Loading...
Res 03-29 Authorizing a Depository Agreement with Frost National BankTOWN OF WESTLAKE RESOLUTION NO. 03-29 A RESOLUTION OF THE BOARD OF ALDERMEN OF THE TOWN OF WESTLAKE, TEXAS, AUTHORIZING THE TOWN MANAGER TO ENTER INTO A DEPOSITORY AGREEMENT WITH FROST NATIONAL BANK. BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE TOWN OF WESTLAKE, TEXAS: SECTION 1: The Board of Aldermen of the Town of Westlake does hereby authorize the Town Manager to enter into a depository agreement with Frost National Bank as attached here as Exhibit A. SECTION 2: This Resolution shall become effective upon the date of its passage. PASSED AND APPROVED ON THIS 9TH DAY OF JUNE 2003. ATTEST: . Ao UingeO Crosswy, Town S'Qcretary APPROVED AS TO FORM: Scott Bradley, Mayor Trent O. Petty, Tyjlr anager THE STATE OF TEXAS COUNTY OF BEXAR BANK DEPOSITORY AGREEMENT THIS AGREEMENT is made and entered into on the date last herein written by and between the Town of Westlake, Texas hereinafter called 'DEPOSITOR," and The Frost National Bank, a national banking association, duly incorporated and authorized by law to do banking business in the State of Texas and now carrying on such business in said State, hereinafter call 'DEPOSITORY". DEPOSITOR hereby designates DEPOSITORY as a depository for the period beginning May 15, 2003, and continuing until this agreement has been cancelled in accordance with its provisions, for certain accounts in the name of the Town of Westlake which accounts shall be opened by the DEPOSITOR designating the accounts and making deposits herein and the DEPOSITORY accepting said deposits. II. DEPOSITOR shall deposit such of its funds as it may choose, and DEPOSITORY shall receive such deposits, on 'Demand Deposit(s)," "Interest Bearing Transaction Account," "Savings Account," "Time Deposit(s), Open Account" and/or on "Time Certificate(s) of Deposit," as designated by DEPOSITOR, and shall hold said 'Demand Deposit(s)," "Interest Bearing Transaction Account," "Savings Account," "Time Deposit(s), Open Account' and/or "Time Certificate(s) of Deposit' subject to payment in accordance with the terms of the deposit. DEPOSITORY will allow, credit, and pay interest on such "Interest Bearing Transaction Account," "Time Deposit(s), Open Accounts" and/or "Time Certificate(s) of Deposit' at a rate to be negotiated between DEPOSITOR and DEPOSITORY, with such interest to be paid on "Time Deposit(s), Open Account' monthly as it accrues through the last day of each month and at maturity on "Time Certificate(s) of Deposit." Interest on "Time Certificate(s) of Deposit' shall be calculated for the exact number of days on the basis of a 365 -day year. III. SUBJECT to the provisions stated above as to "Time Deposit(s), Open Account' and subject to the terms of the "Savings Account' or "Time Certificate(s) of Deposit," DEPOSITORY shall pay on demand to the order of DEPOSITOR upon presentation of checks, drafts, or vouchers properly issued, all or any portion of said deposits now on deposit or to be deposited with said DEPOSITORY, as long as collected funds are on deposit. WE utilize the 91 day T -Bill auction rate for the week closest to the first of the month analyzed as an earnings credit rate. Combined average daily collected balances less combined average daily federal reserve requirements are used to offset the combined services rendered. You may remit to the bank any amounts due or be charged monthly. Any excess available balance can be carried to the next month for service compensation. Any interest paid on checking accounts is considered an expense on the Account Analysis statement. IV. ALL funds on deposit with DEPOSITORY to the credit of the above DEPOSITOR (including "Demand Deposit(s) ," "Interest Bearing Transaction Account," "Savings Account," "Time Deposit(s), Open Account" and "Time Certificate(s) of Deposit") shall be secured under a "Security Agreement' more completely described herein and made a part hereof. Eligible securities to secure Certificates of Deposit, to the extent that they are not insured, may be secured by authorized investments, a list of which is attached hereto as "Exhibit B." Eligible securities to secure "Demand Deposit(s)," "Interest Bearing Transaction Account," and "Savings Account" to the extent that they are not insured, may be secured by any collateral that complies with the Texas Government Code Section 2257 as amended "The Collateral Act", a list of which is attached hereto as `Exhibit B and/or Exhibit C." The DEPOSITOR recognizes that FDIC (or its successor) insurance is available for DEPOSITOR'S monies deposited