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HomeMy WebLinkAboutC2010-481 - 12/7/2010 - ApprovedCITY OF CORPUS CHRISTI DEPOSITORY SERVICES AGREEMENT Whereas, the City of Corpus Christi ("City") requested and received applications for the provision of depository services for City funds from depositories doing business within the city limits of Corpus Christi, Texas; Whereas, the City Council considered and reviewed the specifications of each application received and determined which application was the most advantageous for the City; Whereas, on, the City Council in Motion ~D 1~ ~~ g~ designated The Frost National Bank {"Depository") to be the depository for City funds and authorized the City Manager to execute this depository services agreement ("Agreement") with Depository; NOW THEREFORE, in consideration of the mutual benefits to be derived from this Agreement, including representations, warranties, and covenants, the City and Depository agree as follows: ARTICLE 1 Definitions For purposes of implementing this Agreern.ent, the terms listed below~will have the following meanings: "Authorized City Representative": the City Manager or other persons designated to perform duties in accordance with this Agreement. The present Authorized Ciry Representatives are specified in Exhibit E. "Account Transfers": written, electronic (wire/ACH}, telephonic, telegraphic or oral requests or orders issued by an Authorized City Representative for the transfer of City funds on deposit from City accounts maintained at the Depository for credit to accounts designated by the Authorized City Representative. "Deposits": include demand and time deposits. The City may withdraw demand deposits on dexnand. Time deposits are subject to a contract under which the City may not withdraw funds by check or other means until the expiration of a certain period following written notice. "City Funds" : all accounts held by the Depository for the City. "Total City Balance": the sum of all ledger balances of alI City accounts held by Depository. "Depository Services": all services required according to this Agreement i40ther Financial Services": all services necessary in the administration, collection, investment, and transfer of city funds. ARTICLE 2 Provision of De ositor Services 2.OI Depository_Services and Fees. The Depository hereby agrees to provide depository and other services described in this Agreement for the City funds deposited at the Depository. The City agrees to pay a net monthly service fee to Depository, which will be calculated as described herein. For the duration of the initial term of this Agreement and any extension hereof, the Depository agrees to calculate the earnings credit rate as follows: based upon the previous month's average 91-day T-Bill auction discount rate plus 50 basis nnir~ts. 2010-481 M2010-2g9term of this Agreement and any extension hereof, the Depository agrees to 1210711D ,nt stamps and deposit bags at no charge. '" ~ ; .'- . ~ Frost Sank 1 ~N~~~ 2.02 Guaranteed Service Fees. All service fees Listed in Exhibit A, incorporated for all purposes into this Agreement, are guaranteed for the entire term and any option year of the Agreement. The service fees will be used in calculating the net monthly service fee. Depository agrees to waive the first four months' analysis (fees). 2.03 Calculation of Net MonthIy Service Fee. A written. invoice evidencing the services performed for the City by the Depository must be mailed to the City at the encl of each month for each account. This invoice must also contain a section summarizing the services provided and the fees for services for all accounts. The City will have five working days to confirm the services performed. After the City has confirmed the services performed by the Depository, the City agrees to pay a monthly net service fee for the services provided by Depository. The monthly net service fee is to be calculated as follows: The Depository will calculate total earnings credit for all City account balances grouped together and not for single account balances. The Depository will calculate the total monthly service fees for all accounts. If the total service fees are greater than the total earnings credits, then the difference between the two will be the net depository service fee for the month. 2.04 Past of Net Monthly Service Fee. The Depository will not debit a City depository account for the net monthly service fee until the Depository and the City agree that the net monthly depository service fee is correct. The net monthly service fee will be allocated among accounts as designated by an Authorized City Representative. 2.05 Representations of Depository. The Depository shall: (a) keep the City funds covered by this Agreement; (b) faithfully perform all. duties and obligations imposed on the Depository by law and under this Agreement; {c) pay on presentation all checks drawn and properly payable on a demand deposit account with the Depository; (d) pay all transfers properly payable as directed by an Authorized City Representative; (e) provide and maintain security at the level required by the provisions of Chapter 2257, Government Code and.this Agreement; and (f) account for the City funds as required by law. 2.06 Electronic Cash Management Services. The Depository must provide electronic cash management services. Using Internet access, the City through an Authorized City Representative must be able to access and transmit a variety of balance and transaction information as required in this Depository Services Agreement. Any necessary software to perform these services, including but not limited to, stop payments, wire transfers, account balance and transaction information, and transmission of Automated Clearing House ("ACH"} debit or credit transactions, shall be made available by the Depository, at no charge to the City. 2.07 Deposits. The Depository shall accept all deposits made by the City during the term of the Depository Services Agreement. The Depository shall accept City deposits for ledger credit until 3:00 p.m. Central, Tirne CT each business day. The City reserves the right to exclude deposits made on behalf of the Corpus Christi Fire Fighters' Retirement System and any other special funds which are controlled by entities separate and apart from the City. 2.08 Items Deposited. AlI payments made directly to the City by customers will be sent to the bank unencoded. 2.09 Automated Information Re ortin . Using Internet access, the City must be able to access, for each City account, the previous day's ending ledger balance, collected balance, float, and debit/credit detail by $:00 a.m. CT daily. By this same deadline, this information shall be combined to reflect totals for all City accounts taken together. 2 2.10 Items Processing service. The Depository shall provide the following processing services for all items of checks and cash deposited by the City, including, but no limited to: encoding services, credit and debit advices given to the City within three business days of the debit or credit, clearing returned items, and return of stamped duplicate deposit slips to the City within one business day of deposit The City intends to deposit all revenues directly to the Depository by courier. The deposits will be made in batches with a tape to be provided for each batch. If the Depository Item Processing Department discovers an error in the deposit, then the Depository shall prepare a credit or debit advice and mail it to the City immediately after the account has been adjusted.. The Depository shall also mail the appropriate documentation attached to the debit or credit advice to justify the correction. Appropriate documentation is considered to be a copy of the City's tape with the item in question marked and a copy of the check in question. 2.11 Check Sorting Requirements. Any account that has more than 400 checks shaIi be fine-sorted in numerical order by the Depository. 2.12 Insufficient Funds (NSF)IReturned Items. A complete description shall be provided on all NSFlreturned items deposited into City accounts. The description shall include the Payor's name, applicable City department, and reason for return. All NSF/returned items shall be charged back to the account to which the items were deposited provided that the City department is identified by endorsement stamp. or other readily identifiable means on the item. The Depository will send the NSF/returned items to the City department or other business designated by an Authorized City Representative. 2.13 Stop payments. Stop payments shall remain in effect for at least six {6) months. By using Internet access, the City through an Authorized City Representative shall be able to initiate stop payments. Placernent of stop payments through the Internet does not require follow-up written authorization. 2.14 Automatic payroll deposit services. Using Internet access; the City through an Authorized City Representative will electronically transmit City employee payroll data to the Depository. The Depository will receive the data. and prepare an Automated Clearing House ("ACH") debit. The Depository payroll account will be debited no sooner than the date of payroll.. Exhibit A contains the 2010 Payroll Calendar. Procedures for processing the ACH debit are set out herein. 2.15 General Wire Transfer Services. Using Internet access, the City shall be able to initiate general wire transfer services including initiation of repetitive and non-repetitive wire transfers. Wire advices should be mailed within three .days of wire debit or credit. The Depository shall act upon all electronic, written or verbal transfer requests within one hour from the time received from an Authorized City Representative, and use any means for the transmission of the funds the Depository m.ay consider suitable up unti13:30 p.m. CT. The Depository shall record all telephonic instructions from the City received by the Depository's wire transfer department and retain the recordings for sixty-one {61} days (the period for City notification of discrepancXes) following such requests. In the event there is a loss of interest or use of funds as result of a Depository error for failure to execute a transfer request on the date received, or such other error within the Depository's control, compensation for loss shall be corrected by adjusting the aggregate ledger and collected balances of the City accounts to reflect properly the average balances of the amounts that would have resulted had no error occurred. 2.1G Account Reconciliation Services. All depository statements and paid items shall be on a monthly cycle and shall be cutoff on the last calendar day of ,the month. The City will pick up all Depository statements via electronic format (such as a compact disk - CD) no later than the fifth working day following the assigned cut-off date. The Depository may not mail the CD unless an Authorized City Representative approves such mailing. If a statement for a City depository account is not cut off as specified in this Agxeernent, the Depository shall reimburse the City for the costs incurred to reconcile the statement, including City employee overtime costs. The Depository will provide the City access to cleared checks via the Internet. 2.17 Depository Reconcilem_ents. Automated depository reconcilements with Internet access are required for the Vouchers Payable and Payroll accounts and other accounts as required by an Authorized City Representative as transaction volume increases. By using the Internet, the City will electronically transmit reconcilement data to the Depository. Reconcilements shall be available for pick up by the City by the ninth working day following the date the data was transmitted to the Depository. "Add/delete" adjustment forms will be provided by the Depository: The Depository will transmit reconcilement information to the administrators of the City's health care and worker's compensation accounts and others as designated by the City. 2.18 Checl~in~ with Interest Accounts. If designated by an Authorized City Representative, a derriand deposit account will be set up as intexest bearing and interest will be paid monthly. Interest rates will be those set for public fund interest bearing accounts. 2.19 Controlled Disbursement Service. Specific accounts as designated by an Authorized City Representative will be controlled disbursement accounts. By 11:1.5 a.m. CT each day, the City shall be able to access same day information concerning controlled disbursement clearings using the internet. 2.20 Zero-Balance Accounts . Specific accounts as designated by an Authorized City Representative will be zero-balance checking accounts for ease in reconciling and record keeping. 2.21 Check Cashiri~. Depository shall pay on presentation all checks drawn and properly payable on a City demand deposit account at no charge to the payee or to the City. 2:22 De osit Locations. The City will have the option to make Deposits at the Depository's main Corpus Christi office or at any of Depository's Corpus Christi branches. A deposit ticket will be presented to the Depository with each deposit. The Depository will route specified deposit ticket copies to the City on a daily basis. 2.23 Ni ht De ositor The City will utilize the night depository facilities of the Depository for safekeeping purposes. The City will use special tamper-evident deposit bags in making deposits through the night depository facility. Each bag placed in the night depository facility will contain only currency; coin, and checks. The Depository will be responsible for safekeeping these bags until the City {or its agent) collects them on the next City business day at &:00 a.m. CT. The Depository will record the bags on a form prescribed by the City and will verify the list when the City {or its agent) collects the deposit bags. If it appears that a bag has been tampered with, the Depository shall telephone an Authorized City Representative before transferring the bag. The Depository will verify the list with the City when the City collects the deposit bags. 2.24 Overdrafts. The City does not intend to have an overdraft position on any of its depository accounts throughout the course of the depository services contract. If a check or checks are presented for payment on any City account where there exist insufficient funds available for payment, the Depository agrees to pay said checks and promptly notify the Finance Director or Authorized City Representative of the existence of the overdraft situation. The City agrees to covex the overdraft within one business day. The Depository will view all City accounts together for purposes of any charges on overdrawn collected balances. 