HomeMy WebLinkAbout2004 CON Estrada Hinojosa - Financial Advisory ServicesAGREEMENT
BY AND BETWEEN
THE CITY OF NATIONAL CITY
AND
ESTRADA HINOJOSA INVESTMENT BANKERS
THIS AGREEMENT is entered into this 5th day of May 2004, by and
between the CITY OF NATIONAL CITY, a municipal corporation (the "CITY"), and
Estrada Hinojosa Investment Bankers (the "CONTRACTOR").
RECITALS
WHEREAS, the CITY desires to employ a CONTRACTOR to provide
financial advisory services as needed.
WHEREAS, the CITY has determined that the CONTRACTOR is a
financial advisory and bond underwriting firm and is qualified by experience and ability
to perform the services desired by the CITY, and the CONTRACTOR is willing to
perform such services.
NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE
AS FOLLOWS:
1. ENGAGEMENT OF CONTRACTOR. The CITY hereby agrees to
engage the CONTRACTOR and the CONTRACTOR hereby agrees to perform the
services hereinafter set forth in accordance with all terms and conditions contained
herein.
The CONTRACTOR represents that all services required hereunder will
be performed directly by the CONTRACTOR or under direct supervision of the
CONTRACTOR.
2. SCOPE OF SERVICES. The CONTRACTOR will perform services
as set forth in the attached Exhibit "A".
The CONTRACTOR shall be responsible for all research and reviews
related to the work and shall not rely on personnel of the CITY for such services, except
as authorized in advance by the CITY. The CONTRACTOR shall appear at meetings
as needed to keep staff and City Council advised of the progress on the project.
The CITY may unilaterally, or upon request from the CONTRACTOR, from time
to time reduce or increase the Scope of Services to be performed by the
CONTRACTOR under this Agreement. Upon doing so, the CITY and the
CONTRACTOR agree to meet in good faith and confer for the purpose of negotiating a
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corresponding reduction or increase in the compensation associated with said change
in services.
3. PROJECT COORDINATION AND SUPERVISION.
Chris Zapata hereby is designated as the Project Coordinator for the CITY
and will monitor the progress and execution of this Agreement. The CONTRACTOR
shall assign a single Project Director to provide supervision and have overall
responsibility for the progress and execution of this Agreement for the CONTRACTOR.
Ruben Mendoza thereby is designated as the Project Director for the CONTRACTOR.
4. COMPENSATION AND PAYMENT. The compensation for the
CONTRACTOR shall be based on monthly billings covering actual work performed.
Billings shall include labor classifications, respective rates, hours worked and also
materials, if any. The total cost for all work described in Exhibit A shall not exceed the
schedule given in Exhibit B. Monthly invoices will be processed for payment and
remitted within thirty (30) days from receipt of invoice, provided that work is
accomplished consistent with Exhibit A as determined by the CITY.
The CONTRACTOR shall maintain all books, documents, papers,
employee time sheets, accounting records, and other evidence pertaining to costs
incurred and shall make such materials available at its office at all reasonable times
during the term of this Agreement and for three (3) years from the date of final payment
under this Agreement, for inspection by the CITY and for furnishing of copies to the
CITY, if requested.
5. LENGTH OF AGREEMENT. The term of this Agreement shall
commence on May 5, 2004 and terminate on May 4, 2007.
6. DISPOSITION AND OWNERSHIP OF DOCUMENTS. The
Memoranda, Reports, Maps, Drawings, Plans, Specifications and other documents
prepared by the CONTRACTOR for this Project, whether paper or electronic, shall
become the property of the CITY for use with respect to this Project, and shall be
turned over to the CITY upon completion of the Project, or any phase thereof, as
contemplated by this Agreement.
Contemporaneously with the transfer of documents, the CONTRACTOR
hereby assigns to the CITY and CONTRACTOR thereby expressly waives and
disclaims, any copyright in, and the right to reproduce, all written material, drawings,
plans, specifications or other work prepared under this agreement, except upon the
CITY's prior authorization regarding reproduction, which authorization shall not be
unreasonably withheld. The CONTRACTOR shall, upon request of the CITY, execute
any further document(s) necessary to further effectuate this waiver and disclaimer.
The CONTRACTOR agrees that the CITY may use, reuse, alter,
reproduce, modify, assign, transfer, or in any other way, medium or method utilize the
CONTRACTOR's written work product for the CITY's purposes, and the
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CONTRACTOR expressly waives and disclaims any residual rights granted to it by Civil
Code Sections 980 through 989 relating to intellectual property and artistic works.
Any modification or reuse by the CITY of documents, drawings or
specifications prepared by the CONTRACTOR shall relieve the CONTRACTOR from
liability under Section 14 but only with respect to the effect of the modification or reuse
by the CITY, or for any liability to the CITY should the documents be used by the CITY
for some project other than what was expressly agreed upon within the Scope of this
project, unless otherwise mutually agreed.
7. INDEPENDENT CONTRACTOR. Both parties hereto in the
performance of this Agreement will be acting in an independent capacity and not as
agents, employees, partners or joint venturers with one another. Neither the
CONTRACTOR nor the CONTRACTOR'S employees are employee of the CITY and
are not entitled to any of the rights, benefits, or privileges of the CITY's employees,
including but not limited to retirement, medical, unemployment, or workers'
compensation insurance.