at any one Texas financial institution (including branch banks) only up to a maximum of $200,000 (including accrued interest). It is the policy of the DEPOSITOR that all deposited monies in each of the DEPOSITOR'S funds shall be insured by the FDIC, or its successor, or secured by Collateral pledged to the extent of 101% of the fair market value of the amount not insured in compliance with the Collateral Act, provided that if the Collateral pledged consists of mortgage pass- through securities (declining principal securities), 120% of the fair market value of the amount not insured must be secured by Collateral pledged to the DEPOSITOR. V. DEPOSITORY has heretofore or will immediately hereafter deliver to a Third Party Custodian Bank (CUSTODIAN) bonds of the kind and character above mentioned sufficient in amount to cover fully the funds of said DEPOSITOR now or hereafter deposited with said DEPOSITORY; in excess of FDIC insurance, which bonds shall have at all times an aggregate market value, exclusive of accrued interest, equal to the total amount of all such funds on deposit. Said bonds or the substitute bonds as hereinafter provided for, shall be kept and retained by the CUSTODIAN in custody so long as the depository relationship between DEPOSITOR and DEPOSITORY shall exist hereunder, and thereafter so long as said deposits or future deposits made by DEPOSITOR with DEPOSITORY, or any portion hereof shall have not been properly paid out by DEPOSITORY. VI. THE CUSTODIAN will accept said bonds and hold the same in joint custody for the purpose herein stated under a separate joint safekeeping account with the CUSTODIAN, the DEPOSITOR and the DEPOSITORY which will substantially address operating agreements, guidelines and procedures as follows in Section VII through Section XIV. VII. IT is distinctly understood by all the parties hereto that the CUSTODIAN shall not be required to ascertain the amount of funds on deposit by the DEPOSITOR with DEPOSITORY, nor the validity, authenticity, genuineness, or negotiability of the securities deposited hereunder with the CUSTODIAN by DEPOSITORY, and shall be liable to no one hereunder except for the safekeeping of the securities herein provided for as and when received, and the ordinary negligence of its own officers, agents and employees. VIII. SHOULD DEPOSITORY fail at any time to pay immediately and satisfy upon presentation any check, draft, or voucher lawfully drawn upon any "Demand Deposit," or fail at any time to pay and satisfy, when due, any check, draft, or voucher lawfully drawn against any time deposit and the interest on such time deposit, or in case DEPOSITORY becomes insolvent or in any manner breaches its contract with DEPOSITOR, it shall be the duty of the CUSTODIAN upon demand of DEPOSITOR (supported by proper evidence of any of the above listed circumstances), to sell such bonds, or deliver on order for sale, and out of the proceeds therefrom DEPOSITOR will be paid for all damages and losses sustained by it, together with all expenses of any kind and every kind incurred by it on account of such failure or insolvency, or sale, accounting to DEPOSITORY for the remainder, if any, of said proceeds. IX. ANY sale herein made of such bonds, or any part thereof, may be either at public or private sale; provided, both DEPOSITOR and DEPOSITORY should receive notice of the time and place where such sale shall take place, and such sale shall be to the highest bidder therefor for cash. DEPOSITOR shall have the right to bid at such sales. X. IF DEPOSITORY shall desire to sell or otherwise dispose of any one or more of said bonds so deposited with the CUSTODIAN, it may, with prior approval of DEPOSITOR, substitute for any one or more of such bonds other bonds of the same market value and of the character authorized herein. which said right of substitution shall remain in full force and be exercised by DEPOSITORY as often as it may desire to sell or otherwise dispose of any such original bonds or substitute bonds; provided, however, that at all times the initial aggregate amount of such bonds or substituted bonds deposited with the CUSTODIAN shall always be such that the aggregate market value thereof, (exclusive of accrued interest), of at least 101 % of the sum of DEPOSITOR'S funds or deposits in all accounts, in excess of FDIC insurance, and if, at any time, the aggregate amount of such bonds so deposited with the CUSTODIAN be less than the 100% total sum of the DEPOSITOR'S funds on deposit with said DEPOSITORY, then, in that event, DEPOSITORY shall, upon demand in writing by DEPOSITOR, immediately deposit with the CUSTODIAN such additional bonds as may be necessary to equal 101% of the total sum of said deposits. DEPOSITORY shall be entitled to income on securities held by the CUSTODIAN, and the CUSTODIAN may dispose of such income as directed by DEPOSITORY without approval of DEPOSITOR. In the case of Mortgage Backed collateral (declining principal securities) collateral will be maintained at 120% of the fair market value of the amount uninsured. XI. UPON written request of the DEPOSITOR the CUSTODIAN shall furnish as of any date requested a completely itemized list of bonds held as security for DEPOSITOR. 