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HomeMy WebLinkAboutContract 52419 DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C CITY SECRETARY CONTRACTNO.,j If� ■ KROLL BOND RATING AGENCY May 1,2019 Alex Laufer Debt and Compliance Manager Department of Financial Management Services City of Ft.Worth,Texas 200 Texas Street Ft.Worth,Texas 76102 Re: Published Rating of$107,760,000 City of Fort Worth,Texas General Purpose Bonds, Series 2019;$8,020,000 City of Fort Worth,Texas Tax Notes,Series 2019 Dear Mr.Laufer, This letter agreement sets forth the process and terms pursuant to which Kroll Bond Rating Agency,Inc. ("KBRA") will assign a published rating ("Rating") to Published Rating of$107,760,000 City of Fort Worth, Texas General Purpose Bonds, Series 2019; $8,020,000 City of Fort Worth, Texas Tax Notes, Series 2019("Bonds"). Set forth below are descriptions of the services to be provided by KBRA and the steps in our rating process,as well as the related fee arrangements and other terms. If this letter agreement meets with your approval, please sign in the space below to evidence your acceptance of this letter agreement and return a signed copy to me. The deliverables, process, fees and terms of this letter agreement are applicable to each Rating issued pursuant to this letter agreement.For the avoidance of doubt,the use of any singular reference to a Rating in this letter agreement applies to each Rating issued pursuant to this letter agreement. Deliverables Post Committee Feedback.- We will orally provide you post committee feedback once the rating committee has determined what it expects the rating to be ("Post Committee Feedback"). The Post Committee Feedback is for your use only and may not be shared or disseminated in any manner. If you elect to proceed after receiving Post Committee Feedback, KBRA will continue its rating process and provide the below deliverables. Rating Letter: KBRA will issue a rating letter to you ("Rating Letter") that will contain the Rating. Finalization of the Rating and delivery of the Rating Letter are subject to the satisfactory completion of all aspects of KBRA's rating process,as determined by KBRA in its sole discretion. Rating Report. KBRA will prepare and publish a Rating Report that summarizes the rationale for the rating ("Rating Report"). A draft of the Rating Report will be sent to you prior to any publication or release of such report. The draft will be sent (i) to inform you of the critical information and principal considerations upon which the credit rating is based, and (ii) to afford you an opportunity to submit additional factual information not previously available to KBRA,to clarify any factual misperceptions, or to identify any confidential information.KBRA shall duly evaluate any comments made by you;however, KBRA is not obliged to consider any drafting or editorial changes proposed by you, other than those DECEIVED Page 1 JUN 17 2019 OFFICIAL RECORD 805 Third Ave.(29t'Floor I New York,NY 10022 1 T.212 702 0707(F:212 702 4500 1 www.kb CornC4YGF FORT 1llORTHCorn CITY SECRETARY M YSECREM FT. WORTH, Tx DocuSign Envelope 1D:75A24201-B691-4535-9368-OD280234CA5C • ■ i KROLL BOND RATING AGENCY made to correct factual errors or remove references to confidential information.The draft Rating Report is for your use only and may not be shared with third parties other than your agents or advisors that have a need to know such information and who are bound by appropriate confidentiality obligations. Surveillance: KBRA will conduct periodic surveillance of the Bonds,including potential publication of updates including surveillance reports(each,a"SurveiIIance Report"). Process The process for the Rating will have three (3)major phases. A broad overview of each phase is set forth below.The time required to complete each phase may vary materially from KBRA's initial estimates if(i) KBRA becomes aware of any information that KBRA determines, in its sole discretion, may require additional unexpected diligence or research, or (ii) there is a delay in your provision of information to KBRA that, in KBRA's sole discretion,is required for KBRA to perform its analysis. Phase I: Review of the relevant financial information and documents. Ongoing conversations with your representatives. Information meetings. Review of preliminary offering documents and draft issuance documents. Issuance of Post Committee Feedback Phase II: If applicable,review of any updates to underlying analysis. If applicable,any other aspects of KBRA's review which it views to be material to a potential rating Preparation and issuance of the Rating Letter and Rating Report. Phase III: KBRA will perform ongoing periodic surveillance of the issuance including potential publication of updates. Rating Fees The fees for the rating services outlined herein are set forth below. Phase I Fee: $25,000 Phase II Fee: $15,000 Phase III Annual Fee: $0 Payment:The Phase I Fee and Phase II Fee,as reflected above, will be due upon KBRA's issuance of the Rating Letter. The Phase III Annual Fee, as reflected above, will be due on each anniversary of the issuance of the Rating Letter.All fees are payable within five(5)days after receipt of an invoice.All fees are exclusive of and subject to applicable sales taxes.The fees are non-refundable. Page 2 805 Third Ave.129th Floor I New York,NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C i KROLL BOND RATING AGENCY Additional Fees If, subsequent to the execution of this letter agreement, any of the following occur, an additional fee (the "Additional Fee")will be