HomeMy WebLinkAboutItem 06 Approval of Resolution Authorizing the Revision of the Interlocal Agreement and Trust Instrument for the Florida Short Term Asset Reserve ocoee
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AGENDA ITEM COVER SHEET
Meeting Date: August 20, 2018
Item # �p
Reviewed By:
Contact Name: Rebecca Roberts, Director Department Director:, •
Contact Number: 407-905-3190 City Manager: �� 121111111
Subject: Approval of Resolution Authorizing the Revision of the Int- ocal Agreement and
Trust Instrument for the Florida Short Term Asset Reserve.
Background Summary:
In June 2018, the Commission Authorized the City to enter into an interlocal agreement with another Florida
agency for the purpose of establishing a local investment pool (Florida Statutes 163.01 and 218.415). The
investment pool, Florida Short Term Asset Reserve (FLSTAR) is administered by Hilltop Securities and Managed
by J.P. Morgan.
Hilltop Securities have requested certain revisions to the interlocal agreement that:
• Allow for an additional method to join the pool for CFOs or Finance Directors who have been designated
authority by their governing body to invest in any investments authorized by their investment policy without
additional approval of their board. The City will continue to follow its investment policy as approved by the
Commission in June of 2018.
• Clarify the language so that all political subdivisions like state universities, public utilities, etc. are all
clearly eligible to participate.
Membership in the investment pool has allowed the City to diversify its investment of surplus funds while earning
market driven returns.
Recommendation:
Staff recommends the City Commission adopt the Resolution and approve the Amended and Restated Interlocal
Agreement and Trust Instrument for the Florida Short Term Asset Reserve allowing for non-substantive changes
that may be recommended by the City attorney.
Attachment:
• Resolution
• Amended and Restated Interlocal Agreement and Trust Instrument for the Florida Short Term
Asset Reserve.
Financial Impact: There is no financial impact.
Type of Item: (please mark with an 'x')
Public Hearing For Clerk's Dept Use:
Ordinance First Reading x Consent Agenda
Ordinance Second Reading Public Hearing
Resolution Regular Agenda
x Commission Approval
Discussion& Direction
Original Document/Contract Attached for Execution by City Clerk
Original Document/Contract Held by Department for Execution
Reviewed by City Attorney N/A
Reviewed by Finance Dept. ,� � 11.o N/A
RESOLUTION NO. 2019-
A RESOLUTION OF THE CITY COMMISSION OF THE CITY
OF OCOEE,FLORIDA AUTHORIZING THE EXECUTION AND
DELIVERY OF AN AMENDED AND RESTATED
INTERLOCAL AGREEMENT FOR THE PURPOSE OF JOINTLY
EXERCISING ITS POWER TO INVEST SURPLUS FUNDS IN
AN INTERGOVERNMENTAL INVESTMENT POOL
PURSUANT TO SECTION 218.415,FLORIDA STATUTES,AND
SECTION 163.01, FLORIDA STATUTES; APPROVING THE
INVESTMENT OF CERTAIN SURPLUS FUNDS IN THE
FLORIDA SHORT TERM ASSET RESERVE;APPOINTING AN
AUTHORIZED REPRESENTATIVE; AND PROVIDING AN
EFFECTIVE DATE.
WHEREAS,Section 218.415, Florida Statutes, authorizes any governmental entity within
the State of Florida (the "State") and not part of State government, including, but not limited to,
counties,municipalities,school districts,special districts,clerks of circuit court,sheriffs,property
appraisers,tax collectors,supervisors of elections,authorities,boards,public corporations,or any
other political subdivision of the State(each a"Unit of Local Government"and,collectively,"Units
of Local Government") to invest and reinvest any surplus funds in their control or possession in
any intergovernmental investment pool authorized pursuant to Section 163.01, Florida Statutes;
and
WHEREAS, Section 163.01, Florida Statutes, permits political subdivisions, agencies, or
officers of the State, including, but not limited to State government, counties, cities, school
districts, single and multipurpose special districts, single and multipurpose public authorities,
metropolitan or consolidated governments, separate legal entities or administrative entities
created under Section 163.01(7), Florida Statutes, or independently elected county officers (each
a "Public Agency" and, collectively, "Public Agencies"), to enter into an interlocal agreement to
jointly exercise any power, privilege, or authority which such Public Agencies share in common
and which each might exercise separately, permitting the Public Agencies to make the most
efficient use of their powers by enabling them to cooperate on a basis of mutual advantage and
thereby provide for the sharing of their powers in a manner and pursuant to forms of
governmental organization that are in the best interests of the Public Agencies; and
WHEREAS, the City of Ocoee, Florida is a Public Agency, and is authorized pursuant to
Section 218.415 of the Florida Statutes, and its own local laws to invest certain of its surplus funds
in statutorily permitted investments, including, but not limited to, any intergovernmental
investment pool authorized pursuant to Section 163.01, Florida Statutes; and
WHEREAS,the City of Ocoee,Florida previously approved an Interlocal Agreement and
Trust Instrument for the Florida Short Term Asset Reserve on June 19, 2018 by Resolution No.
2018-015 (the "Original Resolution"); and
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WHEREAS, the City of Haines City, Florida, also entered into the Interlocal Agreement
and Trust Instrument for the Florida Short Term Asset Reserve (the "Original Interlocal
Agreement"), which became effective on March 21, 2019; and
WHEREAS,the City of Ocoee,Florida and the City of Haines City,Florida wish to amend
and restate the Original Interlocal Agreement by entering into that certain Amended and Restated
Interlocal Agreement which is attached hereto as Exhibit A (as may be further amended or
supplemented from time to time pursuant to its terms, the "Interlocal Agreement"), in order to
increase the benefits to be attained by the Interlocal Members (as defined in the Interlocal
Agreement), by the intergovernmental investment pool known as the Florida Short Term Asset
Reserve ("FLSTAR"), which is an intergovernmental investment pool as described in Section
218.415, Florida Statutes, to-wit: (a) participate in diversified and professionally managed
Portfolios (as defined in the Interlocal Agreement) to meet investment needs, (b) create greater
purchasing powers through economies of scale,(c)lower the costs associated with the investment
and reinvestment of surplus funds;and(d)be provided assistance on investment alternatives and
other investment issues of concern; and
WHEREAS,FLSTAR is to be managed, operated, and supervised by a board of trustees,
which is a separate legal entity and public body corporate and politic pursuant to Section
163.01(7), Florida Statutes; and
WHEREAS, the City of Ocoee, Florida further desires to invest and reinvest a portion of
its surplus funds in FLSTAR; and
WHEREAS, the City of Ocoee, Florida has adopted written investment policies
authorizing investment in intergovernmental investment pools authorized pursuant to Section
163.01, Florida Statutes, and with respect to the funds to be invested in such intergovernmental
investment pools, all authorized investments set forth in the investment policies of such
intergovernmental investment pools.
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Ocoee,
Florida as follows:
SECTION 1. AUTHORITY.This Resolution of the City of Ocoee,Florida
(the "City") is adopted pursuant to the provisions of Section 163.01, Florida Statutes
(the "Interlocal Act"), Section 218.415, Florida Statutes (the "Local Government
Investment Act"), and other applicable provisions of law (collectively, the"Act").
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SECTION 2. INTERLOCAL AGREEMENT.
(a) Pursuant to Article VI of the Interlocal Agreement, the City hereby
approves and joins the Interlocal Agreement, a copy of which is attached hereto as
Exhibit A and incorporated herein by reference, as an Initial Interlocal Member and
agrees to be bound by all of the terms and provisions thereof.
(b) The Mayor,as attested by the City Clerk,or their duly authorized designee,
are hereby authorized and directed to execute and deliver the Interlocal Agreement,
with such changes, amendments, modifications, deletions, and additions as may be
approved by the Mayor or his or her duly authorized designee, the execution thereof
being conclusive evidence of such approval.
(c) The Interlocal Agreement constitutes a joint exercise of power, privilege,
or authority by and between the Interlocal Members thereunder and is deemed to be
an"interlocal agreement"within the meaning of the Interlocal Act.The City shall cause
this Resolution and the Interlocal Agreement with the Clerk of the Circuit Court in the
County of the City or in the county where FLSTAR maintains its principal place of
business, as provided in section 163.01(11), Florida Statutes.
SECTION 3. INVESTMENT IN FLSTAR; APPOINTMENT OF
AUTHORIZED REPRESENTATIVE; TAX PAYER IDENTIFICATION NUMBER;
CONTACT INFORMATION.
(a) The City is hereby authorized to invest and reinvest a portion of its surplus
funds in one or more Portfolios of FLSTAR. The City hereby acknowledges the board
of trustees' power to supervise FLSTAR and hereby agrees the surplus funds
transferred to FLSTAR shall be held and managed in trust by the board of trustees for
the City's benefit.
(b) The officers, officials, or employees of the City designated as "Authorized
Representatives"for purposes of the Interlocal Agreement in Resolution No. 2018-015
are hereby reapproved, ratified, and confirmed. The City confirms that is taxpayer
identification number and contact information set forth in Resolution No. 2018-015
remains in full force and effect.
SECTION 4. DIRECTION AND AUTHORITY. The officials, officers,
attorneys, and other agents or employees of the City are directed and authorized to
do all acts and things required of them by this Resolution and the Interlocal
Agreement for the full, punctual, and complete performance of all the terms,
covenants, and agreements provided for herein and therein, and each of the officials,
officers, attorneys, or other agents or employees are hereby authorized and directed
to execute and deliver any and all papers and instruments (including any agreements
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required for use of online portals related to FLSTAR) and to do and cause to be done
all acts and things necessary or proper for carrying out the activities and actions
contemplated by this Resolution and the Interlocal Agreement.
SECTION 5. INVESTMENT POLICIES. With respect to the surplus
funds to be invested in FLSTAR, to the extent the written investment policies of the
City adopted pursuant to Section 218.415, Florida Statutes(the "Investment Policies"),
is inconsistent with the investment policies of FLSTAR, the City hereby amends the
Investment Policies to include as an authorized investment FLSTAR and all
authorized investments set forth in the investment policies of FLSTAR, as such
investment policies may be amended from time to time in accordance with the
Interlocal Agreement.
SECTION 6. EFFECTIVE DATE. This Resolution shall take effect
immediately upon its filing with the Clerk of the Circuit Court in the County of the
City or in the county where FLSTAR maintains its principal place of business.
PASSED AND ADOPTED at a meeting held on the day of , 20_.
APPROVED:
ATTEST: CITY OF OCOEE,FLORIDA
Melanie Sibbitt, City Clerk Rusty Johnson,Mayor
(SEAL)
APPROVED BY THE OCOEE CITY
COMMISSION ON , 2019
UNDER AGENDA ITEM NO.
FOR USE AND RELIANCE ONLY
BY THE CITY OF OCOEE,APPROVED
AS TO FORM AND LEGALITY
THIS DAY OF ,2019
SHUFFIELD,LOWMAN&WILSON
By:
City Attorney
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AMENDED AND RESTATED
INTERLOCAL AGREEMENT AND TRUST INSTRUMENT
FOR THE
FLORIDA SHORT TERM ASSET RESERVE
THIS AMENDED AND RESTATED INTERLOCAL AGREEMENT AND TRUST
INSTRUMENT (together with any amendments and supplements, referred to as this
"Agreement") is made and entered into by and among each of those Public Agencies (as defined
herein) initially executing this Agreement and any other Public Agency that is eligible and
becomes a party hereto(each an"Interlocal Member"and,collectively,the"Interlocal Members").
WHEREAS, Section 218.415, Florida Statutes, authorizes any governmental entity within
the State of Florida (the "State") and not part of State government, including, but not limited to,
counties,municipalities,school districts,special districts,clerks of circuit court,sheriffs,property
appraisers,tax collectors,supervisors of elections,authorities,boards,public corporations,or any
other political subdivision of the State(each a"Unit of Local Government"and,collectively,"Units
of Local Government") to invest and reinvest any Surplus Funds (as defined herein) in their
control or possession in any intergovernmental investment pool authorized pursuant to Section
163.01,Florida Statutes;and
WHEREAS, Section 163.01, Florida Statutes, permits political subdivisions, agencies, or
officers of the State, including, but not limited to State government, counties, cities, school
districts, single and multipurpose special districts, single and multipurpose public authorities,
metropolitan or consolidated governments, separate legal entities or administrative entities
created under Section 163.01(7), Florida Statutes, or independently elected county officers (each
a "Public Agency" and, collectively, "Public Agencies"), to enter into an interlocal agreement to
jointly exercise any power, privilege, or authority which such Public Agencies share in common
and which each might exercise separately, permitting the Public Agencies to make the most
efficient use of their powers by enabling them to cooperate on a basis of mutual advantage and
thereby provide for the sharing of their powers in a manner and pursuant to forms of
governmental organization that are in the best interests of the Public Agencies;and
WHEREAS, each Interlocal Member constitutes a Public Agency, and each Interlocal
Member is authorized to invest and reinvest its Surplus Funds in an intergovernmental
investment pool created pursuant to Section 163.01,Florida Statutes; and
WHEREAS, the Interlocal Members desire to establish and maintain an
intergovernmental investment pool to be known as the Florida Short Term Asset Reserve
("FLSTAR"), which shall be an intergovernmental investment pool as described in Section
218.415, Florida Statutes, and managed, operated, and supervised by a board of trustees, which
shall be a separate legal entity and public body corporate and politic pursuant to Section 163.01(7),
Florida Statutes; and
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WHEREAS, establishing and maintaining FLSTAR is in the best interest of the Interlocal
Members and other Participants (as defined herein), their officials, officers, and citizens in that
FLSTAR will (a) offer diversified and professionally managed Portfolios (as defined herein) to
meet investment needs, (b) create greater purchasing powers through economies of scale, (c)
lower the costs associated with the investment and reinvestment of Surplus Funds; and (d)
provide assistance on investment alternatives and other investment issues of concern to the
Interlocal Members and the other Participants;and
WHEREAS, the joint exercise of the power to invest Surplus Funds will be benefited and
made more efficient if (a) all investments acquired pursuant to this Agreement are held by the
Custodian (as defined herein), which will hold such investments for the benefit of the Interlocal
Members and the other Participants, and (b) the record-keeping and other administrative
functions are performed by the Co-Administrators (as defined herein); and
WHEREAS, each Interlocal Member has duly taken all official action necessary and
appropriate to become a party to this Agreement and perform hereunder, including, the passing
of any ordinances, resolutions, or taking of other actions required under Section 218.415,Florida
Statutes, and other applicable laws and regulations;
NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements contained herein, each Participant agrees that all Surplus Funds it transfers to
FLSTAR on or after the effective date hereof shall be held and managed in trust by a board of
trustees for the benefit of the Participant, and the Participants mutually agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINITIONS. Except as otherwise provided in this Agreement,
the capitalized terms used herein shall have the following meanings unless the context otherwise
requires:
"Account" or "Accounts"means any account established by a Participant.