4 2.25 Authority of Authorized City Representative. An Authorized City Representative may request depository services as required to implement this Agreement. Axr Authorized City Representative may open a depository account. The Depository shall not require corporate resolutions or other documents to establish depository accounts at the request of an Authorized City Representative. 2.26 Investment Services. The City reserves the right to exclude from the terms of this Agreement, investment in certificates of deposits, government securities, fully collateralized repurchase agreements or similar instruments authorized bylaw. 2.27 Account Executive Service. The Depository agrees to assign one of its officers employed by the Depository in Carpus Christi, Texas to coordinate the depository relationship established under this Agreement. The assigned officer is responsible for responding to questions from an Authorized City Representative. The assigned officer shall perform necessary research to promptly respond to questions or concerns of the City regarding its accounts. The assigned officer of the Depository shall meet with the City at least once a month to evaluate the working relationship between the City and the Depository and to address any problems. 2.28 Reports. The Depository will provide quarterly reports of income/condition (required by the FDIC) by the 15th day following the reporting deadline for each calendar quarter. 2.29 Direct Debit of Utility Customers. The City shall electronically transmit data to the Depository regarding those City utility customers who have previously authorized the City to directly debit their demand deposit accounts for City utility bills. Upon request by the City, the Depositary shall provide this pre- authorized direct debit service. The Depository will receive the data and prepare an ACH debit in accordance with the operating rules of the South Western Automated Clearing House Association and the operating rules of the National Automated Clearing House Association and as provided herein. ARTICLE 3 Security for Deposits 3.01 Backssround. As security for the deposits of the City, the Depository shall pledge to the City securities equal to the largest total ledger balances the City maintains in the Depository, less the amount of coverage provided by the Federal Deposit Insurance Corporation. All funds deposited under the Depositary Services Agreement shall be continuously secured in accordance with applicable federal laws and regulations as well as the Laws of the State of Texas, including, but not limited to: the Public Funds Collateral Act, Vernon's Texas Government Code Section 2257A01 et. seq. and Subchapter C Security for Funds Held by Depository of Vernon's Texas Local Government Code. 3A2 Quantification as Depository. The Depository shall, no later than five days before the commencement of the term of this Depository Services Agreement; pledge security for the funds to be deposited by the City at the Depository as provided by Subchapter C, Security. for Funds Held by Depository of Chapter 105, Depositories fox Municipal Funds of the Texas Local Government Code, Chapter 2257, Public Funds Collateral Act, Government Code, and this Depository Services Agreement. Colntateral_Provrs~on o __Financial Inst~tut~on Re orm, Recovery and Enf, _, _ ' ' , orcement Act (FIRREA). The Depository shall provide certification that the Depository has complied with all requirements of the Financial Institution Reform, Recovery and Enforcement Act (FIRREA} and FDIC policies which may apply to the City's security interests in the pledged collateral and shall specify the officers of the Depository who are authorized to sign agreements with the City. Prior to the initial pledge of securities under the Depository Services Agreement, the Depository shall: (a} execute a Security Agreement -Pledge and ancillary agreements necessary to effect the pledge of securities to collateralize all of the City's deposits in such form as is acceptable to the City; (b) deliver to the City a certified copy of excerpts from the minutes of a meeting of 5 the Loan Committee and/or Board of Directors of the Depository, properly authorizing the Depository to enter into a Security Agreement-Pledge, and to pledge assets of the Depository to secure all deposits made by the City with the Depository; and {c) deliver to the City certification that the Depository Agreement, the Security Agreement -Pledge, and the authorization of the Board of Directors and the Loan Committee of the Depository have been placed (and will continuously be maintained) in the official records of the Depository. 3.04 Permissible Security. Only the following types of securities are acceptable to the City to secure City deposits: (1) a treasury note of the United States or other evidence of indebtedness of the United States that is guaranteed as to principal and interest by the United States. (2) an obligation of an agency of the United States, provided that: (i) the market value can be readily established and (ii} the obligation has been approved by an Authorized City Representative. 3.05 Custodian. of Pledged Securities. The securities pledged by the Depository as collateral for City deposits shall be deposited with a Texas branch of the Federal Reserve Sank, {"the Custodian"), in escrow in a safe-keeping account held in the name of the City, ("the Custodian Account"). The Custodian Account shall require the authorization of both the Depository and an Authorized City Representative to release pledged collateral. The Custodian, upon receipt of pledged securities, shall promptly issue and deliver to the Authorized City Representative trust receipts for the securities pledged. The securities shall be held by the Custodian. The Custodian may not transfer or deposit the securities in another institution without the prior written autharization of an Authorized City Representative. 3.06 Amount of Collateral. Securities pledged by the Depositary to secure City funds on deposit identified with federal taxpayer identification number 74-6000574 shall have a market value of at least eight million dollars ($8,000,000) or as designated in writing by an Authorized City Representative. During the City's tax season, which occurs from October through March, the Depository shall provide additional collateral in accordance with this Agreement. Securities pledged by the Depository to secure City funds identified with federal taxpayer identif cation number 74-2442464 shall have a market value of at least one million five hundred thousand dollars ($1,500,000} or as designated in writing by an Authorized City Representative. 3.07 Determination of Marl~et Value. The market value of a security is to be determined by an Authorized City Representative from a third party source (i.e. Primary dealer, Wall Street ]ournal) and is binding on the Depository. 3.08 Char es for Collateral. Charges for the collateral provided by the Depository are provided in the Applicant's response to Section 3.6, Fees, B, of the Request for Applications. 3.09 Federally Insured Deposits. The Depository is not required to provide security for the deposit of City funds to the extent deposits are insured under 12 U.S.C.A., Sections 1811-I835a. 3.10 Additional Security. An Authorized City Representative may, by written order, require the Depository to pledge additional collateral at any time it is determined to be advisable. Additionally, if, far any reason, the total City balance on deposit with the Depository exceeds the market value of pledged .security, the Depository shall immediately pledge additional securities to the City. Any additional security pledged shall meet-the requirements of this Depository Services Agreement and shall be approved by an Authorized City Representative. Failure to pledge additional securities on the day the Depository is provided notice constitutes grounds for City Council to select a new depository as required by law and terminate the Depository Services Agreenn.ent. 6 Prior to the pledge of additional securities under the Depositary Services Agreemeot, the Depository shall: (a) execute a Security Agreement- Pledge and ancillary agreements necessary to effect the pledge of additional securities to collateralize all of the City's deposits in such form as is acceptable to the City; (b) deliver to the City a certified copy of excerpts from the minutes of a meeting of the Loan Committee and/or Board of Directors of the Depository, properly authorizing the Depository to enter into a Security Agreement-Pledge, and to pledge assets of the Depositary to secure all deposits made by the City with-the Depository; and (c) deliver to the City certification that the Depository Agreement, the Security Agreement -Pledge, and the authorization of the Board of Directors and the Loan Committee of the Depository have been placed (and will continuously be maintained) in the official records of the Depository. 3.11 Substitution of Securities. The Depository may substitute one security for another provided that the security meets the requirements of this Depository Services Agreement; the substitution is approved, in writing, by an Authorized City Representative and the Depository.. Prior to such substitution of securities, the Depository shall: {a) execute a Security Agreement- Pledge and ancillary agreements necessary to effect the pledge of securities to collateralize all of the City's deposits in such form as is acceptable to the City; (b} deliver to the City a certified copy of excerpts from the minutes of a meeting of the Loan Committee and/or Board of Directors of the Depository, properly authorizing the Depository to enter into a Security Agreernent- Pledge, and to pledge assets of the Depository to secure .all deposits made by the City with the Depository; and {c) deliver to the City certif cation that the Depository Agreement, the Security Agreement -Pledge, and the authorization of the Board of Directors and the Loan Committee of the Depository have been placed {and will continuously be maintained) in the official xecoxds of the Depository. 3.12 Release of Security. If the securities pledged by the Depository exceed the amount required under this Depository Services Agreement, an Authorized City Representative may authorize the release of the excess. Such xelease shall be approved in writing by an Authorized City Representative. 3.13 Records and Audit. The Depository shall maintain separate, accurate, and complete records relating to the deposit of public funds, the pledged investment securities, and alI transactions relating to the pledged investment securities. The Custodian shall maintain separate, accurate, and complete records regarding the pledged investment securities. All such records shall be subject to any internal or external audit or regulatory examination of the Depository or Custodian. 3.14 Documentation to Be Provided to City. The Depository and Custodian shall provide documentation relating to the description of securities pledged as collateral, substitution of pledged securities, pledge of additional securities, and withdrawal of excess securities to the Authorized City Representative. A certificate as to the then-market value of securities pledged as security hereunder shall be provided to the Authorized City Representative at least monthly. 3.15 Surrender of Interest on Securities. Upon the request of the Depository, the City shall surrender, when due, interest coupons or other evidence of interest on securities if the remaining value of the securities pledged are adequate to meet the requirements of this Agreement. ARTICLE 4 Account Transfers 4.01 Electronic, Telephonic, Telegraphic or Oral Requests for Account Transfers. The Depository is authorized to honor, execute and charge City accounts for electronic, telephonic, telegraphic or oral requests: (a} for the transfer of funds from designated City accounts to any other City depository account, whether the account is with the Depository or another financial institution; or 7 (b) for the transfer of funds from designated City accounts to the account of or the credit of a third party, whether the third party account is with the Depository or another financial institution. A11 requests shall be properly identified as being made by an Authorized City Representative in compliance with the Depository's transfer procedures. 4.02 Internal Transfers. An Authorized City Representative will periodically need to transfer funds from one City account to another to reimburse payroll, Vouchers Payable, and other accounts. 4.03 Instructions for Transfer. The Depository shall. act upon all electronic, written or verbal transfer requests within one hour from the time received from an Authorized City Representative, and use any means for the transmission of the funds the Depository may consider suitable up unti12:30 p.m. CT. 4.04 Immediate Credit. The Depository shall give both ledger and collected credit the day of the wire receipt, regardless of the time the Depositary receives the transfer through the Fed wire System. Credit to City accounts for incoming wire transfers shall be immediate. 4.05 Da li ht Overdraft Polic .The City actively invests in marketable securities. An outgoing wire transfer will be made in the morning for the reinvestment of funds expected by an incoming wire transfer. The Depository shall allow the City to reinvest and to wire funds out in anticipation of an incoming wire transfer later in the day. The Depository will not charge the City fox daylight overdrafts. When a daylight overdraft is anticipated, an Authorized City Representative will notify the designated depository official of the situation. 