Loading...
Res. No. 076-01-11224RESOLUTION NO.76-01-11224 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF SOUTH MIAMI,FLORIDA,RELATINGTOTRANSFEROFPENSIONFUNDSACCOUNTFROM STATE STREET TO SALEM TRUST COMPANY,AND APPROVING SALEM TRUST AS THE SUCCESSOR CUSTODIAN COMPANY. WHEREAS,theCityofSouth Miami employee pension funds arecurrently managed by INVESCO Capital Management,andState Street Bank serves as custodian ofthetrust funds;and WHEREAS,because of recentmerger between StateStreetandanotherbank,theirservice feeswereincreasedmakingthemnon-competitive;and WHEREAS,inaneffortto find anotherbanktoprovidecustodialservicesforthetrust funds,theCity Administration solicited bids from three different companies,but received responses fromtwo of the companies namely: Fiduciary Trust,and Salem Trust Company. WHEREAS,thefinancialstatusandoperationsofthecompanieswerereviewedbythe Pension BoardmembersandPensionAttorney,andtheyconcurwiththeInvestment Manager's recommendation that Salem Trust Company be awarded the contract. NOW THEREFORE BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION OF SOUTH MIAMI,FLORIDA,THAT: Section1.theCity Manager isauthorizedtoadviseINVESCOCapital Management totransfer CityofSouthMiamiemployeepension ftinds fromSTATESTREETBANKtoSALEMTRUST COMPANY. Section 2.effectiveimmediately,Salem Trust Companywillserveasthecustodiantothetrust flinds in accordance with the terms and conditions of the City pension plan. Section 3.this resolution shall take effectimmediatelyupon approval. PASSEDANDADOPTEDthis 5th day of June 2001. ST^_ CLERK MAYO COMMISSION VOTE: Mayor Robaina: Vice Mayor Feliu: Commissioner Bethel: Commissioner Russell: Commissioner Wiscombe: 5-0 Yea Yea Yea Yea Yea .... TO:Mayor and City Commission DATE:June 5,2001 FROM:Charles D.Scurr *a |_*/^ City Manager /)////\rJ/fl Re:AGENDA ITEM #JQ_ Transfer of Pension Funds from State Street Bank to Salem Trust Company The Request The attached resolution seeks the City Commission's authorization to award the contract for custodial services of the Pension Fund to Salem Trust Company. Background and Analysis Currently,the Pension Funds are being managed by INVESCO Capital Management,and State Street Bank serves as custodian of the trust funds.Due toa recent merger between State Street and another bank,their service fees have increased making them non-competitive. In an effort tofind another bank to provide custodial services for the trust funds,the City Administration solicited bids from three different companies,but received responses fromtwoof the companies namely: Fiduciary Trust Salem Trust Company The financial status and operations of the companies were reviewed by the Pension Board membersand Pension Attorney,and they concur with the Investment Manager's recommendation that Salem Trust Company be awarded the contract. RECOMMENDATION I recommend approval. CUSTODY AGREEMENT ThisAgreemententered into thisdayof ,2001,ismade byandbetweenThe City ofSouth Miami General Employees'and Police Officers' Retirement Plan (the "Client")andSalemTrust Company ("STC")andiseffectiveasof ,2001. WHEREAS the City of South Miami,Florida,has established The City of South Miami General Employees'and Police Officers'Retirement Plan (the "Account");and WHEREAS,the Client desires toappointSTCas the custodian ofthe assets of theAccountdeliveredtoSTC(the "Custodial Account");and WHEREAS,STCis willing to accept itsappointmentas custodian inaccordance with the terms of this Agreement;and WHEREAS,the Client represents that it has all requisite authority toenter into this Agreement,andthe Client representsthat all actions required for the execution of this Agreement bythe Client and the appointment of STC have been duly taken. NOW,THEREFORE,in consideration of the mutual covenants contained inthis Agreement,theClientandSTC hereby agreeas follows: *1.CUSTODIAL ACCOUNT:The Custodial Account shall consist of cash,cash equivalents,stocks,bonds,and other securities and property,together with the income therefrom,designated by the Client and delivered to STC,which are subject to this Agreement.STC hereby acknowledges that it is a fiduciary with respect to the Custodial Accounttotheextent required by applicable law. 2.APPOINTMENT OF STC:The Client hereby appoints STCasthe custodian of the Custodial Account and STC hereby accepts such appointment and agrees to carry outtheClient's directions regarding theinvestmentand reinvestment of assets of the Custodial Accountandothermatters involving the Custodial Account. 