HUD-52736-B Depository Agreement - Brokers/Dealers

Approved OMB #: 2577-0218
Exp. 07/31/2019

DEPOSITORY AGREEMENT
U.S. Department of Housing and Urban Development
Office of Public and Indian Housing
Brokers/Dealers
This Agreement entered into this _____ day of __________________, 20____,
between _________________________________________________________ (herein
called the “Recipient”), [a [federally recognized or state recognized] Indian tribe; an Indian
Housing Authority created under [tribal or state] law; or an entity created under [tribal or
state] law providing for housing authorities or housing entities for Indians]
and __________________________________________________________ (herein called
the “Broker/Dealer”) located at
______________________________________________________________.
Witnesseth:
Whereas, the United States Department of Housing and Urban Development (herein called
“HUD”) has entered into one or more grant agreements (herein called NAHASDA Grant
Agreement”) with the Recipient for the purpose of funding affordable housing activities
under the Native American Housing Assistance and Self-Determination Act of 1996 (25
U.S.C. 4101 et seq.) (herein called “NAHASDA”);
Whereas, the Recipient may borrow funds for affordable housing activities which HUD
guarantees under the Title VI of NAHASDA pursuant to a guarantee contract (herein called
“Guarantee Contract”);
Whereas, the Recipient may invest Indian Housing Block Grant funds in Investments
prescribed by HUD through an insured Broker/Dealer for the purpose of carrying out
affordable housing activities under NAHASDA;
Whereas, the Recipient is required to hold funds for investment in an account subject to an
agreement in a form prescribed by HUD;
Whereas, the Recipient may establish and maintain a separate reserve account only for the
purpose of accumulating amounts for administration and planning relating to affordable
housing activities under NAHASDA;
Whereas, the Recipient may invest funds in a reserve account only in Investments prescribed
by HUD subject to an agreement in a form prescribed by HUD;
Whereas, the Recipient must ensure that any interest or dividends earned on funds in a
reserve account that is deemed non-program income in accordance with 24 C.F.R. §
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1000.239 are tracked and accounted for separately from the Indian Housing Block Grant
funds deposited in the reserve account;
Whereas, the Recipient may only invest in the following (herein collectively called
“Investments prescribed by HUD”): obligations of the United States; obligations issued
by United States Government sponsored agencies; securities that are guaranteed or
insured by the United States; mutual (or other) funds registered with the Securities and
Exchange Commission and which invest only in obligations of the United States or
securities that are guaranteed or insured by the United States.
Whereas, the Broker/Dealer warrants and represents that it is registered as a brokerdealer under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) with the
Securities and Exchange Commission and shall be a member of the Securities Investor
Protection Corporation (SIPC); and
Whereas, the Broker-Dealer desires to perform certain brokerage services for the
Recipient in accordance with the terms of this Agreement.
Now Therefore, in consideration of the mutual covenants hereinafter set forth, the
parties hereto agree as follows:
1. Investments prescribed by HUD must be purchased through an insured
Broker/Dealer who is registered with the Securities and Exchange Commission and is
covered by Securities Investor Protection Corporation (SIPC) insurance. The
Broker/Dealer shall ensure that its brokerage accounts are continuously insured by the
SIPC or an insurance organization specifically approved by the Secretary of the U.S.
Treasury Department under Title 31, CFR, Part 226 (each, a Federal Insurance
Organization).
2. All monies deposited by the Recipient with the Broker/Dealer shall be credited to the
Recipient in a separate interest-bearing deposit or interest-bearing accounts, designated:
[enter account name(s) and/or accounts number(s)]
____________________________________________________________
____________________________________________________________
(herein called the “Accounts”). Any portion of the Recipient’s funds not insured by a
Federal Insurance Organization shall be fully (100%) and continuously collateralized
with specific and identifiable investments prescribed by HUD. The Broker/Dealer
agrees, for the purpose of insuring and guaranteeing any portion of the Recipient’s
funds not insured by a Federal Insurance Organization, to pledge and, at all times while
in custody of such funds, maintain the pledge of collateral security of the classes
described, and under the terms and conditions set forth, in paragraph 5 of PIH Notice
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96-33, Required HA Cash Management and Investment Policies and Procedures, issued
June 30, 1997, and extended on August 2, 2002, indefinitely.
2a. The Broker/Dealer agrees that, in the event of its failure to pay, when due, the
whole or any part of the funds deposited in the Account(s), or in the event of the failure
for any reason of the Recipient or HUD to receive promptly funds to be transmitted or
otherwise handled by the Broker/Dealer in the performance of its duties under this
Agreement, or in the event that the Broker/Dealer shall otherwise violate or fail to
perform any of the terms of this agreement, or in the event of the insolvency of the
Broker/Dealer, or the Broker/Dealer shall be closed for business by law or by proper
corporate action, or in the event that a receiver, or conservator, or liquidator or any
other officer shall be appointed for the purpose of terminating the business of the
Broker/Dealer, HUD, without prior notice or demand, through such agents as it may
designate for the purpose, may forthwith redeem or sell the pledged collateral, and any
addition thereto or substitution therefore, or any part thereof, at either public or private
sale or sales, and apply the proceeds of such redemption or sale or sales, after deducting
all necessary or proper expense of such redemption or sale or sales, to the payment of
funds deposited in the Account(s) or the repayment of funds received by the
Broker/Dealer for transmission or handling, or both, or any other indebtedness of the
Broker/Dealer to HUD by reason of this Agreement, any surplus remaining from the
proceeds of the redemption or sale or sales of such investments after payment or
repayment in full has been made, to be paid to the Broker/Dealer.
3. Except as stated in paragraph 5, the Broker/Dealer shall honor any (a) check or other
order to pay from the Accounts, or (b) directive to purchase Investments prescribed by
HUD with monies from the Accounts or to sell the investments, if such order or
directive is in writing and signed on behalf of the Recipient by an authorized
representative who is designated by resolution of the governing body of Recipient to
have such authority. To assist the Broker/Dealer in its obligation, the Recipient shall
furnish the Broker/Dealer with a certified copy of the resolution.
4. Any investments received for the Recipient or investments purchased with the
Recipient’s funds by the Broker/Dealer with monies from the Accounts shall be
considered to be a part of the Accounts and shall be held by the Broker/Dealer in
safekeeping for the Recipient until sold. Dividends, interest, and distributions on such
investments and proceeds from the sale thereof shall be used to purchase additional
shares or remitted directly to the Recipient. Where Dividends, interest, and distributions
are earned from the Recipient’s funds in reserve accounts, the Recipient must ensure
that such amounts may be tracked and accounted for separately from the Indian
Housing Block Grant funds deposited in the reserve account. Where such funds cannot
be tracked and accounted for separately, such Dividends, interest, and distributions
earned on the investment of funds in reserve accounts must be either remitted directly
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to the Recipient, or shall be held by the Broker/Dealer in safekeeping for the Recipient
until sold to ensure that funds with different Federal requirements are not commingled;
5. Notwithstanding any other provision of this Agreement to the contrary, if the
Broker/Dealer receives written notice from HUD that no withdrawals by the Recipient
from the Accounts are to be permitted, the Broker/Dealer shall not honor any check or
other order to pay from the Accounts or directive to purchase or sell investments, or
permit any withdrawals by the Recipient until the Broker/Dealer is authorized to do so
by written notice from HUD. In addition, upon written demand from HUD, the
Broker/Dealer shall pay to HUD funds from the Accounts, which may be the entire
amount in the Accounts. HUD may only demand funds in accordance with the
requirements of 24 CFR §1000.532 or if timely payment is not made on the note or
other obligation in accordance with the Guarantee Contract.
6. The Broker/Dealer is not obligated to be familiar, and shall not be charged, with
knowledge of the provisions of the NAHASDA Grant Agreement and Guarantee
Contract, and shall be under no duty to investigate or determine whether any actions
taken by either the Recipient or HUD are consistent with or are authorized by the
NAHASDA Grant Agreement or Guarantee Contract or whether either the Recipient is
in default or noncompliance with the NAHASDA Grant Agreement or Guarantee
Contract. The Broker/Dealer shall be fully justified in accepting and acting on, without
investigation, any certificate, notice, or demand furnished to it pursuant to the
provisions of this Agreement and which the Broker/Dealer shall in good faith believe to
have been duly authorized and executed on behalf of the party in whose name the same
purports to have been made or executed.
7. The rights and duties of the Broker/Dealer under this Agreement shall not be
transferred or assigned by the Broker/Dealer without the prior written approval of the
Recipient and HUD. This Agreement may be terminated by either party hereto upon
thirty days written notice to the other party, and HUD. The rights and duties of the
Broker/Dealer hereunder shall not be transferred or assigned nor shall this Agreement
be terminated during any period in which the Broker/Dealer is required to refuse to
permit withdrawals from the Accounts as provided in paragraph 5.
8. HUD is intended to be a third-party beneficiary of this Agreement and certain
provisions of this Agreement are for the benefit of HUD and HUD may sue to enforce
its provisions and to recover damages for failure to carry out its terms.
9. The Recipient shall submit a fully executed copy of this Agreement to HUD within 30
business days of the Agreement’s execution.