4.Ob Notification of Funds Transfers. Notification to the City of incoming wire transfers or problems with outgoing wire transfers shall be made within one hour of the transaction. The City allows two authorized employees to initiate repetitive transfers. All authorized employees will be issued a personal identification number in order to initiate wire transactions. If the wire transfer is initiated over the telephone, the Depositary shall telephone the City and specifically request to speak to an Authorized City Representative other than the person initiating the wire to verify that the wire is authorized prior to releasing the wire. 4A7 Records. The Depository shall record all telephonic instructions from the City received by the Depository's wire transfer department and retain the recordings for sixty-one (61 } days (the period for City notification of discrepancies) following such requests. The City agrees to report any discrepancies between the City's records and the Depository statement to the Depository's wire transfer department in writing within sixty-one (61) days after the statement date. 4.08 Discrepancies/Loss of InterestlError. In the event there is a loss of interest or use of funds as result of a Depository error for failure to execute a transfer request on the date received, or such other error within the Depository's control, the Depository agrees that compensation for loss shall be corrected by adjusting the aggregate ledger and collected balances of the City accounts to reflect properly the average balances of the amounts that would have resulted had no error occurred. 4.09 Desi nated Accounts. Account Transfers may be made from the other accounts as designated by an Authorized City Representative. ARTICLE 5 Other Financial Services 5.01 BailorlBailee Relationship. Until deposits are credited to the City as evidenced by validation of duplicate deposit slips, the relationship between the City and the Depository as to all contents shall be that of Bailor and Bailee. The Depository shall be responsible and liable to the City for use of that degree of care required under the laws of Texas for Bailees having custody of property of other persons. 5.02 Custody, Safekeeping of Governmental Agency Securities. The Depository agrees to handle all purchases and sales of securities on a delivery versus payment or payment versus delivery basis (i.e. for securities purchases, monies will not be released by the City's safekeeping bank until securities are received at the Federal- Reserve Bank or further credit to the City's safekeeping bank. In the case of securities sales, monies will be received by the City's safekeeping bank via the Federal Reserve Bank as the securities are simultaneously released to the purchaser}. In this manner, the City will always have possession of either the securities or its monies on a delivery versus payment basis. The cost of safekeeping securities, processing purchase/sale transactions, and coupon interest payments are listed in the Applicant's response to Section 3.b, Fees, A., MONTHLY PRICING SUMMARY FORM. The City will send written instructions to the securities clearance department for each transaction, Mast of these instructions will be sent by facsimile to assure the timeliness of the operation. It is specifically provided that when a City security matures, or when a City security is purchased, funds will be transferred from or to the Combined Operating account, the Bond Funds account, or another account as directed by an Authorized City Representative. The Depository shall give prompt notification to the City of any settlement problems, including securities delivered where the instructions do not match or where instructions have not been given to the Depository. All securities shall be perfected in the name of the City. All book entry securities owned by the City shall be evidenced by a safekeeping receipt issued to the -City. The original safekeeping receipt for each transaction will be forwarded to the City. ARTICLE 6 General Provisions 6.01 Automated Clearing House (~~ACH") Mernbershi~ The Depository shall be a participating depository in the Southwestern Automated Clearing House Association to be able to deliver debit and- credit payments for the following transactions: City employee payroll Account and Pre-authorized City Utility Customer Debits. An Authorized City Representative shall establish use of additional ACH transactions in writing. The Depositary warrants that it is a participating financial institution in the Southwestern Automated Clearing House Association ("SWACHA"), which provides facilities for the exchange of electronic funds- transfers among its members, and other automated clearing house associations within the United States by utilizing the capacities of the National Automated Clearing House. Association ("NACHA"). The Depository acknowledges that it shall comply with the rules, as may be amended, for the notification, posting, or transfer of funds by means of electronic credit transfer facilities. The Depository is required to comply with the procedures of the' SWACHA and NACHA including, but not limited to, matters such as input format, data acceptance criteria, return item handling, adjusting entries, and dishonored entries. 6.02 Char~in~ of Fees. The Depository is authorized to charge City accounts upon direct authorization by an Authorized City Representative for: (a) charge backs on correction of mathematical errors, and {b} bank service fees owed to Depository, including Deficient Balances Before Services. Defrcient Balances Before Services will be reviewed by the City's Treasurer on a quarterly basis for fee assessment. The Depository or the City will not change the schedule of fees as listed in Exhibit A during the initial term of this Agreement or during any option year. 6.03 Confidentiality, Audits and Inspections. All information assembled by the Depository under this Agreement is to be kept confidential and not be made available to any individual or organization without the 9 prior written approval of the City. At reasonable times during regular business hours, the Depository will make available for examination by the City, its duly authorized agent, accountant, or legal representative, pertinent copies of statements and debit and credit items supporting -such statements, relating to the City's accounts. 6.04 Recalls, Debit Adjustments and Other Adjustments. The Depository is required to process recall or adjustment requests upon verbal authorization 6y an Authorized City Representative followed by written confirmation by the City, if passible, no Iaer than four (4) working days after the request. 6.05 Compliance with Law. The Depository represents to have the expertise and personnel required and necessary to perform the services under this Agreement. The Depository acknowledges that it is fully qualified, authorized, and willing to comply under federal, state and local law to perform the services described in this Agreement. 6.Ob Indemnification. THE DEPOSITORY FULLY INDEMNIFIES, SAVES, AND. HOLDS HARMLESS THE CITY OF CORPUS CHRISTI, ITS OFFICERS, EMPLOYEES, AND AGENTS AGAINST .ANY AND ALL LIABILITY, DAMAGE, ACCOUNT OF PERSONAL INJURIES (INCLUDING, WITHOUT LIMITATION ON WORKERS' COMPENSATION AND DEATH CLAIMS), OR PROPERTY LOSS OR DAMAGE OF ANY KIND WHATSOEVER, WHICH ARISE DUT OF OR AREINANYMANNER CONNECTED WITH.• (A) THE DEPOSITORY'S FAILURE TD FULFILL ANY OF THE TERMS AND CONDITIONS OF THISAGREEMENT; (B) ANY VIOLATION BY DEPOSITORY OF ANY APPLICABLE FEDERAL OR STATE LAW, RULES, OR REGULATION RESULTING FROM ANY ACT OR OMISSION OF THE DEPOSITORY OR ITS AGENTS AND EMPLOYEES WHICH CAUSED A DIRECT LOSS TO THE CITY UNDER THISAGREEMENT. THE DEPOSITORY MAY, AT ITS OWN EXPENSE, INVESTIGATE ALL CLAIMS AND DEMANDS, ATTEND TO THEIR SETTLEMENT OR OTHER DISPOSITION, DEFEND ALL ACTIONS, PAY ALL CHARGES OF ATTORNEYS OR OTHER EXPENSES OF ANY KIND ARISING FROM LLABILITY, DAMAGE, LOSS, CLAIMS, DEMANDS, AND ACTIONS THIS INDEMNIFICATION WILL NOT BE CONSTRUED TO REQUIRE INDEMNIFICATION OF SUCH INJURY, LOSS OR DAMAGE WHICH MAY BE CAUSED OR ARISE FROM THE NEGLIGENCE OF THE CITY, ITS OFFICERS, EMPLOYEES, AND AGENTS. TO THE EXTENT PERMITTED BY TEXAS LAW, THE CITY AGREES TO INDEMNIFY, SAVE AND HOLD HARMLESS, DEFEND OR PAY THE DEFENSE COST OF THE DEPOSITORY, ITS OFFICERS, AGENTS, AND EMPLOYEES FROM AND AGAINST ANY AND ALL LAWSUITS, CLAIMS, DEMANDS, LIABILITIES, LOSSES OR EXPENSES, INCLUDING COURT COSTS, ATTORNEY AND EXPERT WITNESS FEES, FROM OR ARISING OUT OF NEGLIGENCE OF THE CITY UNDER THE TERMS OF THIS AGREEMENT OR THE CITY'S FAILURE TO FULFILL ANY OF THE TERMS AND CONDITIONS OF THIS AGREEMENT. 6.07 Terzr-. This Agreement shall commence on the date following the date signed by the last signatory hereto and shall continue for a period of three years, or until a successor Depository is appointed and qualif ed. The City may, by 90 day written notice to Depository, terminate this Agreement during the remainder of the initial term and any option terms. Upon completion of the initial term, either parry may elect to terminate any option term with 90 days prior written notice. Unless terminated, this Agreement will automatically renew for two additional one-year terms. Depository guarantees all service fees for the initial term of the Agreement and any option year. Upon termination or expiration of this Agreement, all finished or unfinished documents, data, studies, or reports prepared by the Depository, at the option of the City, will be delivered to the City and become the property of the City. 10 6.08 Duties After Termination. All obligations of the parties made or incurred or existing under this Agreement as of the date of termination, with respect to transactions initiated prior to the effective date of termination, will survive such termination, including, but not limited to: Depository's obligation to retain duplicates of transaction receipts and credit slips and any continuing obligation of the Depository with respect to charge backs. Upon termination of this Depository Services Agreement, all finished or unfinished documents, data, studies, or reports prepared by the Depository, at the option of the City, will be delivered to the City and become the property of the City. 6.09 No Endorsement. The Depository is not authorized to advertise or publish, without City's prior written consent, the fact that the City has entered into this Agreement will be construed as if such provision was not a part of this Agreement. 6.10 Notices. Notices provided herein will be in writing and delivered to: On behalf of the City: City of Corpus Christi David Hedberg, City Treasurer P.O. Box 9277 Corpus Christi, TX 78469-9277 On behalf of the Depository: Frost National Bank Tom Frost III, SEVP P.O. Box 1600 San Antonio, TX 78296-1600 6.11 Assi ng ment. Any party may not assign this Agreement without the prior written consent of the other party 6.12 Force Maieure. Neither parry-will be responsible for losses resulting if the fulfillment of any terns or provisions of this control of the. party whose performance is interfered with, and which, by the exercise of reasonable diligence, said party is unable to prevent. 6.13 Conflicts of Interest. The Depository agrees to maintain current, updated disclosure of information on file with the Director of Finance throughout the term of this Agreement as may be required by the City Code of Ordinances or the City Charter. 6.14 Equal EmpIoyment Opportunity. The Depository agrees that during the performance of this Agreement, it will: (a) treat all applicants and employees without discrimination as to race, color, religion, sex, national origin, marital status, age, or handicap, and (b) identify itself as an "Equal Opportunity Employer" in employment advertising or requests. The Depository will be advised of any complaints filed with the City alleging that the Depository is not an Equal Opportunity Employer. The City reserves the right to consider its reports from the Human Relations Administrator in response to such complaints. 6.15 Entire Agreement. This Agreement and all amendments hereto, as may be updated, constitute the entire agreement between the parties and will supersede all previous negotiations, commitments, and contracts. 6.16 Governin Law and Venue. To the extent this Agreement is not governed by applicable federal laws and regulations, this Agreement will be governed by and construed in accordance with laws of the State of Texas. Any suit brought in connection with this Agreement shall be tried in Nueces County, Texas. 11 6.17 Notification of Chan es in De ositor Laws. The Depository shall notify the City in writing within ten (10) days of any changes in federal or state regulations or laws that would thereafter affect the Depository Services Contract. The Depository shall also notify the City of any services, which become available to the City throughout the contract period. 6.1.8 Monthly Reports. The Depository shall provide to the City each quarterly CALL report (Schedule RC only) as well as any public information concerning changes in the ownership, management or financial position of the Depositary or its parent company. 6.19 Car orate Resolutions Not Re uired. The Depository shall not require corporate resolutions when an Authorized City Representative opens an account. 6.20 Precedence of Contract Documents. In case of a conflict in the contract documents, first precedence shall be given to the fully executed contract, as amended; second precedence shall be given to the REQUEST FOR APPLICATION, including addenda and third precedence shall be given to the application, as clarified. 6.21 Term_s___During_Extension Year. During any extended term of the agreement, all terms, conditions and pricing shall remain the same as those in the agreement applicable to the primary term. AGREED TO BY: CITY OF CORPUS CHRISTI BY: C.'~tr NAME: g R. Escobar TITLE: ity Manager DATE: ~ o? • 01 j • ~ (7 FROST BANK BY: NAME ~~ J~1' Tom Frost III TITLE: Senior Executive Vice President DATE: l6 a ~%-ICa ATTEST: ~~~~. AUTllgRll~~' ~Y Cfl0~CR1...~;~.~ `7 i 0 Armando Chapa, City Secr .~ !~ ~' Approved as to form this the `L~' day of;~}-- ~f~~~.~.,..,ta-~l,$~~~"~ By: ~.~v~ .~' .