9411 IF at any time the bonds in the hands of the CUSTODIAN shall have a market value in excess of the sum of balances due DEPOSITOR by DEPOSITORY, then on the written authorization of his delegate, confirmed by a delegate of the DEPOSITOR, the DEPOSITORY may request withdrawal of a specified amount of bonds, the CUSTODIAN shall deliver this amount of bonds (and no more) to DEPOSITORY, taking its receipt therefor, and the CUSTODIAN shall have no further liability for bonds so redelivered to DEPOSITORY. XIII. Intentionally left blank XIV. WHEN the relationship of DEPOSITOR and DEPOSITORY shall have ceased to exist between DEPOSITOR and DEPOSITORY, and when DEPOSITORY shall have properly paid out all deposits of DEPOSITOR, it shall be the duty of DEPOSITOR to give the CUSTODIAN a certificate to that effect, whereupon the CUSTODIAN shall, with the approval of DEPOSITOR, redeliver to DEPOSITORY all bonds then in its possession belonging to DEPOSITORY, taking its receipt therefor, and an order in writing on said CUSTODIAN by DEPOSITOR and a receipt for such bonds by DEPOSITORY shall be a full and final release of the CUSTODIAN of all duties and obligations undertaken by it by virtue of these presents, and it shall stand fully and finally acquitted of all liability of any kind and character whatsoever to both said DEPOSITOR and said DEPOSITORY. XV. The DEPOSITORY will provide to the DEPOSITOR a statement of the DEPOSITORY'S financial position on a quarterly basis. The DEPOSITORY also will provide to the DEPOSITOR upon request a copy of the DEPOSITORY'S annual financial statement. XVI. The DEPOSITORY represents that: (a) the DEPOSITORY is the sole legal and actual owner of the securities utilized to collateralize deposits; (b) no other security ,interest has been, nor will be, granted in the securities utilized to collateralize deposits; (c) the DEPOSITORY is covered for all uncollateralized deposits up to $100,000 under the FDIC, or such other amount as may be applicable from time to time; (d) this Agreement has been approved by the DEPOSITORY'S Board of Directors or Senior Loan Committee and such approval is reflected in the minutes of the meeting at which this Agreement was approved; and (e) this Agreement is an official record of the DEPOSITORY, and has been, and will continue to be, an official record of the DEPOSITORY from the date of its approval by the DEPOSITORY'S Board of Directors. XVII. The DEPOSITORY represents and warrants that this Agreement is made pursuant to and is duly authorized by the Board of Directors of the DEPOSITORY. A true and correct copy of the minutes of the meeting of the DEPOSITORY'S Board of Directors at which this Agreement was approved and accepted is attached to this Agreement as Exhibit "F" and incorporated for all purposes. XVIII. Intentionally left blank. WITNESS the execution hereof this ! day of a a -.e 20 C. Approved by Frost Board of Directors on. 24th day of July, 2003. ATTEST: A w t hger�l`o55 }� Title: T6WrL bee ref -a P ATTEST: p�s Idne: Donna Easterling Title: Assistant Vice President DEPOSITOR: TOWN OF WESTLAKE, TEXAS By Name; f—hn Z , Title: `TCS W vl, BANK: FROST NAT BANK By: Name: Tom Frost III Title: Sr. Executive Vice President EXHIBIT "A" The following is a summary list of the investments under the Investment Act as of September 1, 1995. Please refer to the Investment Act for further restrictions and eligibility requirements for these investments, as this summary list is not inclusive of all restrictions and eligibility requirements. 1. Obligation of the U.S. or its agencies and instrumentalities. 2. Direct obligation of the State or its agencies and instrumentalities. 