HomeMy WebLinkAboutCity Council Resolutions (R-91-728)-12/17/1991
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RESOLUTION R-91-728
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A RESOLUTION AUTHORIZING
THE TEXAS STATE TREASURY TO
SAFEKEEP SECURITY PURCHASES
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WHEREAS, the City of Colleyville, an agency or political
subdivision of the state of Texas (the "Customer"), from
time to time, purchases book-entry securities for its own
investment portfolio that are eligible for deposit at a
Federal Reserve Bank and desires to have them safekept
(the "Portfolio Securities") by the Texas Treasury
Safekeeping Trust Company (the "Trust Company"); and
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WHEREAS, the Customer is authorized to contract with the Trust
Company to safekeep the Customer's Portfolio securities;
and
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WHEREAS, the Trust Company desires to serve as the custodian of
the Customer's Portfolio Securities; and
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WHEREAS, TEXAS GOVERNMENT CODE ANN. 404.103 authorizes the Trust
Company to enter into a custodian agreement with the
Customer;
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NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS:
Sec. 1
That the City of Colleyville authorizes the Trust Company
to establish a custodial account for the purpose of
maintaining custody of the Customer's Portfolio
Securities purchased for the Customer's own investment
portfolio (the "Portfolio Account") and all proceeds of
the maturing Portfolio Securities paid into the Portfolio
Account subject to the control of and upon written
instruction by the Customer. The Trust Company is
further authorized to receive and deposit all interest
earned on the Portfolio Securities into the Customer's
Portfolio Account unless directed otherwise by the
Customer.
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Sec. 2
That the following individuals whose signatures appear
below are officers or employees of the Customer and each
are hereby authorized to issue letters of instruction to
deposit to, withdraw from and substitute Portfolio
Securities in the Portfolio Account upon written
instruction and each are further authorized to withdraw
funds from time to time from the Portfolio Account:
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Sec. 3
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PAGE 2 OF 2 - RESOLUTION R-91-728
AGREEMENT FOLLOWS (7 PAGES)
Name: Dave Draz, Assistant City Manager
signatur:'}~l~ 9:5 /Jr .
Name: Terry Leake, Finance Director
That this e olution and its authorization shall continue
in full force and effect until amended or revoked by the
Customer and until the Trust Company receives a copy of
any such amendment or revocation, until such time the
Trust Company is entitled to rely on same.
8 AND IT IS SO RESOLVED.
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:nssed by a vote of
~~A~ , 1991.
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to
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ATTEST: ~~
Harris, CMC
Secretary
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CITY OF COLLEYVILLE
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CHRIS HAWKINS
MAYOR
ATTACHMENT TO RESOLUTION R-91-728
(7 PAGES)
CUSTODIAN AGREEMENT
PORTFOLIO ACCOUNT
TEXAS TREASURY SAFEKEEPING TRUST COMPANY
This custodian agreement (the "Agreement") is etltered into
this 17 day of December ' 1991 by and between the Texas
Treasury Safekeeping Trust Company (the "Trust Company") and
City of C01 h~,y\.';l1Q a political subdivision of the State of
Texas (the customer").
WITNESSETH
WHEREAS, from time to time the Customer purchases book-entry
securities for its own investment portfolio that are eligible for
deposit at a federal reserve bank and desires to have them
safekept ("portfolio Securities"); and
WHEREAS, the Trust Company desires to serve as the custodian
of Portfolio Securities belonging to the Customer;
NOW THEREFORE, in consideration of the foregoing and of the
mutual covenants contained herein, it is hereby agreed as follows:
ARTICLE I.
APPOINTMENT OF CUSTODIAN AND CREATION OF ACCOUNTS
1.1 The portfolio Account. The Customer hereby authorizes
the Trust Company to establish a custodial account for all
portfolio Securities that are purchased for the Customer's own
investment portfolio (the "Portfolio Account"). The Portfolio
Account shall be an identifiable trust account which is not
transferable or assignable. The Trust Company shall at all times
segregate the Portfolio Securities kept as part of the Portfolio
Account from all other securities or other property owned or held
by the Trust Company by identifying the portfolio Securities in the
Portfolio Account under an appropriate pledge code or notation on
the records of the Trust Company. For purposes of this Agreement
such pledge code or notation shall be , and a
confirmation receipt shall be issued by the Trust Company to the
Customer reflecting such safekeeping information.
1.2 Appointment. The Customer hereby constitutes and
appoints the Trust Company as its agent for maintaining custody of
all Portfolio Securities and all proceeds of maturing Portfolio
Securities paid into the Portfolio Account to be safekept on behalf
of the Customer.
ARTICLE 2.
DUTIES OF THE TRUST COMPANY
2.1 Proceeds of Maturing Portfolio Securities. The Trust
Company shall take possession of all proceeds of maturing portfolio
Securities in the Customer's Portfolio Account and shall hold such
proceeds in trust 'for the Customer.
2.2 Interest earned on portfolio Securities. Interest earned
on portfolio Securities may be received by the Trust Company and
shall thereafter be promptly deposited into the Customer's
Portfolio Account unless directed otherwise by the Customer.