~--~-~ Veronica Ocaiias, Assistant City Attorney FoY: Carlos Vald City Attorney Incozporated by Reference: Exhibit A -Monthly Fee Schedule Exhibit B -Authorization for Depository Accounts Exhibit C - 2010 Payroll Calendar Exhibit D -Request far Applications No.: BI-0210-10 Exhibit E -Applicant's/Depository's Response to Request for Applications No. BI-0210-10, as clarified 12 EXHIBIT A MONTHLY FEE SCHEDULE GENERAL ACCOUNT SERVICES VOLUME UNIT PRICE TOTAL PRICE ACCOUNT MAINTENANCE 14 4.D0 $ 56.00 ACCOUNT MAINTENANCE - 2 1 4.00 $ 4.00 DEBITS POSTED 5,277 0.04 $ 211.08 CREDITS POSTED 2,247 0.15 $ 337.05 ZERO BALANCE ACGTNG TRANSFERS 97 0.50 $ 48.50 MONTHLY ZBA FEE 4 O.OD (no charge) $ O.OD STATEMENTS RENDERED 18 3.OD $ 54.00 SPECIAL SIGNATURE REQ-BASE FEE 12 3.00 $ 36.00 SPECIAL SIGNATURE REQ-ITEMS 1,751 0,02 $ 35.D2 REMOTE CAPTURE MONTHLY 4 100.00 $ 400.04 TOTAL GENERAL ACCOUNT SERVICES $9,181.65 LOCK80X SERVICES RETAIL MONTHLY MAINTENANCE 1 5D.00 $ 50.D0 WHOLESALE CASH PROCESSING 2 1.00 $ 2.04 RETAIL ITEM 30,8D4 0.18 $5,5D8.72 DATA TRANSMISSION 1 5D.00 $ 50.00 RETAIL CD-ROM-MONTHLY 1 25.D0 $ 25.00 RETAIL CD IMAGE -CHECK 33,326 0.0075 $ 249.95 RETAIL CD IMAGE -COUPON 3D,604 0.0075 $ 229.53 RETAIL IMAGE DELIVERY -INTERNET 1 50.00 $ 50.D0 BRANCH DELIVERY 1 4D.00 $ 40.00 RETAIL UNPROCESSABLE 138 0.18 $ 24.84 LQCKBOX CREDITS 44 0.55 $ 24.20 RETAIL CHCK ONLY 2,722 0.28 $ 762.16 TOTAL LOCKBOX SERVICES $7,818.40 DEPOSITORY SERVICES REMOTE CAPTURE - ON US ITEMS 815 O.D5 $ 40.75 REMOTE CAPTURE -LOCAL RCPC ITEMS 363 D.05 $ 18.15 REMOTE CAPTURE - O7N 11T" FED CITY 9 0.05 $ 0.45 REMOTE CAPTURE -TRANSIT CLEARING 2,169 0.05 $ 1D8.45 REMOTE CAPTURE - 11T" FED COUNTRY 1 4.05 $ 0.05 REMOTE CAPTURE - OTH 11T" FED COUNTRY 12 0.05 $ D.60 REMOTE CAPTURE -LOCAL CITY ITEMS 412 O.D5 $ 20.6D REMOTE CAPTURE - LOC STATEWIDE 8,960 0.05 $ 448.00 REMOTE CAPTURE - IMPAGE CAPTURE 12,741 0.00 (no charge) $ 0.00 REMOTE DEPOST CAPTURE-CREDITS 126 0.'15 $ 18.9D PARTIAL BAG OF LOOSE COINS 101 2.50 $ 252.50 CASH DEP PROC CASH AMT FLAT 1,560 0.00 (NIA) $ D.QO CASH DEP PROC CASH AMT PER 10D0 2,843 0.25 $ 710.75 ROLLED COIN FURNISHED - COM 265 0.05 $ 13.25 MINIMUM CHANGE ORDER 6 5.50 $ 33.00 STRAP CURRENCY FURNISHED -COM 26 0.55 $ 14.30 CASH DEP PROCESSING FEE f 1429 O.OD (no charge) $ 0.00 CASH DEP PROCESSING FEE III 28,294 0.00 (no charge) $ 0.00 CASH DEP PROCESSING FEE II 90,195 0.00 (no charge) $ O.OD DEPOSIT PROCESSING SUPPLIES **Cost** $ 0.00 ON U5 ITEMS 5,495 0.05 $ 274.75 LOCAL RGPG STEMS 1,825 0.05 $ 91.25 TRANSIT CLEARING 9,926 0.05 $ 496.3D LOCAL STATEWIDE CLEARING 22,988 0.45 $1,149.44 13 GENERAL ACCOUNT SERVICES VOLUME UNIT PRICE TOTAL PRICE 11T" FED COUNTRY ITEMS 7 0.05 $ 0.35 OTHER 11r" FED CITY ITEMS 33 0.05 $ 1.65 DTHER 11T" FED RCPC ITEMS 89 0.05 $ 4.45 RETURN 1TEM5 143 1.00 $ 143.00 DEPOSIT CORRECTIONS 9 1.00 $ 9.00 LOCAL CITY ITEMS 457 0.05 $ 22.85 TOTAL DEPOSITORY SERVICES $3,872.75 PAPER DISBURSEMENT SERVIGES CONTROLLED DISB ACTIVITY. $$ 0.00 (no charge} $ O.DD POSITIVE PAY PAID REJECT ITEMS 15 0.10 $ 1.54 POSITIVE PAY POSTED CHECKS 3,929 0.10 $ 392,90 ONLINE STOP PAYMENT 2 5.00 $ 10.00 POSITIVE PAY REJECTED ITEMS 11 0.10 $ 1.10 CASH MANAGER IMAGES 73 0.05 $ 3.65 CD ROM SERVICE - PER fTEMS 5,495 0.02 $ 109.90 CD ROM SERVICE -PER DISK 4 10.00 $ 40.00 MONTHLY CONTROLLED 4 25.Ofl $ 1DD.00 TOTAL PAPER DISBURSEMENT SERVICES $ 659.05 DISBURSEMENT RECONGILIATION FULL CHECK RECD 1,496 0.04 $ 59.84 ACCOUNT RECONCILIATION 1 ' 1D.00 $ 10.00 TOTAL DISBURSEMENT RECONCILIATION $ 69.84 GENERAL ACH SERVICES ACH ORIGINATION -ITEM 10,744 0.04 $ 429.76 ACH MONTHLY FEE 1 4.00 (no charge) $ 0.00 ACH ADDENDUM RECORD INIOUT 977 0.05 $ 48.85 ACH INCOMING DEBITS 67 0.04 $ 2.68 ACH INCOMING CREDITS 594 4.04 $ 23.76 ACH RETURN ITEM 26 1.04 $ 26.00 TOTAL GENERAL ACH SERVICES $ 537.45 WIRE AND OTHER FUNDS TRANSFERS ONLINEWIRE OUT NON-REP 39 7.00 $ 273.00 BOOK TRANSFER NON-REPETITIVE 22 1.00 $ 22.00 INCOMING FED WIRES 27 4.00 $ 84.00 WIRE ADVICES MAILED 13 1.50 $ 19.50 TOTAL WIRE AND OTHER FUNDS TRANSFERS $ 398.50 INFORMATION SERVICES PREVIOUS DAY REPORTING MDDULE 1 50.00 $ 50.00 INTRA DAY REPORT 11 0.00 (no Charge) $ 0.00 PREVfDUS DAY REPORTING 98 OAD (no charge) $ O.OD PREVIOUS DAY RPTING DETAIL 1TEMS 8,354 0.02 $ 167.08 TOTAL INFORMATION SERVICES $ 2i 7.08 INVESTMENTICUSTODY SERVKES CUSTODY -FIXED INCOME RECEIPTS 51 0.60 $ 30.60 CUSTODY ASSETS PER $10M BE 26,004 0.01 $ 26D.00 CLEARANCE -CALLED BONDS 6 10.00 $ 60.OD CUSTODY-- MONTHLY MAINTENANCE 1 10.OD $ 10.00 CUSTODY- INTEREST PAYMENTS 9 1.00 $ 9.00 CLEARANCE -FED NON-ABSIMBS 11 20.04 $ 220.00 14 GENERAL ACCOUNT SERVICES TOTAL INVESTMENTICUSTODYSERVKES. TOTAL ACTIVITY CHARGES VOLUME UNIT PRICE TOTAL PRICE $ 5$9.6D $74,535.92 15 EXHIBIT B Attached to and made a part of the City of Corpus Christi Depository Services Agreement AUTHORIZATION FOR DEPOSITORY ACCOUNTS As the duly appointed and authorized City Manager of the City of Corpus Christi, I designate the officers listed below as the Authorized City Representatives of the City of Corpus Christi. The signatures below are the signatures of the Authorized City Representatives vested with full authority to sign and transact business for the City including, but not limited to, Account Transfers, open and close accounts, request reports, or authorize other signatories to specific bank accounts. The signatures of the officers subscribed below are true and genuine: David Hedberg, City Treasurer Jerome Joslin, Investment Analyst Controller Constance P. Sanchez, Assistant Director of Financial Services Cindy O'Brien, Director of Financial Services This Authorization for Depository Accounts is entered into in addition to and will not amend, modify, waive, or revoke any of the terms of the City of Corpus Christi Depository Agreement except as expressly provided herein. This authorization is entered into to facilitate the electronic transfer of funds or administration of the services to be provided pursuant to the City of Corpus Christi Depository Agreement. It is not intended to empower Authorized City Representatives to approve or accept amendments, waivers, or new provisions or terms to the Depository Agreement on behalf of the City of Corpus Christi. Authorized City Representatives remain authorized until the Depository receives written notification revoking authorization. THIS AUTHORIZATION .FOR DEPOSITORY ACCOUNTS is effective this ~ day of ~~1 GCGI- , 20~ and revokes all previous authorizations. ATTEST: CITY OF CORPUS CHRISTI ~ By By ''/J~ ~ cd~~- Armando Chapa, City S retary Ang scobar, City Manager Approved this `2Z the day of ~~++' ~~-~/ , 20 ~~ By: ~'~~ ,Assistant City Attorney For: Carlos Valde City Attorney 16 EXHIBIT C 2010 PAYROLL CALENDAR PAY DATE 01/08/10 01/22/10 0215110 02/19/10 0315110 03/19/10 04/02/10 04/16/10 04/30/10 05/14/10 05/28/10 00/11/10 06/25/10 07/09/10 07/23/10 08/06/10 081201'10 09/03/10 09/17/10 10/01/10 10/15/10 10/29/10 11/12/10 11/24/10 12/10/10 12/23/10 17 ~~~~~ ~~- SECURITY AGREEMENT THE FROST NATIONAL BANK, N.A. (the "Bank"), for valuable consideration, the receipt and sufficiency of which is acknowledged, grants a security interest in and a pledge and assignment of (a) any and all Eligible Collateral (as defined below} from time to time held by The Federal Reserve Bank and/or Federal Home Loan Bank (the "Custodian"), identified on the Custodian's books as held far the account of the Depositor or jointly for the account of the Bank and the Depositor, together with (b} the products and proceeds of the foregoing and any substitutions or replacements thereof, whenever acquired and wherever located (the "Collateral") to City of Corpus Christi {the "Depositor"), in order to secure the payment when due, of the Deposits (as defined below) pursuant to the depository agreement ("Depository Agreement") between the Bank and the Depositor, dated of even date with this security agreement (the "Agreement"). This Security Agreement is subject to the terms and conditions of the Depository Agreement approved by the City Council on , 2010. In the event of any conflict, the terms of said Depository Agreement control and supercede the terms of this Security Agreement. All funds on deposit shall be continuously secured in accordance with the Texas Public Funds Collateral Act, Chapter 2257 of the Texas Government Code. 1. Definitions. Except as otherwise expressly defined in this Agreement, all terms used herein which are defined in the Uniform Commercial Code as in effect from time to time in Texas (the "Code") have the same meaning as in the Code. AlI other terms capitalized but not defined herein or in the Code have the meanings assigned to Chem in the Depository Agreement. "Account" shall mean the separate custodial account established with Custodian in the name of Bank and for the benefit and subject to the control of Depositor as secured party in accordance with this Agreement. "Authorized Person" shall be any officer of Depositor or Bank, as the case may be, duly authorized to give Written Instructions on behalf of Depositor or Bank, respectIVely, such authorized persons for Depositor to be designated in a certificate substantially in the form of Exhibit B, attached hereto, as such exhibit may be amended from time to time, or as designated in such other forms as may be prescribed by the Bank. "Book-Entry System" shall mean the Federal Reserve/Treasury Book Entry System for receiving and delivering U.S. Government Securities. "Business Day" shall mean any day on which Custodian and Bank are open for business and on which the Book Entry System is open for business. "Collateral Requirement" shall mean an amount of Securities with a Market Value equal to the greater of eight million dollars ($8,000,000) or 102% of Uninsured Deposits. "Deposits" shall mean all deposits by Depositor in Bank, including all accrued interest on such deposits, that are available far all uses generally permitted by Bank to Depositor for actually and finally collected funds under the Bank's account agreement or policies. FROST PUBLIC ~ UNUS ENTITY SECURITY AGREEMENT (FESRUA.ILX 2O~ U~ "Eligible Collateral" shall mean any Securities of the types enumerated in the Schedule of Eligible Collateral (which types are in compliance with the collateral policy adopted and approved by the governing body of Depositor) attached hereto as Exhibit A, as such exhibit may be amended from time to time pursuant to a written amendment signed by each of the parties to this Agreement, and any Proceeds of such Securities. "Market Value" shall mean: (i) with respect to any Security held in the Account, the market value of such Security as made available to Bank or Custodian by a generally recognized source selected by the Bank or the Custodian, plus, if not reflected in the market value, any accrued interest on such Security, or, if such source does not make available a market value, the market value shall be as determined by Custodian or the Bank in its sole discretion based on information furnished to Custodian or Bank by one or more brokers or dealers; and (ii) with respect to any cash held in the Account, the face amount of such cash. "Proceeds" shall mean any principal or interest payments or other distributions made in connection with Eligible Collateral and anything acquired upon the sale, lease, license, exchange, or other disposition of Eligible Collateral. "Security" or "Securities" shall include, without limitation, any security or securities held in the Boak-Entry System; common stock and other equity securities; bonds, debentures and other debt securities; notes, mortgages, or other obligations; and any instruments representing rights to receive, purchase, or subscribe for the same, or representing any other rights or interests in such security or securities. "Trust Receipt" shall mean evidence of receipt, identification, and recording, including a written or electronically transmitted advice or confirmation of transaction or statement of account. Each advice or confirmation of transaction shall identify the specific securities which are the subject of the transaction. ff available, statements of account may be provided by the Bank or the Custodian at Least once each month and when reasonably requested by the Depositor, and must identify all Eligible Collateral in the Account and its Market Value. "Uninsured Deposits" shall mean Chat portion of the daily ledger balance {amount of funds plus the amount of any accrued interest on the funds) of Depositor's Deposits with Bank which exceeds the standard maximum deposit insurance amount ("SMDIA") of the Federal Deposit Insurance Corporation ("FDIC"). "Written Instructions" shall mean written communications actually received by Bank or Custodian from an Authorized Person or from a person reasonably believed by Bank or Custodian to be an Authorized Person by a computer, telex, telecopier, or any other system whereby the receiver of such communications is able to verify by codes or otherwise with a reasonable degree of certainty the identity of the sender of such communication. 2. Security Renuirement. (a) The Bank, to secure the timely payment of Uninsured Deposits made by Depositor, has deposited with Custodian certain Securities as more fully described in the initial confirmation or Trust Receipt of such deposit delivered by Custodian to Bank and Depositor respectively. Pursuant to the Code, the Custodian shall act as a bailee or agent of the Depositor and, to the extent not inconsistent with such duties, shall hold Securities as a securities intermediary (as such term is defined in Chapter 8 of the Code) in accordance with the provisions of this Agreement, the Depository Agreement, and of any FROST PUBLIC FUNDS ENTITY SECURITY AGREEMENT (FEBRUARY 2414} agreement entered into with the Custodian further governing the provision of Security by the Bank for Uninsured Deposits. (b} (i} To secure the timely payment of Uninsured Deposits made by Depositor with Bank, Bank agrees to deliver or cause to be delivered to Custodian for transfer to the Account, Eligible Collateral having a Market Value equal or greater than the Collateral Requirement. (ii) If the Market Value of such Eligible Collateral on any Business Day is less than the Collateral Requirement for such day, the Bank shall be required to deliver additional Eligible Collateral having a Market Value equal to or greater than such deficiency as soon as possible but no later than the close of business of Custodian on the Business Day on which Bank determined such deficiency. If on any Business Day, the aggregate Market Value of the EIigible Collateral provided pursuant to this Agreement exceeds the Collateral Requirement for such day, Custodian shall, at the direction of Bank and with the approval of the Authorized Person acting on behalf of the Depositor, transfer from the Account to or for the benefit of Bank, Eligible Collateral having a Market Value no greater than such excess amount. (iii) When additional Eligible Collateral is required to cover incremental Deposits, the Bank must receive the request for collateral one (1} Business Day prior to the Business Day the incremental Deposits are received, and the Bank shall be required to deliver additional Eligible Collateral having a Market Value equal to oz' greater than the deficiency on the Business Day the incremental Deposits are received. (c) For any changes made to the EIigible Collateral held in the Account due to releases, substitutions, or additions of Eligible Collateral, the Custodian shall update its records of the Account accordingly as soon as possible and promptly issue a Trust Receipt to the Depositor and the Bank. (d} The Bank shall be entitled to income on Securities held by the Custodian in the Account, and the Custodian may dispose of such income as directed by Bank without approval of the Depositor, to the extent such income is not needed to meet the Collateral Requirement. 