Executive Committee of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, January 18, 2024
1:30 p.m.
Visit CPA’s YouTube Channel to view a Live Stream of the Meeting www.youtube.com/@CPApublicmeetings
*There may be a streaming delay of up to 90 seconds. This is a view-only live stream.
Clean Power Alliance
Executive Conference Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Members of the public may also participate in this meeting remotely at the following locations:
Agoura Hills City Hall
Planning Conference Room
30001 Ladyface Court
Agoura Hills, CA 91301
Ventura County Government Center
Channel Islands Conference Room, 4th Floor
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Capitol Hilton
Business Center
1001 16th Street NW
Washington, D.C. 20036
Los Angeles County Hall of Administration
Sybil Brand Conference Room, Room 372
500 West Temple Street
Los Angeles, CA 90012
Camarillo City Hall
Office of the Mayor
601 Carmen Drive
Camarillo, CA 93010
Ojai City Hall
Conference Room
401 S Ventura St.
Ojai, CA 93023
Sierra Madre City Hall
Council Chambers
232 W. Sierra Madre Blvd.
Sierra Madre, CA 91024
Carson City Hall
Executive Conference Room
701 East Carson Street
Carson, CA 90745
South Bay Cities Council of Governments
Conference Room
2355 Crenshaw Blvd., Suite 125
Torrance, CA 90501
PUBLIC COMMENT: Members of the public may submit their comments by one of the following options:
• Email Public Comment: Members of the public are encouraged to submit written comments on any agenda item to [email protected] up to four hours before the meeting. Written public comments will be announced at the meeting and become part of the meeting record. Public comments received in writing will not be read aloud at the meeting. • Provide Public Comment During the Meeting: The General Public Comment item is reserved for persons wishing to address the Committee on any Clean Power Alliance-related matters not on today’s agenda. Public comments on matters on today’s Consent Agenda and Regular Agenda Agenda Page 1 of 83
shall be heard at the time the matter is called. Comments on items on the Consent Agenda are consolidated into one public comment period. Members of the public who wish to address the Committee at CPA’s Office are requested to complete a comment card and provide it to staff. If you are attending from a remote location, please identify yourself to a CPA representative when your item is called. Each speaker is limited to two (2) minutes (in whole-minute increments) per agenda item with a cumulative total of five 5 minutes to be allocated between the General Public Comment, the entire Consent Agenda, or individual items in the Regular Agenda. Please refer to Policy No. 8 – Public Comment for additional information.
NAVIGATING OUR AGENDA PACKETS
The meeting agenda packets are bookmarked PDFs, which display a list of agenda items to the left of the page and allow you to click to view specific items within the packet. If viewing in your browser, click the "document outline" button in the upper left corner of the screen. If the PDF is downloaded, the bookmark panel (ribbon icon) appears on the left side of the screen.
ACCESSIBILITY: Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least two (2) working days before the meeting at [email protected] or (213) 713- 5995. Notification in advance of the meeting, while not required, will enable us to make reasonable arrangements to ensure accessibility to this meeting and the materials related to it.
CALL TO ORDER AND ROLL CALL
GENERAL PUBLIC COMMENT
CONSENT AGENDA
1. Approve Minutes from November 16, 2023, Executive Committee Meeting
REGULAR AGENDA
Information Items
2. Oral Update from the CEO on CPA Operations
3. Receive Presentation on 2024 Board Outlook – Major Items
4. Review Draft Agenda for the February 1, 2024, Board of Directors Meeting Action Item
5. Recommend to the Board of Directors to Authorize Staff to i) Deposit CPA Funds Into the California Asset Management Program as an Investor ii) Amend CPA’s Investment Policy to Permit Investment in CAMP and iii) Execute the CAMP Investor Agreement and any Other Required Documents
COMMITTEE MEMBER COMMENTS
ADJOURN – NEXT REGULAR MEETING ON FEBRUARY 15, 2024
Public Records: Public records that relate to any item on the open session agenda for a Committee Meeting are available for public inspection. Those records that are distributed less than 72 hours prior to the meeting are available for public inspection at the same time they are distributed to all, or a majority of, the members of the Committee. Public records are available for inspection at CPA’s Office at 801 S. Grand Ave., Suite 400, Los Angeles, CA 90017, or online at www.cleanpoweralliance.org/agendas.
Agenda Page 2 of 83
Staff Report – Agenda Item 1
To: Executive Committee
Subject: Approve Minutes from the November 16, 2023 Executive Committee Meeting
Date: January 18, 2024
RECOMMENDATION
Approve.
ATTACHMENT
1. Minutes
Agenda Page 3 of 83
Executive Committee Item 1
MINUTES
Executive Committee of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, November 16, 2023
1:30 p.m.
Meeting videos are available on CPA's YouTube Channel.
http://www.youtube.com/@CPApublicmeetings
Committee Members participated in this meeting from the following locations:
Agoura Hills City Hall
Planning Conference Room
30001 Ladyface Court
Agoura Hills, CA 91301
Clean Power Alliance
Executive Conference Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Beverly Hills City Hall
Council Office, 4th Floor
455 N. Rexford Drive
Beverly Hills, 90210
Camarillo City Hall
Office of the Mayor
601 Carmen Drive
Camarillo, CA 93010
Ventura County Government Center
Channel Islands Conference Room, 4th Floor
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Carson City Hall
Executive Conference Room
701 East Carson Street
Carson, CA 90745
Los Angeles County Hall of Administration
Sybil Brand Conference Room, Room 372
500 West Temple Street
Los Angeles, CA 90012
Oakland Marriott City Center
M Club, 2nd Floor
1001 Broadway
Oakland, California 94607
South Bay Cities Council of Governments
Conference Room
2355 Crenshaw Blvd., Suite 125
Torrance, CA 90501
CALL TO ORDER & ROLL CALL
Chair Gold called the meeting to order at 1:30 p.m. and Raynette Tom, Executive Assistant, conducted roll call.
Roll Call
Agoura Hills Deborah Klein Lopez Committee Member Remote Beverly Hills Julian Gold Chair Remote
Camarillo Susan Santangelo Committee Member Remote
Carson Reata Kulcsar
Alternate Committee
Member Remote
Hawthorne Alex Monteiro Committee Member Present
Los Angeles County Rita Kampalath Committee Member Remote Agenda Page 4 of 83
Executive Committee Item 1
Ojai Betsy Stix Committee Member Remote
Sierra Madre Robert Parkhurst Committee Member Remote*
South Pasadena Diana Mahmud Immediate Past Chair Present Ventura County Vianey Lopez Vice Chair Remote
*Committee Member Parkhurst joined as a meeting participant but did not count towards quorum.
All votes are unanimous unless otherwise stated.
GENERAL PUBLIC COMMENT
There was no public comment.
CONSENT AGENDA
1. Approve Minutes from October 19, 2023, Executive Committee Meeting Motion:
Second:
Vote:
Committee Member Mahmud, South Pasadena
Committee Member Santangelo, Camarillo
The consent agenda was approved by a roll call vote with an abstention from Committee Member Kampalath.
REGULAR AGENDA
2. Oral Update from the CEO on CPA Operations
Ted Bardacke, CEO, announced that the Cities of Port Hueneme, La Cañada-Flintridge, and Lynwood voted to join CPA and have scheduled adoption of their respective ordinances in the coming weeks.
3. Review Draft Agenda for the December 7, 2023, Board of Directors Meeting Mr. Bardacke discussed items on the Board consent agenda, including two potential administrative amendments to Power Purchase Agreements (PPAs), Community Solar tariff amendments, and Net Energy Metering (NEM) 3.0 billing implementation plans. Mr. Bardacke also discussed the public hearing item to approve CPA’s implementation plan for the three cities.
Mr. Bardacke discussed the proposed changes to the 2024 Legislative and Regulatory Policy Platform as part of the Board’s regular agenda item.
CLOSED SESSION
4. PUBLIC EMPLOYEE PERFORMANCE EVALUATION: 1
(Government Code Section 54957)
Title: General Counsel
Nancy Whang, General Counsel, noted that no reportable action was taken.
5. PUBLIC EMPLOYEE PERFORMANCE EVALUATION: 1
(Government Code Section 54957)
Title: Chief Executive Officer
Ms. Whang noted that no reportable action was taken.
Agenda Page 5 of 83
Executive Committee Item 1
COMMITTEE MEMBER COMMENTS
None.
ADJOURN
Chair Gold adjourned the meeting at 2:54 p.m.
Agenda Page 6 of 83
Staff Report – Agenda Item 2
To: Executive Committee
From: Ted Bardacke, Chief Executive Officer
Subject: Oral Update from the CEO on CPA Operations
Date: January 18, 2024
The CEO will provide an oral update on CPA operations, including:
• New cities enrollment activities
• Sacramento activities
• CalCCA Annual Meeting (San Jose – April 16-18)
Agenda Page 7 of 83
Staff Report – Agenda Item 3
To: Executive Committee
From: Ted Bardacke, Chief Executive Officer
Subject: Presentation on 2024 Major Board Items
Date: January 18, 2024
RECOMMENDATION
Staff will provide a presentation on the item.
ATTACHMENT
1. 2024 Board Outlook - Major Items
Agenda Page 8 of 83
2024 Board Outlook – Major Items
January 18, 2024
Major items before the CPA Board in 2024 will broadly be contained in four categories. Many of these are recurring functions; there will be particular emphasis on customer/community programs launch and delivery
1. Governance & Policy
2. Customer & Community Programs
3. Energy Procurement
4. Finance/Budget/Rates
Other specific operational matters will come to the Board as needed Some broader themes and strategic items will be taken up at Board retreat/new leadership reception tentatively scheduled for June 21 2 Summary
First Quarter Major Items
Governance & Policy Customer &
Community Programs
Energy Procurement Finance/Rates/Budget
Election of New Board
Chair
Launch “Energized
Communities” (Fleet
Electrification, Building
Electrification, Public Charging,
Innovation Grant)
PPAs from 2023 RFO Renew Credit
Agreement
New Board Chair
Selects Committee
Chairs
Power Ready PPA
Expand Cash
Investment Options
Power Response 2024
Contract
Launch Home Battery
Incentives
Second Quarter Major Items
Governance & Policy Customer &
Community Programs
Energy Procurement Finance/Rates/Budget
Election of Executive
Committee At-Large
Members
Launch Energy
Advisor
PPAs from 2023 RFO FY 24/25 Budget and
Rates
Board Retreat and New
Leadership Reception
(June 21)
2025 and 2026 Product Content
3rd Prepay Bond
Select Cash
Management Advisor
FY 23/24 Budget
Adjustment
Third/Fourth Quarter Major Items
Governance & Policy Customer &
Community Programs
Energy Procurement Finance/Rates/Budget
Energy Risk
Management Policy
Amendments
Open Power Ready
Round 2
2024 Integrated
Resources Plan (IRP)
FY 23/24 Audited
Financial Results
Board Recomposition
(Post November local elections)
Implement Workforce
Development Round 3
PPAs from 2024 RFO 2025 Rates Outlook
2025 Legislative &
Regulatory Policy
Platform
Launch Low Income
Solar + Storage
Program
Bi-Annual Salary
Study and Employee
Handbook Updates
Launch Managed EV
Charging Program
Staff Report – Agenda Item 4
To: Executive Committee
From: Ted Bardacke, Chief Executive Officer
Subject: Review Draft Agenda for the February 1, 2024 Board of Directors Meeting
Date: January 18, 2024
Staff will provide an overview of the proposed agenda items for the February 1, 2024 Board of Directors meeting for review and feedback from the Executive Committee. The draft Board agenda is attached to this staff report. Information on the main items for Board consideration is provided below.
CONSENT AGENDA
The following items are recommended for inclusion on the Consent Agenda of the February Board meeting.
Demand Response Contract Amendment
CPA’s Power Response program has been supported by AutoGrid since Board approval of the contract for Demand Response Implementation Services in September 2021. The program has operated for two full summers under the first Agreement term and has successfully enrolled over 3,000 customers and 2 MW of dispatchable capacity. The program has continued to expand participation options, now offering four distinct program pathways for residential homeowners, renters, businesses, and public sector entities to earn money while conserving energy when demand is high.
The initial 30-month contract term expires on March 3, 2024, and allows for an option to extend the contract for 3 successive one-year terms. The proposed contract amendment will include a one-year extension for continued support from AutoGrid, with an enrollment Agenda Page 14 of 83
Executive Committee Item 4
target of an additional 2 MW of demand response capacity by the end of the first renewal term. The amendment will also include improvements to the customer experience, additional devices and partnerships, and program changes to increase the availability of smart thermostats to the LMI community. The one-year contract value is approximately $900,000 and includes costs to support program implementation, program administration, trade ally fees, and customer incentives. This amount has been budgeted for the in the FY 2023/24 budget; the spending level proposed for year three is similar to that for each of the previous two years.
Energy Exemplar Software Contract
Production cost modeling software is commonly used for energy planning functions by simulating electric grid operations and producing a distribution of cost and reliability outcomes and their associated probabilities. This software can be used for project valuation, short-term operations and planning, procurement portfolio risk and sensitivity analysis, price forecasting, long-term integrated resource planning (IRP), and policy evaluation. CPA uses Energy Exemplar’s PLEXOS modeling software, primarily for long-term Integrated Resource Planning and for short-term planning and operation of energy storage resources.
CPA’s contract with Energy Exemplar for PLEXOS will expire on February 5, 2024. CPA is proposing to sign a new contract with Energy Exemplar. The proposed contract is a one-year contract that includes the software with 2 user license keys, cloud services, and essential datasets at a cost of $228,671, with two additional annual renewals authorized for the software license, cloud services, and datasets, at CPA’s discretion. The contract also has the option for consulting services to support CPA’s procurement planning modeling activities based on hourly rates for an annual not to exceed cost of $25k. The total value for the contract including consulting services and all possible renewals for a 3- year period is expected to be approximately $808k ($253k in the first year and approximately $270k for the first renewal year and approximately $285k in the second renewal year). CPA budgeted for the first-year costs of this software renewal in the Board-approved Fiscal Year 22/23 budget.
Agenda Page 15 of 83
Executive Committee Item 4
Authorize Investments in the California Asset Management Program (CAMP) This item will be the subject of a separate presentation to the Executive Committee.
REGULAR AGENDA
The following items are recommended for inclusion on the Regular Agenda of the February Board meeting.
Power Purchase Agreements
Staff is in the process of negotiating several long-term contracts from the 2023 Clean Energy and Reliability RFO from the shortlist approved by the Energy Committee. Should these negotiations be successful, up to three PPAs may be presented for consideration at the February Board meeting.
Power Ready PPA
Staff is in the process of negotiating a Power Purchase Agreement with the counterparty shortlisted by the Energy Committee for the 11 municipal sites in the first round of the Power Ready program. Should the negotiation be successful, the PPA may be presented for consideration at the February Board meeting.
Quarterly Communications and Marketing Report and 2024 Look Ahead Communications and Marketing will present an informational update and look ahead to activities and outreach planned for 2024. Highlights will include outreach and engagement with communities CPA serves, marketing new and existing customer programs to increase awareness and foster enrollment, CPA’s ongoing brand campaign to further build understanding of our organization, and the creation of a new online tool to provide member agencies and community advisors streamlined access to key information.
The presentation will also include a quarterly update on communications and outreach to Hermosa Beach, Monrovia, and Santa Paula supporting the transition to CPA service, growth in website, social media, and earned media audiences, and a review of brand tracking following CPA’s first brand campaign.
Agenda Page 16 of 83
Executive Committee Item 4
Open Nomination Period for Board Chair for Q2 2024 and July 2024 – June 2026 Time Periods
Due to term limits, current CPA Board Chair Julian Gold will be leaving the Beverly Hills City Council after the March 5, 2024 municipal election. This will necessitate the selection of a new CPA Board Chair. To maximize continuity, it is recommended that the Board simultaneously elect a new Board Chair to serve both the remaining three months of Chair Gold’s two-year term and a full two-year term, which will run from July 2024 through June 2026.
In order for a Board Chair election to take place at the March Board meeting, the nomination period for that position will open at the February Board meeting and remain open until February 16. Directors who are eligible to be nominated are listed in Attachment
1.1 The election of a new Board Chair will set in motion a process for the selection of Committee Chairs and thereafter election of At-Large Members of the Executive Committee according to the schedule below.