This Agreement contemplates the personal services of the
CONTRACTOR and the CONTRACTOR's employees, and it is recognized by the
parties that a substantial inducement to the CITY for entering into this Agreement was,
and is, the professional reputation and competence of the CONTRACTOR and its
employees. Neither this Agreement nor any interest herein may be assigned by the
CONTRACTOR without the prior written consent of the CITY. Nothing herein contained
is intended to prevent the CONTRACTOR from employing or hiring as many
employees, or subcontractors, as the CONTRACTOR may deem necessary for the
proper and efficient performance of this Agreement. All agreements by CONTRACTOR
with its subcontractor(s) shall require the subcontractor to adhere to the applicable
terms of this Agreement.
8. CONTROL. Neither the CITY nor its officers, agents or employees
shall have any control over the conduct of the CONTRACTOR or any of the
CONTRACTOR's employees except as herein set forth, and the CONTRACTOR
expressly agrees not to represent that the CONTRACTOR or the CONTRACTOR's
agents, servants, or employees are in any manner agents, servants or employees of
the CITY, it being understood that the CONTRACTOR, its agents, servants, and
employees are as to the CITY wholly independent contractors and that the
CONTRACTOR's obligations to the CITY are solely such as are prescribed by this
Ag reement.
9. COMPLIANCE WITH APPLICABLE LAW. The CONTRACTOR,
in the performance of the services to be provided herein, shall comply with all
applicable State and Federal statutes and regulations, and all applicable ordinances,
rules and regulations of the City of National City, whether now in force or subsequently
enacted. The CONTRACTOR, and each of its subcontractors, shall obtain and
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maintain a current City of National City business license prior to and during
performance of any work pursuant to this Agreement.
10. LICENSES, PERMITS, ETC. The CONTRACTOR represents and
covenants that it has all licenses, permits, qualifications, and approvals of whatever
nature that are legally required to practice its profession. The CONTRACTOR
represents and covenants that the CONTRACTOR shall, at its sole cost and expense,
keep in effect at all times during the term of this Agreement, any license, permit, or
approval which is legally required for the CONTRACTOR to practice its profession.
11. STANDARD OF CARE.
A. The CONTRACTOR, in performing any services under this
Agreement, shall perform in a manner consistent with that level of care and skill
ordinarily exercised by members of the CONTRACTOR'S trade or profession currently
practicing under similar conditions and in similar locations. The CONTRACTOR shall
take all special precautions necessary to protect the CONTRACTOR's employees and
members of the public from risk of harm arising out of the nature of the work and/or the
conditions of the work site.
B. Unless disclosed in writing prior to the date of this
agreement, the CONTRACTOR warrants to the CITY that it is not now, nor has it for the
five (5) years preceding, been debarred by a governmental agency or involved in
debarment, arbitration or litigation proceedings concerning the CONTRACTOR's
professional performance or the furnishing of materials or services relating thereto.
C. The CONTRACTOR is responsible for identifying any unique
products, treatments, processes or materials whose availability is critical to the success
of the project the CONTRACTOR has been retained to perform, within the time
requirements of the CITY, or, when no time is specified, then within a commercially
reasonable time. Accordingly, unless the CONTRACTOR has notified the CITY
otherwise, the CONTRACTOR warrants that all products, materials, processes or
treatments identified in the project documents prepared for the CITY are reasonably
commercially available. Any failure by the CONTRACTOR to use due diligence under
this sub -paragraph will render the CONTRACTOR liable to the CITY for any increased
costs that result from the CITY's later inability to obtain the specified items or any
reasonable substitute within a price range that allows for project completion in the time
frame specified or, when not specified, then within a commercially reasonable time.
12. NON-DISCRIMINATION PROVISIONS. The CONTRACTOR shall
not discriminate against any employee or applicant for employment because of age,
race, color, ancestry, religion, sex, sexual orientation, marital status, national origin,
physical handicap, or medical condition. The CONTRACTOR will take positive action to
insure that applicants are employed without regard to their age, race, color, ancestry,
religion, sex, sexual orientation, marital status, national origin, physical handicap, or
medical condition. Such action shall include but not be limited to the following:
employment, upgrading, demotion, transfer, recruitment or recruitment advertising,
layoff or termination, rates of pay or other forms of compensation, and selection for
training, including apprenticeship. The CONTRACTOR agrees to post in conspicuous
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places available to employees and applicants for employment any notices provided by
the CITY setting forth the provisions of this non-discrimination clause.
13. CONFIDENTIAL INFORMATION. The CITY may from time to time
communicate to the CONTRACTOR certain confidential information to enable the
CONTRACTOR to effectively perform the services to be provided herein. The
CONTRACTOR shall treat all such information as confidential and shall not disclose
any part thereof without the prior written consent of the CITY. The CONTRACTOR
shall limit the use and circulation of such information, even within its own organization,
to the extent necessary to perform the services to be provided herein. The foregoing
obligation of this Section 13, however, shall not apply to any part of the information that
(i) has been disclosed in publicly available sources of information; (ii) is, through no
fault of the CONTRACTOR, hereafter disclosed in publicly available sources of
information; (iii) is already in the possession of the CONTRACTOR without any
obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the
CONTRACTOR by a third party, but only to the extent that the use or disclosure thereof
has been or is rightfully authorized by that third party.