3.DUTIES:STCagreesto (a)hold and safely keeptheassetsofthe Custodial Account;(b)collect the income,interest and dividends paid in cashor in-kind onthe assets of the Custodial Account and credit the same to the Custodial Account;(c)keep accurate records of all receipts and disbursements;and (d)advisethe Client of all maturities,redemptions,exchanges,tenders and shareholder options.Notwithstanding anyother provision containedherein,thedutiesofSTCshallbe limited tothose expressly imposed uponitbythis Agreement. 4.INVESTMENT OF CUSTODIAL ACCOUNT:STC will carry out the timely instructions of the Client,or its Authorized Agent that has been designated in writing as specified in Paragraph 14 herein,which are in writing and received by STC,regarding 'all investments,the purchase,sale or exchange of any securities or other property held Pagel under the Agreement if marketable.STC is authorized to use,for the purchase of any security or property,any uninvested funds held under this Agreement orany other funds made available for such purpose by or on behalf of the Client.If so directed by the Client,STC will utilize itscashmanagement(sweep)service for the Custodial Account.STC will have no liability for uninvested cash balances where STC does not have good funds or the reasons for the uninvested cash balances are beyond the control ofSTC.STCshallhaveno responsibility with regard tothemeritor soundness ofany investment andSTC shall haveno obligation to give the Client any investment advice orto review the investments in the Custodial Account.STC will have no liability for acting in good faith upon any instructions,including oral instructions by phone or otherwise,thatBank reasonably believestohavebeen given bysomeonewhohas been authorized in writing to act onthe Client's behalf.STC will be liable only for actual damages arising from any negligent actsor omissions in the performance of STC's duties hereunder. 5.VOTING:Atthewritten direction oftheClient,orhisauthorized representative STC will vote in the specified manner instructed bythe client or designee,anysharesofstock held in the Custodial Account atany time and exercise bygeneralor limited proxy,any right appurtenanttoanysecuritiesheld in the Custodial Account atany time.Absent such written direction,STC shall not have any responsibility for voting such shares or exercising any right appurtenant to any securities held in the Custodial Account. 6.REGISTRATION:STC will registeranysecuritiesandother assets ofthe Custodial Account in its nominee name,including the nominee name of any of its affiliates or subsidiaries,or in any form permitting title topassby delivery,provided that therecordsofSTCclearlyindicateownershipofthe Custodial Account for the Client. 7.STATEMENTS:STC will furnish statements of transactions and assets tothe Client either monthly or quarterly at the Client's election.The Client acknowledges that ithastherightto receive writtennotificationof all securities transactions withinfive business days ofthe later of (1)the date of the transaction or (2)the receipt by STC of a Broker/Dealer's confirmation ofthe transaction.The Client expressly waives this right and agreesthatSTCdoesnotneedto provide confirmations of purchases andsalesof securitiesotherthanby reporting theminSTC's regular statements. 8.DISTRIBUTIONS TO PARTICIPANTS:All requests for distributions to participants will be directed to STC in writing and signed bythe Client indicating the amount,method,and time of payment;vested interest;dateof participation;date of termination;social security number;last known address;andany other information necessary for STCto carry outits responsibilities under applicable stateand federal laws.STC shall be fully protected against any liability or responsibility in relying and acting upon such written direction. Page2 9.WITHDRAWAL AND TERMINATION:The Client may withdraw anyor all of the property held in the Custodial Account and either party hereto may terminate this Agreementuponreceiptbytheother party of written noticeofsuch withdrawal or termination,at least 30 days before its effective date.The30 day period may be waived with the consent of both the Client and STC. 10.AMENDMENT AND MODIFICATION:ThisAgreementmaybeamendedat any timebyawritten agreement between STC and the Client. 11.AGENTS AND COUNSEL:With prior written approval ofthe Client,STC shall be entitled toemploy suitable agentsand counsel andtopay their reasonable expenses and compensation from the Custodial Account or otherwise.Such agent or counsel mayormaynotbeagentor counsel for the Client.Anysuchexpenses shall be paid from theCustodialAccountunlesspaidbythe Client. 12.INDEMNITY:STC shall be responsible for any liability arising outof this Agreement that is caused by STC's own negligence or willful misconduct.STC may relyuponandshallbeprotectedinactinguponany written direction from the Client or any other written notice,request,consent,certificate,or other instrument reasonably believedbySTCtobegenuineandtohavebeen properly executed.STC shall notbe obligated todefendorengageinanysuitwithrespecttothe Custodial Accountunless STC shall first have agreed in writing to do so and it shall have been fully indemnified to its satisfaction. 