2.3 Confirmation Receipts. The Trust Company shall issue to
the Customer a confirmation receipt in the form attached here as
Exhibit A (the "Confirmation Receipt") for all portfolio Securities
deposited into the Customer's Portfolio Account.
2.4 Control of Portfolio Securities. The Trust Company shall
hold the Portfolio Securities subject to the control of the
Customer and shall surrender each and all of the portfolio
Securities pursuant to the Customer's instructions.
2.5 No Encumbrance by Trust Company of Portfolio Securities.
The Trust Company shall not pledge, hypothecate, or encumber in any
manner any of the Portfolio Securities held by the Trust Company
pursuant to this Agreement, nor shall the Trust Company be
permitted to use such Portfolio Securities for its own benefit.
ARTICLE 3.
PROCEDURES FOR DEPOSIT, WITHDRAWAL AND SUBSTITUTION
OF PORTFOLIO SECURITIES
3.1 Customer I s Procedures. The Trust Company agrees to
comply with all the Customer's reasonable procedures related to the
deposit and withdrawal of Portfolio Securities. Such procedures on
behalf of any the Customer shall be governed by state law and
instructions tendered by the Customer to the Trust Company.
3.2 written Instructions Required. All authorizations and
instructions referred to in this Agreement shall mean those
instructions that are in writing and executed by an authorized
representative of the Customer as set forth in Section 5.1 hereof.
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In lieu of written instructions the Customer shall fax instructions
for receipt or delivery of Portfolio Securities which must be
followed by written instructions. All instructions must reference
the Customer's Portfolio Account and uni'que pledge code.
Instructions must be received no later than 10:00 a.m. on the day
of settlement. For purchases and sales of portfolio Securities
contained in the Customer · s Portfolio Account, the term
"instructions" may include oral instructions or instructions using
the Trust Company's data processing system; however all such
instructions must reference the Customer's Portfolio Account and
unique pledge code, and all such instructions shall be confirmed by
the Trust Company by means of a written transaction confirmation
mailed no later than one (1) business day after settlement day.
The transaction confirmation shall be presumed to be correct as to
the contents thereof unless the Customer delivers written
objections to the Trust Company within 30 days after receipt of
the transaction confirmation.
3.3 Delivery Versus Payment for Trades of Portfolio
Securities. All purchases and sales of Portfolio Securities will
be settled on a delivery versus payment basis. The Trust Company
will not be able to complete a purchase of portfolio Securities
based on instructions which are not received before 10:00 a.m. on
the day of settlement via fed wire or against the Customer's
TexPool account, or for which there is not sufficient payment
available for purchase of the Portfolio Securities.
3.4 Written Confirmation of Portfolio Securities. The
Customer reserves the right to require prior to the deposit or
withdrawal of any Portfolio Securities written confirmation by the
Trust Company of the identity, amount and maturity date of all
Portfolio Securities contained in the Customer's Portfolio Account.
ARTICLE 4.
EXAMINATION AND REPORTS
4. 1 Records Required and Monthly Reports. The Trus t Company
shall keep accurate and detailed records of all Portfolio
Securi ties in the Customer · s Portfolio Account and all transactions
related to Portfolio Securities. At the end of each calendar month
the Trust Company will deliver a statement to the Customer
containing an inventory of Portfolio Securities in the Customer's
Portfolio Account and details of each transaction, including an
invoice reflecting fees deducted for services provided pursuant to
Article 6 herein.
4.2 Examination during Business Hours. All records of the
Trust Company related to the Customer's Portfolio Account are
subject to examination and verification by the Customer at all
reasonable times during the normal business hours.
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4.3 Auditors. All Portfolio Securities and all records of
the Trust Company related to Portfolio Securities shall be
regularly examined and verified by the Trust Company's internal
auditors, any external auditors hired to audit'the Trust Company,
and the state auditors.
4.4 Open Records. The Trust Company will attempt to keep
confidential all historical information and current statements of
Portfolio Securities pertaining to the Customer's Portfolio
Account. However, the Customer acknowledges that the Trust Company
is subject to the Open Records Act, Tex. Rev. Civ. Stat. Ann. art.
6252-17a (Vernon Supp. 1990), as amended.
ARTICLE 5.
AUTHORIZED REPRESENTATIVES
5.1 Current Resolutions Required. The Trust Company and the
Customer shall each provide to the other a duly executed resolution
containing the names, titles, and signatures of officers or
employees authorized to execute documents and tender instructions
under this Agreement on behalf of the Trust Company and the
Customer. Such current resolutions of the Customer and the Trust
Company are attached hereto as Exhibits Band C respectively. The
Trust Company shall be entitled to rely on instructions tendered by
an authorized representative named in the Customer's resolution
until and unless a new resolution is submitted to the Trust
Company.
ARTICLE 6.
