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HomeMy WebLinkAboutContract 41645 (2)CITY SECRETARY CONTRACT NO. 4110 Lk . GLOBAL SECURITIES LENDING AGENCY AGREEMENT This Global Securities Lending Agency Agreement, dated as of April 1, 2011 (this "Agency Agreement"), is entered into by and between (i) CITIBANK, N.A., a national banking organization (the "Agent") and (ii) CITY OF FORT WORTH, a organized under the laws of (the "Lender"). Capitalized terms used herein without definition shall have the meaning assigned thereto in the Lending Agreements (as defined below). WHEREAS, the Lender wishes to appoint the Agent, and the Agent is willing to accept such appointment, to lend certain of the Lender' s securities upon the terms and conditions set forth in this Agency Agreement. THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Agent and the Lender agree as follows: 1. Appointment and Acceptance: the Agent's Authorization. a. The Lender hereby appoints the Agent, and the Agent hereby accepts its appointment, as the Lender' s securities lending agent with the duties and obligations set forth in this Agency Agreement. No covenants or obligations not set forth herein shall be implied as a result of this Agency Agreement. b. The Lender hereby authorizes and directs the Agent to arrange and administer loans of securities (the "Loans") maintained in accounts listed on Exhibit A or as agreed upon by the parties from time to time (such accounts, the "Designated Accounts" and the assets and securities contained therein, the "Securities"). Securities that are the subject of a Loan shall be referred to as "Loaned Securities". c. The Lender hereby authorizes and instructs the Agent to enter into Loans on behalf of the Lender with the entities identified in Schedule I hereto or as otherwise identified by the Lender in writing from time to time (each, a `Borrower"). d. Prior to arranging a Loan with a Borrower, the Agent will, on behalf of the Lender, enter into lending agreements substantially in the form of the market standard agreements listed on Schedule VI hereto (such agreements shall be collectively or individually referred to as "Lending Agreements"). The Lender agrees to be bound by the terms and conditions of each Lending Agreement entered into by the Agent on its behalf. 2. The Agent's Services. In addition to the foregoing, the Lender hereby authorizes the Agent to perform the following functions: a. To negotiate rebates and/or lending fees with the Borrowers. b. To collect from Borrowers the cash, securities or other financial instruments that will serve as collateral for the Loans ("Collateral"). The Lender hereby authorizes and instructs the Agent to accept on behalf of the Lender as collateral for Loans the types of financial instruments identified in Schedule II to this Agency Agreement. c. To enter into and sign, as agent for the Lender, such documents and instruments, including but not limited to repurchase agreements, tri-party agreements, subscription agreements, asset management agreements or other relevant agreements as are required for the investment of Collateral. The Lender agrees to be bound to the terms of any such agreement. FFitt A 0kld in qustody, and/or enter into any required agreement with a third party custodian that will oM m n and all Loaned Securities and Collateral delivered bythe Borrowers in respect of Y CI p t R b �c o the terms hereof, Collateral held by the Agent shall be segregated on the Agent's Et WORTH, Th ; 1 books and records as being maintained solely for the benefit of the Lender. To the extent Citibank, N.A. does not act as custodian for the Designated Accounts, the parties agree to the additional custody terms outlined in Exhibit B. e. If requested by the Lender, to invest on the Lender s behalf all cash Collateral delivered by Borrowers in respect of Loans The Lender hereby authorizes and instructs the Agent to invest cash Collateral pursuant to the parameters outlined on Schedule 111 to this Agency Agreement. The Agent's obligation with respect to the investments of cash Collateral shall be to make initial investments of cash Collateral within the parameters of Schedule 111 or as otherwise instructed by Lender. f. To perform daily the "mark -to -market" function described in the Lending Agreements as the Lender's agent and to request and return Collateral as contemplated in the Lending Agreements. The Lender acknowledges that the Agent will calculate the value of Loaned Securities and Collateral by reference to information provided by recognized pricing services, and shall have no liability for any errors or omissions in such information provided by such sources. g. To collect or arrange for the collection of any interest, dividends or other distributions or other payments of any kind on Loaned Securities (including but not limited to manufactured dividends, if any, and other distributions due to the Lender in respect of the Loan) and pay the same to the Lender. h. To: (i) terminate or modify any Loan at any time, (ii) terminate its responsibility and obligations as the Agent as to any loan, upon notice to the Lender at any time, and (iii) review and delete any Borrowers and/or investment counterparties at any time. 3. Representations and Warranties. a: The Lender and the Agent each hereby represent and warrant' that, throughout the term of 4this Agency Agreement, and for as long thereafter as a Loan is outstanding (i) Each party is authorized, under the terms of its organizational documents (including, without limitation, its certificate of incorporation, memorandum and articles of association and bylaws) the terms of any agreements with any third party, and the laws, rules and regulations that govern it, to enter into this Agency Agreement and be bound thereby to enter into the Loans, and to invest cash received as Collateral, in the case of the Lender as principal and in the case of the Agent as agent; and (ii) The person executing this Agency Agreement on its behalf has been, and all Authorized Persons acting on behalf of such party will have been, duly and properly authorized to do so. b. Lender represents and warrants that, throughout the term of this Agency Agreement, and as long thereafter as a Loan is outstanding: (i) the Securities in the Designated Accounts are, and shall be at the time Loans are made, free and clear of all liens and encumbrances except as may be set forth in a custody agreement with Citibank, N.A., and the Lender has full right, title and interest in and to and has not transferred, assigned or encumbered any interest or rights with respect to the Securities, this Agency Agreement, the Lending Agreements or transactions contemplated hereby or thereby; (ii) the Lender is not relying on the Agent to advise it on the suitability for the Lender of entering into any of the Lending Agreements nor the credit worthiness of any particular Borrower; (iii) the Lender is an 'accredited investor" as that term is defined in Regulation D under the Securities Act of 1933, as amended; (iv) the Lender is a ' qualified purchaser" for purposes of Section 3(c)(7) of the Investment Company Act of 1940, as amended; (v) the Lender is a qualified client ' as defined in Rule 205-3 under the Investment Advisers Act of 1940, as amended; and (vi) the Lender is a "qualified institutional buyer", as that term is defined by Rule 144A promulgated under the Securities Act of 1933. c. Both parties agree that the representations and warranties contained in this Section 3 shall be ongoing in nature, and shall continue throughout the term of this Agency Agreement If, during the term of this Agency Agreement, either party has reason to believe that any representation or warranty made hereunder is or soon will not be true and correct, then that party is obliged to notify the other party thereof as soon as reasonably practicable. 2 4. Indemnification. a. Subject to the limitations contained in Section 5 of this Agency Agreement, the Agent agrees to indemnify and hold harmless the Lender from and against damages, losses, costs and fees incurred by the Lender that result from the Agent s negligence or willful misconduct in performing its duties hereunder. b. Except for Loans in which Citigroup Global Markets Inc (referred to in this Section 4 as "Bank Affiliate") is the Borrower if there occurs an event of default by the Borrower under a Lending Agreement, which in the sole discretion of the Agent is not a result of an error or omission of an administrative or operational nature and which event terminates a Loan, the Agent shall liquidate the Collateral for its use in connection with this indemnification and either: (i) replace the Loaned Securities or purchase "Equivalent Securities" as that term is defined in the relevant Lending Agreement or (ii) pay an amount that is equal to the value of the Loaned Securities at the time at which the Loaned Securities were due to have been returned by the Borrower, or, if at such time a value is not determinable, the latest prior time at which a value is determinable. The parties acknowledge that with respect to Loans to Bank Affiliate, the Lender shall be separately provided a guarantee by Citigroup Inc. 5. Limitation Of Liability. In addition to any other limits set forth herein: a. Agent's liability under section 4.a of this Agency Agreement, whether to lender or any creditor of lender shall be limited to an amount equal to the market value of the securities that are the subject of the loan, investment or transaction to which the damage relates calculated at the time of the alleged act or omission giving rise to the indemnification b. Under no circumstances shall either party be liable for special, consequential or indirect damages, lost profits or loss of business. Agent shall incur no liability as a result of (i) acts or omissions of any depositoriesany third party agents of Agent (including, without limitation, pricing agencies) or any third party custodian, or (iii) any loss arising out of any suspension of the agent's duties and obligations hereunder as a result of any law, regulation, decree, order or governmental act that prevents or limits the performance of such duties and obligations (including the suspension of tradmg), except insofar as that decree, order or governmental act is imposed as a sanction against agent due to an act or omission of the Agent in violation of applicable law For the avoidance of doubt, and only to the extent permitted by law, the Lender agrees to indemnify the Agent and hold the Agent harmless from all Losses incurred by the Agent as a result of a third party custodian failing to comply with the instructions given to it under Clause 9(c). c. Except to the extent the Agent is negligent or acts with willful misconduct, the Agent shall not be liable: (i) for actions taken or omitted to be taken by the Agent pursuant to the terms of this Agency Agreement or the Lending Agreements• or (ii) as a consequence of carrying out an instruction of the Lender, including without limitation instructions transmitted orally, by telephone, telex facsimile transmission or any other means agreed to between the Lender and the Agent. 