Resolution 96-847F L ~
U
..._ Chn~~tc~r
)ti Ol:
1
'. mnd ~aAopted
F- v~
ions a. ~rn~ ,.
v,v
~ aye - ~ ~ ,
CITY OF LONGWOOD, FI.OR/DA
INVESTMENT POLICY
scoee
The purpose of this statement is to set forth the policy and objectives governing the investment
m nagement ofthe City's cash reserves.
This Invenmem Policy shell apply to all funds ofthe Cty of Longwood not veeded to meat short-
expenses, except those wet funds and footle related to the iseuance of debt where there are
other aisting politics or indentures in effect. Any debt service requirements or bond covevavts 11
supersede this Investment Policy.
This policy is applicable. but not limited to_ the funds listed below
-General Fund
- Special Revenue Funds
- Debt Service Funds
-Capital Projects Funds
-Emetprise FUnde
- Trust avd Agency Funds
-Any new Cund created, unless specifically exempt
The Finance Direct will be responsible form nt dec and ac uvdu the dire
oC the City Administrator and the City Commiss on. Thesday to day edmirtistretion of the cash
miagem nt program is handled by the Finance Dire r. No pars may evgage in an investment
xcept as provided under that softhis policy and the Drocetlur stablished. The
City ety appoint av outside investment m neger as "Agent" for the City's eashsreservea
Those persons authorized by the banking services agreement then in elfem to inmate wire transfus
will be authorizeU to enter into investment transenions on behalf of the City.
1~ VFSTM1IEYT OBJECTIVES
The investment objectives for the City's oash reserves shell be to ensure the safty of investmeot
principal. provide for liquidity. and maximize investment income (yield)- Funds ofthe City will be
~ vcated in accordance with Florida State Statute 218.415-these policies and written adminirtrative
procedurea The City's invesment ponfolio will be managed in a manner to attain a market rate of
n throughout budgetary and economic cycles while preserving and protecting capital in the
erall ponfolio- investments will be made hazed upon statutory constraints evd subject to the
available designated sraBing capabilities.
PEAFORitANfF MEASUREMENT
The State Board of Administration Loal Govemmam Surplus Tnist Funds Investment Pool shell be
used asaperfotm t. For dailyreporting purpos s,thepool's"Inv nt Retu
which isa 30-0eym ving avenger eof rGerq will be milized.eFor monthcnd rep ns, the pool's
"Panicipam Retem'", which is theaaetual yield for the given month, will be used as a pertormance
The Fineoce D"vector will make every eR n contain an average ate of return Por the ovenll
portfolio that equals or exceeds the pool's rare.
The standard of prudence to be applied shall be the Prudent Peron Rulz which axles
'!mr s.shaA De made wirF judgme and car ,n,der - s then
n'clse f
prroalfing,rwhiJ, perx s~ o7Prudenu. drsa and maUlgene n the
nmgem nl~~me„do-:, no~,:7~„rnr,e trrnfr„ o,,,~dwG~fl
n~ pro~cre Mm~>rr,eo- e~narrnrenar,haprar,dhle melon ey~a eetden~ed~a,,,
me,,,ver»»e,,,.
The Prudent Person Rule shall be applied in the comext of managing the overall portfolio.
OtGcersaM employees~volvedintheim nt proc ss shall rebain firm pars nal bun ivity
that onflict with proper n of dren nt program impairs otheir ability tocmake
impartial investment decisionsotlEmployaes and nvestment officals shall disclose any material
financial interests the, could ba related to the performance of the City's investment ponfolio-
The Fina ce D'vector and s1afP, acting in ccordanca with written procedures and exeroisin6 due
diligence. will cot be held parmnally responsible for a specific sewnty'r credit (default) risk or market
price changes, provided that these dart s ar repotted immediately and that approprian acnon
is taken to control adverse developments.
APTAORIZED INVESTMENTR
The following is enlist ofauthorized securities for investment. Revixions to the authorized list
of se maybe made Gom me by action ofthe City Com n. The Cty is Dermitted
to invest irn pools that m tum,nvese ,n rcuns the Cary may not purchase d'vectly_
The City is authorized under Florida Statutes to invest io the following
A. The Local Government SorpWs Funds Investment Pool. any
tergov mat N nt pool authorized pars o [he Florida Interlocal
Coopuation Act, as provided for in Chapter 163 Ol F.St r
- No maturity limbs apply.
