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HomeMy WebLinkAboutReso 124-93 BofCalifRESOLUTION NO. 124 -- 93 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN AUTHORIZING THE EXECUTION OF A CUSTODY AGREEMENT WITH THE BANK OF CALIFORNIA, N.A. WHEREAS, prudent cash management practices recommend that Federal securities be held by a third party custodian; and Whereas, consolidating the record keeping of all Federal Securities with a single institution will provide for a more efficient administration of the City's portfolio; and Whereas, accounting for these investments pursuant to a written agreement will provide improved security for the City Treasury; and Whereas, the staff solicited proposals for these services from various financial institutions; and Whereas, the services offered by The Bank of California were determined to meet the City's needs. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin does hereby authorize the City Manager to execute the Custody Agreement between the City of Dublin and The Bank of California (Exhibit A), attached hereto and by reference made a part hereof. PASSED, APPROVED AND ADOPTED this 22nd day of November, 1993. AYES: Councilmembers Burton, Houston, Howard, Moffatt, and Mayor Snyder NOES: None ABSENT: None ATTEST: Ma r Clerk t • CUSTODY AGREEMENT This agreement is made between City of Dublin , ( "Client ") and The Bank of California, N.A. ( "Bank ") TERMS AND CONDITIONS 1. APPOINTMENT AS AGENT Client hereby appoints Bank as agent to act as custodian of cash, securities, and other property ( "Properly ") described on Schedule A, attached hereto, and other property which may be deposited by Client with Bank from time to time to be held in the account established by this Agreement ( "Account ") and Bank agrees to act as Client's agent for such property according to the terms and conditions of this Agreement. 2. HANDLING OF INCOME AND PRINCIPAL 2.1 Income. Bank shall collect the income, when paid on said Property, and hold it in a demand deposit income account until invested or otherwise disposed of pursuant to Client's written instructions. 2.2 Principal. Bank shall collect principal of Property when paid on maturity, redemption, sale, or otherwise, and hold it in a demand deposit principal account until invested or otherwise disposed of pursuant to Client's written instructions. 2.3 Collection Obligations. Bank shall diligently collect income and principal of which the Bank has received actual notice in accordance with normal industry practices. However, Bank shall be under no obligation or duty to take any action to effect collection of any amount if the securities or other Property upon which such amount is payable is in default, or if payment is refused after due demand unless the Bank has been adequately indemnified by Client in advance. Bank, however, shall notify Client promptly of such default or refusal to pay. 2.4 Additions to and Withdrawals from Account. Bank shall make all additions and withdrawals of Property to and from this Account only upon receipt of and pursuant to written instructions from Client except for those withdrawals provided for in Section 4. Upon receipt of such order for each withdrawal, unless otherwise instructed in writing, Bank shall deliver the Property so withdrawn to Client or to Client's designee, upon an appropriate receipt. 3. INVESTMENT OF PROPERTY 3.1 Directions by Client. Client shall have sole responsibility for the investment, review, and management of all Property held in this Account. Bank shall make all purchases, sales, conversions, exchanges, investments and reinvestments of Property held in this Account only upon receipt of and pursuant to written instructions from Client. Bank shall have no duty or obligation to review, or make recommendations for, the investment and management of any Property held in this Account, including uninvested cash. Page 1 3.2 Handle Corporate Actions. Bank shall notify Client of the receipt of notices of redemptions, conversions, maturities, exchanges, calls, puts, subscription rights, and scrip certificates ( "Corporate Actions "). Bank need not monitor financial publications for notices of Corporate Actions and shall not be obligated to take any action without waiting for Client's instruction. If a Corporate Action has a fixed expiration date, and Bank has not received written instructions regarding it from Client five business days prior to such date, Bank shall take such action as it deems appropriate in its sole discretion. 3.3 Fractional Interests. Bank shall receive and retain all stock distributed by a corporation as a dividend, stock split, or otherwise. However, in connection therewith, if a fractional share is received, Bank shall sell such fractional share. 3.4 Use of Nominees. Bank shall have the right to hold all registered securities in the name of its nominee. 3.5 Use of Securities Depository. Bank may, in its discretion, deposit in a securities depository any securities which, under applicable law, are eligible to be deposited. 