3, Custody of Securities. The parties agree that all Securities held in the Account shall be treated as financial assets. For purposes of the Code, the security interest granted by Bank in the Eligible Collateral and Proceeds for the benefit of the Depositor is created, attaches, and is perfected for all purposes under Texas law from the time Custodian identifies the pledge of any Eligible Collateral or Proceeds to the Depositor and issues a Trust Receipt to the Depositor for such Eligible Collateral ar Proceeds. The security interest of the Depositor in Securities and all Proceeds shall terminate upon the transfer of such Securities or Proceeds from the Account. 4. Delivery of Securities. Bank and Depositor agree that Securities and Proceeds delivered to or received by Custodian for deposit in the Account may be in the form of credits to the accounts of Custodian in the Book Entry System. Bank and Depositor authorize Custodian on a continuous and ongoing basis to deposit in the Book Entry System all Securities and Proceeds that may be deposited therein and to utilize the Book Entry System in connection with its performance under this Agreement. Securities and Proceeds credited to the Account and deposited in the Book Entry System will be represented in accounts that include only assets held by Custodian or its agent(s) for third parties, including but- not limited to accounts in which assets are held in a fiduciary, agency, or representative capacity. FROST PUBLIC FUNDS ENTITY SECURITY AGREEMENT (FEBRUARY 2010) The Bank acknowledges that to the extent permitted by law, the records of the Bank and/or the Custodian with respect to the pledge of Eligible Collateral as described in this Agreement: (a) may be inspected by the Depositor or by the Texas Comptroller of Public Accounts (the "Comptroller"), at any time during regular business hours of the Bank ar the Custodian; (b) such records may be subject to audit or inspection at any time pursuant to Sections 2257.025 and 2257Ab1 of the Texas Government Code, as amended; and (c) reports must be filed by the Custodian with the Comptroller when requested by the Comptroller. 5. Collection of Securities. R Depositor certifies in writing to Custodian that (a) Bank is in default under any underlying pledge or security agreement between Depositor and Bank, including the Depository Agreement and (b) Depositor has satisfied any notice or other requirement to which Depositor is subject pursuant to the Depository Agreement, then Depositor may give Custodian Written Instructions (x) to transfer specific amounts and issues of Securities held in the Account and, if applicable, specific amounts of the Proceeds held in the Account which have not previously been released to Bank, to designated accounts of Depositor and {y) to cease releasing to an account of Bank any Proceeds reflecting interest and principal on Securities in the Account as provided in Section 2{d}. b. Representation and Warranties. (a) Representations of Bank. Bank represents and warrants, which representations and warranties shall be deemed to be continuing, that: (i} the Board of Directors of the Bank has authorized the Bank to enter into this Agreement, and such authorization is reflected in the approving resolution of the Bank's Board of Directors and in the minutes of the meeting of the Board of Directors at which this Agreement was approved, and this Agreement has been Iegaliy and validly entered into and is enforceable against Bank in accordance with its terms; (ii) this Agreement and the pledge of Eligible Collateral under this Agreement do not violate or contravene the terms of the Bank's charter documents, by-Iaws, or any agreement or instrument binding on the Bank or its property, or any statute or regulation applicable to the Bank; (iii) the Bank has entered into this Agreement and the Depository Agreement (A} in the ordinary course of business, (B) in good faith and on an arm's-length basis with the Depositor, (C) not in contemplation of bankruptcy or insolvency, and (D} without intent Co hinder, delay, or defraud the Bank's creditors; (iv) a copy of each of (A} this Agreement, {B) the Depository Agreement, and (C} the resolution of the Board of Directors of the Bank approving this Agreement and the minutes of the meeting of the Board of Directors at which this Agreement was approved, have been placed {and will be continuously maintained) in the official records of the Bank; (v} the Bank is sale legal and actual owner of the Securities or of beneficial interests in Securities deposited in the Account, free of all security interests or other encumbrances, except the security interest created by this Agreement; (vi) this Agreement was executed by an officer of Bank who was authorized by the Bank's Board of Directors to do so; FROST PUBLIC FUNDS ENTITY SECURITY AGREEMENT (FEBRUARY ZO1O~ (vii) the Bank is a bank or trust company duly authorized to do business in the State of Texas; and (viii) all acts, conditions, and things required to exist, happen, or to be performed on its part precedent to and in the execution and delivery of this Agreement by it exist or have happened or have been performed. (b) Representations of Depositor. Depositor represents and warrants, which representations and warranties shall be deemed to be continuing, that: (i) this Agreement has been legally and validly entered into, has been approved by the Depositor's governing body, and does not and will not violate any statute or regulation applicable to it and is enforceable against Depositor in accordance with its terms; (ii) the appointment of Custodian has been duly authorized by Depositor and this Agreement was executed by an officer of Depositor duly authorized to do so; (iir) (A) alI Securities identified on the Schedule of EIigible Collateral, attached hereto as Exhibit A, may be used to secure Depositor's Uninsured Deposits under applicable statutes and regulations, (B} the Collateral Requirement meets the requirements of such applicable statutes and regulations, (C) the governing board of Depositor has approved a collateral policy which authorizes all such Securities to be used as Eligible Collateral, and (D) such collateral policy complies with all applicable statutes and regulations; (iv) it will not sell, transfer, assign, convey, pledge, or otherwise dispose in whole or in part its interests. in or the rights with respect to any Securities deposited in the Account, or the Proceeds of such Securities, except as permitted in Section 5 of this Agreement; (v} all acts, conditions, and things required to exist, happen, or to be performed on its part precedent to and in the execution and delivery of this Agreement exist or have happened or have been performed; (vi) Depositor will comply with the terms of any other agreements it may have with the Bank in connection with this Agreement; and {vii) In the event Depositor requests any financial services from the Bank other than depository services, the Depositor shall provide the Bank with a copy of the Depositor's current investment policy. 7. Continuun~ Agreement. This Agreement shall continue and remain in full force and effect and shall be binding upon the Bank and its successors and assigns until such time as (a) all Deposits have been paid in full to the Depositor or otherwise paid as instructed by the Depositor, and {b) the Depository Agreement is no longer in effect. 8. Rights and Remedies of the Depositor. The Depositor's rights and remedies with respect to the Collateral shall be those of a secured party under the Code and under any other applicable law, as the same may from time to time be in effect, in addition to those rights granted in this Agreement, in the Depository Agreement, and in any other agreement in effect between the Bank and the Depositor. The Depositor agrees to provide the Bank and the Custodian with reasonable notice of the sale, disposition, Fxos~ PuaLiC FuNns Eiv~'I'rY SECCIR~TY AGRCE1Vi~1vT (FESItvAFtY 2010) 5 or other intended action subject to the provisions of this Agreement in connection with the Collateral, whether required by the Code or otherwise. 9. Application of Proceeds by the Depositor. In the event the Depositor sells or otherwise disposes of the Collateral in the course of exercising the remedies provided for in Section 5 above and in the Depository Agreement, any amounts held, realized, ar received by the Depositor pursuant to the provisions of this Agreement, including the proceeds of the sale, in whole or in part, of any of the Collateral, shall be applied by the Depositor first toward the payment of any casts and expenses incurred by the Depositor in enforcing this Agreement, in realizing on ar protecting any Collateral and in enforcing or collecting any Deposits, including attorneys' fees, and then toward payment of the Deposits in such order or manner as the Depositor may elect. Any Collateral remaining after such application and after payment to the Depositor of all the Deposits in full shall be paid or delivered to the Bank, its successors or assigns, or as a court of competent jurisdiction may direct. 10. Notices. Any communication, notice, or demand to be given under this Agreement shall be duly given when delivered in writing or sent by telex or facsimile to a party at its address indicated below. If to the Depositor, at: David Hedberg Treasurer City of Corpus Christi P. O. Box 9277 Corpus Christi, TX 78469 If to the Bank, at: Ms. Donna Easterling Assistant Vice President Frost National Bank P. 0. Box 1600 San Antonio, TX 7829b 11. Miscellaneous. (a) i)pdating Certificate of Authorized Persons. Depositor agrees to furnish to Bank a new and updated "Certificate of Authorized Persons" substantially in the form of Exhibit B, attached hereto, or in similar form as Bank may require, within a reasonable amount of time after there are additions or deletions to list of Authorized Persons authorized to act on behalf of the Depositor, (b) Invalidity; Severability. If any clause or provision of this Agreement is for any reason held to be invalid, illegal or unenforceable, such holding shall not affect the validity, legality or enforceability of the remaining clauses or provisions of this Agreement. (c) Amendment. This Agreement may not be amended or modified in any manner except by written agreement executed by all of the parties. (d) Assignment and Bindin Eg ffect. The Depositor may not assign all or any part of its rights or obligations under the Agreement without the Bank's prior express written consent, which may be withheld in the Bank's sole discretion. The Bank may assign or delegate all or any part of its rights or obligations under the Agreement, including, without limitation, the performance of the services described herein. The Agreement will be binding on and inure to the benefit of the successors and permitted assigns of either party. (e) Governing Law; Venue. This Agreement shall be construed in accordance with the FROST PUBLIC FUNDS E; NTITY SECURITY AGREEMENT (FEBRUARY 2010) substantive laws of the State of Texas, without regard to conflicts of law principles thereof. Bank and Depositor hereby consent to the non-exclusive jurisdiction of a state or federal court situated in Bexar County, Texas, in connection with any dispute arising hereunder. Bank and Depositor hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which it may now or hereafter have to the laying of venue of any such proceeding brought in such a court and any claim that such proceeding brought in such a court has been brought in an inconvenient forum. Bank and Depositor each hereby irrevocably waives any and all rights to trial by jury in any legal proceeding arising out of or relating to this Agreement. (f) Liability of the Parties. The Bank's and Depositor's duties and responsibilities to each other are limited as set forth in this Agreement, except with respect to any provisions of the law which cannot be varied or waived by agreement. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, NEITHER BANK NOR DEPOSITOR WILL BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY, SPECIAL, OR PUNITIVE DAMAGES {INCLUDING WITHOUT LIMITATION, LOSS OF REVENUE OR ANTICIPATED PROFITS) OR FOR ANY INDIRECT LOSS THAT THE OTHER PARTY MAY INCUR OR SUFFER IN CONNECTION WITH THE SERVICES PROVIDED HEREUNDER {EVEN IF SUCH PARTY HAS BEEN INFORMED OF THE POSSIBILITY OF SUCH DAMAGES}, INCLUDING WITHOUT LIMITATION, ATTORNEYS' FEES. FROST PUBLIC FUNDS ENTITY SECURITY AGREEIVIEN'I' (k k'IIRUARX 2010) IN WITNESS WHEREOF, the Bank and Depositor have caused this Agreement to be duly executed as of the ~ day of ' e.~r~,,~j~, , 2010. THE FROST NATIONAL BANK, N.A. ~~ ~.;.r By t~ Name: Tom Frost III Title: Senior Executive Vice President Dated: !O-~ 1-IU DEPOSITOR ACC PTS AND AGREES as of ~.'. L~!d~ ~, 2010 CITY OF CORPUS CHRISTI r By N e Angel R. Escobar tle: City Manager I,~ l~~ 1 ~'r~~ -~L1THO~it~~ ~r co~~~~t ...~.,~0:7,,~10 ,w....:?