due: (i) you request expedited delivery of the Rating Letter; (ii) the details or specifications of the Bonds change materially such that additional document review and analysis is required in order for KBRA to rate the Bonds;and/or (iii) a Rating Letter is required but has not been issued by the date that is 180 calendar days after the date of this letter agreement for any reason other than KBRA's breach of this letter agreement,as described further below. Any Additional Fee will be dependent upon various factors, including the type of the proposed change or amendment and the complexity of additional review or analysis that will, in KBRA's sole opinion, be required to perform the necessary work.Any such Additional Fee will be agreed to by the parties prior to KBRA's issuance of an invoice. Payment of fees is not contingent on the successful offering of the Bonds, your use of the Rating or our issuance of any particular rating. Term and Termination This letter agreement shall remain in effect so long as KBRA is maintaining the Rating, unless this letter j agreement has been terminated as provided herein. Either party may terminate this letter agreement at any time by delivering written notice to such effect to the other party. If such termination takes place before the completion of Phase II,a"Break-up Fee,"as defined below, will be due and payable. The termination of this letter agreement may result in KBRA's withdrawal of any then-existing Rating. If a Rating Letter is not yet issued by the date that is 180 calendar days after the date of this letter agreement for any reason other than KBRA's breach of this letter agreement,then on such date(a) if you elect to proceed with the rating process (i)KBRA may request that you provide up-to-date information to allow us to complete the rating process, and(ii)a fee commensurate with the work performed as of such date,as detailed in this letter agreement,shall be due and payable,along with any Additional Fees that are commensurate with the review and analysis of such materials, in KBRA's sole opinion, that will be required to perform the work, or(b)if you elect not to proceed with the rating process,then on such date a"Break-up Fee,"as defined below,will be due and payable. Break-up Fee: In the event this letter agreement is terminated before the completion of Phase II for any reason other than KBRA's breach of its obligations hereunder, a break-up fee commensurate with the work performed as of the date of such termination, as detailed in this letter agreement, shall be due and payable. Page 3 805 Third Ave.1 291 Floor I New York, NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C i KROLL BOND RATING AGENCY General 1. In issuing and maintaining the Rating, KBRA relies on information it receives from you or at your request or direction and from other sources KBRA believes to be credible. The Rating, and the maintenance of the Rating, may be affected by KBRA's opinion of the information received from you or at your request or direction in connection with this letter agreement.You agree to use good faith efforts to cooperate, in any manner reasonably requested, with any verification procedures performed by KBRA or its agents or at KBRA's request. For so long as this letter agreement is in effect, in connection with the Rating provided hereunder, you warrant that you will provide, or cause to be provided, as promptly as practicable, to KBRA and/or its agents (a) all information requested by KBRA in accordance with its ratings process or that may be necessary for KBRA to satisfy its obligations pursuant to any applicable legislation in connection with the issuance of its ratings, or as required by any regulatory or legal authorities, including, without limitation, third-party information in your possession to the extent you have the legal right to disclose such information,after due inquiry,and(b)any other material information relevant to the Rating and surveillance of the Rating, including, without limitation, information on material changes to information previously provided by you, or at your request or direction, to KBRA. The failure to provide such information may result in KBRA's termination of this letter agreement or, in the case of surveillance, the downgrade or withdrawal of the Rating. You further warrant that all information provided to KBRA and its agents by you or at your request or direction regarding the Rating or surveillance of the Rating, as such information may be updated from time to time in accordance with (b)above, contains and will contain no untrue statement of material fact and does not and will not omit a material fact necessary in order to make such information, in light of the circumstances in which it was provided, not misleading. You acknowledge that the Rating provided pursuant to this letter agreement is based on the information you provide or another party at your request or direction provides to KBRA,and KBRA will not independently verify the accuracy or completeness of such information. Until a Rating is issued and so long as this letter agreement is in effect,you agree to and will cause third parties providing information at your request or direction to reasonably cooperate in providing additional information if requested by KBRA as may be necessary for KBRA's compliance with any applicable laws or regulations. 