"Additional Party Agreement" means a document substantially in the form attached
hereto as Appendix A which, when attached to a copy of this Agreement and executed by an
Authorized Representative of a Public Agency,constitutes a valid and binding counterpart of this
Agreement and results in the Public Agency becoming a party to this Agreement.
"Authorized Investments" means those investments which are authorized from time to
time to be purchased, sold, and invested in under Section 218.415, Florida Statutes, or other
applicable law, and as further defined in the Investment Policies.
93931518.2
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"Authorized Representative" means any Person authorized to execute documents and
take other necessary actions, pursuant to this Agreement, on behalf of a Participant or other
Person, as evidenced by a duly adopted ordinance, resolution or bylaw of the governing body of
such Participant or other Person, a certified copy of which is on file with HTS.
"Board" means the governing body of FLSTAR, known as The Board of Trustees of
FLSTAR, created by this Agreement as a separate legal entity and public body corporate and
politic pursuant to Section 163.01(7),Florida Statutes.
"Bylaws" means the bylaws adopted by the Board, as the same may be amended and
supplemented from time to time, subject to the requirements of this Agreement.
"Co-Administration Agreement"means the Agreement for Investment Management and
Related Services,by and between HTS,JPMIM,and the Board,as the same may be amended and
supplemented from time to time, and successor agreement related to FLSTAR.
"Co-Administrators" mean, collectively, HTS and JPMIM, or such other Persons
appointed, employed, or contracted with by the Board pursuant to this Agreement.
"Custodian" means JPMorgan Chase Bank, N.A., a national banking association, and/or
an affiliate thereof, or such other Persons appointed, employed, or contracted with by the Board
pursuant to this Agreement.
"FLSTAR" means the Florida Short Term Asset Reserve, which is an intergovernmental
investment pool as described in Section 218.415, Florida Statutes, and an instrumentality of the
Interlocal Members, managed by the Board, and which consists of all Trust Assets of FLSTAR
that are held in trust for the benefit of the Participants.
"HTS"means Hilltop Securities Inc.,a corporation organized under the laws of Delaware.
"Information Statement" means the information statement or any other document
distributed to Participants and potential Participants to provide them with a description of the
management and operation of FLSTAR, as the same may be amended from time to time, subject
to the requirements of this Agreement.
"Initial Interlocal Members" shall mean Public Agencies initially executing this
Agreement.
"Interlocal Act" means the Florida Interlocal Cooperation Act of 1969, Section 163.01,
Florida Statutes.
"Interlocal Members" means the Initial Interlocal Members and the Public Agencies
which subsequently become parties to this Agreement.
93931518.2
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"Investment Officer" means one or more officers or employees of the Board designated
as investment officers by the Board.
"Investment Policies" means the written investment policies adopted and approved by
the Board governing investment and management of the Trust Assets of one or more Portfolios,
as the same may be amended and supplemented from time to time, subject to the requirements
of this Agreement.
"Investor" means a Unit of Local Government or Public Agency which is authorized to
invest its Surplus Funds in an intergovernmental investment pool pursuant to Section 218.415,
Florida Statutes,or other Florida law,but is not party to this Agreement as an Interlocal Member.
"JPMIM" means J.P. Morgan Investment Management Inc., a corporation organized
under the laws of Delaware.
"Participant(s)"means, collectively,the Interlocal Members,Investors, and other Units of
Local Government which elect to invest in one or more Portfolios of FLSTAR.
"Person" means any county, municipal corporation, national association, district,
corporation, limited liability company, limited liability partnership, natural person, firm, joint
venture, partnership, trust, unincorporated organization, group, government, or any political
subdivision, department, board, commission, instrumentality, or agency of any governmental
entity.
"Portfolio"means a portfolio of Trust Assets in FLSTAR which is held separate from other
assets of FLSTAR and which is invested with a defined investment objective which may be
different from other Portfolios in FLSTAR, and in which a Participant may elect to invest its
Surplus Funds.
"Public Agency" means all Units of Local Government and all political subdivisions,
agencies, or officers of the State, including, but not limited to State government, counties, cities,
school districts, single and multipurpose special districts, single and multipurpose public
authorities, metropolitan or consolidated governments, separate legal entities or administrative
entities created under Section 163.01(7),Florida Statutes,or independently elected county officers,
which are authorized to enter into interlocal agreements pursuant to the Interlocal Act as may be
amended from time to time.
"State"means the State of Florida.
"Surplus Funds" means any funds in any general or special account or fund of a
Participant, or funds held by an independent trustee on behalf of a Participant, which in
reasonable contemplation will not be immediately needed for the purposes intended.
93931518.2
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"Trust Assets" means, as of any particular time, any and all Surplus Funds transferred,
conveyed, or paid to FLSTAR, all investments purchased with such Surplus Funds, and all
income, profits, and gains therefrom and which, at such time, is owned or held by, or for the
account of, FLSTAR.
"Trustee" or "Trustees" means the Person or Persons selected to serve on the Board
pursuant to this Agreement.
"Unit of Local Government"means any governmental entity within the State and not part
of State government, including, but not limited to, counties, municipalities, school districts,
special districts, clerks of circuit court,sheriffs,property appraisers, tax collectors,supervisors of
elections, authorities,boards, public corporations, or any other political subdivision of the State,
which is authorized to invest its Surplus Funds in an intergovernmental investment pool
pursuant to Section 218.415,Florida Statutes, or other Florida law.
"Unitholder"means a record owner of Units in any Portfolio of FLSTAR.
"Units" means equal proportionate units of undivided beneficial interest in the Trust
Assets of any Portfolio, from time to time, including fractions of units as well as whole units.
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93931518.2
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ARTICLE II
FLSTAR
SECTION 2.01. ESTABLISHMENT AND CREATION.
(a) The Interlocal Members hereby establish and agree to jointly invest certain of their
Surplus Funds in an intergovernmental investment pool, to be known as the Florida Short Term
Asset Reserve, which is an intergovernmental investment pool as described in Section 218.415,
Florida Statutes,and to permit Investors and Participants to jointly invest their respective Surplus
Funds in FLSTAR.
(b) FLSTAR is organized and existing as a common law trust under the laws of the
State with the Surplus Funds of the Participants deposited to FLSTAR and all other Trust Assets
held and managed in trust by the Board for the benefit of the Participants.
(c) FLSTAR is not intended to be, shall not be deemed to be, and shall not be treated
as, a general partnership, limited partnership, joint venture, corporation, investment company,
or joint stock company. The Participants shall be beneficiaries of FLSTAR, and their relationship
to the Trustees shall be solely in their capacity as Participants and beneficiaries in accordance
with the rights conferred upon them hereunder.
(d) No Participant shall be required to appropriate any funds or levy any taxes to
establish or invest in FLSTAR.
(e) FLSTAR may consist of one or more Portfolios and the Participants may select the
Portfolio or Portfolios in which they wish to deposit their Surplus Funds.A Participant's share in
a Portfolio is represented by Units.
SECTION 2.02. PURPOSE.
(a) The purpose of FLSTAR is to provide an intergovernmental investment pool in
accordance with Section 218.415, Florida Statutes, through which the Participants may invest
certain of their Surplus Funds in one or more Portfolios that best suit a Participant's investment
needs, all in accordance with the law governing the investment of the Surplus Funds of such
Participants.
(b) FLSTAR will place the highest priority on the safety of principal and liquidity of
funds,and the optimization of investment returns shall be secondary to the requirement for safety
and liquidity.
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ARTICLE II
FLSTAR
SECTION 2.01. ESTABLISHMENT AND CREATION.
(a) The Interlocal Members hereby establish and agree to jointly invest certain of their
Surplus Funds in an intergovernmental investment pool, to be known as the Florida Short Term
Asset Reserve, which is an intergovernmental investment pool as described in Section 218.415,
Florida Statutes,and to permit Investors and Participants to jointly invest their respective Surplus
Funds in FLSTAR.
(b) FLSTAR is organized and existing as a common law trust under the laws of the
State with the Surplus Funds of the Participants deposited to FLSTAR and all other Trust Assets
held and managed in trust by the Board for the benefit of the Participants.
(c) FLSTAR is not intended to be, shall not be deemed to be, and shall not be treated
as, a general partnership, limited partnership, joint venture, corporation, investment company,
or joint stock company. The Participants shall be beneficiaries of FLSTAR, and their relationship
to the Trustees shall be solely in their capacity as Participants and beneficiaries in accordance
with the rights conferred upon them hereunder.
(d) No Participant shall be required to appropriate any funds or levy any taxes to
establish or invest in FLSTAR.
(e) FLSTAR may consist of one or more Portfolios and the Participants may select the
Portfolio or Portfolios in which they wish to deposit their Surplus Funds. A Participant's share in
a Portfolio is represented by Units.
SECTION 2.02. PURPOSE.
(a) The purpose of FLSTAR is to provide an intergovernmental investment pool in
accordance with Section 218.415, Florida Statutes, through which the Participants may invest
certain of their Surplus Funds in one or more Portfolios that best suit a Participant's investment
needs, all in accordance with the law governing the investment of the Surplus Funds of such
Participants.
(b) FLSTAR will place the highest priority on the safety of principal and liquidity of
funds,and the optimization of investment returns shall be secondary to the requirement for safety
and liquidity.
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ARTICLE III
THE BOARD
SECTION 3.01. ESTABLISHMENT AND CREATION.
(a) The Interlocal Members hereby agree to create and establish a board of trustees of
FLSTAR, known as The Board of Trustees of FLSTAR, as a separate legal entity and public body
corporate and politic pursuant to Section 163.01(7), Florida Statutes. The business and affairs of
FLSTAR shall be managed by the Board as governing body of FLSTAR.
(b) The Participants delegate to FLSTAR through its Board,the authority to hold legal
title to and manage all Trust Assets transferred to or acquired by FLSTAR pursuant to this
Agreement. All such Trust Assets shall be held in trust for the benefit of the Participants.
(c) The Board is authorized to adopt Bylaws which shall set forth,among other things,
the procedure for holding meetings, the election of officers, and other matters necessary or
desirable for governance by the Board.
(d) The chief administrative office of the Board shall be located in Orlando, Florida.
The Board may also have offices at such other places within the State as the Board may from time
to time determine or the business of the Board may require.
SECTION 3.02. POWERS AND DUTIES.
(a) General.Subject to applicable law and the terms of this Agreement,the Board shall
have full and complete power to take all actions, do all things, and execute all instruments as it
deems necessary or desirable in order to carry out,promote,or advance the investment objective,
interests, and purposes of FLSTAR to the same extent as if the Board was the sole and absolute
owner of FLSTAR,although such actions,matters,or things are not herein specifically mentioned.
Any determination as to what is in the best interest of FLSTAR made by the Board in good faith
shall be conclusive. In construing the provisions of this Agreement, the presumption shall be in
favor of a grant of power to the Board.
(b) Establishment of Portfolios and Units.
(i) The Initial Trustees(as defined herein)have by this Agreement created and
established the following Portfolios: the Government Fund and the Prime Fund. The
Government Fund shall be governed by the Investment Policies substantially in the form
attached hereto as Appendix D as such Investment Policies may be amended by the Board
from time to time. The Prime Fund shall be governed by the Investment Policies
substantially in the form attached hereto as Appendix E, as such Investment Policies may
be amended by the Board from time to time.
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(ii) The Board shall have full power and authority, in their sole discretion and
without obtaining any prior authorization or vote of the Unitholders to create and
establish Portfolios and to establish Units with such preferences, voting powers, rights,
and privileges as the Board may from time to time determine; to divide or combine the
Units thereof into a greater or lesser number; to value such Units in a manner consistent
with the goals of the Portfolio;to classify or reclassify any existing Units into the Portfolio;
to charge fees and costs, including indemnity costs, against the Trust Assets of each
Portfolio in such amount as the Board determines to be equitable; and to take such other
action with respect to the Units as the Trustees may deem desirable; provided that the
Trustees may take no action pursuant to this Section 3.02(b) which would impair the
beneficial interests of Unitholders in the then-existing Trust Assets.
(c) Investments and Investment Policies.The Board shall have the power to subscribe
for, invest in, reinvest in, purchase, or otherwise acquire, hold, pledge, sell, assign, transfer,
exchange, distribute, or otherwise deal in or dispose of Authorized Investments pursuant to the
Investment Policies. The Board shall adopt and maintain such Investment Policies, consistent
with the general objective of FLSTAR, which shall provide more detailed guidelines for
investment and management of the Trust Assets.
(d) Title to Investments.
(i) Legal title to the Trust Assets shall be vested in the Board on behalf of the
Participants and shall be held by and transferred to the Board, except that the Board shall have
full and complete power to cause legal title to any of the Trust Assets to be held, if permitted by
law, in the name of any other Person as nominee, on such term, in such manner, and with such
powers as the Board may determine, so long as in the judgment of the Board the interests of the
Board and the Participants are adequately protected.
(ii) The Board shall have full and complete power to exercise all of the rights,
powers, and privileges appertaining to the ownership of the Trust Assets to the same extent that
any individual might, and, without limiting the generality of the foregoing, to vote or give any
consent,request,or notice, or waive any notice either in person or by proxy or power of attorney,
with or without the power of substitution, to one or more Persons, which proxies and powers of
attorney may be for meetings or actions generally, or for any particular meeting or action, and
may include the exercise of discretionary powers.
(e) Operating Procedures.The Board shall adopt and maintain Operating Procedures,
which shall provide more detailed information on the procedures for depositing Surplus Funds,
withdrawing funds from FLSTAR, calculation of Units, and determination of net income and net
asset value.
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(f) Information Statement. The Board shall prepare, or direct the preparation of, an
Information Statement that describes how FLSTAR will operate in accordance with the terms of
this Agreement and the Investment Policies.
(g) Expenses. The Board shall have full and complete power to use, or direct the use
of, the Trust Assets held by FLSTAR in any one or more Portfolios, as determined by the Board,
for the following purposes: (i) incur and pay any charges,fees,or expenses which,in the opinion
of the Board, are necessary or incidental to or proper for carrying out any of the purposes of this
Agreement; (ii) pay any taxes or assessments validly and lawfully imposed upon or against the
Trust Assets or any part thereof or the Board in connection with the Trust Assets; (iii) reimburse
others for the payment of such charges, fees, expenses, and taxes; (iv) pay appropriate
compensation or fees from the Trust Assets to persons with whom the Board has contracted or
transacted business; and (v) charge a Participant's Account for any special fees, charges, or
expenses related specifically to transactions in such Account.
(h) Contract,Appoint,Retain,and Employ. Subject to applicable law and the terms of
this Agreement, the Board shall have full and complete power to appoint, employ, retain, or
contract with any Person of suitable qualifications and high repute as the Board may deem
necessary or desirable for the transaction of the affairs of FLSTAR.