6. Lien/Set -Off As security for any liability of the Lender to the Agent, the Lender hereby (a) pledges and assigns to and grants to the Agent a continuing security interest in and a lien on, the Collateral and the proceeds thereof and the Agent shall have, with respect thereto all of the rights and remedies of a secured party under applicable law and (b) grants to the Agent a right of set-off against any assets in any custody account that the Lender may have with the Agent. 7. Subrogation. If the Agent makes any transfer or payment as a result of a failure by a Borrower to return any Loaned Securities, the Lender agrees that the Agent is and will be subrogated to all the Lender's rights with respect to such failure in and to the Lending Agreements and the Collateral under such Lending Agreements and the Lender hereby assigns to the Agent all such rights. 3 8. Duties of the Lender; Fees. a. Notwithstanding any other provision in this Agency Agreement to the contrary, the Lender acknowledges and agrees that the investment of cash received as Collateral is for the Lender' s account and risk The Lender agrees that to the extent any investment losses seduce the amount of cash below the amount required by the Loan and/or mark to market process, the Lender will, on the Agent s demand, pay to the Agent such amount (together with any applicable fees or charges) in cash, which the Agent will receive and use as, or reimburse for, Collateral If the Lender fails to make any payment due to the Agent, the Lender will be liable to the Agent for the amount of any such payment, together with interest on such amount from the date of the Agent's demand referred to above until payment of such liability. b. In consideration of the services provided hereunder the Lender agrees to pay to the Agent an amount equal to a fixed percentage of (i) the investment income (net of rebates) on cash Collateral delivered to the Agent on the Lender's behalf in respect of any Loans by the Borrowers, and (ii) fees paid in connection with transactions for which non -cash Collateral is provided by Borrowers. These amounts shall be set forth on Schedule IV of this Agency Agreement. The Lender authorizes and directs the Agent to withhold such fees on a monthly basis from the amounts payable to the Lender in respect of such investment and fee income or as otherwise agreed in writing. c. To the extent permitted by law, the Lender hereby assumes responsibility for any and all damages losses, costs and fees (excluding attorneys fees) incurred by the Agent that result from any grossly negligent act or material omission by the Lender pursuant to the terms of this Agency Agreement or the Lending Agreements 9. Instructions a. The Agent is entitled to rely and act upon any and all instructions (including, consents and notices) received by the Agent, communciated through any manual or electronic medium or system as agreed to by the parties ("Instructions") of any person identified by the Lender as an "Authorized Person' in connection with the transaction contemplated hereby until the Agent has received notice of any change from the Lender and has had a reasonable time to note and implement such change. The Agent is authorized to rely upon any Instructions received by any means, provided that the Agent and the Lender (or the Lender's authorized third party custodian) have agreed upon the means of transmission and the method of identification for the Instructions In particular: (i) The Agent is not responsible for errors or omissions made by the Lender or resulting from fraud or the duplication of any Instruction by, or on behalf of, the Lender, and the Agent may act on any Instruction by reference to an account number only, even if no account name is provided. (ii) The Agent may act on an Instruction if it reasonably believes it contains sufficient information. (iii) The Agent may decide not to act on an Instruction where it reasonably doubts its contents, completeness, authorization, or origination or where Instructions are given which conflict with each other but the Agent will promptly notify the Lender or its third party custodian of its decision. (iv) If the Agent acts on any Instruction sent manually (including by facsimile or telephone), then, if the Agent complies with the security procedures as referred to under Sub -Clause 4 9(a)(i) above, the Lender will be responsible for any loss the Agent may incur in connection with that Instruction. (v) Instructions are to be given in the English language. (vi) The Agent may refuse to execute Instructions if, in the Agent s opinion, they are contrary to any applicable law, rule or other regulatory requirement, whether arising from any governmental authority, self -regulatory organization or that of a relevant stock exchange, clearing house, settlement system or market. (vii) In some securities markets, securities deliveries and payments therefor may not be or are not customarily made simultaneously Accordingly, notwithstanding the relevant Instruction to deliver any part of the Collateral against payment or to pay for any part of the Collateral against delivery, the Agent may make or accept payment for or delivery of any part of the Collateral at such time and in such form and manner as is in accordance with relevant local law and practice or with the customs prevailing in the relevant market. b. The Lender and its Authorized Persons agree to provide written instructions related to the termination or modification of the terms of a Loan or otherwise as to the recall of Loaned Securities: (i) by electronic mail message; (ii) to the department or desk of the Agent that is separately identified to the Lender and its Authorized Persons; and (iii) in accordance with the deadlines and cutoff times set forth on Schedule V to this Agency Agreement, and to cause all of its investment managers and/or advisors with access to the Designated Accounts to so advise the Agent, or of any securities in the Designated Accounts it or they as applicable, shall sell or have sold. The Lender understands that the Agent shall have no liability as a result of the failure of the Lender and/or its investment managers/advisors to give this notice in accordance with the terms of this Section 9.b and the Lending Agreements. c. The Lender agrees to give irrevocable instructions to its custodian substantially in the form of those set out in Annex 1 to Exhibit A to act in accordance with any instructions given from time to time by the Agent (acting through duly authorised individuals as notified to the Lender's custodian in writing), including instructions relating to the settlement of transactions effected by the Agent on behalf of the Lender pursuant to any Lending Agreement and the transfer of Securities to or from the Designated Accounts at the direction of the Agent to enable the Agent to meet its obligations hereunder and the Lending Agreements; (b) to provide, at such times and in such form as the Agent may require, regular update information regarding the status of any action by the Lender's custodian required by an instruction given by the Lender to such custodian; and, (c) to provide the Agent with information about the Loaned Securities, provided that such irrevocable instructions may be revoked by the Lender upon the termination of this Agency Agreement. 10. Lender Information. The Agent may rely on the information relating to the Lender, including but not limited to tax -related information, in connection herewith particularly in agreeing and collecting any income due under a Lending Agreement. Request for such information by the Agent hereunder may be made from time to time during the term of this Agency Agreement. The Agent shall not incur any liability for any loss damages or costs arising directly or indirectly from the inaccuracy of information provided by the Lender or a failure by the Lender to supply information requested hereunder. 11. Advances. The Lender agrees to repay the Agent promptly, within thirty (30) days of written invoice for any reasonable advances of funds, not greater than $3 000, that the Agent may from time to time, in its sole discretion, make to or for the account of the Lender in connection with and to facilitate the transactions contemplated in this Agency Agreement and the Lending Agreements. In such event, the Lender shall be liable to the Agent for the amount of such advance or payment, together with interest on such amounts not re -paid within thirty (30) days of invoice, at a rate of one percent (1%) per annum or the maximum rate allowed by law. 5 12. Disclosure/Confidentiality. a. Subject to the terms of this Agency Agreement, the Agent and Lender will at all times respect and protect the confidentiality of this Agency Agreement and will not disclose to any other person any information acquired as a result of or pursuant to this Agency Agreement, unless required to do so by any applicable law, statute, regulation or by any court order or similar process enforceable in any relevant jurisdiction or if required to do so by any fiscal or regulatory body or self -regulatory organization (whether of a governmental nature or otherwise) in any relevant jurisdiction. b. The Lender also specifically authorizes the Agent to: (i) disclose information to Borrowers regarding the Lender as those Borrowers request or are required to obtain pursuant to applicable law, rule or regulation, or as deemed necessary in connection with the consummation or maintenance of any Loans; (ii) disclose to third parties information concerning the Securities in the Designated Accounts for the purpose of estimating the potential fees to be paid by Borrowers with respect thereto; and (iii) disclose to its agents and affiliates such information as required or necessary in connection with the consummation of Loans hereunder. c. The Lender agrees that no printed materials or other matter (in any language) that mention Citi, Citigroup Inc., Citibank, N.A , Citibank Europe plc, the rights, powers or duties of the Agent or the terms of this Agency Agreement shall be published or disclosed to any third party by the Lender or on the Lender's behalf unless: (i) Citibank, N A. shall first have given its specific written consent; or (ii) the Lender is legally required to do so pursuant to any applicable law, rule or regulation to which it is subject. 