The CONTRACTOR shall not disclose any reports, recommendations,
conclusions or other results of the services or the existence of the subject matter of this
Agreement without the prior written consent of the CITY. In its performance hereunder,
the CONTRACTOR shall comply with all legal obligations it may now or hereafter have
respecting the information or other property of any other person, firm or corporation.
CONTRACTOR shall be liable to CITY for any damages caused by
breach of this condition, pursuant to the provisions of Section 14.
14. INDEMNIFICATION AND HOLD HARMLESS. The CONTRACTOR
agrees to defend, indemnify, and hold harmless the City of National City, its officers and
employees, against and from any and all liability, loss, damages to property, injuries to,
or death of any person or persons, and all claims, demands, suits, actions,
proceedings, reasonable attorneys' fees, and defense costs, of any kind or nature,
including workers' compensation claims, of or by anyone whomsoever, resulting from or
arising out of the CONTRACTOR's negligent performance of this Agreement.
15. WORKERS' COMPENSATION. The CONTRACTOR shall comply
with all of the provisions of the Workers' Compensation Insurance and Safety Acts of
the State of California, the applicable provisions of Division 4 and 5 of the California
Government Code and all amendments thereto; and all similar state or Federal acts or
laws applicable; and shall indemnify, and hold harmless the CITY and its officers, and
employees from and against all claims, demands, payments, suits, actions, proceedings
and judgments of every nature and description, including reasonable attorney's fees
and defense costs presented, brought or recovered against the CITY or its officers,
employees, or volunteers, for or on account of any liability under any of said acts which
may be incurred by reason of any work to be performed by the CONTRACTOR under
this Agreement.
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16. INSURANCE. The CONTRACTOR, at its sole cost and expense,
shall purchase and maintain, and shall require its subcontractors, when applicable, to
purchase and maintain throughout the term of this agreement, the following insurance
policies:
� I A. If checked, Professional Liability Insurance (errors and omissions)
with minimum limits of $1,000,000 per occurrence.
B. Automobile insurance covering all bodily injury and property
damage incurred during the performance of this Agreement, with a minimum coverage
of $1,000,000 combined single limit per accident. Such automobile insurance shall
include non -owned vehicles.
C. Comprehensive general liability insurance, with minimum limits of
$1,000,000 combined single limit per occurrence, covering all bodily injury and property
damage arising out of its operation under this Agreement.
D. Workers' compensation insurance covering all of CONSULTANT's
employees.
E. The aforesaid policies shall constitute primary insurance as to the
CITY, its officers, employees, and volunteers, so that any other policies held by the
CITY shall not contribute to any loss under said insurance. Said policies shall provide
for thirty (30) days prior written notice to the CITY of cancellation or material change.
F. Said policies, except for the professional liability and worker's
compensation policies, shall name the CITY and its officers, agents and employees as
additional insureds.
G. If required insurance coverage is provided on a "claims made"
rather than "occurrence" form, the CONTRACTOR shall maintain such insurance
coverage for three years after expiration of the term (and any extensions) of this Agree-
ment.
H. Any aggregate insurance limits must apply solely to this Agree-
ment.
Insurance shall be written with only California admitted companies
which hold a current policy holder's alphabetic and financial size category rating of not
less than A VIII according to the current Best's Key Rating Guide, or a company equal
financial stability that is approved by the City's Risk Manager.
J. This Agreement shall not take effect until certificate(s) or other
sufficient proof that these insurance provisions have been complied with, are filed with
and approved by the CITY's Risk Manager. If the CONTRACTOR does not keep all of
such insurance policies in full force and effect at all times during the terms of this
Agreement, the CITY may elect to treat the failure to maintain the requisite insurance
as a breach of this Agreement and terminate the Agreement as provided herein.
17. LEGAL FEES. If any party brings a suit or action against the other
party arising from any breach of any of the covenants or agreements or any
inaccuracies in any of the representations and warranties on the part of the other party
arising out of this Agreement, then in that event, the prevailing party in such action or
dispute, whether by final judgment or out -of -court settlement, shall be entitled to have
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and recover of and from the other party all costs and expenses of suit, including
attorneys' fees.
For purposes of determining who is to be considered the prevailing party,
it is stipulated that attorney's fees incurred in the prosecution or defense of the action or
suit shall not be considered in determining the amount of the judgment or award.
Attorney's fees to the prevailing party if other than the CITY shall, in addition, be limited
to the amount of attorney's fees incurred by the CITY in its prosecution or defense of
the action, irrespective of the actual amount of attorney's fees incurred by the prevailing
party.
18. MEDIATION/ARBITRATION. If a dispute arises out of or relates
to this Agreement, or the breach thereof, the parties agree first to try, in good faith, to
settle the dispute by mediation in San Diego, California, in accordance with the
Commercial Mediation Rules of the American Arbitration Association (the "AAA") before
resorting to arbitration. The costs of mediation shall be borne equally by the parties.