(i) Insurance. The Board shall have full and complete power to purchase or to cause
to be purchased and pay for,entirely out of the Trust Assets held by FLSTAR in any one or more
Portfolios, as determined by the Board, insurance policies insuring FLSTAR, the Board, and
officers, employees, and agents of FLSTAR individually against all claims and liabilities of every
nature arising by reason of holding or having held any such office or position,or by reason of any
action alleged to have been taken or omitted by FLSTAR or any such person, officer, employee,
and agent,including any action taken or omitted that may be determined to constitute negligence,
whether or not FLSTAR would have the power to indemnify such person against such liability.
(j) Borrowing and Indebtedness. The Board shall not borrow money or incur
indebtedness, whether or not the proceeds thereof are intended to be used to purchase
Authorized Investments or the Trust Assets, except as a temporary measure to facilitate the
transfer of funds to the Participant which might otherwise require unscheduled dispositions of
Portfolio investments,but only to the extent permitted by law. No such indebtedness shall have
a maturity later than that necessary to avoid the unscheduled disposition of Portfolio
investments.
(k) Remedies. Notwithstanding any provision of this Agreement, when the Board
deems that there is a significant risk that an obligor to FLSTAR may default or is in default under
the terms of any obligation of FLSTAR, the Board shall have full and complete power to pursue
any remedies permitted by law which, in the sole judgment of the Board, are in the interests of
FLSTAR, and the Board shall have full and complete power to enter into any investment,
93931518.2
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commitment, or obligation of FLSTAR resulting from the pursuit of such remedies as are
necessary or desirable to dispose of property acquired in the pursuit of such remedies.
(1) Claims. The Board shall have full power to compromise, arbitrate, or otherwise
adjust claims in favor of or against FLSTAR.
(m) Books and Records.The Board shall keep correct and complete books and records
of account, minutes of the proceedings of the Board, and a record of the Participants (and their
addresses and the number and class of the Units held by each) at its registered office or principal
place of business or at the office of a Co-Administrator or the Custodian. The record books of
FLSTAR shall be conclusive as to the Unitholders and the number of Units held from time to time
by each Unitholder.
(n) Financial Statements. The Board shall cause financial statements to be prepared
and maintained for FLSTAR and for such statements to be audited annually by an independent
certified public accounting firm.
(o) Investment Officers.The Board shall designate one or more investment officers for
FLSTAR.
(p) Educational Opportunities.The Board may provide seminars or other information
and educational opportunities to Participants on investing and on other issues in the area of
public finance.
(q) Advisory Board. The Board may appoint an advisory board (the "Advisory
Board") for FLSTAR. The Advisory Board may consist of any number of Persons designated by
the Board and may include members of the Board. All members of the Advisory Board shall be
either (i) a representative of a Participant, or (ii) a person who has no business relationship with
the Board (unless the requirements of Section 112.313(3) and (7), Florida Statutes, have been
waived by the Board pursuant to Section 112.313(12),Florida Statutes), and is qualified to advise
the Board.The Advisory Board shall have such duties as may be set forth by the Board.The Board
shall fix the terms of (and may remove) members of the Advisory Board. All meetings of the
Advisory Board are subject to and must comply with Section 286.011, Florida Statutes.
SECTION 3.03. TRUSTEES.
(a) Initial Board.
(i) The Initial Interlocal Members have by this Agreement appointed the
following persons as the initial trustees(the"Initial Trustees")having terms ending on the
following dates, and such Initial Trustees shall constitute the initial Board:
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Rebecca Roberts September 30, 2020
Tavia Conner September 30,2021
[VACANT] September 30,2022
(ii) No later than one year from the date hereof,the vacancy for the third Initial
Trustee shall be filled by a majority vote of the other Initial Trustees from nominations
provided by the Co-Administrators from Participants other than the Initial Interlocal
Members.
(b) Number and Oualification. The number of Trustees which shall constitute the
Board shall be no less than three (3). The Trustees shall be officers or employees of the
Participants.The Board may expand the number of Trustees appointed to the Board and set initial
terms for each such additional Trustee;provided,however, the number of Trustees appointed to
the Board shall not be less than three (3)nor more than fifteen (15).
(c) Terms.
(i) Following the initial term of each Initial Trustee set forth in subsection(a),
the succeeding terms of office shall commence on the October 1 following the termination
of the prior term and conclude on September 30 of the third year thereafter. If additional
Trustees are appointed to the Board,the term of such Trustees shall be staggered such that
the term of an approximately equal number of Trustees shall expire in any year.
(ii) A Trustee shall remain a member of the Board and serve subsequent terms
until a vacancy occurs in his or her office as provided in Section 3.03(e)of this Agreement,
or until his or her successor is duly elected pursuant to Section 3.03(d) of this Agreement.
(iii) Any vacancy occurring in the Board between terms may be filled by a
majority of the remaining Trustees,even if they constitute less than a quorum of the Board
from nominations provided by the Co-Administrators.
(iv) Any vacancy occurring in the Board shall not operate to annul FLSTAR or
the Board or to revoke any existing agency created pursuant to the terms of this
Agreement.
(d) Participant Election. Not less than 60 days prior to the expiration of the term of a
Trustee, the Participants may nominate one or more candidates for the office by written
instrument delivered to the Board. If the Board receives one or more nominations signed by the
Participants owning at least 25% of the Units in FLSTAR as of the 30th day preceding the
commencement of a new term of office (the'Record Date"),the Board shall promptly conduct an
election for a replacement Trustee by written ballots mailed to the Participants. The ballots shall
include the names of the incumbent Trustee (if he or she desires to be considered), any other
nominees of the Board and the candidates nominated by the Participants owning at least 25% of
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the Units in FLSTAR as of the Record Date. The candidate receiving the most votes on ballots
completed, signed, and returned by the Participants within 30 days after the ballots are mailed,
weighted by the Units owned by such Participants as of the Record Date, shall be elected to the
position of Trustee for the upcoming term.
(e) Vacancies. A Trustee's office and his or her position on the Board shall be deemed
vacant upon the occurrence of any one of the following events:
(i) The Trustee resigns by a written instrument signed by him or her and
delivered to the President. Such resignation shall be effective upon such delivery or at a
later date according to the terms of the notice.
(ii) The Trustee becomes disabled or dies during his or her term.
(iii) The Trustee ceases to be an elected or appointed official or employee of the
Participant he or she served at the time of appointment or such Participant withdraws
from participation in FLSTAR.
(iv) The Trustee is convicted of a felony or is the subject of an Order for Relief
entered pursuant to the United Bankruptcy Code.
(v) A court of competent jurisdiction voids the appointment or removes the
Trustee for any cause whatsoever,but only after his or her right to appeal has been waived
or otherwise exhausted.
(vi) The Trustee is removed for good cause by a two-thirds vote of the Board.
(f) Officers. The officers of the Board shall consist of a president, one or more vice
presidents, a secretary, one or more assistant secretaries, and an investment officer or officers.
Officers of the Board shall be elected by the Board.Two or more offices may be held by the same
person,except the offices of present and secretary.
(i) President.The president shall preside at all meetings of the Board and shall
have such other powers and duties as may from time to time be prescribed by the Board.
(ii) Vice President. During the absence or disability of the president, the vice
presidents in the order of their seniority,unless otherwise determined by the Board,shall
perform the duties and may exercise the powers of the president.The vice presidents shall
also perform such other duties and have such other authority and powers as the Board
may from time to time prescribe.
(iii) Secretary. The secretary shall attend all meetings of the Board, record (or
cause to be recorded) all of the proceedings of the meetings in a minute book to be kept
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for that purpose,and perform like duties for the standing committees when required.The
secretary shall give, or cause to be given, notice of all meetings of the Board and shall
perform such other duties and have such other powers as may be prescribed by the Board
or, consistent with this Agreement, the president.The secretary shall keep in safe custody
the seal of the Board, if any, and, when authorized by the Board, shall affix the same to
any instrument requiring it and, when so affixed, attest the same by his or her signature.
(iv) Assistant Secretaries. During the absence or disability of the secretary, the
assistant secretaries in the order of their seniority, unless otherwise determined by the
Board, shall perform the duties and may exercise the powers of the secretary. They shall
also perform such other duties and have such other powers as the Board may from time
to time prescribe.
(v) Investment Officer. The investment officer shall perform such duties and
have such powers as the Board may from time to time prescribe or as may otherwise be
established by applicable law.
(g) Meetings. All meetings of the Board are subject to and must comply with Section
286.011, Florida Statutes.
(i) Regular Meetings. Regular meetings of the Board may be held at such time
and at such place as shall from time to time be determined by the Board, subject to
applicable law. The Board shall meet at least once annually within 180 days after
completion of each fiscal year of FLSTAR. At such meeting, the Board shall, among other
things, appoint the Trustees, elect officers, and set the calendar for regular meetings and
other organizational matters.
(ii) Special Meetings. Special meetings of the Board may be called by the
president and shall be called by the secretary on the written request of two Trustees.Either
the president or the secretary may call an emergency meeting of the Board in a situation
which meets the requirements of the Section 286.011,Florida Statutes.
(iii) Location.Meetings of the Board, regular or special, shall be held within the
State. To the extent permitted by Section 286.011, Florida Statutes, telephonic regular or
special meetings by conference call or other method of electronic voice transmission
which permits each participant to hear every other participant and join in the discussion
are specifically authorized.
(iv) Quorum. A quorum of the Board exists when a majority of the Trustees is
present and may be made of Trustees who are voting or abstaining from voting. As long
as a quorum is present, the act of a majority of the Trustees voting shall be the act of the
Board,unless a supermajority is required by this Agreement or by law.
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(v) Public Notice.Section 286.011(1),Florida Statutes,requires that the Board or
Advisory Board provide reasonable notice to the general public of all meetings. Notices
to any meetings of the Board or the Advisory Board shall: (1) contain the time and place
of the meeting and, if available, an agenda,or if no agenda is available, a statement of the
general subject matter to be considered; (2) be prominently displayed in the area in
FLSTAR's offices set aside for that purpose and on FLSTAR's website, if any; (3) be
provided at least seven days prior to a regular meeting;(4)be provided at least three days
prior to a special meeting; and (5) in the case of an emergency meeting,be provided in a
manner that is appropriate and effective under the circumstances.
(vi) Trustee Notice.The notice described in Section 3.03(h)(v)of this Agreement
shall be delivered personally, or mailed by United States mail postage prepaid, express
delivery service, or electronic transmission to the Trustees at their respective addresses
provided to HTS. Attendance of a Trustee at any meeting shall constitute a waiver of the
notice required by this Section 3.03(h)(vi),except where the Trustee attends for the express
purpose of objecting to the transaction of any business on the ground that the meeting is
not lawfully called or convened.
(vii) Expenses. The Trustees shall receive no compensation, but shall be paid
their reasonable expenses,if any,of attendance at each meeting of the Board in accordance
with the law. Per diems and expenses paid to any Trustee by a Participant for such
Trustee's service on the Board shall be considered an expense of the Board and shall be
paid from the Trust Asset's earnings upon proper invoice.
(h) Limitation on Liability.
(i) The Trustees and officers of the Board that are officers or employees of the
Participants are governmental officials and shall enjoy all of the privileges and immunities
from liability; exemptions from laws, ordinances, and rules; and pensions and relief,
disability, workers' compensation, and other benefits which apply to the activity of
officers, agents, or employees of any Participant when performing their respective
functions within the territorial limits for their respective agencies to the same degree and
extent to the performance of such functions and duties of such officers, agents, or
employees under the provisions of this Agreement.
(ii) If the Trustees and officers of the Board have acted in good faith under the
belief that their actions are in the best interest of FLSTAR, such Trustees and officers of
the Board shall not be responsible for or liable in any event for neglect or wrongdoing by
them or any officer, agent, employee, or investment advisor of FLSTAR, but nothing
contained herein shall protect any Trustee or officer against any liability to which he or
she would otherwise be subject by reason of fraud,willful misfeasance, or bad faith.
93931518.2
14
(iii) Each Trustee and officer of the Board shall,in the performance of his or her
duties,be fully and completely justified and protected with regard to any act or any failure
to act resulting from reliance in good faith upon the books of account or other official
records of FLSTAR,upon an opinion of counsel,or upon official reports made to FLSTAR
by any of its officers or employees or by JPMIM, HTS, the Custodian, accountants,
appraisers, or other experts or consultants selected with reasonable care by the Board or
the officers of the Board.
(iv) To the fullest extent permitted by law, any obligation of FLSTAR shall be
payable solely from the Trust Assets held by FLSTAR in any one or more Portfolios by
FLSTAR, and none of the Participants, whether past, present, or future, shall be liable
therefor.
(v) Article X, Section 13 of the Florida Constitution and the laws of the State
provide sovereign immunity to certain Participants. Nothing contained in this
Agreement, whether by action or provisions hereof, shall constitute a waiver by a
Participant of any of the benefits of sovereign immunity.The participation of a Participant
(or any Participant's officer, employee, agent, or representative) on the Board or in any
action, determination, or vote under this Agreement, shall not affect a waiver of any of
the benefits of sovereign immunity.
(i) Conflicts of Interest.
(i) No Trustee shall vote upon any measure which would inure to his or her
special private gain or loss (as such phrase is defined in Section 112.3143(1)(d), Florida
Statutes); which he or she knows would inure to the special private gain or loss of any
principal by whom he or she is retained or to the parent organization or subsidiary of a
corporate principal by which he or she is retained, other than an agency (as such term is
defined in Section 112.312(2), Florida Statutes);or which he or she knows would inure to
the special private gain or loss of a relative or business associate of the Trustee. Such
Trustee shall, prior to the vote being taken, publicly state to the Board the nature of the
Trustee's interest in the matter from which he or she is abstaining from voting and,within
15 days after the vote occurs, disclose the nature of his or her interest as a public record in
a memorandum filed with the Secretary of the Board for recording the minutes of the
meeting,who shall incorporate the memorandum in the minutes.
(ii) No Trustee shall participate (as such term is defined in Section
112.312(4)(c), Florida Statutes) in any matter which would inure to the Trustee's special
private gain or loss; which the Trustee knows would inure to the special private gain or
loss of any principal by whom he or she is retained or to the parent organization or
subsidiary of a corporate principal by which he or she is retained; or which he or she
knows would inure to the special private gain or loss of a relative or business associate of
93931518.2
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the Trustee, without first disclosing the nature of his or her interest in the matter in
accordance with Section 112.312(4), Florida Statutes.
(j) Code of Ethics. The Trustees are public officers (as such term is defined in Section
112.313(1), Florida Statutes) subject to the standards of conduct set forth in Section 112.313,
Florida Statutes.
(k) Standard of Care.The Trustees shall use ordinary care and reasonable diligence in
the administration of FLSTAR. Nothing contained in this Agreement, either expressly or by
implication, shall be deemed to impose any duties or responsibilities on the Trustees other than
those expressly set forth in this Agreement.