13. Non -Public Information, Bank Business and Roles. a Notwithstanding anything else contained in this Agency Agreement and any other agreement between the Lender and Citibank, N.A. and its affiliates (collectively, "Citi"): (i) the, Lender acknowledges that Citibank, N.A. and its affiliates perform a variety of services for a variety of entities, including banking and financial services for Borrowers, and advisor to issuers of the Loaned Securities and Collateral investments of the Lender; (ii) the Lender shall not hold Citibank, N A. or its affiliates liable for its or their failure to make use of, in its role as the Agent within the terms of this Agency Agreement non-public information it obtains in the course of doing so, the use of which may be prohibited by the legal and regulatory environment and by internal Citi policies, whether or not the use of such mformation in a specific instance might constitute a breach of any such applicable laws, regulations or polices; (iii) the Lender acknowledges that in its role as custodian and processing agent, separately from the services as Agent hereunder, Citibank, N.A. and its affiliates may receive compensation from the Lender in addition to the fees received pursuant to this Agency Agreement, and (iv) the Agent has entered, and may enter, into agreements similar to this Agency Agreement with others and the Agent or its affiliates may from time to time lend Securities to or through or enter into similar transactions with, any Borrower or, where relevant, act as discretionary manager for other clients and therefore agrees that: (A) the selection of a lender for any particular lending opportunity among all persons having entered into such agreements with the Agent shall be at the Agent's sole discretion; and (B) the Agent shall have no duty to inform the Lender of any lending of similar opportunity presented to the Agent or its affiliates or to refrain from taking advantage of 6 any such opportunity but may avail itself of any such opportunity as freely as if there were no relation of principal and agent between the Lender and the Agent. b. The Lender acknowledges and agrees that the obligations and duties of Citibank, N.A. under this Agency Agreement shall be performed only by Citibank, N.A. and its agents, and shall not be deemed obligations or duties of any other member of the Citi organization. 14. Notices. Except as otherwise specifically provided herein, all notices and other communications shall be in writing in the English language and shall be made either by facsimile or by prepaid first class mail (except that notice of termination, if mailed shall be sent by prepaid registered or certified mail) at the address listed below or at such other address as a party may advise the other parties hereto in writing from time to time. Notices provided to the parties hereto shall be effective upon receipt. If to the Agent: If to the Lender: Citibank N.A. 111 Wall Street, 15`h Floor New York, New York 10043 Fax: (212) 657-0515 Attn: Securities Finance — Compliance officer City of Fort Worth 1000 Throckmorton Street Fort Worth, Texas 76102 Attn: Treasury Department With Copy to the City Attorney At same address 15. Termination. a. Each party may terminate this Agency Agreement and the Agent's authorization as securities lending agent for the Lender at any time upon giving not less than fifteen (15) days prior written notice to the other. The parties hereby acknowledge and agiee that even after notice of termination of this Agency Agreement is given and effective, the Agent shall continue (unless specifically instructed to terminate or novate the Loans) to act as the Agent for the Lender as set forth herein with respect to any Loans outstanding at the time notice of termination is given until such Loans terminate. b. Notwithstanding anything else contained herein, the following terms shall survive the termination of this Agency Agreement: 4, 5, 6, 7, 8, 11 and 12. 16. Miscellaneous. a. No Advice, No Duty to Monitor. The Lender acknowledges and agrees that the Agent does not owe to, nor is it obligated to perform on behalf of, the Lender any investment advisory duties or responsibilities, nor shall the Agent have any duty to monitor investments of cash received as Collateral after the time of initial investment. b. No Third Party Beneficiaries This Agency Agreement is between the parties hereto and is not intended to confer any benefits on third parties, including without limitation any Borrower, any counterparty in a transaction with the Lender, or any third party service provider for the Lender or the Agent. c. Force Maieure Neither party shall be responsible to the other for any loss caused by a natural, regulatory or societal event due to any cause beyond its reasonable control, such as a natural disaster, 7 nationalization, currency restriction, act of war, act of terrorism, act of God, postal or other strike affecting the market infrastructure, unavailability of communications systems, sabotage or the failure, suspension or disruption of any relevant stock exchange, clearance system or market. d. Amendments. This Agency Agreement shall not be amended except by a written agreement between the parties and any purported amendment made in contravention of this section shall be null and void and of no effect whatsoever. e. Assignment. This Agency Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and permitted assigns. The Lender may not assign, transfer or charge all or any lights, benefits or obligations hereunder without the consent of Agent. Any purported assignment, transfer or charge made in contravention of this section shall be null and void and of no effect whatsoever. f Entire Agreement. This Agency Agreement and all current executed Schedules and Exhibits hereto shall constitute the entire agreement between the parties and, unless otherwise expressly agreed in writing, shall supersede all prior agreements and understandings written or oral relating thereto, between the parties. g. No Implied Waiver. The parties hereto agree that (i) the rights, powers, privileges and remedies stated in this Agency Agreement are cumulative and not exclusive of any rights powers, privileges and remedies provided by law, unless specifically waived, and (ii) any failure or delay in exercising any right, power, privilege or remedy will not be deemed to constitute a waiver thereof and a single or partial exercise of any right, power, privilege or remedy will not preclude any subsequent or further exercise of that or any other right, power, privilege or remedy. h. Further Assurances. The Lender agrees to provide such additional information and execute and deliver such further documentation as the Agent may reasonably request in connection with and in furtherance of the transactions authorized herein. i Partial Invalidity. In the event that any provision of this Agency Agreement, or the application thereof to any person or circumstances, shall be determined by a court of proper jurisdiction to be invalid or unenforceable to any extent, the remaining provisions of this Agency Agreement, and the application of such provisions to persons or circumstances other than those as to which it is held invalid or unenforceable, shall be unaffected thereby and such provisions shall be valid and enforced to the fullest extent permitted by law in such jurisdiction. j• Governing Law and Jurisdiction; Compliance with Laws. (i) This Agency Agreement shall be governed by and construed in accordance with the laws of the State of New York, except that all matters related to indemnification shall be governed by Texas law. (ii) If either the Lender or the Agent has a claim, dispute or other matter in question for breach of duty, obligations services rendered or any warranty that arises under this Agency Agreement, the parties shall first attempt to resolve the matter through this dispute resolution process. The disputing party shall notify the other party in writing as soon as practicable after discovering the claim, dispute, or breach. The notice shall state the nature of the dispute and list the party's specific reasons for such dispute. Within ten (10) business days of receipt of the notice, both parties shall commence the resolution process and make a good faith effort either through email, mail phone conference, in person meetings, or other reasonable means to resolve any claim, dispute breach or other matter in question that may arise out of, or in connection with this Agency Agreement If the parties fail to resolve the dispute within thirty (30) days of the date of receipt of the notice of the dispute, then the parties shall submit the matter to non- 8 binding mediation in Tarrant County, Texas, in accordance with the Industry Arbitration Rules of the American Arbitration Association or other applicable rules governing mediation then in effect. The mediator shall be agreed to by the parties Each party shall be liable for its own expenses, including attorney's fees; however, the parties shall share equally in the costs of the mediation. If the parties cannot resolve the dispute