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R-92-1710 - 4/9/1992RSO4092C RESOLUTION NO. ! 7 /0 iU WHEREAS, the City of Round Rock, Texas a 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 WHEREAS, the Customer is authorized to contract with the Trust Company to safekeep the Customer's Portfolio Securities; and WHEREAS, the Trust Company desires to serve as the custodian of the Customer's Portfolio Securities; and WHEREAS, TEX. GOVT CODE ANN. §404.103 authorizes the Trust Company to enter into a custodian agreement with the Customer; NOW THEREFORE, be it resolved as follows: 1. That the City of Round Rock 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. 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: ATTEST: DAVID 1 TZ Signature: D 7.0 •- Name: J G& y C LLC LC)f / Title: ASSISTA/b'r F viovtF DIREGJ Signature: Al=z/ b Name: DCNN( -1 AO C2UZ Title: ACCOUNT-N(1, f - lAMAgE ' 1 Signature: � J x (Ai / / %k 3. That this Resolution 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. Name: This Resolution is hereby introduced and adopted by the Customer at its regular meeting held on the 9th day of April, 1992. LAND, Secretary 2. Title: WO_TOQ GF F /Nfn1CG MIKE ROBINSON, Mayor City of Round Rock, Texas Th s custodian) this day of LLD?h.IXJ Tr asur Safekeepi g Texas (the "Customer' CUSTODIAN AGREEMENT PORTFOLIO ACCOUNT TEXAS TREASURY SAFEKEEPING TRUST COMPANY agreement (the "Agreement ") is entered into 1994. by and between the Texas n Trust Company (the "Trust Company ") and a political subdivision of the State ') WITNESSETH of 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 1. 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 p this Agreement a n such pledge code or notation shall be otil `1 U, 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'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. 2 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 unique 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 rode, 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 Trust Company shall keep accurate and detailed records of all Portfolio Securities 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. 3 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 B and 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. 4 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 ("TexPOOl ") 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. 5 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. To 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: 512/440 -4740 Fax No.: 512/440 -4749 ARTICLE 11. ASSIGNMENT 11.1 No Assignment. This Agreement may not be assigned or transferred without the prior written consent of the parties hereto. 6 ARTICLE 12. MISCELLANEOUS 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 Multiple 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'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 multiple counterparts on the day of , 1992. TEXAS TREASURY SAFEKEEPING TRUST COMPANY By: Title: CUSTOMER By: 7R4 Title: PORT - ACC.AGR 7 DATE: April 7, 1992 SUBJECT: City Council Meeting, April 9, 1992 ITEM: 9.C. Consider a resolution authorizing the Mayor to enter into an agreement with Texas Treasury Safekeeping Trust Company for the safekeeping of investment portfolio securities. STAFF RESOURCE PERSON: David Kautz STAFF RECOMMENDATION: The City invests a significant portion of its cash balances with the State Treasury (Tex pool). Periodically, in order to diversify the City's portfolio or to improve average yield, funds may be transferred from Texpool to purchase U.S. Government Treasury Securities or Agency Securities. When such transactions take place, the City's investment policy requires an independent, third party institution to safekeep the records of the transactions. The state treasury, for the convenience of its local government customers, has set up this independent safekeeping company. The fees are cheaper than a bank, security is not compromised and the state treasurer oversees the operation. STAFF RECOMMENDATION: Staff recommends providing this option to the City by approving the attached agreement. a, • ■. ' • Mayor Mike Robinson Mayor Pro-tem Charles Culpepper Council Members Robert Sttuke Tish Oalnan Rick Steuart Earl Palmer Jtmtnrl Joseph City Manager Robert L Emmett, Jr City Attorney .Stephan L Sheers THE CITY OF ROUND ROCK 221 East Main Street Round Rock, Texas 78664 • 512- 255 -3612 Fax 512- 255 -6676 Texas Treasury Department P.O. Box 12608, Capitol Station . Austin, Texas 78711 ' Gentlemen: - City of Round Rock, Texas Christine Martinez 221 E. Main Street Round Rock, Texas 78664 Sincerely, 00kita Donna Bohn Cruz - edo Accounting Manager WP20171 Fhclosed please find two (2) original resolutions authorizing TexPool to open a Portfolio Account on behalf of the City of Round Rock, Texas. Please date and sign both documents and mail the City's original copy back to: Please contact me if there are any problems or questions with this request. My number is 255 -3612 ext. 212.