SECTION 3.04. NO LIABILITY.
(a) Neither the Board, the Trustees, nor any officers, employees, nor board members
of any of the forgoing shall be held liable for any action or omission to act on behalf of FLSTAR
or the Participants unless caused by such person's fraud, willful misfeasance, or bad faith. As
described in Section 3.05 of this Agreement, FLSTAR shall indemnify and hold harmless (either
directly or through insurance) any Person referred to in this Section 3.04(a), to the extent
permitted by law,for any and all litigation,claims,or other proceedings,including but not limited
to reasonable attorney fees, costs, judgments, settlement payments, and penalties arising out of
the management and operation of FLSTAR, unless the litigation, claim, or other proceeding
resulted from the fraud,willful misfeasance, or bad faith of such Person.
(b) Neither the Co-Administrators, the Custodian, nor their affiliates, officers,
employees, or board members shall be held liable for any action or omission to act on behalf of
FLSTAR or the Participants unless such person failed to meet the standard of care required under
its agreement relating to FLSTAR or acted with willful misconduct. As described in Section 3.05
of this Agreement, FLSTAR shall indemnify and hold harmless (either directly or through
insurance) any Person referred to in this Section 3.04(b), to the extent permitted by law, for any
and all litigation, claims, or other proceedings, including but not limited to reasonable attorney
fees, costs, judgments, settlement payments, and penalties arising out of the management and
operation of FLSTAR, unless the litigation, claim, or other proceeding is adjudicated to have
resulted from such Person's failure to meet the standard of care required under its agreement
relating to FLSTAR or its willful misconduct.
(c) To the fullest extent permitted by law, any obligation of FLSTAR shall be payable
solely from the Trust Assets held by FLSTAR in any one or more Portfolios, as determined by the
Board, and none of the Participants, whether past, present, or future, shall be liable therefor. All
Persons shall look solely to such Trust Assets for satisfaction of claims of any nature arising in
connection with the affairs of FLSTAR. No member or officer of the Board who is made a party
to any suit or proceeding to enforce any such liability shall on account thereof be held to any
personal liability.
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SECTION 3.05. INDEMNIFICATION.
(a) Definitions. As used in this Section 3.05, the words "claim," "action," "suit," and
"proceeding" shall apply to all claims, actions, suits, or proceedings (civil, criminal, or other,
including appeals), actual or threatened, while in office or thereafter, and the words "liability"
and "expenses" shall include, without limitation, attorneys' fees, costs,judgments, amounts paid
in settlement, fines, penalties, and other liabilities.
(b) Indemnification. Subject to the exceptions and limitations contained in Section
3.05(c) of this Agreement, every person who is, or has been, a Trustee or officer of the Board
(hereinafter referred to as a "Covered Person"), whether or not the Covered Person has been
alleged to have been negligent in the exercise of the duties of his or her office,shall be indemnified
to the fullest extent permitted by law against liability and against all expenses reasonably
incurred or paid by the Covered Person in connection with any claim, action, suit, or proceeding
in which he or she becomes involved as a party or otherwise by virtue of being or having been a
Trustee or officer and against amounts paid or incurred by the Covered Person in the settlement
thereof.
(c) Limitations. No indemnification shall be provided hereunder to a Covered Person
(i) who shall have been adjudicated by a court or body before which the proceeding was brought
to be liable to the Board, FLSTAR, or the Participants by reason of fraud, willful misfeasance, or
bad faith; or (ii) in the event of a settlement, unless there has been a determination that the
Covered Person did not engage in fraud,willful misfeasance, or bad faith, (1)by a court or other
body approving the settlement, (2)by at least a majority of the Trustees who are not parties to the
matter,based upon review of readily available facts (as opposed to full trial-type inquiry), or(3)
by written opinion of independent legal counsel based upon a review of readily available facts
(as opposed to a full trial-type inquiry).
(d) Miscellaneous. The rights of indemnification herein provided may be insured
against by policies maintained by the Board, shall be severable, shall not be exclusive of or affect
any other rights to which any Covered Person may now or hereafter be entitled,shall continue as
to a Covered Person who has ceased to be a Trustee or officer, and shall inure to the benefit of the
heirs,executors, and administrators of the Covered Person. Nothing contained herein shall affect
any rights to indemnification to which FLSTAR personnel, other than Trustees and officers, and
other Persons may be entitled by contract or otherwise under law.
(e) Expenses of Defense. Expenses in connection with the preparation and
presentation of a defense to any claim, action, suit, or proceeding of the character described in
Section 3.05(b)of this Agreement may be paid as an expense of the applicable Portfolio from time
to time prior to final disposition thereof upon receipt of an undertaking by or on behalf of the
Covered Person that such amount will be paid over by him or her to the applicable Portfolio if it
is ultimately determined that he is not entitled to indemnification under this Section 3.05;
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provided, however, that either (i) the Covered Person shall have provided appropriate security
for such undertaking, (ii) the Board is insured against losses arising out of any such advance
payments, or (iii) either a majority of the Trustees who are not parties to the matter, or
independent legal counsel in a written opinion, shall have determined, based upon a review of
readily available facts(as opposed to a trial-type inquiry or full investigation),that there is reason
to believe that the Covered Person will be found entitled to indemnification under this Section
3.05.
(f) Right to Defend. Subject to applicable law, the Board may, and if requested in
writing by a Covered Person shall, undertake the defense of any claim, action, or proceeding in
connection with the matters set forth in Section 3.05(b)-(e) for which the Covered Person is
indemnified under this Section 3.05, and thereafter the Board shall not be liable to the Covered
Person for any costs of counsel or other expenses other than reasonable costs subsequently
incurred by the Covered Person at the request of the Board in connection with the defense thereof,
unless (i) the employment of such counsel has been specifically authorized in writing by the
Board, (ii) the Board has failed after request to assume the defense and to employ counsel,or(iii)
the named parties to any such action (including impleaded parties) include both a Covered
Person and the Board and the Covered Person shall have been advised by counsel that there may
be one or more legal defenses available to it which are different from or additional to those
available to the Board (in which case, if the Covered Person notifies the Board in writing that it
elects to employ separate counsel at the expense of the Board, the Board shall not have the right
to assume the defense of the action on behalf of the Covered Person; provided that if the Board
has insured against losses pursuant to Section 3.05(e) and the insurer proceeds to defend the
Covered Person pursuant to the policy of insurance,then the Board shall have no further duty to
indemnify costs of defense or defend the Covered Person pursuant to this Section 3.05.
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ARTICLE IV
PARTICIPATION IN TRUST
SECTION 4.01. ELIGIBILITY OF INTERLOCAL MEMBERS.In order for a Public
Agency to become an Interlocal Member and transfer Surplus Funds into FLSTAR, each of the
following conditions must be satisfied:
(a) The Public Agency must enact an ordinance or adopt a resolution substantially in
the form attached hereto as Appendix B to this Agreement. Such ordinance or resolution shall(i)
authorize the Public Agency to become party to and approve this Agreement as an Interlocal
Member, (ii) acknowledge the Board's power to supervise FLSTAR and agree that the Surplus
Funds it transfers to FLSTAR shall be held and managed in trust by the Board for the Interlocal
Member's benefit, (iii) designate Authorized Representatives of the Interlocal Member, and (iv)
consent to the terms and conditions specified on FLSTAR's website in order to use the online
transaction system;
(b) The Public Agency must become a party to this Agreement by executing an
Additional Party Agreement and delivering the same to FLSTAR, together with a certified copy
of the ordinance or resolution referred to in Section 4.01(a) of this Agreement, an application in
form and substance satisfactory to the Board, a copy of its written investment policy, and such
other information as may be required by the Board; and
(c) No entity except a Public Agency may be an Interlocal Member. The Board shall
have the sole discretion to determine whether a Public Agency is eligible under law to be an
Interlocal Member and to designate categories of Public Agencies eligible to be Interlocal
Members in any Portfolio of FLSTAR.
SECTION 4.02. ELIGIBILITY OF INVESTORS. In order for a Unit of Local
Government or a Public Agency to become an Investor and transfer Surplus Funds into FLSTAR
without becoming an Interlocal Member, each of the following conditions must be satisfied:
(a) The Unit of Local Government or Public Agency (i) must have adopted by
resolution a written investment policy (or have amended an existing written investment policy)
pursuant to Section 218.415, Florida Statutes, or other Florida law that is consistent with this
Agreement and that authorizes investment of Surplus Funds in intergovernmental investment
pool(s), or (ii) provide the Board with other satisfactory information establishing its authority to
invest its Surplus Funds in the applicable Portfolio of FLSTAR pursuant to Florida law;and
(b) The Unit of Local Government or Public Agency must execute a Participation
Certificate substantially in the form attached hereto as Appendix C to this Agreement and deliver
the same to FLSTAR, together with a copy of the written investment policy referred to in Section
4.02(a)(i) of this Agreement or other satisfactory information referred to in Section 4.02(a)(ii) of
this Agreement, an application in form and substance satisfactory to the Board, and such other
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information as may be required by the Board. Such Participation Certificate shall (i) certify that
the Investor is authorized to invest its Surplus Funds in FLSTAR pursuant to either Section
218.415, Florida Statutes, or other Florida law (ii) acknowledge the Board's power to supervise
FLSTAR and agree that the Surplus Funds it transfers to FLSTAR shall be held and managed in
trust by the Board for the Investor's benefit, (iii) designate Authorized Representatives of the
Investor, and (iv) consent to the terms and conditions specified on FLSTAR's website in order to
use the online transaction system.
(c) No entity except a Unit of Local Government or Public Agency may be an Investor.
The Board shall have the sole discretion to determine whether a Unit of Local Government or
Public Agency is eligible under law to be an Investor and to designate categories of Units of Local
Government or Public Agencies eligible to be Investors in any Portfolia or FLSTAR.
SECTION 4.03. REPRESENTATIONS AND WARRANTIES. Each Interlocal
Member hereby represents and warrants, and each Participant shall represent and warrant, that:
(a) the Participant has taken all necessary actions and has received all necessary
approvals and consents and adopted all necessary ordinances and resolutions in order to perform
its obligations hereunder, including, without limitation, the appointment of its Authorized
Representative (and, with respect to a Participant that is an Interlocal Member, to execute and
deliver this Agreement or its Additional Party Agreement, as applicable), and;
(b) the performance of this Agreement by the Participant (and, with respect to a
Participant that is an Interlocal Member,the execution and delivery of this Agreement),are within
the power and authority of the Participant and do not violate the laws,rules,or regulations of the
State applicable to the Participant or the Participant's charter or its organizational statute,
instrument, or documents or any other applicable federal, State, or local law;and
(c) the resolution, ordinance, and/or certificates delivered heretofore or hereafter by
the Participant pursuant to this Agreement, as of the date specified therein,are true and complete
and contain no material misstatements of fact or omissions that render them misleading; and
(d) it is considered a political subdivision of a state for federal income tax purposes
whose income is exempt from federal income taxation.
SECTION 4.04. COVENANTS. Each Participant hereby covenants that:
(a) it shall invest only the Surplus Funds that are permitted to be invested by it
pursuant to the laws of the State and any charter, instrument, organizational document, and any
federal,State,or local rule,ordinance,resolution,or regulation applicable to such Participant,and
that it will perform all actions required by the laws of the State and any charter, instrument, or
organizational document,and any federal,state,or local rule,ordinance, resolution,or regulation
applicable to such Participant to be done prior to such investment;
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(b) it shall use reasonable efforts to withdraw from this Agreement or withdraw its
Surplus Funds held in any Portfolio of FLSTAR prior to the time any of the representations and
warranties made by it in Section 4.02 of this Agreement ceases to be true;and
(c) it represents and warrants that it is considered a political subdivision of a state for
federal income tax purposes whose income is exempt from federal income taxation.
SECTION 4.05. PARTICIPANT ACCOUNTS.
(a) In order to accomplish FLSTAR's purpose,each Participant agrees that the Surplus
Funds transferred to a Portfolio within FLSTAR will be commingled with other Surplus Funds
transferred to the Portfolio by other Participants for the purpose of making Authorized
Investments, subject to the terms of this Agreement, the Investment Policies, and applicable law,
thereby taking advantage of investment opportunities and cost benefits available to larger
investors.
(b) While available Surplus Funds of the Participants may be commingled for
purposes of common investment and operational efficiency, one or more separate Accounts for
each Participant in each Portfolio in FLSTAR designated by the Participant will be established in
accordance with the Participant's application to join FLSTAR and will be maintained by FLSTAR.
(c) Each Participant shall own an undivided beneficial interest in the Trust Assets in
the Portfolios in which it invests represented by Units, as further described in the Investment
Policies and Operating Policies.
(d) The Participant agrees that all FLSTAR fees payable by a Participant shall be
directly and automatically assessed and charged against the Participant's Account. The basic
services fee shall be calculated as a reduction in the daily income earned and only the net income
shall be credited to the Participant's Account. Fees for special services shall be charged to each
Participant's Account as they are incurred or performed. Use of the Trust Assets for fees shall be
made from current revenues available to the Participant.
SECTION 4.06. REPORTS. FLSTAR shall submit a written report a least once per
month to each Participant. Such report will indicate: (a) the balance in each Account of a
Participant as of the date of such report, (b) yield information, and (c) all account activity since
the previous report.
SECTION 4.07. PARTICIPANT TERMINATION.
(a) A Participant may withdraw all Surplus Funds from an Account in accordance
with the Investment Policies and Operating Procedures. A Participant may cease to be a
93931518.2
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Participant under this Agreement,with or without cause,by providing written notice to FLSTAR
at least 10 days prior to such termination.
(b) The Board may terminate a Participant's participation in this Agreement upon at
least 30 days' notice if the applicable federal, state, or local law, rule, ordinance, resolution, or
regulation changes so that such Participant is no longer entitled to join in an eligible
intergovernmental investment pool under Section 218.415, Florida Statutes, the Interlocal Act, or
other applicable law.
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ARTICLE V
THE CO-ADMINISTRATORS
SECTION 5.01. PROFESSIONAL MANAGEMENT. Pursuant to its powers under
Section 3.06 of this Agreement, the Board shall appoint co-administrators to provide services to
FLSTAR consisting of one or more investment advisors registered under the Investment Advisors
Act of 1940 with distribution of FLSTAR through a broker-dealer registered under the Securities
Exchange Act of 1934.The Initial Trustees have by this Agreement appointed HTS and JPMIM to
serve as Co-Administrators. The Board will take such actions (including, without limitation,
negotiation of the Co-Administration Agreement) and will execute and deliver the Co-
Administration Agreement and any other agreements, certificates, instruments, and documents
as shall be necessary or desirable to appoint HTS and JPMIM.