-Portfolio mix shell be 10%to 100%.
B. Securities Exchange Commission registered money market funds with the
highest credit qualityrating Trom Dally recognized rating agency.
-Maturities must be two years or less.
- Portfolio mix shall be 0% to 10%.
C. Savings accounts in stme~w'tified and qualifies public depositories. as defined
in Chapter 280.02. F.S.
-Funds most be accessible within one business day without penalty.
-Portfolio mix shall be 0%to 5o%.
D- Cextificatea oPDeposit in stetecertified and qualified poblio depositories, as
defined in Chapter 280.02, F.S.
- Mam st be two yea or less.
- Portfolio mu shall be 0% to 50%.
E. Direct obligations ofthe U.S. Treasury
- Matu st be five year or less
- Portfulio mix shall be 0%tos90%-
F- Federal Agencies cad Instrumentalities
- Maturities must be fve years or less.
-Portfolio mix shall be 0%to 50 o Por these instmments, inolusive of
all types.
The Ciry is further authorized by this Investment Policy to invest in the following:
G. Repurchase Agreements collateralized by U.S. Treasury and/or Federal
Agency securities and Marked-to-Market.
- Matu st be within week.
-Portfolio mix shall be 0 % to 50°u
H. Sec s o~ or othor any openxnd or closed-end managem
type investment company or investment ttust registered under the Iovestmeot
Company Act of 1940. 15 U.S.C. ss. Boa-I et seq~ as amended from time to time,
provided the portfolio of such in ompany er is limited to
United Stat s 4ov oblignu and t tparchase ragreements billy
collateralized by ouch United States Oovamment ohligations and provided such
ompany o takes delivery of such collateral eithu
directly ortthrough an authorized cuetodiaa (i e. Mutual Fnnds)
-Mara n be two yea or less
- Potfolio rmx shall be o°o tosl5%.
The City will not hold or purchase any fomr of derivatives. A "derivative" is defined as financial
men4 the value ofwhieh depends on. or is duived Gom, [he value of one or more underlying
index ut values. The ure ofreverse repurchase agreements or other forms oPlevuage
as likew se prohibeted.
MATT RITY AND I IOUIDITY RROIRRFMENT4
Maw es shall ben ared so that known cash veeds are met o a periodic besix or as otherunse
requested by the Ciry Commission.
fequidry shall beassured through prat ring that the n xt disbars nt date and payroll date
verM rinough ovemigM delivery vsf payment repurchase agreements or State Pool funds. At
Ieas~10 pereem ofthe portfolio shall be held in such insttaments.
The Fns ce Dirac r shall diversity use of invenment innruments to avoid inearting unreasonable
risks inhue ring in specific i indvidual broken or financial in
through which in are bought and soldstist x Diveraiflca rategies shall
be reviewed andvrasv sad periodically, as deemedsnecessary by the appropriate mevegement Hoff
Cretlil Risk
<Knimizing Credit Risk will be accomplished by limiting the maximum percentage That may be
invested in any one en[ity or instrument at any one time. as eatlined iv this policy-
Marktt Risk
Risks of markw price voletiGry shell be controlled through maturity diversification within the
limirations established by this policy.
AUTHORIZED INVES STIT TI N AN DE R
Banks
The City shall purchase cenificat s of depoeit only through qualified public depositories of the State
ofFlorida as idamified by the State Treamrer, in accordance with Chapter 280 of the State Statutes.
Other may be purchased through those fine cial in which provide the sernces of
a.secunues dealer. Such banks should haveabranch ofioe located within the City_
Brokers/Dealers
The City shell utilize only government securities dealers as designated by [he Federal Reserve.
Exceptions mart be authorized by the City Commission.
All in s, dealers end is utilized by the City of Longwood m capital adequacy
guideline aodnetmined by thew Bespec regulatory agen and oertifysthe[e rial adve
is hxv erred sin e the i e of their nt five cal st s_ They maust also agree
oti~ the City iv them s of m rial adver a affectengntheir capital adequacy. All
secant es purchased shall be oNy those secunnes o(euthorized iesuers ofthe various security types
Lists of authorized institutions, dealers and issuers of the various security types will be maintained
and reviewed pexiodicelly by the Fivanee Director.