Feb 1 – Feb 16: Board Chair Nomination Period
March 7: Election of Board Chair
By March 22: Board Chair selects Committee Chairs for July 2024 – June 2026 April 4 – April 19: At-Large Executive Committee Nomination Period (3 positions) May 2: Election of At-Large Executive Committee Members June 21: Board Retreat and New Leadership Reception
July 1: Board Chair, Committee Chairs, Executive Committee At-Large Members begin two-year term
1 Per CPA’s By-laws, the eligibility criteria for Board Chair, Committee Chairs, and At-Large Executive Committee positions are:
1. Must be a Regular Director (i.e., not an Alternate)
2. Must have attended at least 50% of the regular Board Meetings in the last 12 months (attendance requirement can be fulfilled as either a Regular Director or Alternate)
3. Must affirm intent to serve a full two-year term (candidates running for local office in November 2024 are eligible to stand for election as CPA Board Chair or Executive Committee At-Large, as well as be appointed to Committee Chair positions)
Agenda Page 17 of 83
Executive Committee Item 4
ATTACHMENTS
1. Current Eligible Directors for Board Chair
2. Draft February 1, 2024 Board of Directors Agenda
Agenda Page 18 of 83
Executive Committee Item 4
Attachment 1
Current Eligible Directors for Board Chair/
Committee Chairs/Executive Committee
Deborah Klein Lopez Agoura Hills
Jeff Maloney Alhambra
Michael Cao Arcadia
Susan Santangelo Camarillo
Cedric Hicks Carson
Corey Calaycay Claremont
Alex Monteiro Hawthorne
Lindsey Horvath* Los Angeles County
Marianne Riggins Malibu
Amy Howorth Manhattan Beach
Renee Delgado Moorpark
Betsy Stix Ojai
Bert Perello Oxnard
Vilma Cuellar Stallings Paramount
Debby Stegura Rolling Hills Estates
Gleam Davis Santa Monica
Jenny Crosswhite Santa Paula
Robert Parkhurst Sierra Madre
Rocky Rhodes Simi Valley
David Newman Thousand Oaks
Liz Campos Ventura City
Vianey Lopez* Ventura County
John Erickson West Hollywood
* Automatic Vice Chair Appointment
Agenda Page 19 of 83
Executive Committee Item 4
Regular Meeting
Board of Directors
Clean Power Alliance of Southern California
Thursday, February 1, 2024
2:00 p.m.
CALL TO ORDER AND PLEDGE OF ALLEGIANCE
ROLL CALL
GENERAL PUBLIC COMMENT
CLOSED SESSION
CONSENT AGENDA
1. Approve Minutes from the December 7, 2023 Board of Directors Meeting
2. Approve Contract with Energy Exemplar Software
3. Approve a One-Year Extension of the Demand Response Contract with AutoGrid
4. Authorize Staff to Invest CPA Funds in the California Asset Management Program
5. Receive and File Bill Positions Monthly Report
6. Receive and File Monthly Community Advisory Committee Report
REGULAR AGENDA
Action Items
7. Approve Three Power Purchase Agreements for Renewable Energy and/or Energy Storage
8. Approve a Power Purchase Agreement under the Power Ready Program Information Item
9. Quarterly Communications Report and 2024 Look Ahead
Election Item
10.Open Nomination Period for Board Chair for Q2 2024 and July 2024 – June 2026 Time Periods
COMMITTEE CHAIR UPDATES
MANAGEMENT REPORT
BOARD MEMBER COMMENTS
REPORT FROM THE CHAIR
ADJOURN – NEXT MEETING ON MARCH 7, 2024
Agenda Page 20 of 83
Staff Report – Agenda Item 5
To: Executive Committee
From: David McNeil, Chief Financial Officer
Kate Freeman, Strategic Finance Manager
Approved By: Ted Bardacke, Chief Executive Officer
Subject: California Asset Management Program (CAMP) Investment Proposal
Date: January 18, 2024
RECOMMENDATION
Recommend to the Board of Directors to authorize staff to i) deposit CPA funds into the California Asset Management Program (CAMP) as an ”Investor” ii) amend CPA’s Investment Policy to permit investment in CAMP and iii) execute the CAMP Investor Agreement and any other required documents.
ATTACHMENTS
1. Presentation on Proposed CAMP Investment
2. CAMP Declaration of Trust
3. CAMP By-Laws
4. CAMP Investor Agreement
5. Proposed Amended CPA Investment Policy (Redline)
Agenda Page 21 of 83
Item 5 – California Asset Management
Program (CAMP) Investment Proposal
January 18, 2024
Agenda Page 22 of 83
Recommend to the Board of Directors to authorize staff to i) deposit CPA funds into the California Asset Management Program (CAMP) as an ”Investor” ii) amend CPA’s Investment Policy to permit investment in CAMP and iii) execute the CAMP Investor Agreement and any other required documents
Recommendation
Agenda Page 23 of 83
Background
3 Staff manage cash balances and invest surplus funds consistent with California state law and CPA’s Board-approved Investment Policy ensuring (in order of priority) the safety of funds, the availability of funds, and investment returns
Investing CPA funds in CAMP would allow CPA to meet its Investment Policy objectives, most notably by earning significantly higher returns that those currently available on savings accounts or from the Local Agency Investment Fund (LAIF). See slides 8-11 for details on CAMP history, governance and investment pools.
On January 11, 2024, the Finance Committee recommended that the Board authorize staff to invest CPA funds in CAMP
Agenda Page 24 of 83
4 Public Agencies can invest in CAMP either as Participants or Investors Participants
Are required to join the CAMP JPA
Have voting rights pertaining to i) the election of board members ii) amendments to governing documents iii) merger, consolidation or sale of assets iv) termination of CAMP v) changes to investment restrictions and policies. Participants may stand for election to the board.
Voting rights are weighted by the amount of funds each agency has invested in CAMP; based on CAMP’s current assets under management, CPA’s estimated voting share would be ~0.5 – 1% Investors
Are not JPA members and have no voting rights on the operations or governance of CAMP Investor relationships with CAMP are substantially similar to CPA’s relationship to LAIF Participants and Investors both receive the same returns on invested funds and are governed by the same rules of investment and withdrawal of funds; there is no financial impact associated with choosing one option over the other Options for Investing in CAMP
Agenda Page 25 of 83
5 Option 1 (recommended): Deposit funds into CAMP as an Investor Investors benefit from the same investment options as JPA members (see slide 4) Visibility into changes at CAMP is high (CAMP funds are AAA credit-rated; Investors are notified in the event of changes to the Investment Policy and related operations) CPA can withdraw its funds from CAMP on a same-day basis without penalty should concerns arise with CAMP's management of CPA funds Option 2: Join the CAMP JPA as a Participant*
Would provide CPA with a voting rights share estimated at 0.5% - 1% CPA would take on administrative duties – e.g., annual proxy voting – associated with CAMP JPA membership; voting typically takes place annually but votes can occur on a quarterly basis
Discussion
*To join the CAMP JPA as a participant, the Board would need to adopt a resolution approving participation in CAMP, authorizing Staff to execute the Declaration of Trust. Membership does not require approval by the CAMP Board of Trustees Agenda Page 26 of 83
Recommend to the Board of Directors to authorize staff to i) deposit CPA funds into the California Asset Management Program (CAMP) as an ”Investor” ii) amend CPA’s Investment Policy to permit investment in CAMP and iii) execute the CAMP Investor Agreement and any other required documents
Recommendation
Agenda Page 27 of 83
Questions?
Agenda Page 28 of 83
CAMP Overview
CAMP is a California JPA established in 1989 under provisions of the California Joint Exercise of Powers Act to provide public agencies with professional investment services CAMP has roughly $17B assets under management, comparable to LAIF’s $20B AUM 160 California counties, cities and public agencies are CAMP members, including 45 of California’s 58 counties
CPA member cities: Arcadia, Paramount, Simi Valley
CCAs: Silicon Valley Clean Energy, Peninsula Clean Energy Southern California cities: Glendale, Burbank
Service Providers
Investment Adviser, Administrator & Transfer Agent: PFM Asset Management Depository and Custodian: US Bank, NA
Independent Auditor: Ernst & Young, LLC
Counsel: Nossaman LLP
Rating agencies: S&P, Fitch
Agenda Page 29 of 83
9 Staff recommend investing CPA funds into CAMP for the following reasons:
Safety
CAMP funds are governed by an investment policy which is aligned with i) California state code which only permits investments in a narrow and low risk list of eligible securities and ii) CPA’s own investment policy; funds are subject to Local Agency Protection Program which protects agency deposits Funds are professionally managed by PFM, a nationally-recognized fixed income asset manager with $160 billion of assets under management. Nearly all portfolio funds are invested in instruments rated A-1 or A-1+. The cash management pool has an average term to maturity of approximately 60 days The investment pools are AAA rated by Fitch and S&P
Flexibility
Up to same-day liquidity; no term commitment, in contrast with instruments like CDs or US Treasury securities
Returns
CAMP interest rates are currently ~2% higher than LAIF or savings accounts and CPA has reached its Investment Policy limit for investments in CDs
Should CAMP rates fall below LAIF or savings account rates in the future, CPA can shift funds from CAMP to LAIF or savings accounts as needed
Investment Discussion and Analysis
Agenda Page 30 of 83
CAMP Overview - Governance
CAMP is organized in accordance with its founding Declaration of Trust and its By-Laws, to which the Joint Powers Agreement is an Exhibit CAMP Board of Trustees is comprised of five government finance directors, treasurers and executive directors. Board of Trustees meets quarterly; meetings are open to the public
CAMP has no full-time employees; Trustees employ service providers to serve as custodian to CAMP’s funds and to handle all administrative operations of the Trust Investment activity is subject to CAMP’s Investment Policy, which adheres to CA Government Code 53600, to which CPA's Investment Policy also adheres Funds held at CAMP are considered government agency deposits and are subject to California’s the Local Agency Protection Program
Agenda Page 31 of 83
CAMP Investment Pools
Agenda Page 32 of 83
© 2022 California Asset Management Program
CALIFORNIA ASSET
MANAGEMENT TRUST
DECLARATION
OF TRUST
Dated as of December 15, 1989, as amended and restated as of October 25, 2022 Agenda Page 33 of 83
-i-Table of Contents
ARTICLE I. DEFINITIONS..............................................................................................2 ARTICLE II. NAME, PURPOSE AND REPRESENTATIONS .......................................4 Section 2.1. Name. ...................................................................................................4 Section 2.2. Purpose.................................................................................................4 Section 2.3. Representations of Participants and Investors. ......................................4 ARTICLE III. TRUSTEES .................................................................................................4 Section 3.1. Initial Trustees.......................................................................................4 Section 3.2. Number, Qualification, Election and Term of Trustees.........................5 Section 3.3. Resignation and Removal. .....................................................................5 Section 3.4. Vacancies. .............................................................................................5 ARTICLE IV. POWERS OF TRUSTEES ..........................................................................6 Section 4.1. General. ................................................................................................6 Section 4.2. Investments...........................................................................................6 Section 4.3. Legal Title. ............................................................................................6 Section 4.4. Issuance and Redemption of Shares. .....................................................7 Section 4.5. Borrowing Money and Lending Trust Property. ....................................7 Section 4.6. Delegation and Committees. .................................................................7 Section 4.7. Collection and Payment.........................................................................7 Section 4.8. Expenses and Limits Thereon. ..............................................................7 Section 4.9. Litigation...............................................................................................7 Section 4.10. Manner of Acting and By-Laws. ..........................................................8 Section 4.11. Miscellaneous Powers..........................................................................8 ARTICLE V. INVESTMENT ADVISORY AND OTHER SERVICES TO
TRUST ...................................................................................................8 Section 5.1. Investment Adviser and Approval of Agreements. ................................8 Section 5.2. Other Activities of Investment Adviser. ................................................9 Agenda Page 34 of 83
-ii-Section 5.3. Other Services to the Trust. ..................................................................9 ARTICLE VI. LIMITATIONS OF LIABILITY...............................................................10 Section 6.1. No Personal Liability...........................................................................10 Section 6.2. Non-Liability and Indemnification of Trustees and Others. ................10 Section 6.3. Surety Bond Required. ........................................................................10 Section 6.4. No Duty of Investigation and Notice in Trust Instruments.................10 Section 6.5. Reliance on Experts.............................................................................11 Section 6.6. Immunity from Liability, Limited Waiver of Sovereign Immunity of Certain Participants. ...................................................11 Section 6.7. Further Restriction of Duties and Liabilities........................................11 ARTICLE VII. SHARES OF BENEFICIAL INTEREST................................................11 Section 7.1. Beneficial Interest................................................................................11 Section 7.2. Rights of the Shareholders...................................................................12 Section 7.3. Establishment of a Trust. ....................................................................12 Section 7.4. Register of Shares................................................................................12 Section 7.5. Transfer of Shares. ..............................................................................13 Section 7.6. Notices................................................................................................13 Section 7.7. Approval Powers.................................................................................13 Section 7.8. Series and Classes of Shares.................................................................13 ARTICLE VIII. REDEMPTIONS....................................................................................15 Section 8.1. Redemptions. ......................................................................................15 Section 8.2. Suspension of Right of Redemption....................................................15 Section 8.3. Redemptions to Reimburse Trust for Loss on Nonpayment for Shares or for Other Charges. .....................................................15 Section 8.4. Redemptions Pursuant to Constant Net Asset Value Policy. ...............16 Section 8.5. Redemptions in Kind. .........................................................................16 Section 8.6. Minimum Investment..........................................................................16 Agenda Page 35 of 83
-iii-ARTICLE IX. DETERMINATION OF NET ASSET VALUE, NET
INCOME AND DISTRIBUTIONS ....................................................16 Section 9.1. By-Laws to Govern Net Asset, Net Income and Distribution Procedures. .................................................................16 ARTICLE X. DURATION, TERMINATION AND AMENDMENT............................16 Section 10.1. Duration............................................................................................16 Section 10.2. Termination of Trust.........................................................................17 Section 10.3. Amendment Procedure. ....................................................................17 Section 10.4. Merger, Consolidation and Sale of Assets. .........................................18 ARTICLE XI. MISCELLANEOUS ..................................................................................18 Section 11.1. Governing Law..................................................................................18 Section 11.2. Counterparts. ....................................................................................18 Section 11.3. Adoption by California Public Agencies. ...........................................18 Section 11.4. Certificates. .......................................................................................18 Section 11.5. Provisions in Conflict with Law or Regulations. ................................19 Section 11.6. Index and Headings for Reference Only............................................19 Section 11.7. Successors in Interest. .......................................................................19 Agenda Page 36 of 83
1 THIS DECLARATION OF TRUST, made as of December 15, 1989, by the Initial Participants, is amended and restated as of October 25, 2022. Capitalized terms used herein shall have the meanings specified in Article I.
WITNESSETH
WHEREAS, Section 6502 of the Act provides that “if authorized by their legislative or other governing bodies, two or more public agencies by agreement may jointly exercise any power common to the contracting parties”; and
WHEREAS, Section 6509.7(a) of the Act provides that “two or more public agencies that have the authority to invest funds in their treasuries may, by agreement, jointly exercise that common power”; and
WHEREAS, Section 6500 of the Act defines “Public Agency” to include “the federal government or any federal department or agency, this state, another state or any state department or agency, a county, county board of education, county superintendent of schools, city, public corporation, public district, regional transportation commission of this state or another state, a federally recognized Indian tribe, or any joint powers authority formed pursuant to this article by any of these agencies”; and WHEREAS, Section 6509.7(b) of the Act provides that in addition to those public agencies listed in Section 6500, the definition of “Public Agency” also includes “a nonprofit corporation whose membership is confined to public agencies or public officials”; and WHEREAS, the Initial Participants are both California Public Agencies and are both authorized to invest funds pursuant to the Government Code of the State of California; and WHEREAS, the Initial Participants have been authorized by their legislative or other governing bodies, and desire to agree by this Declaration of Trust, to jointly exercise their common power to invest funds through creation of the Trust as a separate entity under the Act; and WHEREAS, the Initial Participants anticipate that other California Public Agencies as defined by the Act, as it may be amended from time to time, may wish to become Participants by adopting and executing this Declaration of Trust and thus becoming parties to it; and WHEREAS, Section 6509.7(a) of the Act provides that Public Agencies’ funds invested pursuant to an agreement entered into under the Act may be invested as authorized under subdivision (p) of Section 53601 of the California Government Code (“Section 53601"); and WHEREAS, Section 53601 of the California Government Code, subdivision (p), makes shares of beneficial interest issued by the Trust eligible investments for Public Agencies; and WHEREAS, Public Agencies that do not wish to become parties to this Declaration of Trust, but that wish to acquire Shares of Beneficial Interest issued by the Trust, may do so on terms provided hereunder and in accordance with the By-Laws governing the Trust.
NOW, THEREFORE, the Initial Participants hereby declare that all money and property contributed to the Trust established under this Declaration of Trust shall be held and managed in trust for Agenda Page 37 of 83
2 the benefit of holders, from time to time, of the Shares of Beneficial Interest issued hereunder and subject to the provisions hereof.
ARTICLE I. DEFINITIONS
Except as otherwise expressly provided for in this Declaration of Trust, or unless the context otherwise requires, as used throughout this Declaration of Trust the following terms shall have the respective meanings specified below.