SECTION 5.02. THE CO-ADMINISTRATORS. Pursuant to the initial Co-
Administration Agreement, JPMIM shall provide investment advice to FLSTAR and HTS shall
provide distribution, Participant, and marketing services to FLSTAR. Pursuant to its overall
investment management responsibilities, JPMIM will appoint JPMorgan Chase Bank, N.A. to
provide certain custodian and accounting services to FLSTAR. The Co-Administrators shall
jointly provide transfer agency services through contracting with DST Asset Manager Solutions,
Inc., or such other contractor they may select.
SECTION 5.03. SUBCONTRACTS. Each Co-Administrator may subcontract with
its affiliates and others to perform the functions described in the Co-Administration Agreement
and such subcontractors may subcontract with their respective affiliates and others to perform
the functions assigned to them. To the extent that a Co-Administrator subcontracts all or a part
of its responsibilities under the Co-Administration Agreement, the Co-Administrator will be
responsible for compliance with the terms of the Co-Administration Agreement to the same
extent as if such Co-Administrator itself had acted or failed to act instead of the subcontractor.
SECTION 5.04. BOARD POLICIES. The Board is responsible for the Investment
Policies, the Operating Policies, and the general investment program of FLSTAR and for the
general supervision and administration of the business and affairs of FLSTAR. The Co-
Administrators have agreed to perform their duties under the Co-Administration Agreement in
a manner which is consistent with such Investment Policies and the Operating Policies.
SECTION 5.05. INTELLECTUAL PROPERTY. The parties acknowledge that
pursuant to the Co-Administration Agreement, the Co-Administrators may develop various
types of intellectual property (the "Intellectual Property"), including, but not limited to,
trademarks and copyrights. With regard to any and all Intellectual Property created by the Co-
Administrators for use in FLSTAR, the Co-Administrators shall have all right, title, and interest
to the Intellectual Property. No Participant shall make any claim of ownership to the Intellectual
Property and shall have no rights to the Intellectual Property.
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SECTION 5.06. SUCCESSOR CO-ADMINISTRATORS.
(a) Each Co-Administrator may assign its rights and duties under the Co-
Administration Agreement in whole, or in part, to an affiliate; provided, however, if such
assignment is considered an "assignment" under the Investment Advisors Act of 1940, then the
prior written consent of the other parties to the Co-Administration Agreement, including
FLSTAR, is required.
(b) The Co-Administrators or either of them may resign pursuant to the terms of the
Co-Administration Agreement.
(c) The Board may, upon a unanimous vote of the Board, terminate one or both Co-
Administrators pursuant to the terms of the Co-Administration Agreement;provided, however,
the Board's action shall not become effective until it is approved by the Participants holding at
least 75%of the Units in FLSTAR.
(d) Successor Co-Administrators shall meet the requirements set forth in Section 5.01
of this Agreement and their appointment by the Board shall be ratified by the Participants holding
at least 75%of the Units in FLSTAR.
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93931518 2
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ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. AMENDMENT.
(a) Unless explicitly set forth otherwise herein, this Agreement may be amended by a
majority of the Board. Any amendment that impacts the duties, obligations, or rights of the Co-
Administrators shall be reduced to writing and agreed to by the affected party.
(b) This Agreement may not be amended to (i) change the purpose of FLSTAR or
powers granted to the Board as set forth and established herein by the Interlocal Members,unless
such amendment has been approved by the Interlocal Members; (ii) permit the diversion or
application of any Trust Assets for any purpose other than those specified herein;(iii)change any
rights with respect to any Units by reducing the amount payable thereon upon liquidation of
FLSTAR; or (iv) impair the exemptions contained herein from personal liability of the
Participants, the Trustees, officers, employees, and agents of FLSTAR.
(c) Any amendment executed pursuant to Section 6.01(a) hereof will be effective 30
days after notice is mailed or otherwise delivered, including but not limited to delivery by
electronic means,to all existing Participants and the Co-Administrator,if applicable,setting forth
the substance of such amendment and permitting each Participant to terminate its participation
and request payment of its balance on the terms set out in the Operating Procedures.
(d) Notwithstanding the foregoing, subject to the terms of this Agreement, the Board
has the authority to amend any term or provision of the Bylaws, provided that notice is sent to
each Participant at least 30 days prior to the effective date of any change which,in the opinion of
the Board, is a material change to the Bylaws.
(e) Notwithstanding the foregoing, subject to the terms of this Agreement, the Board
has the authority to amend any term or provision of the Investment Policies,provided that notice
is sent to each Participant at least 30 days prior to the effective date of any change which, in the
opinion of the Board, will have a material effect on the Participants' investments in FLSTAR.
(f) Notwithstanding the foregoing, subject to the terms of this Agreement, the Board
has the authority to amend any term or provision of the Operating Procedures provided that
notice is sent to each Participant at least 30 days prior to the effective date of any change which,
in the opinion of the Board, will have a material effect on such Participant's investment in
FLSTAR.
(g) Notwithstanding the foregoing, subject to the terms of this Agreement and the
Investment Policies, the Information Statement may be amended or supplemented.
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SECTION 6.02. TERMINATION.
(a) This Agreement shall continue in full force and effect unless terminated as set forth
in this Section 6.02 or unless otherwise terminated by the Interlocal Members pursuant to the
Interlocal Act.
(b) The Board may dissolve FLSTAR in whole and terminate this Agreement upon a
unanimous vote of the Board; provided, however, the Board's action shall not become effective
until ratified by the Participants holding at least 75%of the Units in FLSTAR and the Board shall
have made provision for all liabilities and obligations of the Board and FLSTAR.
(c) The Board may dissolve any Portfolio upon not less than 30 days' notice to the
Participants, provided that the Board makes provision for all liabilities and obligations of such
Portfolio. Upon the termination of any Portfolio, after making provision for all liabilities and
obligation of such Portfolio, the Board shall disburse all of the Trust Assets in such Portfolio to
the Participants in proportion to their Units in such Portfolio. After giving notice of termination
of any Portfolio, the Board may withhold distributions of earnings from such Portfolio in such
amounts as it deems advisable to make provision for the Portfolio's liabilities and obligations.
(d) Upon the dissolution of FLSTAR and termination of this Agreement pursuant to
Section 6.02 of this Agreement:
(i) the Board and its contractors and agents shall carry on no business in
connection with FLSTAR except for the purposes of satisfying the liabilities of FLSTAR
and winding up their affairs in connection with the Trust Assets;
(ii) all of the powers of the Board and the Co-Administrators under this
Agreement and the Co-Administration Agreement, shall continue until the affairs of
FLSTAR shall have been wound up, including, but not limited to, the power to collect
amounts owed, sell, convey, assign,exchange, transfer, or otherwise dispose of all or any
part of the remaining Trust Assets,and do all other acts appropriate to liquidate the affairs
in connection with FLSTAR; and
(iii) after paying or adequately providing for the payment of all liabilities of
FLSTAR, and upon receipt of such releases, indemnities, and refunding agreements as
each of the Board and the Co-Administrators deem necessary for their protection, the
Board shall disburse all of the Trust Assets of FLSTAR to the Participants in proportion to
their Units in FLSTAR. After giving notice of dissolution of FLSTAR, the Board may
withhold distributions of earnings from FLSTAR in such amounts as it deems advisable
to make provision for FLSTAR's liabilities and obligations.
(e) Upon termination of this Agreement and distribution to the Participants as herein
provided, the Board shall direct the Co-Administrators to execute and log among the records
93931518 2
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maintained in connection with this Agreement an instrument in writing setting forth the fact of
such termination, and the Board and the Participants shall thereupon be discharged from all
further liabilities and duties hereunder, and the rights and benefits of all the Participants
hereunder shall cease and be cancelled and discharged.
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93931518.2
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ARTICLE VII
MISCELLANEOUS
SECTION 7.01. SEVERABILITY.
(a) If any provision of this Agreement shall be held or deemed to be illegal,
inoperative, or unenforceable, the same shall not affect any other provisions contained herein or
render the same invalid,inoperative, or unenforceable to any extent whatsoever.
(b) Any participation in this Agreement or transfer of assets to FLSTAR that is not
qualified for any reason shall not terminate this Agreement or the participation of other
Participants or otherwise adversely affect FLSTAR.
SECTION 7.02. LIMITATION OF RIGHTS. This Agreement does not create any
right, title, or interest for any Person other than the Participants and any Person who has a
contract to provide services to FLSTAR, and nothing in or to be implied from this Agreement is
intended or shall be construed to give any other Person any legal or equitable right, remedy, or
claim under this Agreement.
SECTION 7.03. EXECUTION OF COUNTERPARTS. This Agreement may be
executed in several separate counterparts, including by Additional Party Agreement, each of
which shall be an original and all of which shall constitute one and the same instrument.
SECTION 7.04. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State.
SECTION 7.05. EFFECTIVE DATE. Pursuant to section 163.01(11), Florida
Statutes, this Agreement shall become effective upon filing with the Clerk of the Circuit Court in
the county where the Board maintains its chief administrative office as set forth in Section 3.01(d)
of this Agreement(the "Effective Date").
SECTION 7.06. TERM. This Agreement shall have an initial term beginning with
the Effective Date and shall be automatically renewed for one year on such date and each
anniversary of such date, except with respect to any Public Agency or Unit of Local Government
that may have terminated itself as a Participant or as otherwise provided in Section 4.07 of this
Agreement.
SECTION 7.07. NOTICES. Any notices or other information required or permitted
to be given hereunder shall be sent by written notice delivered by electronic mail: (a)to FLSTAR
at the address set forth in the Information Statement, and (b)to a Participant at the email address
of the Authorized Representatives as set forth in the Participant's application to become a
Participant or as otherwise provided by written notice to HTS.
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SECTION 7.08. PARTICIPANT RIGHTS.The Participants shall be beneficiaries in
FLSTAR, and their relationship to the Board shall be solely in their capacity as Participants in
accordance with the rights conferred upon them hereunder.
SECTION 7.09. ENTIRE AGREEMENT. This Agreement represents the entire
agreement and understanding of the Participants.
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93931518 2
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IN WITNESS WHEREOF, the parties have cause this Agreement to be executed in their
names and on their behalf as of the date first written above.
APPROVED:
ATTEST: CITY OF OCOEE, FLORIDA
Melanie Sibbitt, City Clerk Rusty Johnson, Mayor
DATE:
(SEAL)
FOR USE AND RELIANCE ONLY BY APPROVED BY THE OCOEE CITY
THE CITY OF OCOEE, FLORIDA; COMMISSION AT A MEETING HELD
APPROVED AS TO FORM AND , 20
LEGALITY this day of UNDER AGENDA ITEM NO.
, 20 . Resolution No. 2019-012
SHUFFIELD, LOWMAN & WILSON, P.A.
By:
City Attorney
s-i
IN WITNESS WHEREOF, the parties have cause this Agreement to be executed in their
names and on their behalf as of the date first written above.
,FLORIDA
(SEAL)
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
Notice Address:
93931518 2
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APPENDIX A
ADDITIONAL PARTY AGREEMENT
of that certain
AMENDED AND RESTATED INTERLOCAL AGREEMENT AND TRUST INSTRUMENT
for the
FLORIDA SHORT TERM ASSET RESERVE
This Additional Party Agreement (this "Agreement") is executed as of the day of
, 20 , by and on behalf of , Florida (the "Interlocal
Member").
The City of Ocoee, Florida and the City of Haines City, Florida (collectively, the "Initial
Interlocal Members") entered into that certain Interlocal Agreement and Trust Instrument, dated
as of March 21, 2019, as amended and restated by that certain Amended and Restated Interlocal
Agreement and Trust Instrument dated as of , 2019 and as may be further
amended or supplemented from time to time pursuant to its terms (the "Interlocal Agreement"),
in order to establish and maintain an intergovernmental investment pool as described in Section
218.415,Florida Statutes.All capitalized undefined terms used herein shall have the meanings set
forth in the Interlocal Agreement.
The Initial Interlocal Members through due execution and delivery of the Interlocal
Agreement have thereby created the Florida Short Term Asset Reserve ("FLSTAR"), an
intergovernmental investment pool as described in Section 218.415, Florida Statutes, which is
managed, operated, and supervised the Board, a separate legal entity and public body corporate
and politic pursuant to Section 163.01(7), Florida Statutes.
The Interlocal Member hereby represents and warrants that (a) prior to the Interlocal
Member's execution of this Agreement, the Interlocal Member has received and reviewed the
Interlocal Agreement and finds it proper to invest all or a portion of its Surplus Funds in one or
more Portfolios of FLSTAR in accordance with the terms of the Interlocal Agreement; (b) the
Interlocal Member is a Public Agency; (c) the Person executing this Agreement on behalf of the
Interlocal Member is an officer of the Pubic Agency who is properly authorized to invest the
Surplus Funds of the Interlocal Member and execute this Agreement; (d) the Interlocal Member
(i) has taken all required official action to adopt and authorize the execution of the Interlocal
Agreement including, without limitation, adopting or enacting a resolution or ordinance, or
taking any other action necessary to authorize participation and investment in FLSTAR (for
example, adopting written investment policies or amending or modifying any existing written
investment policies to authorize the investment in intergovernmental investment pools), and (ii)
has furnished to the Board evidence satisfactory to FLSTAR that such official action has been
taken; and (e) the Interlocal Member has tendered or has agreed to tender Surplus Funds in the
future for investment under the Interlocal Agreement.
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By executing this Instrument, the Interlocal Member agrees that(a) it will be an Interlocal
Member in FLSTAR and may appoint an officer or employee to serve as a Trustee as described in
the Interlocal Agreement; and(b)it will become a party to the Interlocal Agreement to which this
Agreement is attached, and thereby will be bound by all terms and conditions of the Interlocal
Agreement, as amended from time to time, including without limitation that it will maintain
written investment policies consistent with the provisions of the Interlocal Agreement and which
allows for participation in an intergovernmental investment pool.
IN WITNESS WHEREOF, the undersigned has executed and sealed this Agreement as of
the day first above written.
Name of Unit of Local Government:
OFFICIAL SEAL OF UNIT OF LOCAL By:
GOVERNMENT Authorized Representative
Required Below
Printed Name and Title
Attest:
Authorized Representative
Printed Name and Title
Approved and accepted:
FLORIDA SHORT TERM ASSET RESERVE
By: Hilltop Securities Inc., as Co-Administrator
By: Date:
Authorized Signer
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APPENDIX B
FORM OF [RESOLUTION] [ORDINANCE]
A[N] [RESOLUTION][ORDINANCE] OF THE [GOVERNING
BODY] OF THE [PUBLIC AGENCY] AUTHORIZING THE
EXECUTION AND DELIVERY OF AN INTERLOCAL
AGREEMENT FOR THE PURPOSE OF JOINTLY EXERCISING
ITS POWER TO INVEST SURPLUS FUNDS IN AN
INTERGOVERNMENTAL INVESTMENT POOL PURSUANT
TO SECTION 218.415, FLORIDA STATUTES, AND SECTION
163.01, FLORIDA STATUTES; APPROVING THE
INVESTMENT OF CERTAIN SURPLUS FUNDS OF [PUBLIC
AGENCY] IN THE FLORIDA SHORT TERM ASSET RESERVE;
APPOINTING AN AUTHORIZED REPRESENTATIVE; AND
PROVIDING AN EFFECTIVE DATE.