FEES
6.1 Fees for Services. The Trust Company shall charge a fee
for each purchase, sale, receipt or delivery of Portfolio
Securities of Ten Dollars ($10.00) per transaction. Additionally,
each of the Portfolio Securities identified by a separate CUSIP
number on deposit at the Trust Company in the Customer's Portfolio
Account at the end of the calendar month will be assessed a One
Dollar ($1.00) safekeeping fee. The Customer hereby authorizes the
Trust Company to deduct all fees from the Customer 's, Portfolio
Account after settlement of all Portfolio Securities at the end of
each calendar month. The monthly report described in Article 4
hereof shall set forth all these charges and reflect the deduction
of fees for cost of services. This fee schedule shall remain in
full force and effect until notice of an amended fee schedule is
sent which shall become effective automatically upon the expiration
of thirty (30) days thereafter unless the Customer tenders an
objection in writing within the same thirty (30) days time.
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ARTICLE 7.
FAILED TRANSACTIONS
7.1 Failed Trades. In the event that there is a transaction
that fails to settle by 2:00 p.m. because the other party to the
transaction failed to execute the required trade, the Trust Company
will notify the Customer on the day the trade was due to settle.
The Trust Company will then await instructions by the Customer to
the Trust Company. If a purchase of securities by the Customer
fails to settle, the Trust Company will use its best efforts to
reinvest those monies as directed by the Customer. However, if the
failed trade occurs after 2:00 p.m. the Customer hereby
acknowledges that frequently late day investments are made at a
lower interest rate yield, and agrees that the Trust Company will
use its best efforts to purchase the highest interest rate yielding
instrument available at the time. If a buyer of the Customer's
Portfolio Securities fails to pay upon delivery of the Portfolio
Securities and the trade thereby fails, the Customer hereby agrees
to pay to the Trust Company an amount equal to the Texas Local
Government Investment Pool's (ITeXPool") daily interest rate
multiplied by the amount of the failed transaction, as compensation
therefore.
7.2 Trades without Instructions. In the event that any
Portfolio Securities arrive at the Trust Company's account at the
Federal Reserve Bank without the Customer's instructions having
been received by the Trust Company, the Trust Company will not
accept the Portfolio Security and it will be returned to the
sender. The Trust Company will then call the Customer to obtain
further instructions. If the Customer confirms a failed trade
before the fed security wire closes, and subsequently on the same
day the Portfolio Security is delivered, the Trust Company will
return the Portfolio Security to the sender if sufficient funds are
not available to make the payment. Portfolio Securities can be
redelivered to the Trust Company on the following business day,
pursuant to instructions by the Customers.
ARTICLE 8.
LIABILITY
8.1 Trust Company Liable for Portfolio Securities. The Trust
Company's sole liability shall be for any loss of the Portfolio
Securities or proceeds of maturing Portfolio Securities resulting
from any action taken or omitted to be taken by the Trust Company,
other than actions taken upon the instructions from the Customer.
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ARTICLE 9.
TERMINATION
9.1 Termination by Either Party. Either party to this
Agreement may terminate this Agreement at any time upon thirty (30)
days prior written notice to the other, provided however, that this
Agreement shall continue for such time as may be necessary for the
Trust Company to complete any and all transactions ordered by the
Customer or to deliver to the Customer any and all portfolio
Securities demanded by the Customer.
ARTICLE 10.
NOTICES
10.1 Notices. Any notice hereunder including all written
instructions shall be delivered to the parties at the addresses as
set out below:
To the Trust Company:
Texas Treasury Safekeeping Trust Company
Attn: Oscar Ramirez
2028 E. Ben White Blvd., Suite 550
Austin, Texas 78741
Telephone: 5l2/440-4740
Fax No.: 512/440-4749
To the Customer:
City of Colleyville
P.O. Box 185
Colleyville, Tx 76034
Attn: Terry"leake
Phone: (817) 281-4044
Fax: (817) 581-2191
ARTICLE II.
ASSIGNMENT
11.1 No Assignment. This Agreement may not be assigned or
transferred without the prior written consent of the parties
hereto.
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ARTICLE 12.
M.ISCELLANEOUS
12.1 Governing Law. This Agreement is governed by and shall
be construed under the laws of the State of Texas and venue shall
be in Travis County, Texas.
12.2 Amendment. This Agreement may be amended only by the
written instrument executed by both parties hereto.
12.3 M.ultiple Originals. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an
original but such counterparts shall, together, constitute only one
instrument.
12.4 No Trust Created. This Agreement shall not be implied or
be construed to mean that the Trust Company is acting as Trustee
with full trust powers and responsibilities under the Texas Trust
Code. While, the Trust Company I s only obligation under this
Agreement shall be to hold the Portfolio Securities in the
Customer's portfolio Account and to execute instructions as
provided for in this Agreement, the Trust Company shall perform
these duties exercising the same degree of care required for the
management of funds belonging to the State of Texas.
IN WITNESS WHEREOF the parties hereto have executed this
Agreement in mul tiple counterparts on the ~ day of
])EteIW.Rl!Je.., , 1991.
TEXAS TREASURY SAFEKEEPING TRUST COMPANY
By:
Title:
CUSTOMER
By: ~~r~~~-
Title. ~tI-1
PORT-ACC.AGR
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