Act: The Joint Exercise of Powers Act, Section 6500 et seq. of Title 1, Division 7, Chapter 5 of the Government Code of the State of California.
Affiliate: As to any person, any other person who owns beneficially, directly or indirectly, 1% of the outstanding capital stock or equity interest of such person or of any other person who controls, is controlled by or is under common control with such person, or is an officer, retired officer, director, employee, partner or Trustee of such person or of any other person who controls, is controlled by or is under common control with such person.
By-Laws: The By-Laws of the Trust made as of December 15, 1989, as amended and restated from time to time.
Cash Reserve Portfolio: A short-term money market portfolio of the Trust which is divided into two Series of Shares, the Participant Shares Series and the Investor Shares Series.
Certificate of Determination: An instrument, a copy of which is attached hereto as Exhibit A and incorporate by reference here, which has been approved by a majority of the Trustees establishing a Class or Series of Shares of a particular Class and setting forth therein the relative rights, preferences, approval powers, and terms and conditions of each Series or Class, as may be provided in such instrument.
Class. The designation of Shares issued by the Trust which currently includes two classes known as the “Cash Reserve Portfolio Class of Shares” and the “Term Portfolio Class of Shares.” Declaration of Trust: The Declaration of Trust made as of December 15, 1989, by the Initial Participants, as amended and restated as of October 25, 2022.
Information Statement: A disclosure document which describes in detail the management, policies and operations of the Pool, risks attendant to investments in the Trust, and other matters related to the Trust and the Pool.
Initial Participants: Monterey Peninsula Water Management District and Placer County.
Investment Advisory Agreement: The Amended and Restated Investment Advisory Agreement made as of May 14, 2004, by and between the Trust and PFM Asset Management LLC, as further amended and restated from time to time, and last amended and restated as of January 1, 2023.
Investor Agreement. An agreement entered into between the Investor and the Trust in connection with the Investor’s purchase of shares of Investor Shares Series.
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3 Investor Shares Series: Shares in the Trust held by Investors. Shares of Investor Shares Series have no voting rights.
Investors: Public Agencies that acquire Shares of Investor Shares Series issued by the Trust without executing the Declaration of Trust and on such other terms as provided in the Declaration of Trust and By-Laws.
Participant Shares Series: Shares in the Trust held by Participants. Shares of Participant Shares Series have voting rights conferring approval powers in proportion to the number of full and fractional Shares held by each Participant.
Participants: Initial Participants and any subsequent Participants that are Public Agencies that join the Trust by executing the Declaration of Trust and who may acquire shares of Participant Shares Series.
Program Guide. Information consisting of the Information Statement and additional information provided to Investors and Participants in the Trust.
Public Agency: As that term is defined in Section 6500 and Section 6509.7 of the Act.
Series: Subdivision of Shares within a Class. Each Series has rights, privileges, preferences and restrictions applicable to that Series as more fully set forth in a Certificate of Determination with respect to such Series.
The Shares issued by the Trust within the Cash Reserve Portfolio Class of Shares are currently designated into two Series, the Participant Shares Series and Investor Shares Series. The Shares issued by the Trust within the Term Portfolio Class of Shares are from time to time designated into a Series, and each such Series is designated into two Subseries, the Participant Shares Subseries and the Investor Shares Subseries.
Shareholders: Public Agencies that own Shares of a Class within the Trust or a Series within a Class.
Shares: Units of beneficial interests issued by the Trust and generally refers to shares of any one or more Series or Classes, or of all Series and Classes, as may apply.
Term Portfolio: A fixed-rate, fixed-term money market portfolio of the Trust , and each Series designated therein, each such Series constituting a pool of assets for purposes of Section 53601. Each such Series is divided into two Subseries of Shares, the Participant Shares Subseries and the Investor Shares Subseries.
Trust: The California Asset Management Trust formed pursuant to Section 6502 of the Act.
Trustees: Individuals appointed by the Board of Trustees and approved by Participants pursuant to the Declaration of Trust and By-Laws to manage the Trust’s activities on behalf of the Trust. So for as may be practicable, the Trustees shall conduct the Trust’s activities, execute all documents and sue or be sued under that name, which name (and the word “Trust” wherever used herein) shall refer to the Trustees as Trustees, and not as individuals or personally, and shall not refer to the officers, employees, agents or Participants of the Trust. If the Trustees determine that the use of that name is not advisable, they may use another designation or adopt another name under which the Trust may hold property or conduct its activities.
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4 ARTICLE II. NAME, PURPOSE AND REPRESENTATIONS
Section 2.1. Name.
The name of the trust created hereby is CALIFORNIA ASSET MANAGEMENT TRUST. The Trust shall constitute a separate public entity within the meaning of Section 6507 of the Act.
Section 2.2. Purpose.
The purpose of the Trust is to provide California Public Agencies, both the Participants and the Investors, with an instrumentality or agency to pool their proceeds of debt issues and other funds and to facilitate the investment of and accounting for such funds. Public Agencies of the State of California, authorized under the Act, as may be amended from time to time, or other applicable California statutes, as shall be in effect from time to time, to enter into joint arrangements of this nature, may become Participants after their governing bodies have adopted and executed this Declaration of Trust. Investors may invest in the Shares of the Trust without becoming Participants by executing an Investor Agreement containing the representations and warranties, waivers, covenants and agreements referenced herein as applicable to the Investors.
Section 2.3. Representations of Participants and Investors.
Each Participant and each Investor (by execution of an Investor Agreement), represents and warrants to the other Participants and Investors, but only as to itself, as follows:
(a) The Shareholder is duly organized and validly existing as a Public Agency of the State of California, as that term is defined in Sections 6500 and 6509.7(b) of the Act, as may be amended from time to time, and has full legal right, power and authority to enter into this Declaration of Trust or the Investor Agreement, as may be applicable, to observe and perform its obligations hereunder or thereunder and to invest its assets as provided herein or therein; and by all necessary official actions the Shareholder has duly authorized and approved the execution of this Declaration of Trust or the applicable Investor Agreement, as the case may be, the observance and performance of its obligations hereunder or thereunder and the investment of its assets as provided herein or therein. (b) This Declaration of Trust with respect to each Participant and Investor Agreement with respect to each Investor constitutes a legal, valid and binding obligation of the Shareholder enforceable against the Shareholder in accordance with its respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or limiting creditors rights generally, and by the application of equitable remedies in appropriate cases.
ARTICLE III. TRUSTEES
Section 3.1. Initial Trustees.
By the execution of this Declaration of Trust, the Initial Participants appoint the following five individuals to serve as initial Trustees:
Bruce Buel
Earl Corin
Nancy E. Hicks
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5 James S. Kennedy
Robert C. Leland
Section 3.2. Number, Qualification, Election and Term of Trustees.
The number of Trustees shall be fixed from time to time by resolution of the Trustees; provided, however, that the number of Trustees shall not be less than three and not greater than fifteen and shall not be less than the number of classes of California Public Agencies entitled to representation on the Board of Trustees as provided in the By-Laws. All Trustees shall be members of the governing body, officers or full-time employees of California Public Agencies. Other than the initial Trustees and Trustees named to fill vacancies as provided in Section 3.4., the Trustees shall be appointed by the Board of Trustees and approved annually by the Participants. Except in the event of resignations or removals pursuant to Section 3.3., each Trustee shall hold office until his or her successor is appointed and approved by the Board of Trustees and the Participants and qualified to serve as Trustee. Each Trustee shall either sign this Declaration of Trust or agree in writing to be bound by it.
Section 3.3. Resignation and Removal.
Any Trustee may resign his or her trust (without need for prior or subsequent accounting) by an instrument in writing signed by such Trustee and delivered to the other Trustees, and such resignation shall be effective upon such delivery, or at a later date according to the terms of the instrument. A Trustee who has ceased to be qualified as provided in the By-Laws, who has died, who has been judged incompetent or bankrupt, or for whom a guardian or conservator has been appointed, shall be deemed to have resigned as of the date of such disqualification, death, adjudication or appointment. Any Trustee may be removed, with or without cause, by the action of two-thirds of the remaining Trustees. Upon the resignation or removal of a Trustee, such former Trustee shall execute and deliver such documents as the remaining Trustees shall require for the purpose of conveying to the Trust or the remaining Trustees any Trust property held in the name of the resigning or removed Trustee. Upon the incapacity or death of any Trustee, his or her legal representative shall execute and deliver such documents as the remaining Trustees shall require as provided in the preceding sentence.
The Superior Court of the City and County of San Francisco, California, may at the suit of any Participants holding at least 10% of the Shares, remove from office any Trustee in case of fraudulent or dishonest acts or gross abuse of authority or discretion with reference to the Trust and may bar from reelection any Trustee so removed for a period determined by the Court.
Section 3.4. Vacancies.
The term of office of a Trustee shall terminate and a vacancy shall occur in the event of the disqualification, death, resignation, removal, bankruptcy, adjudicated incompetence or other incapacity to perform the duties of the office of a Trustee. No such vacancy shall operate to annul this Declaration of Trust or to remove any existing agency created pursuant to the terms of this Declaration of Trust. In the case of an existing vacancy, including a vacancy existing by reason of an increase in the number of Trustees, the remaining Trustees shall fill such vacancy by the appointment of such other person as they in their discretion shall see fit and as is qualified as provided herein and in the By-Laws. If there shall be no remaining Trustee, any Participant may petition the Superior Court of the City and County of San Francisco to appoint a Trustee who is qualified as provided herein and by the By-Laws. Any such appointment shall not become effective, however, until the person appointed shall have accepted in writing such appointment and agreed in writing to be bound by the terms of this Declaration of Trust. An appointment of a Trustee may be made in anticipation of a vacancy to occur at a later date by reason of Agenda Page 41 of 83
6 resignation, provided that such appointment shall not become effective prior to such resignation.
Whenever a vacancy in the number of Trustees shall occur, until such vacancy is filled as provided in this Section 3.4., the Trustees in office, regardless of their number, shall have all the powers granted to the Trustees and shall discharge all the duties imposed upon the Trustees by this Declaration of Trust.
ARTICLE IV. POWERS OF TRUSTEES
Section 4.1. General.
The Trustees shall have exclusive and absolute control over the Trust property and over the affairs of the Trust to the same extent as if the Trustees were the sole owners of the Trust property in their own right, but with such powers of delegation as may be permitted by this Declaration of Trust. The Trustees shall have power to conduct the affairs of the Trust and carry on its operations in any and all of its branches and maintain offices both within and without the State of California, and to do all such other things and execute all such instruments as the Trustees deem necessary, proper or desirable in order to promote the interests of the Trust although such things are not herein specifically mentioned. Any determination as to what is in the interests of the Trust made by the Trustees in good faith shall be conclusive. In construing the provisions of this Declaration of Trust, the presumption shall be in favor of a grant of a power to the Trustees. The enumeration of any specific power herein shall not be construed as limiting the aforesaid powers. Such powers of the Trustees may be exercised without order of or resort to any court.
Notwithstanding the foregoing, the investment powers of the Trustees under this Declaration of Trust shall be subject to any restrictions upon the manner of exercising such powers imposed by the laws of the State of California, including Section 53635 of Title 5, Division 7, Part 1, Chapter 4, Article 2 of the Government Code, as in effect on the date of adoption of this Declaration of Trust by the Initial Participants and as may be amended from time to time. In the event that such Initial Participants (or any successor Participants designated as described below) cease to be parties to this Declaration of Trust, the Trustees shall designate other Participants as successor Participants for purposes of this Section.
Section 4.2. Investments.
The Trustees shall have the power to subscribe for, invest in, reinvest in, purchase or otherwise acquire, own, hold, pledge, sell, assign, transfer, exchange, distribute, lend or otherwise deal in or dispose of investments of every nature and kind, provided such investment is (in the sole and absolute discretion of the Trustees) consistent with the investment objectives and policies set forth in the Trust’s Program Guide including the Information Statement, as most recently amended or supplemented, and to exercise any and all rights, powers and privileges of ownership or interest in respect of any and all such investments of every kind and description, including without limitation, the right to consent and otherwise act with respect thereto, with power to designate one or more persons, firms, associations or corporations to exercise any of such rights, powers and privileges in respect of any of such investments.
Section 4.3. Legal Title.
Legal title to all the Trust property shall be vested in the Trustees as joint tenants, except that the Trustees shall have power to cause legal title to any Trust property to be held by or in the name of one or more of the Trustees, or in the name of the Trust, or in the name of any other person as nominee, on such terms as the Trustees may determine, provided that the interest of the Trust therein is appropriately protected. The right, title and interest of the Trustees in the Trust property shall vest automatically in each person who may hereafter become a Trustee. Upon the resignation, removal, incapacity, disqualification or death of a Trustee such Trustee shall automatically cease to have any right, title or interest in any of the Agenda Page 42 of 83
7 Trust property, and the right, title and interest of such Trustee in the Trust property shall vest automatically in the remaining Trustees. Such vesting and cessation of title shall be effective whether or not conveyancing documents have been executed and delivered.
Section 4.4. Issuance and Redemption of Shares.
The Trustees shall have the power to issue, sell, repurchase, redeem, retire, cancel, acquire, hold, resell, reissue, dispose of, transfer, and otherwise deal in Shares and, subject to the provisions hereof, to apply to any such repurchase, redemption, retirement, cancellation or acquisition of Shares any funds or property of the Trust, whether capital or surplus or otherwise, to the full extent now or hereafter permitted by California law.
Section 4.5. Borrowing Money and Lending Trust Property.
Subject to applicable law, the Trustees shall have power to borrow money or otherwise obtain credit and to secure the same by mortgaging, pledging or otherwise subjecting as security the assets of the Trust, to endorse, guarantee, or undertake the performance of any obligation, contract or engagement of any other person and to lend Trust property.
Section 4.6. Delegation and Committees.
The Trustees shall have power to delegate from time to time to such of their number or to officers, employees or agents of the Trust the doing of such things and the execution of such instruments either in the name of the Trust or the names of the Trustees or otherwise as the Trustees may deem expedient, to the same extent as such delegation is permitted by law and consistent with the By-Laws.
Section 4.7. Collection and Payment.
The Trustees shall have power to collect all property due to the Trust; to pay all claims, including taxes, against the Trust property; to prosecute, defend, compromise or abandon any claims relating to the Trust property; to foreclose any security interest securing any obligation by virtue of which any property is owed to the Trust; and to enter into releases, agreements and other instruments.
Section 4.8. Expenses and Limits Thereon.
The Trustees shall have the power to incur and pay any expenses which in the opinion of the Trustees are necessary or incidental to carry out any of the purposes of this Declaration of Trust. The Trustees shall fix the compensation of all officers and employees who are not Trustees.
Section 4.9. Litigation.
The Trustees shall have the power to engage in and to prosecute, defend, compromise, abandon, or adjust, by arbitration or otherwise, any actions, suits, proceedings, disputes, claims, and demands relating to the Trust or the Trust property, and, out of the Trust property, to pay or to satisfy any debts, claims or expenses incurred in connection therewith, including those of litigation, and such power shall include without limitation the power of the Trustees or any appropriate committee thereof, in the exercise of their or its good faith business judgment, consenting to dismiss any action, suit, proceeding, dispute, claim, or demand, derivative or otherwise, brought by any person, including a Participant or an Investor in such Participant’s or Investor’s own name or in the name of the Trust, whether or not the Trust or any of the Agenda Page 43 of 83
8 Trustees may be named individually therein or the subject matter arises by reason of business for or on behalf of the Trust.
Section 4.10. Manner of Acting and By-Laws.
Except as otherwise provided herein or in the By-Laws, any action to be taken by the Trustees may be taken by a majority of the Trustees present at a meeting of Trustees (a quorum being present). The Trustees may adopt By-Laws not inconsistent with this Declaration of Trust to provide for the conduct of the affairs of the Trust and may amend or repeal such By-Laws.
Section 4.11. Miscellaneous Powers.
The Trustees shall have the power to: (a) employ or contract with such persons as the Trustees may deem desirable for the transaction of the affairs of the Trust; (b) to the extent permitted by law, enter into joint ventures, partnerships and any other combinations or associations; (c) remove Trustees or fill vacancies in or add to their number, elect and remove such officers and appoint and terminate such agents or employees as they consider appropriate, and appoint from their own number and others, and terminate, any one or more committees which may exercise some or all of the power and authority of the Trustees as the Trustees may determine; (d) purchase, and pay for out of Trust property, insurance policies insuring the Trustees, officers, employees, agents, Participants, investment advisers, distributors, or independent contractors of the Trust against all claims arising by reason of holding any such position or by reason of any action taken or omitted by any such person in such capacity, whether or not constituting negligence, or whether or not the Trust would have the power to indemnify such person against such liability; (e) to the extent permitted by law, indemnify any person with whom the Trust has dealings to such extent as the Trustees shall determine; (f) determine and change the fiscal year of the Trust and the method by which its accounts shall be kept; and (g) adopt a seal for the Trust but the absence of such seal shall not impair the validity of any instrument executed on behalf of the Trust.
