judgment of a court of competent jurisdiction.
E. It is agreed that the dut5ies of Escrow Agent are
purely ministerial in nature and shall be, expressly limited to the
safekeeping of the Escrowed Funds or d~eposit of same into the
account hereinafter specified and for the disposition of same in
accordance with this Agreement. DeveLoper hereby indemnifies
Escrow Agent and hold it harmless from and against any and all
clailms, liabilities, damages, costs, pen~alties, losses, actions,
suits or proceedings at law or in equity, or any other expenses,
feesi or charges of any character or natur'e, which it may incur or
wit~ which it may be threatened, whether directly or indirectly
arising from or in any way connected with this Agreement, or which
may iresult from Escrow Agent's followimg of instructions from
De~e%oper or the City, and in connectionl therewith, indemnifies
EscrOw Agent against any and all expenses, including attorneys'
feesland the cost of defending any action:, suit, or proceeding or
resisting any such claim, whether or not ~itigation is instituted.
F. It is further agreed that Escsrow Agent shall have the
righ~ to utilize the services of any otk~er law firm selected by
EscrOw Agent, as its attorney and same sh~all not affect or in any
way ~rejudice or limit Escrow Agent's entitlement to reasonable
attorneys' fees for the services of such a~ttorneys as set forth in
this!Agreement.
G. In the event Escrow Agent i_s joined as a party to a
lawsuit by virtue of the fact that it is holding the Escrowed
Funds, Escrow Agent shall tender the Escrow~ed Funds to the registry
of t]~e appropriate court.
H. In the event of a dispute regarding retention or
disbursement of the Escrowed Funds, the Developer, or the City may
init~.ate an action demanding interpleader. The Escrow Agent shall
not initiate any interpleader or similar action. In the event
Escr(~w Agent tenders the Escrowed Funds to the registry of the
appr,~priate court, Escrow Agent shall be released and relieved from
any and all further obligation and lia~oility hereunder or in
connection herewith.
I. This Escrow Agreement shall remain in effect unless
and [ntil it is canceled in any of the following manners:
(1) Escrow Agent may resigin as Escrow Agent at any
time,pon giving notice to the City and Developer of its desire to
so resign; provided, however, that resig[nation of Escrow Agent
Page 4 of 8
shall take effect no earlier than ten (10) days after the giving of
.notice of resignation; or
(2) Upon compliance with ~all escrow provisions as
~ set forth in this Agreement.
J. In the event the City, and Developer fail to agree
to a successor escrow agent within the period described
hereSnabove, Escrow Agent shall have the right to deposit all of
the !Escrowed Funds held hereunder .int~o the registry of an
appropriate court and request judicial det,ermination of the rights
of ~he parties by interpleader or other appropriate action,
Developer hereby indemnifies and holds Es¢~row Agent harmless from
and !against any damages or losses im connection therewith
including, but not limited to, reasonable a~ttorneys' fees and court
costsi at all trial and appellate levels.
K. Upon termination of the du~ties of Escrow Agent in
eithe~ manner set forth in subparagraph i of this Section, Escrow
Agent! shall deliver all of the Escrowe~d Funds to the newly
appointed escrow agent designated by the u~arties.
Page 5 of 8
L. Ail notices, certificate~, requests, demandS,
materials and other communications hereundier shall be in writing
and deemed to have been duly given (1) upou~ delivery by and to the
appropriate address of Developer, the City or Escrow Agent as set
· forth~in this Agreement or (2) on the third business day after
mailing by United. States registered or ¢uertified mail, return
receipt requested, postage prepaid to suchL address. Ail notices
hereunder shall be addressed to the resp,ective parties at the
following addresses:
For Escrow Agent:
KODSI & EISENSTEIN, P.A.
701 w. CYPRESS CREEK ROAD,
FORT LAUDERDALE, FL 33076
SUITE 302
~or Developer:
THE BELMONT AT BOYNTON BEACH,
ATTENTION: PrR. ELIE BERDUGO
7025 BERACASA WAY, SUITE 107
BOCA RATON, FLORIDA 33433
F6r the City:
INC '..
THE CITY OF BOYNTON BEACH
c/o CITY ATTORNEY'S OFFICE
P. O. BOX 310
BOYNTON BEACH, FL 33425-0310
' ~ 7!. Choice of Law. This Agreement shall be governed by and
construed in accordance with the laws of thee State of Florida.
8i Binding Agreement. This Agreement~ shall be binding upon
the pa~ties hereto and their respective succ~essors and/or assigns.
9 .i Counterparts. This Agreement ~ay be executed in
counterparts and all counterparts taken tog~ether shall be deemed
same instrument.
one an~ the
Id WITNESS WHEREOF, the parties have ex~ecuted this Agreement
the day! and year first above written.
CITY OF BO~TOIN .BEACh, FLORIDA
Print Name of tPerson Signing
Its:
Page 6 of 8
.... ( E$CRO~ AGENT
Print ~' .....
~'~c~ie of ~erson Sigi~ihg
Its:
By:
Print u-~
~.~e Person Signing
its:
Joined in and consented to by:
RY~ T~ ^~ ~
*~ORP~B~_!ED, INC.
(CONTRACTOR)
Print Name of Person Signing
Facsimile Cover Page
CompenZ:. City of Boy,on _Beach i Date:. November 23, '"""
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