~l1:. S~CR~fARY~J A~provad as to ~orm:~°'~ l L% ~~t ., ~~~- M• ~iS1 a 1~gUi~a Assistant C Attorney i'or City Attorney EXHIBIT A Schedule o~ Eligible Collateral Eli ible Collateral All funds on deposit under the provisions of this agreement shall be continuously secured in accordance with the Texas Public Funds Collateral Act, Chapter 2257 of the Texas Government Code. The following securities are approved as collateral for the City of Corpus Christi's funds: Only the following types of securities are acceptable to the City to secure City deposits: (1) a treasury note of the United States or other evidence of indebtedness of the United States that is guaranteed as to principal and interest by the United States. (2) an obligation of an agency of the United States, provided that: (i) the market value can be readily established and (ii) the abligation has been approved by an Authorized City Representative. FRQST PUBLIC FUNDS ENTITY SECURITY AGREEMENT (FEBRUARY 2010) A-1. EXHIBIT B CERTIFICATE OF AUTHORIZED PERSONS (Depositor) The undersigned hereby certifies that he/she is the duly elected and acting of (the "Depositor"), and further certifies that the following officers or employees of Depositor have been duly authorized in conformity with the approval of the Depositor's governing body to deliver Written Instructions to the [name of custodian] ("Custodian"} pursuant to the Security Agreement between Depositor and the Bank dated ,and that the signatures appearing opposite their names are true and correct: Name Title Signature Name Title Signature Name Title Signature Name Title Signature Name Title Signature Name Title Signature Name Title Signature Name Title Signature Name Title Signature This certificake supersedes any certificate of authorized individuals you may currently have on file. [corporate seal] Title: Date: FROST PIIBLIC FUND5 ENTITY SECURITY AGREEMENT (FEBRUARY ZOIO) B-1 SAFEKEEPING AGREEMENT (CORPORATE -- NO FOREIGN SECURITIES) THIS SAFEKEEPING AGREEMENT {this "Agreement"} is entered into as of the day of 2010 by and between THE FROST NATIONAL BANK, a national banking association organized and existing under the laws of the United States of America (the "Bank") and the CITY OR CORPUS CHRISTI, a POLITICAL SUBDIVISION OF THE STATE OF TEXAS (the "Depositor"). The Bank and the Depositor agree that all securities andlor other property deposited with and accepted by Bank ("Security") shall be governed by the terms and conditions herein set forth, and agree to the following: WITNESSETH: The Bank shall establish and maintain a custody account (the "Account") for and in the name of the Depositor and hold therein all securities deposited with or collected by the Bank in its capacity as custodian for the Account. The terms "Security" or "Securities" shall mean any negotiable or non- negotiable investment instrument{s) commonly known as a security or securities in banking custom or practice, and so long as held by the Bank, alI income therefrom and alI cash deposited by, or for the account of, the Depositor. The Bank agrees to open the Account and hold all Securities and other property, from time to time, deposited with or collected by the Bank for the Account, subject to the terms and conditions of this Agreement, as the same maybe amended from time to time. SECTION 1 ACCEPTANCE OF SECURITIES (a) The Bank shall accept delivery from and on behalf of the Depositor such Securities as shall, from time to time, be acceptable to it. Any Securities now held by the Bank for the Depositor under a prior custody agreement shall be deemed to have been deposited hereunder. The Bank shall have no responsibility to {i) determine the validity, genuineness or alteration of the Securities or related instn~ments delivered pursuant to the ternls hereof; (ii) review the Securities; or (iii) provide advice to the Depositor relative to the .purchase, retention, sale, exchange, disposition, call for redemption of the Securities or related instruments. The parties acknowledge that the Bank is performing the services hereunder merely as an aid to the Depositor, and this does not relieve the Depositor of its duty to manage and keep itself informed of information affecting its own portfolio. (b) The Bank shall supply to the Depositor from time to time as mutually agreed by the Bank and the Depositor a written statement with respect to all of the Securities held in the Account. In the event that the Depositor does not inform the Bank in writing of any exceptions or objections to such statement within sixty (60) days after receipt of such statement, the Depositor shall be deemed to have approved such statement. {c) The Bank shall segregate and identify on its books and records as belonging to the Depositor all Securities delivered by or for the account of the Depositor which are held by the Bank in the Account. (d) The Depositor authorizes the Bank, for any Securities held hereunder, to use the services of any United States central securities depository it deems appropriate and where it may hold any of its own securities, including, but not limited to, the Depository Trust Company and the Federal Reserve Book Entry System. The term "central securities depository" shall also include any depository service which acts as a custodian of securities in connection with a system for the central handling of securities whereby all securities of a particular class or series of any issuer deposited within the system are treated as fungible and may be transferred by bookkeeping entry without physical delivery of security certificates. Placement by the Bank of Securities into a central securities depository or safekeeping facility shall neither augment nor SANANTONIO 298076v5 82600-03994 diminish the Bank's duties or obligakions under any other paragraph of this Agreement, provided that the Bank shall have no liability for the acts or failure to act of any such central securities depository. {e) The Bank is authorized to re-register the Securities in the name of the Bank or iks nominee unless alternative and acceptable registration instructions are promptly furnished by the Depositor. SECTION 2 COLLECTION OF INCOME The Bank agrees to collect and receive the dividends, interest and other income from the Securities, as directed by the Depositor, and will credit the Depositor's designated deposit account for such items. Charges, if any, will be charged to the Depositor's deposit account under advice. The Bank will make commercially reasonable efforts to collect and receive such dividends, interest and other income from the Securities but assumes no liability for its inability to do so due to the acts or omissions of Depositor, any issuer of Securities or such issuer's paying agent, ar any third party. The Bank shall not be obligated to institu#e or participate in any legal proceedings relative to any such acts or omissions, The Bank is hereby authorized to sign, on the Depositor's behalf, any declarations, affidavits, cerkificates of ownership, or other documents which are now or may hereafter be required with respect to coupons, registered interest, dividends or other income on Securities. THE DEPOSITOR HERESY AGREES TO REIMBURSE, INDEMNIFY, AND HOLD HARMLESS, THE BANK, ITS OFFICERS, DIItECTORS AND EMPLOYEES FROM ANY LIABILITY, CLAIM, LOSS, DAMAGE OR EXPENSE (INCLUDING ATTORNEYS' FEES AND COURT COSTS) THAT MAY ARISE BY REASON OF THE EXECUTION OF ANY SUCH DOCUMENTS BY THE BANK. SECTION 3 COLLECTION OF PRINCIPAL The Bank is authorized to collect, receive and receipt for the principal of all Securities when and as the same may mature, be redeemed, or be sold upon the order of the Depositor. The proceeds of such collections, as well as any other principal payments received for any Securities, will be credited to the Depositor's designated deposit account. The Bank will use commercially reasonable efforts to collect the Securities and other property at maturity and at dakes of call for payment, but assumes no responsibility for its inabiIiry to do so due to the acts or ozx~issions of Depositor, any issuer of Securities or such issuer's paying agent, or any third party. The Bank shall not be obligated to institute or participate in any legal proceedings relative to any such acts or omissions, The Bank will not be liable fox the insolvency, or default in the payment of principal or interest or in the performance, of the issuer of any Securities. SECTION 4 WITHDRAWAL OF SECURITIES The Securities will be released only upon the Bank's receipt of written instructions from the Depositor. In the event the Depositor is a corporation, limited liability company, or limited partnership, Securities will be released upon the instructions of such officer(s) as are authorized by an appropriate entity resolution ("Authorized Representative"), and the Depositor shall furnish the Bank on or before such withdrawal, certifed copies of resolutions relating to or changing such authority. The Depositor expressly agrees that the Bank shall not be liable for any lass, damage, or liability resulting from the Bank's actions taken in accordance with instructions given to the Bank by an Authorized Representative. If the Depositor has delivered to the Bank Securities subject to a pledge, such Securities will be released only upon the receipt of (i) a written notice by the Depositor or an Authorized Representative, if requested by Bank, {ii) a written release of the pledgee, and (iii) a certificate of the Depositor certifying that the signature of the pledgee is authorized and authentic. SANANTONIO 298076v5 82600-03994 SECTION s STANDARD OIi CARE The Bank shall exercise commercially reasonable care in receiving, holding and handling the Securities. The Bank will exercise the commercially reasonable care expected of a professional custodian for hire-with respect to the Securities in its possession or control. SECTION 6 DEPOSITOR DUTIES (a) The Depositor shall provide the Bank with a written certificate signed by an Authorized Representative containing the specimen signatures of each person authorized to act and give direction on behalf of the Depositor. The Bank shall be entitled to rely upon such certificate until notified in writing otherwise by the Depositor. (b) The Bank is further authorized to rely upon any written instructions or instructions received by any other means and identified as having been given or authorized by any person named to the Bank as authorized to give written instructions, regardless of whether such instructions shall in fact have been authorized or given by any of such persons, provided that the Bank and the Depositor shall have agreed in writing upon the means of transmission and the method of identification for such instructions. Instructions received by any other means shall include verbal instructions, provided that any verbal instruction shall be promptly confirmed in writing. In the event verbal instructions are not subsequently confirmed in writing, as provided above, the Depositor agrees to hold the Bank harmless and without liability for any claims or losses in connection with such verbal instructions. Notwithstanding the above, instructions for the withdrawal of securities "free of payment" shall be given only in writing, manually signed by any such authorized persons. (c} The Depositor may appoint one or more investment managers ("Investment Managers") with respect to the Account. The Bank is authorized to act upon instructions received from any Investment Manager to the same extent that the Bank would act upon the instructions of the Depositor, provided that the Bank has received copies of the instruments appointing the Investment Manager and written confirmation from the Investment Manager evidencing its acceptance of such appointment, or other evidence satisfactory to the Bank. (d} If the Depositor should choose to have telecommunication or other means of direct access to the Bank's reporting system for Securities in the Account pursuant to paragraph (e) of Section 7, the Bank is also authorized to rely and act upon any instructions received by it through a terminal device, provided that such instructions are accompanied by code words which the Bank has furnished to the Depositor by any method mutually agreed to by the Bank and the Depositor, and which the Bank shall not have then been notified by the Depositor to cease to recognize regardless whether such instructions shall in fact have been given or authorized by the Depositor or any such person. The Depositor's delegates shall be named by a certificate provided to the Bank from time to time by the Depositor. (e) In the event that the Bank shall receive conflicting instructions from Depositor regarding any particular transaction, the Bank shall make reasonable efforts to resolve such conflict; provided, however, the Bank may rely upon the instruction first received by the Bank and the Bank is hereby held harmless from all consequences of such reliance. SECTION 7 SANK DUTIES (a) The Bank shall receive or deliver, or shall instruct any other entity authorized to hold Securities hereunder to receive or deliver, Securities and credit or debit the Account, in accordance with written instructions from the Depositor. The Bank or such entity shall also receive in custody all stock SANANTONIO 298076v5 82fi00-03994 dividends, rights and similar securities issued in connection with Securities held hereunder, shall surrender for payment, in a timely manner, all items maturing or called for redemption and shall tape such other action. as the Depositor may direct in properly authorized and timely written instructions to the Bank. (b) All cash received or held by the Bank as custodian or by any entity authorized to hold the Securities hereunder as interest, dividends, proceeds from transfer, and other payments for or with respect to the Securities shall be (i) held in a cash account, or {ii) in accordance with written instructions received by the Bank, remitted to the Depositor. {c) If the Bank has in place a system for providing telecommunication or other electronic access or other mcans of direct access by customers to the Bank's reporting system for Securities in the Account, then upon separate written agreement between the Bank and the Depositor, the Bartle shall provide such service to the Depositor. (d} During the Bank's regular banking hours and upon receipt of reasonable notice from the Depositor, any officer or employee of the Depositor, any independent accauntant(s} selected by the Depositor and any person designated by any regulatory authority having jurisdiction over the Depositor shall be entitled to examine on the Bank's