In addition to these specific powers, the Trustees shall also have all other powers consistent with the Act and the laws of California governing California business trusts and reasonably necessary from time to time to carry out the purposes of the Trust as set forth in Section 2.2.
ARTICLE V. INVESTMENT ADVISORY AND OTHER SERVICES TO TRUST Section 5.1. Investment Adviser and Approval of Agreements.
The Trustees are responsible for the general policies of the Trust and for such general supervision of the business of the Trust conducted by all officers, agents, employees, advisers, managers or independent contractors of the Trust as may be necessary to insure that such business conforms to the provisions of this Declaration of Trust. However, the Trustees shall not be required personally to conduct all the business of the Trust, and consistent with their ultimate responsibility as stated above, the Trustees shall have the power to appoint, employ or contract with any person (including one or more of themselves or any corporation, partnership, or Trust in which one or more of them may be directors, officers, stockholders, partners or trustees) as the Trustees may deem necessary or proper for the transaction of the business of the Trust. The Trustees may in their discretion, from time to time, enter into an investment advisory or management contract whereby the other party to such contract shall undertake to furnish the Trust such management, investment advisory or supervisory, administrative, accounting, legal, statistical, research, and promotional facilities and services, and such other facilities and services, if any, as the Trustees may in their discretion determine. The Trustees may authorize the investment adviser to effect Agenda Page 44 of 83
9 purchases, sales, loans or exchanges of portfolio securities of the Trust on behalf of the Trustees or may authorize any officer, employee or Trustee to effect such purchases, sales, loans or exchanges pursuant to recommendations of the investment adviser, all without further action by the Trustees. Any such purchases, sales, loans and exchanges shall be deemed to have been authorized by all of the Trustees.
The Trustees shall have the power to determine the compensation and other terms of employment or contract of the investment adviser or any other person whom they may employ or with whom they may contract; provided, however, that any determination to employ or contract with any Trustee or any person of which a Trustee is an Affiliate, shall be valid only if made, approved or ratified by a majority of the Trustees who are not Affiliates of such person. The Trustees may exercise broad discretion in allowing the investment adviser to administer and regulate the operations of the Trust, to act as agent for the Trust, to execute documents on behalf of the Trustees, and to make decisions which conform to general policies and general principles previously established by the Trustees.
Section 5.2. Other Activities of Investment Adviser.
Subject to and as limited by the terms and conditions of any Investment Advisory Agreement or other agreement between the Trust and the investment advisor, the investment adviser shall not be required to administer the investment activities of the Trust as its sole and exclusive function and may have other business interests and may engage in other activities similar or in addition to those relating to the Trust, including the rendering of services and advice to other persons and the management of other investments (including investments of the investment adviser and its Affiliates).
The investment adviser shall be required to use its best efforts to present a continuing and suitable investment program to the Trust which is consistent with the investment policies and objectives of the Trust.
Section 5.3. Other Services to the Trust.
The Trustees may, from time to time in their discretion, enter into contracts or agreements with independent contractors to carry out the following functions: (l) transfer agent and dividend disbursing agent; (2) administrator, to maintain the books and records of the Trust, to supervise all aspects of the Trust’s operations, including periodic updating of the Trust’s Program Guide and Information Statement, to prepare the Trust’s tax returns and periodic reports to Shareholders, to compute the Trust’s daily net asset value and yield, to provide office space, equipment and facilities necessary for the Trust’s operations and to provide such other administrative services as the Trustees may require; (3) distributor, to act as the Trust’s sales agent for the distribution of the Shares, (4) customer service agent, to provide information to California Public Agencies which are Participants or Investors or are interested in becoming Participants or Investors; (5) custodian bank, to hold all money and securities constituting the Trust property; (6) independent certified public accountants, to perform an annual audit and provide such other services as the Trustees may require, and (7) legal counsel. The foregoing specific list shall not prevent the Trustees from employing other persons to provide such advice, assistance or services as the Trustees may, from time to time, require to carry out the purposes of the Trust as set forth in Section 2.2.
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10 ARTICLE VI. LIMITATIONS OF LIABILITY
Section 6.1. No Personal Liability.
No Participant shall be subject to any personal liability whatsoever to any person in connection with the Trust property or the acts, obligations or affairs of the Trust. Subject to Section 6.2., no Trustee, officer, employee or agent of the Trust shall be subject to any personal liability whatsoever to any person in connection with Trust property or the acts, obligations or affairs of the Trust, and all such persons shall look solely to the Trust property for satisfaction of claims of any nature arising in connection with the affairs of the Trust. No Participant, Trustee, officer, employee, or agent, as such, of the Trust, made a party to any suit or proceeding to enforce any such liability, shall be held to any personal liability. The Trust shall indemnify and hold each Participant harmless from and against all claims and liabilities to which such Participant may become subject by reason of its being or having been a Participant and shall reimburse such Participant for all legal and other expenses reasonably incurred by it in connection with any such claim or liability; provided that such indemnity or reimbursement shall be made from assets (or proceeds thereof or income therefrom) of the one or more Series of Shares of the Trust in respect of which such claim or liability arose and not from the assets (or proceeds or income therefrom) of any other Series of Shares of the Trust. The rights accruing to a Participant under this Section 6.1. shall not exclude any other right to which such Participant may be lawfully entitled, nor shall anything herein contained restrict the right of the Trust to indemnify or reimburse a Participant in any appropriate situation even though not specifically provided herein.
Section 6.2. Non-Liability and Indemnification of Trustees and Others.
No Trustee, officer, employee or agent of the Trust shall be liable to the Trust, to its Shareholders, or to any Participant, Trustee, officer, employee or agent thereof for any action or failure to act (including, without limitation, the failure to compel, in any way, any former or acting Trustee to redress any breach of trust), except for its, his or her own bad faith, willful misfeasance, gross negligence or reckless disregard of duty. Each Trustee, officer, employee and agent of the Trust shall be indemnified as provided in the By-Laws and to the fullest extent provided by California law.
Section 6.3. Official Bond Required.
The Trustees shall obtain an official bond in such amounts and with such terms as they shall determine pursuant to Section 6505.1 of Title 1, Division 7, Chapter 5 of the Government Code of the State of California.
Section 6.4. No Duty of Investigation and Notice in Trust Instruments.
No purchaser, lender, transfer agent or other person dealing with the Trustees or any officer, employee or agent of the Trust shall be bound to make any inquiry concerning the validity of any transaction purporting to be made by the Trustees or by such officer, employee or agent or be liable for the application of money or property paid, loaned, or delivered to or on the order of the Trustees or of such officer, employee or agent. Every obligation, contract, instrument, certificate, Share or other security of the Trust and undertaking, and every other document executed in connection with the Trust, shall be conclusively presumed to have been executed or done by the executors thereof only in their capacity as Trustees under this Declaration of Trust or in their capacity as officers, employees or agents of the Trust.
Every written obligation, contract, instrument, certificate, Share or other security of the Trust or undertaking made or issued by the Trustees shall recite that it is executed by them not individually, but as Trustees under this Declaration of Trust, and that the obligations of any such instruments are not binding Agenda Page 46 of 83
11 upon any of the Trustees or Participants individually, but bind only the Trust property, but the omission of such recital shall not operate to bind the Trustees or Participants individually.
Section 6.5. Reliance on Experts.
Each Trustee, officer and employee of the Trust shall, in the performance of his or her duties, be fully protected with regard to any act or any failure to act resulting from reliance in good faith upon the books of account or other records of the Trust, upon an opinion of counsel, or upon reports made to the Trust by any of its officers or employees or by the investment adviser, administrator, transfer agent, custodian, distributor accountants, appraisers or other experts or consultants selected with reasonable care by the Trustees, officers or employees of the Trust.
Section 6.6. Immunity from Liability, Limited Waiver of Sovereign Immunity of Certain Participants.
All of the privileges and immunities from liability, all exemptions from laws, ordinances and rules, and all pension, relief, disability, workmen’s compensation, and other benefits which apply to the activity of Trustees, officers, agents or employees of the Initial Participants and any additional Participants when performing their functions within the territorial limits of their respective Public Agencies, shall apply to them to the same degree and extent while engaged in the performance of any of their functions and duties associated with the Trust; provided however, that notwithstanding the foregoing, any Participant that is a federally recognized Indian tribe agrees (a) to a limited waiver of its sovereign immunity solely for the purpose of authorizing another Participant or Participants, including the Trustees, to initiate an action against it to enforce any right under the Declaration of Trust, to seek provisional remedies and to enforce an award or judgment rendered in any such action; and (b) to waive its sovereign immunity from any liability or judgment arising from any such action, but any such waiver shall be limited to and co-extensive with the immunity afforded a Participant that is a California Public Agency but not a federally recognized Indian tribe. The Trust, acting through one or more service providers, with the consent of the Board President, shall be authorized to negotiate and to enter into agreements with federally recognized Indian tribes on behalf of the Trust consistent with the above waivers as required to address terms and conditions.
Section 6.7. Further Restriction of Duties and Liabilities.
Without limiting the foregoing provisions of this Article VI, the Trustees, officers, employees, agents, and Participants of the Trust shall in no event have any greater duties or liabilities than those imposed by applicable law as shall be in effect from time to time.
ARTICLE VII. SHARES OF BENEFICIAL INTEREST
Section 7.1. Beneficial Interest.
The interest of the Shareholders hereunder shall be divided into transferable units to be called Shares. The number of Shares authorized hereunder is unlimited. Except as otherwise provided in this Section 7.1. and in Section 7.8. hereof, each Share shall represent an equal proportionate interest in the net assets of the applicable pool of securities within the Trust. Each Share of any Class of Shares created by the Trustees, whether or not the Trustees have created more than one Series of Shares of such Class, shall represent an equal proportionate interest in the assets of that Class with each other Share in that Class.
The Trustees may divide or combine the Shares of any Class into a greater or lesser number of Shares of Agenda Page 47 of 83
12 that Class or any Series of that Class without thereby changing the proportionate interests of each Share of that Class in the assets of that Class.
There is hereby established and designated two Classes of Shares known as the “Cash Reserve Portfolio” Class and the “Term Portfolio” Class. These Classes of Shares shall be divided into two Series of Shares, within the same portfolios, a “Participant Shares Series” and an “Investor Shares Series.” Subject to the provisions of Section 7.8. hereof, the Trustees may authorize the creation of additional Classes of Shares (the proceeds of which may be invested in other portfolios with investment objectives different from the “Cash Reserve Portfolio” Class and the “Term Portfolio” Class) and such series of Shares of such additional Classes as the Trustees may deem appropriate. All Shares issued hereunder, including, without limitation, Shares issued in connection with a dividend in Shares or a division of Shares, shall be fully paid and nonassessable. Except as expressly provided herein, or in the action of the Trustees in creating any new Series of a Class, no division of Shares into Series shall result in the creation of a preference as to dividends or distributions or a preference in the event of any liquidation, termination or winding up of the Trust. All references to Shares in this Declaration of Trust shall be deemed to be Shares of any one or more Series or Classes, or of all Series and Classes, as the context may require.
Section 7.2. Rights of the Shareholders.
The ownership of the Trust property of every description and the right to conduct the affairs of the Trust herein before described are vested exclusively in the Trustees, and the Shareholders shall have no interest therein other than the beneficial interest conferred by their Shares, and they shall have no right to call for any partition, division, dividend or distribution of any property, profits, rights or interests of the Trust nor can they be called upon to assume any losses of the Trust or suffer an assessment of any kind by virtue of their ownership of the Shares beyond their beneficial interests in the Shares. The Shares shall be personal property giving only the rights specifically set forth in this Declaration of Trust. The Shares shall not entitle the holder to preference, preemptive, appraisal, conversion or exchange rights, except as the Trustees may determine.
Section 7.3. Establishment of a Trust.
It is the intention of the Trustees and the Shareholders to create the relationship of Trustee and beneficiary between the Trustees and each Shareholder from time to time. It is not the intention of the Trustees and the Shareholders to create a general partnership, limited partnership, joint stock association, corporation, bailment or any form of legal relationship other than a trust. Nothing in this Declaration of Trust shall be construed to make the Shareholders, either by themselves or with the Trustees, partners or members of a partnership or a joint stock association.
Section 7.4. Register of Shares.
A register shall be kept at the principal office of the Trust or at such place as the Trustees shall designate containing the names and addresses of all the Shareholders and the number of Shares held by them respectively and a record of all transfers thereof. Such register shall be conclusive as to which California Public Agencies are the holders of the Shares and which California Public Agencies shall be entitled to receive distributions or otherwise to exercise or enjoy the rights of Participants or Investors.
No Shareholder shall be entitled to receive payment of any distribution, nor to have rights given to it as herein or in the By-Laws provided, until its correct name and address has been given to the transfer agent or such other officer or agent of the Trustee as shall keep the register. The Trustees, in their discretion, may but need not authorize the issuance of Share certificates and promulgate appropriate rules and regulations as to their use.
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13 Section 7.5. Transfer of Shares.
Shares shall be transferable on the records of the Trust only by the record holder thereof or by its agent thereunto duly authorized in writing, upon delivery to the transfer agent of a duly executed instrument of transfer, together with such evidence of the genuineness of each such execution and authorization and of other matters as may reasonably be required. Upon such delivery the transfer shall be recorded on the register of the Trust. Until such record is made, the Shareholder of record shall be deemed to be the holder of such Shares for all purposes hereunder and neither the Trustees nor any transfer agent nor any officer, employee or agent of the Trust shall be affected by any notice of the proposed transfer. No Shares may be transferred to a transferee other than a California Public Agency or the Trust itself. Any attempted transfer to any other person shall be void and of no effect.
Section 7.6. Notices.
Any and all notices and communications to which a Shareholder may be entitled shall be deemed duly given or made if delivered in person, by email or other electronic communication with respect to which a record of delivery of the notice shall be obtained and maintained, or mailed, postage prepaid, addressed to the Shareholder of record at its address as recorded on the register of the Trust. In addition to any other notice or communication to which a Shareholder may be entitled, each Shareholder shall be entitled to notice of any amendment to this Declaration of Trust or of any matter which is approved by the Participants.
Section 7.7. Approval Powers.
The following matters taken by the Trustees shall require the approval of a majority of the holders of outstanding voting Shares: (i) the appointment of Trustees as provided in Section 3.2., (ii) liquidation of any Class of Shares or Participant Shares Series as provided in Section 7.8.(e), (iii) termination of the Trust as provided in Section 10.2., (iv) amendment of this Declaration of Trust to the extent provided in Section 10.3., (v) merger, consolidation or sale of assets of the Trust as provided in Section 10.4., (vi) a change in the investment restrictions or fundamental policies set forth in the Program Guide and Information Statement, except as set forth therein, and (vii) such additional matters relating to the Trust as may be required by this Declaration of Trust or the By-Laws or as the Trustees may consider necessary or desirable. Only Participants shall be entitled to exercise such approval powers in proportion to the number of full and fractional Shares held by each Participant. Investors shall have no voting rights.
Shares shall not be cumulated for the purpose of approving Trustees. Until Shares are issued, the Trustees may exercise all rights of the Participants and may take any action required by law, this Declaration of Trust or the By-Laws to be taken by the Participants. The By-Laws may include further provisions for the approval of the Participants and related matters.
Section 7.8. Series and Classes of Shares.
The following provisions are applicable regarding the Series or Classes of Shares of the Trust established and designated by Section 7.1. hereof and shall be applicable if the Trustees shall establish and designate additional Classes or Series of a Class as provided in that Section:
(a) The number of Shares of each Series or Class that may be issued shall be unlimited. (b) All consideration received by the Trust for the issue or sale of Shares of a particular Class (whether or not Shares of such Class have been divided into Series), together with all assets in which such Agenda Page 49 of 83
14 consideration is invested or reinvested, all income, earnings, profits and proceeds thereof, including any proceeds derived from the sale, exchange or liquidation of such assets, and any funds or payments derived from reinvestment of such proceeds in whatever form the same may be, shall irrevocably belong to Shares of that Class for all purposes, subject only to the rights of creditors, and shall be so recorded upon the hooks of account of the Trust. In the event that there are any assets, income, earnings, profits, or proceeds thereof, or funds or payments of the Trust which are not readily identifiable as belonging to any particular Class, the Trustees shall allocate them among any one or more of the Classes established and designated from time to time in such manner and on such basis as they, in their sole discretion, deem fair and equitable.
Each such allocation by the Trustees shall be conclusive and binding upon the Shareholders of all Classes for all purposes.