Criteria f r addition to or deletion Crom the hat will be based on the Collowing:
1. SYete l.aw,
2. City's Ordinan e, Code or Invenment Polity requir merits,
3. Financial condhion,
4. Consistent lack of competitivenccs.
5. Expeti or Lmiliarity of the account representative in providing service w
nnal ac and/or
6. WhendevmedinthesbestinterestsoftheCity-
Before engaging in any inn with en institution, the Fnance Director must receive
end maintain ov file the PtthlicU my 6imes Srntemertt and a signed certification form attesting that
the indvidval responsible for the City's a with that firm has revieweU the City'a Invenmem
Policy end agrees to undertake reesoeable efforts to preclude imprudent transauions involving City
funds.
All securities puchased by the City under this policy shell be properly designated as assets of the Ciry
of Longwood and shall be protected through the use ofathird-patty custody/safekeepinK agent. The
agent shall issue a safekeeping receipt to the Ciry listing the specific instrument, rare, memrity xnd
other pertinent information.
No withdrawal of securities. in whole or in pan. shall be made from safekeepine, except by an
authorized staRmember of the City of Longwood.
Iv order to guazantee delivery of securities before paymen released, all securities purchased by the
Ciry under this policy must be purehered using the "Del very vs. payment" procedure, if applicable,
e that the c nodian will have the security or money, as appropria , in hand at the conclusion
of the ransecvon.
An exception to this method of control will be the safekeeping of norrnegotiabla bank certificates of
deposit which would require physical delivery without systematic handling found commonly with
book entry securities. These items shall be kept in a safety deposit box maintained in the Citys name.
Any authorized in - with whom the City traneaue repurchase agreamevts must hav ov file e
fully executed copy ofnihe PSA Master ftepurchuse Agreem¢m. All repurchase agreement
transactions shall adhere to the requirements therein.
DID RFOL!IREMENT
The Finance Director will routinely monitor the contents ofthe portfolio. the available markets and
the relative values of competing ioettument4 and will adjust the portfolio accordingly.
When pwchasing or selling securities, the Fierce D'vecwr will setae[ the security which provides the
hlghen a of return witkn the parameters oCthe policy, end given the curtent objeotives and needs
of the City's porfolio. These selections.shall be made nnlizing one of the following methods-
1 Competi ve bids, whoa n the City solicits yuo es Rom a mtmmum of three
firms. when such method is feasible and appropriate t
Compari o the ourrent market pric indicated by one of the merf:at
pri<rnK re vailable o the City. such ass the Wnll Stree[ Jortrna{ o
comparable net ovally recognized financial pu6licanon providing daily market pricing.
In .the City will utilize the compoti ve bid proc soled the recurities to be
purchased or soldnsRecords will be mat eined for iN'otmehonel putpos sand future reference which
disclose bids solicited. offered and accepted.
Select on by compari marktt pric indicated above, may be utilized when in the
judgme of the Fina e Direo ompetitiva bidding would inhibit rho praa select the
to bepurcnas~ or sold, when the sec City is unique to a single dueler or when the sacumy
is a new issue and is sold at par.
The Finance Director shall maintain a system of imemal controls which shell be reviewed annually
by the ex[ettral auditor. The controls should be designed to prevent and control losses of public funds
sing from fraud, employee srepres on by third part imptvden ns by
tes o
employees cud olHceis Controls may include, botasliould not be limited for the follaunng o
a. Cuarod al safekeeo'oe
Secudxies purchased from any bank or dealer, including appropriate collateral.
should be placed into a third patty bank for safekeeping.
b. A 'd ~ fb a reEyri~
Bee u-form uch ea o pars naI urethan era
secunne refit tared n the name of the Chy oPLOngwood o
c. A 'd fpl Id I ~.