Any controversy or claim arising out of, or relating to, this Agreement, or breach thereof,
which is not resolved by mediation shall be settled by arbitration in San Diego,
California, in accordance with the Commercial Arbitration Rules of the AAA then
existing. Any award rendered shall be final and conclusive upon the parties, and a
judgment thereon may be entered in any court having jurisdiction over the subject
matter of the controversy. The expenses of the arbitration shall be borne equally by the
parties to the arbitration, provided that each party shall pay for and bear the costs of its
own experts, evidence and attorneys' fees, except that the arbitrator may assess such
expenses or any part thereof against a specified party as part of the arbitration award.
19. TERMINATION. A. This Agreement may be terminated with or
without cause by the CITY. Termination without cause shall be effective only upon 60-
day's written notice to the CONTRACTOR. During said 60-day period the
CONTRACTOR shall perform all services in accordance with this Agreement.
B. This Agreement may also be terminated immediately by the CITY
for cause in the event of a material breach of this Agreement, misrepresentation by the
CONTRACTOR in connection with the formation of this Agreement or the performance
of services, or the failure to perform services as directed by the CITY.
C. Termination with or without cause shall be effected by delivery of
written Notice of Termination to the CONTRACTOR as provided for herein.
D. In the event of termination, all finished or unfinished Memoranda
Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the
CONTRACTOR, whether paper or electronic, shall immediately become the property of
and be delivered to the CITY, and the CONTRACTOR shall be entitled to receive just
and equitable compensation for any work satisfactorily completed on such documents
and other materials up to the effective date of the Notice of Termination, not to exceed
the amounts payable hereunder, and less any damages caused the CITY by the
CONTRACTOR's breach, if any. Thereafter, ownership of said written material shall
vest in the CITY all rights set forth in Section 6.
E. The CITY further reserves the right to immediately terminate this
Agreement upon: (1) the filing of a petition in bankruptcy affecting the CONTRACTOR;
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(2) a reorganization of the CONTRACTOR for the benefit of creditors; or (3) a business
reorganization, change in business name or change in business status of the
CONTRACTOR.
20. NOTICES. All notices or other communications required or
permitted hereunder shall be in writing, and shall be personally delivered; or sent by
overnight mail (Federal Express or the like); or sent by registered or certified mail,
postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or
telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall
be deemed received upon the earlier of (i) if personally delivered, the date of delivery to
the address of the person to receive such notice, (ii) if sent by overnight mail, the
business day following its deposit in such overnight mail facility, (iii) if mailed by
registered, certified or ordinary mail, five (5) days (ten (10) days if the address is
outside the State of California) after the date of deposit in a post office, mailbox, mail
chute, or other like facility regularly maintained by the United States Postal Service, (iv)
if given by telegraph or cable, when delivered to the telegraph company with charges
prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice,
request, demand, direction or other communication delivered or sent as specified above
shall be directed to the following persons:
To the CITY:
To the CONTRACTOR:
Chris Zapata, City Manager
City of National City
1243 National City Boulevard
National City, CA 91950-4301
Ruben Mendoza, Senior Vice President
Estrada Hinojosa Investment Bankers
437 J Street, Suite 212
San Diego, CA 92101
Notice of change of address shall be given by written notice in the manner
specified in this Section. Rejection or other refusal to accept or the inability to deliver
because of changed address of which no notice was given shall be deemed to
constitute receipt of the notice, demand, request or communication sent. Any notice,
request, demand, direction or other communication sent by cable, telex, telecopy,
facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or
delivered as specified in this Section.
21. CONFLICT OF INTEREST AND POLITICAL REFORM ACT
OBLIGATIONS. During the term of this Agreement, the CONTRACTOR shall not
perform services of any kind for any person or entity whose interests conflict in any way
with those of the City of National City. The CONTRACTOR also agrees not to specify
any product, treatment, process or material for the project in which the CONTRACTOR
has a material financial interest, either direct or indirect, without first notifying the CITY
of that fact. The CONTRACTOR shall at all times comply with the terms of the Political
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Reform Act and the National City Conflict of Interest Code. The CONTRACTOR shall
immediately disqualify itself and shall not use its official position to influence in any way
any matter coming before the CITY in which the CONTRACTOR has a financial interest
as defined in Government Code Section 87103. The CONTRACTOR represents that it
has no knowledge of any financial interests that would require it to disqualify itself from
any matter on which it might perform services for the CITY.
0 If checked, the CONTRACTOR shall comply with all of the
reporting requirements of the Political Reform Act and the National City Conflict of
Interest Code. Specifically, the CONTRACTOR shall file a Statement of Economic
Interests with the City Clerk of the City of National City in a timely manner on forms
which the CONTRACTOR shall obtain from the City Clerk.
The CONTRACTOR shall be strictly liable to the CITY for all damages,
costs or expenses the CITY may suffer by virtue of any violation of this Paragraph 21
by the CONTRACTOR.
22. MISCELLANEOUS PROVISIONS.
A. Computation of Time Periods. If any date or time period provided
for in this Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday,
then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next
day which is not a Saturday, Sunday or federal, state or legal holiday.
B. Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which, together, shall
constitute but one and the same instrument.
C. Captions. Any captions to, or headings of, the sections or
subsections of this Agreement are solely for the convenience of the parties hereto, are
not a part of this Agreement, and shall not be used for the interpretation or
determination of the validity of this Agreement or any provision hereof.
D. No Obligations to Third Parties. Except as otherwise expressly
provided herein, the execution and delivery of this Agreement shall not be deemed to
confer any rights upon, or obligate any of the parties hereto, to any person or entity
other than the parties hereto.
E. Exhibits and Schedules. The Exhibits and Schedules attached
hereto are hereby incorporated herein by this reference for all purposes.
F. Amendment to this Agreement. The terms of this Agreement may
not be modified or amended except by an instrument in writing executed by each of the
parties hereto.
G. Waiver. The waiver or failure to enforce any provision of this
Agreement shall not operate as a waiver of any future breach of any such provision or
any other provision hereof.
H. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.
I. Entire Agreement. This Agreement supersedes any prior agree-
ments, negotiations and communications, oral or written, and contains the entire
agreement between the parties as to the subject matter hereof. No subsequent
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party's counsel and advisors have reviewed this Agreement, (v) each party has agreed
to enter into this Agreement following such review and the rendering of such advice,
and (vi) any rule or construction to the effect that ambiguities are to be resolved against
the drafting party shall not apply in the interpretation of this Agreement, or any portions
hereof, or any amendments hereto.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date and year first above written.
CITY OF NATIONAL CITY
By:
Nick Inzunza,
APPROVED AS TO FORM:
George H. Eiser, III
City Attorney
ESTRADA-HINOJOSA
(Two signatures required for a corporation)
By:
(Name) Robert A. Estrada
(Title) Chairman & CEO
a endoza
(Title Senior Vice President
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FIRM SERVICES
11) What financial advisory services is your firm capable oifprovidin8? Die the type of services.
I
Estrada Hinojosa would provide ongoing support to the City. We are extremely familiar with city insners, and feel that
our expertise could be an advantage in addressing the financing needs of the City. If selected for this engagement, we
agree to provide our professional services and our facilities as Financial Advisor and agree to direct and coordinate all
programs of financing as may be considered and authorized.
We agree to perform the following duties normally performed by financial advisors and all other duties as, in
our judgment, may be neraecary or advisable:
1. We will conduct a survey of the financial resources of the City to determine the extent of its capacity to
authorize, issue and service debt. This survey will include an analysis of existing debt structure as compared with the
existing and projected sources of revenues which may be pledged to secure payment of debt service. In the event
revenues of existing or projected facilities operated by the City are to be pledged to repayment of the Debt Instruments
then under consideration, the survey will take into account any outstanding indebtedness payable from the revenues
thereof and additional revenues, if any, resulting from improvements to be financed by the Debt Instruments under
consideration. We will also take into account future financing needs and operations as projected by the staff and
consultants or other i.xia-tts, if any, employed by the City.
2. On the basis of the information developed by the survey described above, and other information and
experience available to us, we will submit to the City our recommendations on the Debt Instruments under consideration
including such elements as the date of issue, interest payment dates, schedule of principal maturities, portions of prior
payment, security provisions, and any other additional provisions designed to make the issue attractive to investors. All
recormnendations will be based upon our professional judgment with the goal of designing Debt lnstwnents which can
be sold under terms most advantageous to the City and at the lowest interest cost consistent with all other considerations.
3. We will advise the City of current bond market conditions, forthcoming bond issues and other general
information and economic data which might normally be expected to influence interest rates or bidding conditions so
that the date of sale of the Debt Instruments may be set at a time which, in our opinion, will be favorable.
4. We understand the City has retained, or will retain, firms of municipal bond attorneys (the "Bond Counsel")
whose fees will be paid by the City.
S. We will recommend the method of sale of the Debt Instruments that, in our opinion, is in the best interest of
the City and will proceed, as directed by the City, with one of the following methods:
a. Advertised Sale- We will supervise the sale of the Debt Instrument at a public sale in accordance
with procedures set out herein. We reserve the right, alone or in conjunction with others, to submit a bid for any Debt
Instruments issued ruder this Agreement that the City advertises for competitive bids. In compliant-1- with Rule G-23 of
the Municipal Securities Rulemaking Board, we will request consent to bid in writing, in any instance wherein we elect
to bid, prior to submitting a bid for each installment of Debt Instruments.
b. Nepptiateri Sale- We will recommend one or more investment banking firms as
an
underwriting syndicate for the purposes of negotiating the purchase of Debt Instruments and in no event willrs we
we
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EXHIBIT "A"
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participate either directly or indirectly in the underwriting of the Debt Instruments. We will collaborate with any senior
managing underwriter selected and Counsel to the underwriters in the preparation of the Official Statement or Offering
Memorandum. We will cooperate with the underwriters in obtaining any Blue Sky Memorandum and Legal Investment
Survey, preparing the Bond Purchase Contract, Underwriters' Agreement and any other related documents. The costs
thereof, including the printing of the documents, will be paid by the underwriters.
c. Private Placement: Upon authorization by the City and acting in its behalf, we will place privately
the Debt Instruments directly with institutional investors. We will prepare and provide to the prospective purchasers a
Limited Offering Memorandum and other related documents.