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10. The Broker/Dealer shall promptly notify the Recipient of the deposit or credit
of any monies to the Accounts.
11. The provisions of this Agreement may not be modified by either party without
the prior written approval of HUD.
12. For purposes of notification or submission of this Agreement or other documentation to
HUD, HUD shall be the Area Office of Native American Programs to which the recipient
submitted its Indian Housing Plan pursuant to 24 CFR § 1000.214.

In Witness Whereof, the Recipient and the Depository have caused this Agreement to be
executed in their respective names and their respective seal to be impressed hereon and
attested as of the date and year first above written.

Recipient
By: __________________________

Title: __________________________
Authorized representative
[SEAL]
ATTEST:
______________________________

Broker/Dealer
By: __________________________

Title: __________________________
Authorized representative
[SEAL]
ATTEST:
______________________________
Public reporting burden for the collection of information is estimated to average 15 minutes. This includes the time for collecting,
reviewing, and reporting the data. Response to this request for information is required in order to receive the benefits to be derived.
The information is used to allow Indian Housing Block Grant (IHBG) recipients to invest IHBG funds in eligible instruments with
brokers. The information requested is not confidential,as explained at 5 CFR 1320.8(b)(3). This agency may not collect this
information, and you are not required to complete this form unless it displays a currently valid OMB control number.

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