premises, the Securities held by the Bank on its premises, but only upon the Depositor's furnishing the Bank with properly authorized instructions to that effect, provided, such examination shall be consistent with the Bank's obligations of confidentiality to other parties. The Bank's reasonable costs and expenses in facilitating such examinations, including but not limited to the cost to the Bank of providing personnel in connection with examinations shall be borne by the Depositor, according to the research fee set forth in the fee schedule attached as Exhibit A. The Bank shall also, subject to restrictions under applicable law, seek to obtain from any entity with which the Bank maintains the physical possession of any of the Securities in the Account such records of such entity relating to the Account as may be required by the Depositor or its agents in connection with an internal examination by the Depositor of its own affairs. Upon a reasonable request from the Depositor, the Bank shall use its reasonable efforts to furnish to the Depositor such reports (or portions thereof} of the external auditors of each such entity as related directly to such entity's system of internal accounting controls applicable to its duties under its agreement with the Bank. (e) The Bank will transmit to the Depositor upon receipt, all financial reports, stockholder communications, notices, proxies and proxy soliciting materials received from issuers of the Securities, and all information relating to exchange or tender offers received from offerors with respect to the 5ccurities. Proxies will be executed by the registered holder if the registered holder is other than the Depositor, but the manner in which the Securities are to be voted will not be indicated. Specific instructions regarding proxies will be provided when necessary. The Bank shall not vote any of the Securities or authorize the voting of any Securities or give any consent or take any other action with respect hereto, except as provided herein. The Bank is authorized to accept and open in the Depositor's behalf all mail or communications received by it or directed to its care. {f) In the event of tender offers, the Depositor shall mail or fax instructions to the Bank as to the action to be taken with respect thereto or telephone such instructions to the Depositor's account administrator at the Bank, designating such instruction as being related to a tender offer. The Depositor shall deliver to the Ban1c, by 4:00 p.m., San Antonio, Texas time on the fallowing calendar day, written confrrtnation. The Depositor shall hold the Bank harmless from any adverse consequences of the Depositor's use of any other method of transmitting instructions relating to a tender offer. The Depositor agrees that if it gives an instruction for the performance of an act on the past permissible date of a period established by the tender offer or for the performance of such act or that it fails to provide next day written confuynation of an oral instruction, the Depositor shall hold the Bank harmless from any adverse consequences of failing to follow said instructions. (g) The Bank shall not be liable for late submission of any items or information in response to calls for redemption, mergers, tenders, consolidations, reorganizations, recapitalizations, or similar proceedings affecting the Securities when the Depositor has failed to timely instruct the Bank in writing. Should any Security held in a central securities depository be called for a partial redemption by the issuer 4 SANANTONIO 298076v5 8260D-03944 of such Security, the Bank is authorized, in its sole discretion, to allot the called portion to the respective holders in any manner it deems fair and equitable. (h) The Bank shall present all maturing bonds and coupons for collection and is authorized to receive payment of income and principal on other items in accordance with their terms. All funds so collected shall be credited to the Account or remitted in accordance with the instructions of the Depositor. (i) The Bank shall not be liable in damages for any loss or darr~age beyond it's reasonable control, including, but not limited to acts of God, war or terrorist act, fire, storm, or other catastrophe, interruption of transmission or communication facilities, equipment failure, or electrical or computer failure. SECTION S FOREIGN SECURITIES The Bank shall not hold Securities which are issued by foreign governments or foreign companies or for which the principal trading market is located outside the United States hereunder. Should the Bank elect to hold such securities, such activities shall be governed by a separate agreement between the bank and the Depositor. SECTION 9 FEES AND EXPENSES (a) The Depositor agrees to promptly pay upon receipt of an invoice from the Bank the fees and expenses set forth therein. Fees and expenses for the services to be rendered under this Agreement are set forth in Exhibi# A attached hereto and incorporated herein for all purposes, as such may be amended. from time to time, effective upon 30 days' prior written notice by the Bank to the Depositor. In addition, if the Bank advances securities to the Depositor for any purpose ox in the event that the Bank or its nominee shall incur or be assessed any taxes, charges, expenses, assessments, claims or Iiabilities in connection with the performance of its duties hereunder, except such as may arise from or be caused by the Bank's or its nominee's gross negligence or willful misconduct, Depositor shall imrr~ediately reimburse the Bank, or its nominee, for such advances, taxes, charges, expenses, assessments, claims or liabilities, or replace such securities. (b) The Bank may, in its sole discretion, advance funds on behalf of the Depositor which results in an overdraft if the monies held in the Account are insufficient to pay the total amount payable upon purchase of Securities as instructed. Any such overdrafts shall be deemed to be a loan made by the Bank to the Depositor payable promptly upon demand and bearing interest at The Frost National Bank's prime rate plus two percent per annum from the date incurred. Notwithstanding anything contained in this Agreement to the contrary, the Bank shall have no obligation to advance funds on behalf of the Depositor. (c) The Bank shall have a hen on the Securities in the Account to secure payment of such fees and expenses, taxes, advances and other charges incurred under this Section 9. The Depositor agrees thak the Bank's lien shall be a continuing lien and security interest in and on any Securities at any time held by or through it in accordance with this Agreement, for the benefit of the Depositor or in which the Depositor may have an interest which is then in the Bank's possession or control or in possession or control of any third party acting on the Bank's behalf. Upon failure by the Depositor to cure any overdraft amounts, or to reimburse the Bank for fees and expenses, taxes, advances and other charges, within 48 hours after the request for payment, the Bank may dispose of securities to the extent necessary to obtain reimbursement. The parties agree that upon Depositor's receipt of such request for payment„ the Depositor shall not transfer or dispose of any securities except as agreed to by the parties until appropriate reimbursement is made. The Bank shall have all of the rights and remedies of a secured creditor under the Uniform Commercial Code as in effect in State of Texas from time to time with respect to the Securities. SANANTONIO 298076v5 826fl0-03994 (d) The Bank is hereby authorized to charge the Depositor's deposit account number 664012748 for all fees and charges incurred or assessed hereunder. SECTION 10 INVESTMENT RESPONSIBILITY Unless otherwise agreed in writing by the Depositor and the Bank, the Bank is under no duty to (i) advise the Depositor relative to the investment, purchase, retention, sale, or other disposition of any Securities held hereunder; (ii} supervise the Depositor's investments, purchases or sales; (iii) invest, or see to the investment of, any cash proceeds or other cash deposited hereunder and held by the Bank; or (iv) determine whether any investment or sale made for the account of Depositor is made in conformity with Depositor's requirements or understandings. The Bank's duties hereunder are strictly ministerial in nature and are limited to those duties expressly set forth in this Agreement. Nothing in this Agreement shall be construed to impose fiduciary responsibilities on the Bank. SECTION 11 LIMITATION OF LIABII.ITY The Bank undertakes to perform such duties and only such duties as are specifically set forth in this Agreement, it being expressly understood that there are no implied duties hereunder. In addition to other provisions of this Agreement, the Depositor agrees that the Bank (a) will be responsible only for the exercise of reasonable cornrnercial standards of the banking business; (b} will not be liable for any loss or damage to the Securities when such loss or damage is due to any cause other than failure to .exercise reasonable commercial standards, and in any event will not be liable for any decline in the market value of the Securities; (c} will not be considered an insurer against risk of loss, damage, destruction or decline in market value of the Securities; and (d) will not have liability to the Depositor with respect to the services rendered by the Bank pursuant to this Agreement until such time as the Securities are actually delivered to the Bank, it being understood.and agreed that the Depositor bears the risk of loss with respect to shipment and delivery of the Securities to Bank. IN NO EVENT SHALL THE BANK BE LIABLE, bHtECTLY OR IND[RECTI.Y, FOR ANY (I} DAMAGES OR EXPENSES ARISING OUT OF THE SERVICES PROVIDED HEREUNDER OTHER THAN DAMAGES WHICH RESULT FROM BANK'S FAILURE TO ACT IN GOOD FAITH OR IN ACCORDANCE WITH THE REASONABLE COMMERCIAL STANDARDS OF THE BANKING BUSINESS OR (H) SPECLAL OR CONSEQUENTIAI. DAMAGES, EVEN IF THE BANK HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. In addition to any and all rights of reimbursement, indemnification, subrogation, or any other rights pursuant hereto or under law or equity, the Depositor hereby agrees, to the extent permitted by Texas Iaw, to indemnify and hold harmless the Bank and its officers,. directors, and agents {the "indemnified parties"} from and against any and alI claims, damages, losses; liabilities, reasonable-costs, or reasonable expenses whatsoever (including attorneys' fees and court costs) which they may incur (or which may be claimed against them by any person or entity whatsoever) by reason of or in connection with (a) any untrue statement or alleged untrue statement of any material fact contained or incorporated by reference in the information supplied by the Depositor to the Bank or its nominee in connection with the performance of their duties under this Agreement or the related documents, or the omission or alleged omission to state in such information a material fact necessary to make such statements, in the light of circumstances under which they are or were made, not misleading; ar (b) the execution and delivery of this Agreement. If any proceeding shall be brought or threatened against any indenmified party by reason of or in connection with the events described in clause {a) or {b), such indemnified party shall promptly notify the Depositor in writing and the Depositor shall assume the defense thereof, including the employment of counsel satisfactory to such indemnified party and the payment of all costs of litigation. Notwithstanding the preceding sentence, such indemnified party shall have the right to employ its own counsel and to determine its own defense of such action in any such case, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i} the employment of such counsel shall have been authorized in writing by the Depositor or (ii} the Depositor, after due notice of the action, shall not have employed counsel to have charge of such defense, in either of which events the reasonable fees and expenses of SANANTONIO 298076v5 82b00-03994 counsel for such indemnified party shall be borne by the Depositor. The Depositor shall not be liable for any settlement of any such action effected without its consent. Nothing under this section is intended to limit the Depositor's payment obligations contained elsewhere in this Agreement. This section shall survive the termination of this Agreement. SECTION 12 BANK POWER OF ATTORNEY In addition to other rights granted to the Bank pursuant to the terms of this Agreement, the Bank is authorized and empowered in the name of and on behalf of the Depositor to execute any certificates of ownership or other instruments which are or may hereafter be required by any regulations of the United States or any state or political subdivision thereof, so that the Bank may fulfill its obligations hereunder as required in connection with any Securities. SECTION 13 AMENDMENTS Except as otherwise provided hereby, the parties may make amendments to this Agreement from time to time, provided that any such amendment shall be reduced to writing; provided, however, the Bank may, at any time, in its sole discretion amend any of the provisions of this Agreement upon thirty (30) days' prior written notice to the Depositor. SECTION 14 SUCCESSORS AND ASSIGNS This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the respective parties hereto. SECTION l5 COMPLETENESS OF AGREEMENT This Agreement, along with a copy of the fee schedule attached hereto as Exhibit A, constitutes the full and complete agreement between the Bank and the Depositor, and no other understanding or agreement, whether written or oral shall bind either of the parties hereto. The headings of Sections of this Agreement are For convenience only and have no effect on a party's responsibilities or liabilities. SECTION 16 GOVERNING LAW This Agreement shall be governed by the applicable laws of the State of Texas without giving effect to the choice of law principals thereof. This agreement is performable in Nueces County, Texas and venue for all purposes incident to this agreement shall be in Nueces County, Texas. SECTION 17 TERMINATION This Agreement may be terminated by either the Depositor or the Bank upon at least ninety {90) days prior