4. PLEDGE OF SECURITIES Client shall inform Bank in writing in the event that Client has pledged any Property held in the Account as collateral ( "Pledged Collateral ") for any loan or advance ( "Secured Obligation ") made to Client by The Bank of California, N.A., or by any other lender designated by Client ( "Secured Party "). Client's notice to Bank shall precisely identify the Pledged Collateral and state the name, address, telephone number and telex number of the Secured Party and the appropriate officer, if any, to contact in connection with the Pledged Collateral, and Client shall provide evidence that a copy of such notice has been provided to the Secured Party. Client shall be responsible to Bank for keeping Bank informed of any changes to this information, and Bank shall be fully protected in relying on such notice until receipt of a notice providing additional or substituted information. Bank shall segregate and identify such Property in its records as pledged. Notwithstanding anything to the contrary contained in this Agreement, by providing the notice referred to above, Client acknowledges and agrees that the terms of this Custody Agreement are superseded by the terms of any pledge or security agreement covering the Pledged Collateral, and that Bank cannot release the Pledge Collateral without the prior written consent of the Secured Party. In the event that the Secured Party shall notify the Bank in writing of a default of such Secured Obligation, Bank shall follow, with no further obligation, the written instructions of the Secured Party regarding the Pledged Collateral and shall be fully protected in so doing. Any interest or principal payments due on the Secured Obligation may be charged to the Account upon written instruction from Client. 5. PROXIES AND CORPORATE LITERATURE 5.1 Proxies. Bank shall forward all proxies and accompanying material issued by any company whose securities are held in the Account to Client unless directed in writing not to do so. Page 2 t • 5.2 Corporate Literature. Bank shall have no duty to forward or retain any other corporate material received by the Account unless required to do so by law. 5.3 Disclosure to Issuers of Securities. Unless Client directs Bank in writing to the contrary, Client agrees that Bank may disclose the name and address of the party with the authority to vote the proxies of the securities held in this Account as well as the number of shares held, to any issuer of said securities or its agents upon the written request of such issuer or agent in conformity with the provisions of the applicable law. 6. CONFIRMATIONS 6.1 Confirmations. Bank shall have no responsibility to send confirmations of security transactions occurring in this Account to Client; however, Client may request confirmations for security transactions at any time at no additional cost to Client, and such confirmations shall be sent to Client within the time prescribed by law. 6.2 Statements. Each month, Bank shall send Client a cash statement and an asset statement showing market values. The statements will show all income and principal transactions and cash, securities and other Property holdings. Client may approve or disapprove such statement within sixty (60) days of their receipt and, if no written objections are received within the sixty -day (60) period, such statements of the account shall be deemed approved. 7. USE OF OTHER BANK SERVICES Client may direct Bank to utilize for this Account other services or facilities provided by Bank, its subsidiaries or affiliates. Such services shall include, but not be limited to (1) the purchase or sales of securities as principal to or from, or, (2) the placing of orders for the purchase, sale, exchange, investment or reinvestment of securities through any brokerage service conducted by, or (3) the placing of orders for the purchase or sale of units of any investment company managed or advised by Bank, BanCal Tri-State Corp., or their subsidiaries or affiliates. Client hereby acknowledges that Bank will receive additional fees for such services in accordance with Bank's standard fee schedules, which shall be delivered to Client from time to time. Notwithstanding the above, Client hereby directs Bank to utilize for this Account for cash management purposes the HighMark Group of mutual funds advised by Bank. Client shall designate the particular HighMark Fund that Client deems appropriate for the Account. Client hereby acknowledges that Bank will receive management fees for such services in accordance with Bank's standard fee schedules, which shall be delivered to Client from time to time. These management fees will be in addition to those fees charged by Bank as agent for the Client's Custody Account. 8. INSTRUCTIONS All instructions from Client shall be in writing, and shall continue in force until changed by subsequent instructions. Pending receipt of written authority, Bank may, in its absolute Page 3 s • discretion at any time, accept oral, wired, or electronically transmitted instructions from Client provided Bank believes in good faith that the instructions are genuine. 9. COMPENSATION AND OTHER CHARGES 9.1 Compensation. Bank's annual fee as agent shall be based on the published standard fee schedule of the Bank for Custody Accounts as it exists from time to time. Fees shall be billed quarterly. 