(c) The assets belonging to each particular Class shall be charged with the liabilities of the Trust in respect of that Class, as will all expenses, costs, charges and reserves attributable to that Class, and any general liabilities, expenses, costs, charges or reserves of the Trust which are not readily identifiable as belonging to any particular Class shall be allocated and charged by the Trustees to and among any one or more of the Classes established and designated from time to time in such manner and on such basis as the Trustees in their sole discretion deem fair and equitable. Each allocation of liabilities, expenses, costs, charges and reserves by the Trustees shall be conclusive and binding upon the Shareholders in all Classes for all purposes.
(d) Except as otherwise provided in the Certificate of Determination of the Trustees creating a Series of Shares of a particular Class, all dividends and distributions on Shares of a particular Class shall be distributed pro rata to the holders of that Class in proportion to the number of Shares of that Class held by such holders at the date and time of record established in the By-Laws for the payment of such dividends or distributions.
(e) In the event of the liquidation of a particular Series of a Class or of an entire Class, the Participants or Investors in that Series or Class, as the case may be, which is being liquidated shall be entitled to receive, when and as declared by the Trustees, the excess of the assets belonging to Shares of that Class over the liabilities attributable to Shares of the Class. The holders of Shares of any such Class shall not be entitled thereby to any distribution upon liquidation of any other Series or Class. The assets so distributable to the Participants or Investors, as the case may be, in any Class shall be distributed among such Participants or Investors in proportion to the number of Shares of that Class, whether in one or more Series, held by them and recorded on the books of the Trust. The liquidation of any particular Series or Class in which there are Shares then outstanding held by Participants may be authorized by an instrument in writing, without a meeting, signed by a majority of the Trustees then in office, subject to the affirmative vote of a majority of the outstanding voting Shares of that Series or Class held by Participants. (f) The Trustees shall have the authority to provide that the holders of Shares of any Series or Class shall have the right to convert or exchange such Shares for or into Shares of one or more other Series or Class in accordance with such requirements and procedures as may be established by the Trustees. (g) The Trustees shall have the power to determine the designations, preferences, privileges, limitations and rights, including approval and dividend rights, of each Series or Class of Shares. Subject to the provisions of this Section 7.8., all Shares of all Series or Classes shall have identical rights and privileges.
(h) The establishment and designation of any Series or Class of Shares in addition to those established and designated in Section 7.1. hereof shall be effective upon the execution by a majority of the then Trustees of an instrument setting forth such establishment and designation and the relative rights, Agenda Page 50 of 83
15 preferences, approval powers, restrictions, limitations as to dividends, qualifications, and terms and conditions of redemption of such Series or Class or as otherwise provided in such instrument. At any time that there are no Shares outstanding of any particular Series or Class previously established and designated, the Trustees may by an instrument executed by a majority of their number abolish that Series or Class and the establishment and designation thereof. Each instrument referred to in this paragraph shall constitute an amendment to this Declaration of Trust.
ARTICLE VIII. REDEMPTIONS
Section 8.1. Redemptions.
In case any Shareholder at any time desires to dispose of its Shares, it may deposit a written request or other such form of request as the Trustees may from time to time authorize, at the office of the transfer agent or at the office of any bank or trust company, either in or outside of California which is a member of the Federal Reserve System and which the transfer agent has designated in writing for that purpose, to have the Shares redeemed by the Trust at the net asset value thereof per Share next determined after such deposit as provided in the By-Laws. Payment for redemption shall be made to the Shareholder within the number of business days specified in the Trust’s current Program Guide and Information Statement, unless the date of payment is postponed pursuant to Section 8.2. hereof, in which event payment may be delayed beyond such period.
Section 8.2. Suspension of Right of Redemption.
The Trustees may declare a suspension of the right of redemption or postpone the date of payment or redemption for the whole or any part of any period (i) during which the New York Stock Exchange is closed other than customary weekend and holiday closings, (ii) during which trading on the New York Stock Exchange is restricted, or (iii) during which an emergency exists as a result of which disposal by the Trust of securities owned by it is not reasonably practicable or it is not reasonably practicable for the Trust fairly to determine the value of its net assets. Such suspension shall take effect at such time as the Trustees shall specify, but not later than the close of business on the business day next following the declaration of suspension, and thereafter there shall be no right of redemption or payment on redemption until the Trustees shall declare the suspension at an end, except that the suspension shall terminate in any event on the first day on which the New York Stock Exchange shall have reopened or the period specified in (ii) or (iii) shall have expired (as to which the determination of the Trustees shall be conclusive). In the case of a suspension of the right of redemption, a Shareholder may either withdraw its request for redemption or receive payment based on the net asset value existing after the termination of the suspension.
Section 8.3. Redemptions to Reimburse Trust for Loss on Nonpayment for Shares or for Other Charges.
The Trustees shall have the power to redeem Shares owned by any Shareholder to the extent necessary (i) to reimburse the Trust for any loss it has sustained by reason of the failure of such Shareholder to make full payment for Shares purchased by such Shareholder, or (ii) to collect any charge relating to a transaction effected for the benefit of such Shareholder which is applicable to Shares as provided in the Program Guide and Information Statement. Any such redemption shall be effected at the redemption price determined in accordance with Section 8.1. hereof.
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16 Section 8.4. Redemptions Pursuant to Constant Net Asset Value Policy.
The following provisions shall apply to any Series, or multiple Series of a Class or Classes of Shares invested in the same portfolio, of investments of the Trust during any period that the Trustees, in their discretion, establish a policy of maintaining a constant net asset value per Share. If for any reason the net income of the Trust attributable to such Shares invested in the same portfolio shall, at the time of any determination thereof in accordance with Section 9.1. hereof, be a negative amount, then the Trustees shall have power to cause the number of outstanding Shares of such Series or multiple Series of a Class or Classes of Shares invested in the same portfolio to be reduced by requiring each Shareholder to contribute to the capital of the Trust such Shareholder’s proportionate part of the total number of Shares which have an aggregate current net asset value equal as nearly as may be practicable to the amount of the Trust’s net loss in respect of such portfolio. Each Shareholder, by becoming a registered holder of Shares, agrees to make any such contribution which may be required.
Section 8.5. Redemptions in Kind.
Payment for Shares redeemed pursuant to Section 8.1. may, at the option of the Trustees, or such officer or officers as they may duly authorize for the purpose, in their complete discretion be made in cash, or in kind, or partially in cash and partially in kind. In case of payment in kind, the Trustees, or their delegate, shall have absolute discretion as to what security or securities shall be distributed in kind and the amount of the same, and the securities shall be valued for purposes of distribution at the figure at which they were appraised in computing the net asset value of the Shares.
Section 8.6. Minimum Investment.
The Trustees shall have the power to fix the minimum investment for Shareholders expressed in dollars or Shares, or both. Whenever a Shareholder’s investment is less than the minimum established by the Trustees, the Trustees may redeem the Shares of such Shareholder, provided thirty days prior notice is given to such Shareholder. If the Trustees increase the minimum investment to an amount greater than it was at the time of the investment of any Shareholder, the investment of such Shareholder shall not be redeemed solely because it is less than such minimum amount without such Shareholder’s consent.
ARTICLE IX. DETERMINATION OF NET ASSET VALUE, NET INCOME AND
DISTRIBUTIONS
Section 9.1. By-Laws to Govern Net Asset, Net Income and Distribution Procedures.
The Trustees, in their absolute discretion, may prescribe and shall set forth in the By-Laws such bases and times for determining the per Share net asset value of Class of the Shares that is a separate pool, the net income of the Trust, and the declaration and payment of distributions, as they may deem necessary or desirable. If authorized by the By-Laws such provisions may be set forth in the Information Statement.
ARTICLE X. DURATION, TERMINATION AND AMENDMENT
Section 10.1. Duration.
The Trust shall continue without limitation of time but subject to the provisions of this Article X.
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17 Section 10.2. Termination of Trust.
(a) The Trust may be terminated by the vote of the majority of the authorized Trustees, subject to approval of the holders of not less than two-thirds of the holders of outstanding voting Shares. Upon the termination of the Trust:
(i) The Trust shall carry on no activities except for the purpose of winding up its affairs; (ii) The Trustees shall proceed to wind up the affairs of the Trust and all of the powers of the Trustees under this Declaration of Trust shall continue until the affairs of the Trust shall have been wound up, including the power to fulfill or discharge the contracts of the Trust, collect its assets, sell, convey, assign, exchange, transfer or otherwise dispose of all or any part of the Trust property to one or more persons at public or private sale for consideration which may consist in whole or in part of cash, securities or other property of any kind, discharge or pay its liabilities, and do all other acts appropriate to liquidate its business; provided that any sale, conveyance, assignment, exchange, transfer or other disposition of all or substantially all the Trust property shall require approval in accordance with Section
10.4. hereof; and
(iii) After paying or adequately providing for the payment of all liabilities, and upon receipt of such releases, indemnities and refunding agreements as they deem necessary for their protection, the Trustees may distribute the remaining Trust property, in cash or in kind or partly in cash and partly in kind, among the Shareholders according to their respective beneficial interests. (b) After termination of the Trust and distribution to the Shareholders as herein provided, a majority of the Trustees shall execute and lodge among the records of the Trust an instrument in writing setting forth the fact of such termination, and the Trustees shall thereupon be discharged from all further liabilities and duties hereunder, and the rights and interests of all Shareholders shall thereupon cease.
Section 10.3. Amendment Procedure.
(a) This Declaration of Trust may be amended by the vote of the Trustees, subject to approval of such amendment by the holders of a majority of outstanding voting Shares. The Trustees may also amend this Declaration of Trust without such approval to change the name of the Trust or any Series or Class, to establish and designate additional Series or Classes, to supply any omission herein or to correct or supplement any ambiguous, defective or inconsistent provision hereof, or if they deem it necessary, to conform this Declaration of Trust to the requirements of applicable laws or regulations, or to eliminate or reduce any taxes which may be payable by the Trust or the Shareholders, but the Trustees shall not be liable for failing to do so.
(b) No amendment may be made under this Section 10.3. which would change any rights with respect to any Share by reducing the amount payable thereon upon liquidation of the Trust, or by diminishing or eliminating any approval rights pertaining thereto, except with the vote of a majority of the Trustees and the approval of the holders of two-thirds of the outstanding voting Shares. Nothing in this Declaration of Trust shall permit its amendment to impair the exemption from personal liability of the Participants, Trustees, officers, employees and agents of the Trust or to permit assessments upon the Shareholders.
(c) A certificate signed by a majority of the Trustees setting forth an amendment and reciting that it was duly adopted by the Trustees and, if applicable, by the majority of the outstanding voting Shares, or Agenda Page 53 of 83
18 a copy of the Declaration of Trust as amended, and executed by a majority of the Trustees, shall be conclusive evidence of such amendment when lodged among the records of the Trust.
Section 10.4. Merger, Consolidation and Sale of Assets.
To the extent permitted by law, the Trust may merge into or consolidate with any other corporation, association, trust or other organization or may sell, lease or exchange all or substantially all of the Trust property, including its good will, upon such terms and conditions and for such consideration when and as authorized by vote of a majority of the Trustees and approved by the holders of two-thirds of the outstanding voting Shares.
ARTICLE XI. MISCELLANEOUS
Section 11.1. Governing Law.
This Declaration of Trust is executed by the Initial Participants and delivered in the State of California and with reference to the laws thereof, and the rights of all parties and the validity and construction of every provision hereof shall be subject to and consented according to the laws of the State of California.
Section 11.2. Counterparts.
This Declaration of Trust may be simultaneously executed in several counterparts, each of which shall be deemed to be an original, and such counterparts, together, shall be constituted one and the same instrument, which shall be sufficiently evidenced by any such original counterpart.
Section 11.3. Adoption by California Public Agencies.
A Public Agency of the State of California may become a Participant of this Trust by taking appropriate action to adopt this Declaration of Trust, furnishing the Trust with satisfactory evidence that such action has been taken, and signing a counterpart of this Declaration of Trust. A copy of this Declaration of Trust may be adopted through incorporation by reference into an ordinance or resolution of such Public Agency, and a certified copy of such ordinance or resolution shall constitute satisfactory evidence of adoption contemplated by this Section.
Section 11.4. Certificates.
Any certificate executed by an individual who, according to the records of the Trust, appears to be a Trustee hereunder, or Secretary or Assistant Secretary of the Trust, certifying to: (a) the number or identity of Trustees or Shareholders, (b) the due authorization of the execution of any instrument or writing, (c) the form of any vote passed at a meeting of Trustees, (d) the number of Trustees present or voting at any meeting, (e) the form of any By-Laws adopted by or the identity of any officers elected by the Trustees, or (f) the existence of any fact or facts which in any manner relate to the affairs of the Trust, shall be conclusive evidence as to the matters so certified in favor of any person dealing with the Trustees and their successors.
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19 Section 11.5. Provisions in Conflict with Law or Regulations. (a) The provisions of this Declaration of Trust are severable, and if the Trustees shall determine, with the advice of counsel, that any of such provisions is in conflict with applicable laws and regulations, the conflicting provisions shall be deemed superseded by such laws or regulations to the extent necessary to eliminate such conflict; provided, however, that such determination shall not affect any of the remaining provisions of this Declaration of Trust or render invalid or improper any action taken or omitted prior to such determination.
(b) If any provision of this Declaration of Trust shall be held invalid or unenforceable, such invalidity or unenforceability shall pertain only to such provision and shall not in any manner affect any other provision of this Declaration of Trust in any jurisdiction.
Section 11.6. Index and Headings for Reference Only.
The index and headings preceding the text, articles and sections hereof have been inserted for convenience and reference only and shall not be construed to affect the meaning, construction or effect of this Declaration of Trust.
Section 11.7. Successors in Interest.
This Declaration of Trust and the By-Laws shall be binding upon and inure to the benefit of the undersigned Initial Participants and their successors and assigns, and every Shareholder and its successors and assigns.
IN WITNESS WHEREOF, the undersigned have executed this Declaration of Trust as of the date first herein above set forth.
MONTEREY PENINSULA WATER PLACER COUNTY
MANAGEMENT DISTRICT
By: /s/ Dick Heuer By: /s/ Alex Ferreira
Name: Dick Heuer Name: Alex Ferreira
Title: Chairman Title: Chairman, Board of Supervisors
The undersigned Public Agency hereby represents that the governing body of the undersigned has duly adopted by appropriate action the Declaration of Trust of the California Asset Management Trust dated as of December 15, 1989, as amended and restated as of October 25, 2022; hereby executes such Declaration of Trust and, by such execution, hereby becomes a party to and Participant of the Trust and agrees to be bound by all the provisions of the Declaration of Trust.
Date:
Public Agency:
By:
Name:
Title: _______________________________________
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EXHIBIT A
AMFENDED AND RESTATED CERTIFICATE OF DETERMINATION
OF CALIFORNIA ASSET MANAGEMENT TRUST
(PARTICIPANT SHARES SERIES AND INVESTOR SHARES SERIES OF THE CASH
RESERVE PORTFOLIO CLASS AND THE TERM PORTFOLIO CLASS)
We, the undersigned Trustees of the California Asset Management Trust (“Trust”), a California Joint Exercise of Powers Authority, formed pursuant to Section 6500 of the Joint Exercise of Powers Act, Title 1, Division 7, Chapter 5 of the Government of the State of California, and a common law trust established under a Declaration of Trust dated as of December 15, 1989, as amended and restated as of February 28, 2005 (“Declaration of Trust”) (capitalized terms used herein, unless otherwise provided, have the meaning assigned in the Declaration of Trust), do hereby adopt the following:
WHEREAS, the Declaration of Trust authorizes the Trustees to divide the shares of beneficial interest (“Shares”) into any number of Classes and Series of Classes and determine the rights, preferences, privileges and restrictions granted to or imposed upon any of the such Classes or Series of Classes of Shares; and
WHEREAS, the Declaration of Trust authorizes two Series of Shares of the Cash Reserve Portfolio Class and the Term Portfolio Class, consisting of Participant Shares Series and Investor Shares Series with each Share representing an equal proportionate Share in the net assets of the Class; and WHEREAS, the Participant Share Series consists of Shares issued and outstanding to Participants in the Trust with rights, preference, privileges and restrictions as more fully set forth herein and in the Declaration of Trust and By-Laws; and
WHEREAS, the Trustees wish to designate the rights, preferences, privileges and restrictions of the Participant Shares Series and the Investor Share Series.