WHEREAS,Section 218.415, Florida Statutes, authorizes any governmental entity within
the State of Florida (the "State") and not part of State government, including, but not limited to,
counties,municipalities,school districts,special districts,clerks of circuit court,sheriffs,property
appraisers,tax collectors,supervisors of elections,authorities,boards,public corporations,or any
other political subdivision of the State(each a"Unit of Local Government"and,collectively,"Units
of Local Government") to invest and reinvest any surplus funds in their control or possession in
any intergovernmental investment pool authorized pursuant to Section 163.01, Florida Statutes;
and
WHEREAS, Section 163.01, Florida Statutes, permits political subdivisions, agencies, or
officers of the State, including, but not limited to State government, counties, cities, school
districts, single and multipurpose special districts, single and multipurpose public authorities,
metropolitan or consolidated governments, separate legal entities or administrative entities
created under Section 163.01(7), Florida Statutes, or independently elected county officers (each
a "Public Agency" and, collectively, "Public Agencies"), to enter into an interlocal agreement to
jointly exercise any power, privilege, or authority which such Public Agencies share in common
and which each might exercise separately, permitting the Public Agencies to make the most
efficient use of their powers by enabling them to cooperate on a basis of mutual advantage and
thereby provide for the sharing of their powers in a manner and pursuant to forms of
governmental organization that are in the best interests of the Public Agencies; and
WHEREAS,the[Public Agency] is a Public Agency,and is authorized pursuant to Section
218.415 of the Florida Statutes, and its own local laws to invest certain of its surplus funds in
statutorily permitted investments, including, but not limited to, any intergovernmental
investment pool authorized pursuant to Section 163.01, Florida Statutes; and
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WHEREAS, the City of Ocoee,Florida and the City of Haines City,Florida,entered into
that certain Interlocal Agreement, dated as of March 21, 2019, as amended and restated by that
certain Amended and Restated Interlocal Agreement and Trust Instrument dated as of
, 2019, and as may be further amended or supplemented from time to time
pursuant to its terms (the "Interlocal Agreement"), in order to provide the Interlocal Members
(as defined in the Interlocal Agreement), a substantial benefit by establishing the
intergovernmental investment pool to be known as the Florida Short Term Asset Reserve
("FLSTAR"), which is an intergovernmental investment pool as described in Section 218.415,
Florida Statutes, and managed, operated, and supervised by a board of trustees, which is a
separate legal entity and public body corporate and politic pursuant to Section 163.01(7),Florida
Statutes; and
WHEREAS,the [Public Agency] desires to join the Interlocal Agreement and execute and
deliver the Additional Party Agreement, in order to jointly exercise its investment power and
invest its surplus funds in concert with the other Interlocal Members pursuant to the Interlocal
Agreement in order (a) participate in diversified and professionally managed Portfolios (as
defined in the Interlocal Agreement) to meet its investment needs, (b) create greater purchasing
powers through economies of scale, (c) lower the costs associated with the investment and
reinvestment of its surplus funds; and (d)be provided assistance on investment alternatives and
other investment issues of concern; and
WHEREAS, the [Public Agency] further desires to invest and reinvest a portion of its
surplus funds in FLSTAR; and
WHEREAS, the [Public Agency] has adopted written investment policies authorizing
investment in intergovernmental investment pools authorized pursuant to Section 163.01,Florida
Statutes,and with respect to the funds to be invested in such intergovernmental investment pools,
all authorized investments set forth in the investment policies of such intergovernmental
investment pools.
NOW, THEREFORE, BE IT [RESOLVED][ENACTED] by the [Governing Body] of the
[Public Agency] as follows:
SECTION 1. AUTHORITY. This [Resolution][Ordinance] of the [Public Agency] (the
") is adopted pursuant to the provisions of Section 163.01, Florida Statutes (the
"Interlocal Act"), Section 218.415, Florida Statutes (the "Local Government Investment Act"),
[Chapter 166, Part II, Florida Statutes,][Chapter 125, Florida Statutes,] and other applicable
provisions of law (collectively, the "Act").
SECTION 2. INTERLOCAL AGREEMENT.
(a) Pursuant to Article VI of the Interlocal Agreement, the [Public Agency] hereby
approves and joins the Interlocal Agreement, a copy of which is attached hereto as Exhibit A and
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incorporated herein by reference, as an Interlocal Member and agrees to be bound by all of the
terms and provisions thereof.
(b) The [Chairperson][Mayor], as attested by the [County][City] Clerk, or in each case
their duly authorized designee, are hereby authorized and directed to execute and deliver the
Additional Party Agreement,which is in substantially the form attached hereto as Exhibit B with
such changes, amendments, modifications, deletions, and additions as may be approved by the
[Chairperson][Mayor] or his or her duly authorized designee, the execution thereof being
conclusive evidence of such approval.
(c) The Interlocal Agreement constitutes a joint exercise of power, privilege, or
authority by and between the Interlocal Members thereunder and is deemed to be an "interlocal
agreement" within the meaning of the Interlocal Act. The [Public Agency] shall cause this
Resolution and its executed Additional Party Agreement with the Clerk of the Circuit Court in
the County of the [Public Agency] or in the county where FLSTAR maintains its principal place
of business, as provided in section 163.01(11), Florida Statutes.
SECTION 3. INVESTMENT IN FLSTAR; APPOINTMENT OF AUTHORIZED
REPRESENTATIVE; TAX PAYER IDENTIFICATION NUMBER; CONTACT
INFORMATION.
(a) The [Public Agency] is hereby authorized to invest and reinvest a portion of its
surplus funds in one or more Portfolios of FLSTAR. The [Public Agency] hereby acknowledges
the board of trustees' power to supervise FLSTAR and hereby agrees the surplus funds
transferred to FLSTAR shall be held and managed in trust by the board of trustees for the [Public
Agency]'s benefit.
(b) The following officers, officials, or employees of the [Public Agency] are hereby
designated as "Authorized Representatives" within the meaning of the Interlocal Agreement,
with full power and authority to, among other things, execute the Interlocal Agreement, an
application to join FLSTAR, and any other documents required to become an Interlocal Member;
deposit money to and withdraw money from the [Public Agency]'s FLSTAR account from time
to time in accordance with the Interlocal Agreement and the Information Statement; to agree to
the terms for the use of the website for online transactions; and take all other actions deemed
necessary or appropriate for the investment of funds of the [Public Agency]:
1. Name: Title:
Signature: Phone:
Email:
2. Name: Title:
Signature: Phone:
Email:
3. Name: Title:
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Signature: Phone:
Email:
4. Name: Title:
Signature: Phone:
Email:
(c) The name of the Authorized Representative listed above that will be designated as
the primary contact and will receive all FLSTAR correspondence, including transaction
conformations and monthly statements, is:
Name:
(d) The following additional [Public Agency] representative (not listed above) is
designated as an inquiry only representative ("Inquiry Only Representative") authorized to
obtain account information:
Name: Title:
Signature: Phone:
Email:
(e) The [Public Agency] may remove Authorized Representatives, designate other
Authorized Representatives, change Authorized Representatives to Inquiry Only
Representatives, or change Inquiry Only Representatives to additional Authorized
Representatives by written instrument signed by an existing and currently employed or retained
Authorized Representative or by the[Public Agency]'s chief executive officer or his/her designee,
or by the [Public Agency]'s chief financial officer or his/her designee.
(f) The taxpayer identification number for the [Public Agency] is
(g) The contact information for the [Public Agency] is:
Primary mailing address:
Physical address (if different):
Main phone number:
Main fax number:
SECTION 4. DIRECTION AND AUTHORITY. The officials, officers, attorneys, and
other agents or employees of the [Public Agency] are directed and authorized to do all acts and
things required of them by this [Resolution][Ordinance]and the Interlocal Agreement for the full,
punctual, and complete performance of all the terms, covenants, and agreements provided for
herein and therein, and each of the officials, officers, attorneys, or other agents or employees are
93931518.2
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hereby authorized and directed to execute and deliver any and all papers and instruments
(including any agreements required for use of online portals related to FLSTAR) and to do and
cause to be done all acts and things necessary or proper for carrying out the activities and actions
contemplated by this [Resolution][Ordinance] and the Interlocal Agreement.
SECTION 5. INVESTMENT POLICIES. With respect to the surplus funds to be
invested in FLSTAR, to the extent the written investment policies of the [Public Agency] adopted
pursuant to Section 218.415, Florida Statutes (the "Investment Policies"), is inconsistent with the
investment policies of FLSTAR, the [Public Agency] hereby amends the Investment Policies to
include as an authorized investment FLSTAR and all authorized investments set forth in the
investment policies of FLSTAR, as such investment policies may be amended from time to time
in accordance with the Interlocal Agreement.
SECTION 6. EFFECTIVE DATE. This [Resolution][Ordinance] shall take effect
immediately upon its filing with the Clerk of the Circuit Court in the County of the [Public
Agency] or in the county where FLSTAR maintains its principal place of business.
PASSED AND[ADOPTED][ENACTED] at a meeting held on the day of ,
20
[PUBLIC AGENCY]
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
(SEAL)
93931518 2
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APPENDIX C
FORM OF PARTICIPATION CERTIFICATE
This Participation Certificate (this "Certificate") is executed as of the day of
, 20_, by the undersigned authorized signatory on behalf of
, Florida (the "Investor").
The City of Ocoee, Florida and the City of Haines City, Florida (collectively, the "Initial
Interlocal Members") entered into that certain Interlocal Agreement and Trust Instrument, dated
as of March 21, 2019, as amended and restated by that certain Amended and Restated Interlocal
Agreement and Trust Instrument dated as of , 2019 and as may be further
amended or supplemented from time to time pursuant to its terms (the "Interlocal Agreement"),
creating the Florida Short Term Asset Reserve ("FLSTAR"), an intergovernmental investment
pool as described in Section 218.415, Florida Statutes, which is managed, operated, and
supervised by the Board, a separate legal entity and public body corporate and politic pursuant
to Section 163.01(7), Florida Statutes. All capitalized undefined terms used herein shall have the
meanings set forth in the Interlocal Agreement.
By executing this Certificate the undersigned authorized signatory hereby represents and
warrants on behalf of the Investor that (a) representatives of the Investor have received and
reviewed the Information Statement and Interlocal Agreement;(b) the Investor finds it proper to
invest all or a portion of its Surplus Funds in one or more Portfolios of FLSTAR in accordance
with the terms of the Interlocal Agreement; (c) the Investor is a Unit of Local Government or
Public Agency under State law whose income is exempt from federal income taxation; (d) the
Person executing this Certificate on behalf of the Investor is an officer of the Investor empowered
to invest Surplus Funds of the Investor and execute this Certificate and any other documents
necessary to establish an account with FLSTAR and invest Surplus Funds therein; and (e) the
Investor(i)has taken all required official action to invest Surplus Funds in one or more Portfolios
of FLSTAR pursuant to Section 218.415, Florida Statutes, or other Florida law, and (ii) has
furnished to the Board evidence satisfactory to the Board that such official action has been taken.
By executing this Certificate, the authorized signatory represents and warrants that the
Investor will be bound by all terms and conditions of the Interlocal Agreement,as amended from
time to time, including without limitation the requirement that it will maintain eligibility to
invest its Surplus Funds in FLSTAR pursuant to Section 218.415,Florida Statutes,or other Florida
law.
The following officers, officials, or employees of the Investor are designated as
"Authorized Representatives" within the meaning of the Interlocal Agreement, with full power
and authority to, among other things, execute an application to become an Investor in FLSTAR
and any other documents required to become an Investor;deposit money to and withdraw money
from the Investor's FLSTAR account from time to time in accordance with the Interlocal
93931518.2
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Agreement and the Information Statement; to agree to the terms for the use of the website for
online transactions;and take all other actions deemed necessary or appropriate for the investment
of funds of the Investor:
1. Name: Title:
Signature: Phone:
Email:
2. Name: Title:
Signature: Phone:
Email:
3. Name: Title:
Signature: Phone:
Email:
4. Name: Title:
Signature: Phone:
Email:
(a) The name of the Authorized Representative listed above that will be designated as
the primary contact and will receive all FLSTAR correspondence, including transaction
conformations and monthly statements, is:
Name:
(b) [The following additional[Investor] representative(not listed above)is designated
as an inquiry only representative ("Inquiry Only Representative") authorized to obtain account
information:
Name: Title:
Signature: Phone:
Email: ]
93931518.2
C-2
(c) The [Investor] may remove Authorized Representatives, designate other
Authorized Representatives, change Authorized Representatives to Inquiry Only
Representatives, or change Inquiry Only Representatives to additional Authorized
Representatives by written instrument signed by an existing and currently employed or retained
Authorized Representative, by the [Investors]'s chief executive officer or his/her designee, or by
the [Investor]'s chief financial officer or his/her designee.
(d) The taxpayer identification number for the [Investor] is .
(e) The contact information for the [Investor] is:
Primary mailing address:
Physical address (if different):
Main phone number:
Main fax number:
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the day first
above written.
Name of Investor:
By:
Authorized Representative
Printed Name and Title
Attest:
93931518.2
C-3
Authorized Representative
Printed Name and Title
Approved and accepted:
FLORIDA SHORT TERM ASSET RESERVE
By: Hilltop Securities Inc., as Co-Administrator
By: Date:
Authorized Signer
93931518 2
C-4
APPENDIX D
FORM OF GOVERNMENT FUND INVESTMENT POLICIES
93931518 2
B-1
FLSTAR
INVESTMENT POLICIES
GOVERNMENT FUND
ARTICLE I
STATEMENT OF PURPOSE AND OBJECTIVE
SECTION 1.01. ORGANIZATION.
(a) The Florida Short Term Asset Reserve ("FLSTAR") is an intergovernmental
investment pool organized under the authority of Section 218.415, Florida Statutes, and Section
163.01, Florida Statutes. FLSTAR was created by the Interlocal Agreement and Trust Instrument
(the "Interlocal Agreement"), among its Interlocal Members. FLSTAR is governed by a board of
trustees, a separate legal entity and public body corporate and politic created pursuant to Section
163.01(7), Florida Statutes (the "Board"). Any capitalized undefined terms used herein and not
otherwise defined shall have the meanings set forth in the Interlocal Agreement.
(b) The Board may establish separate Portfolios within FLSTAR from time to time.
The Board has created a Portfolio within FLSTAR to be called the "Government Fund." These
Investment Policies pertain to the Government Fund.