through mediation, then either party shall have the right to exercise any and all remedies available under law regarding the dispute, including trial by jury. Notwithstanding the fact that the parties may be attempting to resolve a dispute in accordance with this informal dispute resolution process, the parties agree to continue without delay all of their respective duties and obligations under this Agency Agreement not affected by the dispute. Either party may, before or during the exercise of the informal dispute resolution process set forth herein, apply to a court having jurisdiction for a temporary restraining order or preliminary injunction where such relief is necessary to protect its interests. (iii) The Lender acknowledgesand agrees that the Agent's performance of this Agency Agreement is subject to the relevant local laws, regulations, decrees, orders and government acts and the rules, operating procedures and practices of any relevant stock exchanges, clearance systems or market where or through Loans are to be carried out and to which the Agent may be subject and as exist in the country in which any Securities or Collateral are held. k. Counterparts. This Agency Agreement may be executed in several counterparts, each of which shall be an original, but all of which together shall constitute one and the same agreement. • IN WITNESS WHEREOF, the parties hereto have caused this Securities Lending Agency Agreement to be executed as of the date set forth above. CITIBANK, N.A., Agent By: Name: Title: ATTEST: /u3 Winter, Managing Director US Faced Income & Casty Reinvestment Trading GTS/Securities Finance 111 Wall Street. NY. NY , vi:05 Office: 212-657-0370 Fax: 2 -657 0515 Email: barrywinter©ctti.com • By: Name: Title: • OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX t By: CITY OF FORT WORTH, Lender By: Name: Karen L MontgomeryT 3 Title: Assistant City Manager ATTEST: ‘ni\ Marty Hendrix City Secretary l .o'O��+�ositk,nt ft�T0io 004t, A94 00 APPROVED TO FORM AND E tE $T AA sos B y • — --- -- -- tx00 Maleshia B. armer 9 Assistant City Attorney (VI c: Q. P I a 1 te Atientrals1i47-ou 471 1-EXA'tc's kilatit.tetanswew Schedule I to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender SECURITIES LENDING BORROWERS LENDER: CITY OF FORT WORTH US Borrower List ABN AMRO Securities (USA) LLC (f/k/a MeesPierson Securities LLC) Barclays Capital Inc. BMO Capital Markets Corp. (f/k/a Harris Nesbitt Corp. BMO Nesbitt Burns Corp. Nesbitt Burns Securities Inc.) BNP Paribas Securities Corp Cantor Fitzgerald & Co. CIBC World Markets Corp. (f/k/a CIBC Oppenheimer Corp.) Citigroup Global Markets Inc. (f/k/a Salomon Smith Barney Inc). — Affiliate of Citigroup Inc. Commerz Markets LLC (f/k/a Dresdner Kleinwort Securities LLC, Dresdner Kleinwort Wasserstein LLC, Dresdner Kleinwort Benson North America LLC) Credit Agncole Securities (USA) Inc. (f/k/a Calyon Securities (USA), Inc. Credit Suisse Securities (USA) LLC (f/k/a Credit Suisse First Boston LLC, Credit Suisse First Boston Corporation) Daiwa Capital Markets America Inc. (f/k/a Daiwa Securities America, Inc.) Deutsche Bank Securities Inc. (f/k/a Deutsche Banc Alex Brown Inc.) Cbldman, Sachs & Co. Guggenheim Securities LLC (f/k/a Guggenheim Liquidity Services, LLC, LBBW Securities, LLC) HSBC Securities (USA) Inc. ING Financial Markets LLC (f/k/a ING Banngs Corp.) J.P. Morgan Securities LLC (f/k/a J P. Morgan Securities, Inc., Merged with Chase Securities Inc.) Jefferies & Co., Inc. Merrill Lynch, Pierce, Fenner and Smith, Inc. (Part of Bank of America Corporation, merged with Banc of America Securities LLC) MF Global Inc. Mitsubishi UFJ Securities (USA) Inc. Mizuho Securities USA Inc. (f/k/a Fuji Securities, Inc.) Morgan Stanley & Co. Incorporated Newedge USA, LLC (f/k/a Fimat USA Inc.) Nomura Securities International, Inc. Pershing LLC RBC Capital Markets, LLC (f/k/a RBC Capital Markets Corporation, RBC Dominion Securities Corp.) RBS Securities Inc. (f/k/a Greenwich Capital Markets, Inc. and ABN AMRO Inc.) Scotia Capital (USA) Inc. SG Amencas Securities, LLC (MSLA assigned by SG Cowen Securities Corp). Societe Generale, New York Branch South Street Securities LLC UBS Securities LLC (f/k/a UBS Warburg LLC, Warburg Dillon Read LLC In connection with loans of Securities and reverse repurchase transactions (if previously approved as investment vehicle for Securities lending cash collateral) within the terms of the securities lending program, we authorize the use of the following entities as third party custodians of (a) collateral for securities lend under the securities lending program, and (b) Securities purchased under repurchase transactions (if previously approved) and cash collateral remitted for such purchases: The Bank of New York and JP Morgan I Chase Bank. We further authorize Citibank, N.A., as our agent to enter into the necessary agreements to effectuate the foregoing. CITY OF FORT WORTH, Lender Approved by: Name: Title: Karen L . ` Montgome r 3,4 Assistant City Manager �l Schedule II to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender Collateralization Parameters The Agent shall accept only the following types of Collateral in an amount equal to or greater than the designated maintenance requirement (for the specific type of Loan) for any Loans entered into pursuant to authority in the Securities Lending Agency Agreement: A. Collateral US Dollar Cash U.S. Government and Agency Debt - Any security issued by or fully guaranteed as to payment of principal and interest by the full faith and credit of the U.S. Government, U.S. Government Agency or U.S. Government Sponsored Enterprise, including securities issued under the Transaction Account Guarantee Program and guaranteed by the FDIC. B. Maintenance Requirements (1) Loans of US Government or Agency Securities: 102% plus accrued interest. CITIBANK, N.A. as Agent By: Na Title: Dated as of: tiany wow. Managing uireCtar US Rad Income & Cash Reinvestment Trading GM/Securities Finance 111 Waif Street NY, NY 10005 Office: 212-657-0370 Fax 212-657 0515 Email: barry.winter @citi.com April 1, 2011 CITY OF FORT WORTH as Lender By: Name: Karen L. Monmery Title: Assistant City Manager I Schedule III to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender INVESTMENT GUIDELINES FOR SECURITIES LENDING CASH COLLATERAL LENDER: CITY OF FORT WORTH Permitted Investments: 1. U.S. Government and Agency Debt - Any security issued by or fully guaranteed as to payment of principal and interest by the full faith and credit of the U.S. Government, U.S. Government Agency or U.S. Government Sponsored Enterprise including securities issued under the Transaction Account Guarantee Program and guaranteed by the FDIC. 2. Registered Money Market Mutual Funds Any of the following money market mutual funds • Federated Prime Obligations • Fidelity Prime Money Market • Western Asset Institutional Cash Reserves The Lender acknowledges that the above -listed funds, and any money market funds to be included from time to time as permitted investments shall, at the time of the initial investment: • represent to adhere to and maintain compliance with S E C Section 270.2a-7 of Title 17 of the Code of Federal Regulation • have a managed fund credit rating of AAA or its equivalent 3. Repurchase Agreements. Repurchase transactions which at the time of the initial investment meet the following criteria: • Executed with counterparties that are recognized as a "Primary Dealer" in Government Securities as per the NY Federal Reserve Bank. • Executed with counterparties, who have, or its parent have, a long-term senior unsecured debt rating of "A' or better by one or more Nationally Recognized Statistical Rating Organizations. • Providing that the two previously stated conditions are met, Citigroup Global Markets Inc. shall be considered as an eligible counterparty. • Executed with underlying collateral that is a security meeting the criteria described in item 1 above. In addition, collateral for repurchase transactions may be municipal securities which 1 are rated at least investment grade by one or more Nationally Recognized Statistical Rating Organizations. Collateral for all repurchase transactions must be held by Citibank or by a third party custodian under a tri-party agreement Collateral for all repurchase transactions must be marked to market daily and maintained at the following minimum margin levels. • U.S. Government debt, U.S. Government Guaranteed debt, U.S. Agencies and Sponsored Enterprises 102% • Municipal Securities 105% Investment Restrictions: No investments with a maturity longer than 95 days from settlement date are permitted 2 Schedule IV to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender FEES AND REVENUE PERCENTAGE PAYMENT BY THE LENDER Pursuant to section 8.b of the Agency Agreement, the Lender agrees to pay to the Agent 10% of (i) the investment income (net of rebates) on cash Collateral delivered to the Agent on the Lender's behalf in respect of any Loans by the Borrowers and (ii) fees paid by a Borrower with respect to a Loan for which non -cash Collateral is provided. 