NOW, THEREFORE, BE IT RESOLVED, as follows:
(a) Participant Shares Series. The rights, preferences, privileges and restrictions granted to or imposed upon the Participant Shares Series are as follows:
1. Voting Rights. Except as otherwise expressly provided by law, the By-Laws as adopted as of December 15, 1989, as amended and restated as of October 25, 2022, (“By-Laws”), or the Declaration of Trust, Participant Shares have exclusive voting rights on the following matters: (a) the appointment of Trustees, (b) liquidation of any Participant Shares Series, or any Class of Shares held in whole or in part by Participants, (c) termination of the Trust, (d) amendment of the Declaration of Trust, (e) merger, consolidation or sale of assets of the Trust, (f) change in the investment restrictions or fundamental policies set forth in the Information Statement, and (g) such other matters relating to the Trust as may be required by the By-Laws or the Declaration of Trust or as the Trustees may consider necessary or desirable to obtain the approval of the holders of the Participant Shares Series; and
2. Dividends. The holders of the Participant Shares Series shall be entitled to receive dividends and distributions as may be determined by the Trustees, in accordance with the By-Laws and the Declaration of Trust, and all such dividends and distributions shall be distributed pro rata to each Agenda Page 56 of 83
A-2
holder of the Participant Shares Series in proportion to the number of Shares of the Participant Shares Series held by such holder at the date and time of record established by the By-Laws for the payment of such dividends and distributions; and
3. Liquidation. In the event of any liquidation of the Participant Shares Series of any Class, each holder of the Participant Shares Series shall be entitled to receive, when and as declared by the Trustees in accordance with the By-Laws and the Declaration of Trust, the net asset value of each Share of the Participant Shares Series held by the Participant. The holders of the Participant Shares Series shall not be entitled to any distribution upon liquidation of any other Series of any Class. The assets so distributable to the holders of the Participant Shares Series shall be distributed in proportion to the number of Shares of the Participant Shares Series of such Class held by each holder and recorded on the books of the Trust; and
4. Redemption. The holder of the Participant Shares Series shall have the right at any time to redeem Shares of the Participant Shares Series at the net asset value per Share with payment for the Shares of the Participant Shares Series redeemed to be made by the Trustees to such holder either in cash or in kind or partially in cash and partially in kind, as may be determined by the Trustees, in their complete discretion, or by such officer or officers as the Trustees may duly authorize for this purpose.
RESOLVED, FURTHER,
(b) Investor Shares Series. The rights, preferences, privileges and restrictions granted to or imposed upon the Investor Shares Series are as follows:
1. Voting Rights. Except as otherwise expressly provided by law, the Investor Shares Series shall have no voting rights; and
2. Dividends. The holders of the Investor Shares Series of a Class of Shares shall be entitled to receive dividends and distributions as may be determined by the Trustees, in accordance with the By-Laws and the Declaration of Trust, and all such dividends and distributions shall be distributed pro rata to each holder of the Investor Shares Series of such Class in proportion to the number of Shares of the Investor Shares Series held by such holder at the date and time of record established by the By-Laws for the payment of such dividends and distributions; and
3. Liquidation. In the event of any liquidation of the Investor Shares Series of a Class, each holder of the Investor Shares Series of such Class shall be entitled to receive, when and as declared by the Trustees, in accordance with the By-Laws and the Declaration of Trust, the net asset value of each share of the Investor Shares Series of such Class. The holders of the Investor Shares Series shall not be entitled to any distribution upon liquidation of any other Series. The assets so distributable to the holders of the Investor Shares Series of a Class shall be distributed in proportion to the number of Shares of the Investor Shares Series held by each holder and recorded on the books of the Trust; and
4. Redemption. The holder of the Investor Shares Series of a Class shall have the right at any time to redeem Shares of the Investor Shares Series of such Class at the net asset value per Share with payment for the Shares of the Investor Shares Series redeemed to be made by the Trustees to such holder either in cash or in kind or partially in cash and partially in kind, as may be determined by the Trustees, in their complete discretion, or by such officer or officers as the Trustees may duly authorize for this purpose.
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VERIFICATIONS BY WRITTEN DECLARATION OF
AMENDED AND RESTATED CERTIFICATE OF DETERMINATION
Steve Dial declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ Steve Dial
Name: Steve Dial
Karen Adams declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ Karen Adams
Name: Karen Adams
André Douzdjian declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ André Douzdjian
Name: André Douzdjian
Duane Wolterstorff declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ Duane Wolterstorff
Name: Duane Wolterstorff
Agenda Page 58 of 83
A-4
Lauren Warrem declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ Lauren Warrem
Name: Lauren Warrem
Jordan Kaufman declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ Jordan Kaufman
Name: Jordan Kaufman
David Persselin declares under penalty of perjury under the laws of the State of California that he has read the foregoing Amended and Restated Certificate and knows the contents thereof and that the same is true of his own knowledge.
Dated: October 25, 2022
By: /s/ David Persselin
Name: David Persselin
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ONE CALIFORNIA STREET
SUITE 1000
SAN FRANCISCO
CALIFORNIA 94111
213 MARKET STREET
HARRISBURG
PENNSYLVANIA 17101
PHONE (800) 729-7665
FAX (888) 535-0120
www.camponline.com
CAMP® is a registered trademark and the CAMP logos and designs are trademarks owned by the California Asset Management Trust (Trust).
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AMENDED AND RESTATED BY-LAWS OF
CALIFORNIA ASSET MANAGEMENT TRUST
A California Joint Exercise of Powers Authority and Common Law Trust Established Under a Declaration of Trust
Dated as of December 15, 1989, as amended and restated as of October 25, 2022
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-i-TABLE OF CONTENTS
Page
ARTICLE I. GENERAL.................................................................................................................1 Section 1. Principal Offices. .....................................................................................................................................1 Section 2. Other Offices. ..........................................................................................................................................1 Section 3. Definitions. ..............................................................................................................................................1 ARTICLE II. SHAREHOLDERS ..................................................................................................1 Section 1. Action By Participants. ............................................................................................................................1 Section 2. Record Date. ............................................................................................................................................1 Section 3. Inspection of Records. .............................................................................................................................2 ARTICLE III. TRUSTEES.............................................................................................................2 Section 1. Public Agency Representation on the Board of Trustees.........................................................................2 Section 2. Disqualification of Persons as Trustees. ..................................................................................................2 Section 3. Meetings of the Trustees..........................................................................................................................2 Section 4. Quorum and Manner of Acting................................................................................................................3 Section 5. Procedure for Filling Vacancies on the Board of Trustees. .....................................................................3 ARTICLE IV. COMMITTEES OF TRUSTEES............................................................................4 Section 1. Executive and Other Committees. ...........................................................................................................4 Section 2. Meetings, Quorum and Manner of Acting...............................................................................................5 ARTICLE V. OFFICERS...............................................................................................................5 Section 1. General Provisions...................................................................................................................................5 Section 2. Terms of Office and Qualifications. ........................................................................................................5 Section 3. Removal...................................................................................................................................................5 Section 4. Powers and Duties of the President. ........................................................................................................5 Section 5. Powers and Duties of the Vice Presidents. ..............................................................................................5 Section 6. Powers and Duties of the Treasurer. ........................................................................................................6 Section 7. Powers and Duties of the Secretary. ........................................................................................................6 Section 8. Powers and Duties of the Assistant Treasurers........................................................................................6 Section 9. Powers and Duties of the Assistant Secretaries. ......................................................................................6 Section 10. Compensation of Officers; Reimbursement for Expenses. ....................................................................6 ARTICLE VI. CONTRACTS, CHECKS AND DRAFTS.............................................................7 Section 1. Contracts..................................................................................................................................................7 Section 2. Checks and Drafts....................................................................................................................................7 ARTICLE VII. FISCAL YEAR .....................................................................................................7 ARTICLE VIII. SEAL....................................................................................................................7 ARTICLE IX. ADMINISTRATIVE SERVICES ..........................................................................7 Section 1. Custodian. ................................................................................................................................................7 Section 2. Other Administrative Services.................................................................................................................7 Section 3. Central Certification System....................................................................................................................8 Section 4. Acceptance of Receipts in Lieu of Certificates........................................................................................8 ARTICLE X. INDEMNIFICATION AND INSURANCE ............................................................8 Section 1. Indemnification of Trustees and Officers. ...............................................................................................8 Agenda Page 62 of 83
-ii-Section 2. Indemnification of Employees and Agents..............................................................................................9 Section 3. Right of Trustees and Officers to Bring Suit. ..........................................................................................9 Section 4. Successful Defense. .................................................................................................................................9 Section 5. Nonexclusivity of Rights. ......................................................................................................................10 Section 6. Insurance................................................................................................................................................10 Section 7. Expenses as a Witness. ..........................................................................................................................10 Section 8. Indemnity Agreements...........................................................................................................................10 Section 9. Severability............................................................................................................................................10 Section 10. Effect of Repeal or Modification. ........................................................................................................10 ARTICLE XI. ISSUANCE OF SHARES ....................................................................................11 ARTICLE XII. NET ASSET VALUE OF SHARES ...................................................................11 ARTICLE XIII. DIVIDENDS AND DISTRIBUTIONS .............................................................11 ARTICLE XIV. AMENDMENTS ...............................................................................................11 ARTICLE XV. LIMITATION OF LIABILITY ..........................................................................12 Agenda Page 63 of 83
1 BY-LAWS
OF THE
CALIFORNIA ASSET MANAGEMENT TRUST
(Dated as of December 15, 1989, as amended and restated as of October 25, 2022) A California Joint Exercise of Powers Authority and Common Law Trust established under a Declaration of Trust dated as of December 15, 1989 (as amended and restated as of October 25, 2022 (the “Declaration of Trust”) ARTICLE I. GENERAL
Section 1. Principal Offices.
Until changed by the Trustees, the principal office of the Trust shall be co-located at One California Street, Suite 1000, San Francisco, California 94111, and 213 Market Street, Harrisburg, Pennsylvania 17101. Each such location shall be considered a principal office of the Trust for all purposes, including, but not limited to, determining the location for the conduct of meetings of the Trustees.
Section 2. Other Offices.
The Trust may have offices in such other places without as well as within the State of California as the Trustees may from time to time determine.
Section 3. Definitions.
Unless otherwise stated herein, capitalized terms have the meanings assigned by the Declaration of Trust, as amended from time to time.
ARTICLE II. SHAREHOLDERS
Section 1. Action By Participants.
Any action which may be taken by the Participants may be taken if a majority of the outstanding voting securities of the Class or Series, as may be applicable, entitled to vote thereon (or such larger proportion thereof as shall be required by law, the Declaration of Trust, or these By-Laws for approval of such matter) consent to the action in writing and the written consents are filed with the records of the Trust. Prompt notice shall be given of any Trust action approved by the Participants by less than unanimous written consent to those Participants who did not consent in writing to such action.
Section 2. Record Date.
For the purpose of determining the Shareholders entitled to participate in any distribution, or for the purpose of any other action, the Trustees shall fix a date not more than sixty (60) days prior to the date of any distribution or other action as a record date for the determination of the Shareholders of record for such purposes.
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2 Section 3. Inspection of Records.
The records of the Trust shall be open to inspection by the Shareholders at any time during usual business hours of the Trust, upon written demand on the Trust, for a purpose reasonably related to such Shareholder’s interest as a Shareholder.
ARTICLE III. TRUSTEES
Section 1. Public Agency Representation on the Board of Trustees.
At least one of the Trustees shall be either a member of the governing body, an officer or a full-time employee of a California Public Agency of each of the following classes:
(a) A county; and
(b) A city; and
(c) A public district or other public or sovereign entity, including a Joint Powers Authority and a federally recognized Indian tribe; provided, however, that a Public Agency of such class has become and remains a Participant of the Trust.
In the event that there is a vacancy in any class of Public Agency entitled to representation on the Board of Trustees, the Trustees shall fill such vacancy as soon as practicable. During such vacancy, the Trustees shall continue to have all the powers granted to the Trustees, and no action by the Trustees shall be invalidated by such vacancy.
By resolution duly adopted by a majority of the Trustees, the Trustees may designate additional classes of Public Agencies as being entitled to representation on the Board of Trustees. The Trustees may designate a class of Public Agencies as being entitled to representation on the Board of Trustees if at least one member of the class has become a Participant of the Trust. The number of classes shall in no event exceed the maximum number of Trustees established under Section 3.2 of the Declaration of Trust.
Section 2. Disqualification of Persons as Trustees.
No person who is an affiliate of the Trust’s investment adviser, administrator, distributor, custodian, or any other agency shall serve as Trustee of the Trust. If a Trustee ceases to be a member of the governing body, officer or full-time employee of a California Public Agency that is a Participant, the Trustee shall no longer be qualified to serve on the Board of Trustees and the position shall be deemed to be vacant.
Section 3. Meetings of the Trustees.
The Trustees may in their discretion provide for regular meetings of the Trustees. Notice of regular meetings need not be given if the time and place of such meetings are fixed in advance by the Board of Trustees. Meetings of Trustees other than regular meetings may be called by the President or by a majority of the Trustees. Notice of the time and place of each special meeting shall be given by the Secretary or an Assistant Secretary or by the Trustees calling the meeting Agenda Page 65 of 83
3 and shall be mailed to each Trustee at least four days before the meeting, or delivered personally to such person at least 48 hours before the meeting. Notice of a special meeting need not be given to any Trustee if a written waiver of notice, executed by such person at or prior to the meeting, is filed with the Secretary, or to any Trustee who attends the meeting. A notice or waiver of notice of a special meeting must specify the purpose of the meeting. The agenda of any regular meeting shall be posted at least 72 hours prior to the regular meeting, and the notice and agenda of any special meeting shall be posted at least 24 hours prior to the special meeting, in a location that is freely accessible to members of the public. All meetings of the Trustees shall be open and public, except as permitted by California Government Code Sections 54950 et seq. (the “Brown Act”). All meetings of the Trustees shall be conducted in accordance with the Brown Act.
Section 4. Quorum and Manner of Acting.
A majority of the Trustees shall be present in person or by audio or video teleconference at any regular or special meeting of the Trustees in order to constitute a quorum for the transaction of business at such meeting, and (except as otherwise required by law, the Declaration of Trust, or these By-Laws) the act of a majority of the Trustees present at any such meeting, at which a quorum is present, shall be the act of the Trustees. The Trustees present at a duly called meeting at which a quorum is initially present may continue to do business notwithstanding the withdrawal of Trustees, provided any action taken is approved by at least a majority of the required quorum for such meeting. In the absence of a quorum, a majority of the Trustees present may adjourn the meeting to a time and place specified in the order of adjournment. A copy of the order of adjournment shall be conspicuously posted on or near the door of the place where the meeting was held within 24 hours after the time of adjournment.
Section 5. Procedure for Filling Vacancies on the Board of Trustees.
By resolution duly adopted by a two-thirds vote by the full Board of Trustees, the Trustees shall establish and may revise the number of Trustees suitable to manage the Trust under the then-current operating environment, provided, however, that the number of Trustees shall be not less than three and not greater than fifteen and shall not be less than the number of classes of California Public Agencies entitled to representation on the Board of Trustees as set forth in Section 1 of this Article III. In the event that there is a change in the operating environment, the Trustees shall, by resolution duly adopted by a two-thirds vote of the full Board of Trustees, modify the number of Trustees as they deem appropriate. The number of Trustees shall be an odd number.
Every two (2) years a notice shall be disseminated to the Participants indicating that the Trust is soliciting letters of interest from individuals to join the Board of Trustees. A list of the individuals that have submitted a letter of interest, and each submitted letter of interest, shall be maintained for the two (2) year period subsequent to the dissemination of such notification. In the event that there is a vacancy on the Board of Trustees, the Trustees shall fill that vacancy by considering persons who have satisfied the following selection criteria:
(a) Submission of a current letter of interest;
(b) Fiscal or Financial Officer of a Participant of the Trust; Agenda Page 66 of 83
4 (c) Officer of a Participant located in a then under-represented geographic region of California as defined below, if feasible; (d) Demonstration of an interest in the Trust by attending a meeting of the Board of Trustees; and
(e) Participation in an interview with a panel of the Trustees, to be established by an action of the Board of Trustees, (the “Candidate Review Panel”) and, based upon that interview, is recommended to the full Board as a suitable candidate.
Upon recommendation by the Candidate Review Panel, at the Trustees’ next regularly scheduled meeting, the Trustees will consider the recommendation and may appoint a new Trustee by the vote of the Trustees to serve pursuant to the conditions set forth in the By-Laws and Declaration of Trust. In the course of considering a recommendation from the Candidate Review Panel, the Trustees shall make a good faith effort to (i) create a geographic balance among the Trustees in regard to the number of Trustees from Participants located in Southern California, comprising of San Diego, Imperial, Riverside, Orange, Los Angeles, San Bernardino, Ventura, Kern, Santa Barbara, and San Luis Obispo Counties, and Participants located in Northern California, defined as the region comprised of all other counties in California; and (ii) provide for Trustee representation that reflects the diversity of agency size.
ARTICLE IV. COMMITTEES OF TRUSTEES
Section 1. Executive and Other Committees.