Book-entry sec u<h easier to traKfer and account for, since actual
delivery is ne takenm physical delivery sec st be properly
se<guarded as any valuable doe s. The poteni al for fraud and Ions
increases with physical delivery securiti s_
d. CLLlg~lggation of anthorin oat~IQlnemFer<
snbommate taRmembers moat nape a char nnaeratandmg oftneb amhndty
and responsibilities to avoid any improper actions. Clear delegation of
authority also pres s the i mal co rol st a that is built around the
various staff positions and their respectrva responsibilities.
e. Docu a oi'transac and strateaies
All tm end the strategies that may have been used to develop them
must besdocumented in wr ring.
e oe I_ r ~=f ~ ~ n h n k
rniaaareem r:Howe omlfne me van scemrwa arts ser dry prometoas eor
making and rece,ving w re iransf
RFP()RTIN(]
The Finance Director shall prepare ual o re freque report oP investment a vity for
submi o the City Com n Such reports shell describe thm s n the portfolio
of clan ortrype_ book val e. market value and yield es of the report date Such reports shall be
availeble~o the public.
The Finance Direuor will provide other such reports and information as deemed reasonable upon
request fiom other ivteinal end external pnnies
The City shall comply with Government Accounting Standards Board (OASB) requirements
~( .., 1(,~ j Uritg of ~nngfnnuD
"CERTffICATtON"
I. .hereby cenil~ [hat 1 have reaU the Invevtment Policy of
the City of LOVgwoo4 Plorida (whe Ciry"). As Neiudividual primarily renpovsible for the Citys
with ,1 agree to undulake reasonable efforts to
preGude any imprudent nansaohons involving Ciry funds.
I further certify that hae met all capital adequacy guidelines
es dexerznived by all applicable regulatory agencies, avd ghat no material adverse events aff ivg this
film oepital adequacy hav urred si a the eof ou nt fiva eial nt s 1
agrw ro notify the City ifany adverse events should occur which would aRttt the capital adequacy
of this firm.
Signed
Title
Date
Count rsigned by company president or person ir, charge ofgov mend aecunt~ s operauons_
Signed
Title
Date
Fnhxn g~Fe Quahcy of Li(~lor Oar Ca~.~~:
TATE,SU;NT UNDER SEC[)oN E9'/.)]] (])(a),
FLORE) oN PUBLIC ENTRY CRPffS
NED M THE PRESENCE OF A NOTMY PUBC[C OR OTHER OFFIGUE AUTHORED TO
M MoATHS.
,. 13i>,warn .uum.m .a rvbm~nea ipaw nwea( public eeuryl
. a ~c a i ..N Emp)oyee Wenoficuuo N~mxa CiEA~ ~.
til me o ry O o FEpI, iucluee we 5«w Savory Numeer of w. imiNeu+l aiµin¢ rda uwn wemeu
_. ]]f)NV. Flora
OeaUoive Suru.(ivclueice, Eu mi: limiud
]. Ul(IHBI. Flog
rwpet by~oaicwa~ or ivfacmwov)aePar fulY t g 1989, v a nmLL a ) ry ca~a.
+. i~m.rum uum .(fiEam ..e.fiweie P.nS.ap6281. t]](t)(+). Floe. SV
.~in%~ ~.riu~a~~)wamw `aar~a~~ a~«w ..~.~ n..,
~vee or
.~i:uu' ~+sa.m<o<+mR tie
ur
x ao~a..,~a ~>,r-~ ocoo„c,.ea p ~a n m.mno~m e~.ma P a maem. a,~)
,. ]unto. FlaH
a )<w pa*
6 ,~~.~,m.«~.„~~.~'.P~,,e...muE~a~~a.,.w<,on~wooe~.. rynem ,
m..e
_>b..oon >uF~~n,
mcry o~m etfilisu o(mee cry
t9s9. No~.ee, wee.6u Wn a
de Hearne OTfiece raem~mc~iud NuS~.aanr o~w 0e public inu nmw place We a ory~rvpmi~itine Wig
.wom varemem on ue conv~<W .emae Iw. lau+t • coPF o[ We fiW wGrl.