3 Schedule V to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender CUTOFF TIMES FOR SALES NOTIFICATION Daily deadlines for the Lender's requests to terminate a loan under Section 9.b. of the Agency Agreement are as follows: o For FRB Eligible Securities — Settlement Date by 9AM EST o For U.S. Equities and U.S. Corporate bonds via DTC — Trade Date 4 Schedule VI to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender APPROVED LENDING AGREEMENTS TYPE OF SECURITIES APPLICABLE LENDING AGREEMENT* US Securities Master Securities Lending Agreement (1984) Master Securities Loan Agreement (2000 version) * Note: Agent shall provide Lender with a copy of the applicable Lending Agreement upon request. WOK Managing Director Title US xS Income & Gash Reinvestment Trading GTSISecurities Finance 111Wal Street, NY, NY 10005 212 657 0370 Fax: 212-657 0515 Dated as of: Ems' iiterz1dticpm Custodian Exhibit A to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender LIST OF DESIGNATED ACCOUNTS Account Name Account Number To the extent the custodian listed above is not Citibank, N.A., the Lender agrees to give irrevocable instructions to the applicable custodian substantially in the form of those set out in Annex 1 to this Exhibit A. CITIBANK, NA., Agent CITY OF FORT WORTH, Lender By. 4)\\Jk're--- By.i , / Nam Name: Karen L. Ma - tgome Title: Assistant City Manager 2 Annex 1 to Exhibit A to Securities Lending Agency Agreement FORM OF LETTER TO BE SENT BY LENDER TO THE CUSTODIAN Ladies and Gentlemen: We have entered into a Global Securities Lending Agency Agreement (the "Agreement") with Citibank, N.A. ("Citibank"). Under the Agreement Citibank, N.A. is authorized to enter into securities lending agreements with borrowers (the "Borrowers") on our behalf and at our risk and to exercise all our rights, powers and discretion in relation to such loans and lending agreements In accordance with the terms of the Agreement and the Custody Agreement dated • (the 'Custody Agreement") whereby we appointed you (the "Custodian") to act as our custodian, we should be grateful if you would act in accordance with the following instructions. Expressions used in this letter shall have the following meanings: "Corporate Actions" means calls for redemption grants or expirations of conversion or subscription rights, notices of payment of dividends or other distributions, mergers, offers, consolidations, reorganizations and capitalizations and any other corporate actions or administrative or supervisory matters affecting the Securities. "Loan" means any securities lending transaction entered into by Citibank on our behalf. "Securities" means those securities which are held with the Custodian in its capacity as custodian, or by a sub -custodian appointed by the Custodian in its capacity as custodian, in all cases pursuant to the Custody Agreement; the Services set out herein will be performed by the Custodian only in respect of those Securities held in such accounts which have been marked by the Custodian as "available' and which have been notified as such to Citibank. We hereby direct the Custodian to provide the following services to Citibank: 1. The Custodian shall notify Citibank, acting through any duly authorized individual as notified to the Custodian in writing from time to time by Citibank (an "Authorized Person' )), of a list of Securities available for Loan. 2. Upon receipt of an instruction from an Authorized Person, the Custodian shall deliver out Securities and record those Securities within the Custodian's custody accounting system as being on Loan. 3 Annex 1 to Exhibit A to Securities Lending Agency Agreement 3. Upon receipt of an instruction from an Authorized Person or SWIFT instructions from Citibank, the Custodian shall process the receipt of Securities returned from Loan by a Borrower. 4. In relation to Corporate Actions, the Custodian shall: 4.1 notify Citibank of any Corporate Action which the Custodian has actually received, affecting Securities transferred under a Loan; 4.2 act upon instructions received from an Authorized Person in connection with Corporate Actions affecting Securities transferred under a Loan; and 4.3 receive benefits or distributions on our behalf arising out of Corporate Actions affecting Securities transferred under a Loan. 5. In the event that a "buy -in" is exercised against us, the Custodian will give written notice to Citibank before [time] on the trade date for such "buy -in" All communications to Citibank shall be directed to: Citibank, N.A. [insert relevant address and details] forthe attention of: Securities Lending or to such other address, or for the attention of such other person as Citibank shall from time to time notify .to the Custodian. Yours faithfully [NAME OF CLIENT] 4 Exhibit B to the Global Securities Lending Agency Agreement, Between CITIBANK, N.A., As the Agent and the Lender GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) GLOBAL CUSTODIAL SERVICES AGREEMENT CITY OF FORT WORTH GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) TABLE OF CONTENTS 1. DEFINITIONS AND INTERPRETATION 1 2. ESTABLISHMENT OF ACCOUNTS 1 3. CUSTODY ACCOUNT PROCEDURES 4. CASH ACCOUNT PROCEDURES 5. INSTRUCTIONS 3 6. PERFORMANCE BY THE CUSTODIAN 3 7. TAX STATUS/WITHHOLDING TAXES 4 8. USE OF THIRD PARTIES 4 9. REPRESENTATIONS 5 10. SCOPE OF RESPONSIBILITY 6 11 SUBROGATION 7 12. INDEMNITY 7 13. LIEN AND SET OFF 7 14. FEES AND EXPENSES 7 15. CITIGROUP ORGANISATION INVOLVEMENT 8 16. RECORDS AND ACCESS 8 17. INFORMATION 8 18. ADVERTISING 8 19. TERMINATION. 8 20. GOVERNING LAW AND JURISDICTION 9 21. MISCELLANEOUS 9 22. SIGNATURES 10 Schedules: • Fee Schedule 2 2 GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) THIS GLOBAL CUSTODIAL SERVICES AGREEMENT is made on April 1, 2011, by and between The City of Fort Worth organized under the laws of the State of Texas, (the "Client ") and Citibank, N.A. acting through its offices located in the State of Texas (the "Custodian"). 1. DEFINITIONS AND INTERPRETATION (A) Definitions. "Authorized Person" means the Client or any person (including any individual or entity) authorized by the Client to act on its behalf in the performance of any act, discretion or duty under this Agreement (including, for the avoidance of doubt, any officer or employee of such person) in a notice reasonably acceptable to the Custodian. "Cash" means all cash or cash equivalents in any currency received and held on the terms of this Agreement. "Citigroup Organization" means Citigroup, Inc. and any company or other entity of which Citigroup, Inc. is directly or indirectly a shareholder or owner. For purposes of this Agreement, each branch of Citibank, N.A. shall be a separate member of the Citigroup Organization. "Clearance System" means any clearing agency, settlement system or depository (including any entity that acts as a system for the central handling of Securities in the country where it is incorporated or organized or that acts as a transnational system for the central handling of Securities) used in connection with transactions relating to Securities and any nominee of the foregoing. "Fee Schedule" means the schedule referred to in Section 14, as annexed hereto. "Instructions" means any and all instructions (including approvals, consents and notices) received by the Custodian from, or reasonably believed by the Custodian to be from, any Authorized Person, including any instructions communicated through any manual or electronic medium or system agreed between the Client and the Custodian. "Securities" means any financial asset (other than Cash) from time to time held for the Client on the terms of this Agreement. "Taxes" means all taxes, levies, imposts, charges, assessments, deductions, withholdings and related liabihties, including additions to tax, penalties and interest imposed on or in respect of (i) Securities or Cash, (ii) the transactions effected under this Agreement or (iii) the Client provided that "Taxes" does not include income or franchise taxes imposed on or measured by the net income of the Custodian or its agents. (B) Interpretation. References in this Agreement to schedules shall be deemed to be references to schedules, the terms of which shall be incorporated into and form part of this Agreement. GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) 2. ESTABLISHMENT OF ACCOUNTS (A) Accounts. The Client authorizes the Custodian to establish on its books, pursuant to the terms of this Agreement, (i) a custody account or accounts (the `Custody Account') and (ii) a cash account or accounts (the "Cash Account"). The Custody Account will be a custody account for the receipt, safekeeping and maintenance of Securities, and the Cash Account will be a current account for Cash (B) Acceptance of Securities and Cash. The Custodian will determine in its reasonable discretion whether to accept (i) for custody in the Custody Account, Securities of any kind and (ii) for deposit in the Cash Account, Cash in any currency. (C) Designation of Accounts. (i) The Custody Account will be in the name of the Client or such other name as the Client may reasonably designate and will indicate that Securities do not belong to the Custodian and are segregated from the Custodian s assets. (ii) The Cash Account will be in the name of the Client or such other name as the Client may reasonably designate and will be held by the Custodian as banker. (D) Segregation. (i) To the extent reasonably practicable, the Custodian will hold Securities with a subcustodian only in an account which holds exclusively assets held by the Custodian for its customers. The Custodian will direct each subcustodian to identify on its books that Securities are held for the account of the Custodian as custodian for its customers. The Custodian will direct each subcustodian, to the extent practicable, to hold Securities in a Clearance System only in an account of the subcustodian which holds exclusively assets held by the subcustodian for its customers. (ii) Any Securities deposited by the Custodian with a subcustodian will be subject only to the instructions of the Custodian, and any Securities held in a Clearance System for the account of a subcustodian will be subject only to the instructions of the subcustodian. (iii) The Custodian shall require the subcustodian to agree that Securities will not be subject to any right, charge, security interest, lien or claim of any kind in favour of the subcustodian. 3. CUSTODY ACCOUNT PROCEDURES (A) Credits to the Custody Account. The Custodian is not obligated to credit Securities to the Custody Account before receipt of such Securities by final settlement. (B) Debits to the Custody Account. If the Custodian has received Instructions that would result in the delivery of Securities exceeding credits to the Custody Account for that Security, the GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) Custodian may reject the Instructions or may decide which deliveries it will make (in whole or in part and in the order it selects). (C) Denomination of Securities. The Client shall bear the risk and expense associated with investing in Securities denominated in any currency. 