6. When appropriate, we will advise financial publications of the forthcoming sale of the Debt Instruments and
provide them with all pertinent information.
7. We will coordinate the preparation of the Notice of Sale and Bidding Instructions, Official Statement,
Official Bid Form and such other documents as may be required. We will submit to the City all such documents for
examinations, approval and certification. After such examination, approval and certification, we will provide the City
with a supply of all such documents sufficient to its needs and will distribute by mail sets of the same to prospwtive
bidders and to banks, life, fire and casualty insurance companies, investment counselors and other prospective
purchasers of the Debt Instruments. We also provide sufficient copies of the Official Statement to the purchaser of the
debt Instruments in accordance with the Notice of Sale and Bidding Instructions.
8. We will, after consulting the City, arrange for such reports and opinions of recognized independent
consultants we deem necPcc ry and required for the successful marketing of the Debt Instruments.
9. Subject to the approval of the City, we will organize and make arrangements for such information meetings
as, in our judgment, maybe necessary.
10. We will make recommendations to the City as to the advisability of obtaining a credit rating, or ratings, for
the Debt Instruments as, in our opinion, is required for submission to the appropriate company, institution or institutions.
In those cases where the advisability of personal presentation of information to the rating agency, or agencies, may be
indicated, we will arrange for such personal presentations.
11. We will make recommendations to the City as to the advisability of obtaining municipal bond insurance or
other credit enhancement, or qualifications for same, for the Debt Instruments and, when directed by the City, we will
coordinate the preparation of such information as, in our opinion, is required for submission to the appropriate company,
institution or institutions. In those cases where the advisability of personal presentation of infonnation to the appropriate
company, institution or institutions may be indicated, we will arrange for such personal presentations.
12. We will assist the staff of the City at any advertised sale of Debt Instruments in coordinated the receipt,
tabulation and comparison of bids and we will advise the City as to the best bid. We will provide the City with our
recommendations as to acceptance or rejection of such bid.
13. As soon as a bid for the Debt Instruments is accepted by the City, we will proceed to coordinate the efforts
of all concerned to the end that the Debt Instruments may be delivered and paid for as expeditiously as possible. We
will assist the City in the preparation or verification of final closing figures incident to the delivery of the Debt
Instruments.
14. We will maintain liaison with Bond Counsel in the preparation of all legal documents pertaining to the
authorization, sale and issuance of the Debt Instruments. Bond Counsel will provide an unqualified legal opinion as to
the legality of the issuance of the Debt Instruments at the time of delivery.
15. If requested, we will counsel with the City in the selection of a Paying Agent/Registrar for the Debt
Instruments, and will assist in the preparation of agreements pertinent to these services and the fees incident thereto.
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16. In the event formal verification by an independent auditor or any calculations incident to the Debt
Instruments is required, we will make arrangements for such services.
17. We agree to do, or cause to be done, all work incident to pertaining of the Debt Instruments, obtaining
approval, as may be required by the Attorney General, registration by the Comptroller of Public Accounts and delivery
to the purchaser.
18. After the closing of the sale and delivery of the Debt Instruments, we will deliver to the City a schedule of
annual debt service requirements on the Debt Instruments. In coordination with Bond Counsel, we will arorre that the
Paying Agent/Registrar has been provided with a copy of the authorizing ordinance, order or resolution.
19. We will attend any and all meeting of goveming body of the City, its staff, representatives or committees
as requested at all times when we may be of assistance or service and the subject of financing is to be dismissed.
20. We will advise the City and its staff of changes, proposed or enacted, in Federal and State laws and
regulations which would affect the municipal bond market.
21. We will work with the City, its staff and any consultants employed by the City in developing financial
feasibility studies and analyzing alternative financing plans.
ADDITIONAL SERVICES
In addition to the services set out above, we agree to provide the following services when so requested:
1. We will provide our advice as to the investment of certain funds of the City. We will, when so directed,
purchase those investments authorized to be purchased and we will charge a normal and customary commission for each
such transaction.
2. We will provide our advice and assistance with regard to exercising any call and/or refunding of any
outstanding Debt Instruments.
3. We will provide our advice and assistance in the development of, and financing for, any capital
improvement programs of the City.
4. We will provide our advice and assistance in the development of the long-range financing plan of the City.
5. We will provide any other financial planning services as may be requested by the City.
32
EXHIBIT "A"
Page 3 of 3
1
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1. Urban Futures, Inc.
3111 N. Tustin Ave, Ste 230
Orange, CA. 92865-1753
Contact Person:
Douglas P. Anderson
Ph: (714) 283-9334
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For any single issue in excess Principal-$175/hr
of $25,000,000, the financial . Senior Staff-$160/hr
advisor fee will be $1,500 per Associate Staff-$125/hr
million over and above . Asst Level-$75/hr
$25,000,000.
Such fee shall become payable
only upon. delivery by the City
of such bonds. In addition,
the Financial Advisor shall be
reimbursed.for direct out-of-
pocket expenses and for legal
expenses, if a competitive bid
situation is called for, out of
the proceeds from the financing.
proposal to provide Financial Advisory Services
ee ..