SUBIMSSION OF THIE FORM TH Tee CONFAACTING OFFICEe FOR THE PUHG[C
ENTITY mFNIH® PIN AGGRAPe I IONEi AeOVe LS FOR THAI PUBLIC ENHTY ONLY AND, THAT 2 5
THROUGH DECEA®Fx Jt OF lHE CALFNDA¢ YEAR IN x'INC8 R IS FIIt9. [ AL50
IMDERST THAT [ AM H£QOHIED IO INFORM THE PUBISC £NTFTY PWOe TO EN[PRING H+FO A
CONTRACT M EXCESS OFTHE THRESHOLD AMOUM PAOVH)ED IN SECHON }klAt>, FTnRH1A 3!'AT[
F00. CATEGORY TWO OF ANY CHANGE N' TeE USFORMAHON CONTAIN®M tB(e FORK
,oop
" ~' h5f~1
Telephone (2t 2) 004000
MASTER REPURCHASE AGREEM ENT
AP4licab'rlity
ny("Seller")agre¢s to
er (`BUyer'i Asa m1'nSeopnnes') agelnst tnetrenster of tuntls
urltles or linanclal lnslrumen
oy Buyer, won a simultaneous agreement by Buyer to hander to SOltmr sucM1 Secun[es atebate certain or on
b. against the iransler of luntls by Seiler Each such transacfon shall be relerretl to M1erein as a"Transaction"
be 9ovemetl by ibis Agreement, inclutliig any supplemental terms or contlitions wnlainmtl In gnnox
I Fereto, unless othanwse agreetl in wrliing_
2. Oefinllfons
(a) "A enpy'", witn rasped to any parry, (~ the mmmennement by soon perry as debtor of any
bing antler any banWUptry, Insolvency, rmorganiza0on. fiquitlatlon tllssolutlon or slmltar law, of
M perry sacking the appoimment ola receiver, trustae.< stoSan or slmter oXieiat for such parry or any
or (the deny against s~cM1 party
or another se king supers an ayppolntmen4 or~ne tliing agalnsl ayparrynot asn appli et on fora protective tlecxes
III)the mattirxq by a party ota general assignment or or liv)tna aJmission in writing
r pany's'inabity to pay suM pony's tlehtsbasmtheylbecome clue;
y a pbarty pt such
( )"ntlblilonal Wronaseb SewAiles". 6eourltles proNnetl by 9a~ar to Buyer pursuant to Peagrapn a{a)
rerelOCt' Ecyets Margin Amount', w respect to any Tramsaction esol any bate, in
e percentage (which may be equa(tp the percentage ifiat is agreed to aziheu5eller's~Maeg n
~ntler subparzgapn (qJ of this Paregrapnl, agme0 to by Buyer and Seller prior to entering Imo fha
i an (tll!!COn n 3(b)ne
le)'t espec Y Y e, y p opa inereol then pay o and all mtarest,
b vitl(, tlMarginn liatl In n a(al neee
(g)"Marg~gExce~sshihe meaning spenOeC liP Pamgrapn a(bl hereof',
(M1)'M ny Securltlas as pt any date, the pace Ipr ouch Beuirltles on stM
me bNe extent not 'IneIYtlEU' Iherei er Nan any Income
en (oth
obligations oi. Seaer pursuam to Paragraph s horebi)as of spch
tl ee (unless cam a rya maMal Pmctiee for soon SeeunGesl:
(1'v
yapprc~ cng Rae
~cirng on fanU incwa n91
ne t'ur~rnase Data Bloc sucnsTransacuoo anU enUprg onNu tle.actugUing)piha bate of bet nn lrebueea b
Y
y amount of sum f'nce Gitarenia t e iou, y pa by S¢lior to y wah espoct to such Transact on);
(j)"Pdcin9 Rate",the per annum percenfaye rate lDr determination of the Price Dillerenfial;
(k) "Prime Rafe",fhe prime rate of U.O. money <enfer wmmercial banks as publisnetl in the N211 Sheet
Journal;
(I)"PUrchase Date'". th ch Purchased Securities are transferred by Seller fo Buyer:
m)'Pe a", () on Wrcnase Date, Ina prra of wM1on Purchased Securities are nanslerred
rid (il tnereaffeei, such price tnceeased by lne amount Dl any cash uanslerretl by 0uyee to
Sellaer pursuan~fo Paragraph a(b)M1ereof and tlecreased by the amount of any cash bansterred by Seller to
Buyer pursuam to Paragraph d(a)nereof or applied tD reduce Sener's DOligalions antler clause (ii)of Paragrapn
5 hereof:
(n)"Purchased aequdtles'",the Sacurlllas transferred by Seller to Buyer in a Rensactien hereunder. entl
any Sesudfles substlWfetl lnerelor In acoordenee with Paragraph 9 hareDL The term "Purchased Securities"
respect m nr r r~s~.r~¢n at any rms also snail imgde Addltignal Pur<hased seevdees delmered pursgam
f aregraph d(e)antl snail exGUda Sewrlttes relurnetl pursuant fo Paragrapn 4(b):
P (o7"R se Data".the bate Dn wln'ph Seller uto repurchase fhe Pnranesetl Securities from Buyer,
i cluding any date determined by application of fhe prpNaions of Paragraphs S(e)er
(p)"Re cn Pueehasetl SeeuRies are to be transferred fmm BUyer to Seller
h will be detarminetl,n each case pncludng Trensaaions terminable
upon tlemand)as ce Dillerenllal es olthe date of such tleterminetien,
Purchase Pdca and the Prl
i asetl by any amount defarmined by fhe apptlpallgn of lne provisions cf Paragrapn tf hereof:
cra(g) ,Sellers Margin Amount", with respea to any Transaction es DI any date. Ina amount obfalned by
application ola percentage (which may be equal to lM percentage that is agreetl to as the Buyer's Margin
aragrapn (c)ot this Paragraph), agreed to by Buyer end Seller prior to entering into the
ransacnon, D e e u c ase rice or such Thansaceon as of sucM1 dale.