13.FEESAND EXPENSES:STC shall be entitledto fees forits services as described on Exhibit A attached.With prior board approval,these fees may be directly debited from the trust account.In addition,STC shall be reimbursed for any reasonable expenses,including counsel and agent expenses and compensation, incurred by it as custodian.Such fees or expenses will be charged tothe Client or against the Custodial Account if necessary and continue to bea liability until paid. 14.AUTHORIZED AGENTS:The Client may designate one or more agents or other individuals who may give instructions to STC regarding the Custodial Account, and to change authorized agents or add additional agents by written notice to STc! Exhibit B,executed by the Client and attached hereto,is a list of individuals,and their specimensignatures,whoareauthorizedtoactonbehalfofthe Client.TheClient shall promptly notify STC in writing of any change tothe list of authorized agents or individuals.STC shall be fully protected in relying on the direction from any authorized agent or individual until it receives written notice otherwise. 15.SEPARABILITY:If any provision of this Agreement is held tobe illegal, invalid or unenforceable under present or future law,such provision shall be fully separable and this Agreement shall be construed and enforced asif such illegal,invalid or unenforceable provision is not a part of this Agreement.In that instance,the remaining provisionsofthis Agreement shallremainin full forceand effect andshall Page3 not be affected bythe illegal,invalid or unenforceable provision oritsseverance from this Agreement. 16.GOVERNING LAW:ThisAgreementshallbeconstruedinaccordance with the laws oftheStateof Florida,and the venue shall be Broward County. 17.LEGAL FEES:Should a conflict arise that results in legal action,the prevailing party shall be entitled to recover all reasonable attorney fees and expenses relatedto such legalaction. 18.HEADINGS:The headings in this Agreement are provided for convenience purposes only.They shallnotbe binding inthe interpretation or construction ofthis Agreement. 19.COUNTERPARTS:ThisAgreementmaybeexecuted in twoor more counterparts,eachoneof which shall bedeemedtobean original. 20.ENTIRE AGREEMENT:This Agreement constitutes the entire agreement of thepartieswith respect to the management of the CustodialAccount. 21.NOTICES:Any notices or communications which either party hereto may be required or permitted to make to the other shall be in writing and shall be delivered,to the other partyat the address set forth below. If to the Client: Page4 Ifto Salem Trust Company: Senior Trust Officer 455 Fairway Drive.Suite 103 Deerfield Beach.FL 33441 22.SPECIAL INSTRUCTIONS: IN WITNESS WHEREOF the parties hereto have set their hands and sealsthe day and year first above written: WITNESS TO CLIENT: Client's Tax Identification Number: WITNESS TO STC: Page5 CLIENT: BY: TITLE: SALEM TRUST COMPANY BY: TITLE: Exhibit B Signature Authorization To Custody Agreement Between TheCityofSouth Miami GeneralEmployees'andPolice Officers'RetirementPlan and Salem Trust Company Account Numbers: AUTHORIZATION:The following arethenamesandspecimen signatures ofthe individuals authorized toexecuteand direct SalemTrust Company. SalemTrustCompany will relyonthe following individuals for all direction until notified otherwise: PRINTED NAME SIGNATURE Numberof Signatures Required: !•—•as ,certify that the above individuals are authorized to direct Salem Trust Company under thetermsofthe current agreement. Dated thisdayof ,20 (Signature) Exhibit A Fee Schedule To Custody Agreement Between The City of South Miami General Employees'and Police Officers'Retirement Plan and Salem Trust Company Afeecalculatedattherateof6 basis points(.0006)peryearappliedtothemarket valueofthe assets in the account will becharged for custody andpayment services Thisfeecoverscustodyandsafekeepingofassets,thesettlementof security purchases and sales andtheaccompanyingreceiptanddeliveryof assets,the collection ofincome,theprocessingof corporate actions,the delivery ofmonthly statements,the daily sweep of cash balances intoa money market account, distributions of funds as directed by the Client,and on-line access to account information.ThisfeecoversdomesticsecuritiesandADR's,andincludes activity for one investment manager.There isaminimumannualfee of $5,000.00. Fees will notincrease for atleasttwoyears from theeffectivedateofthisagreement. Fees are calculated and are payable quarterly.