The Trustees by vote of a majority of all the Trustees may elect from their own number an Executive Committee to consist of not less than two (2) to hold office at the pleasure of the Trustees, which shall have the power to conduct the current and ordinary business of the Trust while the Trustees are not in session, including the purchase and sale of securities and such other powers of the Trustees as the Trustees may, from time to time, delegate to them, except those powers which by law, the Declaration of Trust, or these By-Laws they are prohibited from delegating and except with respect to (a) the approval of any action which also requires the approval of the Participants or any Class or Series of the Participants, (b) the filling of vacancies on the Board of Trustees or on any Committee, (c) the fixing of compensation of the Trustees, (d) the amendment of the By-Laws, (e) the amendment of any resolution of the Board of Trustees which by its terms is not so amendable, (f) a dividend or distribution to the Shareholders other than at a rate or in a periodic amount or price range determined by the Board of Trustees, and (g) the appointment of other Committees or the members thereof. The Trustees may also elect from their own number or other persons other Committees from time to time, the number composing such Committees, the powers conferred upon the same (subject to the same limitations as the Executive Committee), and the term of membership on such Committees to be determined by the Trustees. The Trustees may designate a Chairman of any such Committee. In the absence of such designation, the Committee may elect its own Chairman.
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5 Section 2. Meetings, Quorum and Manner of Acting.
Meetings and action of Committees shall be held and taken in accordance with the procedures for meetings of the Board of Trustees, except as otherwise provided by law, by the By-Laws or by resolution of the Board of Trustees. Each Committee shall keep regular minutes of its meetings and cause them to be recorded in a book designated for that purpose and kept in the office of the Trust.
ARTICLE V. OFFICERS
Section 1. General Provisions.
The officers of the Trust shall be a President, a Treasurer, and a Secretary, who shall be elected by the Trustees. The Trustees may elect or appoint such other officers or agents as the business of the Trust may require, including one or more Vice Presidents, one or more Assistant Secretaries and one or more Assistant Treasurers. The Trustees may delegate to any officer or Committee the power to appoint any subordinate officers or agents.
Section 2. Terms of Office and Qualifications.
Except as otherwise provided by law, the Declaration of Trust, or these By-Laws, all officers shall hold office at the pleasure of the Trustees. Any two or more offices may be held by the same person. The President, Vice-President and Treasurer shall all be Trustees. Any other officer may be, but none need be, a Trustee.
Section 3. Removal.
The Trustees, at any regular or special meeting of the Trustees, may remove any officer with or without cause. Any officer or agent appointed by any officer or Committee may be removed with or without cause by such appointing officer or Committee.
Section 4. Powers and Duties of the President.
The President shall be a Trustee. The President may call meetings of the Trustees and of any Committee thereof when such person deems it necessary and shall preside at all meetings of the Trustees. Subject to the control of the Trustees and any Committees of the Trustees, such person shall at all times exercise general supervision and direction over the affairs of the Trust.
The President shall have the power to employ such subordinate officers, employees, and agents, as such person may find necessary to transact the business of the Trust. Such person shall also have the power to grant, issue, execute or sign such powers of attorney, proxies, or other documents as may be deemed advisable or necessary in furtherance of the interests of the Trust.
The President shall also have such powers and duties as, from time to time, may be conferred upon or assigned to such person by the Trustees.
Section 5. Powers and Duties of the Vice Presidents.
In the absence or disability of the President, the Vice President, or if there be more than one Vice President any Vice President designated by the Trustees, shall perform all the duties and may exercise any of the powers of the President, subject to the control of the Trustees. Each Vice President shall perform such other duties as may be assigned to such person from time to time by the Trustees or the President.
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6 Section 6. Powers and Duties of the Treasurer.
The Treasurer shall be the principal financial and accounting officer of the Trust. Such person shall deliver all funds of the Trust which may come into such person’s hands to such custodian as the Trustees may employ pursuant to Article IX of these By-Laws. Such person shall render a statement of condition of the finances of the Trust to the Trustees as often as they shall require the same and such person shall in general perform all the duties incident to the office of the Treasurer and such other duties as from time to time may be assigned to such person by the Trustees. The Treasurer shall give a bond for the faithful discharge of such person’s duties in such sum and with such surety or sureties as the Trustees shall require. The Treasurer shall also perform the functions of depository and auditor or controller as specified in the Joint Exercise of Powers Act.
Section 7. Powers and Duties of the Secretary.
The Secretary shall keep the records of all action of the Participants in proper books provided for that purpose; such person shall have custody of the seal of the Trust; and such person shall have charge of the Share transfer books, lists, and records unless the same are in the charge of the Transfer Agent. Such person shall attend to the giving and serving of all notices by the Trust in accordance with the provisions of these By-Laws and as required by law. Such person shall keep the minutes of all meetings of the Trustees and Committees. Such person shall perform such other duties and have such other powers in addition to those specified in these By-Laws as the Trustees shall from time to time designate.
Section 8. Powers and Duties of the Assistant Treasurers.
In the absence or disability of the Treasurer, any Assistant Treasurer designated by the Trustees shall perform all the duties, and may exercise any of the powers, of the Treasurer. The Assistant Treasurers shall perform such other duties as from time to time may be assigned to them by the Trustees. Each Assistant Treasurer shall give a bond for the faithful discharge of such person’s duties, if required to do so by the Trustees, in such sum and with such surety or sureties as the Trustees shall require.
Section 9. Powers and Duties of the Assistant Secretaries.
In the absence or disability of the Secretary, any Assistant Secretary designated by the Trustees shall perform all of the duties, and may exercise any of the powers, of the Secretary.
The Assistant Secretaries shall perform such other duties as from time to time may be assigned to them by the Trustees.
Section 10. Compensation of Officers; Reimbursement for Expenses. The compensation of the officers shall be fixed from time to time by the Trustees or by any Committee or officer upon whom such power may be conferred by the Trustees. No Trustee shall be entitled to fixed compensation. The Trust may, however, advance to the Trustees and officers, or reimburse the Trustees and officers, or other persons on CAMP® official business upon approval of the Trustees, for all costs and expenses incurred in connection with attendance at meetings of the Trustees and Committee meetings.
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7 ARTICLE VI. CONTRACTS, CHECKS AND DRAFTS
Section 1. Contracts.
The Trustees may authorize any officer or agent to enter into any contract or to execute and deliver any instrument in the name and on behalf of the Trust, and such authority may be general or confined to specific instances. All contracts entered into on behalf of the Trust shall comply with Section 4.5 of the Declaration of Trust.
Section 2. Checks and Drafts.
All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the Trust shall be signed by such officer or officers or agent or agents of the Trust and in such manner as shall from time to time be determined by the Trustees.
ARTICLE VII. FISCAL YEAR
The fiscal year of the Trust shall begin on the first day of January in each year and shall end on the thirty-first day of December in each year, provided, however that the Trustees may from time to time change the fiscal year.
ARTICLE VIII. SEAL
The Trustees shall adopt a seal which shall be in such form and shall have such inscription thereon as the Trustees may from time to time prescribe.
ARTICLE IX. ADMINISTRATIVE SERVICES
Section 1. Custodian.
The Trustees shall at all times employ one or more banks or trust companies having a capital, surplus and undivided profits of at least one hundred million dollars ($100,000,000) as Custodian with authority as its agent, but subject to such restrictions, limitations or other requirements, if any, as may be contained in the Declaration of Trust. The Custodian shall constitute a “Depository” within the meaning of California Government Code Section 53630 or any successor provision. Except as otherwise provided herein, all moneys and all investment securities of the Trust shall be held by the Custodian at all times. The Custodian may act as transfer agent, disbursement agent, and agency for any other legal purposes not inconsistent with the Declaration of Trust.
Section 2. Other Administrative Services.
Subject to the provisions of the Declaration of Trust, the Trustees may employ one or more professional organizations to act as investment adviser, transfer agent, registrar, dividend disbursement agent, administrator, distributor, and customer servicing agent. It is contemplated that the Trust will have no full-time employees and that all administrative operations of the Trust will be carried out by such independent contractors, operating under service agreements with the Trust.
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8 Section 3. Central Certification System.
The Trustees may direct the Custodian to deposit all or any part of the securities owned by the Trust in a system for the central handling of securities established by a national securities exchange or a national association registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934, or such other person as may be permitted by that Commission, pursuant to which system all securities of a particular class or series of an issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of such securities, provided that all such deposits shall be subject to withdrawal only upon the order of the Trustees.
Section 4. Acceptance of Receipts in Lieu of Certificates.
The Trustees may direct the Custodian to accept written receipts or other written evidence indicating purchases of securities held in book-entry form in the Federal Reserve System in accordance with the regulations promulgated by the Board of Governors of the Federal Reserve System and the local Federal Reserve Banks in lieu of receipt of certificates representing such securities.
ARTICLE X. INDEMNIFICATION AND INSURANCE
Section 1. Indemnification of Trustees and Officers.
Each person who was or is a party or is threatened to be made a party to or is involved in any threatened, pending or completed action, suit or proceeding, formal or informal, whether brought in the name of the Trust or otherwise and whether of a civil, criminal, administrative or investigative nature (hereinafter, a “proceeding”), by reason of the fact that such person, or a person of whom such person is the legal representative, is or was a Trustee or officer of the Trust whether the basis of such proceeding is an alleged action or inaction in an official capacity or in any other capacity while serving as such a Trustee or officer, shall, subject to the terms of any agreement between the Trust and such person, be indemnified and held harmless by the Trust to the fullest extent permissible under applicable law and the Declaration of Trust, against all costs, charges, expenses, liabilities and losses (including, without limitation, attorneys’ fees, judgments, fines, and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith, and such indemnification shall continue as to a person who has ceased to be a Trustee or officer and shall inure to the benefit of such person’s heirs, executors and administrators; provided, however, that (a) the Trust shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Trustees of the Trust; (b) the Trust shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof), other than a proceeding by or in the name of the Trust to procure a judgment in its favor, only if any settlement of such a proceeding is approved in writing by the Trustees; (c) no such person shall be indemnified (i) except to the extent that the aggregate of losses to be indemnified exceeds the amount of such losses for which such person is paid pursuant to any trustees’, directors’ and officers’ liability insurance policy maintained by the Trust or (ii) if a court of competent jurisdiction finally determines that any indemnification hereunder is unlawful; and (d) no such person shall be indemnified with regard to any liability incurred by reason of such person’s willful misfeasance, bad faith, gross negligence or reckless disregard of duty. The right to indemnification conferred in this Section 1 shall be a contract Agenda Page 71 of 83
9 between the Trust and each person entitled to indemnification hereunder who serves in any capacity specified in this Section 1 at any time while these provisions are in effect, and any repeal or modification thereof shall not affect any right or obligation then existing with respect to any state of facts then or previously existing or any proceeding previously or thereafter brought or threatened based in whole or in part upon any such state of facts. Such a contract right may not be modified retroactively without the consent of such person. The right to indemnification conferred in this Section 1 shall include the right to be paid by the Trust expenses incurred in defending any proceeding in advance of its final disposition; provided, however, that such advances shall be made only upon delivery to the Trust of a written undertaking, by or on behalf of such Trustee or officer, to repay all amounts to the Trust if it shall be ultimately determined that such person is not entitled to be indemnified.
Section 2. Indemnification of Employees and Agents.
A person who was or is a party or is threatened to be made a party to or is involved in any proceeding by reason of the fact that such person is or was an employee or agent of the Trust, whether the basis of such proceeding is an alleged action or inaction in an official capacity or in any other capacity while serving as such an employee or agent, may, subject to the terms of any agreement between the Trust and such person, be indemnified and held harmless by the Trust to the fullest extent permitted under applicable law and the Declaration of Trust, against all costs, charges, expenses, liabilities and losses (including, without limitation, attorneys' fees, judgments, fines, and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith. The immediately preceding sentence is not intended to be and shall not be construed to confer a contract right on any such person (other than the persons referred to in Section 1 of this Article).
Section 3. Right of Trustees and Officers to Bring Suit.
If a claim under Section 1 of this Article is not paid in full by the Trust within 30 days after a written claim has been received by the Trust, the claimant may at any time thereafter bring suit against the Trust to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall also be entitled to be paid the expense of prosecuting such claim.
Neither the failure of the Trust (including its Board of Trustees, its independent legal counsel, or its Participants) to have made a determination prior to the commencement of such action that indemnification of the claimant is permissible in the circumstances because such person has met the applicable standard of conduct, if any, nor an actual determination by the Trust (including its Board of Trustees, its independent legal counsel, or its Participants) that the claimant has not met the applicable standard of conduct, shall be a defense to such action or create a presumption for the purposes of such action that the claimant has not met the applicable standard of conduct.
Section 4. Successful Defense.
Notwithstanding any other provision of this Article, to the extent that a person referred to in Section 1 of this Article has been successful on the merits or otherwise (including, without limitation, the dismissal of an action without prejudice or the settlement of a proceeding or action without admission of liability) in defense of any proceeding referred to in Section 1 of this Article or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including, without limitation, attorneys’ fees) actually and reasonably incurred in connection therewith.
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10 Section 5. Nonexclusivity of Rights.
The right to indemnification provided by this Article shall not be exclusive of nor limit any other right which any person may have or hereafter acquire under any statute, bylaw, agreement, action of the Participants or disinterested Trustees or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be such a Trustee, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person.
Section 6. Insurance.
The Trust may maintain insurance, at its expense, to protect itself and any Trustee, officer, employee or agent of the Trust against any expense, liability or loss asserted against such person or incurred by such person or arising out of such person’s status as such, whether or not the Trust would have the power to indemnify such person against such expense, liability or loss under applicable law, the Declaration of Trust or this Article. In addition to or in lieu of such insurance, the Trustees may create a fund or funds to secure such protection and may deposit moneys from the Trust property in such fund or funds from time to time in such amounts as the Trustees in their sole judgment may deem advisable.
Section 7. Expenses as a Witness.
To the extent that any Trustee, officer, employee or agent of the Trust is by reason of such position a witness in any proceeding, such person shall be indemnified against all costs and expenses actually and reasonably incurred by such person on such person’s behalf in connection therewith.
Section 8. Indemnity Agreements.
The Trust may enter into agreements with any Trustee, officer, employee or agent of the Trust providing for indemnification to the fullest extent permissible under applicable law and the Declaration of Trust.
Section 9. Severability.
Each and every paragraph, sentence, term and provision of this Article is separate and distinct so that if any paragraph, sentence, term or provision hereof shall be held to be invalid, unlawful or unenforceable for any reason, such invalidity, unlawfulness or unenforceability shall not affect the validity, lawfulness or enforceability of any other paragraph, sentence, term or provision hereof. To the extent required, any paragraph, sentence, term or provision of this Article may be modified by a court of competent jurisdiction to preserve its validity and to provide the claimant with, subject to the limitations set forth in this Article and any agreement between the Trust and such claimant, the broadest possible indemnification permitted under applicable law.
Section 10. Effect of Repeal or Modification.
Any repeal or modification of this Article shall not adversely affect any right of indemnification of a person referred to in Section 1 of this Article existing at the time of such repeal or modification with respect to any action or omission occurring prior to such repeal or modification.
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11 ARTICLE XI. ISSUANCE OF SHARES
The Trustees in their discretion may, from time to time without approval of the Shareholders, issue Shares of any Series or Class in addition to the then issued and outstanding Shares of such Series or Class to such party or parties and for consideration in such amount not less than the greater of the net asset value per Share (determined as set forth in Article XII hereof) and of such type, including cash or property, at such time or times and on such terms as the Trustees may deem fitting, and may in such manner acquire other assets (including the acquisition of assets subject to, and in connection with, the assumption of liabilities) and businesses. In connection with any issuance of Shares, the Trustees may issue fractional Shares.
Reductions in the number of outstanding Shares of any Series or Class with respect to which the Trustees shall have established a policy of maintaining a constant net asset value per Share of such Series or Class may be made pursuant to the provisions of Section 7.4 of the Declaration of Trust in order to maintain the constant net asset value per share of such Series or Class.
Contributions to the Trust may be accepted for, and Shares shall be redeemed as, whole Shares and fractions of a Share as described in the Information Statement.
ARTICLE XII. NET ASSET VALUE OF SHARES
Net asset value per Share shall be determined as of 11:00 a.m., Pacific Time, each day the Trust is open for business. For the purpose of calculating the net asset value per Share, the securities held shall be valued pursuant to the amortized cost method. The amortized cost method of valuation shall mean the acquisition cost as adjusted for the amortization of premiums or accumulation of discounts. The daily amount of premium to be amortized and the daily amount of discount to be accumulated shall be calculated by dividing the amount of the premium or discount, as determined at the time of acquisition of a security by the Trust, by the number of days remaining from the date of the security's acquisition by the Trust until the maturity date of the security.