4. CASH ACCOUNT PROCEDURES (A) Credits and Debits to the Cash Account. The Custodian is not obliged to make a credit or debit to the Cash Account before receipt by the Custodian of a corresponding and final payment in cleared funds If the Custodian makes a credit or debit before such receipt the Custodian may at any time reverse all or part of the credit or debit (including any interest thereon), make an appropriate entry to the Cash Account, and if it reasonably so decides require repayment of any amount corresponding to any debit. (B) . Debit Balances in the Cash Account. The Custodian is not obliged to make any debit to the Cash Account which might result in or increase a debit balance The Custodian may make any debit to the Cash Account even if this results in (or increases) a debit balance If the total amount of debits to the Cash Account at any time would otherwise result in a debit balance or exceed the immediately available funds credited to the Cash Account, the Custodian may decide which debits it will make (in whole or in part and in the order it selects). (C) Payments. The Custodian may at any time cancel any extension of credit. The Client will transfer to the Custodian on closure of the Cash Account and 'otherwise on demand from the Custodian sufficient immediately available funds to cover any debit balance on the Cash Account or any other extension of credit and any interest, fees and other amounts owed. (D) Foreign Currency Risks. The Client shall bear the risk and expense associated with Cash denominated in any currency. 5. INSTRUCTIONS The Custodian is entitled to rely and act upon Instructions of any Authorized Person until the Custodian has received notice of any change from the Client and has had a reasonable time, which shall not in any event be longer than ten (10) business days to note and implement such change The Custodian is authorized to rely upon any Instructions received by any means, provided that the Custodian and the Client have agreed upon the means of transmission and the method of identification for the Instructions. In particular: (i) The Client and the Custodian will agree upon security procedures designed to verify the origination of Instructions. (ii) The Custodian is not responsible for errors or omissions made by the Client or resulting from fraud or the duplication of any Instruction by the Client and the Custodian may act GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) on any Instruction by reference to an account number only, even if any account name is provided. (iii) The Custodian may act on an Instruction if it reasonably believes it contains sufficient information. (iv) The Custodian may decide not to act on an Instruction where it reasonably doubts its contents, authorization, origination or compliance with any security procedures and will promptly notify the Client of its decision. (v) If the Custodian acts on any Instruction sent manually (including facsimile or telephone), then, if the Custodian complies with the security procedures agreed with the Client if any, the Custodian will not be responsible for any loss which may result in connection with that Instruction. (vi) Instructions are to be given in the English language. (vii) The Custodian is obligated to act on Instructions only within applicable cut-off times on banking days when the Custodian and the applicable financial markets are open for business. (viii) In some securities markets, securities deliveries and payments therefor may not be or are not customarily made simultaneously. Accordingly, notwithstanding the Client's Instruction to deliver Securities against payment or to pay for Securities against delivery, the Custodian may make or accept payment for or delivery of Securities at such time and in such form and manner as is in accordance with relevant Local law and practice or with the customs prevailing in the relevant market. 6. PERFORMANCE BY THE CUSTODIAN (A) Custodial Duties Requiring Instructions. The Custodian shall carry out the following actions only upon receipt of and in accordance with specific Instructions: (i) make payment for and/or receive any Securities or deliver or dispose of any Securities except as otherwise specifically provided for in this Agreement; (ii) deal with rights, conversions, options, warrants and other similar interests or any other discretionary right in connection with Securities; and (iii) carry out any action affecting Securities or the Custody Account or Cash or the Cash Account other than those specified in Section 6(B) below, but in each instance subject to the agreement of the Custodian. (B) Non -Discretionary Custodial Duties. Absent a contrary Instruction, the Custodian shall carry out the following without further Instructions: GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) (i) in the Client's name or on its behalf, sign any affidavits, certificates of ownership and other certificates and documents relating to Securities which may be required (i) to obtain any Securities or Cash or (ii) by any tax or regulatory authority; (ii) collect, receive, and/or credit the Custody Account or Cash Account, as appropriate, with all income, payments and distributions in respect of Securities and any capital arising out of or in connection with Securities (including all Securities received by the Custodian as a result of a stock dividend, bonus issue, share sub -division or reorganisation capitalisation of reserves or otherwise) and take any action necessary and proper in connection therewith; (iii) exchange interim or temporary receipts for definitive certificates, and old or overstamped certificates for new certificates; (iv) notify the Client of notices, circulars, reports and announcements which the Custodian has received, in the course of acting in the capacity of custodian, concerning Securities held on the Client's behalf that require discretionary action; (v) make any payment by debiting the Cash Account or any other designated account of the Client with the Custodian as required to effect any Instruction; and (vi) attend to all non -discretionary matters in connection with anything provided in this Section 6(B) or any Instruction. 7. TAX STATUS/WITHHOLDING TAXES (A) Information. The Client will provide the Custodian, from time to time and in a timely manner, with information and proof (copies or originals) as the Custodian reasonably requests, as to the Client's and/or the underlying beneficial owner's tax status or residence. Information and proof may include, as appropriate, executing certificates, making representations and warranties, or providing other information or documents in respect of Securities, as the Custodian deems necessary or proper to fulfill obligations under applicable law. (B) Payment. If any Taxes become payable with respect to any payment to be made to the Client, such Taxes will be payable by the Client and the Custodian may withhold the Taxes from such payment. The Custodian may withhold any Cash held or received with respect to the Cash Account and apply such Cash in satisfaction of such Taxes If any Taxes become payable with respect to any prior payment made to the Client by the Custodian, the Custodian may withhold any Cash in satisfaction of such prior Taxes. The Client shall remain liable for any deficiency. (C) Tax Relief. In the event the Client requests that the Custodian provide tax relief services and the Custodian agrees to provide such services, the Custodian shall apply for appropriate tax relief (either by way of reduced tax rates at the time of an income payment or retrospective tax reclaims in certain markets as agreed from time to time); provided the Client provides to the Custodian such documentation and infointation as to it or its underlying beneficial owner clients as is necessary to secure such tax relief However, in no event shall the Custodian be responsible, or liable, for any Taxes resulting from the GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) inability to secure tax relief, or for the failure of any Client or beneficial owner to obtain the benefit of credits, on the basis of foreign taxes withheld, against any income tax liability. 8. USE OF THIRD PARTIES (A) General Authority. (i) The Custodian is hereby authorized to appoint subcustodians and administrative support providers as its delegates and to use or participate in market infrastructures and Clearance Systems to perform any of the duties of the Custodian under this Agreement. (ii) Subcustodians are those persons utilized by the Custodian for the safe -keeping, clearance and settlement of Securities. (iii) Administrative support providers are those persons utilized by the Custodian to perform ancillary services of a purely administrative nature such as couriers, messengers or other commercial transport systems. (iv) Market infrastructures are public utilities, external telecommunications facilities and other common carriers of electronic and other messages and external postal services. Market infrastructures are not delegates of the Custodian. (v) Securities deposited with Clearance Systems hereunder will be subject to the laws, rules, statements of principle and practices of such Clearance Systems. Clearance Systems are not delegates of the Custodian. (B) Responsibility. (i) The Custodian shall act in good faith and use reasonable care in the selection and continued appointment of subcustodians and administrative support providers, but shall otherwise have no responsibility for performance by such persons of any of the duties delegated to them under this Agreement. (ii) The Custodian may deposit or procure the deposit of Securities with any Clearance System as required by law, regulation or best market practice. The Custodian has no responsibility for selection or appointment of, or for performance by, any Clearance System or market infrastructure. (iii) Notwithstanding the foregoing and pursuant to Section 10, the Custodian shall be responsible for the negligence, wilful misconduct or fraud of any branch or subsidiary of the Custodian that is a subcustodian or administrative support provider. (C) Shareholders Voting. The Custodian's only obligation in regard to any matter where the Client may exercise shareholder voting rights will be to provide shareholder voting services as specified in a separate proxy services letter between the Custodian and the