9.2 Chamina the Account. Bank is authorized to charge the Account for incidental expenses as well as for funds necessary for Bank to complete any purchase ,or expense, to make any directed disbursement or take any other action regarding the Account. Bank shall have no duty to make any purchases, exchanges, or disbursements or to incur any expenses, unless the funds necessary to cover the amount of the expense are available in the Account. 10. COST BASES AND DATES OF ACQUISITION Client agrees to furnish Bank with the income tax cost bases and dates of acquisition of all Property held in the Account to be carried on its records. If Client does not furnish such information for any such Property, Bank shall carry the Property at any such nominal value it determines, such value to be for bookkeeping purposes only. All statements and reporting of any matters requiring this information will use this nominal value. Bank shall have no duty to verify the accuracy of the cost bases and dates of acquisition furnished by Client. Property purchased in the Account shall be carried at cost. 11. LIMITED POWER OF ATTORNEY Bank is hereby granted a limited power of attorney by Client to execute on Client's behalf any declarations, endorsements, assignments, stock or bond powers, affidavits, certificates of ownership or other documents required (1) to effect the sale, transfer, or other disposition of Property held in the Account, (2) to obtain payment with respect to Property held in the Account, or (3) to take any other action required with respect to the Property held in the Account, and in the Bank's own name to guarantee as Client's signature so affixed. 12. INDEMNIFICATION As additional consideration for the Bank's acceptance of this Account and Agreement to act as "Agent," Client agrees to indemnify, and hold Bank, its officers, directors, employees and agents harmless from and against any and all losses, liabilities, demands, claims, and expenses, any attomey's fees and taxes (other than those based on Bank's net income) arising out of or in connection with this Agreement, or out of any actions of Client or Client's agents which are not caused by Bank's negligence or willful misconduct. This provision shall survive the termination of this Agreement and shall be binding upon each party's successors, assigns, heirs and personal representatives. Page 4 t • 13. AMENDMENT AND TERMINATION OF AGREEMENT 13.1 Amendment. This Agreement may be amended only by a written agreement executed by both Bank and Client. 13.2 Termination. This Agreement may be terminated at any time by written notice from one party to the other. Such termination shall be effective immediately. In addition, this Account shall terminate upon notification to the Bank of Client's incapacity or Client's death. Upon termination, Bank shall have a reasonable amount of time to transfer the Property held in the Account in accordance with the written instructions of Client or the person or entity legally entitled to receive such property. Costs related to termination, including without limitation, costs for shipping securities and other Property held in the Account and costs of re- registering securities, generating reports and accounting for disposition of cash shall be charged to the Account. 14. ENTIRE AGREEMENT This Agreement and Addendum (not Applicable) constitute the entire Agreement between the parties. All previous agreements, whether written or oral, between the Bank and Client, are hereby superseded, except any direction to Bank prohibiting it to disclose information to issuers of securities as provided in Section 5.3. 15. SINGULAR AND PLURAL If more than one person shall execute this Agreement, then where the context permits, singular pronouns shall be deemed to be plural personal pronouns. 16. GOVERNING LAW This agreement shall be governed by, and construed under, the laws of the State of California/Oregon/Washington. 17. TAXATION OF ACCOUNT 17.1 W -9 Certification. Client agrees to provide a completed W-9 or W-8 certification, as appropriate, to Bank. 17.2 Client's Tax Identification Number is: 17.3 Client's responsibility for Filing Tax Retums and Paying Taxes. Client is responsible for filing any and all tax returns and for paying all taxes on Property and income held in this Account. 18. NOTICES 18.1 Mailing of Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed as having been duly given on the date of service, if served personally on the party to whom notice is to be given, or Page 5 on the fifth day after mailing, if mailed to the party to whom notice is to be given, by first class mail, registered or certified, postage prepaid, and properly addressed as follows: Client: City of Dublin 100 Civic Plaza Dublin, CA 94568 Attn: Paul S. Rankin Administrative Services Director Bank: The Bank of California 475 Sansome Street, 12th Floor San Francisco, CA 94111 Attn: Ellen Koerner Vice President 18.2 Change of Address. Either party may change the address at which notice may be given by giving ten (10) days prior written notice of such change to the other party. 19. EFFECTIVE DATE This Agreement shall become effective upon the date of receipt by the Bank of the securities and other property described in the attached Schedule A. Client: By: Title: Date: Accepted: THE BANK OF CALIFORNIA, N.A., Agent By:�P�� 6s%Gc�- Title: Date: ell Page 6