HomeMy WebLinkAboutFin Authorization to Issue Bonds--PFM Financial AdvisorsAMENDMENT TO AGREEMENT FOR FINANCIAL ADVISORY SERVICES
THIS AMENDMENT to the Agreement for Financial Advisory Services is made and
entered into as of the 5" day of Mo.yc.h ,2018, by and between the CITY OF SAN
RAFAEL (hereinafter "City"), and PFM FINANCIAL ADVISORS LLC.
RECITALS
WHEREAS, on April 16,2014 City entered into an "Agreement for Financial Advisory
Services" with Public Financial Management, Inc. for hourly professional financial consulting
services in an amount not to exceed $35,000 (the "Agreement"); and
WHEREAS, pursuant to Article V of the Agreement, the City has consented to the
assignment of the Agreement to Public Financial Management, Inc.' s successor, called PFM
Financial Advisors, LLC (hereinafter "PFM"); and
WHEREAS, Article III, Section 2 of the Agreement acknowledged that at such time as
the City desired additional financial consulting services related to the issuance of bonds or other
financing transactions, the parties to the Agreement would mutually agree upon the terms of
compensation for such transactional work; and
WHEREAS, the City now wishes to obtain additional services from PFM in connection
with the City's planned issuance of lease revenue bonds to finance the City's construction of new
public safety facilities;
NOW, THEREFORE, City and PFM hereby agree to amend the Agreement as follows:
AMENDMENT TO AGREEMENT
1. Article I of the Agreement, entitled "SCOPE OF SERVICES" is hereby amended
to include the additional services set forth in PFM's proposal dated January 8,
2018, attached to this Amendment as Attachment 1, and incorporated herein by
reference.
2. Article III of the Agreement, entitled "FINANCIAL ADVISORY
COMPENSATION" is hereby amended to include in Sections 2 and 3 thereof the
additional compensation payable to PFM for the services described in Attachment
1, as detailed in Exhibit B thereof.
1
3 . Except as specifically amended herein, all of the other provisions, terms and
obligations of the Agreement between the parties shall remain valid and shall be
in full force.
IN WITNESS WHEREOF, the parties have executed this Amendment on the day,
month, and year first above written.
CITY OF SAN RAFAEL PFM FINANCIAL ADVISORS LLC
By:;k tdlU--.......
ATTEST:
Title: H A f") A J Ina D I re cfor
LINDSAY LARA, Interim City Clerk
APPROVED AS TO FORM:
2
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pfm
50 California Street
SUite 2300
San FrancIsco. CA 94111
4 159825544
pfm.com
Mr. Mark Moses
Finance Director
City of San Rafael
1400 Fifth Avenue
San Rafael, CA 94901
Dear Mark:
January 8, 2018
The purpose of this letter (this "Engagement Letter") is to confirm our
agreement that PFM Financial Advisors LLC ("PFM") will act as municipal
advisor to the City of San Rafael (the "City") in connection with the issuance
of its 2018 Lease Revenue Bonds (the "2018 Bonds") to finance a portion of
the City's Measure E public safety facility improvements . For this
engagement, PFM will provide services related to the 2018 Bonds as set forth
in Exhibit A hereto, and compensation will be as set forth in ExhibiU! hereto.
Other terms of our agreement with the City are as set forth in the existing
contract between the City and Public Financial Management, Inc., an affiliate
of PFM Financial Advisors LLC, dated as of April 16, 2014, authorized by City
Council Resolution No. 13697 (approved April 7, 2014).
PFM is a registered municipal advisor with the Securities and Exchange
Commission (the "SEC") and the Municipal Securities Rulemaking Board (the
"MSRB"), pursuant to the Securities Exchange Act of 1934 Rule 15Ba1-2. If
the City has designated PFM as its independent registered municipal advisor
("IRMA") for purposes of SEC Rule 15Ba1-1 (d)(3)(vi) (the "IRMA exemption"),
then services provided pursuant to such designation shall be the services
described in Exhibit 6. hereto, subject to any limitations described thereon.
PFM shall not be responsible for, or have liability in connection with, verifying
that PFM is independent from any other party seeking to rely on the IRMA
exemption (as such independent status is required pursuant to the IRMA
exemption, as interpreted from time to time by the SEC). The City
acknowledges and agrees that any reference to PFM, its personnel and its
role as IRMA, including in the written representation of the City required under
SEC Rule 15Ba1-1 (d)(3)(vi)(B) shall be subject to prior approval by PFM.
The City further agrees not to represent that PFM is the City's IRMA with
respect to any aspect of a municipal securities issuance or municipal financial
product, outside of the scope of services without PFM's prior written consent .
MSRB Rule G-42 requires that municipal advisors make written disclosures to
the City of all material conflicts of interest and certain legal or disciplinary
events. Such disclosures are provided in PFM's Disclosure Statement
delivered to the City together with this Engagement Letter.
Rev. 22.06.2016
PFM's services will commence as soon as practicable after the execution of
this Engagement Letter by the City and a request by the City for such service .
Any material changes in or additions to the scope of services described in
Exhibit A shall be promptly reflected in a written supplement or amendment to
this Engagement Letter. Services provided by PFM which are not included in
the scope of services set forth in Exhibil A of this Engagement Letter shall be
completed as agreed in writing in advance between the City and PFM. Upon
request of the City, PFM or an affiliate of PFM may agree to additional
services to be provided by PFM or an affiliate of PFM, by a separate
agreement between the City and PFM or its respective affiliate .
