Common use of Security for Deposits Clause in Contracts

Security for Deposits. Generally. Bank promises that all funds of County which are on deposit with Bank will be insured by the Federal Home Loan Bank of Dallas, to the extent permitted by law, and secured in compliance with the provisions of the Public Funds Collateral Act as it presently exists or is hereafter amended, and any other applicable local, state or federal laws, by pledging certain securities as collateral to County. Allegiance Bank, desires to qualify as such Depository by pledging securities with the Commissioners' Court in the amount provided by law under Section 116.058, Local Government Code, specifically Federal Home Loan Bank Letters of Credit and Securities eligible under Texas Government Code, 2257.002 (4)(F). Provided that the market value of securities which the bank is obligated to pledge is never below the total deposits. Once Letters of Credit are issued by the Federal Home Loan Bank on behalf of the Jefferson County, TX the original Letter of Credit will remain in the possession of the County for the duration of the contract. The bank will monitor daily, the balances of all County deposits to ensure adequate collateral coverage per the Texas Public Funds Code 2257. Monthly collateral reports will be provided to the County, if the County requires confirmation of collateral it can be requested of the bank at any time and provided to the County in a timely manner. Depositor may sell all or any part of such collateral and out of the proceeds thereof, pay Depositor all damages and losses sustained together with any expenses incurred by it of any kind on account of such failure. Collateral may be sold by Depositor at public or private sale provided however that Depository shall have one business day notice of the time and place of the sale, and Depository and Custodian shall have the right to bid at such sale. When securities pledged hereunder shall be in excess of the amount required under the provisions of Section 116.054, Local Government Code, and other pertinent statutes, the Commissioners' Court shall permit the release of such excess. When the funds on deposit with said Depository Bank shall for any reason increase beyond the amount of security provided, said Bank shall immediately pledge additional securities to the Commissioners' Court hereunder to the end that securities pledged shall at no time be less than the total amount of funds on deposit in the Depository Bank and covered by this Depository Contract.