Client. GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) 9. REPRESENTATIONS (A) General. The Client and the Custodian each represents at the date this Agreement is entered into and any custodial service is used or provided that: (i) It is duly organized and in good standing in every jurisdiction where it is required so to be; (ii) It has the power and authority to sign and to perform its obligations under this Agreement; (iii) This Agreement is duly authorized and signed and is its legal, valid and binding obligation; (iv) Any consent, authorization or instruction required in connection with its execution and performance of this Agreement has been provided by any relevant third party; (v) Any act required by any relevant governmental or other authority to be done in connection with its execution and performance of this Agreement has been or will be done (and will be renewed if necessary); and (vi) Its performance of this Agreement will not violate or breach any applicable law, regulation, contract or other requirement. (B) Client. The Client also represents at the date this Agreement is entered into and any custodial service is used or provided that: (i) - It has authority to deposit the Securities received in the Custody Account and the Cash in the Cash Account and there is no claim or encumbrance that adversely affects any delivery of Securities or payment of Cash made in accordance with this Agreement; (ii) Where it acts as an agent on behalf of any of its own customers, whether or not expressly identified to the Custodian from time to time, any such customers shall not be customers or indirect customers of the Custodian; and (iii) It has not relied on any oral or written representation made by the Custodian or any person on its behalf. 10. SCOPE OF RESPONSIBILITY (A) Standard of Care. The Custodian shall exercise the due care of a professional custodian for hire. (B) Limitations on Losses. The Custodian will not be responsible for any loss or damage suffered by the Client unless the loss or damage results from the Custodian's negligence, wilful misconduct or fraud or the negligence, wilful misconduct or fraud of its nominees or any branch or subsidiary; in the event of such negligence or wilful misconduct the liability of the Custodian in connection with the loss or damage will not exceed (i) the lesser of replacement of any Securities or the market value of the Securities to which such loss or damage relates at the time the Client reasonably should have been aware of such negligence or wilful misconduct and (ii) replacement of Cash, plus (iii) compensatory GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) interest up to that time at the rate applicable to the base currency of the Cash Account. Under no circumstances will the Custodian be liable to the Client for consequential loss or damage, even if advised of the possibility of such loss or damage. (C) Limitations on the Custodian's Responsibility. (i) ( General. The Custodian is responsible for the performance of only those duties as are expressly set forth herein, including the performance of any Instruction given in accordance with this Agreement. The Custodian shall have no implied duties or obligations. i) Sole Obligations of the Custodian. The Client understands and agrees that (i) the obligations and duties of the Custodian will be performed only by the Custodian and are not obligations or duties of any other member of the Citigroup Organization (including any branch or office of the Custodian) and (ii) the rights of the Client with respect to the Custodian extend only to such Custodian and, except as provided by law, do not extend to any other member of the Citigroup Organization. (iii) No Liability for Third Parties. Except as provided in Section 8 hereof, the Custodian is not responsible for the acts, omissions, defaults or insolvency of any third party including, but not limited to, any broker, counterparty or issuer of Securities. (iv) Performance Subject to Laws. The Client understands and agrees that the Custodian's performance of this Agreement is subject to the relevant local laws, regulations, decrees, orders and government acts, and the rules, operating procedures and practices of any relevant stock exchange, Clearance System or market where or through which Instructions are to be carried out and to which the Custodian is subject and as exist in the country in which any Securities or Cash are held. (v) Prevention of Performance. Neither party will be responsible for any failure to perform any of its obligations (nor will Custodian be responsible for any unavailability of funds credited to the Cash Account) if such performance is prevented, hindered or delayed by a Force Majeure Event, in such case its obligations will be suspended for so long as the Force Majeure Event continues. "Force Majeure Event" means any event due to any cause beyond the reasonable control of either party, such as restrictions on convertibility or transferability, requisitions, involuntary transfers, unavailability of communications system, sabotage, fire, flood, explosion, acts of God, civil commotion, strikes or industrial action of any kind, riots insurrection, war or acts of government. (vi) Client's Reporting Obligations. The Client shall be solely responsible for all filings, tax returns and reports on any transactions in respect of Securities or Cash or relating to Securities or Cash as may be required by any relevant authority, whether governmental or otherwise. (vii) Validity of Securities. The Custodian shall exercise reasonable care in receiving Securities but does not warrant or guarantee the form, authenticity, value or validity of any Security received by the Custodian If the Custodian becomes aware of any defect in title or forgery of any Security, the Custodian shall promptly notify the Client. GCSA 2000 NY - V.11.9.2002- (Stdl City of Fort Worth March 10, 2011) (viii) Capacity of Custodian. The Custodian is not acting under this Agreement as an investment manager, nor as an investment, legal or tax adviser to the Client, and the Custodian's duty is solely to act as a Custodian in accordance with the terms of this Agreement. (ix) Forwarded Information. The Custodian is not responsible for the form, accuracy or content of any notice, circular, report announcement or other material provided under Section 6(B)(iv) of this Agreement not prepared by the Custodian including the accuracy or completeness of any translation provided by the Custodian in regard to such forwarded communication. 11. SUBROGATION To the extent permissible by law or regulation and upon the Client's request, the Client shall be subrogated to the rights of the Custodian with respect to any claim for any loss, damage or claim suffered by the Client, in each case to the extent that the Custodian fails to pursue any such claim or the Client is not made whole in respect of such loss, damage or claim. Notwithstanding any other provision hereof, in no event is the Custodian obliged to bring suit in its own name or to allow suit to be brought in its name. 12. INDEMNITY (A) Indemnity to the Custodian. Intentionally deleted. (B) Client's Direct Liability. The disclosure by the Client to the Custodian that the Client has entered into this Agreement as the agent or representative of another person shall not relieve the Client of any of its obligations under this Agreement. 13. LIEN AND SET OFF (A) Lien. In addition to any other remedies available to the Custodian under applicable law, the Custodian shall have, and the Client hereby grants, a continuing general lien on all Securities until the satisfaction of liabilities arising under this Agreement of the Client to the Custodian in respect to any fees and expenses or credit exposures incurred in the performance of services under this Agreement. (B) Set Off. To the extent permitted by applicable law and in addition to any other remedies available to the Custodian under applicable law, the Custodian may, without prior notice to the Client, set off any payment obligation owed to it by the Client in connection with all liabilities arising under this Agreement against any payment obligation owed by it to the Client under this Agreement regardless of the place of payment or currency of either obligation (and for such purpose may make any currency conversion necessary). GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) 14. FEES AND EXPENSES The Client agrees to pay all fees, charges and obligations incurred from time to time for any services pursuant to this Agreement as determined in accordance with the terms of the Fee Schedule, which may be changed from time to time by the Custodian upon prior written notice to the Client, together with any other amounts payable to the Custodian under this Agreement. The Custodian may debit the Cash Account to pay any such fees, charges and obligations. 15. CITIGROUP ORGANIZATION INVOLVEMENT The Client agrees and understands that any member of the Citigroup Organization can engage as principal or otherwise in any transaction effected by the Client or by any person for its account and benefit, or by or on behalf of any counterparty or issuer. When instructed to effect any transactions (particularly foreign exchange transactions), the Custodian is entitled to effect any transaction by or with itself or any member of the Citigroup Organisation and to pay or keep any fee, commissions or compensation as specified in the Client's Instruction or, if no specification is provided, any charges, fees, commissions or similar payments generally in effect from time to time with regard to such or similar transactions. 16. RECORDS AND ACCESS (A) Examination of Statements. The Client shall examine each statement sent by the Custodian and notify the Custodian in writing within sixty (60) days of the date of such statement of any discrepancy between Instructions given by the Client and the position shown on the statement and of any other errors known to the Client. Absent such notification the Custodian' s liability for any loss or damage in regard to such discrepancy or errors shall not accrue beyond such sixty (60) days (B) Access to Records. The Custodian shall allow the Client and its independent public accountants, agents or regulators reasonable access to the records of the Custodian relating to Securities or Cash as is required by the Client in connection with an examination of the books and records pertaining to the affairs of the Client and will seek to obtain such access from each subcustodian and Clearance System. 