T3. In n; CDnftrmatlon; Term atlon
(a)'An agreement to enfer lnfo'a Tansaction may Oe made orally or in wilting at the inilatlon Dl aithe~
Buyer or seller On the Purchase Dale (or the Transaction. the Purchased Securities shall be transferred tc
its agent against lne frarrster of Ne Purdtase Pdea to an account of Bellec
uY (b) Upon agreeing fD enfer'mto a Transac~nn hereunder, Buyer Dr Seller (or born), a e agreatl
all promptly deliver to fhe other pedy a written cenfirmatlDn of eacM1 Transaption (a "COnlnm~a~ion"). T
codrrmenon shall besgrm Ina PDr<nasea secgm~as naupamp cusw nembee n an.)_ ~eemnv e¢~er am
(b)11 gregate Marxet value of an Pumnasetl Securni¢s sub7ecl to all Tmnsacll¢r~s In
zr parry herete is acfirTq es Seller exceabs ine aggregate Sellers Margin Amount for all such
me (e ' ss'), Ihen Seller may by noliceto Buyer require Buyer in such
ed Seoumles to Sailer, so trial lne aggrega¢ Mark¢t
ed Securities so nansterted.
¢ ng9regae Marginc mflnc Y Magin
E c er).u
x ") as nl to nxs Psagrap shell ee annealed to sucM1 TrereacnDns as shah be
agreed upon by Buyer anaeSallersua
(tlt Seller and Buyer may agree, with respept to any or all Transactions nereunder, that the respective
of Buyer or Seller (pr npN(un aregrephs (e) antl (b) of this Paragraph maybe axarcked only
Margin Ex tleer~seubpeeds a speciped tlpllaramount ora spedlletl perranlage of the
Repurcnasa PAces foetsuen Tmrwacl'mns(wnlcM1 amountor percentage shah be ngreetl to by Sayer nntl Seller
a Fetl¢ral Reserve Bank, or (i~ shell be Iranslerred by any other melhotl mutually ettepteble to Seller and
8uyec As used herein wlh respect to 3epufities."t
inSection e-3t3 or the New York Uniform COmmercialCOtle oSawnare ppllabta sn any (ederlalgregutafion
governing transfers of the Securities.
8. Segregation of Purchasetl Securities
y eppapabte iaw, aii Ppronasetl Sewhfms'in the possession of Seller shah be
segregatM hsom ptherOeseruntlasin its possession and snali be idenfiAetl as mb~ern to this Agreement Segregation
maybe accomptisned by appropriate itlentilication on the books and recortls of the M1older, Inclutling efinenciel
metlleryora cleahng wrypra<orl Title to ell Wrchesei Seventies shad pass W Auyer and, unless oNarulse
ed by Buyer and Setter, nottnng .n tnls Agreement snap preclude Buyer hom engaying in repwenase
he Purcnased Securities or otnerv+ise pledging or nypotnecahng the Purchased Seventies.