2. You understand that KBRA is relying on your representations, warranties and covenants and if, for any reason, you breach your representations, warranties or covenants at any time, you shall provide prompt written notice to KBRA and if possible,promptly correct the relevant information. The failure of any of your representations, warranties or covenants to be true at any time may affect KBRA's ability to issue and maintain the Ratings,result in the downgrade or withdrawal of the Ratings and/or limit KBRA's ability to issue ratings for you in the future as we may no longer be permitted to reasonably rely on your representations. To the extent permitted by applicable law, you will indemnify KBRA for all losses, damages, liabilities, judgments, costs, charges and expenses (including reasonable legal fees and expenses) ("Losses") (a)resulting from a breach of the representations, warranties, and covenants in this letter agreement, including but not limited to all Losses arising from claims asserted by any third party against KBRA arising from such breach, or(b)that arise out of or relate to any claim that the information provided by you or at your request or direction infringes or violates the intellectual property rights of a third party, except in either case, to the extent such Losses are judicially determined to result from the gross negligence or willful misconduct of KBRA. Page 4 805 Third Ave.129t'Floor I New York, NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C KROLL BOND RATING AGENCY 3. KBRA reserves the right in its sole discretion to raise, lower or withdraw any rating at any time for any reason it deems sufficient. KBRA may take such action notwithstanding any request for a withdrawal of a rating or termination of this letter agreement. KBRA reserves the right to refuse to complete the Rating if you violate any of the terms of this letter agreement, including if you fail to provide KBRA with accurate, complete,timely or reliable information required by this letter agreement. Under any of the foregoing circumstances, no fees paid to KBRA will be returned. In the event that KBRA issues a Rating pursuant to this letter agreement, such Rating reflects KBRA's then-current opinion of the creditworthiness of the Bonds. The Rating issued hereunder will be subject to the qualifications and description set forth on KBRA's Rating Letter and sources referenced therein. The Ratings and other views of KBRA are statements of opinion and not statements of fact. They are not a recommendation or suggestion, directly or indirectly, to you or any other person, to buy, sell, make or hold any investment, loan or security or to undertake any investment strategy with respect to any investment, loan or security or any issuer. Ratings do not comment on the adequacy of market price, marketability, the suitability of any investment, loan or security for a particular investor (including without limitation, any accounting and/or regulatory treatment), or the tax-exempt nature or taxability of payments made in respect of any investment, loan or security. You acknowledge that KBRA is not your advisor and is not providing you any financial advice, or any legal, auditing, accounting, appraisal, j valuation or actuarial services. The Ratings should not be viewed as a replacement for such advice or services. Nothing in this letter agreement is intended to or should be construed as creating a fiduciary relationship between you and us or between us and any user of the Ratings described herein. 4. For purposes of this letter agreement, "Confidential Information" shall mean information provided to KBRA by you,or at your request or direction,in connection with the Rating and is marked or otherwise indicated in writing, including, without limitation email, that such information is "Confidential." Notwithstanding the foregoing, information disclosed by you or at your request or direction to KBRA shall not be deemed to be Confidential Information, and KBRA shall have no obligation to treat such information as Confidential Information, if such information (a) was known by KBRA or its affiliates at the time of such disclosure and was not known by KBRA to be subject to a prohibition on disclosure,(b) was known to the public at the time of such disclosure, (c)becomes known to the public (other than by an act of KBRA or its affiliates) subsequent to such disclosure, (d) is disclosed to KBRA or its affiliates by a third party subsequent to such disclosure and KBRA reasonably believes that such third party's disclosure to KBRA or its affiliates was not prohibited, (e) is developed independently by KBRA or its affiliates without reference to the Confidential Information, (f) has been aggregated or modified such that it is no longer identifiable as attributable to the Bonds, or (g) is approved by you for public disclosure, or is otherwise publicly disclosed by you. For the avoidance of doubt, with respect to (g), any information contained within a Rating Report that is reviewed and authorized for publication by you,your agents,or advisors will not be deemed Confidential Information. Except as otherwise provided herein, KBRA shall not disclose Confidential Information to third parties. KBRA may disclose Confidential Information to its employees, consultants,representatives,financial and legal advisors and affiliates, provided such persons or entities are bound by confidentiality obligations similar to those contained in this letter agreement. KBRA may use Confidential Information to assign, raise, lower, or withdraw a Rating, provided that, in each case, the Confidential Information is not presented publicly.KBRA may use and share Confidential Information with any of its affiliates or agents engaged in the ratings or other financial services businesses