17. INFORMATION The Custodian will treat information related to the Client as confidential but, unless prohibited by law, the Client authorizes the transfer or disclosure of any information relating to the Client to and between the branches, subsidiaries, representative offices, affiliates and agents of the Custodian and third parties authorized by any of them, wherever situated, for confidential use in connection with the provision of services to the Client (including for data processing, statistical and risk analysis purposes), and further acknowledges that any such branch, subsidiary, representative office affiliate, agent or GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) third party may transfer or disclose any such information as required by any law, court, regulator or legal process. 18. ADVERTISING Neither the Client nor the Custodian shall display the name, trade mark or service mark of the other without the prior written approval of the other nor will the Client display that of Citigroup, Inc. or any subsidiary of Citigroup, Inc without prior written approval from Citigroup, Inc. or the subsidiary concerned. The Client shall not advertise or promote any service provided by the Custodian without the Custodian's prior written consent. 19. TERMINATION (A) Date of Terrnination. Any party may terminate this Agreement in whole or as between itself and the other parties hereto by giving not less than sixty (60) days' prior written notice to such other parties. (B) Effect on Property. The Custodian shall deliver the Securities and Cash as instructed by the Client If by the termination date the Client has not given instructions to deliver any Securities or Cash, the Custodian will continue to safekeep such Securities and/or Cash until the Client provides instructions to effect a free delivery of such However, the Custodian will piovide no other services as regard to any such Securities except to collect and hold any cash distributions. Notwithstanding termination of this Agreement or any Instrubtion, r the Custodian may retain sufficient Securities or Cash to close out or complete any transaction that the Custodian will be required to settle on the Client's behalf. (C) Surviving Terms. The rights and obligations contained in Sections 7, 10, 12, 13, 17, 18 and 20 of this Agreement shall survive the termination of this Agreement. 20. GOVERNING LAW AND JURISDICTION (A) Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws (and not the laws of conflicts) of the State of New York. (B) Jurisdiction. Intentionally deleted. (C) Venue. Each party hereto waives any objection it may have at any time, to the laying of venue of any actions or proceedings brought in any court specified in Section 20(B) hereof, waives any claim that such actions or proceedings have been brought in an inconvenient forum and further waives the right to object that such court does not have jurisdiction over such party. (D) Sovereign Immunity. Intentionally deleted. GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) 21. MISCELLANEOUS (A) Entire Agreement; Amendments. This Agreement consists exclusively of this document together with the schedules. The Custodian may notify the Client of terms which are applicable to the provision of services in the location of a particular office and such terms shall be contained in a schedule and shall supplement this Agreement in relation to that office. In case of inconsistency with the rest of this Agreement, such terms shall prevail in relation to that office. Except as specified in this Agreement, this Agreement may only be modified by written agreement of the Client and the Custodian. (B) Severability. If any provision of this Agreement is or becomes illegal, invalid or unenforceable under any applicable law, the remaining provisions shall remain in full force and effect (as shall that provision under any other law). (C) Waiver of Rights. No failure or delay of the Client or the Custodian in exercising any right or remedy under this Agreement shall constitute a waiver of that right. Any waiver of any right will be limited to the specific instance The exclusion or omission of any provision or term from this Agreement shall not be deemed to be a waiver of any right or remedy the Client or the Custodian may have under applicable law. (D) Recordings. The Client and the Custodian consent to telephonic or electronic recordings for security and quality of service purposes and agree that either may produce telephonic or electronic recordings or computer records as evidence in any proceedings brought in connection with this Agreement. (E) Further Information. The Client agrees to execute further documents and provide materials and information as may be reasonably requested by the Custodian to enable it to perform its duties and obligations under this Agreement. (F) Assignment. No party may assign or transfer any of its rights or obligations under this Agreement without the other's prior written consent, which consent will not be unreasonably withheld or delayed; provided that the Custodian may make such assignment or transfer to a branch, subsidiary or affiliate if it does not materially affect the provision of services to the Client. (G) Headings. Titles to Sections of this Agreement are included for convenience of reference only and shall be disregarded in construing the language contained in this Agreement. (H) Counterparts. This Agreement may be executed in several counterparts, each of which shall be an original, but all of which together shall constitute one and the same agreement. [End of Document] GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized. By: e6or ...,.. :rcer Miller Vice President i3TSIGiobal Custody . - %'reenwjcjj STitle:treet 114th FI. 212.816.6861 N ATTEST: By: Name: Title: • By: CITY OF FORT WORTH, Lender Nam- : Karen L Montgom Title: Assistant City Manager ATTEST: By: gab ael Marty Hend'' ix City Secretary APPROVED TO FORM LEGALITY: B Males is B. Farmer Assistant City Attorney #0,3°°°°°°%frfr000si�np� mo° OFFICIAL RECORD CITY SECRETARY FT. WORTH; TX GCSA 2000 NY - V.11.9.2002- (Std/ City of Fort Worth March 10, 2011) Page 1 of 2 City of Fort Worth, Texas Mayor and Council Communication COUNCIL ACTION: Approved on 3/22/2011 DATE: Tuesday, March 22, 2011 REFERENCE NO.: P-11216 LOG NAME: 13P10-0451 SECURITIES LENDING MJ SUBJECT: Authorize Execution of a Professional Services Agreement with Citibank for the City's Securities Lending Program RECOMMENDATION. It is recommended that the City Council authorize the City Manager to execute an Agreement with Citibank to manage the City's collateralized securities lending program. DISCUSSION: This Agreement will provide securities lending services in accordance with the specifications, terms and conditions as directed by the City. Securities lending is a cash management strategy involving the lending of the City's securities to a primary dealer with the substitution of securities of greater market value being safe -kept by a third party custodial bank in an account in the City's name. The program is designed so that the City earns supplemental income on the portfolio without losing ownership or interest payments on the loaned securities. The safety of the City's securities is guaranteed. Past agreements have provided approximately $250,000.00 average annual revenues to the City. There is no cost to the City. The Purchasing Division issued a Request for Proposals (RFP) on May 19, 2010 soliciting qualified firms to provide certain comprehensive securities lending services in accordance with the specifications, terms and conditions as directed by the City. The evaluation factors included demonstration of the qualifications, competence and capacity of the firm to provide the services, collateral acceptance and investment, aggregate program management, client reporting, securities lending performance and City earnings potential. An evaluation panel was made up of representatives from Financial Management Services and Public Events Departments. Proposals were received from Citibank, Frost National Bank and Morgan Stanley. The recommended vendor, Citibank was determined to be the most qualified to perform the services required. BID ADVERTISEMENT - This bid was advertised in the Fort Worth Star -Telegram on Wednesdays from May 19, 2010 through June 16, 2010. The Purchasing Division solicited 16 vendors from the purchasing system database and three proposals were received. M/WBE - A waiver of the goal for M/WBE subcontracting requirements was requested by the Purchasing Division and approved by the M/WBE Office because the purchase of goods or services is from sources where subcontracting or supplier opportunities are negligible. AGREEMENT TERM - The initial term of the Agreement will begin April 1, 2011 and expire March 31, 2012 http://apps.cfwnet org/ecouncil/printmc.asp?id=14925&print=true&DocType=Preview 3/30/2011 Page 2 of 2 RENEWAL OPTIONS - This agreement may be renewed for up to nine successive one-year terms at the City's option. This action does not require specific City Council approval provided that the City Council has appropriated sufficient funds to satisfy the City's obligations during the renewal term. FISCAL INFORMATION / CERTIFICATION: The Financial Management Services Director certifies that the Financial Management Services Department, Revenue Office will be responsible for the collection and deposit of funds due the City under this agreement. BQN\10-0451 \MJ FUND CENTERS: TO Fund/Account/Centers FRORfl Fund/Account/Centers CERTIFICATIONS: Submitted for City Manaaer's Office by: Oriainatina Department Head: Additional Information Contact: ATTACHMENTS 1. MWBE Waiver.pdf (CFW Internal) Karen Montgomery (6222) Lena Ellis (8517) Jack Dale (8357) Marilyn Jackson (2059) http://apps.cfwnet.org/ecouncil/printmc.asp?id=14925&print true&DocType=Preview 3 /3 0/2 011