$ 21,500•up to and including .• $1,000,000
$ .24,500 up to and including $ 2,000,000
$ 27,500 up to and including $ 3,000,000
$ 30,500 up to arid including • $ 4,000,000.
$ 33,500.up to and including . $ 5,000,000
S. ' 35,500 up to and including . $.6,000,000
$ '37,500.up to'and including.:. $ 7,000,000
39,500.up to and including, $ 8,000,000
41,500 up to and including $ 9,006,000
43,50Q. up .to'and Including. . $10,000,000
'45,500 up to and including $11,000,000
47,500 up to and•including . $12,000,000
49
,500 up to and including • $13,000,000
51,500.up to and.including• $14,000,000.
'53,500 .up.to and including $15,000,000
55,500rip. .to and including • • $16,000,00
57,500 up to and Including $17,000 000
59,500 up to. and including •• $18,000,000
$ 61,500 up to.and.including $19,000,000
$ 63,500 up to and including. $20,000;060
$ . _ 65,600 up to and including •$21,000,000.
$ • 67,500up.to And including• ••• $22,000,000
$ • 69,500 up to and including . $23,000,000
$ 71,500 up to and including : .$24,000,000
$ . • 73,500 up to and including '$25,000,000
Name:.: ;.
Public Financial Management
660 Newport Center Dr
Suite 750
Newport Beach, CA 92660-6408
Contact Person:
Keith D. Curry
Managing Director
Ph: (949) 721-9422
Fax: (949) 721-9437
www.pfm.com
3. Estrada Hinojosa
437 J Street, Suite 212
San Diego, CA 92101
Ph: (619) 234-7783.
Fax: (619) 234-1576
Contact Person:
Robert A. Estrada
Chairman & CEO
Ruben Mendoza
Senior Vice President
rmendoza n,estradhinoiosa.com
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PFM proposes to be' compensated, at an.houriy.basis for all non -transactional
' •transactional services as follows:' . •
Managing Director—$250/hr . •
Senior Managing Consultant--$200/hr
• Consultant--$190/hr .
Expect to be reimbursed at cost for expenses incurred in the course of the
Engagement. Reimbursable, expenses include costs related to: travel, meals,
Lodging, communications, reproduction, graphics, postage and other
'Miscellaneous costs incurred in.serving the City' during this engagement,
Appropriate documentation and third party receipts will be provided with
Each invoice: Th.e total expenses for any transaction will be capped at $750.
Base Fee - Any. issue - $7,500 • • '
• Plus = $12:50 per $1,000 up to $250,000 or $10,625 for $250,000 Bonds
Plus - $11.50 per $1,000 next $250,000 or $13,500 for 5500,000 Bonds .
Plus -. $7.00 per $1,000 next $500,000. or $17,000 for1$1,0.00,000 Bonds
Plus - $4.75 per $1,000 next $1,500,000 or $24,125 for $2,500,000 Bonds
Plus - $2.75.per $1,000 next $2,500,000' or $31,000 for $5,000,000 Bonds ••
Plus - $1.50 per $1,000 next $5,000,000 or $38,500 for $10,000,000 Bonds
Plus - $1.25 per 1.000 over $10,000,000 •
Will charge in addition to Financial Advisory Fee, a computer lee to be
negotiated on a case -by -case basis. On Grant/Loan Programs, the fees
set forth above will, be used to compute a fee.based on the total project
cost, plus out-of-pocket expenses as set forth below:. ,. .
Estrada Hinojosa will •bill theissuer at Closing for each'_issue of Obligations
A net amount which will include a fee calculated on the above schedule as
Well as costs and expenses, where applicable; incurred on behalf of the issuer
For the Bond Attorneys, preparation, printing, and distribution of the Notice
Specific Assignments
Transaction Fees
Competitive.$45,000
Negotiated $40,000
Add'l Fees:
SLGS Subscription-
Escrow---$5,000
Open Market
Securites-Escrow
$10,000
Open Market
Securities -Reserve
$5,000
Principal/Senior
Bankers-$200/hr
Other
Professionals
$125/hr
Administrative
Support
$75/hr
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Fee
andAmt. Additionalpees
Specific Assignments
Of Sale, Official Statement, Uniform Bid Form or Private Placement .
Memorandum, independent consultants, out-of-pocket expenses, information
Meetings, if any, presentations to rating agencies and rating fees, if any,
Printing of Obligations, and all appropriate costs and expenses associated
With the closing and delivery of the Obligations.
Revenue Bond Issues shall be the amount shown plus a 40% additional charge.
Advanced Refunding Issues shall be the amount shown plus a 20% additional charge.
For any issue of Advanced Refunding Bonds and/or other Debt Instruments
Involving Escrow Agreements, in addition to Financial,Advisory Fee, a computer
Fee to be negotiated on a case -by -case basis.
City of National City, California
COUNCIL AGENDA STATEMENT
19
A/IEETING DATE May 4, 2004 AGENDA ITEM NO.