s obilgahoas to transfer Wrcnasetl Sewralesb Server OUesuant
aragrapns as a is obfigatlon tp cre6~t or poy lnooma to, or apply lneume to the
of, Selle~pursuanta~o Para92pne5 nareoL
chops in W mm~ the Setter Retains Cus ody
o hSe er es not permitted to substitute other seounhes for Rtose sudject to this Agreement antl
eeD Ruyers securtlies segregated at all times, u nt Buyer
Qs Sella ergs
to Setleesown secu9aesndrlrbaygfhe tratlin9eday
d ng Bey to Sen
Y I: ill' Imnyj'aa «s guaa o lira nxI' Imi
aeslp6 by Seue~~ifor aeo.e~es on on~r sec imies o-aasaet Doge w
meng6ed. Seller's abauy to resegragare su e
ep Seiier's ab~my ro satAty line ng~'(aayl" lea r .n u ~u un~
9. Substitution
(a) Seller may, subject to agreement with antl acceptance by Buyer subsfilule other Securities for any
Purohased Securities. Suoh substllufion shall be made by transfer to Buyer oI sucM1 other Becudtles antl
fo Seller of such Purchased Securities. After substifWOn. the subsRUfotl Secunlles shall be deemed
to be Purchased Secutlfies.
(b) In he Seller retains custody of Purehased Sacurnies. the paNes expressly
agree that BUyasi shellnbetl emetl,for purposes of subparagraph (af of lhts Paragraph. fo have agreed to end
s Agreement substitution by Seller of other Securities for Purchased Securilies;provitled.
howevertl, thallhsuch other Se¢urtlles shall have a Market Value et least equal to the Market Value of the
Purcnasetl Securities for which they are substituted.
to. Representations
Each of BUYer and Seller represents antl warrants to the other that (il ifsduly autnoelxe0 fo exe¢ule anc
deliver this l~greemenl. to odligafione
euntler antl has taken all necessary ac0onalo autnorpe svo aexe¢utlona delivery arW pedormanna, (lift
al (or (agreed in ling in ny Tran on by fh
parryrM1erefo. as agent ba e'd sclosednpdpnclpal'(III)the parson slgnin9vlM1ls Agreement on~fs behalf is dolt
u aamufo lne pfnarl~s mabuiy ld, urea mtemmn not m. pe orm v yap g pns harapnaar laapn an
SEVenf of Defauk"f:
(eJ At lh op o[fhe nondeYaulfin9 petty, exercised by wriden notice to the defaulting party (whim option
Repurchase Oate as determined pursuant to subparagraph tat of this Paragraph
(dec y by (A) any amounts retained by the nondclaWting parry with respect fo such
ce pur~sudant to clause (ill)of this subparagraph. (Bf any pro¢eetls fmm the sale of Purchased
SecpurhtessWrsuanl fo subparagraph (d)(If of M1is Paragraph, antl (Cf any amounts credited to the account of
Iftng party pursuant fo subparagraph fef of Paragrapbf on a 380 day per year balls for the actual
umbeaof days during the period feom antl Includng the dale of the Evem of Gefaull gtvtrtq else to sucn option
Io but extludiny the dale of payment of the Repurohase Price es so increased. (ill( all income pall adar sucn
mad exercise snap be retained by the nonaefaulfing party and apptietl to the aggregate unpaid
d by the defavifing party, and (ivf the
n parryany MrMased Securlfles subject to su<hRense¢aon~s0~enin th dafaulmregdv lHy deliver to the
rry5pusseason.
ond(cf In Ifing parry is acpn9 as Buyer. upon lendae by the mndefeulfing
party of Daymenf of tthenaggregate Repuurchase Prices for ail such TranseGions, the tlefaulfipq party's right,
antl interest In ell Plrphasatl Securities subject to such Transanions shall be deemed frensfened to fne
nontlefeulling party and the tlefaulfing party shell deliver all sucn Purchased Securities to the nondefaulting
PaM
(df AHer one business day's mice fo fne dafaulling party (wnlM noYwe need not be 91ven Il an Aof of
ay ba Ina notice given under subpamgrapn (a) of Utu Parayraplr
or fne nol~ce referred fo In clause pit of fne lirsf sentence of Ihis P 9 pnl. the nonaefau g p y y
aggregate unpaid Repurchase Prices and any otnei an+ounfs owing Mfne tletaulling party hereunder
or 1R~ in I~ sme mscrenpn elect in iia¢ or sawry an pr a pomon or,,,ah Purrneaed 5
Icing parry credit for such Purchased Securities in an amount equal lp tM1e pd
ained rrom a generally rerognixetl source or the most recent ciosinq bitl Or
ebagainst the aggregate unpaid Repurchase Prices aria any orherampunis ew
parry hereunder', antl
(11~ as ec (Ar
('Replacement servn6essr poi I e same ctllass'ena amount as any aWrchesetl se
mme nonaeta nmg paM(O wlm respect to P¢rrnesea sec¢ra~s(omur than Adanronaiwmnesea Seowntes)
oe for suoh Purenasetl Eecurliles antl(li)witn rasped io Atltlitlonal PUrcM1asetl
Sec a (or paid) by to paM io m Sec
aulting pally span be habla to lhennondata~ting parryrohantReeest on suaM1 remaining
ermryr ~`~?despectptoa ach sucM1 purchase (or deeme0 porcnase)ol Replacement Securlles room the tlete
se (or tleemea pumhaso~antl peitl in foil by buyer. Sueh rnierest shah be era taro equal to the
g clog Rare rot such Trensacaon er the Prime Raie.