3. Collateralized mortgage obligations directly issued by a federal agency or instrumentality of the U.S., the underlying security for which is guaranteed by an agency or instrumentality of the U.S. and that are not: (a) obligations whose payment represents the coupon payments on the outstanding principal balance of the underlying mortgage-backed security collateral and pays no principal (IO's); or (b) obligations whose payment represents the principal stream of cash flow from the underlying mortgage-backed security collateral and bears no interest (PO's); or (c) collateralized mortgage obligations that have a stated final maturity date of greater then 10 years; or (d) collateralized mortgage obligations, the interest rate of which is determined by an index that adjusts opposite to the changes in the market index (inverse floaters). 4. Other obligations the principal and interest of which are unconditionally guaranteed or insured by or backed by the full faith and credit of this State or the U.S. or their respective agencies and instrumentalities. 5. Obligations of states, agencies, counties, cities, and other political subdivisions of any state rated as to investment quality by a nationally recognized investment rating firm not less than A or its equivalent. 6. Certificates of deposit issued by a State or national bank domiciled in this State or a savings and loan association domiciled in this State that are guaranteed or insured by the FDIC or secured by Authorized Investments, including mortgage-backed securities directly issued by a federal agency or instrumentality, that have a market value of not less than the principal amount of the certificates. 7. Fully collateralized repurchase agreements as authorized by the Investment Act. 8. Bankers' acceptances with a stated maturity of 270 days or fewer from the date of issuance as authorized by the Investment Act. 9. Commercial paper with a stated maturity of 270 days or fewer from the date of issuance as authorized by the Investment Act. 10. No-load money market mutual funds regulated by the SEC, with a dollar-weigbted average stated maturity of 90 days or fewer and which include in their investment objectives the maintenance of a stable net asset value of $1 for each share as authorized by the Investment Act. 11. No-load mutual funds registered with the SEC and invested exclusively in Authorized Investments, with an average weighted maturity of less than 2 years, and continuously rated as to investment quality by at least one nationally recognized investinentrating Irani ofnot less than AAA or its equivalent as authorized by the Investment Act (authorized only for the operating account). EXHIBIT `B" The following is a summary list of the securities which are authorized for use as collateral of public funds under the Collateral Act as of September 1, 1995. Please refer to the Collateral Act for further restrictions and eligibility requirements for these investments, as this summary list is not inclusive of all restrictions and eligibility requirements. List of Time Deposit Collateral 1. Surety Bonds. 2. Obligations of the U.S. or its agencies and instrumentalities. 1 Direct obligations of the State or its agencies and instrumentalities. 4. Collateralized mortgage obligations directly issued by a federal agency or instrumentality of the U.S., the underlying security for which is guaranteed by an agency or instrumentality of the U.S. and that are not: (a) obligations whose payment represents the coupon payments on the outstanding principal balance of the underlying mortgage-backed security collateral and pays no principal (IO's); or (b) obligations whose payment represents the principal stream of cash flow from the underlying mortgage-backed security collateral and bears no interest (PO's); or (c) collateralized mortgage obligations that have a stated final maturity date of greater than 10 years; or (d) collateralized mortgage obligations, the interest rate of which is determined by an index that adjusts opposite to the changes in the market index (inverse floaters). 5. Other obligations the principal and interest of which are unconditionally guaranteed or insured by or backed by the full faith and credit of this State or the U.S. or their respective agencies and instrumentalities. 6. Obligations of states, agencies, counties, cities, and other political subdivisions of any state rated as to investment quality by a nationally recognized investment rating firm not less that A or its equivalent. 7. Certificates of deposit issued by a State or national bank domiciled in this State or a savings and loan association domiciled in this State that are guaranteed or insured by the FDIC or secured by Authorized Investments, including mortgage-backed securities directly issued by a federal agency or instrumentality, that have a market value of not less than the principal amount of the certificates. 