who are bound by confidentiality obligations similar to those contained in this letter agreement, for modeling, benchmarking and research purposes, Page 5 805 Third Ave.i 29t'Floor I New York,NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C ■ KROLL BOND RATING AGENCY and all such models, benchmarks and research shall be the sole property of KBRA and its affiliates, provided that, in each case, Confidential Information is not presented publicly in a way that can be attributed to you. KBRA reserves the right to use, publish, disseminate, or license others to use or disseminate any non-Confidential Information provided by you, or at your request or direction, to the extent such information is contained in a product produced by KBRA or its affiliates. KBRA may (a) disclose Confidential Information to the extent (i) necessary to defend itself in a proceeding before a legal, governmental or administrative authority, or(ii) requested or required by law, regulation, order or subpoena of a judicial or governmental authority or auditor, and(b)make publicly available any Ratings or opinions regarding issuers, securities, or transactions that are based on Confidential Information. You agree that, to the best of your knowledge, there are no third parties whose rights would be adversely affected by publication pursuant to clause(b), above.Nothing herein shall prohibit or restrict the rights of current or former KBRA personnel to disclose Confidential Information in a manner that is protected or required by the whistleblower provisions of any applicable law or regulation. 5. KBRA will make the Rating publicly known by issuing a press release and posting the Rating to kbra.com. Notwithstanding anything to the contrary herein, KBRA reserves the right to use, publish, disseminate, or license others to use or disseminate the Rating provided pursuant to this letter agreement and any analytical reports, including the rationale for the Rating, and including with respect to a Rating that has been withdrawn, regardless of the reason for such withdrawal, unless otherwise provided in this letter agreement. Any analytical reports published by KBRA are not issued by or on behalf of you or at your request. KBRA may publish explanations of KBRA's rating methodology from time to time and nothing in this letter agreement shall be construed as limiting KBRA's ability to modify or refine its rating methodology as KBRA deems appropriate. 6. KBRA does not and cannot guarantee the accuracy, completeness, or timeliness of the information relied on in connection with a Rating or the results obtained from the use of such information. KBRA GIVES NO EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. KBRA, its affiliates or third party providers, or any of their officers, directors, shareholders, employees or agents shall not be liable to you,your affiliates or any third parties asserting claims,directly or indirectly,for any inaccuracies, errors, or omissions, in each case regardless of cause, actions,damages (consequential, special, indirect, incidental, punitive, compensatory, exemplary or otherwise), claims, liabilities, costs, expenses, legal fees or losses (including, without limitation, lost income or lost profits and opportunity costs) in any way arising out of or relating to any Rating provided hereunder or the related analytic services even if advised of the possibility of such damages or other amounts except to the extent such damages or other amounts are judicially determined to result from gross negligence or willful misconduct of KBRA. In furtherance and not in limitation of the foregoing, KBRA will not be liable to you, your affiliates or any third parties asserting claims with respect to any decisions alleged to be made by any person based on anything that may be perceived as advice or recommendations. Preliminary feedback or any discussions with KBRA's analysts shall not be deemed to be advice or opinions regarding securities or business operations. KBRA will not be liable to you, your affiliates, or any third parties for disclosures by any governmental, legal or regulatory authorities(collectively, "Governmental Entities") of any Confidential Information.The provisions of this paragraph shall apply regardless of the form of action, damage, claim,liability, cost,expense,or loss,whether in contract,statute,tort(including, without limitation,negligence),or otherwise.Neither party waives any protections,privileges,or defenses Page 6 805 Third Ave.129t'Floor I New York, NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C KROLL BOND RATING AGENCY it may have pursuant to law, including, without limitation,the First Amendment of the Constitution of the United States of America. 7. Notwithstanding anything to the contrary, you understand and agree that KBRA has not consented to, and will not consent to, (a) being named an"expert"pursuant to applicable securities laws including, without limitation, Section 7 of the Securities Act of 1933, or (b) identification of KBRA in any registration statement, prospectus or other offering document (including through incorporation) within the meaning of applicable securities laws such that KBRA could reasonably be expected to be considered an "expert" pursuant to applicable securities laws including, without limitation, Section 7 of the Securities Act of 1933. 