SECTION 1.02. SERVICE PROVIDERS. J.P. Morgan Investment Management
Inc., a corporation organized under the laws of Delaware("JPMIM" or the "Investment Manager"),
and Hilltop Securities Inc., a corporation organized under the laws of Delaware("HTS") serve as
Co-Administrators for FLSTAR under the Agreement for Investment Management and Related
Services, among FLSTAR acting through the Board, JPMIM, and HTS (the "Co-Administration
Agreement"). Pursuant to the Co-Administration Agreement, (a) JPMIM provides investment
management services, and (b)HTS provides participant and marketing services. Custodial,fund
accounting and depository services are provided by JPMorgan Chase Bank, N.A. (the
"Custodian"). Transfer agency services are provided by DST Asset Manager Solutions, Inc.
("DST"). Each of JPMIM, HTS, JPMorgan Chase Bank, N.A., and DST may provide certain
services, including those described herein through the use of subcontractors or delegates.
SECTION 1.03. INVESTMENT OBJECTIVES.
(a) The investment objectives of the Government Fund in order of importance are:
safety of capital, liquidity of funds, and investment income.
(b) These Investment Policies establish investment strategies,policies,and procedures
intended to assure that these objectives are met.
[Remainder of page intentionally left blank]
93931518 2
D-2
ARTICLE II
STANDARD OF CARE
SECTION 2.01. STANDARD OF CARE.
(a) FLSTAR shall be designed and managed in accordance with the following prudent
person standard of care (the "Prudent Person Rule"):
Investments shall be made with judgment and care, under circumstances then
prevailing, which persons of prudence, discretion, and intelligence exercise in
the management of their own affairs, not for speculation, but for investment,
considering the probable safety of their capital as well as the probable income to
be derived from the investment.
(b) This Prudent Person Rule shall apply to the management of the Government Fund.
ARTICLE III
GENERAL POLICIES
SECTION 3.01. AUTHORIZED INSTITUTIONS AND DEALERS. The securities
dealers, issuers, and banks from whom the Government Fund may purchase securities shall be
those approved by the Board. The Investment Manager shall maintain a list of such authorized
securities dealers,issuers, and banks from whom the Government Fund may purchase securities.
SECTION 3.02. THIRD PARTY CUSTODIAL AGREEMENTS.
(a) All Government Fund securities shall be held with a third party;and all securities
purchased by, and all collateral obtained by, the Government Fund shall be properly designated
as an asset of the Government Fund. No withdrawal of securities, in whole or in part, shall be
made from safekeeping,except by an authorized representative of FLSTAR.
(b) Securities transactions between a broker-dealer and the Custodian involving
purchase or sale of securities by transfer of money or securities will be made on a "delivery vs.
payment" basis, if applicable, to ensure that the Custodian will have the security or money, as
appropriate, in hand at the conclusion of the transaction.
SECTION 3.03. BID REOUIREMENT. When feasible and appropriate, the
Investment Manager shall competitively bid investments. Except as otherwise required by law,
the bid deemed to best meet the investment objectives stated herein shall be selected.
SECTION 3.04. MASTER REPURCHASE AGREEMENT. All institutions and
dealers approved by the Board to transact in repurchase agreements with the Government Fund
shall execute a Master Repurchase Agreement in the form provided by the Securities Industry
93931518 2
D-3
and Financial Markets Association and shall perform as stated in the Master Repurchase
Agreement.All repurchase agreement transactions shall adhere to the requirements of the Master
Repurchase Agreement.
SECTION 3.05. DOCUMENTATION. Reasonable documentation and a thorough
audit trail shall be maintained for all investment transactions consistent with Board policy.
SECTION 3.06. RISK AND DIVERSIFICATION. Investments shall be diversified
to the extent practicable to control the risk of loss resulting from overconcentration of assets in a
specific maturity, issuer, instrument, dealer, or bank through which financial instruments are
bought and sold.Diversification strategies shall be reviewed and revised periodically,as deemed
necessary by the Investment Manager.
SECTION 3.07. MATURITY AND LIQUIDITY REQUIREMENTS. The
Government Fund shall be structured in such a manner as to provide sufficient liquidity to the
Participants. To the extent possible, an attempt shall be made to match investment maturities
with known cash needs and anticipated cash-flow requirements.
SECTION 3.08. TEMPORARY CASH HOLDINGS.To respond to unusual market
conditions in a prudent manner, the Government Fund may be required to hold all or most of its
total assets in cash, including for the purpose of assuring sufficient liquidity or due to the lack of
eligible securities, among other circumstances. This may result in a lower yield and prevent the
Government Fund from meeting all its investment objectives.
SECTION 3.09. DISTRIBUTION OF GAINS AND LOSSES. So long as the
Government Fund continues to utilize amortized accounting, all gains or losses from the sale of,
and all other income received from, securities held in the Government Fund shall be distributed
among its Participants in proportion to their day-weighted Units in the Government Fund and
generally are amortized over a period of up to thirty (30) days from the date on which the gain,
loss, or income is realized or received.
SECTION 3.10. STABLE VALUE.
(a) The Government Fund seeks to maintain a stable value of$1.00 per unit(rounded
to the nearest whole cent). The $1.00 per unit value is not guaranteed or insured by FLSTAR or
the Co-Administrators. There can be no assurance that the Government Fund will maintain a
stable net asset value of$1.00.
(b) Although all securities in the Government Fund are marked to market daily using
the fair value method, amortized cost, which generally approximates the market value of
securities, is utilized. The Board, in its discretion, may elect to cease utilizing amortized
accounting and to commence utilizing the fair value method at any time. To the extent that the
Board elects to utilize a net asset value per share determined by using available market quotations
93931518 2
D-4
in lieu of amortized accounting, the Government Fund will reflect market fluctuations and any
unrealized gains and losses resulting from those fluctuations on a daily basis.
(c) If, upon a daily calculation, the Investment Manager finds that the deviation
between the amortized cost and market-determined values or the deviation between market-
determined values and$1.00 per unit of the Government Fund's assets exceeds$0.0040,the Board
shall direct the Investment Manager to take such action, if any, as it determines is necessary to
eliminate or reduce to the extent reasonably practicable of any dilution or unfair results to existing
Participants.
SECTION 3.11. MONITORING MARKET PRICE.Through one or both of the Co-
Administrators,the Government Fund shall account for all transactions and shall mark to market
the Government Fund's holdings on a daily basis through the use of independent or affiliated
commercial pricing services or third party broker-dealers. The market prices shall be checked
daily for current data and validity of information. In addition, a reasonability test shall be
performed in order to determine if the prices received are within a set tolerance range. In the
event that any of the prices fall outside of the set tolerance range,such prices shall be investigated.
SECTION 3.12. INTERNAL CONTROLS. FLSTAR shall have a system of internal
controls which shall be included in the Operating Procedures. The internal controls shall be
designed to prevent losses of funds which might arise from fraud, employee error,
misrepresentation by third parties, or imprudent actions by personnel. As part of the FLSTAR
financial audit, its independent auditors shall review such internal controls.
SECTION 3.13. REPORTING.
(a) Each Participant must obtain and should review the Information Statement before
investing.FLSTAR will furnish investment confirmations and a monthly report disclosing certain
information to the Participants. Additional information is available on the FLSTAR web site.
(b) The Co-Administrators shall prepare for the Board's approval and submission to
the Participants an annual report which shall include securities in the Government Fund by class
or type,book value, income earned, and market value as of the report date.Such reports shall be
available to the public.
SECTION 3.14. PERFORMANCE MEASUREMENT.FLSTAR will use iMoneyNet
Institutional Government Money Fund index as a benchmark of performance.
SECTION 3.15. CONTINUING EDUCATION.The FLSTAR trustee designated as
its investment officer shall annually complete at least eight (8) hours of continuing education in
subjects or courses of study related to investment practices and products.
93931518 2
D-5
ARTICLE IV
AUTHORIZED INVESTMENTS
SECTION 4.01. AUTHORIZED INVESTMENTS. The following are the types of
investment in which the Government Fund may invest:
(a) Obligations of the United States Government, its Agencies, and
Instrumentalities.
(i) Bills, notes, and bonds issued by the U.S. Treasury and backed by the full
faith and credit of the United States.
(ii) Obligations of any agency or instrumentality of the United States,
including but not limited to,obligations of The Federal Farm Credit Bank,the Federal Land Bank,
a Federal Home Loan Bank, the Federal Home Loan Mortgage Corporation, the Federal National
Mortgage Association, and the Government National Mortgage Association.
(iii) Obligations issued by entities with liquidity support from the U.S.
Government, or its agencies or instrumentalities (government sponsored enterprises). These
support arrangements provide that the U.S. Government or its agencies or instrumentalities will
advance funds to the entity to pay the obligations of the entity to the extent it has insufficient
funds to pay amounts due on its obligations.
(iv) Obligations of the United States Government, its agencies and
instrumentalities may include obligations with interest rates that adjust on set dates and are
reasonably expected to have a market value that approximates amortized cost on such dates
("variable rate notes"or"VRN")or obligations with interest rates that adjust whenever a benchmark
rate or index changes and are reasonably expected to have a market value that approximates
amortized cost("floating rate securities"). These obligations may have demand features which give
the Government Fund the right to demand repayment of principal on specified dates or after
giving a specified notice. Such securities may be deemed to have maturities shorter than their
stated maturity dates.
(b) Repurchase Agreements. Repurchase agreements with a termination date of 364
days or less collateralized by U.S. Treasury obligations, federal agency securities, and federal
instrumentality securities listed in Section 4.01(a) hereof. The purchased securities shall have a
minimum market value including accrued interest of 102 percent(102%)of the dollar value of the
transaction. Collateral shall be held by the Custodian or a sub-custodian, and market value of the
collateral securities shall be marked-to-the market daily. Repurchase agreement counterparties,
if rated, shall have a short-term credit rating of at least 'A-1' or the equivalent and a long-term
rating of at least'A' or the equivalent by S&P Global Ratings, a business unit of Standard&Poor's
Financial Services LLC("S&P"),Moody's Investors Service,Inc. ("Moody's"),or another nationally
recognized statistical rating organization (collectively, "NRSRO").
93931518.2
D-6
(c) Money Market Funds.No-load money market mutual funds that(i)are registered
with and regulated by the U.S. Securities and Exchange Commission; (ii) include in their
investment objectives the maintenance of a stable net asset value of$1.00; (iii) are rated 'AAAm'
or equivalent by at least one NRSRO; and (iv) invest only in obligations of the United States, its
agencies and/or instrumentalities, or repurchase agreements collateralized by obligations of the
United States, its agencies and/or instrumentalities.
(d) The Government Fund may not be invested in commercial paper, certificates of
deposit, or any other investments that are not listed above.
SECTION 4.02. PORTFOLIO STRUCTURE. The Government Fund shall be
designed and managed to ensure that it will meet all the requirements necessary to maintain a
'AAAm' rating(or the equivalent)by at least one NRSRO.The weighted average maturity of the
Government Fund shall be limited to: (a) a maximum sixty (60) days when calculated utilizing
the period remaining until the date on which, in accordance with the terms of each security, the
principal amount must unconditionally be paid,or in the case of a security called for redemption,
the date on which the redemption payment must be made, and may utilize the interest rate reset
date for variable rate notes or floating rate securities;and (b) a maximum of one hundred twenty
(120) days as calculated taking into account the period remaining until the date on which, in
accordance with the terms of each security, the principal amount must unconditionally be paid,
or in the case of a security called for redemption, the date on which the redemption payment
must be made. Specific portfolio composition and maturity limitation guidelines shall be guided
by the following general parameters.
(a) Portfolio Composition. The composition of the Government Fund shall be
limited as follows. Limitations shall be applied by comparing the amortized cost of the
Government Fund's investments at the time of purchase.
(i) United States Government Securities,Agencies,and Instrumentalities.Up to one
hundred percent (100%) of the Government Fund may be invested in obligations of,
unconditionally guaranteed or insured by, or backed by the full faith and credit of the United
States, its agencies, or instrumentalities, including government sponsored enterprises.
(ii) Repurchase Agreements. Up to one hundred percent (100%) of the
Government Fund may be invested in repurchase agreements.
(iii) Money Market Mutual Funds. Up to a maximum of ten percent(10%) of the
Government Fund may be invested in any one money market mutual fund, and the Government
Fund's investment in any one money market mutual fund may not exceed ten percent (10%) of
the total assets of that money market mutual fund.
93931518 2
D-7
(b) Maturity Limitations.
(i) Government Securities, Agencies and Instrumentalities. The maximum final
maturity for any securities that are obligations of or guaranteed or insured by the United States
government, its agencies, or instrumentalities shall be limited to 397 days for fixed rate securities,
397 days for floating rate securities rated below "AA-" by at least one NRSRO, two years (762
days)for floating rate securities rated"AA-"or higher by at least one NRSRO, and two years(762
days) for variable rate notes.
(ii) Repurchase Agreements. The maturity of repurchase agreements shall not
exceed 364 days unless the repurchase agreements have a put option that allows the fund to
liquidate the position at par(principal plus accrued interest).
93931518.2
D-8
APPENDIX E
FORM OF PRIME FUND INVESTMENT POLICIES
93931518 2
FLSTAR
INVESTMENT
POLICIES
PRIME FUND
ARTICLE I
STATEMENT OF PURPOSE AND OBJECTIVE
SECTION 1.01. ORGANIZATION.
(a) The Florida Short Term Asset Reserve("FLSTAR")is an intergovernmental
investment pool organized under the authority of Section 218.415, Florida Statutes, and
Section 163.01, Florida Statutes. FLSTAR was created by the Interlocal Agreement and
Trust Instrument (the "Interlocal Agreement"), among its Interlocal Members. FLSTAR is
governed by a board of trustees, a separate legal entity and public body corporate and
politic created pursuant to Section 163.01(7),Florida Statutes(the"Board").Any capitalized
undefined terms used herein and not otherwise defined shall have the meanings set forth
in the Interlocal Agreement.
(b) The Board may establish separate Portfolios within FLSTAR from time to
time. The Board has created a Portfolio within FLSTAR to be called the "Prime Fund."
These Investment Policies pertain to the Prime Fund.
SECTION 1.02. SERVICE PROVIDERS. J.P. Morgan Investment
Management Inc., a corporation organized under the laws of Delaware ("JPMIM" or the
"Investment Manager"), and Hilltop Securities Inc., a corporation organized under the laws
of Delaware ("HTS") serve as Co-Administrators for FLSTAR under the Agreement for
Investment Management and Related Services among FLSTAR acting through the Board,
JPMIM,and HTS(the"Co-Administration Agreement"). Pursuant to the Co-Administration
Agreement, (a)JPMIM provides investment management services, and (b) HTS provides
participant and marketing services. Custodial, fund accounting and depository services
are provided by JPMorgan Chase Bank, N.A. (the "Custodian"). Transfer agency services
are provided by DST Asset Manager Solutions, Inc. ("DST"). Each of JPMIM, HTS,
JPMorgan Chase Bank, N.A., and DST may provide certain services, including those
described herein through the use of subcontractors or delegates.
