Common use of Collateralization Clause in Contracts

Collateralization. All funds on deposit with Bank to the credit of City shall be secured by collateral as provided for in the Public Funds Investment Act (Chapter 2256 of the Texas Government Code as amended), the Public Funds Collateral Act (Chapter 2257 of the Texas Government Code), City’s Investment Policy, and Bank’s Application. If marketable securities are pledged, the total market value of the securities securing such deposits will be in an amount at least equal to the minimum required amount as per City’s Investment Policy. The market value of any pledged securities (collateral) will be obtained from non-Bank- affiliated sources. Bank will monitor and maintain the required collateral margins and levels at all times. Bank has heretofore, or will immediately hereafter, deliver to Custodian collateral of the kind and character above mentioned of sufficient amount and market value to provide adequate collateral for the funds of City deposited with Bank. Custodian will accept said collateral and hold the same in trust for the purpose herein stated. Said collateral or substitute collateral, as hereinafter provided for, shall be kept and retained by Custodian in trust so long as deposits of City remain with Bank. Bank hereby grants a security interest in such collateral to City. If at any time the collateral in the hands of Custodian shall have a market value in excess of the required balances, City may authorize the withdrawal of a specified amount of collateral, and Custodian shall deliver this amount of collateral (and no more) to Bank. If surety bonds or letters of credit are utilized, City shall agree as to the issuer and form of contract prior to the pledge. The amount of surety bonds or letters of credit will be at least equal to the minimum required amount as per City’s Investment Policy. The termination or expiration of any surety bond or letter of credit shall be a minimum of two (2) business days after City anticipates withdrawing the secured deposit.

Collateralization. All funds on deposit with the Bank to the credit of City the Town shall be secured by collateral as provided for in the Public Funds Investment Act (Chapter 2256 of the Texas Government Code as amended), the Public Funds Collateral Act (Chapter 2257 of the Texas Government Code), Citythe Town’s Investment Policy, and the Bank’s Application. The Town agrees to promptly provide to the Bank any changes to its Investment Policy. The Depositor agrees that it shall only direct the Bank in writing to make investments authorized pursuant to the foregoing. If marketable securities are pledgedpledged by the Bank as collateral, the total market value of the securities securing such deposits will shall be in an amount at least equal to the minimum required amount as per Citythe Town’s Investment Policy. The market value of any pledged securities (collateral) will must be obtained from non-Bank- Bank-affiliated sources. The Bank will shall monitor and maintain the required collateral margins and levels at all times. The Bank has heretofore, or will immediately hereafter, deliver to the Custodian collateral of the kind and character above mentioned of sufficient amount and market value to provide adequate collateral for the funds of City the Town deposited with the Bank. The Custodian will shall accept said collateral and hold the same in trust for the purpose purposes herein stated. Said collateral or substitute collateral, as hereinafter provided for, shall be kept and retained by the Custodian in trust so long as deposits of City the Town remain with the Bank. The Bank hereby grants a security interest in such collateral to CityTown. If at any time the collateral in the hands of Custodian shall have a market value in excess of the required balances, City the Town may authorize the withdrawal of a specified amount of collateral, and the Custodian shall deliver this amount of collateral (and no more) to the Bank. If the Bank shall desire to sell or otherwise dispose of any one or more of said securities so deposited with the Custodian, the Bank may substitute for any one or more of such securities other securities of the same market value and of the character authorized herein. Such right of substitution shall remain in full force and may be exercised by the Bank as often as it may desire; provided, however, that the aggregate market value of all collateral pledged hereunder, shall be at least equal to the amount of collateral required hereunder. If at any time, the aggregate market value of such collateral so deposited with the Custodian be less than the total sum of the Town’s funds on deposit with the Bank, the Bank shall immediately deposit with the Custodian such additional collateral as may be necessary to cause the market value of such collateral to equal the total amount of required collateral. The Bank shall be entitled to income on securities held by the Custodian, and the Custodian may dispose of such income as directed by the Bank without approval of the Town. If surety bonds or letters of credit are utilized, City the Town shall agree as to the issuer and form of contract prior to the pledge. The amount of surety bonds or letters of credit will be at least equal to the minimum required amount as per Citythe Town’s Investment Policy. The termination or expiration of any surety bond or letter of credit shall be a minimum of two (2) business days after City anticipates withdrawing the secured deposit.

Collateralization. All funds on deposit with Bank to the credit of City shall be secured by collateral as provided for in the Public Funds Investment Act (Chapter 2256 of the Texas Government Code as amended), the Public Funds Collateral Act (Chapter 2257 of the Texas Government Code), City’s Investment Policy, and Bank’s Application. If marketable securities are pledged, the total market value of the securities securing such deposits will be in an amount at least equal to 102% of deposits plus accrued interest, less the minimum required amount as per City’s Investment Policyinsured by the FDIC. The market value of any pledged securities (collateral) will be obtained from non-Bank- affiliated sources. Bank will monitor and maintain the required collateral margins and levels at all times. The City will inform the Bank of any changes in the amount or activity of deposits, that may exceed the entity’s current Collateral value, within a reasonable time before the change occurs. Bank has heretofore, or will immediately promptly hereafter, deliver to Custodian collateral of the kind and character above mentioned of sufficient amount and market value to provide adequate collateral for the funds of City deposited with Bank. Custodian will accept said collateral and hold the same in trust for the purpose purposes herein stated. Said collateral or substitute collateral, as hereinafter provided for, shall be kept and retained by Custodian in trust so long as deposits of City remain with Bank. Bank hereby grants a security interest in such collateral to City. If at any time the collateral in the hands of Custodian shall have a market value in excess of the required balances, City may authorize the withdrawal of a specified amount of collateral, and Custodian shall deliver this amount of collateral (and no more) to Bank. If surety bonds or letters of credit are utilized, City shall agree as to the issuer and form of contract prior to the pledge. The amount of surety bonds or letters of credit will be at least equal to 100% of deposits plus accrued interest, less the minimum required amount as per City’s Investment Policyinsured by the FDIC. The termination or expiration of any surety bond or letter of credit shall be a minimum of two (2) business days after City anticipates withdrawing the secured deposit.