8. You understand that current and future laws and regulations relating to rating agencies, as such laws and regulations may be amended or supplemented,may apply to KBRA and KBRA may be required to comply with such laws and regulations by implementing internal policies and procedures. You acknowledge that our services and any Ratings contemplated hereunder may be subject to such laws and regulations and you agree to cooperate with KBRA if your cooperation is necessary for KBRA's compliance. Nothing in this letter agreement shall prevent KBRA from acting in accordance with applicable laws and regulations and KBRA's policies, as published from time to time, in furtherance of such laws and regulations, including, but not limited to publicly disclosing any information provided in connection with the rating,to the extent that KBRA in good faith determines is necessary to be disclosed pursuant to Rule 17g-7 of the Securities Exchange Act of 1934, or if required by any other law or by Governmental Entities. 9. Nothing in this letter agreement, or the Rating when issued, is intended or should be construed as creating any rights on behalf of any third parties, including, without limitation, any recipient of the Rating. No person is intended as a third party beneficiary of this letter agreement or of the Rating when issued. 10. This letter agreement shall be binding on, and inure to the benefit of,the parties hereto and their successors and assigns. 11. In the event that any term or provision of this letter agreement shall be held to be invalid,void,or unenforceable,then the remainder of this letter agreement shall not be affected, impaired, or invalidated, and each such term and provision shall be valid and enforceable to the fullest extent permitted by law. 12. This letter agreement supersedes any other agreement and/or terms and conditions relating to the information provided to KBRA in relation to the Rating,including, without limitation, any non-disclosure or confidentiality agreements,or terms and conditions of any website of the issuers or its agents,such as a "click-through" agreement, and constitutes the complete and entire agreement between the parties regarding the subject matter of this letter agreement. This letter agreement may not be amended except in a writing signed by authorized representatives of both parties. 13. The parties to this letter agreement do not waive, and reserve the right to contest, any issues regarding sovereign immunity,the applicable governing law and the appropriate forum for resolving any disputes arising out of or relating to this letter agreement. Page 7 805 Third Ave.129t'Floor I New York, NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C F . , KROLL BOND RATING AGENCY 14. This letter agreement may be executed in counterparts(which may be exchanged by email),each of which shall be deemed an original,but which together shall constitute one and the same instrument. 15. This letter agreement, the Rating Letter, and any Rating Report or Surveillance Report shall be governed by the internal laws of the State of New York. The parties irrevocably agree that the state and federal courts of New York located in the County of New York shall be the exclusive forums for any dispute arising out of or relating to this letter agreement and the parties hereby consent to the personal jurisdiction of such courts. 16. The terms and conditions of this letter agreement are to be kept confidential between the parties. Either party may disclose the terms of this letter agreement as required by law,and to its agents,advisors, auditors and consultants as necessary, provided that such recipients are bound by appropriate confidentiality obligations. [There is no further text on this page] Page 8 805 Third Ave.129't'Floor I New York, NY 10022 1 T:212 702 0707 1 F:212 702 4500 1 www.kbra.com DocuSign Envelope ID:75A24201-B691-4535-9368-OD280234CA5C The offer of services contained in this letter agreement will expire if not signed and returned to us on or before May 14,2019. We look forward to working with you.If you have any questions,please call me at 646.731.2344. Sincerely, C �� f' sd by: 9F EE17697 E9... Ajay�unnarkar Chief Financial Officer Kroll Bond Rating Agency,Inc. Agreed and accepted: City of Ft.W rth, eSas By.Name: '41"; � Title: nutic,` Date: 15 1 14 Email or mail signed letter agreement to: Bill Baneky Kroll Bond Rating Agency,Inc. Tel: 646.731.2409 Email: bbaneky@kbra.com Return By: May 14,2019 Billing Information Company Contact Name Address W9 Required(Y/1) Page 9 805 Third Ave.129'h Floor I New York, NY 10022 1 T:212 702 0707 F:212 702 4500 1 r� r RECORD CITY SECRETARY FT. WORTH,TX Soto, Vania Elizabeth From: Hinojosa, Crystal Sent: Monday,April 1, 2019 2:40 PM To: Soto,Vania Elizabeth Subject: FW: Engagement Letters Vania, See Denis message below for all of the already executed engagements. I assume this is enough to have signed by City Secretary? For future engagements we will have routed through whole process. From: McElroy, Denis C. Sent: Monday,April 1, 2019 2:32 PM To: Hinojosa, Crystal<Crystal.Hinojosa@fortworthtexas.gov> Subject: RE: Engagement Letters As they've already been long ago executed without Law's signature, I don't see the benefit to running them through my department at this point. Denis McElroy Assistant City Attorney 200 Texas Street Fort Worth,Texas 76102 (817)392-2758 denis.mcelroy@fortworthtexas.gov City of Fort Worth — Working together to build a strong community FORTWORTHS From: Hinojosa, Crystal Sent: Monday, April 01, 2019 2:21 PM To: McElroy, Denis C. Subject: FW: Engagement Letters Denis, I need to route these to City Secretary office for CSCO number to be assigned for purchasing process. Do I need to also route these already executed engagements to Law as well? I