ARTICLE XIII. DIVIDENDS AND DISTRIBUTIONS
The days on which the determination of the net income of each Share shall occur (each such day, a “Business Day”), the deadline during such Business Day for such determination, the declaration of such net income as a dividend, and the determination of the record date for Shareholders entitled to receive such dividend shall be as set forth in the Information Statement. The Information Statement shall also provide for the manner in which such dividend is to be paid, including whether such dividend is to be payable in additional Shares, and when such dividend shall be payable. The Information Statement shall provide for the manner in which such net income is to be calculated. Capital distributions, if any, may be made in the manner set forth in the Information Statement.
ARTICLE XIV. AMENDMENTS
These By-Laws, or any of them, may be altered, amended, or repealed, or new By-Laws may be adopted, by the Trustees. The Trustees shall in no event adopt By-Laws which are in conflict with the Declaration of Trust; and any apparent inconsistency shall be construed in favor of the related provisions in the Declaration of Trust.
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12 ARTICLE XV. LIMITATION OF LIABILITY
The Declaration of Trust establishing the Trust, dated as of December 15, 1989, a copy of which, together with all amendments thereto, is on file in the office of the Secretary of the Trust, provides that the name "California Asset Management Trust" and any substitute therefore refers to the Trustees under the Declaration of Trust collectively as Trustees, but not as individuals or personally; and no Trustee, Participant, officer, employee or agent of the Trust shall be held personally liable, nor shall resort be had to their private property for the satisfaction of any obligation or claim or otherwise, in connection with the affairs of the Trust, but the Trust property only shall be liable.
CAMP® is a registered trademark and the CAMP logos and designs are trademarks owned by the California Asset Management Trust (Trust).
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Investor Agreement_5-26-2021
ATTACHMENT D
CALIFORNIA ASSET MANAGEMENT TRUST
INVESTOR AGREEMENT
By signing this Investor Agreement (“Agreement”), the undersigned Public Agency (“Investor”) agrees with California Asset Management Trust (“Trust”) to the following:
1. Program Guide, Declaration of Trust, and By-Laws. Investor acknowledges that it has received and read a copy of the Program Guide, consisting of the Information Statement (“Information Statement”) and additional information, in effect as of the date of this Agreement (collectively the “Program Guide”), the Declaration of Trust, in effect as of the date of this Agreement (the “Declaration of Trust”), and the By-Laws, in effect as of the date of this Agreement (“By-Laws”).
Unless otherwise stated, capitalized terms used but not otherwise defined in this Agreement have the meanings set forth in the Declaration of Trust.
2. Investment. The Trust will sell to the Investor and the Investor will purchase shares of beneficial interest (“Shares”), which are part of a series of Shares issued by the Trust for Public Agencies that invest in the Trust but do not join the Trust as Participants (“Investor Shares Series”).
3. Representations and Warranties. The Investor represents and warrants to the Trust as follows and acknowledges that the Investor has full knowledge that the Trust intends to rely on such representations and warranties and that such representations and warranties shall be deemed renewed with each purchase of the Shares of Investor Shares Series:
(a) The rights, privileges, preferences and restrictions of the Investor Shares Series being purchased are subject to the terms of the Information Statement, the Declaration of Trust, the By-Laws, and this Agreement.
(b) The Investor is duly organized and validly existing as a Public Agency of the State of California, as that term is defined in Sections 6500 and 6509.7(b) of the Act, as may be amended from time to time, and has full legal right, power and authority to enter into this Agreement to observe and perform its obligations hereunder and to invest its assets as provided herein; and by all necessary official actions the Investor has duly authorized and approved the execution hereof, the observance and performance of its obligations hereunder and the investment of its assets as provided herein. (c) This Agreement constitutes a legal, valid and binding obligation of the Investor enforceable against such Investor in accordance with its respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or limiting creditors rights generally.
(d) The Investor has read carefully and understands the Program Guide, the Declaration of Trust and the By-Laws.
(e) The Investor has been furnished any and all materials that it requested relating to the Trust, the offering of the interests in the Trust and the information contained in the Program Guide and has been afforded the opportunity to obtain any additional information necessary to verify the accuracy of any such information.
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Investor Agreement_5-26-2021
(f) The Investor has been advised to consult with its own attorneys and tax advisors regarding the legal, regulatory, and tax matters concerning the Trust and the purchase of Shares of Investor Shares Series.
(g) The execution and delivery of this Agreement and the completion of the transactions will not conflict with, or result in any violation of or default pursuant to, any provision of any governing instrument applicable to the Investor, or any agreement or other instrument to which it is a party or by which it or any of its properties are bound or any permit, franchise, judgment, decree, statute, rule or regulation applicable to it or any of its properties.
(h) All of the information that the Investor has furnished in this Agreement is correct and complete as of the date hereof, and if there is any material change in such information, the Investor will immediately furnish such revised and corrected information to the Trust. (i) The Investor agrees that the foregoing representations and warranties may be used as a defense in any action relating to the Trust or the offering of Shares issued by the Trust. (j) The Investor represents and warrants to the Trust that all information provided by the Investor to the Trust is correct and complete as of the date of its execution of the Agreement. (k) The Investor represents and warrants to the Trust that the individual executing this Agreement on its behalf holds the title indicated below his/her name and that such individual is authorized in the name of and on behalf of the Investor to execute and deliver this Agreement.
4. Acknowledgements. The Investor acknowledges and agrees with the Trust that:
(a) Neither the Shares nor the Trust are registered under the Securities Act or any other applicable securities laws in reliance upon the exemption from registration provided in Section 3(a)(2) of the ’33 Act, Section 2(b) of the ’40 Act, and applicable exemptions under securities laws of the State of California. The Investor understands that as of the date hereof the Trust does not intend to register the Shares under the ’33 Act or the Trust itself under the ’40 Act. (b) The Investor will indemnify and hold harmless the Trust, the Trustees, its officers and advisors in respect of all claims, actions, losses, costs, and damages resulting from any inaccuracy in any representations or breach of any warranties of the Investor contained in this Agreement. (c) The Investor undertakes to make all payments in respect of its purchase of the Shares of Investor Shares Series in accordance with the terms of the Program Guide. (d) The Investor agrees that the foregoing acknowledgements may be used as a defense in any action relating to the Trust or the offering of Shares of Investor Shares Series.
5. Miscellaneous.
(a) Amendments. This Agreement may be amended only with the approval or consent of the Trustees and the Investor.
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(b) Governing Law; Severability. This Agreement shall be construed in accordance with the laws of the State of California and, to the maximum extent possible, in such manner as to comply with all the provisions of the Act. If it is determined by a court of competent jurisdiction that any provision of this Agreement is invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement. (c) Notices. All notices hereunder must be in accordance with Section 6.6 of the Declaration of Trust.
(d) Failure to Assert or Insist Upon Strict Performance. No failure by any party hereto to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement, or to exercise any right or remedy consequent upon a breach thereof, shall constitute a waiver of any such breach or any other covenant, duty, Agreement or condition hereof. (e) Entire Agreement. This Agreement contains the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior agreements, understandings, or proposal with respect thereto.
(f) Immunity from Liability, Limited Waiver of Sovereign Immunity of Certain Investors.
All of the privileges and immunities from liability, all exemptions from laws, ordinances and rules, and all pension, relief, disability, workmen’s compensation, and other benefits which apply to the activity of Trustees, officers, agents or employees of the Initial Participants and any additional Participants and Investors when performing their functions within the territorial limits of their respective Public Agencies, shall apply to them to the same degree and extent while engaged in the performance of any of their functions and duties associated with the Trust; provided however, that notwithstanding the foregoing, any Investor that is a federally recognized Indian tribe agrees (i) to a limited waiver of its sovereign immunity solely for the purpose of authorizing the Trustees, to initiate an action against it to enforce any right under this Investor Agreement, to seek provisional remedies and to enforce an award or judgment rendered in any such action; and (ii) to waive its sovereign immunity from any judgment or liability arising from any such action, but any such waiver shall be limited to and co-extensive with any immunity afforded an Investor that is a California Public Agency but not a federally recognized Indian tribe. The Trust, acting through one or more service providers, with the consent of the Board President, shall be authorized to negotiate and to enter into agreements with federally recognized Indian tribes on behalf of the Trust consistent with the above waivers as required to address terms and conditions.
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IN WITNESS WHEREOF, the Investor has executed this Investor Agreement on the date set forth below.
This Investor Agreement shall not be binding on the Trust unless and until it has been duly executed below by an authorized representative of the Trust.
INVESTOR
ON BEHALF OF THE_____________________________________________ (Name of Public Entity)
By:____________________________________________
Name: _________________________________________
Title: __________________________________________
Date: __________________________________________
CALIFORNIA ASSET MANAGEMENT TRUST
By:____________________________________________
Name: _________________________________________
Title: Secretary___________________________________
Date: __________________________________________
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Policy Title Investment Policy – Proposed Amendments Redline Policy Number 14 Effective: 03/05/2020
02/01/2024
This Investment Policy (Policy) establishes guidelines for the management of cash, deposits, and investments (together, “Funds”) at Clean Power Alliance of Southern California (CPA).
I. Investment Objectives
When managing Funds, CPA’s primary objectives, in the following order of importance, shall be to (1) safeguard the principal of the Funds, (2) meet the liquidity needs of CPA, and (3) achieve a return on investment on Funds in CPA’s control.
A. Safety: Safety of principal is the foremost objective of cash and investment management activities. The investment of Funds shall be undertaken in a manner that seeks to ensure the preservation of principal.
B. Liquidity: The Funds of CPA shall remain sufficiently liquid to meet all operating needs that may be reasonably anticipated. Since all possible cash demands cannot be anticipated, the investment of Funds in deposits or instruments that are available on demand is recommended.
C. Return on Investment: The deposit and investment portfolio shall be designed with the objective of attaining a market rate of return throughout the economic cycle while considering risk and liquidity constraints. The return on deposits and investments is of secondary importance compared to the safety and liquidity objectives described in I.A. and I.B., above.
II. Standard of Care
CPA will manage Funds in accordance with the Prudent Investor Standard pursuant to California Government Code Section 53600.31:
“[G]overning bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling or managing public funds, a trustee shall act with care, skill, prudence and diligence under the circumstances then prevailing, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.” Pursuant to Section 53607, the Board hereby delegates responsibility to manage Funds to CPA’s Treasurer or in lieu thereof, the Executive Director. The Treasurer is authorized to 1 All further statutory references are to the California Government Code unless otherwise stated.
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appoint Deputy Treasurer(s) as the Treasurer deems necessary for the prompt and faithful discharge of its duties, pursuant to Section 53607.
III. Acceptable and Prohibited Investment Types
A. The following types of investments are permitted:
1. Deposits at Bank(s): Funds may be invested in non-interest-bearing depository accounts to meet CPA’s operating and collateral needs and grant requirements.
Funds not needed for these purposes may be invested in interest-bearing depository accounts or Federal Deposit Insurance Corporation (FDIC) insured certificates of deposit with maturities not to exceed five (5) years. Banks eligible to receive deposits will be federally or state chartered and will conform to Section 53635.2 which requires that banks “have received an overall rating of not less than ‘satisfactory’ in its most recent evaluation by the appropriate federal financial supervisory agency of its record of meeting the credit needs of California's communities, including low- and moderate-income neighborhoods, pursuant to Section 2906 of Title 12 of the United States Code.” As per Section 53652, banks must collateralize the deposits of public agencies in an amount equal to no less than 110% of as currently stated in the value of the deposits.
The Treasurer will monitor the credit quality of eligible banks holding CPA deposits that exceed FDIC insurance limits to ensure the safety of CPA deposits.
2. Local Agency Investment Fund (LAIF): Funds may be invested in the Local Agency Investment Fund established by the California State Treasurer for the benefit of local agencies.
3. California Asset Management Program (CAMP): Funds may be invested in the California Asset Management Program.
3.4. US Treasury Obligations: Funds may be invested in United States Treasury obligations with a term to maturity not exceeding five (5) years and subject to the limitations set forth in Sections 53601 et seq. and 53635 et seq.
4.5. Federal Agency Securities: Funds may be invested in Federal Agency Securities with a term to maturity not exceeding five (5) years and subject to the limitations set forth in Sections 53601 et seq. and 53635 et seq.
5.6. Bankers’ Acceptances: Funds may be invested in Banker’s Acceptances provided that they are issued by institutions which have short-term debt obligations rated “A-1” or its equivalent of better by at least one NRSRO (Nationally Recognized Statistical Rating Organization). Not more that 40% of the portfolio may be invested in Bankers’ Acceptances, and no more than 5% of the portfolio may be invested in any single issuer. The maximum maturity shall not exceed 180 days.
6.7. Negotiable Certificates of Deposit: Funds may be invested in negotiable certificates of deposit in accordance with the requirements of Section 53601 and 53601.8, and subject to the following limitations:
i. Issued by an entity as defined in Section 53601(i); and ii. No more than 30% of the total portfolio shall be invested in certificates of deposit.
7.8. Placement Service Deposits: Funds may be invested in deposits placed with a private sector entity that assists in the placement of deposits with eligible financial institutions located in the United States (Section 53601.8). The full Agenda Page 81 of 83
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amount of principal and the interest that may be accrued during the maximum term of each deposit shall at all times be insured by federal deposit insurance.
The maximum portfolio exposure to the deposits placed pursuant to this section shall be limited by Section 53601.8.
8.9. Money Market Funds: Funds may be invested in money market funds pursuant to Section 53601(l)(2) and subject to Section 53601(l)(4).
B. Prohibited Investment Types
Pursuant to Section 53601.6, CPA shall not invest Funds in any security that could result in a zero-interest accrual, or less, if held to maturity. These prohibited investments include, but are not limited to, inverse floaters, range notes, or mortgage-derived interest-only strips.
IV. Investment Portfolio Management
The term to maturity of any Funds invested shall not exceed five (5) years pursuant to Section 53601. The Treasurer will allocate Funds among authorized investments consistent with the objectives and standards of care outlined in this Policy.
V. Bids and Purchase of Securities
Prior to the purchase of an investment pursuant to this Policy the persons authorized to make investments shall assess the market and market prices using information obtained from available sources including investment services, broker or dealers, and the media. A competitive bid process, when practical, will be used to place all investment purchases and sales transactions. Any competitive bid process used pursuant to this Policy shall be exempt from CPA’s Non-Energy Contracting Policy.
VI. Brokers
Broker/dealers shall be selected by the Executive Director upon recommendation by the Treasurer. Selection of broker/dealers shall be based upon the following criteria: the reputation and financial strength of the company or financial institution, the reputation and expertise of the individuals employed, and pursuant to the requirements of Section 53601.5. The Executive Director shall require any selected broker, brokerage firm, dealer, or securities firm to affirm that it has not, within any 48-consecutive month period, made a political contribution to any member of the CPA Board, or any candidate who may join the CPA Board in an amount exceeding the limitations contained in Rule G-37 of the Municipal Securities Rulemaking Board, the Political Reform Act, including section 84308, or any applicable CPA Policy, as amended from time to time. The selected broker or dealers shall be provided with and acknowledge receipt of this Policy, the Vendor Communication Policy, and the Campaign Contribution Disclosure Form.
VII. Losses
Losses are acceptable on a sale before maturity and may be taken if required to meet the liquidity needs of CPA or if the reinvestment proceeds will earn an income flow with a present value higher than the present value of the income flow that would have been generated by the original investment, considering any investment loss or foregoing interest on the original investment.
VIII. Delivery and Safekeeping
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The delivery and safekeeping of all securities shall be made through a third-party custodian when practical and cost effective as determined by the Treasurer and in accordance with Section 53608.
The Treasurer shall review all transaction confirmations for conformity with the original transaction.
IX. Conflict of Interest
CPA staff shall comply with state law and applicable CPA policies regarding conflicts of interest.
X. Audits
CPA’s Funds shall be subject to a process of independent review by its external auditors. CPA’s external auditors shall review the investment portfolio in connection with CPA’s annual audit for compliance with the Policy pursuant to Section 27134. The results of the audit shall be reported to the Treasurer.
XI. Reports
A. Monthly: The Treasurer will perform a monthly review of the investment function.
Following the commencement of investment transactions, the Treasurer shall submit a monthly report of all investment transactions to the Finance Committee. Investment transactions are defined as the purchase, sale or exchange of securities.
B. Annually: The Treasurer will submit an annual report to the Finance Committee within 60 days of the end of a fiscal year providing the following:
i. A list of individual securities by investment type, issuer, credit risk rating, CUSIP number, settlement date of purchase, date of maturity, par value and dollar amount invested on all securities, the market value and source of the market value information;
ii. A statement that the portfolio is in compliance with this Policy and in accordance with Section 53646 or the manner in which the portfolio is not in compliance; and iii. A statement of CPA’s ability to meet anticipated cash requirements for the upcoming 12 months.
C. Annual Review: This Policy will be reviewed annually by the Treasurer. The Executive Committee is authorized to approve changes to this Policy following the review of proposed changes by the Finance Committee.
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