ITEM TITLE
Resolution Awarding Financial Advisor Services for the City of National City to Estrada Hinojosa
Investment Bankers from May 5, 2004 to May 5, 2007
PREPARED BY Chris Zapat DEPARTMENT
Phone: 619/ 6-4240
EXPLANATION
Please see attached explanation
City Manager
r
Environmental Review X N/A
Financial Statement
Approved By: v F /•
Fin ir
Funds are available in Non -Departmental Experts and Consultants, Account 001-409-000-215nce. fherec °ee ' on an
as -needed basis at the rate of $200/hour for Principal/Senior Bankers; $125/hour for Other Professionals; and
$75/hour for Administrative Support. Account No.001-409-000-213
STAFF RECOMMENDATION
Staff recommends hiring Estrada Hinojosa Investment Bankers as the City's Financial Advisor to include all areas
specified in Exhibit A.
BOARD / COMMISSION RECOMMENDATION
421_/?Zell-
ATTACHMENTS ( Listed Below) Resolution No. 2(ib4-1
1. Explanation
2. Resolution
3. Proposed Agreement
4. Fee Schedules — All Firms
5. Biography — Estrada Hinojosa
A-200 (9,99)
ATTACHMENT 1
City of National City
Office of the City Manager
Chris Zapata - City Manager
1243 National City Boulevard, National City, CA 91950
Phone: (619) 336-4240 Fax: (619) 336-4327
TO: Mayor & Council
FROM: Chris Zapata, City Manager
RE: RECOMMENDED FINANCIAL ADVISOR
DATE: April 21, 2004
A Request for Qualifications for National City Financial Advisor was released last
month. The purpose of the Financial Advisor is to assist the City in review of major
financial transactions, develop financing scenarios, prepare a debt management plan,
analyze fiscal policies and provide investment advice.
These services are necessary with the scope and scale of current projects underway and
anticipated. There is a need to review and maximize investment opportunities that may
be available with current assets in coordination with the Community Development
Corporation financial advisor as well.
Staff conducted interviews of three qualified financial advisor firms for the City on
Friday, April 16th. The review panel consisted of the Finance Director from CDC and the
City as well as myself.
Estrada Hinojosa was the unanimous choice of the panel based on these factors:
• Bi-national experience
• Ethics and oversight involvement of firm on federal boards
• Experience working with City Council and staff to provide clarity on
complex financial problems through training (Le. Municipal Bonding 101)
• San Diego based office
• Understanding of National City opportunities and threats
• Currently co -financial advisor to Port of San Diego
• Principal's experience in working with public and corporate financing as
well as City Managers and Finance staff
® Recycled Paper • www.ci.national-city.ca.us • e-mail: cmo@ci.national-city.ca.us
Recommended Financial Advisor
Page Two
There was not a large variation in the fee costs for services. Attached is the fee schedule
for each firm. Also attached is a biography of the firm as well as the Request For
Qualifications to firms. The submittals by the companies are also available for your
review as well as public review upon request.
RESOLUTION NO. 2004 — 76
RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF NATIONAL CITY
AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT
WITH ESTRADA HINOJOSA INVESTMENT BANKERS FOR
FINANCIAL ADVISING SERVICES
WHEREAS, the City desires to employ a consultant to provide financial
advising services as needed; and
WHEREAS, the City has determined that Estrada Hinojosa Investment
Bankers is a financial advisory and bond underwriting firm, and is qualified by
experience and ability to perform -the services desired by the City, and is willing to
perform such services.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City
of National City herby authorizes the Mayor to execute an agreement with Estrada
Hinojosa Investment Bankers to perform financial advising services. Said agreement is
on file in the office of the City Clerk.
PASSED and ADOPTED this 4th day of May, 004.
Nic nzor
ATTEST:
Micha'eI R. Dalla
City Clerk
APPROVED AS TO FORM:
George H. Eiser, Ill
City Attorney
Passed and adopted by the Council of the City of National City, California, on May 4, 2004, by
the following vote, to -wit:
Ayes: Councilmembers Inzunza, Morrison, Natividad, Parra, Ungab.
Nays: None.
Absent: None.
Abstain: None.
AUTHENTICATED BY:
NICK INZUNZA
Mayor of the City of National City, California
Jerk of the
Cit
y
f National City, California
By:
Deputy
I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of
RESOLUTION NO. 2004-76 of the City of National City, California, passed and adopted by the
Council of said City on May 4, 2004.
City Clerk of the City of National City, California
By:
Deputy
City of National City
Office of the City Clerk
1243 National City Boulevard, National City, California 91950-4397
Michael R. Dalla, CMC - City Clerk
(619) 336-4228 Fax: (619) 336-4229
May 12, 2004
Ruben Mendoza, Senior Vice President
Estrada Hinojosa Investment Bankers
437 J Street, Suite 212
San Diego CA 92101
Dear Mr. Mendoza,
On May 4, 2004, Resolution No. 2004-76 was passed and adopted by the
City Council of the City of National City, authorizing the Mayor to execute
an agreement with Estrada Hinojosa Investment Bankers for financial
advising services.
We are forwarding a certified copy of the above Resolution and a fully
executed original agreement.
Sincerely,
Martha L. Alvarez, CMC
Deputy City Clerk
/mla
Enclosure
cc: City Manager
File No. C2004-21
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