realer FO aragraph tt, the Repurchase Pac¢lor each Transaction hereunder .n respect
pdefaWeng parry is cling as BUyer shall nor increase above the amount or such Repurchase Price
for such iransa<tion aeterminea as of the dare or the exercise or deemed exercise by the nonderaWing paM
paM w
ggree ding upon ennd snarl inure ioene benoihcor ine parti
assig s,aT on g
T2nsaceons then oulsle Umy' ~ g moni snarl, nolw.Inslen g cn nauce. mmain eppnr
-16. Governing Law
This Agnomen! shall be governed by lne laws of Ina Stare of New York without giving eXeci to Ina conflict
of law principles Hereof.
1 No Waivers, Etc.
express oeimpfietl waiver of any Evam of Defaulrby either parry snail consifute a waiver of enY other
Event of Default antl no exercise of any remedy hareunber by any parry shall constitute a waiver of Its right
any Omar remedv hereunder. rvo mbtluicarpn pr waiver of any promaion onma ague aria rip
nt by any parry to a ellectivo unless antl win such snail be,n wnXnq and
tluly axecutetl by OorM1 of the paniesnnsreto W any of me foregoing, In to glue a
ursuant to subparagraphs 4(af er 4(b) henol wN oot c¢nstlute a waiver of any dgnt fp Oo so aI a later
te. Use of Employee Plan Assets
(e7 It assets of an employee baneht plan subjeG to any pmhsion of rn¢ Employed Rotir¢menl Income
Gecunryactof lg]4 ("FRIBA"f are tnrendedto be used by eitherpanyhereto gne'Plan Perry'f inaTransecnon.
noery me Omer parry prior m the nansadlpn. r PaM sn 'eing
shall so a an an represent in wr
to the olhee parrythat the Tansaction tlces not wrlsliNte a pronlblted transacl'wn under ERlSa orls otherwise
Seller In any outstantling Transaction Involving a Plan Parry
P I(a) The parries recognize that eau Transactien is a "repurchase agreemen
6edlpn tOt of TIIIe I t of the United Brans Gode, as am¢nded (exc
ch Tran
c isedelined inuSeUions'Qonr TOiuld leoldlne Uhheo'6latesC
onir(bJ its her porty'srlgMmllquldale 6ecudties deNeretl foltin
eundasor ro axe a anyotherremedes pursuant to Pengrapn t I hereof. is s
20.0 tmq Io Certain Fetleral Protections
wietlge that tney have been atlvlseo friar-
(a) ~ o~ Transapllons,n whtcn one of the parries 5 a broxer
nange Commission ("SEC"(under Section t 5 of Ina Sec.
("t 934~ACta).dtllexSeeurities investor Proteclton Gorporaflon has taken the p
he Securities Investor Pmtaction Ad o11 g]0 ("SIPA'] tle not pmlect the or
Ten'b, tiln
provide pmtectioan'I~o meeo ner perry w~ respect IoEany Transact o~~ M1ereun
(cl ,n of Tnnsacrmns in whlon one of Ne parries isa financial
Depose I sura~ceTCOrporation,ene FetlerafaSavings antl~L¢
the Nali ~al Cred1 Union 6nare Insurance Fund, as applicable.
ANNEXI
pV enYal terms and Conditions
ANNEX II