The following professional employees of PFM will have primary responsibility
for providing the services set forth in this Engagement Letter: Sarah
Hollenbeck, Michelle Sarabia, and Kevin Dong. PFM may, from time to time,
supplement or otherwise amend team members. The City has the right to
request, for any reason, PFM to replace any member of the advisory staff.
Should the City make such a request, PFM will promptly suggest a substitute
for approval by the City.
Please have an authorized official of the City sign a copy of this Engagement
Letter and return it to us to acknowledge the terms of this engagement.
-2 -
Sincerely,
PFM Financial Advisors LLC
~?k£--,
Sarah Hollenbeck
Managing Director
Accepted by :
CITY OF SAN RAFAEL
-Name
Title
Date
Rev . 22.06.2016 -3 -
~XHIBIT A
SCOPE OF SERVICES
In connection with the 2018 Bonds, PFM's scope of services is expected to include the
following:
• Reviewing the project expenditure projections and Measure E revenue
projections prepared by the City's other consultants to assess when bonds
proceeds will be required
• Evaluating the borrowing capacity of the Measure E revenue stream given
project timing and bond market trends
• Evaluating alternative debt service structures for the Bonds
• Developing a time and responsibility schedule for the transaction
• Advising the City on the method of sale for the 2018 Bonds
• Preparing and distributing an RFP for underwriting services, summarizing
underwriter proposals and participating in underwriter selection
• Procuring via competitive process other services required in connection with the
transaction (financial printer, trustee and escrow agent, etc.)
• Reviewing all legal and disclosure documents related to the bond issue
• Participating in working group meetings, meetings with City staff, and City
Council subcommittee and regular meetings in connection with the transaction
• Preparing presentation materials and information pertaining to the City and the
bonds for rating agency and/or bond insurer review
• Advising the City regarding the structure of the financing, the terms of bonds,
timing of the bond sale, the maturity schedule of the bonds, call features,
maintenance of reserves, and any other matters which may assist the City in
obtaining the lowest practical interest costs for the bonds
• With the participation of PFM's Pricing Group, providing the City with
independent advice on the coupons, yields and structure of the bonds that will
attract the broadest possible investor participation and the lowest cost of funds
• Participating in pre-pricing and pricing calls with the City and the Underwriter for
the bonds and assist the City in negotiating the final interest rates on the bonds
• Memorializing the transaction process and results for the City staff in a post-sale
memorandum
Rev . 22.06.2016 -4 -
EXHIBIT B
COMPENSATION FOR SERVICES
For municipal advisor services in connection with the Refunding Bonds, PFM will be
paid a fixed transaction fee of $48,000 .
In addition to fees for our services on this transaction, PFM will be reimbursed for
necessary, reasonable, and documented out-of-pocket expenses incurred, including
travel, meals, lodging, telephone, mail, and other ordinary cost and any actual
extraordinary cost for graphics, printing, data processing and computer time.
Documentation of such expenses will be provided and expenses will be capped at
$1,500.
Rev. 22.06 .2016 - 5 -
Rev. 22.06.2016
EXHIBIT C
INSURANCE STATEMENT
Insurance Statement
PFM Financial Advisors LLC ("PFMFA") has a complete insurance
program, including property, casualty, comprehensive general liability,
automobile liability and workers compensation. PFMFA maintains
professional liability and fidelity bond coverages which total $30 million and
$10 million, respectively. PFMFA also carries a $10 million cyber liability
policy.
Our Professional Liability policy is a "claims made" policy and our General
Liability policy claims would be made by occurrence.
Deductibles/SIR:
Automobile $250 comprehensive & $500 collision
Cyber Liability $50,000
General Liability $0
Professional Liability (E&O) $1,000,000
Financial Institution Bond $75,000
Insurance Company & AM Best Rating
Professional Liability (E&O) .... Indian Harbor Insurance Company; and
............................................... Continental Casualty Company; (both are A)
Financial Institution Bond ....... Federallnsurance Company; (A++)
Cyber Liability ...................... Indian Harbor Insurance Company (A)
General Liability ..................... Great Northern Ins. Company; (A++)
Automobile Liability ................. Federallnsurance Company
Excess IUmbrella Liability ....... Federallnsurance Company
Workers Compensation .......... Pacific Indemnity Company; (A++)
& Employers Liability
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pfm
50 California Street
SUite 2300
San Fram .sco CA 94111
4 15 982.5544
pfm.com
Mark Moses
Finance Director
City of San Rafael
1400 5th Ave
San Rafael, CA 94901
January 25 , 2018
Re : Notice of Assignment of Contract for Financial Advisory Services
Dear Mark:
This letter is to inform you that we are pleased to offer the same great financial advisory
services pursuant to the Agreement for Financial Advisory Services dated April 16, 2014
between City of San Rafael and Public Financial Management , Inc. ("PFMI") through our
affiliated company PFM Financial Advisors LLC ("PFM FA") , a municipal advisor registered with
the SEC and MSRB . Delivery of our services will not be impacted as current financial advisory
personnel will continue to provide services to you under PFMFA.
Please sign this letter to acknowledge your consent and return it to Cayla Wilbur, Senior
Associate, by email wilburc@pfm .com. In all other respects the agreement is ratified, and the
terms and conditions remain in full force and effect.
We appreciate your assistance and look forward to our continued service to City of San Rafael.
Thank you in advance for your prompt attention to this matter.
Sincerely ,
Sarah Hollenbeck, Managing Director
Acknowledgment:
City of San Rafael
Name
Date