8. Fully collateralized repurchase agreements as authorized by the Inveshnent Act. 9. Bankers' acceptances with a stated maturity of 270 days or fewer from the date of issuance as authorized by the Investment Act. 10. Commercial paper with a stated maturity of 270 days or fewer from the date of issuance as authorized by the Investment Act. 11. No-load money market mutual funds regulated by the SEC, with a dollar -weighted average stated maturity of 90 days or fewer and which include in their investment objectives the maintenance of a stable net asset value of SI for each share as authorized by the Investment Act. EY IIBI'T `B" con't. 12. No-load mutual funds registered with the SEC and invested exclusively in Authorized Investments, with an average weighted maturity of less than 2 years, and continuously rated as to investment quality by at least one nationally recognized investment rating firm of not less than AAA or its equivalent as authorized by the Investment Act (authorized only for the operating account). 13. TexPool. EXHIBIT "C" The following is a summary list of the securities which are authorized for use as collateral of public funds under the Collateral Act as of September 1, 1995. Please refer to the Collateral Act for further restrictions and eligibility requirements for these investments, as this summary list is not inclusive of all restrictions and eligibility requirements. List of Demand/Savings Deposit Collateral 1. Surety Bonds; 2. An obligation that in the opinion of the Attorney General of the U.S. is a general obligation of the U.S. and backed by its full faith and credit; 3. A direct obligation of the U.S.; 4. An obligation the principal and interest on which are unconditionally guaranteed by the U.S.; 5. An obligation of an agency or instrumentality of the U.S. including a mortgage-backed security of the agency or instrumentality; 6. Obligations of the U.S. or its agencies and instrumentalities; 7. Collateralized mortgage obligations directly issued by a federal agency or instrumentality or the U.S, the underlying security for which is guaranteed by an agency or instrumentality of the U.S.; 8. Other obligations, the principal and interest of which are unconditionally guaranteed or insured by or backed by the full faith and credit of the U.S. or its agencies and instrumentalities; 9. A general or special obligation issued by a public agency that is payable from taxes, revenues, or a combination of taxes and revenues, rated as to investment quality by a nationally recognized rating agency with a current rating of not less than A or its equivalent; 10. Direct obligations of the State or its agencies and instrumentalities or other obligations, the principal and interest of which are unconditionally guaranteed or insured by or backed by the full faith and credit of this state or its agencies and instrumentalities; it. Collateralized mortgage obligations directly issued by a federal agency or instrumentality of the U.S., the underlying security for which is guaranteed by an agency or instrumentality of the U.S. and that are not: (a) obligations whose payment represents the coupon payments on the outstanding principal balance of the underlying mortgage-backed security collateral and pays not principal (IO's); or (b) obligations whose payment represents the principal stream of cash flow from the underlying mortgage-backed security collateral and bears no interest (PO's); or (c) collateralized mortgage obligations that have a stated final maturity date of greater than 10 years; or (d) collateralized mortgage obligations, the interest rate of which is determined by an index that adjusts opposite to the changes in the market index (inverse floaters); 12. Obligations of states, agencies, counties, cities, and other political subdivisions of any state rated as to investment quality by a nationally recognized investment rating firm not less than A or its equivalent; 13. Certificates of deposit issued by a State or national bank domiciled in this State or a savings and loan association domiciled in this State that are guaranteed by the FDIC or secured by obligations that are Authorized Investments under the Investment Act. 10 Exhibit "C" cont 14. Repurchase agreements that are Authorized Investments; 15. Bankers' acceptances that are Authorized Investments; 16. Commercial paper that is an Authorized Investment; 17. No-load money market mutual funds that are Authorized Investments; 18. No-load mutual funds that are Authorized Investments; 19. Investment pools that meet the requirements of the Investment Act. I