written notice to the other. However, upon request of Depositor, the Bank shall continue to operate as the holder of securities far the Depositor under the terms and conditions of this Agreement for a .period of up to ninety (90) days while the Depositor engages another safekeeping entity. The Depositor shall have a period of thirty (30} days from the date of the last and final accounting provided by the Bank to 7 SANANTONIO 298076v5 $2600-03994 make any objection or claim, and failure to do so within the thirty {30) day period shah be deemed by the parties hereto to constitute accord and satisfaction. As soon as practicable following termination of this Agreement, the Bank shall deliver all Securities to the Depositor in accordance with the Depositor's written instructions. SECTION 18 NOTICES Any notice to be given or to be served upon any party hereto in connection with this Agreement must be in writing and shall be deemed to have been given when personally delivered, when sent by facsimile with receipt confirmed, when delivered by a nationally recognized courier service, or three business days after deposited in the United States mail, first class postage prepaid, return receipt requested. Such notices shall be given to the parties hereto at the following addresses: if to the Bank: The Frost National Bank P.O. Box 1600 San Antonio, Texas 78296 Attention: Custody Services Department Facsimile No.: (210) 220 - 598b if to the Depositor: CITY OF CORPUS CARISTI PO BOX 9277 CORPUS C R~STI TX 78469 Attention: :} Cl~V r ~. i~ Facsimile No.: ~' ~C Any notices served by fax shall be deemed to have been given and received only when written confirmation of the receipt of such fax has been received by the sender. Any party hereto may, at any time by giving fifteen {15) days' written notice to the other party hereto, designate any other address in substitution of the foregoing address to which such notice shall be given. SECTION 19 MISCELLANEOUS (a) This Agreement may be executed in any number of counterparts; each such counterpart hereof shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement. (b) Whenever the context hereof shall so require the singular shall include the plural, the male gender shall include the female gender and the neuter, and vice versa. (c) Tn case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. [(d) The Addendum to Safekeeping Agreement attached hereto is incorporated herein and made a part hereof for all purposes.] SANANTONIO 298076v5 8260Q-03994 IN WITNESS WHEREOF, the parties thereto executed this Agreement as of the day and year first above-written. BANK: THE FROST NATIONAL BANK By: Name: Tom Frost III DEPOSITOR: CITY OF CORPUS CHRISTI By; ,Kr //~~f Name: fi~~ l1~~? ~~~~1r Title: Scnior Executive Vice President Title:_~~ h a e r ~ 1 Z2 I-~ Approved as to term: ~~~ Lisa Agutlar Assistant Ci orney For City Attorney N~~oI ©-~.~ ~~ A~THQRI~Ei~ ~ ~oa~ritr ..rf ~,~, ~,:~.~~ rr~rrar r~v SiEC~~'ARY SANANTON[O 298076v5 82600-03994 EXHIBIT A TO SAFEKEEPING AGREEMENT Safekeenin~ Fees Effective Jule 6,2003 AcoountMairtenance 10.00 p~ 1VbnthperAccount SaFekeepir~ Online 50.00 per MontW 3 services Per Item Charges $10.OOImo basic sa~vioe Fixed Incorr>v Book Entry per receipt 0.60 Equity Baok Entry per rect~pt 1.50 Physical per receipt 2.00 Book Entry per $10 000 ofPar at Month End 0.010 per Month Physical per $10,000 of Par at Month F~-id 0.10 per Month Receipt Fees Security Receipt arxi Clearance Fees On-Frost Transacions Not On-Frost Transaction FRB non ABSIMBS - 20.00 FRB ABSJMBS - 25.00 Non-FRB non-ABSMIBS - 30,00 Nan-FRB ABS~MBS - 3x00 Physical Items - 75.00 Late Delivery Instructions - 25.00 Change Delivery Instructions - 2500 Transactio nal F ees Interest Payment- creditto acct 1.00 Principal Paymer~ -credit to aoct $.00 Called Band Redemptions - a-edit to acct 10.00 Maturities.- credit to acct 10.00 Wire Fee 11.00 Cashier's Chedc 10.00 Pledging Pledge 6.00 Release 6.00 Substitution 12.00 Registrations and Re-Registrations 35.00 Physical examination ofSecurites 25.00 Per Hour Reorgar9zaticns- Tendersand Exchaiges 35.00 Treasu-y Aucfions 50.00 AcoountVerificaiEOn Statements 2.50 (free quateriy} AcoountRes~rch 25.00 Per Hour Incirect Inquries for Lost or Sblen Securities: Sari Amual Charge 25.00 Inquiry 3.00 Over the Counter Collectiars Coupons 20.00 per envelope Bands 20.00 per corpus f postage insurance ProxieslAnnual Statements 3.00 Special Haidling Charge manual intervention 20.00 additional pertransadian ** FROST WILL WAIVE THE $1U.OU MONTHLY FEE FOR BASIC SAFEKEEPING ONLINE SANANTON[O 298076v5 82600-03994 s~ l°i LLIVIEIV'I` NiiriFi~:a~rr~Iv D1=:3DLIx~i ES CASH FAX copy of broker confirm no later than 11:OD am on settlement date. (SAME DAY} OR FREE OF PAYMENT REGULAR WAY, NEXT DAY FAX copy of broker confirm no later than 11:OD am on settlement date. (T + I) SKIP DAY FAX copy ofbroker confirm no later than T + 1. ('I' + 2) ALL OTHERS FAX copy ofbroker confirm no later than T + 3 or S - 3, whichever date is later. (T + 3 OR GREATER) * TRADE INSTRUCTIONS RECEIVED PAST THE NOTIFICATION DEADLINE WILL BE ASSESSED A $25 CHARGE AND PROCESSED ON A "BEST EFFORTS" BASIS. '~ TRADE INSTRUCTIONS MODIFIED FROM ORIGINAL INSTRUCTIONS WILL BE ASSESSED A $25 CHARGE. ~';~'I'CGORl' 1 ROS 1 Sl?C lIR ITS' llL1l~'L,K1' L\S'1EZ~~E I'Ii~N~ Tti"PAS ABA: 114D00093 Government Treasury & Agency FED ELIGIBLE SECURITIES FROST SA/1020 Issues. FAO: NAME/SAFEKEEPING ACCT# DTC #9D1 Municipals DTC ELIGIBLE SECURITIES AGENT ID #80901 Corporate Debt INSTl'I'U"PION ID #26056 Commercial Paper REF: FROST NATL BANK ACCT #096285 Equities FAO: NAME/SAFEKEEPING ACCT# PLEASE CALL FROST BANK SAFEKEEPING TO DISCUSS PHYSICAL DELIVERY SETTLEMENT: 214-220-4138 MUTUAL FUNDS Call your Frost salesman no later than 3:00 pm. REPURCHASE AGREEMENTS Gall your Frost salesman no later than L•O~ pmpm to initiate repurchase agreements. Gall our Frost salesman no later than l D:OD am to request changes to TFN re urchase agreements. FAX copy of pledge instructions na Eater than 3:OD vm. PLEDGESIRELEASES -OR- FAX copy of pledgee releases no later than notification deadlines above far securities being withdrawn from safekee in . ABA 114000093 FED WIRE FROST NATIONAL BK CASH REF: CUSTODY SERVICES ACCT: 280495-20031 FAO: NAMEISAFEILEEPING ACCT# TAX ID 74-0635455 T TRADE DATE DATE THAT BUY/SELL IS ENTERED INTO WITH THE BROILER S SETTLEMENT DATE DATE THAT SECURITY IS DELIVERED f[+f f0 OR OUT OF YOUR SAFEKEEPING ACCOUNT AND PAYMENT IS MADE. SANANTONIO 298076v5 82600-03994 ADDENDUM TO SAFEKEEPING AGREEMENT' NOTWITHSTANDING anything in the main body of the Agreement to the contrary, the Bank and the Depositor do further agree that the Agreement shall be modified as follows, and that the terms of this Addendum shall control in the event of any conflict with the main body of the Agreement, but only in the following respects: The Bank and the Depositor hereby agree to the conditions described in paragraphs (1)-(12) of this subsection: (1) The -Bank shall exercise the same due care that is expected of a fiduciary with the responsibility for the safeguarding of the Securities and far compliance with all provisions of this Agreement, whether the Securities are in the Depositor's possession or have been redeposited by the Depositor with a subcustodian. (2} The Bank shall indemnify the Depositor for any loss of the Securities occasioned by the negligence or dishonesty of custodian's officers and employees, or burglary, robbery, hold-up, theft or mysterious disappearance, including loss by damage or destruction. In the event of such loss, the custodian must promptly replace the Securities or the value thereof, and the value of any loss of rights or privilcges resulting from said loss of the Securities. (3) The Securities shall be segregated at all times from the proprietary assets of the Bank and any subcustodian. (4} The Bank's official records shall separately identify the Securities owned by the Depositor, whether held by the Bank or a subcustodian. If held by a subcustodian, the Bank's records shall also identify the subcustodian. (5) Any Securities that are in registered form shall be registered .only in the name of the Depositor, the Bank or its nominee, or the subcustodian or its nominee. (6) All activities involving the Depositor's Securities shall be subject to the Depositor's instructions and the Securities shall be withdrawable upon demand of the Depositor. Securities deposited with insurance regulators to satisfy statutory requirements shall not be withdrawn without approval of the appropriate insurance regulatory authority. (7) The Bank shall furnish, upon request by the Depositor, a confirmation of all transfers of Securities to or from the account of the Depositor, and reports of Securities sufficient to verify information reported by the Depositor's annual statement filed with the Texas Department of Insurance and supporting schedules and information required in any audit of the Depositor's financial statement whether the Securities are held by the Bank or by a subcustodian. (8) The Depositor or its designee shall at all times be entitled to examine all records maintained by the Bank or subcustodian relating to the. Depositor's Securities. (9) Upon request of the Depositor, the Bank shall be required to send to the insurer all reports it receives from a clearing corporation or the Federal Reserve book-entry system on their respective systems of internal accounting control, and all reports prepared on the Bank's and subcustodian's systems of internal accounting control of the Securities. ~ This Addendum is required for any safekeeping/custodial agreement involving an insurer as defined in 28 TAC Sec. 7.86.- SANANTONIO 298076v5 8260D-D3494 {10) The Bank shall not use any of the Depositor's Securities for the Bank's benefit and none of the Depositor's Securities shall be loaned, pledged, or hypothecated by the Bank or subcustodian without a written contract executed by the Depositor separate and apart from this Agreement. (11} The Bank is authorized and instructed by the Depositor to honor any requests made by the Texas Department of Insurance for information concerning the Depositor's Securities. The department, from time to time, may request, and the Bank shall furnish, a detailed listing of the Depositor's Securities (whether in the possession of the Bank or with a subcustodian) and an affidavit by the Bank certifying the Bank's safekeeping responsibilities relative to the Securities. The Bank's response to such requests shall be made directly to the department and shall encompass alI of the Depositor's Securities (whether in the possession of the Bank or with a subcustodian). (12} The Bank and subcustodian {if any) shall maintain "securities all risks coverage" at levels considered reasonable and customary for the custodian banking industry covering the Bank's duties and activities as custodian for the Depositor's assets and shall describe the nature and extent of such insurance protection. Any change in such insurance protection during the term of this Agreement shall be promptly disclosed to the Depositor. 2 SANANTON[0 29&076v5 82600-03994 ATTACHMENT A SAFEKEEPING AGREEMENT GOVERNMENTAL ENTITY RIDER This Agreement is an agreement between the Bank and -CITY OF CORPUS CHRISTI. Accordingly, this Agreement is modified in accordance with the following provisions of this Attachment: 1. Na Indemnity SECTION II OF THE SAFEKEEPING AGREEMENT AND ANY ANALOGOUS PROVISION OF ANY SERVICE ADDENDUM OR ANY OTHER BANK AGREEMENT, SCHEDULE AND DISCLOSURE IS HEREBY MODIFIED TO REMOVE THEREFROM ANY AGREEMENT BY THE DEPOSITOR TO INDEMNIFY THE BAND AND ITS AFFILL4TES, DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS. ,~. Mandamus. In addition to the other remedies specified in this Agreement, the Bank shall be entitled to a writ of mandamus upon any breach of this Agreement by the Depositor to the extent that is permitted bylaw. 3. Representations. The Depositor represents and warrants that, to the extent required by applicable law (including but not limited to any statute, ordinance or charter), (a) the execution, delivery and performance of this Agreement are in compliance with any competitive bidding requirement and (b) the payment to the Bank of all fees and other expenses properly chargeable to the Depositor.under this Agreement have been authorized by all necessary action, including but not limited to the inclusion of such amounts in the approved budget of the Depositor. 4. Payment Procedurc. If the Depositor is subject to Chapter 113 of the Texas Local Government Code, {a) the Depositor must check the following box (and if the Depositor fails to check such box, this Section shall be of no force or effect); (b) rather than charging a Deposit Account, the Bank shall provide the Depositor with invoices for all fees and other charges due to the Bank pursuant to the terms of this Agreement, and (c) the Depositor directs that such invoices should be sent to the following address and with the following reference (if indicated} for prompt handling and payment: Reference: ^ The Depositor certifies that it is subject to Chapter 113 of the Texas Local Government Code. 5. Execution. The execution of this Attachment by the Depositor in the space provided below, and the affixing of the Depositor's seal as provided below, shall be the formal execution of this Agreement (including the Safekeeping Agreement and all Service Addenda executed and delivered concurrently herewith). The Depositor agrees that it will execute, seal and deliver alI Service Addenda executed after the date hereof in campliance with all applicable law {including but not limited to statutes, ordinance and charter), and that this Attachment shall be deemed a part of each such subsequent Service Addendum. HOUSTON 014861/00009 SSfi892v1 IN WITNESS WHEREOF, the Bank and the Depositor have caused this Attachment to be executed by their respective duly authorized representatives. ATTEST: Name: Title: o ~ ~+~ ~~~, (SEAL) HOUSTON D1k66I1000D9 556892v1 THE FROST NATIONAL BANK i By Name: Tam Frost III Title: Senior Executive Vice President CITY OF CORPUS CHRISTI r By: ~ Nam 1 '~s c ca.r Title: ~ .~ Approved 2ts tE3 ~orrrr. ~• / ~~~.~_ ti_~~-- Lisa Agutla Assistant City Attorney Far City Attorney ~_~ Q ,,... AIU~NUR11l~ ~ ~~~a~~ ~.~~~ ~ ~'~ ~ a s~c~~r~~Y y~• -z-