SECTION 1.03. INVESTMENT OBJECTIVES.
(a) The investment objectives of the Prime Fund in order of importance are:
safety of capital, liquidity of funds, and investment income.
(b) These Investment Policies establish investment strategies, policies,
and procedures intended to assure that these objectives are met.
93931518 2
ARTICLE II
STANDARD OF CARE
SECTION 2.01. STANDARD OF CARE.
(a) FLSTAR shall be designed and managed in accordance with the following
prudent person standard of care (the "Prudent Person Rule"):
Investments shall be made with judgment and care, under circumstances
then prevailing, which persons of prudence, discretion, and intelligence
exercise in the management of their own affairs, not for speculation, but
for investment, considering the probable safety of their capital as well as
the probable income to be derived from the investment.
(b) This Prudent Person Rule shall apply to the management of the Prime
Fund.
ARTICLE III
GENERAL POLICIES
SECTION 3.01. AUTHORIZED INSTITUTIONS AND DEALERS. The
securities dealers, issuers, and banks from whom the Prime Fund may purchase securities
shall be those approved by the Board. The Investment Manager shall maintain a list of
such authorized securities dealers, issuers, and banks from whom the Prime Fund may
purchase securities.
SECTION 3.02. THIRD PARTY CUSTODIAL AGREEMENTS.
(a) All Prime Fund securities shall be held with a third party;and all securities
purchased by, and all collateral obtained by, the Prime Fund shall be properly designated
as an asset of the Prime Fund. No withdrawal of securities, in whole or in part, shall be
made from safekeeping, except by an authorized representative of FLSTAR.
(b) Securities transactions between a broker-dealer and the Custodian
involving purchase or sale of securities by transfer of money or securities will be made on
a "delivery vs. payment" basis, if applicable, to ensure that the Custodian will have the
security or money, as appropriate, in hand at the conclusion of the transaction.
SECTION 3.03. BID REQUIREMENT. When feasible and appropriate, the
Investment Manager shall competitively bid investments. Except as otherwise required
93931518.2
by law, the bid deemed to best meet the investment objectives stated herein shall be
selected.
SECTION 3.04. MASTER REPURCHASE AGREEMENT. All institutions
and dealers approved by the Board to transact in repurchase agreements with the Prime
Fund shall execute a Master Repurchase Agreement in the form provided by the Securities
Industry and Financial Markets Association and shall perform as stated in the Master
Repurchase Agreement. All repurchase agreement transactions shall adhere to the
requirements of the Master Repurchase Agreement.
SECTION 3.05. DOCUMENTATION. Reasonable documentation and a
thorough audit trail shall be maintained for all investment transactions consistent with
Board policy.
SECTION 3.06. RISK AND DIVERSIFICATION. Investments shall be
diversified to the extent practicable to control the risk of loss resulting from
overconcentration of assets in a specific maturity, issuer, instrument, dealer, or bank
through which financial instruments are bought and sold. Diversification strategies shall
be reviewed and revised periodically, as deemed necessary by the Investment Manager.
SECTION 3.07. MATURITY AND LIQUIDITY REQUIREMENTS. The
Prime Fund shall be structured in such a manner as to provide sufficient liquidity to the
Participants. To the extent possible, an attempt shall be made to match investment
maturities with known cash needs and anticipated cash-flow requirements.
SECTION 3.08. TEMPORARY CASH HOLDINGS.To respond to unusual
market conditions in a prudent manner, the Prime Fund may be required to hold all or
most of its total assets in cash, including for the purpose of assuring sufficient liquidity or
due to the lack of eligible securities, among other circumstances. This may result in a
lower yield and prevent the Prime Fund from meeting all its investment objectives.
SECTION 3.09. DISTRIBUTION OF GAINS AND LOSSES.So long as the
Prime Fund continues to utilize amortized accounting, all gains or losses from the sale of,
and all other income received from, securities held in the Prime Fund shall be distributed
among its Participants in proportion to their day-weighted Units in the Prime Fund and
generally are amortized over a period of up to thirty (30) days from the date on which the
gain, loss, or income is realized or received.
SECTION 3.10. STABLE VALUE.
93931518 2
(a) The Prime Fund seeks to maintain a stable value of$1.00 per unit(rounded
to the nearest whole cent). The $1.00 per unit value is not guaranteed or insured by
FLSTAR or the Co-Administrators. There can be no assurance that the Prime Fund will
maintain a stable net asset value of$1.00.
(b) Although all securities in the Prime Fund are marked to market daily using
the fair value method, amortized cost, which generally approximates the market value of
securities, is utilized. The Board, in its discretion, may elect to cease utilizing amortized
accounting and to commence utilizing the fair value method at any time. To the extent
that the Board elects to utilize a net asset value per unit determined by using available
market quotations in lieu of amortized accounting, the Prime Fund will reflect market
fluctuations and any unrealized gains and losses resulting from those fluctuations on a
daily basis.
(c) The Investment Manager will make a daily calculation to determine
whether the Prime Fund's net asset value calculated by using available market quotations
deviates from $1.00 per unit based on amortized cost. If the deviation exceeds $0.0040,
the Investment Manager shall advise the Board, which may direct the Investment
Manager to take such action, if any, as it determines is necessary to eliminate or reduce to
the extent reasonably practicable any dilution or unfair results to existing Participants.
SECTION 3.11. MONITORING MARKET PRICE. Through one or both of
the Co-Administrators, the Prime Fund shall account for all transactions and shall mark
to market the Prime Fund's holdings on a daily basis through the use of independent or
affiliated commercial pricing services or third party broker-dealers. The market prices
shall be checked daily for current data and validity of information. In addition, a
reasonability test shall be performed in order to determine if the prices received are within
a set tolerance range. In the event that any of the prices fall outside of the set tolerance
range, such prices shall be investigated.
SECTION 3.12. INTERNAL CONTROLS. FLSTAR shall have a system of
internal controls which shall be included in the Operating Procedures. The internal
controls shall be designed to prevent losses of funds which might arise from fraud,
employee error, misrepresentation by third parties, or imprudent actions by personnel.
As part of the FLSTAR financial audit, its independent auditors shall review such internal
controls.
SECTION 3.13. REPORTING.
(a) Each Participant must obtain and should review the Information Statement
before investing. FLSTAR will furnish investment confirmations and a monthly report
93931518 2
disclosing certain information to the Participants. Additional information is available on
the FLSTAR web site.
(b) The Co-Administrators shall prepare for the Board's approval and
submission to the Participants an annual report which shall include securities in the Prime
Fund by class or type,book value, income earned, and market value as of the report date.
Such reports shall be available to the public.
SECTION 3.14. PERFORMANCE MEASUREMENT. FLSTAR will use
iMoneynet First Tier Institutional Index as a benchmark of performance.
SECTION 3.15. CONTINUING EDUCATION. The FLSTAR trustee
designated as its investment officer shall annually complete at least eight (8) hours of
continuing education in subjects or courses of study related to investment practices and
products.
ARTICLE IV
AUTHORIZED INVESTMENTS
SECTION 4.01. AUTHORIZED INVESTMENTS. The following are the
types of investment in which the Prime Fund may invest:
(a) Obligations of the United States Government, its Agencies, and
Instrumentalities.
(i) Bills, notes, and bonds issued by the U.S. Treasury and backed by
the full faith and credit of the United States.
(ii) Obligations of any agency or instrumentality of the United States,
including but not limited to, obligations of The Federal Farm Credit Bank, the Federal
Land Bank, a Federal Home Loan Bank, the Federal Home Loan Mortgage Corporation,
the Federal National Mortgage Association, the Government National Mortgage
Association, and the Tennessee Valley Authority.
(iii) Obligations issued by entities with liquidity support from the U.S.
Government, or its agencies or instrumentalities (government sponsored enterprises).
These support arrangements provide that the U.S. Government or its agencies or
instrumentalities will advance funds to the entity to pay the obligations of the entity to
the extent it has insufficient funds to pay amounts due on its obligations.
9393155 18 2
(b) Repurchase Agreements. Repurchase agreements with a termination date
of 364 days or less collateralized by U.S. Treasury obligations, federal agency securities,
and federal instrumentality securities described in Section 4.01(a)hereof with a minimum
market value including accrued interest of 102 percent (102%) of the dollar value of the
transaction or by cash equal to 100 percent(100%) of the dollar value of the transaction or
by a combination of such securities and cash. Collateral shall be held by the Custodian or
a sub-custodian, and market value of the collateral securities shall be marked-to-the
market daily. Repurchase agreement counterparties shall be rated in one of the two
highest short-term rating categories by a nationally recognized statistical rating
organization("NRSRO").
(c) Commercial Paper. The Prime Fund may invest in "prime quality"
commercial paper of corporations, including paper issued by bank holding companies
and high-quality asset-backed securities, with a maturity of 397 days or less. "Prime
quality" commercial paper must be rated in one of the two highest short-term rating
categories of a NRSRO.
(d) Corporate Notes and Bonds. The Prime Fund may invest in bonds, notes
and other evidences of indebtedness or obligations issued by corporations having a
remaining maturity less than or equal to 397 days. All such debt obligations shall be rated
in one of the two highest short-term rating categories by a NRSRO.
(e) Obligations of Banks. The Prime Fund may purchase bankers'
acceptances, certificates of deposit, time deposits and negotiable bank deposit notes
issued by domestic banks and foreign banks. Yankee instruments are denominated in
U.S. dollars and issued by U.S. branches of foreign banks. Eurodollar instruments are
denominated in U.S. dollars and issued by non-U.S. branches of U.S. or foreign banks.
The Prime Fund may invest in Bank obligations with maturities of 397 days or less if rated
in one of the two highest short-term rating categories of a NRSRO. The Prime Fund will
not invest in any bank obligation with a remaining maturity greater than 397 days.
(f) Asset Backed Securities. The Prime Fund may invest in asset backed
securities. Asset backed securities are payable from pools of obligations, many of which
involve consumer or commercial debt. Asset backed securities take the form of
commercial paper, notes or pass-through certificates.
(g) Foreign Securities. The Prime Fund may invest in foreign securities issued
in U.S. dollars by issuers based outside the United States, so long as they are eligible
investments under the foregoing categories.
93931518 2
(h) Floating-Rate and Variable-Rate Obligations. The Prime Fund may
purchase obligations that have interest rates that adjust on set dates and are reasonably
expected to have a market value that approximates amortized cost on such dates(variable
rate obligations or "VRN") or obligations that have interest rates that adjust whenever a
benchmark rate or index changes and are reasonably expected to have a market value that
approximates amortized cost (floating rate obligations). These obligations may have
demand features which give the Prime Fund the right to demand repayment of principal
on specified dates or after giving a specified notice. Such securities may be deemed to
have maturities shorter than their stated maturity dates.
(i) Money Market Funds. The Prime Fund may invest in no-load money
market mutual funds that (i) are registered with and regulated by the U.S. Securities and
Exchange Commission; (ii) include in their investment objectives the maintenance of a
stable net asset value of$1.00; and (iii) are rated 'AAAm' or equivalent by a NRSRO.
(j) The Prime Fund may not engage or invest in short sales, margin
transactions, commodity or future contracts, venture capital, or initial public offerings,
option trading and derivative transactions.
(k) The Prime Fund may not be invested in asset backed commercial paper
securities that are classified as structures investment vehicles (Sly), collateralized debt
obligations (CDO), structured arbitrage vehicles (SAV) or extendible commercial paper.
The Prime Fund may not invest in obligations whose payment represents the coupon
payments on the outstanding principal balance of the underlying mortgage-backed
security collateral and pays no principal, obligations whose payment represents the
principal stream of cash flow from the underlying mortgage-backed security collateral
and bears no interest, collateralized mortgage obligations and derivatives.
SECTION 4.02. PORTFOLIO STRUCTURE. The Prime Fund shall be
designed and managed to ensure that it will meet all the requirements necessary to
maintain a 'AAAm' rating (or the equivalent) by at least one NRSRO. The weighted
average maturity of the Prime Fund shall be limited to: (a) a maximum sixty (60) days
when calculated utilizing the period remaining until the date on which, in accordance
with the terms of each security,the principal amount must unconditionally be paid, or in
the case of a security called for redemption, the date on which the redemption payment
must be made, and may utilize the interest rate reset date for variable rate notes or
floating rate securities; and (b) a maximum of one hundred twenty (120) days as
calculated taking into account the period remaining until the date on which, in
accordance with the terms of each security, the principal amount must unconditionally
be paid, or in the case of a security called for redemption, the date on which the
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redemption payment must be made. Specific portfolio composition and maturity
limitation guidelines shall be guided by the following general parameters.
(a) Portfolio Composition. The composition of the Prime Fund shall be
limited as follows. Limitations shall be applied by comparing amortized cost of the Prime
Fund's investments at the time of purchase.
(i) United States Government Securities, Agencies, and Instrumentalities.
Up to one hundred percent (100%) of the Prime Fund may be invested in obligations of,
unconditionally guaranteed or insured by, or backed by the full faith and credit of the
United States, its agencies, or instrumentalities, including government sponsored
enterprises.
(ii) Repurchase Agreements. Up to one hundred percent (100%) of the
Prime Fund may be invested in repurchase agreements.
(iii) Commercial Paper. No more than 5% of the Prime Fund may be
invested in the commercial paper of any single entity (including affiliates).
(iv) Corporate Notes and Bonds. No more than 5%of the Prime Fund may
be invested in corporate notes and bonds of any single entity (including affiliates).
(v) Money Market Mutual Funds.Up to a maximum of ten percent(10%)
of the Prime Fund may be invested in any one money market mutual fund, and the Prime
Fund's investment in any one money market mutual fund may not exceed ten percent
(10%) of the total assets of that money market mutual fund.
(vi) Industry. No more than 25%of the assets of the Prime Fund may be
invested in a single industry or business sector; provided that this limitation does not
apply to securities issued or guaranteed by companies in the financial services or banking
industries.
(b) Maturity Limitations.
(i) Government Securities, Agencies and Instrumentalities. The maximum
final maturity for any securities that are obligations of or guaranteed or insured by the
United States government, its agencies, or instrumentalities shall be limited to 397 days
for fixed rate securities and two years (762 days) for variable rate notes.
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(ii) Repurchase Agreements. The maturity of repurchase agreements
shall not exceed 364 days unless the repurchase agreements have a put option that allows
the fund to liquidate the position at par(principal plus accrued interest).
(iii) Based on Ratings. The maximum final maturity for a fixed-rate
investment, a non-sovereign government floating rate investment, and a sovereign
floating rate investment rated below "AA-" or equivalent rating by at least one NRSRO is
397 days. The maximum final maturity for a sovereign government(including sovereign
government related/guaranteed) floating rate security rated at least "AA-" or an
equivalent rating by at least one NRSRO is two years (762 days).
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